JOINT STIPULATION AND ORDER FOR LIMITED RELIEF FROM ORDER APPOINTING RECEIVER RE: CLAIM OF LIEN

NOTED ON MOTION CALENDAR: Date of Filing per [Local Rules: 10(g), 7(d)1]

JAMES L. ROBART, District Judge.

JOINT STIPULATION

PLEASE TAKE NOTICE that Michael A. Grassmueck, the duly appointed receiver (the "Receiver") for Defendants Path America, LLC, Path America SnoCo, LLC, Path America Farmer's Market, LP, Path America KingCo, LLC, Path America Tower, LP, Path Tower Seattle, LP, and Potala Tower Seattle, LLC and Relief Defendants Potala Shoreline, LLC, and Potala Village Kirkland, LLC (collectively the "Receivership Entities"), and Pacific Coast Electrical Contractors, Inc. ("Pacific Coast"), and the Securities and Exchange Commission, by and through their counsel of record, hereby stipulate to limited relief from this Court's October 22, 2015 Order Appointing Receiver (Dkt. No. 88) as follows:

WHEREAS the Receiver was appointed receiver for the Receivership Entities pursuant to the Order Appointing Receiver on October 22, 2015 ("Appointment Order");

WHEREAS Section VI of the Order Appointing Receiver expressly restrains and enjoins all persons receiving notice of the Order from taking any action to interfere with the Receiver's efforts to take control, possession, or management of any property of the Receivership Entities, including by way of creating or enforcing a lien upon any such property;

WHEREAS property of the Receivership Entities includes the Potala Farmer's Market Project located at 2900 Grand Avenue, Everett, Snohomish County, Washington 98201 (the "Market Project"), which is currently in the final stages of construction;

WHEREAS prior to the appointment of the Receiver, Synergy Construction, Inc. ("Synergy") entered into a contract dated February 12, 2015 with Path America Farmer's Market LP and Path America Farmer's Market, LLP ("Potala Tower") to serve as the general contractor for the Market Project;

WHEREAS on September 14, 2015, Synergy and Pacific Coast entered into a subcontract under which Pacific Coast agreed to perform work as the electrical subcontractor on the Market Project for the lump sum amount of $636,850.00.

WHEREAS Pacific Coast alleges that on or about September 8, 2015, Pacific Coast commenced construction on the Market Project and continued working on the project through the date of January 22, 2016;

WHEREAS Pacific Coast alleges that it has incurred costs of providing labor, materials, equipment, and furnished labor, in the amount of $491,142.501 (including $62,108.50 of retainage) in connection with work performed on the Market Project, and that such costs remain unpaid, and that it believes that Washington state law requires it to record a claim of mechanics' and materialmen's lien against the Market Project on or before April 21, 2016 (90 days following that last day of work) or risk losing that right under state law;

WHEREAS in his reasonable business judgment exercised in accordance with the duties of his appointment, the Receiver believes: (1) in light of Pacific Coast's past and possible future role of the electrical subcontractor for the Market Project; (2) Pacific Coast's ongoing cooperation in providing information to the Receiver; and (3) Pacific Coast's agreement herein that in entering this stipulation the Receiver is not agreeing to the timeliness, amount or basis for claim of lien, it is in the best interest of the receivership estate, to agree that Pacific Coast may record a claim of lien against the Market Project in the amount of $491,142.50, and that such relief does not extend to permit amendments of such lien, the filing of an action to foreclose the lien or any other form of self-help, absent further order of this Court;

WHEREAS in agreeing to this Stipulation, the Receiver takes no position as to the validity of the claims Pacific Coast asserts against the Receivership Entities, including its claims precipitating its request to record a claim of lien against the Market Project, and expressly reserves his right to contest the timeliness, validity and/or amount of any lien recorded; and

WHEREAS under the circumstances unique to Pacific Coast and the Market Project, the Receiver believes, in his reasonable business judgment exercised in accordance with the duties of his appointment, limited relief from the Appointment Order is appropriate.

THEREFORE, the Receiver and Pacific Coast hereby STIPULATE and AGREE as follows:

1. Pacific Coast shall be granted limited relief from the prohibitions set forth in the Appointment Order for the sole purpose of recording a claim of lien in Snohomish County of the State of Washington, against the Market Project in the amount of $491,412.50;

2. Such relief from the prohibitions set forth in the Appointment Order shall be limited to Pacific Coast and shall not extend to any other creditor of the Receivership Entities;

3. The authorization for Pacific Coast to record a claim of lien does not include authorization for the recording of any amendments or revisions thereto, or the filing of any action to foreclose on the lien, and does not include any other relief from any other provisions of the Appointment Order, which shall remain in full force and effect until otherwise ordered by the Court;

4. Pacific Coast retains all other rights it currently has, including without limitation the right to petition the Court for further relief from this Court's October 22, 2015 Order Appointing Receiver (Dkt. No. 88) to, inter alia, amend its claim of lien and/or file a lawsuit to foreclose its claim of lien; and

5. The Receiver's agreement to such relief provided to Pacific Coast shall not be construed as taking any position as to the validity of any claim Pacific Coast may assert against the Receivership Entities, including its claims precipitating its request to record a claim of lien against the Market Project, and the Receiver expressly reserves all rights to challenge the validity and amount of the claim of lien, any petition, motion, or action filed by Pacific Coast in this or any other court, and of any claims Synergy may assert against the Receivership Entities.

IT IS SO STIPULATED.

[PROPOSED] ORDER

The Court, having read the Joint Stipulation For Limited Relief From Order Appointing Receiver (the "Stipulation") filed by Michael A. Grassmueck (the "Receiver"), court-appointed receiver for Defendants Path America, LLC, Path America SnoCo, LLC, Path America Farmer's Market, LP, Path America KingCo, LLC, Path America Tower, LP, Path Tower Seattle, LP, and Potala Tower Seattle, LLC and Relief Defendants Potala Shoreline, LLC, and Potala Village Kirkland, LLC (collectively the "Receivership Entities"), and Pacific Coast Electrical Contractors, Inc. ("Pacific Coast"), and good cause appearing, hereby ORDERS as follows:

1. The Stipulation is approved;

2. Pacific Coast is hereby GRANTED limited relief from the October 22, 2015 Order Appointing Receiver (the "Appointment Order") for the sole purpose of recording a claim of lien in Snohomish County in the State of Washington, as against the Market Project in the amount of $491,142.50;

3. This relief from the Appointment Order granted to Pacific Coast is limited to Pacific Coast and does not extend to any other creditor of the Receivership Entities;

4. This relief from the Appointment Order granted to Pacific Coast to record a claim of lien does not authorize the recording of any amendments or revisions thereto, or the filing of any action to foreclose on the lien, and does not include any other relief from any other provisions of the Appointment Order, which shall remain in full force and effect unless otherwise ordered by this Court; and

5. This relief granted to Pacific Coast is not to be viewed by other creditors of the estate of the Receivership Entities as setting any precedent for the administration of creditor claims or the filing of liens, which shall be reviewed by the Court on a case-by-case basis.