SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
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....................Nooney Real Property Investors-Four, L.P....................
(Name of Registrant as Specified In Its Charter)
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876651.1
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NOONEY REAL PROPERTY INVESTORS-FOUR, L.P.
One Memorial Drive, Suite 1000
St. Louis, Missouri 63102-2124
(314) 206-4600
September 23, 1999
Re: Consent Solicitation for Nooney Real Property Investors-Four,
L.P. (the "Partnership")
-------------------------------------------------------------
Dear Investor:
This letter is being sent to you on behalf of the Partnership by
Nooney Capital Corp., its Managing General Partner.
We have become aware that you and other Limited Partners of the
Partnership may have received an unsolicited consent solicitation (the "Consent
Solicitation") from Millenium Investors 2, LLC ("Millenium") seeking your
approval of the following proposals: (i) the removal of the Partnership's
current general partners; (ii) the election of Millenium as the new general
partner of the Partnership; and (iii) the dissolution of the Partnership and the
final distribution of its assets on or before the date that is eighteen months
from the date on which Millenium's consent solicitation terminates (the
"Millenium Proposals").
Millenium has recently purported to extend the solicitation period
because it has not been able to obtain the required number of votes to approve
the Millenium Proposals.
We urge you not to vote at all on the Millenium Proposals for the
reasons set forth below:
o the Millenium Proposals are not in the best
interests of the Limited Partners.
o neither Millenium nor its affiliates are limited
partners of the Partnership and thus, they are not
authorized to solicit your consent.
o the Consent Solicitation has not been conducted in
a manner permitted by the Partnership's Agreement
of Limited Partnership ("Partnership Agreement").
869696.2
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o by voting on the Millenium Proposals, Limited
Partners may risk losing their limited liability
status.
o Millenium's affiliates are known for making
so-called "mini-tender" offers and acquiring
limited partnership interests at steep discounts
to try to turn a quick profit on their investment;
while the Millenium Proposals may be in
Millenium's best interests, they are not
necessarily in your best interests.
The Managing General Partner intends to file a lawsuit asking the
court to rule that the Consent Solicitation violates the terms of your
Partnership Agreement.
In the meantime, we urge you to either vote against the Millenium
Proposals or simply not vote at all (which has the same effect as voting no).
If you have already voted in favor of the Millenium Proposals, you may
revoke your consent by sending a notice of revocation to Millenium. For your
convenience, we will be happy to forward your revocation to Millenium if you
wish to send it to us first. You will find complete instructions for revocation
in Appendix 1 to this letter.
1. Millenium Is Not Authorized to Solicit Your Consent.
Under the Partnership Agreement, only General Partners and Limited
Partners of the Partnership are authorized to submit a matter to the vote of the
Limited Partners. However, Millenium is attempting to solicit your consent to
the Millenium Proposals even though it is neither a general partner nor a
limited partner of the Partnership. Furthermore, the affiliates mentioned by
Millenium in the Consent Solicitation (as holding interests in the Partnership)
hold their interests in the Partnership as assignees only, which means that none
of them have been admitted to the Partnership as general or limited partners.
Since neither Millenium nor any of its affiliates has been admitted to the
Partnership as general or limited partners, they are not authorized under the
Partnership Agreement to solicit your consent; accordingly, the Consent
Solicitation lacks the power to effectuate the Millenium Proposals even if they
were to receive the required majority vote.
2. Millenium's Consent Solicitation Procedures are Improper.
The Partnership Agreement clearly sets forth the procedure which must
be followed in connection with any solicitation of the Limited Partners. Even if
Millenium was deemed to have the rights of a limited partner under the
Partnership Agreement as the result of the interests owned by its affiliates in
the Partnership, Millenium has not complied with such procedures.
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Simply put, no Limited Partner may submit any matter to the vote of
the other Limited Partners unless at least 10% of the Limited Partners have
previously requested that such matter be submitted for a vote. Since Millenium
does not own, either directly or indirectly through its affiliates, at least 10%
of the limited partnership interests of the Partnership, Millenium is not
authorized under the Partnership Agreement to submit the Millenium Proposals to
the vote of the Limited Partners. Accordingly, even if the Millenium Proposals
were to receive the required majority vote, the Consent Solicitation lacks the
power to effectuate the Millenium Proposals.
3. Your Limited Liability Status May Be Jeopardized.
The Partnership Agreement provides procedural protections which help
ensure that the limited liability status enjoyed by Limited Partners is not
inadvertently lost when they are asked to vote on Partnership matters. Even if,
as Millenium points out in its Consent Solicitation, it intends to satisfy the
requirements of this procedural protection on or before the termination of its
consent solicitation, Millenium fails to advise you that it is required to
obtain these protections before the vote of any Limited Partner is tendered and
that if it is unable to, you may have already jeopardized your limited liability
status by having participated in a consent solicitation.
Simply put, the Partnership Agreement provides that prior to any
Limited Partner exercising its right to vote on any matter, including its rights
to remove the current general partners and to replace them with a new general
partner, a court or legal opinion must conclude that the exercise of such rights
will not result in the loss of any Limited Partner's limited liability or
violate the State Uniform Limited Partnership Law.
Millenium states that it intends to satisfy this condition on or prior
to the termination of its consent solicitation. However, the Partnership
Agreement clearly indicates that this condition must be satisfied prior to any
Limited Partner vote. Accordingly, since Millenium has not satisfied the
conditions set forth in the Partnership Agreement, the Limited Partners lack the
power to remove the current general partners and replace them with Millenium
even if the Millenium Proposals receive the required vote of the Limited
Partners.
4. The Managing General Partner's Plan is Better for Limited Partners.
While the Millenium Proposal to sell the property and liquidate the
Partnership may maximize the short-term return on Millenium's investment in the
Partnership, it may not maximize your investment. The Managing General Partner
has been working on structuring a plan that will permit those Limited Partners
who need liquidity to sell their interests, while those who wish to maintain
their investment can seek to achieve appreciation on their investment.
869696.2
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Millenium's Plan. Millenium's express intent in pursuing the Consent
Solicitation is to appoint itself as general partner and then to sell the
remaining properties. Why? Because Millenium hopes to realize a quick profit on
its investment in the Partnership.
In the past, Millenium and its affiliates have frequently acquired
equity positions in limited partnerships or other entities pursuant to offers
known as "mini-tenders" (which are tender offers limited to less than 5% of the
outstanding units or shares of the entity in question). In connection with such
mini-tenders, the Millenium affiliates have often been able to purchase the
current holder's securities for a price well below market value. Entities which
engage in mini-tenders, like the Millenium affiliates, are able to purchase
securities at prices well below market value because their offers (as
mini-tenders) do not have to comply with many of the disclosure requirements
established by the Securities and Exchange Commission for the protection of
investors, including the requirement that they disclose the market price of such
securities. As a result, unsuspecting investors, assuming that all tender offers
are above the market price, fail to ascertain the market price for their
securities and often tender them for prices well below market price. Although we
do not know for certain how they acquired their interests in the Partnership,
Millenium states that certain of its affiliates own approximately 4.9% of the
outstanding Units, which suggests that they acquired their interest in the
manner described above, potentially at a price well below market value.
Given the foregoing, the current sale of the Partnership's properties
and the ultimate liquidation of the Partnership may be profitable to the
Millenium affiliates, but not to you and the other Limited Partners, due to the
reduced price at which the Millenium affiliates are likely to have purchased
their interest in the Partnership. Thus, the economic interests of Millenium and
its affiliates may not be aligned with yours or those of the other Limited
Partners.
The Managing General Partner's Plan. You should be aware that the
Managing General Partner is presently exploring opportunities which the Managing
General Partner believes will result in higher values being paid to the Limited
Partners than if the Millenium Proposals are implemented. More specifically, the
Managing General Partner is in the process of developing a plan pursuant to
which the properties owned by the Partnership would be combined with the
properties of other partnerships under the ownership of an entity whose shares
would be listed on a national exchange or national market system.
The Managing General Partner believes that the consummation of this
plan would create greater potential for increased distributions to you and the
other Limited Partners and for appreciation in the price of your equity
interests (as shareholders in the newly formed company) than there currently
exists. This growth potential would result from, among other things, (i) the
administrative and operational economies of scale and cost savings associated
with the combination of the Partnership with other partnerships engaging in
similar activities and (ii) the potential acquisition of additional properties.
Limited Partners (as shareholders in the newly formed company) would also enjoy
the benefits of a more liquid investment enabling
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them to (i) realize any appreciation in the price of their equity interests (in
the newly formed company) or (ii) exit the investment vehicle for any other
reason by selling such interests in a liquid marketplace.
The Managing General Partner, if retained as a general partner of the
Partnership, anticipates that a more definitive description of the above plan
will be distributed to the Limited Partners prior to the end of this year.
Notwithstanding the foregoing, all Limited Partners should recognize that the
plan described above is in the preliminary stages and the Managing General
Partner can make no assurances that such plan will be consummated.
For your information, the Managing General Partner holds 98.8% of the
1% general partnership interest in the Partnership; it does not own any limited
partnership interests.
Please do not hesitate to call us at (314) 206-4675 and ask for Ms.
Glenda White if you have any questions.
Sincerely,
NOONEY REAL PROPERTY INVESTORS-
FOUR, L.P.
By: Nooney Capital Corp., its general
partner
By:/s/Gregory J. Nooney, Jr.
---------------------------
Gregory J. Nooney, Jr.
Vice Chairman of the Board of Directors
869696.2
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APPENDIX 1
How To Revoke
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The Partnership urges each Limited Partner to carefully consider the
information contained in the foregoing letter and to withhold voting on the
Millenium Proposals. If you have already returned your consent form (and voted
to approve the Millenium Proposals), and now wish to revoke your approval, you
should follow the following procedures which are the procedures set forth in
Millenium's Consent Solicitation (even though we do not believe that this is the
only method by which a Limited Partner should be entitled to revoke):
o Prepare a written statement (the "Revocation Notice") which sets forth
the following information:
(1) your name, the number of units of limited partnership interest in
the Partnership which you own (the "Units") and that you are the
record holder of the Units or, if you are not the record holder of the
Units, your name, the capacity in which you represent the record
holder of the Units, the name of the record holder of the Units and
the number of Units such record holder owns;
(2) that you are revoking, either on your own behalf or on behalf of
the record holder of the Units, your original vote in favor of the
Millenium Proposals;
(3) the name, if different from yours, of the person who executed the
original consent form approving the Millenium Proposals; and
(4) that this revocation is intended to be effective with respect to
all of the Units you or the record holder which you represent owns.
o Sign the Revocation Notice exactly as your name appears on the
Partnership's records.
o Joint owners should each sign the Revocation Notice.
o Attorneys-in-fact, executors, administrators, trustees, guardians,
corporation officers or others acting in representative capacity for
the record holder of the Units should indicate the capacity in which
they sign and should give their full title, and submit appropriate
evidence of authority to execute the Revocation Notice.
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o All Revocation Notices should be mailed as soon as possible either
directly to Millenium or to us, in which event we will forward them to
Millenium:
If to Millenium: Millenium Investors 2, LLC
199 South Los Robles Avenue, Suite 440
Pasadena, California 91101
If to the Partnership: Nooney Real Property Investors-Four, L.P.
One Memorial Drive
Suite 1000
St. Louis Missouri 63102
869696.2
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