SCHEDULE 14A
(Rule 14a-101)
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act
of 1934
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as
permitted by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
METROPOLIS REALTY TRUST, INC.
...............................................................................
(Name of Registrant as Specified In Its Charter)
...............................................................................
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No Fee Required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
.........................................................................
2) Aggregate number of securities to which transaction applies:
.........................................................................
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
.........................................................................
4) Proposed maximum aggregate value of transaction:
.........................................................................
5) Total fee paid:
.........................................................................
/ / Fee paid previously by written preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
..........................................................................
2) Form Schedule or Registration Statement No.:
.........................................................................
3) Filing Party:
.........................................................................
4) Date Filed:
.........................................................................
762443.5
<PAGE>
METROPOLIS REALTY TRUST, INC.
c/o Victor Capital Group, L.P.
605 Third Avenue
26th Floor
New York, New York 10016
November 18,1998
Dear Stockholders:
You are cordially invited to attend the 1998 Annual Meeting of Stockholders
of Metropolis Realty Trust, Inc., to be held at 10:00 a.m., local time, on
Friday, December 18, 1998, at the law offices of Battle Fowler, LLP, 75 East
55th Street, New York, New York. The attached Notice of Annual Meeting and Proxy
Statement describe the matters to be acted upon at the meeting. I urge you to
review them carefully.
It is important that your shares be represented and voted at the meeting.
Whether or not you personally plan to attend the meeting, please take a few
moments now to sign, date and return your proxy in the enclosed postage-paid
envelope. This will not limit your right to vote in person should you wish to
attend the meeting. Regardless of the number of shares you own, your presence by
proxy is important to establish a quorum, and your vote is important for proper
corporate governance.
Thank you for your interest in Metropolis Realty Trust, Inc.
Sincerely,
/s/ Lee S. Neibart
--------------------------
Lee S. Neibart
President and Director
762443.5
<PAGE>
METROPOLIS REALTY TRUST, INC.
c/o Victor Capital Group, L.P.
605 Third Avenue
26th Floor
New York, New York 10016
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON DECEMBER 18, 1998
To the Stockholders of
Metropolis Realty Trust, Inc.:
NOTICE IS HEREBY GIVEN that the 1998 Annual Meeting of Stockholders
(the "Annual Meeting") of Metropolis Realty Trust, Inc., a Maryland corporation
(the "Company") will be held on Friday, December 18, 1998 at 10:00 a.m. local
time, at the law offices of Battle Fowler, LLP for the following purposes:
1. To consider and vote upon a proposal to elect one Class
I director and two Class II directors of the Company to serve on the
Board of Directors until the Annual Meeting of Stockholders in 2001
and until their successors are duly elected and qualify; and
2. To consider and vote upon a proposal to ratify the
selection of Deloitte & Touche L.L.P. as the independent auditors of
the Company for the fiscal year ending December 31, 1998; and
3. To transact such other business that may properly be
brought before the Annual Meeting and at any adjournments or
postponements thereof.
Any action may be taken on the foregoing matters at the Annual
Meeting on the date specified above, or on any date or dates to which, by
original or later adjournment, the Annual Meeting may be adjourned, or to which
the Annual Meeting may be postponed.
Only stockholders of the Company of record as of the close of
business on November 16, 1998 will be entitled to notice of and to vote at the
Annual Meeting and at any adjournment or postponement thereof.
You are requested to complete and sign the enclosed form of proxy,
which is being solicited by the Board of Directors, and to mail it promptly in
the enclosed postage-prepaid envelope. Any proxy may be revoked by delivery of a
later dated proxy. Stockholders of record who attend the Annual Meeting may vote
in person, even if they have previously delivered a signed proxy.
By Order of the Board of Directors,
/s/John Jacobson
- -----------------------
John Jacobsson
Secretary
New York, New York
November 18, 1998
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE COMPLETE, SIGN,
DATE AND PROMPTLY RETURN THE ENCLOSED PROXY CARD IN THE POSTAGE-PREPAID ENVELOPE
PROVIDED. IF YOU ATTEND THE ANNUAL MEETING, YOU MAY VOTE IN PERSON IF YOU WISH,
EVEN IF YOU HAVE PREVIOUSLY RETURNED YOUR PROXY CARD.
762443.5
<PAGE>
METROPOLIS REALTY TRUST, INC.
c/o Victor Capital Group, L.P.
605 Third Avenue
26th Floor
New York, New York 10016
PROXY STATEMENT
FOR 1998 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON DECEMBER 18, 1998
November 18, 1998
This Proxy Statement is furnished in connection with the solicitation
of proxies by the Board of Directors of Metropolis Realty Trust, Inc., a
Maryland corporation (the "Company") for use at the 1998 Annual Meeting of
Stockholders of the Company to be held on Friday, December 18, 1998, at 10:00
a.m. local time and at any adjournment or postponement thereof (the "Annual
Meeting"). At the Annual Meeting, stockholders will be asked to consider and
vote upon a proposal (1) to elect one Class I director and two Class II
directors of the Company, (2) to ratify the selection of Deloitte & Touche
L.L.P. as the independent auditors of the Company for the fiscal year ending
December 31, 1998, and (3) to act upon any other matter properly brought before
the Annual Meeting or any adjournment or postponement thereof.
This Proxy Statement and the accompanying Notice of Annual Meeting
and Proxy Card are first being sent to stockholders on or about November 18,
1998. The Board of Directors has fixed the close of business on November 16,
1998 as the record date for the determination of stockholders entitled to notice
of and to vote at the Annual Meeting (the "Record Date"). Only stockholders of
record of the Company's common stock, $10.00 par value per share (the "Common
Stock"), at the close of business on the Record Date will be entitled to notice
of and to vote at the Annual Meeting. For the election of the Class I director,
only stockholders of record of the Company's Class B Common Stock at the close
of business on the Record Date will be entitled to notice of and to vote at the
Annual Meeting. For the election of Class II directors, stockholders of record
of the Company's Class A Common Stock and Class B Common Stock at the close of
business on the Record Date, voting as a single class will be entitled to notice
of and to vote at the Annual Meeting. As of the Record Date, there were
12,966,646 shares of Common Stock outstanding and entitled to vote at the Annual
Meeting. Holders of Common Stock outstanding as of the close of business on the
Record Date will be entitled to one vote for each share held by them.
The presence, in person or by proxy, of holders of at least a
majority of the total number of outstanding shares of Common Stock entitled to
vote is necessary to constitute a quorum for the transaction of business at the
Annual Meeting. The affirmative vote of a plurality of all of the votes cast at
the Annual Meeting (or, prior to the occurrence of a Simplification Event (as
defined in the Charter of the Company), a plurality of the votes of a particular
class of stock entitled to elect a director), provided that a quorum is present,
is required for the election of directors. For purposes of the election of
directors, abstentions will not be counted as votes cast and will have no effect
on the result of the vote. The affirmative vote of a majority of all of the
votes cast at the Annual Meeting (provided that a quorum is present) is
necessary to approve the proposal to ratify the selection of the Company's
auditors and to approve any other matters properly presented at the Annual
Meeting. For purposes of the vote on the ratification of the selection of the
Company's auditors, abstentions will not be counted as votes cast and will have
no effect on the result of the vote. Under Maryland law, abstentions and broker
non-votes are counted for purposes of determining the presence or absence of a
quorum at the Annual Meeting.
762443.5
<PAGE>
Stockholders of the Company are requested to complete, sign, date and
promptly return the accompanying Proxy Card in the enclosed postage-prepaid
envelope. Shares of Common Stock represented by a properly executed proxy
received prior to the vote at the Annual Meeting and not revoked will be voted
at the Annual Meeting as directed on the proxy. If a properly executed proxy is
submitted and no instructions are given, the proxy will be voted FOR the
election of the nominees for the Class I and Class II directors of the Company
named in this Proxy Statement, and FOR ratification of the Board of Directors'
selection of Deloitte & Touche L.L.P. as the Company's independent auditors for
the fiscal year ending December 31, 1998. It is not anticipated that any matters
other than those set forth in the Proxy Statement will be presented at the
Annual Meeting. If any other matter is presented, proxies will be voted in
accordance with the discretion of the proxy holders.
A stockholder of record may revoke a proxy at any time before it has
been exercised by filing a written revocation with the Secretary of the Company
at the address of the Company set forth above, by filing a duly executed proxy
bearing a later date, or by appearing in person and voting by ballot at the
Annual Meeting. Any stockholder of record as of the Record Date attending the
Annual Meeting may vote in person, whether or not a proxy has been previously
given, but the presence (without further action) of a stockholder at the Annual
Meeting will not constitute revocation of a previously given proxy. Any
instrument of revocation should be sent to Metropolis Realty Trust, Inc. c/o
Victor Capital Group, L.P., 605 Third Avenue, 26th Floor, New York, New York
10016, Attention: Secretary
The Company's 1997 Annual Report on Form 10-K (the "Annual Report"),
and the Company's Quarterly Report on Form 10-Q for the quarter ending September
30, 1998 (the "Quarterly Report"), are being mailed to stockholders concurrently
with this Proxy Statement. The Annual Report and the Quarterly Report, however,
are not part of the proxy solicitation material. Additional copies of the Annual
Report for the year ended December 31, 1997, and the Quarterly Report may be
obtained, without charge, by writing to the Company at the address above.
PROPOSAL 1: ELECTION OF DIRECTORS
The Board of Directors of the Company consists of nine directors who
are divided into five classes. The initial term of the first class expired in
1997; the initial terms of the second, third, fourth and fifth classes will
expire in 1998, 1999, 2000 and 2001 respectively. As the term of each class
expires, directors in that class will be elected by the stockholders of the
Company for a term of years which will expire in 2001, after which time all five
classes of directors will be elected for one year terms. Lee S. Neibart, the
Class I director, continues to serve as a director pursuant to Section 2-405(a)
of The Maryland General Corporation Law, which states that if directors are not
elected "at the designated time", such directors automatically hold over "until
their successors are elected and qualify".
At the Annual Meeting, one Class I director and two Class II
directors will be elected to serve on the Board of Directors until the Annual
Meeting of Stockholders in 2001 or until their successors are duly elected and
qualify or until their earlier death, resignation or removal. The Board of
Directors has nominated Lee S. Neibart to serve as the Class I director of the
Company, to be voted on by all Class B stockholders of record as of the Record
Date, and Bruce Spector and David Roberts to serve as the Class II directors, to
be voted on by all Class A and Class B stockholders of record as of the Record
Date. Mr. Neibart is currently serving as a Class I director and Mr. Spector and
Mr. Roberts are both currently serving as Class II directors of the Company. The
Board of Directors anticipates that Mr. Neibart, Mr. Spector and Mr. Roberts
will all serve, if elected, as directors of the Company. However, if Mr.
Neibart, Mr. Spector or Mr. Roberts are unable to accept election, the proxies
will be voted for the election of such other person or persons as the Board of
Directors may recommend.
The following discussion sets forth the names, ages and business
histories of the nominees for Class I and Class II director and the six
directors whose terms will continue after the Annual Meeting, and the year of
the annual meeting of stockholders at which each director's term will expire
(assuming, in the case of the nominees, that they are elected). All of the
following directors were initially elected or appointed as directors in 1996,
with the exception of John R. Jacobsson, who was elected in September 1997 by
the Class B stockholders.
762443.5
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<PAGE>
Information Regarding Nominees and Directors
Nominee for Election at 1998 Annual Meeting (Term to Expire in 2001)
Lee S. Neibart (age 48) is a partner of Apollo Real Estate Advisors,
L.P., with which he has been associated since 1993, and directs portfolio and
asset management. From 1979 to 1993, he was Executive Vice President and Chief
Operating Officer of the Robert Martin Company, a private real estate
development and management firm. Mr. Neibart is a director of Atlantic Gulf
Communities Corp., a land development company, Koger Equity, Inc., NextHealth,
Inc., an owner and operator of spa and wellness facilities, and Roland
International Corporation, a land development company. Mr. Neibart received a BA
from the University of Wisconsin and an MBA from New York University.
Nominee for Election at 1998 Annual Meeting (Term to Expire in 2001)
Bruce H. Spector (age 56) is a partner of Apollo Real Estate
Advisors, L.P., with which he has been associated since 1993 and has been
responsible for advising on matters of reorganization strategy. From 1967 to
1992, Mr. Spector was a member of the law firm of Stutman, Treister and Glatt,
spending a substantial amount of that time as a senior partner and head of the
firm's executive committee. Mr. Spector is a director of NextHealth, Inc.,
Telemundo Station Group, Inc., a national Spanish-language oriented television
producer, United International Holding, Inc., a designer and owner of cable and
telephone systems outside of North America, and Vail Resorts, Inc. Mr. Spector
received a B.A. from the University of Southern California and a J.D. from the
UCLA School of Law.
Nominee for Election at 1998 Annual Meeting (Term to Expire in 2001)
David Roberts (age 36) has been a Managing Director of Angelo, Gordon
& Co., L.P. ("Angelo, Gordon") an investment management firm, since 1993, where
he oversees the firm's real estate and special situations investment activities.
From 1988 until 1993, Mr. Roberts was a principal of Gordon Investment
Corporation, a Canadian merchant bank, where he participated in a wide variety
of principal transactions including investments in the real estate and mortgage
banking industries. Prior to that, Mr. Roberts worked in the Corporate Finance
Department of L.F. Rothschild & Co. Incorporated, an investment bank, as a
Senior Vice President specializing in mergers and acquisitions. Mr. Roberts has
a B.S. in Economics from the Wharton School of Business and Finance of the
University of Pennsylvania.
Recommendation of the Board of Directors
The Board of Directors of the Company recommends a vote FOR Lee S.
Neibart as Class I director of the Company and Bruce Spector and David Roberts
as Class II directors of the Company to hold office until the Annual Meeting of
Stockholders in 2001 and until their successors are duly elected and qualify.
Proxies received by the Board of Directors will be so voted unless stockholders
specify a contrary choice in their proxy.
Continuing Class III Directors (Term to Expire in 1999)
John R. Jacobsson (age 30) is a partner of Apollo Real Estate
Advisors, L.P. with which he has been associated since 1993 and is responsible
for investments. Prior to 1993, Mr. Jacobsson was associated with the
762443.5
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<PAGE>
acquisitions group of Trammell Crow Ventures, a real estate investment firm. Mr.
Jacobsson is a director of Koger Equity, Inc. and Roland International
Corporation. Mr. Jacobsson received a B.A. from Harvard College in 1990.
David A. Strumwasser (age 46) is a principal of Whippoorwill
Associates, Incorporated ("Whippoorwill"), an investment management firm, and
has served as a Managing Director and General Counsel of Whippoorwill since
1993. From 1984 to 1993, Mr. Strumwasser was a Partner and co-head of the
Bankruptcy and Reorganization Practice at the New York law firm of Berlack,
Israels & Liberman LLP. Prior to that, he practiced bankruptcy law at Anderson
Kill & Olick, LLP, from 1981 to 1984, and at Weil, Gotshal & Manges LLP, from
1976 to 1979. From 1979 to 1981, Mr. Strumwasser was an Assistant Vice President
at Citicorp Industrial Credit, Inc. Mr. Strumwasser received a B.A. in political
science from the State University of New York at Buffalo in 1973, and a J.D.
from Boston College Law School in 1976.
Continuing Class IV Directors (Term to Expire in 2000)
William L. Mack (age 58) is the managing partner of Apollo Real
Estate Advisors, L.P.("AREA"), the manager of three opportunistic real estate
investment funds, which he founded in 1993 and serves as President of its
corporate general partner. Beginning in 1969, Mr. Mack served as Managing
Partner of the Mack Company, where he oversaw the dynamic growth of the Mack
Company's office, industrial, retail and hotel facilities. Mr. Mack has served
as a director of Mack-Cali Realty Corporation since the 1997 merger of the Mack
Company's office portfolio into Mack-Cali. Mr. Mack is also a director of The
Bear Stearns Companies, Inc., an investment banking firm, Koger Equity, Inc., a
REIT which owns and operates suburban office parks in the Southeast and the
Southwest, Vail Resorts, Inc., an owner and operator of Colorado ski resorts.
Mr. Mack attended the Wharton School of Business and Finance at the University
of Pennsylvania and received a B.S. degree in business administration, finance
and real estate from New York University.
Ralph F. Rosenberg (age 34) has been a Vice President in the Merchant
Banking Division at Goldman, Sachs & Co. since August of 1998 and previous to
that he was a Vice President in the Investment Banking Division at Goldman,
Sachs & Co. since 1994. Prior to that he was an Associate in the Real Estate
Principal Investment Area from 1992 to 1994, and he served as an Associate in
the Real Estate Department from 1990 to 1992. Mr. Rosenberg was a Financial
Analyst at Goldman, Sachs & Co. from 1986 until 1988. Mr. Rosenberg is a
director of Cadillac Fairview Corporation and Rockefeller Center Properties,
Inc. He received a B.A. from Brown University in 1986, and an M.B.A. from the
Stanford Graduate School of Business in 1990.
Continuing Class V Directors (Term to Expire in 2001)
Russel S. Bernard (age 40) is a principal of Oaktree Capital
Management, LLC ("Oaktree"), with which he has been involved since 1995, and is
the portfolio manager of Oaktree's real estate and mortgage funds. Prior to
joining Oaktree in 1995, Mr. Bernard was a Managing Director of Trust Company of
the West (TCW). Under subadvisory relationships with Oaktree, Mr. Bernard
continues to serve as portfolio manager for the TCW Special Credits distressed
mortgage funds. From 1986 to 1994, Mr. Bernard was a partner in Win Properties,
Inc., a national real estate investment company, where he was responsible for
the acquisition, financing and operation of a national real estate portfolio.
Mr. Bernard is a director of Cadillac Fairview Corporation, which owns, manages
and develops shopping centers and office and mixed use properties in the U.S.
and Canada. Mr. Bernard holds a B.S. in Business Management and Marketing from
Cornell University.
John R. Klopp (age 44) is a Trustee, the Chief Executive Officer and
a Vice Chairman of Capital Trust, a specialty finance company focused on the
commercial real estate industry. Mr. Klopp is a founder and has been a Managing
Partner of Victor Capital Group ("VCG") since 1989. VCG is presently a
subsidiary of Capital Trust. From 1982 to 1989, Mr. Klopp was a Managing
Director and co-head of Chemical Realty Corporation ("Chemical Realty"), the
real estate investment banking affiliate of Chemical Bank. Prior to founding
Chemical Realty, he held various positions in Chemical Bank's Real Estate
Division and was responsible for originating, closing and monitoring portfolios
of construction and interim loans. He received a B.A. from Tufts University in
1976 with a major in economics, and an M.B.A. in 1978 from the Wharton School of
Business and Finance at the University of Pennsylvania with a major in real
estate and finance.
762443.5
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<PAGE>
Executive Officers
The following discussion sets forth the names, ages and business
histories of the executive officers of the Company. Each of the following
individuals has served as an executive officer of the Company since 1996, with
the exception of Andrew Cohen who has served since 1997, and it is anticipated
that each will be re-elected and continue to serve in their respective
positions.
<TABLE>
<CAPTION>
Name Age Office Business History
<S> <C> <C> <C>
William L. Mack 58 Chairman of the Board See above biography.
Lee S. Neibart 48 President See above biography.
John R. Klopp 44 Vice President See above biography.
John R. Jacobsson 30 Vice President See above biography.
Secretary
Stuart F. Koenig 46 Treasurer Mr. Koenig has been associated with Apollo Real
Estate Advisors, L.P. since 1995 and is its Chief
Financial Officer. Prior to that time, Mr. Koenig was
a Vice President in the Real Estate Principal
Investment Area of Goldman, Sachs & Co., where he
served as Controller and Director of Investor Relations
for the Whitehall real estate investment funds. Mr.
Koenig received a BA in English from the State
University of New York at Binghamton and an MBA
in Accounting from the Bernard M. Baruch College of
the City University of New York.
Andrew S. Cohen 37 Vice President Mr. Cohen has been associated with Apollo Real
Estate Advisors, L.P. since 1996 and is responsible for
asset management, including leasing, financing and
dispositions. From 1987 to 1996, Mr. Cohen was with
Park Tower Realty Corp., a New York based
development company, where he was most recently a
Senior Vice President responsible for finance and asset
management. Mr. Cohen received a B.A. from Brown
University and an MBA from Columbia Business
School.
Jeremy FitzGerald 35 Assistant Secretary Ms. FitzGerald has been a managing director of
Capital Trust since July 1997. Prior to that time, Ms.
FitzGerald served as a principal of Victor Capital and
had been employed in various positions at such firm
since May 1990. She was previously employed in
various positions at PaineWebber Incorporated. Ms.
FitzGerald holds a B.A. from the University of
Virginia and a Masters in Business Administration
from Columbia Business School.
</TABLE>
762443.5
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<PAGE>
RELATED PARTY TRANSACTIONS
The following represent all related party transactions as of
September 30, 1998, as reported on the Company's Form 10-Q for the quarter then
ended.
Asset Management - The Company has entered into an Asset Management
Agreement with a company (The "Asset Manager") which is directly affiliated with
John R. Klopp. One of these stockholders is also a Director and Officer of the
Company. The Asset Manager provides asset advisory, consultation and management
services for the Company. Fees for such services are payable at a rate of
$25,000 per month, in arrears. The Asset Management Agreement also provides for
reimbursement of costs and expenses for contractors and professionals, as
incurred. Asset management fees incurred for each of three and nine months ended
September 30, 1998 and 1997 aggregated approximately $75,000 and $225,000
respectively.
Property Management - The Company has entered into a Management and
Leasing Agreement with Tishman Speyer Properties, L.P. or its affiliates (The
"Property Manager/Leasing Agent") which is an affiliate of a stockholder. The
Property Manager/Leasing Agent manages and operates the property and provides
all supervisory, management and leasing services. The Management and Leasing
Agreement provides for a fee of 1.5% of Gross Revenues, payable monthly and
reimbursement for overhead and all reasonable out-of-pocket-expenses incurred.
The Management and Leasing Agreement also provides for leasing commissions to be
calculated on a sliding scale percentage basis of a lease's base rent. Fees
incurred under the Management and Leasing Agreement for the three and nine
months ended September 30, 1998 aggregated approximately $837,000 and
$2,176,000, respectively. Fees incurred for the three and nine months ended
September 30, 1997 aggregated approximately $432,000 and $1,670,000,
respectively.
An affiliate of the Property Manager/Leasing Agent provides cleaning services
for the Properties. Fees paid for cleaning services for the three and nine
months ended September 30, 1998 totaled $1,002,000 and $3,036,000 respectively.
Fees paid for the three and nine months ended September 30, 1997 totaled
$964,000 and $3,232,000, respectively.
REIT Management - The Company has entered into a REIT Management
Agreement with the Property Manager/Leasing Agent ("REIT Manager"). The REIT
Manager performs certain accounting, administrative and monitoring services. The
REIT Management Agreement provides for compensation to the REIT Manager of a
monthly fee and reimbursement of documented out-of-pocket expenses. Fees
incurred under the REIT Management Agreement for the three and nine months ended
September 30, 1998 aggregated $31,000 and $110,000, respectively. Fees incurred
for the three and nine months ended September 30, 1997 aggregated $31,000 and
$109,000, respectively.
EXECUTIVE COMPENSATION
The Company has no employees. The officers of the Company will not
receive any compensation from the Company or any of its subsidiaries, other than
any compensation they may receive as directors. The members of the Board of
Directors each receive as an annual retainer (i) $10,000 which will be paid in
cash, and (ii) 400 shares of Common Stock to be issued under the Metropolis
Realty Trust, Inc. 1996 Directors' Stock Plan effective October 10, 1996 (the
"Stock Plan"). Such cash and stock will be paid to the current Board of
Directors at the time of the 1998 Annual Meeting of Stockholders. Each director
receives an additional payment of $750 for each Board meeting attended. Upon
election to the Board of Directors, each initial director received options to
purchase 3,000 shares of the Company's Common Stock all of which have vested and
are exercisable at $25.00 per share. In March 1998, John Jacobsson, a new
director, was granted 400 shares of Common Stock and options entitling him to
purchase an aggregate of 3,000 shares of Common Stock at an exercise price of
$42.50 per share. Of such options, 2,000 are currently exercisable and 1,000
become exercisable on October 10, 1999. See "SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT".
The Company has purchased a directors' and officers' liability
insurance policy in the amount of $10,000,000.
762443.5
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<PAGE>
BOARD OF DIRECTORS MEETINGS
The business of the Company is conducted under the general management
of its Board of Directors as required by the Company's By-laws and the laws of
Maryland. There are presently nine directors. During the year ended December 31,
1997, the Board of Directors held ten meetings. All of the directors attended at
least 75% of the total number of meetings of the Board of Directors.
STOCK PERFORMANCE GRAPH
The Registrant's securities do not actively trade, and are not traded
on any exchange or included for quotation on any automated quotation system.
Therefore, the Company's securities do not have a fair market value that can be
readily determined for comparison to either a broad equity market index or an
industry index.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth as of November 9, 1998, certain
information regarding the beneficial ownership of shares of Common Stock by (i)
each director of the Company, (ii) each executive officer of the Company, (iii)
by all directors and executive officers of the Company as a group and (iv) by
persons who own more than 5.0% of the shares of Common Stock. Except as
otherwise described below, all shares of Common Stock are owned directly and the
indicated person has sole voting and investment power.
<TABLE>
<CAPTION>
Number of Shares Percent of Common
Name and Address of Beneficial Owner Beneficially Owned Stock
<S> <C> <C>
Principal Stockholders
Apollo Real Estate Investment Fund, L.P. (1) 4,936,060 38.1%
The TCW Group, Inc.(2) 2,254,341 17.4%
Oaktree Capital Management, LLC (3) 1,913,263 14.8%
Whitehall Street Real Estate, Limited Partnership V (4) 1,122,821 8.7%
Angelo, Gordon & Co., L.P. (5) 818,739 6.3%
Intermarket Corp. (6) 890,862 6.9%
Directors and Executive Officers
William L. Mack (7) 3,400 *
Lee S. Neibart (8) 3,400 *
John R. Jacobsson (9) 2,400 *
Bruce H. Spector (10) 3,400 *
John R. Klopp (11) 23,400 *
Russel S. Bernard (12) 3,000 *
Ralph F. Rosenberg (13) 3,000 *
David A. Strumwasser (14) 3,400 *
David Roberts (15) 3,000 *
------
Directors and Executive Officers as a group (9 persons) (16) 48,400 *
======
* Less than 1%
</TABLE>
(1) Held of record by Atwell & Co., c/o The Chase Manhattan Bank, N.A., 4
New York Plaza, New York, NY 10004.
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(2) Includes 1,586,814 shares as to which voting and dispositive power is
shared with Oaktree Capital Management, LLC ("Oaktree"), as an
investment sub-adviser to TCW Asset Management Company. Also includes
667,527 shares held by various limited partnerships, trusts and third
party accounts for which TCW Special Credits acts as general partner
or investment manager. The shares shown are held of record by (i)
Taylor & Co., c/o Sanwa Bank California Trust Operations, 1977 Saturn
Street, Montrerey Park, CA 91754 (1,848,248 shares), and (ii) Salkeld
& Co., c/o Bankers Trust Company, 14 Wall Street, New York, NY 10015
(406,093 shares)
(3) Includes 1,586,814 shares as to which voting and dispositive power is
shared with TCW Asset Management Company, which acts as general
partner or investment manager for certain funds and accounts for
which Oaktree acts as an investment sub-adviser. Also includes
284,839 shares held by certain limited partnerships of which Oaktree
is general partner and 41,210 shares held by a third party account
for which Oaktree acts as investment manager. The 176,049 shares as
to which Oaktree has sole voting and dispositive power are held of
record by Cun & Co., c/o The Bank of New York, One Wall Street, New
York, NY 10005. Also includes 400 shares held directly by Oaktree
Capital Management, LLC.
(4) Held of record by WSB Realty LLC, (1,122,421 shares) and The Goldman
Sachs Group, L.P. (400 shares) 85 Broad Street, New York, NY 10004.
(5) Angelo, Gordon & Co., L.P.'s address is 245 Park Avenue, New York, NY
10167.
(6) Intermarket Corp.'s address is 667 Madison Avenue, New York, NY
10021.
(7) Does not include shares owned by Apollo. Includes 400 shares of
Common Stock and 3,000 shares of Common Stock issuable pursuant to
the options granted to Mr. Mack under the Stock Plan that were
exercisable as of November 9, 1998. Mr. Mack is a the managing
partner of Apollo Real Estate Advisors, L.P., the general partner of
Apollo, and the President of its corporate general partner. Mr. Mack
disclaims beneficial ownership of the shares of Common Stock owned by
Apollo.
(8) Does not include shares owned by Apollo. Includes 400 shares of
Common Stock and 3,000 shares of Common Stock issuable pursuant to
the options granted to Mr. Neibart under the Stock Plan that were
exercisable as of November 9, 1998. Mr. Neibart is a partner of
Apollo Real Estate Advisors, L.P. Mr. Neibart disclaims beneficial
ownership of the shares of Common Stock owned by Apollo.
(9) Includes 400 shares issued to Mr. Jacobsson in 1998 pursuant to the
Stock Plan and options to acquire 2,000 shares of the Company that
were issued to Mr. Jacobsson in 1998 pursuant to the Stock Plan that
were exercisable as of November 9, 1998. Does not include shares
owned by Apollo. Mr. Jacobsson is a partner of Apollo Real Estate
Advisors, L.P. Mr. Jacobsson disclaims beneficial ownership of the
Common Stock owned by Apollo.
(10) Does not include shares owned by Apollo. Includes 400 shares of
Common Stock and 3,000 shares of Common Stock issuable pursuant to
the options granted to Mr. Spector under the Stock Plan that were
exercisable as of November 9, 1998. Mr. Spector is a partner of
Apollo Real Estate Advisors, L.P. Mr. Spector disclaims beneficial
ownership of the shares of Common Stock owned by Apollo.
(11) Includes 20,400 shares of Common Stock and 3,000 shares of Common
Stock issuable pursuant to the options granted to Mr. Klopp under the
Stock Plan that were exercisable as of November 9, 1998.
(12) Does not include shares owned by funds and accounts managed by
Oaktree. Includes 3,000 shares of Common Stock issuable pursuant to
the options granted to Mr. Bernard under the Stock Plan that were
exercisable as of November 9, 1998. Mr. Bernard is a principal of
Oaktree. Mr. Bernard disclaims beneficial ownership of the shares of
Common Stock owned by funds and accounts managed by Oaktree. Mr.
Bernard is required to transfer to funds managed by Oaktree any
shares of Common Stock he either receives directly under the
Company's Stock Plan or purchases upon an exercise of options granted
under the Company's Stock Plan.
(13) Does not include shares owned by Whitehall. Includes 3,000 shares of
Common Stock issuable pursuant to the options granted to Mr.
Rosenberg under the Stock Plan that were exercisable as of November
9, 1998. Mr. Rosenberg disclaims beneficial ownership of the shares
of Common Stock owned by Whitehall. Mr. Rosenberg is a Vice President
of Goldman, Sachs & Co. Pursuant to Mr. Rosenberg's employment
arrangements with Goldman Sachs, Mr. Rosenberg is required to
transfer to Goldman Sachs any shares of Common Stock he receives
either directly under the Company's Stock Plan or purchases upon an
exercise of options granted under the Company's Stock Plan.
(14) Does not include 314,024 shares held by various limited partnerships,
trusts and third party accounts for which Whippoorwill Associates,
Inc. has discretionary authority and acts as general partner or
investment manager. Includes 400 shares of Common Stock and 3,000
shares of Common Stock issuable pursuant to the options granted to
Mr. Strumwasser under the Stock Plan that were exercisable as of
November 9, 1998. Mr. Strumwasser is a principal of and Managing
Director and General Counsel of Whippoorwill Associates. Mr.
Strumwasser disclaims beneficial ownership of the shares of Common
Stock owned by discretionary accounts managed by Whippoorwill
Associates as set forth above.
(15) Does not include shares owned by Angelo, Gordon. Includes 3,000
shares of Common Stock issuable pursuant to the options granted to
Mr. Roberts under the Stock Plan that were exercisable as of November
9, 1998. Mr. Roberts is a Managing Director of Angelo, Gordon. Mr.
Roberts disclaims beneficial ownership of the shares of Common Stock
owned by Angelo, Gordon.
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(16) See notes 1 through 15 above with respect to the nature of the
ownership of Directors and Executive Officers as a group, including
disclaimers of beneficial ownership described therein.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's executive officers and directors, and persons who beneficially own
more than 10% of a registered class of the Company's equity securities ("10%
Holders"), to file reports of ownership and changes in ownership with the
Commission. Officers, directors and 10% Holders are required by the Commission's
regulations to furnish the Company with copies of all Section 16(a) forms that
they file. To the Company's knowledge, based solely on review of the copies of
such reports furnished to the Company, all Section 16(a) filing requirements
applicable to its executive officers, directors and 10% Holders were properly
and timely satisfied.
PROPOSAL 2: RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
The Board of Directors of the Company has selected the accounting
firm of Deloitte & Touche L.L.P. to serve as independent auditors of the Company
for the fiscal year ending December 31, 1998. Deloitte & Touche L.L.P. has
served as the Company's independent auditors since the Company's formation in
1996 and is considered by management of the Company to be well qualified. The
Company has been advised by that firm that neither it nor any member thereof has
any financial interest, direct or indirect, in the Company or any of its
subsidiaries in any capacity. A representative of Deloitte & Touche L.L.P. will
be present at the Annual Meeting, will be given the opportunity to make a
statement if he or she so desires and will be available to respond to
appropriate questions.
Although the Company is not required to submit the ratification of
the selection of its independent auditors to a vote of stockholders, the Board
of Directors believes that it is a sound policy to do so. If the majority of the
votes cast are against the selection of Deloitte & Touche L.L.P., the directors
will consider the vote and the reasons therefor in future decisions on the
selection of independent auditors.
Recommendation of the Board of Directors
The Board of Directors recommends a vote FOR the proposal to ratify
the selection of Deloitte & Touche L.L.P. as independent auditors of the Company
for the fiscal year ending December 31, 1998.
SOLICITATION OF PROXIES
The accompanying form of proxy is being solicited on behalf of the
Board of Directors of the Company. The expenses of solicitation of proxies for
the Annual Meeting will be paid by the Company. In addition to the mailing of
the proxy material, such solicitation may be made in person or by telephone by
officers of the Company, who will receive no additional compensation therefor.
The Company has retained Continental Stock Transfer and Trust Company to assist
with the mailing of this proxy statement and related materials. Upon request,
the Company will reimburse brokers, dealers, banks and trustees, or their
nominees, for reasonable expenses incurred by them in forwarding material to
beneficial owners of shares of Common Stock of the Company.
STOCKHOLDER PROPOSALS
The Board of Directors will provide for the presentation of proposals
by the Company's stockholders at its annual meeting of stockholders for 1999,
provided that such proposals are submitted by eligible stockholders who have
complied with the relevant regulations of the Commission regarding stockholder
proposals and the Company's By-Laws, a copy of which is available upon written
request from the Secretary of the Company. Stockholder proposals intended to be
submitted for presentation at the Company's annual meeting of stockholders
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for 1999 must be in writing and must be received by the Company at its executive
offices on or before May 15, 1999 for inclusion in the Company's proxy statement
and the form of proxy relating to the 1999 annual meeting. Any such proposal
should be mailed to: Metropolis Realty Trust, Inc. c/o Victor Capital Group,
L.P., 605 Third Avenue, 26th Floor, New York, New York 10016, Attention:
Secretary.
OTHER MATTERS
The Board of Directors does not know of any matters other than those
described in this Proxy Statement that will be presented for action at the
Annual Meeting. If other matters are presented, proxies will be voted in
accordance with the best judgment of the proxy holders.
BY ORDER OF THE BOARD OF DIRECTORS
/s/John Jacobson
- ---------------------
John Jacobsson
Secretary
New York, New York
November 18,1998
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