GregS has an early m104 - it's in a 1990 300CE. Early m104 engines included an oil-to-water oil cooler. The third pipe is the return from the oil cooler. This was eliminated on later versions of the engine. If you look up the water pump for these cars, you'll see two versions, one for cars with the oil cooler, one for cars without. You have to know the engine number in your car to purchase the correct water pump.