SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Form 8-K/A
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 28, 2001
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LEXINGTON CORPORATE PROPERTIES TRUST
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(Exact Name of Registrant as specified in its charter)
Maryland 1-12386 13-3717318
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(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) Identification No.)
355 Lexington Avenue New York, New York 10017
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(Address of Principal Executive Offices) (Zip Code)
(212) 692-7260
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Registrant's telephone number, including area code
Not Applicable
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(Former name or former address, if changed since last report)
ITEM 7. Financial Statements, Pro Forma Financial Information and Exhibits.
Item 7, entitled "Financial Statements, Pro Forma Financial Information and
Exhibits," is amended and restated in its entirety as follows:
(a) Previously filed as part of the Registration Statement (as
defined below).
(b) Unaudited Pro Forma Income Statement for the Nine Months Ended
September 30, 2001.
Unaudited Pro Forma Income Statement for the Year Ended December
31, 2000.
Unaudited Pro Forma Balance Sheet as of September 30, 2001.
(c) Exhibits
99.1 Joint Consent and Proxy Solicitation Statement/Prospectus of
Lexington (filed as Part I to Lexington's Registration
Statement on Form S-4 (File No. 333-70790)) (the
"Registration Statement").*
99.2 Press release of Lexington dated November 29, 2001
(previously filed as Exhibit 99.2 to Lexington's Current
Report on Form 8-K on November 30, 2001).*
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* Incorporated by Reference
2
PRO FORMA FINANCIAL INFORMATION
Lexington Corporate Properties Trust
The accompanying unaudited pro forma consolidated balance sheet
of Lexington as of September 30, 2001 has been prepared from the historical
consolidated financial statements of Lexington, Net 1 and Net 2, as adjusted to
give effect to (i) Lexington's acquisition of Net 1 and Net 2.
The accompanying unaudited pro forma statements of income of
Lexington for the year ended December 31, 2000 and the nine months ended
September 30, 2001 have been prepared as if (a) Lexington's acquisition of Net 1
and Net 2 had been consummated as of January 1, 2000 and (b) all 2001 and 2000
property purchases and sales, and the sale of 4.4 million common shares in an
underwritten public offering completed in July and August 2001, had been
consummated as of January 1, 2000. The unaudited pro forma financial data does
not purport to be indicative of what the results of operations or financial
position of Lexington would have been had the mergers, all other property
purchases and sales, and the above-referenced sale of common shares, been
completed on the date assumed, nor is such unaudited financial data necessarily
indicative of the results of operations of Lexington that may exist in the
future. The unaudited pro forma financial data must be read in conjunction with
the notes thereto and with the historical Consolidated Financial Statements and
the related notes included in Lexington's Annual Report on Form 10-K and
quarterly report on Form 10-Q.
Lexington Corporate Properties Trust
Unaudited Pro Forma Income Statement
for the Nine Months Ended September 30, 2001
Common
All other Share
Lexington Net 1 Net 2 Transactions(i) Offering
--------------- --------------- --------------- --------------- ----------
(Dollar amounts in thousands, except per share data)
Revenues
Rental...................................... $ 57,825 $ 4,020 $ 8,114 $ (141) $ --
Equity in earnings of non-consolidated
entities.................................... 2,196 -- -- 416 --
Interest and other ......................... 882 49 208 -- --
--------------- --------------- --------------- ------------- ---------
60,903 4,069 8,322 275 --
--------------- --------------- --------------- ------------- ---------
Expenses
Interest expense............................ 22,636 1,210 3,243 (81) (1,167)(j)
Depreciation and amortization of real
estate..................................... 13,449 758 1,556 --
Amortization of deferred expenses........... 1,192 -- 244 --
General and administrative expenses......... 3,682 353 819 --
Property operating expenses................. 1,150 -- -- --
Transaction costs -- 250 448 -- --
--------------- --------------- --------------- ------------- ---------
42,109 2,571 6,310 (81) (1,167)
--------------- --------------- --------------- ------------- ---------
Income before gains (losses) on sale of property,
minority interests and extraordinary item.... 18,794 1,498 2,012 356 1,167
Gains (losses) on sale of properties............. -- (456) 480 (24) --
--------------- --------------- --------------- ------------- ---------
Income before minority interest and
extraordinary item............................ 18,794 1,042 2,492 332 1,167
Minority interests............................... 3,935 -- -- -- --
--------------- --------------- --------------- ------------- ---------
Income before extraordinary item................. 14,859 1,042 2,492 332 1,167
Extraordinary item............................... (3,144) -- -- 3,144 --
--------------- --------------- --------------- ------------- ---------
Net income $ 11,715 $ 1,042 $ 2,492 $ 3,476 $ 1,167
=============== =============== =============== ============= =========
Income per common share - basic:
Income before extraordinary item............ $ 0.70
Extraordinary item.......................... (0.17)
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Net income.................................. $ 0.53
===============
Weighted average common shares
outstanding................................ 18,364,342
===============
Income per common share - diluted:
Income before extraordinary item............ $ 0.69
Extraordinary item.......................... (0.17)
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Net income.................................. $ 0.52
===============
Weighted average common shares
outstanding................................ 18,674,703
===============
Proforma Proforma
Adjustments Adjusted
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(Dollar amounts in thousands,
except per share data)
Revenues
Rental...................................... $ 72(a) $ 69,890
Equity in earnings of non-consolidated
entities.................................... -- 2,612
Interest and other ......................... (188)(b) 951
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(116) 73,453
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Expenses
Interest expense............................ 401(c) 26,242
Depreciation and amortization of real
estate..................................... 127(d) 15,890
Amortization of deferred expenses........... -- 1,436
General and administrative expenses......... (116)(e) 4,738
Property operating expenses................. -- 1,150
Transaction costs (698)(f) --
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(286) 49,456
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Income before gains on sale of property, minority
interests and extraordinary item............. 170 23,997
Gains on sale of properties...................... -- --
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Income before minority interest and
extraordinary item............................ 170 23,997
Minority interests............................... 35(h) 3,970
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Income before extraordinary item................. 135 20,027
Extraordinary item............................... -- --
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Net income $ 135 $ 20,027
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Income per common share - basic:
Income before extraordinary item............ $ 0.75
Extraordinary item.......................... --
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Net income.................................. $ 0.75
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Weighted average common shares
outstanding................................ 23,961,075
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Income per common share - diluted:
Income before extraordinary item............ $ 0.73
Extraordinary item.......................... --
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Net income.................................. $ 0.73
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Weighted average common shares
outstanding................................ 29,760,674
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Lexington Corporate Properties Trust
Unaudited Pro Forma Income Statement
for the Year Ended December 31, 2000
Common
All other Share
Lexington Net 1 Net 2 Transactions(i) Offering
--------------- --------------- --------------- --------------- ------------
(Dollar amounts in thousands, except per share data)
Revenues
Rental ............................. $ 76,824 $ 4,774 $ 10,126 $ 1,054 $ --
Equity in earnings of
non-consolidated entities........... 1,851 -- -- 1,049 --
Interest and other ................. 1,330 163 541 -- --
--------------- --------------- --------------- ------------- ------------
80,005 4,937 10,667 2,103 --
--------------- --------------- --------------- ------------- ------------
Expenses
Interest expense.................... 29,581 1,605 4,785 772 (2,000)(j)
Depreciation and amortization of
real estate......................... 17,513 941 2,049 158 --
Amortization of deferred expenses... 1,497 -- 383 7 --
General and administrative expenses. 4,902 447 1,011 (243) --
Property operating expenses......... 1,504 -- -- -- --
Transaction costs................... -- 400 400 -- --
--------------- --------------- --------------- ------------- ------------
54,997 3,393 8,628 694 (2,000)
--------------- --------------- --------------- ------------- ------------
Income before gain on sale of properties
and minority interests............... 25,008 1,544 2,039 1,409 2,000
Gain on sale of properties .............. 2,959 -- -- (695) --
--------------- --------------- --------------- ------------- ------------
Income before minority interests......... 27,967 1,544 2,039 714 2,000
Minority interests....................... 6,015 -- -- (184) --
--------------- --------------- --------------- ------------- ------------
Net income............................... $ 21,952 $ 1,544 $ 2,039 $ 898 $ 2,000
=============== =============== =============== ============= ============
Income per common share - basic:
Net income.......................... $ 1.15
Weighted average common shares ===============
outstanding ........................ 16,900,039
===============
Income per common share - diluted:
Net income.......................... $ 1.10
===============
Weighted average common shares
outstanding........................ 24,714,219
===============
Proforma Proforma
Adjustments Adjusted
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(Dollar amounts in thousands,
except per share data)
Revenues
Rental...................................... $ 96 (a) $ 92,874
Equity in earnings of non-consolidated
entities.................................... -- 2,900
Interest and other ......................... (394)(b) 1,640
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(298) 97,414
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Expenses
Interest expense............................ 447 (c) 35,190
Depreciation and amortization of
real estate................................ 170 (d) 20,831
Amortization of deferred expenses........... -- 1,887
General and administrative expenses......... (91)(e) 6,026
Property operating expenses................. -- 1,504
Transaction costs (800)(f) --
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(274) 65,438
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Income before gain on sale of properties
and minority interests....................... (24) 31,976
Gain on sale of properties...................... (2,264)(g) --
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Income before minority interests................. (2,288) 31,976
Minority interests............................... 39 (h) 5,870
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Net Income ...................................... $ (2,327) $ 26,106
=============== ===========
Income per common share - basic:
Net income.................................. $ 1.00
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Weighted average common shares
outstanding.............................. . 23,444,269
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Income per common share - diluted:
Net income.................................. $ 0.99
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Weighted average common shares
outstanding................................ 29,380,230
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Notes to Unaudited Pro Forma Income Statement
(Dollar amounts in thousands)
For the Nine
For the Year Months Ended
ended 12/31/00 9/30/01
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(a) Reflects straight line revenues relating to new measurement date for the Net 1 and Net 2
property leases........................................................................ $ 96 $ 72
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(b) Reflects the following:
Elimination of acquisition fees earned by Lexington on third party acquisitions made
by Net 1 and Net 2..................................................................... $ (120) $ --
Elimination of asset management fees earned by Lexington................................. (91) (116)
Elimination of interest earned in inter-entity notes payable/receivable.................. (183) (72)
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$ (394) $ (188)
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(c) Reflects the following:
Elimination of interest expense on inter-entity notes payable/receivable................. $ (183) $ (72)
Interest expense incurred in assumed line of credit drawn to purchase Net 1 and Net 2.... 630 473
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$ 447 $ 401
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(d) Depreciation expense on the merger consideration allocated to the real
estate assets of Net 1 and Net 2. The allocation of the purchase price
for pro forma purposes is based upon Lexington management's best
estimate of the relative fair value of each asset acquired and
liability assumed. This estimate was determined based upon the
familiarity with the Net Partnerships and industry experience.
Accordingly, for such pro forma purposes 80% of the purchase price, in
excess of other identifiable assets, has been allocated to real estate
with a 40 year life and 20% to land.................................................... $ 170 $ 127
========= =========
(e) Elimination of asset management fees paid by Net 1 & Net 2............................... $ (91) $ (116)
========= =========
(f) Elimination of merger costs incurred by Net 1 and Net 2.................................. $ (800) $ (698)
========= =========
(g) Elimination of gains on sale of real estate for transactions between Lexington and Net 1
and Net 2.............................................................................. $ (2,264) $ --
========= =========
(h) Impact on minority interest relating to the pro forma adjustments........................ $ 39 $ 35
========= =========
(i) Represents the pro forma impact on each respective income statement item for all 2001
and 2000 Lexington, Net 1 and Net 2 purchases and sales of real estate.................
(j) Elimination of interest expense associated with the repayment of $25,000, 8%
Exchangeable Redeemable Secured Notes.................................................. $ (2,000) $ (1,167)
========= =========
Lexington Corporate Properties Trust
Unaudited Pro Forma
Balance Sheet as of September 30, 2001
Proforma Proforma
Lexington Net 1 Net 2 Adjustments Adjusted
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(Dollar amounts in thousands except per share data)
Real estate, net ............................ $ 572,849 $ 42,642 $ 89,532 $ 9,050 (a) $ 714,073
Cash and cash equivalents.................... 15,766 987 1,600 (15,544)(b) 2,809
Restricted cash ............................. 1,729 -- -- -- 1,729
Investment in non-consolidated entities...... 48,778 -- -- -- 48,778
Other assets................................. 45,396 1,428 3,154 (8,750)(c) 41,228
---------- ---------- ---------- ---------- ------------
Total assets............................ $ 684,518 $ 45,057 $ 94,286 $ (15,244) $ 808,617
========== ========== ========== ========== ============
Mortgages and notes payable.................. $ 348,763 $ 19,879 $ 54,906 $ 16,593 (d) $ 440,141
Deferred installment obligations............. 6,654 -- -- -- 6,654
Other liabilities............................ 6,459 1,693 1,130 (41)(e) 9,241
---------- ---------- ---------- ---------- ------------
361,876 21,572 56,036 16,552 456,036
---------- ---------- ---------- ---------- ------------
Minority interest............................ 57,365 -- -- 322 (f) 57,687
---------- ---------- ---------- ---------- ------------
Mezzanine equity:
Preferred shares........................ 24,369 -- -- -- 24,369
---------- ---------- ---------- ---------- ------------
Common shares........................... 3,809 -- -- -- 3,809
---------- ---------- ---------- ---------- ------------
Partners' capital............................ -- 23,485 38,250 (61,735)(g) --
Shareholders' equity:
Common shares........................... 2 -- -- -- 2
Additional paid in capital ............. 311,231 -- -- 29,617 (h) 340,848
Deferred compensation................... (1,779) -- -- -- (1,779)
Accumulated distributions in excess
of earnings......................... (70,382) -- -- -- (70,382)
Notes receivable from
officers/shareholders............... (1,973) -- -- -- (1,973)
---------- ---------- ---------- ---------- ------------
Shareholders' equity/partners' capital.. 237,099 23,485 38,250 (32,118) 266,716
---------- ---------- ---------- ---------- ------------
$ 684,518 $ 45,057 $ 94,286 $ (15,244) $ 808,617
========== ========== ========== ========== ============
Notes to Unaudited Pro Forma Balance Sheet
(Dollar amounts in thousands, except per share data)
(a) Reflects the excess over historical cost basis of consideration paid by Lexington for the real estate of Net 1 and
Net 2 as determined as follows:
Merger consideration issued................................................................................ $ 63,885
Mortgages assumed.......................................................................................... 73,378
Merger costs............................................................................................... 2,010
Other liabilities assumed.................................................................................. 2,782
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Purchase price........................................................................................ 142,055
Allocation
Identifiable other assets.......................................................................... (1,688)
Share issuance costs, contra equity................................................................ (2,010)
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Subtotal............................................................................ 138,357
Reclassification of Lexington investment in and receivables from Net 1 and Net 2.................. 2,867
-----------
Allocation to real estate, net..................................................................... 141,224
Historical Net Partnership real estate basis....................................................... (132,174)
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$ 9,050
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(b) Reflects the following:
The payment of costs incurred by Net 1 and Net 2 associated with the mergers and estimated final partner
distributions.............................................................................................. $ (1,948)
Cash paid to the limited partners of Net 1 and Net 2.......................................................... (31,596)
Proceeds from borrowing on credit facility.................................................................... 18,000
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$ (15,544)
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(c) Reflects the following:
Elimination of inter-entity notes receivable and accrued interest............................................. $ (1,407)
Elimination of Lexington basis in its investments in limited partner units of Net 1 and Net 2................. (1,419)
Allocation of merger costs paid by Lexington.................................................................. (2,010)
Elimination of accounts receivable - straight line rents for Net 1 and Net 2 property leases.................. (2,799)
Elimination of inter-entity accounts receivable............................................................... (41)
Elimination of Lexington percentage ownership in the Net 1 and Net 2 asset management contracts............... (340)
Elimination of capitalized financing costs of Net 1 and Net 2................................................. (734)
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$ (8,750)
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(d) Reflects the following:
The elimination of inter-entity notes payable and accrued interest............................................ $ (1,407)
Proceeds from borrowing on credit facility.................................................................... 18,000
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$ 16,593
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(e) Reflects the Elimination of inter-entity accounts payable..................................................... $ (41)
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(f) Reflects the following:
Issuance of 44,858 limited partnership units in Net 3, at $14.75 per unit price, in exchange for the general
partnership interests in Net 1 and Net 2................................................................... $ 662
Elimination of Lexington percentage ownership in the Net 1 and Net 2 asset management contracts............... (340)
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$ 322
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(g) Reflects the elimination of Net 1 and Net 2 partners' capital................................................. $ (61,735)
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(h) Reflects the issuance of 2,144,230 common shares, at $14.75 per share price, associated with the merger net of
offering costs to be paid by Lexington of $2,010........................................................... $ 29,617
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
LEXINGTON CORPORATE PROPERTIES TRUST
Date: December 11, 2001 By: /s/ T. Wilson Eglin
-------------------------------
T. Wilson Eglin
President
EXHIBIT INDEX
Exhibit No. Exhibit
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99.1 Joint Consent and Proxy Solicitation Statement/Prospectus of
Lexington (filed as Part I to Lexington's Registration Statement
on Form S-4 (File No. 333-70790)).
99.2 Press release of Lexington dated November 29, 2001 (previously
filed as Exhibit 99.2 to Lexington's Current Report on Form 8-K
on November 30, 2001).*
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* Incorporated by Reference