<PAGE>
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
SCHEDULE 14D-1/A
Tender Offer Statement Pursuant To Section 14(d)(1) of
the Securities Exchange Act of 1934
(Amendment No. 2)
--------------------
BALCOR/COLONIAL STORAGE INCOME FUND - 86,
AN ILLINOIS LIMITED PARTNERSHIP
(Name of Subject Company)
PUBLIC STORAGE, INC.
(Bidder)
--------------------
Interests in Limited Partnership
(Title of Class of Securities)
--------------------
NONE
(CUSIP Number of Class of Securities)
--------------------
DAVID B.H. MARTIN, JR.
Hogan & Hartson L.L.P.
Columbia Square
555 Thirteenth Street, N.W.
Washington, D.C. 20004-1109
(202) 637-5600
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications on Behalf of Bidder)
--------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
-------------------------------------------------
Transaction Valuation * Amount of Filing Fee
-------------------------------------------------
<S> <C>
$26,000,000 $5,200
-------------------------------------------------
</TABLE>
* This Amended Tender Offer Statement on Schedule 14D-1/A is being filed in
connection with an amended Offer made by Public Storage, Inc. to acquire up to
100,000 of the outstanding Limited Partnership interests in Balcor/Colonial
Storage Income Fund - 86, an Illinois Limited Partnership. The total value of
the transaction was estimated solely for purposes of calculating the filing fee.
/x/ Check box if any part of the fee is offset as provided by Rule 0-
11(a)(2) and identify the filing with which the offsetting fee was
previously paid. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
Amount Previously Paid: $3,696; $1,504
Form or Registration No.: Schedule 14D-1; Schedule 14D-1/A,
Amendment No. 1
Filing Party: Public Storage, Inc.
Date Filed: April 15, 1996; May 7, 1996
<PAGE>
1) Name of Reporting Person: Public Storage, Inc.
S.S. or I.R.S. Identification No. of Above Person: 95-355121
2) Check the Appropriate Box if a Member of a Group (See Instructions)
/ / (a)
-----------------------------------------------------------
/ / (b)
-----------------------------------------------------------
3) SEC Use Only
-------------------------------------------------------
4) Sources of Funds (See Instructions): WC
5) / / Check Box if Disclosure of Legal Proceedings is Required Pursuant
to Items 2(e) or 2(f).
6) Citizenship or Place of Organization: California
7) Aggregate Amount Beneficially Owned by Each Reporting Person:
20,141.678 Limited Partnership interests.
8) / / Check if the Aggregate Amount in Row 7 Excludes Certain Shares
(See Instructions).
9) Percent of Class Represented by Amount in Row 7: 7.8%
10) Type of Reporting Person (See Instructions): CO
-2-
<PAGE>
The Statement on Schedule 14D-1 dated April 15, 1996 (the "Schedule
14D-1") as amended by the Statement on Schedule 14D-1/A, Amendment No. 1 dated
May 7, 1996 ("Amendment No. 1") relating to the Company's offer to purchase
limited partnership interests in Balcor/Colonial Storage Income Fund - 86 (the
"Partnership") is amended by this Amendment No. 2 as set forth below.
Capitalized terms that are not defined herein have the meanings assigned to
those terms in the Schedule 14D-1.
Item 6. Interest in Securities of the Subject Company.
----------------------------------------------
(b) The Company has purchased 10,814 Interests from Everest Storage
Investors, LLC for $240 per Interest pursuant to the Everest
Agreement. The Company expects to purchase an additional 160
Interests pursuant to the Everest Agreement in the near future.
Item 10. Additional Information.
-----------------------
(f) The Letter to Interest Holders dated May 17, 1996 attached hereto
as Exhibit (a) is incorporated herein by reference in its entirety.
Item 11. Material to be filed as Exhibits.
---------------------------------
See Exhibit Index contained herein.
-3-
<PAGE>
SIGNATURE
---------
After reasonable inquiry and to the best of its knowledge and belief,
the undersigned certifies that the information set forth in this statement is
true, correct and complete.
Dated: May 20, 1996 PUBLIC STORAGE, INC.
By: /s/ Harvey Lenkin
---------------------------------
Harvey Lenkin
President
-4-
<PAGE>
Exhibit Index
-------------
Exhibit No.
(1) Letter to Interest Holders dated May 17, 1996.
(b) Not applicable.
(c) Not applicable.
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
-5-
<PAGE>
[PUBLIC STORAGE, INC. LETTERHEAD]
May 17, 1996
Re: Tender Offer for Interests in Balcor/Colonial Storage
Income Fund 86 and Solicitation of Votes
Dear Interest Holder:
On May 8, 1996, we advised you to vote AGAINST the sale of our
Partnership's properties to Storage Trust Properties, L.P. because the sale does
not maximize the return on our investment. We believe our view is supported by
subsequent developments. The General Partners have reported that U-Haul made an
offer to purchase the properties for $69 million (about $2 million more than the
proposed sale to Storage Trust). U-Haul's offer has apparently been withdrawn
after discussions with Storage Trust, but we believe it still supports our view
that the properties should not be sold to Storage Trust for $67.1 million.
---
We believe that limited partners who desire liquidity have a better
alternative under our Offer to purchase your Interests (subject to proration) at
$260 per Interest than under the proposed sale with its lower liquidating
distribution. Based on the number of Interests that have been tendered to date,
we do not believe our Offer will be over-subscribed. We are seeking 100,000
Interests and to date only 14,083 Interests have been tendered.
We are extending the period of time for which the Offer is open until 5:00
p.m., New York City time, on May 24, 1996.
Our obligation to purchase validly tendered Interests is conditioned on the
holders of at least 75% of the Interests tendered voting "Abstain" or "Against"
the proposed sale of the properties.
IF YOU WISH TO SELL YOUR INTERESTS FOR $260 EACH, PLEASE COMPLETE THE
ENCLOSED LETTER OF TRANSMITTAL, MARK THE FORM OF CONSENT "ABSTAIN" OR "AGAINST"
THE PROPOSED SALE OF THE PROPERTIES AND RETURN THE LETTER OF TRANSMITTAL TO THE
FIRST NATIONAL BANK OF BOSTON AS SOON AS POSSIBLE IN THE POSTAGE-PAID ENVELOPE
PROVIDED OR BY FACSIMILE AT (617) 575-2233.
IF YOU DO NOT WISH TO SELL YOUR INTERESTS AND HAVE ALREADY VOTED IN FAVOR
OF THE PROPOSED SALE OF THE PROPERTIES, WE URGE YOU TO RETURN THE ENCLOSED WHITE
NOTICE OF REVOCATION TO THE FIRST NATIONAL BANK OF BOSTON AS SOON AS POSSIBLE IN
THE ENVELOPE PROVIDED OR BY FACSIMILE AT (617) 575-2233.
We thank you for your consideration and prompt attention to this matter.
Very truly yours,
PUBLIC STORAGE, INC.
By: /s/ Harvey Lenkin
---------------------------------------
Harvey Lenkin
President
<PAGE>
NOTICE OF REVOCATION
The undersigned, a Limited Partner of the Partnership, hereby revokes
any previously executed Consents relating to the sale of the properties of
Balcor/Colonial Storage Income Fund - 86.
- ----------------------------------- --------------------------------
Registered owner name (please print) Signature
- ----------------------------------- --------------------------------
Registered owner name (continued) Date
- ----------------------------------- --------------------------------
Registered owner address Signature, if held jointly
- ----------------------------------- --------------------------------
Registered owner city, state, zip Date
- -----------------------------------
Signature of Custodian or Trustee
(Required for all Custodial Accounts)
When limited partnership interest(s) are held by joint tenants, both joint
tenants should sign. When signing as attorney, executor, administrator, trustee
or guardian, please give full title as such. When the limited partnership
interest(s) are held of record by tax-exempt Limited Partner, the signature of
the custodian or trustee is also required. If a corporation, please have signed
in full corporate name by the president or other authorized officer. If a
partnership, please have signed in partnership name by an authorized person.
<PAGE>
LETTER OF TRANSMITTAL (With Form of Consent)
To Purchase Limited Partnership Interests of Balcor/Colonial Storage Income
Fund - 86, an Illinois limited partnership
Pursuant to the Offer to Purchase dated April 15, 1996, as amended May 8, 1996
of Public Storage, Inc.
- --------------------------------------------------------------------------------
DESCRIPTION OF INTERESTS TENDERED
Name and Address of Registered Holder Number of Interests Tendered
- ------------------------------------- ----------------------------
---------------------------*
* Unless otherwise
indicated, it will be
assumed that all
Interests held by the
registered holder are
being tendered.
- --------------------------------------------------------------------------------
THIS OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON MAY 22, 1996, UNLESS
EXTENDED. INTERESTS TENDERED PURSUANT TO THIS OFFER MAY BE WITHDRAWN AT ANY
TIME PRIOR TO THE EXPIRATION OF THIS OFFER.
This Letter of Transmittal is to be executed and returned to The First National
Bank of Boston (the "Depositary") at one of the following addresses:
<TABLE>
<S> <C> <C> <C>
By Mail By Hand By Overnight Courier For Information
The First National Bank of BancBoston Trust The First National Bank of The First National Bank of
Boston Company of New York Boston Boston
Shareholder Services 55 Broadway Corporate Agency & Shareholder Services
P.O. Box 1872 3rd Floor Reorganization (617) 575-3120
Mail Stop 45-01-19 New York, NY 10006 150 Royall Street
Boston, MA 02105 Mail Stop 45-01-19
Canton, MA 02021
</TABLE>
Delivery of this instrument to an address other than as set forth above will not
constitute a valid delivery. The accompanying instructions should be read
carefully before this Letter of Transmittal is completed.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
Tender of Interests
-------------------
The undersigned hereby tenders to Public Storage, Inc., a California
corporation (the "Company"), the above-described limited partnership interests
(the "Interests") of Balcor/Colonial Storage Income Fund - 86, an Illinois
limited partnership (the "Partnership"), for $260 per Interest in cash in
accordance with the terms and subject to the conditions of the Company's Offer
to Purchase dated April 15, 1996, as amended May 8, 1996 (the "Offer to
Purchase"), and in this Letter of Transmittal (which together with the Offer to
Purchase and any supplements or amendments constitutes the "Offer"). The
undersigned hereby acknowledges receipt of the Offer to Purchase. Capitalized
terms used but not defined herein have the respective meanings assigned in the
Offer to Purchase.
Subject to, and effective upon, acceptance for payment of the
Interests tendered hereby in accordance with the terms and subject to the
conditions of the Offer, the undersigned hereby sells, assigns, transfers,
conveys and delivers to the Company, all right, title and interest in and to
such Interests tendered hereby and accepted for payment pursuant to the Offer
and any and all non-cash distributions, other Interests or other securities
issued or issuable in respect thereof on or after April 15, 1996 including,
without limitation, all rights in and claims to any Partnership profits and
losses, voting rights, rights to be substituted as a Limited Partner of the
Partnership and other benefits of any nature whatsoever distributable or
allocable to each such tendered Interest under the Partnership Agreement. The
undersigned hereby appoints the Depositary the true and lawful agent and
attorney-in-fact of the undersigned with respect to such Interests and (and any
and all non-cash distributions, other Interests or securities issued or issuable
in respect thereof on or after April 15, 1996), with full power of substitution
(such power of attorney being deemed to be an irrevocable power coupled with an
interest), to (a) transfer ownership of such Interests (and any such non-cash
distributions, other Interests or securities), to or upon the order of the
Company, (b) present such Interests (and any such non-cash distributions, other
Interests or securities) for transfer on the books of the Partnership and (c)
receive all benefits and otherwise exercise all rights of beneficial ownership
of such Interests (and any such non-cash distributions, other Interests or
securities), all in accordance with the terms of the Offer.
The undersigned hereby represents and warrants that the undersigned
(i) has received and reviewed the Offer to Purchase and (ii) has full power and
authority to sell, assign, transfer, convey and deliver the Interests tendered
hereby (and any and all non-cash distributions, other Interests or securities
issued or issuable in respect thereof on or after April 15, 1996) and that when
the same are accepted for payment by the Company, the Company will acquire good,
marketable and unencumbered title thereto, free and clear of all liens,
restrictions, charges and encumbrances, and the same will not be subject to any
adverse claim. The undersigned, upon request, will execute and deliver any
additional documents deemed by the Depositary or the Company to be necessary or
desirable to complete the sale, assignment, transfer, conveyance and delivery of
the Interests tendered hereby and any and all non-cash distributions, other
Interests or other securities issued or issuable in respect of such Interests on
or after April 15, 1996. In addition, the undersigned shall promptly remit and
transfer to the Depositary for the account of the Company any and all non-cash
<PAGE>
distributions, other Interests or other securities issued to the undersigned on
or after April 15, 1996 in respect of the Interests tendered hereby, accompanied
by appropriate documentation of transfer, and pending such remittance or
appropriate assurance thereof, the Company shall be entitled to all rights and
privileges as owner of any such non-cash distributions, other Interests or other
securities and may withhold the entire consideration or deduct from the
consideration the amount of value thereof as determined by the Company, in its
sole discretion.
The undersigned understands that under certain circumstances set forth
in the Offer, and subject to the applicable rules of the Securities and Exchange
Commission, the Company may not be required to accept for payment any of the
tendered Interests. In such event, the undersigned understands that any Letter
of Transmittal for Interests not accepted for payment will be destroyed by the
Company.
The undersigned understands that, if proration is required pursuant to
the terms of the Offer, the Company will accept for payment from among those
Interests validly tendered prior to or on the Expiration Date and not properly
withdrawn, the maximum number of Interests permitted pursuant to the Offer on a
pro rata basis, with adjustments to avoid purchases of prorated fractional
Interests.
The undersigned hereby irrevocably constitutes and appoints the
Company and any designee of the Company as the true and lawful attorney-in-fact
and proxy of the undersigned with respect to such Interests with full power of
substitution, to vote, in such manner as each such attorney and proxy or his
substitute shall, in his sole discretion, deem proper, and otherwise act
(including pursuant to written consent) with respect to all of the Interests
tendered hereby which have been accepted for payment by the Company prior to the
time of such vote or action (and any and all non-cash distributions, other
Interests or securities issued or issuable in respect thereof on or after April
15, 1996), which the undersigned is entitled to vote, at any meeting (whether
annual or special and whether or not an adjourned meeting) of Limited Partners
of the Partnership, or with respect to which the undersigned is empowered to act
in connection with action by written consent in lieu of any such meeting or
otherwise. This proxy and power of attorney is coupled with an interest in the
Interests tendered hereby, is irrevocable and is granted in consideration of,
and is effective upon, the acceptance for payment of such Interests by the
Company in accordance with the terms of the Offer. Such acceptance for payment
shall revoke any other proxy granted by the undersigned at any time with respect
to such Interests (and any such non-cash distributions, other Interests or
securities), other than the consent granted to the Company below, and other than
the irrevocable proxy granted to the General Partners pursuant to Article XXI of
the Partnership Agreement, and no subsequent proxies will be given (and if given
will be deemed not to be effective) with respect thereto by the undersigned.
The undersigned understands that tenders of Interests pursuant to the
procedures described in the Offer and in the instructions hereto will constitute
a binding agreement between the undersigned and the Company upon the terms and
subject to the conditions of the Offer. All authority herein conferred or
agreed to be conferred shall survive the death or incapacity of the undersigned
hereunder shall be binding upon the heirs, executors, administrators, legal and
personal representatives, successors and assigns of the undersigned. This
tender is irrevocable except as stated in the Offer, however, Interests tendered
pursuant to the Offer may be withdrawn at any time prior to the Expiration Date.
The undersigned hereby certifies, under penalties of perjury, that (1)
the number shown on this form below the undersigned's signature is my correct
Taxpayer Identification Number and (2) I am not subject to backup withholding
either (a) because I have not been notified by the Internal Revenue Service (the
"IRS") that I am subject to backup withholding as a result of a failure to
report all interest or dividends, (b) the IRS has notified me that I am no
longer subject to backup withholding, or (c) I am exempt from backup
withholding.
The undersigned hereby also certifies, under penalties of perjury,
that the undersigned, 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 Code and Income Tax Regulations). The undersigned understands
that this certification may be disclosed to the IRS by the Company and that any
false statements contained herein could be punished by fine, imprisonment, or
both.
Please issue the payment for the Interests in the name(s) of the
undersigned. Similarly, unless otherwise indicated under "Special Mailing
Instructions," please mail the payment (and accompanying documents, as
appropriate) to the undersigned at the registered address. In the event that
the "Special Mailing Instructions" are completed, please deliver the payment to
the registered holder(s) at the address so indicated.
ANY INTEREST HOLDER WHO DESIRES TO TENDER HIS OR HER INTERESTS BUT IS
UNABLE TO CERTIFY ANY OF THE STATEMENTS SET FORTH ABOVE SHOULD CONTACT THE
COMPANY AT (800) 421-2856 OR (818) 244-8080 FOR FURTHER INSTRUCTIONS.
Solicitation of Vote Regarding Proposed Sale of Partnership Assets
------------------------------------------------------------------
The undersigned hereby consents with respect to all Interests held of
record by the undersigned on April 1, l996, to the following action regarding
the proposal to approve the sale of substantially all of the assets of the
Partnership as described in the Consent Solicitation of Limited Partners dated
April 29, 1996 and disseminated to Interest Holders by the Partnership (the
"Partnership's Consent Solicitation"). The undersigned hereby acknowledges the
receipt of the Partnership's Consent Solicitation and the Offer to Purchase and
revokes any other previously given proxy or consent other than the irrevocable
proxy granted to the General Partners pursuant to Article XXI of the Partnership
Agreement.
-2-
<PAGE>
- --------------------------------------------------------------------------------
TENDER OF INTERESTS IN OFFER AND GRANT OF CONSENT REGARDING
PROPOSED SALE OF PARTNERSHIP ASSETS
I. TENDER OF INTERESTS
The undersigned tenders Interests in the Offer on the terms described above.
II. GRANT OF CONSENT
THIS CONSENT IS BEING SOLICITED ON BEHALF OF PUBLIC STORAGE, INC. (THE
"COMPANY").
The undersigned, a Limited Partner of the Partnership, hereby votes all
Interests held of record by the undersigned on April 1, l996, as follows by
checking the appropriate blank below in blue or black ink:
Proposal to approve the sale of substantially all of the assets
of the Partnership as described in the Consent Solicitation of
Limited Partners dated April 29, 1996.
______ For ______ Against ______ Abstain
IN THE ABSENCE OF SPECIFIED INSTRUCTIONS, SIGNED CONSENTS WILL BE VOTED
AGAINST THE PROPOSAL SET FORTH ABOVE.
III. SIGNATURE(S)
When the Interests are held by joint tenants, both joint tenants should sign.
When the Interests are held of record by a tax-exempt Interest Holder, the
signature of the custodian for trustee is also required.
Signature(s) ___________________________________________________________________
___________________________________________________________________
Social Security or Taxpayer Identification Number ______________________________
Date _______________________________ (________) _______________________
Telephone number
(Must be signed by registered holder(s) as name(s) appear(s) under
registration above. If signature is by trustees, executors, administrators,
guardians, attorneys-in-fact, agents, officers of corporations or partnerships
or others acting in a fiduciary or representative capacity, please provide the
following information. See Instruction 3.)
Name ___________________________________________________________________________
___________________________________________________________________________
(Please print)
Capacity (full title) __________________________________________________________
Address ________________________________________________________________________
Zip Code
________________________________________________________________________________
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SPECIAL MAILING INSTRUCTIONS
To be completed ONLY if payment is to be issued to the registered holders(s)
but mailed to OTHER than the address of record. (See Instruction 5.)
Mail payment to:
Name ___________________________________________________________________________
(Must be same as registered holder(s))
Address ________________________________________________________________________
(Please print)
________________________________________________________________________
Zip Code
- --------------------------------------------------------------------------------
-3-
<PAGE>
INSTRUCTIONS
Forming Part of the Terms and Conditions of the Offer
1. DELIVERY OF LETTER OF TRANSMITTAL. A properly completed and duly
executed Letter of Transmittal and any other documents required by this Letter
of Transmittal must be received by the Depositary at its address set forth
herein on or prior to May 22, 1996, unless extended.
The method of delivery of this Letter of Transmittal and all other required
documents is at the option and risk of the tendering Interest Holder, and the
delivery will be deemed made only when actually received by the Depositary. If
delivery is by mail, registered mail with return receipt requested, properly
insured, is recommended. In all cases, sufficient time should be allowed to
assure timely delivery.
No alternative, conditional or contingent tenders will be accepted. All
tendering Interest Holders, by execution of this Letter of Transmittal, waive
any right to receive any notice of the acceptance of their Interests for
payment.
2. PARTIAL TENDERS. If fewer than all the Interests held by an Interest
Holder are to be tendered, fill in the number of Interests which are to be
tendered in the section entitled "Number of Interests Tendered." All Interests
held by an Interest Holder will be deemed to have been tendered unless otherwise
indicated.
3. SIGNATURES ON LETTER OF TRANSMITTAL.
(a) If this Letter of Transmittal is signed by the registered holder(s)
of the Interests, the signature(s) must correspond exactly with the Interest
Holder's registration.
(b) If any of the Interests are owned of record by two or more joint
owners, all such owners must sign this Letter of Transmittal.
(c) If any Interests are registered in different names, it will be
necessary to complete, sign and submit as many separate Letters of Transmittal
as there are different registrations.
(d) If this Letter of Transmittal is signed by a trustee, executor,
administrator, guardian, attorney-in-fact, officer of a corporation or
partnership or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and if requested, proper evidence
satisfactory to the Company of such person's authority so to act must be
submitted.
4. TRANSFER TAXES. Except as set forth in this Instruction 4, the Company
will pay or cause to be paid any transfer taxes with respect to the transfer and
sale of Interests to it pursuant to the Offer. If payment of the Offer Price is
to be made to any person other than the registered holder, the amount of any
transfer taxes (whether imposed on the registered holder or such other person)
payable on account of the transfer to such person will be deducted from the
Offer Price unless satisfactory evidence of the payment of such taxes or
exemption therefrom is submitted.
5. SPECIAL MAILING INSTRUCTIONS. If payment for the Interests is to be
issued to the registered holder(s) but mailed to other than the address of
record, the section entitled "Special Mailing Instructions" must be completed.
6. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Requests for assistance
may be directed to, or additional copies of the Offer to Purchase and this
Letter of Transmittal may be obtained from, the Company or the Soliciting Agent
at their respective telephone numbers set forth below.
7. IRREGULARITIES. All questions as to the validity, form, eligibility
(including time of receipt) and acceptance of any tender of Interests will be
determined by the Company, in its sole discretion, and its determination shall
be final and binding. The Company reserves the absolute right to reject any or
all tenders of any particular Interests (i) determined by it not to be in the
appropriate form or (ii) the acceptance for purchase of Interests which may, in
the opinion of the Company's counsel, be unlawful.
IMPORTANT. This Letter of Transmittal, together with all other required
documents, must be received by the Depositary on or prior to May 22, 1996,
unless extended.
<TABLE>
<S> <C> <C>
THE DEPOSITARY: THE SOLICITING AGENT: THE COMPANY:
THE FIRST NATIONAL BANK OF BOSTON CHRISTOPHER WEIL & COMPANY PUBLIC STORAGE, INC.
Shareholder Services (800) 478-2605 Investor Services Department
P.O. Box 1872 (800) 421-2856
Mail Stop 45-01-19 (818) 244-8080
Boston, Massachusetts 02105
(617) 575-3120
</TABLE>
-4-
