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SUPPLEMENT TO
OFFER TO PURCHASE FOR CASH
AIMCO
AIMCO Properties, L.P.
is offering to purchase any and all units of limited partnership interests in
CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES/3
FOR $106.00 PER UNIT IN CASH
Upon the terms and subject to the conditions set forth herein, we will accept
any and all units validly tendered in response to our offer. If units are
validly tendered and not properly withdrawn prior to the expiration date and
the purchase of all such units would result in there being less than 320
unitholders, we will purchase only 99% of the total number of units so tendered
by each limited partner.
Our offer price will be reduced for any distributions subsequently made by your
partnership prior to the expiration of our offer.
Our offer and your withdrawal rights will expire at 5:00 P.M., New York City
time, on September 15, 2000, unless we extend the deadline.
We will pay the fee, up to $50, charged by a custodian of an IRA for tendering
units. You will pay any other fees and costs, including any transfer taxes.
Our offer is not subject to a minimum number of units being tendered.
SEE "RISK FACTORS" IN THE OFFER TO PURCHASE, DATED JULY 24, 2000, FOR
A DESCRIPTION OF RISK FACTORS THAT YOU SHOULD CONSIDER IN CONNECTION WITH OUR
OFFER, INCLUDING THE FOLLOWING:
We determined the offer price of $106.00 per unit without any
arms-length negotiations. Accordingly, our offer price may
not reflect the fair market value of your units.
In November 1999, we offered to buy your units for $116.60
per unit. Since November 1999, your partnership has paid
distributions of $25.00 per unit from operations.
In November 1999, an independent investment banking firm
estimated that the net asset value, going concern value and
liquidation value of your partnership were $137.00, $130.00,
and $133.00 per unit, respectively.
(continued on next page)
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If you desire to accept our offer, you should complete and sign the
enclosed letter of transmittal in accordance with the instructions thereto and
mail or deliver the signed letter of transmittal and any other required
documents to River Oaks Partnership Services, Inc., which is acting as
Information Agent in connection with our offer, at one of its addresses set
forth on the back cover of this Supplement. QUESTIONS AND REQUESTS FOR
ASSISTANCE OR FOR ADDITIONAL COPIES OF THE OFFER TO PURCHASE, THIS SUPPLEMENT
OR THE LETTER OF TRANSMITTAL MAY ALSO BE DIRECTED TO THE INFORMATION AGENT AT
(888) 349-2005.
September 1, 2000
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(Continued from prior page)
As of June 30, 1998, your general partner (which is our subsidiary)
estimated the net asset value of your units to be $158.00 per unit and
an affiliate of your general partner estimated the net liquidation
value of your units to be $156.61 per unit. In 1999, your partnership
sold two properties for $10,402,591 in net proceeds, of which
$2,643,365 was used to pay indebtedness and $5,888,162 was distributed
to the partners.
We are making this offer with a view to making a profit and therefore,
there is a conflict between our desire to purchase your units at a low
price and your desire to sell your units at a high price.
Although your partnership's agreement of limited partnership provides
for termination in the year 2015, the prospectus pursuant to which the
units were sold in 1986 indicated that the properties owned by your
partnership might be sold within a period less than 12 years of their
acquisition if conditions permitted.
Your general partner and the property manager of the properties are
subsidiaries of ours and, therefore, the general partner has
substantial conflicts of interest with respect to our offer.
Continuation of your partnership will result in our affiliates
continuing to receive management fees from your partnership. Such fees
would not be payable if your partnership was liquidated.
It is possible that we may conduct a future offer at a higher price.
For any units that we acquire from you, you will not receive any
future distributions from operating cash flow of your partnership or
upon a sale or refinancing of property owned by your partnership.
If we acquire a substantial number of units, we will increase our
ability to influence voting decisions with respect to your partnership
and may control such voting decisions, including but not limited to
the removal of the general partner, most amendments to the partnership
agreement and the sale of all or substantially all of your
partnership's assets.
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INTRODUCTION
On July 24, 2000, we commenced an offer to acquire all of the
outstanding units of your partnership, in exchange for $106.00 in cash per
unit, net to the seller, without interest, less the amount of distributions, if
any, made by your partnership in respect of any unit from July 24, 2000 until
the expiration date. If units are validly tendered and not properly withdrawn
prior to the expiration date and the purchase of all such units would result in
there being less than 320 unitholders, we will purchase only 99% of the total
number of units so tendered by each limited partner. Our offer is made upon the
terms and subject to the conditions set forth in the Offer to Purchase, dated
July 24, 2000, our prior Supplement, this Supplement and in the accompanying
letter of transmittal.
Our offer terminates at 5:00 p.m., New York City time, on September
15, 2000. If you desire to accept our offer, you must complete and sign the
letter of transmittal in accordance with the instructions contained therein,
and forward or hand deliver the enclosed acknowledgment and agreement, together
with any other required documents, to the Information Agent. If you have
already tendered your units in accordance with the original letter of
transmittal, you need not take any further action to continue to tender your
units. You may withdraw your tender of units pursuant to the offer at any time
prior to the expiration date of our offer and, if we have not accepted such
units for payment, on or after September 22, 2000.
We expressly reserve the right, in our reasonable discretion, at any
time and from time to time, to extend the period of time during which our offer
is open and thereby delay acceptance for payment of, and the payment for, any
unit. Notice of any such extension will promptly be disseminated to you in a
manner reasonably designed to inform you of such change. Further, any extension
may be followed by a press release or public announcement which will be issued
no later than 9:00 a.m., New York City time, on the next business day after the
scheduled expiration date of our offer, in accordance with Rule 14e-1(d) under
the Securities Exchange Act of 1934.
Our Offer to Purchase, dated July 24, 2000, is hereby further
supplemented as follows:
1. Since May 1, 2000, we have purchased in privately negotiated
transactions following units in your partnership:
<TABLE>
<CAPTION>
DATE NUMBER OF UNITS PURCHASED PURCHASE PRICE PER UNIT
---- ------------------------- -----------------------
<S> <C> <C>
May 1 177.40 (1)
June 1 265.70 (2)
July 1 4 $105.00
</TABLE>
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(1) Purchase prices are as follows: 147.40 units were purchased for
$116.60 per unit; 26 units were purchased as part of a group purchase
of 10,700.45 units in various partnerships for an aggregate price of
$1,431,361.20; and 4 units were purchased as part of a group purchase
of 2,485.25 units in various partnerships for an aggregate price of
$489,818.
(2) Purchase prices are as follows: 198.70 units were purchased for
$116.60 per unit; and 67 units were purchased as part of a group
purchase of 883.50 units in various partnerships for an aggregate
price of $357,999.76.
2. The current executive officers of the general partner of your
partnership are the same as the executive officers of AIMCO.
3. Your general partner intends to seek approval of limited partners
to amend your partnership agreement to eliminate the current partnership
mandatory minimum set reserve requirement of approximately $2.6 million. Your
partnership currently has reserves of $5.5 million. Approval of this amendment
is likely based on the number of units held by us and our affiliates. After
adoption of the amendment, the general partner will be able to reduce the
necessary reserves and, as a result, it is expected that your partnership will
make a distribution to its partners in an aggregate amount equal to the
reduction in the reserves.
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The letter of transmittal and any other required documents should be
sent or delivered by each unitholder or such unitholder's broker, dealer, bank,
trust company or other nominee to the Information Agent at one of its addresses
set forth below.
THE INFORMATION AGENT FOR THE OFFER IS:
RIVER OAKS PARTNERSHIP SERVICES, INC.
<TABLE>
<S> <C> <C>
By Mail: By Overnight Courier: By Hand:
P.O. Box 2065 111 Commerce Road 111 Commerce Road
S. Hackensack, N.J. 07606-2065 Carlstadt, N.J. 07072 Carlstadt, N.J. 07072
Attn.: Reorganization Dept. Attn.: Reorganization Dept.
</TABLE>
For information, please call:
TOLL FREE: (888) 349-2005
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