SUPREME COURT STATE OF NEW YORK
COUNTY OF NEW YORK
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BLEECKER CHARLES COMPANY, suing derivatively 
on behalf of 350 BLEECKER STREET APARTMENT 
CORPORATION,                                               Index #:101857/03
 

               Plaintiff,                                   VERIFIED ANSWER
                                                     
               -v-

MARK LILIEN and JAMES KAFADAR,

               Defendants

               and

350 BLEECKER STREET APARTMENT
CORPORATION,

               Nominal Defendants

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          Defendants Mark Lilien ("Lilien") and James D. Kafadar ("Kafadar"), (hereinafter collectively referred to as "Defendants") by their attorneys Mandel Resnik Kaiser Moskowitz & Greenstein, P.C., as and for their answer to the Complaint herein of Bleecker Charles Company ("Plaintiff"), purporting to sue derivatively on behalf of 350 Bleecker Street Corporation, alleges as follows:

          1.          Admit so much of paragraph 1 of the Complaint as alleges that Plaintiff is a record and beneficial owner of shares of common stock of the Co-op known as 350 Bleecker Street Apartment Corporation ("the Co-op") and denies having knowledge or information sufficient to form a belief as to the remaining allegations contained in paragraph 1.

          2.          Admit the allegations contained in paragraph 2 of the Complaint, except respectfully refers the Court to the cooperative conversion plan as the best evidence of the terms and legal import thereof.

          3.          With respect to paragraph 3 of the Complaint deny having knowledge or information sufficient to form a belief as to the allegations contained in the first sentence of paragraph 3 and admit the allegations contained in the second sentence of paragraph 3 of the Complaint.

          4.          Admit so much the allegations contained in paragraph 4 of the Complaint as alleges that Lilien and Kafadar are residents of the Building, each own units that were at different and diverse times separate units and deny knowledge or information sufficient to form a belief as to the remaining allegations contained in paragraph 4 of the Complaint.

          5.          Admit the allegations contained in the first four sentences of paragraph 5 of the Complaint and deny having knowledge or information sufficient to form a belief as to the "Window Period" referred to in the fifth sentence of paragraph 5 of the Complaint.

          6.          With respect to the allegations contained in paragraph 6 of the Complaint admit that an action bearing Index No. 11327/02 was commenced in this Court by the Co-op against Newman and others, that the Complaint was verified by Lilien as a director of the Co-op's Board of Directors and respectfully refers the Court to the complaint in that action as the best evidence of the allegations and claims raised therein.

          7.          Admit so much of paragraph 7 of the Complaint as alleges that among the claims alleged in the action identified in paragraph 6 of the Complaint is a claim that Newman breached certain fiduciary duties and obligations owed to the Co-op involving the Master Lease, the Garage Lease and the Federal Condominium and Cooperative Conversion Protection and Abuse Relief Act and respectfully refer the Court to that Complaint as the best evidence of the breach of fiduciary duty and other claims raised therein.

          8.          With respect to the allegations contained in paragraph 8 of the Complaint respectfully refers the Court to said Complaint as the best evidence of the allegations contained therein.

          9.          Deny each and every allegation contained in paragraph 9 of the Complaint.

          10.          With respect to the allegations contained in paragraph 10 of the Complaint deny the allegations contained in the first sentence of paragraph 10 and respectfully refer the Court to the answer interposed by Newman in the Co-op's State Court action as the best evidence of the allegations and defenses asserted therein by Newman.

          11.          Deny the allegations contained in paragraph 11 of the Complaint.

          12.          With respect to paragraph 12 of the Complaint admit that by letter dated October 23, 2002 the Sponsor made a demand of the Co-op that it file suit against Lilien and Kafadar and respectfully refers the Court to said letter as the best evidence of the contents thereof.

          13.          With respect to the allegations contained in paragraph 13 of the Complaint admit that by letter dated December 9, 2002 counsel for the Co-op acknowledged receipt of the Sponsor's October 23 letter and respectfully refers the Court to the December 9 letter as the best evidence of the terms thereof.

          14.          With respect to the allegations contained in paragraph 14 of the Complaint admit that by letter dated December 20, 2002 the Co-op's counsel advised the Sponsor that a special committee had been appointed by the Co-op to consider the Sponsor's demands and respectfully refers the Court to said letter as the best evidence of the contents thereof.

          15.          With respect to the allegations contained in paragraph 15 of the Complaint admits only that Exhibit C to the Complaint is a true and accurate copy of a Stipulation dated December 24, 2002 and respectfully refers the Court to said Stipulation as the best evidence of the parties' respective rights and obligations thereunder.

          16.          Deny the allegations contained in paragraph 16 of the Complaint.

          17.          No response is required to paragraph 17 of the Complaint.

          18.          With respect to the allegations contained in paragraph 18 of the Complaint admit that Defendants Lilien and Kafadar, as well as Newman, at all relevant times had fiduciary obligations to the Co-op.

          19.          Deny the allegations contained in paragraph 19 of the Complaint.

          20.          Deny the allegations contained in paragraph 20 of the Complaint.

          21.          Deny the allegations contained in paragraph 21 of the Complaint.

          22.          Deny the allegations contained in paragraph 22 of the Complaint.

AS AND FOR A FIRST AFFIRMATIVE DEFENSE

          23.          The Complaint fails to state a legally cognizable claim.

AS AND FOR A SECOND AFFIRMATIVE DEFENSE

          24.          This action is barred by the business judgment rule.

AS AND FOR A THIRD AFFIRMATIVE DEFENSE

          25.          Plaintiff's Complaint is barred by the doctrine of unclean hands.

          WHEREFORE, Defendants pray for judgment dismissing the Complaint in its entirety, together with the costs and disbursements of this action.

Dated: New York, New York
            March 12, 2003