<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
-------------------------
ARVIDA/JMB PARTNERS, L.P.
a Delaware Limited Partnership
(Name of Subject Company)
RALEIGH CAPITAL ASSOCIATES L.P.
RALEIGH GP CORP.
ROCKLAND PARTNERS, INC.
ZEPHYR PARTNERS
(Bidder)
LIMITED PARTNERSHIP INTERESTS AND ASSIGNEE INTERESTS THEREIN
(Title of Class
of Securities)
NONE
(CUSIP Number of Class
of Securities)
-------------------------
Michael L. Ashner Copy to:
Raleigh Capital Associates L.P. Mark I. Fisher
100 Jericho Quadrangle Todd J. Emmerman
Suite 214 Rosenman & Colin LLP
Jericho, New York 11735-2717 575 Madison Avenue
(516) 822-0022 New York, New York 10022-2585
(212) 940-8800
(Name, Address and Telephone Number of
Person Authorized to Receive Notices and
Communications on Behalf of Bidder)
Calculation of Filing Fee
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Transaction Amount of
Valuation* Filing Fee
---------- ----------
<S> <C>
$50,000,000 $10,000
- --------------------------------------------------------------------------------
</TABLE>
*For purposes of calculating the filing fee only. This amount assumes the
purchase of 100,000 Limited Partnership Interests and Assignee Interests
Therein ("Units") of the subject company for $500 per Unit in cash.
[ ] 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.
(Continued on following pages)
(Page 1 of 12 Pages)
<PAGE> 2
CUSIP NO. M/A 14D-1 PAGE 2 OF 12 PAGES
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
RALEIGH CAPITAL ASSOCIATES L.P.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [X]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
AF; WC
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
80,342
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[ ]
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.9%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON*
PN
- --------------------------------------------------------------------------------
*SEE INSTRUCTION BEFORE FILLING OUT!
INCLUDED BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND SIGNATURE ATTESTATION.
<PAGE> 3
CUSIP NO. N/A 14D-1 PAGE 3 OF 12 PAGES
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
RALEIGH GP CORP.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [X]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
N/A
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
80,342 Units*
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[ ]
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.9%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON*
CO
- --------------------------------------------------------------------------------
* Reflects beneficial ownership by Raleigh Capital Associates L.P. (of which
Raleigh GP Corp. is a general partner).
<PAGE> 4
CUSIP NO. 14D-1 PAGE 4 OF 12 PAGES
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
ROCKLAND PARTNERS, INC.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [X]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
N/A
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
80,347 Units*
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[ ]
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.9%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON*
CO
- --------------------------------------------------------------------------------
* Reflects beneficial ownership of 5 Units by Rockland Partners, L.P. (of which
Rockland Partners, Inc. is the general partner) and 80,342 Units beneficially
owned by Raleigh Capital Associates L.P. (of which Rockland Partners, Inc. is a
general partner).
<PAGE> 5
CUSIP NO. 14D-1 PAGE 5 OF 12 PAGES
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
ZEPHYR PARTNERS
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [X]
(b) [ ]
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
N/A
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
80,342 Units*
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[ ]
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.9%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON*
PN
- --------------------------------------------------------------------------------
* Reflects beneficial ownership by Raleigh Capital Associates L.P. (of which
Zephyr Partners is a general partner).
5
<PAGE> 6
Item 1. Security and Subject Company.
(a) The name of the subject company is Arvida/JMB Partners, L.P., a
Delaware limited partnership (the "Partnership"), which has its principal
executive offices at 900 N. Michigan Avenue, Chicago, Illinois 60611.
(b) This Schedule relates to the offer by Raleigh Capital Associates
L.P., a Delaware limited partnership (the "Purchaser"), to purchase up to
100,000 outstanding Limited Partnership Interests and Assignee Interests Therein
("Units") of the Partnership at $500 per Unit less the amount of any
distributions declared or made with respect to the Units between October 17,
1996 (the "Offer Date") and the date of payment of the Purchase Price by the
Purchaser, net to the seller in cash, without interest, upon the terms and
subject to the conditions set forth in the Offer to Purchase dated October 17,
1996 (the "Offer to Purchase") and the related Letter of Transmittal, copies of
which are attached hereto as Exhibits (a)(1) and (a)(2), respectively. The
number of Units outstanding is set forth in "INTRODUCTION" in the Offer to
Purchase and is incorporated herein by reference.
(c) The information set forth in "THE TENDER OFFER -- Section 13.
Purchase Price Considerations" of the Offer to Purchase is incorporated herein
by reference.
Item 2. Identity and Background.
(a)-(d) The information set forth in "INTRODUCTION", "THE TENDER OFFER
- -- Section 11. Certain Information Concerning the Purchaser" and Schedule 1 of
the Offer to Purchase is incorporated herein by reference.
6
<PAGE> 7
(e)-(f) During the last five years, neither the Purchaser nor, to the
best of its knowledge, any of the persons listed in Schedule 1 or referred to in
Section 11 of the Offer to Purchase (i) has been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors) or (ii) was a
party to a civil proceeding of a judicial or administrative body of competent
jurisdiction and as a result of such proceeding was or is subject to a judgment,
decree or final order enjoining future violations of, or prohibiting activities
subject to, Federal or State securities laws or finding any violation of such
laws.
(g) The information set forth in Schedule 1 of the Offer to Purchase is
incorporated herein by reference.
Item 3. Past Contacts, Transactions or Negotiations With the Subject Company.
(a) None.
(b) The information set forth in "INTRODUCTION" and "THE TENDER OFFER
- -- Section 11. Certain Information Concerning the Purchaser" of the Offer to
Purchase is incorporated herein by reference.
Item 4. Source and Amount of Funds or Other Consideration.
(a) The information set forth in "THE TENDER OFFER -- Section 12.
Source of Funds" of the Offer to Purchase is incorporated herein by reference.
(b) Not applicable.
(c) Not applicable.
7
<PAGE> 8
Item 5. Purpose of the Tender Offer and Plans or Proposals of the Bidder.
(a)-(e) The information set forth in "THE TENDER OFFER -- Section 8.
Future Plans" of the Offer to Purchase is incorporated herein by reference.
(f)-(g) The information set forth in "THE TENDER OFFER -- Section 7.
Effects of the Offer" of the Offer to Purchase is incorporated herein by
reference.
Item 6. Interest in Securities of the Subject Company.
(a)-(b) The information set forth in "INTRODUCTION" and "THE TENDER
OFFER -- Section 11. Certain Information Concerning the Purchaser" of the Offer
to Purchase is incorporated herein by reference.
Item 7. Contracts, Arrangements, Understandings or Relationships with Respect
to the Subject Company's Securities.
The information set forth in "THE TENDER OFFER -- Section 11. Certain
Information Concerning the Purchaser" of the Offer to Purchase is incorporated
herein by reference.
Item 8. Persons Retained, Employed or to be Compensated.
The information set forth in "THE TENDER OFFER -- Section 16. Fees and
Expenses" of the Offer to Purchase is incorporated herein by reference.
Item 9. Financial Statements of Certain Bidders.
Not applicable.
Item 10. Additional Information.
8
<PAGE> 9
(a) None.
(b)-(d) The information set forth in "THE TENDER OFFER -- Section 15.
Certain Legal Matters" of the Offer to Purchase is incorporated herein by
reference.
(e) Not applicable.
(f) Reference is hereby made to the Offer to Purchase and the
related Letter of Transmittal, copies of which are attached hereto as Exhibits
(a)(1) and (a)(2), respectively, and which are incorporated herein in their
entirety by reference.
Item 11. Material to be Filed as Exhibits.
99(a)(1) Offer to Purchase dated October 17, 1996.
99(a)(2) Letter of Transmittal.
99(a)(3) Cover Letter from Raleigh Capital Associates L.P. to
Unitholders.
99(c)-(f) Not applicable.
9
<PAGE> 10
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: October 17, 1996
RALEIGH CAPITAL ASSOCIATES L.P.
By: Raleigh GP Corp., General Partner
By: /s/Peter Braverman
--------------------------
Name: Peter Braverman
Title: Vice President
By: ROCKLAND PARTNERS, INC.,
General Partner
By: /s/Jonathan H. Paul
---------------------------
Name: Jonathan H. Paul
Title: Vice President
By: ZEPHYR PARTNERS
By: GP Aeolus Inc., General
Partner
By: /s/Edward Mattner
--------------------------
Name: Edward Mattner
Title: Vice President
By: AREHGP INC., General Partner
By: /s/John Saldarelli
-------------------------
Name: John Saldarelli
Title: President
RALEIGH GP CORP.
By: /s/Peter Braverman
--------------------------
Name: Peter Braverman
Title: Vice President
[Schedule 14D-1 dated October 17, 1996]
10
<PAGE> 11
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: October 17, 1996
ROCKLAND PARTNERS, INC.
By: /s/Jonathan H. Paul
--------------------------------
Name: Jonathan H. Paul
Title: Vice President
ZEPHYR PARTNERS
By: GP Aeolus Inc., General Partner
By: /s/Edward Mattner
--------------------------------
Name: Edward Mattner
Title: Vice President
By: AREHGP INC., General Partner
By: /s/John Saldarelli
--------------------------------
Name: John Saldarelli
Title: President
[Schedule 14D-1 dated October 17, 1996]
11
<PAGE> 12
Exhibit Index
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
99(a)(1) Offer to Purchase dated October 17, 1996 . . . . . . . . . .
99(a)(2) Letter of Transmittal . . . . . . . . . . . . . . . . . . .
99(a)(3) Cover Letter from Raleigh Capital Associates L.P to
Unitholders . . . . . . . . . . . . . . . . . . . . . . . .
</TABLE>
<PAGE> 1
OFFER TO PURCHASE FOR CASH
UP TO 100,000 LIMITED PARTNERSHIP INTERESTS
(AND ASSIGNEE INTERESTS THEREIN)
OF
ARVIDA/JMB PARTNERS, L.P.
FOR
$500 NET PER UNIT
BY
RALEIGH CAPITAL ASSOCIATES L.P.
***************************************************************************
* *
* THE OFFER, WITHDRAWAL RIGHTS AND PRORATION PERIOD WILL EXPIRE AT *
* 12:00 MIDNIGHT, NEW YORK CITY TIME, ON NOVEMBER 14, 1996, UNLESS *
* EXTENDED. *
* *
***************************************************************************
Raleigh Capital Associates L.P., a Delaware limited partnership (the
"Purchaser"), hereby offers to purchase up to 100,000 of the outstanding
Limited Partnership Interests and assignee interests therein (the "Units") of
Arvida/JMB Partners, L.P., a Delaware limited partnership (the "Partnership"),
at a purchase price (the "Purchase Price") equal to $500 per Unit, less the
amount of any distributions declared or made with respect to the Units between
October 17, 1996 (the "Offer Date") and the date of payment of the Purchase
Price by the Purchaser, net to the seller in cash, without interest, upon the
terms set forth in this Offer to Purchase (the "Offer to Purchase") and in the
related Letter of Transmittal, as each may be supplemented or amended from time
to time (which together constitute the "Offer"). HOLDERS OF UNITS
("UNITHOLDERS") WHO TENDER THEIR UNITS WILL NOT BE OBLIGATED TO PAY ANY
COMMISSIONS OR PARTNERSHIP TRANSFER FEES, WHICH COMMISSIONS AND FEES WILL BE
BORNE BY THE PURCHASER. The 100,000 Units sought pursuant to the Offer
represent approximately 22% of the total Units outstanding as of June 30, 1996.
On August 1, 1996, the Purchaser acquired 79,696 Units at a purchase price of
$461 per Unit pursuant to its June 19, 1996 offer to purchase up to 185,000
Units (the "Prior Tender Offer").
THE PURCHASER IS NOT AFFILIATED WITH ARVIDA/JMB MANAGERS, INC., THE
GENERAL PARTNER OF THE PARTNERSHIP (the "General Partner").
Before tendering, Unitholders are urged to consider the following
factors:
o The Partnership has entered into a financing agreement (the "Starwood
Financing") with Starwood Florida Funding, LLC ("Starwood Florida"), an
affiliate of Starwood Capital ("Starwood"), which the General Partner
has estimated would enable the Partnership to make a distribution to
Unitholders of $350 per Unit.
o THE PURCHASER HAS COMMENCED AN ACTION IN THE COURT OF CHANCERY OF THE
STATE OF DELAWARE IN AND FOR NEW CASTLE COUNTY SEEKING, AMONG OTHER
THINGS, TO ENJOIN THE CONSUMMATION OF THE STARWOOD FINANCING. THIS
OFFER IS CONDITIONED UPON THE REJECTION OF THE STARWOOD FINANCING BY THE
PARTNERSHIP OR THE ISSUANCE OF AN INJUNCTION ENJOINING THE STARWOOD
FINANCING.
o The Purchaser has filed preliminary proxy material with the Securities
and Exchange Commission (the "Commission") for a consent solicitation
(the "Consent Solicitation") which seeks to remove the General Partner
and replace it with Raleigh Realty Management L.P., a Delaware limited
partnership and an affiliate of the Purchaser ("Raleigh Realty
Management"). However, consummation of the Offer is not conditioned on
the success of the Consent Solicitation. If the General Partner is
removed and replaced, Raleigh Realty Management intends to reject the
Starwood Financing and attempt to pursue alternative financing
arrangements for the benefit of the Partnership and Unitholders.
o This Offer does not constitute a proxy statement and Unitholders can
only vote to remove the General Partner and replace it with Raleigh
Realty Management pursuant to the Consent Solicitation.
(continued on next page)
<PAGE> 2
(continued from prior page)
o On September 13, 1996, the Purchaser proposed to the General Partner
that the Partnership enter into an agreement with the Purchaser
pursuant to which the Partnership and an affiliate of the Purchaser
would combine and Unitholders would have the choice of receiving either
(i) $500 per Unit in cash or (ii) at least $525 per Unit, comprised of
$400 per Unit in cash plus a security of the surviving entity which
would be worth not less than $125 per Unit, or more if the assumptions
with respect to the Units made by Lehman Brothers, a financial advisor
retained by the Partnership, are attained. The proposal, which was
conditioned on the Starwood Financing not being consummated, was
rejected by the General Partner.
o The book value of each Unit (the "Book Value"), as reflected on the
Partnership's Form 10-Q for the quarter ended June 30, 1996, was $576
per Unit. The Book Value represents the portion of the excess of the
Partnership's assets over its liabilities, as determined in accordance
with generally accepted accounting principles, which is attributable to
the Units. Book Value does not necessarily reflect the fair market
value of a Unit, which may be higher or lower than the Book Value
depending on several factors, including liquidity of the Units and
external economic and market factors. Book Value also does not reflect
the amount which a Unitholder would ultimately receive if the
Partnership were liquidated. Such amount would likely be affected by
several factors, including the time required to effect a liquidation of
the Partnership's assets and the ability of the Partnership to realize
the full value of its assets as reflected in the Book Value.
Furthermore, Book Value may not take into account liabilities associated
with resolution of numerous pending litigations against the Partnership.
o In connection with the Prior Tender Offer, Lehman Brothers estimated a
"hypothetical liquidation value" of between $565 and $610 per Unit.
This hypothetical value assumes, among other things, a liquidation of
the Partnership over a six year period ending in the year 2002. THE
HYPOTHETICAL VALUE DOES NOT REPRESENT, AND NEITHER THE PARTNERSHIP NOR
ITS FINANCIAL ADVISOR PROVIDED UNITHOLDERS WITH, AN ESTIMATE OF THE
CURRENT FAIR MARKET VALUE OF THE UNITS.
o An independent ERISA appraiser valued the Units at $294 per Unit as of
September 30, 1995.
o Pursuant to the Amended and Restated Agreement of Limited Partnership of
the Partnership (the "Partnership Agreement"), the General Partner is
obligated on or prior to October 31, 1997 to either (i) cause the Units
to be listed on a national exchange or reported by the National
Association of Securities Dealers Automated Quotation System, (ii)
purchase, or cause an affiliate to purchase, all outstanding Units at
their then appraised fair market value or (iii) commence a liquidation
of the Partnership's assets. Unitholders who tender their Units will be
giving up any potential benefit relating to any such action by the
General Partner as well as any other potential benefits represented by
the ownership of such Units, including the right to receive any future
distributions by the Partnership. MEMBERS OF A SPECIAL COMMITTEE OF THE
GENERAL PARTNER HAVE INDICATED THAT IT IS THEIR CURRENT INTENTION TO
VOTE IN FAVOR OF A 5-YEAR LIQUIDATION WHICH WOULD COMMENCE ON OCTOBER
31, 1997.
o The Purchaser is making the Offer with a view to making a profit.
Accordingly, in establishing the Purchase Price, the Purchaser was
motivated to set the lowest price for the Units which might be
acceptable to Unitholders consistent with the Purchaser's objectives.
Such objectives and motivations may conflict with the interest of
Unitholders in receiving the highest price for their Units. No
independent person has been retained to evaluate or render any opinion
with respect to the fairness of the Purchase Price and no representation
is made by the Purchaser or any affiliate of the Purchaser as to such
fairness.
o The Purchaser currently owns approximately 20% of the outstanding Units
and accordingly is in a position to significantly influence all
Partnership decisions on which Unitholders may vote, including decisions
regarding removal of the General Partner, merger, sales of assets and
liquidation. (See "THE TENDER OFFER - Section 7. Effects of the
Offer".) This means that (i) non-tendering Unitholders could be
prevented from taking action they desire but that the Purchaser opposes
and (ii) the Purchaser may be able to take action desired by the
Purchaser but opposed by the non-tendering Unitholders. The acquisition
of additional Units pursuant to the Offer would enhance such voting
influence. The Purchaser intends to vote all Units owned by it,
including any Units acquired in the Offer, in
(continued on next page)
<PAGE> 3
(continued from prior page)
favor of the removal of the General Partner and its replacement with
Raleigh Realty Management. By tendering Units, a Unitholder will be
giving up its right to vote such Units in the Consent Solicitation.
o Consummation of the Offer may limit the ability of Unitholders to
dispose of Units in the secondary market during the twelve month period
following completion of the Offer. (See "THE TENDER OFFER - Section 7.
Effects of the Offer" in this Offer to Purchase.)
o Unitholders could, as an alternative to tendering their Units, propose a
variety of possible actions, including liquidation of the Partnership or
removal and replacement of the General Partner.
The Offer is not conditioned upon any minimum number of Units being
tendered. If more than the number of Units sought pursuant to the Offer are
validly tendered and not withdrawn, the Purchaser will accept for purchase such
total number of Units sought, on a pro rata basis, subject to the terms and
conditions herein.
The Purchaser expressly reserves the right, in its sole discretion, at
any time and from time to time (i) to extend the period of time during which
the Offer is open and thereby delay acceptance for payment of, and the payment
for, any Units, (ii) to terminate the Offer and not accept for payment any
Units not theretofore accepted for payment or paid for, (iii) upon the
occurrence of any of the conditions specified in Section 14 of this Offer to
Purchase, to delay the acceptance for payment of, or payment for, any Units not
theretofore accepted for payment or paid for, and (iv) to amend the Offer in
any respect (including, without limitation, by increasing the consideration
offered, increasing or decreasing the number of Units being sought, or both).
Notice of any such termination or amendment will promptly be disseminated to
Unitholders in a manner reasonably designed to inform Unitholders of such
change in compliance with Rule 14d-4(c) under the Securities Exchange Act of
1934, as amended (the "Exchange Act"). In the case of an extension of the
Offer, such extension will be followed by a press release or public
announcement which will be issued no later than 9:00 a.m., New York City time,
on the next business day after the scheduled Expiration Date, in accordance
with Rule 14e-1(d) under the Exchange Act.
UNITHOLDERS ARE URGED TO READ THIS OFFER TO PURCHASE AND THE
ACCOMPANYING LETTER OF TRANSMITTAL CAREFULLY BEFORE DECIDING WHETHER TO TENDER
THEIR UNITS. ANY UNITHOLDER DESIRING TO TENDER UNITS SHOULD COMPLETE AND SIGN
THE LETTER OF TRANSMITTAL (OR A FACSIMILE THEREOF) AND MAIL OR DELIVER THE
SIGNED LETTER OF TRANSMITTAL TO THE HERMAN GROUP, INC., THE DEPOSITARY FOR THE
OFFER (THE "DEPOSITARY"), AT THE FOLLOWING ADDRESS:
THE HERMAN GROUP, INC.
BY HAND, MAIL OR OVERNIGHT DELIVERY: 2121 SAN JACINTO STREET, 26TH FLOOR
DALLAS, TEXAS 75201
BY FACSIMILE: (214) 999-9348 OR (214) 999-9323
IF YOU HAVE ANY QUESTIONS OR IF YOU NEED ASSISTANCE IN COMPLETION OF THE
LETTER OF TRANSMITTAL, YOU MAY CONTACT THE INFORMATION AGENT BY CALLING:
(800) 992-6146
<PAGE> 4
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
THE TENDER OFFER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 1. Terms of the Offer . . . . . . . . . . . . . . . . . . . . . . 4
Section 2. Proration; Acceptance for Payment and Payment for Units . . . . 4
Section 3. Procedures for Tendering Units . . . . . . . . . . . . . . . . 5
Section 4. Withdrawal Rights . . . . . . . . . . . . . . . . . . . . . . . 6
Section 5. Extension of Tender Period; Termination; Amendment . . . . . . 6
Section 6. Certain Federal Income Tax Consequences . . . . . . . . . . . . 7
Section 7. Effects of the Offer . . . . . . . . . . . . . . . . . . . . . 9
Section 8. Future Plans . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 9. Certain Information Concerning the Partnership . . . . . . . 10
Section 10. Conflicts of Interest. . . . . . . . . . . . . . . . . . . . . 13
Section 11. Certain Information Concerning the Purchaser . . . . . . . . . 13
Section 12. Source of Funds . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 13. Purchase Price Considerations. . . . . . . . . . . . . . . . . 16
Section 14. Conditions of the Offer . . . . . . . . . . . . . . . . . . . . 17
Section 15. Certain Legal Matters. . . . . . . . . . . . . . . . . . . . . 19
Section 16. Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . . 19
Section 17. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . 19
</TABLE>
Appendix A Glossary
Schedule 1 Information with respect to the executive officers and
directors of Raleigh GP Corp., Rockland Partners, Inc., GP
Aeolus Inc., AREHGP INC. and American Property Investors Inc.
<PAGE> 5
To the Holders of Limited Partnership Interests (and assignee interests
therein) of
Arvida/JMB Partners, L.P.
INTRODUCTION
The Purchaser hereby offers to purchase up to 100,000 of the
outstanding Units for $500 per Unit, less the amount of any distributions
declared or paid with respect to the Units between the Offer Date and the date
of payment of the Purchase Price by the Purchaser, net to the seller in cash,
without interest, upon the terms set forth in this Offer to Purchase and in the
related Letter of Transmittal, as each may be supplemented or amended from time
to time. UNITHOLDERS WHO TENDER THEIR UNITS WILL NOT BE OBLIGATED TO PAY ANY
COMMISSIONS OR PARTNERSHIP TRANSFER FEES, WHICH COMMISSIONS AND FEES WILL BE
BORNE BY THE PURCHASER.
THE PURCHASER IS NOT AFFILIATED WITH THE GENERAL PARTNER.
No independent person has been retained to evaluate or render any
opinion with respect to the fairness of the Purchase Price. Unitholders are
urged to consider carefully all of the information contained herein before
accepting the Offer. (See "THE TENDER OFFER - Section 13. Purchase Price
Considerations".)
Before tendering, Unitholders are urged to consider the following
factors:
o The Partnership has entered into an agreement for the Starwood
Financing with Starwood Florida, an affiliate of Starwood, which the
General Partner has estimated would enable the Partnership to make a
distribution to Unitholders of $350 per Unit.
o THE PURCHASER HAS COMMENCED AN ACTION IN THE COURT OF CHANCERY OF THE
STATE OF DELAWARE IN AND FOR NEW CASTLE COUNTY SEEKING, AMONG OTHER
THINGS, TO ENJOIN THE CONSUMMATION OF THE STARWOOD FINANCING. THIS
OFFER IS CONDITIONED UPON THE REJECTION OF THE STARWOOD FINANCING BY
THE PARTNERSHIP OR THE ISSUANCE OF AN INJUNCTION ENJOINING THE STARWOOD
FINANCING.
o The Purchaser has filed preliminary proxy material for the Consent
Solicitation which seeks to remove the General Partner and replace it
with Raleigh Realty Management, an affiliate of the Purchaser.
However, consummation of the Offer is not conditioned on the success of
the Consent Solicitation. If the General Partner is removed and
replaced, Raleigh Realty Management intends to reject the Starwood
Financing and attempt to pursue alternative financing arrangements for
the benefit of the Partnership and Unitholders.
o This Offer does not constitute a proxy statement and Unitholders can
only vote to remove the General Partner and replace it with Raleigh
Realty Management pursuant to the Consent Solicitation.
o On September 13, 1996, the Purchaser proposed to the General Partner
that the Partnership enter into an agreement with the Purchaser
pursuant to which the Partnership and an affiliate of the Purchaser
would combine and Unitholders would have the choice of receiving either
(i) $500 per Unit in cash or (ii) at least $525 per Unit, comprised of
$400 per Unit in cash plus a security of the surviving entity which
would be worth not less than $125 per Unit, or more if the assumptions
with respect to the Units made by Lehman Brothers are attained. The
proposal, which was conditioned on the Starwood Financing not being
consummated, was rejected by the General Partner.
o The Book Value, as reflected on the Partnership's Form 10-Q for the
quarter ended June 30, 1996, was $576 per Unit. The Book Value
represents the portion of the excess of the Partnership's assets over
its liabilities, as determined in accordance with generally accepted
accounting principles, which is attributable to the Units. Book Value
does not necessarily reflect the fair market value of a Unit, which may
be higher
<PAGE> 6
or lower than the Book Value depending on several factors, including
liquidity of the Units and external economic and market factors. Book
Value also does not reflect the amount which a Unitholder would
ultimately receive if the Partnership were liquidated. Such amount
would likely be affected by several factors, including the time
required to effect a liquidation of the Partnership's assets and the
ability of the Partnership to realize the full value of its assets as
reflected in the Book Value. Furthermore, Book Value may not take into
account liabilities associated with resolution of numerous pending
litigations against the Partnership.
o In connection with the Prior Tender Offer, Lehman Brothers had
estimated a "hypothetical liquidation value" of between $565 and $610
per Unit. This hypothetical value assumes, among other things, a
liquidation of the Partnership over a six year period ending in the
year 2002. THE HYPOTHETICAL VALUE DOES NOT REPRESENT, AND NEITHER THE
PARTNERSHIP NOR ITS FINANCIAL ADVISOR PROVIDED UNITHOLDERS WITH, AN
ESTIMATE OF THE CURRENT FAIR MARKET VALUE OF THE UNITS DESPITE REPEATED
REQUESTS BY THE PURCHASER.
o An independent ERISA appraiser valued the Units at $294 per Unit as of
September 30, 1995.
o Pursuant to the Partnership Agreement, the General Partner is obligated
on or prior to October 31, 1997 to either (i) cause the Units to be
listed on a national exchange or reported by the National Association
of Securities Dealers Automated Quotation System, (ii) purchase, or
cause an affiliate to purchase, all outstanding Units at their then
appraised fair market value or (iii) commence a liquidation of the
Partnership's assets. Unitholders who tender their Units will be
giving up any potential benefit relating to any such action by the
General Partner as well as any other potential benefits represented by
the ownership of such Units, including the right to receive any future
distributions by the Partnership. MEMBERS OF A SPECIAL COMMITTEE OF
THE GENERAL PARTNER HAVE INDICATED THAT IT IS THEIR CURRENT INTENTION
TO VOTE IN FAVOR OF A 5-YEAR LIQUIDATION WHICH WOULD COMMENCE ON
OCTOBER 31, 1997.
o The Purchaser is making the Offer with a view to making a profit.
Accordingly, in establishing the Purchase Price, the Purchaser was
motivated to set the lowest price for the Units which might be
acceptable to Unitholders consistent with the Purchaser's objectives.
Such objectives and motivations may conflict with the interest of
Unitholders in receiving the highest price for their Units. No
independent person has been retained to evaluate or render any opinion
with respect to the fairness of the Purchase Price and no
representation is made by the Purchaser or any affiliate of the
Purchaser as to such fairness.
o The Purchaser currently owns approximately 20% of the outstanding Units
and accordingly is in a position to significantly influence all
Partnership decisions on which Unitholders may vote, including
decisions regarding removal of the General Partner, merger, sales of
assets and liquidation. (See "THE TENDER OFFER - Section 7. Effects
of the Offer".) This means that (i) non-tendering Unitholders could be
prevented from taking action they desire but that the Purchaser opposes
and (ii) the Purchaser may be able to take action desired by the
Purchaser but opposed by the non-tendering Unitholders. The
acquisition of additional Units pursuant to the Offer would enhance
such voting influence. The Purchaser intends to vote all Units owned
by it, including any Units acquired in the Offer, in favor of the
removal and replacement of the General Partner with Raleigh Realty
Management. By selling Units pursuant to the Offer, a Unitholder will
be giving up its right to vote such Units in the Consent Solicitation.
o Consummation of the Offer may limit the ability of Unitholders to
dispose of Units in the secondary market during the twelve month period
following completion of the Offer. (See "THE TENDER OFFER - Section 7.
Effects of the Offer" in this Offer to Purchase.)
o Unitholders could, as an alternative to tendering their Units, propose
a variety of possible actions, including liquidation of the Partnership
or removal and replacement of the General Partner.
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<PAGE> 7
Unitholders who desire liquidity may wish to consider the Offer.
However, each Unitholder must make his or her own decision based upon such
Unitholder's particular circumstances, including the Unitholder's own financial
needs, other investment opportunities and tax position. Each Unitholder should
consult with his or her own advisors, tax, financial or otherwise, in
evaluating the terms of and whether to tender Units pursuant to the Offer.
The Offer will provide Unitholders with an opportunity to liquidate
their investment without the usual transaction costs associated with market
sales. Unitholders may no longer wish to continue with their investment in the
Partnership for a number of reasons, including:
o Although not necessarily an indication of value, the $500 purchase
price is 82% higher than the $274 weighted average selling price for
Units reported for the limited secondary market during the six month
period ended July 31, 1996. In addition, the weighted price does not
reflect commissions and transaction costs paid by selling Unitholders,
which reduces the amount received from the sale of Units.
o The Offer will provide Unitholders with an immediate opportunity to
liquidate their investment in the Partnership without the usual
transaction costs associated with market sales or partnership transfer
fees.
o During the last three full years Unitholders have been required to
report taxable income of $274 per Unit while receiving cash
distributions of less than $20 per Unit.
o Unitholders who acquired their Units in the original offering should
receive a tax benefit from the sale of their Units in 1996.
o The absence of a formal trading market for the Units.
o General disenchantment with real estate investments, particularly
long-term investments in limited partnerships.
o By selling their Units in the Offer, Unitholders avoid the continuing
administrative costs (such as accounting, tax reporting, limited
partner reporting and public company reporting requirements) and
resultant indirect negative financial impact on the value of the Units
of a publicly registered limited partnership and eliminate the delays
and complications in preparing and filing personal income tax returns
which may result from an investment in the Units.
According to the Partnership's Form 10-K for its fiscal year ended December
31, 1995, as of such date, there were 404,000 Units issued and outstanding held
by 24,908 Unitholders. The Purchaser owns 80,342 Units in the aggregate,
constituting approximately 20% of the Units outstanding.
UNITHOLDERS ARE URGED TO READ THIS OFFER TO PURCHASE AND THE ACCOMPANYING
LETTER OF TRANSMITTAL CAREFULLY BEFORE DECIDING WHETHER TO TENDER THEIR UNITS.
IF YOU HAVE ANY QUESTIONS OR IF YOU NEED ASSISTANCE IN COMPLETION OF THE
LETTER OF TRANSMITTAL, YOU MAY CONTACT THE INFORMATION AGENT BY CALLING (800)
992-6146.
3
<PAGE> 8
THE TENDER OFFER
SECTION 1. TERMS OF THE OFFER. Upon the terms of the Offer, the Purchaser
will pay for Units validly tendered on or prior to the Expiration Date and not
withdrawn in accordance with Section 4 of this Offer to Purchase. The term
"Expiration Date" shall mean 12:00 Midnight, New York City time, on November
14, 1996, unless the Purchaser extends the period of time during which the
Offer is open. In the event the Offer is extended, the term "Expiration Date"
shall mean the latest time and date on which the Offer, as extended by the
Purchaser, shall expire.
IF, PRIOR TO THE EXPIRATION DATE, THE PURCHASER SHALL INCREASE THE PURCHASE
PRICE OFFERED TO UNITHOLDERS, SUCH INCREASED PURCHASE PRICE SHALL BE PAID FOR
ALL UNITS ACCEPTED FOR PAYMENT PURSUANT TO THE OFFER, WHETHER OR NOT SUCH UNITS
WERE TENDERED PRIOR TO SUCH INCREASE.
The Offer is conditioned on satisfaction of certain conditions, including
rejection of the Starwood Financing by the Partnership or the issuance of an
injunction enjoining the Starwood Financing. See Section 14, which sets forth
in full each of the conditions of the Offer. The Purchaser reserves the right
(but shall not be obligated), in its sole discretion, to waive any or all of
such conditions. If, on or prior to the Expiration Date, any or all of such
conditions have not been satisfied or waived, the Purchaser may (i) decline to
purchase any of the Units tendered, terminate the Offer and return all tendered
Units to tendering Unitholders, (ii) waive all the unsatisfied conditions and,
subject to complying with applicable rules and regulations of the Commission,
purchase all Units validly tendered, (iii) extend the Offer and, subject to the
right of Unitholders to withdraw Units until the Expiration Date, cause the
Depositary to retain the Units that have been tendered during the period or
periods for which the Offer is extended, or (iv) amend the Offer, including,
without limitation, to increase the Purchase Price.
SECTION 2. PRORATION; ACCEPTANCE FOR PAYMENT AND PAYMENT FOR UNITS. If
the number of Units validly tendered on or prior to the Expiration Date and not
withdrawn is equal to or less than the total number of Units sought pursuant to
the Offer, the Purchaser will accept for payment, subject to the terms and
conditions of the Offer, all Units so tendered. If the number of Units validly
tendered on or prior to the Expiration Date and not withdrawn exceeds the total
number of Units sought pursuant to the Offer, the Purchaser will accept for
payment, subject to the terms and conditions of the Offer, the total number of
Units sought pursuant to the Offer, on a pro rata basis (with such adjustments
to avoid purchase of fractional Units).
Subject to the terms and conditions of the Offer, the Purchaser will pay
for Units validly tendered and not withdrawn (in accordance with Section 4) as
promptly as practicable following the Expiration Date. In all cases, the
Purchase Price will be paid only after timely receipt by the Depositary of a
properly completed and duly executed Letter of Transmittal (or a facsimile
thereof), and any other documents required by the Letter of Transmittal. (See
"Section 3. Procedures for Tendering Units".)
For purposes of the Offer, the Purchaser shall be deemed to have accepted
for payment tendered Units when, as and if the Purchaser gives oral or written
notice to the Depositary of the Purchaser's acceptance for payment of such
Units pursuant to the Offer. Upon the terms and subject to the conditions of
the Offer, payment for Units tendered and accepted for payment pursuant to the
Offer will in all cases be made by deposit of the Purchase Price with the
Depositary, which will act as agent for the tendering Unitholders for the
purpose of receiving payment from the Purchaser and transmitting payment to
tendering Unitholders. Under no circumstances will interest be paid on the
Purchase Price by reason of any delay in making such payment.
If any tendered Units are not purchased for any reason, the Letter of
Transmittal with respect to such Units will be destroyed by the Purchaser. If
for any reason acceptance for payment of, or payment for, any Units tendered
pursuant to the Offer is delayed or the Purchaser is unable to accept for
payment, purchase or pay for Units tendered pursuant to the Offer, then,
without prejudice to the Purchaser's rights under Section 14, the Purchaser may
cause the Depositary to retain tendered Units and such Units may not be
withdrawn except to the extent that the tendering Unitholders are entitled to
withdrawal rights as described in Section 4; provided, however, that the
4
<PAGE> 9
Purchaser is required, pursuant to Rule 14e-1(c) under the Exchange Act, to pay
Unitholders the Purchase Price in respect of Units tendered or return such
Units promptly after termination or withdrawal of the Offer.
SECTION 3. PROCEDURES FOR TENDERING UNITS.
VALID TENDER. To validly tender Units, a properly completed and duly
executed Letter of Transmittal (or a facsimile thereof) and any other documents
required by the Letter of Transmittal, must be received by the Purchaser on or
prior to the Expiration Date. In order to comply with certain restrictions on
transfer in the Partnership Agreement, a tender which would result in the
tendering Unitholder owning less than five Units will not be effective.
SIGNATURE REQUIREMENTS. If the Letter of Transmittal is signed by the
registered holder of the Units 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 notarization
or 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.
IN ORDER FOR A TENDERING UNITHOLDER TO PARTICIPATE IN THE OFFER, UNITS MUST
BE VALIDLY TENDERED AND NOT WITHDRAWN ON OR PRIOR TO THE EXPIRATION DATE, WHICH
IS 12:00 MIDNIGHT, NEW YORK CITY TIME, ON NOVEMBER 14, 1996, UNLESS EXTENDED.
THE METHOD OF DELIVERY OF THE LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED
DOCUMENTS IS AT THE OPTION AND RISK OF THE TENDERING UNITHOLDER AND DELIVERY
WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY.
BACKUP FEDERAL INCOME TAX WITHHOLDING. To prevent the possible application
of backup federal income tax withholding with respect to payment of the
Purchase Price, a tendering Unitholder must provide the Purchaser with such
Unitholder's correct taxpayer identification number by completing the
Substitute Form W-9 included in the Letter of Transmittal. (See the
Instructions to the Letter of Transmittal and "Section 6. Certain Federal
Income Tax Consequences".)
FIRPTA WITHHOLDING. To prevent the withholding of federal income tax in an
amount equal to 10% of the sum of the Purchase Price plus the amount of
Partnership liabilities allocable to each Unit purchased, each Unitholder must
complete the FIRPTA Affidavit included in the Letter of Transmittal certifying
such Unitholder's taxpayer identification number and address and that the
Unitholder is not a foreign person. (See the Instructions to the Letter of
Transmittal and "Section 6. Certain Federal Income Tax Consequences".)
OTHER REQUIREMENTS. By executing a Letter of Transmittal, a tendering
Unitholder irrevocably appoints the designees of the Purchaser as such
Unitholder's proxies, in the manner set forth in the Letter of Transmittal,
each with full power of substitution, to the full extent of such Unitholder's
rights with respect to the Units tendered by such Unitholder and accepted for
payment and purchased by the Purchaser. 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
Unitholder with respect to such Units will, without further action, be revoked,
and no subsequent proxies may be given (and if given will not be effective).
The designees of the Purchaser will, as to such Units, be empowered to exercise
all voting and other rights of such Unitholder as they in their sole discretion
may deem proper at any meeting of Unitholders, by written consent or otherwise.
The Purchaser reserves the right to require that, in order for Units to be
deemed validly tendered, immediately upon the Purchaser's acceptance for
payment of such Units, the Purchaser must be able to exercise full voting
rights with respect to such Units, including voting at any meeting of
Unitholders then scheduled. In addition, by executing a Letter of Transmittal,
a Unitholder also assigns to the Purchaser all of the Unitholder's rights to
receive distributions from the Partnership with respect to Units which are
accepted for payment and purchased pursuant to the Offer,
5
<PAGE> 10
other than those distributions declared or made between the Offer Date and the
date of payment of the Purchase Price by the Purchaser.
DETERMINATION OF VALIDITY; REJECTION OF UNITS; WAIVER OF DEFECTS; NO
OBLIGATION TO GIVE NOTICE OF DEFECTS. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance for payment of any
tender of Units pursuant to the procedures described above will be determined
by the Purchaser, in its sole discretion, which determination shall be final
and binding. The Purchaser reserves the absolute right to reject any or all
tenders if not in proper form or if the acceptance of, or payment for, the
Units tendered may, in the opinion of the Purchaser's counsel, be unlawful.
The Purchaser also reserves the right to waive any defect or irregularity in
any tender with respect to any particular Units of any particular Unitholder,
and the Purchaser's interpretation of the terms and conditions of the Offer
(including the Letter of Transmittal and the Instructions thereto) will be
final and binding. Neither the Purchaser, the Depositary nor any other person
will be under any duty to give notification of any defects or irregularities in
the tender of any Units or will incur any liability for failure to give any
such notification.
A tender of Units pursuant to any of the procedures described above will
constitute a binding agreement between the tendering Unitholder and the
Purchaser on the terms set forth in the Offer.
SECTION 4. WITHDRAWAL RIGHTS. Except as otherwise provided in this
Section 4, all tenders of Units pursuant to the Offer are irrevocable, provided
that Units tendered pursuant to the Offer may be withdrawn at any time prior to
the Expiration Date and, unless already accepted for payment as provided in
this Offer to Purchase, may also be withdrawn at any time after December 15,
1996.
For withdrawal to be effective, a written or facsimile transmission notice
of withdrawal must be timely received by the Depositary at the address set
forth on the back cover of this Offer to Purchase. Any such notice of
withdrawal must specify the name of the person who tendered the Units to be
withdrawn and must be signed by the person(s) who signed the Letter of
Transmittal in the same manner as the Letter of Transmittal was signed.
If purchase of, or payment for, Units is delayed for any reason or if the
Purchaser is unable to purchase or pay for Units for any reason, then, without
prejudice to the Purchaser's rights under the Offer, the Purchaser may cause
the Depositary to retain tendered Units and such Units may not be withdrawn
except to the extent that tendering Unitholders are entitled to withdrawal
rights as set forth in this Section 4; provided, however, that the Purchaser is
required, pursuant to Rule 14e-1(c) under the Exchange Act, to pay Unitholders
the Purchase Price in respect of Units tendered or return such Units promptly
after termination or withdrawal of the Offer.
Any Units properly withdrawn will be deemed not to be validly tendered for
purposes of the Offer. Withdrawn Units may be re-tendered, however, by
following any of the procedures described in Section 3 at any time prior to the
Expiration Date.
SECTION 5. EXTENSION OF TENDER PERIOD; TERMINATION; AMENDMENT. The
Purchaser expressly reserves the right, in its sole discretion, at any time and
from time to time, (i) to extend the period of time during which the Offer is
open and thereby delay acceptance for payment of, and the payment for, any
Units, (ii) to terminate the Offer and not accept for payment any Units not
already accepted for payment or paid for, (iii) upon the occurrence of any of
the conditions specified in Section 14, to delay the acceptance for payment of,
or payment for, any Units not already accepted for payment or paid for, and
(iv) to amend the Offer in any respect (including, without limitation, by
increasing the consideration offered, increasing or decreasing the number of
Units being sought, or both). Notice of any such termination or amendment will
promptly be disseminated to Unitholders in a manner reasonably designed to
inform Unitholders of such change in compliance with Rule 14d-4(c) under the
Exchange Act. In the case of an extension of the Offer, such extension will be
followed by a press release or public announcement which will be issued no
later than 9:00 a.m., New York City time, on the next business day after the
scheduled Expiration Date, in accordance with Rule 14e-1(d) under the Exchange
Act.
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<PAGE> 11
If the Purchaser extends the Offer, or if the Purchaser (whether before or
after its acceptance for payment of Units) is delayed in its payment for Units
or is unable to pay for Units pursuant to the Offer for any reason, then,
without prejudice to the Purchaser's rights under the Offer, the Purchaser may
cause the Depositary to retain tendered Units and such Units may not be
withdrawn except to the extent tendering Unitholders are entitled to withdrawal
rights as described in Section 4; provided, however, that the Purchaser is
required, pursuant to Rule 14e-1(c) under the Exchange Act, to pay Unitholders
the Purchase Price in respect of Units tendered or return such Units promptly
after termination or withdrawal of the Offer.
If the Purchaser makes a material change in the terms of the Offer or the
information concerning the Offer or waives a material condition of the Offer,
the Purchaser will extend the Offer and disseminate additional tender offer
materials to the extent required by Rules 14d-4(c) and 14d-6(d) under the
Exchange Act. The minimum period during which an offer must remain open
following a material change in the terms of the offer or information concerning
the offer will depend upon the facts and circumstances, including the relative
materiality of the change in the terms or information. In the Commission's
view, an offer should remain open for a minimum of five business days from the
date the material change is first published, sent or given to securityholders,
and if material changes are made with respect to information that approaches
the significance of price or the percentage of securities sought, a minimum of
ten business days may be required to allow for adequate dissemination to
securityholders and for investor response. As used in this Offer to Purchase,
"business day" means any day other than a Saturday, Sunday or a federal
holiday, and consists of the time period from 12:01 a.m. through 12:00
Midnight, New York City time.
SECTION 6. CERTAIN FEDERAL INCOME TAX CONSEQUENCES. The following summary
is a general discussion of certain federal income tax consequences of a sale of
Units pursuant to the Offer assuming that the Partnership is a partnership for
federal income tax purposes and that it is not a "publicly-traded partnership"
as defined in Section 7704 of the Internal Revenue Code of 1986, as amended
(the "Code"). This summary is based on the Code, applicable Treasury
Regulations thereunder, administrative rulings, practice and procedures and
judicial authority as of the date of the Offer. All of the foregoing are
subject to change, and any such change could affect the continuing accuracy of
this summary. This summary does not discuss all aspects of federal income
taxation that may be relevant to a particular Unitholder in light of such
Unitholder's specific circumstances or to certain types of Unitholders subject
to special treatment under the federal income tax laws (for example, foreign
persons, dealers in securities, banks, insurance companies and tax-exempt
organizations), nor does it discuss any aspect of state, local, foreign or
other tax laws. Sales of Units pursuant to the Offer will be taxable
transactions for federal income tax purposes, and may also be taxable
transactions under applicable state, local, foreign and other tax laws. EACH
UNITHOLDER SHOULD CONSULT HIS OR ITS TAX ADVISOR AS TO THE PARTICULAR TAX
CONSEQUENCES TO SUCH UNITHOLDER OF SELLING UNITS PURSUANT TO THE OFFER.
As a partner in a partnership, a Unitholder is subject to current income
taxation on his allocable share of Partnership taxable income irrespective of
the amount of cash distributed by the Partnership to him. In each of the last
three years, a Unitholder's income tax liability on account of his investment
in Units has exceeded the cash payments received by him from the Partnership.
Taxable income in 1993, 1994 and 1995 aggregated $69 per Unit, $100 per Unit
and $105 per Unit, respectively, while distributions during such periods were
$0 per Unit, $6.35 per Unit and $13.49 per Unit, respectively. A Unitholder
who elects not to sell his Units pursuant to the Offer may continue to incur
income tax liability on account of owning Units in excess of the current cash
distributions made to such Unitholder, as the Partnership's credit facility
imposes restrictions on the amount of cash that can be distributed to
Unitholders.
A Unitholder will recognize gain or loss on a sale of Units pursuant to the
Offer equal to the difference between (i) the Unitholder's "amount realized" on
the sale and (ii) the Unitholder's adjusted tax basis in the Units sold. The
"amount realized" with respect to a Unit sold pursuant to the Offer will be a
sum equal to the amount of cash received by the Unitholder for the Unit plus
the amount of Partnership liabilities allocable to the Unit (as determined
under Code Section 752). The amount of a Unitholder's adjusted tax basis in
Units sold pursuant to the Offer will vary depending upon the Unitholder's
particular circumstances, and will be affected by both allocations of
Partnership income, gain or loss, and any cash distributions made by the
Partnership to a Unitholder with respect
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<PAGE> 12
to such Units. In this regard, tendering Unitholders will be allocated a pro
rata share of the Partnership's taxable income or loss with respect to Units
sold pursuant to the Offer through the effective date of the sale.
A Unitholder who acquired Units pursuant to the original offering of Units
by the Partnership will recognize a tax loss on a sale of Units pursuant to the
Offer. Even if the Unitholder is subject to the passive activity loss
limitation (discussed below), such loss generally could be deducted in full in
the year of sale (subject to other applicable limitations, including the
limitation on the deductibility of capital losses, discussed below) provided
the Unitholder sells all of his Units.
In general, the character (as capital or ordinary) of a Unitholder's gain
or loss on a sale of a Unit pursuant to the Offer will be determined by
allocating the Unitholder's amount realized on the sale and his adjusted tax
basis in the Units sold between "Section 751 items," which are "substantially
appreciated inventory" and "unrealized receivables" (including depreciation
recapture) as defined in Code Section 751, and non-Section 751 items. The
difference between the portion of the Unitholder's amount realized that is
allocable to Section 751 items and the portion of the Unitholder's adjusted tax
basis in the Units sold that is so allocable will be treated as ordinary income
or loss, and the difference between the Unitholder's remaining amount realized
and adjusted tax basis will be treated as capital gain or loss assuming the
Units were held by the Unitholder as a capital asset. The Purchaser believes
that any tax loss realized on a sale of Units pursuant to the Offer will be
treated entirely as a capital loss under these rules, although it is possible,
because a Unitholder's adjusted tax basis in the Units sold will be allocated
to Section 751 items based on the Partnership's tax basis in these items, that
a Unitholder may recognize ordinary income with respect to the portion of the
Unitholder's amount realized on the sale of a Unit that is attributable to
Section 751 items while recognizing a capital loss with respect to the balance
of the selling price.
A Unitholder's capital gain (if any) or loss on a sale of Units pursuant to
the Offer will be treated as long-term capital gain or loss if the Unitholder's
holding period for the Units exceeds one year. Under current law (which is
subject to change), long-term capital gains of individuals and other
non-corporate taxpayers are taxed at a maximum marginal federal income tax rate
of 28%, whereas the maximum marginal federal income tax rate for other income
of such persons is 39.6%. Capital losses are deductible only to the extent of
capital gains, except that non-corporate taxpayers may deduct up to $3,000 of
capital losses in excess of the amount of their capital gains against ordinary
income. Excess capital losses generally can be carried forward to succeeding
years (a corporation's carryforward period is five years and a non-corporate
taxpayer can carry forward such losses indefinitely); in addition,
corporations, but not non-corporate taxpayers, are allowed to carry back excess
capital losses to the three preceding taxable years.
Under Code Section 469, a non-corporate taxpayer or personal service
corporation can deduct passive activity losses in any year only to the extent
of such person's passive activity income for such year, and closely held
corporations may not offset such losses against so-called "portfolio" income.
A Unitholder with "suspended" passive activity losses (i.e., net tax losses in
excess of statutorily provided "phase-in" amounts) from the Partnership
generally will be entitled to offset such losses against any income or gain
recognized by the Unitholder on a sale of his Units pursuant to the Offer. If
the Unitholder recognizes a loss on the sale, such loss, together with any
suspended passive activity losses from the Partnership, generally would not be
subject to the passive activity loss limitation, and therefore, could be
deducted in full in the year of sale (subject to any other applicable
limitations), provided the Unitholder sells all his Units. If a Unitholder is
unable to sell all his Units, the deductibility of such losses would continue
to be subject to the passive activity loss limitation until the Unitholder
sells his remaining Units. (See "Section 7. Effects of the Offer".)
A Unitholder (other than corporations and certain foreign individuals) who
tenders Units may be subject to 31% backup withholding unless the Unitholder
provides a taxpayer identification number ("TIN") and certifies that the TIN is
correct or properly certifies that he is awaiting a TIN. A Unitholder may
avoid backup withholding by properly completing and signing the Substitute Form
W-9 included as part of the Letter of Transmittal. If a Unitholder who is
subject to backup withholding does not properly complete and sign the
Substitute Form W-9, the Purchaser will withhold 31% from payments to such
Unitholder.
8
<PAGE> 13
Gain realized by a foreign Unitholder on a sale of a Unit pursuant to the
Offer will be subject to federal income tax. Under Section 1445 of the Code,
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 Purchaser will withhold 10% of the amount realized by a
tendering Unitholder from the Purchase Price payable to such Unitholder unless
the Unitholder properly completes and signs the FIRPTA Affidavit included as
part of the Letter of Transmittal certifying the Unitholder's TIN, that such
Unitholder is not a foreign person and the Unitholder's address.
Amounts withheld would be creditable against a foreign Unitholder's federal
income tax liability and, if in excess thereof, a refund could be obtained from
the Internal Revenue Service by filing a U.S. income tax return.
SECTION 7. EFFECTS OF THE OFFER.
LIMITATIONS ON RESALES. Pursuant to the Partnership Agreement, transfers
of Units which would, in the opinion of counsel to the Partnership, result in
the termination of the Partnership for federal income tax purposes will not be
effective. Depending upon the number of Units tendered pursuant to the Offer,
sales of Units on the secondary market for the twelve-month period following
completion of the Offer may be limited.
EFFECT ON TRADING MARKET. There is no established public trading market
for the Units and, therefore, a reduction in the number of Unitholders should
not materially further restrict the Unitholders' ability to find purchasers for
their Units.
CONTROL OF ALL UNITHOLDER VOTING DECISIONS BY PURCHASER. The Purchaser
currently owns and has the right to vote approximately 20% of the outstanding
Units and accordingly is in a position to significantly influence all voting
decisions with respect to the Partnership. This means that the Purchaser could
(i) prevent non-tendering Unitholders from taking action they desire but that
the Purchaser opposes and (ii) take action desired by the Purchaser but opposed
by non-tendering Unitholders. Under the Partnership Agreement, Unitholders
holding a majority of the Units are entitled to take action with respect to a
variety of matters, including: removal and replacement of the General Partner;
dissolution of the Partnership; sale of all or substantially all of the
Partnership's properties; material changes in the investment objectives and
policies of the Partnership; and most types of amendments to the Partnership
Agreement. When voting on such matters, the Purchaser will vote Units owned
and acquired by it in its interest. The Purchaser will also have the right to
vote each Unit purchased pursuant to the Offer. The acquisition of additional
Units pursuant to the Offer would enhance the Purchaser's voting influence.
The Purchaser intends to vote all of the Units owned by it, including any Units
acquired pursuant to the Offer, in favor of its proposal to remove the General
Partner and replace it with Raleigh GP Corp.
The Units are registered under the Exchange Act, which requires, among
other things, that the Partnership furnish certain information to its
Unitholders and to the Commission and comply with the Commission's proxy rules
in connection with meetings of, and solicitation of consents from, Unitholders.
The Purchaser does not believe that the purchase of Units pursuant to the Offer
will result in the Units becoming eligible for deregistration under Section
12(g) of the Exchange Act.
SECTION 8. FUTURE PLANS. The Purchaser is making the Offer for the
purpose of increasing its equity interest in the Partnership. The Purchaser
has commenced an action in the Court of Chancery of the State of Delaware in
and for New Castle County seeking, among other things, to enjoin the
consummation of the Starwood Financing. The Offer is conditioned upon the
rejection of the Starwood Financing by the Partnership or the issuance of an
injunction enjoining the Starwood Financing. Additionally, the Purchaser is
seeking to acquire control of the business of the Partnership. The Purchaser
has filed preliminary proxy material with the Commission with respect to the
Consent Solicitation which seeks to remove the General Partner and replace it
with Raleigh Realty Management. The Purchaser intends to commence the Consent
Solicitation promptly upon the clearance by the Commission of the preliminary
proxy material and will vote all Units owned by it, including Units acquired in
the Offer, in favor of the removal of the General Partner and its replacement
with Raleigh Realty Management. The consent of holders of a majority of the
Units is required to effect the removal and replacement of the General Partner.
The Offer is not contingent on the success of the Consent Solicitation. If the
General Partner is removed
9
<PAGE> 14
and replaced, Raleigh Realty Management intends to reject the Starwood
Financing and would attempt to pursue alternative financing arrangements for
the benefit of the Partnership and Unitholders.
THIS OFFER DOES NOT CONSTITUTE A PROXY STATEMENT AND UNITHOLDERS CAN ONLY
VOTE TO REMOVE THE GENERAL PARTNER AND REPLACE IT WITH RALEIGH REALTY
MANAGEMENT PURSUANT TO THE CONSENT SOLICITATION.
Except as set forth above, the Purchaser does not have any present plans or
intentions with respect to a merger, reorganization or liquidation of the
Partnership, a sale of assets or refinancing of any of the Partnership's
properties or a change in the capitalization or distribution policy of the
Partnership. However, Unitholders should be aware that on September 13, 1996,
the Purchaser proposed to the General Partner that the Partnership enter into
an agreement with the Purchaser pursuant to which the Partnership and an
affiliate of the Purchaser would combine and Unitholders would have the choice
of receiving either (i) $500 per Unit in cash or (ii) at least $525 per Unit,
comprised of $400 per Unit in cash plus a security of the surviving entity
which would be worth not less than $125 per Unit, or more if the assumptions
with respect to the Units made by Lehman Brothers are attained. The proposal,
which was conditioned on the Starwood Financing not being consummated, was
rejected by the General Partner. Subject to the limitation on resales
discussed in Section 7, the Purchaser may acquire additional Units following
the completion of the Offer. Any such acquisition may be made through private
purchases or by any other means deemed advisable. Any such acquisition may be
at a price higher or lower than the price to be paid for the Units purchased
pursuant to the Offer.
SECTION 9. CERTAIN INFORMATION CONCERNING THE PARTNERSHIP. Information
included herein concerning the Partnership is derived from the Partnership's
publicly-filed reports. Additional financial and other information concerning
the Partnership is contained in the Partnership's Annual Reports on Form 10-K,
Quarterly Reports on Form 10-Q and other filings with the Commission. Such
reports and other documents may be examined and copies may be obtained from the
offices of the Commission at 450 Fifth Street, N.W., Washington, D.C 20549, and
at the regional offices of the Commission located in the Northwestern Atrium
Center, 500 Madison Street, Suite 1400, Chicago, Illinois 60661, and 7 World
Trade Center, New York, New York 10048. Copies should be available by mail
upon payment of the Commission's customary charges by writing to the
Commission's principal offices at 450 Fifth Street, N.W., Washington, D.C.
20549. The Purchaser disclaims any responsibility for the information included
in such reports and extracted in this Offer to Purchase.
The Partnership's Assets and Business
The Partnership was organized in 1987, under the laws of the State of
Delaware. Its principal executive offices are located at 900 N. Michigan
Avenue, Chicago, IL 60611. Its telephone number is (312) 440-4800.
The assets of the Partnership consist principally of interests in land
which is in the process of being developed into master-planned residential
communities (the "Communities") and, to a lesser extent, commercial and
industrial properties; mortgage notes and accounts receivable; construction,
brokerage and other support businesses; real estate assets held for investment;
certain club and recreational facilities; and a cable television business
serving one of its Communities. The Partnership is principally engaged in the
development of comprehensively planned resort and primary home Communities
containing a diversified product mix designed for the middle and upper income
segments of the various markets in which the Partnership operates.
The Partnership sells individual residential lots and parcels of partially
developed and undeveloped land. The third-party builders and developers to
whom the Partnership sells homesites and land parcels are generally smaller
local builders who require project specific financing for their developments
and whose operations are more susceptible to fluctuations in the availability
and terms of financing. In addition, within the Communities, the Partnership
constructs, or causes to be constructed, a variety of products, including
single-family homes, townhouses and condominiums to be developed for sale, as
well as related commercial and recreational facilities. The Communities are
located primarily throughout the State of Florida, with Communities also
located near Atlanta, Georgia and Highlands, North Carolina. Additional
undeveloped properties owned by the Partnership in or near its Communities are
being considered for development as commercial, office and industrial
properties. The
10
<PAGE> 15
Partnership also owns or manages certain club and recreational facilities
within certain of its Communities. Certain assets located in Florida were
acquired by the Partnership from the seller by purchasing a 99.9% interest in a
joint venture partnership in which the General Partner acquired the remaining
joint venture partnership interest. In addition, other assets are owned by
various partnerships, the interests of which are held by certain indirect
subsidiaries of the Partnership and by the Partnership.
The business of the Partnership is cyclical in nature and certain aspects
of the development of Community projects are to some degree seasonal. The
Communities are in various stages of development. The remaining estimated
build-out time for the Communities ranges from one to nine years.
Litigation
The Partnership is a party to numerous litigations. In its Form 10-K for
the fiscal year ended December 31, 1995, the Partnership disclosed the status
of "... a number of homeowner lawsuits, certain of which purported to be class
actions, that allegedly in part arose out of or related to Hurricane Andrew
..."; two subrogation actions, one of which "...plaintiffs seek to recover
damages and pre- and post-judgment interest in connection with $10,873,000 [an
insurance carrier] has allegedly paid, plus amounts it may have to pay in the
future ..."; and a lawsuit filed in October 1995 as a class action in which
"... the multi-count complaint alleges that defendants engaged in various acts
of misconduct in, among other things, the establishment, operation, management
and marketing of the Broken Sound golf course and recreational facilities ..."
and in which "plaintiffs seek ... damages in excess of $45 million, the
appointment of receivers for the Broken Sound Club and Country Club Maintenance
Association, Inc., other unspecified compensatory damages, the right to seek
punitive damages, treble damages, prejudgment interest, attorneys' fees and
costs." In such report, the Partnership also refers to certain other pending
lawsuits and claims against the Partnership.
On September 27, 1996, the Purchaser and an affiliate commenced an action
for declaratory and injunctive relief in the Delaware Chancery Court, New
Castle County, captioned Vanderbilt Income and Growth Associates, L.L.C. et
ano. v. Arvida/JMB Managers, Inc. et al. (C.A. No. 15238). The General
Partner, its directors Judd D. Malkin, Neil G. Bluhm, Burton E. Glazov, Stuart
C. Nathan, A. Lee Sacks and John G. Schreiber, as well as Starwood's principal,
Barry Sternlicht, the Starwood Financing lender and certain of its affiliates,
were named as defendants. The action seeks, among other things, to enjoin the
Starwood Financing. It alleges that as a result of having entered into an
agreement for the Starwood Financing the defendants are engaged in a scheme to
cause the Partnership unnecessarily to incur approximately $160 million in
secured debt on unfavorable terms, including an interest rate which would be
higher than that which presently is available in the market for similar
financings. The action further alleges that the purpose of the Starwood
Financing is to entrench the position of the General Partner and is thus wholly
improper and that the defendants thereby wrongfully have breached, and/or aided
and abetted, participated in and/or induced the wrongful breach of fiduciary
duties owed by the General Partner to the Partnership. In response to the
Purchaser's motion for a temporary restraining order enjoining the closing of
the Starwood Financing, the defendants agreed that, unless the action is
dismissed by the Court, they will not close the Starwood Financing pending a
hearing on the Purchaser's motion for a preliminary injunction scheduled for
November 21, 1996.
11
<PAGE> 16
SELECTED FINANCIAL DATA.
Set forth below is a summary of certain financial data for the Partnership
which has been excerpted from the Partnership's Annual Report on Form 10-K for
the fiscal year ended December 31, 1995, and the Partnership's Quarterly Report
on Form 10-Q for the six months ended June 30, 1996. More comprehensive
financial and other information is included in such reports and other documents
filed by the Partnership with the Commission, and the following summary is
qualified in its entirety by reference to such reports and other documents and
all the financial information and related notes contained therein.
ARVIDA/JMB PARTNERS, L.P.
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
<TABLE>
<CAPTION>
JUNE 30,
--------------------------
1996 1995
------------- -----------
<S> <C> <C>
Total revenue . . . . . . . . . . . . . . . . $ 152,640,781 168,080,598
============= ===========
Net operating income (loss) . . . . . . . . . $ 13,250,562 25,609,606
============= ===========
Equity in earnings (losses) of unconsolidated
ventures . . . . . . . . . . . . . . . . $ (116,913) (1,079,185)
============= ===========
Income before cumulative effect due to change
in accounting for long-lived assets . . . . $ 12,032,717 24,987,008
============= ===========
Cumulative effect due to change in accounting
for long-lived assets . . . . . . . . . . $ - (2,200,000)
------------- -----------
Net income (loss) . . . . . . . . . . . . . . $ 12,032,717 22,787,008
============= ===========
Net income (loss) per Limited Partnership
Interest (a) . . . . . . . . . . . . . . . $ 28.31 55.23
============= ===========
Total assets (b) . . . . . . . . . . . . . . $ 350,198,599 N/A
=============
Total liabilities (b) . . . . . . . . . . . . $ 116,000,000 N/A
=============
Cash distributions per Interest (c) . . . . . $ 25.85 13.49
============= ===========
<CAPTION>
DECEMBER 31,
------------------------------------------------------------------------
1995 1994 1993 1992 1991
============= =========== =========== =========== ===========
<S> <C> <C> <C> <C> <C>
- - - - -
Total revenue . . . . . . . . . . . . . . . . $ 382,267,482 315,058,058 247,651,192 174,710,779 155,699,871
============= =========== =========== =========== ===========
Net operating income (loss) . . . . . . . . . $ 45,181,165 52,676,462 30,689,914 (23,337,245) (11,777,093)
============= =========== =========== =========== ===========
Equity in earnings (losses) of unconsolidated
ventures . . . . . . . . . . . . . . . . $ 1,050,994 524,520 1,134,947 (2,225,531) (769,300)
============= =========== =========== =========== ===========
Income before cumulative effect due to change
in accounting for long-lived assets . . . . $ N/A N/A N/A N/A N/A
Cumulative effect due to change in accounting
for long-lived assets . . . . . . . . . . $ N/A N/A N/A N/A N/A
Net income (loss) . . . . . . . . . . . . . . $ 41,836,686 47,197,532 29,292,050 (43,974,366) (30,667,969)
============= =========== =========== =========== ===========
Net income (loss) per Limited Partnership
Interest (a) . . . . . . . . . . . . . . . $ 101.91 115.37 71.78 (160.42) (74.39)
============= =========== =========== =========== ===========
Total assets (b) . . . . . . . . . . . . . . $ 366,439,241 376,371,712 348,094,995 350,807,538 420,289,287
============= =========== =========== =========== ===========
Total liabilities (b) . . . . . . . . . . . . $ 133,773,954 179,791,958 196,004,818 228,010,419 253,517,802
============= =========== =========== =========== ===========
Cash distributions per Interest (c) . . . . . $ 13.49 6.35 - - -
============= =========== =========== =========== ===========
</TABLE>
- --------------------------
(a) The net income (loss) per Limited Partnership Interest is based upon the
average number of Limited Partner Interests outstanding during each period.
(b) The Partnership does not present a classified balance sheet as a matter of
industry practice, and as such,does not distinguish between current and
non-current assets and liabilities.
(c) Cash distributions from the Partnership are generally not equivalent to
Partnership income as determined for federal income tax purposes as
determined under generally accepted accounting principles. Cash
distributions to the Limited Partners represent a return of capital for
federal income tax purposes. During February 1995, the Partnership made a
distribution for 1994 of $5,421,680 to its Limited Partners ($13.42 per
Interest). In addition, during the first quarter of 1995, the Partnership
remitted each Limited Partner's share of a North Carolina non-resident
withholding tax on behalf of each of the Limited Partners. Each payment,
which totalled $26,704 ($.07 per Interest), was deemed a distribution to
the Limited Partners. During February 1994, the Partnership made a
distribution for 1993 of $2,565,433 to its Limited Partners ($6.35 per
Interest). There were no cash distributions in 1991, 1992 and 1993.
12
<PAGE> 17
SECTION 10. CONFLICTS OF INTEREST.
VOTING BY THE PURCHASER. The Purchaser currently owns approximately 20% of
the outstanding Units and accordingly is in a position to significantly
influence all Partnership decisions on which Unitholders may vote. This means
that (i) non-tendering Unitholders could be prevented from taking action they
desire but that the Purchaser opposes and (ii) the Purchaser may be able to
take action desired by the Purchaser but opposed by the non-tendering
Unitholders. (See "Section 7. Effects of the Offer".) The acquisition of
additional Units pursuant to the Offer would enhance such voting influence.
The Purchaser intends to vote all Units owned by it, including Units acquired
pursuant to the Offer, in favor of a proposal which it is making to remove the
General Partner and replace it with Raleigh Realty Management.
SECTION 11. CERTAIN INFORMATION CONCERNING THE PURCHASER. The Purchaser
was organized for the purpose of acquiring the Units pursuant to the Prior
Tender Offer. The principal executive office of the Purchaser is at One
International Place Boston, Massachusetts 02110. The general partners of the
Purchaser are Raleigh GP Corp., Rockland Partners, Inc. ("Rockland") and
Zephyr Partners ("Zephyr").
Raleigh GP Corp. is a Delaware corporation which is ultimately controlled
by Apollo Real Estate Capital Advisors II, Inc. ("Advisors"), as general
partner of Apollo Real Estate Advisors II, L.P. ("AREA II"), the general
partner of Apollo Real Estate Investment Fund II, L.P., a recently formed
private real estate investment fund and the sole shareholder of Raleigh GP
Corp. Since its inception, the directors of Advisors have been Leon D. Black
and John J. Hannan who were founding principals of Apollo Advisors, L.P., the
respective managing general partner of Apollo Investment Fund, L.P., AIF II,
L.P. and Apollo Investment Fund III, L.P., private securities investment funds,
and, together with William L. Mack, of Apollo Real Estate Advisors, L.P.
("AREA") and AREA II, the respective managing general partners of Apollo Real
Estate Investment Fund, L.P. and Apollo Real Estate Investment Fund II, L.P.
Mr. Mack has been the President and Managing Partner of the Mack Organization,
a national owner and developer of and investor in office and industrial
buildings as well as other commercial properties principally in the New
York/New Jersey metropolitan area as well as throughout the United States since
1963. The business address for Messrs. Black, Hannan and Mack is 1301 Avenue
of the Americas, New York, New York 10019.
Rockland is a Delaware corporation which is wholly-owned by Tiger/Westbrook
Real Estate Fund, L.P. ("TREF"), a Delaware limited partnership and a private
real estate investment fund, Tiger/Westbrook Real Estate Co-Investment
Partnership, L.P. ("TRECIP"), a Delaware limited partnership and a private real
estate investment fund. The sole general partner of each of TREF and TRECIP is
Tiger/Westbrook Real Estate Partners Management, L.L.C., a Delaware limited
liability company ("TREPM"). The sole managing member of TREPM is Westbrook
Real Estate Partners, L.L.C., a Delaware limited liability company ("WREP").
Since its inception, the members of WREP have been Paul D. Kazilionis and
William H. Walton III. The principal business address of TREF, TRECIP, TREPM
and WREP is 599 Lexington Avenue, Suite 3800, New York, New York 10022.
Lennar Corporation ("Lennar"), a Delaware corporation, has a binding agreement
to become a shareholder of Rockland and under that agreement Lennar has funded
its proportionate share of Rockland's capital requirements. Lennar is a
national full-service real estate company with a principal business address at
700 Northwest 107th Avenue, Miami, Florida 33172.
Zephyr is a New York general partnership, the partners of which are GP
Aeolus Inc., a Delaware corporation, and AREHGP INC., a Delaware corporation.
Carl C. Icahn is the controlling shareholder of both GP Aeolus Inc. and
American Property Investors Inc., the general partner of a limited partnership
that owns all of the issued and outstanding stock of AREHGP INC. The principal
business address of Zephyr, AREHGP INC. and GP Aeolus Inc. is 100 South Bedford
Road, Mount Kisco, New York 10549.
For certain information concerning the executive officers and directors of
Raleigh GP Corp., Rockland, GP Aeolus Inc., AREHGP INC. and American Property
Investors Inc., see Schedule 1 to this Offer to Purchase.
13
<PAGE> 18
In December 1994, representatives of AREA, an affiliate of Raleigh GP Corp.
contacted representatives of the General Partner to discuss a possible
transaction involving the acquisition of the Partnership or the General
Partner's interest in the Partnership. Shortly thereafter, such
representatives met to discuss the possibility of such a transaction. At the
meeting, the representatives of the General Partner advised that there was no
interest in any such transaction. No prices were discussed. Since that
meeting, there have been no further discussions between the parties.
In March 1996, Tiger Real Estate Fund, L.P. (now Tiger/Westbrook Real
Estate Fund, L.P.) and certain of its affiliates, all of which are affiliates
of Rockland, together with affiliates of Lennar, purchased all of the
outstanding partnership interests of Coto de Caza Ltd., a California limited
partnership ("Coto de Caza"), from Chevron Land and Development Company and the
Partnership. The Partnership owned 20% of the partnership interests of Coto de
Caza, for which it was paid $12,000,000. In addition, in the Spring of 1996,
Tiger Real Estate Fund, L.P. (now Tiger/Westbrook Real Estate Fund, L.P.) held
preliminary discussions with an affiliate of the Partnership with respect to
managing a to-be-developed residential community in Orlando, Florida. The
discussions have since ceased and the affiliate of the Partnership is no longer
a candidate for managing the proposed project.
During the Prior Tender Offer, the Purchaser engaged in preliminary
discussions with representatives of Walton Street Capital Acquisition Co. III,
L.L.C. and Whitehall Street Real Estate Limited Partnership VII regarding
admission of such parties or affiliates thereof as additional partners of the
Purchaser. No agreement was reached with any of such parties.
On July 16, 1996, Vanderbilt Income & Growth Associates, L.L.C., an
affiliate of the Purchaser ("Vanderbilt"), contacted the Partnership to request
that the Partnership furnish it with a list of the names, addresses and
telephone numbers of, and the number of Units owned by, Unitholders. In
connection with furnishing such list, the Purchaser and the General Partner
entered into an agreement pursuant to which the Purchaser agreed that such list
would be used solely for the purpose of making a tender offer for the Units in
compliance with the requirements of the Exchange Act (the "Specific Purpose")
and would not be furnished to any person other than affiliates and
representatives of the Purchaser for use solely for the Specific Purpose.
On July 17, 1996, the Purchaser sent a letter to the Partnership requesting
that the Partnership require that its financial advisor provide Unitholders
with an estimate of the current fair market value of the Units. By letter
dated July 19, 1996 from the Partnership to the Purchaser, the Partnership
rejected the Purchaser's request. The Purchaser reiterated its request by
letter to the Partnership dated July 22, 1996.
On July 18, 1996, Boreas Partners, L.P. ("Boreas"), an affiliate of Zephyr,
commenced a tender offer (the "Boreas Offer") to purchase up to 185,000 Units
for $460 per Unit. Following negotiations between the Purchaser and Boreas
(and its affiliates), on July 23, 1996 Boreas terminated and withdrew the
Boreas Offer and Zephyr became a general partner of the Purchaser. In
addition, as part of such transactions, Boreas was admitted as a limited
partner of the Purchaser. On June 21, 1996, in anticipation of the
commencement of the Boreas Offer, Longacre Corp. ("Longacre"), an affiliate of
Boreas and Zephyr, contacted the Partnership to request that the Partnership
furnish it with a list of the names, addresses and telephone numbers of, and
the number of Units owned by, Unitholders. In connection with furnishing such
list, Longacre and the General Partner entered into an agreement pursuant to
which Longacre agreed that such list would be used solely for the Specified
Purpose and would not be furnished to any person other than affiliates and
representatives of Longacre for use solely for the Specified Purpose. In
addition, in connection with the Boreas Offer, representatives of Boreas
discussed procedures for transferring tendered Units and related matters with
counsel to the Partnership and its transfer agent.
On August 15, 1996, representatives of the Purchaser met with the General
Partner at the offices of the Partnership in Chicago, Illinois to inquire as to
the terms of the proposed Starwood Financing. At the meeting, the Purchaser's
representatives stated their strenuous objection to the terms of the Starwood
Financing as described to them at such meeting and offered to use the
Purchaser's best efforts to obtain superior financing proposals for the benefit
of the Partnership and its Unitholders. To ensure that the Partnership did not
risk loss of the Starwood proposal if a superior financing facility could not be
obtained, the Purchaser offered to provide to the Partnership
14
<PAGE> 19
financing substantially identical to the Starwood proposal in such an event.
The next day, August 20, 1996, the Purchaser sent a letter to the General
Partner confirming the discussions held at the August 15 meeting.
On August 19, 1996, the General Partner sent a letter to the Purchaser
indicating that although an agreement had not been reached on the Starwood
Financing, the Partnership would not currently negotiate any other offers for
financing similar to the Starwood Financing. The next day, August 20, 1996,
the Purchaser sent another letter to the General Partner in connection with its
proposed replacement financing of the Starwood proposal, offering the
opportunity for all Unitholders to realize $500 per Unit (less the amount to be
received upon acceptance of the Purchaser's financing proposal), to the extent
permitted by the Partnership Agreement. Such supplemental offer was made
subject to the condition that the General Partner accept the Purchaser's
financing proposal.
On September 13, 1996, the Purchaser sent a letter to the General Partner
proposing that the Partnership enter into an agreement with the Purchaser
pursuant to which the Partnership and an affiliate of the Purchaser would
combine and Unitholders would have the choice of receiving either (i) $500 per
Unit in cash or (ii) at least $525 per Unit, composed of $400 per Unit in cash
plus a security of the surviving entity valued at not less than $125 per Unit,
or more if the assumptions made by Lehman Brothers with respect to the Units
are attained. The Purchaser's proposal, which was conditioned on the Starwood
Financing not being consummated, was rejected by the General Partner.
On September 27, 1996, Vanderbilt and the Purchaser commenced an action for
declaratory and injunctive relief in the Delaware Chancery Court, New Castle
County, captioned Vanderbilt Income and Growth Associates, L.L.C., et ano. v.
Arvida/JMB Managers, Inc., et al. (C.A. No. 15238). The General Partner, its
directors Judd D. Malkin, Neil G. Bluhm, Burton E. Glazov, Stuart C. Nathan, A.
Lee Sacks and John G. Schreiber, as well as Starwood's principal, Barry
Sternlicht, the Starwood Financing lender and certain of its affiliates, were
named as defendants. The action seeks, among other things, to enjoin the
Starwood Financing. It alleges that as a result of having entered into an
agreement for the Starwood Financing the defendants are engaged in a scheme to
cause the Partnership unnecessarily to incur approximately $160 million in
secured debt on unfavorable terms, including an interest rate which would be
higher than that which presently is available in the market for similar
financings. The action further alleges that the purpose of the Starwood
Financing is to entrench the position of the General Partner and is thus wholly
improper and that the defendants thereby wrongfully have breached, and/or aided
and abetted, participated in and/or induced the wrongful breach of fiduciary
duties owed by the General Partner to the Partnership.
On October 1, 1996, the Purchaser sent a letter to the General Partner
requesting a list of the names and addresses of, and the number of Units owned
by, Unitholders. After the General Partner failed to respond to this request,
on October 11, 1996, the Purchaser commenced an action in the Delaware Chancery
Court, New Castle County, captioned Raleigh Capital Associates, L.P. v.
Arvida/JMB Managers, Inc. and Arvida/JMB Partners, L.P. The action seeks to
compel the Partnership and the General Partner to provide the Purchaser with a
list of Unitholders.
Except as otherwise set forth herein, (1) neither the Purchaser, Raleigh GP
Corp., Rockland, Zephyr, Advisors, to the best of Purchaser's knowledge, the
persons listed on Schedule 1, nor any affiliate of the foregoing beneficially
owns or has a right to acquire any Units, (2) neither the Purchaser, Raleigh GP
Corp., Rockland, Zephyr, Advisors, to the best of Purchaser's knowledge, the
persons listed on Schedule 1, nor any affiliate thereof or director, executive
officer or subsidiary of Raleigh GP Corp., Rockland, Zephyr, or Advisors has
effected any transaction in the Units within the past 60 days, (3) neither the
Purchaser, Raleigh GP Corp., Rockland, Zephyr, Advisors, to the best of
Purchaser's knowledge, any of the persons listed on Schedule 1, nor any director
or executive officer of Raleigh GP Corp., Rockland, Zephyr, or Advisors has any
contract, arrangement, understanding or relationship with any other person with
respect to any securities of the Partnership, including, but not limited to,
contracts, arrangements, understandings or relationships concerning the transfer
or voting thereof, joint ventures, loan or option arrangements, puts or calls,
guarantees of loans, guarantees against loss or the giving or withholding of
proxies, (4) there have been no transactions or business relationships which
would be required to be disclosed under the rules and regulations of the
Commission between any of the Purchaser, Raleigh GP Corp., Rockland, Zephyr,
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<PAGE> 20
Advisors, or, to the best of Purchaser's knowledge, the persons listed on
Schedule 1, on the one hand, and the Partnership or its affiliates, on the other
hand, and (5) there have been no contracts, negotiations or transactions between
the Purchaser, Raleigh GP Corp., Rockland, Zephyr, Advisors, or, to the best of
Purchaser's knowledge, the persons listed on Schedule 1, on the one hand, and
the Partnership or its affiliates, on the other hand, concerning a merger,
consolidation or acquisition, tender offer or other acquisition of securities,
an election of directors or a sale or other transfer of a material amount of
assets.
The Purchaser currently owns 80,342 Units, 79,696 of which it acquired in
the Prior Tender Offer, 5 of which it acquired in June 1996 from Summit
Ventures, L.P. for $411 per Unit, and 641 of which it acquired in a number of
secondary market transactions between August 21, 1996 and September 26, 1996 at
prices between $450 and $500 per Unit. In addition, Vanderbilt, whose address
is at 100 Jericho Quadrangle, New York, NY 11753, beneficially owns 5 Units;
and Rockland Partners, L.P., an affiliate of Rockland with an address at 101
Park Avenue, 47th Floor, New York, New York 10178, beneficially owns 5 Units
which it acquired in a secondary market transaction in June 1996 for $285 per
Unit.
Raleigh GP Corp., Rockland and Boreas have agreed that, other than on
behalf of the Purchaser, until July 1998 neither they nor their affiliates
will, except under limited circumstances (i) participate in any negotiations or
discussions concerning any purchase of Units or the assets of the Partnership,
(ii) acquire or seek to acquire ownership of any Units or assets of the
Partnership or (iii) seek or propose to influence or control the Partnership's
management or policies pursuant to a proxy or consent solicitation or
otherwise.
SECTION 12. SOURCE OF FUNDS. The Purchaser expects that $50,000,000
(exclusive of fees and expenses) would be required to purchase 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 partners
who have an aggregate net worth substantially in excess of the amount required
to purchase the Units. 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.
SECTION 13. PURCHASE PRICE CONSIDERATIONS.
The Purchaser has set the Purchase Price at $500 net per Unit. The
Purchaser established the Purchase Price for the Offer by analyzing a number of
quantitative and qualitative factors including: (i) the absence of a
significant number of recent secondary market resales of the Units; (ii) the
lack of liquidity of an investment in the Partnership; (iii) the Book Value of
the Units; (iv) the administrative costs of continuing to own the Partnership's
assets through a publicly registered limited partnership; (v) the possibility
that Unitholders may continue to realize taxable income in excess of tax
distributions from the Partnership in future years; and (vi) estimated
transaction costs of completing the Offer.
The Partnership's Form 10-K for the fiscal year ended December 31, 1995
states that "[t]here is no public market for Investors, and it is not
anticipated that a public market for Interests will develop." At present,
privately negotiated sales and sales through intermediaries (e.g., through the
trading system operated by Chicago Partnership Board, Inc., which publishes
sell offers by holders of Units) are the only means available to a Unitholder
to liquidate an investment in Units (other than the Offer) because the Units
are not listed or traded on any exchange or quoted on any NASDAQ list or
system. According to Partnership Spectrum, an independent, third-party
industry publication, between June 1, 1996 and July 31, 1996, a total of 658
Units traded at prices ranging from a low of $245 to a high of $350 per Unit,
with a weighted average of $297.02 per Unit, between April 1, 1996 and May 31,
1996, a total of 2,835 Units traded at prices ranging from a low of $210 to a
high of $315 per Unit, with a weighted average of $285.32 per Unit, and between
February 1, 1996 and March 31, 1996, a total of 2,107 Units traded at prices
ranging from a low of $235 to a high of $279 per Unit, with a weighted average
of $251.67 per Unit. Such gross sales prices reported by Partnership Spectrum
do not necessarily reflect the net sales proceeds received by sellers of Units,
which typically are reduced by commissions and other secondary market
transaction costs to amounts less than the reported prices.
16
<PAGE> 21
The Book Value of each Unit, as reflected on the Partnership's Form 10-Q
for the quarter ended June 30, 1996, was $576 per Unit. The Book Value
represents the portion of the excess of the Partnership's assets over its
liabilities, as determined in accordance with generally accepted accounting
principles, which is attributable to the Units. Book Value does not
necessarily reflect the fair market value of a Unit, which may be higher or
lower than the Book Value depending on several factors, including liquidity of
the Units and external economic and market factors. Book Value also does not
reflect the amount which a Unitholder would ultimately receive if the
Partnership were liquidated. Such amount would likely be affected by several
factors, including the time required to effect a liquidation of the
Partnership's assets and the ability of the Partnership to realize the full
value of its assets as reflected in the Book Value. Furthermore, Book Value
may not take into account liabilities associated with resolution of numerous
pending litigations against the Partnership.
Unitholders should note that while, pursuant to the Partnership Agreement,
the Partnership may continue in existence until December 31, 2087, the General
Partner is obligated to pursue one of the following courses of action on or
prior to October 31, 1997: (i) to cause the Units to be listed on a national
exchange or to be reported by the National Association of Securities Dealers
Automated Quotation System; (ii) to purchase, or cause JMB Realty Corporation
or its affiliates to purchase, all of the Units at their then appraised fair
market value (as determined by an independent nationally recognized investment
banking firm or real estate advisory company); or (iii) to commence a
liquidation in which all of the Partnership's remaining assets will be sold or
disposed of by October 2002. The Partnership in Schedule 14D-9 filed in
connection with the Prior Tender Offer, disclosed that it was the current
intention of the members of a special committee of the General Partner to vote
in favor of a 5 year plan of liquidation to commence on October 31, 1997.
The Purchase Price represents the price at which the Purchaser is willing
to purchase Units. No independent person has been retained to evaluate or
render any opinion with respect to the fairness of the Purchase Price and no
representation is made by the Purchaser or any affiliate of the Purchaser as to
such fairness. The Purchaser did not attempt to obtain current independent
valuations or appraisals of the underlying assets owned by the Partnership.
Other measures of the value of the Units may be relevant to Unitholders.
Unitholders are urged to consider carefully all of the information contained
herein and consult with their own advisors, tax, financial or otherwise, in
evaluating the terms of the Offer before deciding whether to tender Units.
SECTION 14. CONDITIONS OF THE OFFER. Notwithstanding any other term of
the Offer, the Purchaser shall not be required to accept for payment or to pay
for any Units tendered if all authorizations, consents, orders or approvals of,
or declarations or filings with, or expirations of waiting periods imposed by,
any court, administrative agency or commission or other governmental authority
or instrumentality, domestic or foreign, necessary for the consummation of the
transactions contemplated by the Offer shall not have been filed, occurred or
been obtained. Furthermore, notwithstanding any other term of the Offer, the
Purchaser shall not be required to accept for payment or pay for any Units not
theretofore accepted for payment or paid for and may terminate or amend the
Offer as to such Units if, at any time on or after the date of the Offer and as
determined by the Purchaser, any of the following conditions exists:
a. a preliminary or permanent injunction or other order of any
federal or state court, government or governmental authority or agency
shall have been issued and shall remain in effect which (1) makes illegal,
delays or otherwise directly or indirectly restrains or prohibits the
making of the Offer or the acceptance for payment of or payment for any
Units by the Purchaser, (2) imposes or confirms limitations on the ability
of the Purchaser effectively to exercise full rights of ownership of any
Units, including, without limitation, the right to vote any Units acquired
by the Purchaser pursuant to the Offer or otherwise on all matters properly
presented to the Partnership's Unitholders, (3) requires divestiture by the
Purchaser of any Units, (4) causes any material diminution of the benefits
to be derived by the Purchaser as a result of the transactions contemplated
by the Offer, or (5) might materially adversely affect the business,
properties, assets, liabilities, financial condition, operations, results
of operations or prospects of the Purchaser or the Partnership;
b. there shall be any action taken, or any statute, rule,
regulation or order proposed, enacted, enforced, promulgated, issued or
deemed applicable to the Offer by any federal or state court, government or
17
<PAGE> 22
governmental authority or agency, which might, directly or indirectly,
result in any of the consequences referred to in clauses (1) through (5) of
paragraph (a) above;
c. any change or development shall have occurred or been
threatened since the date hereof, in the business, properties, assets,
liabilities, financial condition, operations, results of operations or
prospects of the Partnership, which, in the reasonable judgment of the
Purchaser, is or may be materially adverse to the Partnership, or the
Purchaser shall have become aware of any fact that, in the reasonable
judgment of the Purchaser, does or may have a material adverse effect on
the value of the Units;
d. there shall have occurred (1) any general suspension of
trading in, or limitation on prices for, securities on any national
securities exchange or in the over-the-counter market in the United States,
(2) a declaration of a banking moratorium or any suspension of payments in
respect of banks in the United States, (3) any limitation by any
governmental authority on, or other event which might affect, the extension
of credit by lending institutions or result in any imposition of currency
controls in the United States, (4) a commencement of a war or armed
hostilities or other national or international calamity directly or
indirectly involving the United States, (5) a material change in United
States or other currency exchange rates or a suspension of a limitation on
the markets thereof, or (6) in the case of any of the foregoing existing at
the time of the commencement of the Offer, a material acceleration or
worsening thereof;
e. there shall have been threatened, instituted or pending any
action or proceeding before any court or government agency or other
regulatory or administrative agency or commission or by any other person
challenging the acquisition of any Units pursuant to the Offer, or
otherwise directly or indirectly relating to the Offer, or otherwise, in
the reasonable judgment of the Purchaser, adversely affecting the Purchaser
or the Partnership;
f. the Partnership or the General Partner shall have (1) issued,
or authorized or proposed the issuance of, any Partnership interests of any
class, or any securities convertible into, or rights, warrants or options
to acquire, any such interests or other convertible securities, (2) issued
or authorized or proposed the issuance of any other securities in respect
of, in lieu of, or in substitution for, all or any of the presently
outstanding Units, (3) refinanced any of the Partnership's properties,
other than in the ordinary course of the Partnership's business and
consistent with the past practice, (4) declared or paid any distribution,
other than in cash and consistent with past practice, on any of its
Partnership interests, or (5) authorized, proposed or announced its
intention to propose any merger, consolidation or business combination
transaction, acquisition of assets, disposition of assets or material
change in its capitalization, or any comparable event not in the ordinary
course of business and consistent with past practice;
g. the General Partner shall not have recognized to the
Purchaser's reasonable satisfaction, or agreed to recognize, the
effectiveness of the transfer to the Purchaser of the Units tendered
pursuant to the Offer; or
h. the Partnership shall not have rejected the Starwood Financing
or an injunction enjoining the Starwood Financing shall not have been
issued.
The foregoing conditions are for the sole benefit of the Purchaser and may
be asserted by the Purchaser regardless of the circumstances giving rise to
such conditions or may be waived by the Purchaser in whole or in part at any
time and from time to time in its sole discretion. Any determination by the
Purchaser concerning the events described above will be final and binding upon
all parties.
SECTION 15. CERTAIN LEGAL MATTERS.
GENERAL. Except as set forth in this Section 15, the Purchaser is not
aware of any filings, approvals or other actions by any domestic or foreign
governmental or administrative agency that would be required prior to the
acquisition of Units by the Purchaser pursuant to the Offer. Should any such
approval or other action be required, it is the Purchaser's present intention
that such additional approval or action would be sought. While there is no
18
<PAGE> 23
present intent to delay the purchase of Units tendered pursuant to the Offer
pending receipt of any such additional approval or the taking of any such
action, there can be no assurance that any such additional approval or action,
if needed, would be obtained without substantial conditions or that adverse
consequences might not result to the Partnership's business, or that certain
parts of the Partnership's business might not have to be disposed of or held
separate or other substantial conditions complied with in order to obtain such
approval or action, any of which could cause the Purchaser to elect to
terminate the Offer without purchasing Units thereunder. The Purchaser's
obligation to purchase and pay for Units is subject to certain conditions,
including conditions related to the legal matters discussed in this Section 15.
ANTITRUST. The Purchaser does not believe that the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, is applicable to the
acquisition of Units contemplated by the Offer.
MARGIN REQUIREMENTS. The Units are not "margin securities" under the
regulations of the Board of Governors of the Federal Reserve System and,
accordingly, such regulations are not applicable to the Offer.
STATE TAKEOVER LAWS. A number of states have adopted anti-takeover laws
which purport, to varying degrees, to be applicable to attempts to acquire
securities of corporations which are incorporated in such states or which have
substantial assets, securityholders, principal executive offices or principal
places of business therein. Although the Purchaser has not attempted to comply
with any state anti-takeover statutes in connection with the Offer, the
Purchaser reserves the right to challenge the validity or applicability of any
state law allegedly applicable to the Offer and nothing in this Offer to
Purchase nor any action taken in connection herewith is intended as a waiver of
such right. If any state anti-takeover statute is applicable to the Offer, the
Purchaser might be unable to accept for payment or purchase Units tendered
pursuant to the Offer or be delayed in continuing or consummating the Offer.
In such case, the Purchaser may not be obligated to accept for purchase or pay
for any Units tendered.
SECTION 16. FEES AND EXPENSES. Except as set forth in this Section 16,
the Purchaser will not pay any fees or commissions to any broker, dealer or
other person for soliciting tenders of Units pursuant to the Offer. The
Purchaser has retained The Herman Group, Inc. to act as Information Agent and
as Depositary in connection with the Offer. The Purchaser will pay The Herman
Group, Inc. reasonable and customary compensation for their respective services
in connection with the Offer, plus reimbursement for out-of-pocket expenses.
The Purchaser will also pay all costs and expenses of printing and mailing the
Offer and its legal fees and expenses.
SECTION 17. MISCELLANEOUS. The Purchaser is not aware of any jurisdiction
in which the making of the Offer is not in compliance with applicable law. If
the Purchaser becomes aware of any jurisdiction in which the making of the
Offer would not be in compliance with applicable law, the Purchaser will make a
good faith effort to comply with any such law. If, after such good faith
effort, the Purchaser cannot comply with any such law, the Offer will not be
made to (nor will tenders be accepted from or on behalf of) the holders of
Units residing in such jurisdiction.
No person has been authorized to give any information or to make any
representation on behalf of the Purchaser not contained herein or in the Letter
of Transmittal and, if given or made, such information or representation must
not be relied upon as having been authorized.
The Purchaser has filed with the Commission a Schedule 14D-1, pursuant to
Rule 14d-3 under the Exchange Act, furnishing certain additional information
with respect to the Offer, and may file amendments thereto. The Schedule 14D-
1 and any amendments thereto, including exhibits, may be inspected and copies
may be obtained at the same places and in the same manner as set forth in
Section 9 hereof (except that they will not be available at the regional
offices of the Commission).
Raleigh Capital Associates L.P.
October 17, 1996
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Appendix A
GLOSSARY
ADVISORS: Apollo Real Estate Capital Advisor II, Inc.
AREA: Apollo Real Estate Advisors, L.P.
BOREAS: Boreas Partners, L.P., an affiliate of Zephyr
BOOK VALUE: $576 per Unit
BUSINESS DAY: Any day other than Saturday, Sunday or a federal holiday, and
consists of the time period from 12:01 a.m. through 12:00 Midnight, New York
City time
CODE: The Internal Revenue Code of 1986, as amended
COMMISSION: The Securities and Exchange Commission
CONSENT SOLICITATION: The solicitation by the Purchaser of consents of
Unitholders to remove the General Partner and replace it with Raleigh Realty
Management
DEPOSITARY AND INFORMATION AGENT: The Herman Group, Inc.
ELIGIBLE INSTITUTION: A member firm of a registered national securities
exchange, a member of the National Association of Securities Dealers, Inc., a
commercial bank, savings bank, credit union, savings and loan association or
trust company having an office, branch or agency in the United States
EXCHANGE ACT: Securities Exchange Act of 1934, as amended
EXPIRATION DATE: 12:00 Midnight, New York City Time on November 14, 1996,
unless and as extended
GENERAL PARTNER: Arvida/JMB Managers, Inc., the general partner of the
Partnership
LENNAR: Lennar Corporation
OFFER: This offer of the Purchaser set forth in this Offer to Purchase and the
related Letter of Transmittal, as each may be supplemented or amended from time
to time
OFFER TO PURCHASE: This Offer of the Purchaser
PARTNERSHIP: Arvida/JMB Partners, L.P.
PRIOR TENDER OFFER: The Purchaser's June 19, 1996 offer to purchase up to
185,000 Units for $461 per Unit which expired on August 1, 1996
PURCHASE PRICE: The amount of cash paid to each Unitholder for each Unit
tendered upon consummation of the Offer
PURCHASER: Raleigh Capital Associates L.P.
RALEIGH GP CORP.: Raleigh GP Corp., a general partner of the Purchaser
RALEIGH REALTY MANAGEMENT: Raleigh Realty Management L.P.
ROCKLAND: Rockland Partners, Inc., a general partner of the Purchaser
<PAGE> 25
SPECIFIC PURPOSE: The purpose for which a list of names, addresses and
telephone numbers of, and the number of Units owned by, Unitholders would be
used by the Purchaser, pursuant to an agreement between the Purchaser and the
General Partner
STARWOOD: Starwood Capital Group, L.P.
STARWOOD FINANCING: The financing agreement between the Partnership and BSS.
STARWOOD FLORIDA: Starwood Florida Funding, LLC
TIN: Taxpayer identification number
TRECIP: Tiger/Westbrook Real Estate Co-Investment Partnership, L.P.
TREF: Tiger/Westbrook Real Estate Fund, L.P.
TREPM: Tiger/Westbrook Real Estate Partners Management, L.L.C.
UNITHOLDERS: Holders of Units
UNITS: Limited Partnership Interests and assignee interests therein of the
Partnership
VANDERBILT: Vanderbilt Income and Growth Associates, L.L.C.
WREP: Westbrook Real Estate Partners, L.L.C.
ZEPHYR: Zephyr Partners, a general partner of the Purchaser
2
<PAGE> 26
SCHEDULE 1
EXECUTIVE OFFICERS AND DIRECTORS OF RALEIGH GP CORP.,
ROCKLAND PARTNERS, INC., GP AEOLUS INC., AREHGP INC.
AND AMERICAN PROPERTY INVESTORS INC.
Set forth below is the name, current business address, present principal
occupation, and employment history for at least the past five years of Raleigh
GP Corp., Rockland Partners, Inc., GP Aeolus Inc., AREHGP INC. and American
Property Investors Inc. Each person listed below is a citizen of the United
States.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT; MATERIAL OCCUPATION,
POSITION, OFFICE OR EMPLOYMENT FOR THE PAST FIVE YEARS
RALEIGH GP CORP.
MICHAEL L. ASHNER. Mr. Ashner has been President of Raleigh GP Corp. since
June 1996. Since January 1996, Mr. Ashner has also been President and Chief
Executive Officer of Winthrop Financial Associates, A Limited Partnership
("Winthrop"), which is engaged in the real estate investment business. From
June 1994 until January 1996, Mr. Ashner was a Director, President and
Co-Chairman of National Property Investors, Inc., a privately held real estate
investment firm ("NPI"). Since 1981, Mr. Ashner has also served as President
of Exeter Capital Corporation, a firm which has organized and administered real
estate limited partnerships. Mr. Ashner has substantial investments and
manages numerous partnerships and corporations which own real estate
investments. Mr. Ashner's business address is 100 Jericho Quadrangle, Suite
214, Jericho, New York 11753.
PETER BRAVERMAN. Mr. Braverman has been an officer of Raleigh GP Corp. since
June 1996. Since January 1996, Mr. Braverman has been a Senior Vice President
of Winthrop. From June 1995 until January 1996, Mr. Braverman was a Vice
President of NPI. From June 1991 until March 1994, Mr. Braverman was President
of the Braverman Group, a firm specializing in management consulting for the
real estate and construction industries. From 1988 to 1991, Mr. Braverman was
Vice President and Assistant Secretary of Fischbach Corporation, a publicly
traded, international real estate and construction firm. Mr. Braverman's
business address is 100 Jericho Quadrangle, Suite 214, Jericho, New York 11753.
LEE S. NEIBART. Mr. Neibart has been an officer of Raleigh GP Corp since June
1996 and an officer of Advisors since its inception. Since 1993, Mr. Neibart
has been associated with AREA and since May 1996 with Apollo Real Estate
Advisors II, L.P. ("AREA II") which respectively act as managing general
partner of Apollo Real Estate Investment Fund, L.P. ("Apollo I") and Apollo
Real Estate Investment Fund II, L.P. ("Apollo" and together with Apollo I, the
"Apollo Funds"). The Apollo Funds are private real estate investment funds
formed to invest in direct and indirect real property interests, including
direct property investments and public and private debt and equity securities.
From prior to 1993, Mr. Neibart was Executive Vice President and Chief
Operating Officer of the Robert Martin Company, a private real estate
development and management firm based in Westchester County, New York. Mr.
Neibart received his MBA degree from New York University. Mr. Neibart is also
a director of Capital Apartment Properties, Inc., Roland International, Inc.
and a past President of the NAIOP in New York. Mr. Neibart's business address
is 1301 Avenue of the Americas, New York, New York 10019.
W. EDWARD SCHEETZ. Mr. Scheetz has been an officer and a director of Raleigh
GP Corp. since June 1996 and an officer of Advisors since its inception. Since
1993, Mr. Scheetz has been a principal of AREA and since May 1996 of AREA II
which respectively act as managing general partner of Apollo I and Apollo II.
From prior to 1993, Mr. Scheetz was a principal of Trammell Crow Ventures, a
national real estate investment firm. Mr. Scheetz is also a director of
Capital Apartment Properties, Inc., Roland International, Inc., Koll Management
Services, Inc. and Western Pacific Housing Corp. Mr. Scheetz' business address
is 1301 Avenue of the Americas, New York, New York 10019.
MICHAEL D. WEINER. Mr. Weiner has been an officer and a director of Raleigh
GP Corp. since June 1996 and an officer of Advisors since its inception. Since
1993, Mr. Weiner has been associated with AREA and since May 1996 with AREA II
which respectively act as managing general partner of Apollo I and Apollo II.
In addition, since 1992, Mr. Weiner has been associated with Apollo Advisors,
L.P., which, together with an affiliate, serves as the managing general partner
of Apollo Investment Fund, L.P., AIF II, L.P. and Apollo Investment Fund III,
L.P., private securities investment funds. From prior to 1992, Mr. Weiner was a
partner of the national law firm of Morgan, Lewis & Bockius. Mr. Weiner is also
<PAGE> 27
a director of Applause, Inc., Capital Apartment Properties, Inc., Continental
Graphics Holdings, Inc., Converse, Inc., The Florsheim Shoe Company, Inc. and
Furniture Brands International, Inc. Mr. Weiner's business address is 1999
Avenue of the Stars, Los Angeles, California 90067-6048.
ROCKLAND PARTNERS, INC.
PAUL D. KAZILIONIS. Mr. Kazilionis has been an executive officer and director
of Rockland since its formation and presently a member of the Executive
Committee of Rockland. In December, 1994, Mr. Kazilionis co-founded Tiger Real
Estate Fund, L.P. and has served as managing member of the managing member of
its general partner since inception. In June, 1996, Tiger Real Estate Fund,
L.P. changed its name to Tiger/Westbrook Real Estate Fund, L.P. ("TREF").
Prior to co-founding TREF, Mr. Kazilionis was a Managing Director of Morgan
Stanley Realty and President of the general partner of The Morgan Stanley Real
Estate Fund, L.P. responsible for Morgan Stanley's principal investing in real
estate. Mr. Kazilionis joined Morgan Stanley Realty in 1982. Mr. Kazilionis'
business address is 284 South Beach Road, Hobe Sound, Florida 33455.
WILLIAM H. WALTON III. Mr. Walton has been an executive officer and director
of Rockland since its formation. In December, 1994, Mr. Walton co-founded TREF
and has served as managing member of the managing member of its general partner
since inception. Prior to co-founding TREF, Mr. Walton was a Managing Director
of Morgan Stanley Realty. Mr. Walton joined Morgan Stanley Realty in 1979.
Mr. Walton's business address is 599 Lexington Avenue, Suite 3800, New York,
New York 10022.
JEFFREY M. KAPLAN. Mr. Kaplan has been an executive officer of Rockland since
its formation. Since December, 1994, Mr. Kaplan has been associated with
TREF. Prior to joining TREF, Mr. Kaplan spent seven years at Morgan Stanley &
Co., serving most recently as Director of Acquisitions for The Morgan Stanley
Real Estate Fund, L.P. Mr. Kaplan's business address is 599 Lexington Avenue,
Suite 3800, New York, New York 10022.
JONATHAN H. PAUL. Mr. Paul has been an executive officer and director of
Rockland since its formation. Since December, 1994, Mr. Paul has been
associated with TREF. Prior to joining TREF, Mr. Paul spent almost six years
at Morgan Stanley & Co. in the real estate and corporate finance areas,
including three years with The Morgan Stanley Real Estate Fund, L.P. Mr.
Paul's business address is 599 Lexington Avenue, Suite 3800, New York, New York
10022.
RACHEL V. BRANNAN. Ms. Brannan has been an executive officer and director of
Rockland since its formation. Since December, 1994, Ms. Brannan has been
associated with TREF. Prior to joining TREF, Ms. Brannan worked at Morgan
Stanley & Co. for almost seven years, including four years at Morgan Stanley
Realty. Ms. Brannan's business address is 599 Lexington Avenue, Suite 3800,
New York, New York 10022.
PATRICK K. FOX. Mr. Fox has been an executive officer of Rockland since its
formation. Since February, 1996, Mr. Fox has been associated with TREF. Prior
to joining TREF, Mr. Fox was a partner at the law firm of Jones, Day, Reavis
and Pogue. Mr. Fox joined Jones, Day in 1983. Mr. Fox's business address is
13155 Noel Road, Suite 2300, Dallas, Texas 75240.
STUART A. MILLER. Mr. Miller will be elected as an executive officer and
member of the Executive Committee of Rockland upon completion of Rockland's
transaction with Lennar. Since 1985, Mr. Miller has served as a Vice President
of Lennar and currently heads its Homebuilding and Investment Divisions. Mr.
Miller's business address is 700 Northwest 107th Avenue, Miami, Florida 33172.
GP Aeolus Inc., AREHGP INC. and American Property Investors Inc.
CARL C. ICAHN. Carl C. Icahn has been Chairman of the Board of American
Property Investors Inc. ("API") since November 15, 1990. He is also an
executive officer of AREHGP INC. and is an executive officer and director of GP
Aeolus Inc. Mr. Icahn is also President and a director of Starfire Holding
corporation (formerly Icahn Holding Corporation), a Delaware corporation
("SHC") and Chairman of the Board and a director of various of SHC's
subsidiaries, including ACF Industries, Inc., a New Jersey corporation ("ACF").
SHC is primarily engaged in the business of holding, either indirectly or
through subsidiaries, a majority of the common stock of ACF and its address is
100 South bedford Road, Mount Kisco, New York 10549. Mr. Icahn has also been
Chairman of the Board of Directors of ACF since October 29, 1984 and a director
of ACF since June 29, 1984. ACF is a railroad freight and tank car leasing,
sales and
<PAGE> 28
manufacturing company. He has also been Chairman of the Board of Directors and
President of Icahn & Co., Inc. since 1968. Icahn & Co., Inc. is a registered
broker-dealer and a member of the National Association of Securities Dealers.
In 1979, Mr. Icahn acquired control and presently serves as chairman of he Board
of Directors of Bayswater Realty & Capital Corp., which is a real estate
investment and development company ("Bayswater'). ACF, Icahn & Co., Inc. and
Bayswater are deemed to be directly or indirectly owned and controlled by Carl
C. Icahn. Mr. Icahn was Chief Executive Officer and Member of the Office of the
Chairman of Trans World Airlines, Inc. ("TWA") from November 8, 1988 to January
8, 1993; Chairman of the Board of Directors of TWA from January 3, 1986 to
January 8, 1993 and Director of TWA from September 27, 1985 to January 8, 1993.
Mr. Icahn also has substantial equity interests in and controls various
partnerships and corporations which invest in publicly traded securities. Mr.
Icahn's business address is c/o Icahn Associates Corp., 114 West 47th Street,
New York, New York 10036.
ALFRED D. KINGSLEY. Alfred D. Kingsley has served as Director of API since
November 15, 1990. He was also Vice Chairman of the Board of Directors of TWA
from February 1, 1989 to January 8, 1993 and a Member of the Office of the
Chairman from November 8, 1988 to January 8, 1993. Mr. Kingsley was a director
of TWA from September 27, 1985 to January 8, 1993. He also was a director and
executive officer and Director of Research at Icahn & Co., Inc. and related
entities from 1968 until December 1994. He also has been Vice Chairman of the
Board of Directors of ACF since October 29, 1984 and a director of ACF since
June 29, 1984. Mr. Kingsley has also been a Senior Managing Director of
Greenway Partners, L.P. since May 1993, which invests in publicly traded
securities. Mr. Kingsley's business address is 250 Park Avenue, New York, New
York 10022.
WILLIAM A. LEIDESDORF. William A. Leidesdorf has served as Director of API
since March 26, 1991. Since April 1995, Mr. Leidesdorf has acted as an
independent real estate investment banker. From January 1, 1994 through April
1995, Mr. Leidesdorf was Managing Director of RFG Financial, Inc., a
commercial mortgage company. From September 30, 1991 to December 31, 1993, Mr.
Leidesdorf was Senior Vice President of Palmieri Asset Management Group. From
May 1, 1990 to September 30, 1991, Mr. Leidesdorf was Senior Vice President of
Lowe Associates, Inc., a real estate development company, where he was involved
in the acquisition of real estate and the asset management workout and
disposition of business areas. He also acted as the Northeast Regional
Director for Lowe Associates, Inc. From June 1985 to January 30, 1990, Mr.
Leidesdorf was Senior Vice President and stockholder of Eastdil Realty, Inc., a
real estate company, where he was involved in the asset management workout,
disposition of business and financing areas. During the interim period from
January 30, 1990 through May 1, 1990, Mr. Leidesdorf was an independent
contractor for Eastdil Realty, Inc. on real estate matters. Mr. Leidesdorf's
business address is c/o Richard Plehn, 122 East 42nd Street, Suite 2514, New
York, New York 10168.
JACK G. WASSERMAN. Jack G. Wasserman has served as Director of API since
December 3, 1993. Mr. Wasserman is an attorney and a member of the New York
State Bar and has been with the New York based law firm of Wasserman, Schneider
& Babb since 1966, where he is currently a senior partner. Mr. Wasserman's
business address is 90 John Street, New York, New York 10038.
JOHN P. SALDARELLI. John P. Saldarelli has served as Vice President, Secretary
and Treasurer of API since March 18, 1991 and is an executive officer and
director of AREHGP INC. Mr. Saldarelli was also President of Bayswater Realty
Brokerage Corp. from June 1987 until November 19, 1993 and Vice President of
Bayswater Realty & Capital Corp. from September 1979 until April 15, 1993, both
of which are deemed to be directly or indirectly owned and controlled by Carl
C. Icahn. Mr. Saldarelli's business address is 100 South Bedford Road, Mt.
Kisco, New York 10549.
EDWARD E. MATTNER. Edward E. Mattner is an executive officer of GP Aeolus Inc.
He is a securities trader for various affiliates of Mr. Icahn. Mr. Mattner has
served in this capacity since May 1976. Mr. Mattner's business address is c/o
Icahn Associates Corp., 114 West 47th Street, New York, New York 10036.
<PAGE> 29
The Letter of Transmittal and any other required documents should be sent
or delivered by each Unitholder or his broker, dealer, commercial bank, trust
company or other nominee to the Depositary at the address set forth below:
THE HERMAN GROUP, INC.
By Hand, Mail or Overnight Delivery: 2121 San Jacinto Street
26th Floor
Dallas, Texas 75201
By Facsimile: (214) 999-9348 or (214) 999-9323
For Telephone Information contact the Information Agent at:
(800) 992-6146
Any questions or requests for assistance or for additional copies of
this Offer to Purchase, the Letter of Transmittal and other tender offer
materials may be directed to the Purchaser at the telephone number and address
listed above. You may also contact your broker for assistance concerning the
Offer.
<PAGE> 1
LETTER OF TRANSMITTAL OF LIMITED PARTNERSHIP INTERESTS
AND ASSIGNEE INTERESTS THEREIN
ARVIDA/JMB PARTNERS, L.P.
<TABLE>
<CAPTION>
No. Units Purchase No. of Units Total Purchase Price
Owned Price Per Unit Tendered If all Units Tendered
--------- -------------- ------------ ---------------------
<S> <C> <C> <C> <C>
</TABLE>
(Please indicate changes or corrections to the name and address printed above)
================================================================================
THE OFFER, WITHDRAWAL RIGHTS AND PRORATION PERIOD WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON NOVEMBER 14, 1996 (THE "EXPIRATION DATE") UNLESS
EXTENDED.
To participate in the Offer, a duly executed copy of this Letter of
Transmittal and any other documents required by this Letter of Transmittal must
be received by the Depositary on or prior to the Expiration Date. Delivery of
the Letter of Transmittal or any other required documents to an address other
than as set forth below does not constitute valid delivery. The method of
delivery of all documents is at the election and risk of the tendering
Unitholder. Please use the pre-addressed, postage-paid envelope provided.
This Letter of Transmittal is to be completed by Unitholders of
Arvida/JMB Partners, L.P., a Delaware limited partnership (the "Partnership"),
pursuant to the procedures set forth in the Offer to Purchase (as defined
below). Capitalized terms used herein and not defined herein have the meanings
ascribed to such terms in the Offer to Purchase.
PLEASE CAREFULLY READ THE ACCOMPANYING INSTRUCTIONS
Gentlemen:
The undersigned hereby tenders to Raleigh Capital Associates L.P. (the
"Purchaser"), with an address at One International Place, Boston, Massachusetts
02110, the number of Limited Partnership Interests and Assignee Interests
Therein ("Units") in the Partnership set forth above for a purchase price equal
to $500 per Unit less the amount of any distributions declared or made with
respect to the Units between the Offer Date and the date of payment of the
Purchase Price by the Purchase, net to the seller in cash, without interest upon
the terms and subject to the conditions set forth in the Offer to Purchase,
dated 17, 1996 (the "Offer to Purchase"), and this Letter of Transmittal, as
each may be supplemented or amended from time to time (which together constitute
the "Offer"). Receipt of the Offer to Purchase is hereby acknowledged.
Unitholders who execute this Letter of Transmittal shall be deemed to have
tendered all Units beneficially owned by such Unitholder pursuant to the Offer,
unless otherwise indicated in the "No. of Units Tendered" column.
The undersigned recognizes that, if more than 100,000 Units are validly
tendered prior to or on the Expiration Date and not properly withdrawn, the
Purchaser will, upon the terms of the Offer, accept for payment from among
those Units tendered prior to or on the Expiration Date 100,000 Units 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 withdrawn.
Subject to and effective upon acceptance for payment of any of the Units
tendered hereby, the undersigned hereby sells, assigns and transfers to, or
upon the order of, Purchaser all right, title and interest in and to such Units
which are purchased pursuant to the Offer. The undersigned hereby irrevocably
constitutes and appoints the Purchaser as the Unitholder's proxy and true and
lawful agent and attorney-in-fact of the undersigned with respect to such
Units, with full power of substitution (such power of attorney being deemed to
be an irrevocable power coupled with an interest), including the right, if the
Units are held in an IRA account or pension account, to direct the Unitholder's
custodian to facilitate the transfer of the Units and to deliver such Units and
transfer ownership of such Units on the books of the Partnership, together
with all accompanying evidences of transfer and authenticity, to or upon the
Purchaser and, upon payment of the purchase price in respect of such Units by
the Purchaser, to receive all benefits and otherwise exercise all rights of
beneficial ownership of such Units, including all voting rights, all in
accordance with the terms of the Offer. Upon the purchase of Units pursuant
to the Offer, all prior proxies and consents given by the undersigned with
respect to such Units will be revoked and no subsequent proxies or consents may
be given (and if given will not be deemed effective). In addition, by
executing this Letter of Transmittal, the undersigned assigns to the Purchaser
all of the undersigned's right to receive distributions from the Partnership
with respect to Units which are purchased pursuant to the Offer other than
distributions declared or made between the Offer Date and the date payment of
the Purchase Price by the Purchaser.
The undersigned hereby represents and warrants that the undersigned owns
the Units tendered hereby within the meaning of Rule 13d-3 under the Securities
Exchange Act of 1934, as amended, and has full power and authority to validly
tender, sell, assign and transfer the Units tendered hereby, and that when any
such Units are purchased by the Purchaser, the Purchaser will acquire good,
marketable and unencumbered title thereto, free and clear of all liens,
restrictions, charges, encumbrances, conditional sales agreements or other
obligations relating to the sale or transfer thereof, and such Units will not be
subject to any adverse claim. The undersigned further represents and warrants
that the assignment of Units represented hereby is being made in accordance with
all applicable laws and regulations (including investment suitability
requirements). Upon request, the undersigned will execute and deliver any
additional documents deemed by the Purchaser to be necessary or desirable to
complete the assignment, transfer, or purchase of Units tendered hereby.
The undersigned understands that a tender of Units to the Purchaser will
continue 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 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. All authority herein conferred or agreed to be conferred shall
survive the death or incapacity of the undersigned and any obligations of the
undersigned shall be binding upon the heirs, personal representatives,
successors and assigns of the undersigned. Except as stated in the Offer to
Purchase, this tender is irrevocable.
Upon acceptance of Units by the Purchaser, the Purchaser agrees to be
bound by all of the terms and provisions of the Partnership Agreement.
<PAGE> 2
- --------------------------------------------------------------------------------
SIGNATURE BOX (ALL OWNERS)
(SEE INSTRUCTIONS 2, 3 AND 4 AS NECESSARY)
- --------------------------------------------------------------------------------
Please sign exactly as your name is printed on the front of this Letter of
Transmittal. For joint owners, each joint owner must sign. (See Instruction
2.)
TRUSTEES, EXECUTORS, ADMINISTRATORS, GUARDIANS, ATTORNEYS-IN-FACT, OFFICERS OF
A CORPORATION OR OTHER PERSON ACTING IN A FIDUCIARY OR REPRESENTATIVE CAPACITY,
PLEASE COMPLETE THIS BOX AND SEE INSTRUCTION 2.
The signatory hereto hereby tenders the number of Units indicated in this Letter
of Transmittal to its Purchaser pursuant to the terms of the Offer and
certifies under penalties of perjury the statements in Box A, Box B, and, if
applicable, Box C.
X X
------------------------------------- --------------------------------------
(Signature) (Signature Co-Owner)
Tax I.D. Number X
---------------------
Name and Capacity,
(If other than individuals (Title)
----------------------- ----------------------
Address (Fiduciaries Only):
----------------------------------------------------
(city) (state) (zip)
Area Code and Telephone No. ( ) (Day) ( ) (Evening)
------------------- -------------------
SIGNATURE GUARANTEE (IF REQUIRED)
(See Instruction 2)
Name and Address of Eligible Institution
---------------------------------------
- -------------------------------------------------------------------------------
Authorized Signature Title
---------------------------- -----------------------
Name Date , 1996
-------------------------------------------- ------------------
- --------------------------------------------------------------------------------
FOR INFORMATION CONTACT:
THE HERMAN GROUP, INC.
2121 San Jacinto Street
26th Floor
Dallas, Texas 75201-9821
Telephone: (800) 992-6146
Facsimile: (214) 999-9323
or
(214) 999-9348
(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 DEPOSITARY AT THE ADDRESS LISTED ABOVE.)
BEFORE RETURNING THIS LETTER OF TRANSMITTAL, PLEASE REFER TO THE ACCOMPANYING
INSTRUCTIONS.
2
<PAGE> 3
TAX CERTIFICATIONS
================================================================================
BOX A
SUBSTITUTE FORM W-9
(SEE INSTRUCTION 4 - BOX A)
- --------------------------------------------------------------------------------
The person signing this Letter of Transmittal hereby certifies the following to
the Purchaser under penalties of perjury:
(i) The TIN provided in the Signature Box on the Letter of
Transmittal is the correct TIN of the Unitholder, or if this box [ ] is
checked, the Unitholder has applied for a TIN. If the Unitholder has applied
for a TIN, a TIN has not been issued to the Unitholder, and either: (a) the
Unitholder has mailed or delivered an application to receive a TIN to the
appropriate IRS Center or Social Security Administration Office, or (b) the
Unitholder intends to mail or deliver an application in the near future (it
being understood that if the Unitholder does not provide a TIN to the Purchaser
31% of all reportable payments made to the Unitholder will be withheld until a
TIN is provided to the Purchaser); and
(ii) Unless this box [ ] is checked, the Unitholder is not
subject to Backup Withholding either because the Unitholder: (a) is exempt from
Backup Withholding, (b) has not been notified by the IRS that the Unitholder 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 Unitholder is no
longer subject to Backup Withholding.
Note: Place an "X" in the box in (ii) if you are unable to certify
that the Unitholder is not subject to Backup Withholding.
================================================================================
================================================================================
BOX B
FIRPTA AFFIDAVIT
(SEE INSTRUCTION 4 - BOX B)
- --------------------------------------------------------------------------------
Under Section 1445(e)(5) of the Internal Revenue Code and Treas. Reg.
1.1445-11T(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 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 Unitholder's interest in the
Partnership, the person signing this Leter of Transmittal hereby certifies the
following under penalties of perjury:
(i) Unless this box [ ] is checked, the unitholder, 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 estate or foreign trust (as those terms are defined in the Internal
Revenue Code and Income Tax Regulations); (ii) the Unitholder's U.S. social
security number (for individuals) or employer identification number (for
non-individuals) is correct as provided (or corrected) in this Letter of
Transmittal; and (iii) the Unitholder's home address (for individuals), or
office address (for non-individuals), is correctly printed (or corrected) on
the front 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-9
(SEE INSTRUCTION 4 - BOX C)
- --------------------------------------------------------------------------------
By checking this box [ ], the person signing this Letter of Transmittal hereby
certifies under penalties of perjury that the Unitholder is an "exempt foreign
person" for purposes of the Backup Withholding rules under the U.S. federal
income tax laws, because the Unitholder:
(i) If a non resident alien individual 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.
================================================================================
PLEASE REFER TO ATTACHED INSRUCTIONS ON BACK PAGE
<PAGE> 4
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. DELIVERY OF THE LETTER OF TRANSMITTAL. For your convenience, a
pre-addressed, postage-paid envelope has been enclosed with the Offer to
Purchase. However, to ensure receipt of the Letter of Transmittal, it is
suggested that you use overnight courier delivery 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 must
be received by the Information Agent/Depositary at the address set forth
below before the Expiration Date, Midnight, Eastern Time on November 14,
1996, unless extended. Unitholders who execute this Letter of
Transmittal shall be deemed to have tendered all Units beneficially
owned by such Unitholder pursuant to the Offer unless otherwise
indicated in the "No. of Units Tendered" column.
BY MAIL OR THE HERMAN GROUP, INC.
HAND DELIVERY 2121 San Jacinto Street
26th Floor
Dallas, Texas 75201-9821
BY FACSIMILE: (214) 999-9323
or
(214) 999-9348
(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 DEPOSITARY AT THE ADDRESS LISTED
ABOVE.)
FOR ADDITIONAL INFORMATION CALL: (800) 992-6146
THE METHOD OF DELIVERY OF THE LETTER OF TRANSMITTAL AND ALL OTHER
REQUIRED DOCUMENTS IS AT THE OPTION AND RISK OF THE TENDERING UNITHOLDER
AND 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.
2. SIGNATURE REQUIREMENTS.
INDIVIDUAL AND JOINT OWNERS. After carefully reading and completing the
Letter of Transmittal, in order to tender Units, Unitholder(s) must sign
at the "X" in the SIGNATURE BOX of the Letter of Transmittal. The
signature(s) must correspond exactly with the name printed (or
corrected) on the front of the Letter of Transmittal without any change
whatsoever. If any Units are registered in the names of two or more
joint holders, all such holders must sign the Letter of Transmittal. If
the Letter of Transmittal is signed by the registered Holder of the Units
and the payment is to be made directly to that Holder at its address on
the front of the Letter of Transmittal, then 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.
Similarly, Units are held in an account of a member firm of a registered
national security exchange, a member firm 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.
TRUSTEES, CORPORATIONS AND FIDUCIARIES. Trustees, executors,
administrators, guardians, attorneys-in-fact, officers of a corporation,
authorized partner of a partnership or other persons acting in a
fiduciary or representative capacity must sign at the "X" in the
SIGNATURE BOX and have their signatures guaranteed by an Eligible
Institution, by completing the Signature Guarantee set forth in the
SIGNATURE BOX of the Letter of Transmittal and must submit proper
evidence satisfactory to the Purchaser of their authority to so act.
(SEE INSTRUCTION 3 HEREIN).
3. DOCUMENTATION REQUIREMENTS. In addition to information required to be
completed on the Letter of Transmittal, additional documentation may be
required by the Purchaser under certain circumstances including, but not
limited to those listed below. Questions on documentation should be
directed to The Herman Group, Inc. at (800) 992-6146, Project
Administration Department.
DECEASED OWNER (JOINT TENANT) - Certified Copy of Death Certificate
DECEASED OWNER (OTHERS) - Certified Copy of Death Certificate
(See also Executor/Administrator/
Guardian below).
EXECUTOR/ADMINISTRATOR/GUARDIAN - (i) Certified Copies of court
Appointment Documents for
Executor or Administrator
dated within 60 days; and
(ii) a copy of applicable
provisions of the Will (Title
Page, Executor(s)' powers,
asset distribution); OR
(iii) Certified copy of Estate
distribution documents.
ATTORNEY-IN-FACT - Current Power of Attorney.
CORPORATIONS/PARTNERSHIPS - Certified copy of Corporate
Resolution(s), (with raised
corporate seal), or other evidence
of authority to act. Partnerships
should furnish copy of Partnership
Agreement.
TRUST/PENSION PLANS - Copy of cover page of the Trust or
Pension Plan, along with copy of
the section(s) setting forth names
and powers of Trustee(s) and any
amendments to such sections or
appointment of Successor
Trustee(s).
4. TAX CERTIFICATIONS. Unitholders tendering Units to the Purchaser
pursuant to the Offer must furnish the Purchaser with his, hers or its
Taxpayer Identification Number ("TIN") in the SIGNATURE BOX and certify
under penalties of perjury, the representations in Boxes A, B and, if
applicable, Box C.
U.S. PERSONS. A Unitholder 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, "U.S.
Persons") as those terms are defined in the Internal Revenue 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).
BOX A - Substitute Form W-9. Part (I), Taxpayer Identification Number -
The person signing this Letter of Transmittal must provide to the
Purchaser in the blank provided for that purpose in the SIGNATURE BOX of
the Letter of Transmittal, the Unitholder's correct TIN and certify its
correctness as provided in the SIGNATURE BOX, under penalties of
perjury. If a correct TIN is not provided, penalties may be imposed by
the Internal Revenue Service ("IRS"), in addition to the Unitholder's
being subject to Backup Withholding. Part (ii), Backup Withholding - In
order to avoid 31% federal income tax Backup Withholding, the person
signing this Letter of Transmittal must certify, under penalties of
perjury, that such Unitholder is not subject to Backup Withholding.
Certain Unitholders (including, amoung others, all Corporations and
certain exempt non-profit organizations) 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. 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.
WHEN DETERMINING THE TIN TO BE FURNISHED, PLEASE REFER TO THE FOLLOWING
NOTE AS A GUIDELINE:
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 (not necessary to obtain).
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.
BOX B - FIRPTA Affidavit - Section 1445 of the Internal Revenue Code
requires that Unitholders transferring interests in partnerships with
real estate assets meeting certain criteria, certify under penalty of
perjury, the representations made in Box B, or be subject to withholding
of tax equal to 10% of the Purchase Price for Units purchased. 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. NOTE(S): BOX B, PART (I) SHOULD BE
CHECKED ONLY IF THE UNITHOLDER IS NOT A U.S. PERSON, AS DESCRIBED
THEREIN. CORPORATIONS SHOULD INSERT THE JURISDICTION OF INCORPORATION IN
THE BLANK IN PART (III).
BOX C - Foreign Persons - In order for a Unitholder, who is a Foreign
Person (i.e., not a U.S. Person as defined above) to qualify as exempt
from 31% Backup Withholding, the person signing this Letter of
Transmittal must certify, under penalties of perjury, the statement in
BOX C of this Letter of Transmittal attesting to the Foreign
Unitholder's status by checking the box preceding such statement. UNLESS
THE BOX IS CHECKED, SUCH FOREIGN UNITHOLDER WILL BE SUBJECT TO 31%
WITHHOLDING OF TAX UNDER SECTION 1445 OF THE CODE.
5. 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 Letter of Transmittal will
not be valid until any irregularities have been cured or waived. Neither
the Purchaser nor The Herman Group, Inc., are under any duty to give
notification of defects in a Letter of Transmittal and will incur no
liability for failure to give such notification.
<PAGE> 1
$500 OFFER TO PURCHASE
UNITS OF ARVIDA/JMB PARTNERS, L.P.
BY
RALEIGH CAPITAL ASSOCIATES L.P.
As described in the enclosed materials, RALEIGH CAPITAL ASSOCIATES
L.P. is offering to purchase a limited number of Units, including yours, in
Arvida/JMB Partners, L.P. for $500 per Unit. BY TIMELY ACCEPTING THE OFFER,
Raleigh Capital Associates L.P. would pay you:
<TABLE>
<CAPTION>
Units Owned Price Per Unit Total Purchase Price
----------- -------------- --------------------
<S> <C> <C>
</TABLE>
In reviewing the Offer, you should consider the following:
o THE OFFER WILL PROVIDE YOU WITH AN IMMEDIATE OPPORTUNITY TO LIQUIDATE
YOUR INVESTMENT IN THE PARTNERSHIP WITHOUT THE USUAL DELAYS,
COMMISSION COSTS ASSOCIATED WITH MARKET SALES AND PARTNERSHIP TRANSFER
FEES.
o DURING THE LAST THREE YEARS UNITHOLDERS HAVE BEEN REQUIRED TO REPORT
TAXABLE INCOME OF $274 PER UNIT WHILE ONLY RECEIVING CASH
DISTRIBUTIONS OF LESS THAN $20 PER UNIT.
o UNITHOLDERS WHO ACQUIRED THEIR UNITS IN THE ORIGINAL OFFERING WILL
RECEIVE A SUBSTANTIAL TAX BENEFIT FROM THE SALE OF THEIR UNITS IN
1996.
o BY SELLING UNITS, UNITHOLDERS AVOID THE DELAYS AND COMPLICATIONS IN
PREPARING AND FILING PERSONAL INCOME TAX RETURNS WHICH MAY RESULT FROM
AN INVESTMENT IN THE UNITS AS WELL AS THE POTENTIAL OF FUTURE "PHANTOM"
TAXABLE INCOME.
We suggest that you review the enclosed materials with your personal
financial and tax advisor. After carefully reading the enclosed materials, if
you elect to tender your Units, mail (using the enclosed pre-addressed,
postage-paid envelope) or facsimile a duly completed and executed copy of the
Letter of Transmittal and any documents required by the Letter of Transmittal
to the Depositary at:
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 1-800-992-6146.
RALEIGH CAPITAL ASSOCIATES L.P.
