Delaware Court Gives Go Ahead for Steel Partners’ Revised Restructuring Plan

Business Wire, June 19, 2009

Steel Partners to Proceed With Distribution of Cash and Securities on July 15, 2009, Aims to List Steel Partners Holdings Tradable Units by Year End

NEW YORK -- Steel Partners announced today that the Court of Chancery of the State of Delaware has denied preliminary injunctions requested by a minority group of investors (the “Plaintiffs”) seeking to block the Steel Partners II Revised Restructuring Plan (“Revised Plan”) and the lifting of the temporary suspension of redemptions from the Fund.

“We are gratified that the Delaware Court has recognized that the Plaintiffs, who are a distinct minority of the Fund, have no legal grounds under which to further delay implementation of the Revised Plan or to force an undefined liquidation of the Fund on the majority of the investors,” stated Warren Lichtenstein of Steel Partners. “Since we initiated the restructuring process at the end of 2008, our overriding objective has been to treat all our investors fairly and equitably. The Revised Plan achieves that goal, offering investors a choice between continuing to invest with Steel Partners or redeeming their investment. Throughout this unfortunate litigation we sought to protect the ability of our investors to choose how to deploy their capital against the Plaintiffs who are against investor choice and who sought to unilaterally rewrite the Fund agreements.”

Following the Court’s decision, Steel Partners on July 15, 2009, as previously announced, will lift the temporary suspension of redemptions from the Fund and implement the Revised Plan.

Investors who elected Option A of the Revised Plan will receive Common Units of Steel Partners Holdings L.P. (formerly WebFinancial L.P.)(“SPH”), a Delaware limited partnership, and an initial cash distribution followed by quarterly distributions for up to two years. Steel Partners said it will seek a listing of the SPH Common Units on a major stock exchange by the end of this year.

Investors who elected Option B of the Revised Plan, or did not make an election, will receive a pro rata distribution-in-kind of the portfolio securities of Steel Partners II and a cash distribution.

“For those investors who remain interested in our long-term value active strategy, SPH provides a way for us to continue to manage the existing portfolio and to take advantage of future investment opportunities,” Mr. Lichtenstein said. “For those investors who have elected to redeem from the Fund, we thank them for their support over the years.”

About Steel Partners

Steel Partners is a global long-term relationship/active value investor that seeks to work with the management of its portfolio companies to increase corporate value for all stakeholders and shareholders.