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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of
1934
[X] Filed by the Registrant
[_] Filed by a Party other than the Registrant
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] Definitive Proxy Statement
[X] Definitive Additional Materials
[_] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
[_] Confidential, for use of the Commission only (as permitted by Rule
14a-6(e)(2)
CAPITAL REALTY INVESTORS TAX EXEMPT FUND LIMITED PARTNERSHIP
("CRITEF")
CAPITAL REALTY INVESTORS TAX EXEMPT FUND III LIMITED PARTNERSHIP
("CRITEF III")
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(NAMES OF REGISTRANTS AS SPECIFIED IN THEIR CHARTERS)
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(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
[_] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2), or
Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule 14a-
6(i)(3).
[X] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
Beneficial Assignee Certificates ("BACs"), CRITEF, Series I & II
Beneficial Assignee Certificates ("BACs"), CRITEF III
2) Aggregate number of securities to which transaction applies:
2,280,000 BACs in CRITEF, Series I 3,238,760 BACs in CRITEF, Series II
5,258,268 BACs in CRITEF III
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
$15.00 per BAC in CRITEF, Series I $14.68 per BAC in CRITEF, Series II
$15.32 per BAC in CRITEF III
4) Proposed maximum aggregate value of transaction: $162,301,663
5) Total fee paid: $32,461
[_] Fee paid previously with preliminary materials.
[X] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
1) Amount previously paid: $32,461
2) Form, Schedule or Registration Statement No.: Schedule 14A
3) Filing parties: CRITEF and CRITEF III
4) Date filed: March 18, 1996; August 26, 1996
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EXHIBIT 17(d)(6)
FOR: CAPREIT
CONTACT: Richard L. Kadish
(301) 231-8700
KCSA CONTACT: Leslie A. Schupak
(212) 682-6565 ext. 207
Fax: (212) 338-9558
E-Mail: [email protected]
FOR IMMEDIATE RELEASE
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CAPREIT ACCUSES DOMINIUM OF ATTEMPTING TO
SABOTAGE MERGER
ROCKVILLE, MD --October 14, 1996 -- Capital Apartments Properties, Inc.
(CAPREIT) Presidential Richard L. Kadish has called attempts by Dominium Tax
Exempt Fund LLP to impede a proposed merger between CRITEF partnerships and
affiliates of CAPREIT "malicious, egregious, and in furtherance of their 'green
mail' solicitations."
Kadish stated: "After Dominium tried and failed for seven months to
produce a better cash offer than CAPREIT's, Dominium proposed to CAPREIT that it
enter into a management contract which would have given Dominium $3.5 million in
termination fees upon approval of the merger of the Funds. I believe their
attempt to impede the merger is a continuation of their effort to obtain green
mail."
Kadish further pointed out that Dominium holds only 100 shares each of
CRITEF I, II and III which were only purchased within the last few weeks. "We
can only speculate that Dominium may seek to profit by a fall in the BAC prices
should the merger fail.
"By marked contrast," the CAPREIT President said, "Our offers, each of
which provides a premium to the BAC holders, has been reviewed and approved by
the Delaware Chancery Court. In addition, the price being offered to each BAC
Holder has the support of a
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Fairness Opinion from a nationally recognized investment banking firm with
extensive experience in real estate valuations."
CAPREIT's price offer constitutes a 27 percent premium to the market
price the day CAPREIT made its bid, according to Kadish. He pointed out that
the CRITEF proxy underwent an extensive review by the Securities and Exchange
Commission to ensure that all relevant facts were stated and explained.
"CAPREIT's offer has been made fairly and with the belief that BAC
Holders will receive significantly more value from the mergers than they would
be able to obtain by selling their BAC's in the public marketplace at the prices
that prevailed immediately prior to the initial announcement of the mergers.
This has been substantiated by the fact there has been no higher firm bids from
other nationally recognized real estate firms," Kadish said.
CAPREIT owns, develops and manages multifamily garden-style and
townhome communities throughout the Midwest, Mid-Atlanic, Northeast and
Southeast United States. CAPREIT currently owns and manages 30 properties with
8,942 housing units. CAPREIT also manages an additional 39 apartment
communities on behalf of third-party owners.
* * *
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EXHIBIT 17(d)(7)
FOR: CAPREIT
CONTACT: Richard L. Kadish
(301) 231-8700
KCSA CONTACT: Leslie A. Schupak
Phone: (212) 682-6565 ext. 207
Fax: (212) 338-9558
E-Mail: [email protected]
FOR IMMEDIATE RELEASE
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COURT CONFIRMS NO PRESENT BID FROM DOMINIUM ROCKVILLE, MD -- October
16, 1996 -- The Federal Judge for the Southern District of New York found that
Dominium's Tax Exempt Fund LPL's correspondence to BAC Holders of CRITEF I, II
and III Funds, may have contained numerous inaccuracies.
While denying CRITEF's request for extraordinary relief, the Court
indicated that it would entertain a renewal of that request for injunctive
relief unless Dominion made corrective disclosures which must be disseminated to
BAC Holders on or before October 21.
The Court in its opinion further indicated that "a competing bid by
Dominium is not now in the offing."
It further found that Dominium was "seeking to delay or defeat the
proposed mergers in the hope that it somehow would obtain the wherewithal to
acquire control or that it would make such a nuisance of itself that CARPEIT or
the Funds would pay it to go away."
In making this observation, the court noted: "Dominium has no
meaningful ownership interest in the Funds."
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In reviewing the Court's opinion, Richard L. Kadish, President of
CAPREIT, which has made an offer at a minimum 27 percent premium to the market
price the day it made its bid, stated: "The Court essentially confirmed what we
have been saying all along -- Dominium has no proposal,, has no significant
economic interest in the Funds and that its plan of harassment is strictly to
create some unique benefit for itself.:
CAPREIT owns, develops and manages multifamily, garden-style and
townhome communities throughout the Midwest, Mid-Atlantic, Northeast and
Southeast United States. CAPREIT currently owns and manages 30 properties with
8,942 housing units. CAPREIT also manages an additional 39 apartment
communities on behalf of third-party owners.
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CAPITAL REALTY INVESTORS TAX EXEMPT FUND LIMITED PARTNERSHIP,
SERIES I & SERIES II
CAPITAL REALTY INVESTORS TAX EXEMPT FUND III LIMITED PARTNERSHIP
c/o C.R.I., Inc.
11200 Rockville Pike
Rockville, Maryland 20852
IT'S NOW TIME TO VOTE
October 17, 1996
Dear BAC Holder:
If you are unsure about Dominium's true intentions in trying to block the
proposed CAPREIT-CRITEF mergers -- or about how to vote your proxy -- here are
several items that will help clear up any doubts:
. The United States District Court for the Southern District of New
York stated: "There is little doubt that Dominium is seeking to
delay or defeat the proposed mergers in the hope it will somehow
obtain the wherewithal to acquire control of the Funds or that it
will make such a nuisance of itself that CAPREIT or the Funds will
pay it to go away."
. Dominium's own Definitive Proxy Statement, however, confirms:
"Dominium is not presently pursuing financing, nor does it have any
present plans to make a superior proposal."
. Although the Federal Court denied our injunction motion, it
nevertheless found that Dominium's earlier communications to BAC
Holders:
...may have created the impression in some minds that Dominium's
interest was as a fellow investor. Yet Dominium has no
meaningful ownership interest....In these circumstances, the
failure to disclose its own interest in an acquisition and its
failure to finance a proposal at a price only marginally higher
than one it now characterizes as 'grossly inadequate' arguably
was materially misleading.
. The Court emphasized the absence of a superior proposal from
Dominium, or anyone else, in stating, "As the merger train comes
closer and closer to departure without the emergence of the hoped-
for better mode of transportation, more and more BAC holders will
hop aboard rather than be left at the station."
Other investors with a greater economic stake in the Funds than Dominium
demonstrate that they accept CAPREIT's now time-tested offer. The CRITEF Funds
have learned that an independent investment advisor, 2nd Market Capital Advisory
Corporation,
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BAC Holders
October 17, 1996
Page Two
controls 3% of each CRITEF Fund and has submitted all its proxies voting for the
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proposed mergers. A letter to 2nd Market's clients states: "In light of the
free-flow of financial information and the assertive acquisitions and mergers
environment today, we can feel comfortable in believing sufficient time has
passed for the emergence of a superior third party offer. CAPREIT's offer
resembles our value expectations..."
The CRITEF General Partners continue to recommend that you approve the
proposed mergers for the reasons set forth in the proxy statement, including:
. For eight months, attorneys representing the BAC Holders in a
class action suit sought higher bids for the CRITEF Funds,
including a bid from Dominium, but received no firm offers.
. CAPREIT's merger redemption prices are supported by fairness
opinions from a nationally recognized investment banking firm.
. The redemption prices represent substantial premiums ranging
from 26% to 33% over the AMEX trading prices as of the date of
CAPREIT's initial bid.
Dominium offers you NO ALTERNATIVE PROPOSAL. It has NO MEANINGFUL
INVESTMENT IN THE FUNDS. It simply wants to disrupt the mergers to keep the
Partnership's properties "available." But for whose benefit -- yours or theirs?
The General Partners urge you to sign and return the enclosed white
proxy card.
In you have any questions, please contact MacKenzie Partners, our
information and proxy agent, at 1-800-322-2885.
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Very truly yours,
CRITEF ASSOCIATES LIMITED PARTNERSHIP and
CRITEF III ASSOCIATES LIMITED PARTNERSHIP,
General Partners
By: C.R.I., Inc., their general partner
/s/ William B. Dockser /s/ H. William Willoughby
William B. Dockser H. William Willoughby
Chairman of the Board President
