<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------
SCHEDULE 14D-1
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(d)(1) OF THE SECURITIES EXCHANGE
ACT OF 1934
--------------
WESTIN HOTELS LIMITED PARTNERSHIP
A DELAWARE LIMITED PARTNERSHIP
(NAME OF SUBJECT COMPANY)
KALMIA INVESTORS, LLC
A DELAWARE LIMITED LIABILITY COMPANY
ARLEN CAPITAL, LLC
A CALIFORNIA LIMITED LIABILITY COMPANY
(Bidder)
UNITS OF LIMITED PARTNERSHIP INTERESTS
(TITLE OF CLASS OF SECURITIES)
960 377 109
(CUSIP Number of Class of Securities)
Arlen Capital, LLC
Don Augustine, Manager
1650 Hotel Circle North - Suite 200
San Diego, California 92108
(619) 686-2002
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications on Behalf of Bidder)
With a copy to:
Peter R. Pancione, Esq.
Gipson Hoffman & Pancione
1901 Avenue of the Stars - Suite 1100
Los Angeles, California 90067
Telephone: (310) 556-4660
Facsimile: (310) 556-8945
--------------
CALCULATION OF FILING FEE
================================================================================
TRANSACTION VALUATION* AMOUNT OF FILING FEE
$4,900,000 $980
- --------------------------------------------------------------------------------
* FOR PURPOSES OF CALCULATING THE FILING FEE ONLY. THIS CALCULATION ASSUMES
THE PURCHASE OF 4,900 UNITS AT A PURCHASE PRICE OF $1,000 PER UNIT IN THE
PARTNERSHIP. THE AMOUNT OF THE FILING FEE, CALCULATED IN ACCORDANCE WITH
WITH REGULATION 0-11 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED,
EQUALS 1/50 OF ONE PERCENT OF THE VALUE OF UNITS ASSUMED TO BE PURCHASED.
[ ] CHECK BOX IF ANY PART OF THE FEE IS OFFSET AS PROVIDED BY RULE 0-11(A)(2)
AND IDENTIFY THE FILING WITH WHICH THE OFFSETTING FEE WAS PREVIOUSLY PAID.
IDENTIFY THE PREVIOUS FILING BY REGISTRATION STATEMENT NUMBER, OR THE FORM
OR SCHEDULE AND THE DATE OF ITS FILING.
AMOUNT PREVIOUSLY PAID: NOT APPLICABLE FILING PARTY: NOT APPLICABLE
FORM OF REGISTRATION NO.: NOT APPLICABLE DATE FILED: NOT APPLICABLE
================================================================================
Page 1 of 8
<PAGE>
------------------- -----------------
CUSIP NO. 960377109 Page 2 of 8 Pages
------------------- -----------------
================================================================================
1. Names of Reporting Persons
S.S. or I.R.S. Identification Nos. of Above Persons
Kalmia Investors, LLC - IRS Identification #41-1848556
- --------------------------------------------------------------------------------
2.0 Check the Appropriate Box if a Member of a Group (See Instructions)(a) [ ]
(b) [ ]
- --------------------------------------------------------------------------------
3. SEC Use Only
- --------------------------------------------------------------------------------
4. Sources of Funds (See Instructions)
WC
- --------------------------------------------------------------------------------
5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(e) or 2(f) [ ]
- --------------------------------------------------------------------------------
6. Citizenship or Place of Organization
State of Delaware
- --------------------------------------------------------------------------------
7. Aggregate Amount Beneficially Owned By Each Reporting Person
8,475
- --------------------------------------------------------------------------------
8. Check if the Aggregate in Row (7) Excludes Certain Units (See
Instructions) [ ]
- --------------------------------------------------------------------------------
9. Percent of Class Represented by Amount in Row (7)
Approximately 6.25%
- --------------------------------------------------------------------------------
10. Type of Reporting Persons (See Instructions)
OO
================================================================================
Page 2 of 8
<PAGE>
------------------- -----------------
CUSIP NO. 960377109 Page 3 of 8 Pages
------------------- -----------------
================================================================================
1. Names of Reporting Persons
S.S. or I.R.S. Identification Nos. of Above Persons
Arlen Capital, LLC - IRS Identification #33-0713478
- --------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group (See Instructions)(a) [ ]
(b) [ ]
- --------------------------------------------------------------------------------
3. SEC Use Only
- --------------------------------------------------------------------------------
4. Sources of Funds (See Instructions)
AF
- --------------------------------------------------------------------------------
5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(e) or 2(f) [ ]
- --------------------------------------------------------------------------------
6. Citizenship or Place of Organization
State of California
- --------------------------------------------------------------------------------
7. Aggregate Amount Beneficially Owned By Each Reporting Person
8,475 Units
- --------------------------------------------------------------------------------
8. Check if the Aggregate in Row (7) Excludes Certain Units (See
Instructions) [ ]
- --------------------------------------------------------------------------------
9. Percent of Class Represented by Amount in Row (7)
Approximately 6.25%
- --------------------------------------------------------------------------------
10. Type of Reporting Persons (See Instructions)
CO
================================================================================
Page 3 of 8
<PAGE>
ITEM 1. SECURITY AND SUBJECT COMPANY
(a) The name of the subject company is Westin Hotels Limited Partnership,
a Delaware limited Partnership, and the address of its business offices is 2231
East Camelback Road, Suite 400, Phoenix, Arizona 85016-3435.
(b) The information set forth in the "Introduction" of the Offer to
Purchase is incorporated herein by reference.
This Schedule 14D-1 relates to a tender offer by Kalmia Investors, LLC, a
Delaware limited liability company ("Purchaser"), to purchase 4,900 Units of
Limited Partnership Interests ("Units") of Westin Hotels Limited Partnership, a
Delaware limited partnership (the "Partnership"), at $1,000 per Unit, without
interest thereon, upon the terms and subject to the conditions set forth in the
Offer to Purchase, dated February 1, 1999, and the related Agreement of Sale
(which together constitute the "Offer"), which are attached to and filed with
this Schedule 14D-1 as Exhibits (a)(1) and (a)(2), respectively, and
incorporated herein by reference. This Schedule 14D-1 is being filed on behalf
of Purchaser.
(c) The information set forth in the "Introduction" and Section 7
("Purpose and Effect of the Offer") of the Offer to Purchase is incorporated
herein by reference.
ITEM 2. IDENTITY AND BACKGROUND
(a)-(d) and (g) The information set forth in the "Introduction," Section
11 ("Certain Information Concerning the Purchaser"), Section 12 ("Source and
Amount of Funds") and Schedule 1 of the Offer to Purchase is incorporated herein
by reference.
(e)-(f) During the last five years, neither the Purchaser, nor to the best
of their knowledge, any of their respective executive officers and directors
listed in Schedule 1 of the Offer to Purchase (i) has been convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors) or
(ii) was a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding any such person was or
is subject to a judgment, decree or final order enjoining future violations of,
or prohibiting activities subject to, federal or state securities laws or
finding any violation of such laws.
(g) The information set forth in Schedule 1 to the Offer to Purchase is
incorporated herein by this reference.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT
COMPANY
(a) Not applicable.
(b) The information set forth in Section 9 ("Past Contacts and
Negotiations with General Partners") of the Offer to Purchase is incorporated
herein by this reference.
Page 4 of 8
<PAGE>
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
(a) The information set forth in Section 12 ("Source and Amount of
Funds") of the Offer to Purchase is incorporated herein by reference.
(b) Not applicable.
(c) Not applicable.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER
(a)-(g) The information set forth in the "Introduction," Section 7
("Purpose and Effects of the Offer") and Section 8 ("Future Plans") of the Offer
to Purchase are incorporated herein by reference.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY
(a)-(b) The information set forth in the "Introduction" and Section 11
("Certain Information Concerning the Purchaser") of the Offer to Purchase are
incorporated herein by reference.
ITEM 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS
WITH RESPECT TO THE SUBJECT COMPANY'S SECURITIES
The information set forth in Section 9 ("Past Contracts and Negotiations
With the General Partner") is incorporated herein by reference.
ITEM 8. PERSONS RELATED, EMPLOYED OR TO BE COMPENSATED
The information set forth in the "Introduction" and Section 15 ("Fees and
Expenses") of the Offer to Purchase are incorporated herein by reference.
ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS
Not applicable.
ITEM 10. ADDITIONAL INFORMATION
(a) The information set forth in Section 9 ("Past Contracts and
Negotiations with the General Partner") is incorporated herein by reference.
(b)-(c) The information set forth in the "Introduction," Section 7
("Purpose and Effects of the Offer") and Section 14 ("Certain Legal Matters and
Regulatory Approvals") of the Offer to Purchase are incorporated herein by
reference.
Page 5 of 8
<PAGE>
(d) Not applicable.
(e) Not applicable.
(f) Reference hereby is made to the Offer to Purchase and the related
Agreement of Sale, copies of which are attached hereto as Exhibits (a)(1) and
(a)(2), respectively, which are incorporated in their entirety herein by
reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS
(a)(1) - Offer to Purchase, dated February 1, 1999.
(a)(2) - Agreement of Sale.
(a)(3) - Cover Letter, dated February 1, 1999, from Purchaser to Unit
Holders.
(a)(4) - Summary Publication.
(b) - Not applicable.
(c)(1) - Letter Agreements between Purchaser and the Partnership regarding
Agreement of Sale and Instructions dated October 9, 1996 and
November 1, 1996.
(d) - Not applicable.
(e) - Not applicable.
(f) - Not applicable.
Page 6 of 8
<PAGE>
SIGNATURE
After due 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: February 1, 1999 KALMIA INVESTORS, LLC
By: Arlen Capital, LLC
its Manager
By: /s/ Don Augustine
----------------------------
Don Augustine, Manager
ARLEN CAPITAL, LLC
By: /s/ Don Augustine
---------------------------
Don Augustine, Manager
Page 7 of 8
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Sequential
----------
Exhibit No. Description Page Number
- ------------ ----------- -----------
<S> <C> <C>
(a)(1) - Offer to Purchase, dated February 1, 1999.
(a)(2) - Agreement of Sale.
(a)(3) - Cover Letter, dated February 1, 1999
from Purchaser to Limited Partners.
(a)(4)- Summary Publication.
(b) - Not applicable.
(c)(1) - Letter Agreement between Purchaser and the
Partnership regarding Agreement of Sale and
Instructions dated October 9, 1996 and
November 1, 1996.
(d) - Not applicable.
(e) - Not applicable.
(f) - Not applicable.
</TABLE>
Page 8 of 8
<PAGE>
OFFER TO PURCHASE FOR CASH
UNITS OF LIMITED PARTNERSHIP INTERESTS
OF
WESTIN HOTELS LIMITED PARTNERSHIP
AT
$1,000 NET PER UNIT
BY
KALMIA INVESTORS, LLC
----------------------------------------------------------------------
THE OFFER, WITHDRAWAL RIGHTS AND PRORATION PERIOD WILL
EXPIRE AT 12:00 MIDNIGHT, EASTERN TIME, ON
MARCH 2, 1999, UNLESS THE OFFER IS EXTENDED.
----------------------------------------------------------------------
Kalmia Investors, LLC, a Delaware limited liability company (the
"Purchaser" or "Kalmia"), hereby offers to purchase up to 4,900 units of limited
partnership interests including any rights attributable to claims, damages,
recoveries, including recoveries from any class action lawsuits, and causes of
action accruing to the ownership of such units of limited partnership interests
("Units") in Westin Hotels Limited Partnership, a Delaware limited partnership
(the "Partnership"), at a purchase price of $1,000 net per Unit, without
interest, and less the amount of any cash distributions declared or paid,
including any return of capital made in cash with respect to the Units after
December 15,1998 (the "Purchase Price"), upon the terms and subject to the
conditions set forth in this Offer to Purchase (the "Offer to Purchase") and in
the related Agreement of Sale, as each may be supplemented or amended from time
to time (which together constitute the "Offer"). The 4,900 Units sought to be
purchased pursuant to the Offer represent, to the best knowledge of the
Purchaser, approximately 3.6% of the Units outstanding as of the date of the
Offer.
THE OFFER TO PURCHASE IS NOT CONDITIONED UPON THE VALID TENDER OF ANY
MINIMUM NUMBER OF UNITS. IF MORE THAN 4,900 UNITS ARE VALIDLY TENDERED AND NOT
WITHDRAWN, THE PURCHASER WILL ACCEPT FOR PURCHASE UP TO 4,900 OF THE TENDERED
UNITS, ON A PRO RATA BASIS, SUBJECT TO THE TERMS AND CONDITIONS HEREIN, SEE
"TENDER OFFER--SECTION 13. CERTAIN CONDITIONS OF THE OFFER."
A HOLDER OF UNITS ("UNIT HOLDER") MAY TENDER ANY OR ALL UNITS OWNED BY SUCH
UNIT HOLDER.
FOR MORE INFORMATION OR FOR FURTHER ASSISTANCE PLEASE CALL:
Arlen Capital, LLC
1-800-891-4105
February 1, 1999
<PAGE>
IMPORTANT
Any Unit Holder desiring to tender any or all of his/her Units should
complete and sign the Agreement of Sale in accordance with the instructions in
the Agreement of Sale and mail or deliver a fully executed original of the
Agreement of Sale along with any other required documents to the Purchaser at
the address set forth on the back cover of this Offer to Purchase, or request
his/her broker, dealer, commercial bank, credit union, trust company or other
nominee to effect the transaction on their behalf.
QUESTIONS OR REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES OF THIS OFFER TO
PURCHASE OR THE AGREEMENT OF SALE MAY BE DIRECTED TO ARLEN CAPITAL, LLC (THE
"DEPOSITARY") BY CALLING THE TOLL-FREE INFORMATION LINE: 1-800-891-4105.
---------------------------------------------------------------
NO PERSON HAS BEEN AUTHORIZED TO MAKE ANY RECOMMENDATION OR ANY
REPRESENTATION ON BEHALF OF THE PURCHASER OR TO PROVIDE ANY INFORMATION OTHER
THAN AS CONTAINED HEREIN OR IN THE AGREEMENT OF SALE. NO SUCH RECOMMENDATION,
INFORMATION OR REPRESENTATION MAY BE RELIED UPON AS HAVING BEEN AUTHORIZED.
[INTENTIONALLY LEFT BLANK]
(2)
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C>
INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
OFFER TO PURCHASE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
Section 1. Terms of the Offer.. . . . . . . . . . . . . . . . . . . . . . . . . . .5
Section 2. Proration; Acceptance for Payment and Payment for Units. . . . . . . . .5
Section 3. Procedures for Tendering Units.. . . . . . . . . . . . . . . . . . . . .7
Valid Tender. . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
Backup Federal Income Tax Withholding . . . . . . . . . . . . . . . .7
Tenders by Beneficial Holders . . . . . . . . . . . . . . . . . . . .8
Signature Guarantees. . . . . . . . . . . . . . . . . . . . . . . . .8
Appraisal Rights. . . . . . . . . . . . . . . . . . . . . . . . . . .8
Other Requirements. . . . . . . . . . . . . . . . . . . . . . . . . .8
Determination of Validity; Rejection of Units; Waiver of Defects;
No Obligation to Give Notice of Defects. . . . . . . . . . . . . .9
Section 4. Withdrawal Rights. . . . . . . . . . . . . . . . . . . . . . . . . . . .9
Section 5. Extension of Tender Period; Termination; Amendment . . . . . . . . . . 10
Section 6. Certain Tax Consequences . . . . . . . . . . . . . . . . . . . . . . . 10
Section 7. Purpose and Effects of the Offer.. . . . . . . . . . . . . . . . . . . 11
Purpose of the Offer. . . . . . . . . . . . . . . . . . . . . . . . 11
Effect on Trading Market and Price Range of the Units . . . . . . . 14
Section 8. Future Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 9. Past Contacts and Negotiations With General Partner. . . . . . . . . . 16
Section 10. Certain Information Concerning the Business of the Partnership
and Related Matters . . . . . . . . . . . . . . . . . . . . . . . . 17
Business. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 11. Certain Information Concerning the Purchaser. . . . . . . . . . . . . 21
Section 12. Source of Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(i)
<PAGE>
Section 13. Certain Conditions of the Offer . . . . . . . . . . . . . . . . . . . 22
Section 14. Certain Legal Matters and Required Regulatory Approvals.. . . . . . . 25
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Antitrust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
State Takeover Laws . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 15. Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 16. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SCHEDULE 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .S-1-1
SCHEDULE 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .S-2-1
</TABLE>
(ii)
<PAGE>
To the Holders of Units of Limited Partnership Interests
of Westin Hotels Limited Partnership
INTRODUCTION
Kalmia Investors, LLC, a Delaware limited liability company (the
"Purchaser" or "Kalmia"), hereby offers to purchase up to 4,900 units of
limited partnership interests including any rights attributable to claims,
damages, recoveries, including recoveries from any class action lawsuits, and
causes of action accruing to the ownership of such units of limited
partnership interests ("Units") of Westin Hotels Limited Partnership, a
Delaware limited partnership (the "Partnership"), at a purchase price of
$1,000 net per Unit, without interest, less the amount of any cash
distributions declared or paid, including any cash return of capital, if any,
(collectively hereinafter referred to as "Distributions") made or declared
with respect to the Units after December 15, 1998 (the "Purchase Price"),
upon the terms and subject to the conditions set forth in this Offer to
Purchase and in the related Agreement of Sale (which together constitute the
"Offer"). The 4,900 Units sought to be purchased pursuant to the Offer
represent, to the best knowledge of the Purchaser, approximately 3.6% of the
Units outstanding as of the date of the Offer.
We encourage you to consider the following factors:
- - Holders of Units ("Unit Holders") who tender their Units will be
giving up the opportunity to participate in any future potential
benefits represented by ownership of Units, including, for example,
the right to participate in any future distribution of cash or
property, whether from operations, the proceeds of a sale of the
Partnership's assets or in connection with any future liquidation of
the Partnership. However, there is no guarantee of future results of
the Partnership and investment in the Partnership.
- - Although the Purchaser cannot predict the future value of the
Partnership's assets on a per Unit basis, the Purchase Price could
differ significantly from the net proceeds that would be recognized on
a per Unit basis from the sale of the Partnership's assets or that may
be realized upon a future liquidation of the Partnership.
- - The tax consequences of the Offer to a particular Unit Holder may be
different from those of other Unit Holders and we urge you to consult
your own tax advisors in connection with the Offer.
- - Unit Holders should note that the most recent reported trading
activity in the Units occurred from August 1, 1998 to September 30,
1998. The average weighted price for Units reported in the limited
and sporadic secondary market during the two-month period was $925
encompassing 480 Units (as reported by Partnership Spectrum, a third
party publication). Such secondary market selling prices, however, do
not take into account commissions charged by secondary market makers
effectuating such sales which the Purchaser believes, based on a
typical ten Unit sales transaction, range from 5% to 8% of the sales
proceeds
1
<PAGE>
(which would result in a reduction of the net proceeds to the seller
of approximately $462 to approximately $740).
- - The Partnership in a Current Report on Form 8-K dated February 23,
1998 and filed on the same date with the Commission enclosed as an
Exhibit to such Report a letter to the Partnership's limited partners
which stated, in part:
"RESULTS OF A RECENT APPRAISAL
In January 1998, the General Partner received reports
estimating that the market value for the Hotels is in excess
of $400 million on a combined Hotel basis. Based on these
estimated values and after consideration of Partnership
liabilities, the General Partner has concluded that the
calculated value of the limited partners' equity is
significantly in excess of the $700 per Unit offer from
Kalmia.* It is important to note that such appraisal does
not necessarily reflect the fair market value of the Units
or what a limited partner would realized on liquidation of
the Hotels."
*This refers to a prior offer made by Purchaser. See Section 9
("Past Contacts and Negotiations With General Partner").
- - The Purchaser is making the Offer with a view towards making a profit.
Accordingly, there may be a conflict between the desire of the
Purchaser to acquire the Units at a low price and the desire of the
Unit Holders to sell the Units at a high price. No independent person
has been retained to evaluate or render any opinion with respect to
the fairness of the $1,000 Purchase Price and no representation is
made as to such fairness. Other measures of value may be relevant to
a Unit Holder and all Unit Holders are urged to carefully consider all
of the information contained in the Offer to Purchase and Agreement of
Sale and to consult with their own advisors (tax, financial or
otherwise) in evaluating the terms of the Offer before deciding
whether to tender their Units.
Unit Holders may no longer wish to continue with their investment in the
Partnership and might consider accepting the Offer for one or more of the
following reasons:
- - There is no public market for the Units and it is not anticipated that
a public market will develop. (See the Partnership's Annual Report on
Form 10-K for the fiscal year ended December 31, 1997). Unit Holders
who desire resale liquidity may wish to consider the Offer. The Offer
affords a significant number of Unit Holders with an opportunity to
dispose of their Units for cash, which otherwise might not be
available to them. The Purchase Price is not intended to represent
either the fair market value of a Unit or the Partnership's assets on
a per Unit basis. Although there are some limited resale mechanisms
available to the Unit Holders wishing to sell their Units, there is no
formal or organized trading market for the Units.
2
<PAGE>
- - The Offer may be attractive to certain Unit Holders who wish in the
future to avoid the continued additional expense, delay and
complication in filing income tax returns which result from the
ownership of the Units.
- - The Offer provides Unit Holders with the opportunity to liquidate
their Units and to reinvest the proceeds in other investments should
they desire to do so.
- - The Offer will provide Unit Holders with an immediate opportunity to
liquidate their investment in the Partnership without the usual
transaction costs associated with secondary market sales.
If you wish to sell some or all of your Units now, please read carefully
the enclosed Offer to Purchase and the Agreement of Sale. All you need to do is
complete the Agreement of Sale in accordance with the instructions provided
therein, sign where indicated, have your signature Medallion Guaranteed and
return it to the Purchaser, in the pre-addressed return envelope. If you desire
to accept this Offer, please carefully follow the instructions on the Agreement
of Sale. Errors will delay and possibly prevent acceptance of your tender of
the Units.
If, prior to the Expiration Date, the Purchaser increases the consideration
offered to Unit Holders pursuant to the Offer, such increased consideration will
be paid with respect to all Units that are purchased pursuant to the Offer,
whether or not such Units were tendered prior to such increase in consideration.
The Offer is being made by the Purchaser as a speculative investment based
upon the belief that the Units represent an attractive investment at the price
offered based upon, in part, the expected liquidation of the Partnership's
assets. The purpose of the Offer is to allow the Purchaser to benefit from any
one combination of the following: (i) any cash distributions from Partnership
operations in the ordinary course of business; (ii) distributions, if any, of
net proceeds from the liquidation of any properties after the Partnership has
satisfied its liabilities; (iii) any cash from any redemption of the Units by
the Partnership; and (iv) sale of the Units.
The Offer is not conditioned upon the valid tender of any minimum number
of the Units. If more than 4,900 Units, are validly tendered and not
withdrawn, the Purchaser will accept up to 4,900 of the tendered Units for
purchase on a pro rata basis, subject to the terms and conditions herein. See
"Tender Offer--Section 13. Certain Conditions of the Offer." The Purchaser
expressly reserves the right to terminate the Offer at anytime and to waive
any or all of the conditions of the Offer, although the Purchaser does not
presently intend to waive any such conditions.
The Partnership is subject to the information and reporting requirements of
the Securities Exchange Act of 1934, as amended ("Exchange Act"), and in
accordance therewith is required to file reports and other information with the
Securities and Exchange Commission ("Commission") relating to its business,
financial condition and other matters. Such reports and other information are
available on the Commission's Electronic Data Gathering and Retrieval System
(EDGAR), at its internet website at www.sec.gov.com and may be inspected at the
public reference facilities
3
<PAGE>
maintained by the Commission at room 1024, Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549, and is available for inspection and copying at
the regional offices of the Commission located in Northwestern Atrium Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661 and at 7 World
Trade Center, 13th Floor, New York, New York 10048. Copies of such material
can also be obtained from the Public Reference Room of the Commission in
Washington, D.C. at prescribed rates.
The Purchaser has filed with the Commission a Tender Offer Statement on
Schedule 14D-1 (including exhibits) pursuant to Rule 14d-3 of the General Rules
and Regulations under the Exchange Act, which provides certain additional
information with respect to the Offer. Such Statements and any amendments
thereto, including exhibits, may be inspected and copies may be obtained from
the Commission in the manner specified above.
According to publicly available information, there were 135,600 Units
issued and outstanding at December 31, 1997, held by approximately 8,248 Unit
Holders. The Purchaser currently owns 8,475 Units which is approximately 6.25%
of the outstanding Units.
Information contained in this Offer to Purchase which relates to, or
represents statements made by the Partnership or the General Partner, has been
derived from information provided in reports and other information filed with
the Commission by the Partnership and General Partner.
Unit Holders are urged to read this Offer to Purchase and the accompanying
Agreement of Sale carefully before deciding whether to tender their Units.
4
<PAGE>
OFFER TO PURCHASE
SECTION 1. TERMS OF THE OFFER. Upon the terms and subject to the
conditions of the Offer, the Purchaser will accept for payment and pay for up to
4,900 Units that are validly tendered on or prior to the Expiration Date and not
withdrawn in accordance with Section 4 of this Offer to Purchase. The term
"Expiration Date" shall mean 12:00 midnight, Eastern Time, on March 2, 1999,
unless and until the Purchaser shall have extended the period of time for which
the Offer is open, in which event the term "Expiration Date" shall mean the
latest date on which the Offer, as so extended by the Purchaser shall expire.
Subject to any approval rights of the General Partner under the terms of
the Partnership Agreement, the Purchaser reserves the right to transfer or
assign, (in whole or in part from time to time), to one or more of the
Purchaser's affiliates, the right to purchase all or any portion of the Units
tendered pursuant to the Offer. Any such transfer or assignment will not relieve
the Purchaser of its obligations under the Offer or prejudice the rights of
tendering Unit Holders to receive payment for Units validly tendered and
accepted for payment pursuant to the Offer.
The Offer is conditioned on satisfaction of certain conditions. See "Tender
Offer--Section 13. Certain Conditions of the Offer," which sets forth in full
the conditions of the Offer. The Purchaser reserves the right (but shall not be
obligated), for any reason, or for no reason, to waive any or all of such
conditions or to terminate the offer at any time. If any or all of such
conditions have not been satisfied or waived by the Expiration Date, the
Purchaser reserves the right (but shall not be obligated) to (i) decline to
purchase any of the Units tendered, (ii) terminate the Offer and return all
tendered Units to tendering Unit Holders, (iii) waive all the unsatisfied
conditions and, subject to complying with applicable rules and regulations of
the Commission, purchase all Units validly tendered, (iv) extend the Offer and,
subject to the right of Unit Holders to withdraw Units until the Expiration
Date, retain the Units that have been tendered during the period or periods for
which the Offer is extended or (v) to otherwise amend the Offer.
The Offer to Purchase and the related Agreement of Sale are being mailed at
the Purchaser's expense to Unit Holders or beneficial owners of Units (in case
of Individual Retirement Accounts (IRA) and qualified plans).
SECTION 2. PRORATION; ACCEPTANCE FOR PAYMENT AND PAYMENT FOR UNITS. If not
more than 4,900 Units are validly tendered and not properly withdrawn prior to
the Expiration Date the Purchaser, upon the terms and subject to the conditions
of the Offer, will accept for payment all such Units so tendered.
If more than 4,900 Units are validly tendered and not properly withdrawn on
or prior to the Expiration Date, the Purchaser, upon the terms and subject to
the conditions of the Offer, will accept for payment 4,900 Units so tendered, on
a pro rata basis with appropriate adjustments to avoid tenders of fractional
Units and purchases that would violate transfer restrictions contained in the
Partnership's Amended and Restated Agreement of Limited Partnership
("Partnership Agreement").
5
<PAGE>
In the event that proration is required, because of the difficulty of
immediately determining the precise number of Units to be accepted, the
Purchaser will announce the final results of proration as soon as practicable,
but in no event later than five to ten business days following the Expiration
Date. Subject to the Purchaser's obligations under Rule 14e-1(c) under the
Exchange Act to pay Unit Holders the Purchase Price in respect of Units tendered
or to return those Units promptly after termination or withdrawal of the Offer,
the Purchaser will not pay for any Units tendered until after the final
proration results have been determined.
Upon the terms and subject to the conditions of the Offer (including, if
the Offer is extended or amended, the terms and conditions of any extension or
amendment), the Purchaser will accept for payment, and will pay for, Units
validly tendered and not withdrawn in accordance with Section 4 below, as
promptly as practicable following the Expiration Date. Upon written
notification by the Partnership that the Units purchased by the Purchaser have
been approved for transfer to it or that the selling Unit Holder's address has
been changed to Purchaser's address, the Purchaser will pay for the Units. In
all cases, payment for Units purchased pursuant to the Offer will be made only
after the Expiration Date and timely receipt by the Purchaser of a properly
completed and duly executed Agreement of Sale and any other documents required
by the Agreement of Sale.
For purposes of the Offer, the Purchaser shall be deemed to have accepted
for payment (and thereby purchased) tendered Units when, as and if the Purchaser
gives oral or written notice to the Depositary of the Purchaser's acceptance
for payment of such Units pursuant to the Offer. Upon the terms and subject to
the conditions of the Offer, payment for Units purchased pursuant to the Offer
will in all cases be made by the deposit of the Purchase Price with the
Depositary who will act as agent for the purpose of receiving payment from the
Purchaser and transmitting payment to the tendering Unit Holders. Under no
circumstances will interest be paid on the Purchase Price for any Unit by reason
of any delay in making such payment.
If any tendered Units are not purchased for any reason, the Agreement of
Sale with respect to such Units not purchased will be of no force or effect. If,
for any reason whatsoever, acceptance for payment of, or payment for, any Units
tendered pursuant to the Offer is delayed, then, without prejudice to the
Purchaser's rights under Section 13 (but subject to compliance with Rule
14e-1(c) under the Exchange Act), the Purchaser may retain tendered Units,
subject to any limitations of applicable law, and such Units may not be
withdrawn except to the extent that the tendering Unit Holders are entitled to
withdrawal rights as described in Section 4.
If, prior to the Expiration Date, the Purchaser shall increase the
consideration offered to Unit Holders pursuant to the Offer, such increased
consideration shall be paid for all Units accepted for payment pursuant to the
Offer, whether or not such Units were tendered prior to such increase.
The Purchaser reserves the right to transfer or assign, at any time and
from time to time, in whole or in part, to one or more affiliates or direct or
indirect subsidiaries of the Purchaser, the right to purchase Units tendered
pursuant to the Offer, but no such transfer or assignment will relieve the
Purchaser of its obligations under the Offer or prejudice the rights of
tendering Unit Holders to receive payment for Units validly tendered and
accepted for payment pursuant to the Offer.
6
<PAGE>
SECTION 3. PROCEDURES FOR TENDERING UNITS.
VALID TENDER. For Units to be validly tendered pursuant to the Offer, a
properly completed and duly executed Agreement of Sale must be received by the
Purchaser at its address set forth on the back cover of this Offer to Purchase
on or prior to the Expiration Date. A Unit Holder may tender any or all Units
owned by such Unit Holder.
In order for a tendering Unit Holder to participate in the Offer, Units
must be validly tendered and not withdrawn prior to the Expiration Date, which
is 12:00 midnight, Eastern Time, on March 2, 1999.
Although the Purchaser has included a pre-addressed envelope with this
Offer for the convenience of Unit Holders, the method of delivery of the
Agreement of Sale is at the option and sole risk of the tendering Unit Holder,
and the delivery will be deemed made only when actually received by the
Purchaser. If delivery is by mail, registered mail with return receipt requested
is recommended. In all cases, sufficient time should be allowed to ensure timely
delivery.
BACKUP FEDERAL INCOME TAX WITHHOLDING. To prevent the possible application
of backup federal income tax withholding with respect to payment of the Purchase
Price for Units purchased pursuant to the Offer, a tendering Unit Holder must
verify such Unit Holder's correct taxpayer identification number or social
security number, as applicable, and make certain certifications that the Unit
Holder is not subject to backup federal income tax withholding.
The Unit Holder is required to certify in the Agreement of Sale, under
penalties of perjury, that (i) the tax identification number shown on the
Agreement of Sale is the Unit Holder's correct taxpayer identification number;
and (ii) the Unit Holder is not subject to backup withholding either because the
Unit Holder has not been notified by the Internal Revenue Service (the "IRS")
that the Unit Holder is subject to backup withholding as a result of failure to
report all interest or dividends, or the IRS has notified the Unit Holder that
the Unit Holder is no longer subject to backup withholding.
The Unit Holder is also required to certify in the Agreement of Sale, under
penalties of perjury, that the Unit Holder, if an individual, is not a
nonresident alien for purposes of U.S. income taxation, and if not an
individual, is not a foreign corporation, foreign partnership, foreign trust, or
foreign estate (as those terms are defined in the Internal Revenue Code and
Income Tax Regulations). The Unit Holder understands that this certification
may be disclosed to the IRS by the Purchaser and that any false statements
contained herein could be punished by fine, imprisonment, or both.
TENDERS BY BENEFICIAL HOLDERS. Tenders of Units made by beneficial holders
of Units will be deemed an instruction to brokers, dealers, commercial banks,
trust companies, custodian and similar persons or entities whose names, or the
names of whose nominees, appear as the registered owner of such Units, to
tender such Units on behalf of such beneficial holder. A tender of Units can
only be made by the registered owner of such Units.
7
<PAGE>
SIGNATURE GUARANTEES. The signature(s) on the Agreement of Sale must be
Medallion guaranteed by a commercial bank, savings bank, credit union, savings
and loan association or trust company having an office, branch or agency in the
United States, a brokerage firm that is a member firm of a registered national
securities exchange or a member of the National Association of Securities
Dealers, Inc., as provided in the Agreement of Sale.
APPRAISAL RIGHTS. Unit Holders will not have any appraisal or dissenter's
rights with respect to or in connection with the Offer.
OTHER REQUIREMENTS. By executing and delivering the Agreement of Sale, a
tendering Unit Holder irrevocably appoints the Purchaser and/or designees of the
Purchaser and each of them as such Unit Holder's proxies, with full power of
substitution, in the manner set forth in this Agreement of Sale.
By executing and delivering the Agreement of Sale, a tendering Unit Holder
also irrevocably assigns to the Purchaser, and its assigns, all of the right,
title and interest, free and clear of all liens and encumbrances of any kind, of
such Unit Holder in the Partnership with respect to the Units tendered and
purchased pursuant to the Offer, including, without limitation, such Unit
Holder's right, title and interest in and to any and all Distributions made by
the Partnership after December 15,1998 in respect of the Units tendered by such
Unit Holder and accepted for payment by the Purchaser, regardless of the fact
that the record date for any such Distribution may be a date prior to December
15,1998. The Purchaser will seek to be admitted to the Partnership as an
Assignee and/or a substitute limited partner upon consummation of the purchase
of Unit Holder's Units pursuant to the Offer and it is the intention of the Unit
Holder that upon consummation of the purchase of Unit Holder's Units pursuant to
the Offer that the Purchaser succeed to the Unit Holder's interest as an
assignee and/or a substitute limited partner of the Partnership in such Unit
Holder's place.
By executing an Agreement of Sale as set forth above, a tendering Unit
Holder also agrees that notwithstanding any provisions of the Partnership's
Partnership Agreement which provide that any transfer is not effective until a
date subsequent to the date of any transfer of Units under the Offer, the
Purchase Price shall be reduced by any Distributions with respect to the Units
after December 15,1998.
DETERMINATION OF VALIDITY; REJECTION OF UNITS; WAIVER OF DEFECTS; NO
OBLIGATION TO GIVE NOTICE OF DEFECTS. All questions as to the form of documents
and validity, eligibility (including time of receipt) and acceptance for payment
of any tender of Units will be determined by the Purchaser, in its sole
discretion, which determination will be final and binding on all parties. The
Purchaser reserves the absolute right to reject any or all tenders determined by
it not to be in proper form or the acceptance of or payment for which may, in
the opinion of the Purchaser or Purchaser's counsel, be unlawful. The Purchaser
also reserves the absolute right to waive any of the conditions of the Offer or
any defect or irregularity in any tender of Units of any particular Unit Holder
whether or not similar defects or irregularities are waived in the case of other
Unit Holders.
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<PAGE>
The Purchaser's interpretation of the terms and conditions of the Offer
(including the Agreement of Sale and the instructions thereto) will be final and
binding. No tender of Units will be deemed to have been validly made until all
defects and irregularities with respect to such tender have been cured or
waived. Neither the Purchaser nor any of its affiliates or assigns, if any, or
any other person will be under any duty to give any notification of any defects
or irregularities in tenders or incur any liability for failure to give any such
notification.
The Purchaser's acceptance for payment of Units tendered pursuant to any of
the procedures described above will constitute a binding agreement between the
tendering Unit Holder and the Purchaser upon the terms and subject to the
conditions of the Offer.
SECTION 4. WITHDRAWAL RIGHTS. Except as otherwise provided in this
Section 4, tenders of Units made pursuant to the Offer are irrevocable. Units
tendered pursuant to the Offer may be withdrawn at any time on or prior to
the Expiration Date and, unless previously accepted for payment as provided
herein, may also be withdrawn at any time after April 2, 1999 (or such later
date as may apply in case the Offer is extended).
If, for any reason whatsoever, acceptance for payment of any Units tendered
pursuant to the Offer is delayed, or the Purchaser is unable to accept for
payment or pay for Units tendered pursuant to the Offer, then, without prejudice
to the Purchaser's rights set forth herein, the Purchaser may retain tendered
Units and such Units may not be withdrawn, except to the extent that the
tendering Unit Holder is entitled to and duly exercises withdrawal rights as
described in this Section 4. Any such delay will be by an extension of the Offer
to the extent required by law.
In order for a withdrawal to be effective, a written notice of withdrawal
must be timely received by the Depositary at its address set forth on the last
page of this Offer to Purchase. Any such notice of withdrawal must specify the
name of the person who tendered the Units to be withdrawn, with the signature of
such person Medallion guaranteed in the same manner as the signature in the
Agreement of Sale, the number of Units to be withdrawn, and (if the Agreement of
Sale has been delivered) the name of the Unit Holder as set forth in the
Agreement of Sale. Withdrawals of Units may not be rescinded. Any Units properly
withdrawn will be deemed not validly tendered for purposes of the Offer, but may
be retendered at any subsequent time prior to the Expiration Date by following
any of the procedures described in Section 3.
All questions as to the form and validity (including time of receipt) of
notices of withdrawal will be determined by the Purchaser, in its sole
discretion, whose determination will be final and binding. Neither the Purchaser
nor any of its affiliates or assigns, if any, or any other person will be under
any duty to give any notification of any defects or irregularities in any notice
of withdrawal or incur any liability for failure to give any such notification.
SECTION 5. EXTENSION OF TENDER PERIOD; TERMINATION; AMENDMENT. The
Purchaser expressly reserves the right, in its sole discretion, at any time and
from time to time, (i) to extend the period of time during which the Offer is
open and thereby delay acceptance for payment of, and the payment for, any Units
by giving oral or written notice of such extension, (ii) to terminate the Offer
9
<PAGE>
at any time from any or no reason and not accept for payment any Units not
theretofore accepted for payment or paid for, by giving oral or written notice
of such termination. (iii) upon the failure to satisfy any of the conditions
specified in Section 13, to delay the acceptance for payment of, or payment for,
any Units not heretofore accepted for payment or paid for, by giving oral or
written notice of such termination or delay, and (iv) to amend the Offer in any
respect (including, without limitation, by increasing or decreasing the
consideration offered or the number of Units being sought in the Offer or both)
by giving oral or written notice of such amendment. Any extension, termination
or amendment will be followed as promptly as practicable by public announcement,
the announcement in the case of an extension to be issued no later than 9:00
a.m., Eastern Time, on the next business day after the previously scheduled
Expiration Date, in accordance with the public announcement requirement of Rule
14e-1(d) under the Exchange Act.
If the Purchaser makes a material change in the terms of the Offer or the
information concerning the Offer or waives a material condition of the Offer,
the Purchaser will extend the Offer to the extent required by Rules 14d-4(c) and
14d-6(d) under the Exchange Act. The minimum period during which an offer must
remain open following a material change in the terms of the offer or of
information concerning the offer, other than a change in price or a change in
percentage of securities sought, will depend upon the facts and circumstances,
including the relative materiality of the change in the terms or information.
With respect to a change in price or a change in percentage of securities sought
(other than an increase of not more than 2% of the securities sought), however,
a minimum ten business day period is generally required to allow for adequate
dissemination to security holders and for investor response. As used in this
Offer, "business day" means any day other than a Saturday, Sunday or a federal
holiday, and consists of the time period from 12:01 a.m. through 12:00 midnight,
Eastern Time.
SECTION 6. CERTAIN TAX CONSEQUENCES.
UNIT HOLDERS SHOULD CONSULT THEIR RESPECTIVE TAX ADVISORS AS TO THE
PARTICULAR TAX CONSEQUENCES TO EACH SUCH UNIT HOLDER OF SELLING UNITS PURSUANT
TO THE OFFER.
SECTION 7. PURPOSE AND EFFECTS OF THE OFFER.
PURPOSE OF THE OFFER. The Purchaser is making the Offer for investment
purposes only (See Section 8 -- "Future Plans") with a view towards making a
profit. The Purchaser's intent is to acquire the Units at a discount to the
value that the Purchaser might ultimately realize from owning the Units.
The Offer is being made by the Purchaser as a speculative investment based
upon the belief that the Units represent an attractive investment at the price
offered based upon, in part, the remaining assets of the Partnership. The
purpose of the Offer is to allow the Purchaser to benefit from any one
combination of the following: (i) any cash distributions from Partnership
operations in the ordinary course of business; (ii) distributions, if any, of
net proceeds from the liquidation of
10
<PAGE>
any properties after the Partnership has satisfied its liabilities; (iii) any
cash from any redemption of the Units by the Partnership; and (iv) sale of
the Units.
The Purchaser established the Purchase Price of $1,000 per Unit based on a
number of factors, including (i) the prices of recent secondary market resales
of the Units; (ii) the illiquid nature of the investment; and (iii) the costs to
the Purchaser associated with acquiring the Units ("Factors").
The Purchase Price represents the price at which the Purchasers are willing
to purchase Units. No independent person has been retained by the Purchaser to
evaluate or render any opinion with respect to the fairness of the Purchase
Price to the Seller's and no representation is made as to such fairness. The
Purchaser urges those Unitholders that are considering tendering their Units
pursuant to the Offer to first consult with their own advisors (e.g., tax,
financial) in evaluating the terms of the Offer before deciding whether or not
to tender Units.
The Purchaser is offering to purchase Units which are a relatively illiquid
investment and are not offering to purchase the Partnership's underlying assets.
Consequently, the Purchaser does not believe that the underlying asset value of
the Partnership is determinative in arriving at the Purchase Price.
Nevertheless, using publicly available information concerning the Partnership
contained in the Partnership's Annual Report on Form 10-K for the year ended
December 31, 1997, the Purchaser used an estimated asset value to derive an
estimated market value for the Units solely for purposes of formulating their
Offer.
In determining their estimated value of the Units, the Purchaser first
calculated the estimated current net operating income in accordance with the
Partnership's financial statements. Then, in consideration of the Factors
discussed above, the Purchaser determined the appropriate capitalization rate
for the Partnership's net operating income. The resulting net asset value of
the Partnership's properties was added to the Partnership's net current assets
and the Partnership's total estimated asset value was then reduced by the
Purchaser's estimate of the hypothetical costs to liquidate the portfolio plus
the Purchaser's estimated acquisition and transfer costs.
Other measures of value may be relevant to a Unit Holder and all Unit
Holders are urged to carefully consider all of the information contained in the
Offer to Purchase and Agreement of Sale and to consult with their own advisors
(tax, financial or otherwise) in evaluating the terms of the Offer before
deciding whether to tender Units. The Offer is being made as a speculative
investment by the Purchaser based on its belief that there is inherent
underlying value in the assets of the Partnership.
The General Partner disclosed in its Annual Report on Form 10-K for the
year ended December 31, 1997 filed with the Commission in March, 1998 (the "1997
10-K"), the following information with regard to restrictions on transfer of
Units:
"There is no public market for the Units, and it is not anticipated
that a public market for the Units will develop. The transfer of
Units, or any interest therein, is subject to a variety of
restrictions. Limited Partners may not transfer their interests in
the
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<PAGE>
Partnership if, in the opinion of the Partnership's counsel, such
transfers might violate the registration requirements of the
Securities Act of 1933, as amended, or the laws of any other
jurisdiction or agency applicable to the transfers, cause the
Partnership to be regarded as an association taxable as a corporation,
result in the dissolution or termination of the Partnership or result
in a Hotel Partnership's not being able to obtain or continue in
effect any license permitting the service or sale of alcoholic
beverages in its Hotel. The assignee must also meet certain other
requirements set forth in the Amended and Restated Agreement of
Limited Partnership of Westin Hotels Limited Partnership before it may
be recognized as a substituted Limited Partner, including the payment
of all reasonable expenses connected with the transfer of any
interest. The limited partners or their representatives must furnish,
as to voluntary transfers, sufficient information to counsel to permit
the foregoing determination to be made.
"The General Partner is aware of certain transfers of Units between
unrelated parties, some of which do occur through certain secondary
markets that specialize in trading limited partnership interests ("Limited
Partnership Exchanges"). Initially, because these transactions were limited
and sporadic in number and volume, it had been the General Partner's policy
not to disclose the prices at which Units were transferred. Around July
1996, in response to direct requests for Unit sales price and value
estimates, the General Partner began advising individuals that Unit
exchange sales were occurring on Limited Partnership Exchanges and
providing those individuals with the names of Limited Partnership Exchanges
and other sources to contact for exchange trading price information.
"In 1996, 1997, and more recently, in 1998, the General Partner became
aware of offers to purchase Units, which were mailed to limited partners,
that have ranged from $185 to $700 per Unit. The General Partner responded,
without recommending either an acceptance or rejection of any offer, by
providing the limited partners with certain information concerning reported
Unit sales. The following information reflects the Partnership's records of
the average and range of Unit sale prices to date:
<TABLE>
<CAPTION>
" Average per Unit Range of per Unit Sale
Sales Price Sales Price
---------------------- ----------------- ----------------------
<S> <C> <C>
1996: First Quarter $201.63 $120.00 to $215.34
Second Quarter $242.32 $150.12 to $269.00
Third Quarter $315.81 $204.50 to $347.00
Fourth Quarter $363.84 $340.00 to $387.60
1997: First Quarter $505.93 $320.00 to $624.75
12
<PAGE>
Second Quarter $530.37 $400.00 to $590.00
(through April 21, when sales were suspended)
1998: First Quarter $733.01 $545.00 to $890.00
(through March 21, 1998)
</TABLE>
"In October 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 interests in
partnership capital or profits represented by Units traded during any
calendar year does not exceed 5% of the total Partnership interests. On
April 21, 1997, upon reaching 1997 Unit sales aggregating 6,848, the
General Partner suspended its approval of any Unit sales transfer requests
in order to comply with the 5% safe harbor. The Partnership has already
received transfer requests for 6,514 Unit sales for the first quarter of
1998. When the Partnership reaches 1998 Unit sales aggregating 6,848, the
General Partner will suspend its approval of any Unit sales transfer
requests for the remainder of 1998."
Purchaser believes that Units purchased pursuant to a tender offer pursuant
to Schedule 14D-1 filed would not violate the publicly traded partnership rules.
Further, the Partnership agreed in writing to change the address on the records
of the Partnership from Seller to Purchaser, which the Partnership has done for
the Purchaser's prior offers. (See Section 9 - "Past Contacts and Negotiation
With General Partner").
In determining the number of Units for which the Offer is made
(representing approximately 3.6% of the outstanding Units), the Purchaser took
these restrictions into account and has conditioned the Offer on not violating
such restrictions. See "Tender Offer--Section 13. Certain Conditions of the
Offer." The foregoing are hereafter referred to as the "Transfer Restrictions."
EFFECT ON TRADING MARKET AND PRICE RANGE OF THE UNITS. If a substantial
number of Units are purchased pursuant to the Offer, the result will be a
reduction in the number of Unit Holders. In the case of certain kinds of equity
securities, a reduction in the number of security-holders might be expected to
result in a reduction in the liquidity and volume of activity in the trading
market for the security. In this case, however, there is a limited trading
market for the Units and, therefore, the Purchaser does not believe a reduction
in the number of Unit Holders will materially further restrict the Unit Holders'
ability to find purchasers for their Units.
The Partnership disclosed in its 1997 10-K that there is no public market
for the Units, and it is not anticipated that a public market will develop.
The Units are registered under Section 12(g) of the Exchange Act, which
means, among other things, that the Partnership is required to file periodic
reports with the Commission and to comply with the Commission's proxy rules. The
Purchaser does not expect or intend that consummation of
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<PAGE>
the Offer will cause the Units to cease to be registered under Section 12(g)
of the Exchange Act. Currently, there are approximately 8,284 Unit Holders.
If the Units were to be held by fewer than 300 persons, the Partnership could
apply to de-register the Units under the Exchange Act. Because the Units are
widely held, however, the Purchaser expects that even if it purchases the
maximum number of Units in the Offer, after that purchase the Units will be
held of record by substantially more than 300 persons.
Partnership Spectrum, a third party publication reported that during the
period September 1, 1998 through October 31, 1998 that trades at an average
weighted price of $925 per Unit, encompassing 480 Units, took place. Such
secondary market selling prices, however, do not take into account commissions
charged by secondary market makers effectuating such sales which the Purchaser
believes, based on a typical ten Unit sales transaction, range from 5% to 8% of
the sales proceeds (which would result in a reduction of net proceeds to the
seller of approximately $462 to approximately $740).
The successful purchase of 3.6% of the outstanding Units by the Purchaser
will cause the Purchaser to own approximately 9.9% of the outstanding Units.
The Purchaser may then be a position to exert a strong influence upon the
General Partner and the operation of the Partnership.
SECTION 8. FUTURE PLANS. The Purchaser is acquiring the Units pursuant to
the Offer for investment purposes only, has no current intentions to change
current management or operations of the Partnership and has no current plans for
any extraordinary transactions involving the Partnership.
The Purchaser believes that current market conditions are such that a sale
of the Partnership's properties would be in the best interests of the Unit
Holders. Purchaser has sought, and may in the future seek, to encourage the
Partnership to have the Partnership's properties sold and have the Partnership
liquidated and dissolved. If the Partnership does not sell the hotels in a
timely manner, the Purchaser may seek to force a vote of Unit Holders to sell
the hotels, or remove the General Partner, and elect a new general partner who
will sell the hotels. See Section 9 ("Past Contacts and Negotiations with
General Partner").
The Purchaser and its affiliates may acquire additional Units through
private purchases, one or more future tender offers or by any other means deemed
advisable. Such future purchases will also be for investment purposes only and
may be at prices higher or lower than the Purchase Price.
14
<PAGE>
SECTION 9. PAST CONTACTS AND NEGOTIATIONS WITH GENERAL PARTNER.
Purchaser first requested the list of Limited Partners of the Partnership
in August 1996, and received the list of Limited Partners from the Partnership
in a timely manner. From October 1996 to June 1998 Purchaser has had
continuous discussions by telephone, letter, and memorandum with the Partnership
pursuant to matters pertaining to the transfer of Units from sellers to
Purchaser, including the applicability of the "publicly traded partnership" tax
rules regarding transfers. As a result of such communications, the Partnership
has agreed to cause the address of the sellers of Units to the Purchaser to
change the seller's address to the Purchaser's address, which the Partnership
has done in connection with certain of the sellers' Units acquired by Purchaser
as a result of prior offers described below.
Purchaser, pursuant to seven separate limited tender offers and one tender
offer filed with the Commission on Schedule 14D-1 (the "14D-1 Offer"), acquired
a total of 8,475 Units, which is approximately 6.25% of the issued and
outstanding Units of the Partnership. On September 18, 1996, Purchaser
commenced the first limited tender offer for 6,780 Units at a price of $230 per
Unit, pursuant to which Purchaser acquired 3,092 Units, which offer expired on
November 26, 1996. On February 18, 1997, Purchaser commenced a second limited
tender offer for an additional 3,497 Units at a purchase price of $310 per Unit,
pursuant to which Purchaser acquired 384 Units, which offer expired on March 20,
1997. Purchaser commenced a third limited tender offer on June 2, 1997 for an
additional 3,233 Units at a purchase price of $450 per Unit, pursuant to which
Purchaser acquired 733 Units, which offer expired on July 3, 1997. On August
12, 1997, Purchaser commenced its fourth limited tender offer for an additional
2,435 Units at a purchase price of $550 per Unit, pursuant to which Purchaser
acquired 281 Units, which offer expired on September 17, 1997. Purchaser
commenced its fifth limited tender offer on October 17, 1997 for an additional
2,119 Units at a purchase price of $650 per Unit, pursuant to which Purchaser
acquired 754 Units which offer expired on November 18, 1997. On January 30,
1998, Purchaser commenced a sixth limited tender offer for an additional 1,399
Units at a purchase price of $700 per Unit, pursuant to which Purchaser acquired
990 Units which offer expired on February 27, 1998. Purchaser commenced its
final limited tender offer on April 15, 1998 for an additional 530 Units at a
purchase price of $750 per Unit, pursuant to which purchaser acquired 515 Units,
which offer expired on May 15, 1998. Purchaser commenced the 14D-1 Offer on
December 16, 1998 for an additional 6,500 Units at a purchase price of 1,000 per
Unit, pursuant to which Purchaser acquired 1,726 Units. The 14D-1 Offer expired
on January 18, 1998.
In the fall of 1997, Purchaser contacted the General Partner by telephone
to determine whether the General Partner might have any interest in purchasing
the Units owned by Purchaser in the Partnership. The General Partner indicated
that they had an interest but they had a major tax problem to overcome in that
the General Partner was now owned by Starwood Hotels and Resorts Trust
("Starwood") which was a "Paired-Share" Real Estate Investment Trust ("REIT")
and had received special tax benefits by reason of being a Paired-Share REIT.
There was a very legitimate concern as to whether or not they could purchase
Purchaser's Units. The tax lawyers retained by Purchaser and the tax lawyers
for Starwood were never able to come to the opinion that Starwood
15
<PAGE>
could acquire Purchaser's Units without jeopardizing their Paired-Share
status. As a result, negotiations for any possible purchase of the Units
were terminated.
On November 5, 1998, Purchaser sent a letter to the Unit Holders (a copy of
which was sent to the General Partner of the Partnership) seeking the Unit
Holder's consent to request the Partnership to cause a vote of the Unit Holders
to sell the Partnership's hotels. Unit Holder's in excess of [ ]% of the Units
agree to join Purchaser in such request. As a result of such letter and
telephone conversations between the Purchaser and the General Partner, the
Purchaser was advised in a telephone conversation with the General Partner on
November 19, 1998 that the General Partner will cause the partnership to
immediately proceed with the sale of the hotels and that within two to three
weeks from that date the General Partner will send the Unit Holder a letter to
that effect. Because of the General Partners anticipated action to sell the
hotels, the request to the General Partners to commence such a consent
solicitation has not been formally made. If the sale of the hotels is not
commenced, the Purchaser will seek to have the General Partner cause a vote of
Unit Holders to sell the hotels and/or remove the General Partner of the
Partnership. See Section 8. ("Future Plans").
On November 19, 1998, Purchaser, provided the General Partner with the name
of a potential purchaser of Partnership's hotels.
During the period January 11, 1999 and January 29, 1999, representatives of
the Purchaser and the Partnership discussed the providing of a legal opinion
regarding the transfer of the Units Purchaser acquired in its 14D-1 Offer. Such
discussions are ongoing.
SECTION 10. CERTAIN INFORMATION CONCERNING THE BUSINESS OF THE PARTNERSHIP
AND RELATED MATTERS.
BUSINESS. The following information was extracted from the Partnership's
1997 10-K, the Quarterly Report on Form 10-Q for the nine-month period ended
September 30, 1997 and Current Reports on Form 8-K filed during 1998
(collectively the "Reports"), which Reports were filed with the Commission. The
Purchaser did not prepare any of the information contained in such reports and
extracted in this Offer and the Purchaser makes no representation as to the
accuracy or completeness of such information.
The Partnership was organized on April 25, 1986 under the laws of Delaware. The
Partnership is engaged solely in the business of owning and operating hotels.
The Partnership's business offices are located at 2231 East Camelback Road,
Suite 400, Phoenix, Arizona 85106-3435.
The General Partner disclosed is its 1997 10-K that:
"On January 2, 1998, Starwood Hotels & Resorts Trust (the "Trust"), a real
estate investment trust, whose shares are paired and trade together as a unit
with Starwood Hotels & Resorts Worldwide, Inc. (the "Corporation"), a hotel
management and operating company, completed the merger of Westin Hotels &
Resorts Worldwide, Inc. ("Westin Worldwide"). Effective upon closing
16
<PAGE>
of the Westin Worldwide merger, the Trust's and Corporation's names were
changed to Starwood Hotels & Resorts Trust and Starwood Hotels & Resorts
Worldwide, Inc., respectively. The Trust was renamed Starwood Hotels &
Resorts on February 24, 1998. The Trust and Corporation together are referred
to as "Starwood". This transaction was pursuant to the Transaction Agreement,
dated as of September 8, 1997, among WHWE L.L.C., a Delaware limited
liability company, Woodstar Investor Partnership, a Delaware general
partnership, Nomura Asset Capital Corporation, a Delaware corporation,
Juergen Bartels, W&S Hotel L.L.C., a Delaware limited liability company,
Westin Hotels & Resorts Worldwide, Inc., a Delaware corporation, W&S
Lauderdale Corp., a Delaware corporation, W&S Seattle Corp., a Delaware
corporation, Westin St. John Hotel Company, Inc., a United States Virgin
Islands corporation, W&S Denver Corp., a Delaware corporation, W&S Atlanta
Corp., a Delaware corporation, Starwood Lodging Trust, a Maryland real estate
investment trust, SLT Realty Limited Partnership, a Delaware limited
partnership, Starwood Lodging Corporation, a Maryland corporation and SLC
Operating Limited Partnership, a Delaware limited partnership ("Transaction
Agreement").
"Pursuant to the Transaction Agreement, Westin Worldwide, including its
wholly owned subsidiary Westin Hotel Company, were merged with and into the
Trust and the separate corporate existence of Westin Worldwide and Westin Hotel
Company thereupon ceased. Westin Realty, St. Francis Corp., and 909 Corp., each
formerly wholly owned subsidiaries of Westin Hotel Company, are now wholly owned
subsidiaries of the Corporation. The merger does not change the structure of the
General Partner's and limited partners' ownership interest in either the
Partnership or the Hotel Partnerships. Moreover, none of the owners of Starwood
have any beneficial ownership in the Partnership as a limited partner.
"In conjunction with the merger, Westin Hotel Company assigned the
management agreements for The Westin St. Francis Hotel to St. Francis Corp. and
for The Westin Michigan Avenue, Chicago to 909 Corp. The Hotels continue to be
managed as full-service Westin hotels and operated as part of the Westin
international hotel system.
"On February 24, 1998, the Corporation acquired ITT Corporation, creating a
preeminent global hotel company with 650 hotels in 70 countries. This
transaction was pursuant to the Amended and Restated Agreement and Plan of
Merger dated as of November 12, 1997, among Starwood Lodging Corporation, a
Maryland corporation ("Parent"), Chess Acquisition Corp., a Nevada corporation
and a controlled subsidiary of Parent, Starwood Lodging Trust, a Maryland real
estate investment trust and ITT Corporation, a Nevada corporation. Because the
Corporation and its affiliates own and/or operate hotels other than those owned
by the Partnership, potential conflicts of interest exist. While the Corporation
and its officers have the right to compete with the Hotels, including the right
to own, operate and develop competing hotels, the General Partner is under a
fiduciary duty to conduct the affairs of the Partnership and consequently must
exercise good faith and integrity in handling Partnership affairs."
"When the Partnership was formed in 1986, it was anticipated that a sale or
refinancing of the Hotels would be explored after eight years of Partnership
operations. Beginning with 1994, the Partnership agreement directed the General
Partner to actively review opportunities to sell
17
<PAGE>
or refinance the Hotel properties on behalf of the Partnership. During 1994
the General Partner emphasized restructuring the debt to stabilize both
Hotels and to allow them to remain competitive in their respective markets.
The General Partner will review the opportunities to sell or refinance the
Hotel properties when it reasonably believes that such action is in the best
interest of the Partnership. As the real estate market for upscale hotel
properties continues to improve, the General Partner will monitor the market
conditions for appropriate opportunities to sell or refinance the properties.
By the end of 2001, the General Partner must use its best efforts to sell or
refinance the Hotel properties."
DISTRIBUTIONS. The Partnership disclosed in its 1997 10-K, that it made
distributions as follows:
<TABLE>
<CAPTION>
Year Ending Distributions Per
December 31 Unit
----------- -----------------
<S> <C>
1995 $-0-
1996 $-0-
1997 $95.00
</TABLE>
The Partnership's General Partner in a letter dated November 3, 1998 to
limited partners stated "The total planned distribution for 1998 is $95 per
Unit."
Set forth below is a summary of certain financial information with respect
to the Partnership, which has been excerpted or derived from the Partnership's
1997 10-K Quarterly Report on Form 10-Q for the Quarterly Period ended September
30, 1998. More comprehensive financial and other information is included in
such reports and other documents filed by the Partnership with the Commission,
and the following summary is qualified in its entirety by reference to such
reports and other documents and all the financial information and related notes
contained therein. Such reports and other documents may be examined and copies
may be obtained from the offices of the Commission at the addresses set forth in
the "Introduction." The Purchaser disclaims any responsibility for the
information included in such reports and documents, and extracted in this Offer
to Purchase.
18
<PAGE>
Selected Financial Information
(In Thousands of Dollars, Except Per Unit Amounts)
<TABLE>
<CAPTION>
Fiscal Year Fiscal Year Fiscal Year
Ended 12/31/97 Ended 12/31/96 Ended 12/31/95
-------------- -------------- --------------
<S> <C> <C> <C>
Operating Profit $ 22,459 $19,899 $13,994
Net Income $ 9,691 $ 6,978 $ 1,713
Net Income per Unit $ 71.47 $ 51.46 $ 12.63
Balance Sheet Data (in As of As of As of
thousands): 12/31/97 12/31/96 12/31/95
-------- -------- --------
Total Assets $269,785 $263,148 $246,698
Total Liabilities $200,862 $191,199 $181,859
Total Partners Equity $ 65,190 $ 68,381 $ 61,403
Units Outstanding 135,600 135,600 135,600
</TABLE>
19
<PAGE>
Nine Months Ended
(Dollars in Thousands, Except Per Unit Amounts)
(Unaudited)
<TABLE>
<CAPTION>
September 30, 1998 September 30, 1997
------------------ ------------------
<S> <C> <C>
Operating Profit $ 21,820 $ 15,977
Net Income $ 12,047 $ 6,456
Net Income per Unit $ 88.84 $ 47.61
Total Assets $282,692 $269,369
Total Liabilities $211,211 $197,290
Total Partner's Equity $ 67,576 $ 68,396
Units Outstanding 135,600 135,600
</TABLE>
The foregoing summary is qualified in its entirety by reference to such
Reports and all of the financial information and related notes contained
therein.
For information concerning the properties owned by the Partnership, please
refer to Schedule 2 attached hereto, which is incorporated herein by reference.
SECTION 11. CERTAIN INFORMATION CONCERNING THE PURCHASER.
The Purchaser is a Delaware Limited Liability Company which was organized
for the purpose of acquiring the Units in the Partnership. The Manager of the
Purchaser is Arlen Capital, LLC, a California limited liability company ("AC"),
which is controlled by its two members, Don Augustine and Lynn T. Wells. AC is
engaged in financial and business consulting, and making opportunistic
investments which include making tender offers on public and private real estate
limited partnerships. The Purchaser's and AC's offices are located at 1650
Hotel Circle North, Suite 200, San Diego, California 92108. For certain
information concerning the members of AC, see Schedule 1 to this Offer to
Purchase. The Purchaser owns 8,475 Units which is approximately 6.25% of the
issued and outstanding Units.
Except as otherwise set forth herein, (i) neither the Purchaser nor, to the
best knowledge of the Purchaser, any of the persons listed on Schedule 1, or any
affiliate of the Purchaser beneficially
20
<PAGE>
owns or has a right to acquire any Units; (ii) neither the Purchaser nor, to
the best knowledge of the Purchaser, any of the persons listed on Schedule 1,
or any affiliate of the Purchaser or any member, director, executive officer,
or subsidiary of any of the foregoing has effected any transaction in the
Units; (iii) neither the Purchaser nor, to the best knowledge of the
Purchaser, any of the persons listed on Schedule 1 or any affiliate of the
Purchaser has any contract, arrangement, understanding, or relationship with
any other person with respect to any securities of the Partnership, including
but not limited to, contracts, arrangements, understandings, or relationships
concerning the transfer or voting thereof, joint ventures, loan or option
arrangements, puts or calls, guarantees of loans, guarantees against loss, or
the giving or withholding of proxies, consents, or authorizations; (iv) there
have been no transactions or business relationships which would be required
to be disclosed under the rules and regulations of the SEC between any of the
Purchasers, or, to the best knowledge of the Purchaser, any of the persons
listed on Schedule 1 or any affiliate of the Purchaser, on the one hand, and
the Partnership or affiliates, on the other hand; and (v) there have been no
contracts, negotiations, or transactions between the Purchaser or to the best
knowledge of the Purchaser, any of the persons listed on Schedule 1 or any
affiliate of the Purchaser, on the one hand, and the Partnership or its
affiliates, on the other hand, concerning a merger, consolidation or
acquisition, tender offer (other than as described in Section 8 of this
Offer) or other acquisition of securities, an election or removal of the
General Partner, or a sale or other transfer of a material amount of assets.
SECTION 12. SOURCE OF FUNDS. The Purchaser expects that approximately
$4,900,000 (exclusive of fees and expenses) will be required to purchase 4,900
Units (approximately 3.6% of the 135,600 Units outstanding), if tendered. The
Purchaser is not a public company. The Offer is not contingent on obtaining
financing.
SECTION 13. CERTAIN CONDITIONS OF THE OFFER. Notwithstanding any other
provisions of the Offer, the Purchaser will not be required to accept for
payment or, subject to any applicable rules or regulations of the Commission,
including Rule 14e-1(c) under the Exchange Act (relating to the Purchaser's
obligation to pay for or return tendered Units promptly after the expiration or
termination of the Offer), to pay for any Units tendered, and may postpone the
acceptance for payment or, subject to the restriction referred to above, payment
for any Units tendered, and may amend or terminate the Offer if (i) the
Purchaser shall not have confirmed to its reasonable satisfaction that, upon
purchase of the Units pursuant to the Offer, the Purchaser will have full rights
to ownership as to all such Units and that the Purchaser will become a
registered owner on the books and records of the Partnership, (ii) the Purchaser
shall not have confirmed to its reasonable satisfaction that, upon the purchase
of the Units pursuant to the Offer, the Transfer Restrictions will have been
satisfied, or (iii) all authorizations, consents, orders or approvals of, or
declarations or filings with, or expirations of waiting periods imposed by, any
court, administrative agency or commission or other governmental authority or
instrumentality, domestic or foreign, necessary for the consummation of the
purchase contemplated by the Offer shall not have been filed, occurred or been
obtained. Furthermore, notwithstanding any other term of the Offer, the
Purchaser will not be required to accept for payment or pay for any Units not
theretofore accepted for payment or paid for and may terminate or amend the
Offer as to such Units if, at any time on or after the date of the Offer and
before the Expiration Date any of the following conditions exist:
21
<PAGE>
(a) the acceptance by the Purchaser of Units tendered and not withdrawn
pursuant to the Offer or the transfer of such Units to the Purchaser violates
restrictions in the Partnership Agreement which prohibit any transfer of Units
which would cause a termination of the Partnership or would cause the
Partnership to be taxed as a "publicly traded partnership" under the Internal
Revenue Code;
(b) there shall have been threatened, instituted or pending any action or
proceeding before any court or governmental agency or other regulatory or
administrative agency or commission or by any other person, challenging the
acquisition of any Units pursuant to the Offer or otherwise directly or
indirectly relating to the Offer, or otherwise, in the judgment of the
Purchaser, adversely affecting the Purchaser or the Partnership;
(c) any statute, rule or regulation shall have been proposed, enacted,
promulgated or deemed applicable to the Offer, or any action or order shall have
been proposed, entered into or taken, by any government, governmental agency, or
other regulatory or administrative agency or authority, which, in the judgment
of the Purchaser, might (i) result in a delay in the ability of the Purchaser or
render the Purchaser unable, to purchase or pay for some or all of the tendered
Units, (ii) make such purchase or payment illegal, or (iii) otherwise adversely
affect the Purchaser or the Partnership;
(d) any change shall have occurred or be threatened in the business,
financial condition, results of operations, tax status or prospects of the
Partnership which, in the judgment of the Purchaser, is or may be adverse to the
Partnership, or the Purchaser shall have become aware of any facts which, in the
judgment of the Purchaser, have or may have adverse significance with respect to
the value of the Units;
(e) there shall have occurred (i) any general suspension of, or limitation
on prices for or trading in, securities in the over-the-counter market or on the
New York Stock Exchange, Inc., (ii) a declaration of a banking moratorium or any
suspension of payment in respect of banks in the United States or any limitation
by federal or state authorities on the extension of credit by lending
institutions or (iii) the commencement of a war, armed hostilities or other
international or national calamity directly or indirectly involving the United
States; or, in the case of any of the foregoing existing at the time of the
commencement of the Offer, a material acceleration or worsening thereof;
(f) a tender or exchange offer for some or all of the Units is made, or
publicly proposed to be made or amended, by another person;
(g) the Partnership shall have (i) issued, or authorized or proposed the
issuance of, any partnership interests of any class, or any securities
convertible into, or rights, warrants or options to acquire, any such interests
or other convertible securities, (ii) issued or authorized or proposed the
issuance of any other securities, in respect of, in lieu of, or in substitution
for, all or any of the presently outstanding Units, (iii) declared or paid any
distribution, OTHER THAN IN CASH, on any of its partnership interests, (iv)
authorized, proposed or announced its intention to propose any merger,
consolidation or business combination transaction, acquisition of assets,
disposition of assets or
22
<PAGE>
material change in its capitalization, or any comparable event not in the
ordinary course of business, or (v) proposed or effected any amendment to the
Partnership's Agreement of Limited Partnership;
(h) the failure to occur of any necessary approval or authorization by any
Federal or state authorities necessary to consummation of the Purchaser of all
or any part of the Units to be acquired hereby, which in the sole judgment of
the Purchaser in any such case, and regardless of the circumstances (including
any action of the Purchaser) giving rise thereto, makes it inadvisable to
proceed with such purchase or payment; or
(i) the Purchaser or any of its affiliates and the Partnership shall have
agreed that the Purchaser shall amend or terminate the Offer or postpone the
payment for the Units pursuant thereto.
The foregoing conditions are for the sole benefit of the Purchaser and its
affiliates and may be asserted by the Purchaser regardless of the circumstances
(including, without limitation, any action or inaction by the Purchaser or any
of its affiliates) giving rise to such condition, or may be waived by the
Purchaser, in whole or in part, from time to time in its sole discretion. The
failure by the Purchaser at any time to exercise the foregoing rights will not
be deemed a waiver of such rights, which rights will be deemed to be ongoing and
may be asserted at any time and from time to time. Any determination by the
Purchaser concerning the events described in this Section 13 will be final and
binding upon all parties.
23
<PAGE>
SECTION 14. CERTAIN LEGAL MATTERS AND REQUIRED REGULATORY APPROVALS.
GENERAL. Except as set forth in this Offer to Purchase, based on its review
of publicly available filings by the Partnership with the Commission and other
publicly available information regarding the Partnership, the Purchaser is not
aware of any licenses or regulatory permits that would be material to the
business of the Partnership, taken as a whole, and that might be adversely
affected by the Purchaser's acquisition of Units as contemplated herein, or any
filings, approvals or other actions by or with any domestic, foreign or
governmental authority or administrative or regulatory agency that would be
required prior to the acquisition of Units by the Purchaser pursuant to the
Offer as contemplated herein. Should any such approval or other action be
required, there can be no assurance that any such additional approval or action,
if needed, would be obtained without substantial conditions or that adverse
consequences might not result to the Partnership's business, or that certain
parts of the Partnership's or the Purchaser's business might not have to be
disposed of or held separate or other substantial conditions complied with in
order to obtain such approval. The Purchaser's obligation to purchase and pay
for Units is subject to certain conditions. See "Offer to Purchase -- Section
13. Certain Conditions of the Offer."
ANTITRUST. Under the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended (the "HSR Act"), and the rules and regulations that have been
promulgated thereunder by the Federal Trade Commission (the "FTC"), certain
acquisition transactions may not be consummated until certain information and
documentary material has been furnished for review by the Antitrust Division of
the Department of Justice (the "Antitrust Division") and the FTC and certain
waiting period requirements have been satisfied. The Purchaser does not
currently believe any filing is required under the HSR Act with respect to its
acquisition of Units contemplated by the offer.
Based upon an examination of publicly available information relating to the
business in which the Partnership is engaged, the Purchaser believes that the
acquisition of Units pursuant to the Offer would not violate the antitrust laws.
Nevertheless, there can be no assurance that a challenge to the Offer on
antitrust grounds will not be made, or, if such challenge is made, what the
result will be.
STATE TAKEOVER LAWS. The Purchaser has not attempted to comply with any
state takeover statutes in connection with the Offer. The Purchaser reserves the
right to challenge the validity or applicability of any state law allegedly
applicable to the Offer and nothing in the Offer, nor any action taken in
connection herewith, is intended as a waiver of that right. In the event that
any state takeover statute is found applicable to the Offer, the Purchaser might
be unable to accept for payment or purchase Units tendered pursuant to the Offer
or be delayed in continuing or consummating the Offer. In such case, the
Purchaser may not be obligated to accept for purchase, or pay for, any Units
tendered.
SECTION 15. FEES AND EXPENSES. The Purchaser will pay all expenses of the
Offer, including the fees and expenses of Arlen Capital, LLC, the Depositary.
The Purchaser will not pay any fees or commissions to any broker, dealer or
other person for soliciting tenders of Units pursuant to the
24
<PAGE>
Offer. Brokers, dealers, commercial banks and trust companies and other
nominees, if any, will, upon request and prior approval of the Purchaser, be
reimbursed by the Purchaser for reasonable and customary clerical and mailing
expenses incurred by them in forwarding materials to their customers.
SECTION 16. MISCELLANEOUS. THE OFFER IS NOT BEING MADE TO (NOR WILL
TENDERS BE ACCEPTED FROM OR ON BEHALF OF) UNIT HOLDERS IN ANY JURISDICTION IN
WHICH THE MAKING OF THE OFFER OR THE ACCEPTANCE THEREOF WOULD NOT BE IN
COMPLIANCE WITH THE LAWS OF SUCH JURISDICTION. THE PURCHASER IS NOT AWARE OF ANY
JURISDICTION WITHIN THE UNITED STATES IN WHICH THE MAKING OF THE OFFER OR THE
ACCEPTANCE THEREOF WOULD BE ILLEGAL.
In any jurisdiction where the securities, blue sky or other laws require
the Offer to be made by a licensed broker or dealer, the Purchaser will engage
one or more registered brokers or dealers that are licensed under the laws of
such jurisdiction to make the Offer. The Purchaser has filed with the
Commission the Schedule 14D-1, together with exhibits, pursuant to Rule 14d-3 of
the General Rules and Regulations under the Exchange Act, furnishing certain
information with respect to the Offer, and may file amendments thereto. Such
Schedule 14D-1 and any amendments thereto, including exhibits, may be examined
and copies may be obtained from the Commission as set forth above in
"Introduction."
No person has been authorized to give any information or to make any
representation on behalf of the Purchaser not contained in this Offer to
Purchase or in the Agreement of Sale and, if given or made, any such information
or representation must not be relied upon as having been authorized. Neither the
delivery of the Offer to Purchase nor any purchase pursuant to the Offer shall,
under any circumstances, create any implication that there has been no change in
the affairs of the Purchaser or the Partnership since the date as of which
information is furnished or the date of this Offer to Purchase.
Kalmia Investors, LLC
February 1, 1999
25
<PAGE>
SCHEDULE 1
INFORMATION REGARDING THE MANAGERS
OF ARLEN CAPITAL, LLC
Set forth in the table below are the names of the members of Arlen Capital,
LLC and their present principal occupations and five (5) year employment
histories. Each individual is a citizen of the United States and the business
address of each person is 1650 Hotel Circle North, Suite 200, San Diego,
California 92108.
<TABLE>
<CAPTION>
Present Principal Occupation or Employment
Name and Five-Year Employment History
- ----- -------------------------------------------
<S> <C>
Don Augustine Member and Manager of Arlen Capital LLC. President of Arlen
Capital, Inc., a California corporation, its predecessor
entity since 1989.
Lynn T. Wells Member and Manager of Arlen Capital LLC. Vice President of
Arlen Capital, Inc., a California corporation, its
predecessor entity since 1989.
</TABLE>
Arlen Capital, LLC and its predecessor entity, Arlen Capital, Inc. ("AC"),
have been providing business and financial consulting services since 1989. AC
principals have an extensive background in the capital markets, real estate
securities, and real estate markets. Commencing in 1996, AC and its affiliates
have been in the business of making opportunistic investments, which include a
number of tender offers on public and private real estate limited partnerships.
S-1-1
<PAGE>
SCHEDULE 2
HOTELS OWNED BY THE PARTNERSHIP
The following information on the Properties owned by the Partnership was
extracted from the Partnership's 1997 10-K.
The Partnership owns two Westin Hotels, The Westin St. Francis in San
Francisco, California, and The Westin Michigan Avenue, Chicago (formerly The
Westin Hotel, Chicago) in Chicago, Illinois.
The Westin St. Francis has 1,189 guest rooms, including 83 suites, with 610
rooms in the main building and 579 rooms in the 32-story tower, and 31 meeting
and banquet rooms. The Hotel has a full service restaurant, pub, and a night
club, and underground valet parking garage with 250 spaces.
The Westin Michigan Avenue, Chicago has 739 guest rooms, including 26
suites, and 19 meeting rooms. The Hotel operates a restaurant and bar, an
all-purpose food and beverage facility, a quick service coffee and snack kiosk,
and has underground parking garage with 209 spaces.
More comprehensive financial and other information is included in such
report and other documents filed by the Partnership with the Commission, and the
following is qualified by reference to such report and other documents. Such
report and other documents may be examined and copies may be obtained from the
offices of the Commission at the addresses set forth in the "Introduction"
section of the Offer to Purchase. The Purchaser disclaims any responsibility
for the information included in such report and documents, and extracted in this
Schedule 2, as well as any changes which may have taken place in the information
in the report since the date it was issued.
S-2-1
<PAGE>
Any questions or requests for assistance or for delivery of additional
copies of this Offer to Purchase or the Agreement of Sale may be directed to the
Depositary at the telephone number and address set forth below.
Arlen Capital, LLC
1650 Hotel Circle North, Suite 200
San Diego, California 92108
Telephone: 1-800-491-4105
<PAGE>
WESTIN HOTELS LIMITED PARTNERSHIP
AGREEMENT OF SALE
The undersigned Limited Partner, and/or Assignee Holder or Unit Holder (the
"Seller") does hereby sell, assign, transfer, convey and deliver (the "Sale") to
Kalmia Investors, LLC, a Delaware limited liability company ("Kalmia" or the
"Purchaser"), all of the Seller's right, title and interest in units of limited
partnership interests including any rights attributable to claims, damages,
recoveries, including recoveries from class action lawsuits, and causes of
action accruing to the ownership of such units of limited partnership interests
("Units") in Westin Hotels Limited Partnership (the "Partnership") being sold
pursuant to this Agreement of Sale ("Agreement") and the Offer to Purchase dated
February 1, 1999, (which together with this Agreement constitute the "Offer")
for a purchase price of $1,000 per Unit, less the amount of any distributions
declared or paid from any source by the Partnership with respect to the Units
after December 15, 1998, without regard to the record date or whether such
distributions are classified as a return on, or a return of, capital.
The Seller hereby represents and warrants to the Purchaser that the Seller owns
such Units and has full power and authority to validly sell, assign, transfer,
convey, and deliver to the Purchaser such Units, and that when any such Units
are accepted for payment by the Purchaser, the Purchaser will acquire good,
marketable and unencumbered title thereto, free and clear of all options, liens,
restrictions, charges, encumbrances, conditional sales agreements, or other
obligations relating to the sale or transfer thereof, and such Units will not be
subject to any adverse claim. The Seller further represents and warrants that
the Seller is a "United States person" as defined in Section 7701(a)(30) of the
Internal Revenue Code of 1986, as amended, or if the Seller is not a United
States person, the Seller does not own beneficially or of record more than 5
percent of the outstanding Units.
Such Sale shall include, without limitation, all rights in, and claims to, any
Partnership profits and losses, cash distributions, voting rights and other
benefits of any nature whatsoever, distributable or allocable to such Units
under the Partnership Agreement. Upon the execution of this Agreement by the
Seller, Purchaser shall have the right to receive all benefits and cash
distributions and otherwise exercise all rights of beneficial ownership of such
Units.
Seller, by executing this Agreement, hereby irrevocably constitutes and appoints
Purchaser as its true and lawful agent and attorney-in-fact with respect to the
Units with full power of substitution. This power of attorney is an irrevocable
power, coupled with an interest of the Seller to Purchaser, to (i) execute,
swear to, acknowledge, and file any document relating to the transfer of the
ownership of the Units on the books of the Partnership that are maintained with
respect to the Units and on the Partnership's books maintained by the General
Partner of the Partnership, or amend the books and records of the Partnership as
necessary or appropriate for the withdrawal of the Seller as a Unitholder and/or
Limited Partner of the Partnership, (ii) vote or act in such manner as any such
attorney-in-fact shall, in its sole discretion, deem proper with respect to the
Units, (iii) deliver the Units and transfer ownership of the Units on the books
of the Partnership that are maintained with respect to the Units and on the
Partnership's books, maintained by the Partnership's General Partner, (iv)
endorse on the Seller's behalf any and all payments received by Purchaser from
the Partnership for any period on or after December 15, 1998, which are made
payable to the Seller, in favor of Purchaser, (v) execute on the Seller's
behalf, any applications for transfer and any distribution allocation agreements
required by the National Association of Securities Dealers, Inc.'s Notice to
Members 96-14 to give effect to the transaction contemplated by this Agreement,
and (vi) receive all benefits and distributions and amend the books and records
of the Partnership, including Seller's address and record, to direct
distributions to Purchaser as of the effective date of this Agreement and
otherwise exercise all rights of beneficial owner of the Units. Purchaser shall
not be required to post bond of any nature in connection with this power of
attorney.
SELLER DOES HEREBY DIRECT AND INSTRUCT THE PARTNERSHIP AND THE GENERAL PARTNER
IMMEDIATELY UPON THEIR RECEIPT OF THIS AGREEMENT OF SALE (i) TO AMEND THE BOOKS
AND RECORDS OF THE PARTNERSHIP TO CHANGE THE SELLER'S ADDRESS OF RECORD TO
KALMIA INVESTORS, LLC, C/O ARLEN CAPITAL, 1650 HOTEL CIRCLE NORTH, SUITE 200,
SAN DIEGO, CALIFORNIA 92108, AND (ii) TO FORWARD ALL DISTRIBUTIONS AND ALL
OTHER INFORMATION TO BE RECEIVED BY SELLER TO KALMIA INVESTORS, LLC TO THE
ADDRESS SET FORTH IN (i) ABOVE.
Seller and Purchaser do hereby release and discharge the General Partner and its
affiliates and each of their respective officers, directors, shareholders,
employees, and agents from all actions, causes of actions, claims or demands
Seller or Purchaser have, or may have, against any such person that result from
such party's reliance on this Agreement or any of the terms and conditions
contained herein. Seller and Purchaser do hereby indemnify and hold harmless
the Partnership and the General Partner and its affiliates and each of their
respective officers, directors, shareholders, employees, and agents from and
against all claims, demands, damages, losses, obligations, and responsibilities
arising, directly or indirectly, out of a breach of any one or more of their
respective representations and warranties set forth herein.
All authority herein conferred or agreed to be conferred shall survive the death
or incapacity of the Seller and any obligations of the Seller shall be binding
upon the heirs, personal representatives, successors and assigns of the
undersigned. Upon request, the Seller will execute and deliver any additional
documents deemed by the Purchaser or the Partnership to be necessary or
desirable to complete the assignment, transfer and purchase of such Units.
Kalmia reserves the right to amend or extend the offer at any time without
further notice to the Limited Partners.
The Seller hereby certifies, under penalties of perjury, that (i) the tax
identification number shown on this form is the Seller's correct Taxpayer
Identification Number; and (ii) Seller is not subject to backup withholding
either because Seller has not been notified by the Internal Revenue Service (the
"IRS") that Seller is subject to backup withholding as a result of failure to
report all interest or dividends, or the IRS has notified Seller that Seller is
no longer subject to backup withholding.
The Seller hereby also certifies, under penalties of perjury, that the Seller,
if an individual, is not a nonresident alien for purposes of U.S. income
taxation, and if not an individual, is not a foreign corporation, foreign
partnership, foreign trust, or foreign estate (as those terms are defined in the
Internal Revenue Code and Income Tax Regulations). The Seller understands that
this certification may be disclosed to the IRS by the Purchaser and that any
false statements contained herein could be punished by fine, imprisonment, or
both.
This Agreement shall be governed by and construed in accordance with the laws of
the State of California. Seller waives any claim that California or the
Southern District of California is an inconvenient forum, and waives any right
to trial by jury.
The undersigned Seller (including any joint owner(s)) owns and wishes to assign
the number of Units set forth below. By its own or its Authorized Signatory's
signature below, the Seller hereby assigns its entire right, title and interest
to the Units to the Purchaser.
By executing this Agreement the Seller hereby acknowledges to the General
Partner that the Seller desires to withdraw as a Limited Partner as to the Units
referenced herein and hereby directs the General Partner to take all such
actions as are necessary to accomplish such withdrawal, and appoints the General
Partner the agent and attorney-in-fact of the Limited Partner, to execute, swear
to, acknowledge and file any document or amend the books and records of the
Partnership as necessary or appropriate for the withdrawal of the Limited
Partner.
<PAGE>
WESTIN HOTELS LIMITED PARTNERSHIP
IN WITNESS WHEREOF the Limited Partner has executed, or caused its Authorized
Signatory to execute, this Agreement.
Print Name of Limited Partner (as it appears on the
investment)________________________________________________________________
Print Name and Capacity of Authorized Signatory (if other than
above)__________________________________________________________
<TABLE>
<S> <C>
__________________________________ __________________________________
Seller's Signature Joint Seller's Signature
MEDALLION GUARANTEE MEDALLION GUARANTEE
(Medallion Guarantee for each (Medallion Guarantee for each
Seller's signature) Seller's signature)
__________________________________ Investor I.D. Number
__________________________________ Home Telephone Number
__________________________________ Office Telephone Number
__________________________________ Mailing Address
__________________________________ City, State, Zip Code
__________________________________ State of Residence
__________________________________ Social Security/Tax ID No.
__________________________________ Date
$1,000
__________________________________ Sales Price per Unit
_________ Number of Units to be sold
OR
/ / Check here if you wish to sell ALL your units
===========================================
------- FOR INTERNAL USE ONLY -------
ACCEPTED:
--------
KALMIA INVESTORS, LLC
By: Its Manager, Arlen Capital, LLC
By:____________________________________
Authorized Representative
===========================================
YOU MUST MAIL EXECUTED ORIGINAL TO THE DEPOSITARY:
Arlen Capital, LLC
1650 Hotel Circle North, Suite 200
San Diego, California 92108
</TABLE>
<TABLE>
PLEASE CALL US AT (800) 891-4105 IF YOU HAVE ANY QUESTIONS REGARDING THE SALE OF YOUR UNITS.
===========================================================================================================================
<S> <C>
INSTRUCTIONS TO COMPLETE AGREEMENT OF SALE
ALL SIGNATURES MUST BE MEDALLION GUARANTEED
Beneficial Owner of Record Should: Death
- --------------------------------- -----
1. COMPLETE and SIGN Agreement. If any owner is deceased, please enclose a certified copy of
2. Have your signature Medallion Guaranteed by Death Certificate. If Ownership is OTHER than Joint Tenants
your Bank or Broker. With Right of Survivorship, please provide Letter of
3. Indicate Number of Units Owned and/or To Be Sold. Testamentary or Administration current within 60 days
4. Return Agreement in Envelope Provided. showing your beneficial ownership or executor capacity (in
addition to copy of Death Certificate).
Joint Ownership
- ---------------
Please have ALL owners of record sign Agreement, and
SEPARATELY Medallion Guarantee each signature. Corporation
-----------
IRA/KEOGH Corporate resolution required showing authorized signatory.
- ---------
1. Beneficial owner must sign Agreement. Trust, Profit Sharing or Pension Plan
2. Provide Custodian information. (i.e. Name, ---------------------------------------
Company Name, Address, Phone No. and Please provide title, signature, and other applicable pages of
Account No.) Trust Agreement showing authortized signatory.
3. Kalmia will obtain the Medallion Guarantee of
Custodian Signature.
WSTN.02.01.9914D.
===========================================================================================================================
</TABLE>
<PAGE>
WESTIN HOTELS LIMITED PARTNERSHIP
KALMIA INVESTORS, LLC
FEBRUARY 1, 1999
===============================================================================
OFFER TO PURCHASE
WESTIN HOTELS LIMITED PARTNERSHIP UNITS
FOR
$1,000 CASH PER UNIT
===============================================================================
KALMIA IS NOT AN AFFILIATE OF THE GENERAL PARTNER OR OF THE PARTNERSHIP.
PLEASE CAREFULLY REVIEW THE ENCLOSED TENDER OFFER.
~
PAYMENT TO YOU WILL BE MADE WITHIN 5 BUSINESS DAYS FROM (i) MARCH 2, 1999,
THE "EXPIRATION DATE" OF THE OFFER (UNLESS EXTENDED), AND (ii) AFTER WRITTEN
NOTIFICATION FROM THE PARNERSHIP THAT YOUR ADDRESS ON THE RECORDS OF THE
PARTNERSHIP
HAS BEEN CHANGED TO KALMIA'S ADDRESS. THE GENRAL PARTNER HAS AGREED TO
MAKE THE ADDRESS CHANGE SO A SELLER CAN BE PAID.
~
AN AGREEMENT OF SALE IS ENCLOSED WHICH YOU MUST PROPERLY COMPLETE AND DULY
EXECUTE IN ACCORDANCE WITH THE INSTRUCTIONS AND RETURN TO KALMIA.
PLEASE CALL US AT (800) 891-4105, IF YOU HAVE ANY QUESTIONS.
THANK YOU FOR YOUR CONSIDERATION OF OUR OFFER.
===============================================================================
1650 HOTEL CIRCLE NORTH, SUITE 200 . SAN DIEGO, CA 92108 . (800) 891-4105 .
FACSIMILE (619) 686-2056
<PAGE>
THIS ANNOUNCEMENT IS NEITHER AN OFFER TO PURCHASE, NOR A SOLICITATION OF AN
OFFER TO SELL THE SECURITIES. THE OFFER IS MADE ONLY BY THE OFFER TO PURCHASE
AND THE RELATED AGREEMENT OF SALE AND IS NOT BEING MADE (NOR WILL TENDERS BE
ACCEPTED FROM) HOLDERS OF UNITS IN ANY JURISDICTION WHICH THE OFFER OR THE
ACCEPTANCE THEREOF WILL NOT BE IN COMPLIANCE WITH THE SECURITIES LAWS OF SUCH
JURISDICTION; IN THOSE JURISDICTIONS WHERE SECURITIES LAWS REQUIRE THE OFFER TO
BE MADE BY A LICENSED BROKER OR DEALER, THE OFFER SHALL BE DEEMED TO BE MADE ON
BEHALF OF THE PURCHASER ONLY BY ONE OR MORE REGISTERED BROKERS OR DEALERS
LICENSED UNDER THE LAWS OF SUCH JURISDICTION.
NOTICE OF OFFER TO PURCHASE FOR CASH
UP TO 4,900 UNITS OF LIMITED PARTNERSHIP INTERESTS (THE "UNITS")
OF WESTIN HOTELS LIMITED PARTNERSHIP (THE "PARTNERSHIP")
BY KALMIA INVESTORS, LLC, A DELAWARE LIMITED LIABILITY COMPANY
(THE "PURCHASER")
The Purchaser is offering to purchase for cash up to 4,900 Units held by the
Limited Partners of the Partnership (the "Unit Holders") at $1,000 per Unit upon
the terms and subject to the conditions set forth in the Purchaser's Offer to
Purchase and in the related Agreement of Sale (which together constitute the
"Offer" and the "Tender Offer Documents").
THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, EASTERN TIME, ON
TUESDAY, MARCH 2, 1999, UNLESS THE OFFER IS EXTENDED.
Funding for the purchase of the Units will be provided through the
Purchaser's existing working capital.
The Offer will expire at 12:00 midnight, Eastern Time on March 2, 1999, and
unless and until the Purchaser, in its sole discretion, shall have extended the
period of time for which the Offer is open (such date and time, as extended the
"Expiration Date").
If the Purchaser makes a material change in the terms of the Offer, or if
they waive a material condition to the Offer, the Purchaser will extend the
Offer and disseminate additional tender offer materials to the extent required
by Rules 14d-4(c) and 14d-6(d) under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"). The minimum period during which an offer must
remain open following any material change in the terms of the Offer, other than
a change in price or a change in percentage of securities sought will depend
upon the facts and circumstances including the materiality of the change with
respect to a change in price or, subject to certain limitations, a change in the
percentage of securities sought. A minimum of ten business days from the date
of such change is generally required to allow for adequate dissemination to Unit
Holders. Accordingly, if prior to the Expiration Date, the Purchaser increases
(other than increases of not more than two percent of the outstanding Units) or
decreases the number of Units being sought, or increases or decreases the
consideration offered pursuant to the Offer, and if the Offer is scheduled to
expire at any time earlier than the period ending on the tenth business day from
the date that notice of such increase or decrease is first published, sent or
given to Unit Holders, the Offer will be extended at least until the expiration
of such tenth business day. For purposes of the Offer, a "business day" means
any day other than a Saturday, Sunday or federal holiday and consists of the
time period from 12:01 a.m. through 12:00 midnight, Eastern Time.
In all cases payment for the Units purchased pursuant to the Offer will be
made only after timely receipt of the Agreement of Sale, properly completed and
duly executed, with any required signature guarantees, and any other documents
required by such Agreement of Sale.
Tenders of Units made pursuant to the Offer are irrevocable, except that
Unit Holders who tender their Units in response to the Offer will have the right
to withdraw their tendered Units at any time prior to the Expiration Date by
sending a written notice of withdrawal to the Purchaser specifying the name of
the person who
<PAGE>
tendered the Units to be withdrawn. In addition, tendered Units may be
withdrawn at any time after April 2, 1999, unless the tender has theretofore
been accepted for payment as provided above.
If tendering Unit Holders tender more than the number of Units that the
Purchaser seeks to purchase pursuant to the Offer, the Purchaser will take into
account the number of Units so tendered and take up and pay for as nearly as may
be pro rata, disregarding fractions, according to the number of Units tendered
by each tendering Unit Holder during the period during which the Offer remains
open.
The terms of the Offer are more fully set forth in the formal Tender Offer
Documents which are available from the Purchaser. The Offer contains terms and
conditions and the information required by Rule 14d-6(e)(l)(vii) under the
Exchange Act which are incorporated herein by reference.
THE TENDER OFFER DOCUMENTS CONTAIN IMPORTANT INFORMATION WHICH SHOULD BE
READ CAREFULLY BEFORE ANY DECISION IS MADE WITH RESPECT TO THE OFFER.
The Tender Offer Documents may be obtained by written request as set forth
below.
The Tender Offer Documents and, if required, other relevant materials will
be mailed to record holders of Units or persons who are listed as participants
in a clearing agency's security position listing, for subsequent transmittal to
beneficial owners of Units.
FOR COPIES OF THE TENDER OFFER DOCUMENTS CALL THE DEPOSITORY TOLL FREE AT
1-800-891-4105 OR MAKE A WRITTEN REQUEST ADDRESSED TO ARLEN CAPITAL, LLC,
1650 HOTEL CIRCLE NORTH, SUITE 200, SAN DIEGO, CALIFORNIA 92108.
February 1, 1999
<PAGE>
[KALMIA INVESTORS LETTERHEAD]
October 9, 1996
Frederick Kleisner,
Chairman of the Board, Chief Executive Officer
and President
Western Realty Corp.
General Partner of Westin Hotels Limited Partnership
The Westin Building
2001 Sixth Avenue
Seattle, Washington 98121
Re: Transfer Documents/Westin Hotels Limited Partnership
Dear Mr. Kleisner:
I am enclosing, for your information (i) a copy of the Agreement of Sale
entered into between the Sellers of Limited Partnership Interests ("Units") of
Westin Hotels Limited Partnership (the "Partnership") to Kalmia Investors, LLC
("Kalmia"), (attached hereto as Exhibit "A"); (ii) a copy of Assignee Agreement
for such transfers (attached hereto as Exhibit "B"). The form of Assignee
Agreement has been adapted for use by Kalmia and contains all the material terms
and conditions of your standard Assignee Agreement form.
We will submit to you the originally executed Agreement of Sale for each
Seller which has been either notarized or contains a medallion guarantee of the
Seller's signature.
The Agreement of Sale contains a power of attorney granted by the Seller to
Kalmia. Among the powers granted to Kalmia, pursuant to the power of attorney,
are the rights to receive all benefits and distributions endorsed on the
Seller's behalf, any payments received by Kalmia from the Partnership made on or
after September 18, 1996, and to amend the books and records of the Partnership,
including the Seller's address of record and to direct distributions made by the
Partnership to Kalmia.
Pursuant to the power of attorney, we will instruct the Partnership (a form
of instruction is attached hereto as Exhibit "C") to amend the Partnership's
books and records to change the Seller's address to Kalmia's address and to
direct all distributions, whether they are made payable to Seller or to Kalmia,
to be forwarded to Kalmia. Pursuant to the power of attorney, Kalmia will
endorse
<PAGE>
Frederick Kleisner
October 9, 1996
Page 2
any payments made to the Seller to be made payable to Kalmia. Kalmia
will submit a separate instruction sheet for each Seller, and Kalmia's signature
will be medallion guaranteed.
Please note that the Agreement of Sale contains a provision releasing the
General Partner from all claims Seller may have for the General Partner's
reliance on such Agreement.
Based on the foregoing, Western Realty Corp., as general partner of the
Partnership, and the Partnership agree that they will honor the instruction
sheet and Kalmia's power of attorney; make Kalmia an assignee of record in the
Partnership's books and records at such time as the General Partner deems it
appropriate in its sole discretion and in the order of priority received; and
admit Kalmia as a substituted Limited Partner in the Partnership at such time as
it deems appropriate in its sole discretion and in the order of priority
received.
If you agree and accept the foregoing, please indicate the same by
executing this letter agreement in the space provided below and returning a copy
to me.
Thank you for your courtesies in this matter.
Very truly yours,
KALMIA INVESTORS, LLC
By: ARLEN CAPITAL ADVISORS, LLC
Its Manager
By: /s/ Don Augustine
----------------------------
Don Augustine, Manager
<PAGE>
Frederick Kleisner
October 9, 1996
Page 3
The foregoing is agreed and accepted, including the instruction sheet
attached hereto. Executed this _______th day of October, 1996.
WESTERN REALTY CORP.
By: FREDERICK KLEISNER,
CHAIRMAN OF THE BOARD,
CHIEF EXECUTIVE OFFICER AND
PRESIDENT
AS GENERAL PARTNER
and on behalf of
WESTIN HOTELS LIMITED PARTNERSHIP
By:
----------------------------
Frederick Kleisner
<PAGE>
[KALMIA INVESTORS LETTERHEAD]
November 1, 1996
Mr. Don Augustine, Manager
Kalmia Investors, LLC
1420 Kettner Boulevard, Suite 300
San Diego, California 92101
Dear Mr. Augustine:
In response to your letter dated October 9, 1996, please be advised that it has
never been our procedure to change the address of sellers of units to that of
the buyers. In fact, it has always been our policy to send cash distributions
for the quarter on which they are based to the limited partner of record in that
quarter. We do recognize, however, that this would not be the case with your
purchases.
The difficulty we have with your request is that if we change the addresses of
the sellers to that of the buyer, the sellers' year-end tax information will be
sent to your address. There is one alternative and that is to send K-1's to the
sellers at both addresses. However, this would result in a lot of extra work
and additional expense to the partnership. Since your offer expired on October
25 and any related sales will be processed by March 31, 1997, and since we are
not anticipating sending any cash distributions until after March 31, we see no
reason to make the address changes you are requesting at this time. However, in
the event that a cash distribution is scheduled to go out subsequent to your
purchase yet prior to the official transfer of ownership, we will make the
address changes on the accounts affected.
Please call if you have any questions.
Sincerely,
/s/Nina Buffington
Nina Buffington
Investor Relations
cc: Peter R. Pancione
