October 12, 2004
By Facsimile (404) 572-6999 and U.S. Mail
Gregory M. Chait, Esq.
M. Todd Wade, Esq.
Powell Goldstein Frazer & Murphy LLP
191 Peachtree Street, NE
Sixteenth Floor
Atlanta, Georgia 30303
RE: United Investors Income Properties
Schedule 13E-3 filed September 28, 2004, as amended
File No. 005-56351
Schedule 14A Filed September 28, 2004
File No. 000-17646
Dear Messrs. Chait and Wade:
We note that consistent with the conversation between M.
Todd Wade and Celeste M. Murphy on Friday, September 24, 2004 regarding
the Schedule 13E-3 and Schedule 14C filings of your client, U.S.
Realty Partners and the prospective filings of United Investors
Income Properties, the Schedule 13E-3 and Schedule 14A filed on
behalf of United Investors Income Properties, referenced above,
are substantially similar in content and form. For these reasons, in
addition to the comments provided below, we refer you generally to
the U.S. Realty Partners comments issued to you on October 1, 2004
to apply as our comments to these filings made by United Investors
Income Properties. Please respond to the U.S. Realty Partners
October 1, 2004 comment letter, with the exception of comments 1,
3, 5, 6, 8, 13, 14, 20, 25, 30, 32, 43, and 50.
Where indicated, we think you should revise your documents
in response to these comments. If you disagree, we will consider
your explanation as to why our comment is inapplicable or a revision is
unnecessary. Please be as detailed as necessary in your
explanation. In some of our comments, we may ask you to provide us with
supplemental information so we may better understand your
disclosure. After reviewing this information, we may or may not raise
additional comments.
Please understand that the purpose of our review process is
to assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects. We welcome
any questions you may have about our comments or on any other
aspect of our review. Feel free to call us at the telephone number
listed at the end of this letter.
Schedule 13E-3
1. Please advise us why you believe that AIMCO, AIMCO Properties,
L.P., AIMCO-GP, Inc., AIMCO Operating Partnership, and Bronson
Place Associates, should not be added as filing persons on the Schedule
13E-3, as these affiliates appear to be engaged in the going
Private transaction. Otherwise, these entities should be individually
included as filing persons on the Schedule 13E-3. For help in
making this determination, please refer to Rules 13e-3(a)(1) and (3) of
the Exchange Act, as well as Section II.D.3 of the Division`s November
2000 Current Issues Outline available on our website.
2. It appears that AIMCO, AIMCO Properties, L.P., and AIMCO-GP,
Inc. should have promptly filed an amendment to their jointly filed
Schedule 13D when the parties determined to engage in the affiliate sale,
and possibly as early as when the general partner formed the intent to
enter into a transaction that would take the partnership private.
See Rule 13d-2(a). Nevertheless, our records indicate
that the parties filed such amendment on October 5, 2004 and before
such date had not filed an amendment to the Schedule 13D since May of
2003 to reflect the results of a prior tender offer. Please advise us
Why the parties failed to amend the Schedule 13D in connection with
the going private transaction before the date of October 5, 2004.
Schedule 14A
General
3. On a supplemental basis, please provide us with your analysis
for why AIMCO`s tender offers of May 2003 and August 2002 and the
other purchases of units during the past two years, including, but not
limited to the purchases described in the second quarter of 2002,
and the first and fourth quarters of 2003, did not constitute the
first steps in the going private transaction. Refer to Rule 13e-3(a)(3)
and Question and Answer No. 4 of Exchange Act Release No. 34-17719
(April 13, 1981). In your response to us, please address your
June 6, 2004 correspondence to us regarding our comment letter dated
May 23, 2003 alerting you to the fact, in comment 1, that the May 2003
tender offer may be viewed as the first step in a subsequent going
private transaction.
Letter to Limited Partner
4. Expand your tax liabilities disclosure regarding both the
general and limited partnership interests here and throughout your
document, including, but not limited to the bullet points found later in
this letter and the relevant risk factors, to quantify the resulting
tax liabilities and any insufficiency resulting from the cash
distribution. We note your tax discussion on page 16, but believe
that this section requires further disclosure as well. In
addition, revise all references to the distributions payable to limited
partners, including the first page of the letter to limited
partners, to disclose with equal prominence that the tax liability will or
is likely to (as opposed to "may" or "could") exceed the cash
received, if true. If the tax liability is unlikely to exceed the cash
received, you should state so. Quantify the net distribution
wherever possible to provide the most balanced disclosure of the
result to limited partners and the general partner.
Special Factors
5. We note, on page 8, that after the proposed sale and the future
sale of partnership`s remaining property are consummated, the
partnership will dissolve pursuant to the terms of the partnership
agreement and plans to file a notice with the SEC that will result
in the termination of the partnership`s public filing obligations.
We further note, on page 17, that the general partner anticipates
that the operating cash flow from the remaining properties will be
sufficient to pay operating expense and loan payments, but there
can be no assurance that the remaining properties will be operated
profitably, the partnership will make any future distributions to
limited partners, etc. Amend your filing to identify the
properties and provide their value. Disclose the intended management and
sales of the remaining properties, and the attendant costs and time
frame. Further, describe how you will make future distributions from the
sales of these properties. This disclosure is increasingly
important in light of your proposed amendment to the partnership agreement
to allow for future sales of the partnership`s property to the
general partner or affiliate without limited partner consent. We believe
that you should elaborate on the reason for this proposal at this
time, given the existence of the remaining properties, stating
whether or not the general partner or any of its affiliates intend
to purchase such property.
Risks
6. Elaborate on the mitigation of the general partner`s liability
for partnership liabilities resulting from the sale of the property,
as described on page 16. You should itemize all recourse debts and
other liabilities of the partnership to be reduced, including the
amounts by which they are reduced, by the sale of the property.
Legal Proceedings
7. We note that you reference the SEC investigation relating to
AIMCO in your U.S. Realty Partners filing, but not here. Please tell us
why you believe that such investigation is not relevant to this
filing. Assuming that you add disclosure of such investigation
you should provide details, including, but not limited to the date, to
your knowledge, of the commencement of the investigation and the
exact AIMCO entity or entities involved in such investigation.
As appropriate, please revise the Schedule 14A and Schedule
13E-3 in response to these comments. You may wish to provide us
with marked copies of the amendments to expedite our review. You
should include a letter responding to each comment, noting the location
of the change in the revised material. Please file your cover letter
on EDGAR. If you believe a comment raised in this letter is
inappropriate or feel that no change is required, indicate your
position and the basis for that position in your response letter.
In the absence of such response, we assume you will comply with staff
comments. We may have additional comments based upon our receipt
of the revised materials and your response to our comments.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to
be certain that they have provided all information investors require.
Since the company and its management are in possession of all
facts relating to a company`s disclosure, they are responsible for the
accuracy and adequacy of the disclosures they have made.
In connection with responding to our comments, please
provide, in writing, a statement from the company acknowledging that
* the company is responsible for the adequacy and accuracy of the
disclosure in the filings;
* staff comments or changes to disclosure in response to staff
comments in the filings reviewed by the staff do not foreclose the
Commission from taking any action with respect to the filing; and
* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.
In addition, please be advised that the Division of
Enforcement has access to all information you provide to the staff
of the Division of Corporation Finance in our review of your filing
or in response to our comments on your filing.
Direct questions to me at (202) 942-2903.
Very truly yours,
Celeste M. Murphy
Attorney-Advisor
Office of Mergers and
Acquisitions