Deere Park Equities, L.L.C.
000 Xxxxxx Xxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
Re: DOMINION BRIDGE CORPORATION
Gentlemen:
The undersigned understand that Deere Park Equities, L.L.C., an Illinois limited
liability company ("Deere Park"), intends to lend funds this date (the "Loan")
to Dominion Park, L.L.C., a newly formed Delaware limited liability company
("Dominion Park"), pursuant to that certain letter agreement dated August 19,
1997, as amended, among Deere Park and the undersigned (the "Letter Agreement").
In order to induce Deere Park to make the Loan, the undersigned represent,
warrant and covenant to Deere Park as follows:
1. DEFINITIONS. All capitalized terms used and not otherwise defined in this
letter have the meanings ascribed to them in the Letter Agreement. It is
understood that Dominion Park is the entity described as "Newco" in the
Letter Agreement.
2. ACKNOWLEDGMENT OF ADVANCE FUNDING. The undersigned acknowledge that Deere
Park has previously funded $2,500,000 of the Loan ($1,000,000 on August 22,
1997 and $1,500,000 on August 28, 1997), which the Management Stockholders
have applied as partial payment for the Management Option Shares. The
remaining balance of the Loan to be funded is therefore $2,260,000.
3. EXERCISE OF OPTIONS. The Management Stockholders have exercised their
respective Management Options in accordance with all applicable
requirements of the DBC's stock option plan and all conditions to the
issuance of the Management Option Shares have been satisfied, subject only
to receipt by Xxxxxxx Xxxxx, on behalf of DBC, of the remaining balance of
the Loan in payment of the exercise therefor.
4. TRANSFER OF MANAGEMENT OPTION SHARES TO WELLGATE. The Management
Stockholders have irrevocably transferred their respective Management
Option Shares, upon issuance, to Wellgate International Ltd., a British
Virgin Islands corporation ("Wellgate"). Wellgate has irrevocably
instructed Xxxxxxx Xxxxx to transfer the Management Option Shares to Deere
Park, for the account of Dominion Park, upon receipt of the remaining
balance of the Loan proceeds. A copy of Xxxxxxxx's letter of direction is
attached to this letter as Exhibit A.
5. TRANSFER OF COLLATERAL SHARES. Prior to funding of the remaining balance
of the Loan, the undersigned will take all steps necessary to (a) cause the
transfer to Wellgate of 500,000 additional shares of DBC Common Stock
standing in their respective names (the "Collateral Shares") and (b) direct
Wellgate to cause Xxxxxxx Xxxxx to transfer the Collateral Shares to Deere
Park, for the account of Dominion Park, as collateral security for the
Guaranty. A copy of Xxxxxxxx's letter of direction to Xxxxxxx Xxxxx to so
transfer the Collateral Shares is attached to this letter as Exhibit B.
6. REPRESENTATIONS REGARDING SHARES. The Collateral Shares are, and the
Management Option Shares upon payment of the remaining exercise price
therefor will be, validly issued, fully paid and nonassessable shares of
DBC Common Stock. Subject to payment of the remaining purchase price
therefor, Wellgate will have, and upon transfer of the Management Option
Shares to Dominion Park, Dominion Park will have, good and marketable
title to the Management Option Shares, free and clear of any liens, claims
or encumbrances whatsoever, other than those created by the Security
Agreement. The undersigned have, and upon transfer of the Collateral
Shares to Wellgate, Wellgate will have, good and marketable title to the
Collateral Shares, free and clear of any liens, claims or encumbrances
whatsoever, other than the pledge of the Collateral Shares to Dominion Park
to secure the Guaranty.
7. AUTHORITY OF MANAGEMENT STOCKHOLDERS AND WELLGATE. The Management
Stockholders and Wellgate have full power and authority to enter into the
transactions contemplated by the Letter Agreement and to execute and
deliver, and perform their respective obligations under, all documents and
agreements contemplated thereby. The undersigned are the sole directors
and executive officers of Wellgate and undertake, prior to or promptly
following the funding of the Loan, to deliver to Deere Park certified
resolutions evidencing the incumbency and authority of the undersigned and
certified resolutions authorizing the participation by Xxxxxxxx in all
transactions contemplated by the Letter Agreement.
8. REPRESENTATION ON DBC BOARD. Xxxxx Xxxxxxx and Xxxxx Xxxxxx have been
approved by the Selection Committee of DBC's Board of Directors, and
immediately upon funding of the Loan, the undersigned will call a special
meeting of the Board of Directors to approve the appointment of Messrs.
Xxxxxxx and Xxxxxx as additional directors of DBC.
9. FORM S-3/S-8 REGISTRATION STATEMENT. Promptly following the funding of the
Loan, the undersigned will use their best efforts to cause DBC to file a
Form S-3/S-8 Registration Statement covering the resale of all Management
Option Shares not covered in DBC's previously-filed Form S-3/S-8
Registration Statement The new Form S-3/S-8 Registration Statement shall
be in substantially in the form of the draft previously furnished to Deere
Park's counsel but with such changes as may be required to reflect the
transfer of the Management Shares to Dominion Park. At all times
thereafter during the term of Dominion Park, the undersigned shall also use
their best efforts to cause DBC to take such further action, if any, as may
be required under applicable federal and state securities laws to permit
the resale of the Management Option Shares by Dominion Park.
10. DEFAULT UNDER THE NOTE. The undersigned acknowledge and agree that the
breach by the undersigned of any of their representations, warranties or
covenants contained in this letter shall be an event of default under the
Note, entitling Dominion Park to call the Note and exercise all of its
remedies with respect thereto.
Very truly yours,
/s/ XXXXXX X. XXXXXXXXX /s/ XXXXXXXX X. XXXXXXXXX
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