SEC Comment Letter for Whitestone REIT (WSR) (CIK 0001175535) (WSR) — Dec 12, 2006
Whitestone REIT (WSR) (CIK 0001175535)
Date: Dec. 12, 2006 · CIK: 0001175535 · Accession: 0000000000-06-060705
AI Filing Summary & Sentiment
File numbers found in text: 000-50256
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-3628
DIVISION OF
CORPORATION FINANCE
December 7, 2006
VIA FACSIMILE (972) 291-0715
Patricia Jordaan, Esq.
The Jordaan Law Firm
2911 Turtle Creek Blvd.
Dallas, Texas 75219
(972) 291-0715
Re: Hartman Commercial Properties REIT
Preliminary Consent Solicitation Stat ement filed by Allen R. Hartman and
Hartman Management, L.P. on November 29, 2006
File Number: 000-50256
Dear Ms. Jordaan:
We have reviewed your above-referenced filing and have the following comments.
Schedule 14A
1. In your future filings, please be mindful of your obligations under Rule 14a-9. In this regard, support for each statement of belief or opinion must be self-evident, disclosed in your filings
or provided to the staff on a supplemental ba sis. Some examples of what, depending upon
particular facts and circumstances, may be misleading within the meaning of Rule 14a-9 may include material which directly or indirec tly impugns character, integrity or personal
reputation, or directly or indi rectly makes charges concerning improper, illegal or immoral
conduct or associations without factual foundation. See Note to Rule 14a-9 under Regulation
14A. Examples of some of the statements in your filing that either should not be made in
future filings, or must be supported, incl ude, but are not limited to the following:
• We believe that the current Board as consti tuted and the current management team, with
James C. Mastandrea, as Chairman and CEO, are not the right trustees to manage The
Hartman REIT;
• We believe that the Mastandrea Board is not pursuing the most effective plan to protect
and enhance your investment in The Hartman REIT; and
• We believe that the long-term strategy form ulated by the Hartman Parties is the better
alternative to enhance your shareholder value.
Patricia Jordaan, Esq.
The Jordaan Law Firm December 7, 2006 Page 2
Question: Why do you believe th e Mastandrea Board is not the ri ght leadership to manage the
H a r t m a n R E I T ? P a g e 6
2. Please amend your disclosure throughout this section to identify the casual relationship
between the question you pose and the “answer s” you provide. For example, it is not
clear how Mr. Mastandrea’s serving as pres ident and CEO of two public companies is a
“conflict of interest” or a “breach of duties of loyalty and care” to shareholders. Explain how Mr. Mastandrea’s compensation to serv e as Paragon’s officer and director makes
him not the right leadership. Explain what a withdrawn registration statement has to do
with your allegation of “failed strategy” at being a public company. Explain how the
information regarding Paragon’s shell status discredits Mr. Mastandrea and “his” board.
3. Provide us with support in a supplemental resp onse as to the nature of the notification by
Amex to Paragon described on page 7.
B, page 9
4. Amend your disclosure to provide support for your statement of belief that Mr.
Mastandrea has tortiously interfered with the Hartman Parties’ contractual relationships, breached existing agreements and exposed The Hartman REIT to significant legal liability.” You should explain in deta il what you mean even though support may be
included or outlined in your counterclaim filed in litigation.
Question: What is you r strategy going forward?
Continue Our Operating Strategy
5. Amend your disclosure to provide more deta ils as to your proposed strategy of (1)
focusing on Texas regionally, for example, id entify particular areas within Texas or
explain that this simply means limited to Te xas, if true; (2) dive rsification by property
type, identifying the types; and (3) conservative capital management.
6. We note your statement at the bottom of page 10 that “the current Board strategy has
been to raid Hartman Management, breach contractual agreements and expose The
Hartman REIT to material legal liability.” Amend your filing to explain in detail what
you mean by each allegation.
7. You state that you “believe the approval of [y]our Proposals will provide the Company
with a Board that is better suited to take d ecisive steps to maximize shareholder value.”
Identify the plans of your nominees that would enable the board to “maximize
shareholder value” and explain what ex actly you mean by the term “maximize
shareholder value.” Further, clarify what act ions the nominees would be taking with their
election.
Patricia Jordaan, Esq.
The Jordaan Law Firm December 7, 2006 Page 3
8. We note your statement on page 12 that “We believe the above information demonstrates that James Mastandrea’s business history is tainted. Allen Hartman’s history is one of
excellent performance and distributions fo r all company shareholders.” We do not
believe that the information presented in this preliminary consent solicitation statement adequately supports either of these statements. Please revise your disclosure to clarify
what you mean by “tainted” and “excellent ” and provide detailed support for each
statement. Alternatively, please remove the unsupported statements.
Form of Consent Card
9. Please mark your card as preliminary.
Closing Comment
We urge all persons who are responsible for the accuracy and adequacy of the disclosure
in the filings reviewed by the staff to be certain that they have provided all information investors
require. Since the filing persons are in possessi on of all facts relati ng to the filing persons’
disclosure, they are responsible for the accuracy and adequacy of the disclosu res they have made.
In connection with responding to our comme nts, please provide, in writing, a statement
from the filing persons acknowledging that:
the filing persons are responsib le for the adequacy and accuracy of the disclosure in
the filings;
staff comments or changes to disclosure in response to staff comments in the filings reviewed by the staff do not foreclose th e Commission from taking any action with
respect to the filing; and
the filing persons may not assert staff co mments as a defense in any proceeding
initiated by the Commission or any person under the federal secu rities laws of the
United States.
In addition, please be advised th at the Division of Enforcement has access to all information you
provide to the staff of the Division of Corporat ion Finance in our review of your filing or in
response to our comments on your filings.
*****
Patricia Jordaan, Esq.
The Jordaan Law Firm December 7, 2006 Page 4
If you do not agree with a comment, then te ll us why in your response. Your response
letter should be uploaded to EDGAR with the form type label “CORRESP” and linked to the
Exchange Act file number. Direct any questions to me at (202) 551-3257. You may also contact me via facsimile at (202) 772-9203. Please send a ll correspondence to us at the following ZIP
code: 20549.
Very truly yours,
Celeste M. Murphy
S p e c i a l C o u n s e l
Office of Mergers and Acquisitions