UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No.3)*
SHELBOURNE PROPERTIES III, INC.
(Name of Issuer)
Common Stock, $0.01 Par Value
(Title of Class of Securities)
82137E103
(CUSIP Number)
Marc Weitzen, Esq.
General Counsel,
Icahn Associates Corp.
767 Fifth Avenue, 47th Floor
New York, New York 10153
(212) 702-4388
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
August 2, 2002
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition that is the subject of this Schedule 13D, and is filing
this schedule because of Section 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g),
check the following box / /.
NOTE: Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See Rule 13d-7 for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
SCHEDULE 13D
Item 1. Security and Issuer
This Amendment No. 3 to Schedule 13D, which was filed with the Securities
and Exchange Commission (the "SEC") on August 1, 2002, relates to the common
stock, $.01 par value (the "Shares"), of Shelbourne Properties III, Inc., a
Delaware corporation (the "Issuer"). The address of the principal executive
offices of the Issuer is c/o First Winthrop Corporation, 7 Bulfinch Place, Suite
500, Boston, MA 02114.
Item 4. Purpose of Transaction
Item 4 is amended to add the following:
On August 2, 2002, Carl C. Icahn delivered a letter to the board of
directors of the Issuer, which letter is attached hereto as Exhibit 1 and
incorporated herein in its entirety. The Registrants are aware of the press
release by HX Investors, L.P. describing agreements reached by HX Investors,
L.P. and the Issuer. In light of the press release, the Registrants will not
proceed with the tender offer and other transactions set forth in the letter.
Item 6. Contracts, Arrangements, Understandings or Relationship with
Respect to Securities of the Issuer.
Except as described herein, none of the Registrants has any contracts,
arrangements, understandings or relationships (legal or otherwise) with any
person with respect to any securities of the Issuer, including but not limited
to the transfer or voting of any of the securities, finder's fees, joint
ventures, loan or option arrangements, puts or calls, guarantees of profits,
division of profits or losses, or the giving or withholding of proxies.
Item 7. Material to be Filed as Exhibits
1. Letter to the board of directors of the Issuer dated August 2, 2002
SIGNATURE
After reasonable inquiry and to the best of each of the undersigned
knowledge and belief, each of the undersigned certifies that the information set
forth in this statement is true, complete and correct.
Dated: August 5, 2002
LONGACRE CORP.
By: /s/ Edward E. Mattner
Name: Edward E. Mattner
Title: President
/s/ Carl C. Icahn
Carl C. Icahn
[Signature Page of Amendment No. 3 to Schedule 13D
with respect to Shelbourne Properties III, Inc.]
Exhibit 1
CARL C. ICAHN
767 FIFTH AVENUE
SUITE 4700
NEW YORK, NEW YORK 10153
August 2, 2002
The Boards of Directors of
Shelbourne Properties I, Inc.
Shelbourne Properties II, Inc.
Shelbourne Properties III, Inc.
527 Madison Avenue - 16th Floor
New York, New York 10022
Gentlemen:
We have been engaged in discussions contemplating that my affiliated
companies ("Purchaser"), enter into agreements with Shelbourne Properties I,
Inc., Shelbourne Properties II, Inc., and Shelbourne Properties III, Inc.
(collectively, the "Companies"), with respect to tender offers for shares of the
Companies and the liquidation of their assets.
You are hereby advised that we are prepared to complete the transaction as
we have proposed it to you at the purchase price for shares of the Companies as
set forth below:
Icahn
Purchase Price Number of Shares
HXD $63.15 251,785
HXE $73.85 268,444
HXF $58.30 236,631
We would also agree to add to the Stock Purchase Agreements the following
undertakings and covenants which you designated as significant:
1. The Equity Amount for each Company in the calculation of "Net Proceeds"
will be modified to equal the greater of (i) the current Equity Amount as set
forth in the Plan of Liquidation or (ii) the revised tender offer price in the
final Ashner offer multiplied by the current outstanding number of shares in
such Company.
2. Purchaser will agree not to acquire or have one of its affiliates
acquire any property of the Companies or support a sale of any property of a
Company to Northstar Capital Investment Company or its affiliates.
3. Purchaser's non-independent nominees to the Board of Directors of the
Companies will, subject to their fiduciary duties and existing obligations of
the Companies, support and recommend the implementation of the following
distribution policy for the Companies:
a. The Companies will make quarterly distributions of all operating
cash flow in excess of budgeted capital expenditures, anticipated
corporate expenses and a reserve of 2% of the current appraised value
of the applicable properties.
b. 80% of each Company's current excess net cash will be used to retire
existing debt and/or make a distribution to stockholders on or before
90 days following the election of nominees of Purchaser as directors of
such Company.
4. The Plans of Liquidation to be submitted for stockholder approval will
be drafted to provide that:
a. All excess refinancing proceeds, if any, will be distributed within
the earlier of 30 days following the quarter in which such refinancing
occurs or 90 days following the refinancing.
b. All net property sale proceeds, if any, will be distributed within
the earlier of 30 days following the quarter in which such refinancing
occurs or 90 days following the refinancing.
5. The Plans of Liquidation to be submitted for stockholder approval will
be drafted to provide that, unless otherwise approved by stockholders not
affiliated with Purchaser and so long as a majority of the Boards of Directors
consist of members nominated by Purchaser, or by persons nominated by such
nominees, the failure to observe the distribution policy set forth in Paragraph
4 above shall result in each of the following:
a. Permanent elimination of the Incentive Payment.
b. Elimination of any service fees payable to affiliates of Purchaser
by the Companies during the period in which the distribution was
delayed.
c. Elimination of any fees payable to directors (other than those of
objecting directors) of the Companies during the period in which the
distribution was delayed.
6. If prior to any date set forth below, stockholders shall not have
received aggregate distributions equal on a per share basis to:
By 12/31/04 By 12/31/05 By 12/31/06
Shelbourne Properties I, Inc. $16.00 $32.00 $48.00
Shelbourne Properties II, Inc. $18.66 $37.33 $56.00
Shelbourne Properties III, Inc. $14.66 $29.33 $44.00
then Purchaser will vote its shares at the next annual meeting of
stockholders following the first such failure for the applicable Company(ies) in
proportion to the stockholders not affiliated with Purchaser on all matters
properly brought before the meeting and the applicable Company(ies) will
endeavor to cause such meeting to be held not later than May 30, 2005; May 30,
2006 and May 30, 2007, as applicable.
7. If any of the Plans of Liquidation are not approved after being subject
to stockholder vote, subject to their fiduciary duty, the nominees of Purchaser
will use commercially reasonable efforts to market and sell the property located
at 568 Broadway, New York, New York and to distribute the proceeds therefrom
within the earlier of 30 days following the quarter in which such sale occurs or
90 days following the sale.
8. As a part of the Stock Purchase Agreement, I would agree that upon
payment of the break-up fee (up to the existing $1.5 million obligation) to the
Ashner group, I will reimburse the Companies for such amounts when paid.
If there are additional matters that should be addressed, or additional
matters raised in the bid by the Ashner group, please contact us so that we may
respond promptly.
Very truly yours,
/s/ Carl C. Icahn
Carl C. Icahn