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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
[X] Filed by the Registrant
[ ] Filed by a party other than the Registrant
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only [as permitted by
Exchange Act Rule 14(a)-6(e)(2)]
[ ] Definitive Proxy Statement
[X] Definitive Additional Material
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
NORTHLAND CABLE PROPERTIES FIVE LIMITED PARTNERSHIP
(Name of Registrant as Specified in Its Charter)
Payment of Filing Fee:
[ ] No fee required.
[ ] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1) or
14a-6(i)(2), or Item 22(a)(2) ] of Schedule 14A.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11:
(1) Title of each class of securities to which transaction
applies: LIMITED PARTNERSHIP AND GENERAL PARTNERSHIP INTERESTS
(2) Aggregate number of securities to which transaction applies:
14,735 UNITS OF LIMITED PARTNERSHIP INTEREST (THE "UNITS") AND
ALL OF THE GENERAL PARTNERSHIP INTEREST
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the
amount on which filing fee is calculated and how determined):
approximately $773.92 PER UNIT AND $3,801,262.25 FOR THE
GENERAL PARTNERSHIP INTERESTS BASED UPON THE PROJECTED
PARTNERSHIP NET CASH VALUE OF $15,205,049 (75% OF WHICH IS
ATTRIBUTABLE TO THE UNITS AND 25% OF WHICH IS ATTRIBUTABLE TO
THE GENERAL PARTNERSHIP INTERESTS)
(4) Proposed maximum aggregate value of transaction: $15,205,049
(5) Total fee paid: $3,041
[X] Fee paid previously with written preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by
registration statement number, or the Form or Schedule and the date
of its filing:
(1) Amount previously paid:
(2) Form, schedule or registration statement number:
(3) Filing party:
(4) Date filed:
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NORTHLAND CABLE PROPERTIES FIVE LIMITED PARTNERSHIP
1201 THIRD AVENUE, SUITE 3600
SEATTLE, WASHINGTON 98101
June 16, 1998
TO: THE LIMITED PARTNERS OF NORTHLAND CABLE PROPERTIES FIVE LIMITED PARTNERSHIP
Dear Limited Partner:
We are writing this letter to inform you of a lawsuit that was recently
filed by one of the limited partners of Northland Cable Properties Five Limited
Partnership ("NCP-Five"). The suit, Paul J. Isaac v. Northland Communications
Corporation, FN Equities Joint Venture, FN Equities, Inc., John S. Whetzell,
John S. Simmers, Richard I. Clark and Northland Cable Properties Five Limited
Partnership, (Case No. 98-2-13464-0, filed June 3, 1998 in the Superior Court of
Washington in and for King County), was brought by Mr. Isaac and alleges breach
of fiduciary duty, violations of the Washington State Securities Act and
Washington Consumer Protection Act, and various other breaches. Among other
things, Mr. Isaac seeks the court's permission to establish a class action
consisting of all limited partners of NCP-Five certifying him as a
representative of the class, to enjoin NCP-Five from proceeding with,
consummating or closing the proposed sale to Northland Cable Properties, Inc.,
to seek damages for the alleged breaches, and to be reimbursed for his
attorneys' and experts' fees and expenses.
We at Northland believe that the claims brought by Mr. Isaac are totally
without merit and will vigorously defend this lawsuit. Indeed, we believe the
only parties truly damaged by this lawsuit are you, our limited partners, for
the inconvenience, delay and potentially significant legal fees and other costs
that this misguided action might cause. In particular, it appears that the
actions of Mr. Isaac and his lawyers will prevent us from closing the proposed
sale and distributing the first installment of the proceeds during July, 1998,
as we had originally intended.
For several months Northland has been working diligently for NCP-Five to
finalize the transaction as soon as possible after the scheduled June 25th
NCP-Five special meeting. To that end, Northland has arranged a financing
commitment from a lender, has allocated its internal personnel, and has retained
outside professionals to ensure the timely completion of this transaction.
Unfortunately, the filing of this lawsuit means the 95% of you who, as of
today, have voted in favor of the proposed transaction will not be receiving
the anticipated initial cash distributions for several months or perhaps
longer (representing approximately 74% of the outstanding limited partnership
units). We also note that less than 3% of limited partners to date have voted
against the proposed transaction (representing approximately 2% of the
outstanding limited partnership units).
While we expect Mr. Isaac's claims to be dismissed in a summary fashion,
the court could take a year or longer to reach a final decision. If Mr. Isaac
ultimately were to prevail, NCP-Five may have to undertake several
time-consuming and costly steps to effect the sale of the partnership's assets
including obtaining an additional fairness opinion from an independent financial
advisor and soliciting third party bids. Selecting a broker (who will charge a
substantial fee) and identifying interested, qualified buyers may take between
three months and one year. Following that, third party transactions generally
take nine to 18 months to complete and involve the negotiation of purchase and
sale agreements, the completion of due diligence, the receipt of required
consents, and the expiration of a post-closing period before all proceeds can be
disbursed. Because of the geographical locations of NCP-Five's systems, finding
a single buyer may be difficult. Consequently, in a multiple buyer situation,
the time needed for completion as well as the legal and other transaction costs
may be increased significantly. Other details of closing such as disbursal of
funds also become more complicated. Because of the potential for lengthy delay
in closing the proposed transaction, we are looking into the likelihood of
having to contact you again to obtain your proxy to extend the dissolution date
of NCP-Five's partnership for approximately five more years, or until December
31, 2006, as we investigate these matters further.
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Again, we understand the significant inconvenience to you that has been
brought about by this lawsuit. Northland is confident the court will see
plaintiff's claims as without merit and that we will be able to fulfill the
mandate of the approximately 70% of the limited partners who, to date, have
voted in favor of the proposal detailed in the Proxy Statement. We are
optimistic the proposed transaction can be completed within the next 60 to 90
days.
Very truly yours,
NORTHLAND CABLE PROPERTIES FIVE
LIMITED PARTNERSHIP
By: Northland Communications Corporation,
Managing General Partner
By: /s/ JOHN S. WHETZELL
John S. Whetzell, President
