SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule TO/A
Tender Offer Statement Pursuant to Section 14(d)(1)
of the Securities Exchange Act of 1934
AMENDMENT NO. 1
(Name of Subject Company)
Historic Preservation Properties 1989 Limited Partnership
A Delaware limited partnership
at $100 Net Per Unit
by
Equity Resource Arlington Fund Limited Partnership,
a Massachusetts limited partnership
Equity Resources Group, Inc.
Eggert Dagbjartsson
Limited Partnership Units
Eggert Dagbjartsson, Executive Vice President
Equity Resources Group, Inc.
44 Brattle Street
Cambridge, MA 02138
(617) 876-4800
Calculation of Filing Fee
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Transaction Valuation* Amount of Filing Fee
$398,800 $79.76
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* For purposes of calculating the filing fee only. This calculation assumes
the purchase of 3,988 Units at a purchase price of $100 per Unit in the
Partnership.
[x] Check box if any part of the fee is offset as provided by Rule 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.
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Amount Previously Paid: $79.76 Filing Equity Resource
Party: Arlington Fund LP
Form of Registration No.: Schedule TO/T Date Filed: November 29, 2002
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AMENDMENT NO. 1
This Amendment No. 1 amends and supplements the Tender Offer Statement on
Schedule TO (the "Schedule TO") by Equity Resource Arlington Fund, Limited
Partnership, a Massachusetts limited partnership, Eggert Dagbjartsson, its
general partner and Equity Resources Group, Inc., its manager (collectively the
"Purchaser") to purchase 3,988 units (the "Units") of limited partnership
interests in Historic Preservation Properties 1989 Limited Partnership, a
Delaware limited partnership (the "Partnership"), at $100 for each Unit, net to
the seller in cash, without interest, less the amount of any distributions
declared or paid from any source by the Partnership with respect to the Units
after November 29, 2002 (without regard to the record date), upon the terms and
subject to the conditions set forth in the Offer to Purchase (the "Offer to
Purchase") and in the related Agreement of Sale, copies of which are attached
hereto as Exhibits (a)(l) and (a)(3) (which are herein collectively referred to
as the "Offer"). The information in the Offer to Purchase, including all
schedules and annexes thereto, is hereby expressly incorporated herein by
reference in response to all the items of this Statement, except as otherwise
set forth below.
Item 3-Identity and Background of Filing Person
Schedule 1 of The Offer is amended to include the following:
"Mark Thompson, President and Principal, Equity Resources Group, Inc.
Mr. Thompson joined Equity Resources Group, Inc. (ERG) in 1983,
specializing in the valuation and financial analysis of real estate
investments. Mr. Thompson has been ERG's president since 1995. Mr. Thompson
is a Co-General Partner of the following Equity Resource Funds:
Equity Resource Fund VI
Equity Resource Fund VIII
Equity Resource Fund X
Equity Resource Fund XII
Equity Resource Fund XV
Equity Resource Fund XVI
Equity Resource Fund XVIII
Equity Resource General Fund
Equity Resource Cambridge Fund
Equity Resource Brattle Fund
Equity Resource Bay Fund
Equity Resource Pilgrim Fund
Equity Resource Bridge Fund
Equity Resource Boston Fund
Equity Resource Lexington Fund
During the past five years, Mr. Thompson has not been convicted in a
criminal proceeding or been a party to any procedural or administrative
proceeding that resulted in a judgment, decree or final order enjoining Mr.
Thompson from future violations of, or prohibiting activities subject to,
federal or state securities law, or a finding of any violation of federal
or state securities law."
Item 4-Terms of the Transaction
The third paragraph of The Offer-Introduction is amended in its entirety to read
as follows:
"For those Limited Partners who accept the Offer, a cash payment for Units
will be made to those Limited Partners within ten (10) business days
following the expiration date of the Offer, as long as Arlington Fund has
received from those Limited Partners a properly completed and duly executed
Agreement of Sale and assurances from the general partner of the
Partnership that the address applicable to the holder of those Units will
be changed to the Purchaser's address. The Purchasers may accept only a
portion of the Units tendered by a Limited Partner in the event a total of
more than 3,988 Units are tendered.
"Given the complicated procedure for transferring limited partnership
interests, the potential proration of units, the need to verify correct
ownership information of all tendered units and the need to receive
assurances that the general partner of the Partnership will allow tendered
units to be transferred to the Purchaser, the Purchaser has determined and
believes that it may take up to ten days to issue payment for tendered
units."
The first paragraph of The Offer-Section 10-Certain Information concerning the
Partnership is amended in its entirety to read as follows:
"Except as otherwise indicated, information contained in this Section 10 is
based on filings made by the Partnership with the SEC. The Purchaser has no
information that any statements contained in this Section 10 are untrue and
cannot verify the accuracy or completeness of any information derived from
those filings. The Purchaser cannot verify any failure by the Partnership
to disclose events unknown to the Purchaser that may have occurred and/or
may affect the significance or accuracy of any information contained in
this Section 10."
The Offer-Section 10-Certain Information concerning the Partnership is amended
to include the following:
"402 Julia is a Delaware limited partnership formed on July 25, 1989 to
acquire, construct, rehabilitate, operate and manage a building with 24
residential units and approximately 3,900 net rentable square feet of
commercial space located thereon at 402 Julia Street, New Orleans,
Louisiana. The Partnership's original investment in 402 Julia represented
approximately 4% of the aggregate funds initially available for investment.
The Partnership has a 65% ownership interest in 402 Julia.
"402 Julia issued a mortgage note secured by the property with an original
principal balance of $1,100,000, bearing interest at 6.69%, and amortizing
over 30 years. The mortgage note has a yield maintenance prepayment penalty
through May 2008. The mortgage note matures in August 2008 at which time
the then unpaid principal balance of $936,939, assuming no prepayments,
will be due.
"The property is located in a competitive downtown market with several
residential properties in the area. For the year ended December 31, 2001,
402 Julia recorded an economic occupancy of 94% for its residential units
and an economic occupancy of 100% for its commercial space for a combined
economic occupancy of 95%. For the year ended December 31, 2001, the
average effective annual income for the residential space
was approximately $8,911 per unit and for the commercial space was
approximately $11.26 per square foot.
"402 Julia leases residential units under either short-term annual
operating leases or month-to-month arrangements. At December 31, 2001,
approximately 49% of residential units are leased under month-to-month
arrangements. 402 Julia also leases commercial units under either long-term
operating leases or month-to-month arrangements. At December 31, 2001, the
schedule of commercial lease expirations for 402 Julia is as follows:
Number of Square Annual % of Gross
Year Tenants Footage Rent Annual Rents
----------------------------------------------------------------------
2004 1 2,000 $ 18,000 7.0%
2005 1 1,900 16,200 6.3%
"Portland Lofts is a Delaware limited partnership formed on August 8, 1989
to acquire, construct, rehabilitate, operate and manage three buildings
containing 89 residential units, including 29,250 square feet of ground
floor commercial space, located at 555 Northwest Park Avenue in Portland,
Oregon. The Partnership's original investment in Portland Lofts represented
approximately 21% of the aggregate funds initially available for
investment.
"During September 2001, the Partnership pursued certain rights contained
within the Portland Lofts' Partnership Agreement. At the close of business
on December 31, 2001, the Partnership, Portland Lofts and the local general
partner entered into an agreement whereby the local general partner
withdrew from Portland Lofts and assigned its .9% general partnership
interest and .1% limited partnership interest to Portland Lofts Apartments,
LLC (a Delaware Limited Liability Company formed on December 14, 2001 and
owned 99.9% by the Partnership and .1% by BHP) and paid a withdrawal fee of
$250,000 to Portland Lofts. Prior to the close of business on December 31,
2001, the Partnership owned a 99% interest in Portland Lofts.
"Portland Lofts issued a mortgage note secured by the property with an
original principal balance of $5,625,000, bearing interest at 9% amortizing
over 25 years. The mortgage note has a yield maintenance prepayment penalty
through its maturity date of July 2006 at which time the then unpaid
principal balance of $4,654,082, assuming no prepayments, will be due.
"The property is located in a competitive downtown market with several
other residential properties in the area. For the year ended December 31,
2001, the economic occupancy of its residential units was 92% and the
economic occupancy for its commercial space was 95% for a combined economic
occupancy of 93%. For the year ended December 31, 2001, the average
effective annual income for the residential space was $11,237 per unit and
for the commercial space was approximately $12.16 per square foot.
"Portland Lofts leases residential units under either short-term annual
operating leases or month-to-month arrangements. At December 31, 2001,
approximately 66% of residential units are leased under month-to-month
arrangements. Portland Lofts also leases commercial units principally under
long-term operating leases as well as month-to-month arrangements.
"At December 31, 2001, the schedule of commercial lease expirations for
Portland Lofts is as follows:
Number of Square Annual % of Gross
Year Tenants Footage Rent Annual Rents
------------------------------------------------------------------------
2002 4 4,985 $32,587 2.2%
2003 4 5,110 46,373 3.2%
2004 2 9,360 55,444 3.8%
2005 1 2,835 7,363 0.5%
2006 1 - 2,182 0.2%
"TCAMP is a Delaware limited liability company formed to own, operate and
manage a building containing 255 residential units and approximately 2,250
square feet of first floor commercial space located at 250 East Sixth
Street in St. Paul, Minnesota. The Partnership's original investment in the
Cosmopolitan property represented approximately 39% of the aggregate funds
initially available for investment.
"On March 30, 2001, TCAMP issued a mortgage note payable in the amount of
$14,000,000, bearing interest at 6.995%, requiring monthly principal and
interest payments totaling $93,095 which commenced May 1, 2001, with the
unpaid principal balance under the mortgage note payable on May 1, 2011.
The mortgage note payable is secured by TCAMP's property, rents, and
assignment of leases. Concurrently, TCAMP entered into an agreement with
its other member owning the remaining 50% membership interest not owned by
the Partnership to redeem ninety-eight percent of her existing membership
interest, thereby reducing her membership interest in TCAMP to 1%. Proceeds
of the mortgage note payable were used to pay in full TCAMP's previous
mortgage note payable, closing costs, make deposits to required escrow
accounts, redeem principally all of the membership interest not owned by
the Partnership, and provide excess funds to TCAMP.
"The property is located in a competitive downtown market with several
other residential properties in the area. For the year ended December 31,
2001, the economic occupancy of TCAMP was 95%. For the year ended December
31, 2001, the average effective annual income for the residential space was
approximately $10,599 per unit and for the commercial space was
approximately $15.34 per square foot. TCAMP leases residential units under
either short-term annual operating leases or month-to-month arrangements.
At December 31, 2001, approximately 9% of residential units are leased
under month-to-month arrangements. TCAMP's commercial space consists of one
office tenant whose lease expires March 2005. The annual rental income for
this lease through 2004 is $35,837 and in 2005 shall be $8,959, (0.3% of
gross annual rents)."
The Offer-Section 15-Certain Conditions of the Offer is amended in its entirety
to read as follows:
"Purchaser will not be required to accept for payment or to pay for any
Units tendered, and may amend or terminate the Offer if: the general
partner of the Partnership or its transfer agent are unable to confirm
after being contacted by the Purchaser that, upon the purchase of the
Units, the Purchaser will be entitled to receive all distributions, from
any source, from the Partnership after November 29, 2002, and that the
Partnership will change the address associated with the holder of the Units
to Purchaser's address; or the Agreement of Sale is not properly completed
and duly executed.
"Limited partners may independently confirm the satisfaction of the first
condition of this Section 15 by contacting the general partner of the
Partnership at the telephone number located in Section 10 of the Offer. The
conditions set forth in this Section 15 are for the sole benefit of the
Purchaser and its affiliates and may be asserted by the Purchaser
regardless of the circumstances giving rise to that condition. The
conditions set forth in this Section 15 may be waived by the Purchaser, in
whole or in part, from time to time in its sole discretion on or prior to
the expiration of the offer. The failure by the Purchaser at any time on or
prior to the expiration of the offer to exercise these rights will not be
deemed a waiver of those rights, which rights will be deemed to be ongoing
and may be asserted at any time and from time to time on or prior to the
expiration of the offer. Any determination by the Purchaser concerning the
events described in this Section 15 will be final and binding upon all
parties. The Purchaser confirms that it has disclosed all conditions of the
Offer and that all conditions of the Offer must be satisfied prior to the
expiration of the Offer."
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: December 12, 2002 Equity Resource Arlington Fund Limited Partnership,
a Massachusetts limited partnership
By: /s/ Eggert Dagbjartsson
--------------------------
Eggert Dagbjartsson
General Partner
Equity Resources Group, Inc.
A Massachusetts Corporation
By: /s/ Eggert Dagbjartsson
--------------------------
Eggert Dagbjartsson
Executive Vice President
Eggert Dagbjartsson
By: /s/ Eggert Dagbjartsson
--------------------------
Eggert Dagbjartsson
EXHIBIT INDEX
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Sequential
Exhibit No. Description Page Number
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(a)(1) - Offer to Purchase, dated November 29, 2002* 4-28
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(a)(2) - Transmittal letter, dated November 29, 2002* 29
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(a)(3) - Agreement of Sale and Assignment* 30-33
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(a)(4) Summary Advertisement* 34
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(b) - Not applicable.
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(c) - Not applicable.
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(d) - Not applicable.
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(e) - Not applicable.
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(f) - Not applicable.
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(g) Not applicable
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(h) Not applicable.
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