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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

     
[X]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
     
    For the quarterly period ended June 30, 2003

OR

     
[  ]        TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
     
    For the transition period from_______________________to_____________________
     
    Commission file number 0-17660

METRIC PARTNERS
GROWTH SUITE INVESTORS, L.P.,

a California Limited Partnership

(Exact name of Registrant as specified in its charter)
     
CALIFORNIA   94-3050708

 
(State or other jurisdiction of incorporation or organization)   (I.R.S. Employer Identification No.)
     
One California Street
San Francisco, California
  94111-5415

 
(Address of principal executive offices)   (Zip Code)
     
Registrant’s telephone number, including area code:   (415) 678-2000
    (800) 347-6707 in all states

     Indicate by check mark whether the registrant (1) has filed all the reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [  ]

Indicate by checkmark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes [  ] No [X]



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PART 1 FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited).
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Item 4. Controls and Procedures
PART II OTHER INFORMATION
Item 1.Legal Proceedings
Item 4. Submission of Matters to Vote of Security Holders
Item 6. Exhibits and Reports on Form 8-K
SIGNATURE
Exhibit 31.1
Exhibit 31.2
Exhibit 32.1


Table of Contents

PART 1

FINANCIAL INFORMATION

Item 1.   Financial Statements (Unaudited).

METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.,
a California Limited Partnership

BALANCE SHEETS

                   
      June 30,        
      2003   December 31,
      (Unaudited)   2002
     
 
ASSETS
               
Cash and Cash Equivalents
  $ 2,307,000     $ 1,987,000  
Restricted Cash
    5,000,000       5,000,000  
 
   
     
 
TOTAL ASSETS
  $ 7,307,000     $ 6,987,000  
 
   
     
 
LIABILITIES AND PARTNERS’ EQUITY
               
Other Liabilities
  $ 15,000     $ 44,000  
 
   
     
 
TOTAL LIABILITIES
    15,000       44,000  
 
   
     
 
PARTNERS’ EQUITY
               
General Partners
    (914,000 )     (914,000 )
 
Limited Partners (59,919 Units Outstanding)
    8,206,000       7,857,000  
 
   
     
 
TOTAL PARTNERS’ EQUITY
    7,292,000       6,943,000  
 
   
     
 
TOTAL LIABILITIES AND PARTNERS’ EQUITY
  $ 7,307,000     $ 6,987,000  
 
   
     
 

See notes to financial statements (unaudited).

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METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.,
a California Limited Partnership

STATEMENTS OF OPERATIONS (UNAUDITED)

                 
    For the Six Months Ended
    June 30,
   
    2003   2002
   
 
REVENUES:
               
Interest and Other
  $ 565,000     $ 66,000  
 
   
     
 
Total Revenues
    565,000       66,000  
 
   
     
 
EXPENSES:
               
General and Administrative
    216,000       203,000  
 
   
     
 
Total Expenses
    216,000       203,000  
 
   
     
 
NET INCOME (LOSS)
  $ 349,000     $ (137,000 )
 
   
     
 
NET INCOME (LOSS) PER LIMITED PARTNERSHIP ASSIGNEE UNIT
  $ 6     $ (2 )
 
   
     
 

See notes to financial statements (unaudited).

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METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.,
a California Limited Partnership

STATEMENTS OF OPERATIONS (UNAUDITED)

                 
    For the Three Months Ended
    June 30,
   
    2003   2002
   
 
REVENUES:
               
Interest and Other
  $ 545,000     $ 32,000  
 
   
     
 
Total Revenues
    545,000       32,000  
 
   
     
 
EXPENSES:
               
General and Administrative
    171,000       96,000  
 
   
     
 
Total Expenses
    171,000       96,000  
 
   
     
 
NET INCOME (LOSS)
  $ 374,000     $ (64,000 )
 
   
     
 
NET INCOME (LOSS) PER LIMITED PARTNERSHIP ASSIGNEE UNIT
  $ 6     $ (1 )
 
   
     
 

See notes to financial statements (unaudited).

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METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.,
a California Limited Partnership

STATEMENTS OF PARTNERS’ EQUITY (UNAUDITED)
For the Six Months Ended June 30, 2003 and 2002

                         
    General
Partners
  Limited
Partners
  Total
   
 
 
Balance, January 1, 2003
  $ (914,000 )   $ 7,857,000     $ 6,943,000  
Net Income
          349,000       349,000  
 
   
     
     
 
Balance, June 30, 2003
  $ (914,000 )   $ 8,206,000     $ 7,292,000  
 
   
     
     
 
Balance, January 1, 2002
  $ (914,000 )   $ 8,185,000     $ 7,271,000  
Net (Loss)
          (137,000 )     (137,000 )
 
   
     
     
 
Balance, June 30, 2002
  $ (914,000 )   $ 8,048,000     $ 7,134,000  
 
   
     
     
 

See notes to financial statements (unaudited).

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METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.,
a California Limited Partnership

STATEMENTS OF CASH FLOWS (UNAUDITED)

                     
        For the Six Months Ended
        June 30,
       
        2003   2002
       
 
OPERATING ACTIVITIES
               
Net Income (Loss)
  $ 349,000     $ (137,000 )
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided (Used) by Operating Activities:
               
   
Changes in Operating Assets and Liabilities:
               
   
Other Liabilities
    (29,000 )     (18,000 )
 
   
     
 
Net Cash Provided (Used) by Operating Activities
    320,000       (155,000 )
 
   
     
 
 
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
    320,000       (155,000 )
Cash and Cash Equivalents at Beginning of Period
    1,987,000       2,302,000  
 
   
     
 
CASH AND CASH EQUIVALENTS AT END OF PERIOD
  $ 2,307,000     $ 2,147,000  
 
   
     
 

See notes to financial statements (unaudited).

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METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.,
a California Limited Partnership

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

1.   Reference to the 2002 Audited Financial Statements
 
    These unaudited financial statements should be read in conjunction with the Notes to Financial Statements included in the 2002 audited financial statements.
 
    The financial information contained herein reflects all normal and recurring adjustments that are, in the opinion of management, necessary for a fair presentation.
 
2.   Transactions with the Managing General Partner and Affiliates
 
    In accordance with the Partnership Agreement, Metric Partners Growth Suite Investors, L.P., (“the Partnership”) is charged by the Managing General Partner and Affiliates for services provided to the Partnership. The Partnership was charged for $6,000 for reimbursement of administrative expenses in each of the three month periods ended June 30, 2003 and 2002.
 
    As discussed in Note 2 to the 2002 audited financial statements, pursuant to the Partnership Agreement, immediately prior to liquidation and if certain distribution levels to the limited partners are not met, the general partners may be obligated to return all or a portion of the cumulative amounts received in distributions. At June 30, 2003 such amount is approximately $914,000 and the Partnership believes circumstances will be such that the general partners will be required to re-contribute this amount.
 
3.   Net Income Per Limited Partnership Assignee Unit
 
    The net income per limited partnership assignee Unit is computed by dividing the net income allocated to the limited partners by 59,919 assignee Units outstanding.
 
4.   Restricted Cash
 
    The $5,000,000 restricted cash balance represents the amount, which (as discussed in Part II, Item 1) the Court enjoined the Partnership from conveying, transferring, or otherwise disposing of.
 
5.   Legal Proceedings
 
    The Partnership is a plaintiff and counterclaim defendant in legal proceedings relating to the management agreement at the Residence Inn – Ontario, a defendant in legal proceedings seeking damages for alleged failure to consummate a settlement of the Residence Inn – Ontario case, and a plaintiff and defendant in other legal proceedings; see Part II, Item 1, Legal Proceedings, for a detailed description of these matters.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

This Item should be read in conjunction with Financial Statements and other Items contained elsewhere in this Report.

Results of Operations

During the six months ended June 30, 2003 and 2002, the Partnership had a net income (loss) of $349,000 and $(137,000), respectively. Income for 2003 consisted mainly of $525,000 settlement payment received by the Partnership on June 6, 2003. See Part II, Item 1 of this quarterly report for a detailed description of this matter. Income for 2002 consisted solely of interest income. As the partnership ceased hotel operations in 1999, expenses for both periods reflect legal fees and administrative expenses.

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Partnership Liquidity and Capital Resources

Second Quarter of 2003

As stated in the Statement of Cash Flows for the six months ended June 30, 2003, cash was generated from the settlement payment and from interest income on Cash and Cash Equivalents as well as Restricted Cash balances. Cash was used to pay for legal and administrative expenses of the Partnership.

Legal and administrative expenses increased during the second quarter of 2003 primarily as a result of responses to a tender offer for a majority of the Partnership’s Units and consent solicitations made in May 2003. The Managing General Partner filed with the SEC and sent to Unit holders on May 28, 2003 a Schedule 14D-9 Statement recommending that holders reject this tender offer and consent solicitations. The Partnership also filed a lawsuit seeking to enjoin these proposals; see Part II, Item 1, Legal Proceedings, for a description and status of this lawsuit.

Second Quarter of 2002

As stated in the Statement of Cash Flows for the six months ended June 30, 2002, cash was generated from interest income on Cash and Cash Equivalents as well as Restricted Cash balances. Cash was used to pay for legal and administrative expenses of the Partnership.

Conclusion

As discussed in Note 4 of the 2002 audited financial statements, there is substantial doubt regarding the Partnership’s ability to continue as a going concern.

Item 3.   Quantitative and Qualitative Disclosures about Market Risk

Not applicable.

Item 4.  Controls and Procedures

(a)  Evaluation of Disclosure Controls and Procedures. At the end of the period covered by this report as required by paragraph (b) of Rule 13a-15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Partnership carried out an evaluation, with the participation of the Chief Executive Officer and Chief Financial Officer of Metric Realty, the Managing General Partner of the Partnership, of the effectiveness of the Partnership’s disclosure controls and procedures (as such term is defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act). Based on such evaluation, such officers have concluded that, as of such date, the Partnership’s disclosure controls and procedures are effective in alerting them on a timely basis to information relating to the Partnership required to be disclosed by the Partnership in the reports that it files or submits under the Exchange Act.

(b)  Changes in Internal Controls. There have not been any changes in the Partnership’s internal control over financial reporting that occurred during the Partnership’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Partnership’s internal control over financial reporting.

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PART II

OTHER INFORMATION

Item 1.  Legal Proceedings

Metric Partners Growth Suite Investors, L.P. vs. Kenneth E. Nelson, The Nelson Group, et al., San Francisco County Superior Court, Case No. 928065 (the “SF Lawsuit”). [The lawsuits described below are related. Terms defined in the description of one case may be used in the description of the other cases.]

This lawsuit related to disputes in connection with management of the Partnership’s Residence Inn – Ontario by an entity controlled by Kenneth E. Nelson (“Nelson”) from April 1988 to February 1991. In March 1993, the Partnership and Nelson verbally agreed to settle the SF Lawsuit at a settlement conference (the “SF Settlement”), whereby the Partnership would purchase, at a discount, the land (the “Land”) underlying the Hotel then leased by the Partnership from Nashville Lodging Company (“NLC”), an entity controlled by Nelson. Various disagreements between the Partnership and Nelson regarding the SF Settlement arose after March 1993, and documents to effectuate the SF Settlement were never executed. While the Court maintains jurisdiction to supervise the SF Settlement, this action is no longer active.

Nashville Lodging Company vs. Metric Partners Growth Suite Investors, L.P. et al., Circuit Court, State of Wisconsin, Case No. 94CV001212.

In February 1994, NLC served this lawsuit on the Partnership. NLC alleges fraud, breach of settlement contract and breach of good faith and fair dealing and seeks compensatory, punitive and exemplary damages in an unspecified amount for the Partnership’s failure to consummate the SF Settlement. In February 1994, the Partnership filed an answer and requested that the Court stay the action pending resolution of the SF Lawsuit including all appeals. The Court refused to stay the action and discovery commenced. In February 1995, the Court determined that the Partnership could be sued in Wisconsin but stayed the case until the settlement of the SF Lawsuit has been finalized.

Orlando Residence Ltd. vs. 2300 Elm Hill Pike, Inc. and Nashville Lodging Company vs. Metric Partners Growth Suite Investors, L.P., Chancery Court for Davidson County, in Nashville, Tennessee, Case No. 94-1911-I (“Nashville Case I”).

Orlando Residence Inn Ltd. (“Orlando”) filed this action against 2300 Elm Hill Pike, Inc. (“2300”) and NLC in the Davidson County Chancery Court to attempt to execute a judgment against Nelson, NLC and 2300 in another action in Chancery Court by subjecting the Land to sale. In May 1995, 2300 and NLC (“TP Plaintiffs”) filed a third-party complaint against the Partnership, alleging it had refused to purchase the Land as required by the SF Settlement. TP Plaintiffs demanded payment by the Partnership of 2300 and NLC’s costs of defending the case in which the judgment that Orlando was attempting to enforce had been obtained and indemnification for any loss resulting from the claims of Orlando, among other claims of damage.

In February 1996, the Court granted a motion filed by TP Plaintiffs for partial summary judgment, ruling that the Partnership had breached the SF Settlement. The Partnership does not believe it breached the SF Settlement.

In late October 1997, TP Plaintiffs filed a motion for an injunction to prohibit the Partnership from distributing proceeds from the sale of the Residence Inns owned by the Partnership, pending a final judgment in this case. A hearing on this motion was held in February 1998 and the Court enjoined the Partnership from conveying, transferring, distributing or otherwise disposing of its cash to any extent which would leave less than $5 million available for payment of any judgment obtained by TP Plaintiffs.

TP Plaintiffs filed an amended complaint against the Partnership in April 1998, asserting, among other things, a bad faith breach of contract by the Partnership. In May 1998, the Court granted a motion by the Partnership to dismiss these bad faith allegations and to dismiss certain claims for specific damages made by TP Plaintiffs, including attorneys’ fees and the value of Nelson’s time relating to efforts to enforce the SF Settlement.

In late October 1998, TP Plaintiffs filed a second amended complaint, asserting that a certain 1989 three-party agreement among NLC, the Partnership and the holder of a mortgage on the Hotel and the Land entitles TP Plaintiffs to obtain judgment for, among other things, the cost, including attorney’s fees, of this action and of Nelson’s time and efforts on behalf of NLC in this action. In November 1998, the Court granted a motion filed by the Partnership, dismissing the claim of TP Plaintiffs to recover for the value of Nelson’s time and efforts on behalf of NLC in this and related litigation.

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In December 1998, the Court granted a motion for partial summary judgment filed by the Partnership, dismissing most of the remaining damage claims of TP Plaintiffs, including claims for indemnification for any loss resulting from the claims of Orlando. After these claims were dismissed, TP Plaintiffs amended their damage claim to seek to recover the alleged differential between the price that the Partnership agreed to pay for the Land and its alleged fair market value. The amount of this claim is approximately $1.6 million. In addition, TP Plaintiffs sought to recover attorneys’ fees to enforce the SF Settlement.

In November 1999, the Partnership filed a motion for summary judgment seeking dismissal of TP Plaintiffs’ claim for attorneys’ fees. This motion was granted by the Court on February 25, 2000.

On December 21, 2000, the TP Plaintiffs filed a motion requesting that the Court reconsider its order of December 1998, granting partial summary judgment to the Partnership. This motion was denied by the Court on January 26, 2001.

The trial of the claim of the TP Plaintiffs remaining in this case, scheduled for December 17, 2001, was postponed to February 11, 2002. Trial did start on this date, but on February 13, 2002, the Judge declared a mistrial as a result of events unrelated to this action. A new trial was scheduled for September 16, 2002.

On April 5, 2002, TP Plaintiffs filed a motion for leave to amend their complaint to allege damages resulting from alleged interference by the Partnership with NLC’s efforts to sell the Land and to compute NLC’s “benefit of bargain” damages as of the date of the trial, rather than the date of the breach of the SF Settlement. On May 3, 2002 the Partnership filed a response to the motion denying the allegations of the proposed amendment and seeking a ruling barring the filing of the amended complaint. The Court denied the motion on May 29, 2002.

On September 3, 2002, the TP Plaintiffs and the Partnership signed and the Court entered an agreed final order under which the TP Plaintiffs waived their sole remaining damage claims. All other damage claims asserted by the TP Plaintiffs in the case had been dismissed by prior orders of the Court. The effect of the order is a final judgment of no damages for the TP Plaintiffs. The agreed final order was proposed by the TP Plaintiffs, who have filed a notice of appeal of the final judgment with the Tennessee Court of the Appeals. In connection with this appeal, the Partnership will seek to have the judgment upheld, but if the Court of Appeals should determine to overturn any of the lower Court rulings in favor of the Partnership and remand the case to the lower Court, the Partnership will also seek reversal of the lower court ruling that the Partnership breached the SF Settlement. The parties have filed briefs with the Tennessee Court of Appeals and are awaiting notice of the date of oral argument.

Metric Partners Growth Suite Investors, L.P., vs. Nashville Lodging Co., 2300 Elm Hill Pike, Inc., Orlando Residence Ltd., and LaSalle National Bank, as trustee under that certain pooling and servicing agreement, dated July 11, 1995 for the holders of the WHP Commercial Mortgage Pass Through Certificates, Series 1995C1 and Robert Holland, Trustee, Chancery Court for Davidson County, in Nashville, Tennessee, Case No. 96-1405-III (“Nashville Case II”).

The Partnership filed this action on May 3, 1996 to obtain, among other things, a judicial determination of the rights and obligations of the Partnership and NLC under the senior mortgage on the Hotel (“Senior Mortgage”), a note held by NLC “wrapped around” the Senior Mortgage (the “Wrap Note”) and the Lease as a consequence of the Partnership’s cure of certain defaults by NLC under the Senior Mortgage. The Partnership believed that as a result of such a cure, it became the direct obligor to the lender under the Senior Mortgage and that the Wrap Note had been satisfied and the payments due under Lease reduced by $50,000 per year.

NLC and 2300 filed an answer in June, together with a counterclaim against the Partnership. NLC and 2300 claimed damages from the Partnership and asked the Court to permit acceleration of the Wrap Note and termination of the Lease. In July 1996, the Partnership filed a motion for summary judgment in this case, asking that the Court award the relief sought by it and that the Court dismiss the counterclaim of NLC and 2300. At a hearing on this motion held in August 1996 the Court granted the Partnership’s motion. The defendants appealed all judgments for the Partnership in this case. The Partnership and the defendants agreed on an attorneys’ fee award to the Partnership of $60,000, but no payment was expected until the defendants’ appeal is resolved. Oral arguments regarding this appeal were held in July 1998, and in September 1998 the appellate court affirmed the judgments for the Partnership. Defendants moved for rehearing, which was denied in early October 1998. Defendants then filed an application with the Tennessee Supreme Court for permission to appeal the appellate court decision. This application was denied by the Tennessee Supreme Court in early March 1999. Subsequently, Defendants petitioned the Tennessee Supreme Court to reconsider its denial. This petition was denied by the Tennessee Supreme Court on May 10, 1999. The Partnership’s $60,000 attorneys’ fee award is now due and owing by the defendants.

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Metric Partners Growth Suite Investors, L.P. vs. James Reuben et al., San Francisco County Superior Court, Case No. 998214.

On September 30, 1998, the Partnership filed this lawsuit for unspecified damages against James Reuben and several law corporations of which he is or has been a member (the “Reuben Defendants”), alleging breach of their professional obligations and fiduciary duty as attorneys for the Partnership to adequately and competently represent and advise the Partnership in connection with the SF Settlement. The Reuben Defendants answered the complaint in January 1999. A trial date of this action was scheduled for May 12, 2003.

On April 25, 2003, the Partnership and the Reuben Defendants agreed to settle this action on the following principal terms and conditions: (i) on behalf of the Reuben Defendants, their malpractice insurer (“Insurer”) is to pay the Partnership $525,000 (the “Settlement Amount”) on or before June 2, 2003 and (ii) upon receipt of the Settlement Amount by the Partnership, the parties shall exchange mutual releases and the Partnership shall dismiss the complaint in this action with prejudice. The Settlement Amount was received by the Partnership in early June 2003, mutual releases were exchanged and the action was dismissed with prejudice by the Partnership on June 6, 2003.

GP Credit Co., LLC vs. Metric Partners Growth Suite Investors, L.P., Metric Realty, SSR Realty Advisors, Inc. et al, San Francisco County Superior Court, Case No. CGC-02-403301.

GP Credit Co., LLC (“GP”) filed this purported class action against the Partnership and Metric Realty, SSR Realty Advisors, Inc. (“SSR”) and certain of SSR’s affiliates and current and former employees (collectively, the “SSR Parties”) and a class of all limited partners of the Partnership (the “LPs”) alleging, among other things, that the SSR Parties fraudulently caused GSI to distribute $16.8 million to the LPs. GP, which claims to have purchased a claim owned by NLC, is demanding general and punitive damages against the Partnership and the SSR Parties and damages from the LPs with regard to the portion of this $16.8 million distribution received by each LP. Process was served on all non-LP defendants in March and April 2002 and answers have been filed on behalf of all non-LP defendants. A Court status conference previously set for March 14, 2003 has been continued to February 6, 2004.

Metric Partners Growth Suite Investors, L.P. vs. Kenneth E. Nelson, United States District Court for the Northern District of California, Case No. C 03-2523 CRB

On May 14, 2003 Nelson filed with the SEC and disseminated to each of the Partnership’s Unit holders a tender offer for a majority of the Metric units at $86 per unit and four consent solicitations, the approval of all of which are a precondition to Nelson’s tender offer. These conditions are (1) an amendment to the Partnership’s limited partnership agreement (the “Partnership Agreement”) that would allow a purchaser to acquire control of the Partnership; (2) removal of Metric Realty and affiliates as general partners; (3) election of Nelson as the sole general partner; and (4) settlement of pending litigation between Nelson, NLC, GP, LLC and the Partnership by entry of a judgment in favor of GP against the Partnership for $10 million, of which $4 million must be immediately paid to GP.

In response, Metric Realty filed a Schedule 14D-9 Statement with the SEC on May 28, 2003 recommending that the Unit holders reject Nelson’s tender offer and consent solicitations. Also, the Partnership filed on May 28, 2003 this lawsuit seeking to enjoin Nelson’s proposals on the principal legal grounds that Nelson’s tender offer and consent solicitations violate the procedural and substantive provisions of the Partnership Agreement, his disclosure materials contain misrepresentations and material omissions and his takeover plan would violate his fiduciary duty and aid and abet a breach of fiduciary duty by Partnership Unit holders.

On June 27, 2003, the Court issued a temporary restraining order halting Nelson’s proceeding with his tender offer and consent solicitations except that he may attempt to convene a vote of the Unit holders in accordance with the Partnership Agreement. This order was converted to a preliminary injunction on August 5, 2003 pursuant to a Court Order stipulated to by the parties.

Item 4.  Submission of Matters to Vote of Security Holders

As previously reported in Item 4, of Part II of the Partnership’s Form 10-Q for the quarter ended March 31, 2003, in February 2003, the Managing General Partner of the Partnership sent out a Solicitation Statement seeking Unit holder approval of a proposed amendment to the Partnership Agreement of the Partnership. The proposed amendment would have amended paragraph 12.3 of the Partnership Agreement to eliminate certain prohibitions of transfers of more than 5% of the Units in any calendar year and of more than 50% of the Units over any 12-month period. In order for the amendment to become effective it had to be approved by holders of more than 50% of the total outstanding Units by no later than May 8, 2003.

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The proposed amendment was not approved by the Unit Holders (approval would have required the affirmative vote of holders of at least 29,960 Units). The vote on the proposed amendment, which was conducted by a solicitation for consents from the Unit Holders, was as follows:

       
For
  21,964.28  
 
 
 
 
   
Against
  2,729.00  
 
 
 
 
   
Abstain
  581.00  
 
 
 
 
   

Item 6.  Exhibits and Reports on Form 8-K

  (a)   Exhibits

  31.1   Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
 
  31.2   Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
 
  32.1   Certification of CEO and CFO Pursuant to 18 U.S.C Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

  (b)   Reports on Form 8-K
 
      The Partnership filed a Form 8-K Report on May 16, 2003, making an Item 5 disclosure to disclose that a tender offer had commenced with respect to Partnership Units and to file a copy of correspondence sent by the Partnership to the Unit holders in connection with such tender offer.

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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, thereunto duly authorized.

  METRIC PARTNERS GROWTH SUITE INVESTORS, L.P.,
a California Limited Partnership

           
    By:   Metric Realty
an Illinois general partnership
its Managing General Partner
 
           
    By:   /s/ William A. Finelli  
       
 
        William A. Finelli
Chief Financial Officer
 
           
    Date:   August 14, 2003  
         

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