x
|
Quarterly
Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
|
¨
|
Transition
Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
|
Maryland
|
38-3148187
|
(State
or other jurisdiction
|
(I.R.S.
Employer
|
of
incorporation or organization)
|
Identification
No.)
|
31850
Northwestern Highway, Farmington Hills, Michigan
|
48334
|
(Address
of principal executive offices)
|
(Zip
code)
|
Yes x
|
No ¨
|
Yes ¨
|
No ¨
|
Large
Accelerated Filer
¨
|
Accelerated
Filer
x
|
Non-accelerated
Filer ¨
|
Smaller
reporting
company
¨
|
(Do
not check if a smaller reporting
company)
|
Yes ¨
|
No x
|
Page | ||
Part
I:
|
Financial
Information
|
|
Item
1.
|
Interim
Consolidated Financial Statements
|
|
Consolidated
Balance Sheets as of March 31, 2010 (Unaudited) and December 31,
2009
|
1-2
|
|
Consolidated
Statements of Income (Unaudited) for the three months ended March 31, 2010
and 2009
|
3
|
|
Consolidated
Statements of Stockholders’ Equity (Unaudited) for the three months ended
March 31, 2010
|
4
|
|
Consolidated
Statements of Cash Flows (Unaudited) for the three months ended March 31,
2010 and 2009
|
5-6
|
|
Notes
to Consolidated Financial Statements (Unaudited)
|
7-11
|
|
Item
2.
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
|
12-17
|
Item
3.
|
Quantitative
and Qualitative Disclosures About Market Risk
|
17-18
|
Item
4.
|
Controls
and Procedures
|
18
|
Part
II:
|
Other
Information
|
|
Item
1.
|
Legal
Proceedings
|
18
|
Item
1A.
|
Risk
Factors
|
18
|
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
18
|
Item
3.
|
Defaults
Upon Senior Securities
|
19
|
Item
4.
|
{Removed
and Reserved}
|
19
|
Item
5
|
Other
Information
|
19
|
Item
6.
|
Exhibits
|
19
|
Signatures
|
20
|
March
31
|
December 31,
|
|||||||
2010
|
2009
|
|||||||
(Unaudited)
|
||||||||
Assets
|
||||||||
Real
Estate Investments
|
||||||||
Land
|
$ | 92,692,037 | $ | 95,047,459 | ||||
Buildings
|
217,626,796 | 220,604,734 | ||||||
Property
under development
|
5,200,831 | 4,791,975 | ||||||
315,519,664 | 320,444,168 | |||||||
Less
accumulated depreciation
|
(64,311,743 | ) | (64,076,469 | ) | ||||
Net
Real Estate Investments
|
251,207,921 | 256,367,699 | ||||||
Cash
and Cash Equivalents
|
565,298 | 688,675 | ||||||
Cash
– Restricted
|
9,772,416 | - | ||||||
Accounts Receivable - Tenants,
net of allowance of $35,000
|
||||||||
at
March 31, 2010 and December 31, 2009
|
2,650,539 | 1,986,836 | ||||||
Unamortized
Deferred Expenses
|
||||||||
Financing
costs, net of accumulated amortization of $5,192,918 and $5,126,333 at
March 31, 2010 and December 31, 2009
|
1,294,578 | 1,360,514 | ||||||
Leasing
costs, net of accumulated amortization of $860,454 and $841,427 at March
31, 2010 and December 31, 2009
|
569,423 | 537,100 | ||||||
Other
Assets
|
892,463 | 847,894 | ||||||
$ | 266,952,638 | $ | 261,788,718 |
March 31,
|
December 31,
|
|||||||
2010
|
2009
|
|||||||
(Unaudited)
|
||||||||
Liabilities
and Stockholders’ Equity
|
||||||||
Mortgages
Payable
|
$ | 74,570,943 | $ | 75,552,802 | ||||
Notes
Payable
|
29,797,500 | 29,000,000 | ||||||
Dividends
and Distributions Payable
|
4,375,999 | 4,354,163 | ||||||
Deferred
Revenue
|
9,862,917 | 10,035,304 | ||||||
Accrued
Interest Payable
|
260,106 | 261,012 | ||||||
Accounts
Payable
|
||||||||
Capital
expenditures
|
438,749 | 352,430 | ||||||
Operating
|
1,089,295 | 1,529,085 | ||||||
Interest
Rate Swap
|
370,547 | 74,753 | ||||||
Deferred
Income Taxes
|
705,000 | 705,000 | ||||||
Tenant
Deposits
|
91,820 | 97,285 | ||||||
Total
Liabilities
|
121,562,876 | 121,961,834 | ||||||
Stockholders’
Equity
|
||||||||
Common
stock, $0.0001 par value; 13,350,000 shares authorized, 8,252,014 and
8,196,074 shares issued and outstanding
|
825 | 820 | ||||||
Excess
stock, $0.0001 par value, 6,500,000 shares authorized, 0 shares issued and
outstanding
|
— | — | ||||||
Series
A junior participating preferred stock, $0.0001 par value, 150,000 shares
authorized, 0 shares issued and outstanding
|
— | — | ||||||
Additional
paid-in capital
|
147,742,101 | 147,466,101 | ||||||
Deficit
|
(5,275,237 | ) | (10,632,798 | ) | ||||
Accumulated
other comprehensive income (loss)
|
(355,577 | ) | (70,806 | ) | ||||
Total
stockholders’ equity—Agree Realty Corporation
|
142,112,112 | 136,763,317 | ||||||
Non-controlling
interest
|
3,277,650 | 3,063,567 | ||||||
Total
Stockholders’ Equity
|
145,389,762 | 139,826,884 | ||||||
$ | 266,952,638 | $ | 261,788,718 |
Three Months Ended
|
Three Months Ended
|
|||||||
March 31, 2010
|
March 31, 2009
|
|||||||
Revenues
|
||||||||
Minimum
rents
|
$ | 8,437,272 | $ | 8,331,333 | ||||
Percentage
rents
|
465 | 6,995 | ||||||
Operating
cost reimbursements
|
669,815 | 718,623 | ||||||
Development
fee income
|
397,009 | - | ||||||
Other
income
|
17,771 | 3,761 | ||||||
Total
Revenues
|
9,522,332 | 9,060,712 | ||||||
Operating
Expenses
|
||||||||
Real
estate taxes
|
489,362 | 478,941 | ||||||
Property
operating expenses
|
395,680 | 457,787 | ||||||
Land
lease payments
|
226,575 | 214,800 | ||||||
General
and administrative
|
1,251,729 | 1,251,290 | ||||||
Depreciation
and amortization
|
1,431,727 | 1,394,498 | ||||||
Total
Operating Expenses
|
3,795,073 | 3,797,316 | ||||||
Income
From Operations
|
5,727,259 | 5,263,396 | ||||||
Other
Expense
|
- | |||||||
Interest
expense, net
|
(1,269,757 | ) | (1,125,624 | ) | ||||
Income
Before Discontinued Operations
|
4,457,502 | 4,137,772 | ||||||
Gain
on sale of asset from discontinued operations
|
5,331,685 | - | ||||||
Income
from discontinued operations
|
179,293 | 179,293 | ||||||
Net
Income
|
9,968,480 | 4,317,065 | ||||||
Less
Net Income Attributable to Non-Controlling Interest
|
(402,392 | ) | (306,419 | ) | ||||
Net
Income Attributable to Agree Realty Corporation
|
$ | 9,566,088 | $ | 4,010,646 | ||||
Earnings
Per Share – Basic
|
$ | 1.18 | $ | 0.52 | ||||
Earnings
Per Share – Dilutive
|
$ | 1.18 | $ | 0.52 | ||||
Dividend
Declared Per Share
|
$ | 0.51 | $ | 0.50 | ||||
Weighted
Average Number of Common Shares Outstanding – Basic
|
8,096,615 | 7,774,640 | ||||||
Weighted
Average Number of Common Shares Outstanding – Dilutive
|
8,130,290 | 7,781,740 |
Additional
|
Accumulated
Other
|
|||||||||||||||||||||||
Common Stock
|
Paid-In
|
Non-Controlling
|
Comprehensive
|
|||||||||||||||||||||
Shares
|
Amount
|
Capital
|
Interest
|
Deficit
|
Income (loss)
|
|||||||||||||||||||
Balance, January 1,
2010
|
8,196,074 | $ | 820 | $ | 147,466,101 | $ | 3,063,567 | $ | (10,632,798 | ) | $ | (70,806 | ) | |||||||||||
Issuance
of shares under the Equity Incentive Plan
|
76,550 | 8 | — | — | — | — | ||||||||||||||||||
Forfeiture
of shares
|
(20,610 | ) | (3 | ) | — | — | — | — | ||||||||||||||||
Vesting
of restricted stock
|
— | — | 276,000 | — | — | — | ||||||||||||||||||
Dividends
and distributions declared for the period January 1, 2010 to March 31,
2010
|
— | — | — | (177,286 | ) | (4,208,527 | ) | — | ||||||||||||||||
Other
comprehensive (loss)
|
— | — | — | (11,023 | ) | — | (284,771 | ) | ||||||||||||||||
Net
income for the period January 1, 2010 to March 31, 2010
|
— | — | — | 402,392 | 9,566,088 | — | ||||||||||||||||||
Balance, March 31,
2010
|
8,252,014 | $ | 825 | $ | 147,742,101 | $ | 3,277,650 | $ | (5,275,237 | ) | $ | (355,577 | ) |
Three Months Ended
|
Three Months Ended
|
|||||||
March 31, 2010
|
March 31, 2009
|
|||||||
Cash
Flows From Operating Activities
|
||||||||
Net
income
|
$ | 9,968,480 | $ | 4,317,065 | ||||
Adjustments
to reconcile net income to net cash provided by operating
Activities
|
||||||||
Depreciation
|
1,412,700 | 1,378,475 | ||||||
Amortization
|
85,612 | 85,443 | ||||||
Stock-based
compensation
|
276,000 | 292,000 | ||||||
Gain
on sale of asset
|
(5,331,685 | ) | - | |||||
(Increase)
decrease in accounts receivable
|
(663,703 | ) | 88,341 | |||||
(Increase)
decrease in other assets
|
(56,478 | ) | 27,880 | |||||
Decrease
in accounts payable
|
(439,790 | ) | (306,453 | ) | ||||
Decrease
in deferred revenue
|
(172,387 | ) | (172,387 | ) | ||||
(Decrease)
in accrued interest
|
(906 | ) | (254,030 | ) | ||||
(Decrease)
in tenant deposits
|
(5,465 | ) | - | |||||
Net
Cash Provided By Operating Activities
|
5,072,378 | 5,456,334 | ||||||
Cash
Flows From Investing Activities
|
||||||||
Acquisition
of real estate investments (including capitalized interest of $49,255 in
2010 and $76,273 in 2009)
|
(235,377 | ) | (1,241,563 | ) | ||||
Net
proceeds from sale of assets, less amounts held in restricted
escrow
|
(7,613 | ) | - | |||||
Net
Cash Used In Investing Activities
|
(242,990 | ) | (1,241,563 | ) | ||||
Cash
Flows From Financing Activities
|
||||||||
Payments
of mortgages payable
|
(981,859 | ) | (828,267 | ) | ||||
Dividends
and limited partners’ distributions paid
|
(4,363,977 | ) | (4,250,468 | ) | ||||
Line-of-credit
net borrowings (repayments)
|
797,500 | 1,560,000 | ||||||
Repayments
of capital expenditure payables
|
(352,430 | ) | (850,225 | ) | ||||
Payments
of financing costs
|
(649 | ) | (177,199 | ) | ||||
Payments
of leasing costs
|
(51,350 | ) | (75,000 | ) | ||||
Net
Cash Used In Financing Activities
|
(4,952,765 | ) | (4,621,159 | ) | ||||
Net
Decrease In Cash and Cash Equivalents
|
(123,377 | ) | (406,388 | ) | ||||
Cash and Cash
Equivalents, beginning of period
|
688,675 | 668,677 | ||||||
Cash and Cash
Equivalents, end of period
|
$ | 565,298 | $ | 262,289 |
Three Months Ended
|
Three Months Ended
|
|||||||
March 31, 2010
|
March 31, 2009
|
|||||||
Supplemental
Disclosure of Cash Flow Information
|
||||||||
Cash
paid for interest (net of amounts capitalized)
|
$ | 1,204,078 | $ | 1,310,234 | ||||
Supplemental
Disclosure of Non-Cash Transactions
|
||||||||
Dividends
and limited partners’ distributions declared and unpaid
|
$ | 4,375,999 | $ | 4,250,979 | ||||
Real
estate investments financed with accounts payable
|
$ | 438,749 | $ | 617,631 |
1.
|
Basis
of Presentation
|
The
accompanying unaudited consolidated financial statements of Agree Realty
Corporation (the “Company”) for the three months ended March 31, 2010 have
been prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-Q
and Article 10 of Regulation S-X. Accordingly, they do not include all of
the information and footnotes required by generally accepted accounting
principles for audited financial statements. In the opinion of management,
all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included. The consolidated
balance sheet at December 31, 2009 has been derived from the audited
consolidated financial statements at that date. Operating results for the
three months ended March 31, 2010 are not necessarily indicative of the
results that may be expected for the year ending December 31, 2010 or for
any other interim period. For further information, refer to the audited
consolidated financial statements and footnotes thereto included in the
Company’s Annual Report on Form 10-K for the year ended December 31,
2009.
We
have evaluated subsequent events since March 31, 2010 for events requiring
recording or disclosure in this quarterly report on Form
10-Q.
|
|
2.
|
Stock
Based Compensation
|
The
Company estimates the fair value of restricted stock and stock option
grants at the date of grant and amortizes those amounts into expense on a
straight line basis or amount vested, if greater, over the appropriate
vesting period.
|
|
As
of March 31, 2010, there was $3,442,346 unrecognized compensation costs
related to the outstanding restricted shares, which is expected to be
recognized over a weighted average period of 3.77 years. The
Company used a 0% discount factor and forfeiture rate for determining the
fair value of restricted stock. The forfeiture rate was based
on historical results and trends.
The
holder of a restricted share award is generally entitled at all times on
and after the date of issuance of the restricted shares to exercise the
rights of a stockholder of the Company, including the right to vote the
shares and the right to receive dividends on the
shares.
|
Shares
Outstanding
|
Weighted
Average
Grant Date
Fair Value
|
|||||||
Unvested
restricted shares at January 1, 2010
|
140,980 | $ | 22.40 | |||||
Restricted
shares granted
|
76,550 | 22.52 | ||||||
Restricted
shares vested
|
(30,600 | ) | 22.60 | |||||
Restricted
shares forfeited
|
(20,610 | ) | 16.88 | |||||
Unvested
restricted shares at March 31, 2010
|
166,320 | $ | 22.40 |
3.
|
Earnings
Per Share
|
Earnings
per share has been computed by dividing the net income attributable to
Agree Realty Corporation by the weighted average number of common shares
outstanding.
The
following is a reconciliation of the denominator of the basic net earnings
per common share computation to the denominator of the diluted net
earnings per common share computation for each of the periods
presented:
|
Three
Months Ended
March
31,
|
||||||||
2010
|
2009
|
|||||||
Weighted
average number of common shares outstanding
|
8,264,495 | 7,924,320 | ||||||
Unvested
restricted stock
|
(167,880 | ) | (149,680 | ) | ||||
Weighted
average number of common shares outstanding used in basic earnings per
share
|
8,096,615 | 7,774,640 | ||||||
Weighted
average number of common shares outstanding used in basic earnings per
share
|
8,096,615 | 7,774,640 | ||||||
Effect
of dilutive securities:
|
||||||||
Restricted
stock
|
33,675 | 7,100 | ||||||
Common
stock options
|
— | — | ||||||
Weighted
average number of common shares outstanding used in diluted earnings per
share
|
8,130,290 | 7,781,740 |
4.
|
Subsequent
Event
|
On
April 16, 2010, we completed a secondary offering of 1,495,000 shares of
common stock. The offering, which included the exercise of the
over-allotment option by the underwriter, raised approximately $31.1
million. The proceeds from the offering were used to pay down
amounts outstanding under our credit
facilities.
|
5.
|
Derivative
Instruments and Hedging Activity
|
On
January 2, 2009, the Company entered into an interest rate swap agreement
for a notional amount of $24,501,280, effective on January 2, 2009 and
ending on July 1, 2013. The notional amount decreases over the term to
match the outstanding balance of the hedged borrowing. The Company entered
into this derivative instrument to hedge against the risk of changes in
future cash flows related to changes in interest rates on $24,501,280 of
the total variable-rate borrowings outstanding. Under the terms of the
interest rate swap agreement, the Company will receive from the
counterparty interest on the notional amount based on 1.5% plus one-month
LIBOR and will pay to the counterparty a fixed rate of 3.744%. This swap
effectively converted $24,501,280 of variable-rate borrowings to
fixed-rate borrowings beginning on January 2, 2009 and through July 1,
2013.
Companies
are required to recognize all derivative instruments as either assets or
liabilities at fair value on the balance sheet. The Company has designated
this derivative instrument as a cash flow hedge. As such, changes in the
fair value of the derivative instrument are recorded as a component of
other comprehensive income (loss) (“OCI”) for the three months ended March
31, 2010 to the extent of effectiveness. The ineffective portion of the
change in fair value of the derivative instrument is recognized in
interest expense. For the three months ending March 31, 2010,
the Company has determined this derivative instrument to be an effective
hedge.
The
Company does not use derivative instruments for trading or other
speculative purposes and we did not have any other derivative instruments
or hedging activities as of March 31,
2010.
|
6.
|
Fair
Value of Financial Instruments
|
Certain
of our assets and liabilities are disclosed at fair value. Fair value is
the price that would be received to sell an asset or paid to transfer a
liability in an orderly transaction between market participants at the
measurement date. In determining fair value, the Company uses
various valuation methods including the market, income and cost
approaches. The assumptions used in the application of these
valuation methods are developed from the perspective of market
participants, pricing the asset or liability. Inputs used in
the valuation methods can be either readily observable, market
corroborated, or generally unobservable inputs. Whenever
possible the Company attempts to utilize valuation methods that maximize
the uses of observable inputs and minimizes the use of unobservable
inputs. Based on the operability of the inputs used in the
valuation methods the Company is required to provide the following
information according to the fair value hierarchy. The fair
value hierarchy ranks the quality and reliability of the information used
to determine fair values. Assets and liabilities measured,
reported and/or disclosed at fair value will be classified and disclosed
in one of the following three categories:
Level
1 – Quoted market prices in active markets for identical assets or
liabilities.
Level
2 – Observable market based inputs or unobservable inputs that are
corroborated by market data.
Level
3 – Unobservable inputs that are not corroborated by market
data.
The
table below sets forth our fair value hierarchy for liabilities measured
or disclosed at fair value as of March 31,
2010.
|
Level 1
|
Level 2
|
Level 3
|
||||||||||
Liability:
|
||||||||||||
Interest
rate swap
|
$ | — | $ | 370,547 | $ | — | ||||||
Fixed
rate mortgage
|
$ | — | $ | — | $ | 47,910,700 | ||||||
Variable
rate mortgage
|
$ | — | $ | — | $ | 21,492,645 | ||||||
Variable
rate debt
|
$ | — | $ | 29,797,000 | $ | — |
The
carrying amounts of the Company’s short-term financial instruments, which
consist of cash, cash equivalents, receivables, and accounts payable,
approximate their fair values. The fair value of the interest rate swap
was derived using estimates to settle the interest rate swap agreement,
which is based on the net present value of expected future cash flows on
each leg of the swap utilizing market-based inputs and discount rates
reflecting the risks involved. The fair value of fixed and
variable rate mortgages was derived using the present value of future
mortgage payments based on estimated current market interest
rates. The fair value of variable rate debt is estimated to be
equal to the face value of the debt because the interest rates are
floating and is considered to approximate fair
value.
|
7.
|
Total
Comprehensive Income (Loss)
|
The
following is a reconciliation of net income to comprehensive income
attributable to Agree Realty Corporation for the three months ended March
31, 2010 and 2009.
|
Three months ended
March 31, 2010
|
Three months ended
March 31, 2009
|
|||||||
Net
income
|
$ | 9,968,480 | $ | 4,317,065 | ||||
Other
comprehensive income (loss)
|
(370,547 | ) | (279,970 | ) | ||||
Total
comprehensive income before non-controlling interest
|
9,597,933 | 4,037,095 | ||||||
Less:
non-controlling interest
|
402,392 | 306,419 | ||||||
Total
comprehensive income after non-controlling interest
|
9,195,541 | 3,730,676 | ||||||
Add:
non-controlling interest of comprehensive loss
|
11,023 | 19,878 | ||||||
Comprehensive
income attributable to Agree Realty Corporation
|
$ | 9,206,564 | $ | 3,750,554 |
8.
|
Costs
and Estimated Earnings on Uncompleted Contracts
|
For
contracts where the Company does not retain ownership of the real
property, but the Company develops and receives fee income for managing
the development project, the Company uses the percentage of completion
accounting method. Under this approach, income is recognized
based on the status of the uncompleted contracts and the current estimates
of costs to complete. The percentage of completion is
determined by the relationship of costs incurred to the total estimated
costs of the contract. Provisions are made for estimated loses
on uncompleted contracts in the period in which such losses are
determined. Changes in job performance, job conditions, and
estimated profitability including those arising from contract penalty
provisions and final contract settlements, may result in revisions to
costs and income. Such revisions are recognized in the period
in which they are determined. Claims for additional
compensation due the Company are recognized in contract revenues when
realization is probable and the amount can be reliably
estimated.
|
Job-to-date
amounts for open projects at March 31, 2010 is as
follows:
|
Cost
incurred on uncompleted contracts
|
$ | 1,023,348 | |||
Estimated
earnings
|
806,652 | ||||
Earned
Revenue
|
1,830,000 | ||||
Less
billings to date
|
- | ||||
Total
|
$ | 1,830,000 |
Total
unbilled revenues at March 31, 2010 are $1,830,000 and are included in
accounts receivable – tenants on the consolidated balance
sheet.
|
9.
|
Notes
Payable
|
Agree
Limited Partnership (the “Operating Partnership”) has in place a $55
million Credit Facility with Bank of America, as the agent, which is
guaranteed by the Company. The Credit Facility was extended in
January 2009 and now matures in November 2011. Advances under
the Credit Facility bear interest within a range of one-month to 12-month
LIBOR plus 100 basis points to 150 basis points or the lender’s prime
rate, at the Company’s option, based on certain factors such as the ratio
of our indebtedness to the capital value of the Company’s properties
properties. The Credit Facility generally is used to fund
property acquisitions and development activities. As of March
31, 2010, $28,500,000 was outstanding under the Credit Facility bearing a
weighted average interest rate of 1.23%.
The
Company also has in place a $5 million Line of Credit that was extended in
October 2009 and now matures in November 2011. The Line of
Credit bears interest at the lender’s prime rate less 75 basis points or
150 basis points in excess of the one-month to 12-month LIBOR rate, at the
Company’s option. The purpose of the Line of Credit is
generally to provide working capital and fund land options and start-up
costs associated with new projects. As of March 31, 2010,
$1,297,500 was outstanding under the Line of Credit bearing a weighted
average interest rate of 2.50%.
|
|
10.
|
Discontinued
Operations
|
In
March 2010, the Company completed the sale of a single tenant property for
approximately $9.8 million. The property was leased to Borders
Group, Inc. and was located in Santa Barbara, California. The
results of operations for this property are presented as discontinued
operations in the Company’s Consolidated Statements of
Income. The revenues for the property were $179,293 and
$180,016 for the three months ended March 31, 2010 and 2009,
respectively. The expenses for the property were $-0- and $723
for the three months ended March 31, 2010 and 2009,
respectively.
|
|
11.
|
Restricted
Cash
|
Pursuant
to an agreement with an unrelated third party, cash held in escrow is for
the acquisition of real
estate.
|
ITEM 2.
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
|
Total
|
Apr 1, 2010 –
Ma 31, 2011
|
Apr 1, 2011 –
Mar 31, 2013
|
Apr 1, 2013 –
Mar 31, 2015
|
Thereafter
|
||||||||||||||||
Mortgages
Payable
|
$ | 74,571 | $ | 4,091 | $ | 9,023 | $ | 31,518 | $ | 29,939 | ||||||||||
Notes
Payable
|
29,797 | — | 29,797 | — | — | |||||||||||||||
Land
Lease Obligation
|
12,858 | 906 | 1,813 | 1,726 | 8,413 | |||||||||||||||
Estimated
Interest Payments on Mortgages and Notes Payable
|
19,060 | 3,791 | 6,441 | 4,987 | 3,841 | |||||||||||||||
Other
Long-Term Liabilities
|
— | — | — | — | — | |||||||||||||||
Total
|
$ | 136,286 | $ | 8,788 | $ | 47,074 | $ | 38,231 | $ | 42,193 |
Three Months Ended
March 31,
|
||||||||
2010
|
2009
|
|||||||
Net
income
|
$ | 9,968,480 | $ | 4,317,065 | ||||
Depreciation
of real estate assets
|
1,400,791 | 1,361,318 | ||||||
Amortization
of leasing costs
|
19,027 | 16,024 | ||||||
Gain
on sale of fixed asset
|
(5,331,685 | ) | - | |||||
Funds
from Operations
|
$ | 6,056,613 | $ | 5,694,407 | ||||
Weighted
Average Shares and Operating Partnership Units Outstanding –
Dilutive
|
8,477,909 | 8,387,153 |
ITEM 3.
|
QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK
|
Year ended March 31,
|
||||||||||||||||||||||||||||
2011
|
2012
|
2013
|
2014
|
2015
|
Thereafter
|
Total
|
||||||||||||||||||||||
Fixed
rate mortgage
|
$ | 3,597 | $ | 3,841 | $ | 4,102 | $ | 4,380 | $ | 4,677 | $ | 29,939 | $ | 50,536 | ||||||||||||||
Average
interest rate
|
6.56 | % | 6.56 | % | 6.56 | % | 6.56 | % | 6.56 | % | 6.56 | % | — | |||||||||||||||
Variable
rate mortgage
|
$ | 494 | $ | 524 | $ | 556 | $ | 22,461 | — | — | $ | 24,035 | ||||||||||||||||
Average
interest rate
|
3.74 | % | 3.74 | % | 3.74 | % | 3.74 | % | — | — | — | |||||||||||||||||
Other
variable rate debt
|
— | $ | 29,797 | — | — | — | $ | 29,797 | ||||||||||||||||||||
Average
interest rate
|
— | 1.29 | % | — | — | — | — |
ITEM 6.
|
EXHIBITS
|
|
3.1
|
Articles
of Incorporation and Articles of Amendment of the Company (incorporated by
reference to Exhibit 3.1 to the Company’s Registration Statement on Form
S-11 (Registration Statement No. 33-73858), as amended
|
|
3.2
|
Articles
Supplementary, establishing the terms of the Series A Preferred Stock
(incorporated by reference to Exhibit 3.1 to the Company’s Form 8-K (No.
001-12928) filed on December 9, 2008)
|
|
3.3
|
Articles
Supplementary, classifying additional shares of Common Stock and Excess
Stock (incorporated by reference to Exhibit 3.2 to the Company’s Form 8-K
(No. 001-12928) filed on December 9, 2008)
|
|
3.4
|
Bylaws
of the Company (incorporated by reference to Exhibit 3.2 to the Company’s
Form 10-K (No. 001-12928) for the year ended December 31,
2006)
|
|
*31.1
|
Certification
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, Richard Agree,
Chief Executive Officer and Chairman of the Board of
Directors
|
|
*31.2
|
Certification
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, Kenneth R.
Howe, Vice President, Finance and Secretary
|
|
*32.1
|
Certification
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, Richard Agree,
Chief Executive Officer and Chairman of the Board of
Directors
|
|
*32.2
|
|
Certification
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, Kenneth R.
Howe, Vice President, Finance and
Secretary
|
Agree
Realty Corporation
|
|
/s/
RICHARD AGREE
|
|
Richard
Agree
|
|
Chief
Executive Officer
|
|
and
Chairman of the Board of Directors
|
|
(Principal
Executive Officer)
|
|
/s/
KENNETH R. HOWE
|
|
Kenneth
R. Howe
|
|
Vice
President, Finance and
|
|
Secretary
|
|
(Principal
Financial and Accounting Officer)
|
|
Date:
May 10, 2010
|