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general release of all claims and counterclaims relating to the
construction contract. Petitioner signed the settlement
agreement, as did the other current and former managing general
partners in Biomass.
A trust account (the trust account) was established by the
law firm of Irell and Manella, attorneys for Biomass, to hold and
disburse the funds received pursuant to the settlement agreement
(the settlement proceeds).
Option Agreement
Previously, on December 31, 1987, petitioner, Weisel, and
certain limited partners of Biomass, including Laurence A.,
Preston R., Daniel R. and Thomas J. Tisch, and Project Capital
1985, a New York general partnership (collectively, the Tisch
group), had entered into an option agreement (the option
agreement).
At the time the option agreement was executed, petitioner
and Weisel had equal interests in Biomass (a 3.3-percent interest
that would become a 14.561-percent interest after the 60th month
of commercial operation of the cogeneration facility). Under the
option agreement, the Tisch group had the option to purchase part
of Weisel’s and petitioner’s interests in Biomass. The amount to
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Last modified: May 25, 2011