SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
SCHEDULE 14D-9
Solicitation/Recommendation Statement
Pursuant to Section 14(d)(4) of the
Securities Exchange Act of 1934
__________________
EMPIRE STATE BUILDING ASSOCIATES
(Name of Subject Company)
PETER L. MALKIN
on behalf of Empire State Building Associates
(Name of Person Filing Statement)
Participations In the Partnership Interests of the Partners
(Title of Class of Securities)
N/A
(CUSIP Number of Class of Securities)
_________________________
Peter L. Malkin
Wien & Malkin LLP
60 East 42nd Street
New York, New York 10165-0015
(212) 687-8700
(Name, Address, and Telephone Number of Person
Authorized to Receive Notices and Communications
on Behalf of the Person(s) filing Statement)
Copy to:
EDWARD BRODSKY, ESQ.
Proskauer Rose LLP
1585 Broadway
New York, New York 10036
(212) 969-3000
Unless otherwise indicated, all capitalized terms used but not
defined herein have the meanings set forth in the Schedule 14D-9.
Item 1. Security and Subject Company
The name of the subject partnership is Empire State Building
Associates, a New York general partnership ("Associates"), and the address of
its principal executive office is 60 East 42nd Street, New York, New York
10165. The title of the class of equity securities to which this statement
relates is participations ("Participations") in the partnership interests in
Associates held by the Partners (as defined below).
Item 2. Tender Offer of the Bidder
This statement relates to the unsolicited tender offer being made
by Empire State Liquidity Fund LLC, a Delaware limited liability company
("ESL" or the "Offeror"). The tender offer by ESL is an offer to purchase up
to 160 Participations at a purchase price of $22,500 per Participation. The
terms and conditions of the offer to purchase are set forth in a letter, dated
July 29, 1997. The letter and the form of Assignment and Transfer included
therewith (together, the "Offer") state the address of ESL as c/o MacKenzie
Partners, Inc., 156 Fifth Avenue, New York, New York 10010 (a copy of the
Offer is attached hereto as Exhibit A).
Item 3. Identity and Background
(a) The name and business address of the person filing this
statement is Peter L. Malkin on behalf of Associates, c/o Wien & Malkin LLP,
60 East 42nd Street, New York, New York 10165-0015.
(b)(i) Associates is a partnership which was organized on
July 11, 1961; it holds the tenant's interest in a master operating leasehold
upon the Empire State Building (the "Building") and of the land thereunder,
located at 350 Fifth Avenue, New York, New York (collectively, the
"Property"). Associates subleases the Building to Empire State Building
Company (the "Sublessee") pursuant to a net operating sublease (the
"Sublease") with a term and renewal options essentially coextensive with those
contained in the master lease.
Associates' partners are Peter L. Malkin, Stanley Katzman
and John L. Loehr (individually, a "Partner" and, collectively, the
"Partners"), each of whom also acts as an Agent for Participants in their
respective partnership interests in Associates.
Sublessee is a partnership in which Peter L. Malkin is a
partner. The Partners in Associates are also members of the law firm of Wien
& Malkin LLP, 60 East 42nd Street, New York, New York, which is supervisor
("Supervisor") to Associates and to Sublessee. The services provided to
Associates by Supervisor include administrative services and financial
services. Wien & Malkin LLP also serves as counsel to Associates. The
services include supervising the operation and management of the Building by
the exclusive managing and leasing agent, including marketing, rentals,
capital improvements and maintenance of the Building, performing physical
inspections of the Building, maintaining all of Associates' partnership
records, reviewing insurance coverage and preparing for and conducting annual
partnership meetings. Financial services include monthly receipt of rent from
the Sublessee, payment of mortgage charges, ground rents and real estate
taxes, payment of monthly and additional distributions, and active review of
financial statements audited by and tax information prepared by Associates'
independent certified public accountant, and distribution of such materials to
the Participants.
No remuneration was paid during the fiscal year ended
December 31, 1996 by Associates to any of the Partners as such. Associates
pays Supervisor for services and disbursements, fees of $100,000 per annum
plus 6% of all sums distributed to the Participants in excess of 9% per annum
on their original cash investment. Pursuant to such arrangements described
herein, Associates paid the Supervisor $159,417 for services rendered during
the fiscal year ended December 31, 1996. Services include, among other items,
the preparation of reports and related documentation required by the
Securities and Exchange Commission, the monitoring of all areas of federal and
local securities law compliance, the preparation of certain financial reports,
as well as the supervision of accounting and other documentation related to
the administration of Associates' business. Out of its fees, Supervisor paid
all disbursements and costs of regular accounting services.
As stated above, Mr. Peter L. Malkin, Mr. Stanley Katzman
and Mr. John L. Loehr are the three Partners of Associates and also act as
Agents for the Participants in their respective partnership interests. Mr.
Malkin is also a partner in Sublessee. As a consequence of one of the three
Partners being a partner in Sublessee and all three Partners being members of
Wien & Malkin LLP (which represents Associates and Sublessee), all as
disclosed in the original prospectus and repeatedly thereafter, certain
conflicts of interest may arise with respect to the management and
administration of the business of Associates. However, under the respective
participating agreements pursuant to which the Partners act as Agents for the
Participants, certain transactions require the prior consent from Participants
owning a specified interest under the agreement in order for the Agents to act
on their behalf. Such transactions include modifications and extensions of
the Sublease, or a sale or other disposition of the Property or substantially
all of Associates' other assets.
(b)(ii) Except as disclosed herein, to the best knowledge of Mr.
Malkin, there is no material agreement, arrangement, understanding, or any
actual or potential conflict of interest between (i) Mr. Malkin and Associates
and its affiliates or Agents or (ii) Mr. Malkin and ESL, its executive
officers, directors or affiliates. ESL has proceeded in this matter without
notice to Mr. Malkin or to Wien & Malkin LLP.
Item 4. The Solicitation or Recommendation
(a) Recommendation.
As Supervisor of Associates, Wien & Malkin LLP continues to
recommend to all holders of Participations ("Participants") that they retain
their participations as long term income producing investments as originally
intended when the investment was created in 1961.
(b) Background and Reasons for the Recommendation.
The recommendation described in Item 4(a) above is based on the
following information:
i. The principals of Offeror have not been disclosed.
ii. Among other things, the name used by Offeror and Offeror's
use of mailing labels that prominently display the initials of the Partners
and Agents in Associates have mislead several Participants to believe that
Offeror is affiliated with Supervisor; it is not.
iii. The Offer from ESL does not indicate the tax impact of a
sale of a Participation. As of June 30, 1997, the tax basis of a $10,000
Participation held by an original Participant was approximately $1,000. For
many (if not most) Participants, a sale could have significant tax impact.
This is an important matter which Participants should review with their tax
advisors.
iv. Most of the major improvement program at the Building is
substantially complete. Therefore, it is anticipated that the operating cash
profit of the Sublessee for 1997 and future years will improve, with the
likelihood that coverage rent will be payable by the Sublessee and extra
distributions will be received by Participants for 1997 in February 1998 and
thereafter annually in increasing amounts.
v. The lawsuit brought by Julien J. Studley against Associates,
the Agents and Wien & Malkin LLP has been dismissed. Mr. Studley has filed a
Notice of Appeal. If he pursues an appeal, the Agents and Wien & Malkin LLP
intend to oppose it. The litigation involving companies related to Donald J.
Trump remains pending with a trial expected in 1998. A successful conclusion
of that matter will eliminate extraordinary costs of litigation and further
enhance profits.
vi. The Offeror's materials state that its acceptance of and
payment for Participations will be conditioned upon confirmation by Associates
that transfers are effective. Associates and the Partners, as Agents for the
Participants, have had no contact with Offeror, have no knowledge concerning
its principals, and have not established any procedure to determine the
effectiveness of such transfers.
vii. It appears to Mr. Malkin that the future prospects for the
property and for distributions to Participants are very favorable.
Item 5. Persons Retained, Employed or to Be Compensated.
Neither Associates, nor Mr. Malkin nor any person acting on behalf
of Associates has employed, retained or compensated, or intends to employ,
retain or compensate, any person or class of persons to make solicitations or
recommendations to Participants on behalf of Associates or Mr. Malkin
concerning the Offer.
Item 6. Recent Transactions and Intent with Respect to Securities
(a) No transaction in the Participations have been effected
during the past 60 days by Associates or, to the knowledge
of Associates, by any Partner or any of Associates' current
or former Agents or affiliates.
(b) To the best knowledge of Associates, no Partner, Agent or
affiliate currently intends to tender pursuant to the
Offer any Participations beneficially owned by them.
Item 7. Certain Negotiations and Transactions by the Subject Company.
None.
Item 8. Additional Information to be Furnished
None.
Item 9. Material to be Filed as Exhibits
(a) Offer mailed to Participants by ESL dated July 29, 1997.
(b) Form of Letter mailed to Participants by Peter L. Malkin,
dated July 31, 1997.
(c) Form of Letter mailed to ESL by Peter L. Malkin, dated
August 1, 1997.
(d) Form of letter to be sent to ESL by Peter L. Malkin, dated
August 8, 1997.
(e) Form of letter to be mailed to Participants by Peter L.
Malkin, dated August 11, 1997.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete, and correct.
Dated: August 7, 1997
EMPIRE STATE BUILDING ASSOCIATES
By: /s/Peter L. Malkin
Name: Peter L. Malkin
Title: Partner
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