SUPREME COURT OF THE STATE OF NEW YORKCOUNTY OF NEW YORK-----------------------------------------------------------------xTHE PEOPLE OF THE STATE OF NEW YORKby ANDREW M. CUOMO, Attorney General of theState of New York,Plaintiff,- against -J. EZRA MERKIN and GABRIEL CAPITALCORPORATION,Defendants,- and -ARIEL FUND LIMITED, ASCOT FUND LIMITED,ASCOT PARTNERS, L.P., GABRIELALTERNATIVE ASSETS LLC, GABRIEL ASSETSLLC, and GABRIEL CAPITAL L.P.,Relief Defendants.::::::::::::::::::::::

Index No. 450879/2009

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STIPULATION AND INTERLOCUTORY ORDER OF SALE

WHEREAS, on April 6, 2009, Andrew M. Cuomo, Attorney General of the State of New York, commenced a lawsuit against J. Ezra Merkin (“Merkin”) and Gabriel CapitalCorporation (“GCC” and collectively, “Defendants”), alleging claims for,

inter alia

, securitiesfraud offenses in violation of the Martin Act (G.B.L. § 352,

et seq.

), persistent fraud or illegality inviolation of Executive Law § 63(12), and breach of fiduciary duty in violation of Non-ProfitCorporation Law §§ 112 , 717 and 720;

2WHEREAS, the Complaint alleges that: Merkin was the sole shareholder and soledirector of GCC, completely controlled and dominated GCC, commingled his personal funds withGCC brokerage and bank accounts, and used the GCC accounts for his personal benefit, includingsubstantial purchases of valuable works of art for his residence;WHEREAS, in the Complaint, the Attorney General seeks restitution to compensateinvestors who were allegedly defrauded by Merkin (“Merkin Investors”) and disgorgement byMerkin of all property allegedly constituting or derived from proceeds traceable to the commissionof the alleged offenses, including but not limited to valuable works of art owned by Merkin andLauren K. Merkin (the “Subject Property”);WHEREAS, Defendants deny any wrongdoing;WHEREAS, there is a lien on certain of the Subject Property held byPaceWildenstein LLC, as agent for Kate Rothko Prizel and Christopher Rothko, in the amount of $42,000,000;WHEREAS, there is a lien held by HSBC Bank USA, N.A., in the amount of $19,301,741.58 on certain of the Subject Property and fourteen lesser works of art, which fourteenworks of art remain subject to the Order of this Court dated April 7, 2009;WHEREAS, on April 7, 2009, the Honorable Richard B. Lowe III So Ordered aStipulation by which the Defendants were enjoined, without the prior permission of the AttorneyGeneral, from removing, transferring or conveying any assets, including any works of art acquiredby or controlled by Merkin;WHEREAS, Merkin and Lauren K. Merkin have entered into a sales contract to sellthe Subject Property for $310,000,000, subject to the approval of the Attorney General;

3WHEREAS, a recent appraisal conducted by Christie’s Appraisal, Inc., on behalf of the Attorney General, indicates the purchase price of the Subject Property to be fair; andWHEREAS, the Attorney General believes that an interlocutory sale of the SubjectProperty is in the best interests of the Merkin Investors insofar as it liquidates and preserves assetsthat might be available to satisfy the claims of the Merkin Investors pending conclusion of thislawsuit; andWHERERAS, the Attorney General and Merkin have agreed that the net proceedsof the sale as described below will be held in escrow pending further order of this Court;NOW, THEREFORE, IT IS HEREBY STIPULATED AND AGREED that:1. The Attorney General consents to the interlocutory sale of the Subject Property.2. Merkin shall not take, or cause to be taken, any action intended to have the effect of depreciating, damaging, or in any way diminishing the value of the Subject Property.3. In furtherance of the interlocutory sale, Merkin agrees to promptly execute, or causeto be executed, any documents which may be required, consistent with this Stipulation and theContract (defined below), to complete the interlocutory sale of the Subject Property, including butnot limited to extinguishing any liens upon the Subject Property.4. The Subject Property shall be sold in an arms-length transaction under terms andconditions of a written contract (the “Contract”) approved by the Attorney General for the totalsum of $310,000,000.5. Merkin and Lauren K. Merkin declare that the buyer of the Subject Property is notassociated with, related to, or acting on behalf of Merkin.