-------------------------------------------------------------------------------- -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------- SCHEDULE 14D-9 SOLICITATION/RECOMMENDATION STATEMENT PURSUANT TO SECTION 14(D)(4) OF THE SECURITIES EXCHANGE ACT OF 1934 ---------------- AMERICAN INCOME 7 LIMITED PARTNERSHIP (NAME OF SUBJECT COMPANY) AMERICAN INCOME 7 LIMITED PARTNERSHIP (NAME OF PERSON FILING STATEMENT) UNITS OF LIMITED PARTNERSHIP INTEREST (TITLE OF CLASS OF SECURITIES) NONE (CUSIP NUMBER OF CLASS OF SECURITIES) ---------------- GEOFFREY A. MACDONALD AFG LEASING ASSOCIATES II 98 NORTH WASHINGTON STREET BOSTON, MASSACHUSETTS 02114 (617) 854-5800 (NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO RECEIVE NOTICES AND COMMUNICATIONS ON BEHALF OF THE PERSON(S) FILING STATEMENT) -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- D ITEM 1. SECURITY AND SUBJECT COMPANY. The name of the subject company is American Income 7 Limited Partnership, a Massachusetts limited partnership (the "Partnership"), which has its principal executive offices at 98 North Washington Street, Boston, Massachusetts 02114. The title of the class of equity securities to which this Statement relates is units (the "Units") of limited partnership interest of the Partnership. ITEM 2. TENDER OFFER OF THE BIDDER. This Statement relates to the tender offer of Atlantic Acquisition Limited Partnership, a Massachusetts limited partnership (the "Purchaser"), to purchase up to 32,133 of the outstanding Units at a purchase price of $17.56 per Unit, net to the seller in cash, without interest, pursuant to the terms and conditions of an Offer to Purchase dated August 18, 1995, and the related Letter of Transmittal (together, the "Offer"). The Offer is being made pursuant to a tender offer statement on Schedule 14D-1 dated August 18, 1995. The address of the principal executive offices of the Purchaser is 98 North Washington Street, Boston, Massachusetts 02114. ITEM 3. IDENTITY AND BACKGROUND. (a) The name and business address of the Partnership, which is the person filing this Statement, are set forth in Item 1 above. (b) The Purchaser is related to AFG Leasing Associates II, the general partner of the Partnership (the "General Partner"), to American Finance Group ("AFG"), the sponsor of the Partnership, and to parties related to AFG. Certain Relationships. The General Partner owns a 1% interest (with certain exceptions not expected to apply) in the Partnership of distributable cash from operations and from sales or refinancings. Further, subject to certain limitations contained in the Partnership Agreement of the Partnership, the Partnership will reimburse the General Partner and its affiliates for certain expenses incurred by them in connection with Partnership operations and will pay certain fees pursuant to the terms of the Partnership Agreement. For information as to the amounts paid to the General Partner and its affiliates during the last three fiscal years and the six months ended June 30, 1995, see Note 4 to the Financial Statements of the Partnership in the Form 10-K of the Partnership for the fiscal year ended December 31, 1994, and Note 5 to the Financial Statements of the Partnership in the Form 10-Q of the Partnership for the six months ended June 30, 1995. The general partner of the Purchaser is AAL, Inc., a newly-formed Massachusetts corporation ("AAL, Inc."). The directors, officers and stockholders of AAL, Inc. are Gary D. Engle and James A. Coyne. Mr. Engle controls AFG and the Purchaser. Messrs. Engle and Coyne and Geoffrey A. MacDonald are the initial limited partners of the Purchaser. AFG controls, and Mr. MacDonald has an interest in, the General Partner. Tender Offer Loan. As disclosed in the Offer, the Purchaser will obtain a loan in connection with the consummation of the Offer. The Purchaser plans to service the loan with cash distributions attributable to the Units it acquires. A primary possible source of such cash distributions is the Purchaser's distributable portion of the proceeds of any sale or refinancing of the Partnership's equipment. Consequently, the General Partner may have a conflict of interest in determining whether and when to sell and/or refinance the Partnership's equipment. ITEM 4. THE SOLICITATION OR RECOMMENDATION. Because of the inherent conflict of interest resulting from the relationships among the General Partner, the Purchaser and AFG, the Partnership is making no recommendation and is remaining neutral as to whether Unitholders should tender their Units pursuant to the Offer. 2 ITEM 5. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED. Neither the Partnership nor any person acting on its behalf has or currently intends to employ, retain or compensate any person or class of persons to make solicitations or recommendations to Unitholders on its behalf concerning the Offer. ITEM 6. RECENT TRANSACTIONS AND INTENT WITH RESPECT TO SECURITIES. (a) None. (b) AFG beneficially owns 1,790 Units; all of such Units will be tendered in the Offer. Except as set forth in the preceding sentence, neither the Partnership nor the General Partner, or any executive officer, director, affiliate or subsidiary of the Partnership or the General Partner, owns any Units. ITEM 7. CERTAIN NEGOTIATIONS AND TRANSACTIONS BY THE SUBJECT COMPANY. None. ITEM 8. ADDITIONAL INFORMATION TO BE FURNISHED. None. ITEM 9. MATERIAL TO BE FILED AS EXHIBITS. Exhibit (a)(i) --Cover Letter to Unitholders from the Partnership dated August 18, 1995. Exhibit (b) --None. Exhibit (c)(i) --Note 4 to the Financial Statements of the Partnership included in the Form 10-K of the Partnership for the fiscal year ended December 31, 1994. Exhibit (c)(ii)--Note 5 to the Financial Statements of the Partnership included in the Form 10-Q of the Partnership for the six months ended June 30, 1995. 3 SIGNATURES After reasonable 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 18, 1995 AMERICAN INCOME 7 LIMITED PARTNERSHIP By: AFG Leasing Associates II, its general partner By: AFG Leasing Incorporated, its general partner By: /s/ Geoffrey A. MacDonald --------------------------------- Name: Geoffrey A. MacDonald Title: President 4 EXHIBIT INDEX EXHIBIT SEQUENTIALLY NO. DESCRIPTION NUMBERED PAGE ------- ----------- ------------- Exhibit (a)(i) Cover Letter to Unitholders from the Partnership dated August 18, 1995. Exhibit (b) None. Exhibit (c)(i) Note 4 to the Financial Statements of the Partnership included in the Form 10-K of the Partnership for the fiscal year ended December 31, 1994. Exhibit (c)(ii) Note 5 to the Financial Statements of the Partnership included in the Form 10-Q of the Partnership for the six months ended June 30, 1995.