Berg Believes Stratus Statement About CEO Armstrong Stock Sales Contrary To The Facts

CUPERTINO, Calif., May 27, 2016

On Page 16 of Stratus's May 2016 investor presentation, the company claims that its Chairman and Chief Executive Officer "has never sold Stratus stock in his over 20 years with the company."

I would like to call to the attention of Stratus shareholders that on March 15, 2016, within a day after William H. Armstrong III, Chairman and Chief Executive Officer of Stratus Properties, trumpeted a jump in the company's estimated NAV per share of approximately 25% in the past 11 months to $44.34, he took the opportunity to transfer stock back to the company priced at $22.98 to pay taxes on recently vested stock grants. It is notable that Mr. Armstrong was willing to redeem his shares at 52% of the company's own published NAV estimate published a day earlier.

https://www.sec.gov/Archives/edgar/data/885508/000124636016005158/xslF345X03/form.xml

Though the shares of Stratus Properties have been relatively thinly traded according to NASDAQ for the last 15 years, the liquidity to sell or transfer shares back to the company to pay taxes or exercise stock options has been available to Mr. Armstrong, regardless of the prevailing trading volume in Stratus' shares.

According to Yahoo Finance, the trading volume in Stratus, which has been elevated since the filing of my Schedule 13D on December 21, 2015, was 31,800 shares on March 14, 2016. Mr. Armstrong's sale/redemption equated to roughly a third of the day's volume and he was able to achieve more per share than the previous night's closing price.

All but roughly 5% of the approximate 500,000 shares that Mr. Armstrong owns have come via stock grants or cashless exercise options over the years. Since 2005 Mr. Armstrong has sold or transferred to the company over 330,000 shares of stock receiving an average price of over $28 per share, a total of over $9 million.