STIPULATION OF SETTLEMENT

[Excerpts]

WHEREAS, plaintiff Alchemy Condominium ("Alchemy") is a condominium association formed under Section 339 (i) of the Real Property Law of the State of New York; WHEREAS, defendant House of Sound ("House of Sound") is the tenant of the premises known as Unit C-1 (referred to herein as the "Recording Studio" or the "Unit") at 36-40 West 13th Street, New York, N.Y.

WHEREAS, on May 14,2002, the Honorable Barbara R. Kapnick executed an Order (the "TRO") which restrained the Studio Defendants, and all of their related entities, fiom "allowing or permitting any entity, person or group of persons, including but not limited to the Studio Defendants themselves, to play, broadcast or perform music or to cause such music to be played, broadcasted or performed in commercial unit C-1 of the premises leased to and used by the Studio Defendants to operate a music recording studio, such that the sound level in the lobby or in any resident's apartment within the premises resulting from such music exceeds legal limits;"

WHEREAS, thereafter, Alchemy moved by Order to Show Cause on or about June 13,2002, to hold the Studio Defendants in contempt for violations of the TRO, which application resulted in an Order dated June 29,2002;

NOW, THEREFORE, in consideration of the mutual covenants hereinafter contained and for good and valuable consideration the receipt of which is hereby acknowledged, it is hereby stipulated and agreed as follows: 1. The Studio Defendants hereby agree to perform certain soundproofing work on the first floor in the Recording Studio in order to comply with the recommendations given by the Studio Defendants' experts, Lewis S . Goodfriend & Associates ("LSG & A") and Soundvu Associates ("Soundvu"). Except as provided herein, the Soundproofing Work (as hereinafter defined) shall be performed at the Studio Defendants' sole cost and expense.

In the event the Soundproofing Work in both rooms is not completed by March 1 , 2003, the Studio Defendants hereby agree that effective March 1 , 2003 they shall not use any of the sound studios in the Recording Studio (except as set forth in the next sentence) in any manner whatsoever, at any time, on any day, for the purpose of operating the sound equipment therein or generating sound in any fashion.

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