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UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
 Form 10-QSB [X]
    
    QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THESECURITIES EXCHANGE ACT OF 1934For the quarterly period ended March 31, 2004OR[   ]
    
    TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THESECURITIES EXCHANGE ACT OF 1934For the transition period from  to
 Commission file number: 33-77510-C CAPTEC FRANCHISE CAPITAL PARTNERS L.P. III 
  Delaware 
  38-3160141 
  24 Frank Lloyd Wright Drive, Lobby L, 4th Floor
P.O. Box 544, Ann Arbor, Michigan 48106-0544 
  (734) 994-5505 
  Not Applicable 
  Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or such shorter period that the registrant
was required to file such reports), and (2) has been subject to filing
requirements for the past 90 days. Yes [X] No [   ] APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by court: Not applicable APPLICABLE ONLY TO CORPORATE ISSUERS State the number of shares outstanding of each of the issuers classes of
common equity, as of the latest practicable date: Not applicable Transitional Small Business Disclosure Format (check one) Yes [   ] No [X]




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CAPTEC FRANCHISE CAPITAL PARTNERS L.P. III Index to Form 10-QSB  
 Item No.
    
    
    
    PagePART I
    
    FINANCIAL INFORMATIONItem 1.
    
    Financial Statements:Balance Sheets, March 31, 2004 and December 31, 2003
    
    
    3Statement of Operations for the three months
ended March 31, 2004 and 2003
    
    
    4Statement of Changes in Partners Capital for the three months
ended March 31, 2004
    
    
    5Statement of Cash Flows for the three months
ended March 31, 2004 and 2003
    
    
    6Notes to Financial Statements
    
    
    7-9Item 2.
    
    Managements Discussion and Analysis of Financial Condition
and Results of Operations
    
    
    9-11Item 3.
    
    Controls and Procedures
    
    
    11PART II
    
    OTHER INFORMATIONOther Information
    
    
    12SIGNATURES
    
    
    
    
    13CERTIFICATION Pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002
    
    
    14-15Certification Pursuant to Section 302Certification Pursuant to Section 1350
  2




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Captec Franchise Capital Partners L.P. III 
 Balance Sheets
 March 31,
    
    December 31,2004
    
    2003(Unaudited)Cash and cash equivalents
    
    $
    432,730
    
    
    $
    537,442Restricted cash
    
    
    488,720
    
    
    
    454,540Investment in leases:Operating leases, net
    
    
    14,426,340
    
    
    
    14,485,860Financing leases, net
    
    
    349,562
    
    
    
    532,700Impaired financing leases, net
    
    
    12,693
    
    
    
    12,693Accounts receivable
    
    
    22,004
    
    
    
    18,168Unbilled rent, net
    
    
    1,042,085
    
    
    
    1,013,362Due from related parties
    
    
    5,016
    
    
    
    8,216Deferred financing costs, net
    
    
    227,007
    
    
    
    238,954Total assets
    
    $
    17,006,157
    
    
    $
    17,301,935Liabilities and Partners CapitalLiabilities:Notes payable
    
    $
    5,666,786
    
    
    $
    5,704,585Accounts payable and accrued
expenses
    
    
    118,082
    
    
    
    120,873Security deposits held on leases
    
    
    7,106
    
    
    
    7,106Total liabilities
    
    
    5,791,974
    
    
    
    5,832,564Partners capital:Limited partners capital accounts
    
    
    11,196,053
    
    
    
    11,453,527General partners capital account
    
    
    18,130
    
    
    
    15,844Total partners capital
    
    
    11,214,183
    
    
    
    11,469,371Total liabilities and
partners capital
    
    $
    17,006,157
    
    
    $
    17,301,935
 The accompanying notes are an integral part of the financial statements. 3




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Captec Franchise Capital Partners L.P. III 
 Statements of Operations
 
 2004
    
    2003Operating revenue:Rental income
    
    $
    448,766
    
    
    $
    456,243Finance income
    
    
    8,597
    
    
    
    14,052Total operating revenue
    
    
    457,363
    
    
    
    470,295Operating costs and expenses:Interest expense
    
    
    131,399
    
    
    
    135,184Depreciation
    
    
    59,520
    
    
    
    59,520General and administrative
    
    
    45,382
    
    
    
    39,077Total operating costs and expenses
    
    
    236,301
    
    
    
    233,781Income from operations
    
    
    221,062
    
    
    
    236,514Other income:Gain on sale of equipment
    
    
    1,914
    
    
    
    6,177Interest and other income
    
    
    5,655
    
    
    
    9,106Total other income
    
    
    7,569
    
    
    
    15,283Income from
continuing operations
    
    
    228,631
    
    
    
    251,797Discontinued Operations:Income from discontinued operations, net
    
    
    
    
    
    
    42,414Income from discontinued operations
    
    
    
    
    
    
    42,414Net Income
    
    $
    228,631
    
    
    $
    294,211Net income allocable to general partner
    
    $
    2,286
    
    
    $
    2,942Net income allocable to limited partners
    
    $
    226,345
    
    
    $
    291,269Net income  per limited partnership unit from continuing operations
    
    
    11.53
    
    
    
    12.68Net income  per limited partnership unit from discontinued operations
    
    
    
    
    
    
    2.14Net income per limited partnership unit
    
    $
    11.53
    
    
    $
    14.82Weighted average number of limited partnership
units outstanding
    
    
    19,633
    
    
    
    19,653
 The accompanying notes are an integral part of the financial statements. 4




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Captec Franchise Capital Partners L.P. III 
 Statements of Changes in Partners Capital
 
 Limited
    
    Limited
    
    General
    
    TotalPartners
    
    Partners
    
    Partners
    
    PartnersUnits
    
    Accounts
    
    Account
    
    CapitalBalance, December 31, 2003
    
    
    19,633
    
    
    $
    11,453,527
    
    
    $
    15,844
    
    
    $
    11,469,371Distributions  ($24.64 per weighted average
limited partnership unit)
    
    
    
    
    
    
    (483,819
    )
    
    
    
    
    
    
    (483,819
    )Net income
    
    
    
    
    
    
    226,345
    
    
    
    2,286
    
    
    
    228,631Balance, March 31, 2004
    
    
    19,633
    
    
    $
    11,196,053
    
    
    $
    18,130
    
    
    $
    11,214,183
 The accompanying notes are an integral part of the financial statements. 5




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Captec Franchise Capital Partners L.P. III 
 Statements of Cash Flows
 
 2004
    
    2003Cash flows from operating activities:Net Income
    
    $
    228,631
    
    
    $
    294,211Adjustments to net income:Depreciation
    
    
    59,520
    
    
    
    70,095Amortization of debt issuance costs
    
    
    11,947
    
    
    
    11,948Gain on sale of equipment
    
    
    (1,914
    )
    
    
    (6,177
    )Increase in unbilled rent
    
    
    (28,723
    )
    
    
    (61,124
    )Increase in accounts receivable
    
    
    (3,836
    )
    
    
    (2,816
    )Decrease in accounts payable and accrued expenses
    
    
    (2,791
    )
    
    
    (38,491
    )Increase in restricted cash
    
    
    (34,180
    )
    
    
    (47,154
    )Decrease (increase) in due from related parties
    
    
    3,200
    
    
    
    (3,310
    )Net cash provided by operating activities
    
    
    231,854
    
    
    
    217,182Cash flows from investing activities:Net proceeds from sale of equipment
    
    
    142,475
    
    
    
    24,075Principal payments on financing leases
    
    
    42,577
    
    
    
    58,630Net cash provided by investing activities
    
    
    185,052
    
    
    
    82,705Cash flows from financing activities:Repayments of notes payable
    
    
    (37,799
    )
    
    
    (46,942
    )Distributions to limited partners
    
    
    (483,819
    )
    
    
    (340,000
    )Net cash used in financing activities
    
    
    (521,618
    )
    
    
    (386,942
    )Net decrease in cash and cash equivalents
    
    
    (104,712
    )
    
    
    (87,055
    )Cash and cash equivalents, beginning of year
    
    
    537,442
    
    
    
    286,511Cash and cash equivalents, end of year
    
    $
    432,730
    
    
    $
    199,456
 The accompanying notes are an integral part of the financial statements. 6




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CAPTEC FRANCHISE CAPITAL PARTNERS L.P. III 
 NOTES TO FINANCIAL STATEMENTS
  1.
    
    THE PARTNERSHIP AND ITS SIGNIFICANT ACCOUNTING PRINCIPLES:Captec Franchise Capital Partners L.P. III (the Partnership), a
Delaware limited partnership, was formed on February 18, 1994 for the
purpose of acquiring income-producing commercial real properties and
equipment leased on a triple net basis, primarily to operators of
national and regional franchised businesses.The initial General Partners upon formation of the Partnership were
Captec Franchise Capital Corporation III (the Corporation), a
wholly-owned subsidiary of Captec Financial Group, Inc. (Captec), an
affiliate, and Patrick L. Beach, the Chairman of the Board of Directors,
President and Chief Executive Officer of the Corporation and Captec. In
August 1998, Captec Net Lease Realty, Inc. (Captec Net Lease Realty),
an affiliate, acquired the General Partnership interests of the
Partnership. In December 2001, Captec Net Lease Realty merged with and
into Commercial Net Lease Realty, Inc. (Commercial Net Lease). In
connection with the merger, Commercial Net Lease agreed to sell and
assign its General Partnership interest in the Partnership to GP3 Asset
Acquisition, LLC (GP3 Asset Acquisition), which is wholly-owned by Mr.
Beach and is an affiliate of Captec. Effective January 15, 2002, the
limited partners consented to the transfer of the General Partnership
interest. On September 11, 2003, the Partnerships secured lender
consented to the transfer of the general partnership interest to GP3
Asset Acquisition. Upon receipt of the secured lenders consent, the
general partnership interest was immediately transferred to GP3 Asset
Acquisition. Therefore, as of September 11, 2003, GP3 Asset Acquisition
became the general partner of the Partnership.The Partnership commenced a public offering (the Offering) of up to
20,000 units (the Units) of limited partnership interests, priced at
$1,000 per Unit, by means of a Registration Statement on Form SB-2, under
the Securities Act of 1933, as amended, which was declared effective by
the Securities and Exchange Commission on August 12, 1994. The
Partnership accepted subscriptions for the minimum number of Units on
January 24, 1995 and immediately commenced operations. The Offering was
fully subscribed in August 1996. Since 1997, 367 Units have been
repurchased by the Partnership pursuant to the terms of the Repurchase
Plan set forth in the Partnerships August 12, 1994 prospectus with
respect to the Offering. At March 31, 2004, the Partnership had 19,633
Units issued and outstanding.The principal investment objectives of the Partnership are: (i)
preservation and protection of capital; (ii) distribution of cash flow
generated by the Partnerships leases; (iii) capital appreciation of the
Partnerships properties; (iv) generation of increased income and
protection against inflation through contractual escalation of base rents
or participation in gross revenues of tenants of the Partnerships
properties; and (v) deferred taxation of cash distributions to the
limited partners.Allocation of profits, losses and cash distributions from operations and
cash distributions from sale or refinancing are made pursuant to the
terms of the Partnership Agreement. Profits and losses from operations
are allocated among the limited partners based upon the number of Units
owned.Net income per limited partnership interest is calculated using the
weighted average number of limited partnership Units outstanding during
the period and the limited partners allocable share of the net income.Distributions per limited partnership Unit is calculated using the actual
distributions disbursed during the period to the weighted average number
of limited partnership Units during the period. Actual individual limited
partner distributions realized may vary from this calculation as a result 7




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of a variety of factors including: (i) actual distributions are computed
based on quarterly operating results and outstanding limited partnership
units, which are disbursed in the subsequent quarter; (ii) certain
limited partners have elected to receive monthly distributions versus
quarterly distributions which creates timing differences between
comparative calculations, and (iii) the calculation ignores the timing of
repurchases.  The balance sheet of the Partnership as of March 31, 2004, the statements
of operations and cash flows for the periods ending March 31, 2004 and
March 31, 2003 and the statement of changes in partners capital for the
period ending March 31, 2004 have not been audited. In the opinion of
management, these unaudited financial statements contain all adjustments
necessary to present fairly the financial position and results of
operations and cash flows of the Partnership for the periods then ended.
Results of operations for the interim periods are not necessarily
indicative of results for the full year. These unaudited financial
statements should be read in conjunction with the financial statements
and notes thereto included in the Partnerships annual report on Form
10-KSB for the year ended December 31, 2003 filed with the United States
Securities and Exchange Commission on March 28, 2004.  2.
    
    LAND AND BUILDING SUBJECT TO OPERATING LEASES:The net investment in operating leases as of March 31, 2004 is comprised
of the following: Land
    
    $
    6,540,429Building and improvements
    
    
    9,522,84816,063,277Less accumulated depreciation
    
    
    (1,636,937
    )Total
    
    $
    14,426,340
  3.
    
    NET INVESTMENT IN FINANCING LEASES:The net investment in financing leases as of March 31, 2004 is comprised
of the following: Minimum lease payments to be received
    
    $
    417,942Estimated residual value
    
    
    Gross investment in financing leases
    
    
    417,942Less unearned income
    
    
    (68,380
    )Net investment in financing leases
    
    $
    349,562
  4.
    
    NOTES PAYABLE:In November 1998, the Partnership entered into a $6.2 million term note.
The note has a ten-year term, is collateralized by certain properties
subject to operating leases which have a carrying value of approximately
$7.7 million, and bears an interest rate of 8.37% per annum.In March 1999, the Partnership entered into an additional $2.0 million
term note. The note has a ten-year term, is collateralized by certain
properties subject to operating leases which have a carrying value of
approximately $3.8 million, and bears an interest rate of 8.5% per annum.In September 2003 the partnership defeased approximately $1,979,000
of these notes payable with proceeds from the sale of a Red Robin
property. 8




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Debt issuance costs of $477,909 were incurred in connection
with the issuance of the notes, and are being amortized to interest
expense using the straight-line method over the ten-year term.5.
    
    EARNINGS FROM DISCONTINUED OPERATIONS:In accordance with SFAS No. 144, Accounting for Impairment or Disposal
of Long-Lived Assets, the Company has classified the operations of the
property sold during the third quarter of 2003 as discontinued operations. Accordingly, the results of
operations related to the property have been reclassified to earnings from discontinued
operations. Expenses include an allocation of interest expense based on the prorated share
of the outstanding debt. The following is a summary of earnings from
discontinued operations: March 31,2004
    
    2003Revenues:Operating lease rents
    
    $
    0
    
    
    $
    95,236Expenses:Interest expense
    
    
    
    
    
    
    41,295Provision for depreciation
    
    
    
    
    
    
    10,575Management Fees
    
    
    
    
    
    
    952Income from discontinued operation, net
    
    $
    0
    
    
    $
    42,414
 
  ITEM 2.  MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS  When used in this discussion, the words, intends, anticipates,
expects, and similar expressions are intended to identify
forward-looking statements. Forward-looking statements are subject to
certain risks and uncertainties, some of which are beyond the
Partnerships control, which could cause actual results to differ
materially from those projected. Such risks and uncertainties include
the following: (i) a tenant may default in making rent payments, (ii) a
fire or other casualty may interrupt the cash flow stream from a
property, (iii) the properties may not be able to be leased at the
assumed rental rates, (iv) unexpected expenses may be incurred in the
ownership of the properties, and (v) properties may not be able to be
sold at the presently anticipated prices and times. Any statements
contained in this report or any documents incorporated herein by
reference that are not statements of historical fact may be deemed to be
forward-looking statements. You should not place undue reliance on these
forward-looking statements, which speak only as of the date of this
report. The Partnership disclaims, except as may be required by law, any
obligations to update or release revisions to these forward-looking
statements to reflect events or circumstances after the date of this
report or to reflect the occurrence of unanticipated events. 9




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RESULTS OF OPERATIONSThree Months Ended March 31, 2004During the three months ended March 31, 2004 total operating revenue was
approximately $457,000, compared to $470,000 for the three months ended
March 31, 2003. Rental revenue from operating leases for the three
months ended March 31, 2004 decreased 1.6% to approximately $449,000
compared to approximately $456,000 for the three months ended March 31,
2003. Earned income from financing leases for the three months ended
March 31, 2004 decreased 38.8% to approximately $9,000 as compared to
approximately $14,000 for the three months ended March 31, 2003 as a
result of the amortization of the principal balances on the financing
leases and the disposition of two equipment leases, one in the fourth
quarter of 2003 and the other in the first quarter of 2004.Operating expenses increased 1.1% to approximately $236,000 for the three
months ended March 31, 2004, compared to approximately $234,000 for the
three months ended March 31, 2003. Interest expense decreased by
approximately $4,000 for the three months ended March 31, 2004 compared
to the prior period. General and administrative expenses increased by
approximately $6,000 due to increased professional fees.Other income for the three months ended March 31, 2004 was approximately
$8,000, compared to approximately $15,000 for the prior period. Other
income for the quarter ended March 31, 2004 is principally attributable
to the sale of an equipment lease for net cash proceeds of approximately
$142,000, and miscellaneous income from late charges of approximately
$5,000. Other income for the three months ended March 31, 2003 is
primarily due to a gain on the disposition of an equipment lease in
January 2003 and miscellaneous income from late charges of approximately
$8,000.As a result of the foregoing, the Partnerships net income from
continuing operations decreased 9.2% to approximately $229,000 for the
three months ended March 31, 2004, as compared to approximately $252,000
for the three months ended March 31, 2003.Discontinued Operations in the first quarter of 2003 reflect the result
of the Red Robin property that was sold in the third quarter of 2003.
The sale was triggered by the tenants exercise of a purchase option
clause in the lease agreement.As a result of the foregoing, the Partnerships net income decreased
22.3% to approximately $229,000 for the three months ended March 31,
2004, as compared to approximately $294,000 for the three months ended
March 31, 2003.The Partnership announced first quarter distributions of $421,691, of
which $374,506 was distributed to its limited partners on April 15, 2004.
The balance of $47,185 was distributed to limited partners who elected
to receive distributions on a monthly basis on February 13, 2004 and
March 15, 2004.LIQUIDITY AND CAPITAL COMMITMENTSThe Partnership commenced the Offering of up to 20,000 Units, priced at
$1,000 per Unit, on August 12, 1994. The Partnership accepted
subscriptions for the minimum number of Units on January 24, 1995, and
immediately commenced operations. The Offering reached final funding on
August 12, 1996, having received subscriptions for the entire 20,000
Units and funds totaling $20,000,000. Net proceeds after Offering
expenses were $17.4 million.In November 1998, the Partnership entered into a $6.2 million note. The
Partnership entered into an additional $2.0 million note in March 1999.
Proceeds from the notes were used to acquire additional properties and
equipment. The notes each have a 10-year term, are collateralized by 10




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certain properties subject to operating leases, and bear interest at
rates of 8.37% and 8.50% per annum, respectively. In September 2003, the
Partnership defeased approximately $1,979,000 of these notes payable with
proceeds from the sale of a Red Robin property. Debt issuance costs of
approximately $478,000 incurred in connection with the issuance of the
notes are being amortized over the life of the notes to interest expense
using the straight-line method, which is not materially different than
the interest rate method.As of March 31, 2004, the Partnership had invested $16.1 million in 13
net leased real estate properties and $943,000 in 4 performing equipment
leases. The remaining net investment in the Partnerships leased
equipment is $350,000, after cumulative principal collections of
$593,000. Inclusive of the above amount, the Partnership has received
approximately $3.3 million of aggregate principal collections on its
financing leases during the life of those investments. The Partnership
also has a net investment of approximately $13,000 in a repossessed
equipment package, net of an allowance for loss of approximately
$169,000. As of March 31, 2004, the Partnership has not made any
commitments to purchase additional properties or equipment, nor does it
intend to make any such commitments.The Partnership annually considers written requests to repurchase Units
pursuant to the terms of the repurchase plan set forth in the
Partnerships prospectus with respect to the Offering. Since 1997, a
total of 367 Units have been repurchased by the Partnership. The
Partnership expects to fund future Unit repurchases out of working
capital reserves and net sale or refinancing proceeds, but may also fund
such repurchases out of cash flow. The Partnership is not obligated to
accept Unit repurchase requests if the General Partner determines that
such purchases would impair the capital or operation of the Partnership
and the Partnership may suspend or cancel the Repurchase Plan at any time
in its sole discretion.The Partnership expects that only limited amounts of liquid assets will
be required for existing properties since its property and equipment
leases require tenants and lessees to pay all taxes and assessments,
maintenance and repairs and insurance premiums, including casualty
insurance thereby minimizing the Partnerships operating expenses and
capital requirements. The General Partner expects that the cash flow to
be generated by the Partnerships properties and equipment will provide
adequate liquidity and capital resources to pay operating expenses and
provide distributions to Limited Partners. 
  ITEM 3.Controls and Procedures  Mr. Beach acting in his capacity as the principal executive officer of
GP3 Asset Acquisition is ultimately responsible for the disclosure and
procedures of the Partnership. Disclosure controls and procedures are
established and maintained by the Partnership to ensure the information
required to be disclosed by the Partnership in the reports that it files
or submits pursuant to the Securities Exchange Act of 1934, as amended
(the Act), is recorded, processed, summarized and reported within the
time periods specified in the Commissions rules and forms. Mr. Beach
has evaluated the effectiveness of the Partnerships disclosure controls
and procedures as of the end of the period covered by the report, and has determined that these controls and procedures
effectively communicate the information required to be disclosed by the
Partnership in the report it files or submits under the Act in a manner
that allows timely decisions regarding such disclosures.There have been no significant changes in the Partnerships internal
controls or in other factors that could significantly affect these
controls subsequent to the evaluation date, including, but not limited
to, any corrective actions with regard to significant deficiencies and
material weaknesses. 11




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PART II  OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS.None. ITEM 2. CHANGES IN
SECURITIES AND SMALL BUSINESS ISSUER PURCHASES OF
EQUITY SECURITIES.None. ITEM 3. DEFAULTS UPON SENIOR SECURITIES.None. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.None. ITEM 5. OTHER INFORMATION.None ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.  (a)
    
    The following exhibits are included herein or incorporated by
reference: Number
    
    Exhibit4
    
    
    Amended Agreement of Limited Partnership of Registrant.
(Incorporated by reference to the corresponding exhibit in the
Registrants Form 10-KSB for the year ended December 31, 1998)10.1
    
    
    Promissory Note dated November 28, 1998 between Registrant
and National Realty Funding L.C. (Incorporated by reference to the
corresponding exhibit in the Registrants Form 10-KSB for the year
ended December 31, 1998)10.2
    
    
    Promissory Note dated March 31, 1999 between Registrant and
National Realty Funding L.C. (Incorporated by reference to the
corresponding exhibit in the Registrants Form 10-QSB for the
quarter ended March 31, 1999)31
    
    
    Certification Pursuant to Section 302 of the Sarbanes-Oxley
Act of 200232
    
    
    Certification Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
  (b)
    
    Reports on Form 8-K:  There were no reports filed on Form 8-K for the quarter ended March 31,
2004. 12




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SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized. By:
    
    Captec Franchise Capital Partners L.P. IIIGP3 Asset Acquisition, LLCIts ManagerBy:
    
    /s/ Patrick L. BeachPatrick L. BeachPresidentDate:
    
    May 14, 2004
 13




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EXHIBIT INDEX Number
    
    Exhibit4
    
    
    Amended Agreement of Limited Partnership of Registrant.
(Incorporated by reference to the corresponding exhibit in the
Registrants Form 10-KSB for the year ended December 31, 1998)10.1
    
    
    Promissory Note dated November 28, 1998 between Registrant
and National Realty Funding L.C. (Incorporated by reference to the
corresponding exhibit in the Registrants Form 10-KSB for the year
ended December 31, 1998)10.2
    
    
    Promissory Note dated March 31, 1999 between Registrant and
National Realty Funding L.C. (Incorporated by reference to the
corresponding exhibit in the Registrants Form 10-QSB for the
quarter ended March 31, 1999)31
    
    
    Certification Pursuant to Section 302 of the Sarbanes-Oxley
Act of 200232
    
    
    Certification Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 14