UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): June 19, 2008
AMERICA FIRST TAX EXEMPT INVESTORS, L.P.
(Exact name of Registrant as specified in its charter)
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| Delaware
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000-24843
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47-0810385 |
(State or other jurisdiction of
incorporation)
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(Commission File Number)
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(IRS Employer Identification No.) |
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| 1004 Farnam Street, Suite 400, Omaha, Nebraska |
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68102 |
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of fices)
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(Zip Code) |
Registrant’s telephone number, including area code: (402) 444-1630
Not applicable
(Former name, former address and former fiscal year, if applicable)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 1.01 Entry into a Material Definitive Agreement.
On June 19, 2008, America First Tax Exempt Investors, L.P., a Delaware limited partnership
(the “Registrant”), exercised its right of first refusal to acquire all of the Puttable Floating
Option Tax-Exempt Receipts (the “P-Floats”) issued through the Registrant’s tender option bond
financing arrangement with Merrill Lynch Capital Services, Inc. Under this financing program, the
Registrant had, from time to time, placed some of its tax-exempt mortgage bonds (the “Financed
Bonds”) into trusts maintained by State Street Bank and Trust Company, National Association as
trustee (the “Trusts”). The Trusts issued the P-Floats to unaffiliated institutional investors and
subordinated residual interest securities (known as “RITES”) to the Registrant. The Registrant
received the net proceeds from the sale of the P-Floats and applied these proceeds to acquire
additional tax-exempt mortgage bonds and other investments consistent with its investment policies
and for other partnership purposes.
As the holder of the RITES, the Registrant has a call option on the P-Floats which allows the
Registrant to collapse the Trusts at any time. The Registrant has exercised its right to acquire
the P-Floats in anticipation of a refinancing of its current financing arrangement through a
similar tender option bond financing program. The aggregate purchase price of the P-Floats is
approximately $65.1 million. The Registrant expects to enter into a bridge loan agreement on June
26, 2008, that will allow it to meet the P-Float purchase obligation. Upon acquisition of the
P-Floats, the Registrant will own 100% of the beneficial interests in each Trust and will have the
right to terminate the Trusts and reacquire the Financed Bonds. The Registrant expects to then
place the Financed Bonds into similar trusts under a new tender option bond financing program and
to use the proceeds realized from such new financing program to pay the bridge loan used to acquire
the P-Floats. The Registrant expects to enter this new tender option bond financing arrangement
with another lender on or before July 3, 2008. Both the bridge loan agreement and the new tender
option bond financing agreement will be between the Registrant and Bank of America, N.A. (or a Bank
of America affiliate). The Registrant, however, has not yet entered into a definitive agreement
with Bank of America with respect to a new tender option bond financing arrangement and does not
expect to do so until the closing date for such financing, if any.
The Registrant expects to lower its cost of borrowings and increase the amount of cash
available for distribution to holders of its Beneficial Unit Certificates by replacing its existing
financing under the Merrill Lynch P-Float program with a new tender option bond financing
arrangement with Bank of America. The Registrant’s cost of borrowings under the Merrill Lynch
P-Float program has increased significantly since late 2007 due to credit rating downgrades at
Merrill Lynch. It is expected that the cost of borrowings under a replacement financing facility
with Bank of America will reduce the Registrant’s cost of borrowing to more historical levels and
result in significant interest savings to the Registrant.
There is no affiliation between the Registrant, on the one hand, and Merrill Lynch, State
Street Bank National Association or Bank of America, N.A. on the other hand.
Item 9.01 Financial Statements and Exhibits.
99. Press Release, dated June 25, 2008, issued by Registrant announcing termination of Merrill
Lynch P-Float financing and anticipated refinancing with new tender option bond financing with Bank
of America, N.A.