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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT PURSUANT
TO SECTION 14(d)(4) OF THE SECURITIES EXCHANGE ACT OF 1934
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UNIVERSITY REAL ESTATE PARTNERSHIP V
(Name of Subject Company)
UNIVERSITY REAL ESTATE PARTNERSHIP V
(Name of Person(s) Filing Statement)
INCOME UNITS OF LIMITED PARTNERSHIP INTEREST
(Title of Class of Securities)
NONE
(CUSIP Number of Class of Securities)
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CURTIS R. BOISFONTAINE, JR. .
UNIVERSITY ADVISORY COMPANY
2001 ROSS AVENUE, SUITE 4600
DALLAS, TEXAS 75201
(214) 740-2200
(Name, Address and Telephone Number of
Person Authorized to Receive Notices and
Communications on Behalf of Bidder)
with copy to:
SALLY SCHREIBER, ESQ.
MUNSCH HARDT KOPF HARR & DINAN, P.C.
4000 FOUNTAIN PLACE
1445 ROSS AVENUE
DALLAS, TEXAS 75202-2790
(214) 855-7598
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ITEM 1. SECURITY AND SUBJECT COMPANY
This Schedule relates to Income Units of limited partnership interest
(the "UNITS") in University Real Estate Partnership V, a California limited
partnership (the "ISSUER"), which is the subject company. The address of the
Issuer's principal executive offices is 2001 Ross Avenue, Suite 4600, Dallas,
Texas 75201.
ITEM 2. TENDER OFFER OF THE BIDDER
This statement relates to the following tender offers:
(1) The offer by Accelerated Yield Institutional Fund 1, L.P., MacKenzie
Patterson Special Fund, Peachtree Partners and Accelerated High Yield
Pension Investors, L.P. (collectively the "MACKENZIE BIDDERS"), to
purchase up to 15,270 Units for cash at $45 per Unit less the amount of
any distributions made or declared with respect to the Units between
December 2, 1997 and December 31, 1997. Such offer has recently been
supplemented to increase the cash purchase price to $55 per Unit less
similar reductions for distributions. The address of the principal
executive offices of the MacKenzie Bidders is 1640 School Street, Suite
100, Moraga, CA 94556.
(2) The offer by Everest Properties II, LLC (the "EVEREST BIDDER") to
purchase up to 568 Units for cash at $55 per Unit, less any cash
distributions made to security holders by the Issuer after November 30,
1997 and any transfer fees charged by the Issuer. The address of the
principal executive offices of the Everest Bidder is 199 S. Los Robles
Ave., Suite 440, Pasadena, California, 91101.
(3) The offer by Bond Purchase, L.L.C. (the "BOND BIDDER") to purchase
up to 1,710 Units for cash at $57 per Unit, less any cash distributions
declared to security holders by the Issuer after December 15, 1997. The
address of the principal executive offices of the Bond Bidder is listed
as P.O. Box 26730, Kansas City, MO 64196.
The MacKenzie Bidders, the Everest Bidder and the Bond Bidder shall
collectively be known as the "Bidders" and their respective offers to purchase
Units shall collectively be known to as the "OFFERS."
ITEM 3. IDENTITY AND BACKGROUND
(a) This Statement is being filed by the Issuer, acting through
University Advisory Company ("UAC"), which is the General Partner of the Issuer.
The address of the principal executive offices of the Issuer is 2001 Ross
Avenue, Suite 4600, Dallas, Texas 75201.
(b) Except as provided below, to the best knowledge of UAC, there are no
material contracts, agreements, arrangements, understandings, or actual or
potential conflicts of interest between the Issuer and: (1) its executive
officers, directors or affiliates including UAC; or (2) the Bidders, their
executive officers, directors, or affiliates.
A certain Limited Partnership Agreement dated August 12, 1977, was
entered into by and between UAC and certain other parties set forth on Exhibit A
thereto (the "AGREEMENT"). The Agreement was entered into for the purpose of
investing in and operating a diversified portfolio of professionally managed
real properties. The Agreement sets forth, among other things, UAC's duties,
obligations and powers as general partner of the Issuer, as well as the ability
of the limited partners of the Issuer to remove UAC, as general partner. The
Agreement describes, at Section 6, the terms of compensation payable to UAC for
various functions including (i) a property management fee of up to 5% of the
gross rents from tenants at and from other income from the Issuer's real
properties, (ii) a general partner's interest fee including a fee of 8% of
distributions from Operational Cash Flow, a fee of 1% of distributions by the
Issuer from certain other sources, and up to an additional 11% of certain
distributions from other sources made after payments made to the limited
partners of the Issuer, (iii) an investment advisory fee of 9% of the gross
proceeds on the sale of limited partnership units, (iv) an acquisition fee of 9%
of the proceeds of certain limited partnership units of the Issuer sold in
connection with the acquisition by the Issuer of real property, and (v) a
subordinated real estate commission of up to 9% of the gross proceeds from the
sale of limited partnership units allocate to certain real properties sold by
the Issuer.
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ITEM 4. THE SOLICITATION OR RECOMMENDATION
The Issuer does not believe that any of the Offers are in the best
interests of the Issuer or Issuer's security holders and that the security
holders should therefore reject such Offers. UAC has determined that the
Offers are not in the best interest of the security holders for the following
reasons:
(1) The price per Unit offered in the Offers does not adequately
reflect the values inherent in the Units. Because the Units are
not traded on an exchange nor is there any active trading market
for the Units, they are essentially illiquid. Therefore, the
Issuer believes that any trading prices that do exist do not
reflect the values inherent in the Units. The price per Unit
offered by the Bidders is even lower than the estimated
liquidation value per Unit of $59.72, estimated by the MacKenzie
Bidders in their tender offer materials.
(2) A significant portion of the purchase price could go to pay
taxes. Although each security holder's tax situation is
different and neither UAC nor the Issuer has prepared an
analysis of the tax ramifications of the tender offers made by
the Bidders, it is likely that most security holders of the
Issuer will pay income tax on an amount of income substantially
greater than the actual cash to be received from any of the
Bidders. The Issuer strongly recommends that each security
holder of the Issuer consult his/her tax advisor on the tax
ramifications of this tender offer and the effect of any
negative capital accounts.
(3) UAC and other parties are contemplating tender offers for the
Units at a higher price than the tender offers submitted by any
of the Bidders. UAC has been engaged in discussions and
negotiations with other parties which are considering joining
with UAC or its affiliates in making a tender offer for the
Units of the Issuer at a price per Unit in excess of the prices
offered by any of the Bidders. THERE CAN BE NO ASSURANCE THAT
ANY SUCH OFFER WILL BE COMMENCED, IF COMMENCED, THE PRECISE
TERMS OF THE OFFER, INCLUDING THE PRICE OR NUMBER OF UNITS
SOUGHT, OR WHETHER THE OFFER WILL BE CONSUMMATED.
(4) Although the MacKenzie Bidders' Offer does not fully disclose
their intentions to seek control of the Issuer, it is UAC's
belief that it is the MacKenzie Bidders' intention to gain
control of the Issuer by acquiring Units. If the MacKenzie
Bidders' Offer is successful, they could be in a position to
influence voting decisions with respect to the Issuer and
thereby control the Issuer's operations directly by removal of
the general partner, or indirectly through a controlling vote on
Issuer matters, including amendments to the Issuer's partnership
agreement. The MacKenzie Bidders' Offer does not disclose
whether they or one of their affiliates has expertise in the
management of partnerships similar to the Issuer. Furthermore,
the MacKenzie Bidders have not provided any information
regarding its plans in the event that it acquires control of the
business of the Issuer. As a result, the Issuer cannot fully
evaluate the MacKenzie Bidders' performance record, expertise or
intentions.
ITEM 5. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED
The Issuer has not retained, employed or compensated any person to make
solicitations or recommendations to security holders with respect to the Offers
described in this statement.
ITEM 6. RECENT TRANSACTIONS AND INTENT WITH RESPECT TO SECURITIES
(a) To the best knowledge of UAC, no transactions in the Units have
been effected during the past 60 days by the Issuer, by UAC or by any executive
officer, director, affiliate or subsidiary of the Issuer or UAC.
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(b) To the best knowledge of UAC, neither the Issuer nor UAC nor any
of their respective executive officers, directors, affiliates or subsidiaries
presently intends to tender to any of the Bidders any Units which are held of
record or beneficially owned by such persons.
ITEM 7. CERTAIN NEGOTIATIONS AND TRANSACTIONS BY THE SUBJECT COMPANY
(a) Except for the possible tender offer to be made by UAC as
described in Item 4 above, to the best knowledge of UAC, the Issuer has not
entered into negotiations in response to any of the Offers that would result in
an extraordinary transaction, a purchase, sale or transfer of a material amount
of assets of the Issuer, a tender offer for or other acquisitions of securities
by or of the Issuer, or any material change in the present capitalization or
dividend policy of the Issuer.
(b) To the best knowledge of UAC, there are no transactions, board
resolutions, agreements in principle or signed contracts in response to the
Offers that relate to or would result in one or more of the matters referred to
above in Item 7(a).
ITEM 8. ADDITIONAL INFORMATION TO BE FURNISHED
(a) None.
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS
(a) Recommendation letter by the Issuer to security holders dated
December 16, 1997.
(b) None.
(c) The Limited Partnership Agreement is incorporated by reference
to Form 10 of the Registration Statement filed by the Issuer on
January 6, 1978.
SIGNATURE
After reasonable inquiry and to the best of the undersigned's knowledge
and belief, the undersigned certifies that the information set forth in this
statement is true, complete, and correct.
UNIVERSITY REAL ESTATE PARTNERSHIP V
By: UNIVERSITY ADVISORY COMPANY, its general partner
By: OS General Partner Company,
its general partner
12-16-97 By: /s/ David K. Ronck
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(Date) David K. Ronck, Vice President
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EXHIBIT 9(a)
UNIVERSITY ADVISORY COMPANY
2001 Ross Avenue, Suite 4600
Dallas, Texas 75201
December 16, 1997
TO: THE LIMITED PARTNERS OF
UNIVERSITY REAL ESTATE PARTNERSHIP V
To Our Partners:
On December 3, 1997, University Advisory Company ("UAC") received notice that
Accelerated High Yield Institutional Fund 1, L.P., MacKenzie Patterson Special
Fund, Peachtree Partner and Accelerated High Yield Pension Investors, L.P. (the
"Bidders") were commencing a tender offer for 15,270 income units (the "Units")
of University Real Estate Partnership V, Ltd. (the "Partnership") at a price of
$45.00 per Income Unit (the "MP Offer"). You should be aware that the MP Offer
was not solicited by the Partnership and that the Partnership's management was
not aware of the terms of the MP Offer until the offer had commenced.
In addition to the MP Offer, it is our understanding that Income Unitholders
have received, or will receive, offers for under five percent (5%) of the
outstanding Income Units from Everest Properties II, LLC ("Everest") for $55 per
Income Unit (the "Everest Offer") and also from Bond Purchase, LLC ("Bond") for
$57 per Income Unit (the "Bond Offer"). In response to the Everest Offer,
MacKenzie Patterson has increased its offer to $55 per Income Unit.
The attached Schedule 14D-9, which is being filed today with the Securities and
Exchange Commission (the "14D-9 Filing") discusses in greater detail the
recommendations and responses of the Partnership with respect to the MP Offer as
well as the Everest Offer and the Bond Offer, collectively referred to as the
Offers. We believe that the 14D-9 Filing contains very important information
which you should consider before you reach a decision with respect to the
Offers.
Since December 3, 1997, when the MP Offer was made public, the Partnership's
management and its advisors have conducted a review of the terms of the MP Offer
and, subsequently the Everest Offer and the Bond Offer and have also explored
various possible alternatives which might be (or become) available to the
Partnership and/or the Limited Partners. As a result of these examinations, the
Partnership has reached the conclusion that NONE OF THE OFFERS IS IN THE BEST
INTERESTS OF EITHER THE PARTNERSHIP OR THE LIMITED PARTNERS, AND THE PARTNERSHIP
STRONGLY RECOMMENDS THAT THE OFFERS SHOULD BE REJECTED. Some of the factors
which caused the Partnership to reach these conclusions are summarized below and
were considered along with other factors in reaching the recommendation, all of
which are discussed in more detail in Item 4 of the 14D-9 Filing.
The decision whether to accept the MP Offer, the Everest Offer or the Bond Offer
is solely at the discretion of each investor. YOU NEED TAKE NO ACTION
WHATSOEVER IF YOU DO NOT WISH TO ACCEPT ANY OF THE OFFERS. YOU SHOULD KNOW THAT
UAC AND OTHERS ARE CONTEMPLATING TENDER OFFERS FOR UNITS AT A HIGHER PRICE THAN
THE OFFERS ALTHOUGH THERE IS NO ASSURANCE THAT ANY SUCH OFFER WILL BE MADE.
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With respect to the determination by the Partnership that the Offers are NOT in
the best interest of the Limited Partners, the Partnership and its advisors
considered, among other reasons, the following:
. THE PRICE PER UNIT OFFERED IN THE OFFERS DO NOT ADEQUATELY REFLECT THE VALUES
INHERENT IN THE UNITS. No active trading market exists for the Units.
Because the Units are not traded on an exchange they are essentially illiquid.
The Partnership believes that such trading prices do not reflect the values
inherent in the Units. The price per Unit offered by MP is even lower than
the Estimated Liquidation Value per Unit estimated by MP.
. A SIGNIFICANT PORTION OF THE PURCHASE PRICE COULD GO TO PAY TAXES. Although
each limited partner's tax situation is different and the Partnership has not
prepared an analysis of the tax ramifications of the Offers, it is likely that
most partners will pay income tax on an amount of income substantially greater
than the actual cash to be received from the Offers. The Partnership strongly
recommends that each limited partner consult his/her tax advisor on the tax
ramifications of this tender offer and the effect of any negative capital
accounts.
. UNIVERSITY ADVISORY COMPANY AND OTHER PARTIES ARE CONTEMPLATING TENDER OFFERS
FOR THE UNITS AT A HIGHER PRICE THAN THE OFFERS. UAC has been engaged in
discussions and negotiations with other parties which are considering joining
with UAC or its affiliates in making a tender offer for the Units of the
Partnership at a price per Unit in excess of the prices offered by MP, Everest
and Bond. There can be no assurance that any such offer will be commenced or,
if commenced, the precise terms of the offer, including the price or number of
Units sought, or whether the offer will be consummated.
. MP'S INTENTIONS ARE TO TAKE CONTROL OF THE PARTNERSHIP. The MP Offer does not
fully disclose their intentions to seek control of the Partnership. It is the
Partnership's belief that it is MP's intention to gain control of the
Partnership by acquiring Units.
. MP'S SUITABILITY / INTENTIONS. If the MP Offer is successful, MP could be in
a position to influence voting decisions with respect to the Partnership and
thereby control Partnership operations directly by removal of the general
partner, or indirectly through a controlling vote on Partnership matters,
including any amendments to the Partnership Agreement. The MP Offer does not
disclose whether MP or one of its affiliates has expertise in the management
of partnerships similar to the Partnership. Furthermore, MP has not provided
any information regarding its plans in the event that it acquires control of
the business of the Partnership. As a result, the Partnership cannot fully
evaluate MP?s past performance record, expertise or intentions.
The decision whether to accept any of the Offers is an individual decision by
each limited partner. No action taken by MP, Everest or bond or any other
investor or group of investors will affect your current ownership of Units in
the Partnership, unless you elect to sell your interest in the Partnership. If
you have already accepted any of the Offers and wish to change your mind and
rescind your tender, you may do so in accordance with the materials furnished
with such offer. Alternatively, you may rescind your tender by written or
facsimile notification to the Depositary at Wallace Sanders & Company, 8131 LBJ
Freeway, Suite 875, Dallas, Texas 75251, Attention: University V Tender Offers
(or by facsimile at 972/669-3462), which notification, if sent sufficiently
before the expiration of the relevant Offer, will then be forwarded to the
appropriate person. The withdrawal notice must be signed by the person(s) who
signed the tender form in the same manner as the tender form was signed.
Tenders may be withdrawn in this manner at any time prior to the expiration date
of the relevant Offer (which is December 31, 1997 in the case of the MP offer).
We will stay in communication with you during this process and keep you
appraised of further developments both with respect to the MP Offer, the Everest
Offer, the Bond Offer and/or the possible tender offer from University Advisory
Company.
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In the meantime, the Partnership has enlisted the services of EquiNet Fund
Administrators, Inc. as an Information Agent to respond to your questions or
concerns regarding any of the Offers or the Partnership's response. A toll free
number (1-800-736-8036) will be answered by informed representatives 8:30 am to
5:00 pm, Monday through Friday.
Sincerely,
UNIVERSITY ADVISORY COMPANY
By: OS General Partner Company,
its General Partner
By: /s/ David K. Ronck
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David K. Ronck
Vice President
