Subject: File No. 81-939
From: Christopher S. Armstrong
Affiliation: Attorney, Armstrong & Hastings, LLP
May 5, 2013
To Whom It May Concern:
My Company Retirement Plan holds for my benefit 3,200 shares of W2007 Grace Acquisition I, Inc. as a result of financial engineering which precipitated the termination of my Plan’s interest in Equity Inns Preferred Stock which was formerly listed and actively traded on the New York Stock Exchange.
The actions of Goldman Sachs (and its affiliate Whitehall Street Global Real Estate, LP) and Equity Inns company management in taking Equity Inns private in September 2007 resulted in a windfall for the common stockholders and the near destruction of the interests of the preferred shareholders for whose shares no tender was made. Company management was quoted at the time as saying: “Nothing has changed except the fact it’s not public anymore.”
This could not have been farther from the truth. The combination of the excessive leveraging of the properties formerly owned by the publicly traded Equity Inns, the delisting of the preferred stock and the suspension of dividend payments within months of the restructuring has resulted in a loss to my personal retirement plan well in excess of $75,000.
The exemptive relief sought by W2007 Grace from the requirement that it file reports under Section 15(d) of the Exchange Act is premised upon shamefully disingenuous representations.
- On information and belief W2007 Grace has not produced a record of shareholders for inspection by its shareholders. If one shareholder has been enterprising enough to form 300 trusts (no mean feat in my view as a tax and estate planning attorney with some comprehension of the work entailed to create a viable trust) in order to preclude W2007 Grace management from escaping such reporting obligations as might otherwise be imposed upon it, that intrepid shareholder’s efforts should not be nullified by the Securities and Exchange Commission.
- There is limited trading activity in the shares of W2007 Grace because W2007 Grace management delisted the company and made trading extremely difficult.
- If in fact W2007 Grace does not engage in active operations, this is attributable exclusively to choices taken by management which transformed preferred share interests in Equity Inns a solid and well regarded company into ownership interests in a financially engineered shell.
- The burdens in the matter are of management’s making. It is the shareholders who have borne the pain of management’s actions. There is no reason for the Securities and Exchange Commission to exhibit sympathy for management and certainly no reason for it to relieve management of a requirement that it be transparent and forthcoming with shareholders.
Very Truly Yours,
Christopher S. Armstrong
Attorney, Armstrong & Hastings, LLP
100 Spear Street, Suite 1435
San Francisco, CA 94105