Exhibit (a)(1)-3
KALMIA INVESTORS, LLC
601 CARLSON PARKWAY, SUITE 200
MINNETONKA, MN 55305
FOR INFORMATION:
(800) 547-0854
July 24, 2003
To Holders of Units of Limited Partnership Interests
of Westin Hotels Limited Partnership
Dear Unit Holder:
Enclosed with this letter are the Offer to Purchase and Agreement of Sale
(together, our "Offer") by Kalmia Investors, LLC (the "Purchaser" or "Kalmia")
to purchase limited partnership interests (each a "Unit") of Westin Hotels
Limited Partnership, a Delaware limited partnership (the "Partnership"). The
Offer is for up to 79,917 Units, representing approximately 59% of the Units
outstanding on the date of the Offer.
o Kalmia is offering to pay $550 in cash for each Unit, less the amount of
any distributions declared or paid on or after July 7, 2003 (our "Purchase
Price").
o Kalmia will pay the $50 per transfer fee charged by the Partnership. You
will not pay it.
CONSIDER OUR OFFER. OUR PURCHASE PRICE OF $550 PER UNIT IS:
o 65% over the average sale price of $333.36 of Units from January 1 - March
17, 2003, as reported by the Partnership in its Form 10-K filed on March
21, 2003.
o 35% over the weighted average price of $407.82 per Unit traded over the 12
months ending March 31, 2003, reported by the Partnership Spectrum.
o 22% over the lowest sale price of $451 and 13% above the highest sale price
of $485 per Unit for Units sold from April 1, 2003, through May 31, 2003,
reported by the American Partnership Board.
o Higher than we estimate Unit holders would receive from a sale of the hotel
and liquidation of the Partnership. In the Partnership's recent preliminary
proxy statement, the General Partner assumes "a sale of the Michigan Avenue
[hotel] today at an estimated price of $96.7 million". Based on our own
assumptions, we estimate that the proceeds to each Unit holder from a sale
of the hotel at $96.7 million would be $546 per Unit. However, the General
Partner goes on to cite "the weakness of the market for the sale of
full-service hotels and the inability of the Partnership to find a suitable
purchaser for the Michigan Avenue [hotel]". If the General Partner is
correct, your ability to benefit from a sale of the hotel at the present
time is doubtful.
You may have received notice of an offer from Windy City Investments LLC for 15%
of the Units.
Our Purchase Price is also higher than the Windy City offer.
o We are offering $550 in cash for the Units. Windy City is offering only
$525 per Unit.
o We will pay the $50 per transfer fee charged by the Partnership. Windy
City's offer makes you pay the $50.
o We are tendering for 59% of the Units while Windy City's offer is for only
15% of the Units. Therefore, the chances of your being subject to proration
and remaining a Unitholder are much less if you tender to Kalmia than if
you tender to Windy City.
TO TENDER TO US, PLEASE READ THE PROCEDURES DESCRIBED IN OUR OFFER. IF YOU HAVE
ALREADY TENDERED TO WINDY CITY AND WANT TO TENDER TO US INSTEAD, BE SURE TO SEND
WINDY CITY A WITHDRAWAL NOTICE IN ACCORDANCE WITH THE TERMS OF ITS OFFER.
You should also take these factors into account in considering the Offer.
o If you are the record owner of Units and you tender your Units to us in the
Offer, you will not have to pay transfer fees, brokerage fees or similar
expenses. The Partnership typically charges a transfer of fee $50 per Unit
holder, and brokers charge sales commissions generally equal to the greater
of $200 or 7-8% of gross proceeds, which you will not have to pay here. If
you own your Units through a broker or other nominee, and your broker
tenders your Units on your behalf, your broker or nominee may charge you a
fee.
o There is no established public market for the Units, although there is a
limited secondary market. If you sell on the secondary market, you may
receive a higher or lower price than our Purchase Price or the historical
prices described above.
o The tender of your Units may be withdrawn at any time prior to the
expiration date of the Offer, including any extensions. Also, if we have
not purchased your Units by September 22, 2003, you may withdraw them at
any time thereafter until we purchase your Units.
o By tendering, you will give up the opportunity to participate in any future
benefits of ownership, including potential future distributions by the
Partnership. Our Purchase Price may be less than the total amount that you
might otherwise receive with respect to your Units over the remaining term
of the Partnership.
o Our obligation to purchase Units is subject to our right to prorate among
tendering Unit holders the number of Units we will purchase, as well as
other conditions set forth in our Offer to Purchase. We will purchase in
our Offer a maximum of 59% of the outstanding Units. If Unit holders offer
us more Units, we will prorate our purchase ratably to all sellers.
o One of the conditions of our Offer is our receiving valid tenders, not
withdrawn, of at least 58,200 Units. When taken together with the Units
that we already own, that will give us the ownership of 50.1% of the Units,
which will give us the ability to control many decisions of the Unit
holders. Please see Section 7 of our Offer, "Purposes and Effects of the
Offer", for a description of those decisions. We have set a price that in
our opinion will induce Unit holders to tender while allowing us to profit
from ownership of the Units. Therefore, our interests may conflict with
yours. We have not calculated a control premium in establishing our
Purchase Price for your Units.
o While we are offering you a higher cash price per Unit than Windy City and
will pay the $50 transfer fee, we will not pay you interest on our Purchase
Price. Windy City states that it will pay 3% p.a. from the time they accept
your Units until the time they actually pay you.
o The General Partner is expected to announce a recommendation regarding our
Offer within 10 business days after the mail date of our Offer or as soon
as possible upon becoming aware of the Offer. You may consult with the
General Partner before deciding whether or not to tender our Units.
TO ACCEPT OUR OFFER:
1. Please complete the enclosed Agreement of Sale (if not otherwise indicated,
please note the number of units you wish to sell in the signature area of
the Agreement), and have it MEDALLION SIGNATURE GUARANTEED (this can be
done by your broker or a bank where you have an account).
2. Return the completed Agreement to us in the enclosed pre-addressed envelope
OUR OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK TIME, ON AUGUST 22, 2003, SUBJECT
TO ANY EXTENSION. We encourage you to act promptly. Our Offer will remain open
at least ten business days following any reduction in our purchase price
resulting from a distribution made by the Partnership. By accepting the Offer,
you will agree that we are entitled to all distributions made by the Partnership
on or after July 7, 2003. Unless the General Partner pays the distribution
directly to us or you remit the amount of the distribution to us, we will reduce
our purchase price by the amount of the distribution. If the Offer is extended
or a distribution occurs within the Offer period, we will make a public
announcement. We reserve the right to extend, amend or terminate our Offer.
BEFORE TENDERING, BE SURE TO READ "RISKS AND FACTORS TO CONSIDER BEFORE
TENDERING" IN THE OFFER TO PURCHASE
Please consider the Offer carefully. If you have any questions, please telephone
us at (800) 547-0854. Thank you for your consideration.
Very truly yours,
Kalmia Investors, LLC
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KALMIA IS NOT AN AFFILIATE OF THE GENERAL PARTNER OR OF THE PARTNERSHIP. PLEASE
CAREFULLY REVIEW THE ENCLOSED OFFER. AN AGREEMENT OF SALE IS ENCLOSED; IN ORDER
TO TENDER YOUR UNITS YOU MUST PROPERLY COMPLETE AND DULY EXECUTE THE AGREEMENT
OF SALE IN ACCORDANCE WITH THE INSTRUCTIONS AND RETURN IT TO US.
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THIS LETTER IS NEITHER AN OFFER TO PURCHASE, NOR A SOLICITATION OF AN OFFER TO
SELL THE UNITS. THE OFFER IS MADE ONLY BY THE OFFER TO PURCHASE AND THE RELATED
AGREEMENT OF SALE AND IS NOT BEING MADE TO (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.
Our Offer will expire at 5:00 pm, Eastern Time on August 22, 2003, unless the
Purchaser, in its sole discretion, shall have extended the period of time for
which the Offer is open.
OUR OFFER CONTAINS IMPORTANT INFORMATION WHICH SHOULD BE READ CAREFULLY BEFORE
ANY DECISION IS MADE WITH RESPECT TO THE OFFER.
21919.0001 #413229