SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 13E-4
ISSUER TENDER OFFER STATEMENT
(Pursuant to Section 13(e)(1) of the Securities Exchange Act of 1934)
NTS-PROPERTIES VI
(Name of Issuer)
NTS-PROPERTIES VI
and
ORIG, LLC
(Name of Persons Filing Statement)
LIMITED PARTNERSHIP INTERESTS
(Title of Class of Securities)
62942E407
(CUSIP Number of Class of Securities)
J.D. Nichols, Managing General Partner
NTS-Properties Associates VI
10172 Linn Station Road
Louisville, Kentucky 40223
(502) 426-4800
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications on Behalf of Person Filing Statement)
Copy to:
Michael J. Choate, Esq.
Shefsky & Froelich Ltd.
444 North Michigan Avenue, Suite 2500
Chicago, Illinois 60611
(312) 836-4066
October 20, 1998
(Date Tender Offer First Published, Sent or Given to Security Holders)
CALCULATION OF FILING FEE
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| Transaction Valuation: $437,500 (a) | Amount of Filing Fee |
| Limited Partnership Interest at $350 per Interest | $87.50(b) |
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(a) Calculated as the aggregate maximum purchase price for limited
partnership interests.
(b) Calculated as 1/50th of 1% of the Transaction Value.
o 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
of Schedule and the date of its filing.
Amount Previously Paid: ___________________________ Not Applicable
Form of Registration No.: __________________________ Not Applicable
Filing Party: _____________________________________ Not Applicable
Date Filed: _______________________________________ Not Applicable
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<PAGE>
Item 1. Security and Issuer.
- -----------------------------
(a) The name of the issuer is NTS-Properties VI, a Maryland limited
partnership (the "Partnership"). The Partnership's principal executive offices
are located at 10172 Linn Station Road, Louisville, Kentucky 40223.
(b) The title of the securities that are subject to the Offer to
Purchase dated October 20, 1998 (the "Offer") is limited partnership interests
or portions thereof in the Partnership. (As used herein, the term "Interest" or
"Interests", as the context requires, shall refer to the limited partnership
interests in the Partnership and portions thereof that constitute the class of
equity security that is the subject of this tender offer or the limited
partnership interests or portions thereof that are tendered by the limited
partners of the Partnership ("Limited Partners") to the Offerors pursuant to the
Offer to Purchase.) This Offer is being made to all Limited Partners. As of
September 30, 1998, the Partnership had 40,589 outstanding Interests held by
3,799 holders of record. Subject to the conditions set forth in the Offer, the
Partnership and ORIG, LLC, a Kentucky limited liability company and an affiliate
of the Partnership (the "Affiliate" and, collectively with the Partnership, the
"Offerors"), will purchase in the aggregate up to 1,250 Interests. The purchase
price of the Interests tendered to the Offerors will be equal to $350 per
Interest, net to the tendering Limited Partners in cash (the "Purchase Price").
Although the Offer is being made to all Limited Partners, the Partnership has
been advised that neither the general partner, NTS-Properties Associates VI
("General Partner"), the Affiliate, nor any of their partners, members,
affiliates or associates intend to tender any Interests pursuant to the Offer.
Reference is hereby made to the Introduction of the Offer, which is
incorporated herein by reference.
(c) There is currently no established trading market for the Interests,
and any transfer of Interests is limited by the terms of the Partnership's
Amended and Restated Agreement of Limited Partnership as amended on January 1,
1987 ("Partnership Agreement").
Reference is hereby made to Section 7, "Cash Distribution Policy," of
the Offer which is incorporated herein by reference.
(d) In addition to the Partnership, ORIG, LLC, an affiliate of the
Partnership, is jointly filing this statement as a co-offeror. ORIG, LLC is
located at 10172 Linn Station Road, Louisville, Kentucky. The members of ORIG,
LLC are substantially the same as the partners of the General Partner.
Item 2. Source and Amount of Funds or Other Consideration.
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(a) The total amount of funds required to complete the Offer is
approximately $499,500 (including $437,500 to purchase 1,250 Interests plus
approximately $62,000 for expenses associated with administering the Offer, such
as legal, accounting, printing and mailing expenses and transfer
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fees). The Partnership will purchase the first 750 Interests tendered pursuant
to the Offer and will fund its purchases and its portion of the expenses of the
Offer from its cash reserves. If the Offer is oversubscribed and the
Partnership, in its sole discretion, decides to purchase Interests in excess of
750 Interests, the Partnership will fund these additional purchases and
expenses, if any, from its cash reserves.
The Affiliate will purchase the next 500 Interests tendered and will
fund its purchases and its portion of the expenses of the Offer from cash
contributions to be made to the Affiliate by its members. If the Offer is
oversubscribed and the Affiliate, in its sole discretion, decides to purchase
Interests in excess of 500 Interests, the Affiliate will fund these additional
purchases and expenses, if any, from these cash contributions.
Reference is hereby made to Section 9, "Source and Amount of Funds," of
the Offer, which is incorporated herein by reference.
(b) Neither the Partnership nor the Affiliate intends to borrow funds
to purchase any Interests tendered pursuant to this Offer.
Reference is hereby made to Section 9, "Source and Amount of Funds," of
the Offer which is incorporated herein by reference.
Item 3. Purpose of the Tender Offer and Plans or Proposals of Issuer or the
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Affiliate.
- ----------
The purpose of the Offer is to provide Limited Partners who desire to
liquidate their investment in the Partnership with a method for doing so. With
the exception of isolated transactions, no established secondary trading market
for the Interests exists and transfers of Interests are subject to certain
restrictions as set forth in the Partnership Agreement, including prior approval
of the General Partner. Interests that are tendered to the Partnership will be
retired, although the Partnership may issue interests from time to time in
compliance with the registration requirements of federal and state securities
laws or any exemptions therefrom. Interests that are tendered to the Affiliate
will be held by the Affiliate. Neither the Partnership nor the General Partner
has plans to offer for sale any other additional interests, but each reserves
the right to do so in the future.
The Offer is generally not conditioned upon any minimum number of
Interests being tendered. The Offer is conditioned upon, among other things, the
absence of certain adverse conditions described in Section 6, "Certain
Conditions of the Offer." In particular, the Offer will not be consummated, if
in the opinion of the General Partner, there is a reasonable likelihood that
purchases under the Offer would result in termination of the Partnership (as a
partnership) under Section 708 of the Internal Revenue Code of 1986, as amended
(the "Code"), or termination of the Partnership's status as a partnership for
federal income tax purposes under Section 7704 of the Code. Further, the
Offerors will not purchase Interests, if the purchase of Interests would result
in the Interests being owned by fewer than three hundred (300) holders of
record.
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(a) The Offerors have agreed that the Partnership will purchase the
first 750 Interests tendered during the Offer, and that, if more than 750
Interests are tendered, the Affiliate will purchase up to an additional 500
Interests tendered on the same terms and conditions as those Interests purchased
by the Partnership. If, on the Expiration Date (defined below), the Offerors
determine that more than 1,250 Interests have been tendered during the Offer,
each Offeror may: (i) accept the additional Interests permitted to be accepted
pursuant to Rule 13e-4(f)(1) promulgated under the Securities Exchange Act of
1934, as amended; or (ii) extend the Offer, if necessary, and increase the
amount of Interests that the Offeror is offering to purchase to an amount that
the Offeror believes to be sufficient to accommodate the excess Interests
tendered as well as any Interests tendered during the extended Offer. If the
Offer is oversubscribed, and the Offerors do not act in accordance with (i) or
(ii) above, or the Offerors act in accordance with (i) and (ii), above, but the
Offer remains oversubscribed, then the Offerors will accept Interests tendered
prior to or on the Expiration Date (defined below) for payment on a pro rata
basis. In the event of proration, the number of Interests purchased from a
Limited Partner will be equal to a fraction of the Interests tendered, the
numerator of which will be the total number of Interests the Offerors are
willing to purchase and the denominator of which will be the total number of
Interests properly tendered. Notwithstanding the foregoing, the Offerors will
not purchase Interests tendered by a Limited Partner if, as a result of the
purchase, the Limited Partner would continue to be a Limited Partner and would
hold fewer than five (5) Interests.
The term "Expiration Date" shall mean 12:00 Midnight, Eastern Standard
Time, on January 18, 1999, unless and until the Offerors extend the period of
time for which the Offer is open, in which event "Expiration Date" will mean the
latest time and date at which the Offer, as extended by the Offerors or the
Affiliate, expires. The Partnership may extend the Offer in its sole discretion
by providing the Limited Partners with written notice of the extension;
provided, however, that if the Offer is oversubscribed, the Partnership or the
Affiliate may, each in its sole discretion, extend the Offer by providing the
Limited Partners with written notice of the extension.
(b) Neither the Offerors nor the General Partner has any plans or
proposals that relate to or would result in an extraordinary corporate
transaction, such as a merger, reorganization or liquidation, involving the
Partnership.
(c) Neither the Offerors nor the General Partner has any plans or
proposals that relate to or would result in a sale or transfer of a material
amount of assets of the Partnership.
(d) Neither the Offerors nor the General Partner has any plans or
proposals that relate to or would result in any change in the identity of the
General Partner or in the management of the Partnership, including, but not
limited to, any plans or proposals to change the number or term of the General
Partner(s), to fill any existing vacancy for the General Partner, or to change
any material term of the management agreement between the General Partner and
the Partnership.
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(e) Neither the Offerors nor the General Partner has any plans or
proposals that relate to or would result in any material change in the present
distribution policy or indebtedness or capitalization of the Partnership.
(f) Neither the Offerors nor the General Partner has any plans or
proposals that relate to or would result in any other material change in the
Partnership's structure or business.
(g) Neither the Offerors nor the General Partner has any plans or
proposals that relate to or would result in any change in the Partnership
Agreement or other actions that may impede the acquisition of control of the
Partnership by any person.
Items (h) through (j) of this Item 3 are not applicable to the
Partnership because the Offer is conditioned on the Partnership having no fewer
than three hundred (300) holders of record after completion of the Offer.
Reference is hereby made to the Introduction, Section 1, "Background
and Purposes of the Offer," Section 5, "Purchase of Interests; Payment of
Purchase Price," Section 6, "Certain Conditions of the Offer," and Section 10,
"Certain Information About the Partnership" of the Offer, which are incorporated
herein by reference.
Item 4. Interest in Securities of the Issuer.
- ----------------------------------------------
There have not been any transactions involving Interests that were
effected during the past forty (40) business days by the Partnership, the
General Partner, the Affiliate or any person controlling the Partnership, the
General Partner or the Affiliate, except as set forth below:
On August 21, 1998, the Partnership repurchased 202 interests at a
price equal to $350 per Interest pursuant to the Partnership's Interest
Repurchase Program.
On September 10, 1998, the Partnership repurchased 113 interests at a
price equal to $350 per interest pursuant to the Partnership's Interest
Repurchase Program.
On September 28, 1998, the Partnership repurchased 283 interests at a
price equal to $350 per interest pursuant to the Partnership's Interest
Repurchase Program.
Reference is hereby made to Section 12, "Transactions and Arrangements
Concerning Interests" of the Offer, which is incorporated herein by reference.
Item 5. Contracts, Arrangements, Understandings or Relationships with Respect
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to the Issuer's Securities.
- ---------------------------
The Partnership Agreement, contained in the Partnership's prospectus
dated June 25, 1985, grants the General Partner discretion to decide whether the
Partnership or any of its affiliates will
5
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purchase Interests from time to time from Limited Partners on certain terms and
conditions described in the Partnership Agreement. The Partnership, however,
will not purchase Interests if, as a result, the Limited Partner would continue
to be a Limited Partner and would hold fewer than five (5) Interests.
The Offerors are not aware of any other contract, arrangement,
understanding or relationship relating, directly or indirectly, to this Offer
(whether or not legally enforceable) between or among (i) the Partnership, the
General Partner or the Affiliate or (ii) any person controlling the Partnership,
the General Partner or the Affiliate or any other person.
Reference is hereby made to the Introduction, Section 1, "Background
and Purposes of the Offer," and Section 12, "Transactions and Arrangements
Concerning Interests" of the Offer, which are incorporated herein by reference.
Item 6. Persons Retained, Employed or to be Compensated.
- ---------------------------------------------------------
No persons have been employed, retained or are to be compensated by the
Offerors to make solicitations or recommendations in connection with the Offer.
Item 7. Financial Information.
- -------------------------------
(a) Reference is hereby made to the audited financial statements of the
Partnership for the years ended December 31, 1996 and December 31, 1997, filed
with the Securities and Exchange Commission ("Commission") on Form 10-K on March
31, 1997 and March 30, 1998, respectively, which are incorporated herein by
reference. Also, reference is hereby made to the unaudited financial statements
of the Partnership for the three and six-month periods ended June 30, 1998,
filed with the Commission on Form 10-Q on August 14, 1998, which are
incorporated herein by reference.
(b) Reference is hereby made to the financial statements giving the
effect of the Offer on a pro forma basis attached as Appendix A of Exhibit
(a)(1) hereto, which are incorporated herein by reference.
Item 8. Additional Information.
- --------------------------------
(a) Reference is hereby made to Section 10, "Certain Information About
the Partnership" and Section 12, "Transactions and Arrangements Concerning
Interests" of the Offer, which are incorporated herein by reference.
(b) None.
(c) Not applicable.
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(d) None.
(e) Reference is hereby made to the Offer, the Letter of Transmittal
and related documents, forms of which are attached hereto as Exhibits (a)(1) -
(a)(5), and are incorporated herein by reference.
Item 9. Material to be Filed as Exhibits.
- ------------------------------------------
(a)(1) Form of Offer to Purchase dated October 20, 1998 (including
financial statements giving pro forma effect of the Offer).
(a)(2) Form of Letter of Transmittal.
(a)(3) Form of Affidavit and Indemnification Agreement for Missing
Certificate(s) of Ownership.
(a)(4) Form of Letter to Limited Partners.
(a)(5) Substitute Form W-9 with Guidelines.
(b) Not applicable.
(c) Reference is hereby made to: (1) the Amended and Restated
Agreement of Limited Partnership of NTS-Properties VI,
previously filed with the Securities and Exchange Commission
as part of the Partnership's Registration Statement on
Form S-11, No. 2-96583, filed with the Commission on March 22,
1985, and declared effective on June 25, 1985, and (2) the
First Amendment to the Amended and Restated Agreement
of Limited Partnership NTS-Properties VI, previously filed
with the Commission as part of the Partnership's Annual Report
on Form 10-K for the fiscal year ended December 31, 1987,
Commission File No. 0-14695.
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
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SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Date: October 20, 1998 NTS-PROPERTIES VI, a Maryland limited
partnership
By: NTS - PROPERTIES ASSOCIATES VI,
General Partner
By: /s/ J.D. Nichols
--------------------------------
J.D. Nichols,
Managing General Partner
ORIG, LLC,
a Kentucky limited liability company
By: /s/ Richard L. Good
--------------------------
Richard L. Good,
Managing Member
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EXHIBITS
Exhibit
Number Description
- ------ -----------
(a)(1) Form of Offer to Purchase, dated October 20, 1998
(including financial statements giving pro forma effect of
the Offer).
*(a)(2) Form of Letter of Transmittal.*
(a)(3) Form of Affidavit and Indemnification Agreement for
Missing Certificate(s) of Ownership.*
(a)(4) Form of Letter to Limited Partners.
*(a)(5) Substitute Form W-9 with Guidelines.*
(b) Not applicable.
(c) Reference is hereby made to: (1) the Amended and
Restated Agreement of Limited Partnership of NTS-Properties
VI, previously filed with the Securities and Exchange
Commission as part of the Partnership's Registration
Statement on Form S-11, No. 2-96583, filed with the
Commission on March 22, 1985, and declared effective on June
25, 1985, and (2) the First Amendment to the Amended and
Restated Agreement of Limited Partnership NTS-Properties VI,
previously filed with the Commission as part of the
Partnership's Annual Report on Form 10-K for the fiscal year
ended December 31, 1987, Commission File No. 0-14695.
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
* Filed herein.
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EXHIBIT (a)(1)
Form of Offer to Purchase, dated October 20, 1998
10
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Offer to Purchase for Cash
by
NTS-Properties VI
and
ORIG, LLC
of Up to
1,250 Limited Partnership Interests
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00
MIDNIGHT, EASTERN STANDARD TIME, ON MONDAY, JANUARY 18, 1999, UNLESS EXTENDED.
NTS-Properties VI is a Maryland limited partnership (the "Partnership")
that owns, or owns joint venture interests in, certain residential rental and
commercial real estate properties. See Section 10, "Certain Information About
the Partnership." Except as otherwise provided in the Partnership Agreement
(defined below), the Partnership's general partner, NTS-Properties Associates VI
(the "General Partner"), owns a one percent (1%) interest in the Partnership and
the limited partners, in the aggregate, own a ninety-nine percent (99%) interest
in the Partnership. The Partnership and ORIG, LLC, a Kentucky limited liability
company (the "Affiliate"), an affiliate of the Partnership (the Affiliate and
the Partnership are each an "Offeror" and collectively, the "Offerors"), are
offering to purchase for cash upon the terms and conditions set forth in this
Offer to Purchase ("Offer to Purchase") and the related Letter of Transmittal
("Letter of Transmittal," which together with the Offer to Purchase constitutes
the "Offer") in the aggregate up to 1,250 of the Partnership's limited
partnership interests (the "Interests") at a price equal to $350 per Interest
(the "Purchase Price"). This Offer is being made to all limited partners of the
Partnership ("Limited Partners") and is generally not conditioned upon any
minimum amount of Interests being tendered, but is subject to certain conditions
described herein.
Limited Partners tendering all or any portion of their Interests are
subject to certain risks including:
o The Purchase Price of $350 per Interest may not equate to the
fair market value or the liquidation value of the Interest,
and is less than the book value per Interest.
o Neither the General Partner, on behalf of the Partnership, nor
the Affiliate has retained an independent third party to
evaluate the fairness of the Offer.
o Conflicts in establishing the Purchase Price exist between
tendering Limited Partners and the Partnership, the General
Partner and non-tendering Limited Partners.
o Negative tax consequences may exist for any Limited Partner
tendering its Interests.
o The General Partner makes no recommendation regarding whether
Limited Partners should tender or retain their Interests.
Limited Partners continuing to hold all or any portion of their
Interests are subject to certain risks including:
o Future cash distributions to Limited Partners may be reduced
or eliminated as a result of the Offer.
o The percentage ownership of Interests held by persons
controlling, controlled by or under common control with the
General Partner or its affiliates will increase as a result of
the Offer.
o The Partnership has no current plans to liquidate its assets
and to distribute the proceeds to its Limited Partners.
o General economic risks are associated with investments in real
estate.
o The Partnership's financial condition may be adversely
affected by a downturn in the business of any tenant occupying
a significant portion of a Partnership property or a tenant's
decision not to renew its lease.
See "RISK FACTORS."
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<PAGE>
THE OFFER IS NOT CONDITIONED UPON ANY MINIMUM NUMBER OF INTERESTS BEING
TENDERED; PROVIDED, HOWEVER, NO TENDER WILL BE ACCEPTED FROM A LIMITED PARTNER
IF, AS A RESULT OF THE TENDER, THE LIMITED PARTNER WOULD CONTINUE TO BE A
LIMITED PARTNER AND WOULD HOLD FEWER THAN FIVE (5) INTERESTS. THE OFFER IS
CONDITIONED UPON, AMONG OTHER THINGS, THE ABSENCE OF CERTAIN CONDITIONS
DESCRIBED IN SECTION 6, "CERTAIN CONDITIONS OF THE OFFER."
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IMPORTANT
Any Limited Partner wishing to tender all or any portion of his, her or
its Interests should complete and sign the enclosed Letter of Transmittal in
accordance with the instructions in the Offer to Purchase and Letter of
Transmittal and deliver it together with the Certificate(s) of Ownership for the
Interests being tendered (or if the Certificate(s) of Ownership for the
Interests is (are) lost, stolen, misplaced or destroyed, the Affidavit and
Indemnification Agreement for Missing Certificate(s) of Ownership executed by
the Limited Partner attesting to such fact), the Substitute Form W-9 and any
other required documents to the Partnership. A Limited Partner having Interests
registered in the name of a broker, dealer, commercial bank, trust company or
other nominee must contact that broker, dealer, commercial bank, trust company
or other nominee if he, she or it desires to tender such Interests.
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Questions and requests for assistance or for additional copies of this
Offer to Purchase, the Letter of Transmittal or any other documents relating to
this Offer may be directed to NTS Investor Services c/o Gemisys at (800)
387-7454.
The date of this Offer to Purchase is October 20, 1998
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NEITHER THE OFFERORS NOR THE PARTNERSHIP'S GENERAL PARTNER MAKE ANY
RECOMMENDATION TO ANY LIMITED PARTNER REGARDING WHETHER TO TENDER OR REFRAIN
FROM TENDERING INTERESTS. EACH LIMITED PARTNER MUST MAKE HIS, HER OR ITS OWN
DECISION REGARDING WHETHER TO TENDER INTERESTS, AND, IF SO, THE PORTION OF SUCH
LIMITED PARTNER'S INTERESTS TO TENDER.
NO PERSON HAS BEEN AUTHORIZED TO MAKE ANY RECOMMENDATION ON BEHALF OF
THE OFFERORS REGARDING WHETHER LIMITED PARTNERS SHOULD TENDER OR REFRAIN FROM
TENDERING INTERESTS PURSUANT TO THE OFFER. NO PERSON HAS BEEN AUTHORIZED TO GIVE
ANY INFORMATION OR TO MAKE ANY REPRESENTATION IN CONNECTION WITH THE OFFER OTHER
THAN THOSE CONTAINED HEREIN OR IN THE LETTER OF TRANSMITTAL. ANY RECOMMENDATION
OR INFORMATION, IF GIVEN OR MADE, MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE OFFERORS OR THE GENERAL PARTNER.
THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE FAIRNESS OR MERITS OF SUCH
TRANSACTION OR UPON THE ACCURACY OR ADEQUACY OF THE INFORMATION CONTAINED IN
THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
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TABLE OF CONTENTS
INTRODUCTION...................................................................5
SUMMARY OF CERTAIN INFORMATION.................................................8
RISK FACTORS...................................................................9
THE OFFER.....................................................................12
Section 1. Background and Purposes of the Offer........................12
Section 2. Offer to Purchase and Purchase Price; Proration; Expiration
Date; Determination of Purchase Price.......................13
Section 3. Procedure for Tendering Interests...........................14
Section 4. Withdrawal Rights...........................................16
Section 5. Purchase of Interests; Payment of Purchase Price............16
Section 6. Certain Conditions of the Offer.............................16
Section 7. Cash Distribution Policy....................................19
Section 8. Effects of the Offer........................................19
Section 9. Source and Amount of Funds..................................19
Section 10. Certain Information About the Partnership...................20
Section 11. Certain Federal Income Tax Consequences.....................21
Section 12. Transactions and Arrangements Concerning Interests..........24
Section 13. Extensions of Tender Period; Terminations; Amendments.......25
Section 14. Fees and Expenses...........................................25
Section 15. Address; Miscellaneous......................................26
Appendix A The Partnership's Financial Statements Giving Pro Forma Effect
of the Offer................................................28
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To Holders of Limited Partnership Interests of
NTS-Properties VI
INTRODUCTION
NTS-Properties VI is a Maryland limited partnership (the "Partnership")
that owns, or owns joint venture interests in, certain residential rental and
commercial real estate properties. See Section 10, "Certain Information About
the Partnership." Except as otherwise provided in the Partnership Agreement
(defined below), the Partnership's general partner, NTS-Properties Associates VI
(the "General Partner") owns a one percent (1%) interest in the Partnership and
the limited partners own, in the aggregate, a ninety-nine percent (99%) interest
in the Partnership. The Partnership and ORIG, LLC, a Kentucky limited liability
company (the "Affiliate"), an affiliate of the Partnership (the Partnership and
the Affiliate are each an "Offeror" and, collectively, the "Offerors"), hereby
offer to purchase up to 1,250 of the Partnership's limited partnership interests
(the "Interests") at a purchase price of $350 per Interest (the "Purchase
Price") in cash to the seller upon the terms and subject to the conditions set
forth in this "Offer to Purchase" and in the related "Letter of Transmittal"
(together the "Offer to Purchase" and "Letters of Transmittal" constitute the
"Offer"). (As used herein, the term "Interest" or "Interests," as the context
requires, refers to the limited partnership interests in the Partnership and
portions thereof that constitute the class of equity security that is the
subject of this Offer or the limited partnership interests or portions thereof
that are tendered by the limited partner to the Offerors pursuant to the Offer.)
The Partnership, in its sole discretion, may purchase more than 750 Interests,
and the Affiliate, in its sole discretion, may purchase more than 500 Interests,
but neither has any current intention to do so. This Offer is being made to all
limited partners in the Partnership ("Limited Partners") and is generally not
conditioned upon any minimum amount of Interests being tendered, except as
described herein. The Interests are not traded on any established trading market
and are subject to certain restrictions on transferability set forth in the
Amended and Restated Agreement of Limited Partnership of NTS-Properties VI, as
amended on January 1, 1987 (the "Partnership Agreement").
The Purchase Price should not be viewed as equivalent to the fair
market value or the liquidation value of an Interest and is less than the book
value per Interest. As of June 30, 1998 and December 31, 1997, the book value of
each Interest was approximately $371.32 and $371.12, respectively. The Purchase
Price offered by the Offerors has been determined by the Partnership, in its
sole discretion, based on: (i) recent sales of Interests by Limited Partners to
third parties in secondary market transactions; (ii) recent repurchases of
interests by the Partnership; and (iii) recent purchases of Interests by the
Partnership's affiliate, Ocean Ridge Investments Ltd., a Florida limited
liability partnership ("Ocean Ridge"). Neither the Offerors nor the General
Partner has obtained an opinion from an independent third party regarding the
fairness of the Purchase Price.
Subject to the conditions set forth in the Offer, the Partnership will
purchase the first 750 Interests which are tendered and received by the
Partnership by, and not withdrawn prior to, 12:00 Midnight, Eastern Standard
Time, on Monday, January 18, 1999, subject to any extension of the Offer by the
Offerors (the "Expiration Date"). If more than 750 Interests are tendered, the
Affiliate will purchase up to an additional 500 Interests which are tendered and
received by the Partnership
5
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by, and not withdrawn prior to the Expiration Date. If, on the Expiration Date,
the Offerors determine that more than 1,250 Interests have been tendered during
the Offer, each Offeror may: (i) accept the additional Interests permitted to be
accepted pursuant to Rule 13e-4(f)(1) promulgated under the Securities Exchange
Act of 1934 ("Exchange Act"), as amended; or (ii) extend the Offer, if
necessary, and increase the amount of Interests that the Offeror is offering to
purchase to an amount that the Offeror believes to be sufficient to accommodate
the excess Interests tendered as well as any Interests tendered during the
extended Offer.
If the Offer is oversubscribed and the Offerors do not act in
accordance with (i) or (ii), above, or if the Offerors act in accordance with
(i) and (ii), above, but the Offer remains oversubscribed, then the Offerors
will accept Interests tendered prior to or on the Expiration Date for payment on
a pro rata basis ("Proration"). In the event of Proration, the number of
Interests purchased from a Limited Partner will be equal to a fraction of the
Interests tendered, the numerator of which will be the total number of Interests
the Offerors are willing to purchase and the denominator of which will be the
total number of Interests properly tendered. Any fractional interests resulting
from this calculation will be rounded down to the nearest whole number.
Fractions of Interests will not be purchased. The Partnership will notify, in
writing, all Limited Partners from whom the Offerors will purchase fewer than
the number of Interests tendered by the Limited Partner. For any Interest
tendered but not purchased by the Offerors, a book entry will be made on the
Partnership's books to reflect the Limited Partner's ownership of the Interests
not purchased. The Partnership will not issue a new Certificate of Ownership for
the Interests not purchased by the Offerors, except upon written request of the
Limited Partner.
The Offer is generally not conditioned upon any minimum number of
Interests being tendered. The Offer, however, is conditioned upon, among other
things, the absence of certain adverse conditions described in Section 6,
"Certain Conditions of the Offer." In particular, the Offer will not be
consummated, if in the opinion of the General Partner, there is a reasonable
likelihood that purchases under the Offer would result in termination of the
Partnership (as a partnership) under Section 708 of the Internal Revenue Code of
1986, as amended (the "Code"), or termination of the Partnership's status as a
partnership for federal income tax purposes under Section 7704 of the Code.
Further, the Offerors will not purchase Interests if the purchase of Interests
would result in Interests being owned by fewer than three hundred (300) holders
of record. See Section 6, "Certain Conditions of the Offer."
All purchases of Interests pursuant to the Offer will be effective as
of the Expiration Date. Each Limited Partner who tenders Interests pursuant to
the Offer will receive the Purchase Price and cash distributions declared prior
to the Expiration Date, if any. Limited Partners will not be entitled to receive
cash distributions declared and payable after the Expiration Date, if any, on
any Interests tendered and accepted by the Offerors.
The tender of an Interest will be treated as a sale of the Interest for
federal and most state income tax purposes which will result in the Limited
Partner recognizing gain or loss for income tax purposes. Limited Partners are
urged to review carefully all the information contained in or referred to in
this Offer including, without limitation, the information presented herein in
Section 11, "Certain Federal Income Tax Consequences."
6
<PAGE>
As of September 30, 1998, the General Partner owned five (5) of the
Partnership's outstanding Interests and the Affiliate did not own any of the
Partnership's outstanding Interests. All partners, members, affiliates and
associates of the General Partner or the Affiliate beneficially owned, an
aggregate of 448 Interests, representing approximately 1.1% of the Partnership's
40,589 outstanding Interests. Although the Offer is being made to all Limited
Partners, the Partnership has been advised that neither the General Partner nor
any of the partners, members, affiliates or associates of the General Partner or
the Affiliate intend to tender any Interests pursuant to the Offer. Assuming the
Offer is fully subscribed, the General Partner, the Affiliate, and partners,
members, affiliates and associates of the General Partner or the Affiliate, will
own, after the Offer, an aggregate of 948 interests representing approximately
2.4% of the Partnership's outstanding Interests.
7
<PAGE>
SUMMARY OF CERTAIN INFORMATION
The following is a summary of certain information contained elsewhere
in this Offer. The summary does not purport to be complete and is qualified in
its entirety by reference to the more detailed information contained elsewhere
in this Offer and related documents. Capitalized terms used but not defined in
this summary are defined elsewhere in this Offer. Limited Partners are urged to
read all documents constituting this Offer in their entirety.
Offerors The Partnership, a Maryland limited
partnership, and the Affiliate, a
Kentucky limited liability company,
invite all of the Partnership's
Limited Partners to tender their
Interests upon the terms and subject
to the conditions set forth in this
Offer.
Purchase Price $350 per Interest in cash.
Expiration Date The Offer expires on Monday, January
18, 1999 at 12:00 Midnight, Eastern
Standard Time unless the Offer is
otherwise extended by the Offerors
in accordance with the provisions
set forth herein. ALL INTERESTS
BEING TENDERED MUST BE RECEIVED BY
THE PARTNERSHIP AT THE ADDRESS SET
FORTH IN SECTION 15, "ADDRESS;
MISCELLANEOUS," ON OR BEFORE THE
EXPIRATION DATE.
Offer Conditions The Offerors will purchase in the
aggregate up to 1,250 Interests. The
first 750 Interests tendered will be
purchased by the Partnership; up to
an additional 500 Interests tendered
will be purchased by the Affiliate.
If the Offer is oversubscribed,
first the Partnership may purchase
additional Interests, and then the
Affiliate may purchase additional
Interests, each in its sole
discretion. If the Offer remains
oversubscribed, Interests will be
purchased on a pro rata basis.
This Offer is being made to all
Limited Partners and is not
conditioned upon a minimum amount of
Interests being tendered; provided
however, no tender will be accepted
from a Limited Partner if, as a
result of the tender, the Limited
Partner would continue to be a
Limited Partner and would hold fewer
than five (5) Interests. The Offer
is subject to certain terms and
conditions set forth in the Offer.
8
<PAGE>
RISK FACTORS
------------
Limited Partners Tendering All or Any Portion of Their Interests Are
---------------------------------------------------------------------
Subject to Certain Risks:
- -------------------------
Purchase Price May Be Less Than Fair Market Value and Liquidation
----------------------------------------------------------------------
Value and Is Less Than Book Value. The Interests are not traded on a recognized
- ----------------------------------
stock exchange or trading market and a readily identifiable, liquid market for
the Interests does not exist. The Offerors are aware of certain secondary market
transactions by which Interests were transferred at prices ranging from $269 to
$313.26 per Interest (these prices include commissions and other mark-ups) by
Limited Partners to third parties during the period from January 1, 1997 to
April 30, 1998. Additionally, the Partnership has repurchased 6,846 interests,
and its affiliates, Ocean Ridge and B.K.K. Financial, Inc., an Indiana
corporation ("BKK"), have purchased 413 Interests during the period from October
1, 1995 to September 30, 1998 at prices ranging from $234 to $350 per Interest.
As of June 30, 1998 and December 31, 1997, the book value of each Interest was
approximately $371.32 and $371.12, respectively. Neither these secondary market
transactions nor the Purchase Price necessarily reflects the value that Limited
Partners would realize from holding the Interests until termination or
liquidation of the Partnership, which could result in greater or lesser value.
The Offerors have not obtained an opinion from an independent third party
regarding the fairness of the Purchase Price. Furthermore, the Offerors did not
obtain an appraisal of the Partnership's assets in establishing the Purchase
Price.
Negative Tax Consequences May Exist for Any Limited Partner Tendering
-----------------------------------------------------------------------
Interests. Limited Partners tendering and selling Interests pursuant to this
- ----------
Offer generally will recognize a gain or loss on the tender of his, her or its
Interests for federal and most state income tax purposes. The amount of gain or
loss realized will be, in general, the excess of the Purchase Price minus the
Limited Partner's adjusted tax basis in the Interests sold. Generally, the sale
of Interests held by a Limited Partner for more than twelve (12) months will
result in long-term capital gain or loss. Due to the complexity of tax issues,
Limited Partners are advised to consult their tax advisors with respect to their
individual tax situations before tendering their Interests pursuant to the
Offer. See Section 11, "Certain Federal Income Tax Consequences."
Conflict of Interest. A conflict of interest exists between Limited
---------------------
Partners who are tendering their Interests and the Partnership, the General
Partner and non-tendering Limited Partners. Tendering Limited Partners would
prefer a higher Purchase Price; the Partnership, the General Partner and
non-tendering Limited Partners would prefer a lower Purchase Price.
General Partner Makes No Recommendation to Limited Partners. The
------------------------------------------------------------------
General Partner makes no recommendation regarding whether Limited Partners
should tender or retain their Interests. Limited Partners should make their own
decisions regarding whether to tender their Interests based upon their own
individual situation.
9
<PAGE>
Limited Partners Who Do Not Tender All or Any Portion of Their
-----------------------------------------------------------------------
Interests Are Subject to Certain Risks:
- ---------------------------------------
Cash Distributions May Be Reduced or Eliminated. The amount of funds
--------------------------------------------------
required by the Partnership to fund the Offer is estimated to be approximately
$299,700 ($262,500 to purchase 750 Interests plus approximately $37,200 for its
proportionate share of the expenses associated with administering the Offer; the
expenses of the Offer will be apportioned between the Offerors based on the
number of Interests purchased by each Offeror). The Partnership intends to fund
these monies from its cash reserves. The use of the Partnership's cash reserves
to fund the Offer will have the effect of: (i) reducing the existing cash
available for future needs or contingencies and (ii) reducing or eliminating the
interest income that the Partnership earns on its cash reserves. There can be no
assurance that the Partnership will be able to fund its future needs or
contingencies, which may have a material adverse effect on the Partnership's
business or financial condition.
Increased Voting Control by Affiliates of the Partnership. If the Offer
----------------------------------------------------------
is fully subscribed, the percentage ownership of Interests held by persons
controlling, controlled by or under common control with the Partnership will
increase. As of September 30, 1998, the General Partner owned five (5) of the
Partnership's outstanding Interests. The General Partner and all partners,
members, affiliates and associates of the General Partner or the Affiliate
beneficially owned, in the aggregate, 448 Interests, representing approximately
1.1% of the Partnership's 40,589 outstanding Interests. Although this Offer is
made to all Limited Partners, the Partnership has been advised that neither the
General Partner nor any of the partners, members, affiliates or associates of
the General Partner or the Affiliate intend to tender any Interests pursuant to
the Offer. Assuming the Offer is fully subscribed, the General Partner, the
Affiliate, and partners, members, affiliates and associates of the General
Partner or the Affiliate, will own, after the Offer, an aggregate of 948
Interests representing approximately 2.4% of the Partnership's 39,839
outstanding Interests, an increase of 1.3%. In addition, other persons
controlling, controlled by or under common control with the Partnership, by
virtue of the decreased number of outstanding Interests, will have a greater
percentage of the outstanding Interests. The increase in ownership of Interests
will enable these entities or individuals to have a greater influence on certain
matters voted on by Limited Partners, including removal of the General Partner
and termination of the Partnership.
Partnership Has No Current Plans to Liquidate. The Partnership has no
-----------------------------------------------
current plan to liquidate its assets and to distribute the proceeds to its
Limited Partners nor does the Partnership contemplate resuming distributions to
the Limited Partners. Therefore, Limited Partners who do not tender their
Interests may not be able to realize any return on or of their investment in the
foreseeable future.
Reliance on Certain Tenants. The Partnership's financial condition and
----------------------------
ability to fund future cash needs including its ability to make future cash
distributions, if any, may be adversely affected by the bankruptcy, insolvency
or a downturn in business of any tenant occupying a significant portion of any
Partnership property or by a tenant's decision not to renew its lease. Failure
to re-lease the space vacated by significant tenants on a timely basis and on
terms and conditions acceptable to the Partnership could have a material adverse
effect on the Partnership's results of operation and financial condition.
10
<PAGE>
General Economic Risks Associated with Investments in Real Estate. All
------------------------------------------------------------------
real property investments are subject to some degree of risk. Generally, equity
investments in real estate are illiquid and, therefore, the Partnership's
ability to promptly vary its portfolio in response to changing economic,
financial and investment conditions is limited. Real estate investments are also
subject to changes in economic conditions as well as other factors affecting
real estate values, including: (i) possible federal, state or local regulations
and controls affecting rents, prices of goods, fuel and energy consumption and
prices, water and environmental restrictions; (ii) increased labor and material
costs; and (iii) the attractiveness of the property to tenants in the
neighborhood. For a detailed discussion of the risks associated with investment
in real estate, refer to the "Risk Factors" set forth in the Partnership's
prospectus dated June 25, 1985.
11
<PAGE>
THE OFFER
Section 1. Background and Purposes of the Offer. The purpose of the
Offer is to provide Limited Partners who desire to liquidate their investment in
the Partnership with a method for doing so. With the exception of isolated
transactions, no established secondary trading market for the Interests exists
and pursuant to the Partnership Agreement, transfers of Interests are subject to
certain restrictions, including the prior approval of the General Partner. The
General Partner believes that there are certain Limited Partners who desire
immediate liquidity, while other Limited Partners may not need or desire
liquidity and would prefer the opportunity to retain their Interests. The
General Partner believes that the Limited Partners should be entitled to make a
choice between immediate liquidity and continued ownership and, thus, believes
that the Offer being made hereby accommodates the differing goals of both groups
of Limited Partners. Those Limited Partners who tender their Interests pursuant
to the Offer are, in effect, exchanging certainty and liquidity for the
potentially higher return of continued ownership of their Interests. The
continued ownership of Interests, however, entails the risk of loss of all or a
portion of the Limited Partner's investment. See "Risk Factors."
Neither the Offerors nor the General Partner has any current plans or
proposals that relate to or would result in: (i) an extraordinary corporate
transaction, such as a merger, reorganization or liquidation, involving the
Partnership; (ii) a sale or transfer of a material amount of assets of the
Partnership; (iii) any change in the identity of the General Partner or in the
management of the Partnership, including, but not limited to, any plans or
proposals to change the number or term of the General Partner(s), to fill any
existing vacancy for the General Partner, or to change any material term of the
management agreement between the General Partner and the Partnership; (iv) any
material change in the present distribution policy, indebtedness or
capitalization of the Partnership; (v) any other material change in the
structure or business of the Partnership; or (vi) any change in the Partnership
Agreement or other actions that may impede the acquisition of control of the
Partnership by any person. The General Partner, however, may explore and pursue
any of these options in the future.
The purchase of Interests pursuant to the Offer will have the effect of
increasing the proportionate interest in the Partnership of Limited Partners
(including affiliates of the General Partner that own interests) who do not
tender their Interests or tender only a portion of their Interests. Limited
Partners retaining their Interests may be subject to increased risks including
but not limited to: (1) reduction in the Partnership's cash reserves, which may
impact the Partnership's ability to fund its future cash requirements, thus
having a material adverse effect on the Partnership's financial condition; and
(2) increased voting control by the affiliates of the General Partner (including
the Affiliate) and members of the affiliates. See "Risk Factors." Interests that
are tendered to the Partnership in connection with this Offer will be retired,
although the Partnership may issue new interests from time to time in compliance
with the federal and state securities laws or any exemptions therefrom.
Interests purchased by the Affiliate will be held by the Affiliate. Neither the
Partnership nor the General Partner has plans to offer for sale any other
additional interests, but each reserves the right to do so in the future.
12
<PAGE>
The General Partner intends to consider the desirability of the
Partnership making future tender offers to purchase interests following
completion of the Offer, but is not required to make any future offers. Although
the Partnership and its affiliates have from time to time purchased interests,
this is the first tender offer made by the Partnership or the Affiliate for
interests. See Section 2, "Offer to Purchase and Purchase Price; Expiration
Date; Determination of Purchase Price."
Section 2. Offer to Purchase and Purchase Price; Proration;
Expiration Date; Determination of Purchase Price.
Offer to Purchase and Purchase Price. The Offerors will, upon the terms
-------------------------------------
and subject to the conditions of the Offer, described below, purchase in the
aggregate up to 1,250 Interests that are properly tendered by, and not withdrawn
prior to, the Expiration Date at a price equal to $350 per Interest; provided
however, that no tender will be accepted from a Limited Partner if, as a result
of the tender, the Limited Partner would continue to be a Limited Partner and
would hold fewer than five (5) Interests. The Partnership will purchase the
first 750 Interests which are tendered and received by the Partnership by, and
not withdrawn prior to, the Expiration Date. If more than 750 Interests are
tendered and received by the Partnership as a result of this Offer, the
Affiliate will purchase up to an additional 500 Interests which are tendered by,
and not withdrawn prior to, the Expiration Date.
If, on the Expiration Date, the Offerors determine that more than 1,250
Interests have been tendered during the Offer, each Offeror may: (i) accept the
additional Interests permitted to be accepted pursuant to Rule 13e-4(f)(1)
promulgated under the Exchange Act, as amended; or (ii) extend the Offer, if
necessary, and increase the amount of Interests that the Offeror is offering to
purchase to an amount that the Offeror believes to be sufficient to accommodate
the excess Interests tendered as well as any Interests tendered during the
extended Offer.
Proration. If the Offer is oversubscribed and the Offerors do not act
----------
in accordance with (i) or (ii), above, or if the Offerors act in accordance with
(i) and (ii), above, but the Offer remains oversubscribed, then the Offerors
will accept Interests tendered prior to or on the Expiration Date for payment on
a pro rata basis. In the event of Proration, the number of Interests purchased
from a Limited Partner will be equal to a fraction of the Interests tendered,
the numerator of which will be the total number of Interests the Offerors are
willing to purchase and the denominator of which will be the total number of
Interests properly tendered.
Any fractional interests resulting from this calculation will be
rounded down to the nearest whole number. Fractions of Interests will not be
purchased. The Partnership will notify, in writing, all Limited Partners from
whom the Offerors will purchase fewer than the number of Interests tendered by
the Limited Partner. For any Interest tendered but not purchased by the
Offerors, a book entry will be made on the Partnership's books to reflect the
Limited Partner's ownership of the Interests not purchased. The Partnership will
not issue a new Certificate of Ownership for Interests not purchased by the
Offerors, except upon written request of the Limited Partner.
13
<PAGE>
THIS OFFER IS NOT CONDITIONED UPON ANY MINIMUM AMOUNT OF INTERESTS
BEING TENDERED; PROVIDED, HOWEVER, NO TENDER WILL BE ACCEPTED FROM A LIMITED
PARTNER IF, AS A RESULT OF THE TENDER, THE LIMITED PARTNER WOULD CONTINUE TO BE
A LIMITED PARTNER AND WOULD HOLD FEWER THAN FIVE (5) INTERESTS.
Expiration Date. The term "Expiration Date" means 12:00 Midnight,
-----------------
Eastern Standard Time, on Monday, January 18, 1999, unless and until the
Offerors extend the period of time for which the Offer is open, in which event
"Expiration Date" will mean the latest time and date at which the Offer, as
extended by the Offerors, expires. The Partnership may extend the Offer, in its
sole discretion, by providing the Limited Partners with written notice of the
extension; provided, however, that if the Offer is oversubscribed, the
Partnership or the Affiliate may, each in its sole discretion, extend the Offer
by providing the Limited Partners with written notice of the extension. For a
description of how the Offer may be extended or terminated, see Section 13,
"Extensions of Tender Period; Terminations; Amendments."
Determination of Purchase Price. The Purchase Price represents the
----------------------------------
price at which the Offerors are willing to purchase Interests. No Limited
Partner approval is required or was sought regarding the determination of the
Purchase Price. No special committee of the Partnership, the Affiliate or the
Limited Partners has approved this Offer and no special committee or independent
person has been retained to act on behalf of the Partnership or the Affiliate.
Neither the Offerors nor the General Partner has obtained an opinion from an
independent third party regarding the fairness of the Purchase Price.
The Purchase Price offered by the Offerors was determined by the
Partnership in its sole discretion based on: (i) the value of recent sales of
Interests by Limited Partners to third parties in secondary market transactions;
(ii) the value of recent repurchases of interests by the Partnership; and (iii)
the value of recent purchases of Interests by the Partnership's affiliate, Ocean
Ridge. The General Partner is aware of certain sales of Interests made at prices
ranging from $269 to $313.26 per Interest (these prices include commissions and
other mark-ups) by certain Limited Partners to third parties during the period
from January 1, 1997 to April 30, 1998. The Partnership has repurchased
interests, and its affiliate, Ocean Ridge, has purchased, Interests in secondary
market transactions at prices ranging from $234 to $350 per Interest during the
period from October 1, 1995 to September 30, 1998. The information regarding
transactions between Limited Partners and third parties is based on the General
Partner's knowledge and may not reflect all transactions that have taken place
during the time periods set forth above. As of June 30, 1998 and December 31,
1997, the book value of each Interest was approximately $371.32 and $371.12,
respectively.
In determining the Purchase Price, the Partnership did not consider the
liquidation value per Interest or the book value per Interest and did not
appraise the value of its assets.
Section 3. Procedure for Tendering Interests. Limited Partners that
wish to tender Interests pursuant to this Offer must submit a properly completed
and duly executed Letter of Transmittal and Substitute Form W-9, together with
the Certificate(s) of Ownership for the Interests being tendered or if the
Certificate(s) of Ownership for the Interests is (are) lost, stolen, misplaced
14
<PAGE>
or destroyed, the Affidavit and Indemnification Agreement for Missing
Certificate(s) of Ownership executed by the Limited Partner attesting to such
fact (the "Affidavit"), and any other required documents to NTS Investor
Services c/o Gemisys, at the address listed in Section 15, "Address;
Miscellaneous."
THE LETTER OF TRANSMITTAL, SUBSTITUTE FORM W-9, AND CERTIFICATE(S) OF OWNERSHIP
FOR THE INTERESTS BEING TENDERED (OR AFFIDAVIT, IF APPLICABLE) AND ANY OTHER
REQUIRED DOCUMENTS MUST BE RECEIVED BY THE PARTNERSHIP ON OR BEFORE THE
EXPIRATION DATE. NEITHER THE PARTNERSHIP NOR THE AFFILIATE WILL ACCEPT INTERESTS
RECEIVED BY THE PARTNERSHIP AFTER THE EXPIRATION DATE.
Method of Delivery. LIMITED PARTNERS ASSUME ANY RISK ASSOCIATED WITH
-------------------
THE METHOD FOR DELIVERING THE LETTER OF TRANSMITTAL, SUBSTITUTE FORM W-9 AND
CERTIFICATE(S) OF OWNERSHIP FOR THE INTERESTS (OR THE AFFIDAVIT). THE
PARTNERSHIP RECOMMENDS THAT LIMITED PARTNERS SUBMIT ALL DOCUMENTS VIA REGISTERED
MAIL RETURN RECEIPT REQUESTED AND PROPERLY INSURED OR BY AN OVERNIGHT COURIER
SERVICE. LIMITED PARTNERS MAY CONFIRM RECEIPT OF A LETTER OF TRANSMITTAL BY
CONTACTING NTS INVESTOR SERVICES C/O GEMISYS AT THE ADDRESS AND TELEPHONE NUMBER
LISTED IN SECTION 15, "ADDRESS; MISCELLANEOUS."
Determination of Validity. All questions regarding the validity, form,
--------------------------
eligibility (including time of receipt) and acceptance for payment of any
Interests will be determined by the Partnership, in its sole discretion.
Notwithstanding the foregoing, if the Offer is oversubscribed, the Partnership
and the Affiliate may each decide to purchase Interests in excess of the initial
1,250 Interests. In that case, all questions regarding the validity, form or
eligibility (including time of receipt) and acceptance for payment of any
additional Interests purchased by either the Partnership or the Affiliate will
be determined by each respective party, in its sole discretion. Each
determination, whether made by the Partnership or the Affiliate, will be final
and binding. The Partnership or the Affiliate, if applicable, has the absolute
right to waive any of the conditions of the Offer or any defect or irregularity
in any tender, or in the related transmittal documents. Unless waived, any
defects or irregularities must be cured within the time period established by
the Partnership or the Affiliate. In any event, tenders will not be deemed to
have been made until all defects or irregularities have been cured or waived.
The Offerors are neither under any duty nor will they incur any liability for
failure to notify any tendering Limited Partner of any defects, irregularities
or rejections contained in the tenders.
Section 10(b) of the Securities Exchange Act of 1934 (the "Exchange
Act") and Rule 14e-4 promulgated thereunder require that a person tendering
Interests on his, her or its behalf, must own the Interests tendered. Section
10(b) and Rule 14e-4 provide a similar restriction applicable to the tender or
guarantee of a tender on behalf of another person. The tender of Interests
pursuant to any of the procedures described herein constitutes acceptance by the
tendering Limited Partner of the terms and conditions of the Offer including a
representation and warranty that (i) the tendering
15
<PAGE>
Limited Partner owns the Interests being tendered within the meaning of Rule
14e-4; and (ii) the tender complies with Rule 14e-4.
Section 4. Withdrawal Rights. Any Limited Partner tendering Interests
pursuant to this Offer may withdraw the tender at any time prior to the
Expiration Date. For a withdrawal to be effective, it must be in writing and
received by NTS Investor Services c/o Gemisys via mail or facsimile at the
address or facsimile number set forth in the Section 15, "Address;
Miscellaneous" on or before the Expiration Date. Any notice of withdrawal must
specify the name of the person withdrawing the tender and the amount of
Interests previously tendered that are being withdrawn.
All questions as to form and validity of the notice of withdrawal will
be determined by the Partnership, in its sole discretion. If the Offer is
oversubscribed, all questions as to form and validity of the notice of
withdrawal will be determined by the Partnership or the Affiliate, each in its
sole discretion, for any Interests purchased by the Partnership or the
Affiliate, as the case may be, in excess of the initial 1,250 Interests. All
determinations made by the Partnership or the Affiliate will be final and
binding. Interests properly withdrawn will not thereafter be deemed to be
tendered for purposes of the Offer. However, withdrawn Interests may be
retendered by following the procedures set forth in Section 3, "Procedure for
Tendering of Interests" prior to the Expiration Date. Tenders made pursuant to
the Offer which are not otherwise withdrawn in accordance with this Section 4,
"Withdrawal Rights," will be irrevocable.
Section 5. Purchase of Interests; Payment of Purchase Price. Upon the
terms and subject to the conditions of the Offer, the Offerors will pay $350 per
Interest to each Limited Partner properly tendering its Interests. The Purchase
Price will be paid in the form of a check from the purchasing Offeror to each
Limited Partner. All monies due to each Limited Partner will be delivered to the
Limited Partner by first class U.S. Mail deposited in the mailbox within five
(5) business days after the Expiration Date. Under no circumstances will
interest be paid on the Purchase Price to be paid by the Offerors for Interests
tendered, regardless of any extension of the Offer or any delay in making
payment. In the event of Proration as set forth in Section 2, "Offer to Purchase
and Purchase Price; Proration; Expiration Date; Determination of Purchase
Price," the Offerors may not be able to determine the proration factor and pay
for those Interests that have been accepted for payment, and for which payment
is otherwise due, until approximately five (5) business days after the
Expiration Date.
Interests will be deemed purchased at the time of acceptance by the
Offerors but in no event earlier than the Expiration Date. Interests purchased
by the Partnership will be retired, although the Partnership may issue new
interests from time to time in compliance with the registration requirements of
federal and state securities laws or exemptions therefrom. Interests purchased
by the Affiliate will be held by the Affiliate. Neither the Partnership nor the
General Partner has plans to offer for sale any other additional interests, but
each reserves the right to do so in the future.
Section 6. Certain Conditions of the Offer. Notwithstanding any other
provision of this Offer, the Offerors will not be required to purchase or pay
for any Interests tendered and may terminate the Offer as provided in Section
13, "Extensions of Tender Period; Terminations;
16
<PAGE>
Amendments" or may postpone the purchase of, or payment for, Interests tendered
if any of the following events occur prior to the Expiration Date:
(a) there is a reasonable likelihood that consummation of the
Offer would result in the termination of the Partnership (as a
partnership) under Section 708 of the Code;
(b) there is a reasonable likelihood that consummation of the
Offer would result in termination of the Partnership's status as a
partnership for federal income tax purposes under Section 7704 of the
Code;
(c) as a result of the Offer, there would be fewer than three
hundred (300) holders of record, pursuant to Rule 13e-3 promulgated under the
Exchange Act;
(d) there shall have been instituted or threatened or shall be
pending any action or proceeding before or by any court or
governmental, regulatory or administrative agency or instrumentality,
or by any other person, which: (i) challenges the making of the Offer
or the acquisition by the Partnership or the Affiliate of Interests
pursuant to the Offer or otherwise directly or indirectly relates to
the Offer; or (ii) in the Partnership's sole judgment (determined
within five (5) business days prior to the Expiration Date), could
materially affect the business, condition (financial or other), income,
operations or prospects of the Partnership, taken as a whole, or
otherwise materially impair in any way the contemplated future conduct
of the business of the Partnership or materially impair the Offer's
contemplated benefits to the Partnership;
(e) there shall have been any action threatened or taken, or
approval withheld, or any statute, rule or regulation proposed, sought,
promulgated, enacted, entered, amended, enforced or deemed to be
applicable to the Offer or the Partnership or the Affiliate, by any
government or governmental, regulatory or administrative authority or
agency or tribunal, domestic or foreign, which, in the Offerors' sole
judgment, would or might directly or indirectly:
(i) delay or restrict the ability of the Partnership
or the Affiliate, or render the Partnership or the Affiliate
unable, to accept for payment or pay for some or all of the
Interests;
(ii) materially affect the business, condition
(financial or other), income, operations, or prospects of the
Partnership or the Affiliate, taken as a whole, or otherwise
materially impair in any way the contemplated future conduct
of the business of the Partnership or the Affiliate;
(f) there shall have occurred:
(i) the declaration of any banking moratorium or
suspension of payment in respect of banks in the United States;
17
<PAGE>
(ii) any general suspension of trading in, or
limitation on prices for, securities on any United States
national securities exchange or in the over-the-counter
market;
(iii) the commencement of war, armed hostilities or
any other national or international crises directly or
indirectly involving the United States;
(iv) any limitation (whether or not mandatory) by any
governmental, regulatory or administrative agency or authority
on, or any event which, in the Offerors' sole judgment, might
affect, the extension of credit by banks or other lending
institutions in the United States;
(v) (A) any significant change, in the Offerors' sole
judgment, in the general level of market prices of equity
securities or securities convertible into or exchangeable for
equity securities in the United States or abroad or (B) any
change in the general political, market, economic, or
financial conditions in the United States or abroad that (1)
could have a material adverse effect on the business condition
(financial or other), income, operations or prospects of the
Partnership, or (2) in the sole judgment of the Offerors,
makes it inadvisable to proceed with the Offer; or
(vi) in the case of the foregoing existing at the
time of the commencement of the Offer, in the Offerors' sole
judgment, a material acceleration or worsening thereof;
(g) any change shall occur or be threatened in the business,
condition (financial or otherwise), or operations of the Partnership,
that, in the Partnership's sole judgment, is or may be material to the
Partnership;
(h) a tender or exchange offer for any or all of the Interests
of the Partnership, or any merger, business combination or other
similar transaction with or involving the Partnership, shall have been
proposed, announced or made by any person;
(i) (i) any entity, "group" (as that term is used in Section
13(d)(3) of the Exchange Act) or person (other than entities, groups or
persons, if any, who have filed with the Commission on or before
October 20, 1998 a Schedule 13G or a Schedule 13D with respect to any
of the Interests) shall have acquired or proposed to acquire beneficial
ownership of more than 5% of the outstanding Interests; or (ii) such
entity, group, or person that has publicly disclosed any such
beneficial ownership of more than 5% of the Interests prior to such
date shall have acquired, or proposed to acquire, beneficial ownership
of additional Interests constituting more than 2% of the outstanding
Interests or shall have been granted any option or right to acquire
beneficial ownership of more than 2% of the outstanding Interests; or
(iii) any person or group shall have filed a Notification and Report
Form under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 or
made a public announcement reflecting an intent to acquire the
Partnership or its assets; or
18
<PAGE>
(j) the General Partner determines that it is not in best
interest of the Partnership to purchase Interests pursuant to the
Offer;
which, in the sole judgment of the Offerors, in any such case and regardless of
the circumstances (including any action of the Partnership or the Affiliate)
giving rise to such event, makes it inadvisable to proceed with the Offer or
with such purchase or payment. The foregoing conditions are for the sole benefit
of the Partnership and the Affiliate and may be asserted by the Partnership or
the Affiliate on their respective behalf regardless of the circumstances giving
rise to any such condition (including any action or inaction by the Partnership
or the Affiliate) or may be waived by the Partnership or the Affiliate in whole
or in part. The Offerors' failure at any time to exercise any of the foregoing
rights shall not be deemed a waiver of any such right and each such right shall
be deemed an ongoing right which may be asserted at any time and from time to
time. Any determination by the Partnership or the Affiliate concerning the
events described in this Section 6, "Certain Conditions of the Offer" shall be
final and binding on all parties. As of the date hereof, the Offerors believe
that neither paragraph (a) nor paragraph (b) of this Section 6, "Certain
Conditions of the Offer" will prohibit the consummation of the Offer.
Section 7. Cash Distribution Policy. The Partnership commenced
operations in December, 1984 and has, with the exception of certain quarters of
1991 and 1992, consistently paid quarter distributions. Limited Partners that
tender the Interests pursuant to the Offer will not be entitled to receive any
cash distributions made, if any, after the Expiration Date, on any Interests
which are tendered and accepted by the Offerors. There can be no assurance that
the Partnership will make any distributions in the future to Limited Partners
who continue to own Interests following completion of the Offer.
Section 8. Effects of the Offer. In addition to the effects of the
Offer on tendering and non-tendering Limited Partners and upon the General
Partner as set forth in the "Risk Factors" of this Offer to Purchase, the Offer
will affect the Partnership in several other respects:
The Partnership will use some or all of its existing cash reserves to
purchase Interests. The use of the Partnership's cash reserve will have the
effect of: (i) reducing the cash available to fund future needs and
contingencies or to make future distributions; and (ii) reducing or eliminating
the Partnership's present interest income earned on such cash reserves.
Financial statements giving pro forma effect of the Offer, assuming the purchase
by the Partnership of 750 Interests at $350 per Interest, are attached hereto as
Appendix A.
Upon completion of the Offer, the Offerors may consider purchasing any
interests not purchased in the Offer. Any such purchases may be on the same
terms as the terms of this Offer or on terms which are more favorable or less
favorable to Limited Partners than the terms of this Offer. Rule 13e-4
promulgated under the Exchange Act prohibits the Offerors from purchasing any
Interests, other than pursuant to the Offer, until at least ten (10) business
days after the Expiration Date. Any possible future purchases by the Partnership
will depend on many factors, including but not limited to, the market price of
Interests, the results of the Offer, the Partnership's business and financial
position and general economic market conditions.
19
<PAGE>
Section 9. Source and Amount of Funds. The total amount of funds
required to complete this Offer is approximately $499,500 (including $437,500 to
purchase 1,250 Interests plus approximately $62,000 for expenses related to
administering the Offer). The Partnership expects to fund monies required to
complete its purchases and to pay its portion of expenses (approximately
$262,500 to purchase 750 Interests and approximately $37,200 for its
proportionate share of expenses related to administering the Offer; the expenses
of the Offer will be apportioned between the Offerors based on the number of
Interests purchased by each Offeror) from its cash reserves. As of December 31,
1997 and June 30, 1998 the Partnership had unrestricted cash and cash
equivalents equal to $276,891 and $1,074,627, respectively. If the Offer is
oversubscribed and the Partnership, in its sole discretion, decides to purchase
Interests in excess of 750 Interests, the Partnership will fund these additional
purchases and expenses, if any, from its cash reserves.
The Affiliate expects to fund monies required to complete its purchases
and to pay its portion of expenses (approximately $175,000 to purchase 500
Interests and approximately $24,800 for its proportionate share of expenses
related to administering the Offer; the expenses of the Offer will be
apportioned between the Offerors based on the number of Interests purchased by
each Offeror) from cash contributions to be made to the Affiliate by its
members. If the Offer is oversubscribed and the Affiliate, in its sole
discretion, decides to purchase Interests in excess of 500 Interests, the
Affiliate will fund these additional purchases and expenses, if any, from these
cash contributions.
Section 10. Certain Information About the Partnership
Certain Information About the Partnership.
- ------------------------------------------
The Partnership was formed in December, 1984 under the laws of the
State of Maryland. The general partner is NTS-Properties Associates VI, a
Kentucky limited partnership. Except as otherwise provided in the Partnership
Agreement, NTS Properties Associates VI owns a one percent (1%) interest in the
Partnership and the limited partners own, in the aggregate, a ninety-nine
percent (99%) interest in the Partnership. The Partnership owns the following
residential and commercial real properties:
- Sabal Park Apartments is a 162-unit luxury apartment complex
located in Orlando, Florida. As of June 30, 1998, the property
was 98% occupied. The Partnership has two mortgage loans each
with an insurance company which had a total outstanding
balance of $4,612,598 on June 30, 1998. Both mortgages are
secured by the property and bear interest at a fixed rate of
7.38%. Both mortgages mature on December 5, 2012.
- Park Place Apartments Phase I is a 180-unit luxury apartment
complex located in Lexington, Kentucky. As of June 30, 1998,
the property was 85% occupied. The Partnership has a
$12,200,000 mortgage payable to an insurance company which had
an outstanding balance of $5,000,000 as of June 30, 1998. The
mortgage is secured by the property and Park Place Apartments
Phase III (described below) and bears interest at a fixed rate
of 7.74%. The mortgage matures on October 15, 2012.
20
<PAGE>
Approximately $7,200,000 of the proceeds of the mortgage will
be used to fund the construction of Park Place Apartments
Phase III.
- Park Place Apartments Phase III is a to-be-constructed
152-unit luxury apartment complex, located adjacent to Park
Place Apartments Phase I in Lexington, Kentucky. Construction
of Phase III began in April, 1998 and is anticipated to be
completed in mid to late 1999. The cost of construction is
anticipated to be approximately $9,100,000 and will be funded
from proceeds of the mortgage secured by the property, Park
Place Apartments Phase I and the Partnership's cash reserves.
As of June 30, 1998, the Partnership incurred approximately
$400,000 in pre-development costs.
- Willow Lake Apartments is a 200-unit luxury apartment complex,
located in Indianapolis, Indiana. As of June 30, 1998, the
property was 97% occupied. The Partnership has a mortgage
payable to an insurance company which had an outstanding
balance as of June 30, 1998 of $8,236,308. The mortgage is
secured by the property and bears interest at a fixed rate of
7.32%. The mortgage matures on October 15, 2012.
The Partnership through a joint venture partnership with NTS Properties
IV, an affiliate of the General Partner, owns an interest in the following real
properties:
- Golf Brook Apartments is a 195-unit luxury apartment complex
located in Orlando, Florida. The Partnership's percentage
interest in the joint venture is 96%. As of June 30, 1998, the
property was 96% occupied. The Partnership has a mortgage
secured by the property which had an outstanding balance as of
June 30, 1998 of $8,476,231. The mortgage bears interest at a
fixed rate of 7.43% and matures on May 14, 2009.
- Plainview Point III Office Center is an office center
containing approximately 59,552 rentable square feet, located
in Louisville, Kentucky. The Partnership's percentage interest
in the joint venture is 96%. As of March 31, 1998, the
property was 96% occupied. The property is unencumbered by any
mortgage.
The Partnership has no material commitments for renovation or capital
improvements.
Section 11. Certain Federal Income Tax Consequences.
Certain Federal Income Tax Consequences of the Offer. The following is
------------------------------------------------------
a general summary under currently applicable law of certain federal income tax
considerations generally applicable to the sale of Interests pursuant to the
Offer. The following summary is for general information only, and the tax
treatment described herein may vary depending upon each Limited Partner's
particular situation. Certain Limited Partners (including, but not limited to,
insurance companies, tax-exempt organizations, financial institutions or
broker/dealers, foreign corporations, and persons who are not citizens or
residents of the United States) may be subject to special rules not discussed
below. In
21
<PAGE>
addition, the summary does not address the federal income tax consequences to
all categories of Interest holders, nor does it address the federal income tax
consequences to persons who do not hold the Interests as "capital assets," as
defined by the Internal Revenue Code of 1986, as amended (the "Code"). No ruling
from the Internal Revenue Service ("IRS") will be sought with respect to the
federal income tax consequences discussed herein; thus, there can be no
assurance that the IRS will agree with the conclusions stated herein. Limited
Partners are urged to consult their own tax advisors as to the particular tax
consequences of a tender of their Interests pursuant to the Offer, including the
applicability and effect of any state, local, foreign or other tax laws, any
recent changes in applicable tax laws and any proposed legislation. The
following information is intended as a general statement of certain tax
considerations, and Limited Partners should not construe this as legal or tax
advice.
Sale of Interests Pursuant to the Offer. The receipt of cash for
--------------------------------------------
Interests pursuant to the Offer will be a taxable transaction for federal income
tax purposes and may also be a taxable transaction under applicable state, local
and other tax laws. The purchase of Interests pursuant to the Offer will be
deemed a sale of the Interests by the tendering Limited Partner. The payment for
a Limited Partner's Interests may be in complete liquidation of that portion of
the Limited Partner's ownership in the Partnership represented by the purchased
Interests. The recipient of such payments is taxable to the extent of any gain
or loss recognized in connection with such sale. In general, and subject to the
recapture rules of the Code Section 751 discussed below, a holder will recognize
capital gain or loss at the time his or her Interests are purchased by the
Partnership to the extent that the money distributed to him or her exceeds his
or her adjusted basis in the purchased Interests. Upon a sale of an Interest
pursuant to the Offer, a Limited Partner will be deemed to have received money
in the form of any cash payments to him or her and to the extent he or she is
relieved from his or her proportionate share of liabilities, if any, to which
the Partnership's assets are subject. A Limited Partner will thus be required to
recognize gain upon the sale of his or her Interests if the amount of cash he or
she received, plus the amount he or she is deemed to have received as a result
of being relieved of his or her proportionate share of Partnership nonrecourse
liabilities (if any), exceeds the adjusted basis of the Limited Partner in the
purchased Interests. The income taxes payable upon the sale must be determined
by each Limited Partner on the basis of his or her own financial interests.
The adjusted basis of a Limited Partner's Interests is calculated by
taking his or her initial basis and making certain additions and subtractions
thereto. The initial basis of a Limited Partner is the amount paid for an
Interest ($1,000 per Interest for those who purchased in the initial offering),
increased by a Limited Partner's proportionate share of nonrecourse liabilities,
if any, to which the Partnership's assets are subject and by the share of
Partnership taxable income, capital gains and other income items allocated to
the Limited Partner. There was nonrecourse debt attributed to the Interests in
the approximate amount of $26,375,137 as of June 30, 1998. A Limited Partner's
basis is reduced by cash distributions and by the share of Partnership losses
allocated to the Limited Partner.
A selling Limited Partner will be allocated a pro rata share of the
Partnership's taxable income or loss for 1998 with respect to the Interests sold
in accordance with the provisions of the Partnership Agreement concerning
transfers of Interests. Such allocation will affect the Limited Partner's
adjusted tax basis in his or her Interests and, therefore, the amount of the
Limited Partner's
22
<PAGE>
taxable gain or loss upon a sale of Interests pursuant to this Offer. For
individuals, trusts and estates the income allocated will be treated as ordinary
income which could be taxed at a rate as high as 39.6% for federal income tax
purposes, while the corresponding reduction in taxable gain upon the sale of the
Interests will result in tax savings of no more than 28% of the reduction in
taxable gain. The Partnership's net income for the six-month period ended June
30, 1998 was $365,597.
In determining the tax consequences of accepting the Offer, the
Partnership's payments for Interests will be deemed to be equal to the $350 cash
payment per Interest plus a pro rata share of the Partnership's nonrecourse debt
(together, the "Selling Price"). The taxable gain (or loss) to be incurred as a
consequence of accepting the Offer is determined by subtracting the Selling
Price from the adjusted basis of the purchased Interest. Each Limited Partner
must determine his or her own adjusted tax basis because it will vary depending
upon when the Limited Partner purchased the Interests and the amount of
distributions received for each Interest, which varies depending upon the date
on which the Limited Partner was admitted to the Partnership. A taxable gain, if
any, on the disposition of Interests must be allocated between ordinary income
and long term capital gain. Long term capital gain or loss will be realized on
such sale by a Limited Partner if: (1) he or she is not a "dealer" in
securities; (2) he or she has held the Interests for longer than twelve (12)
months; and (3) the Partnership has no Section 751 assets. To the extent that a
portion of the gain realized on the sale of an Interest is attributable to
Section 751 assets (i.e., "unrealized receivables" and "inventory items of the
Partnership which have appreciated substantially in value") a Limited Partner
will recognize ordinary income, and not a capital gain, upon the sale of the
Interest. For purposes of Code Section 751, certain depreciation deductions
claimed by the Partnership (recapturable cost recovery allowance) are treated as
if they were an "unrealized receivable." Thus, gain, if any, recognized by a
Limited Partner who sells an Interest will be ordinary income in an amount not
to exceed his or her share of the Partnership's recapturable cost recovery
allowance. Furthermore, if the Partnership were deemed to be a "dealer" in real
estate for federal income tax purposes, the property held by the Partnership
might be treated as "inventory items of the Partnership which have appreciated
substantially in value" for purposes of Code Section 751 and a Limited Partner
tendering his or her Interest would recognize ordinary income, in an amount
equal to his or her share of the appreciation in value of the Partnership's real
estate inventory. The General Partner does not believe it has operated the
Partnership's business in a manner as to make the Partnership a "dealer" for tax
purposes.
For taxable Limited Partners the amount of recapturable cost recovery
allowance per Interest purchased by a Limited Partner in the original offering
is estimated to be $266.66 as of June 30, 1998. Therefore, a maximum of $266.66
of the taxable gain per Interest will be considered to be ordinary income, with
the balance of the taxable gain considered to be capital gain for federal income
tax purposes for the Limited Partners who hold their Interests as capital
assets. Ordinary income recognized in 1998 is taxed at a stated maximum rate of
39.6% for federal income tax purposes. Net capital gains are taxed for federal
income tax purposes at a stated maximum rate of 20% for Interests held at least
twelve (12) months. The tax rates may actually be somewhat higher, depending on
the taxpayer's personal exemptions and amount of adjusted gross income. A
taxable loss, if any, on the disposition of Interests will be recognized as a
capital loss for federal income tax purposes for Limited Partners who hold their
Interests as capital assets. Tax exempt Limited Partners may be subject to a
recapturable cost recovery allowance. The amount of recapturable cost recovery
allowance per Interest for tax exempt Limited Partners, if any, may be less than
that for taxable Limited Partners. Tax exempt Limited Partners subject to
unrelated business
23
<PAGE>
taxable income (UBTI) should consult their tax advisor to determine what amount,
if any, of the recapturable cost recovery allowance should be reported as UBTI.
Foreign Limited Partners. Gain realized by a foreign Limited Partner on
-------------------------
a sale of Interests pursuant to this Offer will be subject to federal income
tax. Under Code Section 1445 and related regulations, the transferee of a
partnership interest held by a foreign person is generally required to deduct
and withhold a tax equal to 10% of the amount realized on the disposition. The
Partnership or the Affiliate, as the case may be, will withhold 10% of the
amount realized by a tendering foreign Limited Partner. Amounts withheld would
be creditable against a foreign Limited Partner's federal income tax liability,
and if in excess thereof, a refund could be obtained from the IRS by filing a
U.S. income tax return.
To prevent back-up federal income tax withholding equal to 31% of the
payments made pursuant to the Offer, each Limited Partner (except a foreign
Limited Partner) who does not otherwise establish an exemption from such
withholding must notify the Partnership of the Limited Partner's correct
taxpayer identification number (or certify that such taxpayer is awaiting a
taxpayer identification number) and provide certain other information by
completing a Substitute Form W-9 to the Partnership. (For each Limited Partner's
convenience, a Substitute Form W-9 is enclosed herein). Certain Limited
Partners, including corporations, are not subject to the withholding and
reporting requirements. Foreign Limited Partners are subject to other
requirements.
Retirement Plan Investors. Qualified pension, profit sharing and stock
--------------------------
bonus plans and IRA's (collectively "Qualified Plans") are generally exempt from
taxation except to the extent that their UBTI, determined in accordance with
Code Sections 511-514, exceeds $1,000 in any taxable year. Code Section
512(b)(5) provides generally that UBTI does not include gains or losses from the
disposition of property other than inventory or property held primarily for sale
to customers in the ordinary course of business. However, Treasury Regulation
1.1245-6(b) provides that Code Section 1245 overrides the nonrecognition
provisions of subtitle A of the Code, including Code Section 512(b)(5), if
applicable; furthermore Code Section 12(b)(4) provides that notwithstanding Code
Section 512(b)(5), a portion of the gain from the sale of "debt-financed
property" (as defined in Section 514) may be treated as UBTI. Because a portion
of the Partnership's assets are "debt financed," a portion of the gain, if any,
recognized by a Qualified Plan on the sale of an interest may be UBTI. If a
Qualified Plan is not a "dealer" in securities, the remaining portion of any
gain from the sale of Interests will not be UBTI unless the Partnership is
deemed to be a "dealer" in real estate. The General Partner does not believe the
Partnership's business has been operated in such a manner as to make it a
dealer, but there is no assurance that the IRS may not contend that the
Partnership is a dealer. If the Partnership obtains financing to purchase
Interests, the IRS may contend that each nonredeeming Limited Partner has
acquired an interest in debt-financed property, in addition to the current
debt-financed property of the Partnership. See Section 9, "Source and Amount of
Funds."
Section 12. Transactions and Arrangements Concerning Interests. Based
upon the Partnership's and Affiliate's records and information provided to the
Partnership by the General Partner and affiliates of the General Partner,
neither the Partnership, General Partner, the Affiliate nor, to the best of the
Partnership's knowledge, any controlling person of the Partnership, the
24
<PAGE>
General Partner, or the Affiliate, has effected any transactions in the
Interests during the forty (40) business days prior to the date hereof, except
as set forth below:
On August 21, 1998, the Partnership repurchased 202 interests at a
price equal to $350 per Interest pursuant to the Partnership's Interest
Repurchase Program.
On September 10, 1998, the Partnership repurchased 113 interests at a
price equal to $350 per interest pursuant to the Partnership's Interest
Repurchase Program.
On September 28, 1998, the Partnership repurchased 283 interests at a
price equal to $350 per interest pursuant to the Partnership's Interest
Repurchase Program.
Section 13. Extensions of Tender Period; Terminations; Amendments. The
Partnership has, or, if the Offer is oversubscribed, each Offeror has, the right
at any time and from time to time, to extend the period of time during which the
Offer is open by giving written notice of the extension to each Limited Partner.
If there is any extension, all Interests previously tendered and not purchased
or withdrawn will remain subject to the Offer and may be purchased by the
Offerors, except to the extent that such Interests may be withdrawn as set forth
in Section 4, "Withdrawal Rights."
If the Offer is oversubscribed, each Offeror has the right to purchase
additional Interests. If either Offeror decides, in its sole discretion, to
increase the amount of Interests being sought and, at the time that the notice
of such increase is first published, sent or given to holders of Interests, the
Offer is scheduled to expire at any time earlier than the expiration of a period
ending on the tenth business day from, and including, the date that such notice
is first so published, sent or given, then the Offer will be extended until the
expiration of such period of ten (10) business days.
For purposes of the Offer, a "business day" means any day other than a
Saturday, Sunday or federal holiday and consists of the time period from 12:01
a.m. through 12:00 Midnight, Eastern Standard Time. The Offerors have the right:
(i) to terminate the Offer and not to purchase or pay for any Interests not
previously purchased or paid for upon the occurrence of any of the conditions
specified in Section 6, "Certain Conditions of the Offer," by giving written
notice of such termination to the Limited Partners and making a public
announcement thereof; or (ii) at any time and from time to time, to amend the
Offer in any respect. All extensions, delays in payment or amendments will be
followed by public announcements thereof, such announcements in the case of an
extension to be issued no later than 9:00 a.m. Eastern Standard Time, on the
next business day after the previously scheduled Expiration Date. Without
limiting the manner in which the Offerors may choose to make any public
announcement, except as provided by applicable law (including Rule 13e-4(e)(2)
under the Exchange Act), the Offerors have no obligation to publish, advertise
or otherwise communicate any such public announcement, other than by issuing a
release to the Dow Jones News Service.
Section 14. Fees and Expenses. The Offerors will not pay any fees or
commissions to any broker, dealer or other person for soliciting tenders of
Interests pursuant to the Offer. The
25
<PAGE>
Offerors will reimburse brokers, dealers, commercial banks and trust companies
for customary handling and mailing expenses incurred in forwarding the Offer to
their customers.
Section 15. Address; Miscellaneous.
Address. All executed copies of the Letter of Transmittal, Substitute
--------
Form W-9 and the Certificate(s) of Ownership for the Interests being tendered
(or the Affidavit) must be sent via mail or overnight courier service to the
address set forth below. Manually signed facsimile copies of the Letter of
Transmittal will not be accepted. The Letter of Transmittal, Substitute Form W-9
and Certificate(s) of Ownership for the Interests being tendered (or the
Affidavit) should be sent or delivered by each Limited Partner or such Limited
Partner's broker, dealer, commercial bank, trust company or other nominee as
follows:
By Mail, Hand Delivery or Overnight Mail/Express:
NTS Investor Services
c/o Gemisys
7103 S. Revere Parkway
Englewood, CO 80112
Any questions, requests for assistance, or requests for additional
copies of this Offer to Purchase, the Letter of Transmittal or any other
documents relating to this Offer also may be directed to NTS Investor Services
c/o Gemisys at the above-listed address or at: (800) 387-7454 or by facsimile
at: (303) 705-6151.
Miscellaneous. The Offer is not being made to, nor will tenders be
--------------
accepted from, Limited Partners in any jurisdiction in which the Offer or its
acceptance would not comply with the securities or Blue Sky laws of such
jurisdiction. Neither Offeror is aware of any jurisdiction in which the Offer or
tenders pursuant thereto would not be in compliance with the laws of such
jurisdiction. The Offerors reserve the right to exclude Limited Partners in any
jurisdiction in which it is asserted that the Offer cannot lawfully be made. The
Offerors believe such exclusion is permissible under applicable laws and
regulations, provided the Offerors make a good faith effort to comply with any
state law deemed applicable to the Offer.
26
<PAGE>
The Offerors have filed an Issuer Tender Offer Statement on Schedule
13E-4 with the Securities and Exchange Commission ("Commission") which includes
certain information relating to the Offer summarized herein. A copy of this
statement may be obtained from the Partnership by contacting NTS Investor
Services c/o Gemisys at the address and phone number set forth in this Section
15, "Address; Miscellaneous," or from the public reference office of the
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington D.C. 20549.
The Commission also maintains a site on the World Wide Web at http://www.sec.gov
that contains reports electronically filed by the Partnership with the
Commission.
NTS-Properties VI
October 20, 1998
356508-9
27
<PAGE>
Appendix A
The Partnership's Financial Statements Giving
Pro Forma Effect of the Offer
The following unaudited pro forma balance sheet and income statement of the
Partnership are presented to give effect of the Offer as if it was fully
subscribed and completed before June 30, 1998 and December 31, 1997. Each pro
forma statement contains four columns. The two columns on the left contain
certain financial information extracted or derived from the Partnership's
Quarterly Report on Form 10-Q for the quarter ended June 30, 1998 and its Annual
Report on Form 10-K for the fiscal year ended December 31, 1997, respectively.
The Quarterly and Annual Reports contain more comprehensive financial
information than the information contained herein and were filed with the
Securities and Exchange Commission ("Commission") pursuant to the Securities
Exchange Act of 1934. The information extracted from the Quarterly and Annual
Reports is qualified in its entirety by reference to the reports and the
financial statements (including the notes) contained in the reports. The two
columns on the right present the quarterly and annual reports of the Partnership
giving effect of the Offer as if the Offer was fully subscribed and completed
before June 30, 1998 and December 31, 1997. The information presented in these
columns is based on certain assumptions made by the Partnership in its good
faith judgment, such as, the amount of expenses it will incur in administering
the Offer. These unaudited pro forma statements are not necessarily indicative
of what the Partnership's actual financial condition would have been for the
quarter ended June 30, 1998 and the year ended December 31, 1997, nor do they
purport to represent the future financial position of the Partnership.
356508-9
28
<PAGE>
<TABLE>
NTS-PROPERTIES VI,
A Maryland Limited Partnership
------------------------------
BALANCE SHEETS AND STATEMENT OF PARTNERS' EQUITY
------------------------------------------------
<CAPTION>
Actual Actual After Tender After Tender
As of As of As of As of
June 30, December June 30, December
1998 31, 1997 1998 31, 1997
---- -------- ---- --------
ASSETS:
- -------
<S> <C> <C> <C> <C>
Cash and equivalents $ 1,074,627 $ 276,891 $ 812,127 $ 14,391
Cash and equivalents - restricted 444,265 507,568 444,265 507,568
Investment securities 508,474 1,562,813 508,474 1,562,813
Accounts receivable 165,855 111,152 165,855 111,152
Land, buildings and amenities, net 38,106,181 38,660,912 38,106,181 38,660,912
Assets held for development, net 2,105,517 1,774,455 2,105,517 1,774,455
Other assets 420,767 395,817 420,767 395,817
----------- ----------- ----------- -----------
$42,825,686 $43,289,608 $42,563,186 $43,027,108
=========== =========== =========== ===========
LIABILITIES AND PARTNERS' EQUITY
- --------------------------------
Mortgages payable $26,375,137 $26,872,563 $26,375,137 $26,872,563
Accounts payable 301,861 195,165 301,861 195,165
Distributions payable 104,510 213,687 104,510 213,687
Security deposits 242,488 237,501 242,488 237,501
Other liabilities 325,512 67,340 325,512 67,340
----------- ----------- ----------- -----------
27,349,508 27,586,256 27,349,508 27,586,256
Commitments and Contingencies
Partners' equity 15,476,178 15,703,352 15,213,678 15,440,852
----------- ----------- ----------- -----------
$42,825,686 $43,289,608 $42,563,186 $43,027,108
=========== =========== =========== ===========
</TABLE>
<PAGE>
<TABLE>
NTS-PROPERTIES VI,
A Maryland Limited Partnership
------------------------------
STATEMENTS OF OPERATIONS
------------------------
<CAPTION>
After Tender After Tender
June 30, December 31, June 30, December 31,
1998 1997 1998 1997
---- ---- ---- ----
REVENUES:
<S> <C> <C> <C> <C>
Rental income $4,835,153 $ 9,493,634 $ 4,835,153 $ 9,493,634
Interest and other income 61,534 114,639 61,534 114,639
---------- ----------- ----------- -----------
4,896,687 9,608,273 4,896,687 9,608,273
EXPENSES:
Operating expenses 1,178,482 2,493,211 1,178,482 2,493,211
Operating expenses - affiliated 607,542 1,091,454 607,542 1,091,454
Write-off of unamortized
land improvements and
amenities 12,599 2,244 12,599 2,244
Interest expense 981,922 2,194,368 981,922 2,194,368
Management fees 245,417 480,335 245,417 480,335
Real estate taxes 403,820 779,214 403,820 779,214
Professional and administrative
expenses 69,776 150,846 69,776 150,846
Professional and administrative
expenses - affiliated 134,954 300,159 134,954 300,159
Depreciation and amortization 896,598 1,910,785 896,598 1,910,785
---------- ----------- ----------- -----------
4,531,110 9,402,616 4,531,110 9,402,616
---------- ----------- ----------- -----------
Income before extraordinary item 365,577 205,657 365,577 205,657
Extraordinary item - write off
unamortized loan costs -- (98,544) -- (98,544)
---------- ----------- ----------- -----------
Income before tender offer cost 365,577 107,113 365,577 107,113
Tender offer cost -- -- (62,000) (62,000)
---------- ----------- ----------- -----------
Net income $ 365,577 $ 107,113 $ 303,577 $ 45,113
========== =========== =========== ===========
Net income allocated to the limited partners:
Income before extraordinary item $ 361,921 $ 203,600 $ 361,921 $ 203,600
Extraordinary Item -- (97,558) -- (97,558)
---------- ----------- ----------- -----------
Income before tender offer cost 361,921 106,042 361,921 106,042
Tender offer cost -- -- (61,380) (61,380)
---------- ----------- ----------- -----------
Net Income $ 361,921 $ 106,042 $ 300,541 $ 44,662
========== =========== =========== ===========
Net income per limited partnership unit:
Income before extraordinary item $ 8.58 $ 4.76 $ 8.74 $ 4.84
Extraordinary item -- (2.28) -- (2.32)
---------- ----------- ----------- -----------
Income before tender offer cost 8.58 2.48 8.74 2.52
Tender offer cost -- -- (1.49) (1.46)
---------- ----------- ----------- -----------
Net income $ 8.58 $ 2.48 $ 7.25 $ 1.06
========== =========== =========== ===========
Weighted average number of
limited partnership units 42,181 42,817 41,431 42,067
========== =========== =========== ===========
</TABLE>
<PAGE>
Exhibit (a)(2)
Form of Letter of Transmittal
29
<PAGE>
LETTER OF TRANSMITTAL
Regarding the Interests in
NTS - PROPERTIES VI
Tendered Pursuant to the Offer to Purchase Dated October 20, 1998
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT, AND THIS LETTER OF
TRANSMITTAL MUST BE RECEIVED BY THE PARTNERSHIP BY, 12:00 MIDNIGHT
EASTERN STANDARD TIME, ON MONDAY, JANUARY 18, 1999
(THE "EXPIRATION DATE"),
UNLESS THE OFFER IS EXTENDED BY OFFERORS.
[Investor Name] If applicable:
[Address] [Custodian]
[City, State, Zip] [Address]
[Tax I.D. #] [City, State, Zip]
[# of Interests] [Account #]
I am a Limited Partner of NTS-Properties VI. I hereby tender my limited
partnership interests or portion thereof, as described and specified below, to
the Offerors, NTS-Properties VI (the "Partnership"), and the Partnership's
affiliate, ORIG, LLC, (the "Affiliate" and the Partnership are each an "Offeror"
and collectively the "Offerors") upon the terms and conditions set forth in the
Offer to Purchase, dated October 20, 1998 (collectively, the "Offer to Purchase"
and "Letter of Transmittal" constitute the "Offer").
THIS LETTER OF TRANSMITTAL IS SUBJECT TO ALL THE TERMS AND CONDITIONS
SET FORTH IN THE OFFER TO PURCHASE, INCLUDING, BUT NOT LIMITED TO, THE ABSOLUTE
RIGHT OF THE OFFERORS TO REJECT ANY AND ALL TENDERS DETERMINED BY THEM, IN THEIR
SOLE DISCRETION, NOT TO BE IN THE APPROPRIATE FORM.
I hereby represent and warrant that I have full authority to sell my
interests, or portion thereof, to the Offerors, and that the Offerors will
acquire good title, free and clear of any adverse claim. Upon request, I will
execute and deliver any additional documents necessary to complete the sale of
my interests in accordance with the terms of the Offer. In the event of my death
or incapacity, all authority and obligation shall be placed with my heirs,
personal representatives and successors.
I hereby appoint NTS-Properties Associates VI (without posting of a
bond) as the attorney-in-fact of me with respect to my interests, with full
power of substitution (such power of attorney being deemed to be an irrevocable
power coupled with an interest), to: (1) transfer ownership of my interests on
the Partnership's books to the respective Offeror, (2) change the address of
record of my interests prior to or after completion of the transfer, (3) execute
and deliver lost certificate indemnities and all other transfer documents, (4)
direct any custodian or trustee holding record title to the interests to do what
is necessary, including the execution and delivery of a copy of this Letter of
Transmittal, and (5) upon payment by the respective Offeror of the purchase
price, to receive all benefits and cash distributions and otherwise exercise all
rights of beneficial ownership of my interests hereby tendered.
(Over)
<PAGE>
INSTRUCTIONS TO TENDER INTERESTS
Please complete the following steps to tender your interests:
oComplete Part 1. by inserting the number of interests you wish to tender.
oComplete Part 2. by providing your telephone number(s).
oComplete Part 3. by providing the appropriate signature(s). (Note: if your
account is held by a Trustee or Custodian, sign below and forward this form to
the Trustee or Custodian at the address noted on the first page of this Letter
of Transmittal to complete the remaining steps). All signatures must be
notarized by a Notary Public.
oReturn your original Certificate(s) of Ownership for the interests with this
form. If you are unable to locate your Certificate(s) of Ownership, complete the
Affidavit and Indemnification Agreement for Missing Certificate(s) of Ownership.
PART 1. NUMBER OF INTERESTS IN THE PARTNERSHIP TO BE TENDERED:
[ ] I tender my entire interest in the Partnership, being _______ interests
for a price of $350.00 per interest.
[ ] I tender only a portion of my interest in the Partnership, being ______
interests for a price of $350.00 per interest.
PART 2. TELEPHONE NUMBER(S).
My telephone numbers are:(___) _________ [Daytime] and (___) _________ [Evening]
PART 3. SIGNATURE(S).
FOR INDIVIDUALS/JOINT OWNERS:
- -------------------------------- --------------------------------
Print Name of Limited Partner Print Name of Joint Owner
- -------------------------------- --------------------------------
Signature of Limited Partner Signature of Joint Owner
Sworn to me this ___ day of Sworn to me this ___ day of
_____________, 199__. ____________, 199__.
- -------------------------------- --------------------------------
Notary Public Notary Public
FOR CUSTODIAL/TRUSTEE/IRA ACCOUNTS:
- -------------------------------- --------------------------------
Print Name of Signatory Signature
Sworn to me this ___ day of
____________, 199__.
- -------------------------------- --------------------------------
Title of Signatory Notary Public
Return or Deliver: (1) this Letter of Transmittal; (2) your original
Certificate(s) of Ownership for the interests, or if you are unable to locate
your Certificate(s) of Ownership, the Affidavit and Indemnification Agreement
for Missing Certificate(s) of Ownership; and (3) the Substitute Form W-9 on or
before the Expiration Date to:
NTS INVESTOR SERVICES
C/O GEMISYS
7103 S. REVERE PARKWAY
ENGLEWOOD, CO 80112
For additional information, call: (800) 387-7454.
365631-3
<PAGE>
Exhibit (a)(3)
Form of Affidavit and Indemnification Agreement for
Missing Certificate(s) of Ownership
30
<PAGE>
AFFIDAVIT AND INDEMNIFICATION AGREEMENT
FOR MISSING CERTIFICATE(S) OF OWNERSHIP
State of _____________
County of ____________
_____________________________________
_____________________________________
_____________________________________
_____________________________________ (The "Investor")
being duly sworn, deposes and says:
1. The Investor is of legal age and is the true and lawful, present and sole,
record and beneficial owner of _________ (insert number of interests) limited
partnership interests (the "Interests") of NTS-Properties VI, (the
"Partnership"). The Interests were represented by the following Certificate(s)
of Ownership (the "Certificate(s)") issued to the Investor:
Certificate(s) No. Number of Interests Date Issued
- ------------------ ------------------- -----------
The Certificate(s) was (were) lost, stolen, destroyed or misplaced under the
following circumstances:
________________________________________________________________________________
________________________________________________________________________________
____________________________________________________ and
after diligent search, the Certificate(s) could not be found.
2. Neither the Certificate(s) nor any interest therein has at any time been
sold, assigned, endorsed, transferred, pledged, deposited under any agreement or
other disposed of, whether or not for value, by or on behalf of the investor.
Neither the investor nor anyone acting on the Investor's behalf has at any time
signed any power of attorney, any stock power or other authorization with
respect to the Certificate(s) and no person or entity of any type other than the
Investor has or has asserted any right, title, claim or interest in or to the
Certificate(s) or to the Interests represented thereby.
3. The Investor hereby requests, and this Affidavit and Indemnification
Agreement is made and given in order to induce the Partnership, (i) to refuse to
recognize any person other than the Investor as the owner of the Certificate(s)
and to refuse to make any payment, transfer, registration, delivery or exchange
called for by the Certificate(s) to any person other than the Investor and to
refuse the Certificates or to make the payment, transfer, registration, delivery
or exchange called for by the Certificate(s) without the surrender thereof or
cancellation.
4. If the Investor or the representative or the assigns of the Investor should
find or recover the Certificate(s), the Investor will immediately surrender and
deliver the same to the Partnership for cancellation without requiring any
consideration thereof.
(Over)
<PAGE>
5. The Investor agrees in consideration of the issuance to the Investor of a new
certificate in substitution for the Certificate(s), to indemnify and hold
harmless the Partnership, each general partner of the Partnership, each
affiliate of the Partnership and any person, firm or corporation now or
hereafter acting as the transfer agent, registrar, trustee, depositary,
redemption, fiscal or paying agent of the Partnership, or in any other capacity
and their respective successors and assigns, from and against any and all
liabilities, losses, damages, costs and expenses of every nature (including
reasonable attorney's fees) in connection with, or arising out of, said lost,
stolen, destroyed or mislaid Certificate(s) without the surrender thereof and,
whether or not: (a) based upon or arising out of the honoring of, or refusing to
honor, the Certificate(s) when presented to anyone, (b) or based upon or arising
from inadvertence, accident, oversight or neglect on the part of the
Partnership, its affiliates or any general Partner of the Partnership, agents,
clerk, or employee of the Partnership or any general partner of the Partnership
and/or the omission or failure to inquire into contest or litigate the right of
any applicant to receive payment, credit, transfer, registration, exchange or
delivery in respect of the Certificate(s) and/or the new instrument or
instruments issued in lieu thereof, (c) and/or based upon or arising out of any
determination which the Partnership, its affiliates or any general partner
thereof may in fact makes as to the merits of any such claim, right, or title,
(d) and/or based upon or arising out of any fraud negligence on the part of the
Investor in connection with reporting the loss of the Certificate(s) and the
issuance of new instrument or instruments in lieu thereof, (e) and/or based upon
or arising out of any other matter or thing whatsoever it may be.
6. The Investor agrees that all notices, requests, demands and other
communications under this Affidavit and Indemnification Agreement shall be in
writing and shall be mailed to the party to whom notice is to be given by
certified or registered mail, postage prepaid; if intended for the Partnership
shall be addressed to Gemisys, 7103 S. Revere Pkwy., Englewood, CO 80112 Attn:
NTS Investor Services, or such other address as the Partnership shall have given
notice to the Investor at the address set forth at the end of this Affidavit and
Indemnification Agreement or at such other address as the Investor shall have
given prior notice to the Partnership in a manner herein provided.
7. No waiver shall be deemed to be made by the Partnership or its affiliates of
any of its rights hereunder unless the same shall be in writing, and each
waiver, if any, shall be a waiver only with respect to the specific instance
involved and shall in no way impair the rights of the Partnership or its
affiliates or the obligations of the Investor in any other respect at any other
time.
8. The provisions of this Affidavit and Indemnification Agreement shall be
binding upon and inure to the benefit of the successors and assigns of the
Partnership and its affiliates and the Investor.
9. This Affidavit and Indemnification Agreement shall be governed by and
construed in accordance with the laws of the State of Maryland.
-----------------------------------------------
Investor Signature (Please sign exactly as name
appears on certificate)
-----------------------------------------------
Investor Signature (if held jointly)
Sworn to me this ___ day -----------------------------------------------
of ______________, 199__. Name
- ----------------------------- -----------------------------------------------
Notary Public Address
My commission expires: __/__/__ -----------------------------------------------
365630
<PAGE>
Exhibit (a)(4)
Form of Letter to Limited Partners
31
<PAGE>
[NTS letterhead]
To our Limited Partners:
Enclosed for your consideration is an Offer to Purchase your limited
partnership interests. Please read all of the enclosed material carefully before
deciding to tender your interests. Your attention is invited to the following:
oThe purchase price per interest is $350.00.
oThe offer is being made to all Limited Partners.
oUp to 750 interests may be purchased by the Partnership and an additional 500
interests may be purchased by the Partnership's affiliate, ORIG, LLC. If more
than 1,250 interests are tendered, the Partnership may decide to purchase more
than 750 interests and the affiliate may decide to purchase more than 500
interests or the Partnership and the affiliate may decide to purchase less than
all of the interests tendered on a pro rata basis.
oThe offer and withdrawal rights will expire at 12:00 Midnight, Eastern Standard
Time, on Monday, January 18, 1999, unless the Offer is extended.
After reading the Offer to Purchase (white), if you wish to tender any or
all of your interests, complete and return to NTS Investors Services c/o Gemisys
the following:
(1) the Letter of Transmittal (blue);
(2) the Substitute Form W-9 (green); and
(3) the Certificate(s) of Ownership for the interests or,
if you are unable to locate the Certificate(s) of
Ownership, complete the Affidavit and Indemnification
Agreement for Missing Certificate(s) of Ownership
(yellow).
On or before the expiration of the Offer return or deliver all of the
above documents to:
NTS INVESTOR SERVICES
C/O GEMISYS
7103 S. REVERE PARKWAY
ENGLEWOOD, CO 80112
For additional information, call: (800) 387-7454
365592-3
<PAGE>
Exhibit (a)(5)
Substitute Form W-9 with Guidelines
32
<PAGE>
Substitute Form W-9
o Purpose of the Substitute Form W-9
Each tendering Limited Partner is required to provide to the
Partnership its correct Taxpayer Identification Number ("TIN") on Substitute
Form W-9 which is provided below, and to certify whether the Limited Partner is
subject to backup withholding of federal income tax. If the Partnership is not
provided with the correct TIN, the Limited Partner may be subject to a $500
penalty imposed by the Internal Revenue Service (the "IRS"). In addition,
failure to provide the information on Substitute Form W-9 may subject the
tendering Limited Partner to 31% federal income tax withholding on the payment
of the purchase price of all Interests purchased by the Offerors from the
Limited Partner pursuant to this Offer.
o Instructions for filling out the Substitute Form W-9
Each tendering Limited Partner must fill out the Substitute Form W-9
below by: (1) inserting their TIN; (2) certifying whether the Limited Partner is
subject to backup withholding of federal income tax; and (3) signing the form.
If the tendering Limited Partner is an individual, the TIN is the
Limited Partner's social security number.
If the tendering Limited Partner has been notified by the IRS that the
Limited Partner is subject to backup withholding, the Limited Partner must cross
out item (2) of the "Certification" box of Substitute Form W-9, unless the
Limited Partner has since been notified by the IRS that the Limited Partner is
no longer subject to backup withholding. If backup withholding applies, the
Partnership is required to withhold 31% of any payments made to the Limited
Partner. Backup withholding is not an additional tax. Rather, the tax liability
of persons subject to backup withholding will be reduced by the amount of tax
withheld. If withholding results in an overpayment of taxes, a refund may be
obtained from the IRS.
If the tendering Limited Partner has not been issued a TIN and has
applied for one or intends to apply for one in the near future, the Limited
Partner should write "Applied For" in the space provided for the TIN in Part I
of the Substitute Form W-9, and sign and date the Substitute Form W-9. If
"Applied For" is written in Part I and the Partnership is not provided with a
TIN within 60 days, the Partnership will withhold 31% on all payments of the
purchase price to the Limited Partner until a TIN is provided to the
Partnership.
Certain Limited Partners (including, among others, all corporations and
certain foreign individuals) are not subject to these backup withholding and
reporting requirements. In order for a foreign individual to qualify as an
exempt recipient, the individual must submit an Internal Revenue Form W-8,
signed under penalties of perjury, attesting to such individual's exempt status.
A Form W-8 may be obtained from NTS Investor Services c/o Gemisys at the address
and telephone number provided in Section 15, "Address; Miscellaneous" of the
Offer to Purchase.
For complete instructions on how to fill out Substitute Form W-9, refer
to the Guidelines enclosed.
(OVER)
<PAGE>
________________________________________________________________________________
SUBSTITUTE | Part I -- Taxpayer Identification |
FORM W-9 | Number -- For all accounts, enter | ___________________
| your TIN in the box at right. | Social Security No.
| (For most individuals, this is |
Department of the | your social security number.) |
Treasury | Certify by signing and dating | OR
Internal Revenue | below. |
Service | | ___________________
| | Employer
Payer's Request | | Identification No.
for Taxpayer | |
Identification | |
Number (TIN) | |
| | (If awaiting a TIN
| | write "Applied For"
| | in the space above).
____________________|___________________________________|_______________________
Part II -- For payees exempt from backup withholding, see the enclosed
Guidelines and complete as instructed therein.
________________________________________________________________________________
Certification -- Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct Taxpayer Identification Number
(or I am waiting for a number to be issued to me). and
(2) I am not subject to backup withholding either because (a) I am exempt from
backup withholding, (b) I have not been notified by the Internal Revenue Service
(the "IRS") that I am subject to backup withholding as a result of failure to
report all interest or dividends, or (c) the IRS has notified me that I am no
longer subject to backup withholding.
Certificate Instructions -- You must cross out item (2) above, if you have been
notified by the IRS that you are subject to backup withholding because of under
reporting interest or dividends on your tax return. However, if after being
notified by the IRS that you were subject to backup withholding you received
another notification from the IRS that you are no longer subject to backup
withholding, do not cross out item (2). (Also see instructions in the enclosed
Guidelines.)
________________________________________________________________________________
SIGNATURE __________________________________ DATE _________________ , 199 ____
________________________________________________________________________________
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
Guidelines for Determining the Proper Identification Number to Give the Payer. -
Social Security numbers have nine digits separated by two hyphens, e.g.,
000-00-0000. Employer identification numbers have nine digits separated by only
one hyphen, e.g., 00-0000000. The table below will help determine the number to
give the payer.
Give the SOCIAL
For this type of account: SECURITY
number of -
- ------------------------------------ --------------------------
1. An individual's account The individual
2. Two or more individuals The actual owner of
(joint account) the account or, if
combined funds, the
first individual on the
account(1)
3. Husband and wife (joint The actual owner of
account) the account or, if joint
funds, either person(1)
4. Custodian account of a The minor(2)
minor (Uniform Gift to Minors
Act)
5. Adult and minor (joint The adult or, if the
account) minor is the only
contributor, the
minor(1)
6. Account in the name of The ward, minor, or
guardian or committee for a incompetent person(3)
designated ward, minor, or
incompetent person
7. a. A revocable savings trust The grantor-trustee(1)
account (in which grantor
is also trustee)
b. Any "trust" account that The actual owner(1)
is not a legal or valid trust
under State law
Give the EMPLOYER
For this type of account: IDENTIFICATION
number of -
- ------------------------------------ --------------------------
8. Sole proprietorship account The owner(4)
9. A valid trust, estate, or The legal entity (do
pension trust not furnish the
identifying number of
the personal
representative or
trustee unless the
legal entity itself is not
designated in the
account title)(5)
10. Corporate account The corporation
11. Religious, charitable, or The organization
12. Partnership account held in The partnership
13. Association, club, or other The organization
14. A broker or registered The broker or nominee
15. Account with the Department The public entity
of Agriculture in the name of
a public entity (such as a
State or local government,
school district, or prison) that
receives agricultural program
payments
- ------------------------------------ --------------------------
(1) List first and circle the name of the person whose number you furnish.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Circle the ward's, minor's or incompetent person's name and furnish such
person's social security number.
(4) Show the name of the owner. If the owner does not have an employer
identification number, furnish the owner's social security number.
(5) List first and circle the name of the legal trust, estate or pension trust.
Note: If no name is circled when there is more than one name, the number will be
considered to be that of the first name listed.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
Page 2
Obtaining a Number
If you do not have a taxpayer identification number or you do not know your
number, obtain Form SS-5, Application for a Social Security Number Card (for
individuals), or Form SS-4, Application for Employer Identification Number (for
businesses and all other entities), at an office of the Social Security
Administration or the Internal Revenue Service.
To complete Substitute Form W-9, if you do not have a tax payer identification
number, write "Applied For" in the space for the taxpayer identification number
in Part 1, sign and date the Form, and give it to the requester. Generally, you
will then have 60 days to obtain a taxpayer identification number and furnish it
to the requester. If the requester does not receive your taxpayer identification
number within 60 days, backup withholding, if applicable, will begin and will
continue until you furnish your taxpayer identification number to the requester.
Payees Exempt from Backup Withholding Penalties
Payees specifically exempted from backup withholding on ALL payments include the
following:*
o A corporation.
o A financial institution.
o An organization exempt from tax under section 501(a), or an individual
retirement plan, or a custodial account under section 403(b)(7).
o The United States or any agency or instrumentality thereof.
o A State, the District of Columbia, a possession of the United States,
or any political subdivision or instrumentality thereof.
o A foreign government or a political subdivision, agency or
instrumentality thereof.
o An international organization or any agency or instrumentality
thereof.
o A registered dealer in securities or commodities registered in the
United States or a possession of the United States.
o A real estate investment trust.
o A common trust fund operated by a bank under section 584(a).
o An entity registered at all times during the tax year under the
Investment Company Act of 1940.
o A foreign central bank of issue.
Payments of dividends and patronage dividends not generally subject to backup
withholding include the following:
o Payments to nonresident aliens subject to withholding under section
1441.
o Payments to partnerships not engaged in a trade or business in the
United States and which have at least one nonresident partner.
o Payments of patronage dividends where the amount received is not paid
in money.
- ----------
* Unless otherwise noted herein, all references below to section numbers or to
regulations are references to the Internal Revenue Code and the regulations
promulgated thereunder.
o Payments made by certain foreign organizations.
o Payments made to a nominee.
Payments of interest not generally subject to backup withholding include the
following:
o Payments of interest on obligations issued by individuals. Note: You
may be subject to backup withholding if (i) this interest is $600 or
more, (ii) the interest is paid in the course of the payer's trade or
business and (iii) you have not provided your correct taxpayer
identification number to the payer.
o Payments of tax-exempt interest (including exempt interest dividends
under section 852).
o Payments described in section 6049(b)(5) to nonresident aliens.
o Payments on tax-free covenant bonds under section 1451.
o Payments made by certain foreign organizations.
o Payments made to a nominee.
Exempt payees described above should file a Substitute Form W-9 to avoid
possible erroneous backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH
YOUR TAXPAYER IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM,
SIGN AND DATE THE FORM AND RETURN IT TO THE PAYER.
Certain payments other than interest, dividends, and patronage dividends that
are not subject to information reporting are also not subject to backup
withholding. For details, see the regulations under sections 6041, 6041A(a),
6045, and 6050A.
Privacy Act Notice.- Section 6109 requires most recipients of dividends,
interest, or other payments to give taxpayer identification numbers to payers
who must report the payments to the IRS. The IRS uses the numbers for
identification purposes and to help verify the accuracy of your tax return.
Payers must be given the numbers whether or not recipients are required to file
tax returns. Payers must generally withhold 31% of taxable interest, dividends,
and certain other payments to a payee who does not furnish a taxpayer
identification number to a payer. Certain penalties may also apply.
Penalties
(1) Penalty for Failure to Furnish Taxpayer Identification Number.-If you fail
to furnish your taxpayer identification number to a payer, you are subject to a
penalty of $50 for each such failure unless your failure is due to reasonable
cause and not to willful neglect.
(2) Civil Penalty for False Statements With Respect to Withholding.-If you make
a false statement with no reasonable basis which results in no imposition of
backup withholding, you are subject to a penalty of $500. (3) Criminal
Penalty for Falsifying Information.-If you falsify certifications or
affirmations, you are subject to criminal penalties including fines and/or
imprisonment.
FOR ADDITIONAL INFORMATION
CONTACT YOUR TAX CONSULTANT OR THE
INTERNAL REVENUE SERVICE
