EXHIBIT 10.20
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
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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:
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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 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
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qualification with, any governmental authority on the part of the Company as a
condition to the execution, delivery or performance of this Letter Agreement.
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).
2.8 SHAREHOLDER LIABILITY. 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.
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
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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.
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
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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 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");
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(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;
(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
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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
(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 Xxxx Xxxxxx, Xxxxx 0000
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:
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Oaktree Capital Management, LLC
000 Xxxxx Xxxx Xxxxxx, Xxxxx 0000
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.
(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.
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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.
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 ________, 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.
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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 October ___, 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:
---------------------------------
Name:
Title:
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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:
------------------------------------
Name:
Title:
GATEWAY RECOVERY TRUST
By: The Prudential Insurance Company of
America, its Asset Manager
By:
--------------------------------
Name:
Title:
TCW SPECIAL CREDITS FUND IV
By: TCW Special Credits,
Its: General Partner
By: TCW Asset Management Company,
Its: Managing General Partner
By:
-------------------------------
Name:
Title:
By:
-------------------------------
Name:
Title:
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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:
-------------------------------
Name:
Title:
By:
-------------------------------
Name:
Title:
TCW SPECIAL CREDITS TRUST IV
By: Trust Company of the West, Trustee
By:
-------------------------------
Name:
Title:
By:
-------------------------------
Name:
Title:
TCW SPECIAL CREDITS TRUST IVA
By: Trust Company of the West, Trustee
By:
-------------------------------
Name:
Title:
By:
-------------------------------
Name:
Title:
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OCM REAL ESTATE OPPORTUNITIES FUND A, L.P.
By: Oaktree Capital Management, LLC
Its: General Partner
By:
------------------------------
Name:
Title:
By:
------------------------------
Name:
Title:
OCM REAL ESTATE OPPORTUNITIES FUND B, L.P.
By: Oaktree Capital Management, LLC
Its: General Partner
By:
------------------------------
Name:
Title:
By:
------------------------------
Name:
Title:
WEYERHAEUSER REAL ESTATE OPPORTUNITIES
SEPARATE ACCOUNT
By: Oaktree Capital Management, LLC
Its: Investment Manager
By:
------------------------------
Name:
Title:
By:
------------------------------
Name:
Title:
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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:
------------------------------
Name:
Title:
By:
------------------------------
Name:
Title:
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