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SCHEDULE 14A
Information Required in Proxy Statement
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No. )
[X ] Filed by the Registrant
[ ] Filed by a Party other than the Registrant
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, For Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[X ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to SS240.14a-11(c) or
SS240.14a-12
BRAUVIN INCOME PLUS L.P. III
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1),
14a-6(i)(2) of 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:
Units of Limited Partnership Interests
2) Aggregate number of securities to which transactions
applies:
2,230,375 Units of Limited Partnership Interests
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
Based upon the aggregate cash to be paid for the
Registrant's assets ($19,129,150) which are the subject
of this Schedule 14A, the Registrant is paying a filing
fee of $3,825.83 (one-fiftieth of one percent of this
aggregate of the cash and the value of securities
(other than its own) and other property to be received
by the Registrant in the subject transaction.)
4) Proposed maximum aggregate value of transaction:
$19,129,150
5) Total fee paid:
$3,825.83
[X ] 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 offering 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:
$3,825.83
2) Form Schedule or Registration Statement No.:
Schedule 14A
3) Filing Party:
Brauvin Income Plus L.P. III
4) Date Filed:
July 19, 1996
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October 4, 1996
Dear Limited Partner, Brauvin Income Plus L.P. III:
By now you may have received a letter from The Mills Firm,
requesting that you revoke your prior vote to approve the merger of
the Partnership with Brauvin Real Estate Funds L.L.C. (the
"Purchaser"). This letter from The Mills Firm contains numerous
misstatements and material omissions designed to convince you to
change your vote without full and fair disclosure. They make a
number of inflammatory and unsubstantiated allegations, yet they
offer no proof. We ask that you take no action with respect to
their request until you fully understand all the facts. We would
also like you to be aware that The Mills Firm attempted to
permanently enjoin (or stop) the Special Meeting of the
Partnership, now scheduled for October 9, 1996. The Mills Firm has
thus attempted to prohibit your vote from being cast on the
Transaction. Fortunately, the judge in the U.S. District Court
denied The Mills Firm request and the Special Meeting will proceed.
The following points address the specific allegations set forth in
the letter from The Mills Firm. If you still have questions or
concerns after you read the following, please call us directly at
(800) 272-8846. We are happy to take the time to discuss your
concerns with you personally.
1. Valuation of the Assets; Fairness Opinion. Cushman &
Wakefield of Illinois, Inc. was engaged by the Partnership in
March, 1996 in connection with the Partnership's annual valuation
of its assets. Several months later, Cushman & Wakefield was
retained to provide an opinion as to whether or not the Transaction
with the Purchaser was fair to you, the Limited Partners, from a
financial point of view. Cushman & Wakefield is part of a national
network of affiliated full-service real estate companies providing
brokerage, management, consulting and valuation services in the
United States. Cushman & Wakefield was retained specifically
because of their independence and the excellent reputation they
enjoy in the real estate finance community.
As described in the Proxy Statement, Cushman & Wakefield's
valuation of the assets was based primarily on a discounted cash
flow analysis which is in conformance with the established and
accepted procedures of the Appraisal Institute regarding properties
of this type. A thorough discussion of the steps taken by Cushman
& Wakefield in the valuation process is set forth in the section of
the Proxy Statement entitled "Special Factors - Valuation of the
Assets; Fairness Opinion."
Cushman & Wakefield has rendered an opinion that the Transaction is
fair to you from a financial point of view. This opinion and the
agreements pursuant to which Cushman & Wakefield was retained,
including the indemnification of Cushman & Wakefield, are standard
for transactions in the financial marketplace, although The Mills
Firm would like you to believe otherwise. We ask that you not be
swayed by The Mills Firm's lack of understanding of the established
and accepted industry procedures undertaken by Cushman & Wakefield.
2. Ownership of the Purchaser. As described in the Proxy
Statement under the heading "Certain Information Concerning the
Purchaser," the Purchaser is currently owned 1% by a corporation
and 99% by Brauvin Net Realty, L.L.C. As of today, Mr. Jerome J.
Brault is the 100% owner of Brauvin Net Realty, L.L.C. However,
the collective ownership of Mr. Brault and his affiliates in the
Purchaser will be limited to no more than 20% and may be as low as
0%. These amounts will be finalized as the Purchaser completes its
equity and debt financing. Again, The Mills Firm is asking you to
only focus on a portion of the disclosure in the Proxy Statement.
It is this type of flagrant misrepresentation that has caused a
delay in the holding of the Special Meeting and increased costs for
the Partnership. Should these delays continue, there is a
likelihood that the equity and debt financing required by the
Purchaser will not be obtained and, therefore, the Purchaser will
be unable to acquire the assets and the proposed Transaction will
not be consummated.
3. Dissenter's Rights. As described in the Proxy Statement
under the heading "Special Factors - Appraisal Rights," neither the
Partnership's limited partnership agreement nor the Delaware
Revised Uniform Limited Partnership Act provides rights for
appraisal or similar rights to the Limited Partners who dissent
from the vote of the majority in approving the Transaction. The
fact that such appraisal rights have never been available within
the Partnership does not mean that the Operating General Partners
were attempting to avoid a truly independent appraisal process. In
fact, the Operating General Partners retained Cushman & Wakefield
to render a fairness opinion to confirm that the price being
offered by the Purchaser was indeed a fair price.
4. Sale of Affiliated Entity. Although the Partnership's limited
partnership agreement provides that the Partnership may not sell
its assets to affiliated entities, the limited partnership
agreement may be amended with the approval of Limited Partners
owning a majority of the Units. The Mills Firm wants you to
believe that this right is not available to you. However, all
decisions regarding this Transaction rest with you as a Limited
Partner of the Partnership.
5. Why Sell Now? We are pleased with the results of your
Partnership to date and believe that much of the credit relates to
the dedication our organization has shown in connection with the
acquisition and subsequent management of the various properties
owned by the Partnership. However, there can be no assurance that
these returns will continue into the future. As stated in the
Proxy Statement, the longer the properties are held by the
Partnership, the greater the risk related to lease rollover,
renegotiation and non-renewal. Should the Partnership wait until
such risks come to fruition, the properties may then be more
difficult to sell. Essentially, there is no way to determine when
value has been maximized. Because the Operating General Partners
have determined that the terms of the Transaction are fair to the
Limited Partners they have recommended the Transaction.
Consummation of the Transaction will allow you to liquidate, on an
all cash basis, your illiquid investment in the Units, which cash
can then be invested in alternative investments.
6. Who Should Be Responsible for the Ultimate Decision Regarding
the Sale of the Assets? The Mills Firm believes that the
properties should not be sold to the Purchaser due to the fact that
there was not unanimity among the general partners regarding this
Transaction. Although Mr. Froelich has not recommended the
Transaction since he believes that another method for determining
a fair price for the assets should be used, Mr. Froelich is not
saying that the price is or is not fair or that you should or
should not vote for the Transaction. However, Mr. Froelich has not
objected to this decision being left in the hands of the Limited
Partners. These are your assets and you should decide their
ultimate fate.
7. Alternatives. As described in the Proxy Statement under the
heading "Special Factors - Alternatives to the Transaction," the
Operating General Partners spent significant time in considering
several alternatives to the Transaction, including the solicitation
of third-party bids. It remains the belief of the Operating
General Partners that the proxy review and solicitation process has
made available to potential bidders sufficient information
regarding the Partnership's assets to allow all interested parties
to make a fully informed decision as to whether to pursue the
acquisition of such assets. To the extent the Partnership receives
an offer that is more beneficial to the Limited Partners than the
Transaction, the Limited Partners will be notified and the proxy
solicitation will be amended.
The Mills Firm provides no support for its statement that the
assets "may be worth more than is being offered." The Mills Firm
is essentially offering "scare tactics" and no real alternative to
the Transaction. On the other hand, the purchase price being paid
by the Purchaser is supported by the valuation of Cushman &
Wakefield, an independent, third-party appraiser, as well as
Cushman & Wakefield's opinion that the price being paid by the
Purchaser is fair from a financial point of view.
Do not be fooled by the misstatements set forth in The Mills Firm
letter - their statements are designed to be highly inflammatory,
but in reality lack a solid foundation. The decision to approve
the Transaction is yours and yours alone. We appreciate your
continued support and confidence and look forward to seeing you at
the Special Meeting now being held on October 9, 1996 at 3:30 p.m.
at the Partnership's offices, 150 South Wacker Drive, Chicago,
Illinois 60606. Again, if you have questions or concerns, please
call us directly at (800) 272-8846 or the Herman Group at (800)-992-6145.
Very Truly yours,
/s/ Jerome J. Brault
Jerome J. Brault
Managing General Partner
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