SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) Securities
Exchange Act of 1934
Filed by the Registrant [ ]
Filed by a party other than the Registrant [X]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
NOONEY INCOME FUND LTD., L.P.
(Name of Registrant as Specified in Its Charter)
BOND G.P., L.L.C.
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transactions applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined.)
(4) Proposed maximum aggregate value of transaction:
(5) Total Fee paid:
[ ] Fee paid previously with preliminary materials
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing party:
(4) Date filed:
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Bond G.P., L.L.C.
1100 Main - Suite 2100
Kansas City, Missouri 64105
To The Limited Partners:
Enclosed is a Solicitation of Consents seeking the approval by written
consent (the "Consents") of the limited partners (the "Limited Partners") of
Nooney Income Fund Ltd. II, L.P., a Missouri limited partnership (the
"Partnership"), to remove the current general partners and to elect Bond G.P.,
L.L.C., a Missouri limited liability company ("Bond G.P.") as the new general
partner of the Partnership, and to approve the marketing to third parties of the
Partnership assets. Bond G.P. would be entitled to cause the Partnership to
engage in transactions with its affiliates, however, Bond G.P. intends to
contract with an independent third party to market the Properties.
Bond G.P. is an affiliate of Bond Purchase, L.L.C. a limited partner of the
Partnership. The goal of Bond G.P. in soliciting the Consents is to elect Bond
G.P. as the new general partner of the Partnership so that Bond G.P. can seek
opportunities to sell the Partnership's properties, and upon the successful sale
of the properties, to distribute the proceeds of those sales to the Limited
Partners and eventually to seek the orderly liquidation of the Partnership.
A review of documents and reports publicly filed by the Partnership indicates
that the properties held by the Partnership are potentially valuable real estate
assets. Given the recent recovery in real estate markets, and the extremely long
time that the Partnership has held the properties, Bond G.P. believes the
Partnership should be actively seeking opportunities to sell the properties to
third parties now in order to maximize the potential cash returns to the Limited
Partners on their original investment.
Other than one of the properties (Countryside Office Park), the current
general partners have not previously pursued sales of the properties. Bond G.P.
believes that the best way to be sure of a prompt sale of the properties is to
remove the current general partners and elect Bond G.P. as the new general
partner.
We urge you to carefully read the enclosed Consent Solicitation Statement in
order to vote your interests. YOUR VOTE IS IMPORTANT. FAILURE TO VOTE WILL HAVE
THE SAME EFFECT AS A VOTE AGAINST THE PROPOSALS. To be sure your vote is
represented, please sign, date and return the enclosed Consent of Limited
Partner form as promptly as possible in the enclosed, prepaid envelope. If you
have any questions, please do not hesitate to contact Bond G.P. at (816)
421-4670.
Very Truly Yours,
Bond G.P., L.L.C.
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SOLICITATION OF CONSENTS
of
LIMITED PARTNERS
of
Nooney Income Fund Ltd. II, L.P.
by
Bond G.P., L.L.C.
a Missouri limited liability company
August 23, 1999
CONSENT SOLICITATION STATEMENT
Bond G.P., L.L.C. a Missouri limited liability company ("Bond G.P."), is an
affiliate of Bond Purchase, L.L.C., a Missouri limited liability company that is
a limited partner of the Partnership ("Bond Purchase"). Bond G.P. is seeking the
approval by written consent (the "Consents") of the limited partners (the
"Limited Partners") of Nooney Income Fund Ltd. II, L.P., a Missouri limited
partnership (the "Partnership"), to remove the current general partners and to
elect Bond G.P. as the new general partner of the Partnership, and to approve
the marketing of the Partnership assets. The election of Bond G.P. as a general
partner is conditioned upon the approval of the removal of the current general
partners.
In the event that the current general partners are removed and Bond G.P. is
not elected as the new general partner, Bond G.P. will initiate an additional
consent solicitation to elect a general partner. During such time, the current
general partners would continue to manage the Partnership as the general
partners.
This Consent Solicitation Statement and the accompanying form of Consent of
Limited Partners are first being mailed to Limited Partners on or about August
26, 1999. The participants in this solicitation are Bond G.P., Bond Purchase,
David L. Johnson and Christine A. Robinson.
In reviewing this Consent Solicitation Statement please consider the
following:
- The Partnership has held its real estate properties (the "Properties") for
over 12 years; although the Partnership was originally anticipating to
sell or refinance its properties within 5 to 10 years after their
acquisition. Based on the fact that the real estate market has improved in
recent years Bond G.P. believes that the Partnership should be actively
seeking opportunities to sell the Properties.
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- The Partnership acquired interests in five real property investments.
- If Bond G.P. is successful in replacing the current general partners, Bond
G.P. expects to actively market the Properties.
- If Bond G.P. is appointed as the new general partner, it or its affiliates
would generally be entitled to the same fees as previously paid to the
current general partners. Bond G.P. intends to contract with an
independent third party to market the Properties. Bond G.P. hereby agrees,
upon its election as the new general partner, to reduce property
management fees and any other fees payable to the general partner or its
affiliates by at least 20%.
- No consents are being solicited hereby to approve any sales transaction by
the Partnership. Bond G.P. has not identified or contacted any potential
buyers for any of the Properties. The Limited Partners will be asked at a
later date to consent to any agreement Bond G.P. obtains to sell all or
substantially of the Properties, as provided in the Partnership Agreement.
- If Bond G.P. is appointed as the new general partner, it will be entitled
to the same participation interest in all profits, losses and
distributions of the Partnership to the same extent as the former general
partners. During 1998, cash distributions of $22,046.00 were paid to the
general partners by the Partnership.
- On November 6, 1997, the original general partners, with whom the original
Limited Partners invested their money, sold out their interests as general
partners of the Partnership. The management subsidiary has received
$215,198 in management fees and $40,000.00 as reimbursement for indirect
expenses for the year ended December 31, 1998. The current general
partners will continue to collect management fees until they sell the
Properties, and therefore have a financial incentive not to sel the
Properties. The current general partners do not own any Partnership
interests. Although Bond G.P. may also have a financial incentive not to
sell the Properties because it also will receive management fees, Bond
G.P.'s incentive not to sell the properties is less because (i) it will be
collecting management fees which are 20% less for managing the Properties
and (ii) its affiliate holds 59 Partnership Units (less than one percent
of the total units outstanding). Therefore, Bond G.P. has a stronger
incentive to ensure the prompt sale of the Properties at a favorable
price.
There are other investment considerations which should be weighed in
replacing the current general partners with Bond G.P. Limited Partners are
advised to read this
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Consent Solicitation Statement carefully and to consult with their investment
and tax advisors. YOUR VOTE IS IMPORTANT. FAILURE TO VOTE WILL HAVE THE SAME
EFFECT AS A VOTE AGAINST THE PROPOSALS.
The Consents are solicited upon the terms and subject to the conditions of
this Consent Solicitation Statement and the accompanying form of Consent.
Removal of the current general partners and the election of Bond G.P. as the new
general partner, requires the consent of the record holders of a majority of the
units of interest ("Units") of the Limited Partners (the "Required Consents").
If Bond G.P. receives the Required Consents, it will promptly complete the
necessary requirements to become the new general partner, as provided in the
Partnership's Agreement and Certificate of Limited Partnership dated February
12, 1985, (the "Partnership Agreement"). See PROPOSALS AND SUPPORTING STATEMENT
Admission of a New General Partner.
Section 6.9.A of the Partnership Agreement provides that the limited partners
whose combined capital contributions represent at least a majority of the total
capital contributions of the limited partners may remove a general partner.
Although Section 6.9 does not indicate what methods may be used to get the
approval of a majority of the limited partners, in Article One of the
Partnership Agreement, "Consent of the Limited Partners" is defined to mean the
written consent or vote to do the act or do the thing for which the consent or
vote is solicited. Section 10.12 of the Partnership Agreement provides a
mechanism for calling meetings of the limited partners pursuant to which the
Limited Partners would act by majority vote. Although Section 6.9.A of the
Partnership Agreement does not use the defined term "Consent of the Limited
Partners," we believe that because the Partnership Agreement contemplates
consent solicitations being used by the Limited Partners, obtaining the consent
of a majority of the limited partners to remove the general partners through a
consent solicitation would be binding on the Partnership's general partners.
However, neither the Partnership Agreement nor state law specifically authorizes
the removal of general partners by a consent solicitation. The Partnership
previously obtained Limited Partner Consent to amend the Partnership Agreement
by a consent solicitation dated October 4, 1995.
THIS SOLICITATION IS BEING MADE BY BOND G.P. AND NOT ON BEHALF OF THE
PARTNERSHIP. CONSENTS SHOULD BE DELIVERED TO BOND G.P. AND NOT TO THE
PARTNERSHIP.
THE SECURITIES AND EXCHANGE COMMISSION HAS NOT PASSED UPON THE ACCURACY OR
ADEQUACY OF THE INFORMATION CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO
THE CONTRARY IS UNLAWFUL.
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THIS SOLICITATION OF CONSENTS EXPIRES NO LATER THAN 11:59 P.M. EASTERN TIME
ON OCTOBER 15, 1999, UNLESS EXTENDED.
INFORMATION CONCERNING BOND G.P.
Bond G.P. is a Missouri limited liability company that was formed in 1999 for
the purpose of seeking to become the general partner of other real estate
limited partnerships. Bond G.P. is currently soliciting consents to remove the
general partners of Nooney Income Fund Ltd., L.P. and Nooney Real Property
Investors-Two, L.P. The sole Manager of Bond G.P. is Bond Purchase, which
manages all of the business affairs of Bond G.P. Bond Purchase holds interests
in the Partnership and other real estate limited partnerships for investment
purposes. The principal office of Bond Purchase, L.L.C. is 1100 Main - Suite
2100, Kansas City, MO 64105; telephone (816) 421-4670.
The resumes of the individual participants of the solicitation and the
members of the executive management and principal members of Bond Purchase are
set forth below. None of the participants of the solicitation have effected any
purchases or sales of Units within the past two years.
David L. Johnson. Mr. Johnson, age 43, is Chairman, Chief Executive Officer,
and majority shareholder of Maxus Properties, Inc. Mr. Johnson is also currently
Vice President of KelCor, Inc., a Missouri corporation ("KelCor") that
specializes in the acquisition of commercial real estate and the purchase of
loans and apartments from lending institutions and agencies of the federal
government. In addition, KelCor acts as a general partner in approximately ten
real estate limited partnerships. Mr. Johnson and his wife own all of the issued
and outstanding stock of KelCor and 80 percent of the issued and outstanding
stock of MJS. Mr. Johnson is also a member of, and majority owner of the
outstanding interests in Bond Purchase. Mr. Johnson is a 1978 graduate of the
University of Missouri-Columbia. Upon graduation, Mr. Johnson joined the
international accounting firm of Arthur Andersen & Co., where he was promoted to
Tax Manager in 1982. At Arthur Andersen, Mr. Johnson specialized in structuring
real estate transactions for clients. In 1988, Mr. Johnson left Arthur Andersen
to pursue a career in the development, syndication and management of commercial
and multi-family real estate projects. Mr. Johnson is a licensed real estate
broker and a certified public accountant in the State of Missouri. As of the
date of this Proxy Statement, Mr. Johnson owns 10 Limited Partner Units and is a
beneficial owner of 656 Limited Partner Units owned by Bond Purchase. Bond G.P.
and Bond Purchase are both affiliated because Johnson has either a direct or
indirect majority ownership interest in both entities.
Daniel W. Pishny. Mr. Pishny, age 36, is President, Chief Operating Officer
and a minority shareholder of Maxus Properties, Inc. Mr. Pishny graduated with
highest distinction from the University of Kansas in 1984 where he obtained a
degree in business
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administration. After graduating, he joined the Kansas City office of KPMG Peat
Marwick, an international accounting firm. At KPMG Peat Marwick, Mr. Pishny was
promoted to Audit Manager, specializing in the auditing of financial
institutions. From 1990 to 1995, Mr. Pishny worked in the commercial real estate
lending departments of two major Kansas City financial institutions. Mr. Pishny
joined Maxus in 1995 and is responsible for the day-to-day operations of Maxus
and its managed properties.
John W. Alvey. Mr. Alvey, age 40, is Executive Vice President, Chief
Financial Officer and a minority shareholder of Maxus Properties, Inc., and
President of KelCor, Inc. Mr. Alvey holds a degree from Rockhurst College and a
Masters of Accountancy from Kansas State University. In 1982, Mr. Alvey joined
Arthur Andersen & Co., where he was promoted to Tax Manager working primarily on
real estate matters for individual clients. Mr. Alvey joined Maxus in 1988 after
spending one year working with a Kansas City-area real estate company. Mr. Alvey
became President of KelCor, Inc. in 1992. Mr. Alvey is responsible for the
day-to-day accounting functions, risk management and taxes for Maxus and its
managed properties.
Christine A. Robinson. Ms. Robinson, age 32, is currently Vice President and
a minority shareholder of Maxus. Ms. Robinson has served as Vice President of
Maxus since September, 1997. Prior to September 1997, Ms. Robinson served as
Sales/Marketing/Financial Analyst for American Italian Pasta Company, a retail
pasta manufacturing and sales company, and also worked as an independent
contractor for American Management Association, a company that provides
management, finance and inventory seminars. Ms. Robinson graduated Magna Cum
Laude from Kansas State University in 1990 where she received a degree in
accounting.
Amy Kennedy. Controller. Ms. Kennedy, age 31, obtained a Bachelors degree
from the University of Kansas in 1991. Ms. Kennedy worked as an accountant for
School Services and Leasing, a national sales and leasing firm, prior to joining
Maxus in 1992 and is also a minority shareholder of Maxus. Ms. Kennedy is
responsible for general accounting functions and monthly financial statements
for all Maxus managed properties.
Robert Thomson. Attorney. Mr. Thomson, age 52, is a practicing attorney in
Kansas City, Missouri, where he has been so engaged since graduation in 1972
from the University of Missouri at Kansas City School of Law (Order of Bench and
Robe; Class Ranking - First). From 1972-73 he was Law Clerk to the Honorable
Elmo B. Hunter, United States District Court, Western District of Missouri.
Mr. Thomson was with the Kansas City, Missouri office of the law firm Linde
Thomson Langworthy Kohn & Van Dyke, P.C. from 1973 to 1990, with a practice
emphasizing business, corporate and securities law. He has been a lecturer on
securities law and a frequent speaker in that area at various seminars and
meetings, including the Missouri Society of Certified Public Accountants Tax
Shelter Workshop, Syndications
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Conference for the Missouri Society of Certified Public Accountants, Annual
Syndication Conference, Missouri Society of Certified Public Accountants (St.
Louis, Missouri), Structuring and Evaluating Tax Shelters after ERTA, Tax
Shelters, Real Estate and Oil and Gas, and moderator of Current Developments in
Securities, Tax and Corporate Law for the University of Missouri at Kansas City
and Kansas City Bar Association.
Additionally, Mr. Thomson authored the 1999 Employment Agreement sections of
the Missouri Corporate and Partnership Forms Handbook, was editor and
contributor of the UMKC-CLE publication "Understanding Tax Shelters" and has
participated at various breakfast and luncheon presentations before realtors,
title companies and continuing legal education programs. Mr. Thomson has served
on the Sub-Committee on Real Estate Programs, Regulation of Securities Committee
of the ABA Section on Corporate, Banking and Business Law, and is currently a
member of the Kansas City Bar Association, the Missouri Bar and the American Bar
Association.
INFORMATION CONCERNING THE PARTNERSHIP
Information contained in this section is based upon documents and reports
publicly filed by the Partnership, including the Annual Report on Form 10-K for
the fiscal year ended December 31, 1998 (the "Form 10-K"). Although Bond G.P.
has no information that any statements contained in this section are untrue,
Bond G.P. has not independently investigated the accuracy of statements, and
takes no responsibility for the accuracy, inaccuracy, completeness or
incompleteness of any of the information contained in this section or for the
failure by the Partnership to disclose events which may have occurred and may
affect the significance or accuracy of any such information.
Former and Current General Partners
The Partnership is a limited partnership formed under the Missouri Uniform
Limited Partnership Law on February 12, 1985. The Partnership's purpose is to
invest, on an all cash basis, in income-producing real properties such as
shopping centers, office buildings, office/warehouses and other commercial
properties. The original general partners were Gregory J. Nooney, Jr., G. J.
Nooney, John J. Nooney, James J. O'Connor III, James J. Finn, Douglas H. Wilton
and Nooney Income Investments Two, Inc. The current General Partners are Nooney
Income Investments Two, Inc. and John J. Nooney as a Special General Partner.
On November 6, 1997, Nooney Company sold its wholly-owned subsidiary, Nooney
Investors, Inc., the corporate general partner of the Registrant to S-P
Properties, Inc., a California corporation, which in turn is a wholly-owned
subsidiary of CGS Real Estate Company, Inc., a Texas corporation.
Simultaneously, Gregory J. Nooney, Jr., an individual general partner and PAN,
Inc., a corporate general partner, sold their economic interests to S-P
Properties, Inc. and resigned as general partners.
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Following the sale, control of the Registrant now rests with CGS Real Estate
Company, Inc. CGS Real Estate Company, Inc. is owned 50% each by John N.
Galardi, Chairman of the Board, and William J. Carden, President. Mr. Galardi is
founder of the Galardi Group which controls and manages over 500 fast food
restaurants. Mr. Carden founded CGS Real Estate Company, Inc. in 1990 and has
been active in commercial real estate for over 25 years. CGS, through its
wholly-owned subsidiaries, manages over 25 million square feet for third party
owners, its own account and several public partnership programs where the
company acts as general partner.
The purchase described above was part of a larger transaction whereby CGS
Real Estate Company, Inc. purchased (a) the entire real estate management
business operated by Nooney Company through its wholly-owned subsidiary, Nooney
Krombach Co., (b) all controlling interests in corporate general partners for
all public partnerships, namely Nooney Income Fund Ltd., L.P., Nooney Real
Property Investors-Four, L.P., Nooney Real Property Investors-Two, L.P., and
Nooney Income Fund Ltd., II, L.P., (c) all investment real estate owned by
Nooney Company through other wholly-owned subsidiaries, and (d) the controlling
interest in a private partnership which acts as an external advisor to Nooney
Realty Trust, a publicly held real estate investment trust traded on the NASDAQ
exchange.
The consideration for the purchase of all corporate general partner interests
owned by Nooney Company was $92,000 cash. The consideration for purchase of
Gregory J. Nooney, Jr.'s and PAN, Inc.'s general partner interests in the four
public partnerships and Nooney Advisors Ltd., L.P. was $243,186.43, paid by
assumption of a note payable held by an unrelated individual.
Although Limited Partners have not received the financial benefits originally
anticipated from this Partnership due to the failure of the general partners to
sell or refinance the Properties as they had planned within five to ten years
after the formation of the Partnership, Bond G.P. believes that the former
general partners and their affiliates received substantial "front-end fees"
during the Partnership's organization and acquisition phase, and recently
received further consideration to sell out their interests as general partners
of the Partnership, as described above. Pursuant to Section 5.8 of the
Partnership Agreements the General Partner or any Affiliate thereof may receive
fees and commissions ("Acquisition Fees") from the Partnership or others on
purchases of Property by the Partnership; however, such fees shall not exceed 5%
of the gross proceeds received by the Partnership from the offering or the Units
as set forth in Section 4.2A hereof. 5% of the gross proceeds is $961,050.00 The
Partnership has not disclosed whether such Acquisition Fees were actually paid
to the general partners or the amount of the total fees paid to the general
partners. In addition, from 1985 until the present, affiliates of the former
general partners received substantial property management and other fees.
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Partnership Properties
The partnership invested in five real property investments. The Properties
are described below.
On February 20, 1985, the Registrant acquired a 24% interest as a tenant in
common in Leawood Fountain Plaza, a three building office complex in Leawood,
Kansas. Constructed in two phases in 1982 and 1983, the buildings contain
approximately 30,000, 29,000 and 26,000 net rentable square feet of office
respectively, or an aggregate of approximately 85,000 net rentable square feet
of office space. The buildings are located on a 7.9 acre site which provides
paved parking for 403 cars. The purchase price of the complex was $9,626, 576,
of which $2,310,379 was paid by the Registrant for its 24% interest. The
remaining 76% interest was purchased by Nooney Income Fund, Ltd., L.P., an
affiliate of the Registrant, as the other tenant in common. All costs and
revenues attributable to the operation of the complex are shared by the
Registrant and Nooney Income Fund Ltd., L.P. in proportion to their respective
percentage interests. The complex was 97% leased by 41 tenants at December 31,
1998.
On March 20, 1986, the Registrant acquired the Tower Industrial Building, an
office warehouse located at 750-760 Tower Road in Mundelein, Illinois, A suburb
or Chicago. The purchase price of the building was $1,235,280. The one-story
concrete block building contains approximately 42,000 net rentable square feet
and is situated on a 3 acre site which provides parking for 140 cars. As of
December 31, 1998 the building was 100% leased by Baxter International, Inc.
On December 16, 1986, the Registrant acquired a 50% interest as a tenant in
common in Countryside Executive Center, a single story office building located
at 1210-1270 W. Northwest Highway in Palatine, Illinois, a suburb of Chicago.
The building contains approximately 91,000 net rentable square feet and is
situated on an 8.6 acre site which provides parking spaces for 467 cars, some of
which spaces are shared with adjoining properties pursuant to a mutual easement
agreement which also provides for the sharing of certain expenses. The total
purchase price of the building was $9,853,660, of which $4,926,830 was paid by
the Registrant for its 50% interest. The remaining 50% interest was purchased by
Nooney Income Fund III, L.P., an affiliate of the Registrant, and during 1993
was transferred to a subsidiary of the mortgage lender. As of December 31, 1995,
the Registrant acquired the mortgage lender's interest in Countryside Executive
Center for $1,250,000. Prior to December 29, 1995, all costs and revenues
attributable to the operation of the building were shared by the Registrant and
a subsidiary of the mortgage lender in proportion to their respective percentage
interests. Effective October 1998, the property was renamed Countryside Office
Park. The building was 77% leased by 34 tenants at December 31, 1998.
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On December 29, 1986, the Registrant acquired a 45% interest as a tenant in
common in Wards Corner Business Center A & B, a two building
office/warehouse/showroom facility located at 420-422 Wards Corner Road in
Loveland, Ohio, a suburb of Cincinnati. Effective January 1, 1996, the property
known as Wards Corner was renamed Northeast Commerce Center. The two
single-story buildings contain 50,000 net rentable square feet each, or an
aggregate of approximately 100,000 net rentable square feet. The building are
situated on a 7.5 acre site which provides parking for 278 cars. The total
purchase price of the buildings was $6,630,395, of which $2,983,678 was paid by
the Registrant for its 45% interest. The remaining 55% interest was purchased by
Nooney Income Fund Ltd., III, L.P., an affiliate of the Registrant, and during
1993 was transferred to a subsidiary of the mortgage lender. As of December 29,
1995, the Registrant acquired the mortgage lender's interest in Northeast
Commerce Center for $1,980,000. Prior to December 29, 1995, all costs and
revenues attributable to the operation of the building were shared by the
Registrant and a subsidiary of the mortgage lender in proportion to their
respective percentage interest. The buildings were 50% leased by 3 tenants at
December 31, 1998.
On December 29, 1986, the Registrant acquired a 45% interest as a tenant in
common in NorthCreek Office Park, a three building office complex located at
8220, 8240 and 8260 NorthCreek Drive in Cincinnati, Ohio. Constructed in phases
in 1984 and 1986, the three-story buildings contain 19,500, 24,000 and 48,000
net rentable square feet respectively, or an aggregate of approximately 91,500
net rentable square feet. The buildings are located on a 8.4 acre site which
provides paved parking for 366 cars. The purchase price of the complex was
$11,063,260, of which approximately $4,978,467 was paid by the Registrant for
its 45% interest. The remaining 55% interest was purchased by Nooney Income Fund
Ltd. III, L.P., an affiliate of the Registrant, and during 1993 was transferred
to a subsidiary of the mortgage lender. As of December 29, 1995, the Registrant
acquired the mortgage lender's interest in NorthCreek Office Park for
$3,960,000. Prior to December 29, 1995, all costs and revenues attributable to
the operation of the complex were shared by the Registrant and a subsidiary of
the mortgage lender in proportion to their respective percentage interests. The
complex was 100% leased by 34 tenants at December 31, 1998.
According to the Partnership's Form 10-K, it was originally anticipated that
the Partnership would sell or refinance its properties within approximately five
to ten years after their acquisition.
It has been more than 12 years since the Partnership commenced operations.
The original investment expectations have not been met.
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Outstanding Units
According to the Partnership's Form 10-K, there were 19,221 Units issued and
outstanding at December 31, 1998, held by 1,335 holders of record. A Limited
Partner is entitled to one vote for each Unit owned by such Limited Partner.
Bond G.P.'s affiliates own 59 Units, or less than 1% of the outstanding Units.
According to the Form 10-K, neither the Former general partners nor the current
general partners owns any Units.
PROPOSALS AND SUPPORTING STATEMENT
The Limited Partners are being asked to approve by written consent the
following actions (the "Proposals") pursuant to the Partnership Agreement:
(1) the removal of the current general partners, Nooney Income Investments
Two, Inc. and special General Partner, John J. Nooney, as the general partners
of the Partnership;
(2) the election of Bond G.P. as the new general partner of the Partnership
(which is conditioned upon the approval of the removal of the current general
partners); and
(3) approve marketing of the sale of the Partnership's Properties.
Bond G.P. believes that the Proposal is in the interest of all Limited
Partners and strongly encourages all Limited Partners to approve the Proposals.
A review of documents and reports publicly filed by the Partnership indicates
that the Properties held by the Partnership are potentially valuable real estate
assets. Given the recent recovery in real estate markets, and the extremely long
time that the Partnership has held the Properties, Bond G.P. believes the
Partnership should be actively seeking opportunities to sell the Properties to
third parties now in order to maximize the potential cash returns to the Limited
Partners on their original investment.
The current managing general partner recently purchased from the former
general partners, among other things, the right to manage the Partnership and
collect the management fees. The general partner's management subsidiary
received $215,198 in management fees and $40,000 reimbursement of indirect
expenses for the twelve months ended December 31, 1998. Bond G.P. intends to
contract with an independent third party to market the Properties and has
committed to reduce property management fees and any other fees payable to the
general partner or its affiliates by at least 20%.
The current managing general partner will continue to collect management fees
until it sells the Properties, and therefore has a financial incentive not to
sell the Properties.
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Although Bond G.P. may have a financial incentive not to sell the Properties
because it also will receive management fees, Bond G.P.'s incentive to sell the
properties is less because (i) it will receive management fees which are 20%
less than the current fees for managing the Properties and (ii) it has an
affiliate that owns Units. Therefore, Bond G.P. has an incentive to ensure the
prompt sale of the Properties at a favorable price. The current general partners
own no Units in the Partnership and therefore do not have the same financial
incentive to sell the Properties as do the Limited Partners.
There is no prohibition against Bond G.P. selling the properties to an
affiliate. However, Bond G.P. plans to have the properties marketed by an
independent broker. At this time, there is no plan for an affiliate of Bond G.P.
to buy these properties.
Bond G.P. believes that removing the current general partners and electing
Bond G.P. as the new general partner will provide the Limited Partners with the
best potential to maximize the potential cash returns to the Limited Partners in
the near future. Bond G.P.'s belief is based on (i) the expectation that, upon
its election as the new general partner, it will immediately actively market the
Properties and (ii) the fact that the current general partners have not
disclosed that they are seeking to sell any of the Properties except for
Countryside Office Park. Bond G.P. believes that the best way to be sure of a
prompt marketing of the Properties is to remove the current general partners and
elect Bond G.P. as the new general partner.
No consents are currently being solicited to approve any sales transaction by
the Partnership. Bond G.P. has not identified nor contacted any potential buyers
for any of the Properties. If Bond G.P. is admitted as the new general partner,
it expects to sell the Properties for cash within the next 24 months, pay off
any related debt not assumed by a buyer, pay selling expenses, distribute the
net proceeds to the Limited Partners in accordance with the Partnership
Agreement, and liquidate and dissolve the Partnership. Any such sales would be
dependent upon the condition of the Properties at such time of proposed sale,
local market conditions for the areas in which the Properties are located,
general economic conditions, interest rates and the availability of financing
for the purchase of one or more of the Properties. Liquidation of the
Partnership would occur as soon as practicable and in an orderly manner after
the sale of all the Properties. Consent of the Limited Partners for sale of all
or substantially all of the Properties will be obtained in accordance with the
Partnership Agreement. No assurance can be given regarding the timing or
proceeds of any sales of the Properties or the timing of the liquidation.
Consent of the Limited Partners for the sale of all or substantially all of
the Properties will be obtained in accordance with the Partnership Agreement.
Section 5.2.B(i) of the Partnership Agreement provides that the general partners
shall not, without the consent of the Limited Partners, sell or otherwise
dispose of, at one time, all or substantially all of the assets of the
Partnership. Consent is only required if the Partnership sells all or
substantially all of the Properties. Bond G.P. intends to sell all or
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substantially all of the Properties and therefore would be required to obtain
the consent of the Limited Partners.
Admission of New General Partner
Upon satisfaction of the conditions of succession by Bond G.P. as the new
general partner, the current general partners shall be removed as general
partner and Bond G.P. shall simultaneously become the general partner.
Thereafter, the current general partners will not retain any of the rights,
powers or authority accruing to the general partner following their removal as
general partners; provided, however, that the Partnership must purchase the
current general partners' interest in the Partnership in the manner and for an
amount determined as provided in the Partnership Agreement. If Bond G.P. is
appointed as the new general partner, it will be entitled to the same percentage
interest in all profits and losses, and cash distributions made by the
Partnership prior to dissolution as which the current general partners are
entitled to. In the event the current general partners are removed, Bond G.P. is
elected as the new general partner and the Properties are then sold, the current
general partners would not be entitled to any distribution, but Bond G.P. would
be entitled to a distribution of up to 15% of the total amount distributed,
after the limited partners have received a return of their adjusted capital
contributions plus a 11% return thereon. Bond G.P. does not believe that the
ultimate sale price for the Properties would result in any payment to the
general partners, whether the general partners remain as presently constituted
or replaced by Bond G.P.
Bond G.P. believes that the Partnership would not have to pay anything to the
current general partners to buy their general partner interests. Section 6.9.C
of the Partnership Agreement provides that within sixty (60) days after the
removal of a general partner, two independent appraisers shall appraise the
partnership's net assets, and in the event that the two appraisers are unable to
agree upon the value, such appraisers will appoint a third appraiser to submit a
final and binding determination. The Partnership is required to pay all fees and
expenses incurred with respect to such appraisal. In making the appraisal, the
appraisers are to assume that (i) the Partnership's assets were sold on the date
the general partner was removed and (ii) the Partnership is liquidated in
accordance with Section 8.4 of the Partnership Agreement. Section 8.4.A provides
that, upon liquidation and dissolution of the Partnership, before any payments
are made to the general partners, the balance of any funds remaining after
payments for debts, liabilities and loans of the partnership, shall be
distributed pro rata to each limited partner in an amount equal to his "Adjusted
Capital Contribution." Bond G.P. estimates the value of the net assets of the
Partnership to be $9,568,937 (based on the Partnership's 10-K for the calendar
year ending December 31, 1998). This estimate is reached by (i) capitalizing the
sum of the Partnership's 1998 net income plus depreciation, amortization and
interest expenses at ten percent and (ii) subtracting from such amount (x) the
Partnership's total liabilities as of December 31, 1998 and (y) estimating
closing costs of the sale of five percent. In addition, the estimated value
includes the Partnership's cash on hand as of December 31,
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1998. Based on this value of $9,568,937, the entire estimated value of the
assets would be paid to the limited partners because Bond G.P.'s estimate of the
"Adjusted Capital Contribution" as of December 31, 1998 is $19,221,000. Thus,
the value of the net assets is far less than the Limited Partners' estimated
Adjusted Capital Contribution. Thus, the general partners would not be entitled
to payment for its interests pursuant to Section 8.4.A of the Partnership
Agreement. However, the Partnership would have to pay the expenses of the
appraisals which Bond G.P. estimates to be approximately $75,000 (three
appraisals for each of the five properties at $5,000 each).
The "conditions of succession" for Bond G.P. becoming a general partner once
it receives a majority of the consents are that (i) Bond G.P. must agree to be
bound by the provisions of the Partnership Agreement; (ii) an amendment to the
Certificate of the Limited Partnership must be filed with the Missouri Secretary
of State to reflect the admission of Bond G.P. as a successor general partner
and (iii) either (a) a court of competent jurisdiction in the State of Missouri
shall have determined in an action for declaratory judgment or similar relief
brought on behalf of the Limited Partners that the exercise of the removal of
the general partners will not result in the loss of limited liability to the
Limited Partners or violate the Missouri Uniform Limited Partnership Law or (b)
counsel for Limited Partners shall deliver an opinion to the same effect
satisfactory to the limited partners seeking to remove the general partner that
such removal will not result in the loss of the limited liability of the Limited
Partners or violate the Missouri Uniform Limited Partnership Law. Bond G.P. does
not believe it will have any difficulty in satisfying these condition of
succession.
If the limited partners elect Bond G.P. as General Partner, but do not adopt
the proposal to sell the partnership assets, Bond G.P. intends to operate the
properties with 20% lower fees.
Bond G.P. has indicated its desire to become the new general partner and,
other than a subsequent material adverse change in the Partnership, Bond G.P.
does not anticipate any circumstance under which it would not desire to become
the new general partner. A material adverse change would include bankruptcy,
foreclosure or other impairments on the value or operations of the Properties. A
condition to succession is the delivery of a legal opinion required by the
Partnership Agreement. Bond G.P. believes such condition can be satisfied within
ten days of receiving the Required Consents. Bond G.P. reserves the right to
withdraw before admission as the new general partner in the event of a material
adverse change in the Partnership or in the event Bond G.P. is unable to satisfy
or obtain a waiver of the conditions of succession by Bond G.P. as the new
general partner under the Partnership Agreement.
Bond G.P., as the new general partner, will be entitled to the same
distributions and allocations as the current general partners i.e., 1% interest
in all profits and losses and 10% of cash distributions of the Partnership and
up to 15% of distributions upon
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liquidation, after the limited partners have received a return of their Adjusted
Capital Contribution plus 11% interest thereon. Bond G.P. does not believe that
the 15% liquidation distribution to the general partner will ever take place.
Under the terms of the Partnership Agreement, the Partnership is entitled to
engage in various transactions involving affiliates of the general partner. If
Bond G.P. is appointed as the new general partner, it will examine any existing
agreements between the Partnership and any affiliates of the current general
partner and expects to terminate some or all of those agreements. Bond G.P.
would be entitled to cause the Partnership to engage in transactions with its
affiliates, however, Bond G.P. intends to contract with an independent third
party to market the Properties and has committed to reduce property management
fees and any other fees payable to it or its affiliates by at least 20%. In
addition, Bond G.P. could enter into other kinds of transactions with its
affiliates.
VOTING PROCEDURE FOR LIMITED PARTNER
Distribution and Expiration Date of Solicitation
This Consent Solicitation Statement and the related Consent are first being
mailed to Limited Partners on or about August 26, 1999. Limited Partners who are
record owners of Units as of August 23, 1999 (the "Record Date") may execute and
deliver a Consent. A beneficial owner of Units who is not the record owner of
such Units must arrange for the record owner of such Units to execute and
deliver to Bond G.P. a Consent that reflects the vote of the beneficial owner.
This solicitation of Consents will expire at 11:59 p.m. Eastern Time on the
earlier to occur of the following dates (the "Expiration Date"): (i) October 15,
1999 or such later date to which Bond G.P. determines to extend the
solicitation, and (ii) the date the Required Consents are received. Bond G.P.
reserves the right to extend this solicitation of Consents for such period or
periods as it may determine in its sole discretion from time to time; provided,
however that it will not extend this solicitation past August 23, 2000. Any such
extension will be followed as promptly as practicable by notice thereof by press
release or by written notice to the Limited Partners. During any extension of
this solicitation of Consents, all Consents delivered to Bond G.P. will remain
effective, unless validly revoked prior to the Expiration Date.
Bond G.P. reserves the right for any reason to terminate the solicitation of
Consents at any time prior to the Expiration Date by giving written notice of
such termination to the Limited Partners.
Voting Procedures and Required Consents
The consent of Limited Partner form included with this Consent Solicitation
Statement is the ballot to be used by Limited Partners to cast their votes. For
each
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Proposal, Limited Partners should mark a box adjacent to the Proposal indicating
that the Limited Partner votes "For" or "Against" the Proposal, or wishes to
"Abstain." All Consents that are properly completed, signed and delivered to
Bond G.P., and not revoked prior to the Expiration Date, will be given effect in
accordance with the specifications thereof. If none of the boxes on the Consent
is marked, but the Consent is otherwise properly completed and signed, the
Limited Partner delivering such Consent will be deemed to have voted "For" the
Proposals.
Each proposal requires the consent of the record holders of a majority of the
Units of the Limited Partners (the "Required Consents"). Accordingly, adoption
of each Proposal requires the receipt without revocation of the Required
Consents indicating a vote "For" the Proposal. Bond G.P. is seeking approval of
both of the Proposals, but neither Proposal is conditioned in any way on the
approval of the other Proposal. The failure of a Limited Partner to deliver a
Consent or a vote to "Abstain" will have the same effect as if such Limited
Partner had voted "Against" the Proposals. Units not voted on Consents returned
by brokers, banks or nominees will have the same effect as Units voted against
the Proposals.
If Units to which a Consent relates are held of record by two or more joint
holders, all such holders must sign the Consent. If a Consent is signed by a
trustee, partner, executor, administrator, guardian, attorney-in-fact, officer
of a corporation or other person acting in a fiduciary or representative
capacity, such person must so indicate when signing and must submit with the
Consent form appropriate evidence of authority to execute the Consent. In
addition, if a Consent relates to less than the total number of Units held in
the name of such Limited Partner, the Limited Partner must state the number of
Units recorded in the name of such Limited Partner to which the Consent relates.
If a Consent is executed by a person other than the record owner, then it must
be accompanied by a valid proxy duly executed by the record owner.
All questions as to the validity, form, eligibility (including time of
receipt), acceptance, and revocation of Consents, and the interpretation of the
terms and conditions of this solicitation of Consents, will be determined by
Bond G.P., subject to the provisions of the Partnership Agreement, as well as
state and federal law. Bond G.P. reserves the absolute right to reject any or
all Consents that are not acceptable. Bond G.P. also reserves the right to waive
any conditions as to particular Consents or Units. Unless waived, in connection
with Consents must be cured within such determines. None of Bond G.P., any of
its affiliates, or any be under any duty to give any notification of any such
defects, irregularities or waiver, nor shall any of them incur any liability for
failure to give such notification. Deliveries of Consents will not be deemed to
have been made until any irregularities or defects therein have been cured or
waived.
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Completion Instructions
Limited Partners are requested to complete, sign and date the Consent of
Limited Partner form included with this Consent Solicitation Statement and mail,
hand deliver, or send by overnight courier the original signed Consent to Bond
G.P.
Consents should be sent or delivered to Bond G.P. and not to the Partnership,
at the address set forth on the back cover of this Consent Solicitation
Statement and on the back of the Consent. A prepaid, return envelope is included
herewith.
Power of Attorney
Upon approval of a Proposal, Bond G.P. will be expressly authorized to
prepare any and all documentation and take any further actions necessary to
implement the actions contemplated under this Consent Solicitation Statement
with respect to the approved Proposal. Furthermore, each Limited Partner who
votes for a Proposal described in this Consent Solicitation Statement, by
signing the attached Consent, constitutes and appoints Bond G.P., acting through
its officers and employees, as his or her attorney-in-fact for the purposes of
executing any and all documents and taking any and all actions required under
the Partnership Agreement in connection with this Consent Solicitation Statement
or in order to implement the approved Proposal, including the execution of an
amendment to the Partnership Agreement to reflect Bond G.P. as the new general
partner of the Partnership or to reflect the dissolution of the Partnership in
accordance with the applicable Proposal, and including the selection of an
appraiser to appraise the Partnership's assets as may be required by the
Partnership Agreement.
Revocation of Consents
Consents may be revoked at any time prior to the Expiration Date, or a
Limited Partner may change his vote on one or both Proposals, in accordance with
the following procedures. For a revocation or change of vote to be effective,
Bond G.P. must receive prior to the Expiration Date a written notice of
revocation or change of vote (which may be in the form of a subsequent, properly
executed Consent) at the address set forth on the Consent. The notice must
specify the name of the record holder of the Units and the name of the person
having executed the Consent to be revoked or changed (if different), and must be
executed in the same manner as the Consent to which the revocation or change
relates or by a duly authorized person that so indicates and that submits with
the notice appropriate evidence of such authority as determined by Bond G.P. A
revocation or change of a Consent shall be effective only as to the Units listed
on such notice and only if such notice complies with the provisions of this
Consent Solicitation Statement.
Bond G.P. reserves the right to contest the validity of any revocation or
change of vote and all questions as to validity (including time of receipt) will
be determined by Bond
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G.P., subject to the provisions of the Partnership Agreement, as well as state
and federal law.
Absence of Appraisal Rights
There are no appraisal or other similar rights available to Limited Partners
in connection with this solicitation of Consents.
Solicitation of Consents
Neither the Partnership nor the current general partners are participants in
this solicitation of Consents. Bond G.P., Bond Purchase and its management are
the only participants in the solicitation. Bond G.P. will initially bear all
costs of this solicitation of Consents, including fees for attorneys, and the
cost of preparing, printing and mailing this Consent Solicitation Statement.
Bond G.P. shall seek reimbursement for such costs from the Partnership to the
extent allowed under the Partnership Agreement and applicable law. In addition
to the use of mails, certain officers or regular employees of Bond G.P. may
solicit Consents; however, none of these individuals have been specially engaged
to assist the solicitation and no officer or employee will be compensated for
services to assist the solicitation other than reimbursement of any
out-of-pocket expenses relating to the solicitation. The total fees and expenses
to be incurred by Bond G.P. in connection with this solicitation are estimated
to be $25,000. Bond G.P. has incurred fees and expenses in connection with this
solicitation as of August 23, 1999 of approximately $6,000.
Limited Partners are encouraged to contact Bond G.P. at the address and
telephone number set forth on the back cover of this Consent Solicitation
Statement with any questions regarding this solicitation of Consents and with
requests for additional copies of this Consent Solicitation Statement and form
of Consent.
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SOLICITATION OF CONSENTS
of
LIMITED PARTNERS
of
Nooney Income Fund Ltd. II, L.P.
a Missouri Limited Partnership
Deliveries of Consents, properly completed and duly executed, should be made
to Bond G.P. at the address set forth below.
Questions and requests for assistance about procedures for consenting or
other matters relating to this solicitation may be directed to Bond G.P. at the
address and telephone number listed below. Additional copies of this Consent
Solicitation Statement and form of Consent may be obtained from Bond G.P. as set
forth below.
No person is authorized to give any information or to make any representation
not contained in this Consent Solicitation Statement regarding the solicitation
of Consents made hereby, and, if given or made, any such information or
representation should not be relied upon as having been authorized by Bond G.P.
or any other person. The delivery of this Consent Solicitation Statement shall
not, under any circumstances, create any implication that there has been no
change in the information set forth herein or in the affairs of Bond G.P. or the
Partnership since the date hereof.
Bond G.P., L.L.C.
1100 Main - Suite 2100
Kansas City, MO 64105
(816) 421-4670
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<PAGE>
APPENDIX A
(Form of Consent - Definitive Copy)
Nooney Income Fund Ltd. II, L.P.
a Missouri Limited Partnership (the "Partnership")
CONSENT OF LIMITED PARTNER
This Consent is Solicited on Behalf of Bond G.P., L.L.C.
The undersigned has received the Consent Solicitation Statement dated August
23, 1999 ("Consent Solicitation Statement") by Bond G.P., L.L.C., a Missouri
limited liability company ("Bond G.P."), seeking the approval by written consent
of the following proposals:
(1) the removal of the current general partners, Nooney Income Investments
Two, Inc., a Missouri corporation and John J. Nooney, as special general
partner;
(2) the election of Bond G.P. as the new general partner of the Partnership
(which is conditioned on the approval of proposal 1 above); and
(3) the approval to market the Partnership properties.
Each of the undersigned, by signing and returning this Consent, hereby
constitutes and appoints Bond G.P., acting through its officers and employees as
his or her attorney-in-fact for the purposes of executing any and all documents
and taking any and all actions required under the Partnership Agreement in
connection with this Consent and the Consent Solicitation Statement or in order
to implement an approved proposal; and hereby votes all Units of interest in the
capital of the Partnership held of record by the undersigned as follows for the
proposals set forth above, subject to the Consent Solicitation Statement.
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Proposal FOR AGAINST ABSTAIN
1. Removal of General Partner
and Special General Partner [ ] [ ] [ ]
2. Election of New
General Partner, Bond G.P., L.L.C. [ ] [ ] [ ]
3. Marketing of Partnership Assets [ ] [ ] [ ]
(Please sign exactly as your name appears on the Partnership's records. Joint
owners should each sign. Attorneys-in-fact, executors, administrators, trustees,
guardians, corporation officers or others acting in representative capacity
should indicate the capacity in which they sign and should give FULL title, and
submit appropriate evidence of authority to execute the Consent)
Dated: _________________, 1999
(Important - please fill in)
-----------------------------------
Signature
-----------------------------------
Signature
-----------------------------------
Telephone Number
PLEASE MARK, SIGN, DATE & PROMPTLY RETURN THIS CONSENT BY OCT. 15, 1999.
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<PAGE>
THIS CONSENT IS SOLICITED BY BOND G.P., L.L.C. LIMITED PARTNERS WHO RETURN A
SIGNED CONSENT BUT FAIL TO INDICATE THEIR APPROVAL OR DISAPPROVAL AS TO ANY
MATTER WILL BE DEEMED TO HAVE VOTED TO APPROVE SUCH MATTER. THIS CONSENT IS
VALID FROM THE DATE OF ITS EXECUTION UNLESS DULY REVOKED.
NOONEY INCOME FUND LTD. II, L.P.
a Missouri Limited Partnership (the "Partnership")
CONSENT OF LIMITED PARTNER
Deliveries of Consents, properly completed and duly executed, should be made
to Bond G.P. at the address set forth below. A prepaid, return envelope is
included herewith.
Questions and requests for assistance about procedures for consenting or
other matters relating to this Solicitation may be directed to Bond G.P. at the
address and telephone number listed below. Additional copies of this Consent
Solicitation Statement and form of Consent may be obtained from Bond G.P. as set
forth below.
Bond G.P., L.L.C.
1100 Main - Suite 2100
Kansas City, Missouri 64105
(816) 421-4670
21
