SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
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
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
AEI NET LEASE INCOME & GROWTH FUND XIX LIMITED PARTNERSHIP
(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):
[X] No 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:
2) Aggregate number of securities to which transaction applies:
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):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] 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:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
AEI NET LEASE INCOME & GROWTH FUND XIX LIMITED PARTNERSHIP
CONSENT STATEMENT
For Amendment to Limited Partnership Agreement to Permit
Reinvestment of Sales Proceeds
THIS CONSENT STATEMENT IS BEING MAILED TO INVESTORS ON OR ABOUT
SEPTEMBER 30, 1998. TO BE COUNTED, A PROPERLY SIGNED CONSENT FORM MUST
BE RECEIVED BY THE MANAGING GENERAL PARTNER AT 1300 MINNESOTA WORLD
TRADE CENTER, 30 EAST 7TH STREET, ST. PAUL, MINNESOTA 55101, ON OR
BEFORE 5:00 P.M. CENTRAL STANDARD TIME ON NOVEMBER 20, 1998.
AEI Fund Management XIX, Inc., the Managing General Partner of
AEI Net Lease Income & Growth Fund XIX Limited Partnership (the
"Fund") is recommending an amendment (the "Amendment") to the Fund's
Limited Partnership Agreement (the "Fund Agreement"). The Amendment
would change Section 5.4 of the Fund Agreement to allow proceeds from
sale of Fund properties to be reinvested in replacement properties
until final liquidation of the Fund. The Fund Agreement currently
requires that reinvestments end on February 5, 1998. For ease of
understanding, this Consent Statement sometimes refers to AEI Fund
Management XIX, Inc. as the "General Partner", "we" or "us" and to a
limited partner in the Fund as an "Investor" or as "you".
The proposed Amendment will affect your investment in the
Fund in a number of ways and involve a number of risks that are
discussed in more detail under the caption "Summary" and "Risks of
the Amendment," including the following:
<bullet> Distributions of some sales proceeds, including approximately
$1,480,000 or $69.00 per Unit currently held by the Fund that
will be distributed if the amendment is not approved, will be
delayed until liquidation (expected to commence in 2004).
<bullet> The reinvestments could cause extension of the life of the Fund.
<bullet> Our interests as General Partners in approval of the Amendment
may conflict with your interests because we will receive higher
reimbursements if the Fund retains more assets under management,
which is the likely effect of the Amendment.
<bullet> Properties in which proceeds are reinvested will be subject to
many of the same risks of nonperformance as the original
properties.
<bullet> Investors will not be able to review in advance the properties
in which proceeds are reinvested.
Currently, we are required to distribute proceeds if a
property is sold. Because this encourages the Fund not to sell
properties, we do not believe that this is in the best interest of
partners. We believe that the Fund should be able to take advantage
of property sales, when available at attractive prices, without
depleting the capital base of the Fund. Approval of the Amendment
would allow us to continue to reinvest proceeds from the sale of
properties in replacement properties until final liquidation of the
Fund. Accordingly, we recommend a vote "FOR" the proposed amendment.
Approval of the amendment will, however, mean that you
will not receive cash as quickly as you would if the cash is not
reinvested. If you believe that it is the best interests of partners
to start now to receive cash back when a property is sold and require
the Fund to start to deplete, and return to investors, its capital
base, you should vote against the amendment.
APPROVAL OF THE AMENDMENT WILL REQUIRE THE AFFIRMATIVE
VOTE OF HOLDERS OF A MAJORITY OF THE OUTSTANDING UNITS. THERE WERE
20,974.63 UNITS OUTSTANDING AT JUNE 30, 1998. THE GENERAL PARTNER
AND ITS AFFILIATES HELD A TOTAL OF 45.5 UNITS AS OF JUNE 30, 1998
(LESS THAN 1% OF OUTSTANDING UNITS) AND INTEND TO VOTE ALL SUCH UNITS
IN FAVOR OF THE AMENDMENT. SEE "UNIT OWNERSHIP OF PRINCIPAL HOLDERS
AND MANAGEMENT."
You will not have appraisal or dissenters rights and
therefore will not have the right to require the Fund to pay you the
value of your Units if you disagree with the proposed Amendment.
The General Partners believe that the Amendment is fair
to Investors and reccomend a vote For the Amendment.
</PAGE>
<PAGE> SUMMARY
The following summary is qualified by the more detailed discussion
set forth herein.
The Amendment
We are proposing an amendment to Section 5.4 (the
"Amendment") of the Fund Agreement. The Fund Agreement currently
provides that proceeds from sale of properties cannot be reinvested
after February 2, 1998. The Amendment will eliminate the
requirement that the Fund distribute all proceeds from sale of
properties and, instead, allow reinvestment of proceeds until final
liquidation of the Fund. Even if the Amendment is approved,
however, most, if not all, gain from sales activity would continue
to be distributed to Investors. The Amendment is intended
primarily to allow the Fund to reinvest the portion of sales
proceeds that constitutes the original investment in a property,
while distributing the "gain" (the excess of sales proceeds over
the original investment).
Approval of the amendment will, however, mean that you
will not receive cash as quickly as you would if the cash is not
reinvested. For example, the Fund currently holds approximately
$1,480,000 that will be distributed to you at the rate of
approximately $69.00 per Unit if the Amendment is not approved, but
will be reinvested rather than distributed if the Amendment is
approved. If you believe that it is the best interests of partners
to start now to receive cash back when a property is sold and
require the Fund to start to deplete, and return to investors, its
capital base, you should vote against the amendment.
We do not intend to extend the life of the Fund through
the Amendment. The Fund Agreement provided that we would commence
liquidation of the Fund's properties 8 to 10 years after
acquisition. We continue to intend final liquidation of Fund
properties by the year 2004.
Reasons for the Amendment
The Fund may sell properties prior to final liquidation
of the Fund due to favorable market conditions, exercise of lease
purchase options, tenant restructuring or other reasons. Although
we cannot guarantee returns, we believe that the Fund can generate
favorable returns to Investors through the acquisition of
additional properties that can be resold. We believe that the Fund
should be in a position to reinvest the proceeds from these and
other sales into replacement net leased properties.
Risks of the Amendment
The Amendment will affect your fund in a number of
ways. Most notably, the Amendment will allow the Fund to reinvest
capital that would otherwise be distributed to you. Currently, if
cash proceeds are not reinvested, you would receive a distribution
of $69 per Unit. If the Amendment is approved, this cash will
likely be reinvested in new properties and will, subject to risks
inherent in operation of the Fund and real estate investments
generally, be distributed to you when the Fund liquidates. We
currently do not expect to start liquidation until 2004. There are
also other risks, such as the risk that this liquidation will be
prolonged and the final distribution delayed, the risk that our
recommendation may not be objective because we may benefit from the
amendment, the risk that you will not be able to assess the
properties in which we reinvest proceeds, and the myriad of risks
that relate to the ownership of real estate generally. These risks
are described in the "Risk Factors" Section that immediately
follows this summary.
Benefits to Insiders
The General Partners may benefit from the Amendment in
several respects. If the Amendment is approved, the Fund will
retain more properties under management and the General Partners
will receive more reimbursements from the Fund. Further, to the
extent funds are reinvested and properties perform well, the
likelihood that we will receive a higher percentage of cash flow
may be increased. See "Interests of the General Partner in the
Amendment."
Voting/Units Held by General Partners
The Amendment will require the affirmative vote of
holders of a majority of the outstanding Units. There were
20,974.63 Units outstanding at June 30, 1998. The General Partner
and its affiliates held a total of 45.5 Units as of June 30, 1998
and intend to vote all such Units in favor of the Amendment. See
"Unit Ownership of Principal Holders and Management."
</PAGE>
<PAGE>
RISKS OF THE AMENDMENT
The proposed Amendment will affect your investment in the
Fund in a number of ways and involve a number of risks that are
discussed in more detail under the caption "Summary" and "Risks of
the Amendment," including the following
1. DISTRIBUTION OF SALES PROCEEDS WILL BE DELAYED. Rather than
distributing all net cash proceeds on sale of a property, the
Amendment will allow the Fund (if we determine, in our discretion,
that it is advantageous to the Fund) to reinvest such proceeds in
new properties (subject to a continuing obligation to distribute to
you cash proceeds adequate to pay the income tax liability
generated by sales of property). The distribution of cash that is
reinvested will be delayed until the Fund is finally liquidated (
expected to start in 2004). The fund currently has approximately
$1,480,000 of sales proceeds that will be distributed, at the rate
of approximately $69 per Unit is the Amendment is not approved but
will likely be reinvest if the Amendment is approved.
2. THE LIQUIDATION PROCESS MAY BE DELAYED AND THE LIFE OF THE
FUND EXTENDED. We intend to reinvest sales proceeds in new
properties that can be sold again within a few years. Because this
will likely means we will have more properties to liquidate, the
Amendment could render more difficult the final sale of properties
within the original intended life of the Fund. We intend to
commence liquidation of the Fund through the sale of its remaining
properties within ten years after acquisition (in 2004), although
the sale of any particular property may be delayed based on market
and other conditions. The Amendment could have the effect of
extending the life of the Fund for several years and delaying the
ultimate distribution of its assets. The Fund Agreement provides
that the Fund must be liquidated, in any event, by December 31,
2041 (an arbitrary date).
3. REINVESTED PROCEEDS WILL BE SUBJECT TO THE RISKS OF REAL
ESTATE INVESTMENT. Proceeds will be reinvested in new triple net
leased commercial properties that are subject to the same risks of
performance as the properties originally acquired by the Fund. The
value of real estate is subject to a number of factors beyond the
control of the Fund, including national economic conditions,
changes in interest rates, governmental rules and regulations and
competition from other forms of financing. If adverse changes in
these general conditions negatively affect market value, the final
disposition of the property and the distribution of cash to
Investors may be delayed or the disposition may result in a loss,
or both. Among other things, the value of properties in which the
Fund will invest will be affected by the lease rates we are able to
negotiate and the financial condition of the tenant. Lease rates
as a percentage of property purchase price have declined in recent
years as interest rates have declined and as financing from other
sources, such as real estate investment trusts, has become more
available. To the extent interest rates and market lease rates
increase in the future, the value of real estate acquired by the
Fund when rates were lower may decline. If a tenant is unable to
perform its lease obligations, the Fund may not be able to sell the
property or may be forced to sell the property at a loss. Further,
in the event of a bankruptcy of a tenant, the Fund might not be
able to obtain possession of the property for a considerable period
of time. See "Reasons For and Effects of the Amendment."
4. INVESTORS WILL NOT BE ABLE TO REVIEW IN ADVANCE THE
PROPERTIES IN WHICH PROCEEDS WOULD BE REINVESTED. Some of the
properties in which proceeds are reinvested may be properties in
which another partnership that is sponsored by affiliates of the
general partners has invested.
5. THE GENERAL PARTNERS MAY BENEFIT FROM THE AMENDMENT IN WAYS
THAT CREATE CONFLICTS OF INTEREST. The interests of the General
Partners in proposing the Amendment may be different than your
interests because the General Partners will receive more
reimbursements from the Fund if proceeds are reinvested than they
will if proceeds are not reinvested. The General Partners are
reimbursed at cost, which includes a portion of the salaries of the
General Partner's personnel and other overhead, for services the
General Partners provide to the Fund. Reimbursements will decrease
if cash is distributed and fewer properties are under our
management in the Fund. See "Interests of the General Partner in
the Amendment."
6. INVESTORS WILL NOT HAVE APPRAISAL RIGHTS IN CONNECTION WITH
THE AMENDMENT. You will not have appraisal or dissenters rights as
a result of the Amendment. Accordingly, if you disagree with the
Amendment you will not have the right to require the Fund to pay
out the value of your Units. Instead, the Amendment will be
effective with respect to you if approved by holders of a majority
of the Units. If you disagree, you will be required to find a
different method of disposing of your Units, such as through the
Fund's repurchase plan, or to hold your Units until liquidation of
the Fund.
REASONS FOR THE AMENDMENT
If Investors approve the Amendment, the Fund will have the
opportunity, upon the sale or other disposition of properties such
as the properties described below, to reinvest the Net Proceeds of
Sale in additional triple net leased properties. Under the terms
of the Fund Agreement, the net proceeds from the sale of properties
cannot be reinvested after February 5, 1998. By consenting to the
Amendment, you would permit the Fund to acquire new properties with
the net proceeds from the sale of the properties (net of any
distributions to Investors). Because proceeds will be reinvested,
distributions of sales proceeds will be decreased until further
liquidation of the properties in which the proceeds are reinvested,
or until liquidation of the Fund.
The Amendment is not intended to extend the life of the Fund.
The Prospectus under which the Units were sold indicated that we
expected that most of the properties would be sold or refinanced
eight to ten years after acquisition. The Fund properties described
below were acquired between 1991 and 1997. It remains our
intention to commence liquidation of the Fund, depending on market
conditions and the benefits of continued ownership, through the
sale of the Fund's remaining properties by the year 2004.
We are proposing the Amendment for a number of reasons,
including the following:
<bullet> Without the Amendment, we will be required to forgo all
attractive proposals we receive to sell Fund properties
if we desire to avoid depleting the Fund's capital base.
<bullet> If the Amendment is approved, the Fund will be able to
(i) take advantage of any favorable purchase proposals
that are presented, (ii) seek out such proposals when
market conditions are favorable, and (iii) retain adequate
capital in the Fund to work toward the Fund's investment
objectives.
<bullet> Without the Amendment, if a property is sold prior to
final liquidation of the Fund, the Fund's capital base,
and therefore its ability to generate the level of
return that was the objective when it was formed, will be
reduced.
<bullet> If the Amendment is approved, cash proceeds from the sale
of a property may be reinvested in a new property.
Subject to the same risks of real estate investment that
were assumed when the Fund was formed, the new property
could generate continuing cash flow from rents and potential
gain on sale.
<bullet> Without the Amendment, if you wish to invest distributed
sales proceeds (which constitute a return of a portion
of your original investment in the Fund) in a similar
vehicle such as an AEI fund, you would be forced to
purchase units in a new fund with distributed cash. Real
estate funds are initially offered subject to sales
commissions and organization expense that decrease the
amount invested in properties and, therefore, the asset
base that generates income and gain on an investment.
<bullet> If the Amendment is approved, no securities brokerage
commissions or other organizational expense will reduce
the cash reinvested in new properties.
The Fund incurs a significant amount of organization and
syndication expense at formation. We believe that the Fund can
generate the most favorable returns to Investors only if the costs
of forming the Fund, including commissions to sales agents, filing
fees and professional costs, can be amortized against cash flow
(primarily rents) from operation of all properties over the
intended life of the Fund (8 to 10 years after purchase of
properties). If a significant portion of the real property assets
of the Fund are sold in advance of the originally intended
liquidation date of the Fund, the income and gain from the assets
remaining may not be adequate to generate the returns that were the
original objective of the Fund.
The Fund has periodically sold properties in the past and,
through February 5, 1998, reinvested some of the sale proceeds in
new properties. We normally distribute that portion of the
proceeds that respesents gain and always distribute enough to cover
income tax liability. Nevertheless, we have generally retained the
remainder of the proceeds to reinvest in new properties.
</PAGE>
<PAGE>
There are possible disadvantages to the Amendment you should
also consider, including the following:
<bullet> Without the Amendment, the Fund will distribute to you,
commencing immediately, the portion of proceeds from
sale not needed to continue to run the Fund. Currently
this would mean a distribution of approximately $69 per
Unit.
<bullet> If the Amendment is approved, it is likely that you will
not receive distribution of sales proceeds, other than
the portion necessary to cover taxes and that represents
gain, until the Fund commence liquidation (expected in
2004).
<bullet> Without the Amendment, the Fund's properties may more
gradually be sold.
<bullet> If the Amendment is approved, it may be more difficult for
the Fund to rapidly sell all of its properties in
liquidation.
<bullet> Without the Amendment, the size of the Fund will decrease
and the amount of reimbursements the General Partners from
the Fund will decline.
<bullet> If the Amendment is approved, more capital will be
retained in the Fund and it is likely that reimbursements
to the General Partners will remain approximately the
same.
The principal alternative to the Amendment is to distribute
proceeds to investors as properties are disposed. As discussed
above, the General Partners are proposing that this not be the
alternative selected because they believe it depletes the capital
base and decreases the liklihood that the Fund will perform
favorably.
At June 30, 1998, the Fund held approximately $1,480,000 of
proceeds from early payment of a promissory note it had received on
sale of a property. We are proposing the Amendment so that these
proceeds, and other proceeds we may generate on sale of properties
in the future, can be reinvested.
</PAGE>
<PAGE> EFFECTS OF AMENDMENT
In the event Investors approve the Amendment, a portion of the
proceeds from properties sold or otherwise disposed of will be
reinvested rather than distributed. The Fund will not change its
investment objectives or policies. Accordingly, new properties in
which such proceeds are invested will consist primarily of single
tenant, triple net leased properties that are purchased without
indebtedness, many of which are leased to tenants in the restaurant
industry. See "Reasons for the Amendment." As of June 30, 1998,
the Fund held interests in seventeen properties as summarized below:
Property Acquisition Annual Rental
Cost Payments
Applebee's Restaurant, Aurora, CO (1) $ 44,782 $ 6,263
Applebee's Restaurant, Beaverton, OR 1,760,079 237,682
Applebee's Restaurant, Covington, LA 1,099,085 161,462
Applebee's Restaurant, Crestview Hills, KY(1) 14,039 1,933
Applebee's Restaurant, Crestwood, MO 803,418 111,709
Applebee's Restaurant, Temple Terrace, FL(1) 96,262 13,986
Champps Americana Restaurant, Troy, MI (2) 361,889 25,332
Denny's, Apple Valley, CA 1,177,655 168,910
Garden Ridge Retail Store, Pineville, NC 3,615,378 383,973
HomeTown Buffet Restaurant, Tucson, AZ (1) 610,755 80,960
Media Play Retail Store, Apple Valley, MN 1,389,367 (3)
Party City Retail Store, Gainesville, GA 1,435,309 150,752
Red Line Burgers Restaurant, Corpus Christi, TX 280,378 15,000
Red Line Burgers Restaurant, Houston, TX 299,531 (3)
Taco Cabana Restaurant, Houston, TX 547,322 79,570
Taco Cabana Restaurant, San Antonio, TX 1,147,274 179,503
Taco Cabana Restaurant, Waco, TX 19,720 2,779
Total $14,702,243 $1,619,814
(1) A portion of the Fund's interest in the property has been sold.
(2) Restaurant is under construction as of June 30, 1998.
(3) The property is vacant and listed for sale or lease.
If the proceeds are reinvested, the rental revenues generated by
the Fund would be increased and distributions from rental revenues
will be higher than they will if proceeds are not reinvested.
Distribution of sales proceeds will be reduced or delayed until
liquidation of the Fund. Accordingly, we believe approval of the
Amendment will result in a more steady rate of distribution during
the life of the Fund with a large distribution at the end of the
life of the Fund.
If Investors do not approve the Amendment, Investors will
receive a distribution of sales proceeds of approximately
$1,480,000, or approximately $69.00 per outstanding Unit, in the
fourth quarter of 1998. This distribution of Net Proceeds of Sale
would reduce the adjusted capital contributions of investors by an
additional $69.00 per outstanding limited partnership unit.
CONFLICTS OF INTEREST OF THE GENERAL PARTNERS IN THE AMENDMENT
In proposing the Amendment, we may have certain conflicts of
interest because the Amendment will affect us in ways that may be
different from the ways it affects you. We have not retained an
unaffiliated representative for the limited partners in proposing
the Amendment because we believe that, as a whole, the benefits we
derive if the Fund is more profitable are the same as the benefits
derived by limited partners. Nevertheless, We also are compensated
in part on the basis of the scope of the Funds operations and
therefore may have different motivations than you. Accordingly,
our recommendation may not be entirely objective.
In accordance with, and subject to the limitations in, the Fund
Agreement, we will be reimbursed for any costs (including a
proportionate amount of employee salary, benefit and overhead
expense) we incur in completing any property acquisition and in
connection with management of the property. Generally, we allocate
costs to the Fund based on the daily
</PAGE>
time sheets of our employees. We establish an hourly charge for
each employee based on their salaries, benefit expense and overhead
expense (the portion of rental, depreciation and other office
charges necessary to maintain the employee) and the Fund is charged
for the amount of time spent by the employee on Fund activities
multiplied by the time charge. If the Amendment is not approved,
and the proceeds from the sale of the properties are not
reinvested, the amount of capital under our management through the
Fund, and the scope of the Fund's operations, will be reduced and
we will have to deploy our employees in other activities. Such
reduced operations can be expected to reduce the amount of
reimbursements that we receive from the Fund. Reimbursements to us
by the Fund for expenses incurred have averaged approximately
$338,285 per year during the past two years and aggregated
approximately over $1,041,791 during the three years ended December
31, 1997. Such reimbursements will decrease if cash is distributed
and fewer properties are acquired and under management in the Fund.
Further, we receive more than 1% of Fund cash flow only to the
extent the Fund has generated a 10% return to Investors, and we
share in sales proceeds only to the extent the Fund has paid
cumulative distributions to Investors equal to their Adjusted
Capital Contributions plus a 12% cumulative return. To the extent
that proceeds are reinvested, the properties perform well, and
these returns can be achieved, we may receive up to 10% of the cash
flow remaining after payment of the 10% return to Investors and up
to 10% of sales proceeds remaining after payment of the 12%
cumulative return to Investors.
HISTORICAL CASH DISTRIBUTIONS
The following table sets forth the total cash distributions made
to Investors and the percent of such distributions representing a
return of capital for the fiscal years ended December 31, 1993,
1994, 1995, 1996 and 1997 and the six month period ended June 30,
1998:
Percent
Fiscal Year Ended Distributions Representing
December 31, Cash Redemptions Total Per Unit Return of Capital
1993 $2,014,144 $ 0 $2,014,144 $ 97.32 28.8%
1994 2,062,333 0 2,062,333 97.50 3.6%
1995 2,062,326 25,466 2,087,792 98.74 0%
1996 1,741,754 83,145 1,824,899 86.51 0%
1997 1,649,163 30,164 1,679,777 79.97 14.6%
Six month
period Ended
June 30, 1998 758,191 0 758,191 36.15 8.9%
UNIT OWNERSHIP OF PRINCIPAL HOLDERS AND MANAGEMENT
The following table sets forth information about the number of
Units owned by each person known by the Fund to beneficially own 5%
or more of the Units, by each General Partner, and by each
officer or director of AEI Fund Management, Inc. as of June 30, 1998:
Name and Address Number of Percent
of Beneficial Owner Units Held of Class
AEI Fund Management XIX, Inc. 0 0%
1300 Minnesota World Trade Center
30 East 7th Street, St. Paul, Minnesota 55101
Robert P. Johnson 45.5 *
1300 Minnesota World Trade Center
30 East 7th Street, St. Paul, Minnesota 55101
Mark E. Larson 0 0%
1300 Minnesota World Trade Center
30 East 7th Street, St. Paul, Minnesota 55101
* Less than 1%
The persons set forth in the preceding table hold sole voting power
and power of disposition with respect to all of the Units set forth
opposite their names. We know of no holders of more than 5% of the
outstanding Units.
VOTE REQUIRED AND PROCEDURES FOR VOTING
Voting by Investors with respect to an amendment of the Fund
Agreement is based upon ownership of limited partner units
("Units"). As of June 30, 1998, there were 20,974.63 Units
outstanding. Each Unit is entitled to one vote. Fractions of
Units will be included in the total.
In order for the proposed Amendment to be adopted, a majority of
the Units must be voted in favor of the Amendment. Because an
abstention would not be counted as a vote for an amendment, it
would have the effect of a vote against an amendment. The General
Partner intends to vote all 45.5 Units controlled by it in favor of
the Amendment.
Accompanying this Consent Statement is a Consent Form for you.
By checking the appropriate box, you can indicate whether you vote
FOR or AGAINST or ABSTAIN as to the proposed Amendment. If you
return a Consent Form that is signed without checking any box, you
will be deemed to have voted FOR the Amendment. If you vote
against, or abstain with respect to, the Amendment, you do not have
appraisal or similar rights under Minnesota law.
We have fixed the close of business on September 1, 1998 as the
record date for the determination of the Investors entitled to vote
on the proposed Amendment, 5:00 p.m. central standard time on
November 20, 1998 as the date by which Consent Forms must be received
by us in order to be counted, and November 23, 1998 as the date on
which the consents are to be counted. You may revoke your
consent at any time prior to 5:00 p.m. central standard time on
November 20, 1998 provided written revocation is received by us prior
to that date. Consents may be delivered, or revoked, by Fax received
prior to the times set forth above, provided that an original signed
copy is received within five business days of the fax.
The cost of solicitation of consents will be borne by the Fund.
The solicitations will be made by the mails. This Consent
Statement is being first mailed on or about September 30, 1998. Our
staff will be available by telephone to answer any questions
concerning this Consent at (800) 328-3519.
INCORPORATION BY REFERENCE/FORWARD LOOKING STATEMENTS
This consent statement relies on information that is contained
in the Fund's Annual Report on Form 10-KSB for the year ended
December 31, 1997 and quarterly report on Form 10-QSB/A-1 for
the quarter ended June 30, 1998 (File Number 0-19838)
</PAGE>
<PAGE>
(the "Reports"). That information is "incorporated by reference"
in this consent statement under the Commission's rules. A copy of
the Reports are being delivered to you with this Consent Statement.
BY ORDER OF THE BOARD OF DIRECTORS
OF AEI FUND MANAGEMENT XIX, INC.
Robert P. Johnson, President
</PAGE>
<PAGE> Exhibit A
PROPOSED AMENDMENT OF
LIMITED PARTNERSHIP AGREEMENT OF
AEI NET LEASE INCOME & GROWTH FUND XIX
Changes in the existing provisions of the Partnership
Agreement that would be made by the proposed Amendment are shown
below. Existing provisions proposed to be omitted are lined
through and enclosed in brackets. New Provisions are printed in
bold type. Only the portion of Section 5.4 that will be changed by
the Amendment is shown. If approved, the Amendment will be
effective immediately.
SECTION 5.4 DISTRIBUTION OF NET PROCEEDS OF SALE
5.4 Distribution of Net Proceeds of Sale. Upon financing,
refinancing, sale or other disposition of any of the Properties,
Net Proceeds of Sale may be reinvested in additional properties
until [a date five years after the date on which the offer and sale
of units pursuant to the Prospectus is terminated,] THE GENERAL
PARTNER DETERMINES THAT IT IS IN THE BEST INTERESTS OF THE FUND TO
BEGIN LIQUIDATION OF THE FUND; provided, however, that sufficient
cash is distributed to the Limited Partners to pay state and
federal income taxes (assuming Limited Partners are taxable at a
marginal rate of 28% for federal income tax purposes or such
greater rate as is the maximum effective rate for federal income
taxation applicable to individuals) created as a result of such
transaction.
</PAGE>
<PAGE>
IMPORTANT IMPORTANT
AEI NET LEASE INCOME & GROWTH FUND XIX LIMITED PARTNERSHIP
CONSENT OF LIMITED PARTNERS
This consent is solicited by the Board
of Directors of AEI Fund Management XIX, Inc.,
The Managing General Partner
The undersigned, a Limited Partner of AEI Net Lease Income &
Growth Fund XIX Limited Partnership (the "Fund"), hereby consents
(unless otherwise directed below) to the proposal identified below
to adopt an Amendment to Section 5.4 of the Limited Partnership
Agreement (the "Partnership Agreement") of the Fund (the
"Amendment"), as more fully described in the accompanying Consent
Statement. By voting for the Amendment the undersigned hereby
names AEI Fund Management XIX, Inc. as his/her/its attorney-in-fact
with power to sign and acknowledge on the undersigned's behalf any
instrument that may be necessary to evidence the Amendment and any
corresponding Amendment to the Fund's Certificate of Limited
Partnership.
Please date and sign this Consent below and return it in the
enclosed, postage paid envelope. To be counted, this Consent must
be received not later than 5:00 p.m. central standard time on
November 20, 1998.
Adoption of the Amendment to Section 5.4 of the Partnership
Agreement
[ ] FOR [ ] AGAINST [ ] ABSTAIN
The Fund Units held by the signing Limited Partner will be
voted as directed. They will be voted "FOR" the Amendment if no
box is checked.
Please sign exactly as your name appears below. When Fund
Units are held by joint tenants, both owners should sign. When
signing as attorney, executor, administrator, trustee or guardian,
please give full title as such. If a corporation, please sign in
full corporate name by president or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
PLEASE MARK, SIGN, DATE AND PROMPTLY RETURN THIS CONSENT.
Dated: , 1998
Signature (if held jointly)
</PAGE>
