[Execution Copy]
VOTING AGREEMENT
among
EQUITY RESOURCE BRATTLE FUND LIMITED PARTNERSHIP,
EQUITY RESOURCE CAMBRIDGE FUND LIMITED PARTNERSHIP,
EQUITY RESOURCE GENERAL FUND LIMITED PARTNERSHIP,
EQUITY RESOURCE FUND XVI LIMITED PARTNERSHIP,
EQUITY RESOURCE FUND XIX LIMITED PARTNERSHIP
EQUITY RESOURCE BRIDGE FUND LIMITED PARTNERSHIP
KRF COMPANY, L.L.C.,
and
KRF3 ACQUISITION COMPANY, L.L.C.
------------------------------
Dated as of January 6, 2000
------------------------------
[Execution Copy]
VOTING AGREEMENT
VOTING AGREEMENT, dated as of January 6, 2000 (this "Agreement"), by
and among KRF Company, L.L.C., a Delaware limited liability company
("Berkshire"), KRF3 Acquisition Company, L.L.C., a Delaware limited liability
company (the "Company"), and certain investment funds affiliated with Equity
Resources Group Incorporated (collectively referred to as "Equity Resources"),
listed on Schedule I hereto (each, a "Unitholder" and, collectively, the
"Unitholders").
WHEREAS, the Company, Berkshire and Equity Resources propose to enter
into an Investment Agreement, dated as of the date hereof (the "Investment
Agreement") which contemplates, among other things, (i) the investment by each
of Berkshire and Equity Resources in the Company; and (ii) the merger of the
Company with ▇▇▇▇▇ Realty Fund, Ltd.-III with and into the Company, a
Massachusetts limited partnership (the "Partnership") (the "Merger") pursuant to
a Merger Agreement (the "Merger Agreement") substantially in the form attached
as Exhibit C to the Investment Agreement; and (iii) the amendment of the Amended
Agreement of Limited Partnership of the Partnership, dated as of June 1, 1982,
as amended from time to time (the "Fund III Agreement") to permit the Company to
enter into the Merger Agreement and consummate the transactions contemplated
thereby (the "Amendment").
WHEREAS, as of the date hereof, the Unitholders are holders of record
or Beneficially Own (as defined herein) an aggregate amount of 1,524 limited
partnership units of the Partnership listed opposite the name of each such
Unitholder on Schedule I hereto; and
WHEREAS, in order to induce Berkshire and the Company to enter into the
Investment Agreement, each Unitholder has agreed to enter into this Agreement
with respect to all of the investor limited partnership interests of the
Partnership now held of record or Beneficially Owned and which may hereafter be
acquired by such Unitholders (the "Units").
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements contained herein, and intending to be legally bound
hereby, the parties hereto hereby agree as follows:
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ARTICLE I
CERTAIN DEFINITIONS
Section 1.1 General. Capitalized terms used and not defined herein have
the respective meanings ascribed to them in the Investment Agreement.
Section 1.2 Beneficial Ownership. For purposes of this Agreement,
"Beneficially Own" or "Beneficial Ownership" with respect to any securities
shall mean "beneficial ownership" of such securities (as determined pursuant to
Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the "Exchange
Act")), including pursuant to any agreement, arrangement or understanding,
whether or not in writing.
ARTICLE II
Section 2.1 Voting Agreement. Each of the Unitholders hereby agrees as
follows:
(a) to appear, or cause the holder of record on any applicable
record date with respect to any Units owned by such Unitholder to
appear, in person or by proxy, for the purpose of obtaining a quorum at
any annual or special meeting of the partners of the Partnership and at
any adjournment thereof, at which matters relating to the Merger, the
Amendment or any transaction contemplated thereby are considered; and
(b) at any meeting of the partners of the Partnership, however
called, and in any action by consent of the limited partners of the
Partnership, to vote, or cause to be voted by the Unitholders, in
person or by proxy, the Units held of record or Beneficially Owned by
such Unitholder in favor of the Merger, the Merger Agreement (as
amended from time to time), the Amendment and the transactions
contemplated by the Merger Agreement; and
(c) at any meeting of the Partners of the Partnership, however
called, and in any action by consent of the limited partners of the
Partnership, to vote, or cause to be voted by the Unitholders, in
person or by proxy, the Units held of record or Beneficially Owned by
such Unitholder against approval of any proposal made in opposition to
or in competition with the Merger or any of the other transactions
contemplated by the Merger Agreement, and any other action that may
reasonably be expected to impede, interfere with, delay, postpone or
attempt to discourage the Merger or the other transactions contemplated
by the Merger Agreement which would
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materially and adversely affect the Partnership or its ability to
consummate the transactions contemplated by the Merger Agreement.
Section 2.2 No Ownership Interest. Nothing contained in this Voting
Agreement shall be deemed to vest in the Company or Berkshire any direct or
indirect ownership or incidence of ownership of or with respect to any Units.
All rights, ownership and economic benefits of and relating to the Units shall
remain and belong to the Unitholders.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE UNITHOLDERS
Each of the Unitholders hereby represents and warrants, severally and
not jointly, to the Company and Berkshire as follows:
Section 3.1 Authority Relative to This Agreement. Such Unitholder has
all necessary power and authority to execute and deliver this Agreement, to
perform its obligations hereunder and to consummate the transactions
contemplated hereby. Where such Unitholder is a corporation, partnership or
other entity, the execution and delivery of this Agreement by such Unitholder
and the consummation by such Unitholder of the transactions contemplated hereby
have been duly and validly authorized by the board of directors or other
governing body of such Unitholder, and no other proceedings on the part of such
Unitholder are necessary to authorize this Agreement or to consummate such
transactions. This Agreement has been duly and validly executed and delivered by
such Unitholder and constitutes a legal, valid and binding obligation of such
Unitholder, enforceable against such Unitholder in accordance with its terms,
except to the extent enforceability may be limited by bankruptcy, insolvency,
moratorium or other similar laws affecting creditors' rights generally or by
general principles governing the availability of equitable remedies.
Section 3.2 No Conflict. (a) The execution and delivery of this
Agreement by such Unitholder does not, and the performance of this Agreement by
such Unitholder shall not, (i) where such Unitholder is a corporation,
partnership or other entity, conflict with or violate the organizational
documents of such Unitholder, (ii) conflict with or violate any agreement,
arrangement, law, rule, regulation, order, judgment or decree to which such
Unitholder is a party or by which such Unitholder (or the Units held of record
or Beneficially Owned by such Unitholder) is bound or affected or (iii) result
in any breach of or constitute a default (or an event that with notice or lapse
or time or both would become a default) under, or give to others any rights of
termination, amendment, acceleration or cancellation of, or result in the
creation of a lien or encumbrance on any of the Units held of record or
Beneficially Owned by such Unitholder pursuant to any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit, franchise or other
instrument or obligation to which
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such Unitholder is a party or by which such Unitholder (or the Units held of
record or Beneficially Owned by such Unitholder) is bound or affected, except,
in the case of clauses (ii) and (iii) of this Section 3.2, for any such
conflicts, violations, breaches, defaults or other occurrences which would not
prevent the performance by such Unitholder of its material obligations under
this Agreement.
(b) The execution and delivery of this Agreement by such
Unitholder does not, and the performance of this Agreement by such Unitholder
shall not, require any consent, approval, authorization or permit of, or filing
with or notification to, any governmental entity except for applicable
requirements, if any, of federal or state securities and antitrust laws and
except where the failure to obtain such consents, approvals, authorizations or
permits, or to make such filings or notifications, would not prevent the
performance by such Unitholder of its material obligations under this Agreement.
Section 3.3 Title to the Units. As of the date hereof, such Unitholder
is the record or Beneficial Owner of the Units listed opposite the name of such
Unitholder on Schedule I hereto. The Units listed opposite the name of such
Unitholder on Schedule I hereto are all the securities of the Partnership either
held of record or Beneficially Owned by such Unitholder. Such Unitholder has not
appointed or granted any proxy, which appointment or grant is still effective,
with respect to the Units held of record or Beneficially Owned by such
Unitholder. The Units listed opposite the name of such Unitholder on Schedule I
hereto are owned free and clear of all security interests, liens, claims,
pledges, options, rights of first refusal, limitations on such Unitholder's
voting rights, charges and other encumbrances of any nature whatsoever other
than liens under applicable law.
ARTICLE IV
COVENANTS OF THE UNITHOLDER
Section 4.1 No Inconsistent Agreements. Each Unitholder hereby
represents, warrants, covenants and agrees that, except as contemplated by this
Agreement and the Investment Agreement, such Unitholder has not and shall not,
and will use its reasonable best efforts to not permit any Person under such
Unitholder's control to, enter into any voting agreement or grant a proxy or
power of attorney with respect to the Units held of record or Beneficially Owned
by such Unitholder which, in either case, is inconsistent with this Agreement.
Section 4.2 Transfer of Title. Each Unitholder hereby covenants and
agrees that such Unitholder will not, prior to the termination of this
Agreement, either directly or indirectly, offer or otherwise agree to sell,
assign, pledge, hypothecate, transfer, exchange, or dispose of any Units or
options, warrants or other convertible securities to acquire or purchase units
of the Partnership or any other securities or
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rights convertible into or exchangeable for units of the Partnership, owned
either directly or indirectly by such Unitholder or with respect to which such
Unitholder has the power of disposition, whether now or hereafter acquired,
without the prior written consent of the Company and Berkshire. Each Unitholder
hereby agrees and consents to the entry of stop transfer instructions by the
Partnership against the transfer of any Units inconsistent with the terms of
this Section 4.2.
ARTICLE V
MISCELLANEOUS
Section 5.1 Termination. This Agreement shall terminate unless extended
by agreement of each of the parties hereto on August 1, 2000. Upon such
termination, no party shall have any further obligations or liabilities
hereunder; provided, however, that nothing in this Agreement shall relieve any
party from liability for the breach of any of its representations, warranties,
covenants and agreements set forth in this Agreement prior to such termination.
Section 5.2 Additional Units. If, after the date hereof, a Unitholder
acquires the right to vote any additional partnership interests of the
Partnership (any such partnership interests shall be referred to herein as
"Additional Units"), the provisions of this Agreement applicable to the Units
shall be applicable to such Additional Units as if such Additional Units had
been Units held by the Unitholders as of the date hereof. The provisions of the
immediately preceding sentence shall be effective with respect to Additional
Units without action by any Person immediately upon the acquisition by a
Unitholder of the right to vote such Additional Units.
Section 5.3 Specific Performance. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement was
not performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in addition to any other
remedy at law or in equity.
Section 5.4 Entire Agreement. This Agreement and the Investment
Agreement constitute the entire agreement between Berkshire, the Company and the
Unitholders with respect to the subject matter hereof and supersedes all prior
agreements and understandings, both written and oral, between Berkshire, the
Company and the Unitholders with respect to the subject matter hereof; provided
that, to the extent not inconsistent with the terms hereof, the Settlement
Agreement and Release, dated as of July 17, 1995, among Equity Resources and the
parties named therein shall continue in full force and effect.
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Section 5.5 Amendment. This Agreement may not be amended except by an
instrument in writing signed by the parties hereto.
Section 5.6 Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule or law,
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of this Agreement is not affected in any manner materially adverse to
any party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereby shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible to the fullest extent permitted by applicable law
in a mutually acceptable manner in order that the terms of this Agreement remain
as originally contemplated.
Section 5.7 Notices. All notices and other communications given or made
pursuant hereto shall be in writing and shall be deemed to have been duly given
or made and shall be effective upon receipt, if delivered personally, upon
receipt of a transmission confirmation if sent by facsimile (with a confirming
copy sent by overnight courier) and on the next business day if sent by Federal
Express, United Parcel Service, Express Mail or other reputable overnight
courier to the parties at the following addresses (or at such other address for
a party as shall be specified by notice):
If to a Unitholder:
c/o Equity Resources Group, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ Dagbjartsson
with a copy to:
Holland & Knight, LLP
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
If to the Company or Berkshire, to:
c/o The Berkshire Group
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
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with copies to:
The Berkshire Group
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇, Weiss, Rifkind, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Section 5.8 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware applicable to
agreements made and to be performed entirely within such state without giving
effect to the provisions thereof relating to conflicts of law.
Section 5.9 Obligations of Unitholders. The obligations of the
Unitholders hereunder shall be "joint and several."
Section 5.10 Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be an original and all of which, when
taken together, shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their respective duly authorized persons on the date
first above written.
KRF3 ACQUISITION COMPANY, L.L.C.
By: KRF Company, L.L.C.,
its sole member
By: The ▇▇▇▇▇ Family Limited Partnership-94,
its sole member
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
-----------------
▇▇▇▇▇▇▇ ▇▇▇▇▇
General Partner
KRF COMPANY, L.L.C.
By: The ▇▇▇▇▇ Family Limited Partnership-94,
its sole member
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
-----------------
▇▇▇▇▇▇▇ ▇▇▇▇▇
General Partner
EQUITY RESOURCE BRATTLE FUND LIMITED PARTNERSHIP,
EQUITY RESOURCE CAMBRIDGE FUND LIMITED PARTNERSHIP
EQUITY RESOURCE GENERAL FUND LIMITED PARTNERSHIP,
EQUITY RESOURCE FUND XVI LIMITED PARTNERSHIP,
EQUITY RESOURCE FUND XIX LIMITED PARTNERSHIP,
EQUITY RESOURCE BRIDGE FUND LIMITED PARTNERSHIP
By: EQUITY RESOURCES GROUP, INCORPORATED,
as general partner of each of the foregoing
By: /s/ ▇▇▇▇▇▇ Dagbjartsson
-----------------------
▇▇▇▇▇▇ Dagbjartsson
Executive Vice President
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SCHEDULE I
Unitholder: Number of Units: Address:
---------- --------------- -------
Equity Resource Fund 916.00 c/o Equity Resources Group, Inc.
XVI Limited Partnership ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ Dagbjartsson
Equity Resource Fund 413.00 c/o Equity Resources Group, Inc.
XIX Limited Partnership ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ Dagbjartsson
Equity Resource General 40.00 c/o Equity Resources Group, Inc.
Fund Limited Partnership ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ Dagbjartsson
Equity Resource 95.00 c/o Equity Resources Group, Inc.
Cambridge Fund Limited ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ Dagbjartsson
Equity Resource Brattle 30.00 c/o Equity Resources Group, Inc.
Fund Limited Partnership ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ Dagbjartsson
Equity Resource Bridge 30.00 c/o Equity Resources Group, Inc.
Fund Limited Partnership ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ Dagbjartsson
