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SETTLEMENT AGREEMENT AND RELEASE
This Settlement Agreement and Release (this
"Agreement") is made and entered into as of the 27th day of June,
1996, by and between The ▇▇▇▇▇ Corporation ("▇▇▇▇▇"), a
Massachusetts corporation with a principal place of business at
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and Liquidity
Financial Group, L.P. ("Liquidity") individually and on behalf of
certain Affiliates as hereinafter defined, a California limited
partnership with a principal place of business at ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
W I T N E S S E T H:
WHEREAS, Liquidity is engaged in the business of
sponsoring and managing funds which invest in, among other
things, real estate limited partnerships;
WHEREAS, ▇▇▇▇▇ and certain affiliates sponsored and are
engaged in the business of managing, among other things, real
estate limited partnerships;
WHEREAS, Liquidity sponsored and manages Liquidity
Funds #33 LP as well as other investment funds, and may in the
future sponsor and manager and or provide investment advice to
additional investment funds (collectively, the "Liquidity
Funds"), and ▇▇▇▇▇ sponsored and manages ▇▇▇▇▇ Realty Fund, Ltd.-III
("Realty III") and ▇▇▇▇▇ Realty Limited Partnership-V ("Realty
V") as well as other investment funds, and may in the future
sponsor or manage additional investment funds (individually a
"▇▇▇▇▇ Fund") and collectively, the "▇▇▇▇▇ Funds");
WHEREAS, Liquidity has, on behalf of certain of the
Liquidity Funds, sought to obtain from ▇▇▇▇▇ lists of the
investors in certain of the ▇▇▇▇▇ Funds for the stated purpose of
contacting such investors in order to attempt to acquire their
units in the ▇▇▇▇▇ Funds;
WHEREAS, ▇▇▇▇▇ has refused to provide lists of the
investors to Liquidity, alleging that they are not entitled to
obtain such lists and Liquidity has stated that, absent a
satisfactory resolution, its present intention is to litigate the
issue;
WHEREAS, the parties have conferred through their
respective counsel and are desirous of resolving and settling
Liquidity's claims, upon the terms and conditions hereinafter set
forth.
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NOW, THEREFORE, for good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the
parties hereto hereby agree as follows:
1. Delivery of Lists: Within ten business days of
the date of this Agreement, ▇▇▇▇▇ will deliver to Liquidity lists
of investors (containing the names, Addresses and capital
contributions of such investors) in Realty III and Realty V. The
lists will be sorted alphabetically and delivered in both paper
format and on 3.5" IBM Compatible computer diskette in ASCII
format. Any additional lists delivered pursuant to paragraph 3
below will also be delivered in both paper format on 3.5" IBM
Compatible computer diskette in ASCII format.
2. Payment for Lists: Within ten business days of the
date of this Agreement, Liquidity will deliver to ▇▇▇▇▇ payment
for the estimated cost of reproducing and delivering such lists
in the total amount of $600.00.
3. Provision of Additional Lists: From time to time
during the twelve month period commencing on the date hereof and
expiring on the first anniversary date of this Agreement, ▇▇▇▇▇
will, upon written request from Liquidity, deliver to Liquidity
within 15 business days of receipt of such written request,
updated lists of investors in Realty III and Realty V, or, to the
extent a Liquidity Fund is a Limited Partner or Shareholder (as
the case may be) in any other ▇▇▇▇▇ Fund, current lists of
investors in such other ▇▇▇▇▇ Fund, provided such request
includes an undertaking by Liquidity to pay the cost of
reproducing and delivering such lists within 10 business days
after receipt of such lists.
4. Restrictions on Activities: For a period
commencing on the date hereof and continuing for 30 months from
the last date an investor list in a ▇▇▇▇▇ Fund is delivered to
Liquidity in response to Liquidity's request, Liquidity and any
person or entity controlling, controlled, managed or advised by
Liquidity or its subsidiaries (including the Liquidity Funds) or
under common control with Liquidity ("Liquidity Affiliate") shall
not, without the prior written consent of ▇▇▇▇▇, which may be
granted or withheld in ▇▇▇▇▇'▇ sole and exclusive discretion and
for any reason, or no reason:
(a) vote its interests in any ▇▇▇▇▇ Fund on any
issue other than in proportion to the votes of all other interest
holders who vote on such issue;
(b) in any manner acquire, attempt to acquire, or
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make a proposal to acquire, directly or indirectly, more than a
25% interest in any ▇▇▇▇▇ Fund;
(c) propose, or propose to enter into, directly
or indirectly, any merger, consolidation, business combination,
sale or acquisition or assets, liquidation or other similar
transaction involving any ▇▇▇▇▇ Fund;
(d) form, join or otherwise participate in a
"group" within the meaning of Section 13(d) of the Securities and
Exchange Act of 1934, as amended, with respect any voting
securities of a ▇▇▇▇▇ Fund;
(e) make or participate in any way, directly or
indirectly, in any solicitation of "proxies" or "consents" (as
such terms are used in the proxy rules of the Securities and
Exchange Commission) to vote, or seek to advise or influence any
person with respect to the voting of any voting securities of any
▇▇▇▇▇ Fund;
(f) sell, transfer or assign any interests in any
▇▇▇▇▇ Fund to any person or entity not bound by the terms and
conditions of this Agreement;
(g) disclose any intention, plan or arrangement
inconsistent with the terms of this Agreement; and
(h) loan money to, advise, assist or encourage
any person in connection with any of the actions restricted or
prohibited by this Agreement.
5. Use of Lists, Prohibition on Furnishing to Others:
Any investor list obtained in Liquidity or Liquidity Affiliates
relative to any ▇▇▇▇▇ Fund will be utilized only for the purpose
of contacting investors to inquire as to whether they wish to
sell their units in such ▇▇▇▇▇ Fund to a Liquidity Fund, and for
no other purpose. The lists will not be furnished by Liquidity
or Liquidity Affiliate to any other person or entity.
6. Third Parties: If at any time Liquidity or
Liquidity Affiliate in approached or contacted by any third party
concerning participation in a transaction involving the assets,
businesses or securities of any ▇▇▇▇▇ Fund or involving any of
the actions proscribed in Section 4 hereof or otherwise by this
Agreement, Liquidity or Liquidity Affiliates, as the case may be,
will immediately notify such party of its inability to
participate in such a transaction and, its obligation to notify
▇▇▇▇▇ and will thereafter promptly (and in any event, within 5
business days) notify ▇▇▇▇▇ of the nature of such contact and the
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parties thereto. ▇▇▇▇▇ will indemnity, defend and hold harmless
Liquidity and the Liquidity Affiliates from and against any and
all claims, demands or liabilities that may arise as a result of
Liquidity's or any Liquidity Affiliates' strict compliance with
the terms of this paragraph.
7. Compliance with Securities and Other Laws:
Liquidity and Liquidity Affiliates acknowledge their obligations
under the Securities Laws and Rules of the Securities and
Exchange Commission.
8. Provision of Copies of All Communications:
Liquidity and Liquidity Affiliates covenant and agree that they
shall deliver to ▇▇▇▇▇ at least 5 business days before mailing or
otherwise distributing to investors in any ▇▇▇▇▇ Fund any
communication to be given to one or more investors in any ▇▇▇▇▇
Fund.
9. Fiduciary Duties of ▇▇▇▇▇; Safe Harbor Provision,
Protection of Partnership Status: Liquidity acknowledges that:
(a) ▇▇▇▇▇ and its affiliates have significant
fiduciary obligations to the investors in the ▇▇▇▇▇ Funds, and
has stated that it is entering into this Agreement to, among
other things, fulfill those fiduciary obligations;
(b) ▇▇▇▇▇ may need to take certain further action
to meet its fiduciary obligations, including, without limitation,
suspending the acceptance of transfer paperwork in one or more
▇▇▇▇▇ Funds to avoid the termination of such ▇▇▇▇▇ Fund's status
as a partnership under the Internal Revenue Code of 1986 (the
"Code"), as amended; avoid the treatment or such ▇▇▇▇▇ Fund as a
Publicly Traded Partnership under the Code; or cause the ▇▇▇▇▇
Fund to fall outside any so-called "Safe Harbor" provision
relating to taxation or tax status, including provisions relating
to Publicly Traded Partnerships; and
(c) That the suspension of the acceptance of
transfer paperwork by ▇▇▇▇▇ would mean that, notwithstanding the
presentment of valid transfer paperwork an the terms of this
Agreement, transfers requested by Liquidity or a Liquidity
Affiliate would not be processed nor reflected on the books and
records of the ▇▇▇▇▇ Fund.
Nothing herein shall be construed, however, as an
acknowledgment or agreement by Liquidity that ▇▇▇▇▇ has the right
under any particular circumstances to suspend the acceptance of
transfer paperwork, or as a waiver of any future claims of
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Liquidity arising out of any such suspension or other similar
action.
10. Release: For and in consideration of the
agreements herein made, Liquidity, individually and on behalf of
the Liquidity Affiliates, does hereby remise, release and acquit
▇▇▇▇▇ and all of its partners, officers, directors, affiliated,
predecessors, successors and assigns from and against any and all
claims, damages, costs, expenses, actions and causes or action
which Liquidity and the Liquidity Affiliates (including their
partners, officers, directors, affiliates, predecessors,
successors and assigns) and in the past, now has, or may in the
future acquire arising from or related to the failure or refusal
of ▇▇▇▇▇ to provide an investor list of any ▇▇▇▇▇ Fund, except
for such a failure or refusal in violation of the provisions of
this Agreement.
11. Notices: Any and all notices required or permitted
hereunder shall be in writing and shall be deemed given or
served, as the case may be, upon actual delivery to the parties
at the following addresses:
If to Liquidity: Liquidity Financial Group, L.P.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
with a copy to: ▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
▇▇▇▇▇▇ & ▇▇▇▇▇
Embarcadero Center West Tower
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
If to ▇▇▇▇▇: The ▇▇▇▇▇ Corporation
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
with a copy to: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Vice President and General Counsel
The Berkshire Group
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
12. No Admissions, Confidentiality: The parties agree
that this Agreement is being entered into solely to settle
disputed claims, and nothing herein shall be deemed to constitute
an admission of liability on the part of ▇▇▇▇▇, all such
liability being expressly contested. The parties agree that
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their discussions prior to entering into this Agreement, the
nature, existence and terms of this Agreement, and all matters
relating to the dispute and settlement shall be strictly
confidential and not disclosed by either party to any individual
or entity, nor be admissible in court for any purpose.
Notwithstanding the foregoing, should either party believe that
it must produce this Agreement in response to subpoena or other
lawful process, it shall first notify the other party and provide
the other party with at least 15 business days in which to seek
to quash or limit any such subpoena or process, before producing
this Agreement. To the extent the second party does not have
standing to seek to quash or limit the subpoena, the first party
shall cooperate in such efforts, provided such cooperation does
not result in the incurring of any costs of the part of said
first party.
13. Enforcement: The parties agree that each shall be
entitled to equitable relief, including injunctive relief and
specific performance, in the event of any breach of the
provisions of this Agreement, in addition to all other remedies
available at law or in equity. In the event either party must
refer this agreement to as attorney for enforcement, the
prevailing party shall be entitled to all costs of enforcement,
including attorneys' fees.
14. Governing Law' Venue and Jurisdiction: This
Agreement shall be governed by the laws of the Commonwealth of
Massachusetts without regard to principles of conflict of law
thereof. The parties agree that the Federal and state courts
located within the Commonwealth of Massachusetts shall have
exclusive jurisdiction over disputes arising hereunder, and the
parties hereby consent to such venue and submit to the
jurisdiction of such courts.
15. Captions: Captions and section headings used
herein are for convenience of reference only, are not part of
this Agreement and are not to affect the construction of, or to
be taken into consideration in interpreting, this Agreement.
16. Amendments: This Agreement may be amended,
changed, modified, altered or terminated only by written
instrument or written instruments signed by all of the parties
hereto.
17. Severability: In the event any provision of this
Agreement shall be held invalid or unenforceable by any court or
competent jurisdiction, such holding shall not invalidate or
render unenforceable any other provision hereof.
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IN WITNESS WHEREOF, the parties have executed this
Agreement under seal as of the date first above written.
LIQUIDITY FINANCIAL GROUP, L.P.
By: Liquidity Financial Corporation,
its general partner
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
President
THE ▇▇▇▇▇ CORPORATION
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
President
