<PAGE> 1
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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
------------------------
BOSTON FINANCIAL QUALIFIED HOUSING TAX CREDITS L.P. V,
A LIMITED PARTNERSHIP
(NAME OF SUBJECT ISSUER)
EVEREST TAX CREDIT INVESTORS, LLC
EVEREST TAX CREDIT INVESTORS II, LLC
(BIDDERS)
UNITS OF INTEREST
(TITLE OF CLASS OF SECURITIES)
100650407
(CUSIP NUMBER OF CLASS OF SECURITIES)
------------------------
W. ROBERT KOHORST
EVEREST PROPERTIES II, LLC
199 SOUTH ROBLES AVENUE, SUITE 440
PASADENA, CALIFORNIA 91101
(626) 585-5920
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO RECEIVE NOTICES
AND COMMUNICATIONS ON BEHALF OF BIDDER)
------------------------
COPY TO:
PETER J. TENNYSON, ESQ.
VINCENT D. LOWDER, ESQ.
PAUL, HASTINGS, JANOFSKY & WALKER LLP
SEVENTEENTH FLOOR
695 TOWN CENTER DRIVE
COSTA MESA, CALIFORNIA 92626-1924
(714) 668-6200
------------------------
CALCULATION OF FILING FEE
Transaction Valuation*: $2,100,000 Amount of Filing Fee: $420
* For purposes of calculating the filing fee only. This amount assumes the
purchase of 3,500 units of interest of the subject partnership for $600 per
unit in cash. The amount of the filing fee, calculated in accordance with
Rule 0-11(d) under the Securities Exchange Act of 1934, as amended, equals
1/50th of one percent of the aggregate of the cash offered by the bidder.
[ ] 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 the date of its filing.
Amount Previously Paid: Not Applicable Filing Party: Not Applicable
Form or Registration No.: Not Applicable Date Filed: Not Applicable
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<PAGE> 2
SCHEDULE 14D-1
- ---------------------------------------
CUSIP No.: 100650407
- ---------------------------------------
<TABLE>
<C> <S>
- ---------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
EVEREST TAX CREDIT INVESTORS, LLC
- ---------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
- ---------------------------------------------------------------------------------------------
3 SEC USE ONLY
- ---------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
AF
- ---------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS [ ]
REQUIRED PURSUANT TO ITEMS 2(e) OR 2(f)
- ---------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
CALIFORNIA
- ---------------------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
NONE
- ---------------------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) [ ]
EXCLUDES CERTAIN SHARES
- ---------------------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
N/A
- ---------------------------------------------------------------------------------------------
10 TYPE OF PERSON REPORTING
OO
- ---------------------------------------------------------------------------------------------
</TABLE>
2
<PAGE> 3
14D-1
- ---------------------------------------
CUSIP No. 100650407
- ---------------------------------------
<TABLE>
<C> <S>
- ---------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
EVEREST TAX CREDIT INVESTORS II, LLC
- ---------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [X]
(b) [ ]
- ---------------------------------------------------------------------------------------------
3 SEC USE ONLY
- ---------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
AF
- ---------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS [ ]
REQUIRED PURSUANT TO ITEMS 2(e) OR 2(f)
- ---------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
CALIFORNIA
- ---------------------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
NONE
- ---------------------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) [ ]
EXCLUDES CERTAIN SHARES
- ---------------------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
N/A
- ---------------------------------------------------------------------------------------------
10 TYPE OF PERSON REPORTING
OO
- ---------------------------------------------------------------------------------------------
</TABLE>
3
<PAGE> 4
This Tender Offer Statement on Schedule 14D-1 (this "Statement") relates to
an offer by Everest Tax Credit Investors, LLC, a California limited liability
company and Everest Tax Credit Investors II, LLC, a California limited liability
(collectively, the "Purchaser") to purchase up to 3,500 of the units of interest
(the "Units") of the Partnership at $600 per Unit, less the amount of
Distributions (as defined in the Offer to Purchase) per Unit, if any, made by
the Partnership after July 31, 1997 and less any tax credits allocable to
selling Unitholders after September 30, 1997, and less any Partnership transfer
fees, upon the terms and subject to the conditions set forth in the Offer to
Purchase, dated August 11, 1997, as it may be supplemented or amended from time
to time (the "Offer to Purchase"), and the related Agreement of Transfer and
Letter of Transmittal, as it may be supplemented or amended from time to time
(the "Letter of Transmittal," which, together with the Offer to Purchase,
constitutes the "Offer"), copies of which are filed as Exhibits 99.2 and 99.3
hereto, respectively. Capitalized terms used but not defined herein have the
meaning ascribed to them in the Offer to Purchase.
ITEM 1. SECURITY AND SUBJECT COMPANY.
(a) The name of the subject company is Boston Financial Qualified Housing
Tax Credits L.P. V, a Limited Partnership, a Massachusetts limited partnership
(the "Partnership"). The address of the Partnership's principal executive
offices is 101 Arch Street, Boston, Massachusetts 02110.
(b) The class of equity securities to which this Statement relates is the
Units. Reference is hereby made to the information set forth on the cover page
and in the "Introduction" of the Offer to Purchase, which is incorporated herein
by reference.
(c) Reference is hereby made to the information set forth in the
"Introduction -- Purpose of the Offer" and "Determination of Purchase
Price -- Trading History of the Units" of the Offer to Purchase, which is
incorporated herein by reference.
ITEM 2. IDENTITY AND BACKGROUND.
(a)-(d) Reference is hereby made to the information set forth on the cover
page and in the "Certain Information Concerning the Purchaser" and Schedule I
("Directors and Executive Officers") of the Offer to Purchase, which is
incorporated herein by reference.
(e)-(f) During the last five years, neither the Purchaser nor, to the best
of its knowledge, any of the persons listed in Schedule I ("Directors and
Executive Officers") of the Offer to Purchase has been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors) or was a party
to a civil proceeding of a judicial or administrative body of competent
jurisdiction and as a result of such proceeding any such person was or is
subject to a judgment, decree or final order enjoining further violations of, or
prohibiting activities subject to, federal or state securities laws or finding
any violation of such laws.
(g) Reference is hereby made to the information set forth in Schedule I
("Directors and Executive Officers") of the Offer to Purchase, which is
incorporated herein by reference.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY.
(a) None.
(b) Reference is hereby made to the information set forth in "General
Information Concerning the Partnership -- Prior Acquisitions of Units and Prior
Contacts" of the Offer to Purchase, which is incorporated herein by reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) Reference is hereby made to the information set forth in "Certain
Information Concerning the Purchaser -- Source of Funds" of the Offer to
Purchase, which is incorporated herein by reference.
(b)-(c) Not applicable.
4
<PAGE> 5
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSAL OF THE BIDDER.
(a)-(g) Reference is hereby made to the information set forth in the
"Introduction -- Purpose of the Offer," "Future Plans of the Purchaser" and
"Effects of the Offer" of the Offer to Purchase, which is incorporated herein by
reference. Except as set forth in the Offer to Purchase, the Purchaser does not
have any present plans or proposals which would relate to, or would result in,
any transaction, change or other occurrence with respect to the Partnership or
the Units as is listed in paragraphs (a) through (g) of Item 5 of Schedule
14D-1.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
(a)-(b) Reference is hereby made to the information set forth in the
"Introduction" and "Certain Information Concerning the Partnership -- Prior
Acquisitions of Units and Prior Contacts" of the Offer to Purchase, which is
incorporated herein by reference.
ITEM 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
THE SUBJECT COMPANY'S SECURITIES.
None.
ITEM 8. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
Reference is hereby made to the information set forth in "Certain Legal
Matters -- Fees and Expenses" of the Offer to Purchase, which is incorporated
herein by reference.
ITEM 9. FINANCIAL STATEMENTS OF BIDDER.
Not applicable. Certain information regarding the ability of the Purchaser
to finance the Offer is set forth in "Certain Information Concerning the
Purchaser -- Source of Funds" of the Offer to Purchaser and is incorporated
herein by reference. The incorporation by reference herein of the above
referenced information does not constitute an admission that such information is
material to a decision by a holder of the Units as to whether to sell, tender or
hold Units being bought in the Offer.
ITEM 10. ADDITIONAL INFORMATION.
(a) Not applicable.
(b)-(d) Reference is hereby made to the information set forth in "Certain
Legal Matters" of the Offer to Purchase, which is incorporated herein by
reference.
(e) To the best knowledge of the Purchaser, no such proceedings are pending
or have been instituted.
(f) Reference is hereby made to the entire text of the Offer to Purchase
and the related Letter of Transmittal, which are incorporated herein by
reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
<TABLE>
<S> <C>
99.1 Summary Advertisement, dated August 11, 1997.
99.2 Offer to Purchase, dated August 11, 1997.
99.3 Agreement of Transfer and Letter of Transmittal.
99.4 Cover Letter to Unitholders, dated August 11, 1997.
</TABLE>
5
<PAGE> 6
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Dated: August 11, 1997
EVEREST TAX CREDIT INVESTORS, LLC and
EVEREST TAX CREDIT INVESTORS II, LLC
By: EVEREST PROPERTIES II, LLC,
Manager
By: /s/ DAVID I. LESSER
------------------------------------
David I. Lesser
Executive Vice President
6
<PAGE> 7
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- --------------------------------------------------------------------------------
<C> <S>
99.1 Form of Summary Advertisement, dated August 11, 1997
99.2 Offer to Purchase, dated August 11, 1997
99.3 Agreement of Transfer and Letter of Transmittal
99.4 Cover Letter to Unitholders, dated August 11, 1997
</TABLE>
7
<PAGE> 1
EXHIBIT 99.1
THIS ANNOUNCEMENT IS NEITHER AN OFFER TO PURCHASE NOR A SOLICITATION OF AN
OFFER TO SELL UNITS. THE OFFERS ARE BEING MADE SOLELY BY THE OFFERS TO
PURCHASE DATED AUGUST 11, 1997 AND THE RELATED AGREEMENTS OF TRANSFER AND
LETTERS OF TRANSMITTAL AND IS NOT BEING MADE TO, NOR WILL TENDERS BE
ACCEPTED FROM OR ON BEHALF OF UNITHOLDERS THAT RESIDE IN ANY JURISDICTION
IN WHICH MAKING OR ACCEPTING THE OFFERS WOULD VIOLATE THAT JURISDICTION'S
LAWS. IN THOSE JURISDICTIONS WHERE THE LAWS REQUIRE THE OFFERS TO BE MADE
BY A LICENSED BROKER OR DEALER, THE OFFERS SHALL BE DEEMED TO BE MADE ON
BEHALF OF THE PURCHASER, IF AT ALL, ONLY BY ONE OR MORE REGISTERED BROKERS
OR DEALERS LICENSED UNDER THE LAWS OF THE APPLICABLE JURISDICTION.
<TABLE>
<S> <C>
UP TO 3,500 UNITS OF INTEREST UP TO 1,825 UNITS OF INTEREST
IN IN
BOSTON FINANCIAL QUALIFIED HOUSING BOSTON FINANCIAL TAX CREDIT FUND VIII,
TAX CREDITS L.P. V, A LIMITED PARTNERSHIP A LIMITED PARTNERSHIP
AT AT
$600 PER UNIT $840 PER UNIT
</TABLE>
by
EVEREST TAX CREDIT INVESTORS, LLC
EVEREST TAX CREDIT INVESTORS II, LLC
Everest Tax Credit Investors, LLC, a California limited liability company
and Everest Tax Credit Investors II, LLC, a California limited liability company
(collectively, the "Purchaser"), is offering to purchase (i) up to 3,500 units
of interest ("Units") in Boston Financial Qualified Housing Tax Credits L.P. V,
a Limited Partnership, a Massachusetts limited partnership (the "BF V"), at a
cash purchase price of $600 per Unit, and (ii) up to 1,825 Units in Boston
Financial Tax Credit Fund VIII, a Massachusetts limited partnership ("BF VIII"),
at a cash purchase price of $840 per Unit. BF V and BF VIII shall together be
referred to as the "Partnerships." The respective purchase prices shall be
reduced by the amount of the Distributions (as defined in the Offers to
Purchase) per Unit, if any, made by the Partnerships after July 31, 1997, and
less any tax credits allocated to the selling Unitholders after September 30,
1997, and less any transfer fees imposed by the Partnerships for each transfer.
These Offers are upon the terms and subject to the conditions set forth in the
Offers to Purchase dated August 11, 1997, as they may be supplemented or amended
from time to time (the "Offers to Purchase"), and in the related Agreements of
Transfer and Letters of Transmittal, as they may be supplemented or amended from
time to time (the "Letters of Transmittal," which, together with the Offers to
Purchase, constitute the "Offers").
THE OFFERS, WITHDRAWAL RIGHTS AND PRORATION PERIODS WILL EXPIRE AT 12:00
MIDNIGHT, NEW YORK CITY TIME ON TUESDAY, SEPTEMBER 9, 1997 UNLESS THE OFFERS ARE
EXTENDED.
For purposes of the Offers, the Purchaser will be deemed to have accepted
for payment pursuant to the Offers, and thereby purchased, validly tendered
Units if, as and when the Purchaser gives oral or written notice to the
Partnerships of the Purchaser's acceptance for payment of those Units pursuant
to the Offers. Upon the terms and subject to the conditions of the Offers,
payment for Units accepted for payment pursuant to the Offers will be made by
transmitting payments to Unitholders whose Units have been accepted for payment.
The Purchaser is making the Offers in order to acquire a substantial equity
interest in the Partnerships primarily for investment and does not intend to
change current management or the operation of the Partnerships and does not have
plans for any extraordinary transactions involving the Partnerships.
In all cases, payment for Units purchased pursuant to the Offers will be
made only after timely receipt by the Purchaser of a properly completed and duly
executed Letter of Transmittal, together with all documents required by the
Letter of Transmittal. If more than 3,500 Units in BF V or 1,825 Units in BF
VIII are validly tendered and not withdrawn on or prior to the Expiration Date,
the Purchaser will, upon the terms and subject to the conditions of the Offer,
take into account the number of Units tendered, accept and pay for an aggregate
of 3,500 Units or 1,825 Units (as the case may be), pro rata, with appropriate
adjustments to avoid purchases of fractional Units. Under no circumstance will
interest on the respective purchase prices for Units be paid, regardless of any
delay in making the payment to Unitholders.
The term "Expiration Date" means 12:00 Midnight, New York City time, on
Tuesday, September 9, 1997, unless the Purchaser in its sole discretion extends
the period of time during which the respective Offer is open, in which event the
term "Expiration Date" will mean the latest time and date at which the
respective Offer, as so extended by the Purchaser, will expire. Subject to the
applicable regulations of the Securities and Exchange Commission, the Purchaser
expressly reserves the right, at any time, to extend the period of time during
which any Offer is open for any reason, including the occurrence of any of the
events specified in the respective Offer to Purchase, by giving oral or written
notice of the extension to the appropriate Partnership. Any extension will be
followed as promptly as practicable by a press release or public announcement
made no later than 9:00 a.m., New York City time, on the next business day after
the previously scheduled Expiration Date.
Tenders of Units made pursuant to the Offers are irrevocable, except that
Units tendered pursuant to the Offers may be withdrawn at any time on or prior
to the Expiration Date and, unless already accepted for payment by the Purchaser
pursuant to the Offers, and may also be withdrawn at any time after October 10,
1997. For withdrawal to be effective, a written or facsimile transmission notice
of withdrawal must be timely received by the Purchaser at its address set forth
on the back cover of the Offers to Purchase. Any notice of withdrawal must
specify the name of the person(s) 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. Any Units properly withdrawn
will be deemed not validly tendered for purposes of the respective Offer.
Withdrawn Units may be re-tendered, however, at any time prior to the Expiration
Date.
The information required to be disclosed by Rule 14d-6(e)(1)(vii) of the
General Rules and Regulations under the Securities Exchange Act of 1934, as
amended (the "Act"), is contained in the Offers to Purchase and is incorporated
herein by reference.
A request is being made under Rule 14d-5 under the Act, for the use of the
list of the Unitholders for each Partnership for the purpose of disseminating
the Offers to Unitholders. Upon compliance by the Partnerships with the request,
the Offers to Purchase and the Letters of Transmittal and, if required, other
relevant materials will be mailed to registered owners of Units and will be
furnished to brokers, banks and similar persons whose names, or whose nominees,
appear on the list of Unitholders, or, if applicable, who are listed as
participants in a clearing agency's security position listing for subsequent
transmittal to beneficial owners of Units.
Questions and requests for assistance may be directed to the Purchaser at
its address and telephone number set forth below. Requests for copies of the
Offers to Purchase and the related Letters of Transmittal may be directed to the
Purchaser, and copies will be furnished promptly at the Purchaser's expense. The
Purchaser will not pay any fees or commissions to any broker or dealer or any
other person in connection with the solicitation of tenders of Units pursuant to
the Offers.
For further information regarding the Offer contact:
EVEREST PROPERTIES II, LLC
(Manager)
199 South Los Robles Avenue, Suite 440
Pasadena, California 91101
(626) 585-5920
(800) 611-4613 (Toll Free)
August 11, 1997
<PAGE> 1
EXHIBIT 99.2
OFFER TO PURCHASE FOR CASH
UP TO 3,500 UNITS OF
BOSTON FINANCIAL QUALIFIED HOUSING TAX CREDITS L.P. V,
A LIMITED PARTNERSHIP
FOR
$600 PER UNIT
BY
EVEREST TAX CREDIT INVESTORS, LLC
EVEREST TAX CREDIT INVESTORS II, LLC
THE OFFER, WITHDRAWAL RIGHTS AND PRORATION PERIOD WILL EXPIRE AT
12:00 MIDNIGHT, NEW YORK CITY TIME ON TUESDAY, SEPTEMBER 9, 1997
UNLESS THE OFFER IS EXTENDED.
Everest Tax Credit Investors, LLC, a California limited liability company
and Everest Tax Credit Investors II, LLC, a California limited liability company
(collectively, the "Purchaser"), is offering to purchase up to 3,500 units of
interest ("Units") in Boston Financial Qualified Housing Tax Credits L.P. V, a
Limited Partnership, a Massachusetts limited partnership (the "Partnership"), at
a net cash price of $600 per Unit (the "Purchase Price"), less the amount of
Distributions (as defined below) per Unit, if any, made by the Partnership after
July 31, 1997 and less any tax credits (allocable at approximately $12.58 per
month) allocated to selling Unitholders after September 30, 1997, and less any
transfer fees imposed by the Partnership for each transfer. The Offer is subject
to certain terms and conditions. This Offer is upon the terms set forth in this
Offer to Purchase (the "Offer to Purchase") and in the related Agreement of
Transfer and Letter of Transmittal (the "Letter of Transmittal"), as each may be
supplemented or amended from time to time. The Offer to Purchase and the Letter
of Transmittal constitute the "Offer." The Offer is not conditioned upon
financing.
------------------------
For More Information or for Further Assistance Please Call
or Contact the Purchaser:
EVEREST PROPERTIES II, LLC
(MANAGER)
199 SOUTH LOS ROBLES AVENUE
SUITE 440
PASADENA, CALIFORNIA 91101
(626) 585-5920
(800) 611-4613 (TOLL FREE)
August 11, 1997
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
INTRODUCTION.......................................................................... 1
PURPOSE OF THE OFFER
DETAILS OF THE OFFER.................................................................. 2
1. TERMS OF THE OFFER; EXPIRATION DATE..................................... 2
2. ACCEPTANCE FOR PAYMENT AND PAYMENT OF PURCHASE PRICE.................... 2
3. PROCEDURE TO ACCEPT THE OFFER........................................... 3
4. DETERMINATION OF VALIDITY; REJECTION OF UNITS; WAIVER OF DEFECTS; NO
OBLIGATION TO GIVE NOTICE OF DEFECTS.................................... 3
5. WITHDRAWAL RIGHTS....................................................... 4
6. EXTENSION OF TENDER PERIOD; TERMINATION; AMENDMENT...................... 4
7. CONDITIONS OF THE OFFER................................................. 5
8. BACKUP FEDERAL INCOME TAX WITHHOLDING................................... 6
9. FIRPTA WITHHOLDING...................................................... 6
CERTAIN INFORMATION CONCERNING THE PARTNERSHIP........................................ 6
GENERAL
OUTSTANDING UNITS
SELECTED FINANCIAL AND PROPERTY RELATED DATA
PRIOR ACQUISITIONS OF UNITS AND PRIOR CONTACTS
DETERMINATION OF PURCHASE PRICE....................................................... 7
TRADING HISTORY OF THE UNITS
CERTAIN INFORMATION CONCERNING THE PURCHASER.......................................... 8
THE PURCHASER
GENERAL
SOURCE OF FUNDS
FUTURE PLANS OF THE PURCHASER......................................................... 9
EFFECTS OF THE OFFER.................................................................. 9
CERTAIN FEDERAL INCOME TAX MATTERS.................................................... 9
CERTAIN LEGAL MATTERS................................................................. 11
GENERAL
STATE TAKEOVER STATUTES
FEES AND EXPENSES
MISCELLANEOUS
SCHEDULE I -- DIRECTORS AND EXECUTIVE OFFICERS........................................ 12
APPENDIX A -- SELECTED FINANCIAL DATA................................................. 14
</TABLE>
i
<PAGE> 3
INTRODUCTION
The Purchaser hereby offers to purchase up to 3,500 Units in the
Partnership at a cash purchase price of $600 per Unit, less the amount of
Distributions per Unit, if any, made by the Partnership after July 31, 1997,
less tax credits allocated after September 30, 1997, and less any transfer fees
imposed by the Partnership for each transfer.
Purpose of the Offer. The purpose of the Offer is for the Purchaser to
acquire a substantial equity interest in the Partnership primarily for
investment.
In considering the Offer, holders of Units ("Unitholders") may wish to
consider the following:
- The cash purchase price proposed by the Purchaser exceeds by $45 per Unit
the price recently offered by an affiliate of the General Partner.
- Tendering Unitholders will be deemed to have withdrawn any previous
tenders of their Units to an affiliate of the General Partner. The
Purchaser will send the notice of such withdrawal. Certain risks
associated with the withdrawal of Units are discussed in Section 1 under
"DETAILS OF THE OFFER."
- The Partnership's publicly filed documents state that there is no
established public trading market for the Units. Consequently, the Offer
presents an opportunity to dispose of Units for cash that might not be
available otherwise.
- According to the General Partner's affiliate in its offer dated July 24,
1997 (the "Prior Offer"), the present value of the remaining tax credits
in the Partnership is $526 (using a 6.44% discount rate).
- Unitholders who tender all of their Units may be able to offset capital
gains and ordinary income to the extent of their unused passive activity
losses. According to the Prior Offer, such offset may equal approximately
$493 per Unit for Units held since inception. See "CERTAIN FEDERAL INCOME
TAX MATTERS."
- The Purchaser is making the Offer with a view to making a profit for
itself. Accordingly, there is a conflict between the desire of the
Purchaser to purchase Units at a low price and the desire of the
Unitholders to sell their Units at a high price.
- The Offer allows Unitholders to dispose of their Units without incurring
the sales commissions (approximately 5% to 9%) typically associated with
transfers of Units arranged through brokers or other intermediaries.
- Sellers of Units can avoid the risk of tax credit recapture after 1997.
- The Offer is an immediate opportunity for Unitholders to liquidate their
investments in the Partnership, but Unitholders who tender their Units
will be giving up the opportunity to participate in any potential future
benefits, including allocations of tax credits, from ownership of Units.
- Unitholders who accept the Offer will likely receive no further
Partnership K-1's after the 1997 K-1.
Each Unitholder must make its own decision, based on the Unitholder's
particular circumstances, whether to tender Units and, if so, how many Units to
tender. Unitholders should consult with their respective advisors about the
financial, tax, legal and other implications of accepting the Offer.
DETAILS OF THE OFFER
1. Terms of the Offer; Expiration Date; Proration. On the terms and
subject to the conditions of the Offer, the Purchaser will accept and purchase
up to 3,500 Units that are validly tendered in accordance with the procedures
set forth in Section 3 on or prior to the Expiration Date and not withdrawn in
accordance with the procedures set forth in Section 5. For purposes of the
Offer, the term "Expiration Date" means 12:00 Midnight, New York City time on
Tuesday, September 9, 1997, unless the Purchaser in its sole
1
<PAGE> 4
discretion extends the period of time during which the Offer is open, in which
event the term "Expiration Date" shall mean the latest time and date at which
the Offer, as extended by the Purchaser, shall expire.
If, prior to the Expiration Date, the Purchaser increases the Purchase
Price offered to the Unitholders pursuant to the Offer, the increased Purchase
Price will be paid for all Units accepted for payment pursuant to the Offer,
whether or not the Units were tendered prior to the increase in consideration.
If more than 3,500 Units are validly tendered in accordance with the
procedures specified in Section 3 and not properly withdrawn in accordance with
the procedures specified in Section 5 on or prior to the Expiration Date, (or if
the number of units tendered would be in excess of the number that can be
transferred without imposing limitations on resales) the Purchaser will, upon
the terms and subject to the conditions of the Offer, take into account the
number of Units so tendered, accept for payment and pay for an aggregate of
3,500 Units, pro rata, according to the number of Units validly tendered by each
Unitholder and not properly withdrawn on or prior to the Expiration Date, with
appropriate adjustments to avoid purchases of fractional Units. If the number of
Units validly tendered and not properly withdrawn on or prior to the Expiration
Date is less than or equal to 3,500 Units, the Purchaser will purchase all Units
so tendered and not withdrawn, upon the terms and subject to the conditions of
the Offer.
All Units tendered pursuant to the Offer shall be immediately withdrawn by
the Purchaser from the Prior Offer. The number of Units sought in the Prior
Offer is higher than that in the Offer. Accordingly, if proration of the
tendered Units is required under the Offer, a tendering Unitholder may receive
payment for less Units pursuant to the Offer than the Unitholder would have
received under the Prior Offer if the Units had not been withdrawn. In such
event the excess Units shall be retained by the Unitholder.
If proration of tendered Units is required, the Purchaser may not be able
to announce the final results of the proration until at least approximately
seven business days after the Expiration Date because of the difficulty of
determining the proration results. The Purchaser does not intend to pay for any
Units accepted for payment pursuant to the Offer until the final proration or
other adjustment results are known.
If on or prior to the Expiration Date any or all of the conditions have not
been satisfied or waived, the Purchaser reserves the right to: (i) decline to
purchase any of the Units tendered, terminate the Offer and return all tendered
Units, (ii) waive the unsatisfied conditions and, subject to complying with
applicable rules and regulations of the Securities and Exchange Commission (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,
retain the Units that have been tendered during the period or periods for which
the Offer is extended, and (iv) amend the Offer.
2. Acceptance for Payment and Payment of Purchase Price. On the terms and
subject to the conditions of the Offer, the Purchaser will purchase and will pay
for up to 3,500 Units validly tendered in accordance with the procedures set
forth in Section 3 and not withdrawn in accordance with the procedures specified
in Section 5, as promptly as practicable following the Expiration Date. In all
cases, payment for Units purchased pursuant to the Offer will be made only after
timely receipt by the Purchaser of: (i) a properly completed and duly executed
and acknowledged Letter of Transmittal (or facsimile thereof) and (ii) any other
documents required in accordance with the Letter of Transmittal.
UNDER NO CIRCUMSTANCE WILL INTEREST ON THE PURCHASE PRICE BE PAID,
REGARDLESS OF ANY EXTENSION OF THE OFFER OR ANY DELAY IN MAKING SUCH PAYMENT.
If any tendered Units are not purchased for any reason (other than
proration adjustments), the original Letter of Transmittal with respect to the
Units may be destroyed by the Purchaser. If for any reason acceptance of 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,
then, without prejudice to the Purchaser's rights under Section 4, the Purchaser
may, nevertheless, retain documents concerning tendered Units, and those Units
may not be withdrawn except to the extent that the tendering Unitholders are
entitled to withdrawal rights as described in Section 5; subject, however, to
the Purchaser's obligation under
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Rule 14e-1(c) under the Exchange Act to pay Unitholders the Purchase Price in
respect of Units tendered or return documents, if any, representing those Units
promptly after termination or withdrawal of the Offer.
3. PROCEDURE TO ACCEPT THE OFFER. FOR UNITS TO BE VALIDLY TENDERED
PURSUANT TO THE OFFER THE PURCHASER MUST RECEIVE, AT THE ADDRESS LISTED ON THE
BACK PAGE OF THIS OFFER TO PURCHASE ON OR PRIOR TO THE EXPIRATION DATE, A
PROPERLY COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL, THE ORIGINAL
PARTNERSHIP CERTIFICATE (IF AVAILABLE), AND ALL DOCUMENTS REQUIRED BY THE LETTER
OF TRANSMITTAL.
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 Purchaser. If delivery is
by mail, registered mail with return receipt requested, properly insured, is
recommended. In all cases, sufficient time should be allowed to assure timely
delivery.
UNITHOLDERS WHO WANT TO PARTICIPATE IN THIS OFFER AND HAVE TENDERED IN THE
PRIOR OFFER MUST DELIVER A PROPERLY COMPLETED AND DULY EXECUTED LETTER OF
TRANSMITTAL TO THE PURCHASER NOT LATER THAN AUGUST 20, 1997 TO ASSURE TIMELY
WITHDRAWAL OF THE PRIOR TENDER.
A Unitholder may tender any or all of the Units owned by that Unitholder.
By executing and delivering a Letter of Transmittal, a tendering Unitholder
irrevocably appoints the Purchaser and its officers, and each of them or any
other designee of the Purchaser, the attorneys-in-fact and proxies of the
Unitholders, in the manner set forth in the Letter of Transmittal, each with
full power of substitution, to the full extent of the Unitholder's rights with
respect to the Units tendered by the Unitholder and accepted for payment by the
Purchaser (and with respect to any and all distributions, other Units, rights or
other securities issued or issuable in respect thereof; collectively,
"Distributions"), including without limitation the right to direct any IRA
custodian, trustee or other record owner to execute and deliver the Letter of
Transmittal, the right to immediately cause the original or a copy of the Letter
of Transmittal to be transmitted to The Herman Group or any other agent of
Oldham Institutional Tax Credits LLC ("Oldham") to accomplish a withdrawal of
any previous tender of the Unitholder's units and to complete the transfer
contemplated thereby. All such proxies will be considered coupled with an
interest in the tendered Units, are irrevocable and are granted in consideration
of, and are effective upon, the acceptance for payment of the Units by the
Purchaser in accordance with the terms of the Offer. Upon acceptance for
payment, all prior powers of attorney and proxies given by the Unitholder with
respect to the Units and Distributions will, without further action, be revoked,
and no subsequent powers of attorney or proxies may be given (and, if given,
will be without force or effect). The designees of the Purchaser will, with
respect to the Units for which the appointment is effective, be empowered to
exercise all voting and other rights of the Unitholder as they in their sole
discretion may deem proper at any meeting of the Partnership or any adjournment
or postponement thereof. In order for Units to be deemed validly tendered,
immediately upon the Purchaser's acceptance for payment of the Units, the
Purchaser or its designee must be able to exercise full voting rights with
respect to the Units, including voting at any meeting of the Partnership's
Limited Partners.
By executing and delivering a Letter of Transmittal, a tendering Unitholder
irrevocably assigns to the Purchaser and its assigns all of the right, title and
interest of the Unitholder in and to any and all Distributions or tax credit
allocations made by the Partnership from and after the date of acceptance with
respect to Units accepted for payment and thereby purchased by the Purchaser.
4. Determination of Validity; Rejection of Units; Waiver of Defects; No
Obligation to Give Notice of Defects. All questions about the validity, form,
eligibility (including time of receipt) and acceptance for payment of any tender
of Units pursuant to the Offer will be determined by the Purchaser, in its sole
discretion, which determination will be final and binding. The Purchaser
reserves the absolute right to reject any or all tenders of any particular Units
determined by it not to be in proper form or if the acceptance of or payment for
those Units may, in the opinion of Purchaser's counsel, be unlawful. The
Purchaser also reserves the absolute right to waive or amend any of the
conditions of the Offer that it is legally permitted to waive and to waive any
defect in any tender with respect to any particular Units. The Purchaser's
interpretation of the terms and conditions of the Offer (including the Letter of
Transmittal) will be final and binding. No tender of Units will be deemed to
have been validly made until all defects have been cured or waived. Neither the
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Purchaser nor any other person will be under any duty to give notification of
any defects in the tender of any Units or will incur any liability for failure
to give any such notification.
A tender of Units pursuant to the procedure described above and the
acceptance for payment of such Units will constitute a binding agreement between
the tendering Unitholder and the Purchaser on the terms set forth in the Offer.
For purposes of the Offer, the Purchaser will be deemed to have accepted
for payment pursuant to this Offer, and thereby purchased, validly tendered
Units if, as and when the Purchaser gives written notice to the Partnership or
its Transfer Agent of the Purchaser's acceptance of those Units for payment
pursuant to the Offer. Upon the terms and subject to the conditions of the
Offer, payment for Units accepted for payment pursuant to the Offer will be made
by transmitting those payments to Unitholders whose Units have been accepted for
payment.
5. Withdrawal Rights. Tenders of Units made pursuant to the Offer are
irrevocable, except that Units tendered pursuant to the Offer may be withdrawn
at any time on or prior to the Expiration Date and, unless already accepted for
payment by the Purchaser pursuant to the Offer, may also be withdrawn at any
time after October 10, 1997. If purchase of, or payment for, Units is delayed
for any reason, including extension by the Purchaser of the Expiration Date, or
if the Purchaser is unable to purchase or pay for Units for any reason (for
example, because of proration adjustments) then, without prejudice to the
Purchaser's rights under the Offer, tendered Units may be retained by the
Purchaser and may not be withdrawn, except to the extent that tendering
Unitholders are entitled to withdrawal rights as set forth in this Section 5;
subject, however, to the Purchaser's obligation, pursuant to Rule 14e-1(c) under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), to pay
Unitholders the Purchase Price in respect of Units tendered promptly after
termination or withdrawal of the Offer.
For withdrawal to be effective, a written or facsimile transmission notice
of withdrawal must be timely received by the Purchaser at its address listed on
the back cover of this Offer to Purchase. Any notice of withdrawal must specify
the name of the person(s) 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. Any Units properly withdrawn will be
deemed not validly tendered for purposes of the Offer. Withdrawn Units may be
re-tendered, however, by following the procedures described in Section 3 at any
time prior to the Expiration Date.
All questions about the validity and form (including time of receipt) of
notices of withdrawal will be determined by the Purchaser, in its sole
discretion, which determination shall be final and binding. Neither the
Purchaser nor any other person will be under any duty to give notice of any
defects in any notice of withdrawal or incur any liability for failure to give
any such notice.
6. Extension of Tender Period; Termination; Amendment. The Purchaser
expressly reserves the right, in its sole discretion, at any 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, (iii) upon
the occurrence of any of the conditions specified in Section 7, 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
extension, 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, the 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. 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.
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7. Conditions of the Offer. Notwithstanding any other term of the Offer,
the Purchaser will not be required to accept for payment or to pay for any Units
tendered if all authorizations, consents, orders of, or filings with, or
expirations of waiting periods imposed by, any court, administrative agency or
other governmental authority necessary for the consummation of the transactions
contemplated by the Offer shall not have occurred or been filed, or obtained.
Furthermore, notwithstanding any other term of the Offer and in addition to the
Purchaser's right to withdraw the Offer at any time before the Expiration Date,
the Purchaser will not be required to accept for payment or pay for any Units,
or may delay the acceptance for payment of the Units tendered if, at any time on
or after the date of the Offer and before the acceptance of such Units for
payment or the payment therefor, any of the following conditions exists:
(a) a preliminary or permanent injunction or other order of any
federal or state court, government or governmental agency shall have been
issued and shall remain in effect which: (i) makes illegal, delays or
otherwise directly or indirectly restrains or prohibits the making of the
Offer or the acceptance for payment, purchase of or payment for any Units
by the Purchaser, (ii) imposes or confirms limitations on the ability of
the Purchaser effectively to exercise full rights of both legal and
beneficial ownership of the Units, (iii) requires divestiture by the
Purchaser of any Units, (iv) causes any material diminution of the benefits
to be derived by the Purchaser as a result of the transactions contemplated
by the Offer, (v) might materially adversely affect the business,
properties, assets, liabilities, financial condition, operations, results
of operations or prospects of the Purchaser, or the Partnership, or (vi)
seeks to impose any material condition to the Offer unacceptable to the
Purchaser;
(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
governmental authority or agency which might, directly or indirectly,
result in any of the consequences referred to in clauses (i) through (vi)
of paragraph (a) above;
(c) any change or development shall have occurred or been threatened
or disclosed in the business, properties, assets, liabilities, financial
condition, operations, results of operations or prospects of the
Partnership, which is or may be materially adverse to the Partnership, or
there shall be any material lien not disclosed in the Partnership's
financial statements, or the Purchaser shall have become aware of any fact
that does or may have a material adverse effect on the value of the Units
or the Properties;
(d) the General Partner of the Partnership shall have failed or
refused to take all other action that the Purchaser deems necessary, in the
Purchaser's judgment, for the Purchaser to be the registered owner of the
Units tendered and accepted for payment hereunder simultaneously with the
consummation of the Offer or as soon thereafter as is permitted under the
Partnership Agreement as in accordance with the Partnership Agreement and
applicable law;
(e) there shall have been threatened, instituted or pending any action
or proceeding before any court or governmental 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 sole judgment of the
Purchaser, adversely affecting the Purchaser, the Partnership or the
Properties or the value of the Units or the benefits expected to be derived
by the Purchaser as a result of the transactions contemplated by the Offer;
(f) the Partnership shall have (i) 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, (ii) 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,
(iii) declared or paid any Distribution, other than in cash, on any of the
Units, or (iv) the Partnership or the General Partner shall have
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; or
(g) the General Partner shall have modified, or taken any step or
steps to modify, in any way, the procedures or regulations applicable to
the registration of Units or transfers of Units on the books and
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<PAGE> 8
records of the Partnership or the admission of transferees of Units as
registered owners and as Unitholders.
The foregoing conditions are for the sole benefit of the Purchaser and may
be (but need not 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 in its sole discretion. Any determination by the Purchaser
concerning the events described above will be final and binding upon all
parties.
8. Backup Federal Income Tax Withholding. To prevent the possible
application of backup federal income tax withholding of 31 percent with respect
to payment of the Purchase Price, a tendering Unitholder must provide the
Purchaser with the Unitholder's correct taxpayer identification number in the
space provided in the Letter of Transmittal.
9. FIRPTA Withholding. To prevent the withholding of federal income tax in
an amount equal to ten percent of the amount of the Purchase Price plus
Partnership liabilities allocable to each Unit purchased, the Letter of
Transmittal includes FIRPTA representations certifying the Unitholder's taxpayer
identification number and address and that the Unitholder is not a foreign
person.
CERTAIN INFORMATION CONCERNING THE PARTNERSHIP
Information contained in this section is based upon documents and reports
publicly filed by the Partnership. Although the Purchaser has no information
that any statements contained in this section are untrue, the Purchaser has not
independently investigated the accuracy of statements, and takes no
responsibility for the accuracy, inaccuracy, completeness or incompleteness of
any of the information contained in this section or for the failure by the
Partnership to disclose events which may have occurred and may affect the
significance or accuracy of any such information.
General. The Partnership was formed in 1989 under the laws of the State of
Massachusetts. Its principal executive offices are located at 101 Arch Street,
Boston, Massachusetts 02110. The Managing General Partner of the Partnership is
Arch Street V, Inc. (the "General Partner"), which is an affiliate of The Boston
Financial Group Limited Partnership.
The Partnership was formed to invest, as a limited partner, in other
limited partnerships (referred to herein as "Local Limited Partnerships") each
of which owns one or more leveraged low-income multifamily residential complexes
("Apartment Complexes" or "Properties") that are eligible for low-income housing
tax credit ("Low Income Housing Credit") enacted in the Tax Reform Act of 1986,
some of which were eligible for the historic rehabilitation tax credit
("Rehabilitation Tax Credit"). Some of the Apartment Complexes benefit from one
or more other forms of federal or state housing assistance. The Partnership's
interest in profits and losses from normal operations and Low-Income Housing
Credits in each Local Limited Partnership is equal to 99% of such items with the
exception of two Local Limited Partnerships, in one of those two Local Limited
Partnerships the Partnership's interest in such items is equal to 95% of such
items and in the other the Partnership's interest in such items is equal to
88.6% of such items. According to the Form 10-K, as of March 31, 1997, all of
the net proceeds from the original offering of Units was invested in 27 Local
Limited Partnerships. The Partnership does not anticipate making any additional
investments.
SLP, Inc. is the special limited partner in all 27 Local Limited
Partnerships and is an affiliate of each General Partner of the Partnership.
SLP, Inc. has certain rights and obligations in its role as special limited
partner which permit SLP, Inc. to execute control over the management and
policies of the Local Limited Partnerships.
Generally, Low-Income Housing Credits are available over a ten year period
from the date the Apartment Complex is placed in service; referred to herein as
the "Credit Period." Each of the Local Limited Partnerships in which the
Partnership has acquired an interest has been allocated by the relevant state
credit agency the authority to recognize Low-Income Housing Credits to be
claimed during the Credit Period provided that the Local Limited Partnership
satisfies the rent restriction, minimum set-aside and other requirements for
eligibility for the Low-Income Housing Credits at all times during the 15-year
period
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commencing at the beginning of the Credit Period (the "Compliance Period"). Once
a Local Limited Partnership has become eligible to receive Low-Income Housing
Credits, it may lose such eligibility and suffer an event of "recapture" if (i)
the Local Limited Partnership ceases to meet qualification requirements, (ii)
there is a decrease in the qualified basis of the projects, or (iii) there is a
reduction in the taxpayer's interest in the project at any time during the
15-year Compliance Period that began with the first tax year of the Credit
Period. According to the Form 10-K, none of the Local Limited Partnerships in
which the Partnership has acquired an interest has suffered an event of
recapture.
According to the Form 10-K, the Partnership generated Low-Income Housing
Credits per Unit of $150.99, $150.90 and $151.09, during the calendar years
1996, 1995 and 1994, respectively. Also according to the Form 10-K, the annual
Low-Income Housing Credits per Unit stabilized in 1993 at approximately $151.00
per Unit and are expected to remain stable through the year 2000 and then
decrease as certain properties reach the end of the ten year Credit Period.
Together the 27 Local Limited Partnerships own 27 Apartment Complexes.
According to the Form 10-K, the properties owned by the Local Limited
Partnerships are located in ten states and the Virgin Islands. Five of the
properties, totaling 612 units, are existing and underwent rehabilitation;
twenty-two properties, consisting of 1,762 units, are new construction. All
properties have completed construction or rehabilitation and initial lease-up.
Attached to this Offer to Purchase as Part II of Appendix A is a schedule of
these Local Limited Partnerships, including certain information concerning their
respective Apartment Complexes.
The Partnership is subject to the information reporting requirements of the
Exchange Act, and accordingly, is required to file reports and other information
with the Commission relating to its business, financial results and other
matters. 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 at
7 World Trade Center, New York, New York 10048 or electronically at
http://www.sec.gov. 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.
Outstanding Units. According to the Form 10-K, there were 68,929 Units
issued and outstanding, held by approximately 3,753 Unitholders, as of March 31,
1997.
Selected Financial and Property Related Data. Attached as Appendix A is a
summary of certain financial and statistical information with respect to the
Partnership and the Properties, all of which has been taken from the
Partnership's Form 10-K for the year ended March 31, 1997. More comprehensive
financial and other information is included in such reports and other documents
filed by the Partnership with the Commission, and Appendix A is qualified in its
entirety by reference to such reports and other documents and all the financial
information and related notes contained therein.
Prior Acquisitions of Units and Prior Contacts. On or about July 22,
Purchaser requested the General Partner to provide a list of Unitholders for the
purpose of making an offer to purchase Units and on or about August 6, Purchaser
informed the General Partner of its intent to make the Offer. As of the date of
this Offer the General Partner has not responded. Except as set forth above,
neither the Purchaser nor its affiliates are party to any past, present or
proposed material contracts, arrangements, understandings, relationships, or
negotiations with the Partnership or the General Partner.
DETERMINATION OF PURCHASE PRICE
In establishing the Purchase Price, the Purchaser reviewed certain publicly
available information including among other things: (i) the Partnership
Agreement; and (ii) the 1997 Form 10-K and (iii) the Prior Offer. Based on that
information, the Purchaser considered several factors, some of which are
discussed below.
Trading History of the Units. Secondary market sales activity for the
Units, including privately negotiated sales, has been limited and sporadic. The
1997 Form 10-K states that "[t]here is no public trading market for Units." At
present, privately negotiated sales and sales through intermediaries (such as
through the
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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 source, the
high and low sales price per Unit for the twelve-month period ending on or about
June 30, 1997 were $654 and $375, respectively. Sales may be conducted which are
not reported in the Partnership Spectrum and the prices of sales through other
channels may differ from those reported by the Partnership Spectrum. The
reported gross sales prices may not reflect the net sales proceeds received by
sellers of Units, which typically are reduced by commissions (approximately 5%
to 9%) and other secondary market transaction costs. The Purchaser does not know
whether the information provided by the Partnership Spectrum is accurate or
complete.
Remaining Tax Credits. Based on information contained in the Prior Offer,
the Purchaser believes that additional tax credits of approximately $645 will be
available to Unitholders who hold their units through December 31, 2003.
CERTAIN INFORMATION CONCERNING THE PURCHASER
The Purchaser. The Purchaser is comprised of two California limited
liability companies that were formed in 1997. The principal office of the
Purchaser is 199 South Los Robles Avenue, Suite 440, Pasadena, CA 91101. Everest
Tax Credit Investors, LLC is owned by Everest Properties II, LLC, a California
limited liability company ("EPII"), and by Imperial Bank, a California
state-chartered bank. Imperial Bank is the wholly owned operating subsidiary of
Imperial Bancorp, a bank holding company registered under the Bank Holding
Company Act of 1956. Everest Tax Credit Investors II, LLC, is owned by EPII and
East-West Bank, a California state-chartered bank. The Manager of the Purchaser
is EPII, and it is the person which manages Purchaser's affairs. For certain
information concerning the directors and executive officers of EPII, Imperial
Bank, Imperial Bancorp and East-West Bank, see Schedule I to the Offer to
Purchase.
General. Except as set forth above or elsewhere in this Offer to Purchase:
(i) the Purchaser does not beneficially own or have a right to acquire, and, to
the best knowledge of the Purchaser, no associate or majority-owned subsidiary
of any of the Purchaser or the persons listed in Schedule I hereto, beneficially
owns or has a right to acquire any Units or any other equity securities of the
Partnership; (ii) the Purchaser does not have, and, to the best knowledge of the
Purchaser, neither the persons and entities referred to in clause (i) above nor
any of their executive officers, directors or subsidiaries has, effected any
transaction in the Units or any other equity securities of the Partnership
during the past 60 days other than as stated in this Offer; (iii) the Purchaser
does not have, and, to the best knowledge of the Purchaser, none of the persons
listed in Schedule I hereto has, any contract, arrangement, understanding or
relationship with any other person with respect to any securities of the
Partnership, including, but not limited to, 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, consents or
authorizations; (iv) since December 31, 1993, there have been no transactions
which would require reporting under the rules and regulations of the Commission
between the Partnership or any of its affiliates and the Purchaser or any of its
subsidiaries or, to the best knowledge of the Purchaser, any of their executive
officers, directors or affiliates; and (v) since December 31, 1993, there have
been no contacts, negotiations or transactions between the Purchaser or any of
its subsidiaries or, to the best knowledge of the Purchaser, any of the persons
listed in Schedule I hereto, 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, or a sale or other
transfer of a material amount of assets of the Partnership.
Source of Funds. Based on the Purchase Price of $600.00 per Unit, the
Purchaser estimates that the total amount of funds necessary to purchase all
Units sought by this Offer and to pay related fees and expenses, will be
approximately $2,200,000. The Purchaser expects to obtain these funds by means
of equity capital contributions from its members at the time the Units tendered
pursuant to the Offer are accepted for payment. Such members will fund their
capital contributions through existing cash and other financial assets which in
the aggregate are sufficient to provide the funds required in connection with
the Offer without any additional borrowings.
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FUTURE PLANS OF THE PURCHASER
The Purchaser is seeking to acquire Units pursuant to the Offer to acquire
a substantial equity interest in the Partnership, primarily for investment.
Following the completion of the Offer, the Purchaser and persons related to or
affiliated with the Purchaser may acquire additional Units. Any such acquisition
may be made through private purchases, through one or more future tender or
exchange offers or by any other means deemed advisable by the Purchaser in its
sole discretion. 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, and may be for
cash or other consideration.
The Purchaser does not intend to change current management or the operation
of the Partnership and does not have plans for any extraordinary transaction
involving the Partnership. However, these plans could change at any time in the
future. If any transaction is effected by the Partnership and financial benefits
accrue to the Unitholders, the Purchaser and its affiliates will participate in
those benefits to the extent of their ownership of the Units.
The Purchaser has no present plans or proposals that would result in an
extraordinary transaction, such as a merger, reorganization, liquidation,
reallocation of operations or sale or transfer of assets involving the
Partnership or any material changes in the Partnership's structure, business or
composition of its management or personnel.
EFFECTS OF THE OFFER
Tendering Unitholders shall receive cash in exchange for their Units
purchased by the Purchaser and will forego all future distributions and tax
credit allocations from the Partnership with respect to such Units. Transfers of
50% or more of the Units in a twelve-month period may result in a termination of
the Partnership for federal income tax purposes and would also result in a
recapture of tax credits. Pursuant to the Partnership Agreement, the General
Partner is required to defer transfers in order to avoid such an event. The
Purchaser believes that its Offer (for approximately 5% of the Units) when
combined with the recent trading activity and information disclosed in the Prior
Offer will not likely result in a tax termination.
CERTAIN FEDERAL INCOME TAX MATTERS
The following summary is a general discussion of certain of the federal
income tax consequences of a sale of Units pursuant to the Offer. The summary is
based on the Internal Revenue Code of 1986, as amended (the "Code"), applicable
Treasury regulations thereunder, administrative rulings, and judicial authority,
all 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, nor does it describe any aspect of state, local, foreign or other
tax laws. Sales of Units pursuant to the Offer will be taxable transactions
under applicable state, local, foreign and other tax laws. UNITHOLDERS SHOULD
CONSULT THEIR RESPECTIVE TAX ADVISORS AS TO THE PARTICULAR TAX CONSEQUENCES TO
EACH SUCH UNITHOLDER OF SELLING UNITS PURSUANT TO THE OFFER.
In general, 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 of a Unitholder's adjusted tax basis in such Units
will vary depending upon the Unitholder's particular circumstances. The "amount
realized" with respect to a Unit will be a sum equal to the amount of cash
received by the Unitholder for the Unit pursuant to the Offer (that is, the
Purchase Price), plus the amount of the Partnership's liabilities allocable to
the Unit (as determined under Code Section 752).
The gain or loss recognized by a Unitholder on a sale of a Unit pursuant to
the Offer generally will be treated as a capital gain or loss if the Unit was
held by the Unitholder as a capital asset. Recent changes to the tax laws made
by the Taxpayer Relief Act of 1997 (the "Act") modified applicable capital gain
rates and
9
<PAGE> 12
holding periods. Gain with respect to Units held for more than 18 months will be
taxed at a long-term capital gain rate of 20 percent. Gain with respect to Units
held more than one year but less than 18 months will be taxed at mid-term
capital gain rate of 28 percent. Gain with respect to Units held one year or
less will be taxed at ordinary income rates. It should also be noted that the
Act imposed depreciation recapture of previously deducted straight line
depreciation with respect to real property at a rate of 25 percent (assuming
eligibility for long-term capital gain treatment). A portion of the gain
realized by a Unitholder with respect to a disposition of the Units may be
subjected to this 25 percent rate to the extent that the gain is attributable to
depreciation recapture inherent in the properties of the Partnership.
Capital losses are deductible only to the extent of capital gains, except
that individual taxpayers may deduct up to $3,000 per year 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 carry-forward period is five years and an individual taxpayer can
carry forward such losses indefinitely).
A tendering Unitholder will be allocated a pro rata share of the
Partnership's tax credits and taxable income or loss for the year of the sale
with respect to the Units sold in accordance with the provisions of the
Partnership Agreement concerning transfers of Units. Such allocation and any
cash distributed by the Partnership to the Unitholder for that year will affect
the Unitholder's adjusted tax basis in Units and, therefore, the amount of such
Unitholder's taxable gain or loss upon a sale of Units pursuant to the Offer.
Under Code Section 469, individuals and certain types of corporations
generally are able to deduct "passive activity losses" in any year only to the
extent of the person's passive activity income for that year. Substantially all
post-1986 losses of Unitholders from the Partnership are passive activity
losses. Unitholders may have "suspended" passive activity losses from the
Partnership (i.e., post-1986 net taxable losses in excess of statutorily
permitted "phase-in" amounts and which have not been used to offset income from
other passive activities).
If a Unitholder sells less than all of its Units pursuant to the Offer, a
loss recognized by that Unitholder can be currently deducted (subject to the
other applicable limitations) to the extent of the Unitholder's passive income
from the Partnership for that year plus any other passive activity income for
that year, and a gain recognized by a Unitholder upon the sale of Units can be
offset by the Unitholders' current or "suspended" passive activity losses (if
any) from the Partnership and other sources. If, on the other hand, a Unitholder
sells 100 percent of its Units pursuant to the Offer, any "suspended" losses and
any losses recognized upon the sale of the Units will be offset first against
any other net passive gain to the Unitholder from the sale of the Units and any
other net passive activity income from other passive activity investments, and
the balance of any "suspended" net losses from the Units will no longer be
subject to the passive activity loss limitation and, therefore, will be
deductible by such Unitholder from its other "ordinary" income (subject to any
other applicable limitations). If more than 3,500 Units are tendered, some
tendering Unitholders may not be able to sell 100 percent of their Units
pursuant to the Offer because of proration of the number of Units to be
purchased by the Purchaser.
Unitholders (other than tax-exempt persons, corporations and certain
foreign individuals) who tender Units may be subject to 31 percent backup
withholding unless those Unitholders provide a taxpayer identification number
("TIN") and are certain that the TIN is correct or properly certify that they
are awaiting a TIN. A Unitholder may avoid backup withholding by properly
completing and signing the Letter of Transmittal. If a Unitholder who is subject
to backup withholding does not include its TIN, the Purchaser will withhold 31
percent from payments to such Unitholder.
A Unitholder who tenders Units must file an information statement with his
federal income tax return for the year of the sale which provides the
information specified in Treasury Regulation Section 1.751-1(a)(3). The selling
Unitholder must also notify the Partnership of the date of the transfer and the
names, addresses and tax identification numbers of the transferrors and
transferee within 30 days of the date of the transfer (or, if earlier, January
15 of the following calendar year) (See IRS Form 8308).
10
<PAGE> 13
CERTAIN LEGAL MATTERS
General. Except as set forth in this Section, 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. 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.
State Takeover Statutes. The Partnership was formed under the laws of the
State of Massachusetts, which currently does not have any takeover statute
applicable to limited partnerships. However, it is a condition to the Offer that
no state or federal statute impose a material limitation on the Purchaser's
right to vote the Units purchased pursuant to the Offer. If this condition is
not met, Purchaser may terminate or amend the Offer.
If any person seeks to apply any state takeover statute, the Purchaser will
take such action as then appears desirable, which action may include challenging
the validity or applicability of any such statute in appropriate court
proceedings. If there is a claim that one or more takeover statutes apply to the
Offer, and it is not determined by an appropriate court that such statutes do
not apply or are invalid as applied to the Offer, the Purchaser might be
required to file certain information with, or receive approvals from, the
relevant state authorities. This could prevent the Purchaser from purchasing or
paying for Units tendered pursuant to the Offer, or cause delay in continuing or
consummating the Offer. In such case, the Purchaser may not be obligated to
accept for payment or pay for Units tendered.
Fees and Expenses. 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 will pay all costs and expenses of printing and mailing the
Offer and its legal fees and expenses. The Purchaser will reduce the purchase
price of Units by any transfer fees imposed by the Partnership.
Miscellaneous. The Offer is not made to (nor will tenders be accepted on
behalf of) Unitholders residing in any jurisdiction in which the making of the
Offer or the acceptance thereof would not be in compliance with the securities
or other laws of such jurisdiction. However, the Purchaser may, in its
discretion, take such action as it deems necessary to make the Offer in any
jurisdiction and extend the Offer to Unitholders in such jurisdiction.
In any jurisdiction where the securities or other laws require the Offer to
be made by a licensed broker or dealer, the Offer will be deemed to be made on
behalf of the Purchaser by one or more registered brokers or dealers that are
licensed under the laws of such jurisdiction.
The Purchaser has filed with the Commission a Tender Offer Statement on
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 under the caption "CERTAIN INFORMATION CONCERNING THE
PARTNERSHIP -- GENERAL" (except that they will not be available at the regional
offices of the Commission).
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.
EVEREST TAX CREDIT INVESTORS, LLC
EVEREST TAX CREDIT INVESTORS II, LLC
August 11, 1997
11
<PAGE> 14
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS
The business address of each executive officer and director of Everest
Properties II, LLC is 199 South Los Robles Avenue, Suite 440, Pasadena,
California 91101. Each executive officer and director is a United States
citizen. The name and principal occupation or employment of each executive
officer and director of Everest Properties II, LLC, are set forth below.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT
NAME POSITION AND FIVE-YEAR EMPLOYMENT HISTORY
- ------------------------- ---------------------------------------------------------------------
<S> <C>
W. Robert Kohorst........ President of Everest Properties II, LLC from 1996 - present.
President and Director of Everest Properties, Inc. from
1994 - present. President and Director of KH Financial, Inc. from
1991 - present.
David I. Lesser.......... Executive Vice President and Secretary of Everest Properties II, LLC
from 1996 - present. Executive Vice President of Everest Properties,
Inc. from 1995 - present. Principal and member of Feder, Goodman &
Schwartz, Inc. from 1992 - 1996.
</TABLE>
The business address of each executive officer and director of Imperial
Bank and Imperial Bancorp is 9920 South La Cienega Boulevard, Inglewood,
California 90301. Each executive officer and director is a United States
citizen. The name and principal occupation or employment of each executive
officer and director of Imperial Bank and Imperial Bancorp are set forth below.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT
NAME POSITION AND FIVE-YEAR EMPLOYMENT HISTORY
- ------------------------- ---------------------------------------------------------------------
<S> <C>
George L. Graziadio, Chairman of the Board, President and Chief Executive Officer of
Jr..................... Imperial Bancorp for the past five years. Chairman of the Board and
Co-Founder of Imperial Bank. Chairman of the Board of Imperial
Financial Group, Inc. Mr. Graziadio is also engaged as an owner or
partner in many other business activities primarily in the real
estate industry. Director of Coastcost Corp.
J. Richard Barkley....... Executive Vice President and Director, Human Resources for the past
five years.
William L. Capps......... Executive Vice President and Chief Administrative Officer of Imperial
Bank for the past five years.
Richard J. Casey......... Executive Vice President of Imperial Bank for the past five years.
Harry W. Chenoweth....... Executive Vice President of Imperial Bank commencing in 1997.
Previously served as a Senior Vice President with Union Bank for five
years.
Norman P. Creighton...... Vice Chairman and Chief Executive Officer and Director of Imperial
Bank for the past five years. Director of Imperial Bancorp.
Richard K. Eamer......... Director of Imperial Bank and Imperial Bancorp. Chairman Emeritus of
Tenet Healthcare Corporation.
Robert M. Franko......... President and Director of Imperial Finance Group, Inc. commencing in
1997. Executive Vice President and Chief Financial Officer of
Imperial Bank from 1995-1997. Previously served as President and
Chief Executive Officer of Springfield Bank and Trust Ltd.
G. Louis Graziadio, III.. Director of Imperial Bancorp. President of Ginarra Holdings, Inc.
Co-Chairman of the Board of Imperial Financial Group, Inc.
Richard LeBeau........... Director of Imperial Bancorp and Imperial Bank. Chairman of the Board
of Imperial Bank from 1982-1995.
Jack H. Leylegian II..... Director of Imperial Bank. President of Leylegian Investment
Management.
Eldon K. Lloyd........... Executive Vice President, Chief Credit Officer of Imperial Bank for
the past five years.
William L. MacDonald..... Director of Imperial Bank. President and Chief Executive Officer of
Compensation Resource Group.
Daniel R. Mathis......... President and Chief Operating Officer of Imperial Bank.
Christine McCarthy....... Executive Vice President and Chief Financial Officer of Imperial Bank
commencing in 1997. Executive Vice President and Chief Financial
Officer of First Interstate Bank for the five years prior to 1997.
</TABLE>
12
<PAGE> 15
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT
NAME POSITION AND FIVE-YEAR EMPLOYMENT HISTORY
- ------------------------- ---------------------------------------------------------------------
<S> <C>
Lee E. Mickles........... Director of Imperial Bank from 1994 to present. Investment Advisor,
Mikles/Miller Management, Inc. Director of Coastcost Corp.
Robert S. Muehlenbeck.... Executive Vice President of Imperial Bank since 1993. President of
Seaborg, Inc. for five years prior thereto.
Paul A. Novelly.......... Director of Imperial Bank. President of Apex Oil Co. Director of
Imperial Financial Group, Inc.
Charles T. Owen.......... Director of Imperial Bank. President and Publisher of the San Diego
Business Journal.
H. Wayne Snavely......... Director of Imperial Bank, Imperial Bancorp and Imperial Financial
Group, Inc. from 1994-present. Chairman and Chief Executive Officer
of Imperial Credit Industries, Inc. Director of Imperial Credit
Mortgage Holdings, Inc. Director of Southern Pacific Funding Corp.
Dr. M. Norvel Young...... Director of Imperial Bank and Imperial Bancorp from 1985-present.
Chancellor Emeritus, Pepperdine University.
</TABLE>
The business address of each executive officer and director of East-West
Bank is 415 Huntington Drive, San Marino, California 91108. Unless otherwise
specified, each executive officer and director is a United States citizen. The
name and principal occupation or employment of each executive officer and
director of East-West Bank are set forth below.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT
NAME POSITION AND FIVE-YEAR EMPLOYMENT HISTORY
- ------------------------- ---------------------------------------------------------------------
<S> <C>
Dominic Ng............... President and Chief Executive Officer and a Director of East-West
Bank from 1992 - present.
William H. Chu........... Senior Vice President Director of Planning and Business Development
(from June 1994 - present) and a Director of East-West Bank.
Director, President and Chief Executive Officer of United Pacific
Bank from 1992 - 1994.
Lon L. Dayhoff........... Senior Vice President Director of Retail Banking of East-West Bank
from 1990 - present.
Julia S. Gouw............ Senior Vice President Chief Financial Officer (from 1994 - present)
and a Director of East-West Bank. Senior Vice President and
Controller of East-West Bank from 1991 - 1994.
Douglas P. Krause........ Senior Vice President General Counsel and Secretary of East-West Bank
from 1996 - present. Sole Practitioner in 1996. Corporate Senior Vice
President and General Counsel of Metrobank from 1992 - 1996.
A. Kendall Raine, Jr..... Chairman of the Board of Directors of East-West Bank from
1992 - present.
Fock Siew Wah............ Vice Chairman of the Board of Directors of East-West Bank. Currently
a Chairman of the Board of Land Transport Authority and Nuri Holdings
(S) Pte. Ltd., and a Director of Singapore Technologies Pte. Ltd.,
Temasek Holdings (Pte.) Ltd., The Great Eastern Life Assurance Co.
Ltd., and Nuri Investments Pte. Ltd., and a Member of the Board of
Commissioners of PT PAMA Ventura Indonesia. Chairman of Singapore MRT
Ltd. from 1987 - 1995. Special Advisor to the Singapore Minister of
Finance from 1991 - 1995. Fock Siew Wah is a citizen of Singapore.
Jean-Pierre Chavy........ Director of East-West Bank. Managing Director of Seyen Investment,
Inc. from 1992 - present.
Cherie Nursalim.......... Director of East-West Bank. Assistant Manager for Gajah Tunggal Group
Seyen Investment from 1991 - present. Cherie Nursalim is a citizen of
Indonesia.
Christopher L. Pocino.... Director of East-West Bank. Self-employed investor for the past 5
years.
Philip Chow.............. Director of East-West Bank. Self-employed investor for the past 5
years.
</TABLE>
13
<PAGE> 16
APPENDIX A
Set forth below is a summary of certain financial data for the Partnership
which has been excerpted from the Form 10-K. More comprehensive financial and
other information is included in such report and other documents filed by the
Partnership with the Commission, and the following summary is qualified in its
entirety by reference to such report and other documents and all the financial
information and related notes contained therein.
PART I
SELECTED FINANCIAL DATA
STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED MARCH 31, 1997, 1996 AND 1995
<TABLE>
<CAPTION>
1997 1996 1995
----------- ----------- -----------
<S> <C> <C> <C>
Revenue:
Investment........................................ $ 191,349 $ 146,575 $ 109,711
Other............................................. 13,334 77,437 62,152
----------- ----------- -----------
Total Revenue............................. 204,683 224,012 171,863
Expenses:
General and administrative (includes
reimbursements to an affiliate in the amounts
of $117,763, $115,696 and $116,177)............ 237,545 225,369 275,733
Asset management fee, related party............... 231,035 224,953 219,149
Amortization...................................... 29,451 30,521 40,522
----------- ----------- -----------
Total Expenses............................ 498,031 480,843 535,404
Loss before equity in losses of Local Limited
Partnerships...................................... (293,340) (256,831) (363,541)
Equity in losses of Local Limited Partnerships...... (4,044,413) (4,695,617) (4,747,136)
----------- ----------- -----------
Net Loss............................................ $ 4,337,761 $(4,952,448) $(5,110,677)
=========== =========== ===========
Net Loss allocated:
General Partners.................................. (43,378) (49,524) (51,107)
Limited Partners.................................. (4,294,383) (4,902,924) (5,059,570)
----------- ----------- -----------
$(4,337,761) $(4,952,448) $(5,110,677)
=========== =========== ===========
Net Loss per Limited Partnership Unit (68,929
Units)............................................ $ (62.30) $ (71.13) $ (73.40)
=========== =========== ===========
</TABLE>
14
<PAGE> 17
<TABLE>
<CAPTION>
MARCH 31, MARCH 31, MARCH 31,
1997 1996 1995
------------ ------------ ------------
<S> <C> <C> <C>
Revenue.......................................... $ 204,683 $ 224,012 $ 171,863
Equity in losses of Local Limited Partnerships... (4,044,413) (4,695,617) (4,747,136)
Net loss......................................... (4,337,761) (4,952,448) (5,110,677)
Per Limited Partnership Unit (A)............... (62.30) (71.13) (73.40)
Cash, cash equivalents and marketable
securities..................................... 3,289,694 3,342,899 3,269,031
Investment in Local Limited Partnerships, at
original cost.................................. 56,559,793 56,559,793 56,346,293
Total assets (B)................................. 33,871,495 38,246,869 42,985,386
Cash Distributions............................... -- -- --
Other data:
Passive loss (C)................................. (5,154,301) (5,187,774) (5,204,384)
Per Limited Partnership Unit (A, C)............ (74.03) (74.51) (74.75)
Portfolio income (C)............................. 281,707 350,417 233,083
Per Limited Partnership Unit (A, C)............ 4.05 5.03 3.35
Low-Income Housing Tax Credit (C)................ 10,512,996 10,506,229 10,519,636
Per Limited Partnership Unit (A, C)............ 150.99 150.90 151.09
Local Limited Partnership interests owned at end
of period...................................... 27 27 27
</TABLE>
- ---------------
(A) Per Limited Partnership Unit data is based upon 68,929 outstanding Units.
(B) Total assets include the net investment in Local Limited Partnerships.
(C) Income tax information is as of December 31, the year end of the Partnership
for income tax purposes.
CASH DISTRIBUTIONS.
No cash distributions were made during the year ended March 31, 1997.
According to the Form 10-K, in prior years, cash available for distribution was
derived from the interest earned on the temporary investment of the
Partnership's funds, at money market rates, prior to the funds being contributed
to the Partnership's Local Limited Partnership investments. According to the
Form 10-K, based on the results of 1996 operations, the Local Limited
Partnerships are not expected to distribute significant amounts of cash to the
Partnership because such amounts will be needed to fund Property operating
costs. In addition, many of the Properties benefit from some type of federal or
state subsidy, and as a consequence, are subject to restrictions on cash
distributions. Therefore, it is expected that only a limited amount of cash will
be distributed to investors from this source in the future.
LIQUIDITY AND CAPITAL RESOURCES.
At March 31, 1997, of the Partnership had cash and cash equivalents of
$449,567 compared with $243,644 at March 31, 1996. According to the Form 10-K,
this increase is attributable to proceeds from sales and maturities of
marketable securities and cash distributions received from Local Limited
Partnerships, partially offset by net cash used for operations and purchases of
marketable securities.
According to the Form 10-K, as of March 31, 1997, approximately $2,735,000
of marketable securities has been designated as Reserves by the Managing General
Partner. The Reserves were established to be used for working capital of the
Partnership and contingencies related to the ownership of Local Limited
Partnership interests. According to the Form 10-K, management believes that the
interest income earned on Reserves, along with cash distributions received from
Local Limited Partnerships, to the extent available, will be sufficient to fund
the Partnership's ongoing operations. Reserves may be used to fund operating
deficits, if the Managing General Partner deems funding appropriate.
15
<PAGE> 18
According to the Form 10-K, since the Partnership invests as a limited
partner, the Partnership has no contractual duty to provide additional funds to
Local Limited Partnerships beyond its specified investment. Thus, as of March
31, 1997, the Partnership had no contractual or other obligation to any Local
Limited Partnership, which had not been paid or provided for.
The Form 10-K states that, in the event a Local Limited Partnership
encounters operating difficulties requiring additional funds, the Partnership
might deem it in its best interests to provide such funds, voluntarily, in order
to protect its investment. No such event has occurred to date.
RESULTS OF OPERATIONS.
1997 VERSUS 1996.
The Partnership's results of operations for the year ended March 31, 1997
resulted in a net loss of $4,337,761 as compared to a net loss of $4,952,448 for
the same period in 1996. According to the Form 10-K, the decrease in net loss is
primarily attributable to a decrease in equity in losses of Local Limited
Partnerships and an increase in investment revenue, offset by a decrease in
other revenue. The decrease in equity in losses of Local Limited Partnerships is
due to rental subsidy receipts in 1996 which were reserved in the prior year.
Investment revenue increased because of improved returns expired on investments
in securities during the fiscal year ended March 31, 1997.
1996 VERSUS 1995.
The Partnership's results of operations for the year ended March 31, 1996
resulted in a net loss of $4,952,448 as compared to a net loss of $5,110,677 for
the same period in 1995. This improved net loss position is primarily
attributable to lower general and administrative expenses and an increase in
investment and other revenue. General and administrative expenses decreased
primarily because of a decrease in investor reporting expenses. Investment and
other revenue increased because of improved returns earned on investments in
securities during fiscal year 1996.
16
<PAGE> 19
PART II
BOOK VALUE AND ACCUMULATED DEPRECIATION OF PROPERTY OWNED BY
LOCAL LIMITED PARTNERSHIPS IN WHICH THE PARTNERSHIP HAS INVESTED AT DECEMBER 31,
1996
<TABLE>
<CAPTION>
NUMBER TOTAL BUILDINGS/
OF ENCUM- IMPROVEMENTS ACCUMULATED DATE
DESCRIPTION UNITS BRANCES(1) LAND & EQUIPMENT DEPRECIATION(2) BUILT(2)
- ------------------------------------------- ------ ----------- ----------- ------------ --------------- --------
<S> <C> <C> <C> <C> <C> <C>
Strathern Park/Lorne Park.................. 241 $17,552,451 $ 5,889,320 $19,987,145 $ 4,438,048 1991
Los Angeles, CA
Maidens Choice............................. 101 4,050,000 807,791 5,405,085 1,193,185 1991
Baltimore, MD
Cedar Lane................................. 36 1,122,677 40,000 1,387,366 269,462 1991
London, KY
Silver Creek,.............................. 24 771,586 20,000 946,812 189,935 1990
Berea, KY
Rosecliff.................................. 168 5,617,392 1,120,000 7,963,747 1,856,102 1991
Orlando, FL
Brookwood.................................. 81 3,042,439 79,178 4,876,571 984,488 1992
Ypsilanti Township, MI
Water Oak.................................. 40 1,260,655 98,058 1,472,287 315,058 1991
Orange City, FL
Yester Oaks................................ 44 1,291,670 47,105 1,576,634 349,631 1991
Lafayette, GA
Ocean View................................. 42 1,371,628 112,620 1,607,768 366,864 1991
Ferandina Beach, FL
Wheeler House.............................. 17 713,772 42,000 1,164,939 225,657 1991
Nashua, NH
Archer Village............................. 24 711,860 40,000 900,157 209,079 1991
Archer, FL
Oaks of Dunlop............................. 144 4,453,719 631,959 6,601,884 1,711,138 1991
Colonial Heights, VA
Timothy House.............................. 112 2,572,215 11,638 6,740,910 883,228 1992
Towson, MD
Westover Station........................... 108 2,674,741 305,645 4,303,370 724,351 1991
Newport News, VA
Carib Villas III........................... 24 1,489,054 239,009 1,673,803 401,707 1992
St. Croix, VI
Carib Villas II............................ 20 1,407,642 197,195 1,650,817 386,389 1991
St. Croix, VI
Whispering Trace........................... 40 1,408,471 218,000 1,926,736 562,439 1990
Woodstock, GA
New Center................................. 104 3,519,360 96,116 6,448,536 1,164,004 1992
Detroit, MI
Huguenot Park.............................. 24 1,400,000 83,000 2,088,664 435,847 1991
New Paltz, NY
Hillwood Pointe............................ 100 2,993,869 454,185 5,105,170 1,121,626 1991
Jacksonville, FL
Pinewood Pointe............................ 136 4,053,614 555,093 7,255,716 1,569,667 1991
Jacksonville, Fl
Westgate................................... 60 1,389,836 236,689 2,153,469 421,740 1991
Bismark, ND
Woodlake Hills............................. 144 3,875,742 187,588 8,913,636 1,092,535 1992
Pontiac, MI
Bixel House................................ 76 1,442,282 190,746 2,344,940 656,472 1991
Los Angeles, CA
Harmony.................................... 65 3,124,470 0 7,138,522 1,596,510 1991
North Hollywood, CA
Schumaker Place............................ 96 2,941,443 536,153 5,226,820 581,838 1992
Salisbury, MD
Circle Terrace............................. 303 9,962,770 1,104,269 15,275,527 2,369,146 1993
Lansdowne, MD
----- ----------- ----------- ------------ -----------
TOTALS..................................... 2,374 $86,215,358 $13,343,357 $132,137,081 $26,076,146
===== =========== =========== ============ ===========
</TABLE>
- ---------------
(1) Mortgage notes payable generally represent non-recourse financing of
low-income housing projects with terms of up to 40 years at interest rates
ranging from 9.75% to 12%. The Partnership has not guaranteed any of these
mortgages notes payable.
(2) The Properties are being depreciated over various useful life periods.
17
<PAGE> 20
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 Purchaser at its address set forth below:
EVEREST PROPERTIES II, LLC
(MANAGER)
199 SOUTH LOS ROBLES AVENUE
SUITE 440
PASADENA, CALIFORNIA 91101
Questions and requests for assistance may be directed to the Purchaser at
its address and telephone number listed below. Additional copies of this Offer
to Purchase, the Letter of Transmittal, and other tender offer materials may be
obtained from the Purchaser as set forth below, and will be furnished promptly
at the Purchaser's expense. You may also contact your broker, dealer, commercial
bank, trust company or other nominee for assistance concerning the Offer.
For information regarding the Offer contact:
EVEREST PROPERTIES II, LLC
(Manager)
(800) 611-4613 or (626) 585-5920
199 South Los Robles Avenue
Suite 440
Pasadena, California 91101
<PAGE> 1
EXHIBIT 99.3
AGREEMENT OF TRANSFER AND LETTER OF TRANSMITTAL
FOR UNITS OF INTEREST
IN
BOSTON QUALIFIED HOUSING TAX CREDITS L.P. V,
A LIMITED PARTNERSHIP
FOR $600 PER UNIT
Subject to and effective upon acceptance for payment, the undersigned (the
"Seller") hereby sells, assigns, transfers, conveys and delivers and irrevocably
directs any custodian or trustee to sell, assign, transfer, convey and deliver
("Transfer") to Everest Tax Credit Investors, LLC, a California limited
liability company, and Everest Tax Credit Investors II, LLC, a California
limited liability company (collectively, the "Purchaser"), all of the Seller's
right, title and interest in units of interest (the "Units") in Boston Qualified
Housing Tax L.P. V, a Limited Partnership, a Massachusetts limited partnership
(the "Partnership"), for $600 per Unit, less the amount of Distributions (as
defined in the Offer to Purchase) per Unit, if any, made to Seller by the
Partnership after July 31, 1997 and before the date on which the Purchaser
purchases the Units tendered pursuant to the Offer (the "Purchase Date") and all
tax credits allocated to Seller after September 30, 1997, in accordance with and
pursuant to the Offer to Purchase, dated August 11, 1997, as it may be
supplemented or amended from time to time (the "Offer to Purchase") and this
Agreement of Transfer and Letter of Transmittal, as it may be supplemented or
amended from time to time (the "Letter of Transmittal," which together with the
Offer to Purchase, constitutes the "Offer").
Such Transfer shall include, without limitation, all rights in, and claims
to, any Partnership profits and losses, tax credit allocations, cash
distributions, voting rights and other benefits of any nature whatsoever
distributable or allocable to such Units under the Partnership's Amended and
Restated Agreement of Limited Partnership, as amended (the "Partnership
Agreement"), and all certificates evidencing the same, and Seller agrees
immediately to endorse and deliver to Purchaser all distribution checks received
from the Partnership after the Purchase Date. The Seller hereby irrevocably
constitutes and appoints the Purchaser as the true and lawful agent and
attorney-in-fact of the Seller 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), to vote, inspect Partnership books and records or act
in such manner as any such attorney-in-fact shall, in its sole discretion, deem
proper with respect to such Units, to deliver such Units and transfer ownership
of such Units on the Partnership's books maintained by the General Partner of
the Partnership, together with all accompanying evidences of transfer and
authenticity to, or upon the order of, the Purchaser, to immediately revoke and
withdraw all prior tenders of Units hereof, to direct any custodian or trustee
holding record title to the Units to do any of the foregoing, including the
execution and delivery of a copy of this Letter of Transmittal, and upon payment
by the Purchaser of the purchase price, to receive all benefits and cash
distributions, endorse Partnership checks payable to Seller and otherwise
exercise all rights of beneficial ownership of such Units. The Purchaser shall
not be required to post bond of any nature in connection with this power of
attorney.
The Seller hereby represents and warrants to the Purchaser that the Seller
owns such Units and has full power and authority to validly sell, assign,
transfer, convey and deliver such Units to the Purchaser, and that when any such
Units are accepted for payment by the Purchaser, the Purchaser will acquire
good, marketable and unencumbered title thereto, free and clear of all options,
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. If the undersigned is signing on behalf of
an entity, the undersigned declares that he has authority to sign this document
on behalf of the entity. The Seller further represents and warrants that the
Seller is a "United States person", as defined in Section 7701(a)(30) of the
Internal Revenue Code of 1986, as amended, or if the Seller is not a United
States person, that the Seller does not own beneficially or of record more than
5% of the outstanding Units.
The undersigned recognizes that under certain circumstances set forth in
the Offer to Purchase (including proration), the Purchaser may not be required
to accept for payment any or all of the Units tendered hereby. In such event,
the undersigned understands that this Letter of Transmittal will be effective to
Transfer only those Units accepted for purchase by the Purchaser and any Letter
of Transmittal for Units not accepted for payment may be destroyed by the
Depositary (in accordance with its customary practice).
<PAGE> 2
All authority herein conferred or agreed to be conferred shall survive the
death or incapacity or liquidation of the Seller and any obligations of the
Seller shall be binding upon the heirs, personal representatives, successors and
assigns of the undersigned.
Upon request, the Seller will execute and deliver, and irrevocably directs
any custodian to execute and deliver, any additional documents deemed by the
Purchaser to be necessary or desirable to complete the assignment, transfer and
purchase of such Units.
The Seller hereby certifies, under penalties of perjury, that (1) the
number shown below on this form as the Seller's Taxpayer Identification Number
is correct and (2) Seller is not subject to backup withholding either because
Seller has not been notified by the Internal Revenue Service (the "IRS") that
Seller is subject to backup withholding as a result of a failure to report all
interest or dividends, or the IRS has notified Seller that Seller is no longer
subject to backup withholding. The Seller hereby also certifies, under penalties
of perjury, that the Seller, if an individual, is not a nonresident alien for
purposes of U.S. income taxation, and if not an individual, is not a foreign
corporation, foreign partnership, foreign trust, or foreign estate (as those
terms are defined in the Internal Revenue Code and Income Tax Regulations). The
Seller 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.
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 the determinations will be final and binding. The Purchaser's
interpretation of the terms and conditions of the Offer (including this Letter
of Transmittal) will be final and binding. The Purchaser will have the right to
waive any defects or conditions as to the manner of tendering. Any defects in
connection with tenders, unless waived, must be cured within such time as the
Purchaser will determine. This Letter of Transmittal will not be valid until all
defects have been cured or waived.
Date: August 11, 1997
NOTICE OF WITHDRAWAL OF PRIOR TENDER
Execution and delivery of this Letter of Transmittal shall constitute
notice that the undersigned owner(s) irrevocably elects to withdraw all prior
tenders of any Units covered hereby made by such owner(s), including any tenders
made to Oldham Institutional Tax Credits LLC under its Offer dated July 24,
1997, as it may be amended.
ALL
[Specify Number of Units Tendered if less than "ALL"]
- ------------------------------------------------------
[Your Telephone Number]
- ------------------------------------------------------
[Your Social Security or Taxpayer ID Number]
- ------------------------------------------------------
- ------------------------------------------------------
[Your Address]
- ------------------------------------------------------
[Signature of Owner]
- ------------------------------------------------------
[Print Name]
- ------------------------------------------------------
[Signature of Co-Owner]
- ------------------------------------------------------
[Print Name]
- ---------------------------------------------------------
The completed Letter of Transmittal and original Partnership Certificate(s) (if
available) should be forwarded to:
EVEREST PROPERTIES II, LLC
199 S. Los Robles Ave., Suite 440
Pasadena, CA 91101
Attn: Securities Processing Department
(626) 585-5920
RE: BOSTON QUALIFIED HOUSING CREDITS L.P. V,
A LIMITED PARTNERSHIP
- ---------------------------------------------------------
2
<PAGE> 1
EXHIBIT 99.4
EVEREST TAX CREDIT INVESTORS, LLC
EVEREST TAX CREDIT INVESTORS II, LLC
199 SOUTH LOS ROBLES AVENUE
SUITE 440
PASADENA, CALIFORNIA 91101
AUGUST 11, 1997
$600 PER UNIT CASH OFFER
TO ALL UNITHOLDERS OF
BOSTON FINANCIAL QUALIFIED HOUSING TAX CREDITS L.P. V
DEAR UNITHOLDER:
Enclosed is an OFFER TO PURCHASE up to 3,500 Units of Boston Financial
Qualified Housing Tax Credits L.P. V, a Limited Partnership (the "Partnership")
for a cash price of $600 per Unit, without interest, less the amount of
Distributions (as defined in the Offer to Purchase) per Unit made by the
Partnership after July 31, 1997 and less any tax credits (allocable at the rate
of approximately $12.58 per month) which are allocated to selling Unitholders
after September 30, 1997, and less any Partnership transfer fees.
PLEASE CONSIDER THE FOLLOWING POINTS:
- THE OFFER EXCEEDS, BY $45 PER UNIT, THE OFFER MADE BY AN AFFILIATE OF THE
GENERAL PARTNER.
- Unitholders who tender to Everest will be withdrawing any tender they
have already made and will instead receive the higher price for all Units
accepted for payment by Everest. See the Offer to Purchase for a
discussion regarding certain risks associated with the withdrawal.
- Tendering Unitholders will forego future distributions and tax credit
allocations from the Partnership.
- Everest must receive an executed Letter of Transmittal not later than
August 20, 1997 to ensure the timely withdrawal of any prior tenders.
We encourage you to read the Offer to Purchase completely and to return
your completed Letter of Transmittal promptly. The Offer is scheduled to expire
on September 7, 1997.
For answers to any questions you might have regarding these materials or
our Offer, or assistance in the procedures for accepting our Offer and tendering
your Units, please contact us at (800) 611-4613 (toll free).
Sincerely,
Everest Tax Credit Investors, LLC
Everest Tax Credit Investors II, LLC
