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Exhibit 99.1
Press Release
BURNHAM PACIFIC ANNOUNCES THE APPOINTMENT OF JAY L. SCHOTTENSTEIN AS CO-CHAIRMAN
OF ITS BOARD AND THE RETENTION OF DDR REAL ESTATE SERVICES AS LIQUIDATION AGENT
SAN DIEGO, CALIF.-- September 12, 2000--Burnham Pacific Properties, Inc. today
announced that it has appointed Jay L. Schottenstein, Chairman of the Board of
Schottenstein Stores Corporation, Value City Department Stores and American
Eagle Outfitters, Inc., as Co-Chairman of the Board of Directors. In addition,
it has retained DDR Real Estate Services, Inc. ("DDRRES"), an affiliate of
Developers Diversified Realty Corp. and Coventry Real Estate Partners, to assist
the Company in the liquidation of its properties and to provide a variety of
other services in connection with the Company's previously announced plan of
liquidation, including property management, leasing oversight and construction
management services.
Scott C. Verges, the Company's President and interim Chief Executive Officer,
stated "We are pleased to have a professional with the proven track record and
business acumen of Jay Schottenstein agree to serve as our Co-Chairman." Mr.
Schottenstein's appointment was made pursuant to an agreement that the Company
entered with a group affiliated with Mr. Schottenstein and Michael L. Ashner, as
part of which Mr. Ashner has also joined Burnham's Board. Mr. Ashner is Chief
Executive Officer of Winthrop Financial Associates, a Limited Partnership, which
is engaged in real estate asset management.
Under the agreement, members of the Schottenstein/Ashner group, who own
approximately 9.8% of the Company's common stock, have agreed to vote their
shares in favor of the Company's plan of liquidation and director nominees.
Pursuant to the agreement and related changes to the Company's shareholder
rights plan, the members of the Schottenstein/Ashner group will be permitted to
beneficially own, in the aggregate, up to 19.9% of the Company's common stock,
subject to limitations relating to the Company's continued qualification as a
real estate investment trust. In addition, the members of the
Schottenstein/Ashner group have dismissed with prejudice their pending
litigation against Burnham. The Company and the group members have mutually
released all claims between them and, as part of the settlement, Burnham has
paid to the group $1 million and has agreed to pay to the group an additional
$1.5 million if and when the preferred stock has been redeemed. These payments
constitute a reimbursement to the group for expenses incurred and in connection
with providing such release.
Burnham also announced today that it has retained DDR Real Estate Services,
Inc. ("DDRRES"), an affiliate of Developers Diversified Realty Corp. and
Coventry Real Estate Partners, to assist the Company in the liquidation of
its properties and to provide a variety of other services in connection with
the Company's previously announced plan of liquidation, including property
management, leasing and construction management services. In consideration of
these services, the Company will pay to DDRRES customary management, leasing
and construction management fees. DDRRES may also earn an incentive fee in an
amount equal to ten percent of the amount, if any, by which liquidating
distributions (defined as all distributions in excess of net income under
generally accepted accounting principles) paid to the Company's common
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stockholders exceed $7.50 per share. The agreement is generally conditioned upon
the approval by Burnham's stockholders of the Company's plan of liquidation. A
copy of the Liquidation and Property Management Services Agreement between
Burnham and DDRRES will be filed shortly by Burnham with the Securities and
Exchange Commission under cover of Form 8-K.
Commenting on the agreement, Verges said, "We are pleased to have engaged a firm
with such a strong national reputation in the retail real estate industry to
assist us in our efforts to maximize shareholder value as we implement our plan
of liquidation."
Last week, Burnham announced that Prudential Real Estate Investors has agreed to
acquire 15 West Coast retail properties from the company for approximately $355
million. Fourteen properties will be acquired through a joint venture with
Developers Diversified Realty Corp. and Coventry Real Estate Partners, and one
property will be wholly owned by Developers Diversified Realty.
Burnham also announced today that its Board of Directors has declared a regular
quarterly dividend on the Company's common stock in an amount of $0.10 per share
to stockholders of record on September 19, 2000. The payment date for the
dividend is September 29, 2000.
Burnham Pacific Properties, Inc. is a real estate investment trust (REIT) that
focuses on value-added retail real estate opportunities. On a quarterly basis,
Burnham makes available supplemental information that includes property and
corporate level detail which is available upon request. More information on
Burnham may be obtained by calling 800.462.5181, or visiting the Company's
website at www.burnhampacific.com.
This news release contains forward-looking statements that predict or indicate
future events or trends or that do not relate to historical matters. There are a
number of important factors that could cause actual events to differ materially
from those indicated by such forward-looking statements. These factors include,
but are not limited to, uncertainties in the strategic alternatives process, the
Company's ability to consummate binding agreements with prospective purchasers
of its assets, as well as other factors discussed in the Company's periodic
reports filed with the Securities and Exchange Commission, including the risk
factors that were disclosed in our Form 10-K that was filed with the SEC on
March 30, 2000. You should be aware that the risk factors contained in that Form
10-K may not be exhaustive. Therefore, we recommend that you read the
information in that Form 10-K together with other reports and documents that we
file with the SEC from time to time, including our Forms 10-K, 10-Q and 8-K,
which may supplement, modify, supersede or update those risk factors.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
Burnham Pacific Properties, Inc. plans to mail a proxy statement to its
stockholders containing information about the plan of liquidation and the
election of directors. Investors and securityholders of Burnham Pacific
Properties, Inc. are advised to read the proxy statement carefully when it
becomes available because it will contain important information about the plan
of liquidation, the persons soliciting proxies related thereto and the election
of directors, their interests in the liquidation, and related matters. Investors
and securityholders may obtain free copies of the proxy statement (when
available) and other documents filed by Burnham at the Securities and Exchange
Commission's website at www.sec.gov.
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Free copies of the proxy statement will also be available from Burnham by
directing such requests to the attention of Daniel B. Platt, Chief Financial
Officer, Burnham Pacific Properties, Inc., 110 West A Street, San Diego,
California 92101, telephone 619/652/4700.
INFORMATION CONCERNING PARTICIPANTS
Burnham, its directors, executive officers and certain other members of
management and employees may solicit proxies from Burnham stockholders in favor
of the plan of liquidation and the election of directors. As of the date of this
communication, the officers and directors of Burnham each beneficially own less
than 1% of the outstanding common stock of Burnham, other than Malin Burnham who
beneficially owns approximately 1.65%.
Contact:
Burnham Pacific Properties, Inc.
Daniel B. Platt, 619-652-4700
Chief Financial Officer
Fax: 619-652-4711
[email protected]
