SECURITIES AND EXCHANGE COMMISSION
UNITED STATES
Washington, DC 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) August 1, 1996
REGENCY REALTY CORPORATION
(Exact name of registrant as specified in its charter)
Florida 1-12298 59-3191743
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
121 West Forsyth Street, Suite 200
Jacksonville, Florida 32202
(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code: (904)-356-7000
Not Applicable
(Former name or former address, if changed since last report)
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
A. Financial Statements and Pro Forma Financial Information
A) Financial Statements:
City View Shopping Center
Independent Auditors' Report
Statement of Revenues and Certain Expenses
for the year ended December 31, 1995
Union Square Shopping Center
Independent Auditors' Report
Statement of Revenues and Certain Expenses
for the year ended December 31, 1995
Palm Harbour Shopping Village
Independent Auditors' Report
Statement of Revenues and Certain Expenses
for the year ended December 31, 1995
Welleby Plaza
Audited Financial Statements are
unavailable. The acquisition purchase price
of $7,251,000 represents 2.29% of total pro
forma assets.
B) Pro Forma Financial Information:
Regency Realty Corporation
Pro Forma Condensed Consolidated Balance Sheet,
June 30, 1996 (unaudited)
Pro Forma Condensed Statements of Operations
for the Six Month Period ended June 30, 1996
and the year ended December 31, 1995 (unaudited)
C) Exhibits
10. Material Contracts
*(a) Purchase and Sale Agreement dated April 16, 1996, between RRC
Acquisitions, Inc., a wholly-owned subsidiary of the Company as
purchaser, and Connecticut General Life Insurance Company, on
Behalf of its Separate Account R as seller, relating to the
acquisition of Welleby Plaza.
*(b) Purchase and Sale Agreement dated June 19, 1996, between RRC
Acquisitions, Inc., a wholly-owned subsidiary of the Company as
buyer, and Norcom Development, Inc. as seller, relating to the
acquisition of City View Shopping Center and Union Square
Shopping Center.
*(c) Purchase and Sale Agreement dated March 29, 1996, between RRC
Acquisitions, Inc., a wholly-owned subsidiary of the Company as
buyer, and Palm Harbour Centers Associates as seller, relating
to the acquisition of Palm Harbour Shopping Village.
- ------------------------
* Filed August 9, 1996
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
REGENCY REALTY CORPORATION
(registrant)
September 19, 1996 By: /s/ J. Christian Leavitt
---------------------------------------
J. Christian Leavitt
Vice President and Treasurer
Independent Auditors' Report
The Board of Directors
Regency Realty Corporation:
We have audited the accompanying statement of revenues and certain expenses
(defined as being gross income less operating costs and expenses, exclusive of
expenses not directly related to the operation of the property) of City View
Shopping Center for the year ended December 31, 1995. This financial statement
is the responsibility of management. Our responsibility is to express an opinion
on this statement of revenues and certain expenses based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the statement of revenues and certain expenses is free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the statement of revenues and certain
expenses. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
presentation of the statement of revenues and certain expenses. We believe that
our audit provides a reasonable basis for our opinion.
The accompanying statement of revenues and certain expenses of City View
Shopping Center was prepared for the purposes of complying with the rules and
regulations of the Securities and Exchange Commission for inclusion in the Form
8-K of Regency Realty Corporation and excludes material amounts, described in
note 1 to the statement of revenues and certain expenses, that would not be
comparable to those resulting from the proposed future operations of the
property.
In our opinion, the statement of revenues and certain expenses referred to above
presents fairly, in all material respects, the revenue and certain expenses (as
defined above) of City View Shopping Center for the year ended December 31,
1995, in conformity with generally accepted accounting principles.
/s/ KPMG Peat Marwick LLP
================================
KPMG Peat Marwick LLP
Certified Public Accountants
Jacksonville, Florida
August 9, 1996
CITY VIEW SHOPPING CENTER
Statement of Revenues and Certain Expenses
Year ended December 31, 1995
Real estate operation revenues:
Minimum rent $ 624,512
Recoveries from tenants 103,550
---------
728,062
---------
Real estate operation expenses:
Operating and maintenance 59,729
Management fees 38,282
Real estate taxes 42,218
General and administrative 11,918
---------
152,147
---------
Revenues in excess of certain expenses $ 575,915
=========
See accompanying notes to statement of revenues and certain expenses.
CITY VIEW SHOPPING CENTER
Notes to Statement of Revenues and Certain Expenses
Year ended December 31, 1995
1. Basis of Presentation
The statement of revenues and certain expenses relates to the operation of
a 77,550 square foot shopping center (the "Property") located in Charlotte,
North Carolina.
The Property's records are maintained on the accrual basis which is used
for Federal income tax reporting purposes. Adjustments, if necessary, have
been made to present the accompanying financial statement on the accrual
basis of accounting in conformity with generally accepted accounting
principles.
Subsequent to December 31, 1995, the Property was acquired by Regency
Realty Corporation (RRC) in a transaction accounted for as a purchase. All
operations of the Property will be included in the consolidated financial
statements of RRC beginning at the acquisition date.
The accompanying financial statement is not representative of the actual
operation for the period presented as certain expenses, which may not be
comparable to the expenses expected to be incurred by RRC in the proposed
future operation of the Property, have been excluded. RRC is not aware of
any material factors relating to the Property that would cause the reported
financial information not to be necessarily indicative of future operating
results. Costs not directly related to the operation of the Property have
been excluded and consist of interest, depreciation, professional fees, and
various other non operating expenses.
2. Operating Leases
During 1995, three tenants paid minimum rent that exceeded 10% of the total
minimum rent earned by the Property. The tenants, and the minimum rent
paid, are as follows:
Winn Dixie Supermarkets $ 281,600
Public Library 80,000
Youthland Academy 85,260
========
CITY VIEW SHOPPING CENTER
Notes to Statement of Revenue and Certain Expenses
Year ended December 31, 1995
2. Operating Leases, continued
The Property is leased to tenants under operating leases with expiration
dates extending to the year 2013. Future minimum rent under noncancelable
operating leases excluding tenant reimbursements of operating expenses and
excluding additional contingent rentals based on tenants' sales volume, as
of December 31, 1995 are as follows:
Year ending December 31, Amount
1996 $ 654,425
1997 656,388
1998 671,129
1999 691,321
2000 668,200
=========
Independent Auditors' Report
The Board of Directors
Regency Realty Corporation:
We have audited the accompanying statement of revenues and certain expenses
(defined as being gross income less operating costs and expenses, exclusive
of expenses not directly related to the operation of the property) of Union
Square Shopping Center for the year ended December 31, 1995. This financial
statement is the responsibility of management. Our responsibility is to
express an opinion on this statement of revenues and certain expenses based
on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the statement of revenues and
certain expenses is free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the statement of revenues and certain expenses. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall presentation of the statement
of revenues and certain expenses. We believe that our audit provides a
reasonable basis for our opinion.
The accompanying statement of revenues and certain expenses of Union Square
Shopping Center was prepared for the purposes of complying with the rules and
regulations of the Securities and Exchange Commission for inclusion in the
Form 8-K of Regency Realty Corporation and excludes material amounts,
described in note 1 to the statement of revenues and certain expenses, that
would not be comparable to those resulting from the proposed future
operations of the property.
In our opinion, the statement of revenues and certain expenses referred to
above presents fairly, in all material respects, the revenue and certain
expenses (as defined above) of Union Square Shopping Center for the year
ended December 31, 1995, in conformity with generally accepted accounting
principles.
/s/ KPMG Peat Marwick LLP
=============================
KPMG Peat Marwick LLP
Certified Public Accountants
Jacksonville, Florida
August 9, 1996
UNION SQUARE SHOPPING CENTER
Statement of Revenues and Certain Expenses
Year ended December 31, 1995
Real estate operation revenues:
Minimum rent $ 633,605
Percentage rent 6,974
Recoveries from tenants 139,995
---------
780,574
---------
Real estate operation expenses:
Operating and maintenance 73,665
Management fees 37,479
Real estate taxes 66,762
General and administrative 3,057
---------
180,963
---------
Revenues in excess of certain expenses $ 599,611
=========
See accompanying notes to statement of revenues and certain expenses.
UNION SQUARE SHOPPING CENTER
Notes to Statement of Revenues and Certain Expenses
Year ended December 31, 1995
1. Basis of Presentation
The statement of revenues and certain expenses relates to the operation
of a 97,191 square foot shopping center (the "Property") located in
Monroe, North Carolina.
The Property's records are maintained on the cash basis which is used
for Federal income tax reporting purposes. Adjustments have been made
to present the accompanying financial statement on the accrual basis of
accounting in conformity with generally accepted accounting principles.
Subsequent to December 31, 1995, the Property was acquired by Regency
Realty Corporation (RRC) in a transaction accounted for as a purchase.
All operations of the Property will be included in the consolidated
financial statements of RRC beginning at the acquisition date.
The accompanying financial statement is not representative of the actual
operation for the period presented as certain expenses, which may not be
comparable to the expenses expected to be incurred by RRC in the
proposed future operation of the Property, have been excluded. RRC is
not aware of any material factors relating to the Property that would
cause the reported financial information not to be necessarily
indicative of future operating results. Costs not directly related to
the operation of the Property have been excluded, and consist of
interest, depreciation, professional fees, and various other non
operating expenses.
2. Operating Leases
During 1995, two tenants paid minimum rent that exceeded 10% of the
total minimum rent earned by the Property. The tenants, and the minimum
rent paid, are as follows:
Harris-Teeter Supermarkets $198,000
Consolidated Theatre 203,755
=========
UNION SQUARE SHOPPING CENTER
Notes to Statement of Revenues and Certain Expenses
Year ended December 31, 1995
2. Operating Leases, continued
The Property is leased to tenants under operating leases with expiration
dates extending to the year 2009. Future minimum rent under
noncancelable operating leases excluding tenant reimbursements of
operating expenses and excluding additional contingent rentals based on
tenants' sales volume, as of December 31, 1995 are as follows:
Year ending December 31, Amount
1996 $ 733,599
1997 815,185
1998 822,072
1999 821,178
2000 826,796
=========
Independent Auditors' Report
The Board of Directors
Regency Realty Corporation:
We have audited the accompanying statement of revenues and certain expenses
(defined as being gross income less operating costs and expenses, exclusive of
expenses not directly related to the operation of the property) of Palm Harbour
Shopping Village for the year ended December 31, 1995. This financial statement
is the responsibility of management. Our responsibility is to express an opinion
on this statement of revenues and certain expenses based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the statement of revenues and
certain expenses is free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the statement of revenues and certain expenses. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall presentation of the statement
of revenues and certain expenses. We believe that our audit provides a
reasonable basis for our opinion.
The accompanying statement of revenues and certain expenses of Palm Harbour
Shopping Village was prepared for the purposes of complying with the rules
and regulations of the Securities and Exchange Commission for inclusion in
the Form 8-K of Regency Realty Corporation and excludes material amounts,
described in note 1 to the statement of revenues and certain expenses, that
would not be comparable to those resulting from the proposed future
operations of the property.
In our opinion, the statement of revenues and certain expenses referred to
above presents fairly, in all material respects, the revenue and certain
expenses (as defined above) of Palm Harbour Shopping Village for the year
ended December 31, 1995, in conformity with generally accepted accounting
principles.
/s/ KPMG Peat Marwick LLP
=================================
KPMG Peat Marwick LLP
Certified Public Accountants
Jacksonville, Florida
August 27, 1996
PALM HARBOUR SHOPPING VILLAGE
Statement of Revenues and Certain Expenses
Year ended December 31, 1995
Real estate operation revenues:
Minimum rent $ 1,314,399
Percentage rent 19,613
Recoveries from tenants 325,790
-----------
1,659,802
-----------
Real estate operation expenses:
Operating and maintenance 249,740
Management fees 68,439
Real estate taxes 139,138
General and administrative 14,460
-----------
471,777
-----------
Revenues in excess of certain expenses $ 1,188,025
===========
See accompanying notes to statement of revenues and certain expenses.
PALM HARBOUR SHOPPING VILLAGE
Notes to Statement of Revenues and Certain Expenses
Year ended December 31, 1995
1. Basis of Presentation
The statement of revenues and certain expenses relates to the operation
of a 159,369 square foot shopping center (the "Property") located in
Palm Coast, Florida.
The Property's records are maintained on the modified cash basis which
is used for Federal income tax reporting purposes. Adjustments have
been made to present the accompanying financial statement on the accrual
basis of accounting in conformity with generally accepted accounting
principles.
Subsequent to December 31, 1995, the Property was acquired by Regency
Realty Corporation (RRC) in a transaction accounted for as a purchase.
All operations of the Property will be included in the consolidated
financial statements of RRC beginning at the acquisition date.
The accompanying financial statement is not representative of the actual
operations for the period presented as certain expenses, which may not
be comparable to the expenses expected to be incurred by RRC in the
proposed future operation of the Property, have been excluded. RRC is
not aware of any material factors relating to the Property that would
cause the reported financial information not to be necessarily
indicative of future operating results. Costs not directly related to
the operation of the Property have been excluded, and consist of
interest, depreciation, professional fees, and various other non
operating expenses.
2. Operating Leases
During 1995, two tenants paid minimum rent that exceeded 10% of the
total minimum rent earned by the Property. The tenants, and the minimum
rent paid, are as follows:
Publix Supermarkets $ 269,268
Bealls 213,600
=========
PALM HARBOUR SHOPPING VILLAGE
Notes to Statement of Revenues and Certain Expenses
Year ended December 31, 1995
2. Operating Leases, continued
The Property is leased to tenants under operating leases with expiration
dates extending to the year 2009. Future minimum rent under
noncancelable operating leases excluding tenant reimbursements of
operating expenses and excluding additional contingent rentals based on
tenants' sales volume, as of December 31, 1995 are as follows:
Year ending December 31, Amount
1996 $ 1,400,576
1997 1,332,765
1998 1,158,339
1999 905,838
2000 777,351
=========
REGENCY REALTY CORPORATION
Pro Forma Condensed Consolidated Balance Sheet
June 30, 1996
(Unaudited)
(in thousands)
The following unaudited pro forma consolidated balance sheet is based upon
the historical consolidated balance sheet of the Company as of June 30, 1996 as
if the Company had acquired the Acquisition Properties as of that date. This pro
forma consolidated balance sheet should be read in conjunction with the
Company's quarterly report filed on Form 10-Q for the quarter ended June 30,
1996, and the pro forma consolidated statement of operations of the Company and
notes thereto included elsewhere herein.
The unaudited pro forma consolidated balance sheet is not necessarily
indicative of what the actual financial position of the Company would have been
at June 30, 1996, nor does it purport to represent the future financial position
of the Company.
Regency Regency
Realty Realty
Corporation Acquisition Corporation
Assets Historical Properties Pro Forma
Real estate rental property, at cost,
less accumulated depreciation $ 277,370 25,726 (a) 303,096
Cash and cash equivalents 6,167 - 6,167
Deferred costs, accounts
receivable, and other assets 7,258 - 7,258
--------- ---------- ---------
$ 290,795 25,726 316,521
========= ========== =========
Liabilities and Stockholders' Equity
Liabilities:
Mortgage loans payable 99,244 - 99,244
Unsecured line of credit 38,857 9,258 (b) 48,115
Accounts payable and other liabilities 6,288 - 6,288
-------- --------- -----------
Total liabilities 144,389 9,258 153,647
--------- ---------- -----------
Convertible operating partnership units 168 - 168
--------- --------- ---------
Stockholders' equity:
Common stock $.01 par value per share 69 9 (b) 78
Class B common stock 25 - 25
Additional paid in capital 159,163 16,459 (b) 175,622
Distributions in excess of net income (9,849) - (9,849)
Executive officer stock loans (3,170) - (3,170)
--------- --------- ---------
Total stockholders' equity 146,238 16,468 162,706
--------- --------- ---------
$ 290,795 25,726 316,521
========= ========= =========
See accompanying notes to unaudited pro forma condensed consolidated balance
sheet.
REGENCY REALTY CORPORATION
Notes to Pro Forma Condensed Consolidated Balance Sheet
June 30, 1996
(Unaudited)
(a) Represents the aggregate purchase price for the Acquisition Properties.
Purchase
Price
Union Square Shopping Center $ 7,189
City View Shopping Center 5,570
Palm Harbour Shopping Village 12,967
---------
$ 25,726
=========
Note 1: Welleby Plaza was acquired on May 31, 1996 for a purchase price
of $7,251 and is included in the historical balance sheet as of
June 30, 1996.
(b) Reflects the net draw on the Company's $75 million unsecured acquisition
and development line of credit. On July 10, 1996, the Company sold 934
shares to Security Capital US Realty for a total purchase price of
$16,468. These proceeds were used to paydown the line of credit.
Total draws for property acquisitions $ 25,726
Total paydown from stock issuance (16,468)
---------
Net loan draw $ 9,258
=========
REGENCY REALTY CORPORATION
Pro Forma Consolidated Statements of Operations
For the Six Month Period ended June 30, 1996 and
the Year Ended December 31, 1995
Unaudited
(in thousands, except per share data)
The following unaudited pro forma consolidated statements of operations are
based upon the historical consolidated statements of operations for the six
months ended June 30, 1996 and the year ended December 31, 1995 and are
presented as if the Company had acquired the Acquisition Properties as of
January 1, 1996 and 1995, respectively. These pro forma consolidated statements
of operations should be read in conjunction with the Company's 1995 Form 10-K,
its quarterly report filed on Form 10-Q dated June 30, 1996, the pro forma
consolidated balance sheet of the Company, and the Statement of Revenue and
Certain Expenses of the Acquisition Properties and notes thereto included
elsewhere herein.
The unaudited pro forma consolidated statements of operations are not
necessarily indicative of what the actual results of the Company would have been
assuming the transactions had been completed as set forth above, nor does it
purport to represent the Company's results of operations in future periods.
For the Six Months Ended June 30, 1996
------------------------------------------------------------
Regency Regency
Realty Realty
Corporation Acquisition Pro Forma Corporation
Historical Properties Adjustments Pro Forma
(a)
Real estate operation revenues:
Minimum rent $ 16,001 1,721 0 17,722
Percentage rent 424 0 0 424
Recoveries from tenants and other charges 3,508 388 0 3,896
Leasing and brokerage 1,244 0 0 1,244
Management fees 277 0 0 277
--------- ---------- ---------- -----------
Total real estate operation revenues 21,454 2,109 0 23,563
--------- ---------- ---------- -----------
Real estate operation expenses:
Depreciation and amortization 3,905 0 320 (b) 4,225
Operating and maintenance 3,460 425 0 3,885
General and administrative 2,604 0 0 2,604
Real estate taxes 1,912 205 0 2,117
----------- ------------ ------------ -----------
Total real estate operation expenses 11,881 630 320 12,831
----------- ------------ ------------ -----------
Interest expense (income):
Interest expense 4,630 0 306 (c) 4,936
Interest income (287) 0 0 (287)
----------- ------------ ------------ -----------
Net interest expense 4,343 0 306 4,649
----------- ------------ ------------ -----------
Net income 5,230 1,479 (626) 6,083
Preferred stock dividends 58 0 0 58
----------- ------------ ------------ -----------
Net income for common stockholders $ 5,172 1,479 (626) 6,025
=========== ============ ============ ===========
Net income for common stockholders $ 0.53 0.56
=========== ===========
Weighted average common shares outstanding 9,850 10,784
=========== ===========
See accompanying notes to unaudited pro forma statement of operations.
REGENCY REALTY CORPORATION
Pro Forma Consolidated Statements of Operations (Continued)
Unaudited
(in thousands, except per share data)
For the Year Ended December 31, 1995
----------------------------------------------------------
Regency Regency
Realty Realty
Corporation Acquisition Pro Forma Corporation
Historical Properties Adjustments Pro Forma
(a)
Real estate operation revenues:
Minimum rent $ 25,044 3,483 0 28,527
Percentage rent 673 0 0 673
Recoveries from tenants and other charges 5,842 817 0 6,659
Leasing and brokerage 1,639 0 0 1,639
Management fees 787 0 0 787
---------- ---------- ----------- -----------
Total real estate operation revenues 33,985 4,300 0 38,285
---------- ---------- ----------- -----------
Real estate operation expenses:
Depreciation and amortization 6,436 0 641 (b) 7,077
Operating and maintenance 5,683 887 0 6,570
General and administrative 4,894 0 0 4,894
Real estate taxes 3,001 426 0 3,427
---------- ---------- ----------- -----------
Total real estate operation expenses 20,014 1,313 641 21,968
---------- ---------- ----------- -----------
Interest expense (income):
Interest expense 8,840 0 611 (c) 9,451
Interest income (454) 0 0 (454)
---------- ---------- ----------- -----------
Net interest expense 8,386 0 611 8,997
---------- ---------- ----------- -----------
Net income 5,585 2,987 (1,252) 7,320
Preferred stock dividends 591 0 0 591
---------- ---------- ----------- -----------
Net income for common stockholders $ 4,994 2,987 (1,252) 6,729
========== ========== =========== ===========
Net income for common stockholders $ 0.75 0.89
========== ===========
Weighted average common shares outstanding 6,630 7,564
============ ===========
See accompanying notes to unaudited pro forma statement of operations.
REGENCY REALTY CORPORATION
Notes to Pro Forma Consolidated Statements of Operations
For the Six Month Period Ended June 30, 1996 and
the Year Ended December 31, 1995
Unaudited
(in thousands, except per share data)
(a) Reflects revenues and certain expenses of the Acquisition Properties for
the periods ended as follows:
For the six months ended June 30, 1996
------------------------------------------------------
Minimum Tenant Operating & Real
Shopping Center Rents Recoveries Maintenance Estate Taxes
Welleby Plaza $ 383 103 154 74
Union Square Shopping Center 310 86 60 33
City View Shopping Center 322 34 61 24
Palm Harbour Village 706 165 150 74
------------ ----------- ---------- ----------
$ 1,721 388 425 205
============ =========== ========== ==========
For the year ended December 31, 1995
---------------------------------------------------------
Minimum Tenant Operating & Real
Shopping Center Rents Recoveries Maintenance Estate Taxes
Welleby Plaza $ 884 247 330 178
Union Square Shopping Center 641 140 114 67
City View Shopping Center 624 104 110 42
Palm Harbour Village 1,334 326 333 139
----------- ----------- ---------- -----------
$ 3,483 817 887 426
=========== =========== ========== ===========
REGENCY REALTY CORPORATION
Notes to Pro Forma Consolidated Statements of Operations (continued)
Unaudited
(in thousands, except per share data)
(b) Depreciation expense is based upon the costs allocated to the buildings
acquired with a useful life equal to forty years.
For the year ended December 31, 1995
----------------------------------------------------------------
Building Annual
Shopping Center Cost Year Built Useful Life Depreciation
Welleby Plaza $ 5,363 1982 40 $ 134
Union Square Shopping Center 5,622 1989 40 141
City View Shopping Center 4,310 1993 40 108
Palm Harbour Village 10,343 1978 (*) 40 258
-------
Annual depreciation expense $ 641
=======
Semi-annual depreciation expense $ 320
=======
(*) Expanded in 1991 to expand Publix and add Bealls and in 1994 to add
Blockbusters and Boston Market
(c) To reflect interest expense on the acquisition and development line of
credit for net draws for property acquisitions in the amount of $9,258 at
an average interest rate of 7.4%
Annual
Interest
$ 611
========
Semi-annual interest expense $ 306
========
