THE PEREGRINE REAL ESTATE TRUST
0000 XXXXX XXX, XXXXX 000
XXXXXXXXXX, XXXXXXXXXX 00000
November 2, 1998
To each of the parties listed
on the signature pages hereto
Gentlemen:
This letter agreement (the "Letter Agreement") is entered into by and
among The Peregrine Real Estate Trust, a California real estate investment trust
(the "Company"); The Prudential Insurance Company of America and Gateway
Recovery Trust (collectively, the "Prudential Entities"); TCW Special Credits
Fund IV, TCW Special Credit Plus Fund, TCW Special Credits Trust IV, TCW Special
Credits Trust IVA and TCW Special Credits, as investment manager of the
Weyerhaeuser Company Master Retirement Trust Separate Account (collectively,
"TCW"); OCM Real Estate Opportunities Fund A, L.P., OCM Real Estate
Opportunities Fund B, L.P., and Oaktree Capital Management, LLC as investment
manager of Weyerhaeuser Company Master Retirement Trust and Real Estate
Opportunities Separate Account (collectively, "Oaktree"). The Prudential
Entities, TCW and Oaktree are collectively referred to herein as the "Preferred
Stockholders".
The Company and Preferred Stockholders hereby agree, subject to the
terms and conditions set forth in this Letter Agreement as follows:
DEFINITIONS
"Common Stock" shall mean Common Shares of beneficial interest of the
Company authorized and issued pursuant to the Declaration of Trust.
"Declaration of Trust" shall mean the Restated Declaration of Trust of
the Company dated as of October 7, 1994.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Preferred Stock" shall mean Preferred Shares of beneficial interest
of the Company issued pursuant to the Declaration of Trust and that certain
Redeemable Convertible Preferred Stock Purchase Agreement dated as of October 1,
1994 by and among the Company and Pacific Mutual Life Insurance Company, The
Prudential Insurance Company of America, Pruco Life Insurance Company, ORIX USA
Corporation, Weyerhauser Company Master
Retirement Trust, TCW Special Credits Fund IV, TCW Special Credits Plus Fund,
TCW Special Credits Trust IV, and TCW Special Credits Trust IVA.
"SEC" shall mean the United States Securities and Exchange Commission.
"Securities" shall mean the Preferred Stock and Common Stock
(including Conversion Shares (as defined herein)).
"Securities Act" shall mean the Securities Act of 1933, as amended.
Section 1 EXCHANGE OF PREFERRED STOCK FOR COMMON STOCK
1.1 EXCHANGE. Subject to the terms and conditions set forth herein,
each of the Preferred Stockholders hereby agrees to exchange each share of
Preferred Stock held by such Preferred Stockholder for a number of shares of
Common Stock to be issued by the Company pursuant to the following conversion
ratio (the "Conversion Shares"): (a) the sum of (i) the number of shares of
Preferred Stock that would have been issued and outstanding on October 10, 1998
if the Preferred Stock issued and outstanding as of the Closing Date (as defined
herein) had remained outstanding until and as of such date (it being agreed that
such number of shares of Preferred Stock is 16,764,135) plus (ii) the quotient
of (A) the amount of cash dividends that would have accrued on the Preferred
Stock between the date of this Agreement and April 10, 1999 (it being agreed
that such amount is $1,814,364) divided by (B) the conversion price set forth in
the Declaration of Trust (it being agreed that such amount is $2.00), divided by
(b) the number of shares of Preferred Stock issued and outstanding as of the
Closing Date (as defined herein). Subject to the terms and conditions set forth
herein, the Company hereby agrees to issue the Conversion Shares upon receipt of
share certificates representing all of the issued and outstanding shares of
Preferred Stock from the Preferred Stockholders.
1.2 THE CLOSING. At the closing of the transactions described herein
(the "Closing"), (a) each of the Preferred Stockholders will deliver to the
Company the certificates evidencing the shares of Preferred Stock held by such
holder together with duly executed blank stock powers, (b) the Company will
accept and cancel such certificates representing shares of Preferred Stock and
(c) the Company will deliver to Preferred Stockholders certificates for the
Conversion Shares, registered in the denominations and names specified by each
Preferred Stockholder. The Closing shall be held at the offices of Milbank,
Tweed, Xxxxxx & XxXxxx, 000 X. Xxxxxxxx Xx., thirtieth floor, Xxx Xxxxxxx,
Xxxxxxxxxx 00000, on the third business day following satisfaction of the
conditions set forth herein or at such other time and place as all parties to
this Letter Agreement may mutually agree (the "Closing Date").
Section 2 REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents, warrants and covenants to each
Preferred Stockholder as follows:
2.1 ORGANIZATION; POWER AND AUTHORITY. The Company is a real estate
investment trust duly organized, validly existing and in good standing under the
laws of the State
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of California. The Company has all requisite power and authority to transact
its business as now transacted and proposed to be transacted, to execute and
deliver this Agreement, to issue and exchange the Conversion Shares for the
Preferred Shares and to perform the provisions of this Letter Agreement.
2.2 AUTHORIZATION, ETC. The execution, delivery and performance of
this Letter Agreement and the other documents contemplated herein to which the
Company is a party, the issuance and exchange of Conversion Shares for the
Preferred Stock, and the consummation of the transactions contemplated hereby
and thereby have been duly authorized by all necessary action on the part of the
Company, and this Letter Agreement has been executed and delivered by the
Company, and this Letter Agreement constitutes a legal, valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms.
2.3 CAPITAL STOCK. The total number of shares of capital stock which
the Company has authority to issue is 75,000,000 shares, consisting of
50,000,000 shares of Common Stock and 25,000,000 shares of Preferred Stock. As
of October 1, 1998, the total number of outstanding shares of Common Stock was
4,881,122, the total number of outstanding shares of Preferred Stock was
16,764,135 and there were options and warrants to purchase an aggregate of
119,998 shares of Common Stock outstanding and options to purchase 1,450,000
shares of Common Stock had been granted subject to shareholder approval.
2.4 ISSUANCE OF THE CONVERSION SHARES. Upon issuance, the Conversion
Shares will be duly authorized, validly issued, outstanding, fully paid and
non-assessable. The delivery to each Preferred Stockholder of a certificate or
certificates representing the Conversion Shares at the Closing will transfer to
such Preferred Stockholder good and valid title to the Conversion Shares which
it is entitled to receive hereunder, free and clear of all liens and
encumbrances.
2.5 COMPLIANCE WITH LAWS, OTHER INSTRUMENTS OF THE COMPANY, ETC.
Except as described in Schedule 2.5 hereto, none of the execution and delivery
of this Letter Agreement, or the issuance and exchange of the Conversion Shares
for Preferred Stock or the consummation of the transactions contemplated herein
or compliance with the terms and provisions hereof will conflict with or result
in a breach of, or require any consent under, the Restated Declaration of Trust
or Bylaws of the Company, any applicable law or regulation (other than filings
which will be made by the Company as required by applicable state securities
laws), or any order, writ, injunction or decree of any court or governmental
authority or agency, or any agreement or instrument to which the Company is a
party or by which it is bound or to which it is subject, or constitute a default
under any such agreement or instrument, or result in the creation or imposition
of any lien upon any of the revenues or assets of the Company pursuant to the
terms of any such agreement or instrument.
2.6 GOVERNMENTAL CONSENTS. Other than filings required by applicable
state securities laws which shall be made by the Company, neither the nature of
the Company or of any of its respective businesses or properties, nor any
relationship between the Company and any other person, nor any circumstance in
connection with the offer, issue or exchange of the Securities is such as to
require consent, approval or authorization of, or filing, registration or
qualification with, any governmental authority on the part of the Company as a
condition to the execution, delivery or performance of this Letter Agreement.
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2.7 LEGAL PROCEEDINGS. There are no legal actions or proceedings
pending, or to the knowledge of the Company, threatened against, relating to or
affecting the Company which request or threaten to request the issuance of a
court order restraining, enjoining or otherwise prohibiting or making illegal
the consummation of any of the transactions contemplated in this Letter
Agreement (or any similar transaction).
Section 3 REPRESENTATIONS AND WARRANTIES OF THE PREFERRED
STOCKHOLDERS.
Each of the Preferred Stockholders, severally and not jointly,
represents, warrants and covenants to the Company and each other Preferred
Stockholder as follows:
3.1 ORGANIZATION; POWER AND AUTHORITY; AUTHORIZATION, ETC. Such
Preferred Stockholder has all requisite power and authority to execute and
deliver this Letter Agreement and to perform its obligations pursuant to the
provisions of this Letter Agreement. The execution, delivery and performance of
this Letter Agreement, and the consummation of the transactions contemplated
hereby have been duly authorized by all necessary action on the part of such
Preferred Stockholder. This Letter Agreement has been executed and delivered by
a duly authorized representative of such Preferred Stockholder and constitutes a
legal, valid and binding obligation of such Preferred Stockholder enforceable
against such holder in accordance with its terms.
3.2 OWNERSHIP OF SHARES. Such Preferred Stockholder represents that
such Preferred Stockholder is the sole legal owner of the number of shares of
Preferred Stock set forth opposite such holder's name on Schedule 3.2. Such
Preferred Stockholder holds such shares of Preferred Stock of the Company free
and clear of any liens, claims, interests, charges and encumbrances. Such
Preferred Stockholder represents that it has not previously entered into any
agreement (other than this Agreement) to sell, assign, convey, transfer or
otherwise dispose of, in whole or in part, the shares of Preferred Stock to be
exchanged by such Preferred Stockholder pursuant to the terms hereof. Upon
exchange of the Preferred Stock for the Conversion Shares at the Closing, such
Preferred Stockholder will transfer to the Company, good and valid title to the
Preferred Stock held by such holder, free and clear of all liens, claims,
interests, charges and encumbrances.
3.3 ACQUISITION FOR EACH OF THE PREFERRED STOCKHOLDERS' OWN ACCOUNT;
RESTRICTIONS ON TRANSFER; ACCREDITED INVESTORS. Such Preferred Stockholder
represents and warrants to the Company that it is acquiring and will acquire the
Conversion Shares for its own account (or a separate account managed by it),
with no present intention of distributing or reselling its Conversion Shares or
any part thereof in violation of the Securities Act, and that such Preferred
Stockholder is prepared to bear the economic risk of retaining its Conversion
Shares for an indefinite period of time, all without prejudice; provided that
the disposition of its property shall in all times be and remain with in its
control. Such Preferred Stockholder represents and warrants that it is an
"accredited investor," as such term is defined in Rule 501(a)(3) of Regulation D
promulgated under the Securities Act. Such Preferred Stockholder further
covenants that it will not make any sale, transfer or other disposition of the
Securities of the Company in violation of the Securities Act, the Exchange Act
or the rules of the SEC promulgated thereunder.
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3.4 COMPLIANCE WITH LAWS, OTHER INSTRUMENTS OF EACH OF PREFERRED
STOCKHOLDERS, ETC. Except as described in Schedule 3.4 hereto, none of the
execution and delivery of this Letter Agreement, or the issue and exchange of
the Conversion Shares for Preferred Stock or the consummation of the
transactions contemplated herein or compliance with the terms and provisions
hereof will conflict with or result in a breach of, or require any consent
under, organic foundation documents or bylaws of such Preferred Stockholder any
applicable law or regulation, or any order, writ, injunction or decree of any
court or governmental authority or agency, or any agreement or instrument to
which such Preferred Stockholder is a party or by which it is bound or to which
it is subject, or constitute a default under any such agreement or instrument,
or result in the creation or imposition of any lien upon any of the revenues or
assets of such Preferred Stockholder pursuant to the terms of any such agreement
or instrument.
3.5 GOVERNMENTAL CONSENTS. Neither the nature of such Preferred
Stockholder or of any of its respective businesses or properties, nor any
relationship between such Preferred Stockholder and any other person, nor any
circumstance in connection with the offer, issue or exchange of the Securities
is such as to require consent, approval or authorization of, or filing,
registration or qualification with, any governmental authority on the part of
such Preferred Stockholder as a condition to the execution, delivery or
performance of this Letter Agreement.
Section 4 COVENANTS OF THE COMPANY
The Company hereby covenants and agrees with the Preferred
Stockholders that all times from and after the date hereof until the Closing
and, with respect to any covenant to be performed in whole or in part after the
Closing, to the period specified therein or if no period is specified,
indefinitely:
4.1 FAIRNESS OPINION. The Company shall use commercially reasonable
efforts to obtain an independent "fairness" opinion from a recognized investment
banking firm addressed to the trustees of the Company, together with a letter
permitting the Company to deliver the fairness opinion to each of the Preferred
Stockholders, and confirming that the transactions contemplated hereby are fair,
from a financial point of view, to the Company and the shareholders of the
Company other than the Preferred Stockholders.
4.2 CONSENTS. The Company shall use commercially reasonable efforts
to obtain the consents described in Schedule 2.5.
4.3 FULFILLMENT OF CONDITIONS. The Company will take all
commercially reasonable steps to satisfy conditions and obligations of the
Company under this Letter Agreement and will not take or fail to take any action
that could reasonably be expected to result in non-fulfillment of any such
condition or obligation under this Letter Agreement.
Section 5 CONDITIONS TO CLOSING.
(a) The obligations of each Preferred Stockholder hereunder are
subject to the satisfaction prior to the issuance of the Conversion Shares of
the following conditions:
(i) the Company shall have delivered to Preferred
Stockholders a certificate, dated as of the Closing Date, of the Secretary or an
Assistant Secretary of the
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Company, (A) attaching a true and complete copy of the resolutions of the Board
of Trustees of the Company, and of all documents evidencing other necessary
corporate or shareholder action taken by the Company in connection with the
matters contemplated by this Agreement, (B) attaching a true and complete copy
of the Restated Declaration of Trust, (C) setting forth the incumbency of the
officer or officers of the Company who sign this Letter Agreement, the other
Documents, and each certificate for the Conversion Shares, including therein a
signature specimen of such officer or officers, and (D) attaching a certificate
of good standing (including tax status, if applicable) of the California
Secretary of State;
(ii) the Company shall have received a "fairness" opinion, in
form and substance satisfactory to each of the Preferred Stockholders, from Duff
& Xxxxxx, LLC (or other recognized investment banking firm) addressed to the
trustees of the Company, together with a letter permitting the Company to
deliver the fairness opinion to each of the Preferred Stockholders, and
confirming that the transactions contemplated hereby are fair, from a financial
point of view, to the Company and the shareholders of the Company other than the
Preferred Stockholders.
(iii) all representations and warranties of the Company
contained in Section 2 shall be true in all material respects on and as of the
Closing Date with the same effect as though such representations and warranties
had been made on and as of the Closing Date (other than representations and
warranties that are dated as of a specified date earlier than the Closing Date,
which shall be certified to be true, correct and complete as of such earlier
date) the Company shall have performed all agreements on its part required to be
performed under this Letter Agreement on or prior to the Closing Date and
Preferred Stockholders shall have received a certificate signed by the chief
executive officer of the Company dated as of the Closing Date, certifying as to
the effect specified in this paragraph;
(iv) the Company shall have delivered to the Preferred
Stockholders such other documents, agreements, instruments, certificates and
evidence relating to the matters contemplated by this Letter Agreement as
Preferred Stockholders or its counsel shall reasonably require;
(v) since December 31, 1997, there shall have been no
material adverse change or development in the business, financial condition,
operating results, assets, operations, business prospects, cash flow, net worth
or any franchiser, customer, tenant, supplier or employee relationship of the
Company (each a "Material Adverse Effect");
(vi) the Company shall have delivered certificates
representing Conversion Shares to each of Preferred Shareholders;
(vii) all of the outstanding shares of Preferred Stock shall
have been tendered to the Company by Preferred Stockholders;
(viii) the Company shall have obtained the consents described in
Schedule 2.5 and each of the Preferred Stockholders shall have obtained the
consents discussed in Section 3.4;
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(ix) there shall not be any pending or threatened action or
proceeding (a) challenging this Agreement or the transactions contemplated
hereby or seeking monetary damages in connection therewith or (b) which, in the
reasonable judgement of any Preferred Stockholder, could be reasonably expected
to have a Material Adverse Effect on the Company; and
(x) the Company and each of the Preferred Stockholders shall
have executed and delivered an amendment to that certain Registration Rights
Agreement, dated as of October 1, 1994, by and among the Company and each of the
Preferred Stockholders (the "Registration Agreement") to clarify that (i)
Conversion Shares to be received by the Preferred Stockholders pursuant to the
transactions contemplated herein shall be subject to the registration rights
described in the Registration Agreement; and (ii) any and all securities that
the Preferred Stockholders may receive in exchange for or in respect of
Conversion Shares or thereafter shall be subject to the registration rights
described in the Registration Agreement; and
(xi) the Preferred Stockholders shall have received the
opinion of Milbank, Tweed, Xxxxxx & XxXxxx, counsel for the Company, in form and
substance reasonably acceptable to the Preferred Stockholders.
(b) The obligations of the Company hereunder are subject to the
satisfaction prior to the issuance of the Common Stock of the following
conditions:
(i) all representations and warranties of each of the
Preferred Stockholders contained in Section 3 shall be true in all material
respects on and as of the Closing Date with the same effect as though such
representations and warranties had been made on and as of the Closing Date; each
of the Preferred Stockholders shall have performed all agreements on its part
required to be performed under this Agreement or any other Document on or prior
to the Closing Date; and the Company shall have received a certificate signed by
an officer, or other comparable representative, of each of the Preferred
Stockholders dated as of the Closing Date, certifying as to the effect specified
in this paragraph;
(ii) each of the Preferred Stockholders shall have delivered
to the Company original certificates representing all shares of Preferred Stock
that it owns beneficially and stock powers duly executed or endorsed in blank;
(iii) the Company shall have received a "fairness" opinion in
form and substance satisfactory to the trustees of the Company and the Preferred
Stockholders, from Duff & Xxxxxx, LLC (or other recognized investment banking
firm) addressed to the trustees of the Company and confirming that the
transactions contemplated hereby are fair, from a financial point of view, to
the Company and the shareholders of the Company other than the Preferred
Stockholders and the Company shall have received a letter from Duff & Xxxxxx,
LLC permitting the Company to deliver such fairness opinion to each of the
Preferred Stockholders;
(iv) the Company shall have obtained the consents described in
Section 2.4 and each of the Preferred Stockholders shall have obtained the
consents discussed in Section 3.4; and
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(v) there shall not be pending or threatened any action or
proceeding challenging this Agreement or the transactions contemplated hereby or
seeking monetary damages in connection therewith.
Section 6 NOTICES
6.1 NOTICES.
(a) All communications under this Agreement shall be in writing and
shall be mailed by first class mail, postage prepaid:
(i) if to the Company, at
The Peregrine Real Estate Trust
0000 Xxxxx Xxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xx. Xxxxx Xxxxx
with copy to:
Milbank, Tweed, Xxxxxx & XxXxxx
000 Xxxxx Xxxxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxx, Esq.
(ii) if to TCW, at:
TCW Special Credits
c/o Oaktree Capital Management, LLC
000 Xxxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Mr. D. Xxxxxxx Xxxxxx
(iii) if to Prudential, at:
Prudential Insurance Company of America
Prudential Capital Group
0 Xxxxxxx Xxxxxx 0xx Xxxxx
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxx Xxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxxx
(iv) if to Oaktree, at:
Oaktree Capital Management, LLC
000 Xxxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Mr. D. Xxxxxxx Xxxxxx
or at such other address as each such party may have furnished in writing to
each other party to this Letter Agreement and all other holders of Shares at the
time outstanding.
-8-
(b) Any notice shall be deemed to have been duly given when delivered
by hand, if personally delivered, and if sent by mail, two business days after
being deposited in the mail, postage prepaid.
6.2 SURVIVAL. All warranties, representations and covenants made by
the parties herein or in any certificate or other instrument delivered by them
or on their behalf under this Letter Agreement shall survive for a period of one
year after the issuance of the Conversion Shares and the exchange of the
Preferred Stock, EXCEPT FOR the representations and warranties contained in
Sections 2.2, 2.3 and 3.2 which shall survive the issuance of the Conversion
Shares and the exchange of the Preferred Stock until expiration of the
applicable statutes of limitations. All statements in any such certificate or
other instrument so delivered shall constitute representations and warranties by
the Company hereunder.
6.3 INDEMNIFICATION. The Company shall indemnify each of the
Preferred Stockholders in respect of, and hold each of them harmless from and
against, any and all losses suffered, incurred or sustained by any of them or to
which any of them becomes subject, resulting from, arising out of or relating to
any breach of representation or warranty or nonfulfillment of or failure to
perform any covenant or agreement on the part of the Company contained in this
Letter Agreement.
6.4 SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided
herein, this Letter Agreement shall inure to the benefit of and be binding upon
the successors and assigns of each of the Preferred Stockholders, whether so
expressed or not. The Company may not assign its rights, nor to delegate its
duties, under this Letter Agreement.
6.5 AMENDMENT AND WAIVER, ETC. This Agreement may be amended, and
the observance of any term of this Letter Agreement may be waived, but only with
the written consent of each of the Preferred Stockholders. No supplement,
modification or waiver of this Agreement shall be binding unless executed in
writing by the Company and each of the Preferred Stockholders. No failure or
delay on the part of the Preferred Stockholders in exercising any right, power
or remedy hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right, power or remedy preclude any other or
further exercise thereof or the exercise of any other right, power or remedy.
No waiver of any of the provisions of this Letter Agreement shall be deemed to
be a waiver of any other provision hereof (whether or not similar), nor shall
such waiver constitute a continuing waiver unless otherwise expressly provided.
6.6 COUNTERPARTS. This Agreement may be executed in one or more
counterparts each of which shall be an original and all of which together shall
constitute one and the same instrument.
6.7 SEVERABILITY. In the event that any one or more of the
provisions contained in this Letter Agreement, or the application thereof in any
circumstance, is held invalid, illegal or unenforceable, the validity, legality
and enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired thereby.
-9-
6.8 SPECIFIC PERFORMANCE. The Company acknowledges that the
Preferred Stockholders have no adequate remedy at law for breaches by the
Company of its obligations hereunder, and accordingly the Company irrevocably
agrees that the Preferred Stockholders shall be entitled to the remedy of
specific performance and waives any right the Company may have to object to such
remedy.
6.9 EXPENSES. The Company will pay all costs and reasonable expenses
(including reasonable legal fees of one counsel to the Preferred Stockholders)
incurred by Preferred Stockholders including (a) costs and expenses relating to
the negotiation, execution and delivery of this Letter Agreement and any other
agreement, instrument, document, or certificate necessary to consummate the
transactions contemplated by this Letter Agreement and the issuance of
Conversion Shares, (b) transfer taxes, (c) costs and expenses relating to
printing the instruments evidencing the Conversion Shares, (d) costs and
expenses relating to any amendments, waivers or consents under this Letter
Agreement and (e) costs and expenses incident to the enforcement by Preferred
Stockholders of, or the protection or preservation of any right or remedy of any
Preferred Stockholder under, this Letter Agreement.
6.10 ENTIRE AGREEMENT. This Agreement, together with all Exhibits and
Schedules hereto, constitutes the entire agreement among the Company and
Preferred Stockholders pertaining to the subject matter hereof and supersedes
all prior agreements, understandings, negotiations and discussions, whether oral
or written, of the parties.
6.11 CHOICE OF LAW. This Letter Agreement shall be governed by, and
construed in accordance with, the laws of the State of California, without
giving effect to its principles of conflict of laws.
6.12 TERMINATION. This Letter Agreement shall terminate (a) at any
time prior to the Closing by mutual written agreement of the parties hereto or
(b) on or after December 31, 1998 by any of the Company or the Preferred
Stockholders if the Closing shall not have occurred on or prior to such date and
such failure to consummate is not caused by a breach by the terminating party.
If this Letter Agreement is validly terminated pursuant to clause (a) of the
first sentence of this Section 6.12, this Letter Agreement will forthwith become
null and void, and there will be no liability or obligation on the part of any
party hereto, except for the obligation of the Company to pay expenses pursuant
to Section 6.9. Upon termination of this Agreement pursuant to clause (b) of the
first sentence of this Section 6.12, the breaching party, if any, whose breach
has caused such termination will remain liable to the non-breaching party for
any breach of this Letter Agreement existing at the time of such termination,
and the non-breaching party may use such remedies, including damages and fees of
attorneys, against such breaching party with respect to such breach as are
provided for in this Letter Agreement or are otherwise available in law or
equity.
6.13 SHAREHOLDER LIABILITY. Each of the parties hereto agrees
that the shareholders of the Company are not personally liable for any written
contracts or agreements entered into by the Company and shall not be personally
liable for any obligation of the Company under this Agreement.
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If the foregoing is in accordance with your understanding of our
agreement, please so indicate by having an authorized representative sign this
Letter Agreement in the appropriate space provided below and return to us this
Letter Agreement on or prior to November 15, 1998, whereupon this Letter
Agreement and your acceptance shall represent a binding agreement between you
and the Company with respect to the matters set forth herein.
THE PEREGRINE REAL ESTATE TRUST
By: /s/ Xxxxx Xxxxx
----------------------------------------
Name: Xxxxx Xxxxx
Title: President
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IN WITNESS WHEREOF, the parties have caused this Letter Agreement to
be duly executed and delivered as of the day and year first written above.
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
By: /s/ Xxxx X. Xxxxxx
----------------------------------------
Name:
Title:
GATEWAY RECOVERY TRUST
By: The Prudential Insurance Company of
America, its Asset Manager
By: /s/ Xxxx X. Xxxxxx
-----------------------------------
Name:
Title
TCW SPECIAL CREDITS FUND IV
By: TCW Special Credits,
Its: General Partner
By: TCW Asset Management Company,
Its: Managing General Partner
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
Title: Authorized Signatory
By: /s/ Xxxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxx
Title: Authorized Signatory
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TCW SPECIAL CREDITS PLUS FUND
By: TCW Special Credits,
Its: General Partner
By: TCW Asset Management Company,
Its: Managing General Partner
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
Title: Authorized Signatory
By: /s/ XXXXX X. XXXXX
Name: Xxxxx X. Xxxxx
Title: Authorized Signatory
TCW SPECIAL CREDITS TRUST IV
By: Trust Company of the West, Trustee
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
Title: Authorized Signatory
By: /s/ Xxxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxx
Title: Authorized Signatory
TCW SPECIAL CREDITS TRUST IVA
By: Trust Company of the West, Trustee
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
Title: Authorized Signatory
By: /s/ Xxxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxx
Title: Authorized Signatory
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OCM REAL ESTATE OPPORTUNITIES FUND A, L.P.
By: Oaktree Capital Management, LLC
Its: General Partner
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
Title: President
By: /s/ Xxxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxx
Title: Principal
OCM REAL ESTATE OPPORTUNITIES FUND B, L.P.
By: Oaktree Capital Management, LLC
Its: General Partner
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
Title: President
By: /s/ Xxxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxx
Title: Principal
WEYERHAEUSER REAL ESTATE OPPORTUNITIES
SEPARATE ACCOUNT
By: Oaktree Capital Management, LLC
Its: Investment Manager
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
Title: President
By: /s/ Xxxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxx
Title: Principal
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WEYERHAEUSER COMPANY MASTER RETIREMENT
TRUST
By: TCW Special Credits,
Its: Investment Manager
By: TCW Asset Management Company
Its: Managing General Partner
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
Title: Authorized Signatory
By: /s/ Xxxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxx
Title: Authorized Signatory
-15-
SCHEDULE 2.5
CONSENTS
1. Prior written consent and waiver from Fleet Capital Corporation pursuant to
Section 10.1.12 of the Loan and Security Agreement, dated as of December 4,
1997, between the Peregrine Real Estate Trust and Fleet Capital
Corporation.
2. Prior written consent and waiver from Holiday Inns Franchising, Inc. and
Holiday Hospitality Franchising, Inc. relating to the Holiday
Inn-Registered Trademark- Change of Ownership License Agreement dated
July 20, 1993 relating to location number 1608, the Holiday Inn-Registered
Trademark- Hotel License Renewal Agreement dated January 23, 1998 relating
to location number 4203 and the Holiday Inn-Registered Trademark- Hotel
License Renewal Agreement dated December 18, 1997 relating to location
number 5053.
3. Prior written consent and waiver from the Noteholders and The Prudential
Insurance Company of America as Agent for Noteholders relating to the
Second Amended and Restated Note Agreement.
SCHEDULE 3.2
BENEFICIAL OWNER NOMINEE NAME PREFERRED
---------------- ------------ ---------
SHARES
------
GATEWAY RECOVERY TRUST GATEWAY RECOVERY TRUST 3,102,816
THE PRUDENTIAL INSURANCE THE PRUDENTIAL INSURANCE 1,361,667
COMPANY OF AMERICA COMPANY OF AMERICA
WEYERHAEUSER COMPANY MASTER XXXXXXX & CO. 644,894
RETIREMENT TRUST
TCW SPECIAL CREDITS FUND IV XXXXXXX & CO. 2,077,992
TCW SPECIAL CREDITS PLUS FUND XXXXXXX & CO. 2,221,304
TCW SPECIAL CREDITS TRUST IV XXXXXXX & CO. 1,791,375
TCW SPECIAL CREDITS TRUST XXX XXXXXXX & CO. 429,931
WEYERHAEUSER REAL ESTATE HARE & CO. 513,416
OPPORTUNITIES
OCM REAL ESTATE OPPORTUNITIES HARE & CO. 1,694,273
FUND A, L.P.
OCM REAL ESTATE OPPORTUNITIES HARE & CO. 2,926,467
FUND B, L.P.
TOTAL PREFERRED SHARES: 16,764,135
SCHEDULE 3.4
CONSENTS
NONE
