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Exhibit 10.6

SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK

   x  
 
 
ALAN R. KAHN, derivatively, on behalf of
VALUE LINE, INC.,
 
Plaintiff,
 
v.
 
JEAN BERNHARD BUTTNER, EDGAR A.
BUTTNER, JANET EAKMAN, DAVID T.
HENIGSON, HOWARD A. BRECHER,
EDWARD J. SHANAHAN, HERBERT
PARDES, MARION N. RUTH, and ARNOLD
BERNHARD & CO., INC.,
 
Defendants,
 
and
 
VALUE LINE, INC.,
 
Nominal Defendant.
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Present:  Hon. Bernard Fried, J.S.C.
 
Index No. 650320/2008
 
STIPULATION OF SETTLEMENT
 
   x  
 
 

 
The Stipulation of Settlement, dated as of September 30, 2011 (the
“Stipulation”), is made and entered into by and among the Settling Parties (as
defined below) in full and final settlement of the claims asserted in the
above-captioned consolidated actions, subject to the approval of the Supreme
Court of the State of New York (“Court”).
 
RECITALS
 
WHEREAS,
 
A.           On August 14, 2008, a shareholder derivative lawsuit, entitled Kahn
v. Buttner, et al., Index. No. 650320/2008 (the “First Derivative Action”), was
filed in this Court on behalf of nominal defendant Value Line, Inc. (“Value
Line” or the “Company”) against certain Directors or former Directors of Value
Line, Jean Bernhard Buttner (“Buttner”), Edgar A. Buttner (“E_Buttner”), David
T. Henigson (“Henigson”), Howard A. Brecher (“Brecher”), Edward J. Shanahan
(“Shanahan”), Janet Eakman (“Eakman”), Herbert Pardes (“Pardes”), and Marion N.
Ruth (“Ruth”).  The complaint in the First Derivative Action alleged claims for
breach of fiduciary duty and unjust enrichment in connection with what were
alleged to be improper brokerage commissions charged by Value Line Securities,
Inc. (“VLS”), a broker-dealer wholly owned by Value Line.  No relief was sought
against Value Line, which was named as a nominal defendant.
 
 
 

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B.           On November 4, 2009, the United States Securities and Exchange
Commission, (the “SEC”), the SEC accepted Offers of Settlement submitted by
Value Line, VLS, Buttner and Henigson, and issued an Order (the “SEC Order”) in
the proceeding styled as In the Matter of Value Line, Inc. et al.,
Administrative Proceeding  File No. 3-13675.
 
C.           On November 9, 2009, a second shareholder derivative lawsuit,
entitled Morrison v. Buttner, et al., Index No. 650658/2009 (the “Second
Derivative Action”), was filed in this Court on behalf of nominal defendant
Value Line against Buttner, Henigson, Brecher, and Arnold Bernhard & Co., Inc.
(“AB&Co.”).  The complaint in the Second Derivative Action alleged claims for
(i) breach of fiduciary duty and unjust enrichment in connection with what were
alleged to be brokerage commissions charged by VLS that were not fair and
reasonable, and (ii) an accounting concerning the allocation of expenses between
AB&Co. and Value Line.  No relief was sought against Value Line, which was named
as a nominal defendant.
 
D.           On November 10, 2009, Plaintiff Larry Morrison in the Second
Derivative Action served his First Request for Production of Documents (the
“Initial Document Request”), which sought the production of numerous categories
of documents from Value Line and the other defendants.
 
 
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E.           On January 8, 2010, the Court issued an Order granting the
unopposed motion of Plaintiffs Alan R. Kahn and Larry Morrison (“Plaintiffs”)
for appointment of lead counsel and consolidation of the derivative actions
under the caption Alan R. Kahn, derivatively, on behalf of Value Line, Inc., et
al. v. Jean Bernhard Buttner, et al., Supreme Court, New York County, Index. No.
650320/2008 (the “Consolidated Action”).
 
F.           On March 16, 2010, Plaintiffs filed a Verified Amended Shareholder
Derivative Complaint (the “Complaint”), derivatively on behalf of Value Line,
against Buttner, Henigson, Brecher, E_Buttner, Eakman, Shanahan, Ruth, Pardes,
and AB&Co.  No relief is sought against Value Line, which is named as a nominal
defendant.  The Complaint alleged claims for breach of fiduciary duty arising
from: (1) what were alleged to be brokerage commissions charged by VLS that were
not fair and reasonable; (2) allegedly allowing vendors to overcharge Value Line
for advertising; and (3) allegedly receiving excessive compensation.  In
addition, the Complaint sought an accounting concerning the allocation of
expenses between AB&Co. and Value Line.
 
G.           On April 20, 2010, Plaintiffs served Plaintiffs’ First Request for
the Production of Documents to all defendants including nominal defendant Value
Line, Inc. (“Plaintiffs’ First Document Request”), which sought the production
of numerous categories of documents from Value Line and the other defendants.
 
H.           On May 10, 2010, defendants began their production of documents
responsive to Plaintiffs’ request.
 
I.           On August 20, 2010, defendants Pardes, Shanahan and Ruth filed a
motion to dismiss the Complaint.  On that same day, defendant Eakman also filed
a motion to dismiss the Complaint.  (Pardes, Shanahan, Ruth and Eakman are
hereafter collectively referred to as the “Former Defendants”).
 
 
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J.           On August 20, 2010, defendants Buttner, Henigson, Brecher,
E_Buttner and AB&Co. filed their Answer to the Complaint, and nominal defendant
Value Line filed its Answer to the Complaint.
 
K.           On September 8, 2010, the Court approved a stipulation dismissing
the action against Eakman, without prejudice.
 
L.           On September 13, 2010, the Court entered a Preliminary Conference
Order setting dates for discovery, the filing of the note of issue and any
motions for summary judgment.
 
M.           On September 27, 2010, the Court entered a Stipulation and Order
for the Production and Exchange of Confidential Information relating to
confidential or proprietary documents produced by the parties or others in the
course of discovery.
 
N.           On September 28, 2010, the Court approved a stipulation dismissing
the action against defendants Pardes, Shanahan and Ruth, without prejudice.
 
O.           On September 30, 2010, defendants Pardes, Shanahan and Ruth served
their Responses and Objections to Plaintiffs’ First Request for Production of
Documents and produced thousands of pages of documents in response to
Plaintiffs’ First Document Request.
 
P.           On October 6, 2010, defendants Buttner, Henigson, Brecher,
E_Buttner, AB&Co. and nominal defendant Value Line served their Responses and
Objections to Plaintiffs’ First Request for the Production of Documents.  In
sum, defendants produced nearly 300,000 pages of documents to Plaintiffs.
 
 
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Q.           On January 13, 2011, the Court entered an Order of Reference to
Alternative Dispute Resolution, referring the parties to the Alternative Dispute
Resolution (“ADR”) Program of the Commercial Division and staying all
proceedings during the ADR process.
 
R.           Following mediation pursuant to the ADR program, Value Line,
defendants Buttner, E_Buttner, Henigson, Brecher and AB&Co. (hereinafter the
“Defendants”) and the Plaintiffs agreed to resolve all claims that were or could
have been asserted in the Complaint.
 
S.           Defendants have denied and continue to deny each and all of the
claims and contentions alleged by the Plaintiffs in the Complaint.  Defendants
expressly have denied and continue to deny all charges of wrongdoing or
liability against them arising out of any of the conduct, statements, acts, or
omissions alleged, or that could have been alleged, in the Complaint, and deny
and continue to deny that they caused Value Line to suffer any damage or harm to
its reputation or otherwise engaged in conduct that constituted a breach of
their fiduciary duties.  Defendants have maintained and continue to maintain
that at all material times they acted in good faith and in a manner they
believed to be in the best interests of Value Line and its shareholders.
 
T.           Nonetheless, Defendants have concluded that further conduct of the
Consolidated Action would be protracted and expensive, and that it is desirable
that the Consolidated Action be fully and finally settled in the manner and upon
the terms and conditions set forth in the Stipulation.  Defendants also have
taken into account the uncertainty and risks inherent in any litigation,
especially in complex cases such as the Consolidated Action.  Defendants have,
therefore, determined that it is desirable that the Consolidated Action be
settled in the manner and upon the terms and conditions set forth in the
Stipulation.  There has been no adverse determination by any court against any
of the Defendants on the merits of the claims asserted by the Plaintiffs.
 
 
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U.           Plaintiffs believe that the claims asserted in the Complaint have
merit.  However, Counsel for the Plaintiffs recognize and acknowledge the
expense and length of continued proceedings necessary to prove their allegations
and to prosecute the Consolidated Action against the Defendants through trial
and through appeals.  Counsel for Plaintiffs also have taken into account the
uncertain outcome and the risk of any litigation, especially in complex actions
such as the Consolidated Action, as well as the difficulties and delays inherent
in such litigation.  Counsel for Plaintiffs also are mindful of the inherent
problems of proof and possible defenses to the violations asserted in the
Consolidated Action.
 
V.           Counsel for the Plaintiffs believe that the settlement set forth in
the Stipulation confers substantial benefits upon Value Line and its
Shareholders (as hereinafter defined) and is in the best interest of the
Plaintiffs and Value Line and its Shareholders.
 
W.           Value Line and Value Line’s outside counsel, Echtman & Etkind, LLP,
have also determined that the settlement set forth in the Stipulation is in the
best interests of the Company and its shareholders.
 
NOW, THEREFORE, it is hereby stipulated and agreed, by and among Plaintiffs,
nominal defendant Value Line, and each of the other Defendants, by and through
their respective counsel or attorneys of record, that, subject to the approval
of this Court, the Consolidated Action and the Released Claims (as defined
below) shall be finally and fully compromised, settled and released, and the
Consolidated Action shall be dismissed with prejudice, upon and subject to the
terms and conditions of the Stipulation.
 
 
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DEFINITIONS
 
In addition to the terms defined above, the following terms, as used in the
Stipulation, shall have the meanings specified below:
 
                Section 1.1    “Defendants” are the defendants who have not been
previously dismissed from the Consolidated Action.  Those defendants are Value
Line, Buttner, Henigson, Brecher, E_Buttner, and AB&Co.
 
        Section 1.2    “Effective Date” means the first date by which all of the
events and conditions specified in Section 6.1 of the Stipulation have been met
and have occurred.
 
Section 1.3     “Escrow Agent” means an escrow agent jointly selected by
Plaintiffs and the Defendants and approved by the Court.
 
Section 1.4    “Final Court Approval” means: (a) the date of final affirmance of
the Judgment (as defined below) on an appeal from the Judgment, the expiration
of the time for a petition for a writ of certiorari to review the Judgment and,
if certiorari be granted, the date of final affirmance of the Judgment following
review pursuant to that grant; or (b) the later of the date of final dismissal
of any appeal from the Judgment, including the expiration of the time for filing
a petition for a writ of certiorari therefrom, or the final dismissal of any
proceeding on certiorari to review the Judgment, without material modification
to the Judgment; or (c) if no appeal is filed, the expiration date of the time
for the filing or noticing of any appeal from the Judgment approving the
Stipulation substantially in the form of Exhibit “A” hereto; i.e., thirty (30)
days after entry of the Judgment, or such longer time to appeal after the entry
of the Judgment as allowed by order of the Court.  An appeal or petition for a
writ of certiorari pertaining solely to any plan of allocation or application
for attorneys’ fees, costs or expenses, shall not in any way delay or preclude
the Judgment from becoming final.
 
Section 1.5     “Former Defendants” means Pardes, Shanahan, Ruth and Eakman.
 
 
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Section 1.6     “Judgment” means the proposed Order and Final Judgment in the
form attached hereto as Exhibit “A.”
 
Section 1.7     “Notice” is defined as the notice referred to in Section 2.4
that the Court, in its discretion, may direct to be given to Value Line’s
shareholders.
 
Section 1.8    “Person” means an individual, corporation, partnership, limited
partnership, association, joint stock company, estate, legal representative,
trust, unincorporated association, government or any political subdivision or
agency thereof, and any business or legal entity and their spouses, heirs, any
members of his/her family, predecessors, successors, representatives, or
assignees.
 
Section 1.9     “Released Claims” means “Released Claims against Defendants and
Former Defendants” and/or “Released Claims against Plaintiffs.”
 
Section 1.10   “Released Claims against Defendants and Former Defendants” shall
mean and include any and all claims whatsoever, causes of action, demands,
rights, suits, or liabilities, whatsoever, whether the claims are individual or
otherwise in nature, based on federal, state, local, statutory or common law or
any other law, rule or regulation, both known claims or unknown claims,
including but not limited to claims for negligence, gross negligence,
professional negligence, breach of duty of care or breach of duty of loyalty or
breach of the duty of candor, fraud, breach of fiduciary duty, mismanagement,
corporate waste, malpractice, breach of contract, negligent misrepresentation,
violations of any state statutes, or federal statutes, rules or regulations, and
any “Unknown Claims” (as defined below), arising from the beginning of the world
to the date of the execution of this Settlement Agreement, including, but not
limited to, Unknown Claims arising out of or relating to the allegations,
matters and transactions in the Complaint, whether direct or derivative, that
have been or that could have been asserted in the Consolidated Action, or
arising out of or relating to the SEC Order, in this or any other forum by Value
Line or any of its current shareholders or their lawyers against the Released
Persons.  The Released Claims against Defendants and Former Defendants does not
include claims arising from or relating to the restructuring of Eulav
Securities, Inc. that was described and disclosed in the Form 8-K filed by Value
Line with the SEC on December 27, 2010.
 
 
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Section 1.11   “Released Claims against Plaintiffs” means any and all claims,
rights or causes of action or liabilities whatsoever, whether based on federal,
state, local, statutory or common law or any other law, rule or regulation,
including both known claims and Unknown Claims, arising out of or relating to
the allegations, matters and transactions in the Complaint that have been or
could have been asserted in the Consolidated Action, or arising out of or
relating to the SEC Order, in this or any forum by the Defendants or any of
their successors and assigns against any of the Plaintiffs or their attorneys
regarding this lawsuit.
 
Section 1.12  “Released Persons” means each of the Defendants, Former
Defendants, and Value Line.  “Released Persons” also includes the Defendants’,
Former Defendants’ and Value Line’s respective past or present directors,
officers, employees, partners, members, principals, agents, underwriters,
insurers, co-insurers, reinsurers, controlling shareholders, attorneys,
accountants or auditors, banks or investment banks, associates, personal or
legal representatives, estates, predecessors, successors, parents, subsidiaries,
divisions, assigns, spouses, heirs, related or affiliated entities, any entity
in which Value Line or any of the Released Persons has a controlling interest,
any members of his/her family, or any trust of which any of the Defendants or
Former Defendants is the settlor or which is for the benefit of any of the
Defendants or Former Defendants or their families.
 
 
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Section 1.13  “Releasing Parties” means any of the parties releasing claims
pursuant to Sections 1.09 – 1.11, including each of the (a) Plaintiffs, (b)
shareholders of Value Line or their lawyers, (c) Defendants and/or (d) each of
their successors and/or assigns.
 
Section 1.14   “Scheduling Order” means the Scheduling Order determined by the
Court.
 
Section 1.15   “Settlement Amount” means the aggregate sum of two million nine
hundred thousand dollars ($2,900,000.00) being paid by or on behalf of
Defendants in order to settle all claims known or unknown that could have been
asserted in this Consolidated Action.  The $2,900,000 Settlement Amount includes
(a) the Plaintiffs’ legal fees, (b) the Escrow Agent’s fees, professional fees,
and expenses, (c) the transfer agent’s, if any, fees and expenses, (d) all other
expenses of Plaintiffs and any other expenses associated with the enforcement of
the settlement, and (e) all costs set forth in Section 2.4, including the cost
for filing the Form 8K notice.  The Settlement Amount is not being paid by or on
behalf of Value Line.
 
Section 1.16   “Settling Parties” means, collectively, the Defendants and the
Plaintiffs on behalf of themselves and derivatively on behalf of Value Line.
 
Section 1.17  “Shareholder(s)” means any record or beneficial holder(s) of
shares of Value Line, Inc. common stock on the day the Court approves the
Stipulation, except for Defendants and any members of their immediate
families.  “Immediate families” shall mean the following individuals: for each
of the Defendants, his/her parents, spouse, children, and any other relatives
who are financially supported.
 
 
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Section 1.18   “Unknown Claims” means any claims that any of the Releasing
Parties do not know or suspect to exist, which, if known by him, her, or it,
might affect, or might have affected his, hers, or its settlement with and
release of the Released Persons.  With respect to the Released Claims, to the
fullest extent permitted by law, the Parties stipulate and agree that upon Final
Court Approval of the Settlement the Releasing Parties shall be deemed to have,
and by operation of the Judgment shall have expressly waived and relinquished
the provisions, rights, and benefits of Section 1542 of the California Civil
Code, and of any law, regulation or provision of any code of civil procedure of
any other jurisdiction within or outside of the United States which is similar,
comparable, or equivalent to Section 1542 of the California Civil Code, which
provides as follows:
 
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH
IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH
THE DEBTOR.
 
The Releasing Parties may hereafter discover facts in addition to or different
from those which any of them now knows or believes to be true with respect to
the subject matter of the Released Claims, but the Releasing Parties, upon Final
Court Approval, shall be deemed to have, and by operation of the Judgment shall
have fully, finally and forever settled and released any and all Released
Claims, known or unknown, suspected or unsuspected, contingent or
non-contingent, whether or not concealed or hidden, which now exist, or
heretofore have existed upon any theory of law or equity now existing or coming
into existence in the future, including, but not limited to, conduct which is
negligent, reckless, intentional, with or without malice, or a breach of any
duty, law or rule, without regard to the subsequent discovery or existence of
such different or additional facts.
 
Section 1.19   “Value Line” means nominal defendant Value Line, Inc., a New York
corporation, and all of its predecessors, successors, and all present and former
parents, subsidiaries, divisions, and related or affiliated entities.
 
 
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SETTLEMENT CONSIDERATION
 
Section 2.1    Within fifteen (15) business days of Final Court Approval,
AB&Co., as agent for all of the defendants, shall pay the Settlement Amount into
an interest bearing account maintained by the Escrow Agent, subject to Court
oversight.  The Settlement Amount, together with any accrued interest, shall
constitute the “Settlement Fund.”   Payment as set forth herein will constitute
satisfaction of all financial obligations of the Stipulation.
 
Section 2.2     The Escrow Agent shall invest the Settlement Fund in instruments
backed by the full faith and credit of the United States Government or fully
insured by the United States Government or the FDIC and shall reinvest the
proceeds of these instruments as they mature in the same types of instruments at
their then current market rates.
 
Section 2.3     The Settling Parties and the Escrow Agent agree to treat
the  Settlement Fund as being at all times a “qualified settlement fund” within
the meaning of Treas. Reg. §1.468B-1.  The Escrow Agent shall timely make such
elections as necessary or advisable to carry out the provisions of this Section
2.3, including the “relation-back election” (as defined in Treas. Reg.
§1.468B-1) back to the earliest permitted date.  Such elections shall be made in
compliance with the procedures and requirements contained in such
regulations.  It shall be the responsibility of the Escrow Agent to prepare
properly and timely deliver the necessary documentation for signature by all
necessary parties, and thereafter to cause the appropriate filing to occur.
 
 
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For the purpose of §468B of the Internal Revenue Code of 1986, as amended, and
the regulations promulgated thereunder, the “administrator” shall be the Escrow
Agent.  The Escrow Agent shall satisfy the administrative requirements imposed
by Treas. Reg. §1.468B-2 by, e.g., and be responsible for properly (i) obtaining
a taxpayer identification number, (ii) satisfying any information reporting or
withholding requirements imposed on disbursements from the Settlement Fund, and
(iii) timely and properly filing applicable federal, state and local tax returns
necessary or advisable with respect to the Settlement Fund (including, without
limitation, the returns described in Treas. Reg. §1.468B-2(k)) and properly
paying any taxes reported thereon out of the Settlement Fund.  Such returns (as
well as the election described in this Section 2.3) shall be consistent with
this Section 2.3 and in all events shall reflect that all Taxes as defined in
subsection (b) below (including any estimated Taxes, interest or penalties) on
the income earned by the Settlement Fund shall be paid out of the Settlement
Fund.
 
All (i) taxes (including any estimated taxes, interest or penalties) arising
with respect to the income earned by the Settlement Fund, including, without
limitation, any taxes or tax detriments that may be imposed upon the Defendants
or their counsel with respect to any income earned by the Settlement Fund for
any period during which the Settlement Fund does not qualify as a “qualified
settlement fund” for federal or state income tax purposes (collectively,
“Taxes”), and all (ii) expenses and costs incurred in connection with the
operation and implementation of this Section 2.3, including, without limitation,
expenses of tax attorneys and/or accountants and the fees and costs, if any, of
the Escrow Agent and mailing and disbursement costs and expenses relating to
filing (or failing to file) the returns described in this Section 2.3
(collectively, “Tax Expenses”), shall be paid out of the Settlement Fund; in all
events neither the Defendants, nor the Former Defendants, nor their counsel
shall have any liability or responsibility for any Taxes or the Tax Expenses or
for any taxes (including estimated taxes, interest or penalties) payable by any
person who receives any payment out of the Settlement Fund.  Further, Taxes and
Tax Expenses shall be treated as, and considered to be part of the Settlement
Fund and shall timely be paid by the Escrow Agent out of the Settlement Fund
without prior order from the Court and the Escrow Agent shall be obligated
(notwithstanding anything herein to the contrary) to withhold from distribution
to Value Line shareholders who receive distributions from the Settlement Fund
any funds necessary to pay such amounts, including the establishment of adequate
reserves for any Taxes and Tax Expenses (as well as any amounts that may be
required to be withheld under Treas. Reg. §1.468B-2(1)(2)); neither the
Defendants nor their counsel are responsible therefor, nor shall they have any
liability therefor.  The Settling Parties agree to cooperate with the Escrow
Agent, each other, and their tax attorneys and accountants to the extent
necessary to carry out the provisions of this Section 2.3.
 
 
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The Escrow Agent and/or transfer agent must follow the tax opinion of Value
Line’s tax counsel.
 
Section 2.4     All funds held by the Escrow Agent shall be deemed and
considered to be in custodia legis, and shall remain subject to the jurisdiction
of the Court.  All amounts in the Settlement Fund, after deducting any Taxes,
any Tax Expense, any expenses of the Escrow Agent including his fees in
performing his duties hereunder, and all expenses in connection with this
Settlement and any award by the Court of attorneys’ fees and expenses to
Plaintiffs’ Counsel, shall be distributed to all Shareholders.  Notwithstanding
the foregoing, any unclaimed amount remaining in the Settlement Fund reverts
back to the Defendants on or before December 31, 2012.   In addition, if the
Court directs one or more of the parties to give Notice to Value Line’s
shareholders of this Settlement, then the parties agree that all costs, fees,
and expenses relating to the Notice will be deducted from the Settlement
Fund.  If the Notice is in the form of a Form 8K, the costs for Edgarizing,
preparing and printing the Notice will be deducted from the Settlement Fund.
 
 
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Section 2.5     AB&Co. agrees: (i) at each of the next five (5) meetings of the
shareholders of Value Line, it will vote its shares of Value Line to elect to
the Value Line Board of Directors a new, independent non-management director
(who need not be in addition to the number of directors currently serving) who
qualifies as an “audit committee financial expert” within the meaning of the
applicable rules promulgated by the SEC pursuant to Section 407 of the
Sarbanes-Oxley Act of 2002; and (ii) to request that the Value Line Board of
Directors appoint an “audit committee financial expert” within the meaning of
the applicable rules promulgated by the SEC pursuant to Section 407 of the
Sarbanes-Oxley Act of 2002 to serve on the Value Line Audit Committee who need
not be the same individual throughout the time period or the same new
non-management director.
 
Section 2.6     The individual Plaintiffs, Alan R. Kahn and Larry Morrison,
agree that they will not sue AB&Co. and its affiliates and/or Value Line and its
affiliates or any of those entities’ respective past, present or future
directors, officers or employees in a class action or derivative action in
Plaintiffs’ capacity as shareholders of Value Line, provided, however, that
Plaintiffs may sue to enforce the terms of this settlement if approved by the
Court.  
 
SCEHDULING ORDER, SETTLEMENT HEARING
 
Section 3.1     As promptly as practicable following execution of the
Stipulation, Plaintiffs’ Counsel shall file a motion for entry of a scheduling
order that is agreed to by both parties and will, among other things, schedule a
final hearing on the Settlement.
 
In addition, if the Court, in its discretion, directs that Notice should be
given to Value Line’s shareholders, then a Notice will be jointly drafted for
dissemination to Value Line’s shareholders.  As noted, the parties agree that
all costs, fees, and expenses relating to the Notice, including the costs for
distribution and/or publication of the Notice will be deducted from the
Settlement Fund.
 
 
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RELEASE OF CLAIMS
 
Section 4.1     Upon the Effective Date, the Plaintiffs, and all other Value
Line Shareholders, and Value Line shall be deemed to have, and by operation of
the Judgment shall have, fully, finally, and forever released, relinquished, and
discharged all Released Claims against the Released Persons and their
lawyers.  Nothing herein, however, shall preclude any Settling Party from
enforcing the terms of the Stipulation.
 
Section 4.2     Upon the Effective Date, the Defendants shall be deemed to have,
and by operation of the Judgment shall have, fully, finally and forever
released, relinquished, and discharged the Plaintiffs and their counsel, each
only in his or its capacity as such, from all Released Claims against
Plaintiffs.  Nothing herein, however, shall prelude any Settling Party from
enforcing the terms of the Stipulation.
 
ATTORNEY’S FEES, COSTS, AND EXPENSES
 
Section 5.1     The parties agree that the amount of attorneys’ fees and
expenses awarded from the Settlement Fund shall be reasonable.  Plaintiffs’
Counsel may submit an application to the Court (the “Fee and Expense
Application”) for distributions to them from the Settlement Fund for an award of
attorneys’ fees and expenses of up to one-third (33-1/3%) of the Settlement
Fund.  Plaintiffs and their counsel shall be reimbursed solely out of the
Settlement Fund.  The Defendants shall not be liable for any costs, fees, or
expenses of any of the Plaintiffs’ attorneys, experts, advisors agents or
representatives.  All such costs, fees and expenses as approved by the Court
shall be paid out of the Settlement Fund within five business days of the later
of (a) the Effective Date or (b) the entry of the order awarding such fees and
expenses (the “Final Fee Award”).  In the event that the Final Fee Award  is
reversed or modified following payment of fees and expenses to Plaintiffs’
Counsel pursuant to Court order, Plaintiffs’ Counsel shall within five (5)
business days from receiving notice from Defendants’ counsel or from a court of
appropriate jurisdiction, refund to the Settlement Fund, out of the fees and
expenses previously paid to them from the Settlement Fund plus interest thereon
at the same rate as earned on the Settlement Fund, an amount consistent with
such reversal or modification.  Each such counsel’s law firm, as a condition of
receiving such fees and expenses, on behalf of itself and each partner, member
or shareholder of it, agrees that the law firm and its partners, shareholders or
members are subject to the jurisdiction of the Court for the purpose of
enforcing the provisions of this paragraph.
 
 
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Section 5.2     The procedure for and the allowance or disallowance by the Court
of the Fee and Expense Application, and any other fair and reasonable fees
requested, are not part of the settlement set forth in this Stipulation, and are
to be considered by the Court separately from the Court’s consideration of the
fairness, reasonableness, and adequacy of the settlement.  Notwithstanding the
foregoing, all such fees and expenses that are awarded will be deducted from and
come out of the Settlement Fund, it being understood that Defendants will not
pay more than $2,900,000 to settle this Consolidated Action, which amount
includes all costs, fees, and other expenses related to and/or are set forth in
the terms of this Stipulation.  Any order or proceedings relating to the Fee and
Expense Application, or any appeal from any order relating thereto or reversal
or modification thereof, shall not operate to terminate or cancel the
Stipulation, or affect or delay the finality of the Judgment approving the
Stipulation and the settlement of the Consolidated Action set forth therein.
 
 
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Section 5.3     Except for the obligation of Defendants to pay the Settlement
Amount, none of the Defendants shall have any responsibility for, or liability
with respect to, any payment to Plaintiffs’ Counsel or any other counsel or
Person who receives payment from the Settlement Fund, nor with respect to the
allocation among Plaintiffs’ Counsel or any other Person who may assert some
claim thereto, of any award of fees and expenses that the Court may make in the
Consolidated Action.
 
CONDITIONS
 
Section 6.1     The Effective Date of the Stipulation shall be conditioned on
and subject to the occurrence of all of the following events:
 
(a) The Court has entered the Judgment, or a Judgment substantially in the form
of Exhibit “A” hereto;
 
(b) That Judgment has become Final and Non-Appealable;
 
(c) The Consolidated Action has been dismissed with prejudice; and
 
(d) The Judgment for all fees, expenses, and the Settlement Fund monies relating
to this case shall not exceed $2,900,000.
 
In the event that the Stipulation is not approved by the Court or the settlement
set forth in the Stipulation is terminated or fails to become effective in
accordance with its terms, the then the Stipulation shall be canceled and
terminated and the Settling Parties shall be restored to their respective
positions in the Consolidated Action prior to execution of the Stipulation.  In
such event, the terms and provisions of the Stipulation shall have no further
force and effect and shall not be used in this Consolidated Action or in any
other proceeding for any adverse purpose or inference, and any Judgment or order
entered by the Court in accordance with the terms of the Stipulation shall be
treated as vacated, nunc pro tunc.
 
 
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MISCELLANEOUS PROVISIONS
 
Section 7.1     The Settling Parties agree to cooperate to the extent necessary
to effectuate and implement all terms and conditions of the Stipulation.  The
Stipulation shall be construed and interpreted to effectuate the intent of the
Settling Parties, which is to provide, though the Stipulation, for a complete
resolution of the Released Claims with respect to each of the Released Persons
and/or Settling Parties.
 
Section 7.2    Neither the Stipulation (whether or not it becomes final) nor the
Judgment, nor any and all negotiations, documents, and discussions associated
with them, as well as any other matters pertaining thereto, shall be deemed or
construed to be an admission by Defendants or evidence of any violation of any
statute or law or of any liability or wrongdoing whatsoever or of the truth of
any of the claims or allegations contained in the Complaint or any other
pleading filed by Plaintiffs and evidence thereof shall not be discoverable or
used directly or indirectly, in any way, whether in the Consolidated Action or
in any other action or proceeding.  The Defendants may file the Stipulation or
the Judgment in any action.
 
Section 7.3     The Stipulation may be amended or modified only by a written
instrument signed by or on behalf of all Settling Parties or their respective
successors-in-interest.
 
 
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Section 7.4     The Stipulation and Exhibit attached thereto constitutes the
entire agreement among the parties hereto and no representations, warranties or
inducements have been made to any party concerning the Stipulation or its
Exhibit other than the representations, warranties and covenants contained and
memorialized in such documents.  Except as otherwise provided therein, each
party shall bear its own costs.  The escrow costs and all other fees and
expenses relating to payments to Plaintiffs and to the distribution of moneys
and taxes shall be part of the $2.9 million Settlement Fund and shall be paid
from the Settlement Fund provided the stipulation is approved by the Judgment
described in Section 6.1 hereof.
 
Section 7.5     Each counsel or other Person executing the Stipulation or its
Exhibit on behalf of any party hereto warrants that such person has the full
authority to do so.
 
Section 7.6     The Stipulation may be executed in one or more
counterparts.  All executed counterparts and each of them shall be deemed to be
one and the same instrument. A complete set of original executed counterparts
shall be filed with the Court.
 
Section 7.7      The Stipulation shall be binding upon, and inure to the benefit
of, the successors and assigns of the parties hereto.
 
Section 7.8     The Court shall retain jurisdiction with respect to
implementation and enforcement of the terms of the Stipulation, and all parties
hereto submit to the jurisdiction of the Court for purposes of implementing and
enforcing the settlement embodied in the Stipulation.
 
Section 7.9     The Stipulation and the Exhibit hereto shall be considered to
have been negotiated, executed and delivered, and to be wholly performed, in the
State of New York, and the rights and obligations of the parties to the
Stipulation shall be construed and enforced in accordance with, and governed by,
the internal laws of the State of New York without giving effect to that State’s
choice of law principles.
 
 
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Section 7.10   The Stipulation shall not be construed more strictly against one
party than another merely by virtue of the fact that it, or any part of it, may
have been prepared by counsel for one of the parties, it being recognized that
it is the result of arm’s length negotiations between the parties and all
parties have been represented by counsel and have contributed substantially and
materially to the preparation of the Stipulation.
 
STIPULATED AND AGREED:

/s/ Jeffrey S. Abraham   /s/ Tab K. Rosenfeld
Jeffrey S. Abraham
 
Tab K. Rosenfeld
Philip T. Taylor
 
ROSENFELD & KAPLAN LLP
ABRAHAM, FRUCHTER & TWERSKY, LLP
 
535 Fifth Avenue, Suite 1006
One Penn Plaza, Suite 2805
 
New York, New York 10017
New York, New York 10119
 
Tel: 212-682-1400
Tel: 212-279-5050
   
 
 
Attorneys for Defendants Jean Bernhard
   
Buttner, David T. Henigson, Edgar A. Buttner,
   
Howard A. Brecher and Arnold Bernhard & Co., Inc.
/s/ Harold B. Obstfeld   /s/ David Etkind
Harold B. Obstfeld
 
David Etkind
HAROLD B. OBSTFELD, P.C.
 
ECHTMAN & ETKIND, LLP
100 Park Avenue, 20th Floor
 
12 Marlette Place
New York, New York 10017
 
White Plains, New York 10605
Tel: 212-696-1212
 
Tel: 212-757-2310
      /s/ James S. Notis  
Attorneys for Nominal Defendant Value Line, Inc.
James S. Notis
 
 
GARDY & NOTIS, LLP
   
560 Sylvan Avenue
   
Englewood Cliffs, New Jersey 07632
   
Tel: 201-567-7377
         
Attorneys for Plaintiffs
   

 
 
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