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EXHIBIT 10.18
FOURTH AMENDMENT TO THE SECOND AMENDED AND RESTATED NOTE AGREEMENT DATED JUNE
30, 1998, BY AND AMONG THE PEREGRINE REAL ESTATE TRUST, THE NOTEHOLDERS NAMED
THEREIN, AND THE PRUDENTIAL INSURANCE COMPANY OF AMERICA AS AGENT FOR THE
NOTEHOLDERS
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FOURTH AMENDMENT TO SECOND AMENDED AND RESTATED
NOTE AGREEMENT AND CONSENT AND WAIVER
THIS FOURTH AMENDMENT TO SECOND AMENDED AND RESTATED NOTE AGREEMENT
AND CONSENT AND WAIVER (this "Amendment"), dated as of June 30, 1998, is made by
and among The Peregrine Real Estate Trust, formerly known as Commonwealth Equity
Trust (the "Company"); each of the noteholders party to the Senior Credit
Agreement (as defined below) (individually, a "Noteholder" and, collectively,
the "Noteholders"); and The Prudential Insurance Company of America, as Agent
for the Noteholders (in such capacity, together with its successors in such
capacity, the "Agent").
R E C I T A L S
WHEREAS, the Company, the Agent and the Noteholders are parties to
the Second Amended and Restated Note Agreement dated as of September 27, 1994
(as amended, the "Senior Credit Agreement");
WHEREAS, the Company and Fleet Capital Corporation ("Fleet") are
parties to the Loan and Security Agreement dated as of December 4, 1997 which
constitutes the current "New Credit Line" under the Senior Credit Agreement;
WHEREAS, the Company wishes to amend the New Credit Line to increase
the commitment thereunder from $20,000,000 to $27,500,000;
WHEREAS, the Company wishes to use proceeds of the New Credit Line
to purchase the hotel property described in Exhibit A attached hereto (the
"Acquired Property") and xxxxx x xxxx on the Acquired Property to Fleet to
secure the New Credit Line;
WHEREAS, Section 2.10 of the Senior Credit Agreement prohibits the
Company from using proceeds from the New Credit Line to purchase real property
and Section 1.3 of the Senior Credit Agreement precludes property purchased with
proceeds of the New Credit Line from constituting After Acquired Property;
WHEREAS, the Company has requested that the Agent and the
Noteholders (i) consent to the increase in the New Credit Line, the use of
proceeds of the New Credit Line to purchase the Acquired Property and the
granting of a lien on the Acquired Property to Fleet, (ii) waive the application
of Section 2.10 and Section 1.3 of the Senior Credit Agreement to allow the
Company's use of proceeds of the New Credit Line to purchase the Acquired
Property, the granting of a lien on the Acquired Property to Fleet and the
characterization of the Acquired Property as After Acquired Property and (iii)
amend the Senior Credit Agreement to reflect the foregoing; and
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WHEREAS, the Agent and the Noteholders are willing to grant such
consent and agree to such waivers and amendments on the terms and conditions set
forth herein.
NOW, THEREFOR, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company, the Agent and the
Noteholders agree as follows:
1. Defined Terms. Capitalized terms used but not defined in this
Amendment shall have the meanings assigned to such terms in the Senior Credit
Agreement.
2. Amendment to Senior Credit Agreement. Section 1.60 of the
Senior Credit Agreement is hereby amended to read in its entirety as follows:
1.60 "New Credit Line" means the line of credit provided to
the Company pursuant to the Loan and Security Agreement dated as of
December 4, 1997 between the Company and Fleet Financial Corporation, as
the same may be amended, modified, renewed, refunded, replaced or
refinanced from time to time, in whole or in part; provided, that the
principal amount outstanding thereunder does not exceed $27,500,000.
3. Consent and Agreement. The Agent and the Noteholders hereby
consent to (i) the amendment to the New Credit Line increasing the amount of the
New Credit Line to $27,500,000, (ii) the Company's purchase of the Acquired
Property, (iii) the Company's granting of a lien on the Acquired Property to
Fleet and (iv) the Company's use of up to $9,250,000 of the proceeds of the New
Credit Line to purchase the Acquired Property. In addition, the Agent and the
Noteholders hereby agree that the Acquired Property shall constitute After
Acquired Property; provided that, subject to the prior consent of Fleet or such
other provider of the New Credit Line, in the event the Acquired Property ceases
to secure the New Credit Line or any refinancing of any portion of the New
Credit Line or the refinancing of the Acquired Property, the Company, upon the
written request of Agent, shall xxxxx x xxxx on the Acquired Property to the
Agent for the benefit of the Agent and the Noteholders.
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4. Waiver. The Agent and the Noteholders hereby waive the
application of the provisions of Section 2.10 of the Senior Credit Agreement to
the extent such section would preclude the Company from using proceeds of the
New Credit Line to consummate the purchase of the Acquired Property; provided
that such waiver shall apply solely with respect to the use of up to $9,250,000
of proceeds of the New Credit Line. In addition, the Agent and the Noteholders
hereby waive the provisions of Section 1.3 to the extent such section precludes
the Acquired Property from constituting After Acquired Property as result of the
Acquired Property being purchased with proceeds of the New Credit Line.
5. Representations and Warranties. The Company represents and
warrants to the Agent and the Noteholders that (a) the execution, delivery and
performance of this Amendment have been duly authorized by all necessary
corporate action on behalf of the Company, (b) this Amendment constitutes the
legal, valid and binding obligation of the Company and (c) prior to and after
giving effect to this Amendment, no Default or Event of Default has or shall
have occurred and be continuing.
6. Effect of Amendment. The consent and agreement set forth in
Section 3 of this Amendment and the waiver set forth in Section 4 of this
Amendment are limited in effect, shall apply only as expressly set forth in this
Amendment and shall not constitute a waiver of any other provision of the Senior
Credit Agreement. The Senior Credit Agreement is modified only by the express
provisions of this Amendment, and shall otherwise remain in full force and
effect and is hereby ratified and confirmed by the Company in all respects.
7. Entire Agreement. This Amendment constitutes the complete
agreement of the parties with respect to the subject matters referred to in this
Amendment and supersedes all prior or contemporaneous negotiations, promises,
covenants, agreements or representations of every nature whatsoever with respect
to such subject matters, all of which become merged and finally integrated into
this Amendment.
8. Additional Assurances. The parties agree that they shall take
such actions and execute and deliver such documents as are reasonably required
to effectuate the purposes of this Amendment, including, without limitation, the
execution and delivery by the Agent on behalf of itself and the Noteholders of a
subordination agreement in favor of Fleet with respect to the Acquired Property
and amendments to the existing subordination agreements between the Agent and
Fleet to increase the amount set forth therein from $20,000,000 to $27,500,000.
9. Successors and Assigns. This Amendment shall be binding upon
and inure to the benefit of the parties to this Amendment and their respective
successors and permitted assigns.
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10. GOVERNING LAW; SUBMISSION TO JURISDICTION. THIS AMENDMENT
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
CALIFORNIA. EACH OF THE PARTIES TO THIS AMENDMENT HEREBY SUBMITS TO THE
NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE CENTRAL
DISTRICT OF CALIFORNIA AND OF ANY CALIFORNIA STATE COURT SITTING IN LOS ANGELES,
CALIFORNIA, FOR THE PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING
TO THIS AMENDMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AMENDMENT. EACH OF
THE PARTIES TO THIS AMENDMENT IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO
THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY
CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
11. WAIVER OF JURY TRIAL. EACH OF THE PARTIES TO THIS AMENDMENT
HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY AND ALL
RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS AMENDMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
12. Counterparts. This Amendment may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties to this Amendment may execute this Amendment
by signing any such counterpart.
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IN WITNESS WHEREOF, the parties have caused this Amendment to be duly executed
and delivered as of the day and year first above written.
COMPANY
THE PEREGRINE REAL ESTATE TRUST,
(fka Commonwealth Equity Trust)
By: ______________________________________
Name:
Title:
AGENT
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA, as Agent
By: ______________________________________
Name:
Title:
NOTEHOLDERS
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By: ______________________________________
Name:
Title:
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GATEWAY RECOVERY TRUST
By: The Prudential Insurance Company of
America, Asset Manager
By: ______________________________________
Name:
Title:
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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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:
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:
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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:
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WEYERHAEUSER REAL ESTATE OPPORTUNITIES
SEPARATE ACCOUNT
By: Oaktree Capital Management, LLC,
Its Investment Manager
By: ______________________________________
Name:
Title:
By: ______________________________________
Name:
Title:
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EXHIBIT A
DESCRIPTION OF ACQUIRED PROPERTY
Real Property in the City of Concord, County of Contra Costa, State of
California, described as follows:
Parcel 2, as shown on the Parcel Map filed June 27, 1967, Book 1 of Parcel Maps,
Page 15, Contra Costa County Records.
A.P. No.: 000-000-000
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