INDEPENDENCE TAX CREDIT PLUS L.P.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
May 28, 1997
Personal and Confidential
-------------------------
Related Independence Associates L.P.
Lehigh Tax Credit Partners L.L.C.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Gentlemen:
As you requested, the purpose of this letter is to set forth our
understanding with regard to any proposed acquisition of beneficial assignment
certificates ("BACs") of Independence Tax Credit Plus L.P., a Delaware limited
partnership (the "Partnership"), from holders of BACs (each a "BACs holder"
and collectively, "BACs holders") by Related Independence Associates L.P.
("RIA"), Lehigh Tax Credit Partners L.L.C. ("Lehigh") or any person who is
their Affiliate (as defined below) (collectively, "you").
In response to your proposal to commence a tender offer for BACs and
in consideration of the agreements set forth in this letter agreement, the
Partnership agrees to mail your tender offer materials, at your expense,
subject to the terms set forth below and whether or not such tender offer is
subject to the provisions of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"). Nothing in this letter agreement shall be construed as
requiring the Partnership to provide you with a current list of the names and
addresses of the BACs holders. The Partnership will not be obligated to mail
your tender offer materials until it has received from you an amount of cash
equal to $10,000, representing the estimated cost of such mailing together
with the Partnership's other expenses, including, without limitation,
reasonable attorney fees.
You represent and warrant that on the date hereof you beneficially
own not more than one hundred and twenty-one (121) BACs. You also agree that
prior to the tenth anniversary of the date of this letter agreement, neither
you nor any person who is your Affiliate (as defined under Rule 405 of the
Securities Act of 1933, as amended) will, without the prior written consent of
the Partnership, which may be withheld for any reason, directly or indirectly,
(i) seek or propose to enter into, directly or indirectly, any merger,
consolidation, business combination, sale or acquisition of assets,
liquidation, dissolution or other similar transaction involving the
Partnership, (ii) form, join or otherwise participate in a "group" (within the
meaning of Section 13(d)(3) of the Exchange Act) with respect to any voting
securities of the Partnership, except that those Affiliates bound by this
letter agreement will not be deemed to have violated this letter agreement and
formed a "group" solely by acting in accordance with this letter agreement,
(iii) disclose in writing to any third party any intention, plan or
arrangement inconsistent with the terms of this letter agreement or (iv) loan
money to, advise, assist or encourage any person in connection with any action
inconsistent with the terms of this letter agreement. Notwithstanding the
foregoing restrictions, nothing in this letter agreement
shall apply to, govern, restrict or limit any sales, purchases, transfers or
assignments of interests in Lehigh.
You hereby represent, warrant and covenant to the Partnership that
any tender offer to purchase BACs commenced by you will be conducted in
compliance with Section 14(e) (misleading statements), Rule 14d-7 (additional
withdrawal rights), Rule 14d-8 (pro rata requirements), Rule 14e-1 (unlawful
tender offer practices) and Rule 14e-3 (non-public information) of the
Exchange Act, notwithstanding that such tender offer may be for less than 5.0%
of the outstanding BACs.
You understand that the general partner of the Partnership may
consider from time to time selling all or substantially all of the assets of
the Partnership or entering into any other transaction determined by the
general partner to be in the best interests of the BACs holders and the
Partnership. The result of any such transaction, if approved by a majority
vote of the BACs holders, might be the dissolution and liquidation of the
Partnership in accordance with the partnership agreement. Accordingly, in
order to avoid disrupting any possible sale of all or substantially all of the
Partnership's assets or any other transaction determined by the general
partner to be in the best interests of the BACs holders and the Partnership
and any required vote of BACs holders, you agree that, prior to the ten-year
anniversary of the date of this letter agreement, all BACs obtained by you
pursuant to any means will be voted by you on all issues in the same manner as
by the majority of all other BACs holders who vote on such proposal.
Notwithstanding the foregoing, you may vote all BACs in the manner you
determine, in your sole and absolute discretion, on proposals (i) concerning
the removal of XXX as general partner of the Partnership or (ii) seeking to
reduce any fees, profits, distributions or allocations attributable to RIA or
its Affiliates.
If at any time during such ten year period you (excluding your
affiliate which serves as the general partner of the Partnership while acting
in its capacity as general partner) are contacted in writing by any third
party concerning participation in any transaction involving the assets,
businesses or securities of the Partnership or involving any action
inconsistent with the terms of this letter agreement, you will promptly
forward a copy of such writing to the Partnership and you may inform such
third party that this letter agreement requires you to so notify the
Partnership, provided, however, this paragraph shall not apply to any
transaction or proposed transaction involving all or substantially all of the
assets, businesses or securities of Related Capital Company and/or its
Affiliates (other than the Partnership and RIA).
Nothing in this letter agreement shall apply to, govern, restrict
or limit any sales, purchases, transfers or assignments of interests in
Lehigh. Notwithstanding the immediately preceding sentence, Lehigh shall
remain bound by this letter agreement notwithstanding that any interests in
Lehigh have been sold, purchased, transferred or assigned.
Lehigh, RIA and Related Capital Company agree to indemnify and hold
harmless, to the fullest extent permitted by law, the Partnership,
Independence SLP L.P., and each of their partners, directors, officers,
employees, representatives and agents (the "Indemnified Parties") against any
losses, claims, damages, liabilities, costs, expenses (including reasonable
attorney's fees and expenses in advance of the final disposition of any claim,
suit, proceeding or investigation to each Indemnified Party to the fullest
extent permitted by law), judgments, fines and amounts (collectively,
"Damages") paid in connection with any threatened or actual claim, action,
suit, proceeding or investigation which arises out of or is the result of a
breach of this letter agreement, any tender offer commenced by you (regardless
of whether such tender offer is subject to the provisions of the Exchange Act)
or the actual
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or proposed acquisition of BACs by you by any other means; provided, however,
that if such claim, action, suit, proceeding or investigation is threatened
but not actual, your obligation to indemnify the Indemnified Parties shall
apply only if such threat is in writing and only with respect to any legal
fees incurred in connection with such threat. If such threat becomes an actual
claim, action, suit, proceeding or investigation, you shall then be
responsible for the full indemnification provided for in this paragraph. If an
Indemnified Party intends to seek indemnification pursuant to this paragraph,
it shall promptly notify you of such claim, in writing, describing such claim
in reasonable detail; provided, that the failure to provide such notice shall
not affect your obligations herein unless you are materially prejudiced by the
failure to provide such notice. Counsel for the Indemnified Party shall be
chosen at your discretion and shall be directed by you. We both agree that you
will be materially prejudiced if, due to the failure of an Indemnified Party
to provide the notice required above, you were not given the opportunity to
obtain the counsel of your choice or direct such counsel. You may participate
at your own expense in the defense of any such action; provided, that counsel
for the Indemnified Party shall not (except with the consent of the
Indemnified Party) also serve as your counsel. You shall not, without first
obtaining a general release from liability for the Indemnified Parties in a
form satisfactory to such Indemnified Parties, settle or compromise or consent
to the entry of any judgment with respect to any threatened or actual claim,
action, suit, proceeding or investigation involving an Indemnified Party which
seeks indemnity under this paragraph. If the indemnification provided in this
paragraph is for any reason unavailable to or insufficient to hold harmless an
Indemnified Party in respect of any Damages referred to above, then you and
each party seeking indemnification shall contribute to the aggregate amount of
such Damages incurred by such Indemnified Party in such proportion as is
appropriate to reflect the relative benefits received by each party from the
act which gives rise to the indemnification claim. You agree that the amount
of such economic benefit received by each Indemnified Party shall be $1 and
the amount of such economic benefit received by you shall be computed by
multiplying your per BAC offer price by the total number of BACs which were
sought in your tender offer. Both you and the Indemnified Parties each hereby
agree to cooperate fully in all aspects of any investigation, defense,
pre-trial activities, trial, compromise, settlement or discharge of any claim
in respect of which indemnity is sought pursuant to this paragraph, including,
but not limited to, by providing the other party reasonable access upon
reasonable notice to employees and officers and other information during
reasonable business hours. Nothing in this paragraph is intended to limit your
ability to obtain indemnification from the Partnership if such indemnification
is available to you pursuant to the Partnership's partnership agreement and
applicable law, provided, however, that your obligations herein shall not be
affected by your ability or inability to obtain such indemnification. We each
hereby agree that the provisions of this paragraph shall have no effect on any
other partnership which you or any of our respective Affiliates may be a
partner.
Notwithstanding the immediately preceding paragraph, we acknowledge
that you may engage a third party lender(s) to finance your proposed
acquisition of BACs. We hereby acknowledge and agree for the benefit of such
third party lender(s) that the indemnification provisions in the immediately
preceding paragraph are not intended to apply to or obligate, and in no event
shall be binding upon, such third party lender(s) or any of its assigns or
successors in interest to any of the BACs acquired by you.
We each hereby acknowledge that we are aware, and that we will
advise our respective Affiliates of our respective responsibilities under the
securities laws. We each agree that the other of us or our respective
Affiliates, as the case may be, shall be entitled to equitable relief,
including
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injunctive relief and specific performance, in the event of any breach of the
provisions of this letter agreement, in addition to all other remedies available
at law or in equity.
In case any provision in or obligation under this letter agreement
shall be invalid, illegal or unenforceable in any jurisdiction, the validity,
legality and enforceability of the remaining provisions or obligations, or of
such provision or obligation in any other jurisdiction, shall not in any way
be affected or impaired thereby.
This letter agreement shall be governed by the laws of the State of
New York without giving effect to principles of conflicts of law thereof. This
letter agreement may be executed in counterparts, each of which shall be
deemed an original, but all of which together constitute one and the same
instrument.
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If you agree with the foregoing, please sign and return two copies
of this letter agreement, which will constitute our agreement with respect to
the subject matter of this letter agreement.
Very truly yours,
INDEPENDENCE TAX CREDIT PLUS L.P.
By: Related Independence Associates L.P., its general
partner
By: Related Independence Associates Inc., its general
partner
By: /s/ X. Xxxxxxx Xxxxx
------------------------------------
Name: X. Xxxxxxx Xxxxx
Title: President
Confirmed and agreed to as of
the date first above written
LEHIGH TAX CREDIT PARTNERS L.L.C.
By: Lehigh Tax Credit Partners, Inc.,
its managing member
By: /s/ Xxxx X. Xxxxxx
--------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
RELATED INDEPENDENCE ASSOCIATES L.P.
By: Related Independence Associates Inc.,
its general partner
By: /s/ Xxxx X. Xxxxxx
--------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
