SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 1
TO
SCHEDULE 14D-9
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SOLICITATION/RECOMMENDATION STATEMENT PURSUANT TO
SECTION 14(D)(4) OF THE SECURITIES EXCHANGE ACT OF 1934
SECURED INCOME L.P.
(Name of Subject Company)
SECURED INCOME L.P.
(Name of Person(s) Filing Statement)
UNITS OF LIMITED PARTNERSHIP INTEREST
(Title of Class of Securities)
813901105
(CUSIP Number of Class of Securities)
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GINA K. DODGE
WILDER RICHMAN RESOURCES CORPORATION
340 PEMBERWICK ROAD
GREENWICH, CT 06831
(203) 869-0900 (Name, Address and Telephone
Number of Person
Authorized to Receive Notice and Communications on Behalf of
the Person(s) Filing Statement)
Copies to:
Abbe L. Dienstag, Esq.
Kramer Levin Naftalis & Frankel LLP
919 Third Avenue
New York, NY 10022
(212) 715-9100
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This Amendment No. 1 to Schedule 14D-9 is filed by Secured
Income L.P., a Delaware limited partnership (the "Partnership"). This Amendment
No. 1 amends and restates the original Schedule 14D-9 filed by the Partnership
on December 15, 2005 in its entirety as follows:
ITEM 1. SUBJECT COMPANY INFORMATION.
The name of the subject company is Secured Income L.P., a Delaware
limited partnership (the "Partnership"). The address of the principal executive
offices of the Partnership is c/o Wilder Richman Resources Corporation, 340
Pemberwick Road, Greenwich, CT 06831. The telephone number of the principal
executive offices of the Partnership is (203) 869-0900. The general partners of
the Partnership (the "General Partners") are Wilder Richman Resources
Corporation, a Delaware corporation ("WRRC"), Real Estate Equity Partners, L.P.,
a Delaware limited partnership ("REEP"), and WRC-87A Corporation, a Delaware
corporation ("WRC-87A"). Each General Partner owns approximately one-third of
the outstanding general partners' interest in the Partnership.
The Partnership is invested in two local operating partnerships: (i)
the Columbia Westmont Associates, L.P. ("Columbia"), which owns The Westmont, a
residential apartment property located in New York, New York (the "Westmont
Property") and (ii) the Carrollton X Associates Limited Partnership, which owns
Fieldpointe Apartments, a residential apartment property located in Frederick,
Maryland (the "Fieldpointe Property" and collectively with the Westmont
Property, the "Properties").
The title of the class of equity securities to which this
Solicitation/Recommendation Statement on Schedule 14D-9 (this "Statement")
relates is the units of limited partnership interest of the Partnership
("Units"). As set forth in the Partnership's Annual Report on Form 10-K for the
year ended December 31, 2004 filed with the SEC on April 15, 2005, there were
984,369 Units issued and outstanding as of December 31, 2004.
ITEM 2. IDENTITY AND BACKGROUND OF FILING PERSON.
The Partnership is the filing person. The name, business address and
business telephone number of the Partnership are set forth in Item 1 above.
This Statement relates to the Tender Offer Statement on Schedule TO
(the "Schedule TO") initially filed with the SEC on November 30, 2005 and
amended on December 21, 2005 by MPF-NY 2005; LLC; Moraga Gold, LLC; MP Income
Fund 16, LLC; MPF Income Fund 22, LLC; MacKenzie Patterson Special Fund 7, LLC;
MP Income Fund 12, LLC; MPF Acquisition Co. 3, LLC; MPF DeWaay Fund 4, LLC; MPF
Flagship Fund 11, LLC; MPF Blue Ridge Fund I, LLC; MPF Blue Ridge II, LLC;
MacKenzie Patterson Special Fund 6, LLC; MacKenzie Patterson Special Fund 6-A,
LLC; MacKenzie Specified Income Fund; Accelerated High Yield Institutional Fund,
LTD., LP; Real Estate Securities Fund 83, LP (collectively, the "Purchasers").
This Statement is being filed in response to the offer by the Purchasers to
purchase up to 85,000 Units at an offer price of $38 per Unit in cash, less the
amount of any distributions declared or made with respect to the Units between
November 30, 2005 and January 20, 2006, upon the terms and conditions set forth
in the Offer to Purchase, dated November 30, 2005 (the "Offer to Purchase"), and
in the related Letter of Transmittal (collectively, the "Offer Documents"),
which, as amended and supplemented from time to time, together constitute the
tender offer (the "Offer"). The Offer will expire, unless further extended, on
January 20, 2006, at midnight, Pacific Standard Time.
According to the Schedule TO, the business address of the Purchasers
is 1640 School Street, Moraga, California 94556, and their telephone number is
(925) 631-9100 ext. 224.
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ITEM 3. PAST CONTRACTS, TRANSACTIONS, NEGOTIATIONS AND AGREEMENTS.
The Partnership is a limited partnership and has no executive
officers or directors. Mr. Richard Paul Richman beneficially owns 50% of the
equity interest in WRRC and is president and a director of WRRC. Mr. Robert H.
Wilder, Jr. beneficially owns the remaining 50% of the equity interest in WRRC
and is executive vice president and a director of WRRC. WRRC owns 50% of the
equity interest in WRC-87A and Real Estate Equity Partners Inc., the general
partner of REEP, owns the remaining 50% of the equity interests of WRC-87A. Mr.
Richman is executive vice president, secretary, treasurer and a director of
WRC-87A.
There are no material contracts, agreements, arrangements or
understandings or any actual or potential conflicts of interest between the
Partnership or its affiliates on the one hand and the Partnership, the General
Partners (including the officers and directors of the General Partners) or any
other affiliates of the Partnership on the other hand, except to the extent
noted in (i) the Partnership's Annual Report on Form 10-K (including the
Financial Statements and notes thereto filed therewith) for the year ended
December 31, 2004 filed with the SEC on April 15, 2005 and incorporated herein
by reference in its entirety as Exhibit (a)(5)(iii) to this Statement, (ii) the
Partnership's Quarterly Report on Form 10-Q (including the Financial Statements
and notes thereto filed therewith) for the period ended March 31, 2005 filed
with the SEC on May 16, 2005 and incorporated herein by reference in its
entirety as Exhibit (a)(5)(iv) to this Statement, (iii) the Partnership's
Quarterly Report on Form 10-Q (including the Financial Statements and notes
thereto filed therewith) for the period ended June 30, 2005 filed with the SEC
on August 15, 2005 and incorporated herein by reference in its entirety as
Exhibit (a)(5)(v) to this Statement and (iv) the Partnership's Quarterly Report
on Form 10-Q (including the Financial Statements and notes thereto filed
therewith) for the period ended September 30, 2005 filed with the SEC on
November 14, 2005 and incorporated herein by reference in its entirety as
Exhibit (a)(5)(vi) to this Statement.
West Putnam Housing Investors II LLC ("West Putnam II"), an
affiliate of both WRRC and Columbia, owns 186,217 Units, representing
approximately 18.9% of the outstanding Units. West Putnam Housing Investors LLC,
the managing member of West Putnam II and an affiliate of WRRC, owns 47,211
Units, representing approximately 4.8% of the outstanding Units. West Putnam
Housing Investors III LLC ("West Putnam III"), an affiliate of both WRRC and
Columbia, owns 16,607 Units, representing 1.7% of the outstanding Units. West
Putnam III's managing member is West Putnam II.
There are no material contracts, agreements, arrangements or
understandings or any actual or potential conflicts of interest between the
Partnership or its affiliates on the one hand and the Purchasers, their
executive officers, directors or affiliates on the other.
ITEM 4. THE SOLICITATION OR RECOMMENDATION.
For the reasons set forth below, the Partnership recommends against
tendering Units in the Offer, except for holders of Units who, because of their
individual circumstances, require immediate liquidity in their investment at
this time. The Partnership believes that Unit holders may realize greater value
through a sale of the of the two Properties which are indirectly owned by the
Partnership.
Reasons for Not Tendering Units in the Offer at this Time
A sale of the Properties may bring more value. The Partnership
continues to believe that it is appropriate at this time to attempt to sell the
Properties, which could lead to higher returns to Unit holders than the price
offered by the Purchasers. The sale of the Properties is currently being
negotiated. Once the sale of both Properties is completed, if at all, it is the
Partnership's intention, on a reasonably
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prompt schedule, to make a cash distribution to Unit holders of their share of
net sales proceeds and other assets of the Partnership, after which, the
Partnership would be liquidated. Unit holders should be aware that, while the
Partnership intends to use commercially reasonable efforts to effect the sale of
both Properties, there are factors that are not in the control of the
Partnership, and there can be no assurance that the Properties will be sold and
that the Partnership will be liquidated.
The highest written offer received thus far for the Westmont
Property is $87,750,000, slightly higher than the next highest competing offer.
A purchase and sale agreement is currently being negotiated. While it is
anticipated that an Agreement could be finalized and signed within the next
several weeks, there can be no assurance that this will occur within that time
frame, or at all. The sale would be subject to due diligence and other
conditions. The operating general partner anticipates that any sale of the
Westmont Property would be unlikely to occur before the second quarter of 2006.
The highest written offer received thus far for the Fieldpointe
Property is $26,500,000, slightly higher than the next highest competing offer.
The local general partner currently anticipates that other offers may be made,
and that a signed agreement of sale could be entered into within the next
several months. The sale would be subject to due diligence and other conditions,
and it is anticipated that a closing of the sale could occur within several
months of the signing of an agreement of sale. However, there can be no
assurance that a sale of the Fieldpointe Property will occur within that time
frame, or at all.
Assuming a sale price of $87,750,000 for the Westmont Property and
$26,500,000 for the Fieldpointe Property, the Partnership estimates a
liquidation value in the range of approximately $56.00 per Unit. This estimated
value has been calculated as follows:
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Sale price of the Properties $114,250,000
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Net cash and other assets of the 4,459,000
Partnership and the local partnerships
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Total $118,709,000
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Less:
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Mortgages and other payables (41,210,000)
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Transfer taxes and expenses of sale (3,474,000)
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Total payable to the local general, (18,454,000)
special limited partners and the
general partners of the Partnership,
in accordance with the governing
agreements
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Total available for distribution to the $55,571,000
holders of Units
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Number of Units 984,369
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Estimated distribution per Unit $56.45
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All amounts have been estimated as of December 2005 based on the Partnership's
interpretation of the relevant agreements. Actual amounts at the time of the
liquidation of the Partnership could vary substantially from the estimates.
If the purchasers of the Properties desired to assume the mortgages
currently existing on the Properties, the purchase price would be reduced by the
outstanding principal amount of the mortgages at the time of sale. Assumption of
the mortgages would require the approval of the respective lenders, which the
Partnership estimates could be obtained within 60 to 90 days. The local general
partners also have certain consent rights with respect to the sale of the
Properties, although the Partnership believes that these consents can be
obtained on a timely basis.
The Purchasers' offer price may be low. The Partnership believes
that Unit holders may realize greater value through a sale of the Properties.
The Purchasers acknowledge in the Offer to Purchase that they have not obtained
an independent appraisal for the Units or the Properties. The Purchasers
calculated their original offer price of $34 per Unit (which was later increased
to $38 per Unit) by applying a "liquidity discount" to the Partnership's
previously disclosed estimate that Unit holders could receive $43 per Unit if
the Properties are sold at or near the previously anticipated prices and the
Partnership is liquidated, but the Purchasers have not described the method used
to calculate the liquidity discount. As discussed above, the Partnership's
estimate of the potential liquidation value has been increased to the range of
$56 per Unit based on an increase in the offering prices for the Properties.
Accordingly, the Partnership recommends against tendering Units in the Offer,
unless a Unit holder requires immediate liquidity in their investment at this
time. The Partnership believes that Unit holders may realize substantially
greater value through a sale of the Properties, although there is no assurance
that the sale of the Properties will be completed or, if completed, that the
prices will be at or near the amounts currently offered.
Other considerations. The Partnership believes that the prospects
for the sale of the Properties are not reflected in the recent trading activity
of the Units or in the information published by independent secondary market
reporting publications such as The Direct Investment Spectrum and The American
Partnership Board. The Partnership cannot guarantee that the Properties can be
sold at or near the prices discussed above. Prices similar to the offer price
may not be available to Unit holders at a later time should a sale of the
Properties and liquidation of the Partnership not occur in the near future.
Unit holders may continue to receive distributions while a sale of
the Properties is negotiated. Unit holders have in recent years received
distributions from the Partnership equivalent to an 8% annual return. The amount
of future distributions will depend upon future operating results.
Based on these considerations, the Partnership continues to believe
that it is in the best interest of Unit holders generally to refrain from
tendering Units in the Offer at this time, and to support the pursuit by the
Partnership of a possible sale of the Properties and a liquidation of the
Partnership. In addition, affiliates of the Partnership and the General Partners
that own Units do not intend to tender their Units in the Offer.
If you have already tendered your Units in the Offer, you may wish
to revoke your tender in light of the potential sale of the Properties and the
liquidation of the Partnership, which may result in a higher payment to Unit
holders than the offer price in the Offer.
Considerations for those Unit Holders Wishing to Sell their Units at this Time
The Partnership recognizes that the individual financial
circumstances of each Unit holder may be different, and there may be Unit
holders who desire to liquidate their investment in the Partnership and receive
cash for their Units at this time. These holders should carefully review the
Offer
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Documents, including the risk factors, consult with their financial, tax
and other advisors and consider the following matters in deciding whether to
accept the Offer. In bringing these matters to the attention of the Unit
holders, the Partnership does not imply that they constitute considerations
against tendering in the Offer.
Future Distributions. A Unit holder that tenders Units in the Offer
will not receive any distributions from the Partnership for Units accepted for
purchase. If the Partnership were to make a distribution on or after the
Purchasers accepted Units in the Offer, the Purchasers would receive the
distributions with respect to all accepted Units. Although there can be no
assurance, the Partnership currently plans to continue to make quarterly cash
distributions at an annualized rate of 8% to the extent that cash from the
Properties and its reserves are available to do so.
Proration. The Purchasers are offering to acquire 85,000 Units. The
Offer allows Unit holders to sell "All or None" of their Units, thereby allowing
Unit holders the option to avoid proration if more than 85,000 Units are
tendered. In the event that more than 85,000 Units are tendered pursuant to the
Offer and the Unit holder does not select the "All or None" option, the
Purchasers will purchase a pro rata portion of the Units that are tendered. Unit
holders who do not tender all of their Units, or who tender all of their Units
but have only a portion that are accepted for payment, would remain limited
partners of the Partnership in respect of the Units or portion of a Unit that
they continue to hold.
The terms of the limited partnership agreement prohibit a transfer
of Units if the transfer would cause 50% or more of the Units to be transferred
within twelve months, taking account of all other transfers. The Partnership
does not believe that this restriction will be triggered by the Offer. The
Partnership notes that due to a restriction in the Partnership's limited
partnership agreement, tendered Units cannot be purchased to the extent that a
tendering Unit holder would remain with a number of Units that is greater than
zero but less than 250 Units (100 Units in the case of Units held in an IRA,
Keogh Plan or other qualified plan).
Tax consequences. All Unit holders are advised to consult with their
own tax advisers concerning the tax consequences of tendering Units in the
Offer. Unit holders should be aware that there could be different tax
consequences depending upon whether all or only some of their Units are
purchased in the Offer. If a holder sells only a portion of its Units, the
tendering Unit holder would only be able to utilize suspended losses in the year
of the sale to the extent of any gain on sale. If a Unit holder's entire
interest is sold, any suspended losses from the Partnership would be deductible
from ordinary income (subject to any other applicable limitation). There will be
other tax consequences to individual holders as a result of tendering Units in
the Offer or any other tender offer and those tax consequences could vary
significantly for each holder based on the holder's unique tax situation or
other circumstances.
Conditions of the Offer. The Offer is subject to a variety of
conditions, including market and other conditions that are unrelated to the
operations or prospects of the Partnership. These include, among others, the
absence of legal or government actions which would prohibit the purchase and the
absence of a material adverse change in the Partnership or its business. It is
also a condition of the Offer that there not be publicly disclosed that more
than 50% of the outstanding Units have been or are proposed to be acquired by
another person or any person or group that prior to such date had filed a
statement with the SEC that increases or proposes to increase the number of
Units beneficially owned by such person or group as disclosed in such statement
by two percent or more the outstanding Units. See Section 13 of the Offer to
Purchase for a discussion of these and other conditions of the Offer. According
to the Offer to Purchase, these conditions may be asserted or waived by the
Purchasers in their reasonable discretion. The Partnership cannot predict
whether or not any of these conditions may be exercised by the Purchasers.
Intentions of Affiliates of the Partnership
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Affiliates of Partnership own beneficially 250,035 Units, or
approximately 25.4% of the outstanding Units. These affiliates do not intend to
tender their Units pursuant to the Offer.
ITEM 5. PERSONS/ASSETS RETAINED, EMPLOYED, COMPENSATED, OR USED.
To the knowledge of Partnership, neither the Partnership nor any
person acting on its behalf has employed, retained or compensated, or intends to
employ, retain or compensate, any person or class of person to make
solicitations or recommendation to Unit holders on the Partnership's behalf
concerning the Offer.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
No transactions in the Units have been effected during the past 60
days by Partnership, or, to the knowledge of Partnership, by any of the
executive officers, directors or affiliates of the Partnership.
ITEM 7. PURPOSES OF THE TRANSACTION AND PLANS OR PROPOSALS.
The Partnership is not currently involved in any negotiation in
response to the Offer regarding a tender offer for or other acquisition of
securities by or of the Partnership. As stated above, the Partnership is
currently in negotiations pursuing a sale of the Properties. The Partnership
believes that under current market conditions, barring unforeseen issues, a sale
of the Properties could be accomplished in the next approximately four to six
months.
ITEM 8. ADDITIONAL INFORMATION.
Affiliates of WRRC have in the past purchased Units on an
unsolicited basis from Unit holders who on their own have contacted WRRC
concerning the sale of their Units, at prices requested by the holders.
Affiliates of WRRC may continue this practice, including during the pendency of
the Offer.
ITEM 9. EXHIBITS.
(a)(1)(i) Purchasers Offer to Purchase Units of the Partnership, dated
November 30, 2005 (filed as Exhibit (a)(1) to the Schedule
TO filed with the SEC by the Purchasers on November 30,
2005).
(a)(1)(ii) Letter of Transmittal and related instructions, dated
November 30, 2005 (filed as Exhibit (a)(2) to the Schedule
TO filed with the SEC by the Purchasers on November 30,
2005).
(a)(1)(iii) Letter to Unit holders of the Partnership, dated November
30, 2005 (filed as Exhibit (a)(3) to the Schedule TO filed
with the SEC by the Purchasers on November 30, 2005).
(a)(5)(i) Form of Notice of Withdrawal (filed with original Schedule
14D-9).
(a)(5)(ii) Letter to Unit holders, dated December 14, 2005 (filed with
original Schedule 14D-9).
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(a)(5)(iii) The Partnership's Annual Report on Form 10-K for the year
ended December 31, 2005 (filed with the SEC on April 15,
2005 and incorporated herein by reference).
(a)(5)(iv) The Partnership's Quarterly Report on Form 10-Q for the
period March 31, 2005 (filed with the SEC on March 16, 2005
and incorporated herein by reference).
(a)(5)(v) The Partnership's Quarterly Report on Form 10-Q for the
period ended June 30, 2005 (filed with the SEC on August 15,
2005 and incorporated herein by reference).
(a)(5)(vi) The Partnership's Quarterly Report on Form 10-Q for the
period ended September 30, 2005 (filed with the SEC on
November 14, 2005 and incorporated herein by reference).
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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: January 17, 2006
SECURED INCOME L.P.
By: Wilder Richman Resources
Corporation, its general partner
By: /s/ Richard Paul Richman
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Name: Richard Paul Richman
Title: President
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