<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): February 15, 1998
REAL ESTATE ASSOCIATES LIMITED II
- --------------------------------------------------------------------------------
(Exact name of Registrant as specified in charter)
CALIFORNIA 2-66171 95-3547609
- ---------------- ------------ --------------
(State or other (Commission (IRS Employer
jurisdiction File Number) Identification
incorporation) Number)
9090 Wilshire Boulevard
Suite 201
Beverly Hills, California 90211
- --------------------------------------------------------------------------------
Address of Principal Executive Offices
Registrant's telephone number, including area code: 310/278-2191
Page 1 of 3
<PAGE> 2
ITEM 5. OTHER EVENTS.
The Registrant recently became aware through several of its
limited partners that an entity identified as Bond Purchase, L.L.C. was
apparently conducting a tender offer for units in the Registrant pursuant to an
"Offer to Purchase Limited Partnership Interests for $215.00" dated February 15,
1998. Registrant has no further information about this "Offer to Purchase" or
Bond Purchase, L.L.C. By letter dated March 11, 1998, the Registrant's general
partners, on behalf of the Registrant, advised the limited partners to consult
with their tax advisors about the tax consequences that could result from a sale
of their units. Copies of the "Offer to Purchase" and the Registrant's letter
are attached hereto as exhibits.
EXHIBITS
The following exhibits are attached to this Current Report and thereby
made a part thereof:
1. Copy of the "Offer to Purchase" documents as received from
Registrant's limited partners.
2. Copy of Registrant's letter to its limited partners, dated March 11,
1998.
Page 2 of 3
<PAGE> 3
SIGNATURES
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 hereunto duly authorized.
DATED: July 13, 1998
REAL ESTATE ASSOCIATES LIMITED II,
A CALIFORNIA LIMITED PARTNERSHIP
BY: NATIONAL PARTNERSHIP INVESTMENTS CORP.,
A CALIFORNIA CORPORATION,
ITS GENERAL PARTNER
BY: /s/ Bruce E. Nelson
--------------------------------
ITS: President
---------------------------
Page 3 of 3
<PAGE> 4
REAL ESTATE
ASSOCIATES
LIMITED II
9090 Wilshire Boulevard o Suite 201 o Beverly Hills, California 90211
(310)278-2191
March 11, 1998
RE: REAL ESTATE ASSOCIATES LIMITED II
Dear Investor:
Several limited partners have called or written us to tell us that they
have received an unsolicited tender offer to buy their interests in Real Estate
Associates Limited II ("REAL II"). The buyers, Bond Purchase LLC, state that
they are purchasing the Units for investment purposes only.
The General Partners are unable to value the interests because of a lack of
a market for them, and therefore cannot comment on the fairness of Bond Purchase
LLC's offer. Limited Partners should also be aware that a sale of their
interests in REAL II will have tax consequences that should be evaluated in
consultation with each Limited Partner's own tax advisor.
In addition, the General Partners of REAL II expect to solicit the consent
of the Limited Partners to a proposed transaction pursuant to which several of
the properties in which REAL II has invested would be sold to a real estate
investment trust (the "REIT") to be organized by affiliates of the General
Partners of REAL II. Proxy materials have not yet been filed with the Securities
and Exchange Commission and solicitation of consents is not expected to commence
until the second quarter of 1998. If the REIT transaction is consummated,
limited partners would receive distributions of net sales proceeds according to
their interests in the Partnership. It should be noted that the REIT transaction
will be subject to a number of conditions in addition to approval by limited
partners of REAL II, including completion of a proposed private placement of
shares of the REIT. Accordingly, there can be no assurance that the proposed
purchases by the REIT of the REAL II will be consummated or that, if
consummated, would be on the currently proposed terms.
Most of the limited partners have negative capital account balances with
respect to their interests in REAL II. Our accountants tell us that on average,
the negative capital account balance for a $5,000 unit at the end of December
1997 was approximately $7,300. This means that an investor would recognize gain
from the sale of his REAL II interests in an amount equal to approximately
$7,515 (the $7,300 negative capital account balance plus the $215 sales price).
This gain would be "passive" and would be offset by passive losses which such
investor may have from REAL II (suspended from prior years) or other sources.
Unless a limited partner has suspended or current losses from other sources, a
substantial portion of the gain would still be subject to tax liability.
PLEASE CONSULT WITH YOUR TAX ADVISOR ABOUT THE IMPACT OF SUCH A SALE ON
YOUR OWN PARTICULAR SITUATION.
[LOGO]
CORPORATE GENERAL PARTNER: National Partnership Investments Corp.
<PAGE> 5
Page 2
REAL II
THE GENERAL PARTNERS URGE EACH INVESTOR TO CAREFULLY CONSIDER THE FOREGOING
INFORMATION BEFORE TENDERING HIS OR HER UNITS TO BOND PURCHASE LLC. ALTHOUGH THE
OFFER LETTER STATES THAT INVESTORS CANNOT WITHDRAW UNITS WHICH MAY ALREADY HAVE
BEEN TENDERED, YOU SHOULD CONSULT WITH YOUR ATTORNEY TO DETERMINE IF THIS
REQUIREMENT IS ENFORCEABLE SHOULD YOU WISH TO RECONSIDER YOUR DECISION TO
TENDER.
Sincerely,
National Partnership Investments Corp.
/s/ CHARLES H. BOXENBAUM /s/ BRUCE E. NELSON
Charles H. Boxenbaum Bruce E. Nelson
Chairman of the Board President
<PAGE> 6
BOND PURCHASE L.L.C.
P.O. Box 26730
Kansas City, MO 64196
February 15, 1998
To the Holders of Limited Partnership Interests in Real Estate
Associates Limited II.
RE: OFFER TO PURCHASE LIMITED PARTNERSHIP INTERESTS FOR $215.00
Dear Investor:
We are offering you an opportunity to sell your limited partnership
interests (the "Units") in Real Estate Associates Limited II (the "Partnership")
for cash in the amount of $215.00 per Unit (which amount will be reduced by any
cash distributions declared by the Partnership after the date of this letter).
Our offer provides you with an opportunity to sell your Units now without the
costly transfer fees and commission costs (typically up to 10%) usually paid by
the seller in secondary market sales. ALL TRANSFER COSTS AND FEES WILL BE PAID
BY BOND PURCHASE, L.L.C.
We believe that it is appropriate for investors to have financial choices.
Our offer gives you, the investor, the ability to make a decision about your
continued involvement with the Partnership. You may no longer wish to continue
with your investment in the Partnership for a number of reasons, including:
* NO FURTHER IRS FILING
* HIGHEST OFFER - This offer is higher than the last reported trade
of $210 (August 1, 1997 to September 30, 1997) in the secondary
market.
* If you sell your units, 1998 will be the final year for which you
receive a K-I tax form from the partnership.
* You may be able to realize a tax loss that would reduce your taxes
for 1998.
* The Partnership was closed eighteen years ago in 1980. Your money
has been tied up for this long period with minimal return.
* More immediate use for the cash tied up in your investment in the
Units.
* The absence of a formal trading market for the Units and their
resulting relative illiquidity.
<PAGE> 7
* The lack of any current cash distributions.
* General disenchantment with real estate investments, particularly
long-term investments in limited partnerships;
Our offer is limited to 512 of the 10,693 outstanding Units. If we were to
acquire more than this amount, the administrative costs of our offer would
become burdensome.
We will accept for purchase properly documented Units on a "first-received,
first-buy" basis. You will be paid promptly following confirmation of a valid,
properly executed Agreement of Transfer and other required transfer documents.
We will pay for all Partnership transfer fees and costs. All tenders of Units
will be irrevocable and may not be rescinded or withdrawn.
We are real estate investors who are not affiliated with the Partnership or
the General Partners. The General Partners of the Partnership have not analyzed,
approved, endorsed or made any recommendation as to acceptance of the offer. The
purchase offer has been determined solely at the discretion of Bond Purchase,
L.L.C. and does not necessarily represent the true market value of each unit. We
are seeking to acquire Units for investment purposes only and not with a view to
their resale.
An Agreement of Transfer is enclosed which you can use to accept our offer.
Please execute page 3 of this document, as well as the Power of Attorney, obtain
all other required signatures and return it in the enclosed envelope. In
addition, please return your Unit Certificate in the enclosed envelope. We
encourage you to act immediately if you are interested in accepting or offer as
only 512 Units will be purchased.
OUR OFFER WILL EXPIRE AT 5:00 PM ON APRIL 15, 1998, UNLESS EXTENDED.
Please call William Teel at (816) 421-4670 if you have any questions.
Sincerely,
Bond Purchase, L.L.C.
<PAGE> 8
AGREEMENT OF TRANSFER
FOR LIMITED PARTNERSHIP INTERESTS IN
REAL ESTATE ASSOCIATES LIMITED II
Subject to and effective upon acceptance for payment, the undersigned (the
"Seller") hereby sells, assigns, transfers, conveys and delivers and irrevocably
directs any custodian or trustee to sell, assign, transfer, convey and deliver
(the "Transfer") to Bond Purchase, LLC or it's assigns, a Missouri limited
liability company (the "Purchaser"), all of the Seller's right, title and
interest in Partnership Units (the "Units") of Real Estate Associates Limited
II, (the "Partnership"), for $195.00 per Unit, net to the Seller in cash, which
amount shall be reduced by any distributions declared by the Partnership after
February 15,1998.
Such Transfer shall include, without limitation, all rights in, and claims
to, any Partnership profits and losses, cash distributions, voting rights and
other benefits of any nature whatsoever distributable or allocable to such Units
under the Partnership's Certificate and Agreement of Limited Partnership, as
amended (the "Partnership Agreement"). The Seller hereby irrevocably constitutes
and appoints the Purchaser as the true and lawful agent and attorney-in-fact of
the Seller with respect to such Units, with full power of substitution (such
power of attorney being deemed to be an irrevocable power coupled with an
interest), to vote, inspect Partnership books and records or act in such manner
as any such attorney-in-fact shall, in its sole discretion, deem proper with
respect to such Units, to deliver such Units and transfer ownership of such
Units on the Partnership's books maintained by the General Partner of the
Partnership, together with all accompanying evidences of transfer and
authenticity to, or upon the order of, the Purchaser of the purchase price, to
receive all benefits and cash distributions, endorse Partnership checks payable
to Seller and otherwise exercise all rights of beneficial ownership of such
Units. The Purchaser shall not be required to post bond of any nature in
connection with this power of attorney.
The Seller hereby represents and warrants to the Purchaser that the Seller
owns such Units and has full power and authority to validly sell, assign,
transfer, convey and deliver such Units to the Purchaser, and that when any such
Units are accepted for payment by the Purchaser, the Purchaser will acquire
good, marketable and unencumbered title thereto, free and clear of all options,
liens, restrictions, charges, encumbrances, conditional sales agreements or
other obligations relating to the sale or transfer thereof, and such Units will
not be subject to any adverse claim. The Seller further represents and warrants
that the Seller is a "United States person", as defined in Section 7701 (a)(30)
of the Internal Revenue Code of 1986, as amended, or if the Seller is not a
United States person, that the Seller does not own beneficially or of record
more than 5% of the outstanding Units.
<PAGE> 9
Agreement of Transfer
Page 2
All authority herein conferred or agreed to be conferred shall survive the
death or incapacity or liquidation of the Seller and any obligations of the
Seller shall be binding upon the heirs, personal representatives, successors and
assigns of the undersigned. This agreement is irrevocable and may not be
withdrawn or rescinded.
Upon request, the Seller will execute and deliver, and irrevocably directs
any custodian to execute and deliver, any additional documents deemed by the
Purchaser to be necessary or desirable to complete the assignment, transfer and
purchase of such Units.
The Seller releases and discharges the General Partners, any IRA or KEOGH
Custodian, and their respective officers, shareholders, directors, employees and
agents from all causes of action, claims, or demands the Seller has or may have
against them resulting from their reliance on this Agreement of Transfer or any
of the terms and conditions contained herein.
The Seller hereby certifies, under penalties of perjury, that (1) the
number shown below on this form and the Sellers Taxpayer Identification Number
is correct and (2) Seller is not subject to backup withholding either because
Seller has not been notified by the Internal Revenue Service (the "IRS") that
Seller is subject to backup withholding as a result of a failure to report all
interest on dividends. or the IRS has notified Seller that Seller is no longer
subject to backup withholding.
The Seller hereby also certifies, under penalties of perjury, that the
Seller, if an individual, is not a nonresident alien for purposes of U.S. income
taxation, and if not an individual, is not a foreign corporation, foreign
partnership, foreign trust, or foreign estate (as those terms are defined in the
Internal Revenue Code and Income Tax Regulations). The Seller understands that
this certification may be disclosed to the IRS by the Purchaser and that any
false statements contained herein could be punished by fine, imprisonment, or
both.
<PAGE> 10
Agreement of Transfer
Page 3
Date:_______ 1998
- -------------------------------------- --------------------------------------
(Specify Number of Units Tendered: (Signature of Owner)
Indicate "ALL" if Number Not
Available)
--------------------------------------
Place Medallion Guarantee Stamp Here
- -------------------------------------- --------------------------------------
(Your Telephone Number) (Signature of Co-Owner)
--------------------------------------
Place Medallion Guarantee Stamp Here
- --------------------------------------
(Your Social Security or Taxpayer ID BOND PURCHASE, LLC
Number) P.O. BOX 26730
KANSAS CITY, MO 64196
(816) 421-4670
FAX (816) 221-1829
______________________________________ BOND PURCHASE, LLC
(Name of IRA Custodian, if applicable)
BY: __________________________________
Its Authorized Representative
NOTE: All signatures an this agreement must be guaranteed by a member from
a registered national securities exchange, a member of the National Association
of Securities Dealers, Inc. or a commercial bank, savings bank, credit union,
savings and loan association or trust company having an office, branch or agency
in the United States, which is a participant in the Security Transfer Agent
Medallion Program.
<PAGE> 11
POWER OF ATTORNEY/PROXY
In conjunction with the Assignor's (seller's) Assignment of Partnership Units
dated as of even date herewith, Seller irrevocably constitutes and appoints
David L. Johnson and William Teel, or any of them, to be Seller's true and
lawful special attorneys-in-fact, with full power of substitution to exercise in
the name, place and stead of Seller any and all rights, interests, powers, and
duties with respect to or arising out of the Seller's interest in:
REAL ESTATE ASSOCIATES LIMITED II
which Units have been assigned to Bond Purchase. L.L.C. (the "Buyer") pursuant
to the Agreement of Transfer. This Power of Attorney shall include with
limitation, (1) the right to execute on behalf of Seller, all assignments,
certificates, documents and instruments that may be required for the purpose of
transferring the Units owned by the Seller, (2) the right to vote the Units or
to require or receive an information or report with respect to the partnerships'
books and records, (3) the right to endorse and cash any check made payable by
the partnership to Seller on or after the date hereof and (4) the right, if the
Units are held in an IRA account or pension account, to contact the Seller's
custodian and direct him to facilitate in the transfer of the Units from the
Seller to Buyer Fund. This Power of Attorney is part of and hereby incorporated
in the application for transfer. This Power of Attorney shall not be affected by
the subsequent mental disability of the undersigned. as principal is irrevocable
and coupled with an interest, and Buyer shall not be required to post bond in
any nature in connection with this Power of Attorney. This Power of Attorney
shall also serve as a Letter of Authorization directing the Assignor's
custodian(s) and trustee(s) to sign any documents necessary to facilitate the
transfer of the units being assigned in conjunction with this Power of Attorney
as required by the herein named attorneys-in-fact.
- -------------------------------------- --------------------------------------
PRINT Assignor (Registered Name) PRINT Joint Assignor or
Custodian/Trustee
- -------------------------------------- --------------------------------------
SIGNATURE of Assignor SIGNATURE Joint Assignor or
Custodian/Trustee
DATE ______________,199__ DATE _____________,199__
Signature Guarantee Signature Guarantee
- -------------------------------------- --------------------------------------
