1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) of the Securities
Exchange Act of 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1996
/ / Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
--------------------------
Commission File Number 1-13102
--------------------------
FIRST INDUSTRIAL REALTY TRUST, INC.
(Exact name of Registrant as specified in its Charter)
MARYLAND 36-3935116
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
150 N. WACKER DRIVE, SUITE 150, CHICAGO, ILLINOIS 60606
(Address of principal executive offices)
(312) 704-9000
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months, and (2) has been subject to such filing
requirements for the past 90 days. Yes /X/ No
Number of shares of Common Stock, $.01 par value, outstanding as of August 8,
1996: 24,137,881.
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FIRST INDUSTRIAL REALTY TRUST, INC.
FORM 10-Q
FOR THE PERIOD ENDED JUNE 30, 1996
INDEX
PAGE
PART I: FINANCIAL INFORMATION ----
Item 1. Financial Statements
Consolidated Balance Sheets as of June 30,1996 and December 31, 1995.......... 2
Consolidated Statements of Operations for the Six Month Periods Ended
June 30, 1996 and June 30, 1995............................................... 3
Consolidated Statements of Operations for the Three Month Periods Ended
June 30, 1996 and June 30, 1995............................................... 4
Consolidated Statements of Cash Flows for the Six Month Periods Ended
June 30, 1996 and June 30, 1995............................................... 5
Notes to Financial Statements................................................. 6-16
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.....................................................17-19
PART II: OTHER INFORMATION
Item 1. Legal Proceedings........................................................ 20
Item 2. Changes in Securities.................................................... 20
Item 3. Defaults Upon Senior Securities.......................................... 20
Item 4. Submission of Matters to a Vote of Security Holders...................... 20
Item 5. Other Information........................................................ 20
Item 6. Exhibits and Reports on Form 8-K......................................... 21
SIGNATURE............................................................................ 22
EXHIBIT INDEX........................................................................ 23
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
FIRST INDUSTRIAL REALTY TRUST, INC.
CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
June 30, December 31,
1996 1995
ASSETS ---------- -----------
Assets:
Investment in Real Estate:
Land................................................ $131,508 $109,227
Buildings and Improvements.......................... 770,271 645,872
Furniture, Fixtures and Equipment................... 1,672 2,024
Construction in Progress............................ 2,561 393
Less: Accumulated Depreciation...................... (78,893) (68,749)
-------- --------
Net Investment in Real Estate..................... 827,119 688,767
Cash and Cash Equivalents............................ 5,538 8,919
Restricted Cash...................................... 9,032 11,732
Tenant Accounts Receivable, Net...................... 4,410 2,561
Deferred Rent Receivable............................. 8,108 7,676
Interest Rate Protection Agreement, Net.............. 8,453 8,529
Deferred Financing Costs, Net........................ 8,564 9,422
Prepaid Expenses and Other Assets, Net............... 13,076 16,298
Total Assets...................................... $884,300 $753,904
======== ========
LIABILITIES AND STOCKHOLDER EQUITY
Liabilities:
Mortgage Loans Payable............................... $392,590 $346,850
Construction Loans Payable........................... --- 4,873
Acquisition Facilities Payable....................... 19,660 48,235
Accounts Payable and Accrued Expenses................ 15,858 12,468
Rents Received in Advance and Security Deposits...... 4,225 4,124
Dividends/Distributions Payable...................... 12,759 10,422
-------- --------
Total Liabilities.................................. 445,092 426,972
-------- --------
Minority Interest..................................... 34,492 20,909
Commitments and Contingencies......................... --- ---
Stockholders' Equity:
Preferred Stock ($.01 par value, 10,000,000 shares
1,650,000 shares issued and outstanding)........... 17 17
Common Stock ($.01 par value, 100,000,000 shares
authorized, 24,137,881 and 18,881,399 shares issued
and outstanding at June 30, 1996 and December 31,
1995, respectively)................................ 241 190
Additional Paid-in-Capital.......................... 445,402 338,907
Distributions in Excess of Accumulated Earnings..... (40,944) (33,091)
-------- --------
Total Stockholders' Equity.......................... 404,716 306,023
-------- --------
Total Liabilities and Stockholders' Equity.......... $884,300 $753,904
======== ========
The accompanying notes are an integral part of the financial statements.
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FIRST INDUSTRIAL REALTY TRUST, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
Six Months Six Months
Ended Ended
------------- -------------
June 30, 1996 June 30, 1995
------------- -------------
Revenues:
Rental Income........................................... $49,881 $40,277
Tenant Recoveries and Other Income...................... 15,543 11,196
------- -------
Total Revenues.................................. 65,424 51,473
------- -------
Expenses:
Real Estate Taxes....................................... 10,905 8,179
Repairs and Maintenance................................. 2,859 1,955
Property Management..................................... 2,327 1,635
Utilities............................................... 1,818 1,083
Insurance............................................... 538 446
Other................................................... 549 343
General and Administrative.............................. 1,901 1,465
Interest................................................ 13,997 13,764
Amortization of Interest Rate Protection Agreements and
Deferred Financing Costs............................... 1,574 2,979
Depreciation and Other Amortization..................... 13,412 10,756
------- -------
Total Expenses.................................. 49,880 42,605
------- -------
Income Before Gain on Sales of Properties, Minority
Interest and Extraordinary Loss........................ 15,544 8,868
Gain on Sales of Properties............................. 4,320 ---
------- -------
Income Before Minority Interest and Extraordinary Loss.. 19,864 8,868
Income Allocated to Minority Interest................... (1,405) (668)
------- -------
Income Before Extraordinary Loss........................ 18,459 8,200
Extraordinary Loss...................................... (821) ---
------- -------
Net Income.............................................. 17,638 8,200
Less: Preferred Stock Dividends........................ (1,960) ---
------- -------
Net Income Available to Common Stockholders........... $15,678 $ 8,200
======= =======
Net Income Available to Common Stockholders Before
Extraordinary Loss Per Weighted Average Common
Share Outstanding (23,221,635 and 18,881,399 as of $ .71 $ .43
June 30, 1996 and 1995, respectively).................. ======= =======
Extraordinary Loss Per Weighted Average Common Share
Outstanding (23,221,635 and 18,881,399 as of June 30,
1996 and 1995, respectively)........................... $ . 03 $ ---
======= =======
Net Income Available to Common Stockholders Per
Weighted Average Common Share Outstanding (23,221,635
and 8,881,399 as of June 30, 1996 and 1995, $ .68 $ .43
respectively).......................................... ======= =======
The accompanying notes are an integral part of the financial statements.
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FIRST INDUSTRIAL REALTY TRUST, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
Three Months Three Months
Ended Ended
------------- -------------
June 30, 1996 June 30, 1995
------------- -------------
Revenues:
Rental Income.................................................. $26,755 $20,487
Tenant Recoveries and Other Income............................. 8,024 5,639
------- -------
Total Revenues............................................ 34,779 26,126
------- -------
Expenses:
Real Estate Taxes.............................................. 5,759 4,143
Repairs and Maintenance........................................ 1,440 1,006
Property Management............................................ 1,268 768
Utilities...................................................... 947 501
Insurance...................................................... 337 228
Other.......................................................... 281 145
General and Administrative..................................... 967 738
Interest....................................................... 7,359 7,186
Amortization of Interest Rate Protection Agreements and
Deferred Financing Costs..................................... 799 1,501
Depreciation and Other Amortization............................ 7,064 5,557
------- -------
Total Expenses........................................... 26,221 21,773
------- -------
Income Before Gain on Sales of Properties and Minority Interest 8,558 4,353
Gain on Sales of Properties.................................... 4,320 -
------- -------
Income Before Minority Interest................................ 12,878 4,353
Income Allocated to Minority Interest.......................... (1,001) (328)
------- -------
Net Income..................................................... 11,877 4,025
Less: Preferred Stock Dividends................................ (980) -
------- -------
Net Income Available to Common Stockholders.................... $10,897 $ 4,025
======= =======
Net Income Available to Common Stockholders Per Weighted
Average Common Share Outstanding (24,137,615 and
18,881,399 as of June 30, 1996 and 1995, respectively)........ $ .45 $ .21
======= =======
The accompanying notes are an integral part of the financial statements.
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FIRST INDUSTRIAL REALTY TRUST, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(DOLLARS IN THOUSANDS)
(UNAUDITED)
Six Months Six Months
Ended Ended
------------- -------------
June 30, 1996 June 30, 1995
------------- -------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income........................................................ $ 17,638 $ 8,200
Income Allocated to Minority Interest............................. 1,405 668
--------- ---------
Income Before Minority Interest................................... 19,043 8,868
Adjustments to Reconcile Net Income to Net Cash Provided
by Operating Activities:
Depreciation...................................................... 11,687 9,524
Amortization of Interest Rate Protection Agreements and
Deferred Financing Costs......................................... 1,574 2,979
Other Amortization................................................ 1,725 1,232
Gain on Sales of Properties....................................... (4,320) ---
Extraordinary Loss................................................ 821 ---
Provision for Bad Debts........................................... 150 105
(Increase) in Tenant Accounts Receivable and Prepaid
Expenses and Other Assets........................................ (501) (1,333)
(Increase) in Deferred Rent Receivable............................ (432) (831)
Increase (Decrease) in Accounts Payable and Accrued
Expenses and Rents Received in Advance and
Security Deposits................................................ 2,617 (128)
(Increase) Decrease in Restricted Cash............................ 1,819 (189)
--------- ---------
Net Cash Provided by Operating Activities...................... 34,183 20,227
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases and Additions to Investment in Real Estate.... (133,605) (51,554)
Proceeds from Sales of Investment in Real Estate................... 12,119 ---
Decrease in Restricted Cash........................................ 881 1,481
--------- ---------
Net Cash Used in Investing Activities.......................... (120,605) (50,073)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Sale of Common Stock................................. 113,850 ---
Common Stock Underwriting Discounts/Offering Costs................. (6,957) ---
Preferred Stock Offering Costs..................................... (408) ---
Proceeds from Acquisition Facilities Payable....................... 29,348 48,800
Repayments on Acquisition Facilities Payable....................... (57,922) ---
Proceeds from Mortgage Loans Payable............................... 36,750 ---
Repayments on Mortgage Loans Payable............................... (427) ---
Proceeds from Construction Loans Payable........................... --- 1,160
Repayments on Construction Loans Payable........................... (4,873) ---
Dividends/Distributions............................................ (22,431) (19,296)
Preferred Stock Dividends.......................................... (2,427) ---
Debt Issuance Costs................................................ (1,462) (2,039)
--------- ---------
Net Cash Provided by Financing Activities...................... 83,041 28,625
--------- ---------
Net (Decrease) in Cash and Cash Equivalents......................... (3,381) (1,221)
Cash and Cash Equivalents, Beginning of Period...................... 8,919 9,117
--------- ---------
Cash and Cash Equivalents, End of Period............................ $ 5,538 $ 7,896
========= =========
The accompanying notes are an integral part of the financial statements.
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FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
(UNAUDITED)
1. ORGANIZATION AND FORMATION OF COMPANY
First Industrial Realty Trust, Inc. (the "Company") was organized in the
state of Maryland on August 10, 1993. The Company is a real estate investment
trust ("REIT") as defined in the Internal Revenue Code. The Company is
continuing and expanding the Midwestern industrial property business of The
Shidler Group and the properties and businesses contributed by three other
contributing businesses (the "Contributing Businesses"). The Company's
operations are conducted primarily through First Industrial, L.P. (the
"Operating Partnership") of which the Company is the sole general partner. As
of June 30, 1996, the Company owned 320 in-service properties located in 14
states, containing an aggregate of approximately 28.3 million square feet of
gross leasable area. Of the 320 properties owned by the Company, 195 are held
by First Industrial Financing Partnership, L.P. (the "Financing Partnership"),
82 are held by the Operating Partnership or the Operating Partnership's
Pennsylvania subsidiaries, 19 are held by First Industrial Securities, L.P.
(the "Securities Partnership"), 23 are held by First Industrial Mortgage
Partnership, L.P. (the "Mortgage Partnership") and 1 is held by First
Industrial Indianapolis, L.P. (the "Indianapolis Partnership").
On June 30, 1994, the Company completed its initial public offering of
15,175,000 shares of $.01 par value common stock (the "Initial Offering") and,
in July 1994, issued an additional 1,400,000 shares pursuant to an
over-allotment option. The price per share in the Initial Offering and the
over-allotment option was $23.50, resulting in gross offering proceeds of
approximately $389,512. Net of underwriters' discount and total offering
expenses, the Company received approximately $355,217 in proceeds from the
Initial Offering and the over-allotment option. On June 30, 1994, the Company
(through the Financing Partnership) borrowed $300,000 (the "1994 Mortgage
Loan") from an institutional lender. The net proceeds from the Initial
Offering and 1994 Mortgage Loan were used primarily to acquire properties,
repay indebtedness and pay certain fees and expenses. The Company began
operations on July 1, 1994.
On February 2, 1996, the Company issued an additional 5,175,000 shares of
$.01 par value common stock (the "1996 Equity Offering") inclusive of the
underwriters' over-allotment option. The price per share in the 1996 Equity
Offering was $22, resulting in gross offering proceeds of $113,850. Net of
underwriters' discount and total offering expenses, the Company received
approximately $106,291. The net proceeds from the 1996 Equity Offering were
used to pay down the 1994 Acquisition Facility, 1995 Acquisition Facility and
Construction Loans (hereinafter defined) and fund properties subsequently
acquired.
2. BASIS OF PRESENTATION
First Industrial Realty Trust, Inc. is the sole general partner of the
Operating Partnership, with an approximate 91.9% ownership interest at June 30,
1996. First Industrial Realty Trust, Inc. is the sole stockholder of First
Industrial Finance Corporation, First Industrial Securities Corporation, First
Industrial Mortgage Corporation and First Industrial Indianapolis Corporation,
which are the sole general partners of the Financing Partnership, the
Securities Partnership, the Mortgage Partnership and the Indianapolis
Partnership, respectively. The Operating Partnership is the sole limited
partner of the Financing Partnership, the Securities Partnership, the Mortgage
Partnership and the Indianapolis Partnership. All significant intercompany
transactions have been eliminated in consolidation. Purchase accounting has
been applied when ownership interests in properties were acquired for cash.
The historical cost basis of properties has been carried over when the
Contributing Businesses' ownership interests were exchanged for Operating
Partnership units and purchase accounting has been used for all other
properties that were acquired for Operating Partnership units.
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FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
(UNAUDITED)
In the opinion of management, all adjustments, consisting only of normal
recurring adjustments, necessary to present fairly the financial position of
the Company as of June 30, 1996 and the results of operations and cash flows
for the six months ended June 30, 1996 and 1995, and for the three months ended
June 30, 1996 and 1995, have been included.
Minority interest in the Company at June 30, 1996 represents the
approximately 8.1% aggregate partnership interest in the Operating Partnership
held by the limited partners thereof.
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
In order to conform with generally accepted accounting principles,
management, in preparation of the Company's financial statements, is required
to make estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities as of June
30, 1996 and December 31, 1995, and the reported amounts of revenues and
expenses for the six months ended June 30, 1996 and 1995, and for the three
months ended June 30, 1996 and 1995. Actual results could differ from those
estimates.
Revenue Recognition:
Rental income is recognized on a straight-line method under which
contractual rent increases are recognized evenly over the lease term. Tenant
recovery income includes payments from tenants for taxes, insurance and other
property operating expenses and is recognized as revenues in the same period
the related expenses are incurred by the Company.
The Company provides an allowance for doubtful accounts against the
portion of tenant accounts receivable which is estimated to be uncollectible.
Accounts receivable in the consolidated balance sheets are shown net of an
allowance for doubtful accounts of $500 as of June 30, 1996 and December 31,
1995.
Investment in Real Estate and Depreciation:
Real estate assets are carried at the lower of depreciated cost or fair
value as determined by the Company. The Company reviews its properties on a
quarterly basis for impairment and provides a provision if impairments are
determined. First, to determine if impairment may exist, the Company reviews
its properties and identifies those which have had either an event of change or
event of circumstances warranting further assessment of recoverability. Then,
the Company estimates the fair value of those properties on an individual basis
by capitalizing the expected net operating income and discounting the expected
cash flows of the properties. Such amounts are then compared to the property's
depreciated cost to determine whether an impairment exists. Interest expense,
real estate taxes and other directly related expenses incurred during
construction periods are capitalized and depreciated commencing with the date
placed in service, on the same basis as the related assets. Depreciation
expense is computed using the straight-line method based on the following
useful lives:
Years
-----
Buildings and Improvements................. 31.5 to 40
Land Improvements.......................... 15
Furniture, Fixtures and Equipment.......... 5 to 10
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FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
(UNAUDITED)
Construction expenditures for tenant improvements and leasing commissions
are capitalized and amortized over the terms of each specific lease.
Maintenance and repairs are charged to expense when incurred. Expenditures for
improvements are capitalized.
When assets are sold or retired, their costs and related accumulated
depreciation are removed from the accounts with the resulting gains or losses
reflected in net income or loss.
Cash and Cash Equivalents:
Cash and Cash Equivalents include all cash and liquid investments with an
initial maturity of three months or less. The carrying amount approximates
fair value due to the short maturity of these investments.
Income Taxes:
The Company has elected to be taxed as a REIT under Sections 856 through
860 of the Internal Revenue Code of 1986, as amended (the "Code"). As a
result, the Company generally is not subject to federal income taxation at the
corporate level to the extent it distributes annually at least 95% of its REIT
taxable income, as defined in the Code, to its stockholders and satisfies
certain other requirements. Accordingly, no provision has been made for
federal income taxes in the accompanying consolidated financial statements.
The Company and certain of its subsidiaries are subject to certain state
and local income, excise and franchise taxes. The provision for such state and
local taxes has been reflected in general and administrative expense in the
consolidated statement of operations and has not been separately stated due to
its insignificance.
For federal income tax purposes, the cash distributions paid to
stockholders may be characterized as ordinary income, return of capital
(generally non-taxable) or capital gains.
Fair Value of Financial Instruments:
The Company's financial instruments include short-term investments, tenant
accounts receivable, accounts payable, other accrued expenses, mortgage loans
payable and acquisition facilities payable. The fair values of these financial
instruments were not materially different from their carrying or contract
values. The Company's financial instruments also include interest rate
protection agreements (see Note 4).
Deferred Financing Costs:
Deferred financing costs include fees and costs incurred to obtain
long-term financing. These fees and costs are being amortized over the terms of
the respective loans. Accumulated amortization of deferred financing costs was
$5,075 and $3,593, at June 30, 1996 and December 31, 1995, respectively.
Unamortized deferred financing fees are written-off when debt is retired before
the maturity date (see Note 11).
Earnings Per Common Share:
Net income per share amounts are based on the weighted average of common
and common stock equivalent (stock options) shares outstanding. As of June 30,
1996 and 1995, the number of shares of common stock outstanding was 24,137,881
and 18,881,399, respectively.
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FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
(UNAUDITED)
4. MORTGAGE LOANS, ACQUISITION FACILITIES AND CONSTRUCTION LOANS PAYABLE
Mortgage Loans:
Concurrent with the Initial Offering, the Company (through the Financing
Partnership) borrowed $300,000 under a mortgage loan (the "1994 Mortgage
Loan"). The 1994 Mortgage Loan is cross-collateralized by, among other things,
first mortgage liens on the 195 properties owned by the Financing Partnership.
The 1994 Mortgage Loan will mature on June 30, 1999, unless extended by the
Company, subject to certain conditions, for an additional two-year period,
thereby maturing on June 30, 2001. The Operating Partnership has guaranteed
certain obligations of the Financing Partnership under the 1994 Mortgage Loan.
The 1994 Mortgage Loan provides for interest only payments which have been
effectively fixed at a rate of 6.97% through June 30, 2001 by certain interest
rate protection agreements. Interest payable related to the 1994 Mortgage Loan
was $1,709 and $1,905 at June 30, 1996 and December 31, 1995, respectively.
Payments to (from) the Company under the interest rate protection agreements
for the six months ended June 30, 1996 and 1995 totaled ($143) and $406,
respectively, and for the three months ended June 30, 1996 and 1995 totaled
($101) and $215, respectively, which have been included as a component of
interest expense.
In conjunction with obtaining the 1994 Mortgage Loan, the Company
purchased an interest rate protection agreement which effectively limited the
interest rate during the initial five-year term of the 1994 Mortgage Loan to
7.2% per annum. Prior to the subsequent replacement of this interest rate
protection agreement, its cost of $18,450 had been capitalized and was being
amortized over the five-year term of the agreement.
Effective July 1, 1995, the Company replaced such interest rate protection
agreement with new interest rate protection agreements and entered into
interest rate swap agreements, which together effectively fix the annual
interest rate on the 1994 Mortgage Loan at 6.97% for six years through June 30,
2001. As a result of the replacement of the interest rate protection
agreement, the Company incurred a one-time loss of $6.4 million, of which $6.3
million represents the difference between the unamortized cost of the replaced
interest rate protection agreement and the cost of the new agreements. In the
event that the Company does not exercise the two-year option to extend the 1994
Mortgage Loan, the risk associated with the interest rate protection agreements
is that the Company would be obligated to perform its obligations under the
terms or would either pay or receive cash to terminate the agreement. In
either event, the impact of such transaction would be reflected in the
Company's financial statements. The costs of the new interest rate protection
agreements have been capitalized and are being amortized over the respective
terms of the agreements. Under the terms of the new interest rate protection
agreements, certain collateral may be required to be set aside for amounts that
could become due under the agreements. At June 30, 1996 and December 31, 1995,
cash collateral of $0 and $2,557, respectively, was included in restricted
cash. Accumulated amortization on the interest protection agreements was $146
and $60 as of June 30, 1996 and December 31, 1995, respectively.
At June 30, 1996, the fair market value of the interest rate protection
agreements was approximately $12,510, which exceeded the $8,453 net book value
by approximately $4,057. The fair market value was determined by a third party
evaluation and is based on estimated discounted future cash flows.
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FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
(UNAUDITED)
Under the terms of the 1994 Mortgage Loan, certain cash reserves are
required to be and have been set aside for payments of tenant improvements,
capital expenditures, interest, real estate taxes, insurance and potential
environmental costs. The amount of cash reserves for payments of tenant
improvements, capital expenditures and potential environmental costs were
determined by the lender and were established at the closing of the 1994
Mortgage Loan. The amounts included in the cash reserves relating to payments
of interest, real estate taxes and insurance were determined by the lender and
approximate the next periodic payment of such item. At June 30, 1996 and
December 31, 1995, these reserves totaled $7,733 and $8,552, respectively, and
are included in Restricted Cash. Such cash reserves were invested in a money
market fund at June 30, 1996. The maturity of these investments is one day.
Accordingly, cost approximates fair market value.
On December 29, 1995 the Mortgage Partnership borrowed $40,200 under a
mortgage loan (the "1995 Mortgage Loan") from an institutional lender. In the
first quarter of 1996, the Company made a one time paydown of $200. The 1995
Mortgage Loan matures on January 11, 2026 and provides for interest only
payments through January 11, 1998, after which monthly principal and interest
payments are required based on a 28-year amortization schedule. The interest
rate under the 1995 Mortgage Loan is fixed at 7.22% per annum through January
11, 2003. After January 11, 2003, the interest rate adjusts through a
predetermined formula based on the applicable Treasury rate. Interest payable
related to the 1995 Mortgage Loan was $168 and $24 at June 30, 1996 and
December 31, 1995, respectively. The 1995 Mortgage Loan is collateralized by
23 properties held by the Mortgage Partnership.
Under the terms of the 1995 Mortgage Loan, certain cash reserves are
required to be and have been set aside for payments of security deposits,
capital expenditures, interest, real estate taxes and insurance. The amount of
cash reserves segregated for security deposits is adjusted as tenants turnover.
The amounts included in the cash reserves relating to payments of capital
expenditures, interest, real estate taxes and insurance were determined by the
lender and approximate the next periodic payment of such items. At June 30,
1996 and December 31, 1995, these reserves totaled $1,299 and $388,
respectively, and are included in Restricted Cash. Such cash reserves were
invested in a money market fund at June 30, 1996. The maturity of these
investments is one day. Accordingly, cost approximates fair market value.
On December 14, 1995, the Company, through First Industrial Harrisburg,
L.P., entered into a $6,650 mortgage loan (the "Harrisburg Mortgage Loan") that
is collateralized by three properties in Harrisburg, Pennsylvania. The
Harrisburg Mortgage Loan bears interest at a rate based on LIBOR plus 1.5% or
prime plus 2.25%, at the Company's option, and provides for interest only
payments through May 31, 1996, with monthly principal and interest payments
required subsequently based on a 26.5-year amortization schedule. At June 30,
1996, the interest rate was 7.0%. The Harrisburg Mortgage Loan will mature on
December 15, 2000. Interest payable related to the Harrisburg Mortgage Loan
was $36 and $0 at June 30, 1996 and December 31, 1995, respectively.
On March 20, 1996, the Company, through the Operating Partnership and the
Indianapolis Partnership, entered into a $36,750 mortgage loan (the "CIGNA
Loan") that is collateralized by seven properties in Indianapolis, Indiana and
three properties in Cincinnati, Ohio. The CIGNA Loan bears interest at a fixed
interest rate of 7.5% and provides for monthly principal and interest payments
based on a 25-year amortization schedule. The CIGNA Loan will mature on April
1, 2003. Interest payable related to the CIGNA Loan was $0 at June 30, 1996.
10
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FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
(UNAUDITED)
On March 20, 1996, the Company, through the Operating Partnership assumed
a $6,424 mortgage loan and a $2,993 mortgage loan (together, the "Assumed
Loans") that are collateralized by 13 properties in Indianapolis, Indiana and
one property in Indianapolis, Indiana, respectively. The Assumed Loans bear
interest at a fixed rate of 9.25% and provide for monthly principal and
interest payments based on a 16.75-year amortization schedule. The Assumed
Loans will mature on January 1, 2013. Interest payable related to the Assumed
Loans was $0 at June 30, 1996.
Acquisition Facilities:
In connection with the Initial Offering, the Operating Partnership entered
into a three-year, $100,000 collateralized revolving credit facility (the "1994
Acquisition Facility"). During the quarter ended June 30, 1995, the capacity
of the 1994 Acquisition Facility was increased to $150,000. The Operating
Partnership may borrow under the facility to finance the acquisition of
additional properties and for other corporate purposes, including to obtain
additional working capital. The Company has guaranteed repayment of the 1994
Acquisition Facility. The 1994 Acquisition Facility will mature on June 29,
1997. As of June 30, 1996, borrowings under the 1994 Acquisition Facility
totaled $19,660. Borrowings under the 1994 Acquisition Facility bear interest
at a floating rate equal to LIBOR plus 2.0% or a "Corporate Base Rate" plus
.5%, at the Company's election. Effective July 12, 1996, the lenders reduced
the interest rate to LIBOR plus 1.75%. Under the 1994 Acquisition Facility,
LIBOR contracts are entered into by the Company as draws are made. At June 30,
1996, the weighted average interest rate was approximately 7.5%. Interest
payable related to the 1994 Acquisition Facility was $114 and $488 at June 30,
1996 and December 31, 1995, respectively. The borrowings under the 1994
Acquisition Facility are cross-collateralized by 25 properties held by the
Operating Partnership. The 1994 Acquisition Facility contains certain
financial covenants relating to debt service coverage, market value net worth,
dividend payout ratio, and total funded indebtedness.
In addition, in December 1995, the Operating Partnership entered into a
$24,219 collateralized revolving credit facility (the "1995 Acquisition
Facility") with a commercial bank. The 1995 Acquisition Facility was paid off
in full and retired in February 1996 with a portion of the proceeds of the 1996
Equity Offering. The 1995 Acquisition Facility was collateralized by six
properties held by the Operating Partnership and bore interest at a floating
rate of LIBOR plus 2.45%. As of December 31, 1995, borrowings under the 1995
Acquisition Facility were $11,294 and bore interest at a rate of 8.3%.
Interest payable related to the 1995 Acquisition Facility was $27 at December
31, 1995.
In May 1996, the Operating Partnership entered into a $10,000
collateralized revolving credit facility (the "1996 Credit Line") with a
commercial bank. The 1996 Credit Line is collateralized by three properties
held by the Operating Partnership. The Company has guaranteed repayment of the
1996 Credit Line. Borrowings under the 1996 Credit Line bear interest at a
floating rate from LIBOR plus 2.45% to LIBOR plus 2.75%, depending on the term
of the interest rate option. The 1996 Credit Line will mature on December 14,
1998. As of June 30, 1996, borrowings under the 1996 Credit Line totaled $0.
11
13
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
(UNAUDITED)
Construction Loans:
In 1995, the Operating Partnership entered into two construction loans
(together the "Construction Loans") with commercial banks providing total
funding commitments of $5,860. Both construction loans were paid off in full
and retired in February 1996 with a portion of the proceeds of the 1996 Equity
Offering. At December 31, 1995, the Operating Partnership had borrowed $4,873
under such construction loans which were collateralized by two properties held
by the Operating Partnership. Such borrowings bore interest at LIBOR plus 2.0%
and provided for interest only payments.
The following is a schedule of maturities of the mortgage loans and
acquisition facilities for the next five years ending December 31, and
thereafter:
Amount
--------
1996 $ 444
1997 20,720
1998 1,563
1999 301,710
2000 7,327
Thereafter 80,486
--------
Total $412,250
========
The 1994 Mortgage Loan matures in 1999 but may be extended at the
Company's option, subject to certain conditions, for an additional two years,
thereby maturing on June 30, 2001.
5. PREFERRED STOCK
In 1995, the Company issued 1.65 million shares of 9.5% Series A
Cumulative Preferred Stock (the "Series A Preferred Stock") at a purchase price
of $25 per share, and used the $41,250 of gross proceeds to pay down debt
outstanding under the 1994 Acquisition Facility. Dividends on the Series A
Preferred Stock are cumulative from the date of initial issuance and are
payable quarterly. The payment of dividends and amounts upon liquidation,
dissolution or winding-up ranks senior to the payments on the Company's common
stock. The Series A Preferred Stock are not redeemable prior to November 17,
2000. On or after November 17, 2000, the Series A Preferred Stock is
redeemable for cash at the option of the Company, in whole or in part, at
$25.00 per share, or $41,250 in the aggregate, plus dividends accrued and
unpaid to the redemption date. The Series A Preferred Stock has no stated
maturity and is not convertible into any other securities of the Company.
The payment of dividends on, and payments on liquidation or redemption of,
the Series A Preferred Stock are guaranteed by the Securities Partnership (the
"Guarantor") pursuant to a Guarantee and Payment Agreement (the "Guarantee
Agreement"). The Series A Preferred Stock is the only class of securities of
the Company which have the benefit of such guarantee. To the extent the
Company fails to make any payment of dividend or pay any portion of the
liquidation preference on or the redemption price of any shares of Series A
Preferred Stock, the Guarantor will be obligated to pay an amount to each
holder of Series A Preferred Stock equal to any such shortfall.
12
14
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
(UNAUDITED)
6. ACQUISITION OF REAL ESTATE
During the three months ended June 30, 1996, through the Operating
Partnership or a subsidiary thereof, the Company acquired 11 existing
buildings. The aggregate purchase price for these properties totaled
approximately $28,521, excluding costs incurred subsequent to the acquisition
of the properties. These acquisitions are as follows:
* On April 10, 1996, the Company purchased four light industrial
properties totaling 212,293 square feet located in Plymouth, Minnesota
for approximately $12,735.
* On June 19, 1996, the Company purchased a 327,997 square foot bulk
warehouse property located in Indianapolis, Indiana for approximately
$5,600.
* On June 25, 1996, the Company purchased a 78,000 square foot light
industrial property located in Milwaukee, Wisconsin for approximately
$2,500.
* On June 26, 1996, the Company purchased a 78,029 square foot light
industrial property located in Chaska, Minnesota for approximately
$2,660.
* On June 28, 1996, the Company purchased four light industrial
properties totaling 180,000 square feet located in Dayton, Ohio for
approximately $3,022 in cash and 84,500 Operating Partnership units
valued at $2,004 in the aggregate ($23.72 per unit).
7. SALES OF REAL ESTATE
On April 4, 1996, the Operating Partnership sold a property located in
suburban Detroit, Michigan. Gross proceeds from the transaction were
approximately $616. The gain on the sale was approximately $186.
On April 26, 1996, the Operating Partnership sold three properties located
in Huntsville, Alabama. Gross proceeds from the transaction were approximately
$10,025. The gain on the sale was approximately $4,105.
On May 31, 1996, the Operating Partnership sold a property located in
Grand Rapids, Michigan. Gross proceeds from the transaction were approximately
$1,478. The gain on the sale was approximately $29.
8. RELATED PARTY TRANSACTIONS
The Company leases office space in Chicago, Illinois from an affiliate of
The Shidler Group at an aggregate annual cost of approximately $131.
9. EMPLOYEE BENEFIT PLANS
The Company maintains a Stock Incentive Plan which is administered by the
Compensation Committee of the Board of Directors. Only officers and other key
employees of the Company and its affiliates generally are eligible to
participate in the Stock Incentive Plan. However, independent Directors of the
Company receive automatic annual grants of options to purchase 7,500 shares at
a per share exercise price equal to the fair market value of a share on the
date of grant.
13
15
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
(UNAUDITED)
The Stock Incentive Plan authorizes (i) the grant of stock options that
qualify as incentive stock options under Section 422 of the Code, (ii) the
grant of stock options that do not so qualify, (iii) restricted stock awards,
(iv) performance share awards and (v) dividend equivalent rights. The exercise
price of stock options will be determined by the Compensation Committee, but
may not be less than 100% of the fair market value of the shares on the date of
grant. Special provisions apply to awards granted under the Stock Incentive
Plan in the event of a change in control in the Company. The Company has
reserved 1,200,000 shares for issuance under the Stock Incentive Plan. At June
30, 1996, options covering 877,500 shares had been granted, remained
outstanding and had not been exercised. During the six months ended June 30,
1996, options covering 37,500 shares were granted, options covering 12,000
shares were terminated and options covering 6,000 shares were exercised.
Options covering 316,500 shares are available for future grants. The following
table details the outstanding options as of June 30, 1996:
Options Granted, Exercise
Unexpired and Options Price
Date of Grant Not Exercised Exercisable Per Share
------------- -------------- ------------- -------
June 23, 1994 528,000 528,000 (1) $23.50
July 30, 1994 37,500 37,500 (2) 23.50
May 26, 1995 37,500 37,500 (3) 18.25
July 17, 1995 237,000 118,500 (4) 20.25
May 22, 1996 37,500 --- (5) 23.50
-------- -------
Total 877,500 721,500
======== =======
(1) Options became exercisable in three equal installments on
December 31, 1994, June 23, 1995 and June 23, 1996.
(2) Options became exercisable on July 30, 1995.
(3) Options became exercisable on May 26, 1996.
(4) Remaining options will become exercisable on July 17, 1996
(5) Options will become exercisable on May 22, 1997.
In 1995, the FASB issued Statement of Financial Accounting Standards No.
123, "Accounting for Stock-Based Compensation" (SFAS 123). Under the
provisions of SFAS 123, companies can elect to account for stock-based
compensation plans using a fair-value-based method or continue measuring
compensation expense for those plans using the intrinsic value based method
prescribed in Accounting Principles Board Opinion No. 25, "Accounting for Stock
Issued to Employees". SFAS 123 requires that companies electing to continue
using the intrinsic value based method must make pro forma disclosures of net
income and earnings per share as if the fair-value-based method of accounting
had been applied.
The Company has elected to continue to account for stock-based
compensation using the intrinsic value method. As such, SFAS 123 did not have
an impact on the Company's second quarter results of operations or financial
position. The pro-forma information required by SFAS 123 will be included in
the footnotes to the Company's 1996 year end consolidated financial statements.
14
16
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
(UNAUDITED)
In September 1994, the Board of Directors approved and the Company adopted
a 401(k)/Profit Sharing Plan. Under the Company's 401(k)/Profit Sharing Plan,
all eligible employees may participate by making voluntary contributions. The
Company may make, but is not required to make matching contributions. For the
three months ended June 30, 1996 and 1995, the Company did not make any
matching contributions. In March 1996, the Board of Directors approved and the
Company adopted a Deferred Income Plan (the "Plan"). Under the Plan, 138,500
unit awards were granted, providing the recipients with deferred income
benefits which vest in three equal annual installments.
10. SUPPLEMENTAL INFORMATION TO STATEMENTS OF CASH FLOWS
Supplemental disclosure of cash flow information:
Six Months Ended
--------------------------------
June 30, 1996 June 30, 1995
------------- -------------
Interest paid, net of capitalized interest............................ $ 14,414 $13,156
========= =======
Interest capitalized.................................................. $ 88 $ 184
========= =======
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND
FINANCING ACTIVITIES:
Distribution payable on common stock/units............................ $ 12,759 $ 9,648
IN CONJUNCTION WITH THE PROPERTY ACQUISITIONS, THE FOLLOWING
LIABILITIES WERE ASSUMED AND OPERATING PARTNERSHIP UNITS EXCHANGED:
Mortgage loans........................................................ 9,417 ---
Operating Partnership units........................................... 14,085 ---
-------- -------
$ 23,502 $ ---
======== =======
11. EXTRAORDINARY ITEM
A portion of the net proceeds from the 1996 Equity Offering was used to
pay off in full and retire the 1995 Acquisition Facility and the Construction
Loans. The resulting write-off of unamortized deferred financing costs and
prepayment fee incurred to retire the 1995 Acquisition Facility and
Construction Loans are shown as an extraordinary loss in the consolidated
statement of operations for the six months ended June 30, 1996.
12. COMMITMENTS AND CONTINGENCIES
In the normal course of business, the Company is involved in legal actions
arising from the ownership of its properties. In management's opinion, the
liabilities, if any, that may ultimately result from such legal actions are not
expected to have a materially adverse effect on the consolidated financial
position, operations or liquidity of the Company.
Sixteen properties have leases granting the tenants options to purchase
the property. Such options are exercisable at various times and at appraised
fair market value or at a fixed purchase price generally in excess of the
Company's purchase price.
The Company has committed to the construction of four light industrial
properties totaling 732,604 square feet. The estimated total construction
costs are approximately $17.2 million. The Company is not acting as the
general contractor for these construction projects.
15
17
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
(UNAUDITED)
13. SUBSEQUENT EVENTS
On July 9, 1996, the Operating Partnership purchased one light industrial
property in Bloomington, Minnesota totaling 125,950 square feet for
approximately $3,512.
On July 10, 1996, the Operating Partnership purchased for approximately
$2,700 approximately 10.7 acres of land in suburban Detroit, Michigan where it
is constructing a 140,365 square foot bulk warehouse facility.
On July 24, 1996, the Operating Partnership purchased one light industrial
property in Indianapolis, Indiana totaling 70,560 square feet for approximately
$1,410.
14. PRO FORMA FINANCIAL INFORMATION
Due to the acquisition of 74 properties between January 1, 1995 and June
30, 1996 and the 1996 Equity Offering, the historical results of operations are
not indicative of future results of operations. The following Pro Forma
Condensed Statements of Operations for the six months ended June 30, 1996 and
1995 are presented as if the property acquisitions and the 1996 Equity Offering
had occurred at January 1, 1995, and therefore include pro forma information.
The pro forma information is based upon historical information and does not
purport to present what actual results would have been had such transactions,
in fact, occurred at January 1, 1995, or to project results for any future
period.
PRO FORMA CONDENSED STATEMENTS OF OPERATIONS
Six Months Ended
--------------------------------
June 30, 1996 June 30, 1995
------------- ------------
Total Revenues.............................................. $69,477 $63,108
Property Expenses........................................... 20,179 17,560
General and Administrative Expense.......................... 1,901 1,465
Interest Expense............................................ 15,285 15,308
Depreciation and Amortization............................... 15,517 15,599
------- -------
Income Before Gain on Sales of Properties,
Minority Interest and Extraordinary Loss.................... 16,595 13,176
Gain on Sales of Properties................................. 4,320 ---
------- -------
Income Before Minority Interest and Extraordinary Loss...... 20,915 13,176
Income Allocated to Minority Interest....................... (1,483) (992)
------- -------
Income Before Extraordinary Loss............................ 19,432 12,184
Extraordinary Loss.......................................... (821) ---
------- -------
Net Income.................................................. 18,611 12,184
Preferred Stock Dividends................................... (1,960) ---
------- -------
Net Income Available to Common Stockholders................. $16,651 $12,184
======= =======
Net Income Per Share........................................ $ .69 $ .51
======= =======
16
18
FIRST INDUSTRIAL REALTY TRUST, INC.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The following discussion and analysis of the Company's financial condition
and results of operations should be read in conjunction with the financial
statements and notes thereto appearing elsewhere in this Form 10-Q.
RESULTS OF OPERATIONS
COMPARISON OF SIX MONTHS ENDED JUNE 30, 1996 TO SIX MONTHS ENDED JUNE 30, 1995
At June 30, 1996, the Company owned 320 in-service properties with
approximately 28.3 million square feet, compared to 261 in-service properties
with approximately 20.8 million square feet at June 30, 1995. The addition of
64 properties acquired or developed between July 1, 1995 and June 30, 1996
included the acquisitions of 61 properties comprising approximately 7.4 million
square feet and the completed construction of 3 build-to-suit properties
containing a total of approximately .4 million square feet. The sale of five
properties comprised of approximately .3 million square feet were also
completed between July 1, 1995 and June 30, 1996.
Revenues increased by $14.0 million or 27.1%, due primarily to the
properties acquired or developed after June 30, 1995. Revenues from properties
owned prior to January 1, 1995, increased by approximately $1.6 million or 3.3%
due to general rent increases and additional tenant recovery income charges for
additional property expenses incurred for the six months ended June 30, 1996.
Property expenses, which include real estate taxes, repairs and
maintenance, property management, utilities, insurance and other expenses,
increased by $5.4 million or 39.3% due primarily to the properties acquired or
developed after June 30, 1995. Expenses from properties owned prior to January
1, 1995, increased by approximately $1.3 million or 10.3% due to additional
snow removal expenses incurred in the Minneapolis and Harrisburg metropolitan
areas and general real estate tax increases.
General and administrative expense increased by $.4 million due primarily
to the additional expenses associated with managing the Company's growing
operations (including additional professional fees relating to additional
properties owned and personnel to manage and expand the Company's business).
Interest expense increased by $.2 million for the six month period ended
June 30, 1996 compared to the six month period ended June 30, 1995. The average
outstanding debt balance was $19.2 million higher during the six months ended
June 30, 1996, due to the additional properties acquired after June 30, 1995,
however, the impact on interest expense was partially offset by lower interest
rates on the 1994 Mortgage Loan as a result of certain interest rate protection
agreements entered into July 1995 (the "Rate Agreements").
Depreciation and other amortization increased by $2.7 million due
primarily to the additional depreciation and amortization related to the
properties acquired after June 30, 1995.
The $4.3 million gain on sales of properties resulted from the sale of
three properties located in Huntsville, Alabama; one property located in
Detroit, Michigan and one property located in Grand Rapids, Michigan. Gross
proceeds for all sales totaled $12.1 million.
The $.8 million extraordinary item in 1996 represents the write-off of
unamortized deferred financing costs and a prepayment fee for loans that were
paid off in full and retired in 1996.
17
19
COMPARISON OF THREE MONTHS ENDED JUNE 30, 1996 TO THREE MONTHS ENDED JUNE 30,
1995
Revenues increased by $8.7 million or 33.1%, due primarily to the
properties acquired or developed after June 30, 1995. Revenues from properties
owned prior to April 1, 1995, increased by approximately $.8 million or 3.4%
due to general rent increases and additional tenant recovery income charges for
additional property expenses incurred for the three months ended June 30, 1996.
Property expenses, which include real estate taxes, repairs and
maintenance, property management, utilities, insurance and other expenses,
increased by $3.2 million or 47.7% due primarily to the properties acquired or
developed after June 30, 1995. Expenses from properties owned prior to April
1, 1995, increased by approximately $.4 million or 5.5% due to general real
estate tax increases.
General and administrative expense increased by $.2 million due primarily
to the additional expenses associated with managing the Company's growing
operations (including additional professional fees relating to additional
properties owned and personnel to manage and expand the Company's business).
Interest expense increased by $.2 million for the three month period ended
June 30, 1996 compared to the three month period ended June 30, 1995. The
average outstanding debt balance was $23.4 million higher during the three
months ended June 30, 1996, due to the additional properties acquired after
June 30, 1995, however, the impact on interest expense was partially offset by
lower interest rates on the 1994 Mortgage Loan as a result of the Rate
Agreements.
Depreciation and other amortization increased by $1.5 million due
primarily to the additional depreciation and amortization related to the
properties acquired after June 30, 1995.
The $4.3 million gain on sales of properties resulted from the sale of
three properties located in Huntsville, Alabama; one property located in
Detroit, Michigan and one property located in Grand Rapids, Michigan. Gross
proceeds for all sales totaled $12.1 million.
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 1996, the Company's unrestricted cash and cash equivalents was
$5.5 million and restricted cash was $9.0 million. Restricted cash includes
reserves required to be set aside under certain of the Company's loans for
payments of security deposit refunds, tenant improvements, capital
expenditures, interest, real estate taxes, insurance and potential
environmental costs. A portion of the cash reserve relating to payments for
tenant improvements, capital expenditures and potential environmental costs was
established at the closing of the $300 million mortgage loan (the "1994
Mortgage Loan") and is distributed to the Company as such expenditures are
made, and is not required to be replenished to its original level. The portion
of the cash reserve on the 1994 Mortgage Loan relating to payments for
interest, real estate taxes and insurance is established monthly, distributed
to the Company as such expenditures are made and is replenished to a level
adequate to make the next periodic payment of such expenditures. The portion
of the cash reserve relating to security deposit refunds on the $40 million
mortgage loan ("1995 Mortgage Loan") is adjusted as tenants turnover. The
portion of the cash reserve relating to payments for capital expenditures,
interest, real estate taxes and insurance on the 1995 Mortgage Loan is
established monthly, distributed to the Company as such expenditures are made
and is replenished to a level adequate to make the next periodic payment of
such expenditures.
Net cash provided by operating activities was $34.2 million for the six
months ended June 30, 1996 compared to $20.2 million for the six months ended
June 30,1995. This increase is due primarily to the operations from the
acquisition or development of properties between July 1, 1995 and June 30,
1996.
Net cash used in investing activities increased to $120.6 million from
$50.1 million due to an increase in the acquisition of properties. Net cash
provided by financing activities increased to $83.0 million from $28.6 million
primarily due to the Company's issuance of 5,175,000 shares of $.01 par value
common stock
18
20
in February 1996 (the "1996 Equity Offering"), the consummation of
a $36.7 million mortgage loan offset by a net decrease in acquisition line
borrowings.
Funds from operations for the six months ended June 30, 1996 were $26.9
million, as compared to $19.6 million for the six months ended June 30, 1995,
as a result of the factors discussed in the analysis of operating results
above. Management considers funds from operations to be one measure of the
financial performance of an equity REIT that provides a relevant basis for
comparison among REITs and it is presented to assist investors in analyzing the
performance of the Company. Funds from operations is equal to net income,
excluding gains (or losses) from debt restructuring and sales of property, plus
depreciation and amortization, excluding amortization of deferred financing
costs and interest rate protection agreements, and after adjustments for
unconsolidated partnerships and joint ventures. Funds from operations does not
represent cash generated from operating activities in accordance with generally
accepted accounting principles and is not necessarily indicative of cash
available to fund cash needs, including the payment of dividends and
distributions. Funds from operations should not be considered as a substitute
for net income as a measure of results of operations or for cash flow from
operating activities calculated in accordance with generally accepted
accounting principles as a measure of liquidity.
On January 22, 1996, the Company and Operating Partnership paid a fourth
quarter 1995 distribution of 48.75 cents per common share/unit, totaling
approximately $10.4 million. On April 22, 1996, the Company and Operating
Partnership paid a first quarter 1996 distribution of 48.75 cents per
share/unit, totaling approximately $12.5 million. On July 22, 1996, the
Company and Operating Partnership paid a second quarter 1996 distribution of
48.75 cents per common share/unit, totaling approximately $12.8 million. On
January 2, 1996, the Company paid a preferred stock dividend of 28.37 cents per
share, totaling approximately $.5 million. On March 29, 1996, the Company paid
a preferred stock dividend of 59.375 cents per share, totaling approximately
$1.0 million. On June 28, 1996, the Company paid a preferred stock dividend of
59.375 cents per share, totaling approximately $1.0 million.
Between January 1, 1996 and June 30, 1996, the Company purchased 54
industrial properties comprising approximately 6.0 million square feet and one
11.3 acre parcel of land for an aggregate purchase price of approximately
$144.8 million. The Company also sold 5 properties comprising approximately .3
million square feet and continued or began construction on 4 light industrial
properties comprising .7 million square feet. The acquisitions and development
activity were financed with proceeds from the 1996 Equity Offering, borrowings
under the Company's $150 million collateralized acquisition facility ("1994
Acquisition Facility") and $46.2 million of indebtedness incurred or assumed in
connection with property acquisitions.
The Company has considered its short-term liquidity needs and the adequacy
of its estimated cash flow from operations and other expected liquidity sources
to meet these needs. The Company believes that its principal short-term
liquidity needs are to fund normal recurring expenses, debt service
requirements and the minimum distribution required to maintain the Company's
REIT qualification under the Internal Revenue Code. The Company anticipates
that these needs will be met with cash flows provided by operating activities.
The Company expects to meet long-term liquidity requirements such as
property acquisitions, scheduled debt maturities, major renovations, expansions
and other nonrecurring capital improvements through long-term secured and
unsecured indebtedness and the issuance of additional equity securities. The
Company may finance the development or acquisition of additional properties
through borrowings under the 1994 Acquisition Facility. At June 30, 1996,
borrowings under the 1994 Acquisition Facility bore interest at a weighted
average interest rate of 7.5%. As of June 30, 1996, including properties in
the process of being added to the collateral base, the Company had
approximately $60 million available in additional borrowings under the 1994
Acquisition Facility. While the Company may sell properties if property or
market conditions make it desirable, the Company does not expect to sell assets
in the foreseeable future to satisfy its liquidity requirements.
19
21
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On May 21, 1996, the Company held its Annual Meeting of Stockholders.
At the meeting, three Class II directors of the Company were elected to
serve until the 1999 Annual Meeting of Stockholders and until their respective
successors are duly elected and qualified. The votes cast for each director
were:
For election of Michael G. Damone:
Votes for: 21,918,020
Votes withheld: 62,654
For election of Kevin W. Lynch:
Votes for: 21,918,170
Votes withheld: 62,504
For election of Michael W. Brennan:
Votes for: 21,433,290
Votes withheld: 547,384
In addition, the stockholders approved an amendment to amend the Company's
Amended and Restated Articles of Incorporation to increase the maximum number
of members of the Company's Board of Directors from nine (9) to twelve (12)
with 21,161,285 shares voting in favor, 732,474 shares voting against and
86,915 shares abstaining.
In addition, the appointment of Coopers & Lybrand L.L.P. as independent
auditors of the Company for the fiscal year ending December 31, 1996 was
ratified at the meeting with 21,911,859 shares voting in favor, 22,463 shares
voting against and 46,352 shares abstaining.
ITEM 5. OTHER INFORMATION
Not applicable.
20
22
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
Exhibits
Exhibit No. Description
----------- ------------
3.1 Amended and Restated Articles of Incorporation
3.2 Articles of Amendment dated June 20, 1994
3.3 Articles of Amendment dated May 31, 1996
3.4 Articles Supplementary relating to the Company's 9.5% Series A Cumulative
Preferred Stock
10.1 First Amendment to Second Amended and Restated Limited Partnership
Agreement of First Industrial, L.P. dated November 17, 1995
10.2 Second Amendment to Second Amended and Restated Limited Partnership
Agreement of First Industrial, L.P. dated March 20, 1996
10.3 Third Amendment to Second Amended and Restated Limited Partnership
Agreement of First Industrial, L.P. dated June 28, 1996
27 Financial Data Schedule
Reports on Form 8-K and Form 8-K/A:
Report on Form 8-K dated March 20, 1996, as amended by report on Form
8-K/A No. 1 filed May 17, 1996, relating to the acquisition of 47 industrial
properties. The reports included Combined Historical Statements of Revenues
and Certain Expenses for the acquired properties and Pro Forma Statements of
Operations for First Industrial Realty Trust, Inc.
- -------------------------------------------------------------------------------
The Company has prepared supplemental financial and operating information
which is available without charge upon request to the Company. Please direct
requests as follows:
First Industrial Realty Trust, Inc.
150 N. Wacker, Suite 150
Chicago, IL 60606
Attention: Investor Relations
21
23
SIGNATURE
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, thereunto duly authorized.
FIRST INDUSTRIAL REALTY TRUST, INC.
Date: August 14, 1996 By: /s/ Michael J. Havala
-------------------------------
Michael J. Havala
Chief Financial Officer
(Principal Financial and Accounting
Officer)
22
24
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
EX-3.1 Amended and Restated Articles of Incorporation
EX-3.2 Articles of Amendment dated June 20, 1994
EX-3.3 Articles of Amendment dated May 31, 1996
EX-3.4 Articles Supplementary relating to the Company's 9.5% Series A Cumulative
Preferred Stock
EX-10.1 First Amendment to Second Amended and Restated Limited Partnership
Agreement of First Industrial, L.P. dated November 17, 1995
EX-10.2 Second Amendment to Second Amended and Restated Limited Partnership
Agreement of First Industrial, L.P. dated March 20, 1996
EX-10.3 Third Amendment to Second Amended and Restated Limited Partnership
Agreement of First Industrial, L.P. dated June 28, 1996
EX-27 Financial Data Schedule
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EXHIBIT 3.1
ARTICLES OF AMENDMENT AND RESTATEMENT
OF
FIRST INDUSTRIAL REALTY TRUST, INC.
THIS IS TO CERTIFY THAT:
FIRST: First Industrial Realty Trust, Inc., with its
principal office in the State of Maryland and its resident agent as set forth
below in ARTICLES IV and V, respectively, of these Articles of Amendment and
Restatement, hereby certifies that the Articles of Incorporation of the
Corporation, filed with the Secretary of State on August 10, 1993, and as
amended on April 18, 1994, are hereby amended and restated as set forth in
these Articles of Amendment and Restatement.
SECOND: The following provisions are all of the provisions of
the charter currently in effect as hereinafter amended:
ARTICLE I
INCORPORATION, AMENDMENT AND RESTATEMENT
Roger S. Chari, whose post office address is c/o Cahill Gordon
& Reindel, 80 Pine Street, New York, NY 10005, being at least eighteen (18)
years of age, does hereby form a corporation (the "Corporation") under the
general laws of the State of Maryland.
ARTICLE II
NAME
The name of the corporation is:
"First Industrial Realty Trust, Inc."
ARTICLE III
PURPOSES
3.1 General Purposes. The purpose for which the Corporation
is formed and the business or objects to be carried
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on and promoted by it, within the State of Maryland or elsewhere, are to engage
in any lawful act or activity for which corporations may be formed under the
Maryland General Corporation law, as amended from time to time.
3.2 REIT Qualification. Without limiting the generality of
the foregoing purpose, business and objects, at such time or times as the Board
of Directors of the Corporation determines that it is in the interest of the
Corporation and its stockholders that the Corporation engage in the business
of, and conduct its business and affairs so as to qualify as, a real estate
investment trust ("REIT") under Sections 856 through 860 of the Internal
Revenue Code of 1986, as amended, or any successor statute (the "Code"), the
purpose of the Corporation shall include engaging in the business of a real
estate investment trust ("REIT"). This reference to such purpose shall not
make unlawful or unauthorized any otherwise lawful act or activity that the
Corporation may take that is inconsistent with such purpose.
ARTICLE IV
PRINCIPAL OFFICE ADDRESS
The address of the principal office of the Corporation in the
State of Maryland is c/o The Corporation Trust Incorporated, 32 South Street,
Baltimore, Maryland 21202.
ARTICLE V
RESIDENT AGENT
The Resident Agent of the Corporation is The Corporation Trust
Incorporated, whose address is 32 South Street, Baltimore, Maryland 21202.
Said Resident Agent is a Maryland corporation.
ARTICLE VI
BOARD OF DIRECTORS
6.1 Composition. The Corporation shall have a Board of
Directors initially consisting of three (3) Directors, whose names are Jay
Shidler, Paul T. Lambert and Michael T. Tomasz, which number may be increased
in accordance with the Bylaws of
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the Corporation, but shall not be less than the number required by Section
2-402 of the Maryland General Corporation Law nor more than nine (9).
Commencing on the date of the sale of shares of Common Stock (the "Initial
Public Offering Date") pursuant to the Corporation's first effective
registration statement for Common Stock filed with the Securities and Exchange
Commission under the Securities Act of 1933, the Board of Directors shall
consist of nine (9) Directors, a majority of which shall be Independent
Directors. For purposes hereof, "Independent Director" shall mean a Director
of the Corporation who is neither employed by the Corporation nor a member (or
an affiliate or employee of a member) of The Shidler Group (as such term may be
defined in such above-mentioned registration statement).
6.2 The Board of Directors of the Corporation shall be
divided into three classes, each class to consist as nearly as possible of
one-third of the Directors. The term of office of one class of Directors shall
expire each year. The initial term of office of the first class shall expire
at the 1995 annual meeting of stockholders. The initial term of office of the
second class shall expire at the 1996 annual meeting of stockholders. The
initial term of office of the third class shall expire t the 1997 annual
meeting of stockholders. Commencing with the 1995 annual meeting of
stockholders, the Directors of the class elected at each annual meeting of
stockholders shall hold office for a term of three years. Vacancies occurring
by resignation, enlargment of the Board of Directors or otherwise shall be
filled as specified in the Bylaws.
ARTICLE VII
AUTHORIZED CAPITAL STOCK; RIGHTS AND
PREFERENCES; ISSUANCE OF STOCK
7.1 Authorized Capital Stock. The total number of shares of
stock which the Corporation has authority to issue (the "Stock") is one hundred
seventy-five million (175,000,000) shares, consisting of (i) ten million
(10,000,000) shares of preferred stock, par value $.01 per share ("Preferred
Stock"); (ii) one hundred million (100,000,000) shares of common stock, par
value $.01 per share ("Common Stock"); and (iii) sixty-five million
(65,000,000) shares of excess stock, par value $.01 per share ("Excess Stock").
The aggregate par value of all the shares of all classes of Stock is
$1,750,000."
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7.2 Preferred Stock. The Board of Directors may issue the
Preferred Stock in one or more series consisting of such numbers of shares and
having such preferences, conversion and other rights, voting powers,
restrictions and limitations as to dividends, qualifications and terms and
conditions of redemption of stock as the Board of Directors may from time to
time determine when designating such series.
7.3 Common Stock.
7.3.1 Dividend Rights. The holders of shares of Common
Stock shall be entitled to receive such dividends as may be declared by the
Board of Directors out of funds legally available therefor.
7.3.2 Rights Upon Liquidation. In the event of any
voluntary or involuntary liquidation, dissolution or winding up of, or any
distribution of the assets of, the Corporation, each holder of shares of Common
Stock shall be entitled to receive, ratably with each other holder of shares of
Common Stock or Excess Stock resulting from the exchange of Common Stock
("Excess Common Stock"), that portion of the assets of the Corporation
available for distribution to the holders of its Common Stock and Excess Common
Stock as the number of shares of Common Stock held by such holder bears to the
total number of shares of Common Stock and Excess Common Stock then
outstanding.
7.3.3 Voting Rights. Subject to the provisions of
Section 9 hereof regarding Excess Stock, the holders of shares of Common Stock
shall be entitled to vote on all matters submitted to the holders of shares of
Common Stock for a vote, at all meetings of the stockholders, and each holder
of shares of Common Stock shall be entitled to one vote for each share of
Common Stock held by such stockholder.
7.3.4 Exchange. Shares of Common Stock shall
automatically be exchanged for shares of Excess Stock at the times and in the
manner provided in Subsection 9.5.1 hereof.
7.4 Excess Stock. Shares of Excess Stock shall be a separate
class of issued and outstanding stock of the Corporation. The voting,
distribution, redemption and certain other rights, qualifications and
limitations of shares of Excess Stock are set forth in Section 9.5 hereof.
7.5 Classification of Stock. The Board of Directors may
classify or reclassify any unissued shares of Stock from time to time by
setting or changing the preferences, conversion and
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other rights, voting powers, restrictions and limitations as to dividends,
qualifications and terms and conditions of redemption of those shares of Stock,
including, but not limited to, the reclassification of unissued shares of
Common Stock to shares of Preferred Stock or unissued shares of Preferred Stock
to shares of Common Stock or the issuance of any rights plan or similar plan.
7.6 Issuance of Stock. The Board of Directors may authorize
the issuance from time to time of shares of Stock of any class, whether now or
hereafter authorized, or securities or rights convertible into shares of Stock,
for such consideration as the Board of Directors may deem advisable (or without
consideration in the case of a share split or dividend), subject to such
restrictions or limitations, if any, as may be set forth in the Bylaws of the
Corporation.
ARTICLE VIII
LIMITATION ON PREEMPTIVE RIGHTS
No stockholder shall have any preferential or preemptive right
to acquire additional shares of Stock, except to the extent that, and on such
terms as, the Board of Directors from time to time may determine.
ARTICLE IX
LIMITATIONS ON TRANSFER AND OWNERSHIP
9.1 Limitations on Transfer. The shares of Stock (other than
Excess Stock) shall be freely transferable by the record owner thereof, subject
to the provisions of Section 9.2 hereof and provided that any purported
acquisition or transfer of Stock that would result in the disqualification of
the Corporation as a REIT shall be void ab initio. Any purported transfer of
Stock that, if effective, would result in a violation of Section 9.2 hereof
(unless excepted from the application of Section 9.2 pursuant to Section 9.6
hereof) shall be void ab initio as to the transfer of that number of shares of
Stock that otherwise would be beneficially owned by a stockholder in violation
of Section 9.2 hereof. The intended transferee of such shares shall acquire no
rights therein and the transfer of such shares will not be reflected on the
Corporation's stock record books. For purposes of this Article IX, a
"transfer" of shares of Stock shall mean any sale, transfer, gift,
hypothecation,
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pledge, assignment, devise or other disposition, whether voluntary or
involuntary, by operation of law or otherwise.
9.2 Limitations on Ownership. Commencing on the Initial
Public Offering Date, or such earlier time as the Board of Directors may
determine, except as provided by Section 9.6 hereof, ownership of the Stock
shall be limited as follows:
9.2.1 No person shall at any time directly or indirectly
acquire or hold beneficial ownership of shares of Stock with an
aggregate value in excess of 9.9% of the aggregate value of all
outstanding Stock (the "Ownership Limit");
9.2.2 Any transfer that, if effective, would result in the
Stock being beneficially owned by less than 100 persons (determined
without reference to any rules of attribution) shall be void ab initio
as to the transfer of such shares of Stock which otherwise would be
beneficially owned by the transferee; and the intended transferee
shall acquire no rights in such shares of Stock; and
9.2.3 Any transfer that, if effective, would result in the
Corporation being "closely held" within the meaning of Section 856(h)
of the Code shall be void ab initio as to the transfer of the shares
of Stock which would cause the Corporation to be "closely held" within
the meaning of Section 856(h) of the Code; and the intended transferee
shall acquire no rights in such shares of Stock.
For purposes of this Article IX, (a) the value of any share of Stock shall be
determined in the manner established by the Board of Directors and (b) a person
(which includes natural persons, corporations, trusts, partnerships and other
entities) shall be deemed to be the beneficial owner of the shares of Stock
that such person (i) actually owns, (ii) constructively owns after applying the
rules of Section 544 of the Code as modified in the case of a REIT by Section
856(h) of the Code and Section 318 of the Code as modified in the case of a
REIT by Section 856(d) of the Code and (iii) has the right to acquire upon
exercise of outstanding rights, options and warrants, and upon conversion of
any securities convertible into Stock, if any.
9.3 Stockholder Information. Each stockholder shall, upon
demand of the Corporation, disclose to the Corporation in writing such
information with respect to his or its direct, indirect and constructive
beneficial ownership of the Stock and other matters as the Board of Directors
in its discretion deems
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necessary or appropriate in order that the Corporation may fully comply with
all provisions of the Code relating to REITs and all regulations, rulings and
cases promulgated or decided thereunder (the "REIT Provisions") and to comply
with the requirements of any taxing authority or governmental agency or to
determine any such compliance.
9.4 Transferee Information. Whenever the Board of Directors
deems it reasonably necessary to protect the tax status of the Corporation as a
REIT under the REIT Provisions, the Board of Directors may require a statement
or affidavit from each stockholder or proposed transferee of Stock setting
forth the number of shares of Stock already beneficially owned by such proposed
transferee and any related person specified by the Board of Directors. Any
person who acquires or attempts to acquire shares in violation of Section 9.2
hereof, or any person who is a transferee such that Excess Stock is required to
be issued under Section 9.5 hereof, shall immediately give written notice to
the Corporation of such event and shall provide to the Corporation such other
information as the Corporation may request in order to determine the effect, if
any, of such transfer or attempted transfer on the Corporation's qualification
as a REIT. If, in the opinion of the Board of Directors, any proposed transfer
may jeopardize the qualification of the Corporation as a REIT, the Board of
Directors shall have the right, but not the duty, to refuse to permit the
transfer of such Stock to the proposed transferee. All contracts for the sale
or other transfer of Stock shall be subject to this Section 9.4.
9.5 Excess Stock.
9.5.1 Exchange for Excess Stock. If, notwithstanding
the other provisions contained in this Article IX, at any time after the
Initial Public Offering Date there is a purported transfer of Stock or a change
in the capital structure of the Corporation (including any redemption of Excess
Stock pursuant to Subsection 9.5.7 hereof) such that any person would
beneficially own Stock in excess of the Ownership Limit or the Corporation
would become "closely held" within the meaning of Section 856(h) of the Code,
then, except as otherwise provided in Section 9.6 hereof, there shall be
automatically exchanged for an equal number of shares of Excess Stock (a) such
shares of Stock purported to be transferred which, if transferred, would cause
the transferee to hold Stock in excess of the Ownership Limit or (b) the
smallest number of shares after the conversion of which the Corporation would
continue not to be "closely held", as the case may be (in each case, rounded up
to the nearest whole number). Each such exchange shall be effective as of the
close
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of business on the business day prior to the date of the purported transfer of
Stock or the change in capital structure.
9.5.2 Ownership in Trust. Upon any purported transfer
of Stock or change in capital structure that results in the issuance of Excess
Stock pursuant to Subsection 9.5.1 hereof, such Excess Stock shall be deemed to
have been transferred to the Corporation, as trustee of a separate trust for
the exclusive benefit of the person or persons to whom such Excess Stock can
ultimately be transferred without violating the Ownership Limit. Shares of
Excess Stock so held in trust shall be issued and outstanding Stock of the
Corporation under the Maryland General Corporation Law. No purported
transferee of Excess Stock shall have rights in such Excess Stock, except the
right to designate a transferee of its interest in the trust created under this
Subsection 9.5.2 upon the terms specified in Subsection 9.5.6 hereof. If any
of the restrictions on transfer set forth in this Article IX are determined to
be void, invalid or unenforceable by virtue of any legal decision, statute,
rule or regulation, then the intended transferee of any Excess Stock may be
deemed, at the option of the Corporation, to have acted as an agent on behalf
of the Corporation in acquiring the Excess Stock and to hold the Excess Stock
on behalf of the Corporation.
9.5.3 Dividend Rights. Excess Stock shall not be
entitled to any dividends. Any dividend or distribution paid prior to the
discovery by the Corporation that shares of Stock have been exchanged for
Excess Stock shall be repaid to the Corporation upon demand, and any dividend
or distribution declared but unpaid shall be rescinded as void ab initio with
respect to such shares of Excess Stock.
9.5.4 Rights Upon Liquidation. In the event of any
voluntary or involuntary liquidation, dissolution or winding up of, or any
distribution of the assets of, the Corporation, each holder of shares of Excess
Stock resulting from the exchange of Common Stock ("Excess Common Stock") shall
be entitled to receive, ratably with each other holder of shares of Common
Stock or Excess Common Stock, that portion of the assets of the Corporation
available for distribution to the holders of Common Stock and Excess Common
Stock as the number of shares of Excess Common Stock held by such holder bears
to the total number of shares of Common Stock and Excess Common Stock then
outstanding. In the event of any voluntary or involuntary liquidation,
dissolution or winding up of, or any distribution of the assets of, the
Corporation, each holder of shares of Excess Stock resulting from the exchange
of Preferred Stock ("Excess Preferred Stock") shall be entitled to receive the
pro rata share of the
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assets of the Corporation available for distribution to the holders of
Preferred Stock of the series from which such Excess Stock was exchanged which
such holder of Excess Preferred Stock would be entitled to receive if such
shares of Excess Preferred Stock were shares of Preferred Stock of the series
from which such Excess Preferred Stock was exchanged. The Corporation, as the
holder of all Excess Stock in one or more trusts or, if the Corporation shall
have been dissolved, any trustee appointed by the Corporation prior to its
dissolution, shall distribute to the transferee of an interest in such a trust
pursuant to Subsection 9.5.6 hereof, when determined, any assets received in
any liquidation, dissolution or winding up of, or any distribution of the
assets of, the Corporation in respect of the Excess Stock held in such trust
and represented by the trust interest transferred to such transferee.
9.5.5 Voting Rights. No stockholder may vote any
shares of Excess Stock. The shares of Excess Stock will not be considered for
purposes of any stockholder vote or for purposes of determining a quorum for
such a vote.
9.5.6 Restriction on Transfer. Excess Stock shall not
be transferable. The purported transferee of any shares of Stock that are
exchanged for Excess Stock pursuant to Section 9.5.1 hereof may freely
designate a transferee of the interest in the trust that represents such shares
of Excess Stock, if (a) the shares of Excess Stock held in the trust and
represented by the trust interest to be transferred would not, if purported to
be transferred as Stock other than Excess Stock to the transferee of the trust
interest, be required to be converted into Excess Stock and (b) the transferor
of the trust interest does not receive a price for the trust interest in excess
of (i) the price such transferor paid for the Stock in the purported transfer
of Stock that resulted in the Excess Stock represented by the trust interest or
(ii) if such transferor did not give value for such Stock (e.g., the shares
were received through a gift, devise or other similar transaction), a price
equal to the aggregate Market Price (as defined in Subsection 9.5.7 hereof) for
all shares of Stock that were exchanged for Excess Stock on the date of the
purported transfer that resulted in the Excess Stock. No interest in a trust
may be transferred unless the transferor of such interest has given advance
notice to the Corporation of the intended transferee and the Corporation has
agreed in writing to waive its redemption rights under Subsection 9.5.7 hereof.
Upon the transfer of an interest in a trust in compliance with this Subsection
9.5.6, the corresponding shares of Excess Stock that are represented by the
transferred interest in the trust shall be automatically exchanged for an equal
number
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of shares of Stock of the same class and series from which they were originally
exchanged and such shares of Stock shall be transferred of record to the
transferee of the interest in the trust. Upon any exchange of Excess Stock for
Stock of another class, the interest in the trust representing such Excess
Stock shall automatically terminate. The Corporation shall remit to the
purported transferee an amount equal to the net proceeds realized from any sale
or other disposition of a trust interest pursuant to this Section.
9.5.7 Corporation's Redemption Right. All shares of
Excess Stock shall be deemed to have been offered for sale to the Corporation,
or its designee, at a price per share equal to the lesser of (a) the price per
share of Stock in the transaction that created such Excess Stock (or, in the
case of gift, devise or other similar transaction, the Market Price per share
of such Stock at the time of such gift, devise or other similiar transaction)
or (b) the Market Price per share of Stock of the class and series of Stock
from which such Excess Stock was exchanged on the date the Corporation, or its
designee, accepts such offer. The Corporation shall have the right to accept
such offer for a period of ninety (90) days after (i) the date of the
purported transfer that resulted in such Excess Stock if the purported
transferee notified the Corporation of such purported transfer within ten (10)
days thereof or (ii) the date on which the Board of Directors makes a
determination that the purported transfer resulting in Excess Stock occurred if
the Corporation is not notified of the purported transfer. For purposes of
this Article IX, "Market Price" means, for any share of Stock, the average
daily per share closing sales price of a share of such Stock if shares of such
Stock are listed on a national securities exchange or quoted on the National
Association of Securities Dealers Automated Quotation National Market System
(the "NASDAQ NMS") and, if such shares are not so listed or quoted, the Market
Price shall be the mean between the average per share closing bid prices and
the average per share closing asked prices, in each case during the 30-day
period ending on the business day prior to the redemption date or, if there
have been no sales on a national securities exchange or on the NASDAQ NMS and
no published bid and asked quotations with respect to shares of such Stock
during such 30-day period, the Market Price shall be the price determined by
the Board of Directors in good faith. Unless the Board of Directors determines
that it is in the interest of the Corporation to make earlier payment of all of
the amount determined as the redemption payment for Stock redeemed in
accordance with this Subsection 9.5.7, the redemption payment shall be paid to
the transferee of the trust interest representing the redeemed Excess Stock
only upon the liquidation
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of the Corporation and shall not exceed an amount equal to the lesser of the
price determined pursuant to the first sentence of this Subsection 9.5.7 and
the product of (x) the number of shares of Excess Stock redeemed, multiplied by
(y) the sum of the per share distributions designated as liquidating
distributions and return of capital distributions declared subsequent to the
redemption date with respect to unredeemed shares of Stock of the class and
series for which the redeemed Excess Stock was exchanged. No interest shall
accrue on any redemption payment with respect to the period subsequent to the
redemption date to the date of the redemption payment.
9.6 Exceptions to Certain Ownership and Transfer Limitations.
The Ownership Limit set forth in Section 9.2 shall not apply to the following
shares of Stock and such shares shall not be deemed to be Excess Stock at the
times and subject to the terms and conditions set forth in this Section 9.6:
9.6.1 Subject to the provisions of Section 9.7 hereof, shares
of Stock which a majority of Independent Directors may exempt from the
Ownership Limit upon receipt by such Independent Directors of evidence
satisfactory to them and, to the Corporation's tax counsel that a
change in the Ownership Limit will not then or in the future
jeopardize the Corporation's status as a REIT. Such evidence may
include a ruling from the Internal Revenue Service or an opinion of
counsel.
9.6.2 Subject to the provisions of Section 9.7 hereof, shares
of Stock acquired and held by an underwriter in a public offering of
Stock, or in any transaction involving the issuance of Stock by the
Corporation in which the Board of Directors determines that the
underwriter or other person or party initially acquiring such Stock
will make a timely distribution of such Stock to or among other
holders such that, following such distribution, the Corporation will
continue to be in compliance with the REIT Provisions.
9.6.3 Shares of Stock acquired pursuant to an all cash tender
offer made for all outstanding shares of Stock of the Corporation in
conformity with applicable federal and state securities laws where not
less than two-thirds of the outstanding Stock (not including Stock or
securities convertible into Stock held by the tender offeror and/or
any "affiliates" or "associates" thereof within the meaning of the
Securities Exchange Act of 1934) is duly tendered and accepted
pursuant to the cash tender offer and where the tender offeror commits
in such tender offer, if the tender
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offer is so accepted by the holders of not less than two-thirds of the
outstanding Stock, as promptly as practicable thereafter to give any
holders who did not accept such tender offer a reasonable opportunity
to put their Stock to the tender offeror at a price not less than the
price per share paid for Stock tendered pursuant to the tender offer.
9.7 Authority to Revoke Exceptions to Limitations. The Board
of Directors, in its sole discretion, may at any time revoke any exception
pursuant to Subsection 9.6.1 or 9.6.2 hereof in the case of any stockholder,
and upon such revocation, the provisions of Sections 9.2 and 9.5 hereof shall
immediately become applicable to such stockholder and all Stock of which such
stockholder may be the beneficial owner. A decision to exempt or refuse to
exempt from the Ownership Limit the ownership of certain designated shares of
Stock, or to revoke an exemption previously granted, shall be made by the Board
of Directors in its sole discretion, based on any reason whatsoever, including,
but not limited to, the preservation of the Corporation's qualification as a
REIT.
9.8 Severability. If any provisions of this Article IX or
any application of any such provision is determined to be invalid by any
federal or state court having jurisdiction, the validity of the remaining
provisions of this Article IX shall not be affected and other applications of
such provision shall be affected only to the extent necessary to comply with
the determination of such court. To the extent this Article IX may be
inconsistent with any other provision of these Articles of Incorporation, this
Article IX shall be controlling.
9.9 Modifications.
9.9.1 Modification of Ownership Limit. Subject to
the limitations provided in subsection 9.9.2 hereof, the Board of Directors
may from time to time increase the Ownership Limit.
9.9.2 Limitations on Modifications. The following
limitations shall apply to the modification of the Ownership Limit:
(a) The Ownership Limit may not be increased
if, after giving effect to such increase, five beneficial owners could
beneficially own, in the aggregate, more than 50.0% of the outstanding Stock.
(b) Prior to the modification of the Ownership
Limit, the Board of Directors of the Corporation may
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require such opinions of counsel, affidavits, undertakings or agreements as it
may deem necessary or advisable in order to determine or ensure the
Corporation's status as a REIT.
9.10 Legend. Each certificate for Stock shall bear the
following legend:
'The shares of Stock represented by this certificate are
subject to restrictions on transfer for the purpose of the Corporation's
maintenance of its qualification as a Real Estate Investment Trust under the
Internal Revenue Code of 1986, as amended. No person may beneficially own
shares of Stock in excess of 9.9% (or such greater percentage as may be
determined by the Board of Directors of the Corporation) of the outstanding
Stock of the Corporation. Any person who attempts to beneficially own shares
of Stock in excess of the above limitation must immediately notify the
Corporation. All capitalized terms in this legend have the meanings defined in
the Corporation's articles of incorporation, a copy of which, including the
restrictions on transfer, will be sent without charge to each stockholder who
so requests. If the restrictions on transfer are violated, the shares of Stock
represented hereby may be automatically exchanged for shares of Excess Stock
which will be held in trust by the Corporation.'
9.11 Authority of the Board of Directors. Nothing contained
in this Article IX (subject to Section 9.12 below) or in any other provision of
these Articles of Incorporation shall limit the authority of the Board of
Directors to take such action as it deems necessary or advisable to protect the
Corporation and the interests of the stockholders by preservation of the
Corporation's qualification as a REIT under the REIT Provisions. In applying
the provisions of this Article IX, the Board of Directors may take into account
the lack of certainty in the REIT Provisions relating to the ownership of stock
that may prevent a corporation from qualifying as a REIT and may make
interpretations concerning the Ownership Limit, Excess Stock, beneficial
ownership and related matters on as conservative a basis as the Board of
Directors deems advisable to minimize or eliminate uncertainty as to the
Corporation's continued qualification as a REIT. Notwithstanding any other
provision of these Articles of Incorporation, if the Board of Directors
determines that it is no longer in the best interests of the Corporation and
the stockholders to continue to have the Corporation qualify as a REIT, the
Board of Directors may revoke or otherwise terminate the Corporation's REIT
election pursuant to Section 856(g) of the Code.
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9.12 New York Stock Exchange. Nothing in this Article IX
shall preclude the settlement of any transaction entered into through the
facilities of the New York Stock Exchange; provided that as set forth in this
Article IX, certain transactions may be settled by providing Excess Stock."
ARTICLE X
RIGHTS AND POWERS OF CORPORATION,
BOARD OF DIRECTORS AND OFFICERS
In carrying on its business, or for the purpose of attaining
or furthering any of its objects, the Corporation shall have all of the rights,
powers and privileges granted to corporations by the laws of the State of
Maryland, as well as the power to do any and all acts and things that a natural
person or partnership could do as now or hereafter authorized by law, either
alone or in partnership or conjunction with others. In furtherance and not in
limitation of the powers conferred by statute, the powers of the Corporation
and of the Directors and stockholders shall include the following:
10.1 Any Director or officer individually, or any firm of
which any Director or officer may be a member, or any corporation or
association of which any Director of officer may be a director or officer or in
which any Director or officer may be interested as the holder of any amount of
its capital stock or otherwise, may be a party to, or may be pecuniarily or
otherwise interested in, any contract or transaction of the Corporation, and,
in the absence of fraud, no contract or other transaction shall be thereby
affected or invalidated; provided, however, that (a) such fact shall have been
disclosed or shall have been known to the Board of Directors or the committee
thereof that approved such contract or transaction and such contract or
transaction shall have been approved or satisfied by the affirmative vote of a
majority of the disinterested Directors, or (b) such fact shall have been
disclosed or shall have been known to the stockholders entitled to vote, and
such contract or transaction shall have been approved or ratified by a majority
of the votes cast by the stockholders entitled to vote, other than the votes of
shares owned of record or beneficially by the interested Director, officer or
corporation, firm or other entity, or (c) the contract or transaction is fair
and reasonable to the Corporation.
10.2 The Corporation reserves the right, from time to time,
to make any amendment to its Articles of Incorporation now or hereafter
authorized by law, including any amendment which
15
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alters the contract rights, as expressly set forth in its Articles of
Incorporation, of any outstanding Stock.
10.3 Except as otherwise provided in the Articles of
Incorporation or the Bylaws of the Corporation, as amended from time to time,
the business of the Corporation shall be managed by its Board of Directors.
The Board of Directors shall have and may exercise all the rights, powers and
privileges of the Corporation except only for those that are by law, these
Articles of Incorporation or the Bylaws of the Corporation, conferred upon or
reserved to the stockholders. Additionally, the Board of Directors is hereby
specifically authorized and empowered from time to time in its discretion:
10.3.1 To borrow and raise money, without limit and
upon any terms, for any corporate purposes; and, subject to applicable law, to
authorize the creation, issuance, assumption or guaranty of bonds, debentures,
notes or other evidences of indebtedness for money so borrowed, to include
therein such provisions as to redeemability, convertibility or otherwise, as
the Board of Directors, in its sole discretion, determines, and to secure the
payment of principal, interest or sinking fund in respect thereof by mortgage
upon, or the pledge of, or the conveyance or assignment in trust of, all or any
part of the properties, assets and goodwill of the Corporation then owned or
thereafter acquired.
10.3.2 To make, alter, amend, change, add to or repeal
the Bylaws of the Corporation in accordance with the terms of the Bylaws
adopted by the Board of Directors pursuant to Section 2-109 of the Maryland
General Corporation Law; and
10.3.3 To the extent permitted by law, to declare
and pay dividends or other distributions to the stockholders from time to time
out of the earnings, earned surplus, paid-in surplus or capital of the
Corporation, notwithstanding that such declaration may result in the reduction
of the capital of the Corporation. In connection with any dividends or other
distributions upon the Stock, the Corporation need not reserve any amount from
such dividend or other distributions to satisfy any preferential rights of any
stockholder.
ARTICLE XI
INDEMNIFICATION
16
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The Corporation shall have the power to indemnify, by express
provision in its Bylaws, by agreement or by majority vote of either its
stockholders or disinterested Directors, any one or more of the following
classes of individuals: (1) present or former Directors of the Corporation,
(2) present or former officers of the Corporation, (3) present or former agents
and/or employees of the Corporation, (4) present or former administrators,
trustees or other fiduciaries under any pension, profit sharing, deferred
compensation or other employee benefit plan maintained by the Corporation and
(5) persons serving or who have served at the request of the Corporation in any
of these capacities for any other corporation, partnership, joint venture,
trust or other enterprise. However, the Corporation shall not have the power
to indemnify any person to the extent such indemnification would be contrary to
Section 2-418 of the Maryland General Corporation Law or any other applicable
statute, rule or regulation.
ARTICLE XII
LIMITATION OF LIABILITY
To the full extent permitted under the Maryland General
Corporation Law as in effect on the date of filing these Articles of
Incorporation or as the Maryland General Corporation Law is thereafter amended
from time to time, no Director or officer shall be liable to the Corporation
for money damages for any breach of any duty owed by such Director or officer
to the Corporation. Neither the amendment or repeal of this Article, nor the
adoption of any other provision in these Articles of Incorporation inconsistent
with this Article, shall eliminate or reduce the protection afforded by this
Article to a Director or officer of the Corporation with respect to any matter
which occurred, or any cause of action, suit or claim which but for this
Article would have accrued or arisen, prior to such amendment, repeal or
adoption.
ARTICLE XIII
SPECIAL VOTING REQUIREMENTS
Pursuant to Section 3-603(e)(1)(iii) of the Maryland General
Corporation Law, the Corporation expressly elects not to be governed by the
provisions of Section 3-602 of the Maryland General Corporation Law with
respect to any business combination (terms defined in Section 3-601 of the
Maryland General
17
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Corporation Law are used in this Article as therein defined) in which there is
no Interested Stockholder other than Mr. Shidler or any entity controlled by
Mr. Shidler unless Mr. Shidler is an Interested Stockholder without taking into
account Mr. Shidler's ownership of Common Stock and the right to acquire Common
Stock in an aggregate amount which does not exceed the number of shares of
Common Stock which Mr. Shidler owned and had the right to acquire (including,
without limitation, through the exchange of Units of First Industrial, L.P.) at
the time of effectiveness of the first effective Registration Statement for
Common Stock filed with the Securities and Exchange Commission under the
Securities Act of 1933).
THIRD: That the Board of Directors of the Corporation, by the
unanimous written consent of its members, duly adopted resolutions setting
forth proposed amendments to the Charter, declaring said amendments to be
advisable and directing that said amendments be submitted for consideration by
the stockholders.
FOURTH: That the stockholders of the Corporation, by
unanimous consent, approved said amendments.
18
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IN WITNESS WHEREOF, the Corporation has caused these Amended
and Restated Articles of Incorporation to be signed in its name and on its
behalf by its President and attested to by its Assistant Secretary on this 9th
day of June, 1994, and its said President acknowledges under the penalties of
perjury that these Amended and Restated Articles of Incorporation are the
corporate act of said Corporation and that, to the best of his knowledge,
information and belief, the matters and facts set forth herein are true in all
material respects.
FIRST INDUSTRIAL REALTY TRUST, INC.
By: /s/ Michael T. Tomasz
----------------------------------
Name: Michael T. Tomasz
Title: President and Chief
Executive Officer
Attest:
/s/ Michael W. Brennan
- ------------------------------
Name: Michael W. Brennan
Title: Assistant Secretary
1
EXHIBIT 3.2
ARTICLES OF AMENDMENT
OF
FIRST INDUSTRIAL REALTY TRUST, INC.
First Industrial Realty Trust, Inc., a Maryland corporation,
having its principal office in Baltimore, Maryland (the "Corporation), hereby
certifies to the State Department of Assessments and Taxation that it desires
to amend its Charter as currently in effect as follows:
FIRST: Section 9.12 of ARTICLE IX is hereby amended by
deleting such Section 9.12 of ARTICLE in its entirety and by inserting the
following Section 9.12 in lieu thereof:
"9.12 New York Stock Exchange. Nothing in this Article IX
shall preclude the settlement of any transaction entered into through
the facilities of the New York Stock Exchange."
SECOND: That the board of directors of the Corporation, by
the unanimous written consent of its members, duly adopted resolutions setting
forth proposed amendments to the Charter, declaring said amendments to be
advisable and directing that said amendments be submitted for consideration by
the stockholders.
THIRD: That the stockholders of the Corporation, by unanimous
consent, approved said amendments.
2
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IN WITNESS WHEREOF, the Corporation has caused these Articles
of Amendment to be signed in its name and on its behalf by its President and
attested to by its Secretary on this 20th day of June, 1994, and its said
President acknowledges under the penalties of perjury that these Articles of
Amendment are the corporate act of said Corporation and that, to the best of
his knowledge, information and belief, the matters and facts set forth herein
are true in all material respects.
First Industrial Realty Trust, Inc.
By: /s/ Michael T. Tomasz
-------------------------------
Name: Michael T. Tomasz
Title: President and CEO
Attest:
/s/ Michael W. Brennan
- --------------------------------
Name: Michael W. Brennan
Title: Assistant Secretary
1
Exhibit 3.3
ARTICLES OF AMENDMENT
OF
FIRST INDUSTRIAL REALTY TRUST, INC.
First Industrial Realty Trust, Inc., a Maryland corporation,
having its principal office in Baltimore, Maryland (the "Corporation"), hereby
certifies to the State Department of Assessments and Taxation that it desires
to amend its Charter as currently in effect as follows:
FIRST: Section 6.1 of ARTICLE VI is hereby amended by deleting
such Section 6.1 of ARTICLE VI in its entirety and by inserting the following
Section 6.1 in lieu thereof:
"6.1 Composition. The Corporation shall have a Board of Directors (a
majority of which shall be Independent Directors) consisting of nine (9)
Directors, which number may be increased in accordance with the Bylaws of
the Corporation, but shall not be less than the number required by Section
2-402 of the Maryland General Corporation Law nor more that twelve (12). For
purposes hereof, "Independent Director" shall mean a Director of the
Corporation who is neither employed by the Corporation nor a member (or an
affiliate or employee of a member) of The Shidler Group (as such term may be
defined in such above mentioned registration statement)."
SECOND: That the board of directors of the Corporation, by
unanimous vote at a duly called meeting, duly adopted resolutions setting forth
the proposed amendment to the Charter, declaring said amendment to be advisable
and directing that said amendment be submitted for consideration by the
stockholders.
THIRD: That the stockholders of the Corporation, by vote at a
duly called annual meeting, approved said amendment.
2
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IN WITNESS WHEREOF, the Corporation has caused these Articles
of Amendment to be signed in its name and on its behalf by its President and
its corporate seal to be hereunder affixed and attested to by its Secretary on
this 31st day of May, 1996, and its said President acknowledges under the
penalties of perjury that these Articles of Amendment are the corporate act of
said Corporation and that, to the best of his knowledge, information and
belief, the matters and facts set forth herein are true in all material
respects.
First Industrial Realty Trust, Inc.
By: /s/ Michael T. Tomasz
----------------------------
Name: Michael T. Tomasz
Title: President and Chief
Executive Officer
Attest:
/s/ Michael J. Havala
- ---------------------
Name: Michael J. Havala
Title: Secretary
1
EXHIBIT 3.4
9 1/2% Series A Cumulative Preferred Stock
(Liquidation Preference $25.00 Per Share)
ARTICLES SUPPLEMENTARY
FIRST INDUSTRIAL REALTY TRUST, INC.
Articles Supplementary of Board of Directors Classifying
and Designating a Series of Preferred Stock as
9 1/2% Series A Cumulative Preferred Stock
and Fixing Distribution and
Other Preferences and Rights of Such Series
____________________________
Dated as of November 14, 1995
2
EXHIBIT 3.4
FIRST INDUSTRIAL REALTY TRUST, INC.
__________
Articles Supplementary of Board of Directors Classifying
and Designating a Series of Preferred Stock as
9 1/2% Series A Cumulative Preferred Stock
and Fixing Distribution and
Other Preferences and Rights of Such Series
__________
First Industrial Realty Trust, Inc., a Maryland corporation,
having its principal office in the State of Maryland in the city of Baltimore
(the "Company"), hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
Pursuant to authority conferred upon the Board of Directors by
the Charter and Bylaws of the Company, the Board of Directors (i) on July 27,
1995 adopted resolutions authorizing the creation and issuance of up to
2,000,000 shares, at $25.00 per share, of Series A Cumulative Preferred Stock
which is to be redeemable after five years from the date of issuance and which
shall not pay dividends at a rate in excess of 9.5% and (ii) on September 20,
1995 adopted resolutions establishing a committee of the Board of Directors
with full power and authority, subject to the foregoing resolution, to
determine the preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends, qualifications, and terms and
conditions of redemption of the shares of such series. Such preferences,
conversion and other rights, voting powers, restrictions, limitations as to
dividends, qualifications, and terms and conditions of redemption, number of
shares and Dividend Rate (as defined herein), as determined by such duly
authorized committee are as follows:
Section 1. Number of Shares and Designation. This series of
Preferred Stock shall be designated as 9 1/2% Series A Cumulative Preferred
Stock (the "Series A Preferred Shares") and the number of shares which shall
constitute such series shall not be more than 1,650,000 shares, par value $.01
per share, which number may be decreased (but not below the number thereof then
outstanding) from time to time by the Board of Directors.
Section 2. Dividend Rights. (1) Dividends shall be payable
in cash on the Series A Preferred Shares when, as and if declared by the Board
of Directors, out of funds legally available therefor: (i) for the period (the
"Initial Dividend
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Period") from the Deemed Original Issue Date (as defined below) to but
excluding January 1, 1996, and (ii) for each quarterly dividend period
thereafter (the Initial Dividend Period and each quarterly dividend period
being hereinafter individually referred to as a "Dividend Period" and
collectively referred to as "Dividend Periods"), which quarterly Dividend
Periods shall commence on January 1, April 1, July 1, and October 1 in each
year (each, a "Dividend Period Commencement Date"), commencing on January 1,
1996, and shall end on and include the day next preceding the next Dividend
Period Commencement Date, at a rate per annum equal to 9 1/2% of the $25.00 per
share stated value thereof (the "Dividend Rate"). Dividends on each Series A
Preferred Share shall be cumulative from the Deemed Original Issue Date of such
share and shall be payable, without interest thereon, when, as and if declared
by the Board of Directors, on March 31, June 30, September 30 and December 31
of each year, commencing on December 31, 1996 or, in the case of Series A
Preferred Shares with a Deemed Original Issue Date after December 31, 1995, the
first such dividend payment date following such Deemed Original Issue Date;
provided, that if any such day shall be a Saturday, Sunday, or a day on which
banking institutions in the State of New York are authorized or obligated by
law to close, or a day which is or is declared a national or a New York state
holiday (any of the foregoing a "Non-Business Day"), then the payment date
shall be the next succeeding day which is not a Non-Business Day. Each such
dividend shall be paid to the holders of record of Series A Preferred Shares as
they appear on the stock register of the Company on such record date, not more
than 45 days nor less than 15 days preceding the payment date thereof, as shall
be fixed by the Board of Directors. Dividends on account of arrears for any
past Dividend Periods may be declared and paid at any time, without reference
to any regular dividend payment date, to holders of record on such date, not
more than 45 days nor less than 15 days preceding the payment date thereof, as
may be fixed by the Board of Directors. After an amount equal to full
cumulative dividends on this Series, including for the then current Dividend
Period, has been paid to holders of record of Series A Preferred Shares
entitled to receive dividends as set forth above by the Company or pursuant to
that certain Guarantee and Payment Agreement, to be dated November 17, 1995,
between First Industrial Securities, L.P. ("Securities, L.P.") and First
Industrial Securities Corporation for the benefit of American National Bank and
Trust Company of Chicago for the holders of the Series A Preferred Shares (the
"Guarantee") or such dividends declared and funds therefor set aside for
payment, the holders of Series A Preferred Shares will not be entitled to any
further dividends with respect to that Dividend Period.
4
-3-
"Deemed Original Issue Date" means (a) in the case of any
share which is part of the first issuance of Series A Preferred Shares or part
of a subsequent issuance of Series A Preferred Shares prior to January 1, 1996,
the date of such first issuance and (b) in the case of any share which is part
of a subsequent issuance of Series A Preferred Shares on or after January 1,
1996, the later of (x) January 1, 1996 and (y) the latest Dividend Period
Commencement Date which precedes the date of issuance of such share and which
succeeds the last Dividend Period for which full cumulative dividends have been
paid; provided that, in the case of any share which is part of a subsequent
issuance on or after January 1, 1996, the date of issuance of which falls
between (i) the record date for dividends payable on the first succeeding
dividend payment date and (ii) such dividend payment date, the "Deemed Original
Issue Date" means the date of the Dividend Period Commencement Date that
immediately follows the date of issuance.
(2) Dividends payable on Series A Preferred Shares for
any period greater or less than a full Dividend Period, including the Initial
Dividend Period, shall be computed on the basis of a 360-day year consisting of
twelve 30-day months. Dividends payable on Series A Preferred Shares for each
full Dividend shall be computed by dividing the Dividend Rate by four.
(3) When dividends (or, in the case of the Series A
Preferred Shares, the aggregate of dividends and payments under the Guarantee)
are not paid in full upon the Series A Preferred Shares and any other series of
preferred stock ranking on a parity therewith as to dividends, all dividends
declared upon the Series A Preferred Shares and any other series of preferred
stock ranking on a parity therewith as to dividends shall be declared pro rata
so that the amount of dividends declared per share on the Series A Preferred
Shares and such other series of preferred stock shall in all cases bear to each
other that same ratio that the accumulated dividends per share on the Series A
Preferred Shares and such other series of preferred stock bear to each other;
provided, however, that this sentence shall not limit rights to payment under
the Guarantee. Except as provided in the preceding sentence, unless an amount
equal to full cumulative dividends on the Series A Preferred Shares has been
paid to holders of record of Series A Preferred Shares entitled to receive
dividends as set forth above by the Company or pursuant to the Guarantee for
all past Dividend Periods, no dividends (other than in shares of the Company's
common stock, par value $.01 per share (together with any other shares of
capital stock of the Company into which such shares shall be reclassified or
changed ("Common Stock"), or another stock ranking junior to the
5
-4-
Series A Preferred Shares as to dividends and upon liquidation) shall be
declared or paid or set aside for payment nor shall any other distribution be
made upon the Common Stock or any other stock of the Company ranking junior to
or on a parity with the Series A Preferred Shares as to dividends or upon
liquidation. Unless an amount equal to full cumulative dividends on the Series
A Preferred Shares has been paid to holders of record of Series A Preferred
Shares entitled to receive dividends as set forth above by the Company or
pursuant to the Guarantee for all past Dividend Periods, no Common Stock or any
other stock of the Company ranking junior to or on a parity with the Series A
Preferred Shares as to dividends or upon liquidation shall be redeemed,
purchased, or otherwise acquired for any consideration (or any moneys be paid
to or made available for a sinking fund for the redemption of any shares of any
such stock) by the Company or any subsidiary, except by conversion into or
exchange for stock of the Company ranking junior to the Series A Preferred
Shares as to dividends and upon liquidation.
Section 3. Liquidation. (1) In the event of any voluntary
or involuntary liquidation, dissolution, or winding up of the Company, the
holders of Series A Preferred Shares are entitled to receive out of the assets
of the Company available for distribution to stockholders, before any
distribution of assets is made to holders of Common Stock or any other class or
series of shares ranking junior to the Series A Preferred Shares upon
liquidation, liquidating distributions in the amount of the stated value of $25
per share, plus all accumulated and unpaid dividends (whether or not earned or
declared) for the then current and all past Dividend Periods less cumulative
amounts paid under the Guarantee with respect to any such accumulated and
unpaid dividends. If, upon any voluntary or involuntary liquidation,
dissolution, or winding up of the Company the amounts payable with respect to
the Series A Preferred Shares and any other shares of the Company ranking as to
any such distribution on a parity with the Series A Preferred Shares are not
paid in full, the holders of Series A Preferred Shares and of such other shares
will share ratably in any such distribution of assets of the Company in
proportion to the full respective preferential amounts to which they are
entitled. After payment of the full amount of the liquidating distribution to
which they are entitled, the holders of Series A Preferred Shares will not be
entitled to any further participation in any distribution of assets by the
Company; provided, however, that this and the immediately preceding sentence
shall not limit rights to payment under the Guarantee.
6
-5-
(2) Written notice of any such liquidation, dissolution
or winding up of the Company, stating the payment date or dates when, and the
place or places where, the amounts distributable in such circumstances shall be
payable, shall be given by first class mail, postage pre-paid, not less than 30
nor more than 60 days prior to the payment date stated therein, to each record
holder of the Series A Preferred Shares at the respective addresses of such
holders as the same shall appear on the stock transfer records of the Company.
(3) For purposes of liquidation rights, a consolidation
or merger of the Company with or into any other corporation or corporations or
a sale of all or substantially all of the assets of the Company shall be deemed
not to be a liquidation, dissolution or winding up of the Company
Section 4. Redemption. (1) Except as provided in clause (9)
below, the Series A Preferred Shares are not redeemable prior to November 17,
2000. On and after such date, the Series A Preferred Shares are redeemable at
the option of the Company, by resolution of the Board of Directors, in whole or
in part, from time to time upon not less than 30 nor more than 60 days' notice,
at a cash redemption price of the stated value of $25 per share, plus all
accumulated and unpaid dividends (whether or not earned or declared) to the
date of redemption, less cumulative amounts paid under the Guarantee with
respect to any such accumulated and unpaid dividends.
(2) If fewer than all of the outstanding Series A
Preferred Shares are to be redeemed, the number of shares to be redeemed will
be determined by the Board of Directors and such shares shall be redeemed pro
rata from the holders of record of such shares in proportion to the number of
such shares held by such holders (with adjustments to avoid redemption of
fractional shares) or by lot in a manner determined by the Board of Directors.
(3) Notwithstanding the foregoing, if an amount equal to
full dividends for all past Dividend Periods on the Series A Preferred Shares
has not been paid to holders of record of Series A Preferred Shares entitled to
receive dividends as set forth above by the Company or pursuant to the
Guarantee, no Series A Preferred Shares shall be redeemed, except pursuant to
Article IX of the Charter, unless all outstanding Series A Preferred Shares are
simultaneously redeemed, and the Company shall not purchase or otherwise
acquire, directly or indirectly, any Series A Preferred Shares; provided,
however, that the foregoing shall not prevent the purchase or acquisition of
Series A Preferred
7
-6-
Shares pursuant to a purchase or exchange offer provided such offer is made on
the same terms to all holders of Series A Preferred Shares.
(4) Immediately prior to any redemption of Series A
Preferred Shares, the Company shall pay, in cash, any accumulated and unpaid
dividends through the redemption date, unless a redemption date falls after a
dividend payment record date and prior to the corresponding dividend payment
date, in which case each holder of Series A Preferred Shares at the close of
business on such dividend payment record date shall be entitled to the dividend
payable on such shares on the corresponding dividend payment date
notwithstanding the redemption of such shares before such dividend payment
date. Except as expressly provided hereinabove, the Company shall make no
payment or allowance for unpaid dividends, whether or not in arrears, on Series
A Preferred Shares called for redemption.
(5) Notice of redemption shall be given by publication in
a newspaper of general circulation in The City of New York, such publication to
be made once a week for two successive weeks, commencing not less than 30 nor
more than 60 days prior to the date fixed for redemption thereof. A similar
notice will be mailed by the Company by first class mail, postage pre-paid, to
each record holder of the Series A Preferred Shares to be redeemed, not less
than 30 nor more than 60 days prior to such redemption date, to the respective
addresses of such holders as the same shall appear on the stock transfer
records of the Company. Each notice shall state: (i) the redemption date;
(ii) the number of Series A Preferred Shares to be redeemed; (iii) the
redemption price; (iv) the place or places where certificates for such shares
are to be surrendered for payment of the redemption price; and (v) that
dividends on the shares to be redeemed will cease to accumulate on such
redemption date. If fewer than all the Series A Preferred Shares held by any
holder are to be redeemed, the notice mailed to such holder shall also specify
the number of Series A Preferred Shares to be redeemed from such holder.
(6) In order to facilitate the redemption of Series A
Preferred Shares, the Board of Directors may fix a record date for the
determination of the shares to be redeemed, such record date to be not less
than 30 nor more than 60 days prior to the date fixed for such redemption.
(7) Notice having been given as provided above, from and
after the date fixed for the redemption of Series A Preferred Shares by the
Company (unless the Company shall fail to make
8
-7-
available the money necessary to effect such redemption and such money which
the Company fails to make available is not made available pursuant to the
Guarantee), the holders of shares selected for redemption shall cease to be
stockholders with respect to such shares and shall have no interest in or claim
against the Company by virtue thereof and shall have no voting or other rights
with respect to such shares, except the right to receive the moneys payable
upon such redemption from the Company, less any required tax withholding
amount, without interest thereon, upon surrender (and endorsement or assignment
of transfer, if required by the Company and so stated in the notice) of their
certificates, and the shares represented thereby shall no longer be deemed to
be outstanding. If fewer than all the shares represented by a certificate are
redeemed, a new certificate shall be issued, without cost to the holder
thereof, representing the unredeemed shares. The Company may, at its option,
at any time after a notice of redemption has been given, deposit the redemption
price for the Series A Preferred Shares designated for redemption and not yet
redeemed, plus any accumulated and unpaid dividends thereon to the date fixed
for redemption, with the transfer agent or agents for the Series A Preferred
Shares, as a trust fund for the benefit of the holders of the Series A
Preferred Shares designated for redemption, together with irrevocable
instructions and authority to such transfer agent or agents that such funds be
delivered upon redemption of such shares and to pay, on and after the date
fixed for redemption or prior thereto, the redemption price of the shares to
their respective holders upon the surrender of their share certificates. From
and after the making of such deposit, the holders of the shares designated for
redemption shall cease to be stockholders with respect to such shares and shall
have no interest in or claim against the Company by virtue thereof and shall
have no voting or other rights with respect to such shares, except the right to
receive from such trust fund the moneys payable upon such redemption, without
interest thereon, upon surrender (and endorsement, if required by the Company)
of their certificates, and the shares represented thereby shall no longer be
deemed to be outstanding. Any balance of such moneys remaining unclaimed at
the end of the five-year period commencing on the date fixed for redemption
shall be repaid to the Company upon its request expressed in a resolution of
its Board of Directors.
(8) Any Series A Preferred Shares that shall at any time
have been redeemed shall, after such redemption, have the status of authorized
but unissued preferred stock, without designation as to series until such
shares are once more
9
-8-
designated as part of a particular series by the Board of Directors.
(9) The Series A Preferred Shares are subject to the
provisions of Article IX of the Charter, including, without limitation, the
provision for the redemption of Excess Stock (as defined in such Article).
Notwithstanding the provisions of Article IX of the Charter, Series A Preferred
Shares which have been exchanged pursuant to such Article for Excess Stock may
be redeemed, in whole or in part, and, if in part, pro rata from the holders of
record of such shares in proportion to the number of such shares held by such
holders (with adjustments to avoid redemption of fractional shares) or by lot
in a manner determined by the Board of Directors, at any time when outstanding
Series A Preferred Shares are being redeemed.
Section 5. Voting Rights. The Series A Preferred Shares
shall not have any voting powers either general or special, except as required
by law and except that:
(1) If and whenever full cumulative dividends on the
Series A Preferred Shares, or any other series of preferred stock of the
Company ranking on a parity with the Series A Preferred Shares as to dividends
or upon liquidation (any such series, a "Parity Preferred Series"), for six
quarterly dividend payment periods, whether or not consecutive, are in arrears
and unpaid, and no payments curing all such arrearages in such dividends for
any of such six quarterly dividend payment periods have been made pursuant to
the Guarantee (such failure to pay by the Company, and pursuant to the
Guarantee, a "Dividend Default"), the holders of all outstanding Series A
Preferred Shares and any Parity Preferred Series, voting as a single class
without regard to series, will be entitled to elect two Directors until all
dividends in arrears and unpaid on the Series A Preferred Shares and any Parity
Preferred Series have been paid or declared and funds therefor set apart for
payment. At any time when such right to elect Directors separately as a class
shall have so vested, the Company may, and upon the written request of the
holders of record of not less than 20% of the total number of Series A
Preferred Shares and shares of any Parity Preferred Series of the Company then
outstanding shall, call a special meeting of stockholders for the election of
such Directors. In the case of such a written request, such special meeting
shall be held within 90 days after the delivery of such request and, in either
case, at the place and upon the notice provided by law and in the Bylaws of the
Company, provided that the Company shall not be required to call such a special
meeting if such request is received less than 120 days before the date fixed
for the next
10
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ensuing Annual Meeting of Stockholders of the Company and the holders of all
outstanding Series A Preferred Shares and shares of any Parity Preferred Series
are afforded the opportunity to elect such Directors (or fill any vacancy) at
such Annual Meeting of Stockholders. Directors elected as aforesaid shall
serve until the next Annual Meeting of Stockholders of the Company or until
their respective successors shall be elected and qualified, or, if sooner,
until an amount equal to all dividends in arrears and unpaid has been paid or
declared and set apart for payment or, in the case of the Series A Preferred
Shares, payments have been made under the Guarantee in the amount of such
dividends in arrears and unpaid or declared and set aside by the Company. If,
prior to the end of the term of any Director elected as aforesaid, a vacancy in
the office of such Director shall occur during the continuance of a Dividend
Default by reason of death, resignation, or disability, such vacancy shall be
filled for the unexpired term by the appointment of a new Director for the
unexpired term of such former Director, such appointment to be made by the
remaining Director elected as aforesaid.
(2) The affirmative vote or consent of the holders of at
least two-thirds of the outstanding Series A Preferred Shares and any Parity
Preferred Series, voting as a single class without regard to series, will be
required to issue, authorize or increase the authorized amount of any class or
series of shares ranking prior to the Series A Preferred Shares as to dividends
or upon liquidation or to issue or authorize any obligation or security
convertible into or evidencing a right to purchase any such security. The
affirmative vote or consent of the holders of at least two-thirds of the
outstanding Series A Preferred Shares, voting separately as a class, will be
required to amend or repeal any provision of, or add any provision to, the
Charter if such action would materially and adversely alter or change the
powers, preferences, privileges or rights of the Series A Preferred Shares.
(3) Nothing herein shall be taken to require a class vote
or consent in connection with the authorization, designation, increase or
issuance of any shares of any class or series (including additional preferred
stock of any series) that rank junior to or on a parity with the Series A
Preferred Shares as to dividends and liquidation rights or in connection with
the authorization, designation, increase or issuance of any bonds, mortgages,
debentures or other debt obligations of the Company.
Section 6. Conversion. The Series A Preferred Shares are not
convertible into shares of any other class or series of the capital stock of
the Company.
11
-10-
IN WITNESS WHEREOF, the Company has caused these Articles
Supplementary to be signed in its name and on its behalf by its President and
attested to by its Secretary on this 14th day of November, 1995 and its said
President acknowledges under the penalties of perjury that these Articles
Supplementary are the corporate act of said Company and that to the best of his
knowledge, information and belief, the matters and facts set forth herein are
true in all material respects.
FIRST INDUSTRIAL REALTY TRUST, INC.
By: /s/ Michael T. Tomasz
----------------------------
Name: Michael T. Tomasz
Title: President and Chief
Executive Officer
Attest:
/s/ Michael J. Havala
- -----------------------------
Name: Michael J. Havala
Title: Secretary
1
Exhibit 10.1
FIRST AMENDMENT
TO
SECOND AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
OF
FIRST INDUSTRIAL, L.P.
The undersigned, being the sole general partner of First Industrial,
L.P. (the "Partnership"), a limited partnership formed under the Delaware
Revised Uniform Limited Partnership Act and pursuant to the terms of that
certain Second Amended and Restated Limited Partnership Agreement dated June
30, 1994 (the "Partnership Agreement") by and among First Industrial Realty
Trust, Inc., as General Partner, and the Persons listed on Exhibit 1 thereto as
Limited Partners, together with any Persons who become Partners in the
Partnership in accordance with the terms thereof, does hereby amend the
Partnership Agreement as follows:
Capitalized terms used but not defined in this First Amendment shall
have the same meanings that are ascribed to them in the Partnership Agreement.
1. Amendment. Subsection (A) of Section 6.4 of the Partnership
Agreement is hereby amended by inserting in the last sentence thereof after the
word "except" the numerical symbol "(i)" and by adding to the end of such
sentence the following text:
"or (ii) where the General Partner determines, in its sole judgment,
that such sale, transfer or conveyance confers benefits on the General
Partner or the Partnership in respect of matters of tax or corporate or
financial structure; provided, in the case of this clause (ii), such sale,
transfer or conveyance is not being effected for the purpose of materially
disadvantaging the Limited Partners."
2. Effectiveness. This First Amendment shall be effective as of
December 21, 1994.
3. Ratification. Except as expressly modified by this First Amendment,
all of the provisions of the Partnership Agreement are affirmed and ratified
and remain in full force and effect.
Date: November 17, 1995
First Industrial Realty Trust, Inc.
as sole General Partner
of the Partnership
By: /s/ Michael T. Tomasz
-------------------------------
Michael T. Tomasz
President and Chief
Executive Officer
1
EXHIBIT 10.2
SECOND AMENDMENT TO
SECOND AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT OF
FIRST INDUSTRIAL, L.P.
The undersigned, being the sole general partner of First Industrial,
L.P. (the "Partnership"), a limited partnership formed under the Delaware
Revised Uniform Limited Partnership Act and pursuant to the terms of that
certain Second Amended and Restated Limited Partnership Agreement dated June 30,
1994 (as amended by that certain First Amendment thereto dated November 17,
1995, the "Partnership Agreement") by and among First Industrial Realty Trust,
Inc., as General Partner, and the Persons listed on Exhibit 1 thereto as
Limited Partners, together with any Persons who become Partners in the
Partnership in accordance with the terms thereof, does hereby amend the
Partnership Agreement as follows:
Capitalized terms used but not defined in this Second Amendment shall
have the same meanings that are ascribed to them in the Partnership Agreement.
1. Legend. The cover page of the Partnership Agreement is hereby
amended by adding to the bottom of such page the following legend:
"THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND
RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, AND THE APPLICABLE STATE
SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM."
2. Additional Limited Partners. The Persons identified on Schedule 1
hereto are hereby admitted to the Partnership as Additional Limited Partners
owning the number of Units and having made the Capital Contributions set forth
on such Schedule 1. Such persons hereby adopt the Partnership Agreement. The
General Partner hereby consents to the assignment of all Units of the
Additional Limited Partners identified as transferors on Schedule 2 hereto to
their equity owners identified as transferees and in the amounts set forth on
such Schedule 2, and to the admission to the Partnership as Substituted Limited
Partners of such transferees, and such transferees are hereby admitted to the
Partnership as Substituted Limited Partners, all effective as of March 20,
1996.
3. Schedule of Partners. A new Exhibit 1A in the form of Exhibit 1A
hereto is hereby added to the Partnership Agreement. A new Exhibit 1B in the
form of Exhibit 1B hereto is hereby added to the Partnership Agreement to
identify the Partners following consummation of the transactions referred to in
Section 2 hereof.
2
4. Definitions. The following definitions are hereby added in
appropriate alphabetic order placement to Section 1.1 of the Partnership
Agreement:
"First Highland Limited Partners: Those Limited Partners
identified on Exhibit 1A hereto.
First Highland Properties: Those certain properties acquired by
the Partnership pursuant to that certain Contribution Agreement, dated
as of March 19, 1996.
First Highland Units: The Partnership Units issued to the First
Highland Limited Partners in connection with the acquisition of the
First Highland Properties by the Partnership."
5. Amendment of Section 9.5. Section 9.5 is hereby amended by
adding the following new sentence after the first sentence thereof:
"Notwithstanding anything herein to the contrary, each holder of
First Highland Units agrees that, if the General Partner shall elect to
satisfy a Redemption Obligation with respect to First Highland Units by
making a Share Payment, such Redemption Obligation shall mature on the
date which is seven (7) business days after receipt by the Partnership
and the General Partner of documents similar to the "Investor Materials"
submitted in connection with the sale of the First Highland Properties
to the Partnership and any other similar documents reasonably required
by, and in form reasonably satisfactory to, the Partnership."
6. Amendment to Section 9.7. Section 9.7 is hereby amended by
inserting after the words "in connection with a redemption" the words "of
Partnership Units originally issued to Initial Limited Partners on June 30,
1994".
7. Effectiveness. This Second Amendment shall be effective as of
March 20, 1996.
8. Ratification. Except as expressly modified by this First
Amendment, all of the provisions of the Partnership Agreement are affirmed and
ratified and remain in full force and effect.
-2-
3
Date: March 20, 1996
FIRST INDUSTRIAL REALTY TRUST, INC.,
as sole General Partner of the Partnership
By: MICHAEL W. BRENNAN
-----------------------------------------
Michael W. Brennan
Senior Vice President and Chief Operating
Officer
- 5 -
4
EXHIBIT 1A
First Highland Partners Number of Units
- ----------------------- ---------------
Farlow Road Associates Limited Partnership 2,751
Highland Associates Limited Partnership 69,039
Peter Murphy 56,184
North Star Associates Limited Partnership 19,333
Arden O'Connor 63,845
Peter O'Connor 118,281
Partridge Road Associates Limited Partnership 2,751
Shadeland Associates Limited Partnership 42,976
Shadeland Corporation 4,442
Kevin Smith 13,571
Jonathan Stott 182,126
1A-1
5
EXHIBIT 1B
Schedule of Partners
--------------------
General Partner Number of Units
- --------------- ---------------
First Industrial Realty Trust, Inc. 24,125,216
Limited Partners
- ----------------
Daniel R. Andrew, TR of the Daniel R.
Andrew Trust UA Dec 29 92 137,489
Robert W. Bennett 36,476
John E. De B Blockey 4,416
John E. de B Blockey, TR of the John E.
De B Blockey Trust 3,771
Michael W. Brennan 7,587
Henry D. Bullock 14,151
Edward Burger 9,261
Jo Ann Chitty 1,104
Michael G Damone, TR of the Michael G.
Damone Trust UA Nov 4 69 144,296
Robert L. Denton 6,286
Henry E. Dietz Trust UA Jan 16 81 36,476
W. Allen Doane 4,416
Timothy Donohue 2,000
Thelma C. Gretzinger Trust 450
Clay Hamlin & Lynn Hamlin JT TEN WROS 15,159
Robert W. Holman Jr. 150,134
1B-1
6
LIMITED PARTNERS NUMBER OF UNITS
- ---------------- ---------------
Steven B. Hoyt 250,000
Frederick K. Ito 3,880
Michael W. Jenkins 8,831
Peter Kepic 9,261
Paul T. Lambert 39,737
Lambert Investment Corporation 13,606
Duane Lund 13,617
J. Stanley Mattison 981
Marc T. Melardino 1,104
Eileen Millar 2,880
Linda Miller 2,000
Anthony Muscatello 81,654
Shidler Equities LP 254,541
Eduardo Paneque 2,000
Bernice Reger 22,556
James R. Reinhart 4,416
James C. Reynolds 38,697
Jay H. Shidler 64,137
Jay H. Shidler & Wallette A. Shidler
TEN ENT 1,223
Michael B. Slade 2,829
Timothy P. Talbot 6,041
1B-2
7
Limited Partners Number of Units
- ---------------- ---------------
Michael T. Tomasz 23,868
Mark S. Whiting 25,206
Holman/Shidler Investment Corporation 22,079
Farlow Road Associates Limited Partnership 2,751
Highland Associates Limited Partnership 69,039
Peter Murphy 56,184
North Star Associates Limited Partnership 19,333
Arden O'Connor 63,845
Peter O'Connor 118,281
Partridge Road Associates Limited Partnership 2,751
Shadeland Associates Limited Partnership 42,976
Shadeland Corporation 4,442
Kevin Smith 13,571
Jonathan Stott 182,126
1B-3
8
Schedule 1
Additional Limited Partners Number of Units Capital Contribution
- --------------------------- --------------- --------------------
2900 North Shadeland Associates
Limited Partnership 6,013 $ 126,273
Americana Parkway Associates
Limited Partnership 43,073 904,533
Creek Road Business Park Limited
Partnership 118,961 2,498,181
Fifth Brookville Associates
Limited Partnership 12,172 255,612
Fourth Brookville Associates
Limited Partnership 40,337 847,077
Highland Associates Limited
Partnership 69,039 1,449,819
Lincoln Center Associates Limited
Partnership 161,634 3,394,314
North Star Associates Limited
Partnership 19,333 405,993
Shadeland Associates Limited
Partnership 42,976 902,496
Third Brookville Associates
Limited Partnership 15,751 330,771
9
Schedule 2
Transferors Transferees Number of Units
- ----------- ----------- ---------------
2900 North Shadeland Shadeland Corporation 60
Associates Limited Partnership
2900 North Shadeland Peter Murphy 451
Associates Limited Partnership
2900 North Shadeland Farlow Road Associates 2,751
Associates Limited Partnership Limited Partnership
2900 North Shadeland Partridge Road Associates 2,751
Associates Limited Partnership Limited Partnership
Americana Parkway Associates Shadeland Corporation 431
Limited Partnership
Americana Parkway Associates Peter O'Connor 21,321
Limited Partnership
Americana Parkway Associates Jonathan Stott 21,321
Limited Partnership
Creek Road Business Park Shadeland Corporation 1,190
Limited Partnership
Creek Road Business Park Peter O'Connor 52,100
Limited Partnership
Creek Road Business Park Jonathan Stott 52,100
Limited Partnership
Creek Road Business Park Kevin Smith 13,571
Limited Partnership
Fifth Brookville Associates Shadeland Corporation 80
Limited Partnership
Fifth Brookville Associates Peter O'Connor 4,017
Limited Partnership
Fifth Brookville Associates Jonathan Stott 4,017
Limited Partnership
Fifth Brookville Associates Peter Murphy 4,017
Limited Partnership
Fourth Brookville Associates Shadeland Corporation 404
Limited Partnership
Fourth Brookville Associates Peter O'Connor 18,454
Limited Partnership
10
Transferors Transferees Number of Units
- ----------- ----------- ---------------
Fourth Brookville Associates Jonathan Stott 18,454
Limited Partnership
Fourth Brookville Associates Peter Murphy 3,025
Limited Partnership
Lincoln Center Associates Shadeland Corporation 1,617
Limited Partnership
Lincoln Center Associates Arden O'Connor 63,845
Limited Partnership
Lincoln Center Associates Jonathan Stott 63,845
Limited Partnership
Lincoln Center Associates Peter Murphy 32,327
Limited Partnership
Shadeland Center One Shadeland Corporation 461
Associates Limited Partnership
Shadeland Center One Peter O'Connor 15,183
Associates Limited Partnership
Shadeland Center One Jonathan Stott 15,183
Associates Limited Partnership
Shadeland Center One Peter Murphy 15,183
Associates Limited Partnership
Third Brookville Associates Shadeland Corporation 158
Limited Partnership
Third Brookville Associates Peter O'Connor 7,206
Limited Partnership
Third Brookville Associates Jonathan Stott 7,206
Limited Partnership
Third Brookville Associates Peter Murphy 1,181
Limited Partnership
1
EXHIBIT 10.3
THIRD AMENDMENT TO
SECOND AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT OF
FIRST INDUSTRIAL, L.P.
The undersigned, being the sole general partner of First Industrial,
L.P. (the "Partnership"), a limited partnership formed under the Delaware
Revised Uniform Limited Partnership Act and pursuant to the terms of that
certain Second Amended and Restated Limited Partnership Agreement dated June
30, 1994 (as amended by amendments thereto dated November 17, 1995 and March
20, 1996, the "Partnership Agreement"), does hereby amend the Partnership
Agreement as follows:
Capitalized terms used but not defined in this Third Amendment shall
have the same meanings that are ascribed to them in the Partnership Agreement.
1. Additional Limited Partners. The Persons identified on Schedule 1
hereto are hereby admitted to the Partnership as Additional Limited Partners
owning the number of Units and having made the Capital Contributions set forth
on such Schedule 1. Such persons hereby adopt the Partnership Agreement. The
General Partner hereby consents to the assignment of all Units of the
Additional Limited Partners identified as transferors on Schedule 2 hereto to
their equity owners identified as transferees and in the amounts set forth on
such Schedule 2, and to the admission to the Partnership as Substituted Limited
Partners of such transferees, and such transferees are hereby admitted to the
Partnership as Substituted Limited Partners, all effective as of June 28, 1996.
2. Schedule of Partners. Exhibit 1B to the Partnership is hereby
deleted in its entirety and replaced by Exhibit 1B hereto which identifies the
Partners following consummation of the transactions referred to in Section 1
hereof.
3. Amendment of Section 5.3(B). Section 5.3(B) is hereby amended by
adding the following at the end thereof:
"except that the first distribution paid on Units issued after
June 1, 1996 shall be pro rated to reflect the actual portion of the
period for which the distribution is being paid during which such
Units were outstanding, or shall be in such other amount or computed
on such other basis as may be agreed by the General Partner and the
holders of such Units, provided that such other amount or the amount
so computed, as applicable, may not exceed the aforementioned pro
rated amount."
4. Effectiveness. This Third Amendment shall be effective as of June
28, 1996.
2
5. Ratification. Except as expressly modified by this Third Amendment,
all of the provisions of the Partnership Agreement are affirmed and ratified
and remain in full force and effect.
Dated: June 28, 1996
FIRST INDUSTRIAL REALTY TRUST, INC.,
as sole General Partner of the Partnership
By: /s/ Johannson L. Yap
----------------------------------
Johannson L. Yap,
Senior Vice President/Acquisitions
-2-
3
EXHIBIT 1B
SCHEDULE OF PARTNERS
GENERAL PARTNER NUMBER OF UNITS
- --------------- ---------------
First Industrial Realty Trust, Inc. 24,137,881
LIMITED PARTNERS
- ----------------
Daniel R. Andrew, TR of the Daniel R.
Andrew Trust UA Dec 29 92 137,489
Robert W. Bennett 36,476
John E. de B Blockey, TR of the John E.
De B Blockey Trust 8,187
Michael W. Brennan 7,587
Henry D. Bullock 14,151
Edward Burger 9,261
Michael G Damone, TR of the Michael G.
Damone Trust UA Nov 4 69 144,296
Robert L. Denton 6,286
Henry E. Dietz Trust UA Jan 16 81 36,476
W. Allen Doane TR of the W. Allen
Doane Trust UA May 31, 91 4,416
Timothy Donohue 2,000
Farlow Road Associates Limited Partnership 2,751
Thelma C. Gretzinger Trust 450
Clay Hamlin & Lynn Hamlin JT TEN WROS 15,159
Highland Associates Limited Partnership 69,039
- 1 -
4
LIMITED PARTNERS NUMBER OF UNITS
- ---------------- ---------------
Robert W. Holman Jr. 150,134
Steven B. Hoyt 250,000
Frederick K. Ito 3,880
Michael W. Jenkins 8,831
Peter Kepic 9,261
Paul T. Lambert 39,737
Lambert Investment Corporation 13,606
LGR Investment Fund Ltd 22,556
Duane Lund 13,617
Eileen Millar 2,880
Linda Miller 2,000
Peter Murphy 56,184
Anthony Muscatello 81,654
North Star Associates Limited Partnership 19,333
Arden O'Connor 63,845
Peter O'Connor 118,281
Shidler Equities LP 254,541
Eduardo Paneque 2,000
Partridge Road Associates Limited Partnership 2,751
James C. Reynolds 38,697
Shadeland Associates Limited Partnership 42,976
- 2 -
5
Limited Partners Number of Units
- --------------- ---------------
Shadeland Corporation 4,442
Jay H. Shidler 65,118
Jay H. Shidler & Wallette A. Shidler
TEN ENT 1,223
Michael B. Slade 2,829
Kevin Smith 13,571
Robert Stein 42,250
S. Larry Stein 42,250
Jonathan Stott 182,126
Michael T. Tomasz 23,868
Mark S. Whiting 25,206
Holman/Shidler Investment Corporation 22,079
- 3 -
6
SCHEDULE 1
Additional Limited Partners Number of Units Capital Contribution
- --------------------------- --------------- --------------------
Trotwood Industrial Park 84,500 $2,004,129
7
SCHEDULE 2
Transferor Transferee Number of Units
- ---------- ---------- ---------------
Trotwood Industrial Park Robert Stein 42,250
Trotwood Industrial Park S. Larry Stein 42,250
5
1,000
U.S DOLLARS
6-MOS
DEC-31-1996
JAN-01-1996
JUN-30-1996
1
5,538
0
4,910
(500)
0
9,948
906,012
(78,893)
884,300
28,617
0
0
17
241
404,458
884,300
65,424
69,744
0
0
35,883
0
13,997
19,864
0
19,864
0
821
0
19,043
.68
.68
