SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
AMENDMENT NO. 3
TO
SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT
Pursuant to Section 14(d)(4) of the Securities Exchange Act of 1934
MARRIOTT HOTEL PROPERTIES II
LIMITED PARTNERSHIP
(Name of Subject Company)
MacKenzie Patterson Special Fund 2, L.P.
(Name of Person(s) Filing Statement)
Units of Limited Partnership Interest
(Title of Class of Securities)
None
(CUSIP Number of Class of Securities)
-----------------
C. E. Patterson Paul J. Derenthal, Esq.
MacKenzie Patterson, Inc. Derenthal & Dannhauser
1640 School Street, Suite 100 455 Market Street, Suite 1600
Moraga, California 94556 San Francisco, California 94105
(510) 631-9100 (415) 243-8070
(Name, Address and Telephone Number of Persons Authorized to Receive Notices and
Communications on Behalf of Persons Filing Statement)
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The Schedule 14D-9 of MacKenzie Patterson Special Fund 2, L.P.
concerning the tender offer by MHP II Acquisition Corp. for units of limited
partnership interest of Marriott Hotel Properties II Limited Partnership is
hereby amended to file as an additional exhibit the Exhibit 4 described below
and attached hereto:
Item 9. Material to be Filed as Exhibits
Exhibit No.
Exhibit 4 Notice to Unitholders dated May 28, 1996
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SIGNATURE
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.
Date: May 24, 1996 MACKENZIE PATTERSON SPECIAL FUND 2, L.P.
a California Limited Partnership
By: MACKENZIE PATTERSON, INC.,
General Partner
By: _/S/ VICTORIAANN TACHEIRA_
Victoriaann Tacheira,
Vice President
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EXHIBIT 4
Notice to Unitholders
of
MARRIOTT HOTEL PROPERTIES II LIMITED PARTNERSHIP
from
MacKENZIE PATTERSON, INC.
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Notice to Unitholders
of
MARRIOTT HOTEL PROPERTIES II LIMITED PARTNERSHIP
from
MacKENZIE PATTERSON, INC.
By letter dated May 15, 1996, the initial Expiration Date, MHP II
Acquisition Corp. (the "Purchaser"), notified you that it has extended its Offer
to purchase all the outstanding units of Marriott Hotel Properties II Limited
Partnership through June 13, 1996 and retains the right to extend the Offer
indefinitely thereafter. By letter dated May 23, 1996, the Purchaser amended its
offer to increase the Offer price to $150,000 per Unit. We believe that this
increased price demonstrates that Marriott believes that the original price of
$125,000 per Unit was less than the fair market liquidation value of the
Partnership's assets. We continue to believe that the General Partner has a duty
to advise the Limited Partners of its opinion concerning the value of the
Partnership's assets. With this notice we are providing a form by which the
Limited Partners can call for a meeting of the Limited Partners to seek the
General Partner's consent to adoption of a liquidation policy and democracy
rights in the best interests of the Partnership and all Limited Partners.
THE VALUATION
The General Partner and its parent, Host Marriott, still have not
provided their opinion of the value of the Partnership's assets. We believe that
the willingness of Host's subsidiary to pay a substantially increased purchase
price indicates that Host believes that the value of the Partnership's assets
substantially exceeds both the original Offer price and the maximum value per
Unit established by American Appraisal Associates, Inc. ("AAA"). The increased
price of $150,000 per Unit constitutes an amount which is 44% greater than the
base case value established by the AAA analysis and 16% greater than the maximum
value produced by that analysis. In other words, Host Marriott's subsidiary is
willing to pay $34 million more for the Units than the AAA analysis established
as the base value for the Units. We think this indicates material flaws in the
AAA analysis. We continue to believe that the General Partner owes the Limited
Partners the fiduciary duty to operate the Partnership in a manner designed to
provide a maximum return on the Limited Partners' investment, and, at a minimum,
the duty to provide its own opinion as to the adequacy of its affiliate's offer
price.
When the Partnership was formed, the Limited Partnership Agreement was
drafted by Marriott to provide specific procedures to protect the Limited
Partners' interests in the event of a sale of Partnership assets to the General
Partner or its affiliates. Under Section 5.02.B.(ii) of the Partnership
Agreement, the General Partner does not have the authority to sell any of the
Partnerships properties to its affiliates without the Limited Partners' consent,
and only after obtaining three separate appraisals of the fair market sales
values of the properties (not the Units) by independent appraisers. The purchase
price in such event would be payable in cash to the Partnership and would equal
the average of the three appraised values, disregarding any value which varied
by more than 20% from the mid-range appraisal. If the Manager were to purchase
the properties pursuant to its right of first refusal, the price would be the
greater of such average or the price offered by a third party. The entire cost
of such appraisal process would be borne by the General Partner and its
affiliates and no real estate commission would be chargeable by any party.
Host Marriott, by means of the tender offer by its subsidiary, is
seeking to acquire the economic benefits of complete control over the
Partnership's properties. The General Partner and its affiliates
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are seeking to do indirectly by means of the Offer what they are unable to do
directly in a purchase of the Partnership properties. We believe that, given the
admitted conflicts between the interests of the General Partner and the Limited
Partners, the General Partner should follow the procedures it designed to assure
fairness in transactions between the Partnership and the General Partner and on
which the Limited Partners relied in investing in Units.
MEETING OF LIMITED PARTNERS
With this Notice, we are circulating a form by which the Limited
Partners may request a meeting of the Limited Partners. The Partnership
Agreement provides, in Section 10.01.A., that "meetings of the Limited Partners
for any purpose...shall be called by the General Partner upon receipt of a
request in writing signed by holders of 10% or more of the Units held by Limited
Partners." The purpose of the meeting will be to discuss amendments to the
Limited Partnership Agreement which would (i) establish a more certain
liquidation policy and procedure for the Partnership, and (ii) provide more
standard Limited Partner democracy rights, and to petition the General Partner
to consent to, and solicit a Limited Partner consent, to such amendments.
We would submit a proposal at the meeting that the General Partner
adopt a specific liquidation strategy for the Partnership involving one or more
of the following: (i) a schedule for liquidation of the Partnership within the
next three years, subject to the General Partner's discretion to protect the
interests of the Limited Partners in the Partnership assets, (ii) the sale of
Partnership properties to affiliates of the General Partner in accordance with
the terms provided in the Partnership Agreement, as outlined above, or (iii)
providing a liquidity option for sale of Units to the General Partner or its
affiliates in a manner similar to the present tender offer, but with a purchase
price established as a net asset value for the Units based on the procedures for
purchase of Partnership assets by the General Partner or its affiliates. After
appropriate discussion, the General Partner will be asked to formulate such a
strategy within 30 days and submit it to the Limited Partners for approval by
subsequent written consent.
Currently, the Partnership Agreement does not provide the Limited
Partners specific rights to vote on and approve such basic matters as amendments
to the Partnership Agreement or liquidation of the Partnership without the
consent of the General Partner, except under limited circumstances involving
breach, wrongdoing or dereliction of duty by the General Partner. Although the
Partnership is now a "public company" by virtue of its recent registration under
the Securities Exchange Act of 1934, it was not publicly offered originally. If
it had been a public offering originally, it would have been required to comply
with standard investor protection provisions imposed by state securities
administrators, including the right to vote, without the General Partner's
consent, to amend the Partnership Agreement, remove the General Partner or
liquidate the Partnership, in each case without having to show "cause" in the
form of General Partner malfeasance or failure to perform. We would propose that
these investor protection provisions applicable to public partnerships should be
enacted by the General Partner and Limited Partners for the Partnership.
Please execute the attached "Request for Meeting" form and return it by
facsimile to MPI at 510-631-9119 or mail it to MPI at 1640 School Street, Suite
100, Moraga, California 94556.
Upon receipt of the requisite number of requests for a Limited Partners
meeting, we will submit the requests to the General Partner in order to set the
date for the meeting. If the Limited Partners' petitions are successful, the
General Partner would circulate proposed amendments to the Partnership Agreement
for approval by the Limited Partners.
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We continue to urge you to resist the Offer - the Limited Partners
resistance has already caused the Purchaser to increase its Offer by 20%, and we
believe that further resistance will cause the Purchaser and the General
Partners to establish an appropriate value for the Units. MPI continues to
believe the proposed transaction is neither in the best interests of those
partners who might tender nor those who choose not to tender, and recommends
against acceptance of the Offer.
WITHDRAWAL OF UNITS
Any Unitholder who has tendered Units to the Purchaser can withdraw
tendered Units at any time on or prior to the Expiration Date (currently June
13, 1996) by sending the Depositary, GEMISYS, Inc., written notice of withdrawal
(which may be by telegraphic or facsimile transmission as well as by mail)
stating the name of the tendering Unitholder, the number of Units to be
withdrawn, and the name of the registered Unitholder if different from the
tendering Unitholder. The attached Withdrawal of Tendered Units form may be used
for this purpose and the address and telephone numbers of the Depositary are
included on the form for your convenience. For further information on withdrawal
of tendered units, Marriott MHP Two Corporation Investor Relations can be
reached at (301) 380-2070.
May 28, 1996 MACKENZIE PATTERSON, INC
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REQUEST FOR MEETING
The undersigned is the holder of the number of Units of Limited
Partnership Interest in Marriott Hotel Properties II Limited Partnership (the
"Partnership") set forth beside my signature. Pursuant to Section 10.01.A. of
the Partnership's Amended and Restated Agreement of Limited Partnership, I
hereby request that the General Partner of the Partnership call a meeting of
Limited Partners upon receipt of this request signed by holders of at least 10%
of the outstanding Units. We request that this meeting be held as soon as
practicable in compliance with the provisions of Section 10.01.
The purpose of the meeting will be to discuss amendments to the Limited
Partnership Agreement which would
1. Adopt a specific liquidation strategy for the Partnership involving
one or more of the following: (a) a schedule for liquidation of the
Partnership within the next three years, subject to the General
Partner's discretion to protect the interests of the Limited Partners
in the Partnership assets, (b) the sale of Partnership properties to
affiliates of the General Partner in accordance with the terms
provided in the Partnership Agreement, as outlined above, or (c)
providing a liquidity option for sale of Units to the General Partner
or its affiliates in a manner similar to the present tender offer, but
with a purchase price established as a net asset value for the Units
based on the procedures for purchase of Partnership assets by the
General Partner or its affiliates; and
2. Provide Limited Partners holding a majority of the outstanding Units
the right to vote, without the General Partner's consent, to amend the
Partnership Agreement, remove the General Partner or liquidate the
Partnership, in each case without having to show "cause".
After appropriate discussion, the General Partner will be asked to
formulate a liquidation strategy and appropriate Limited Partner democracy
rights within 30 days and submit the proposed amendments to the Limited Partners
for approval by subsequent written consent.
All registered Unitholder(s) must sign exactly as name(s) appear(s) on the
address label.
- -------------------------------------------------
(Print Name(s))
- -------------------------------------------------
_________________________________________________ Dated: ____________________
(Signature(s))
_________________________________________________ Dated: ____________________
WHEN COMPLETED AND EXECUTED, SEND BY FAX TO 510-631-9119
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NOTICE OF WITHDRAWAL
OF
UNITS OF LIMITED PARTNERSHIP INTEREST
OF
MARRIOTT HOTEL PROPERTIES II LIMITED PARTNERSHIP
Previously Tendered Pursuant To The Offer By
MHP II ACQUISITION CORP.
THE WITHDRAWAL DEADLINE IS 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON JUNE 13, 1996, UNLESS EXTENDED
TO: GEMYSIS, INC.
Attention: Proxy Department
7103 South Revere Parkway
Englewood, Colorado 80112-9523
By Facsimile:
1-303-705-6171
Confirm facsimile by telephone:
1-800-955-9033
Gentlemen:
The following holder of Units of Limited Partnership Interest of
Marriott Hotel Properties II Limited Partnership (the "Units"), that have
previously been tendered pursuant to the offer by MHP II Acquisition Corp. are
hereby withdrawn. Please return the tendered Units and all rights with respect
thereto promptly to the undersigned. A failure to complete the Section "Number
of Units Tendered" shall be deemed to indicate the intent of the undersigned
that all Units previously tendered to MHP II Acquisition Corp. are hereby
withdrawn.
DESCRIPTION OF UNIT(S) WITHDRAWN AND SIGNATURES OF UNITHOLDERS
All registered Unitholder(s) must sign exactly as name(s) appear(s) on the
address label. See Instruction 3.
- -------------------------------------------------
(Print Name(s))
- -------------------------------------------------
Number of Units Tendered:
- -------------------------
_________________________________________________ Dated: ____________________
(Signature(s))
_________________________________________________ Dated: ____________________
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If signing as a trustee, executor, administrator, guardian,
attorney-in-fact, officer of a corporation or other person acting in a fiduciary
or representative capacity, please provide the following information and see
Instruction 3.
Name(s) and Capacity: _______________________________________________________
Address: ___________________________________________________________________
City, State: _____________________________________ Zip Code: _______________
Area Code and Tel. No.: _____________________________________________________
INSTRUCTIONS
1. Delivery of Notice of Withdrawal. The Notice of Withdrawal (attached as the
opposite page) should be completed, executed, detached and sent by facsimile
transmission (or mail) to GEMYSIS, Inc. at the facsimile number set forth on the
Notice of Withdrawal and must be received by GEMYSIS prior to 12:00 midnight,
New York City time, on June 13, 1996, or such date to which the Offer may be
extended. Receipt of the facsimile transmission of the Notice of Withdrawal by
GEMYSIS should be confirmed by telephone at the number set forth on the Notice
of Withdrawal.
2. Inadequate Space. If any space provided in the Notice of Withdrawal is
inadequate, all such additional information should be listed on a separate
schedule and attached as part of the Notice of Withdrawal.
3. Signature on Notice of Withdrawal. The Notice of Withdrawal must be signed by
the person(s) who signed the Letter of Transmittal related to the Offer, in the
same manner as such Letter of Transmittal was signed. The signatures must
correspond exactly with the name(s) as printed on the address label representing
such Units without alteration, enlargement or any change whatsoever. If any
Units tendered pursuant to the Offer are registered in the names of two or more
joint holders, all such holders must sign the Notice of Withdrawal. If the
Notice of Withdrawal is signed by any trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation, or others acting in a
fiduciary capacity, such persons should so indicate when signing and must submit
proper evidence satisfactory to GEMYSIS of their authority to act.
4. Guarantee of Signatures. No signature guarantee on this Notice of
Withdrawal is required if this Notice of Withdrawal is signed by the registered
Unitholder(s). In all other cases, all signatures on this Notice of Withdrawal
should be guaranteed by a member of a registered national securities exchange or
of the National Association of Securities Dealers, Inc. or by a commercial bank,
savings bank, or trust company having an office or correspondent in the United
States. See Instruction 3.
IMPORTANT: THIS NOTICE OF WITHDRAWAL MUST BE RECEIVED BY GEMYSIS PRIOR TO 12:00
MIDNIGHT, JUNE 13, 1996, OR SUCH DATE TO WHICH THE OFFER MAY BE EXTENDED.
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