<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
- --------------------------------------------------------------------------------
Schedule 14D-1
Tender Offer Statement Pursuant to Section 14(d)(1)
of the Securities Exchange Act of 1934
(AMENDMENT NO. 3)
- --------------------------------------------------------------------------------
PROMETHEUS INCOME PARTNERS
(Name of Subject Company)
PROM INVESTMENT PARTNERS L.L.C.
(Bidder)
UNITS OF LIMITED PARTNERSHIP INTEREST
(Title of Class
of Securities)
742941 10 7
(CUSIP Number of Class
of Securities)
- --------------------------------------------------------------------------------
W. Edward Scheetz
Prom Investment Partners L.L.C.
1301 Avenue of the Americas, 38th Floor
New York, NY 10019
Copy to:
Peter M. Fass
Steven L. Lichtenfeld
Battle Fowler LLP
75 East 55th Street
New York, NY 10022
(212) 856-7000
(Name, Address and Telephone Number of
Person Authorized to Receive Notices and
Communications on Behalf of Bidder)
Calculation of Filing Fee
- --------------------------------------------------------------------------------
Transaction Amount of
Valuation* Filing Fee
- -------------------------- --------------------------
$4,320,000 $864.00
- --------------------------------------------------------------------------------
*For purposes of calculating the filing fee only. This amount
assumes the purchase of 9,000 units of limited partnership interest ("Units")
of the subject company for $480 per Unit in cash.
[X] Check box if any part of the fee is offset as provided by Rule
0-11(a)(2) and identify the filing with which the offsetting
fee was previously paid. Identify the previous filing by
registration statement number, or the Form or Schedule and
date of its filing.
Amount previously paid: 855.00
Form or registration no.: Schedule 14D-1
Filing party: Prom Investment Partners L.L.C.
Date filed: October 18, 1996
(Continued on following pages)
(Page 1 of 6 pages)
<PAGE> 2
Cusip No.: 742941 10 7 14D-1 Page 2 of 6
- --------------------------------------------------------------------------------
1. Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
PROM INVESTMENT PARTNERS L.L.C.
- --------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group
(See Instructions)
(a) [ ]
(b) [ ]
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3. SEC Use Only
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4. Sources of Funds (See Instructions)
AF; WC
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5. Check Box if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(e) or 2(f)
[ ]
- --------------------------------------------------------------------------------
6. Citizenship or Place of Organization
Delaware
- --------------------------------------------------------------------------------
7. Aggregate Amount Beneficially Owned by Each Reporting Person
5 Units of Limited Partnership Interest
- --------------------------------------------------------------------------------
8. Check Box if the Aggregate Amount in Row (7) Excludes
Certain Shares (See Instructions)
[ ]
- --------------------------------------------------------------------------------
9. Percent of Class Represented by Amount in Row (7)
Less than 1%
- --------------------------------------------------------------------------------
10. Type of Reporting Person (See Instructions)
OO
<PAGE> 3
AMENDMENT NO. 3 TO SCHEDULE 14D-1
This Amendment No. 3 amends the Tender Offer Statement on Schedule
14D-1 filed by Prom Investment Partners L.L.C., a Delaware limited liability
company (the "Purchaser"), with the Securities and Exchange Commission on
October 18, 1996, as amended by Amendment No. 1 filed on November 12, 1996 and
Amendment No. 2 filed on November 27, 1996, relating to the tender offer by the
Purchaser to purchase up to 9,000 of the issued and outstanding units of
limited partnership interest ("Units") of Prometheus Income Partners, a
California limited partnership (the "Partnership"), to include the information
set forth below. Terms not otherwise defined herein shall have the meaning
ascribed to them in the Schedule 14D-1 and the Offer to Purchase.
ITEM 1. SECURITY AND SUBJECT COMPANY.
Item 1(b) is hereby supplemented and amended as follows:
The information set forth in the Introduction to the Supplement to the
Offer to Purchase, a copy of which is attached hereto as Exhibit (a)(12) (the
"Supplement"), is incorporated herein in its entirety by reference.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY.
Item 3(b) is hereby supplemented and amended as follows:
The information set forth in Section 11 ("Background of the Offer") of
the Supplement is incorporated herein in its entirety by reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Item 4(a) is hereby amended as follows:
The information set forth in Section 12 ("Source of Funds") of the
Supplement is incorporated herein in its entirety by reference.
ITEM 10. ADDITIONAL INFORMATION.
Item 10(f) is hereby supplemented and amended as follows:
The information set forth in the letter to Limited Partners, the
Supplement, the Letter of Transmittal, the Notice of Withdrawal and the press
release dated December 5, 1996, copies of which are attached hereto as Exhibits
(a)(11), (a)(12), (a)(13), (a)(14) and (a)(15), respectively, is incorporated
herein in its entirety by reference.
3
<PAGE> 4
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
Item 11 is hereby supplemented and amended by adding the following,
copies of which are attached hereto as exhibits:
99.(a)(11) Letter, dated December 5, 1996, from Prom Investment Partners
L.L.C. to holders of Units.
99.(a)(12) Supplement to Offer to Purchase dated December 5, 1996.
99.(a)(13) Letter of Transmittal.
99.(a)(14) Notice of Withdrawal.
99.(a)(15) Press Release dated December 5, 1996.
4
<PAGE> 5
SIGNATURES
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.
Dated: December 5, 1996
PROM INVESTMENT PARTNERS L.L.C.
By: AP-GP Prom Partners Inc.,
its managing member
By: /s/ Richard Mack
----------------------------------
Name: Richard Mack
Title: Vice President
5
<PAGE> 6
EXHIBIT INDEX
EXHIBIT NO. TITLE
- ----------- -----
99.(a)(11) Letter, dated December 5, 1996, from Prom Investment Partners
L.L.C. to holders of Units
99.(a)(12) Supplement to Offer to Purchase dated December 5, 1996
99.(a)(13) Letter of Transmittal
99.(a)(14) Notice of Withdrawal
99.(a)(15) Press Release dated December 5, 1996
6
<PAGE> 1
PROM INVESTMENT PARTNERS L.L.C.
1301 AVENUE OF THE AMERICAS
38TH FLOOR
NEW YORK, NY 10019
December 5, 1996
$480
OFFER PRICE TO PURCHASE UNITS OF
PROMETHEUS INCOME PARTNERS
OFFER EXTENDED TO FRIDAY, DECEMBER 20, 1996
Dear Limited Partners:
Prom Investment Partners L.L.C. has increased its offer to
purchase Units of Prometheus Income Partners (the "Partnership") to $480 PER
UNIT. This price exceeds the offer (the "Affiliated Tender Offer") made by PIP
Partners-General LLC ("PIP"), an affiliate of Sanford N. Diller and the general
partner of the Partnership.
o $480 IS THE HIGHEST PRICE. OUR OFFER IS HIGHER THAN THE OFFER
MADE BY THE GENERAL PARTNER'S AFFILIATE.
o YOU CAN REVOKE YOUR PRIOR TENDER TO PIP, WHICH WAS FOR LESS
MONEY. If you have already tendered your Units to PIP but
would like to receive more money per Unit pursuant to our
Offer, we have enclosed a Notice of Withdrawal so that you can
withdraw your prior acceptance of PIP's offer.
o LIQUIDITY NOW, NO COMMISSIONS AND NO TRANSFER FEES. NO MORE
K-1 REPORTING COSTS. Our Offer provides you with cash now! If
you sell all of your Units, you will also avoid the expense,
delay, and complications in filing complex tax returns which
result from an ownership of Units.
o OUR OFFER CURRENTLY EXPIRES ON FRIDAY, DECEMBER 20, 1996.
IN THE EVENT YOU HAVE ALREADY TENDERED YOUR UNITS TO PIP BUT
WOULD LIKE TO RECEIVE MORE MONEY PER UNIT PURSUANT TO OUR OFFER, WE HAVE
ENCLOSED A NOTICE OF WITHDRAWAL SO THAT YOU CAN WITHDRAW YOUR PRIOR ACCEPTANCE
OF PIP'S OFFER. In the event you receive any other offers, please contact The
Herman Group at (800) 992-6176 before signing any documentation. IF YOU
PREVIOUSLY TENDERED YOUR UNITS TO US, YOU WILL AUTOMATICALLY RECEIVE THE HIGHER
PRICE WITHOUT TAKING ANY FURTHER ACTION. If you have not yet tendered your
Units to us (or have now withdrawn your acceptance of PIP's offer and would
like to tender to us), please mail or fax a completed and executed copy of the
enclosed Letter of Transmittal and any documents required by the Letter of
Transmittal to The Herman Group using the enclosed pre-addressed, postage paid
envelope at the address listed below. If you have any questions or comments,
please call The Herman Group at (800) 992-6176.
THE HERMAN GROUP, INC.
2121 San Jacinto Street, 26th Floor
Dallas, Texas 75201
Facsimile No. (214) 999-9348 or (214) 999-9323
For information call 1-800-992-6176
PROM INVESTMENT PARTNERS L.L.C.
<PAGE> 1
SUPPLEMENT TO THE
OFFER TO PURCHASE FOR CASH
UP TO 9,000 UNITS OF LIMITED PARTNERSHIP INTEREST
of
PROMETHEUS INCOME PARTNERS
at
$480 NET PER UNIT OF LIMITED PARTNERSHIP INTEREST
by
PROM INVESTMENT PARTNERS L.L.C.
***************************************************************************
* *
* THE OFFER, WITHDRAWAL RIGHTS AND PRORATION PERIOD WILL EXPIRE AT *
* 12:00 MIDNIGHT, NEW YORK CITY TIME, ON DECEMBER 20, 1996, UNLESS *
* EXTENDED. *
* *
***************************************************************************
The Purchaser hereby supplements and amends its offer to purchase up
to 9,000 Units of Prometheus Income Partners, upon the terms and subject to the
conditions set forth in the Offer to Purchase dated October 18, 1996, as
supplemented and amended, this Supplement and the related Letter of
Transmittal, as each may be amended from time to time. Capitalized terms used
but not otherwise defined in this Supplement shall have the meanings ascribed
to them in the Offer to Purchase.
INTRODUCTION
The "Introduction" to the Offer to Purchase is hereby supplemented and
amended as follows:
The Purchaser hereby amends the Offer to increase the Purchase Price
to $480 per Unit, net to the seller in cash, without interest thereon, less the
aggregate amount of any distributions per Unit declared or made by the
Partnership after October 18, 1996 and the date of payment of the purchase
price for the Units by the Purchaser, upon the terms and subject to the
conditions set forth in the Offer to Purchase and the related Letter of
Transmittal, as each may be supplemented or amended from time to time.
________________________________
THIS OFFER REPRESENTS AN INCREASE OVER THE OFFER MADE BY PIP PURSUANT TO THE
AFFILIATED TENDER OFFER.
________________________________
FOR THE CONVENIENCE OF LIMITED PARTNERS DESIRING TO WITHDRAW FROM THE
AFFILIATED TENDER OFFER AND ACCEPT THE $480 PER UNIT OFFERED HEREBY, A FORM OF
"NOTICE OF WITHDRAWAL" IS ENCLOSED WHICH, IF PROPERLY DELIVERED TO IBJ SCHRODER
BANK & TRUST COMPANY, DEPOSITARY AGENT FOR THE AFFILIATED TENDER OFFER, WILL
ENABLE LIMITED PARTNERS TO WITHDRAW UNITS TENDERED PURSUANT TO THE AFFILIATED
TENDER OFFER.
________________________________
THE TENDER OFFER
SECTION 1. TERMS OF THE OFFER.
Section 1 of the Offer to Purchase is hereby supplemented and amended
as follows:
The term "Expiration Date" shall mean 12:00 midnight, New York City
time, on December 20, 1996, unless the Purchaser, in its sole discretion, shall
have further extended the period of time during which the Offer is open, in
which event the term "Expiration Date" shall refer to the latest time and date
at which the Offer, as so extended by the Purchaser, will expire.
<PAGE> 2
SECTION 11. BACKGROUND OF THE OFFER.
Section 11 of the Offer to Purchase is hereby supplemented and amended
as follows:
On November 12, 1996, the Partnership withdrew its motion for a
temporary restraining order and for expedited discovery in connection with the
Partnership's lawsuit against the Purchaser titled Prom Income Partners v. Prom
Investment Partners L.L.C., AP-GP Prom Partners Inc., et al. On November 22,
1996, the Partnership and the Purchaser entered into an agreement providing
that the Purchaser's time to answer the Partnership's complaint was extended
until five business days after the Purchaser's counsel receives written notice
from the Partnership's counsel demanding service of an answer to the
Partnership's complaint. The Purchaser continues to maintain that the
Partnership's action is without merit and will vigorously defend itself.
Since November 18, 1996, PIP, the Partnership and the Purchaser have
discussed elements of a possible settlement agreement of the pending litigation
between the Partnership and the Purchaser, which settlement may have included,
among other things, a possible joint tender offer by PIP and the Purchaser for
Units. On November 27, 1996, the Purchaser amended the Offer to extend its
expiration to 12:00 Midnight, New York City time, on December 4, 1996. On
December 4, 1996, the Purchaser determined that a settlement acceptable to it
would not be reached at this time and terminated all discussions with the
Partnership and PIP regarding a settlement of this litigation. No further
settlement discussions are scheduled between PIP, the Partnership and the
Purchaser.
On November 26, 1996, a derivative and class action lawsuit was filed
by J/B Investment Partners, on behalf of all Limited Partners of the
Partnership, in California Superior Court for the County of Santa Clara (the
"Limited Partner Class Action Lawsuit") against the General Partner, PIP,
Sanford N. Diller, Vicki R. Mullins, John Murphy and certain entities
affiliated with the foregoing (collectively, the "Defendants"). According to
the Limited Partner Class Action Lawsuit, Ms. Mullins and Mr. Murphy are
officers and directors of the General Partner and are the sole members of the
Partnership's Special Committee. The Limited Partner Class Action Lawsuit
alleges, among other things, that: (i) Mr. Diller, Ms. Mullins and Mr. Murphy
have exercised their control of the Partnership to pursue "a common plan and
scheme by which they have and are continuing to waste and misappropriate
hundreds of thousands of dollars of Partnership assets"; (ii) the Special
Committee is not independent and "is flawed in that it consists only of two
employees of the General Partner and its affiliates", Ms. Mullins and Mr.
Murphy; (iii) the Defendants breached their fiduciary duties to the Partnership
and the Limited Partners; (iv) the Defendants breached the Partnership
Agreement; and (v) the General Partner and PIP have been unjustly enriched. To
date, the Partnership has not disclosed in its public filings the Limited
Partner Class Action Lawsuit.
SECTION 12. SOURCE OF FUNDS.
Section 12 of the Offer to Purchase is hereby amended as follows:
The Purchaser expects that approximately $4,320,000 (exclusive of fees
and expenses) would be required to purchase all of the Units sought pursuant to
the Offer, if tendered. The Purchaser presently contemplates that it will
obtain all of such funds from capital contributions from its members who have
an aggregate net worth substantially in excess of the amount required to
purchase the Units. One of the Purchaser's members, Apollo Real Estate
Investment Fund II, L.P., has capital commitments from institutional and other
investors for aggregate amounts that exceed $500 million. However, the
Purchaser may seek to obtain debt financing to facilitate the purchase of
Units, but no commitment has been obtained for any such debt financing.
Prom Investment Partners L.L.C.
December 5, 1996
<PAGE> 1
LETTER OF TRANSMITTAL
TO
TENDER UNITS OF LIMITED PARTNERSHIP INTEREST
OF
PROMETHEUS INCOME PARTNERS
PURSUANT TO THE OFFER TO PURCHASE DATED OCTOBER 18, 1996, AS
SUPPLEMENTED AND AMENDED,
BY
PROM INVESTMENT PARTNERS L.L.C.
<TABLE>
<CAPTION>
Number of(*) Purchase Price
Units Tendered Per Unit
-------------- --------------
<S> <C> <C>
$480
</TABLE>
Please indicate changes or corrections to the address printed above.
(*) If no indication is marked above, all Units issued will be deemed to have
been tendered.
================================================================================
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT MIDNIGHT, NEW
YORK CITY TIME, ON FRIDAY, DECEMBER 20, 1996 (THE "EXPIRATION DATE") UNLESS
SUCH OFFER IS EXTENDED.
The undersigned hereby tender(s) to Prom Investment Partners L.L.C., a
Delaware limited liability company (the "Purchaser"), the number of units of
limited partnership interest ("Units") of Prometheus Income Partners, a
California limited partnership (the "Partnership"), specified above, pursuant
to the Purchaser's offer to purchase up to 9,000 of the issued and outstanding
Units at a purchase price of $480 per Unit, net to the seller in cash (the
"Purchase Price"), without interest thereon, upon the terms and subject to the
conditions set forth in the Offer to Purchase dated October 18, 1996, as
supplemented and amended (the "Offer to Purchase"), and this Letter of
Transmittal (the "Letter of Transmittal", which, together with the Offer to
Purchase and any supplements, modifications or amendments thereto, constitute
the "Offer"), all as more fully described in the Offer to Purchase. The
Purchase Price will be automatically reduced by the aggregate amount of
distributions per Unit, if any, made or declared by the Partnership after
October 18, 1996 and on or prior to 12:00 midnight, New York City time, on
December 20, 1996 (the "Expiration Date"). In addition, if a distribution is
made or declared after the Expiration Date but prior to the date on which the
Purchaser pays the Purchase Price for the tendered Units, the Purchaser will
offset the amount otherwise due a holder of Units pursuant to the Offer in
respect of tendered Units which have been accepted for payment but not yet paid
for by the amount of any such distribution. LIMITED PARTNERS WHO TENDER THEIR
UNITS WILL NOT BE OBLIGATED TO PAY ANY COMMISSIONS OR PARTNERSHIP TRANSFER
FEES, WHICH COMMISSIONS OR PARTNERSHIP TRANSFER FEES WILL BE BORNE BY THE
PURCHASER. Receipt of the Offer to Purchase is hereby acknowledged.
Capitalized terms used but not defined herein have the respective meanings
ascribed to them in the Offer to Purchase.
By executing and delivering this Letter of Transmittal, a tendering Limited
Partner irrevocably appoints the Purchaser and designees of the Purchaser and
each of them as such Limited Partner's proxies, with full power of
substitution, in the manner set forth in this Letter of Transmittal to the full
extent of such Limited Partner's rights with respect to the Units tendered by
such Limited Partner and accepted for payment by the Purchaser (and with
respect to any and all other Units or other securities issued or issuable in
respect of such Unit on or after the date hereof). All such proxies shall be
considered irrevocable and coupled with an interest in the tendered Units.
Such appointment will be effective when, and only to the extent that, the
Purchaser accepts such Units for payment. Upon such acceptance for payment,
all prior proxies given by such Limited Partner with respect to such Units (and
such other Units and securities) will be revoked without further action, and no
subsequent proxies may be given nor any subsequent written consent executed
(and, if given or executed, will not be deemed effective). The Purchaser and
its designees will, with respect to the Units (and such other Units and
securities) for which such appointment is effective, be empowered to exercise
all voting and other rights of such Limited Partner as they in their sole
discretion may deem proper at any meeting of Limited Partners or any
adjournment or postponement thereof, by written consent in lieu of any such
meeting or otherwise. The Purchaser reserves the right to require that, in
order for a Unit to be deemed validly tendered, immediately upon the
Purchaser's payment for such Unit, the Purchaser must be able to exercise full
voting rights with respect to such Unit and other securities, including voting
at any meeting of Limited Partners.
By executing and delivering the Letter of Transmittal, a tendering Limited
Partner also irrevocably constitutes and appoints the Purchaser and its
designees as the Limited Partner's attorneys-in-fact, each with full power of
substitution to the extent of the Limited Partner's rights with respect to the
Units tendered by the Limited Partner and accepted for payment by the
Purchaser. Such appointment will be effective when, and only to the extent
that, the Purchaser accepts the tendered Units for payment. Upon such
acceptance for payment, all prior powers of attorney granted by the Limited
Partner with respect to such Unit will, without further action, be revoked, and
no subsequent powers of attorney may be granted (and if granted will not be
effective). Pursuant to such appointment as attorneys-in- fact, the Purchaser
and its designees each will have the power, among other things, (i) to seek to
transfer ownership of such Units on the Partnership books maintained by the
transfer agent and registrar for the Partnership (and execute and deliver any
accompanying evidences of transfer and authenticity any of them may deem
necessary or appropriate in connection therewith), (ii) upon receipt by the
Information Agent/Depositary (as the tendering Limited Partner's agent) of the
Purchase Price, to become a substitute Limited Partner, to receive any and all
distributions made by the Partnership after the Expiration Date, and to receive
all benefits and otherwise exercise all rights of beneficial ownership of such
Units in accordance with the terms of the Offer, (iii) to execute and deliver
to the general partner of the Partnership (the "General Partner") a change of
address form instructing the General Partner to send any and all future
distributions to which the Purchaser is entitled pursuant to the terms of the
Offer in respect of tendered Units to the address specified in such form and
(iv) to endorse any check payable to or upon the order of such Limited Partner
representing a distribution to which the Purchaser is entitled pursuant to the
terms of the Offer, in each case on behalf of the tendering Limited Partner.
If legal title to the Units is held through an IRA or KEOGH or similar
account, the Limited Partner understands that this Agreement must be signed by
the custodian of such IRA or KEOGH account and the Limited Partner hereby
authorizes and directs the custodian of such IRA or KEOGH to confirm this
Agreement. This Power of Attorney shall not be affected by the subsequent
mental disability of the Limited Partner, and the Purchaser shall not be
required to post bond in any nature in connection with this Power of Attorney.
By executing and delivering the Letter of Transmittal, a tendering Limited
Partner irrevocably assigns to the Purchaser and its assigns all of the right,
title and interest of such Limited Partner in the Partnership with respect to
the Units tendered and purchased pursuant to the Offer, including, without
limitation, such Limited Partner's right, title and interest in and to any and
all distributions made by the Partnership after the Expiration Date in respect
of the Units tendered by such Limited Partner and accepted for payment by the
Purchaser, regardless of the fact that the record date for any such
distribution may be a date prior to the Expiration Date. The Purchaser will
seek to be admitted to the Partnership as a substitute Limited Partner upon
consummation of the Offer.
By executing this Letter of Transmittal, the undersigned represents that
either (a) the undersigned is not a plan subject to Title I of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") or Section 4975 of
the Internal Revenue Code of 1986, as amended (the "Code"), or an entity deemed
to hold "plan assets" within the meaning of 29 C.F.R. Section 2510.3-101 of any
such plan; or (b) the tender and acceptance of Units pursuant to the Offer will
not result in a nonexempt prohibited transaction under Section 406 of ERISA or
Section 4975 of the Code.
The undersigned recognizes that, if proration is required pursuant to the
terms of the Offer, the Purchaser will accept for payment from among those
Units validly tendered on or prior to the Expiration Date and not properly
withdrawn, the maximum number of Units permitted pursuant to the Offer on a pro
rata basis, with adjustments to avoid purchases of certain fractional Units,
based upon the number of Units validly tendered prior to the Expiration Date
and not properly withdrawn.
The undersigned understands that a tender of Units to the Purchaser will
constitute a binding agreement between the undersigned and the Purchaser upon
the terms and subject to the conditions of the Offer. The undersigned
recognizes that under certain circumstances set forth in Section 2 ("Proration;
Acceptance for Payment and Payment for Units") and Section 14 ("Conditions of
the Offer") of the Offer to Purchase, the Purchaser may not be required to
accept for payment any of the Units tendered hereby. In such event, the
undersigned understands that any Letter of Transmittal for Units not accepted
for payment will be destroyed by the Purchaser. Except as stated in Section 4
("Withdrawal Rights") of the Offer to Purchase, this tender is irrevocable,
provided Units tendered pursuant to the Offer may be withdrawn at any time
prior to the Expiration Date.
<PAGE> 2
================================================================================
SIGNATURE BOX
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Please sign exactly as your name is printed (or X
corrected) above. For joint owners, each joint owner --------------------------------------------------------
must sign. If signed by the registered holder(s) of the (Signature of Owner) (Date)
Units and payment is to be made directly to that
holder(s) or Eligible Institution, then no signature X
guarantee is necessary. In all other cases, all --------------------------------------------------------
signatures must be guaranteed by an Eligible Taxpayer Identification Number of Owner (other
Institution. (See Instruction 2.) The signatory hereto than IRA's)
hereby certifies under penalties of perjury the Taxpayer
Identification Number furnished in the blank provided in X
this Signature Box and the statements in Box A, Box B --------------------------------------------------------
and, if applicable, Box C. The undersigned hereby (Signature of Co-Owner) (Date)
represents and warrants for the benefit of the
Partnership and the Purchaser that the undersigned owns
the Units tendered hereby and has full power and ---------------------------------------------------------
authority to validly tender, sell, assign, transfer, (Title)
convey and deliver the Units tendered hereby and that
when the same are accepted for payment by the Purchaser, Telephone (Day) ( )
the Purchaser will acquire good, marketable and -----------------------------------------
unencumbered title thereto, free and clear of all liens, Telephone (Eve) ( )
restrictions, charges, encumbrances, conditional sales -----------------------------------------
agreements or other obligations relating to the sale or
transfer thereof, and such Units will not be subject to GUARANTEE OF SIGNATURE (IF REQUIRED. SEE INSTRUCTION 2)
any adverse claims and that the transfer and assignment
contemplated herein are in compliance with all Name of Eligible Institution:
applicable laws and regulations. All authority herein ----------------------------
conferred or agreed to be conferred shall survive the
death or incapacity of the undersigned and any Authorized Signature:
obligations of the undersigned shall be binding upon the ------------------------------------
heirs, personal representatives, successors and assigns
of the undersigned. Except as stated in Section 4
("Withdrawal Rights") of the Offer to Purchase, this
tender is irrevocable.
</TABLE>
================================================================================
TAX CERTIFICATIONS
================================================================================
BOX A
SUBSTITUTE FORM W-9
(See Instruction 3)
The person signing this Letter of Transmittal hereby certifies the following
to the Purchaser under penalties of perjury:
(i) The Taxpayer Identification Number ("TIN") furnished in the space
provided for that purpose in the Signature Box of this Letter of Transmittal
is the correct TIN of the Limited Partner, unless the Units are held in an
Individual Retirement Account ("IRA"); or if this box [ ] is checked, the
Limited Partner has applied for a TIN. If the Limited Partner has applied
for a TIN, a TIN has not been issued to the Limited Partner, and either: (a)
the Limited Partner has mailed or delivered an application to receive a TIN
to the appropriate Internal Revenue Service ("IRS") Center or Social Security
Administration Office, or (b) the Limited Partner intends to mail or deliver
an application in the near future, it is hereby understood that if the
Limited Partner does not provide a TIN to the Purchaser within sixty (60)
days, 31% of all reportable payments made to the Limited Partner thereafter
will be withheld until a TIN is provided to the Purchaser; and
(ii) Unless this box [ ] is checked, the Limited Partner is not subject to
backup withholding either because the Limited Partner: (a) is exempt from
backup withholding, (b) has not been notified by the IRS that the Limited
Partner is subject to backup withholding as a result of a failure to report
all interest or dividends, or (c) has been notified by the IRS that such
Limited Partner is no longer subject to backup withholding.
Note: Place an "X" in the box in (ii) above, if you are unable to certify
that the Limited Partner is not subject to backup withholding.
================================================================================
================================================================================
BOX B
FIRPTA AFFIDAVIT
(See Instruction 3)
Under Section 1445(c)(5) of the Code and Treas. Reg. 1.1445-IIT(d), a
transferee must withhold tax equal to 10% of the amount realized with respect
to certain transfers of an interest in a partnership if 50% or more of the
value of its gross assets consists of U.S. real property interests and 90% or
more of the value of its gross assets consists of U.S. real property
interests plus cash or cash equivalents, and the holder of the partnership
interest is a foreign person. To inform the Purchaser that no withholding is
required with respect to the Limited Partner's interest in the Partnership,
the person signing this Letter of Transmittal hereby certifies the following
under penalties of perjury:
(i) Unless this box [ ] is checked, the Limited Partner, if an individual,
is a U.S. citizen or a resident alien for purposes of U.S. income taxation,
and if other than an individual, is not a foreign corporation, foreign
partnership, foreign trust or foreign estate (as those terms are defined in
the Code and Income Tax Regulations);
(ii) the Limited Partner's U.S. social security number (for individuals) or
employer identification number (for non-individuals) is correct as furnished
in the blank provided for that purpose on the back of this Letter of
Transmittal; and
(iii) the Limited Partner's home address (for individuals), or office
address (for non-individuals), is correctly printed (or corrected) on the
back of this Letter of Transmittal. If a corporation, the jurisdiction of
incorporation is _________________________.
The person signing this Letter of Transmittal understands that this
certification may be disclosed to the IRS by the Purchaser and that any false
statements contained herein could be punished by fine, imprisonment, or both.
================================================================================
================================================================================
BOX C
SUBSTITUTE FORM W-8
(See Instruction 3)
By checking this box [ ], the person signing this Letter of Transmittal
hereby certifies under penalties of perjury that the Limited Partner is an
"exempt foreign person" for purposes of the backup withholding rules under
U.S. federal income tax laws, because the Limited Partner:
(i) Is a nonresident alien or a foreign corporation, partnership, estate or
trust;
(ii) If an individual, has not been and plans not to be present in the U.S.
for a total of 183 days or more during the calendar year; and
(iii) Neither engages, nor plans to engage, in a U.S. trade or business that
has effectively connected gains from transactions with a broker or barter
exchange.
================================================================================
For Units to be accepted for purchase, Limited Partners should complete and
sign this Letter of Transmittal in the Signature Box and return it in the
self-addressed, postage-paid envelope enclosed, or by hand or overnight courier
to: The Herman Group, Inc., 2121 San Jacinto Street, 26th Floor, Dallas, TX
75201, or by Facsimile to: (214) 999-9323 or (214) 999-9348. Delivery of this
Letter of Transmittal or any other required documents to an address other than
the one set forth above or transmission via facsimile other than as set forth
above does not constitute valid delivery.
PLEASE CAREFULLY READ THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF
TRANSMITTAL AND BOXES A, B AND C ABOVE.
<PAGE> 3
INSTRUCTIONS FOR COMPLETING LETTER OF TRANSMITTAL
Forming Part of the Terms and Conditions of the Offer
================================================================================
FOR ASSISTANCE IN COMPLETING THE LETTER OF
TRANSMITTAL, CALL: THE HERMAN GROUP,
INC. AT (800) 992-6176
================================================================================
1. DELIVERY OF LETTER OF TRANSMITTAL. For convenience in responding to
the Offer, a self-addressed, postage-paid envelope had been enclosed
with the Offer to Purchase. However, to ensure receipt of the Letter
of Transmittal, it is suggested that you use an overnight courier or,
if the Letter of Transmittal is to be delivered by United States mail,
that you use certified or registered mail, return receipt requested.
To be effective, a duly completed and signed Letter of Transmittal (or
facsimile thereof) must be received by the Information
Agent/Depositary at the address (or facsimile number) set forth below
before the Expiration Date, 12:00 Midnight, New York City Time on
Friday, December 20, 1996, unless extended. LETTERS OF TRANSMITTAL
WHICH HAVE BEEN DULY EXECUTED, BUT WHERE NO INDICATION IS MARKED IN
THE "NUMBER OF UNITS TENDERED" COLUMN, SHALL BE DEEMED TO HAVE
TENDERED ALL UNITS PURSUANT TO THE OFFER. Tenders of fractional Units
will only be accepted if all of the Units held by such Limited Partner
are tendered.
BY MAIL/HAND OR OVERNIGHT DELIVERY: THE HERMAN GROUP, INC.
2121 San Jacinto Street,
26th Floor
Dallas, Texas 75201
BY FACSIMILE: (214) 999-9323
or
(214) 999-9348
FOR ADDITIONAL INFORMATION CALL: (800) 992-6176
THE METHOD OF DELIVERY OF THE LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED
DOCUMENTS IS AT THE OPTION AND SOLE RISK OF THE TENDERING LIMITED PARTNER, AND
THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE INFORMATION
AGENT/DEPOSITARY. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE
TIMELY DELIVERY. IF TENDERING BY FACSIMILE, PLEASE TRANSMIT BOTH THE FRONT AND
BACK OF THE LETTER OF TRANSMITTAL AND THE TAX CERTIFICATION PAGE AND MAIL THE
ORIGINAL COPIES OF SUCH PAGES TO THE INFORMATION AGENT/DEPOSITARY AT THE
ADDRESS LISTED ABOVE.
All tendering holders of Units, by execution of this Letter of
Transmittal or facsimile hereof, waive any right to receive any notice of the
acceptance of their Units for payment.
2. SIGNATURES. All Limited Partners must sign in the Signature Box on
the back of the Letter of Transmittal. If the Units are held in the
names of two or more persons, all such persons must sign the Letter of
Transmittal. When signing as a general partner, corporate officer,
attorney-in-fact, executor, custodian, administrator or guardian,
please give full title and send proper evidence of authority
satisfactory to the Purchaser with this Letter of Transmittal. With
respect to most trusts, the Partnership will generally require only
the named trustee to sign the Letter of Transmittal. For Units held
in a custodial account for minors, only the signature of the custodian
will be required.
For IRA custodial accounts, the beneficial owner should return the
executed Letter of Transmittal to the Information Agent/Depositary as
specified in Instruction 1 herein. Such Letter of Transmittal will
then be forwarded by the Information Agent/Depositary to the custodian
for additional execution. Such Letter of Transmittal will not be
considered duly completed until after it has been executed by the
custodian.
If any tendered Units are registered in different names, it will be
necessary to complete, sign and submit as many separate Letters of
Transmittal as there are different registrations of certificates.
If the Letter of Transmittal is signed by the registered holder of the
Units tendered herewith and payment is to be made directly to that
holder, then no signature guarantee is required on the Letter of
Transmittal. Similarly, if the Units are tendered for the account of
a member firm of a registered national securities exchange, a member
of the National Association of Securities Dealers, Inc. or a
commercial bank, savings bank, credit union, savings and loan
association or trust company having an office, branch or agency in the
United States (each an "Eligible Institution"), no signature guarantee
is required on the Letter of Transmittal. However, in all other
cases, all signatures on the Letter of Transmittal must be guaranteed
by an Eligible Institution.
3. U.S. PERSONS. A Limited Partner who or which is a United States
citizen OR a resident alien individual, a domestic corporation, a
domestic partnership, a domestic trust or a domestic estate
(collectively, "United States Persons") as those terms are defined in
the Code and Income Tax Regulations, should follow the instructions
below with respect to certifying Boxes A and B (on the reverse side of
the Letter of Transmittal).
TAXPAYER IDENTIFICATION NUMBER. To avoid 31% federal income tax
backup withholding, the Limited Partner must furnish his, her or its
TIN in the blank provided for that purpose on the back of the Letter
of Transmittal and certify under penalties of perjury Box A, B and, if
applicable, Box C.
(Continued on Back)
<PAGE> 4
WHEN DETERMINING THE TIN TO BE FURNISHED, PLEASE REFER TO THE FOLLOWING NOTE AS
A GUIDELINE:
NOTE: INDIVIDUAL ACCOUNTS should reflect their own TIN. JOINT
ACCOUNTS should reflect the TIN of the person whose name appears
first. TRUST ACCOUNTS should reflect the TIN assigned to the Trust.
IRA CUSTODIAL ACCOUNTS should reflect the TIN of the custodian.
CUSTODIAL ACCOUNTS FOR THE BENEFIT OF MINORS should reflect the TIN of
the minor. CORPORATIONS OR OTHER BUSINESS ENTITIES should reflect the
TIN assigned to that entity. If you need additional information,
please see the enclosed copy of the Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9.
SUBSTITUTE FORM W-9 - BOX A.
(i) In order to avoid 31% federal income tax backup withholding, the
Limited Partner must provide to the Purchaser in the blank provided
for that purpose on the back of the Letter of Transmittal the Limited
Partner's correct TIN and certify, under penalties of perjury, that
such Limited Partner is not subject to such backup withholding. The
TIN being provided on the Substitute Form W-9 is that of the
registered Limited Partner as indicated on the back of the Letter of
Transmittal. If a correct TIN is not provided, penalties may be
imposed by the IRS, in addition to the Limited Partner being subject
to backup withholding. Certain Limited Partners (including, among
others, all corporations) are not subject to backup withholding.
Backup withholding is not an additional tax. If withholding results
in an overpayment of taxes, a refund may be obtained from the IRS.
(ii) DO NOT CHECK THE BOX IN BOX A, PART (ii), UNLESS YOU HAVE BEEN
NOTIFIED BY THE IRS THAT YOU ARE SUBJECT TO BACKUP WITHHOLDING.
FIRPTA AFFIDAVIT - BOX B. To avoid withholding of tax pursuant to
Section 1445 of the Code, each Limited Partner who or which is a United
States Person (as defined in Instruction 3 above) must certify, under
penalties of perjury, the Limited Partner's TIN and address, and that
the Limited Partner is not a foreign person. Tax withheld under Section
1445 of the Internal Revenue Code is not an additional tax. If
withholding results in an overpayment of tax, a refund may be obtained
from the IRS. CHECK THE BOX IN BOX B, PART (ii) ONLY IF YOU ARE NOT A
U.S. PERSON, AS DESCRIBED THEREIN.
4. FOREIGN PERSONS - BOX C. In order for a Limited Partner who is a
foreign person (i.e., not a United States Person as defined in
Instruction 3 above) to qualify as exempt from 31% backup withholding,
such foreign Limited Partner must certify, under penalties of perjury,
the statement in Box C of this Letter of Transmittal attesting to that
foreign person's status by checking the box in such statement. UNLESS
SUCH BOX IS CHECKED, SUCH FOREIGN PERSON WILL BE SUBJECT TO 31%
WITHHOLDING OF TAX UNDER SECTION 1445 OF THE CODE.
5. CONDITIONAL TENDERS. No alternative, conditional or contingent tenders
will be accepted.
6. VALIDITY OF LETTER OF TRANSMITTAL. All questions as to the validity,
form, eligibility (including time of receipt) and acceptance of a Letter
of Transmittal will be determined by the Purchaser and such
determination will be final and binding. The Purchaser's interpretation
of the terms and conditions of the Offer (including these instructions
for the Letter of Transmittal) also will be final and binding. The
Purchaser will have the right to waive any irregularities or conditions
as to the manner of tendering. Any irregularities in connection with
tenders must be cured within such time as the Purchaser shall determine
unless waived by it.
The Letter of Transmittal will not be valid unless and until any
irregularities have been cured or waived. Neither the Purchaser nor the
Information Agent/Depositary is under any duty to give notification of
defects in a Letter of Transmittal and will incur no liability for
failure to give such notification.
7. ASSIGNEE STATUS. Assignees must provide documentation to the
Information Agent/Depositary which demonstrates, to the satisfaction of
the Purchaser, such person's status as an assignee.
8. INADEQUATE SPACE. If the space provided herein is inadequate, the
numbers of Units and any other information should be listed on a
separate schedule attached hereto and separately signed on each page
thereof in the same manner as this Letter of Transmittal is signed.
Questions and requests for assistance may be directed to the Information
Agent/Depositary at its address and telephone number listed below. Additional
copies of the Offer to Purchase, the Letter of Transmittal and other tender
offer materials may be obtained from the Information Agent as set forth below,
and will be furnished promptly at the Purchaser's expense. You may also
contact your broker, dealer, commercial bank, trust company or other nominee
for assistance concerning the Offer.
The Information Agent/Depositary for the Offer is:
[THE HERMAN GROUP INC. LOGO]
2121 San Jacinto Street
26th Floor
Dallas, Texas 75201
or
Call Toll-Free (800) 992-6176
<PAGE> 1
NOTICE OF WITHDRAWAL
OF
PREVIOUSLY TENDERED UNITS OF LIMITED PARTNERSHIP INTEREST
OF
PROMETHEUS INCOME PARTNERS
TO
PIP PARTNERS - GENERAL, LLC
PURSUANT TO THE OFFER TO PURCHASE DATED NOVEMBER 8, 1996
================================================================================
INSTRUCTIONS FOR WITHDRAWAL
A written or facsimile transmission of a Notice of Withdrawal may be submitted
at any time prior to the Expiration Date (or any extensions thereof) to the
Depositary for the PIP Partners - General, LLC Offer:
To: IBJ Schroder Bank & Trust Company
<TABLE>
<CAPTION>
By Mail By Courier or Hand Delivery
------- ---------------------------
<S> <C>
Bowling Green Station One State Street
Attention: Reorganization Operations Department Attention: Securities Processing Window;
New York, New York 10274-0084 Subcellar One (SC-1)
New York, New York 10004
By Facsimile To Confirm by Telephone
------------ -----------------------
(212) 858-2611 (212) 858-2103
</TABLE>
PLEASE REFER TO THE PROCEDURES FOR WITHDRAWAL SET FORTH IN SECTION 4,
"WITHDRAWAL RIGHTS" IN THE OFFER TO PURCHASE
================================================================================
To: IBJ Schroder Bank & Trust Company, Depositary
Ladies/Gentlemen:
Unless otherwise indicated in the box below, the units of limited
partnership interest ("Units") of the Partnership as listed below, which were
previously tendered pursuant to the PIP Partners - General, LLC Offer to
Purchase dated November 8, 1996, are hereby withdrawn. UNLESS OTHERWISE
INDICATED, THE NUMBER OF UNITS BEING WITHDRAWN ARE ALL OF THE UNITS TENDERED.
NUMBER OF UNITS WITHDRAWN
================================================================================
LIMITED PARTNER(S) SIGNATURE BOX FIDUCIARY INFORMATION BOX
(All Owners Must Sign)
If tendered by the Limited Partner(s) Complete this box only if signing as
listed above, please sign exactly as a trustee, executor, administrator,
your name(s) is/are printed (or guardian, attorney-in-fact, officer
corrected) above. For joint owners, of a corporation or other person
each joint owner must sign. Note: The acting in a fiduciary or
signatures of the persons signing this representative capacity. Note: The
Withdrawal Notice must be the same as signatures of the persons signing
those signing the Letter of Transmittal this Withdrawal Notice must be the
previously submitted in every respect. same as those signing the Letter of
Transmittal previously submitted in
every respect.
X Name(s) and Capacity
- ---------------------------------------- -----------------
(Signature of Owner) (Date)
Address:
------------------------------
X
- ---------------------------------------- City, State, Zip:
(Signature of Co-Owner) (Date) --------------------
================================================================================
<PAGE> 1
FOR IMMEDIATE RELEASE
Contact: The Herman Group, Inc.
800-992-6176
Attention: Sherri Herman
PROM INVESTMENT PARTNERS INCREASES OFFER PRICE TO
$480 PER UNIT OF PROMETHEUS INCOME PARTNERS
NEW YORK, NEW YORK (December 5, 1996) -- PROM INVESTMENT PARTNERS L.L.C.
has announced that the purchase price in its offer to purchase outstanding
units of limited partnership interest of Prometheus Income Partners (the
"Partnership") has been increased to $480 per Unit. The increased purchase
price by Prom Investment Partners is $5 per Unit higher than the price offered
by an affiliate of the Partnership's general partner. Unitholders who have
tendered their Units to Prom Investment Partners will automatically receive the
benefit of the $480 purchase price and need not take any further action.
Prom Investment Partners' offer has also been extended and is now
scheduled to expire at 12:00 midnight, New York City time, on December 20,
1996. As of the close of business on December 4, 1996, Prom Investment
Partners reasonably believed that approximately 874 Units had been tendered to
it and not withdrawn.
For additional information, contact The Herman Group, Inc., the
Information Agent/Depositary for Offer by Prom Investment Partners, at
800-992-6176.
