Hartman Group Challenges Silver Star Properties (SILV) Board, Seeks Stockholder Support to Elect New Directors and Pursue Liquidation Strategy

Summary

Dear Fellow Stockholders:

Allen R. Hartman, director of Silver Star Properties REIT, Inc. (the “Company” or “Silver Star”), and certain other stockholders, including Mr. Hartman’s affiliates, Hartman XX Holdings, Inc., Hartman vREIT XXI, Inc., Hartman Family Protection Trust, and his spouse Lisa Hartman, as well as Mr. Hartman’s adult daughters, Charlotte Hartman, Victoria Hartman Massey, and Margaret Hartman (collectively, the “Hartman Group” or “we”) is one of the largest stockholders of Silver Star Properties REIT, Inc. (“Silver Star” or the “Company”). We beneficially own 5,230,860 shares of the Company’s common stock, $0.001 par value per share (the “Common Stock”), representing approximately 7.76% of the issued and outstanding Common Stock.

The Hartman Group and the nominees named herein (together the “Participants” and each a “Participant”), seek your support at the Company’s upcoming annual meeting of stockholders on Monday, July 7, 2025 at 10:00 a.m. Central Time (the “Annual Meeting”). The Company has disclosed that the Annual Meeting will be held virtually. You will be able to attend the meeting by first registering at https://web.viewproxy.com/silverstarreit/2025 no later than July 7, 2025 at 9:00 a.m. Central Time. After registering, you will receive a meeting invitation and password by e-mail with your unique link to join the meeting. Stockholders will be able to listen, vote and submit questions during the virtual meeting. Holders of record of Company common stock as of May 21, 2025, are entitled to notice and to vote at the meeting. We need your vote to elect the Hartman Group’s three (3) highly qualified nominees to the Company’s board of directors (the “Board”). The Board needs to be meaningfully reconstituted to help ensure that the Company is being effectively run and to maximize stockholder value in a liquidation of the Company, if approved by stockholders at the Annual Meeting.

The Hartman Group and the Company will each be using a universal proxy card for voting on the election of directors at the Annual Meeting, which will include the names of all nominees for election to the Board. Stockholders will have the ability to vote for up to three (3) nominees on the Hartman Group’s enclosed BLUE universal proxy card. Any stockholder who wishes to vote for any combination of our nominees and the Company’s nominees may do so on the Hartman Group’s BLUE universal proxy card. There is no need to use the Company’s white proxy card or voting instruction form, regardless of how you wish to vote. In any case, we recommend that you vote in favor of our nominees, who we believe are most qualified to serve as directors in order to achieve a Board composition that we believe is in the best interest of all stockholders.

We urge you to carefully consider the information contained in the attached Proxy Statement and then support our efforts by signing, dating, and returning the enclosed BLUE universal proxy card today. You do not need to attend the Annual Meeting in order to vote. The attached Proxy Statement and the enclosed BLUE universal proxy card are first being furnished to stockholders on or about June 3, 2025.

The Hartman Group has been attempting since July 2023 to cause the Company to hold an annual meeting of stockholders for the election of directors so that stockholders can have a choice. The executive committee (the “Executive Committee”) of the Board, a committee constituted in October 2022 to exclude Mr. Hartman, who is nominally a member of the Board, from any decisions regarding the Company, previously attempted to entrench the current Executive Committee members by electing such persons by written consent to additional terms as directors. The Executive Committee attempted to act by written consent and not hold an actual meeting of stockholders, despite the fact that Silver Star has not held an annual meeting of stockholders as required by Maryland law since December 2011 – nearly fourteen years ago. In response, the Hartman Group filed and disseminated to stockholders a Consent Revocation Statement asking stockholders to reject the efforts of the Executive Committee to act without holding an annual meeting. This consent solicitation was not completed. On January 29, 2024, the court in the Maryland litigation commenced by Mr. Hartman issued a preliminary injunction prohibiting the Company from tallying the consents from stockholders for the election of directors that it had received. Accordingly, such directors were not elected to additional terms but continue to remain in their positions as entrenched holdovers.

In addition, the Hartman Group went to court in Maryland to seek to compel the Company to hold an annual meeting. On January 21, 2025, the Circuit Court for Baltimore City, Maryland issued an order that compelled the Company to hold an annual meeting of stockholders by no later than July 21, 2025 at which stockholders would be given the binary choice between liquidation of Silver Star’s assets on the one hand and deferring liquidation for the purpose of executing an alternative strategy on the other hand, as required by Maryland law and the terms of the Company’s Third Amended and Restated Articles of Incorporation dated March 5, 2010 (as amended, the “Articles”).

The Executive Committee did not want to submit to the scrutiny of Company stockholders or comply with the terms of the Company’s Articles, but has been compelled by court order to hold the Annual Meeting due in large part to the efforts of the Hartman Group. The Hartman Group strongly believes that the Company needs new leadership who will prioritize stockholder value rather than use Company funds to fight, ultimately unsuccessfully, for the right to continue to ignore calls from stockholders for an Annual Meeting. We are seeking to add three (3), highly qualified directors, committed to value preservation and serving the best interests of all stockholders to the Board: Allen R. Hartman, the Company’s former CEO, Brent Longnecker and Benjamin Thomas. In addition, we are asking Company stockholders to vote in favor of the liquidation of the Company and its assets and to vote against the so-called “pivot” to an alternative strategy that has been proposed by the Executive Committee. If our nominees are elected, they will work to ensure that the Company maximizes its net asset value (“NAV”) and return liquidity to stockholders by liquidating the Company’s assets in an orderly fashion and in the best interests of stockholders, should the Company’s stockholders not approve a pivot to the alternative strategy being aggressively promoted by the Executive Committee at the Annual Meeting.

If our Nominees are not elected at the Annual Meeting, we are concerned the members of the Executive Committee are unfit to carry out a liquidation strategy, let alone a new and untested strategy. Despite the clear provisions of the Articles requiring that the Company shall begin the process of liquidating the Company’s assets unless the Board of Directors has caused the Company’s Common Stock to be listed or quoted for trading on an established securities exchange within ten years of the termination of the Company’s initial public offering or unless the Board has obtained the approval of a majority of stockholders to defer the liquidation or to approve an alternate strategy, the Executive Committee went to court in its unsuccessful attempt to prevent stockholders from convening an Annual Meeting. Gerald Haddock, CEO and Executive Chairman of the Board, stated in a letter to stockholders that if the Company were to proceed with liquidation under his leadership, stockholders would suffer “significant reduction in net asset value (NAV) to possibly $0.40 per share or less and market value as low as $0.00.” If the Executive Committee’s assertions regarding NAV in a liquidation are indeed true, it would indicate that they have badly mismanaged the Company – perhaps that is why they fought so hard to prevent stockholders from having their say. Stockholders need to consider whether they want to leave their investment in the hands of a Board that has assembled a portfolio of assets that if liquidated promptly would yield little to no return for stockholders.

We believe that under the leadership of our nominees, the Company can achieve a NAV for stockholders in a liquidation that is far superior to the dismal picture of the Company’s assets painted by Mr. Haddock. Moreover, we believe that the Executive Committee’s behavior in seeking to block an annual meeting of stockholders shows that they are not responsive to stockholders and their concerns. Accordingly, we believe that stockholders should reject any alternative strategy which would give a management team with a horrible track record an additional opportunity to invest your capital in a new, untested strategy.

The Board is currently composed of four (4) directors, but the Company has indicated that only three (3) directors will be elected at the Annual Meeting. You may vote for up to three (3) directors in total. Through the attached Proxy Statement and enclosed BLUE universal proxy card, we are soliciting proxies to elect our three (3) nominees. Stockholders are permitted to vote for fewer than three (3) nominees or for any combination (up to three (3) total) of the Hartman Group Nominees and the Company’s nominees on the BLUE universal proxy card. Stockholders should refer to the Company’s proxy statement for the names, backgrounds, qualifications, and other information concerning the Company’s nominees.

Your vote to elect our nominees will have the legal effect of changing control of the Company at the Board level if all three (3) of our nominees are elected. We would then constitute a new majority of the Board. The Company’s stockholders will benefit from a new Board majority. Fundamentally, we believe in good corporate governance, and as a result, we believe directors of public companies should be elected at regular meetings of stockholders. Because the Executive Committee’s attempt to elect directors by written consent of stockholders failed, the current members of the Board are all holdovers, and only one of the three members of the Executive Committee was elected by stockholders, in December 2011. The other two, including Mr. Haddock, were appointed to the Board nearly five years ago, and have never been elected by the Company’s stockholders.

If our nominees are elected, we expect that Mr. Hartman will return as CEO and work with the two independent directors we have nominated, Mr. Longnecker and Mr. Thomas, to put in place a new management team committed to maximizing value for stockholders.

If you have already voted for the incumbent management slate on the Company’s universal proxy card, you can change your vote by signing, dating, marking your vote, and returning a later dated BLUE universal proxy card or by voting at the Annual Meeting. Any earlier voted proxies will then be disregarded.

If you have any questions or require any assistance with your vote, please contact InvestorCom, which is assisting us, at its address, toll-free number, or e-mail address listed below.

Thank you for your support,

/s/ Allen R. Hartman
Allen R. Hartman

Source:

https://www.sec.gov/Archives/edgar/data/831616/000110465925055983/tm2516991d1_defc14a.htm