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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 16, 1997
WESTIN HOTELS LIMITED PARTNERSHIP
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(Exact name of Registrant as specified in its charter)
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<S> <C> <C>
Delaware 0-15097 91-1328985
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
2001 Sixth Avenue
Seattle, Washington 98121
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (206) 443-5000
N/A
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(Former name or former address, if changed since last report)
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WESTIN HOTELS LIMITED PARTNERSHIP
AND SUBSIDIARIES
REPORT ON FORM 8-K
ITEM 5. OTHER EVENTS.
On June 16, 1997, in response to another offer from Kalmia Investors
LLC to the limited partners to purchase their Units for $450 per Unit, the
General Partner distributed a letter to its limited partners listing the
following five points to consider before accepting this or any other purchase
offer:
1. The General Partner intends to reinstate cash distributions on a
quarterly basis and, pending approval by the Board of Directors,
the first check will be sent by September 15, 1997.
2. The General Partner has suspended its approval of transfers of
Unit sales for the remainder of 1997 in order to rely on the
protections of the 5% safe harbor per Section 7704 of the Internal
Revenue Code.
3. Any limited partners who sell their Units between now and the next
effective date of March 31, 1998, will receive Schedule K-1's for
1997 in 1998 and for the first three months of 1998 in 1999.
4. Since there are tax ramifications to consider when a Unit seller
assigns cash distributions to a potential Unit buyer, those
limited partners interested in selling their Units should first
consult with their tax advisor.
5. Prices at Limited Partnership Exchanges for the purchase of Units
continue to be higher than those of the recent purchase offers.
Trading prices at Limited Partnership Exchanges were $505.93 for
the first quarter of 1997 and $530.37 for the first part of the
second quarter, until sales were suspended.
A complete copy of this General Partner's letter to the limited
partners is included as an exhibit to this report.
On July 7, 1997, the General Partner distributed a letter to the
limited partners announcing that the Board of Directors of the General Partner
had authorized Westin Hotels Limited Partnership to distribute to the limited
partners an amount equal to an annual noncumulative $95 return per Unit for the
1997 calendar year. This cash distribution will be paid in two installments on
September 15 and December 15, 1997 - each in the amount of $47.50 per Unit. This
decision was based on a thorough evaluation of available net cash from
operations and reflects the success of recent strategies.
A complete copy of this General Partner's letter to the limited
partners is included as an exhibit to this report.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) EXHIBITS
20.1 Letter to Limited Partners dated June 16, 1997.
20.2 Letter to Limited Partners dated July 7, 1997.
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SIGNATURES
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.
WESTIN HOTELS LIMITED PARTNERSHIP
(a Delaware limited partnership)
By: WESTIN REALTY CORP.,
Its sole General Partner
By: /s/ Richard Mahoney
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Richard Mahoney, Director,
Vice President, Chief Financial
Officer and Treasurer
DATE: July 8, 1997
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EXHIBIT INDEX
Item
No. Description Page
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20.1 Letter to Limited Partners dated June 16, 1997.
20.2 Letter to Limited Partners dated July 7, 1997.
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June 16, 1997
Dear Limited Partners:
It is our understanding that Kalmia Investors LLC has sent out another offer to
purchase Units. This time they are offering "$450 cash per Unit, which amount
will be reduced by any cash distributions made by the Partnership on or after
May 1, 1997, without regard to the record date or date of such distribution."
The General Partner is sending this letter to advise you of the following
matters you should consider before accepting this or any other offer to sell
your Units.
1. Distributions Will Be Made to Limited Partners During the 1997 Third
Quarter.
The General Partner intends to reinstate cash distributions on a
quarterly basis and, pending approval by the Board of Directors, you
will receive the first of the reinstated distributions on September 15.
2. Unit Sales Are Suspended for the Remainder of 1997.
In 1996, the General Partner determined it to be in the best interest
of the Partnership to implement a Unit transfer policy that relies on
the protections of the 5% safe harbor, promulgated by the Internal
Revenue Service, to prevent the Partnership from being deemed a
"publicly traded partnership" pursuant to Section 7704 of the Internal
Revenue Code. The 5% safe harbor applies if the sum of the percentage
interest in partnership capital or profits represented by Units traded
during any calendar year does not exceed 5% of the total Partnership.
On April 21, 1997, the General Partner had approved transfer requests
totaling 6,848 Unit sales (5%) and, therefore, suspended its approval
of transfers of Unit sales for the remainder of 1997. As a result, any
subsequent sales of limited partnership Units will not be recognized
and effected by the Partnership until the first quarter of 1998. The
Partnership is attempting to seek relief through a private letter
ruling from the IRS, although there is no present indication that any
relief is available or would be granted. Should our inquiry result in a
material change in our situation, we will promptly notify you.
3. Selling Unitholders Will Receive K-1's for 1997 and 1998.
The Partnership will continue to accept the paperwork for Unit sales
for processing in 1998. The Unit seller, however, will remain the
owners of record until March 31, 1998. As such, these selling limited
partners will be issued a Schedule K-1 reflecting their share of the
Partnership's taxable income and losses for federal income tax purposes
in 1998 for the 1997 tax year and another in 1999 for the first three
months of 1998.
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4. Assignment of Distribution Rights.
Some of the paperwork we receive assigns the Unit seller's
distributions to the buyer. In such cases, we change the address of the
owner of record to that of the assignee/buyer for purposes of cash
distributions. As a result, even if the sale has not yet become
effective, the cash distribution checks will be sent to the buyer's
address.
The limited partner's tax basis for his Units includes the amount of
money paid for the Units and the share of any nonrecourse liabilities
of the Partnership. A limited partner's tax basis is increased or
decreased by the allocable share of any Partnership taxable income or
loss. The tax basis will be decreased by cash distributions from the
Partnership. In sum, a Unit seller's tax basis will continue to be
subject to adjustments until a Unit sale is effected in 1998 despite
any assignment of the sellers economic interest in his or her Units in
connection with a proposed Unit sale. Therefore, you are strongly urged
to consult with your tax advisor on the tax ramifications with respect
to assigning your distributions as well as selling your Units.
5. Trading Prices at Limited Partnership Exchanges.
The prices at Limited Partnership Exchanges continue to be higher than
those of the recent offers. The average price per Unit for sales of
Units reported to the Partnership through Limited Partnership Exchanges
for the first quarter of 1997 was $505.93. The average price per Unit
for the first part of the second quarter of 1997 until sales were
suspended was $530.37.
Please feel free to contact our Investor Relations Department at 1-800-332-5888
with any questions or concerns. Because this is a unique situation for the
Partnership, we cannot anticipate all the issues that may arise, however, we
will notify you should there be any changes to our policies or procedures.
Sincerely,
Westin Hotels Limited Partnership
by Westin Realty Corp., its General Partner
Richard Mahoney
Vice President, Chief Financial Officer &
Treasurer
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July 7, 1997
Dear Limited Partners:
We are pleased to announce that the Board of Directors of the General Partner
has authorized Westin Hotels Limited Partnership to distribute to the limited
partners an amount equal to an annual noncumulative $95 return per unit for the
1997 calendar year. This cash distribution will be paid in two installments on
September 15 and December 15, 1997 - each in the amount of $47.50 per unit.
This decision was based on a thorough evaluation of available cash from
operations of The Westin St. Francis and The Westin Michigan Avenue, Chicago. It
reflects the success of the strategies initiated by the General Partner of
refinancing the mortgage loans and investing in capital improvements at both
Hotels to significantly improve operations and generate enough cash for the
resumption of cash distributions.
The next quarterly report, describing the results of the Partnership's
operations for the second quarter of 1997, will be mailed in mid-August.
Please note that any requests concerning changes in ownership of Partnership
units (name, address, account number or taxpayer identification number) must be
made in writing.
Sincerely,
Westin Hotels Limited Partnership
Richard Mahoney
Vice President, Chief Financial Officer
and Treasurer
