SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule 13E-3
RULE 13e-3 TRANSACTION STATEMENT
Under Section 13(e) of the Securities Exchange Act of 1934
Prometheus Income Partners, a California limited partnership
(Name of Issuer)
Prometheus Income Partners
Prometheus Development Co., Inc.
PIP Partners-General, LLC
PromHill, Inc.
The DNS Trust
Helen P. Diller
Sanford N. Diller
(Name of Person(s) Filing Statement)
Limited Partnership Interests
(Title of Class of Securities)
742941107
(CUSIP Number of Class of Securities)
Craig S. Seligman, Esq.
Paul, Hastings, Janofsky & Walker LLP
555 So. Flower Street, Twenty-Third Floor
Los Angeles, California 90071
(213) 683-6000
(Name, Address and Telephone Number of Person Authorized to Receive Notices and
Communications on Behalf of Person(s) Filing Statement)
This Statement is filed in connection with (check the appropriate box):
a. [X] The filing of solicitation materials or an information statement subject
to Regulation 14A (Sections 240.14a-1 through 240.14b-2), Regulation 14C
(Sections 240.14c-1 through 240.14c-101) or Rule 13e-3(c) (Section 240.13e-3(c))
under the Securities Exchange Act of 1934 (the "Act").
b. [ ] The filing of a registration statement under the Securities Act of 1933.
c. [ ] A tender offer.
d. [ ] None of the above.
Check the following box if the soliciting materials or information
statement referred to in checking box (a) are preliminary copies: [ ]
Calculation of Filing Fee
Transaction Valuation Amount of filing fee
$1,736/Unit * 15,544 Units = $22,461,080 * 0.0002 +
$26,984,384 4,523,304 * 0.000092 =
$4,909
[X] Check box if any part of the fee is offset as provided by Section
240.0-11(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: $4,909
Form or Registration No: Schedule 14A
Filing Party: Prometheus Development Company
Date Filed: June 27, 2000 (as amended through May 24, 2002)
Introduction
This Rule 13E-3 Transaction Statement (the "Statement") relates
to the proposed merger of PIP Acquisition, LLC into Prometheus Income Partners,
a California limited partnership.
The general partner of the partnership is Prometheus Development
Co., Inc., all of the equity of which is held by The DNS Trust. Sanford N.
Diller and Helen P. Diller are co-trustees and co-beneficiaries of the DNS
Trust.
The holder of 100% of the member interests of PIP Acquisition is
PIP Partners - General, LLC, 99% of the member interests of which are held by
The DNS Trust, and 1% of the member interests of which are held by Jaclyn B.
Safier. PromHill, Inc. is the manager of PIP General. All of the equity of
PromHill is held by The DNS Trust. Sanford N. Diller is the sole director and
the President and Chief Financial Officer of PromHill. Vicki Mullins is a Vice
President and Assistant Secretary of PromHill, and John Murphy is a Vice
President and Assistant Secretary of PromHill.
The following Cross Reference Sheet is supplied pursuant to
General Instruction F to Schedule 13E-3 and shows the location in the Proxy
Solicitation Statement filed on June 20, 2002 by PIP General of the information
required to be included in response to the items of this Statement. The
information in the Proxy Solicitation Statement (including the Appendices
thereto) and the additional disclosure materials referred to in item 16(a) below
are hereby expressly incorporated by reference in answer to the items in this
Statement, and the Cross Reference Sheet set forth below shows the location in
the Proxy Solicitation Statement to the information required to be included in
response to the items of this Statement. In the event the Proxy Solicitation
Statement is amended, this Schedule 13E-3 will be amended to reflect such
amendment of the Proxy Solicitation Statement.
Cross Reference Sheet
Item of Schedule 13E-3 Location in Proxy Solicitation Statement
pursuant to Schedule 14A
Item 1. Summary Term Sheet
Questions and Answers About the Transaction
Item 2. Subject Company Information
(a) Summary - Parties to the Transaction -
Prometheus Income Partners
(b) Summary - The Meeting - Record Date; Voting
Power; The Meeting - Record Date; Voting
Power; Additional Information Concerning
Units
(c) Summary - Parties to the Transaction -
Prometheus Income Partners; Background -
Fairness of the Transaction - Negative
Factors Considered; Background -
Alternatives to the Transaction - Continued
Ownership of Prometheus Income Partners;
Additional Information Concerning Units
(d) Questions and Answers About the Transaction;
Summary - Parties to the Transaction -
Prometheus Income Partners; Background -
Reasons for the Merger; Background -
Fairness of the Transaction - Positive
Factors Considered; Background - Fairness of
the Transaction - Negative Factors
Considered; Background - Alternatives to the
Transaction - Liquidation; Background -
Alternatives to the Transaction - Continued
Ownership of the Partnership; The Parties -
Prometheus Income Partners - Construction
Defects; The Parties - Prometheus Income
Partners - Distributions; Additional
Information Concerning Units - Plans or
Proposals
(e) Inapplicable
(f) The Parties - Prometheus Income Partners -
Recent Transactions; Additional Information
Concerning Units
Item 3. Identity and Background of Filing Person
(a)-(c) Summary - Parties to the Transaction - PIP
Partners - General; Summary - Parties to the
Transaction - PIP Acquisition; The Parties -
Prometheus Income Partners - Background; The
Parties - PIP Partners - General; The
Parties - PIP Acquisition
Item 4. Terms of the
Transaction
(a)-(c) Questions and Answers About the Transaction;
Summary - Structure of the Transaction;
Summary - The Meeting - Quorum; Vote
Required; Summary - Conditions to the
Transaction; Summary - Consideration and
Financing; Summary - Accounting Treatment;
Summary - Federal Income Tax Consequences;
Background- Reasons for the Merger
(d) Questions & Answers About the Transaction
(e) Other Matters
(f) Inapplicable
Item 5. Past Contacts, Transactions, Negotiations and Agreements
(a) - (c) Background - Reasons for the Merger; The
Parties - Prometheus Income Partners -
Recent Tender Offers; The Parties -
Prometheus Income Partners - Recent
Transactions; Additional Information
Concerning Units; Additional Information
Concerning Units - Principal Holders of
Units; Additional Information Concerning
Units - Contracts, Arrangements and
Understandings
(e) Inapplicable
Item 6. Purposes of the Transaction and Plans or Proposals
(b) Inapplicable
(c) Summary - Consideration and Financing; The
Merger - Effects of the Merger on Prometheus
Income Partners; Additional Information
Concerning Units - Plans or Proposals
Item 7. Purposes, Alternatives, Reasons and Effects
(a), (c) Questions and Answers About the Transaction;
Background - Reasons for the Merger;
Background - Fairness of the Transaction -
Positive Factors Considered
(b) Background - Alternatives to the Transaction
Considered
(d) Summary - Structure of the Transaction;
Summary - Federal Income Tax Consequences;
Merger - Effects of the Merger on Prometheus
Income Partners; The Merger - Federal Income
Tax Consequences;
Item 8. Fairness of the Transaction
(a), (b) Questions and Answers About the Transaction;
Summary - Fairness of the Merger; Background
- Fairness of the Transaction
(c) Questions and Answers About the Transaction;
Summary - The Meeting - Quorum; Vote
Required; Background - Fairness of the
Transaction - Positive Factors Considered;
Background - Fairness of the Transaction -
Negative Factors Considered; The Meeting -
Vote Required
(d) Questions and Answers About the Transaction
(e), (f) Inapplicable
Item 9. Reports, Opinions, Appraisals and Negotiations
(a) Questions and Answers About the Transaction;
Background - Fairness of the Transaction;
The December 2000 Appraisal; The September
2001 Appraisal; Opinions of Financial
Advisor
(b) The December 2000 Appraisal; The September
2001 Appraisal; Opinions of Financial
Advisor; Appendix C-1; Appendix C-2;
Appendix D-1; Appendix D-2; Appendix E;
Appendix F
(c) Appendix C-1; Appendix C-2; Appendix D-1;
Appendix D-2; Appendix E; Appendix F
Item 10. Source and Amounts of Funds or Other Consideration
(a), (d) Summary - Consideration and Financing
(b) Questions and Answers About the Transaction;
Summary - Conditions to the Transaction;
Summary - Consideration and Financing
(c) Summary - Consideration and Financing; The
Merger Agreement - Expenses
Item 11. Interest in Securities of the Subject Company
(a) Questions and Answers About the Transaction;
Summary - Parties to the Transaction -
Prometheus Income Partners; Summary -
Parties to the Transaction - PIP Partners -
General; Summary - Parties to the
Transaction - PIP Acquisition; Summary -
Structure of the Transaction; The Parties -
Prometheus Income Partners - Principal
Unitholders; Additional Information
Concerning Units - Principal Holders of
Units
(b) The Parties - Prometheus Income Partners -
Recent Transactions; Background - Reasons
for the Merger; Additional Information
Concerning Units
Item 12. The Solicitation or Recommendation
(d) Questions and Answers About the Transaction;
Summary - The Meeting - Quorum; Vote
Required; Background - Fairness of the
Transaction - Positive Factors Considered;
Background - Fairness of the Transaction -
Negative Factors Considered; The Meeting -
Vote Required; The Meeting - Recommendations
of the General Partner
(e) Questions and Answers About the Transaction;
The Meeting - Recommendations of the General
Partner
Item 13. Financial Statements
(a) Summary Selected Financial Data of the
Partnership; Incorporation of Certain
Documents by Reference
(b) Inapplicable
Item 14. Persons/Assets, Retained, Employed, Compensated or Used
(a), (b) Summary - Proxy Solicitation; The Meeting -
Solicitation of Proxies
Item 15. Additional Information.
(b) Proxy Statement in Its Entirety
Item 16. Exhibits
(a) Letter to Limited Partners filed with the
Commission on June 29, 2000; Letter to
Limited Partners filed with the Commission
on November 27, 2000; Letter to Limited
Partners filed with the Commission on March
12, 2001; Letter to Limited Partners filed
with the Commission on October 18, 2001;
Letter to Limited Partners filed with the
Commission on March 15, 2002; Letter to
Limited Partners filed with the Commission
on May 16, 2002; Letter to Limited Partners
Transmitting Proxy Statement; Notice of
Meeting of Limited Partners; Proxy Statement
in Its Entirety; Appendices to the Proxy
Statement; Letter to Limited Partners filed
with the Commission on July 5, 2002;
(b) Not Applicable
(d) Appendix C-1; Appendix C-2; Appendix E
(f), (g) Not Applicable
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.
PROMETHEUS INCOME PARTNERS, a California
limited partnership
By: PROMETHEUS DEVELOPMENT CO.,
INC., a California corporation, its
General Partner
By: /s/ John J. Murphy
---------------------
Name: John J. Murphy
Title: Vice President
PROMETHEUS DEVELOPMENT CO., INC., a
California corporation
By: /s/ John J. Murphy
-----------------------
Name: John J. Murphy
Title: Vice President
PIP PARTNERS - GENERAL, LLC, a California
limited liability company
By: PROMHILL, INC., a California
corporation, Its Manager
By: /s/ John J. Murphy
--------------------
Name: John J. Murphy
Title: Vice President
PROMHILL, INC., a California corporation
By: /s/ John J. Murphy
----------------------
Name: John J. Murphy
Title: Vice President
SANFORD N. DILLER AND HELEN P. DILLER
AS TRUSTEES OF THE DNS TRUST
By: /s/ Helen P. Diller
---------------------
Name: Helen P. Diller
Title: Trustee
By: /s/ Sanford N. Diller
---------------------
Name: Sanford N. Diller
Title: Trustee
SANFORD N. DILLER
By: /s/ Sanford N. Diller
----------------------
Name: Sanford N. Diller
HELEN P. DILLER
By: /s/ Helen P. Diller
----------------------
Name: Helen P. Diller