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SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[X] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
[_] Definitive Proxy Statement Rule 14a-6(e)(2))
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
WELLS REAL ESTATE FUND III, L.P.
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(Name of Registrant as Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
[X] No Filing Fee Required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] 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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
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_______________________________________________
WELLS REAL ESTATE FUND III, L.P.
3885 HOLCOMB BRIDGE ROAD
NORCROSS, GEORGIA 30092
PROXY STATEMENT
MAY 5, 1997
_______________________________________________
STATEMENT REQUESTING CONSENT TO PROPOSED AMENDMENTS
TO PARTNERSHIP AGREEMENT
This Statement Requesting Consent to Proposed Amendments to Partnership
Agreement is being mailed to Limited Partners of Wells Real Estate Fund III,
L.P. (the "Partnership") on or about May 5, 1997.
This Statement contains information regarding proposed amendments to the
Agreement of Limited Partnership of Wells Real Estate Fund III, L.P. dated July
31, 1988, as amended by the Amendment to Agreement of Limited Partnership of
Wells Real Estate Fund III, L.P. dated July 31, 1988, and as further amended by
the Second Amendment to Agreement of Limited Partnership of Wells Real Estate
Fund III, L.P. dated February 1, 1990 (collectively, the "Partnership
Agreement").
Limited Partners of the Partnership of record as of March 31, 1997, are
entitled to vote on this matter. Unless otherwise defined herein, capitalized
terms used herein shall have the same meaning as in the Partnership Agreement.
Please review the information contained in this Statement, and complete,
sign and return the enclosed consent form by May 31, 1997. In order to be
counted, a properly signed consent form must be received by the General Partners
at 3885 Holcomb Bridge Road, Norcross, Georgia 30092, on or before July 31,
1997, which is the date the consent form will expire unless consents from
Limited Partners owning of record more than 50% of the outstanding Units in the
Partnership have been received prior to such date.
On behalf of the Partnership, the General Partners seek the consent of the
Limited Partners to the proposed amendments to the Partnership Agreement
described herein.
PROPOSED AMENDMENTS TO THE PARTNERSHIP AGREEMENT
EXPLANATION OF PROPOSED AMENDMENTS
The General Partners propose to amend the Partnership Agreement in the
following respects:
(i) To limit the purposes for which a Limited Partner may obtain a copy of
the list of the names, addresses and number of Units owned by the Limited
Partners to purposes reasonably related to a Limited Partner's interest as a
Limited Partner in the Partnership relative to the affairs of the Partnership,
which would prohibit a Limited Partner from obtaining a list
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of the names, addresses and number of Units owned by each of the Limited
Partners for commercial purposes such as making a tender offer to other Limited
Partners or the selling of such list or copies thereof;
(ii) To increase the number of Limited Partners which may require the
General Partners to call a meeting of the Limited Partners from Limited Partners
holding 10% of the outstanding Units to Limited Partners holding both 25% of the
outstanding Units and constituting at least 25% of the total number of Limited
Partners on a per capita basis; and
(iii) To place certain additional restrictions on the admission to the
Partnership as substituted Limited Partners on Assignees of Units in the
Partnership.
The Partnership Agreement currently provides that any Limited Partner or
his duly authorized representative is entitled to a copy of a list of the names,
addresses and number of Units owned by each of the Limited Partners, without any
limitations or restrictions as to the purpose for which such Limited Partner may
have in requesting such list. The General Partners propose to amend the
Partnership Agreement to provide that a Limited Partner would be entitled to a
copy of the list of the names, addresses and number of Units owned by each of
the Limited Partners only for purposes reasonably related to the Limited
Partner's interest as a Limited Partner in the Partnership relative to the
affairs of the Partnership, which would include matters related to the General
Partners' management of the Partnership or its properties and bona fide disputes
with the General Partners, but would exclude commercial purposes such as the
making of a tender offer to other Limited Partners or the selling of such list
or copies thereof.
The General Partners believe that amending the Partnership Agreement to
limit the purposes for which a Limited Partner may request a list of the names,
addresses and number of Units owned by each of the Limited Partners and to
prohibit the requesting of such list for commercial purposes will serve to
protect the confidentiality of such information and prohibit such information
from being used for strictly commercial purposes.
The Partnership Agreement currently provides that the General Partners are
required to call a meeting of the Limited Partners upon the written request of
Limited Partners holding 10% or more of the outstanding Units. The General
Partners propose to amend the Partnership Agreement to increase the threshold of
Limited Partners who would have the right to require the General Partners to
call a meeting of the Limited Partners from Limited Partners holding 10% of the
outstanding Units to both (i) Limited Partners holding 25% or more of the
outstanding Units, and (ii) Limited Partners representing at least 25% of the
total number of Limited Partners on a per capita basis.
The General Partners believe that amending the Partnership Agreement to
increase the threshold of Limited Partners who could require the General
Partners to call a meeting of the Limited Partners will serve to prevent
unnecessary and potentially frivolous Partnership meetings held at the expense
of the Partnership which currently can be called by a small percentage of
Limited Partners who lack the Majority Vote required to take action at a meeting
of the Limited Partners should any such meeting be called.
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The Partnership Agreement currently provides that an Assignee of Units in
the Partnership does not have the right to become a substituted Limited Partner
in the place of his assignor unless (i) the assignment instrument is in form and
substance satisfactory to the General Partners; (ii) the assignor and Assignee
execute such other instruments and writings as the General Partners may deem
necessary or desirable to effectuate such admission; (iii) the Assignee agrees
in writing that he will not, directly or indirectly, create for the Partnership,
or facilitate the trading of Units on, a secondary market (or the substantial
equivalent thereof) within the meaning of Section 7704 of the Code; and (iv) the
Assignee is required to accept, adopt and approve in writing all the terms and
provisions of the Partnership Agreement.
The General Partners propose to amend the Partnership Agreement to add the
following two additional conditions upon the admission of an Assignee of Units
as a substituted Limited Partner: (i) an Assignee would be required to deliver
to the General Partners a legal opinion in such form as the General Partners may
require in their sole discretion, accompanied by appropriate evidence of the
opinions set forth therein, to the effect that the assignment of Units to said
Assignee was conducted strictly in compliance with all applicable state and
federal securities laws and regulations, and (ii) the admission of the Assignee
to the Partnership as a substituted Limited Partner must be approved by the
General Partners in their sole discretion.
In addition, the General Partners propose to amend the Partnership
Agreement to clarify that Assignees who are not admitted to the Partnership as
substituted Limited Partners will be entitled to receive distributions and
allocations from the Partnership attributable to the Units assigned but will
have no right to vote on matters submitted to the Limited Partners for a vote or
other rights as a Limited Partner under the terms of the Partnership Agreement
unless such Assignee is first formally admitted to the Partnership as a
substituted Limited Partner.
The General Partners believe that amending the Partnership Agreement to
require Assignees of Units to deliver a legal opinion confirming securities law
compliance and to grant to the General Partners additional discretion to approve
of the admission of Assignees of Units to the Partnership as substituted Limited
Partners will serve to better ensure securities law compliance in connection
with transfers of Units and avoid potentially adverse tax consequences to the
Partnership and the Limited Partners which may otherwise result from transfers
of Units.
TEXT OF PROPOSED AMENDMENTS TO THE PARTNERSHIP AGREEMENT
The General Partners propose to amend Section 15.1 of the Partnership
Agreement by deleting said Section 15.1 in its entirety and substituting a new
Section 15.1 in lieu thereof, to read as follows:
"15.1 BOOKS. The General Partners shall maintain full and complete
books and records for the Partnership at its principal office, and all
Limited Partners and their designated representatives shall have the right
to inspect, examine and copy at their reasonable cost such books at
reasonable times. The books of account for financial accounting purposes
shall be kept in accordance
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with generally accepted accounting principles. The books of account for
income tax purposes shall be kept on a cash or an accrual basis, as
determined in the discretion of the General Partners. Subject to such
reasonable procedural standards as may be established by the General
Partners from time to time, a Limited Partner or his duly authorized
representative, upon paying the costs of duplicating and mailing, shall be
entitled to a copy of a list of the names, addresses and number of Units
owned by each of the Limited Partners for any purpose reasonably related to
the Limited Partner's interest as a Limited Partner relative to the affairs
of the Partnership. Purposes which shall be deemed to be included as
reasonably related to the Limited Partner's interest as a Limited Partner
relative to the affairs of the Partnership shall include matters relating
to the General Partners' management of the Partnership or its properties
and bona fide disputes with the General Partners, but shall not include
commercial purposes such as the making of a tender offer to Limited
Partners in the Partnership or the selling of such list or copies thereof."
The General Partners propose to amend Section 16.4(a) of the Partnership
Agreement by deleting said Section 16.4(a) in its entirety and substituting a
new Section 16.4(a) in lieu thereof, to read as follows:
"(a) Meetings of the Limited Partners to vote upon any matters as to
which the Limited Partners are authorized to take action under this
Agreement may be called at any time by any of the General Partners and
shall be called by the General Partners upon the written request of both
(i) Limited Partners holding 25% or more of the outstanding Units, and
(ii) Limited Partners representing 25% or more of the total number of
Limited Partners on a per capita basis, by delivering written notice within
ten days after receipt of such written request, either in person or by
registered mail, to the Limited Partners entitled to vote at such meeting
to the effect that a meeting will be held at a reasonable time and place
convenient to the Limited Partners and which is not less than 15 days nor
more than 60 days after the receipt of such request; provided, however,
that such maximum periods for the giving of notice and the holding of
meetings may be extended for an additional 60 days if such extension is
necessary to obtain qualification or clearance under any applicable
securities laws of the matters to be acted upon at such meeting or
clearance by the appropriate governing agency of the solicitation materials
to be forwarded to the Limited Partners in connection with such meeting.
The General Partners agree to use their best efforts to obtain such
qualifications and clearances. Included with the notice of a meeting shall
be a detailed statement of the action proposed, including a verbatim
statement of the wording on any resolution proposed for adoption by the
Limited Partners and of any proposed amendment to this Agreement. All
expenses of the meeting and notification shall be borne by the
Partnership."
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The General Partners propose to amend Sections 17.5 and 17.6 of the
Partnership Agreement by deleting said Sections 17.5 and 17.6 in their entirety
and substituting new Sections 17.5 and 17.6 in lieu thereof, to read as follows:
"17.5 SUBSTITUTED LIMITED PARTNERS. Except as otherwise provided in
this Agreement, an Assignee of all or any portion of a Limited Partner's
interest in the Partnership shall not have the right to become a
substituted Limited Partner in place of his assignor unless (a) the
assignment instrument shall have been in form and substance satisfactory to
the General Partners; (b) the assignor and Assignee named therein shall
have executed and acknowledged such other instrument or instruments as the
General Partners may deem necessary or desirable to effectuate such
admission, including but not limited to, a power of attorney with
provisions more fully described in this Agreement; (c) the Assignee shall
agree in writing that he will not, directly or indirectly, create for the
Partnership, or facilitate the trading of such interest on, a secondary
market (or the substantial equivalent thereof) within the meaning of
Section 7704 of the Code; (d) the Assignee shall have delivered to the
General Partners a legal opinion in form and substance satisfactory to the
General Partners, in their sole discretion, accompanied by appropriate
evidence of the opinions set forth therein, to the effect that the
assignment of Units to said Assignee was conducted strictly in compliance
with all applicable state and federal securities laws and regulations,
including without limitation, state and federal securities registration
requirements, disclosure requirements and takeover disclosure requirements;
(e) the admission of the Assignee to the Partnership as a substituted
Limited Partner shall have been approved by the General Partners in their
sole discretion; and (f) the Assignee shall have accepted, adopted and
approved in writing all of the terms and provisions of this Agreement, as
the same may have been amended. In the event that an Assignee of Units so
qualifies to be admitted to the Partnership as a substituted Limited
Partner, such Assignee will be recognized by the Partnership as substituted
Limited Partner as of the commencement of the first fiscal quarter of the
Partnership following the fiscal quarter which includes the effective date
of the assignment and in which the foregoing conditions are satisfied,
notwithstanding the time consumed in preparing and filing the necessary
documents with governmental agencies necessary to effectuate the
substitution.
17.6 ASSIGNMENT OF LIMITED PARTNERSHIP INTEREST WITHOUT SUBSTITUTION.
Subject to the transfer restrictions of Section 17.3, a Limited Partner
shall have the right to assign all or part of such Limited Partner's
economic interest in Units by a written instrument of assignment; provided,
however, the Assignee of such Limited Partner's economic interest in Units
shall have no right to be admitted to the Partnership as a substituted
Limited Partner except in accordance with the provisions of Section 17.5
above. The assigning Limited Partner shall deliver to the General Partners
a written instrument of assignment in form and substance satisfactory to
the General Partners, duly executed by the assigning Limited Partner or his
personal representative or authorized agent, including an executed
acceptance by the Assignee of all the terms and provisions of this
Agreement and the representations of the assignor
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and Assignee that the assignment was made in accordance with all applicable
laws and regulations (including investment suitability requirements). Said
assignment shall be accompanied by such assurance of genuineness and
effectiveness and by such consents or authorizations of any governmental or
other authorities as may be reasonably required by the General Partners.
An Assignee shall be entitled to receive distributions and allocations from
the Partnership attributable to the Partnership interest acquired by reason
of any such assignment from and after the first day of the fiscal quarter
following the fiscal quarter in which the assignment of such interest takes
place; provided, however, that such Assignee shall have no right to vote on
matters submitted to the Limited Partners for a vote or other rights as a
Limited Partner under the terms of this Agreement unless such Assignee is
first formally admitted to the Partnership as a substituted Limited Partner
in accordance with the provisions of Section 17.5 above. The Partnership
and the General Partners shall be entitled to treat the assignor of such
Partnership interest as the absolute owner thereof in all respects, and
shall incur no liability for distributions made in good faith to such
assignor, until such time as the written instrument of assignment has been
received by the Partnership and recorded on its books."
EFFECT OF APPROVAL OF THE PROPOSED AMENDMENTS TO THE PARTNERSHIP AGREEMENT
In the event that the proposed amendments to the Partnership Agreement are
approved by holders of a majority of the outstanding Units, (i) Limited Partners
will be restricted from obtaining a list of the names, addresses and number of
Units held by each of the Limited Partners for commercial purposes; (ii) the
threshold number of Limited Partners who will be able to require the General
Partners to call a meeting of the Limited Partners will be increased from
Limited Partners holding 10% of the outstanding Units to Limited Partners
holding both 25% of the outstanding Units and constituting at least 25% of the
total number of Limited Partners on a per capita basis; and (iii) additional
restrictions will be placed upon the right of Assignees of Units in the
Partnership to become admitted to the Partnership as substituted Limited
Partners.
EFFECT OF NONAPPROVAL OF THE PROPOSED AMENDMENTS TO THE PARTNERSHIP AGREEMENT
If the General Partners do not receive the requisite number of consents
from the Limited Partners to approve the proposed amendments to the Partnership
Agreement, the Partnership Agreement would not be amended as proposed hereby, in
which event any Limited Partner would continue to have a stated right under the
Partnership Agreement to obtain a copy of the list of the names, addresses and
number of Units owned by the Limited Partners without regard for the purpose for
which such Limited Partner may have had for requesting such list, and Limited
Partners owning only 10% of the outstanding Units would continue to have the
right under the Partnership Agreement to call a meeting of the Limited Partners.
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RECOMMENDATION OF THE GENERAL PARTNERS WITH RESPECT TO THE PROPOSED AMENDMENTS
TO THE PARTNERSHIP AGREEMENT
The General Partners recommend that the Limited Partners consent to and
approve the proposed amendments to the Partnership Agreement. The General
Partners have proposed these amendments to the Partnership Agreement as a result
of their knowledge of a specific effort to obtain a list of the names, addresses
and number of Units owned by each of the Limited Partners to be used for
commercial purposes. There is no present intent on the part of the General
Partners at this time to propose further amendments to the Partnership Agreement
in future proxy solicitations.
REQUIRED APPROVAL OF LIMITED PARTNERS
Pursuant to the provisions of Section 22.3 of the Partnership Agreement,
the Partnership Agreement may be amended with the affirmative vote or written
consent of Limited Partners owning of record more than 50% of the then
outstanding Units in the Partnership. Accordingly, the consent of holders of at
least 11,090,253 of the 22,180,505 outstanding Units in the Partnership of
record as of March 31, 1997 are required to authorize and approve the amendments
to the Partnership Agreement proposed hereby.
May 5, 1997
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[ FORM OF PROXY ]
[ FRONT ]
CONSENT TO AMENDMENTS TO PARTNERSHIP AGREEMENT OF
WELLS REAL ESTATE FUND III, L.P.
PLEASE COMPLETE AND RETURN BY MAY 31, 1997
THE UNDERSIGNED LIMITED PARTNER OF WELLS REAL ESTATE FUND III, L.P. (THE
"PARTNERSHIP"), HAVING RECEIVED THE STATEMENT REQUESTING CONSENT TO PROPOSED
AMENDMENTS TO PARTNERSHIP AGREEMENT DATED MAY 5, 1997 (THE "STATEMENT") RELATING
TO THE PROPOSED AMENDMENTS TO THE PARTNERSHIP AGREEMENT OF THE PARTNERSHIP AS
DESCRIBED THEREIN (THE "PROPOSED AMENDMENTS"), DOES HEREBY VOTE ALL UNITS HELD
OF RECORD BY THE UNDERSIGNED LIMITED PARTNER AS FOLLOWS:
ADOPTION OF THE PROPOSED AMENDMENTS TO SECTIONS 15.1, 16.4, 17.5 AND 17.6
OF THE PARTNERSHIP AGREEMENT OF WELLS REAL ESTATE FUND III, L.P., AS
SPECIFIED IN THE STATEMENT.
[ ] FOR THE [ ] AGAINST THE [ ] ABSTAIN FROM VOTING
PROPOSED AMENDMENTS PROPOSED AMENDMENTS ON THE PROPOSED AMENDMENTS
THIS CONSENT, WHEN PROPERLY SIGNED, WILL BE VOTED IN THE MANNER INDICATED ABOVE.
IF THIS CONSENT IS PROPERLY SIGNED AND RETURNED, BUT NO BOX IS CHECKED, IT WILL
BE VOTED "FOR" THE PROPOSED AMENDMENTS. THIS CONSENT SHALL EXPIRE ON JULY 31,
1997, UNLESS CONSENTS REPRESENTING A SUFFICIENT VOTE OF UNITS TO ADOPT THE
PROPOSED AMENDMENTS HAVE BEEN RECEIVED BY THAT DATE. THIS CONSENT MUST BE
SIGNED AND DATED.
___________________________________________________
SIGNATURE* DATE (CAPACITY, IF APPLICABLE)
___________________________________________________
SIGNATURE* DATE (CAPACITY, IF APPLICABLE)
* (PLEASE SIGN EXACTLY AS YOUR NAME APPEARS ON THE
ADDRESS LABEL. JOINT OWNERS SHOULD EACH SIGN.
TRUSTEES AND OTHERS ACTING IN A REPRESENTATIVE
CAPACITY SHOULD INDICATE THE CAPACITY IN WHICH THEY
SIGN. BENEFICIARIES OF IRAS SHOULD SIGN IN THEIR
INDIVIDUAL CAPACITIES.)
THIS PROXY IS SOLICITED BY THE GENERAL PARTNERS OF
WELLS REAL ESTATE FUND III, L.P.
PLEASE MARK, DATE AND SIGN THE CONSENT AND RETURN TO WELLS CAPITAL, INC.
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[ FORM OF PROXY ]
[ BACK ]
WELLS CAPITAL, INC.
P.O. BOX 926040
NORCROSS, GEORGIA 30092-9209
