8-K 1 g95914e8vk.txt NEW VALLEY CORPORATION ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): JUNE 14, 2005 ------------- NEW VALLEY CORPORATION ------------------------------------------------------ (Exact Name of Registrant as Specified in Its Charter) DELAWARE ------------------------------------------------------ (State or Other Jurisdiction of Incorporation) 1-2493 13-5482050 ------------------------ ------------------------------------ (Commission File Number) (I.R.S. Employer Identification No.) 100 S.E. SECOND STREET, MIAMI, FLORIDA 33131 ---------------------------------------- ----------- (Address of Principal Executive Offices) (Zip Code) (305) 579-8000 ------------------------------------------------------ (Registrant's Telephone Number, Including Area Code) (NOT APPLICABLE) ------------------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (SEE General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ================================================================================ ITEM 8.01. OTHER EVENTS On March 15, 2005, counsel for New Valley Corporation ("New Valley") and its majority stockholder, Vector Group Ltd. ("Vector"), advised the Delaware Chancery Court that the parties had settled a stockholder derivative suit filed against New Valley, as a nominal defendant, its directors and Brooke Group Holding Inc., an indirect wholly-owned subsidiary of Vector. The suit (Goodwin v. New Valley Corporation) alleged, among other things, that New Valley paid excessive consideration to purchase in 1997 Vector's BrookeMil Ltd. subsidiary, which was engaged in the real estate business in Russia. The defendants did not admit any wrongdoing as part of the settlement, which was subject to court approval. Pursuant to the settlement, Vector agreed to pay $7,000,000 to New Valley and New Valley agreed to pay legal fees and expenses, of up to $2,150,000. On June 14, 2005, the Delaware Chancery Court entered a Final Order approving the settlement and the related legal fees and expenses. Under the terms of the settlement, New Valley paid $2,150,000 of legal fees on June 16, 2005 and Vector is obligated to pay $7,000,000 to New Valley five business days after the expiration of the 30-day appeal period. New Valley will record the receipt of $7,000,000 as additional paid-in-capital upon receipt. New Valley accrued the legal fees and expenses of $2,150,000 during the year ended December 31, 2004 and charged the amount to general and administrative expenses. 2 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 hereunto duly authorized. NEW VALLEY CORPORATION /s/ J. BRYANT KIRKLAND III ---------------------------------- Date: June 20, 2005 J. Bryant Kirkland III Vice President, Treasurer and Chief Financial Officer 3

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) : February 16, 2005

NEW VALLEY CORPORATION

(Exact Name of Registrant as Specified in Its Charter)

DELAWARE

(State or Other Jurisdiction of Incorporation)

1-2493		13-5482050
(Commission File Number)		(I.R.S. Employer Identification No.)
100 S.E. Second Street, Miami, Florida		33131
(Address of Principal Executive Offices)		(Zip Code)

(305) 579-8000

(Registrant’s Telephone Number, Including Area Code)

(Not Applicable)

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) ¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) ¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) ¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

Item 2.01 Completion of Acquisition or Disposition of Assets Item 2.04 Triggering Events that Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement Item 9.01 Financial Statements and Exhibits SIGNATURE Sec 906 Chief Executive Officer Certification Sec 906 Chief Financial Officer Certification Press Release

Item 2.01 Completion of Acquisition or Disposition of Assets

On February 16, 2005, New Valley Corporation (the “Company”) completed the sale to Princeton Owner Corp. (the “Purchaser”), an entity advised by Falcon Real Estate Investment Company, L.P., of its 100 and 150 College Road West office buildings (the “Office Buildings”) in Princeton, N.J. for an aggregate purchase price of $71.5 million. The properties were subject to a mortgage loan due in December 2006, of which approximately $39.2 million was outstanding as of December 31, 2004. The Company retired the mortgage at closing with the proceeds of the sale.

The sale of the office buildings was effectuated pursuant to a Sale-Purchase Agreement, dated as of December 23, 2004, between the Company and the Purchaser (the “Agreement”). The sale was negotiated on an arm’s length basis between the Company and the Purchaser. The Purchaser is not affiliated with the Company or any of its affiliates, or any director or officer of the Company, or any affiliate or associate of any such director or officer.

The summary of the foregoing transaction is qualified in its entirety by reference to the text of the Agreement, which is included as an exhibit hereto and incorporated herein by reference.

Item 2.04 Triggering Events that Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement

See Item 2.01, which is incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits

(b) Pro Forma Financial Information

On February 16, 2005, the Company consummated the sale to the Purchaser of the Office Buildings. The Unaudited Pro Forma Condensed Consolidated Statement of Operations for the years ended December 31, 2003 and 2002, respectively, and for the nine months ended September 30, 2004 and 2003, respectively, present the results of operations of the Company assuming the sale of the Office Buildings had been consummated as of December 31, 2001. The Unaudited Pro Forma Condensed Consolidated Statement of Operations for the year ended December 31, 2001 has not been presented because the Office Buildings were acquired on December 13, 2002. The Unaudited Pro Forma Condensed Consolidated Statements of Operations presented do not include the non-recurring gain associated with the sale of the Office Buildings.

The Unaudited Pro Forma Condensed Consolidated Balance Sheet as of September 30, 2004 reflects the assets, liabilities and stockholders’ equity of the Company after giving effect to the elimination of the assets and liabilities relating to the Office Buildings, the receipt of the sale proceeds and the required retirement of the mortgage note payable assuming the sale of the Office Buildings had been consummated on September 30, 2004.

The pro forma information does not purport to be indicative of the results of operations or the financial position which would have actually been obtained if the sale of the Office Buildings had been consummated as of the beginning of the periods presented or at September 30, 2004. In addition, the pro forma financial information does not purport to be indicative of results of operations or financial position which may be obtained in the future.

The pro forma financial information should be read in conjunction with the Company’s historical Consolidated Financial Statements and Notes thereto contained in the Company’s 2003 Annual Report on Form 10-K and the Quarterly Reports on Form 10-Q for the quarters ended March 31, 2004, June 30, 2004 and September 30, 2004.

NEW VALLEY CORPORATION AND SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (Dollars in Thousands, Except Per Share Amounts)

	September 30, 2004
	Pro Forma Adjustments
				Office
				Buildings
	Historical			Disposal			Pro Forma
ASSETS
Current assets:
Cash and cash equivalents	$	71,595		$	29,342	(B)		$	100,937
Investment securities available for sale		10,758			—				10,758
Restricted assets		577			(577	) (A)			—
Other current assets		893			(809	) (A)			84
Total current assets		83,823			27,956				111,779
Investments in real estate, net		52,116			(52,116	) (A)			—
Investments in non-consolidated real estate businesses		27,602			—				27,602
Restricted assets		176			(176	) (A)			—
Long-term investments, net		2,332			—				2,332
Note receivable		500			—				500
Other assets		308			(224	) (A)			84
Total assets	$	166,857		$	(24,560	)		$	142,297
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of mortgage note payable	$	644		$	(644	) (A)		$	—
Accounts payable and accrued liabilities		3,742			(618	) (A)			3,424
					300	(B)
Prepetition claims		600			—				600
Income taxes		11,379			300	(C)			11,679
Total current liabilities		16,365			(662	)			15,703
Mortgage note payable		38,730			(38,730	) (A)			—
Other long-term liabilities		2,609			(168	) (A)			2,441
Commitments and contingencies		—			—				—
Stockholders’ equity:
Common Shares, $.01 par value; 100,000,000 shares authorized; 22,082,036 shares outstanding		221			—				221
Additional paid-in capital		862,473			—				862,473
Accumulated deficit		(756,635	)		15,000	(D)			(741,635	)
Accumulated other comprehensive income		3,094			—				3,094
Total stockholders’ equity		109,153			15,000				124,153
Total liabilities and stockholders’ equity	$	166,857		$	(24,560	)		$	142,297

(A) To eliminate the operations of the Office Buildings. (B) To record the sale of the Office Buildings. (C) Represents the estimated alternative minimum income tax liability associated with the sale of the Office Buildings as if the sale had occurred on September 30, 2004. (D) Represents the estimated gain realized on the sale of the Office Buildings as if the sale had occurred on September 30, 2004.

NEW VALLEY CORPORATION AND SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Dollars in Thousands, Except Per Share Amounts)

	Nine Months Ended September 30, 2004
	Pro Forma Adjustments
				Office
				Buildings
	Historical			Disposal			Pro Forma
Revenues:
Real estate leasing	$	5,401		$	(5,401	)(A)		—
Total		5,401			(5,401	)		—
Cost and expenses:
General and administrative		8,898			—			8,898
Rental real estate activities		2,565			(2,565	) (A)		—
Total		11,463			(2,565	)		8,898
Other results from continuing operations:
Equity income from non-consolidated real estate businesses		9,827			—			9,827
Gain on sale of investments, net		5,613			—			5,613
Interest and dividend income		674			—			674
Interest expense		(1,093	)		1,093	(B)		—
Other loss		(12	)		—			(12	)
Total		15,009			1,093			16,102
Income from continuing operations before income taxes and minority interests		8,947			(1,743	)		7,204
Minority interests in loss from continuing operations of consolidated subsidiaries		(1	)		—			(1	)
Income tax provision		115			(34	) (C)		81
Income from continuing operations	$	8,833		$	(1,709	)	$	7,124
Income per Common Share (basic):
Income per Common Share from continuing operations	$	0.40		$	(0.08	)	$	0.32
Number of shares used in computation		22,114,213			—			22,114,213
Income per Common Share (diluted):
Income per Common Share from continuing operations	$	0.40		$	(0.08	)	$	0.32
Number of shares used in computation		22,120,215			—			22,120,215

(A) To eliminate the operations of the Office Buildings. (B) To eliminate the interest expense associated with the nonrecourse mortgage note payable retired in connection with the sale of the Office Buildings. (C) To eliminate portion of income tax provision associated with the operations of the Office Buildings.

NEW VALLEY CORPORATION AND SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Dollars in Thousands, Except Per Share Amounts)

	Nine Months Ended September 30, 2003
	Pro Forma Adjustments
				Office
				Buildings
	Historical			Disposal			Pro Forma
Revenues:
Real estate leasing	$	5,373		$	(5,373	)(A)		—
Total		5,373			(5,373	)		—
Cost and expenses:
General and administrative		8,349			—			8,349
Rental real estate activities		2,506			(2,506	) (A)		—
Total		10,855			(2,506	)		8,349
Other results from continuing operations:
Equity income from non-consolidated real estate businesses		636			—			636
Gain on sale of investments, net		606			—			606
Interest and dividend income		576			—			576
Interest expense		(1,079	)		1,079	(B)		—
Other loss		21			—			21
Total		760			1,079			1,839
Loss from continuing operations before minority interests		(4,722	)		(1,788	)		(6,510	)
Minority interests in loss from continuing operations of consolidated subsidiaries		(4	)		—			(4	)
Loss from continuing operations	$	(4,718	)	$	(1,788	)	$	(6,506	)
Loss per Common Share (basic and diluted):
Loss per Common Share from continuing operations	$	(0.21	)	$	(0.08	)	$	(0.29	)
Number of shares used in computation		22,155,528			—			22,155,528

NEW VALLEY CORPORATION AND SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Dollars in Thousands, Except Per Share Amounts)

	Year Ended December 31, 2003
	Pro Forma Adjustments
				Office
				Buildings
	Historical			Disposal			Pro Forma
Revenues:
Real estate leasing	$	7,298		$	(7,298	)(A)	$	—
Total		7,298			(7,298	)		—
Costs and expenses:
General and administrative		11,901			—			11,901
Rental real estate activities		3,531			(3,531	) (A)		—
Total		15,432			(3,531	)		11,901
Other results from continuing operations:
Equity income from non-consolidated real estate businesses		901			—			901
Gain on sale of real estate		478			—			478
Gain on sale of investments, net		1,654			—			1,654
Interest and dividend income		823			—			823
Interest expense		(1,421	)		1,421	(B)		—
Other income		17			—			17
Total		2,452			1,421			3,873
Loss from continuing operations before minority interests		(5,682	)		(2,346	)		(8,028	)
Minority interests in loss from continuing operations of consolidated subsidiaries		(20	)		—			(20	)
Loss from continuing operations	$	(5,662	)		(2,346	)	$	(8,008	)
Loss per Common Share (basic and diluted):
Loss per Common Share from continuing operations	$	(0.26	)	$	(0.10	)	$	(0.36	)
Number of shares used in computation		22,146,031			—			22,146,031

NEW VALLEY CORPORATION AND SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Dollars in Thousands, Except Per Share Amounts)

	Year Ended December 31, 2002
	Pro Forma Adjustments
				Office
				Buildings
	Historical			Disposal			Pro Forma
Revenues:
Real estate leasing	$	1,001		$	(340	)(A)	$	661
Total		1,001			(340	)		661
Costs and expenses:
General and administrative		12,967			—			12,967
Rental real estate activities		1,579			(155	) (A)		1,424
Total		14,546			(155	)		14,391
Other results from continuing operations:
Equity loss from non-consolidated real estate businesses		(749	)		—			(749	)
Gain on sale of real estate		9,048			—			9,048
Gain on sale of investments, net		1,850			—			1,850
Interest and dividend income		2,163			—			2,163
Interest expense		(483	)		72	(A)		(411	)
Provision for loss on net investment in subsidiary		(338	)		—			(338	)
Provision for uncollectibility of notes receivable		(13,198	)		—			(13,198	)
Provision for loss on investments		(6,776	)		—			(6,776	)
Other income		(35	)		—			(35	)
Total		(8,518	)		72			(8,446	)
Loss from continuing operations before minority interests		(22,063	)		(113	)		(22,176	)
Minority interests in loss from continuing operations of consolidated subsidiaries		(151	)		—			(151	)
Loss from continuing operations	$	(21,912	)		(113	)	$	(22,025	)
Loss per Common Share (basic and diluted):
Loss per Common Share from continuing operations	$	(0.96	)	$	(0.01	)	$	(0.97	)
Number of shares used in computation		22,757,296			—			22,757,296

(A) To eliminate the operations of the Office Buildings.

	10.1	Sale-Purchase Agreement, dated as of December 23, 2004, between New Valley Corporation and Princeton Owner Corp. (incorporated by reference to Exhibit 10.1 in the Company’s Current Report on Form 8-K dated December 23, 2004).
	32.1	Certification of Chief Executive Officer, Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	32.2	Certification of Chief Financial Officer, Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	99.1	Press Release, dated February 16, 2005.

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 hereunto duly authorized.

	NEW VALLEY CORPORATION
	/s/ J. Bryant Kirkland III
Date: February 17, 2005	J. Bryant Kirkland III
	Vice President, Treasurer and Chief Financial Officer

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