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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 13E-3
Rule 13e-3 Transaction Statement
(Pursuant to Section 13(e) of the Securities Exchange Act of 1934 and
Rule 13e-3(ss. 240.13e-3) thereunder)
Amendment No. 4
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Krupp Realty Fund, Ltd. - III
(Name of Issuer)
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KRF3 Acquisition Company, L.L.C.
KRF Company, L.L.C.
The Krupp Family Limited Partnership - 94
(Name of Person(s) Filing Statement)
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Limited Partnership Units
(Title of Class of Securities)
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501128 10 2
(CUSIP Number of Class of Securities)
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Scott D. Spelfogel, Esq.
The Berkshire Group
One Beacon Street
Boston, Massachusetts 02108
(617) 574-8385
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications on Behalf of Person(s) Filing Statement)
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With copies to:
James M. Dubin, Esq.
Paul, Weiss, Rifkind, Wharton & Garrison
1285 Avenue of the Americas
New York, New York 10019-6064
(212) 373-3000
This statement is filed in connection with (check appropriate box):
a. |_| The filing of solicitation materials or an information statement
subject to Regulation 14C or Rule 13e-3(c) under the Securities
Exchange Act of 1934.
b. |_| The filing of a registration statement under the Securities Act of
1933.
c. |X| 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: |_|
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CALCULATION OF FILING FEE
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Transaction Valuation: $13,750,000 Amount of filing fee: $2750.00
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o Transaction valuation assumes the purchase of 25,000 units Krupp Realty
Fund, Ltd. - III. at $550 in cash per Unit. The amount of the filing
fee, calculated in accordance with Regulation 240.0-11 of the
Securities Exchange Act of 1934, equals one fiftieth of one percentum
of such transaction value.
|X| Check box if any part of the fee is offset by Rule 0-11(a)(2) and
identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by either a registration statement number,
or the Form or Schedule and the date of its filing.
Amount Previously Paid: $2750.00
Filing Parties: KRF3 Acquisition Company, L.L.C., KRF Company, L.L.C. and
The Krupp Family Limited
Partnership-94
Form or Registration No.: Schedule 14D-1
Date Filed: May 14, 1999
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<PAGE>
This Amendment No. 4, dated June 11, 1999 (the "Amendment"), to the
Rule 13E-3 Transaction Statement originally filed with the Securities and
Exchange Commission on May 14, 1999 and amended by Amendment No. 1 thereto dated
May 20, 1999, Amendment No. 2 thereto dated May 28, 1999 and Amendment No. 3
thereto dated June 4, 1999 (collectively, the "Statement"), attaches a press
release issued by the Purchaser on June 11, 1999, Supplement No. 2 to the Offer
to Purchase dated June 14, 1999 and a revised Agreement of Assignment and
Transfer and amends and supplements Item 4(a) of the Statement and amends and
restates Item 16 of the Statement.
This Amendment and the Statement relate to a tender offer by the
Purchaser to purchase any and all outstanding investor limited partnership
interests (the "Units") of Krupp Realty Fund, Ltd. - III, a limited partnership
organized under the laws of Massachusetts, for $550 per Unit, in cash, less the
aggregate amount of distributions per Unit, if any made after May 14, 1999,
without interest, upon the terms and subject to the conditions set forth in the
Offer to Purchase dated as of May 14, 1999, the Supplement to the Offer to
Purchase dated as of May 14, 1999 and Supplement No. 2 to the Offer to Purchase
dated as of June 11, 1999 (collectively, the "Offer to Purchase"), and in the
related Agreement of Assignment and Transfer, as amended (which together
constitute the "Offer").
This Amendment No. 4 reflects the Purchaser's extension of the date and
time at which the Offer to Purchase expires from 12:00 midnight, New York City
time, on June 11, 1999 to 12:00 midnight, New York City time, on June 18, 1999.
This Amendment No. 4 also reflects the Purchaser's waiver of the
minimum condition.
Unless otherwise indicated herein, each capitalized term used but not
defined herein shall have the meaning assigned to such term in the Statement or
in the Offer to Purchase. All references in the Statement to the Offer to
Purchase and the Offer are deemed to be the Offer to Purchase, as amended and
supplemented as of the date hereof, and the Offer, as reconstituted on the date
hereof.
2
<PAGE>
Item 4. Terms of the Transaction.
Item 4(a) of the Rule 13E-3 Transaction Statement is hereby amended and
supplemented as follows:
As set forth in the press release dated as of June 11, 1999, attached
hereto as Exhibit No. (d)(11) (the "Press Release"), the complete text of which
is hereby incorporated herein by reference, the Purchaser has extended the time
and date of expiration of the Offer to 12:00 midnight, New York City time, on
Friday, June 18, 1999 (the "New Expiration Date") and has waived the Minimum
Condition.
Item 16. Additional Information.
Item 16 of the Rule 13E-3 Transaction Statement is hereby amended and
restated as follows:
Additional information concerning the Offer is set forth in the Offer
to Purchase, the two Supplements to the Offer to Purchase and the revised
Agreement of Assignment and Transfer, copies of which are attached hereto as
Exhibits (d)(1), (d)(2), (d)(12) and (d)(13) and are incorporated herein by
reference.
Item 17. Material to be Filed as Exhibits.
Item 17 of the Rule 13E-3 Transaction Statement is hereby amended and
supplemented by adding the following exhibits thereto:
Exhibit No. Description
(d)(11) Press Release dated June 11, 1999
(d)(12) Supplement No. 2 to the Offer to Purchase dated June 11, 1999
(d)(13) Revised Agreement of Assignment and Transfer
(d)(14) Letters to Unitholders dated June 11, 1999
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this Amendment is true, complete and correct.
Dated as of: June 11, 1999
KRF3 Acquisition Company, L.L.C.
By: KRF Company, L.L.C.,
its sole member
By: The Krupp Family Limited
Partnership - 94,
its sole member
By: /s/ Douglas Krupp
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Name: Douglas Krupp
Title: General Partner
KRF Company, L.L.C.
By: The Krupp Family Limited
Partnership - 94,
its sole member
By: /s/ Douglas Krupp
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Name: Douglas Krupp
Title: General Partner
The Krupp Family Limited Partnership - 94
By: /s/ Douglas Krupp
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Name: Douglas Krupp
Title: General Partner
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
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(d)(11) Press Release dated June 11, 1999
(d)(12) Supplement No. 2 to the Offer to Purchase dated June 11, 1999
(d)(13) Revised Agreement of Assignment and Transfer
(d)(14) Letters to Unitholders dated June 11, 1999
NEWS RELEASE
FOR IMMEDIATE RELEASE
For further information call:
Phil Darby
Krupp Funds Group
1-800-25-KRUPP
KRF3 ACQUISITION COMPANY, L.L.C.
EXTENDS CASH TENDER OFFER
FOR UNITS OF KRUPP REALTY FUND, LTD. - III
UNTIL 12:00 MIDNIGHT NEW YORK CITY TIME
ON FRIDAY, JUNE 18, 1999
AND WAIVES THE MINIMUM CONDITION
Boston, MA - June 11, 1999 - KRF3 Acquisition Company, L.L.C. (the
"Purchaser") announced today that the tender offer for all of the issued and
outstanding investor limited partnership interests (the "Units") of Krupp Realty
Fund, Ltd. - III at a price of $550.00 per Unit, net to the seller in cash less
Partnership distributions made after May 14, 1999, has been extended until 12:00
midnight, New York City time, on Friday, June 18, 1999. The tender offer was
originally scheduled to expire at 12:00 midnight, New York City time, on Friday,
June 11, 1999. Unitholders have the right to withdraw their acceptance of the
tender offer, in whole or in part, at any time prior to the current scheduled
expiration date of the offer (i.e. 12:00 midnight, New York City time, on
Friday, June 18, 1998). The Purchaser has reserved the right to extend the
tender offer beyond the Friday, June 18, 1999 expiration date, but has not
indicated an intent to do so.
The Purchaser also announced that the tender offer has been amended to
waive the minimum condition. The obligation of the Purchaser to consummate the
tender offer was originally conditioned upon a majority of the total outstanding
Units being tendered by holders. The offer, as amended, now has no minimum
condition. Holders of Units who have already accepted the tender offer, but
whose willingness to accept is affected by the minimum condition having been
waived may withdraw their acceptances.
With the exception of the waiver of the minimum condition, the terms of
the extended offer are identical to those in the original tender offer contained
in the tender offer materials filed with the Securities and Exchange Commission
on May 14, 1999 and supplemented in subsequent filings with the Securities and
Exchange Commission.
<PAGE>
2
The Purchaser is distributing a supplement (the "Supplement") to the
offer to purchase, dated May 14, 1999 (as previously supplemented by the
Supplement dated May 14, 1999), which amends and supplements the offer to
purchase. The Supplement contains important information that should be read by
all holders of Units.
By 9:00 a.m. on June 11, 1999, New York City time, valid acceptances of
the offer had been received in respect of 7,862.5 Units representing
approximately 31.45 percent of Units.
SUPPLEMENT NO. 2 TO THE OFFER TO PURCHASE
This Supplement (the "Supplement") supplements the Offer to Purchase,
dated May 14, 1999, previously supplemented by the Supplement dated May 14, 1999
(as so supplemented, the "Offer to Purchase") with respect to the offer by KRF3
Acquisition Company, L.L.C. (the "Purchaser") to purchase all of the limited
partnership interests ("Units") of Krupp Realty Fund, Ltd.-III at a price of
$550 per Unit, payable to the holder in cash, less the aggregate amount of
distributions per Unit, if any, made by the Partnership from and after May 14,
1999, without interest. This Supplement should be read in conjunction with the
Offer to Purchase. Capitalized terms used but not defined herein have the
meanings assigned to them in the Offer to Purchase.
The purpose of this Supplement is to (1) extend the expiration date of
the Offer and (2) waive the Minimum Condition. The Offer has been extended to
12:00 midnight, New York City time, on June 18, 1999, unless further extended
(the "Expiration Date"). The Minimum Condition has been waived so that the Offer
is no longer conditioned upon a minimum number of shares of Units being validly
tendered and not withdrawn prior to the Expiration Date. EXCEPT AS SET FORTH
HEREIN, THE TERMS AND CONDITIONS OF THE OFFER REMAIN AS SET FORTH IN THE OFFER
TO PURCHASE.
THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION. NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE FAIRNESS OR MERITS OF THIS TRANSACTION NOR UPON THE ACCURACY OR ADEQUACY OF
THE INFORMATION CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY
IS UNLAWFUL.
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THE OFFER HAS BEEN EXTENDED TO 12:00 MIDNIGHT, NEW YORK CITY TIME ON
JUNE 18, 1999 (THE "EXPIRATION DATE"). UNITS TENDERED PURSUANT TO THE OFFER MAY
BE WITHDRAWN AT ANY TIME PRIOR TO THE EXPIRATION DATE.
UNITHOLDERS WHO HAVE PREVIOUSLY VALIDLY TENDERED AND NOT PROPERLY
WITHDRAWN THEIR UNITS PURSUANT TO THE OFFER ARE NOT REQUIRED TO TAKE ANY FURTHER
ACTION.
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THE DATE OF THIS SUPPLEMENT IS JUNE 11, 1999.
<PAGE>
2
AMENDMENTS TO THE OFFER TO PURCHASE
The following sections of the Offer to Purchase have been modified as
described below. Except as set forth below and elsewhere in this Supplement, the
terms and conditions of the Offer remain as stated in the Offer to Purchase.
COVER PAGE
The first paragraph of the cover page is amended by deleting such
paragraph and substituting the following therefor:
"THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT MIDNIGHT NEW
YORK CITY TIME, ON JUNE 18, 1999, UNLESS THE OFFER IS
EXTENDED."
The third paragraph of the cover page is amended by deleting such
paragraph and substituting the following therefor:
"The Offer is conditioned upon, among other things, the
satisfaction of the conditions set forth in "The
Offer--Section 8. Conditions of the Offer," any of which, the
Purchaser reserves the right to waive without notice to the
Unitholders. The Offer is not subject to any financing
condition and is not conditioned on any minimum number of
Units being validly tendered and not withdrawn prior to the
Expiration Date ( the "Minimum Condition"). "
INTRODUCTION
This section is amended by deleting the second paragraph thereof and
substituting the following therefor:
"The Offer is conditioned upon, among other things, the
satisfaction of the conditions set forth in "The
Offer--Section 8. Conditions of the Offer," any of which, the
Purchaser reserves the right to waive without notice to the
Unitholders. The Offer is not subject to any financing
condition and is not conditioned on any minimum number of
Units being validly tendered and not withdrawn prior to the
Expiration Date ( the "Minimum Condition"). "
This section is further amended by deleting the fifth sentence of the
third paragraph thereof and substituting the following therefor:
"The Purchaser may, following the consummation of the Offer,
propose and seek to have the Partnership consummate a merger
or similar business combination with the Purchaser (the
"Proposed Merger"). In the event the Purchaser acquires a
majority of the outstanding Units in the Offer, the Purchaser
currently intends to propose the Proposed Merger."
This section is further amended by deleting the final sentence of the
fourth paragraph thereof and substituting the following therefor:
"Accordingly, if the Purchaser seeks to consummate the
Proposed Merger it will propose and seek to have the
Partnership amend the Partnership Agreement to permit the
Partnership to enter into a merger agreement as described
above and to consummate the Proposed Merger (the "Proposed
Amendment")."
This section is further amended by deleting the sentence comprising the
fifth paragraph thereof.
This section is further amended by deleting the fifth negative factor
listed and substituting therefor:
"Consummation of the Offer will result in a termination of the
Partnership for Federal income tax purposes if 50% or more of
Units will have been sold in the 12-month period preceding
(and including) the date on which the Offer is consummated.
Any such termination will, among other things, cause the
Partnership to start new depreciable lives for its assets.
This generally would decrease the annual average depreciation
deductions allocable to Units not tendered pursuant to the
Offer (thereby increasing the taxable income allocable to such
Units in each such year), but would
<PAGE>
3
have no effect on the total depreciation deductions available
over the useful lives of the assets of the Partnership.
However, if the Purchaser consummates the Offer, and the
Proposed Merger is consummated, Units held by Unitholders who
do not tender their Units in the Offer will be converted into
cash in the Proposed Merger."
SPECIAL FACTORS - SECTION 3. PURPOSE OF THE OFFER AND PLANS FOR THE
PARTNERSHIP-Purpose.
This section is amended and supplemented by deleting the third sentence
of the first paragraph thereof and substituting the following therefor:
"Following consummation of the Offer, the Purchaser may (i)
seek to acquire additional Units through open market
purchases, privately negotiated transactions, a tender offer
or exchange offer or otherwise, upon such terms and at such
prices as it may determine, which may be more or less than the
Offer Price, and/or (ii) solicit the approval of the
Partnership for the Proposed Amendment and Proposed Merger.
Alternatively, the Purchaser may abandon plans to acquire
control of the Partnership or any additional Units and/or sell
or otherwise dispose of any or all of the Units acquired by
them pursuant to the Offer or otherwise, upon such terms and
at such prices as they shall determine. If the Purchaser
acquires a majority of the outstanding Units in the Offer, the
Purchaser intends, as soon as soon as practicable following
consummation of the Offer, to propose and seek to consummate
the Proposed Amendment and the Proposed Merger."
This section is further amended and supplemented by deleting the first
sentence of the fourth paragraph thereof and substituting the following
therefor:
"If the Purchaser acquires a majority of the Units pursuant to
the Offer, as soon as practicable following the consummation
of the Offer the Purchaser intends to solicit (or, pursuant to
the Partnership Agreement, request the General Partners to
solicit) the approval of Unitholders to the Proposed Amendment
and the Proposed Merger. If the Purchaser acquires less than a
majority of the Units pursuant to the Offer, the Purchaser may
also elect to effect such a solicitation."
This section is further amended and supplemented by deleting the third
sentence of the fourth paragraph thereof and substituting the following
therefor:
"Although the Purchaser presently intends to seek to effect
the Proposed Amendment and the Proposed Merger promptly
following the consummation of the Offer if the Purchaser
acquires a majority of the Units pursuant to the Offer, there
is no assurance that such proposals will be made, or that if
proposed, they will not be delayed or abandoned."
This section is further amended by deleting the fifth paragraph
thereof.
SPECIAL FACTORS -- SECTION 4. CONFLICTS OF INTEREST AND TRANSACTIONS WITH
AFFILIATE - Voting Power of the Purchaser.
This section is amended by deleting the first and second sentences
thereof and substituting the following therefor:
"The Offer is not conditioned on any minimum number of Units
being validly tendered and not withdrawn prior to the
Expiration Date. If more than 50% of Units are tendered
pursuant to this Offer, the Purchaser accepts for payment the
Units tendered and the General Partners admit the Purchaser as
a substitute limited partner under the Partnership Agreement
(which admittance allows a Unitholder to vote), then the
Purchaser would have the power to vote a majority of the
Partnership's Units."
<PAGE>
4
SPECIAL FACTORS -- SECTION 7. CERTAIN FEDERAL INCOME TAX CONSEQUENCES.
CONSEQUENCES TO A NON-TENDERING UNITHOLDER.
This section is amended by deleting the first paragraph thereof and
substituting the following therefor:
"Depending on the number of Unitholders who tender their
Units, sales of Units pursuant to the Offer could result in a
sale or exchange of 50% or more of the total Units in
Partnership capital and profits within a 12-month period. If
this occurs, a termination of the Partnership for Federal
income tax purposes will occur and the taxable year of the
Partnership will close. The Properties (subject to related
debt) of the Partnership will be treated as contributed to a
new partnership. The Partnership will then be deemed to
distribute to its Unitholders interests in the new partnership
in a deemed liquidation of the Partnership. Following a
constructive termination of the Partnership, the Partnership
will start a new depreciable life for its assets and, as a
result, the Partnership's current annual depreciation
deductions will be reduced and taken over a longer period of
years than is the case currently. In addition, the
consequences of a termination of the Partnership include
erasure of the Partnership's tax elections and changes in the
methods of depreciation available to the Partnership for tax
purposes."
THE OFFER -- SECTION 7. CERTAIN INFORMATION CONCERNING THE PURCHASER AND
ITS AFFILIATES.
This section is amended by supplementing the following after the eighth
paragraph thereof:
"By 12:00 noon on June 11, 1999, New York City time, valid
acceptances of the Offer had been received in respect of
7,862.5 Units representing approxmately 31.45% of Units.
Pursuant to the Agreement of Assignment of Transfer executed
in connection with such tenders, unless such assignments are
withdrawn, the Purchaser may exercise the voting rights of
such Units."
THE OFFER -- SECTION 8. CONDITIONS OF THE OFFER
This section is amended by deleting the first paragraph thereof and
substituting the following therefor:
"Notwithstanding any other provisions of the Offer and in
addition to (and not in limitation of) the Purchaser's rights
to extend and amend the Offer at any time in its sole
discretion, the Purchaser shall not be required to accept for
payment, purchase or pay for, subject to Rule 14e-1(c) under
the Exchange Act, any tendered Units (whether or not any Units
have theretofore been accepted for payment or paid for
pursuant to the Offer), and may terminate the Offer as to any
Units not then paid for, if (i) the Purchaser shall not have
confirmed to its reasonable satisfaction that, upon purchase
of the Units pursuant to the Offer, the Purchaser will have
full rights to ownership as to all such Units and the
Purchaser will be admitted as a substitute limited partner
under Section 10.3 of the Partnership Agreement, (ii) the
Purchaser shall not have confirmed to its reasonable
satisfaction that, upon the purchase of the Units pursuant to
the Offer, the transfer restrictions set forth in Section 10.4
of the Partnership Agreement are inapplicable, or (iii) all
authorizations, consents, orders or approvals of, or
declarations or filings with, or expirations of waiting
periods imposed by, any court, administrative agency or
commission or other governmental authority or instrumentality,
domestic or foreign, necessary for the consummation of the
transactions contemplated by the Offer shall not have been
filed, occurred or been obtained on or before the Expiration
Date. The Offer is not conditioned on any minimum number of
Units being validly tendered and not withdrawn prior to the
Expiration Date."
<PAGE>
5
Agreement of Assignment and Transfer
The Purchaser has updated its Agreement of Assignment and Transfer,
which is being distributed herewith. Unitholders may use the updated Agreement
of Assignment and Transfer or the originally distributed Agreement of Assignment
and Transfer to tender their Units. All such documents shall be deemed to have
been amended, as appropriate, by this Supplement. If needed, assistance or
additional copies of the Offer to Purchase and Supplement No. 1 can be obtained
by making a request to the Information Agent at the following address:
KRUPP FUNDS GROUP LIMITED PARTNERSHIP
One Beacon Street
Suite 1500
Boston, Massachusetts 02108
Attention: Investor Services
Phone: 1-800-25-KRUPP
(1-800-255-7877)
Fax: (617) 423-8919
REVISED AGREEMENT of ASSIGNMENT and TRANSFER
For Units of Investor Limited Partnership Interests in
Krupp Realty Fund, Ltd. III
Please make any corrections to name/mailing address in space above.
I hereby tender to KRF3 Acquisition Company, L.L.C., a Delaware limited
liability company ("KRF3"), the number of Units of Investor Limited Partnership
Interests (as defined in the Partnership Agreement, defined hereinafter) set
forth above (including any and all other Units or other securities issued or
issuable in respect of such Unit on or after the date hereof) (collectively, the
"Units") in Krupp Realty Fund, Ltd.___III, a Massachusetts limited partnership
(the "Partnership"), for $550.00 per Unit in cash, without any interest thereon,
(reduced by the amount of any cash distributions made to me by the Partnership
on or after May___14, 1999) in accordance with the terms and subject to the
conditions of KRF3's Offer to Purchase attached as Exhibit___(a)(1) to Schedule
___14D1 dated May___14, 1999, the Supplement to the Offer to Purchase dated May
14, 1999 and Supplement No. 2 to the Offer to Purchase dated June 11, 1999
(collectively, the "Offer to Purchase") and this revised Agreement of Assignment
and Transfer (which, together with the Offer to Purchase and any supplements or
amendments, constitutes the "Offer"). I acknowledge that I have received the
Offer to Purchase. The Offer and the withdrawal rights (described further in the
Offer to Purchase "The Offer - Section 4. Withdrawal Rights") will remain open
until 12:00___p.m. New York City time on June___18, 1999, subject to extension
at the discretion of KRF3 (as discussed in the Offer to Purchase "The Offer -
Section 5. Extension of Tender Period; Termination; and Amendment"). It is
understood that payment for the Units tendered hereby will be made by check
mailed to me at the above address promptly after the date of the Partnership's
confirmation that the transfer of the Units to KRF3 is effective, subject to
"The Offer - Section___4. Withdrawal Rights" contained in the Offer to Purchase.
The Offer is subject to "The Offer - Section___8. Conditions of the Offer in the
Offer to Purchase."
Subject to, and effective upon, acceptance of this Agreement of Assignment and
Transfer and payment for the Units tendered hereby in accordance with the terms
and subject to the conditions of the Offer (the "Purchase Date"), I hereby sell,
assign, transfer, convey and deliver to KRF3, all of my right, title and
interest in and to the Units tendered hereby and accepted for payment pursuant
to the Offer and any and all noncash distributions, other Units or other
securities issued or issuable in respect thereof on such date, including,
without limitation, to the extent that they exist, all rights in, and claims to,
any Partnership profits and losses, cash distributions, voting rights and other
benefits of any nature whatsoever and whenever distributable or allocable to the
Units under the Partnership's limited partnership agreement (the "Partnership
Agreement"), (i)___unconditionally to the extent that the rights appurtenant
to the Units may be transferred and conveyed without the consent of the General
Partners of the Partnership (the "General Partners"), and (ii)___in the
event that KRF3 (which is an affiliate of the General Partners) elects to become
a substitute limited partner of the Partnership, subject to the consent of the
General Partners to the extent such consent may be required in order for KRF3 to
become a substitute limited partner of the Partnership.
It is my intention that KRF3 and its designees, if any of them so elects,
succeed to my interest as a Substitute Limited Partner (as defined in
Section___7.5 of the Partnership Agreement) in my place with respect to the
transferred Units. It is my understanding, and I hereby acknowledge and agree,
that KRF3 and its designees shall be entitled to receive all distributions or
other property from the Partnership attributable to the transferred Units that
are made on or after the Purchase Date, including, without limitation, all
distributions of distributable cash flow and net cash proceeds, without regard
to whether the cash or other property that is included in any such distribution
was received by the Partnership before or after the Purchase Date and without
regard to whether the applicable sale, financing, refinancing or other
disposition took place before or after the Purchase Date. It is my further
understanding, and I further acknowledge and agree, that the taxable income and
taxable loss attributable to the transferred Units with respect to the taxable
period in which the Purchase Date occurs shall be divided among and allocated
between me and KRF3 and its designees as provided in the Partnership Agreement,
or in accordance with such other lawful allocation methodology as may be agreed
upon by the Partnership and KRF3. I represent and warrant that I have the full
right, power and authority to transfer the subject Units and to execute this
Agreement of Assignment and Transfer and all other documents executed in
connection herewith without the joinder of any other person or party, and if I
am executing this Agreement of Assignment and Transfer or any other document in
connection herewith on behalf of a business or other entity other than an
individual person, I have the right, power and authority to execute such
documents on behalf of such entity without the joinder of any other person or
party.
Subject to "The Offer - Section___4. Withdrawal Rights" contained in the Offer
to Purchase, I hereby irrevocably constitute and appoint KRF3 and its designees
as my true and lawful agent and attorneysinfact and proxies with respect to the
Units (and with respect to any and all other Units or other securities issued or
issuable in respect of such Unit on or after the date hereof), each with full
power of substitution (such power of attorney being deemed to be an irrevocable
power coupled with an interest), to (i)___exercise all my voting and other
rights as any such attorneyinfact in their sole discretion may deem proper at
any meeting of Unitholders or any adjournment or postponement thereof, by
written consent in lieu of any such meeting or otherwise; (ii)___act in any
manner as any such attorneyinfact shall, in its sole discretion, deem proper
with respect to the Units; (iii)___deliver the Units and transfer ownership of
the Units on the Partnership's books maintained by the General Partners;
(iv)___endorse, on my behalf, any and all payments received by KRF3 from the
Partnership that are made on or after the Purchase Date, which are made payable
to me, in favor of KRF3 or any other payee KRF3 otherwise designates;
(v)___execute on my behalf any applications for transfer and any distribution
allocation agreements required by National Association of Securities Dealers
Notice to Members 9614 to give effect to the transactions contemplated by this
Agreement; (vi)___receive all benefits and cash distributions after the Purchase
Date; (vii)___otherwise exercise all rights of beneficial ownership of the
Units; and (viii)___direct the General Partners to immediately change the
address of record of the registered owner of the transferred Units to that of
KRF3, as my attorney-infact. KRF3 and its designees are further authorized, as
part of their powers as my attorneysinfact with respect to the Units, to
commence any litigation that KRF3 and its designees, in their sole discretion,
deem necessary to enforce any exercise of KRF3's or such designees powers as my
attorneysinfact as set forth herein. KRF3 or its designees shall not be required
to post bond of any nature in connection with this power of attorney. I hereby
direct the Partnership and the General Partners to remit to KRF3 and its
designees any distributions made by the Partnership with respect to the Units on
or after the Purchase Date. To the extent that any distributions are made by the
Partnership with respect to the Units on or after the Purchase Date, which are
received by me, I agree to promptly pay over such distributions to KRF3. I
further agree to pay any costs incurred by KRF3 and its designees in connection
with the enforcement of any of my obligations hereunder or my breach of any of
the agreements, representations and warranties made by me herein. All prior
powers of attorney and proxies granted by me with respect to the Units (and such
other Units or securities) are, without further action, hereby revoked and no
subsequent powers of attorney or proxies may be given and no subsequent consent
<PAGE>
may be executed (and if given or executed, will not be deemed effective).
By executing and returning the Agreement of Assignment and Transfer, a
Unitholder will be representing that either (a)the Unitholder is not a plan
subject to Title___I of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), or Section___4975 of the Code, or an entity deemed to hold
"plan assets" within the meaning of 29___C.F.R. Section___2510.3___101 of any
such plan; or (b)___the tender and acceptance of Units pursuant to the Offer
will not result in a nonexempt prohibited transaction under Section___406 of
ERISA or Section___4975 of the Code.
I hereby direct the General Partners to immediately change my address of record
as the registered owner of the Units to be transferred herein to that of KRF3 or
its designees, conditional solely upon KRF3's execution of this Agreement.
If legal title to the Units is held through an IRA or KEOGH or similar account,
I understand that this Agreement must be signed by the custodian of such IRA or
KEOGH account. Furthermore, I hereby authorize and direct the custodian of such
IRA or KEOGH to confirm this Agreement.
I hereby represent and warrant to KRF3 that I (i)___have received and reviewed
the Offer to Purchase and (ii)___own the Units and have full power and authority
to validly sell, assign, transfer, convey and deliver to KRF3 and its designees
the Units, and that effective when the Units are accepted for payment by KRF3
and its designees, I hereby convey to KRF3 and its designees, and KRF3 and its
designees will hereby acquire good, marketable and unencumbered title thereto,
free and clear of all options, liens, restrictions, charges, encumbrances,
conditional sales agreements or other obligations relating to the sale or
transfer thereof, and the Units will not be subject to any adverse claim. I
further represent and warrant that I am a "United States person," as defined in
Section___7701(a)(30) of the Internal Revenue Code of 1986, as amended.
I hereby release and discharge the General Partners and its officers, partners,
members, managers, shareholders, directors, employees and agents from all
actions, causes of action, claims or demands I have, or may have, against the
General Partners that result from the General Partners reliance on this
Agreement of Assignment and Transfer or any of the terms and conditions
contained herein. I hereby indemnify and hold harmless KRF3 and the Partnership
from and against all claims, demands, damages, losses, obligations and
responsibilities arising, directly or indirectly, out of a breach of any one or
more representations and warranties set forth herein.
All authority herein conferred or agreed to be conferred shall survive my death
or incapacity and all of my obligations shall be binding upon the heirs,
personal representatives, successors and assigns of the undersigned. In
addition, I hereby agree not to offer, sell or accept any offer to purchase any
or all of the Units to or from any third party while the Offer remains open.
Upon request, I will execute and deliver any additional documents deemed by KRF3
and its designees to be necessary or desirable to complete the assignment,
transfer and purchase of the Units.
I hereby certify, under penalties of perjury, that the statements in Box___A
below are true and correct.
This Agreement shall be governed by and construed in accordance with the laws of
the State of Delaware. I waive any claim that any State or Federal court located
in the State of Delaware is an inconvenient forum, and waive any right to trial
by jury.
<TABLE>
<CAPTION>
SIGN HERE TO TENDER YOUR UNITS
- --------------------------------------------------------------------------------------------------------------
Box A
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Date: 1999 Units to be tendered: All (If you desire to
sell less than all of your units, strike all
and indicate the number of units to be
sold.)
- --------------------------------------------------------------------------------------------------------------
Your Social Security or Taxpayer Your Signature: Signature of Co-Seller(if applicable):
Identification Number:
- --------------------------------------------------------------------------------------------------------------
Please note: A Medallion Guarantee is required by all sellers, it's similar to a
notary, but is provided by your bank or brokerage house where you have your
account.
- --------------------------------------------------------------------------------------------------------------
Box B Medallion Signature Guarantee: (Required by all Sellers)
- --------------------------------------------------------------------------------------------------------------
Name of Bank or Brokerage House:
- --------------------------------------------------------------------------------------------------------------
Authorized Signature of Bank or Brokerage House Representative:
Name: Title: Date: ___________________, 1999
- --------------------------------------------------------------------------------------------------------------
AGREED TO AND ACCEPTED:
KRF3 Acquisition Company, L.L.C.,
By:_____________________________________________
KRF3 Acquisition Company, L.L.C., One Beacon Street Suite 1500, Boston, Massachusetts 02108
Telephone Number: 1 (800) 605 6774, Fax (617) 574-8312
</TABLE>
KRUPP FUNDS GROUP
Dear Investor:
Please review the information provided and make any corrections. Enclosed is a
self- stamped envelope for your convenience.
Current Information Please make any changes below:
Investor ID:
Units
Name: Name: ______________________________
Name 2: Name 2: ______________________________
______________________________
Name 3: Name 3: ______________________________
______________________________
Address 1: Address 1: ______________________________
______________________________
Address 2: Address 2: ______________________________
______________________________
City/State/Zip: City/State/Zip ______________________________
______________________________
Day Time Phone #: Day Time Phone #: ______________________________
______________________________
Evening Phone #: Evening Phone #: ______________________________
______________________________
e-mail Address: e-mail Address: ______________________________
______________________________
Broker Name: Broker Name: ______________________________
______________________________
Brokerage Firm: Brokerage Firm: ______________________________
______________________________
Account Number: Account Number: ______________________________
______________________________
---------------------------------------------------------------------------
Address questions about your account to:
KRUPP Funds Group Or Call:
One Beacon Street, Suite 1500
Boston, Massachusetts 02108 Investor Communications: 1-800-605-6774
<PAGE>
June 11, 1999
Dear Investor:
Due to continued investor interest in the tender offer of KRF3 Acquisition
Company, L.L.C. ("KRF3") for Units of Krupp Realty Fund, Ltd.-III for $550.00
per Unit in cash less distributions made after May 14, 1999, if any, KRF3 is
pleased to announce an extension of the offer, which will expire on June 18,
1999. Enclosed is Supplement No. 2 to the offer to purchase which contains
important information about the tender offer and should be read carefully by
Unitholders.
The highlights pertaining to the offer are listed below:
o KRF3 continues to believe $550 is a fair price.
o You will get prompt payment of the cash consideration for Units - 3 weeks
from the expiration of the offer.
o As part of the extension, we have also decided to purchase any and all
Units tendered with no required minimum, subject to the terms of the offer.
o If you tender, capital invested in the partnership will be available for
other uses.
o If you tender, you will receive your original investment back plus an
additional 18.5% simple return over the 17-year life of the investment.
o You will not incur any commissions or brokerage fees.
This one-week extension affords you the opportunity to weigh the benefits of
this tender and will allow you the time to complete the enclosed paperwork.
If you have any questions or need assistance, please call our representatives at
800- 605-6774 and we will be happy to expedite this process for you.
KRF3 Acquisition Company, L.L.C.
<PAGE>
June 11, 1999
Dear Investor:
Thank you for tendering your Units of Krupp Realty Fund, Ltd.-III. Due to
continued investor interest in the tender, KRF3 Acquisition Company, L.L.C. has
announced an extension, which will expire on June 18, 1999. Subject to the terms
of the offer, we have decided to purchase any and all Units tendered with no
required minimum. Enclosed is Supplement No. 2 to the offer to purchase which
contains important information about the tender offer and should be read
carefully by Unitholders. You can expect to receive the proceeds from your
tender approximately 3 weeks after the expiration of the offer.
Since you have already tendered your Units, this one-week extension requires no
further action by you.
If you have any questions or concerns regarding this information, please do not
hesitate to contact our representatives at 800-605-6774.
KRF3 Acquisition Company, L.L.C.
