April 3, 2006
Daniel F. Duchovny
Office of Mergers and Acquisitions
Securities and Exchange Commission
Washington, D.C. 20549
Re: Capital Realty Investors-III, L.P., Schedule TO-T filed March 15, 2006 by
MacKenzie Patterson Fuller, LP and its affiliates, the Purchasers
Dear Mr. Duchovny:
Thank you for your letter dated March 22, 2006 regarding our recent Schedule
TO-T. I will respond to the questions you asked in your letter in the order in
which you posed them.
1. We are amending the filing to disclose that this price was incorrect.
The publication mistakenly published this trade. The reported trade
was not in fact made (it was, according to the publisher, a trade for
a different partnership). We are now disclosing that Stanger had no
recent reported trades.
2. We are revising to indicate that the liquidation value in the proxy
was relating to a request to approve liquidation and that the vote was
successful, as the limited partners have previously been notified by
the Partnership.
3. We agree that all such conditions must be satisfied or waived prior to
expiration and that we cannot accept securities prior to expiration.
Nonetheless, the depository has signed letters of transmittal prior to
expiration, hence the disclosure. We disclose this potential conflict
without being able to state what the conflict might be because we
don't really know what conflict could arise. Hence, we also say
because the Depository's role is administrative only, any conflict
would be immaterial. The reason for this disclosure is just to raise
the issue that the Depository is not an independent party. This is
really an immaterial issue--we are being overbroad, if anything, and
disclosing, in response to prior comments, that the depository is not
independent. All we mean is that when security holders send their
tender documents to us, we are in control of them even if the offer
has not closed. In other words, we may have the piece of paper that a
unit holder signs prior to expiration of the offer. Of course we are
obligated to recognize the withdrawal rights of the security holder
and cannot purchase the units prior to expiration and the satisfaction
or waiver of all conditions (and the letter of transmittal
incorporates the terms and conditions of the Offer, so it would be
inoperative if we did not comply with the offer terms). We are
clarifying.
4. Section 13 states that "The Purchasers shall not be required to accept
for payment or pay for any Units and may terminate or amend the Offer
as to such Units if, at any time on or after the date of the Offer and
before the Expiration Date, any of the following conditions
exists...." The last paragraph of the cover page you reference states
that we can "upon the occurrence of any of the conditions specified in
Section 13...," terminate the offer, thus incorporating the
requirement that termination occur before the expiration, a logical
requirement as well. Further, the third clause includes the
requirement that any amendment be made "prior to the Expiration Date."
We are clarifying in this amendment.
Closing paragraphs: While acknowledging the Staff's positions, and without
implying any specific issue with such position, we respectfully decline to make
the statements requested. There is no requirement that we do so. To the extent
the requested statements are accurate statements of applicable law, there is no
reason to obtain from bidders a recitation of such law. To the extent the
statements go beyond applicable law or reflect interpretations of law that may
be open to dispute, it would not be fair or appropriate to require bidders to
make statements that might prejudice their right to take a contrary position at
some later time, if the occasion arose.
Please let me know if you have any questions or further comments.
Very Truly Yours,
Chip Patterson
Senior Vice President and General Counsel
(925) 631-9100 ext. 206
(925) 871-4046 (Fax)
chip@mpfi.com