-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, NfllYvX6NON4vlDu5Z7MDkbDO/vwsHQDy/bzUy8ERPAPBYa8NKWEjdfNZHeYvqKs jyPpBX2HxUi0M71wfsqcJQ== 0000950131-94-000106.txt : 19940207 0000950131-94-000106.hdr.sgml : 19940207 ACCESSION NUMBER: 0000950131-94-000106 CONFORMED SUBMISSION TYPE: 424B3 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19940204 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FORUM RETIREMENT PARTNERS L P CENTRAL INDEX KEY: 0000804752 STANDARD INDUSTRIAL CLASSIFICATION: 8300 IRS NUMBER: 351686799 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 424B3 SEC ACT: 33 SEC FILE NUMBER: 033-71498 FILM NUMBER: 94504633 BUSINESS ADDRESS: STREET 1: 8900 KEYSTONE CROSSING STE 200 STREET 2: PO BOX 40498 CITY: INDIANAPOLIS STATE: IN ZIP: 46240 BUSINESS PHONE: 3178460700 424B3 1 PRO SUPP RULE NO. 424(b)(3) REGISTRATION NO. 33-71498 Prospectus Supplement (To Prospectus Dated January 10, 1994) FORUM RETIREMENT PARTNERS, L.P. Up to 5,064,150 Preferred Depositary Units Representing Preferred Limited Partners' Interests The Prospectus dated January 10, 1994 (the "Prospectus") for Forum Retirement Partners, L.P. (the "Partnership") is supplemented with the following information. Except as indicated below under "Extension of Expiration Date and Revocation Rights", all terms and conditions of the Subscription Offering contained in the Prospectus remain in full force and effect. Terms used in this Prospectus Supplement which are defined in the Prospectus are used herein as so defined. EXTENSION OF EXPIRATION DATE AND REVOCATION RIGHTS The Expiration Date of the Subscription Offering has been extended to Tuesday, February 15, 1994, at 5:00 P.M., New York City time. Any Eligible Holder who exercised the right to purchase additional Units under the Subscription Offering prior to the Expiration Date may revoke such exercise by providing notice of revocation to the Subscription Agent on or prior to Tuesday, February 15, 1994, at 5:00 P.M. New York City time. Any such revocation must (i) be in writing signed by the Eligible Holder in exactly the same manner in which the Notice of Exercise was previously signed, (ii) be received by the Subscription Agent by the date and time specified above (the Subscription Agent is American Stock Transfer & Trust Company, 40 Wall Street, 46th Floor, New York, New York 10005, Attention: Reorganization Department), (iii) include the name, address, and telephone number of the Eligible Holder, and (iv) specify whether the prior exercise of the Subscription Privilege is to be revoked in whole or in part (and, if the revocation is partial, the exact number of previously subscribed for Preferred Depositary Units as to which the Subscription Privilege is being revoked). NO SUCH REVOCATION MAY BE WITHDRAWN AND, UPON RECEIPT BY THE SUBSCRIPTION AGENT OF ANY SUCH REVOCATION, AN ELIGIBLE HOLDER WILL BE DEEMED, WITHOUT FURTHER ACTION, TO HAVE IRREVOCABLY WAIVED ITS RIGHT TO PARTICIPATE IN THE SUBSCRIPTION OFFERING (EXCEPT AS TO PARTIAL REVOCATIONS, AND THEN ONLY AS TO THE NUMBER OF PREFERRED DEPOSITARY UNITS AS TO WHICH THE REVOCATION DOES NOT APPLY). See "Subscription Offering" in the accompanying Prospectus for a description of the other terms of the Subscription Offering, all of which remain in full force and effect except as set forth in this Prospectus Supplement. RECENT DEVELOPMENTS 1993 FOURTH QUARTER AND FULL YEAR RESULTS OF OPERATIONS On February 3, 1994, the Partnership issued a press release (the "Earnings Release") announcing its results of operations for the quarter and year ended December 31, 1993. The text of the Earnings Release is as follows: "February 3, 1994, Indianapolis, Indiana" "FORUM RETIREMENT PARTNERS REPORTS OPERATIONS" -------------------------------------------- "Forum Retirement Partners, L.P. (the "Partnership"), the Indianapolis-based retirement community master limited partnership, today announced operating results for the quarter and year ended December 31, 1993:
Quarter Ended Year Ended December 31, December 31, 1993 1992 1993 1992 --------- --------- --------- ---------- (in thousands except per unit amounts) Revenues: Operating revenues $11,464 $10,697 $43,797 $ 41,648 Other income 142 31 379 302 ------- ------- ------- -------- Total revenues 11,606 10,728 44,176 41,950 ------- ------- ------- -------- Costs and expenses: Operating expenses $ 8,425 8,505 32,969 33,873 Management fees (deferred) 927 858 3,516 3,337 to parent of general partner Depreciation 850 793 3,356 3,391 Interest: Parent of general partner 11 16 50 68 Other 1,362 1,601 6,056 7,442 ------- ------- ------- -------- Total costs and expenses 11,575 11,773 45,947 48,111 ------- ------- ------- -------- Income (loss) before general partner's interest in income (loss) of subsidiary partnerships and extraordinary charge 31 (1,045) (1,771) (6,161) General partner's interest in income (loss) of subsidiary partnerships 2 (6) (9) (49) ------- ------- ------- -------- Income (loss) before extraordinary charge 29 (1,039) (1,762) (6,112) Extraordinary charge - early extinguishment of debt (2,917) -0- (2,917) -0- ------- ------- ------- -------- Net loss (2,888) (1,039) (4,679) (6,112) General partner's interest in net loss 29 10 47 61 ------- ------- ------- -------- Limited partners' interest in net loss $(2,859) $(1,029) $(4,632) $ (6,051) ======= ======= ======= ======== Average number of units outstanding 14,861 8,785 10,317 8,785 Net income (loss) per unit: Income (loss) before extraordinary charge $ -0- $ (0.12) $ (0.17) $ (0.69) Extraordinary charge (0.19) -0- (0.28) -0- ------- ------- ------- -------- Net loss $ (0.19) $ (0.12) $ (0.45) $ (0.69)" ======= ======= ======= ========
S-2 "A Partnership spokesperson said, `Results of operations for the full year ended December 31, 1993 were above expectations. Combined occupancy at December 31, 1993, was 94%, compared to 90% at December 31, 1992. Operating income for 1993 (operating revenues less operating expenses) increased by $3,053,000, or 39%, compared to operating income for 1992. Occupancy has stabilized and operations continue to improve, the Partnership has been recapitalized by the Partnership's previously announced sale of equity interests and refinancing of its long-term debt, and the Partnership had cash and cash equivalents of $4,700,000 at December 31, 1993.' The spokesperson continued, `Excluding the effects of the sale of one of the Partnership's RCs in the first quarter of 1992, the Partnership's operating revenues increased 7% for the quarter ended December 31, 1993 and 11% for the year ended December 31, 1993, respectively, over operating revenues for the comparable periods in 1992, and the Partnership's operating income for those periods in 1993 was 39% and 43%, respectively, higher than its operating income for comparable periods in 1992." "The Partnership's units are traded on the American Stock Exchange (ticker symbol: FRL)." For additional information relating to the Partnership's financial position and results of operations, see "Available Information;" "Prospectus Summary;" "Risk Factors;" and "Pro Forma Financial Information" in the accompanying Prospectus. CERTAIN LEGAL PROCEEDINGS On January 24, 1994, the Russell F. Knapp Revokable Trust, a substantial Unitholder of the Partnership that purchased Preferred Depositary Units in 1992 (the "Plaintiff"), filed a complaint (the "Complaint") in the United States District Court for the Northern District of Iowa against the Partnership's General Partner alleging breach of the Partnership Agreement, breach of fiduciary duty, fraud, and civil conspiracy. The Complaint alleges, among other things, that the Board of Directors of the General Partner is not comprised of a majority of Independent Directors, as required by the Partnership Agreement and as allegedly represented in the 1986 Prospectus of the Partnership (the "1986 Prospectus"), and that the General Partner's Board of Directors has approved and/or acquiesced in 8% management fees being charged by Forum Group under the Management Agreement. The Complaint further alleges that the "industry standard" for such fees is 4% thereby resulting in an "overcharge" to the Partnership estimated by the Plaintiff at $1.8 million per annum, beginning in 1994. The Plaintiff is seeking the restoration of certain former directors to the Board of Directors of the General Partner and the removal of certain other directors from such Board, an injunction prohibiting the payment of 8% management fees, and unspecified compensatory and punitive damages. For additional information relating to this matter, see "Risk Factors -- Conflicts of Interests" in the accompanying Prospectus. The General Partner believes that the allegations in the Complaint are without merit and intends vigorously to defend against this litigation. Forum Group manages all of the Properties pursuant to a Management Agreement under which Forum Group is entitled to management fees equal to 8% of the Partnership's gross operating revenues. Pursuant to the Management Agreement, management fees payable to Forum Group for periods from the formation of the Partnership in 1986 to December 31, 1993 were deferred, and such deferred fees are payable only if certain conditions occur. Under the terms of the Management Agreement entered into in connection with the formation of the Partnership in 1986, and as disclosed in the 1986 Prospectus, Forum Group's management fees for periods after December 31, 1993 will not be deferred. For additional information relating to the Management Agreement and the Partnership Agreement, see "Business and Properties of the Partnership -- Management Agreement" and "Summary of the Partnership Agreement," respectively, in the accompanying Prospectus. The date of this Prospectus Supplement is February 3, 1994. S-3 =============================================================================== NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR IN THE PROSPECTUS IN CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE PARTNERSHIP. THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITY OTHER THAN THE PREFERRED DEPOSITARY UNITS OFFERED BY THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS, NOR DO THEY CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY THE PREFERRED DEPOSITARY UNITS BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO, OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. ________________________________________ TABLE OF CONTENTS
PAGE PROSPECTUS SUPPLEMENT EXTENSION OF EXPIRATION DATE AND REVOCATION RIGHTS....................... S-1 RECENT DEVELOPMENTS...................................................... S-1 PROSPECTUS AVAILABLE INFORMATION.................................................... 2 INFORMATION INCORPORATED BY REFERENCE.................................... 2 PROSPECTUS SUMMARY....................................................... 3 RISK FACTORS............................................................. 11 THE PARTNERSHIP.......................................................... 15 THE RECAPITALIZATION..................................................... 16 USE OF PROCEEDS.......................................................... 19 PRO FORMA FINANCIAL INFORMATION.......................................... 19 CASH DISTRIBUTION POLICY................................................. 23 THE SUBSCRIPTION OFFERING................................................ 24 BUSINESS AND PROPERTIES OF THE PARTNERSHIP............................... 27 DESCRIPTION OF PREFERRED DEPOSITARY UNITS................................ 35 SUMMARY OF PARTNERSHIP AGREEMENT......................................... 38 FEDERAL INCOME TAX CONSIDERATIONS........................................ 45 PLAN OF DISTRIBUTION..................................................... 62 SUBSCRIPTION AGENT....................................................... 62 EXPERTS.................................................................. 62 LEGAL OPINIONS........................................................... 63
=============================================================================== =============================================================================== 5,064,150 PREFERRED DEPOSITARY UNITS FORUM RETIREMENT PARTNERS, L.P. ____________________ PROSPECTUS SUPPLEMENT ____________________ FEBRUARY 3, 1994 =============================================================================== -----END PRIVACY-ENHANCED MESSAGE-----