April 29, 1998
Global Capital Management, Inc.
000 Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx
Gentlemen:
This letter agreement confirms our mutual agreement to be bound by the
terms of this letter agreement, including the terms and conditions set forth
in Exhibit A annexed hereto and made a part hereof. This agreement is
intended to be legally binding and enforceable upon execution and delivery
hereof.
Each of the parties represents and warrants to the other that (1) it has
the right, power and authority to enter into this letter agreement and
perform its obligations hereunder, (2) upon the execution of this letter
agreement by each of the parties hereto, this letter agreement will
constitute the legal, valid and binding obligation of such party, enforceable
against such party in accordance with its terms, and (3) no consent or
approval of any third party or governmental agency or authority is required
for such party to execute and deliver this letter agreement or to perform its
obligations hereunder.
Each of the parties hereto agrees that the terms of this letter
agreement are confidential and may not be disclosed by any party hereto,
except as may be required by law and except to the principals and authorized
representatives of the parties hereto without the written consent of all of
the parties. Except as may be required by law, any public announcement
regarding this letter agreement or the transactions contemplated herein may
not be made by any party without the prior consent of all other parties
hereto. If public announcement or disclosure is required by law, the
disclosing party shall use reasonable efforts to consult with the other
party, and obtain the approval of the other party of the announcement and
disclosure to be made.
This letter agreement shall be governed by and interpreted in accordance
with the laws of the State of California, without regard to the conflicts of
law provisions thereof. Nothing herein shall be deemed to grant jurisdiction
to the State of California over any dispute concerning this letter agreement.
This letter agreement may be executed in separate counterparts, each of
which shall be deemed an original but all of which together shall constitute
one and the same instrument.
This letter agreement supersedes any and all prior agreements, written
or oral, by or among any of the parties hereto with respect to the subject
matter hereof and may not be amended or otherwise modified except in writing
signed by all of the parties hereto.
This letter agreement shall be binding upon the parties hereto and their
respective successors and assigns.
Any party may execute this letter agreement by transmitting a copy of
its signature by facsimile to the other parties. In such event the signing
party shall deliver an original of the signature page to each of the other
parties within one business day of signing and failure to so deliver such
originals shall result in the facsimile copy of that party's signature being
treated as an original.
Very truly yours,
EVEREST TAX CREDIT INVESTORS, LLC
By: Everest Properties II, LLC
Manager
By: /s/Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx, Executive Vice President
EVEREST PROPERTIES II, LLC
By: /s/Xxxxx X. Xxxxxx
-----------------------------------------
Xxxxx X. Xxxxxx, Executive Vice President
ACCEPTED AND AGREED TO AS
OF THE DATE FIRST ABOVE WRITTEN:
GLOBAL CAPITAL MANAGEMENT, INC.
By: /s/Xxxxxxx X. Xxxx
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Name: Xxxxxxx X. Xxxx
---------------------------
Title: Vice President
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VALLEY CREEK CAPITAL, LLC
By: Global Capital Management, Inc.
Manager
By: /s/Xxxxxxx X. Xxxx
-------------------------------
Name: Xxxxxxx X. Xxxx
---------------------------
Title: Vice President
---------------------------
EXHIBIT A
OPTION TO PURCHASE SECURITIES
VALLEY TENDER OFFERS
Valley Creek Capital, LLC ("Valley") has commenced and is continuing
tender offers (the "Existing Offers" or the "Tender Offers") to purchase
certain of the issued and outstanding Beneficial Assignment Certificates
("BACs") representing limited partnership interests in Boston Capital Tax
Credit Fund II Limited Partnership, Series 9 and 10, Boston Capital Tax
Credit Fund III Limited Partnership, Series 15, 17 and 19, and Boston Capital
Fund IV Limited Partnership, Series 20, 21, 23, 24 and 25 (collectively, the
"Valley Target Partnerships"). Valley filed Tender Offer Statements on
Schedule 14D-1 (the "Schedules 14D-1") with the Securities and Exchange
Commission (the "Commission") with respect to the Existing Offers, the cover
pages for which are attached hereto as Exhibit A-1. References herein to the
Existing Offers shall include any extensions to the Existing Offers and any
amendments to the Schedules 14D-1, but shall not include any subsequent
tender offers not integrated with the Existing Offers made by any party
hereto for BACs in the Valley Target Partnerships. The BACs and other
securities tendered pursuant to the Tender Offers are referred to herein as
"Tendered Securities".
OPTION TO PURCHASE SECURITIES; PAYMENT OF SECURITIES AND EXPENSES
Subject to the terms and conditions set forth below, Valley hereby
grants, or will cause to be granted, to Everest an option to purchase up to
25% of the securities tendered in each Existing Offer.
Upon the expiration of a Tender Offer which is subject to any of the
foregoing options, the party making such offer (hereinafter the bidding
party) shall provide written notice to the holder of the forgoing options
(hereinafter an option holder) of the amount of Tendered Securities accepted
by such bidding party pursuant to such Tender Offer. Within five business
days following the bidding party's notice to the option holder, the option
holder shall notify the bidding party in writing whether or not it elects to
exercise its option and to what extent. If the option holder fails to notify
the bidding party of the exercise of its option within such five business day
period, the option holder shall be deemed not to have exercised its option.
If such option is exercised, the option holder shall pay the bidding party,
by wire transfer, on the later of (a) three business days after the option
holder delivers written notice of its election to exercise, (b) one business
day after the bidding party has given notice to the option holder that the
bidding party will pay tendering security holders in accordance with the
terms of the Tender Offer (such notice to be given by the bidding party to
the option holder not more than one business day prior to the date of such
payment), (c) the date that the bidding party makes such payment and (d) two
business days after the date the bidding party provides the option
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holder with written confirmation of the transfer of the number of Tendered
Securities with respect to which the option holder exercised its option (the
"Option Securities") an amount equal to (i) the option securities multiplied
by the price per Tendered Security paid by the bidding party in the
applicable Tender Offer plus (ii) the option holder's share of the "Total
Expenses" (as defined below) for such applicable Tender Offer (see
"ALLOCATION OF EXPENSES" below). The bidding party will deliver (or will
cause to be delivered), concurrently with the receipt of such payment from
the option holder by the bidding party, a confirmation from the subject
partnership setting forth the number of Option Securities that will be
transferred to the option holder.
ALLOCATION OF EXPENSES
At the time of purchase of any Option Securities, the option holder
shall pay to the bidding party a portion of Total Expenses related to such
Tender Offer equal to the lesser of (a) $25,000 and (b) Total Expenses
multiplied by a fraction, the numerator of which is the number of Tendered
Securities purchased by the option holder and the denominator of which is the
total number of Tendered Securities purchased pursuant to the Tender Offer.
"Total Expenses" with respect to each Tender Offer means all third-party
out-of-pocket costs and expenses incurred by the bidding party, or its
affiliates (including attorneys fees and expenses in connection with the
preparation and filing of any Tender Offer documents, but excluding
litigation expenses) with respect to each Tender Offer, including, without
duplication, Commission filing fees, the out-of-pocket expenses of any person
for acting as the information agent/depositary for the Tender Offer, printing
and mailing expenses, and the out-of-pocket expenses of the general partners
of target partnerships which are paid for by the bidding party. Total
Expenses shall not include the costs of purchasing the Tendered Securities or
any non-third-party costs, including the overhead of the bidding party. Each
party will provide, upon the execution and delivery hereof, an estimate of
its costs and expenses incurred to date in connection with any Tender Offers
and shall provide, upon request, invoices or other appropriate evidence of
the incurrence of costs and expenses constituting Total Expenses hereunder.
Liabilities, costs, obligations and damages incurred by any party in
connection with any litigation or threatened litigation relating to, or
arising from, the Tender Offers ("Tender Offer Litigation") shall be borne by
the bidding party and not the option holder. The bidding party agrees to
indemnify and defend the option holder and its affiliates, officers,
directors, members, employees and agents from and against all liabilities,
costs, obligations and damages in connection with Tender Offer Litigation
except to the extent that the foregoing arise out of any misstatements or
intentional acts of the option holder.
STANDSTILL AGREEMENT
Everest covenants and agrees that neither it nor any person who is its
"Affiliate" (as defined under Rule 405 of the Securities Act of 1933, as
amended) will, directly or indirectly, make any offer or take any act which
is competitive with the Existing Offers. The parties hereto acknowledge and
agree that nothing in this agreement shall cause them
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to form, become, join or otherwise participate in a "group" (within the
meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended) with respect to any voting securities of any partnership which is
the target of a Tender Offer (the "Covered Partnerships"). The foregoing
restrictions shall continue in full force and effect from the date hereof
until the expiration of the Tender Offers which are the subject matter hereof.
CONDUCT OF TENDER OFFER(s)
All decisions relating to the conduct of the Tender Offers and the
acquisition and transfer of Tendered Securities pursuant thereto, including
without limitation any change in the terms or waiver of any of the conditions
thereof, shall be made solely by the bidding party. Notwithstanding the
foregoing, if requested by the option holder, the bidding party agrees to
consult with the bidding party prior to commencing a Tender Offer with regard
to the purchase price offered therein and prior to increasing the offered
price in any Tender Offer commenced prior to or after the date hereof.
COOPERATION
The parties shall cooperate and provide each other with such information
as may be necessary or desirable to disclose the transaction(s) contemplated
hereby in accordance with applicable securities laws and the rules and
regulations promulgated thereunder. Additionally, the bidding party agrees
to furnish to the option holder, promptly upon request, a report of
securities tendered in any pending Tender Offer.
NO OTHER CONTRACTS
Except as expressly set forth herein, there are no contracts,
arrangements, understandings or relationships between Everest, on the one
hand, and Valley or Global, on the other hand, with respect to the BACs or
the securities of any Covered Partnerships.
FURTHER ASSURANCES
Each of the parties agrees that it shall take, and will cause its
affiliates to take, whatever action or actions as are deemed by counsel to
any party hereto to be reasonably necessary, advisable or convenient from
time to time to effectuate the provisions or intent of this agreement, and to
that end, each party agrees that it will execute, acknowledge and deliver any
further instruments or documents as give force and effect to this letter
agreement or any of the provisions hereof, or to carry out the intent of this
letter agreement or any of the provisions hereof. Global hereby guarantees
full performance of this agreement by Valley, and its Affiliates. Everest
Properties II, LLC hereby guarantees full performance of this agreement by
Everest Tax Credit Investors, LLC and its Affiliates.
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REMEDIES
It is understood and agreed that monetary damages would be any
inadequate remedy for violation of this agreement, and in the case of an
actual breach by a party of the provisions hereof, any one or more of the
other parties shall be entitled to relief by way of injunction, specific
performance or other equitable relief. The prevailing party in any dispute
arising out of this letter agreement shall, in addition to any monetary
damages or equitable relief, be entitled to recover from the other party, the
prevailing party's attorney's fees and expenses (including the time of
personnel employed by Global or Everest) incurred in connection with such
dispute.
NOTICES
Any notice or other communication required or permitted hereunder shall
be in writing and shall be delivered personally, sent by facsimile
transmission or sent by reputable overnight courier, postage or other charges
prepaid. Any such notice shall be deemed given when so delivered personally,
or by facsimile transmission when confirmed electronically or, if sent by
overnight courier, one day after delivery to the courier, as follows:
If to Valley or Global, to:
Global Capital Management, Inc.
000 Xxxxxxx Xxxxxxx
Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
If to Everest, to:
Everest Properties
000 X. Xxx Xxxxxx
Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: X. Xxxxxx Xxxxxxx or Xxxxx X. Xxxxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
Any party may designate another address or person for receipt of notices
hereunder by notice given in accordance with this section to the other party.
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