UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
___________________
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date of
Report (Date of earliest event reported): January 21, 2009 (January
16, 2009)
(Exact
name of registrant as specified in its charter)
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Maryland
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000-50256
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76-0594970
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(State
or Other Jurisdiction of Incorporation)
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(Commission
File Number)
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(I.R.S.
Employer
Identification
No.)
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2600
South Gessner, Suite 500, Houston, Texas 77063
(Address
of principal executive offices) (Zip Code)
(Registrant's
telephone number, including area code)
(Former
name or former address, if changed since last report)
Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions (see General Instruction A.2.
below):
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o
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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o
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
1.01
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Entry
into a Material Definitive
Agreement.
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On
January 16, 2009, Whitestone REIT (the “Company”),operating through Whitestone
REIT Operating Partnership, L.P. (the “Operating Partnership”), acquired
Spoerlein Commons, a mixed use-garden style complex of retail, medical, and
professional office tenants located in Buffalo Grove, Illinois (the
“Property”). The Operating Partnership acquired the Property pursuant
to the terms and conditions of the purchase, sale and contribution agreement
dated December 18, 2008 (the “Agreement”) between the Operating Partnership and
Bank One, Chicago, NA, as trustee under the Trust Agreement dated January 29,
1986 and known as Trust Number TWB-0454 (“Seller”). Midwest Development Venture
IV, an Illinois limited partnership (“Midwest”), is the sole beneficiary of the
Seller under the Trust Agreement.
The Property represents an acquisition
for the Company, and a substantial equity investment on behalf of the Seller. In
exchange for the Property, the Operating Partnership paid Seller $5,500,000,
received credit for net prorations of $275, 854 and issued 703,912 Units of the Operating Partnership (the
“Units”), valued at $5.15 per Unit, for a total purchase price of
$9,401,000.
Midwest,
the sole beneficiary of the Seller, is entitled to all earnings and proceeds
from the sale of the Property. James C. Mastandrea, our Chairman, President and
Chief Executive Officer, is the controlling limited partner in Midwest and as
such, had an ownership interest in the Property and is entitled to a portion of
the proceeds from the sale of the Property to the Operating Partnership. Because
of Mr. Mastandrea’s relationship with the Seller, a special committee of the
independent members of the Board of Trustees including Donald F. Keating, Jack
L. Mahaffey, and Chris A. Minton determined the terms of the transaction, which
included the use of an independent appraiser to value the Property.
No
brokerage commission was paid by the Company for this acquisition, and in
relation to Mr. Mastandrea’s investment, there was no front end load, meaning
that 100% of the amount paid is working for the benefit of the Company’s
shareholders.
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Item
3.02
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Unregistered
Sales of Equity Securities.
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The
disclosure contained in Item 1.01 above is incorporated in this Item 3.02 by
reference.
In
connection with the closing of the Property and the investment on behalf of the
Seller, the Operating Partnership issued 703,912 Units to Midwest for its
contribution of the Property to the Operating Partnership. The Units
were issued in reliance on the exemption from registration provided by Section
4(2) under the Securities Act of 1933, as amended. The issuance was not effected
using any form of general advertising or general solicitation and the issuance
was made to a qualified investor.
The Units
are convertible on a one-for-one basis into Common Shares of the Company at any
time after July 1, 2009 in
accordance with the terms of the Operating Partnership’s Limited Partnership
Agreement, as amended (the “Limited Partnership Agreement”). The
Seller will not be entitled to any dividends or distributions with respect to
the Units prior to June 30, 2009.
In the event James C. Mastandrea is not
re-elected as a trustee of the Company at the 2009 Annual Meeting of
Shareholders and appointed Chairman, President and Chief Executive Officer for
any reason, the Operating Partnership would be obligated to repurchase the Units
or any Common Shares issued upon conversion of the Units (as the case may
be), in cash for
$5.15 for each Unit or Common Share issued to Midwest in connection with the
sale of the Property discussed above.
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Item
9.01
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Financial
Statements and Exhibits.
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(d)
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Exhibits.
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Exhibit
99.1
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Press
Release dated January 21, 2009 |
SIGNATURE
Pursuant to the requirements of the
Securities Exchange Act of 1934, the Registrant has duly caused this report to
be signed on its behalf by the undersigned, hereunto duly
authorized.
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Date:
January 21, 2009
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WHITESTONE
REIT
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By:
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/s/
David K. Holeman
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David
K. Holeman
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Chief
Financial Officer
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