UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 1)
KRUPP REALTY FUND, LTD. - III
(Name of Issuer)
UNITS OF INVESTOR LIMITED PARTNERSHIP INTERESTS
(Title of Class of Securities)
501128 10 2
(CUSIP Number)
Bonnie D. Podolsky, Esq.
Gordon Altman Butowsky Weitzen Shalov & Wein
114 West 47th Street, 20th Floor
New York, New York 10036
(212) 626-0800
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
January 31, 1997
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this Schedule
13D, and is filing this schedule because of Rule 13d-1(b)(3) or
(4), check the following box / /.
Check the following box if a fee is being paid with the statement //. (A fee
is not required only if the reporting person: (1) has a previous statement
on file reporting beneficial ownership of more than five percent of the class
of securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such
class.) (See Rule 13d-7).
NOTE: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are
to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section
of the Act but shall be subject to all other provisions of the Act (however,
see the Notes).
<PAGE>
SCHEDULE 13D - AMENDMENT NO. 1
This statement constitutes Amendment No. 1 to the Schedule 13D
filed with the Securities and Exchange Commission (the "Commission") on
February 10, 1997 (the "Original Filing" and as amended hereby, the "Schedule
13D")on behalf of American Holdings I, L.P., a Delaware limited partnership,
American Holdings I - GP, Inc., a Delaware corporation, American Property
Investors, Inc., a Delaware corporation, Longacre Corp., a Delaware
corporation and Carl C. Icahn (collectively, the "Reporting Persons").
Item 6. Contracts, Arrangements, Understandings or Relationships With
Respect to Securities of the Issuer
The third paragraph of Item 6 of the Original Filing is hereby
amended and restated as follows:
The discussion herein of the LFG Standstill Agreement, the
Assumption Agreement and the Krescent-AHI Agreement is subject to
and qualified in its entirety by reference to such agreements,
which are filed as exhibits to this Schedule 13D.
Item 7. Material to Be Filed as Exhibits
The documents listed below are filed as exhibits to this Schedule
13D:
(a)
Exhibit 1. Settlement Agreement and Release, dated June 27,
1996, between The Krupp Corporation and Liquidity
Financial Group, L.P.
(filed herewith)
Exhibit 2. First Amendment to Settlement Agreement and
Release, dated October 8, 1996, between The Krupp
Corporation and Liquidity Financial Group, L.P.
(filed herewith)
Exhibit 3. Second Amendment to Settlement Agreement, dated
January 6, 1997, between The Krupp Corporation and
Liquidity Financial Group, L.P.
(filed herewith)
Exhibit 4. Letter Agreement, dated January 8, 1997, between
Krescent Partners, L.L.C. and American Holdings I,
L.P.
(filed herewith)
Exhibit 5. Assumption Agreement, dated January 8, 1997,
between American Holdings I, L.P. and Liquidity
Financial Group, L.P.
(filed herewith)
Exhibit 6. Joint Filing Agreement, dated February 10, 1997,
among American Holdings I, L.P., American Holdings
I-GP, Inc., American Property Investors, Inc.,
Longacre Corp., and Carl C. Icahn
(filed on February 10, 1997 as Exhibit 6 to the
Original Filing)
<PAGE>
SIGNATURES
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and
correct.
Dated February 11, 1997
AMERICAN HOLDINGS I, L.P.
By: AMERICAN HOLDINGS I,- GP, INC. ,General Partner
By: /s/ Henry J. Gerard
Henry J. Gerard
Title: Vice President
AMERICAN HOLDINGS I, GP, INC.
By: /s/ Henry J. Gerard
Henry J. Gerard
Title: Vice President
AMERICAN PROPERTY INVESTORS, INC.
By: /s/ John P. Saldarelli
John P. Saldarelli
Title: Vice President
LONGACRE CORP.
By: /s/ Edward Mattner
Edward Mattner
Title: President
CARL C. ICAHN
By: /s/ Theodore Altman
Theodore Altman
Attorney-In-Fact
(Signature Page for Krupp Realty Fund Ltd. III
Amendment No. 1 to Schedule 13D)
Exhibit Index
Exhibit
1. Settlement Agreement and Release, dated June 27, 1996, between The Krupp
Corporation and Liquidity Financial Group, L.P.
2. First Amendment to Settlement Agreement and Release, dated October 8,
1996, between The Krupp Corporation and Liquidity Financial Group, L.P.
3. Second Amendment to Settlement Agreement, dated January 6, 1997, between
The Krupp Corporation and Liquidity Financial Group, L.P.
4. Letter Agreement, dated January 8, 1997, between Krescent Partners,
L.L.C. and American Holdings I, L.P.
5. Assumption Agreement, dated January 8, 1997, between American Holdings
I, L.P. and Liquidity Financial Group, L.P.
6. Joint Filing Agreement, dated February 10, 1997, among American Holdings
I, L.P., American Holdings I-GP, Inc., American Property Investors,
Inc., Longacre Corp., and Carl C. Icahn
<PAGE> 1
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 Krupp Corporation ("Krupp"), a
Massachusetts corporation with a principal place of business at
470 Atlantic Avenue, Boston, Massachusetts 02210, 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 2200 Powell
Street, Suite 700, Emeryville, California 94608.
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, Krupp 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 Krupp sponsored and manages Krupp Realty Fund, Ltd.-III
("Realty III") and Krupp 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
"Krupp Fund") and collectively, the "Krupp Funds");
WHEREAS, Liquidity has, on behalf of certain of the
Liquidity Funds, sought to obtain from Krupp lists of the
investors in certain of the Krupp Funds for the stated purpose of
contacting such investors in order to attempt to acquire their
units in the Krupp Funds;
WHEREAS, Krupp 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.
<PAGE> 2
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, Krupp 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 Krupp 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, Krupp
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 Krupp Fund, current lists of
investors in such other Krupp 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 Krupp 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 Krupp, which may be
granted or withheld in Krupp's sole and exclusive discretion and
for any reason, or no reason:
(a) vote its interests in any Krupp 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
<PAGE> 3
make a proposal to acquire, directly or indirectly, more than a
25% interest in any Krupp 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 Krupp 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 Krupp 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
Krupp Fund;
(f) sell, transfer or assign any interests in any
Krupp 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 Krupp Fund will be utilized only for the purpose
of contacting investors to inquire as to whether they wish to
sell their units in such Krupp 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 Krupp 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
Krupp and will thereafter promptly (and in any event, within 5
business days) notify Krupp of the nature of such contact and the
<PAGE> 4
parties thereto. Krupp 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 Krupp at least 5 business days before mailing or
otherwise distributing to investors in any Krupp Fund any
communication to be given to one or more investors in any Krupp
Fund.
9. Fiduciary Duties of Krupp; Safe Harbor Provision,
Protection of Partnership Status: Liquidity acknowledges that:
(a) Krupp and its affiliates have significant
fiduciary obligations to the investors in the Krupp Funds, and
has stated that it is entering into this Agreement to, among
other things, fulfill those fiduciary obligations;
(b) Krupp 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
Krupp Funds to avoid the termination of such Krupp Fund's status
as a partnership under the Internal Revenue Code of 1986 (the
"Code"), as amended; avoid the treatment or such Krupp Fund as a
Publicly Traded Partnership under the Code; or cause the Krupp
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 Krupp 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 Krupp Fund.
Nothing herein shall be construed, however, as an
acknowledgment or agreement by Liquidity that Krupp has the right
under any particular circumstances to suspend the acceptance of
transfer paperwork, or as a waiver of any future claims of
<PAGE> 5
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
Krupp 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 Krupp to provide an investor list of any Krupp 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.
2200 Powell Street-Suite 700
Emeryville, California 94608
Attention: Brent Donaldson
with a copy to: Roger B. Mead, Esq.
Folger & Levin
Embarcadero Center West Tower
275 Battery Street-23rd Floor
San Francisco, California 94111
If to Krupp: The Krupp Corporation
470 Atlantic Avenue
Boston, Massachusetts 02210
Attention: Laurence Gerber
with a copy to: Scott D. Spelfogel, Esq.
Vice President and General Counsel
The Berkshire Group
470 Atlantic Avenue
Boston, Massachusetts 02210
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 Krupp, all such
liability being expressly contested. The parties agree that
<PAGE> 6
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.
<PAGE> 7
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/ Brent Donaldson
Brent Donaldson
President
THE KRUPP CORPORATION
By: /s/ Laurence Gerber
Laurence Gerber
President
<PAGE> 1
FIRST AMENDMENT TO
SETTLEMENT AGREEMENT AND RELEASE
This First Amendment to Settlement Agreement and Release
(this "Amendment") is made and entered into as of the 8th day of
October, 1996, by and between The Krupp Corporation ("Krupp"), a
Massachusetts corporation with a principal place of business at
470 Atlantic Avenue, Boston, Massachusetts 02210, and Liquidity
Financial Group, L.P. ("Liquidity") individually and on behalf of
certain Affiliates as defined in the Agreement (as hereinafter
defined), a California limited partnership with a principal place
of business at 2200 Powell Street, Suite 700, Emeryville,
California 94608.
WITNESSETH:
WHEREAS, the parties entered into a Settlement Agreement and
Release dated the 27th day of June, 1996 (the "Agreement") and
desire to the amend the Agreement, to eliminate a possible
ambiguity, as hereinafter set forth.
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the
parties hereto hereby agree as follows:
1. Section 4(d), of the Agreement shall be and hereby is
amended by adding, at the end of said section following the semi-colon, the
following clause:
provided, however, that Liquidity and Liquidity
Affiliates shall not be deemed to be acting in a
"group" in violation of this Section 4(d) solely by
virtue of their voting their interests in compliance
with Section 4(a) of this Agreement;
2. Except as expressly set forth above, the Agreement
shall remain in full force and effect without amendment or
modification.
IN WITNESS WHEREOF, the parties have executed this Agreement
under seal as of the date first above written.
<PAGE>
<PAGE> 2
LIQUIDITY FINANCIAL GROUP, L.P. THE KRUPP CORPORATION
By: Liquidity Financial
Corporation, its general partner
By:/s/ Brent Donaldson By:/s/ Laurence Gerber
------------------- -------------------
Brent Donaldson Laurence Gerber
President President
<PAGE> 1
SECOND AMENDMENT TO
SETTLEMENT AGREEMENT AND RELEASE
This Second Amendment to Settlement Agreement and Release
(this "Amendment") is made and entered into as of the 6th day of
January 1997, by and between The Krupp Corporation ("Krupp"), a
Massachusetts corporation with a principal place of business at
470 Atlantic Avenue, Boston, Massachusetts 02210, and Liquidity
Financial Group, L.P. ("Liquidity") individually and on behalf of
certain Affiliates as defined in the Agreement (as hereinafter
defined), a California limited partnership with a principal place
of business at 2200 Powell Street, Suite 700, Emeryville,
California 94608.
WITNESSETH:
WHEREAS, the parties entered into a Settlement Agreement and
Release dated the 27th day of June, 1996, as amended as of
October 8, 1996 (as amended, the "Agreement"), and now desire to
the amend the Agreement, to eliminate a possible ambiguity and to
facilitate the contemplated transactions described below, as
hereinafter set forth.
WHEREAS, Krescent Partners L.L.C. (i) retained Liquidity
Financial Advisors, Inc., an affiliate of Liquidity, as its
financial advisor, (ii) agreed to become bound by the terms of
the Agreement, and (iii) commenced tender offers (the "Krescent
Tender Offers") for units of Investor Limited Partnership
Interests of the real estate limited partnerships listed on
Schedule I attached hereto (the "Scheduled Partnerships");
WHEREAS, American Holdings I, L.P. ("AHI") desires to
participate in the Krescent Tender Offers and, therefore, has
agreed to become bound by the terms of the Agreement with respect
to the Scheduled Partnerships; and
WHEREAS, Krupp has consented to the participation of AHI in
the Krescent Tender Offers upon AHI's agreement to be bound by
the terms of the Agreement with respect to the Scheduled
Partnerships;
NOW, THEREFORE, in consideration of the foregoing and for
other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto
hereby agree as follows:
<PAGE>
<PAGE> 2
1. Section 4(d), of the Agreement is hereby amended and
restated in its entirety as follows:
(d) form, join or otherwise participate in a "group" within
the meaning of Section 13(d)(3) of the Securities and
Exchange Act of 1934, as amended, with respect to any voting
securities of a Krupp Fund, unless each member of such group
agrees in writing to be bound by the terms of this
Agreement; provided, however, that Liquidity and Liquidity
Affiliates shall not be deemed to be acting in a "group" in
violation of this Section 4(d) solely by virtue of their
voting their interests in compliance with Section 4(a) of
this Agreement;
2. Krupp hereby agrees that the agreement between
Liquidity and AHI, attached hereto as Exhibit A, satisfies the
requirements of the amended Section 4(d) of the Agreement, as set
forth in Section 1 of this Amendment.
3. Except as expressly set forth above, the Agreement
shall remain in full force and effect without amendment or
modification.
IN WITNESS WHEREOF, the parties have executed this
Agreement under seal as of the date first above written.
THE KRUPP CORPORATION
By:/s/ Laurence Gerber
-------------------
Laurence Gerber
President
LIQUIDITY FINANCIAL GROUP, L.P.
By: Liquidity Financial
Corporation, its general partner
By: /s/ Brent Donaldson
-------------------
Brent Donaldson
President
<PAGE>
<PAGE> 3 SCHEDULE I
Krupp Realty Fund, Ltd. - III
Krupp Realty Limited Partnership - V
Krupp Realty Limited Partnership - VII
Krupp Cash Plus Limited Partnership
KRESCENT PARTNERS L.L.C.
1301 AVENUE OF THE AMERICAS, 38TH FLOOR
NEW YORK, NEW YORK 10019
January 8, 1997
American Holdings I, L.P.
100 South Bedford Road
Mount Kisco, New York 10549
Re: KRUPP REALTY FUND, LTD.--III
Ladies and Gentlemen:
The parties hereto confirm their agreement to the terms
of Exhibit A annexed hereto, which terms are incorporated herein
by reference, which agreement is intended to be legally binding
and enforceable upon execution and delivery hereof and which,
unless modified or terminated by a writing signed by all of the
parties hereto, constitutes the definitive agreement among the
parties relating to the subject matter hereof and thereof.
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, (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 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.
This letter agreement shall be governed by and
interpreted in accordance with the laws of the State of New York,
without regard to the conflicts of law provisions thereof.
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 shall supersede 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. 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,.
KRESCENT PARTNERS L.L.C.
By: AP-GP Prom Partners Inc.,
Managing Member
By: /s/ Richard Mack
Richard Mack, Vice President
AP-GP PROM PARTNERS INC.
By: /s/ Richard Mack
Richard Mack, Vice President
APOLLO REAL ESTATE INVESTMENT
FUND II, L.P.
By: Apollo Real Estate
Advisors II, L.P.,
General Partner
By: Apollo Real Estate Capital
Advisors II, Inc.
General Partner
By: /s/ W. Edward Scheetz
W. Edward Scheetz<PAGE>
KRESCENT LFG L.L.C.
By: AP-GP Prom Partners Inc.,
Managing Member
By: /s/ Richard Mack
Richard Mack, Vice President
ACCEPTED AND AGREED TO AS
OF THE DATE FIRST ABOVE WRITTEN:
AMERICAN HOLDINGS I, L.P.
By: American Holdings I-GP, Inc.,
General Partner
By: /s/ Henry J. Gerard
Henry J. Gerard, Vice President
AMERICAN HOLDINGS I-GP, INC.
By: /s/ Henry J. Gerard
Henry J. Gerard, Vice President
AMERICAN REAL ESTATE HOLDINGS
LIMITED PARTNERSHIP
By: American Property Investors, Inc.,
General Partner
By: /s/ John P. Saldarelli
John P. Saldarelli
<PAGE> 1
ASSUMPTION AGREEMENT (this "Agreement"), dated as of
January 8, 1997, between Liquidity Financial Group, L.P., a
California limited partnership ("LFG"), and American Holdings I,
L.P., a Delaware limited partnership ("AHI").
W I T N E S S E T H:
WHEREAS, LFG and The Krupp Corporation, a Massachusetts
corporation (the "Corporation"), entered into a Letter Agreement,
dated as of June 27, 1996 and amended as of October 8, 1996 and
January 8, 1997 (the "Letter Agreement"), pursuant to which LFG
and its Affiliates (as defined therein) agreed to certain
restrictions in exchange for current lists (the "Lists") of the
names and addresses of the holders of the units of Investor
Limited Partnership Interest (or depositary certificates
representing such units) (the "Units") in various real estate
limited partnerships sponsored and/or managed by The Krupp
Corporation, a Massachusetts corporation ("Krupp");
WHEREAS, Krescent Partners L.L.C. (I) retained
Liquidity Financial Advisors, Inc., an affiliate of LFG, as its
financial advisor and (ii) used the Lists of the real estate
limited partnerships listed on Schedule I attached hereto (the
"Scheduled Partnerships") to commence tender offers for Units
(the "Krescent Tender Offers");
WHEREAS, AHI desires to participate in the Krescent
Tender Offers and, therefore, has agreed to become bound by the
terms of the Letter Agreement with respect to the Scheduled
Partnerships; and
WHEREAS, Longacre Corporation ("Longacre"), an
affiliate of AHI, and Krupp are parties to an agreement, dated
November 26, 1996 (the "Longacre Standstill Agreement"), pursuant
to which Longacre has undertaken (on its own behalf and on behalf
of its affiliated, including AHI) certain obligations with
respect to the Scheduled Partnerships and certain other real
estate limited partnerships sponsored by Krupp and, concurrently
with the execution and delivery hereof, Longacre and Krupp have
executed and delivered an amendment to the Longacre Standstill
Agreement (the "Amendment") to delete the Scheduled Partnerships
from the schedule of real estate limited partnerships covered by
the Longacre Standstill Agreement;
NOW, THEREFORE, in consideration of the foregoing and
other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, AHI agrees as
follows:
<PAGE> 2
(a) With respect to the Scheduled Partnerships, from
and after the date hereof AHI hereby agrees to become bound by
the Letter Agreement to the extent LFG is so bound as if AHI had
executed the Letter Agreement on the date hereof; provided,
however, AHI shall only have liability with respect to its
actions or inactions under the Letter Agreement and shall not be
liable for any breach of any representation, warranty or covenant
by LFG or any other party to the Letter Agreement (whether
directly or by assumption).
(b) AHI shall not be bound by the Letter Agreement to
the extent that any of the obligations and liabilities of LFG
under the Letter Agreement are expanded, broadened, increased or
enlarged.
(c) Nothing contained herein shall require AHI to pay,
perform or discharge any liabilities or obligations expressly
assumed hereunder so long as AHI shall in good faith contest or
cause to be contested the amounts or validity thereof.
(d) AHI represents that it has not made any statements
inconsistent with the terms of the Krescent Tender Offers and
hereby agrees to comply with the terms of that certain letter
dated December 17, 1996 from Steven L. Lichtenfeld to James
Dubin, a copy of which is attached hereto.
IN WITNESS WHEREOF, LFG and AHI have caused this
Agreement to be duly executed as of the date first written above.
AMERICAN HOLDINGS I, L.P.
By: American Holdings I-GP, Inc.,
Its general partner
By: /s/ Henry J. Gerard
Name: Henry J. Gerard
Title: Vice President
<PAGE>
<PAGE> 3
LIQUIDITY FINANCIAL GROUP, L.P.
By: Liquidity Financial
Corporation, its general
partner
By: /s/ Brent Donaldson
Name: Brent Donaldson
Title: Vice President
