SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 14D-9
Solicitation/Recommendation Statement Pursuant to Section 14(d)(4)
of the Securities Exchange Act of 1934
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STAMFORD TOWERS LIMITED PARTNERSHIP
(Name of Subject Company)
Stamford Towers Limited Partnership
(Name of Person Filing Statement)
Depositary Units of Limited Partnership Interests
(Title of Class of Securities)
852775 10 5
(CUSIP Number of Class of Securities)
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Ms. Regina M. Hertl
Stamford Towers, Inc.
3 World Financial Center, 29th Floor
New York, New York 10022
(212) 526-3158
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications on Behalf of the Person Filing Statement)
With copies to:
Patrick J. Foye, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
919 Third Avenue
New York, New York 10022
(212) 735-2274
Item 1. Security of Subject Company
The subject company is Stamford Towers Limited
Partnership, a Delaware limited partnership (the "Partnership"). The
general partner of the Partnership is Stamford Towers, Inc., a Delaware
corporation (the "General Partner"). The sole limited partner of the
Partnership is Stamford Towers Depositary Corporation, a Delaware
corporation (the "Assignor Limited Partner"). The address of the
principal executive office of the General Partner and the Assignor
Limited Partner is 3 World Financial Center, 29th Floor, New York, NY,
10285, Attn.: Ms. Regina M. Hertl. The title of the class of equity
securities to which this statement relates is the outstanding depositary
units of limited partnership interests in the Partnership (the "Units").
Item 2. Tender Offer of the Bidder
This statement relates to the unsolicited tender offer
being made by Steele Hill Partners L.L.C., a Delaware limited liability
company (the "Bidder"), disclosed in a Tender Offer Statement on
Schedule 14D-1, dated February 14, 1997 (the "Schedule 14D-1"), to
purchase from holders of the Units (the "Unitholders") up to 2,300,000
Units, representing 29.4% of the outstanding Units, of the Partnership,
upon the terms and subject to the conditions set forth in the Offer to
Purchase dated February 14, 1997 (the "Offer to Purchase") and the
Letter of Transmittal (the "Letter of Transmittal" and together with the
Offer to Purchase, the "Steele Hill Offer"). Neither the Bidder nor any
of its affiliates are affiliated with the Partnership or its general
partner and the Steele Hill Offer was not solicited by the Partnership
or its management. The Schedule 14D-1 states that the principal place of
business of the Bidder is One International Place, Boston, MA 02110.
Item 3. Identity and Background
(a) The name and business address of the Partnership,
which is the person filing this statement, are set forth in Item 1
above.
(b)(1) The Partnership does not have any directors or
executive officers. The General Partner is responsible for the
management of the Partnership's business. Except as described below,
there are no material contracts, agreements, arrangements and
understandings or any actual or potential conflicts of interest between
the General Partner or its affiliates and the Partnership or its
affiliates.
Pursuant to the Amended and Restated Agreement of Limited
Partnership of the Partnership dated November 1, 1986 (the "Partnership
Agreement"), the General Partner and its affiliates have received or may
be entitled to receive certain types of compensation, fees, or other
distributions in connection with the operation of the Partnership as
follows:
Pursuant to the Partnership Agreement, distributions of
Net Cash Flow from Operations (as defined in the Partnership Agreement)
shall be made quarterly each year on the basis of 99% to the Unitholders
and 1% to the General Partner until each Unitholder receives an amount
equal to his Preferred Return (as such term is defined in the
Partnership Agreement). Distributions of Net Cash Flow from Operations
after each Unitholder has received his Preferred Return shall be
distributed 90% to the Unitholders and 10% to the General Partner. To
date, the General Partner has not received any distributions of Net Cash
Flow from Operations.
Pursuant to the Partnership Agreement, distributions of
Net Proceeds from an Interim Capital Transaction (as defined in the
Partnership Agreement), if any, shall be distributed after the close of
the calendar quarter in which the Interim Capital Transaction occurs.
Net Proceeds from Interim Capital Transactions shall first be
distributed 99% to the Unitholders and 1% to the General Partner until
each Unitholder receives an amount equal to his Preferred Return
Arrearage and Unrecovered Capital (as such terms are defined in the
Partnership Agreement), with any remaining proceeds to be distributed
90% to the Unitholders and 10% to the General Partner. To date, the
General Partner has not received any distributions of Net Proceeds from
Interim Capital Transactions.
Pursuant to the Partnership Agreement, distributions of
Net Proceeds upon dissolution of the Partnership shall be distributed
after the close of the calendar quarter in which such proceeds have been
received to Unitholders of record as of the last day of the calendar
month in which such proceeds have been received. Subject to certain
capital account limitations, Net Proceeds from any event causing
dissolution of the Partnership shall first be distributed 99% to the
Unitholders and 1% to the General Partner until each Unitholder receives
an amount equal to his Unrecovered Capital and Preferred Return
Arrearage. Any remaining proceeds shall generally be distributed 90% to
the Unitholders and 10% to the General Partner.
Pursuant to the Partnership Agreement, the General
Partner is entitled to reimbursement for all out-of-pocket expenses
incurred by the General Partner in connection with the Partnership's
business and payable to entities unaffiliated with the General Partner.
The General Partner may be reimbursed for the cost of administrative
services necessary for the prudent operation of the Partnership provided
that the reimbursement shall be at the lower of the General Partner's
actual cost or the amount the Partnership would be required to pay to
independent parties for comparable administrative services in the same
geographic location. For the years ended December 31, 1995, 1994 and
1993, the costs of such services were $59,445, $51,044 and $55,375,
respectively. At December 31, 1995 and 1994, $17,846 and $31,027,
respectively, were due to the General Partner as reimbursement for
expenses previously paid on behalf of the Partnership to unaffiliated
entities.
The General Partner and its respective officers and
directors are each entitled to indemnification under certain
circumstances from the Partnership pursuant to provisions of the
Partnership Agreement and applicable law.
An affiliate of the General Partner earned fees and
compensation in connection with organization, syndication and
acquisition services rendered to the Partnership. As of December 31,
1995, $127,921 of these amounts remain accrued and unpaid.
(b)(2) Except as described below, there are no material
contracts, agreements, arrangements or understandings or any actual or
potential conflicts of interest between the Partnership or its
affiliates and Steele Hill, their executive officers, directors or
affiliates.
A letter agreement dated as of November 27, 1996 (the
"Standstill Agreement"), was entered into between Michael L. Ashner, the
vice president of an affiliate of Steele Hill, and the Partnership. The
Standstill Agreement was entered into in connection with the
Partnership's response to Mr. Ashner's request for a list of the names
and addresses of Unitholders. The Standstill Agreement generally
provides that the Unitholder list will be provided to Mr. Ashner, for
use by him and his affiliates, and in exchange, Mr. Ashner has agreed,
on behalf of himself and his affiliates, that for the two-year period
beginning November 27, 1996, he would not: (i) acquire more than 30% of
the outstanding Units of the Partnership, (ii) seek or propose to enter
into any merger, sale, acquisition of assets or similar transaction
involving the Partnership, (iii) make or participate in a proxy
solicitation with respect to the Partnership, (iv) form, join or
otherwise participate in a group with respect to any voting securities
of the Partnership, (v) disclose any intention or plan to any
third-party which is inconsistent with the terms of the Standstill
Agreement, or (vi) loan money to, advise, assist or encourage any person
in connection with any action inconsistent with the Standstill
Agreement.
The Standstill Agreement also generally provides for: (i)
prior notice to the Partnership of any communication with Unitholders
and (ii) notice to the Partnership of any approaches to Mr. Ashner or
his affiliates concerning participation in any transaction involving the
Partnership's assets, business or securities or involving any action
inconsistent with the Standstill Agreement. In addition, the Standstill
Agreement also provides that for the two-year period beginning November
27, 1996, all Units owned or acquired by Mr. Ashner or his affiliates
are required to be voted: (i) on all issues proposed by the Partner-
ship, in the same proportion as other Unitholders and (ii) on all issues
proposed by any person other than the Partnership, in the manner
recommended by the General Partner. Notwithstanding the above, such
Units may be voted in any manner if the proposal relates to an increase
in the fees or other compensation currently payable to the General
Partner by the Partnership pursuant to the Partnership Agreement. The
Standstill Agreement also contains certain other agreements between the
parties, including an accelerated termination provision if at any time
after November 27, 1997, the combined occupancy level of the Property is
below 70%. A copy of the Standstill Agreement is included as Exhibit
(c)(1).
Item 4. The Solicitation or Recommendation
(a) The Partnership's management met following the
announcement of the Steele Hill Offer to review and consider the Offer
and to explore various alternative courses of action which might be
available to the Partnership in response to the Steele Hill Offer. The
Partnership, in light of all relevant circumstances, determined that the
Steele Hill Offer is inadequate and not in the best interests of either
the Partnership or the Unitholders. The Partnership recommends that the
Unitholders reject the Offer.
(b) The Partnership reached the conclusion set forth in
Item 4(a) after considering a variety of factors, including, but not
limited to, the following.
i) Improved Performance of the Property and Local Market
Conditions. The Partnership's two commercial office
buildings (the "Property") are currently operating at
their highest occupancy levels since completion of
construction. The Property's occupancy rate is currently
70% -- a significant increase from the 51% occupancy rate
of only one year ago. Although there can be no assurance
that the Partnership's leasing efforts will continue to
be successful, the Partnership is currently discussing
leases with prospective tenants which, if executed, would
increase the Property's occupancy rate to at least 75%.
Furthermore, as discussed in the Partnership's recent
quarterly reports, the Stamford, Connecticut commercial
office market, where the Property is located, has shown
continued improvement.
ii) Offer is Significantly Less than Current Net Asset Value.
The price being offered by Steele Hill is 60% BELOW the
Partnership's estimate of current net asset value ("NAV")
of $3.82 per Unit. The Partnership's NAV, as determined
by an independent third-party appraisal, was calculated
by assuming the Property was sold at a price equal to
its fair market value, adjusted for the Partnership's
other assets and liabilities, as of December 31, 1996. As
further evidence of the improving performance of
Unitholders' investment, the Partnership's current NAV
represents an increase of $1.45 per Unit, or 61%, from
the prior year's NAV of $2.37 per Unit. Contrary to the
statement in Steele Hill's communication to Unitholders,
the Partnership's NAV already accounts for the entire
judgment in connection with the Gilbane litigation.
iii) Unitholders who Tender would Forfeit the Right to any
Potential Distributions. As discussed above, Steele Hill
is attempting to acquire Units at a significant discount
at a time when the appraised value of the Property has
increased, and the commercial office market in Stamford,
Connecticut has improved. After purchasing Units, the
Partnership believes Steele Hill then expects to make a
significant profit from any potential distributions from
operations or arising from the future sale of the
Property.
iv) First Mortgage Refinancing. The Partnership is exploring
its options with respect to refinancing the approximately
$17.8 million first mortgage debt which matures in August
1997. Based on discussions with its experts, and in light
of the relatively low amount of the first mortgage
compared to the Property's $43.35 million appraised
value, the Partnership currently anticipates that it
should be able to refinance the first mortgage upon
maturity. The Partnership intends to seek a new first
mortgage which would make available future loan advances
to fund, among other things, tenant improvements and
leasing commissions.
v) Bidder Conflict. Steele Hill concedes that there is a
conflict of interest between its desire to purchase Units
at a low price and Unitholders' desire to sell them at a
high price.
Item 5. Persons Retained, Employed, or to be Compensated
The Partnership's administrative agent, First Data
Investor Services Group ("First Data"), will assist with communications
with Unitholders with respect to, and to provide other services to the
Partnership in connection with, the Steele Hill Offer. The Partnership
will pay First Data reasonable and customary fees for its services,
reimburse it for reasonable expenses and provide customary indemnities.
Neither the Partnership nor any person acting on its behalf has
employed, retained, or compensated or currently intends to employ,
retain or compensate any other person or class of persons to make
solicitations or recommendations to Unitholders on its behalf concerning
the Steele Hill Offer.
Item 6. Recent Transactions and Intent with Respect to Securities
(a) Neither the Partnership nor the General Partner has
effected any transactions in the Units during the past 60 days. The
Partnership is not aware of any other transactions in the Units during
the past 60 days by the General Partner's executive officers, directors,
affiliates, or subsidiaries.
(b) Neither the Partnership nor, to the best knowledge of
the Partnership, any of the General Partner's executive officers,
directors, affiliates, or subsidiaries intends to tender Units owned by
them in the Steele Hill Offer.
Item 7. Certain Negotiations and Transactions by the Subject Company
(a) None
(b) None
Item 8. Additional Information to be Furnished
Calculation of NAV. Determination of Net Asset Value Per $10 Unit at
December 31, 1996 (Unaudited)
Partnership's
Share of
December 31,
1996 Appraised
Property Value (1)
North Tower $ 27,600,000 (1)
South Tower 15,750,000 (1)
Less: Revolving loan payable (17,798,291)
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25,551,709
Cash and cash equivalents (3) 5,668,459
Accounts receivable 80,245
Prepaid expenses 1,632,689
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32,933,102
Less:
Total liabilities (3) (2,584,130)
Interest payable (134,080)
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Partnership Net Asset Value (2) $ 30,214,892
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Net Asset Value Allocated:
Limited Partners $ 29,912,743
General Partner 302,149
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$ 30,214,892
Net Asset Value Per Unit
(7,826,300 Units outstanding) $3.82
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(1) This represents the December 31, 1996 appraised values which
were determined by an independent third-party appraisal.
(2) The Net Asset Value assumes a hypothetical sale on December 31,
1996 of the Property at prices based upon its value as
determined by an independent third-party appraisal, and the
distribution of the proceeds of such sale, combined with the
Partnership's cash after payment of the Partnership's
liabilities, to the Partners.
(3) Cash and cash equivalents includes a reserve of $925,070 in
funds withheld for the judgment awarded to Gilbane & Moliterno
regarding the legal proceedings. The accrual for this judgment
is reflected within total liabilities. Accordingly, the NAV, as
calculated above, takes into account such liabilities.
Unitholders should note that appraisals are estimates of current value
and actual values realizable upon sale may be significantly different. A
significant factor in establishing an appraised value is the actual
selling price for properties which the appraiser believes are
comparable. In addition, the appraised value does not reflect the actual
costs which would be incurred in selling the Property. As a result of
these factors and the illiquid nature of an investment in Units, the
variation between the appraised value of the Property and the price at
which Units of the Partnership could be sold may be significant.
Gilbane Litigation. Steele Hill has identified liabilities associated
with pending litigation against the Partnership as a purchase price
consideration. As has been previously disclosed, the Partnership has
been involved in litigation with the former construction manager,
Gilbane Building ("Gilbane") and a subcontractor on the project,
Moliterno Stone Sales, Inc. ("Moliterno"). In this suit, Gilbane sought
$2.65 million in damages plus interest and other relief. Moliterno
sought $155,000 in damages, plus interest and other relief. On November
18, 1996, the Connecticut Superior Court entered a final judgment in
this proceeding awarding Gilbane $770,070 without interest on one of its
claims and dismissed the remaining claims. The court awarded Moliterno
$155,000 without interest on its claim against the Partnership. All
remaining claims, including the Partnership's counterclaims, were dis-
missed. Since the entry of that judgment, Gilbane has moved for
reconsideration of certain portions of the court's judgment. The
Partnership intends to vigorously contest this motion. The Partnership
has sufficient cash to pay the amounts awarded to Gilbane and Moliterno
and has included the amounts as a settlement expense and as a liability
which the Partnership anticipates it will have to pay upon final
resolution of this matter. Such amounts are also fully reflected in the
Partnership's calculation of NAV.
Cautionary note regarding forward looking statements. This letter
contains forward-looking statements that are not historical facts and
which reflect numerous assumptions and involve a number of risks and
uncertainties. Forward-looking statements contained in the foregoing
include statements relating to the occupancy and other related
performance of the Property, the Stamford commercial real estate market,
the future value of the Units, the Partnership's belief as to Steele
Hill's intentions and the refinancing of the Partnership's first
mortgage. Among the factors which can cause actual results to materially
differ from those expressed by the Partnership include, but are not
limited to, changes in the local and national real estate markets,
changes in interest rates, restrictions in financing, changes in the
condition of the Property, unanticipated expenditures, changes in local
or national economic conditions, changes in environmental laws, changes
in building codes, changes in other laws or regulations, changes in
the competitive environment for commercial real estate, other factors
affecting real estate and other factors discussed from time to time in
the Partnership's documents and reports filed with the Securities and
Exchange Commission.
Item 9. Material to be Filed as Exhibits
(a)(1) Form of Letter from the Partnership to Unitholders, dated
February 21, 1997.
(b) Not applicable.
(c)(1) Letter Agreement, dated November 27, 1996, among the
Partnership, Sunshine Wire & Cable Defined Benefit Plan,
and Michael A. Ashner.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true,
complete and correct.
Dated: February 21, 1997
STAMFORD TOWERS LIMITED PARTNERSHIP
BY: STAMFORD TOWERS INC.
General Partner
BY: /s/ Regina M. Hertl
Name: Regina M. Hertl
Title: President
EXHIBIT INDEX
Exhibit No. Description
(a)(1) Form of Letter from the Partnership to
Unitholders, dated February 21, 1997.
(b) Not applicable.
(c)(1) Letter Agreement, dated November 27, 1996, among
the Partnership, Sunshine Wire & Cable Defined
Benefit Plan, and Michael A. Ashner.
Exhibit (a)(1)
c/o Service Data Corporation
2424 South 130th Circle
Omaha, NE 68144-2596
(800 223-3464
February 21, 1996
Dear Unitholder:
If you have not already, you will soon be receiving materials from
Steele Hill Partners L.L.C. ("Steele Hill") describing its partial
tender offer (the "Offer") to purchase up to 2,300,000 limited
partnership units (the "Units"), or 29.4% of the total Units
outstanding, of Stamford Towers Limited Partnership (the "Partnership")
at a price of $1.51 per Unit, less the amount of any distributions
declared or made by the Partnership between February 14, 1997 and the
date of purchase. Neither Steele Hill nor any of its affiliates are
affiliated with the Partnership or its general partner, and the Offer
was not solicited by the Partnership or its management.
AFTER CAREFULLY REVIEWING THE OFFER, WE HAVE DETERMINED THAT THE
PURCHASE PRICE IS INADEQUATE AND DOES NOT REFLECT THE INHERENT VALUE OF
YOUR UNITS. IN LIGHT OF ALL RELEVANT CIRCUMSTANCES, WE BELIEVE THAT IT
IS NOT IN YOUR BEST INTEREST TO ACCEPT THE OFFER AND RECOMMEND THAT YOU
REJECT IT.
The Partnership reached its conclusion after considering a variety of
factors, including, but not limited to, the following:
o Improved Performance of the Property and Local Market Conditions. The
Partnership's two commercial office buildings (the "Property") are
currently operating at their highest occupancy levels since
completion of construction. The Property's occupancy rate is
currently 70% -- a significant increase from the 51% occupancy rate
of only one year ago. Although there can be no assurance that the
Partnership's leasing efforts will continue to be successful, the
Partnership is currently discussing leases with prospective tenants
which, if executed, would increase the Property's occupancy rate to
at least 75%. Furthermore, as discussed in the Partnership's recent
quarterly reports, the Stamford, Connecticut commercial office
market, where the Property is located, has shown continued
improvement.
o Offer is Significantly Less than Current Net Asset Value. The price
being offered by Steele Hill is 60% BELOW the Partnership's estimate
of current net asset value ("NAV") of $3.82 per Unit. The
Partnership's NAV, as determined by an independent third-party
appraisal, was calculated by assuming the Property was sold at a
price equal to its fair market value, adjusted for the Partnership's
other assets and liabilities, as of December 31, 1996. As further
evidence of the improving performance of your investment, the
Partnership's current NAV represents an increase of $1.45 per Unit,
or 61%, from the prior year's NAV of $2.37 per Unit. Contrary to the
statement in Steele Hill's communication to you, the Partnership's
NAV already accounts for the entire judgment in connection with the
Gilbane litigation.
o Unitholders who Tender would Forfeit the Right to any Potential
Distributions. As discussed above, Steele Hill is attempting to
acquire your Units at a significant discount at a time when the
appraised value of the Property has increased, and the commercial
office market in Stamford, Connecticut has improved. After purchasing
your Units, Steele Hill then expects to make a significant profit
from any potential distributions from operations or arising from the
future sale of the Property.
o First Mortgage Refinancing. The Partnership is exploring its options
with respect to refinancing the approximately $17.8 million first
mortgage debt which matures in August 1997. Based on discussions with
its experts, and in light of the relatively low amount of the first
mortgage compared to the Property's $43.35 million appraised value,
the Partnership currently anticipates that it should be able to
refinance the first mortgage upon maturity. The Partnership intends
to seek a new first mortgage which would make available future loan
advances to fund, among other things, tenant improvements and leasing
commissions.
o Bidder Conflict. Steele Hill concedes that there is a conflict of
interest between its desire to purchase your Units at a low price and
your desire to sell them at a high price.
THE PARTNERSHIP RECOMMENDS THAT YOU REJECT THE STEELE HILL OFFER AND NOT
TENDER YOUR UNITS.
Attached to this letter is the Partnership's response to the Steele Hill
Offer which has been filed on Schedule 14D-9 with the Securities and
Exchange Commission. While we urge you to read the Schedule 14D-9 in its
entirety, Unitholders should carefully review Item 8 therein, which
describes certain risks inherent in the forward-looking statements
contained in this letter and the Schedule 14D-9.
We will, of course, keep you informed of significant events concerning
the Partnership. If you have any questions, please call the
Partnership's administrative agent, First Data Investor Services Group,
at (800) 223-3464.
Very truly yours,
Regina M. Hertl
President
Stamford Towers, Inc.
General Partner
Exhibit (c)(1)
STAMFORD TOWERS LIMITED PARTNERSHIP
3 World Financial Center
29th Floor
New York, NY 10285
November 27, 1996
PERSONAL AND CONFIDENTIAL
Ira J. Gaines
Sunshine Wire & Cable Defined Benefit Plan
3116 East Shea Blvd
Phoenix, Arizona 85028
Dear Mr. Gaines:
The purpose of this letter is to set forth our understanding with
regard to any proposed acquisition of outstanding units of limited
partnership interests ("Units") of Stamford Towers Limited Partnership, a
Delaware limited partnership (the "Partnership"), from holders of Units
(each a "Unitholder" and collectively, the "Unitholders") by Sunshine
Wire & Cable Defined Benefit Plan or any person who is its Affiliate (as
defined below) or Michael L. Ashner or any of his Affiliates (col-
lectively, "you").
In response to your request and in consideration of the
agreements set forth in this letter agreement, the Partnership agrees to
provide you a current list of the names and addresses of the Unitholders
along with the number of Units owned by each of them in a computer
readable form reasonably requested by you. You agree that you may only
use the list to acquire up to 30% (including Units acquired through all
other means) of the Partnership's outstanding Units.
You represent and warrant that on the date hereof you
beneficially own one thousand (1,000) Units. You also agree that until
the second anniversary of the date of this letter agreement, neither you
nor any person who is your Affiliate (as defined under Rule 405 of the
Securities Act of 1933, as amended) will, without the prior written
consent of the Partnership, which may be withheld for any reason, (i) in
any manner including, without limitation, by tender offer (whether or not
pursuant to a filing made with the Securities and Exchange Commission),
acquire, attempt to acquire or make a proposal to acquire, directly or
indirectly, more than 30% (including Units acquired through all other
means) of the outstanding Units of the Partnership from any Unitholder,
Unitholders or otherwise, (ii) seek or propose to enter into, directly or
indirectly, any merger, consolidation, business combination, sale or
acquisition of assets, liquidation, dissolution or other similar trans-
action involving the Partnership, (iii) make, or in any way participate,
directly or indirectly, in any "solicitation" of "proxies" or "consents"
(as such terms are used in the proxy rules of the Securities and Exchange
Commission) to vote, or seek to advise or influence any person with
respect to the voting of any voting securities of the Partnership, (iv)
form, join or otherwise participate in a "group" (within the meaning of
Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) with respect to any voting securities of the
Partnership, (v) disclose to any third party any intention, plan or
arrangement inconsistent with the terms of this letter agreement or (vi)
loan money to, advise, assist or encourage any person in connection with
any action inconsistent with the terms of this letter agreement.
You also agree that until the second anniversary of the date of
this letter agreement you shall not make any proposal or request,
directly or indirectly, to amend, waive or terminate any provision of
this letter agreement (including this sentence). In addition, you agree
that you will notify the Partnership at least seven days before
initiating any communication with Unitholders and provide a copy of such
communication (if written) with such notice.
If at any time during such two-year period you are approached
by any third party concerning participation in any transaction involving
the assets, businesses or securities of the Partnership or involving any
action inconsistent with the terms of this letter agreement, you will
promptly inform the Partnership of the nature of any such contact and the
parties thereto. You shall not, without the prior written consent of the
Partnership, disclose to any party that is not an Affiliate the list of
Unitholders' names, addresses and number of Units held that was provided
to you by the Partnership.
You understand that the general partner of the Partnership may
consider from time to time selling all or substantially all of the assets
of the Partnership or entering into any other transaction in the best
interests of the Unitholders and the Partnership. The result of any such
transaction, if approved by a majority vote of the Unitholders if
required, might be the dissolution and liquidation of the Partnership in
accordance with the partnership agreement. Accordingly, in order to avoid
disrupting any possible sale of all or substantially all of the
Partnership's assets or any other transaction in the best interests of
the Unitholders and the Partnership and any required vote of Unitholders,
you agree that, until the second anniversary of the date of this letter
agreement, all Units obtained by you pursuant to any means will be voted
by you (i) on all issues proposed by the Partnership in the same
proportion as by all other Unitholders who vote on any such proposal and
(ii) on all issues proposed by any person other than the Partnership or
any of its Affiliates in the manner that is recommended by the general
partner of the Partnership on any such proposal, provided, however, you
shall be entitled to vote in any manner if the proposal relates to an
increase in the fees or other compensation currently payable to the
general partner pursuant to the Partnership's partnership agreement.
We each hereby acknowledge that we are aware, and that we will
advise our respective Affiliates of our respective responsibilities under
the securities laws. We each agree that the other of us or our respective
Affiliates, as the case may be, shall be entitled to equitable relief,
including injunctive relief and specific performance, in the event of any
breach of the provisions of this letter agreement, in addition to all
other remedies available at law or in equity. You also agree that, during
such two-year period, you shall not sell, transfer, assign or convey any
Units now owned, or hereafter acquired, by you to any party, unless such
party agrees in writing to be bound by the terms of this agreement.
Notwithstanding anything contained herein to the contrary, you
shall be entitled to terminate this letter agreement by written notice to
the Partnership if, after one year from the date hereof, the overall
occupancy level for the Project is not at least 70% pre-leased. "Project"
means the two Stamford Towers office buildings considered together.
In case any provision in or obligation under this letter
agreement shall be invalid, illegal or unenforceable in any jurisdiction,
the validity, legality and enforceability of the remaining provisions
or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.
This letter agreement shall be governed by the laws of the State
of New York without giving effect to principles of conflicts of law
thereof. This letter agreement may be executed in counterparts, each of
which shall be deemed an original, but all of which together constitute
one and the same instrument.
If you agree with the foregoing, please sign and return two
copies of this letter agreement, which will constitute our agreement with
respect to the subject matter of this letter agreement.
Very truly yours,
STAMFORD TOWERS LIMITED PARTNERSHIP
By: Stamford Towers, Inc.,
its general partner
By: /s/ Regina M. Hertl
Name: Regina M. Hertl
Title: President
Confirmed and agreed to as of
the date first above written
SUNSHINE WIRE & CABLE DEFINED BENEFIT PLAN
By: /s/ Ira J. Gaines
Name: Ira J. Gaines
Title: Trustee
/s/ Michael L. Ashner
Michael L. Ashner
