UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
PRESIDIO CAPITAL CORP.
(Name of Issuer)
Class A Common Shares, U.S. $.01 par value
(Title of Class of Securities)
G72201109
(CUSIP Number)
Richard J. Sabella, Esq., Cahill Gordon & Reindel,
80 Pine Street, New York, New York 10005, (212) 701-3000
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(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
July 18, 1997
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box |_|.
Check the following box if a fee is being paid with the statement | |. (A fee is
not required only if the reporting person: (1) has a previous statement on file
reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Page 1 of 6 Pages
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SCHEDULE 13D
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CUSIP No. Page 2 of 6 Pages
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Presidio Holding Company LLC - EIN 13-3958513
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |X|
(b) |_|
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
00 - Equity Contribution
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) |_|
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
The Reporting Person is organized under the laws of New York
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7 SOLE VOTING POWER
NUMBER OF 5,555,586
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH
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8 SHARED VOTING POWER
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9 SOLE DISPOSITIVE POWER
5,555,586
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10 SHARED DISPOSITIVE POWER
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
5,555,586
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
approximately 63.1%
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14 TYPE OF REPORTING PERSON
00 - Limited Liability Company
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Page 2 of 6 Pages
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Item 1. Security and Issuer.
This statement relates to the Class A Common Shares, U.S. $.01 par
value (the "Class A Shares"), of Presidio Capital Corp. (the "Issuer"), an
entity incorporated under the laws of the jurisdiction of the British Virgin
Islands, whose principal executive offices are located at c/o Hemisphere
Management (Cayman) Limited, Zephyr House, Mary Street, Grand Cayman, Cayman
Islands, British West Indies.
Item 2. Identity and Background
This statement is filed by Presidio Holding Company, LLC ("PHC"), a New
York limited liability company. The address for PHC is 299 Park Avenue, 33rd
Floor, New York, N.Y. 10171. PHC is a newly formed entity created to hold the
shares of the Issuer. Northstar Operating, LLC ("Northstar") is the single
member of PHC. Northstar is a Delaware limited liability company whose address
is 299 Park Avenue, 33rd Floor, New York, N.Y. 10171. Northstar is a newly
formed entity created to hold interests in PHC. Northstar has 2 members,
Northstar Capital Partners ("NCP"), which holds a 99% interest, and Northstar
Capital Holdings I, LLC ("NCHI"), which holds a 1% interest. Both NCP and NCHI
are Delaware limited liability companies whose business address is 299 Park
Avenue, 33rd Floor, New York, N.Y. 10171. Each of NCP and NCHI was formed for
the purpose of holding the interest in Northstar. NCP has two members, NCHI,
which holds a 74.75% interest, and Northstar Capital Holdings II, LLC ("NCHII"),
which holds a 25.25% interest. The business address for NCHII is 299 Park
Avenue, 33rd Floor, New York, N.Y. 10171. NCHII, a Delaware limited liability
company, was formed for the purpose of holding its interest in NCP. NCHII has
three members, NCHI, which holds a 99% interest, Edward Scheetz, who holds 0.5%
interest, and David Hamamoto, who holds 0.5% interest. Mr. Scheetz, a U.S.
citizen whose business address is 299 Park Avenue, 33rd Floor, New York, N.Y.
10171, is a founding member of NCP. Mr. Hamamoto, a U.S. citizen whose business
address is 299 Park Avenue, 33rd Floor, New York, N.Y. 10171, is a founding
member of NCP. NCHI has two members, Mr. Scheetz and Mr. Hamamoto, each of whom
holds a 50% interest.
During the five years prior to the date hereof, neither PHC nor to
PHC's knowledge any member of PHC has (i) been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors) during the
last five years nor has been (ii) a party to any civil proceeding of a judicial
or administrative body of competent jurisdiction and as a result of such
proceeding was or is subject to a judgment, decree, or final order enjoining
future violations of, or prohibiting or mandating activities subject to, federal
or state securities law or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration
The Class A Shares were purchased for $25 per share in cash. In
addition, pursuant to the Stock Purchase Agreement (the "Stock Purchase
Agreement") dated as of July 18, 1997 by and among PHC and Farallon Capital
Partners, L.P., Farallon Capital Institutional Partners, L.P., Farallon Capital
Institutional Partners II, L.P., Tinicum Partners, L.P., Farallon Capital
Offshore Investors, Inc., The Common Fund and Consolidated Press International
Ltd. (collectively, the "Farallon Sellers"), PHC has agreed to pay the Farallon
Sellers an additional amount ("Deferred Purchase Price"). The Deferred Purchase
Price is that portion of the Net Proceeds (as defined in the Stock Purchase
Agreement) received by PHC in respect of the Class A Shares purchased from the
Farallon Sellers which is payable to the Farallon Sellers pursuant to the Stock
Purchase Agreement. Such Net Proceeds are applied (i) first, to PHC until its
annualized internal rate of return ("AIRR" as defined in the Stock Purchase
Agreement) equals 12.5%, (ii) next, 70%
Page 3 of 6 Pages
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to PHC and 30% to the Farallon Sellers until PHC has received an AIRR equal to
16.5% and (iii) next, the balance, if any, 82% to PHC and 18% to the Farallon
Sellers. Pursuant to the Stock Purchase Agreement, at any time prior to July 18,
1998 PHC may at its option terminate its obligation to pay the Deferred Purchase
Price in respect of 75% of the Class A Shares acquired from the Farallon Sellers
by paying the Farallon Sellers $3.00 per share and in respect of the remaining
25% by paying $4.00 per share. In addition, at any time after July 18, 2002 the
Farallon Sellers may at their option require PHC to purchase for fair market
value the right of the Farallon Sellers to receive the Deferred Purchase Price.
The source of funds used to pay for the Class A Shares was a
capital contribution received from the members of Northstar. Northstar
received such funds from long-term loans from a commercial lender on terms
that include an equity participation factor and which require repayment out
of Net Available Cash.
The Stock Purchase Agreement is attached hereto as Exhibit 1 and is
hereby incorporated by reference herein.
Item 4. Purpose of Transaction
PHC has acquired the Class A Shares to obtain a substantial equity
position in the Issuer for investment. As a holder of more than 58% of the Class
A Shares, PHC is a Control Party as defined in the Issuer's Articles of
Association and intends to exercise its rights to take control of the Board of
Directors of the Issuer and to insure that the Issuer is operated in a manner
that is most beneficial to all of its members. Such action will include a
careful review of existing arrangements under the Issuer's management
agreements.
PHC may, as the opportunity arises, purchase additional Class A Shares
or other securities of the Issuer, including possibly Class B Shares. PHC has
had conversations with other holders of the Issuer's Class A Shares and with
holders of the Issuer's Class B Shares concerning the possibility of PHC
acquiring additional shares of the Issuer. As of the date hereof, PHC has not
reached any agreements with any such holders.
As a holder of greater than 58% of the Class A Shares, PHC has, in
accordance with Articles 73 and 77 of the Articles of Association of the Issuer,
taken action by written resolution to remove the existing Class A directors and
to elect Edward Scheetz, David Hamamoto and David King to serve as Class A
directors effective on September 2, 1997.
On July 25, 1997, the Issuer received a copy of the written resolution.
In connection with this action by written resolution of the Issuer's members,
PHC believes that the Issuer is required to file and distribute to its record
holders, 20 days prior to the effective date of such action, an Information
Statement pursuant to Section 14(c) under the Securities Exchange Act of 1934
and Rule 14c-2 promulgated thereunder.
Pursuant to Article 79A of the Issuer's Articles of Association, since
at least 15% of all shares of the Issuer are beneficially owned by persons who
are not Control Parties as defined in the Articles of Association, such members
may elect at least two directors who shall be subject to removal only by a
majority vote of such members. If a Class A director is removed by the requisite
vote of members including a Control Party, as in the present circumstances, the
number of directors shall be increased by a number sufficient to permit PHC to
elect a majority of the directors. PHC stands ready to take whatever action is
required to comply with the Issuer's Articles of Association, including
increasing the number of Class A directors and electing additional persons to
serve as Class A directors.
It is contemplated that an affiliate of PHC may acquire interests in
the general partners of certain limited partnerships that are obligors under
mortgages in which the Issuer has an interest.
Other than as described above, as of the date hereof, none of PHC or
its members or control persons has made any proposals to the Issuer which would
result in (i) acquisition by any person of additional securities of the Issuer,
or the disposition of securities of the Issuer except for open market or
privately negotiated purchases or sales of the Issuer's securities at times and
prices determined by the investment objectives of the Reporting Person; (ii) any
extraordinary corporate transaction, such as a merger, reorganization or
liquidation, involving the Issuer or any of its subsidiaries; (iii) any sale or
transfer of a material amount of assets of the Issuer or any of its
subsidiaries; (iv) any change in the present Board of Directors or managers of
the Issuer; (v) any material change in the present capitalization or dividend
Page 4 of 6 Pages
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policy of the Issuer; (vi) any other material change in the Issuer's business or
corporate structure; (vii) any change in the Issuer's charter, by-laws or
instruments corresponding thereto or other actions which may impede the
acquisition of control of the Issuer by any person; (viii) causing a class of
securities of the Issuer to be delisted from a national securities exchange;
(ix) causing a class of securities of the Issuer to become eligible for
termination of registration pursuant to Section 12(g)(4) of the Securities
Exchange Act of 1934; or (x) any action similar to any of those enumerated
above.
PHC intends to review its investment in the Issuer after the date
hereof, and from time to time, in light of the Issuer's operations, prospects,
business development and competitive and strategic matters. After such review,
PHC may change its intention with respect to proposing one or more actions to
enhance shareholder value or to effect a change of control of the Issuer,
including one or more of the matters described in clauses (i) through (x) above.
Item 5. Interest in Securities of the Issuer.
(a) 5,555,586 Class A Shares; approximately 63.1%
interest in Issuer;
(b) sole power to vote - 5,555,586 Class A Shares; sole power to
dispose 5,555,586 Class A Shares
(c) On July 18, 1997, pursuant to the Stock Purchase Agreement, PHC
acquired from the Farallon Sellers an aggregate of 4,553,380 Class A Shares for
an aggregate cash purchase price of $113,834,500. On July 22, 1997, PHC acquired
1,002,206 Class A Shares from Fernwood Associates, L.P., Fernwood Restructurings
Ltd., Fernwood Foundation, L.P. and Fernwood Total Return Holdings Ltd. for an
aggregate cash purchase price of $25,055,150. These purchases were privately
negotiated transactions. In addition, PHC has entered into the Stock Purchase
Agreement pursuant to which it has also agreed to pay the Farallon Sellers the
Deferred Purchase Price, as described in Item 3 above.
Item 6. Contracts, Arrangements, Understandings or
Relationships with Respect to Securities of the Issuer.
Other than the Stock Purchase Agreement attached hereto as Exhibit 1,
there are no contracts, arrangements, understandings or relationships with
respect to securities of the Issuer.
Item 7. Items to be Filed as Exhibits.
Exhibit 1 Stock Purchase Agreement dated as of July 18, 1997 by and
among Farallon Capital Partners, L.P., Farallon Capital
Institutional Partners, L.P. Farallon Capital Institutional
Partners II, L.P., Tinicum Partners, L.P., Farallon Capital
Offshore Investors, Inc., The Common Fund and Consolidated
Press International Ltd., as Sellers, and Presidio Holding
Company, LLC, as Purchaser.
Page 5 of 6 Pages
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Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
July 28, 1997
PRESIDIO HOLDING COMPANY, LLC
By: /s/ David King
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Page 6 of 6 Pages
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STOCK PURCHASE AGREEMENT
By and Among
FARALLON CAPITAL PARTNERS, L.P.,
FARALLON CAPITAL INSTITUTIONAL PARTNERS, L.P.,
FARALLON CAPITAL INSTITUTIONAL
PARTNERS II, L.P., TINICUM PARTNERS, L.P.,
FARALLON CAPITAL OFFSHORE INVESTORS, INC.,
THE COMMON FUND and
CONSOLIDATED PRESS INTERNATIONAL LTD.,
as Sellers,
and
PRESIDIO HOLDING COMPANY, LLC,
as Purchaser.
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Dated as of July 18, 1997
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STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT, dated as of July 18, 1997, by and among FARALLON
CAPITAL PARTNERS, L.P., FARALLON CAPITAL INSTITUTIONAL PARTNERS, L.P., FARALLON
CAPITAL INSTITUTIONAL PARTNERS II, L.P., TINICUM PARTNERS, L.P., FARALLON
CAPITAL OFFSHORE INVESTORS, INC., THE COMMON FUND and CONSOLIDATED PRESS
INTERNATIONAL LTD. (each, a "Seller"), as sellers, and PRESIDIO HOLDING COMPANY,
LLC, a New York limited liability company ("Purchaser"), as purchaser.
R E C I T A L S :
A. Each Seller is the owner of the number of Presidio Shares (as
hereinafter defined) indicated on Schedule A annexed hereto.
B. On the terms and subject to the conditions hereinafter set forth, each
Seller desires to sell to Purchaser, and Purchaser desires to purchase from such
Seller, the Presidio Shares owned by such Seller.
A G R E E M E N T :
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Definitions. As used in this Agreement, unless the context
requires a different meaning, the following terms have the meanings indicated:
"Affiliate" means, with respect to any Person, either (i) any Subsidiary of
such Person, or (ii) any other Person that, directly or indirectly, controls, is
controlled by or is under common control with such Person. For the purposes of
this definition, "control" (including, with correlative meanings, the terms
"controlled by" and "under common control with") shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of the
management
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and policies of such Person, whether through the ownership of voting
securities or by contract or otherwise.
"Affiliated Transaction" means any transaction (including without
limitation any sale, transfer, lease, assignment, investment or contract or
arrangement of any kind) between or among, directly or indirectly, Purchaser,
any of its Affiliates and/or any of its Subsidiaries other than (i) the Company
or any of its Subsidiaries or (ii) any Related Company or any of its
Subsidiaries.
"Agreement" means this Stock Purchase Agreement, as amended from time to
time in accordance with the terms hereof.
"AIRR" means, at any date and in respect of each Presidio Share acquired by
Purchaser under this Agreement, the then internal rate of return (expressed as
an annualized percentage) on Purchaser's Investment Basis in such Presidio Share
for the period commencing on the Closing Date and ending on the date of
determination thereof, calculated on a semi-annual compounding basis, based on a
year consisting of 12 months and 365 days; provided, however, that calculations
in respect of periods less than a month will be based on the actual number of
days elapsed over a presumed monthly period of 30 days. It is understood that
the AIRR in respect of any Presidio Share shall not be a positive percentage
unless and until Purchaser has received Net Proceeds attributable thereto that
exceed the amount of Purchaser's Investment Basis thereon.
"Business Day" means any day except Saturday, Sunday and any day that is a
legal holiday or on which banking institutions in the State of New York are
authorized or required by law or other government action to close.
"Cash Distribution" means (i) any cash dividend or distribution on account
of any equity securities or any interest, principal or other payment in cash on
account of any debt instrument, (ii) any other payment of money received (a)
pursuant to the terms of any contract, lease or other instrument constituting
Non-Cash Proceeds or (b) otherwise in respect of any Non-cash Proceeds, (iii)
any redemption, retirement, sinking fund or similar payment of money for or in
respect of the acquisition of any securities, (iv) any cash payment made to
purchase, redeem, retire or surrender options, warrants or other rights to
acquire equity or debt securities or (v) any other cash proceeds of any kind
received on or in respect of (a) the Presidio Shares to be acquired by Purchaser
hereunder or (b) any Non-cash Proceeds thereof.
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"Cash Purchase Price" means the portion of the Purchase Price for the
Presidio Shares to be acquired by Purchaser hereunder that, pursuant to Section
2.1 hereof, is contemplated to be paid in immediately available funds on the
Closing Date.
"Closing" has the meaning provided therefor in Section 3.1 of this
Agreement.
"Closing Date" means the date that the Closing actually occurs.
"Company" means Presidio Capital Corp., a corporation organized and
existing under the laws of the British Virgin Islands and its successors and
assigns.
"Deferred Purchase Price" means the payments, if any, from time to time
owing to the Sellers pursuant to the provisions of Section 2.2.
"Fair Value Adjustment Amount" means, in respect of each Presidio Share
acquired by Purchaser hereunder or any Non-cash Proceeds thereof, the amount of
diminution, if any, in the amounts that would otherwise be payable or realized
in respect of such Presidio Share or such Non-Cash proceeds thereof as described
in clauses (i) and (ii) of the definition of Net Proceeds, but only to the
extent that such diminution is caused by or attributable to any Interested Party
Transaction.
"Interested Party Transaction" means any transaction between the Company or
any of its Subsidiaries or any Related Company or any of its Subsidiaries and
(i) the Purchaser or any of its Affiliates (other than the Company and its
Subsidiaries and any Related Company and its Subsidiaries) or (ii) any other
Person in which the Purchaser or any of its Affiliates (other than the Company
and its Subsidiaries and any Related Company and its Subsidiaries) owns any
interest.
"Investment Basis" means, in respect of each Presidio Share acquired by
Purchaser hereunder, the Cash Purchase Price in respect thereof plus the
following out of pocket amounts: (i) the per share amount of all closing and
other reasonable expenses of Purchaser (including, without limitation, legal
fees) incurred in connection with the acquisition of such Presidio Share, (ii)
the per share amount of any capital contributions made by Purchaser to the
Company after the Closing Date in respect of such Presidio Share, (iii) the per
share amount of any post closing costs or expenses of Purchaser in connection
with or arising out of the acquisition of such Presidio
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Share hereunder (excluding (a) any financing expenses of any kind and (b) any
costs or expenses incurred in any dispute with Sellers with respect to this
Agreement unless Purchaser is the prevailing party in such dispute) and (iv) the
per share amount (as a fraction of all Presidio Shares owned by Purchaser
whether acquired hereunder or otherwise) of all expenses incurred by Purchaser
in connection with the enforcement of any claims relating to its investment in
the Company.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
encumbrance, charge or security interest of any kind in or on such asset or the
revenues or income thereon or therefrom.
"Losses" means all damages, losses, penalties, fines, settlement payments,
obligations to third parties, claims, costs or expenses actually suffered or
incurred by such Person excluding any consequential, special or punitive
damages.
"Management Agreements" means (i) the Management Agreement, dated as of
November 3, 1994, between the Company and Presidio Management Company, LLC, (ii)
the Management Agreement, dated as of November 3, 1994, between the Company and
Steinhardt Management Company, Inc. and (iii) the Administrative Services
Agreement dated as of November 3, 1994 between the Company and Concurrency
Management Corp.
"Net Proceeds" means, in respect of each Presidio Share acquired by
Purchaser hereunder or any Non-cash Proceeds thereof, the following amounts from
time to time actually received by Purchaser or its Affiliates or (in the case of
any Fair Market Adjustment Amount) deemed to be received by Purchaser or its
Affiliates from transactions other than Affiliated Transactions, in each case
net of all out of pocket transaction costs, transfer taxes and other
out-of-pocket expenses actually incurred by Purchaser and not included in the
Investment Basis of such Presidio Share and determined on a cash and not an
accrual basis: (i) all Cash Distributions attributable to such Presidio Share or
any Non-cash Proceeds thereof, (ii) all cash payments received upon any sale by
Purchaser or its Affiliates of such Presidio Share or any Non-cash Proceeds
thereof and (iii) all Fair Value Adjustment Amounts attributable to such
Presidio Share or Non-cash Proceeds thereof.
"Non-cash Proceeds" means, in respect of any Presidio Share acquired by
Purchaser hereunder, all proceeds, products, property, rights, entitlements
(including, without limitation or duplication, any interests in T-Two Holdings,
LLC, when is-
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sued, any subscription rights and all proceeds of proceeds of such Presidio
Shares) received thereon or on account of the ownership thereof (net of any
costs to obtain such property not otherwise included in the Investment Basis in
respect of any Presidio Share) other than any of the foregoing that constitutes
a Cash Distribution.
"Person" means an individual or a corporation, partnership, trust,
incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or political subdivision
thereof) or other entity of any kind.
"Presidio Shares" means shares of Class A common stock of the Company
having a par value of $.01 per share.
"Qualifying Litigation" means a lawsuit or proceeding (i) against one or
more Sellers and/or their Affiliates and Purchaser or (ii) against one or more
Sellers and/or their Affiliates alone and which, in either case, seeks to enjoin
or obtain other relief in respect of or alleges any damages resulting from the
transactions contemplated under this Agreement.
"Related Company" means any Person whose securities are issued to any party
as Non-cash Proceeds and which is or was at any time under common control with
the Company and includes, without limitation, upon the issuance of any such
securities, the so-called "T-Two Entities" contemplated to be the subject to a
rights offering pursuant to that certain Rights Offering Agreement dated March
19, 1996.
"Subsidiary" means, with respect to any Person, (i) a corporation, a
majority of whose capital stock with voting power, under ordinary circumstances,
to elect directors is at the time, directly or indirectly, owned by such Person,
by a Subsidiary of such Person or by such Person and a Subsidiary thereof or
(ii) any other Person (other than a corporation) in which such Person, a
Subsidiary thereof or such Person and a Subsidiary thereof, directly or
indirectly, at the date of determination thereof has at least a majority
ownership interest.
Section 1.2. Construction. When used herein the words "herein",
"hereunder", "hereby", "hereof" and similar words refer to this Agreement as a
whole. All references to a party's "knowledge" refer to actual knowledge and not
to any constructive or imputed knowledge.
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ARTICLE II
PURCHASE OF SHARES
Section 2.1. Purchase. On the terms and subject to the conditions herein
set forth, each Seller shall sell to Purchaser and Purchaser shall purchase from
such Seller on the Closing Date the Presidio Shares owned by such Seller (as set
forth on Schedule A annexed hereto) for a purchase price per share equal to (i)
$25 plus (ii) the Deferred Purchase Price in respect thereof.
Section 2.2. Deferred Purchase Price. In addition to the payment by
Purchaser of the Cash Purchase Price, Purchaser shall pay to Sellers the amounts
contemplated in this Section in respect of each Presidio Share acquired
hereunder. Each amount of Net Proceeds from time to time received (or deemed to
be received in the case of the Fair Market Adjustment Amount) by Purchaser or
its Affiliates and attributable to any Presidio Share acquired hereunder or any
Non-cash Proceeds thereof shall be applied as follows:
(i) first, to Purchaser until Purchaser has received an AIRR in
respect of such Presidio Share to the date of such distribution equal to
12.5%;
(ii) next, such Net Proceeds shall be divided, 70% to Purchaser and
30% to Sellers, until Purchaser has received an AIRR in respect of such
Presidio Share to the date of such distribution equal to 16.5%; and
(iii) next, the balance of such Net Proceeds, if any, shall be divided
82% to Purchaser and 18% to Sellers.
The foregoing provisions of this Section 2.2 shall not be construed to cause
Purchaser and Sellers to be regarded as partners or joint venturers or to create
any claim or interest of Sellers in the Presidio Shares sold hereunder or in any
proceeds thereof. Such provisions are intended merely to describe the amounts
and timing of payments which may hereafter be owing by Purchasers to Sellers
hereunder.
Section 2.3. Calculation of AIRR. The AIRR shall be calculated as of each
date that (i) Purchaser or its Affiliates receive any Net Proceeds or (ii) the
Investment Basis and in a Presidio Share acquired by Purchaser hereunder changes
in a material amount. Purchaser shall within 10 days after each such
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-7-
date: (i) send to Sellers a written calculation of the Investment Basis and AIRR
in respect of all the Presidio Shares acquired hereunder then held by Purchaser
or its Affiliates and the amount payable to Sellers hereunder (if any) together
with supporting information and (ii) pay to Sellers the amounts payable (if
any). If Sellers dispute any calculation by Purchaser the following provisions
shall apply:
(a) Purchaser shall pay any undisputed amount;
(b) The parties shall negotiate in good faith for 30 days to resolve
such dispute; and
(c) In the event the parties shall fail (within such 30-day period) to
resolve such dispute, the parties hereby agree that such resolution shall
be made in accordance with the provisions of Section 9.4 hereof.
Section 2.4. Mergers, Stock Splits, etc. In the event of any stock split,
merger, combination or other corporate restructuring transaction affecting the
Company, any Subsidiary or any Related Company or any Subsidiary thereof, the
parties shall negotiate in good faith with each other to amend the provisions of
this Article to preserve the essential economics of the arrangements herein set
forth as applied to the capital structure of the Company on the date hereof. In
the event the parties have not agreed to such amendment within 30 days, the
matter shall be determined pursuant to arbitration as provided in Section 9.4
hereof.
Section 2.5. Call Option. At Purchaser's option (to be exercised by
Purchaser in writing at any time within 12 months after the Closing Date),
Purchaser may, (i) in respect of 75% of the Presidio Shares acquired hereunder
or such lesser number thereof as shall be elected by Purchaser, terminate
Purchaser's obligation to pay the Deferred Purchase Price thereof upon payment
to Sellers of $3.00 per share for each such Presidio Share so elected by
Purchaser and (ii) in respect of the remaining 25% of the Presidio Shares
acquired hereunder (or such lesser number as shall be elected by Purchaser),
terminate Purchaser's obligation to pay the Deferred Purchase Price thereof upon
payment to Sellers of $4.00 per share for each such Presidio Share so elected by
Purchaser. Any amounts paid by Purchaser under this Section shall not be
included in the Investment Basis in any remaining Presidio Shares acquired
hereunder and amounts received by Purchaser under this Section shall not be
included in Net Proceeds with respect to any such remaining Presidio Shares.
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Section 2.6. Put Option. At Sellers' option, exercisable at any time after
five years from the Closing, Sellers may elect by written notice to Purchaser
(the "Put Notice") to put Seller's remaining rights to the Deferred Purchase
Price to Purchaser in which case Purchaser shall be obligated to purchase such
rights at the fair market value thereof determined as of the date of the Put
Notice, pursuant to the provisions of Section 9.3 and Schedule B annexed hereto.
Section 2.7. Affiliated Transactions and Interested Party Transactions.
Upon the occurrence of any material Affiliated Transaction or any material
Interested Party Transaction, Purchaser shall (subject to any confidentiality
undertakings) notify Sellers of the material terms of such transaction. The
provisions of this Section 2.7 shall not limit Purchaser's obligations under
Section 2.3.
ARTICLE III
CLOSING
Section 3.1. Closing. The purchase and sale of the Presidio Shares to be
acquired hereunder shall take place at a closing (the "Closing") to be held at
the offices of Cahill Gordon & Reindel, 80 Pine Street, New York, New York
10005, at 10:00 A.M. local time, on July 18, 1997. Notwithstanding any contrary
provision herein, in the event that the Closing has not actually occurred on or
prior to July 31, 1997, any party hereto may, upon written notice to the other
parties hereto, terminate this Agreement.
Section 3.2. Closing Deliveries. Delivery of the Presidio Shares to be
acquired hereunder shall be made at the Closing against payment of the Cash
Purchase Price therefor provided for in Section 2.1, by either (i) delivery to
Purchaser of a stock certificate or certificates representing all such Presidio
Shares (together with stock powers duly executed by Sellers) or (ii) the
transfer of such Presidio Shares to be accomplished by a book entry in the books
of Depositary Trust Company. Also at the Closing, Sellers shall deliver to
Purchaser an instrument in form acceptable to Purchaser in its reasonable
discretion pursuant to which (a) Sellers assign any and all claims (other than
claims which may not legally be assigned) they may have against any Person
relating to Sellers' ownership of the Presidio Shares to be acquired hereunder
and (b) agree to cooperate in all reasonable respects in connection with
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any actions or proceedings by Purchaser to enforce such claims.
Section 3.3. Payments. Payment of the Cash Purchase Price and any other
amounts owing from time to time to Sellers hereunder shall be made by wire
transfer of same day funds to the account identified on Schedule A annexed
hereto. Purchaser shall have no responsibility to allocate or distribute among
the several Sellers amounts of the Cash Purchase Price or any other amount from
time to time owing to Sellers or any of them hereunder.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.1. Representations and Warranties of Sellers. Each Seller
severally (and not jointly) represents and warrants, as of the date hereof, as
follows:
(a) Organization and Good Standing. Such Seller is an entity duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization. Such Seller is duly qualified or licensed
and in good standing as a foreign entity, and authorized to do business, in
each jurisdiction in which the ownership or leasing of its properties or
the character of its operations makes such qualification necessary, except
where failure to obtain such qualification, license, authorization or good
standing would not individually or in the aggregate reasonably be expected
to have a material adverse effect upon its ability to perform its
obligations under this Agreement (a "Material Adverse Effect"). Such Seller
has all requisite organizational power and authority to own its assets and
to carry on its respective businesses as presently conducted.
(b) Corporate Authorizations. Such Seller has all requisite power and
authority to execute, deliver and perform its obligations under this
Agreement. The execution and delivery by such Seller of this Agreement and
the consummation of the transactions contemplated hereby have been duly and
validly authorized by all necessary action of such Seller.
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(c) The Presidio Shares. Such Seller or its nominee has good and valid
title to the Presidio Shares purported to be sold by it, free and clear of
any Liens. Assuming Purchaser has the requisite power and authority to be
the lawful owner of such Presidio Shares, upon transfer of such shares as
contemplated in Section 3.2 hereof and receipt of the Cash Purchase Price
by Sellers, good and valid title to such Presidio Shares will pass to
Purchaser or its nominee, free and clear of any Liens arising from acts of
such Seller. Other than as set forth in this Agreement and the Schedules
hereto and in the Memorandum of Association and Articles of Association of
the Company and the No-Action Letter issued by the Securities and Exchange
Commission in respect of the Company and the Certificate of Farallon
Capital Management, LLC dated July 29, 1994 relating thereto, Presidio
Shares acquired hereunder are not subject to any voting trust agreement or
other contract, agreement, arrangement, commitment or understanding,
including any such agreement, arrangement, commitment or understanding
restricting or otherwise relating to the voting, dividend rights or
disposition of such Presidio Shares.
(d) Capitalization. The Presidio Shares to be acquired by Purchaser
hereunder constitute, to Seller's knowledge, not less than 51.74% of all
currently issued and outstanding Presidio Shares.
(e) Conflicting Agreements and Similar Matters. Neither the execution
and delivery of this Agreement by such Seller nor the consummation of the
transactions contemplated hereby by such Seller will (i) violate any
provision of any United States Federal, State or foreign law, statute, rule
or regulation (except that with respect to securities laws, Seller only
represents and warrants that it has not taken any action which would
require the sale hereunder to be registered under the Securities Act of
1933, as amended to date (the "Act")), or any order, judgment, injunction,
decree, determination or award of any United States Federal, State or
foreign court or governmental authority presently in effect having
applicability to such Seller except such violations as would not reasonably
be expected to have (individually or in the aggregate) a Material Adverse
Effect on such Seller, (ii) conflict with or result in a breach of or
constitute a default under the organizational documents of such Seller, or
(iii) require any consent, approval or notice under, or conflict with or
result in a breach of or con-
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stitute a default under, any note, bond, mortgage, license, indenture or
loan or credit agreement, or any other agreement or instrument, to which
such Seller is a party or by which any of its respective properties is
bound, except such conflicts or defaults as would not reasonably be
expected to have (individually or in the aggregate) a Material Adverse
Effect on such Seller.
(f) Enforceability. This Agreement constitutes a legal, valid and
binding obligation of such Seller, enforceable against such Seller in
accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, moratorium, or any other laws affecting creditors
rights generally or principles of equity.
(g) Litigation, Proceedings, etc. Seller is not aware of any action,
suit, notice of violation or proceeding pending or, to the best knowledge
of such Seller, threatened against or affecting such Seller or any of its
properties before or by any court, governmental or administrative agency or
regulatory authority (Federal, State, county, local or foreign) which
relates to or challenges the legality, validity or enforceability of this
Agreement.
(h) Securitization Transactions. Neither such Seller nor, to such
Seller's knowledge, any other holders of Presidio Shares constituting more
than 15% of all Presidio Shares has executed any writing having the legal
effect of a ratification of or consent to any of the transactions described
in the offering memorandum dated May 25, 1996 relating to securitization of
certain contract rights previously owned by the Company or waived in
writing any claim with respect thereto.
(i) Management Agreements. To the knowledge of such Seller, except for
the Management Agreements and the Sub-Management Agreement (as defined
below), there are no agreements, or understandings pursuant to which Joseph
Jacobs or Charles Davidson or any Person affiliated with either thereof has
any right to manage the Company or its affairs or receive fees or income
therefrom (other than as stockholders, directors or officers). To the
knowledge of Seller, the Management Agreements have not been amended or
extended except that, according to the Company's 10K for the calendar year
ended December 31, 1996, including the exhibits thereto (the "1996 10K"):
(i) the Management
<PAGE>
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Agreement referred to in clause (i) of the definition thereof was assigned
to Wexford Management, LLC ("Wexford") and such assignment was subsequently
revoked and a new agreement (the "Sub-Management Agreement") whereby
Presidio Management Company, LLC has retained Wexford to assist in the
performance of such duties, as manager, was entered into; and (ii) the
Management Agreement referred to in clause (iii) of the definition thereof
was assigned to Wexford under the Assignment of Administrative Services
Agreement between Concurrency Management Corp. and Wexford effective
January 1, 1996.
Section 4.2. Representations and Warranties of Purchaser. Purchaser
represents and warrants to each Seller, as of the date hereof, as follows:
(a) Investment Intent. The Presidio Shares to be acquired hereunder are
being acquired for its own account with no intention of distributing or
reselling such Presidio Shares or any part thereof or interest therein in any
transaction that would be in violation of the securities laws of the United
States of America or any State.
(b) Purchaser Status. Purchaser is an "accredited investor" as defined in
Rule 501(a) under the Act, has such knowledge, sophistication and experience in
business and financial matters so as to be capable of evaluating the merits and
risks of the prospective investment in the Presidio Shares to be acquired
hereunder, has so evaluated the merits and risks of such investment and is able
to bear the economic risk of such investment and, at the present time, is able
to afford a complete loss of such investment.
(c) Authority. The purchase of the Presidio Shares to be acquired hereunder
has been duly and properly authorized and this Agreement has been duly executed
and delivered by it and constitutes the valid and legally binding obligation of
Purchaser and the purchase of the Presidio Shares to be acquired hereunder does
not conflict with or violate its operating agreement or any law, regulation or
court order applicable to it.
(d) Purchaser's Investigation. Purchaser has made such examination, review
and investigation of facts and circumstances necessary to evaluate the purchase
of the Presidio Shares to be acquired hereunder as it has deemed necessary or
appropriate and has made its own investment determination and analysis based
upon such information as Purchaser deemed suffi-
<PAGE>
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cient to enter into this Agreement and not based on any statements or
representations by Sellers.
(e) Fees. There are no fees, commissions or compensation payable by any
Seller to any party engaged or retained by, through or on behalf of Purchaser in
connection with the transactions contemplated hereby. (f) Sophisticated Buyer.
Purchaser is a sophisticated buyer with respect to the Presidio Shares to be
acquired hereunder, has adequate information concerning the business and
financial condition of the Company and its Affiliates to make an informed
decision regarding such Presidio Shares, and, except for reliance on the
accuracy of Sellers' representations and warranties herein set forth, has
independently, without reliance upon Sellers and based on such information as it
deemed appropriate, made its own analysis and decision to enter into this
Agreement. Purchaser has not requested all information in Sellers' possession
and, without limiting Sellers' representations and warranties hereunder,
Purchaser waives any claim relating to the non-disclosure thereof.
(g) Organization and Good Standing. Purchaser is an entity duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization. Purchaser is duly qualified or licensed and in good standing as a
foreign entity, and authorized to do business, in each jurisdiction in which the
ownership or leasing of its properties or the character of its operations makes
such qualification necessary, except where failure to obtain such qualification,
license, authorization or good standing would not individually or in the
aggregate reasonably be expected to have a material adverse effect on
Purchaser's ability to perform its obligations under this Agreement. Purchaser
has all requisite limited liability company power and authority to own its
assets and to carry on its business as presently conducted.
(h) Corporate Authorizations. Purchaser has all requisite power and
authority to execute, deliver and perform its obligations under this Agreement.
The execution and delivery by Purchaser of this Agreement and the consummation
of the transactions contemplated hereby have been duly and validly authorized by
all necessary action of Purchaser.
(i) Conflicting Agreements and Similar Matters. Neither the execution and
delivery of this Agreement by Purchaser nor the consummation of the transactions
contemplated hereby by Purchaser will (i) violate any provision of any
<PAGE>
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United States Federal, State or foreign law, statute, rule or decree,
determination or award of any United States, Federal, State or foreign court or
governmental authority presently in effect having applicability to Purchaser
except such violations as would not reasonably be expected to have (individually
or in the aggregate) a material adverse effect on the ability of Purchaser to
perform its obligations under this Agreement, (ii) conflict with or result in a
breach of or constitute a default under the organizational documents of
Purchaser, (iii) require any consent, approval or notice under, or conflict with
or result in a breach of or constitute a default under, any note, bond,
mortgage, license, indenture or loan or credit agreement, or any other agreement
or instrument, to which Purchaser is a party or by which any of its properties
is bound, except such conflicts or defaults as would not reasonably be expected
to have (individually or in the aggregate) a material adverse effect on the
ability of Purchaser to perform its obligations under this Agreement, or (iv)
result in or require the creation or imposition of any Lien upon or with respect
to any of the properties now owned or hereafter acquired by Purchaser.
(j) Enforceability. This Agreement constitutes a legal, valid and binding
obligation of Purchaser, enforceable against Purchaser in accordance with its
terms, except as such enforceability may be limited by bankruptcy, insolvency,
moratorium, or any other laws affecting creditors rights generally or principles
of equity.
(k) Litigation, Proceedings, etc. Purchaser is not aware of any action,
suit, notice of violation or proceeding pending or, to the knowledge of
Purchaser, threatened against or affecting Purchaser or any of its properties
before or by any court, governmental or administrative agency or regulatory
authority (Federal, State, county, local or foreign) which relates to or
challenges the legality, validity or enforceability of this Agreement.
(l) Transfer. Purchaser understands that the Presidio Shares to be acquired
hereunder are being transferred pursuant to an exemption from registration under
the Act and that any subsequent sale, assignment or other transfer of such
Presidio Shares by Purchaser shall be in accordance with the Act and that
neither the Company or its Affiliates or any Seller is obligated to register
such Presidio Shares pursuant to the Act. Purchaser acknowledges that the Shares
may contain a restrictive legend to effect of the foregoing.
<PAGE>
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(m) Public Information. Purchaser understands that all of the
representations and warranties of Seller contained herein are subject to all
information and documents contained in the public domain and Purchaser has no
knowledge that any of the representations and warranties of Seller are untrue,
incorrect, inaccurate or incomplete.
Section 4.3. Acknowledgments. Sellers and Purchaser acknowledge and
represent and warrant to each other that neither party has made any
representation or warranty, whether express or implied, of any kind or character
except as expressly set forth in this Agreement.
ARTICLE V
CONDITIONS TO SELLERS' OBLIGATIONS
The obligations of Sellers under this Agreement to consummate the sale of
the Presidio Shares to be acquired by Purchaser hereunder and the other
transactions contemplated hereby shall be subject to the satisfaction, on or
before the Closing Date, of the following conditions:
Section 5.1. Representations and Warranties True. The representations and
warranties contained in Section 4.2 hereof are true and accurate in all material
respects as of the date when made (or with respect to those representations
stated to be as of a different date, as of such date).
Section 5.2. Performance of Covenants. Purchaser shall have performed and
complied, in all material respects, with each and every covenant, agreement and
condition required by this Agreement to be performed or complied with by it
prior to or on the Closing Date.
Section 5.3. No Governmental Proceeding or Litigation. At the Closing Date,
no order, injunction, decree or judgment of any court or administrative agency
shall be in effect which restrains or prohibits the transactions contemplated
hereby, and no suit, action, investigation, inquiry or proceeding by any
governmental body, or legal or administrative proceeding by any governmental
body shall have been instituted, or threatened in writing, which questions the
validity or legality of the transactions contemplated hereby.
<PAGE>
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ARTICLE VI
CONDITIONS TO OBLIGATIONS OF PURCHASER
The obligations of Purchaser under this Agreement to consummate the
purchase of the Presidio Shares to be acquired by it hereunder and the other
transactions contemplated hereby shall be subject to the satisfaction, on or
before the Closing Date, of the following conditions:
Section 6.1. Representations and Warranties True. The representations and
warranties contained in Section 4.1 hereof are true and accurate in all material
respects as of the date when made (or with respect to those representations and
warranties stated to be as of a different date, as of such date).
Section 6.2. Performance of Covenants. Sellers shall have performed and
complied, in all material respects, with each and every covenant, agreement and
condition required by this Agreement to be performed or complied with by them
prior to or on the Closing Date.
Section 6.3. No Governmental Proceeding or Litigation. At the Closing Date,
no order, injunction, decree or judgment of any court or administrative agency
shall be in effect which restrains or prohibits the transactions contemplated
hereby, and no suit, action, investigation, inquiry or proceeding by any
governmental body, or legal or administrative proceeding by any governmental
body, shall have been instituted, or threatened in writing, which questions the
validity or legality of the transactions contemplated hereby.
ARTICLE VII
COVENANTS OF THE PARTIES
Section 7.1. Expenses. Except as otherwise provided herein, each party
hereto will pay its own costs and expenses incurred in connection with this
Agreement and the transactions contemplated hereby.
Section 7.2. Further Assurances. Each of the parties hereto will use all
reasonable efforts to take, or cause to be taken, all action, and to do, or
cause to be done, all
<PAGE>
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things necessary, proper or advisable under applicable laws and regulations to
consummate and make effective the sale of the Presidio Shares to be acquired by
Purchaser pursuant to this Agreement. From time to time after the date hereof,
without further consideration (except for reimbursement of actual out-of-pocket
expenses including any reasonable legal fees), each Seller will execute and
deliver such documents to Purchaser as Purchaser may reasonably request in order
to vest more effectively in Purchaser good title to the Presidio Shares to be
acquired by Purchaser hereunder (free of all Liens) or to confirm or perfect any
of the other transactions contemplated by this Agreement. From time to time
after the date hereof, without further consideration (except for reimbursement
of actual out-of-pocket expenses including reasonable legal fees), Purchaser
will execute and deliver such documents to each Seller as such Seller may
reasonably request in order to consummate more effectively the sale of the
Presidio Shares to be acquired by Purchaser hereunder or to confirm or perfect
any of the other transactions contemplated by this Agreement.
Section 7.3. Public Announcements; Confidentiality. Except for such
disclosures as may be required by law, legal process or regulatory authority,
neither party hereto shall issue any press release or otherwise make any
announcement or disclosure concerning the transactions herein contemplated
unless such information is already in the public domain.
Section 7.4. Sales and Transfer Taxes. All transfer taxes incurred in
connection with this Agreement and the transactions contemplated hereby shall be
borne equally by Sellers and Purchaser.
Section 7.5. Liberal Construction Purchaser shall not engage in any
transaction which is intended and structured specifically to avoid the creation
of any Net Proceeds or otherwise to frustrate the provisions of Section 2.2
hereof. It is intended by the parties hereto that transactions that result in
the effective transfer of beneficial ownership of any Presidio Shares acquired
hereunder and receipt of cash consideration in respect thereof by Purchaser and
its Affiliates shall be treated as Cash Distributions or sales of Presidio
Shares if and to the extent that the practical effect of such transaction is the
same as that of a Cash Distribution or sale of Presidio Shares; provided,
however, that the provisions of this Section shall not be construed to prohibit
bona fide transactions undertaken in good faith by Purchaser even though an
incidental effect of such transactions may be to transfer interests in Presidio
Shares without the generation of Net Proceeds.
<PAGE>
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Section 7.6. Limitation on Purchaser's Business Activities. Purchaser
shall, at all times until the sixth anniversary of the Closing Date, limit its
principal activities and business to ownership of (i) Presidio Shares and other
investments in the Company and Persons related to the Company, (ii) interests in
Related Companies and (iii) the ownership of any Non-cash Proceeds of such
assets.
ARTICLE VIII
SURVIVAL AND INDEMNIFICATION
Section 8.1. Survival of Agreements. The representations and warranties of
Seller and of Purchaser set forth in Article 4 hereof shall survive the Closing
for the period specified in Section 8.4; provided, however, that if any claim is
timely made for indemnification in respect of any breach of any thereof, such
represention and warranty shall survive until such claim is finally resolved by
a final, non-appealable judgment of a court of competent jurisdiction. In
addition, the following provisions of this Agreement shall survive the Closing
indefinitely: Article I, Sections 2.2 through Section 2.7, Article VII, Article
VIII and Article IX.
Section 8.2. Indemnification by Sellers. Each Seller shall indemnify and
hold harmless Purchaser from and against any and all Losses suffered or incurred
by Purchaser as a result of the breach or incorrectness of any representation
and warranty of such Seller set forth in Section 4.1 or Section 4.3 of this
Agreement. Purchaser shall promptly notify each Seller in writing of the
occurrence of any event, or of its discovery of any facts, which in Purchaser's
opinion entitle or may entitle it to indemnification hereunder. Purchaser's
failure to do so shall not preclude it from seeking indemnification hereunder
from any Seller unless such failure has materially prejudiced such Seller's
ability to defend as provided herein. With respect to any threatened or asserted
claims of third parties, Sellers shall have the right to defend such claims by
counsel of their choosing and to direct or control the defense and settlement
thereof. Purchaser shall cooperate in all reasonable respects with such counsel.
Section 8.3. Indemnification by Purchaser. Purchaser shall indemnify and
hold harmless each Seller from and against any and all Losses suffered or
incurred by such Seller as a result of the breach or incorrectness of any
representa-
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tion and warranty of such Seller set forth in Section 4.2 or Section 4.3 of this
Agreement or arising in connection with any Qualifying Litigation. Each Seller
shall promptly notify Purchaser in writing of the occurrence of any event, or of
its discovery of any facts, which in such Seller's opinion entitle or may
entitle it to indemnification hereunder. Any Seller's failure to do so shall not
preclude it from seeking indemnification hereunder from Purchaser unless such
failure has materially prejudiced Purchaser's ability to defend as provided
herein. With respect to any threatened or asserted claims of third parties,
Purchaser shall have the right to defend such claims by counsel of its choosing
and to direct or control the defense and settlement thereof. Sellers shall
cooperate in all reasonable respects with such counsel. In the event, with
respect to any Qualifying Litigation, Purchaser determines in good faith that
there is a conflict of interest or other reason that the same counsel could not
effectively represent Purchaser and any Seller, Purchaser shall so notify such
Seller and Purchaser shall engage separate counsel (acceptable to Sellers in
their reasonable discretion) to defend such Seller in respect of such Qualifying
Litigation.
Section 8.4. Limitations. Notwithstanding any contrary provision herein, no
party hereto shall be obligated to provide indemnity in respect of any Losses
relating to a breach of representation or warranty unless such party has been
given written notice thereof prior to the first anniversary of the Closing Date.
ARTICLE IX
MISCELLANEOUS
Section 9.1. No Waiver; Modifications in Writing. (a) No failure or delay
on the part of any Seller or Purchaser 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. The
remedies provided for herein are cumulative and are not exclusive of any
remedies that may be available to any Seller or Purchaser at law or in equity.
No waiver of or consent to any departure by any Seller or Purchaser from any
provision of this Agreement shall be effective unless in writing and signed by
the party entitled to the benefit thereof. No amendment, modification or
termination of any pro-
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vision of this Agreement shall be effective unless in writing and signed by or
on behalf of all Sellers and Purchaser. Any amendment, supplement or
modification of or to any of this Agreement, any waiver of any provision of this
Agreement, and any consent to any departure from the terms of any provision of
this Agreement, shall be effective only in the specific instance and for the
specific purpose for which made or given.
Section 9.2. Notices. All notices and demands provided for hereunder shall
be in writing, and shall be given by registered or certified mail, return
receipt requested, telecopy, courier service or personal delivery, and, if to
Purchaser, addressed to Purchaser at:
c/o Cahill Gordon & Reindel
80 Pine Street
New York, New York 10005
Attention: Managing Clerk
With a copy to:
Cahill Gordon & Reindel
80 Pine Street
New York, New York 10005
Attention: Richard J. Sabella
Telephone: (212) 701-3000
Telecopy: (212) 269-5420
or to such other address as Purchaser may designate to Sellers in writing and,
if to any Seller, addressed to such Seller at:
c/o Farallon Capital Management, L.L.C.
One Maritime Plaza
Suite 1325
San Francisco, California 94111
Attention: Meridee Moore, Esq.
Ms. Kirstin Lynch
Telephone: (415) 421-2132
Telecopy: (415) 421-2133
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With a copy to:
Richards Spears Kibbe & Orbe
One Chase Manhattan Plaza
57th Floor
New York, New York 10005
Attention: William Q. Orbe, Esq.
Telephone: (212) 530-1800
Telecopy: (212) 530-1801
or to such other address as any Seller may designate in writing. All such
notices and demands shall be deemed given when received.
Section 9.3. Fair Market Value. At any time that any provision contained
herein contemplates a determination of fair market value, Purchaser shall
provide Sellers with a written calculation or explanation of the methodology for
determining such value together with all appropriate supporting information and
documentation. Sellers shall have 10 Business Days from receipt of such written
calculation or explanation to dispute such calculation or explanation by so
notifying Purchaser. The parties shall negotiate in good faith for 30 days to
resolve such dispute. If such dispute is not resolved within such period, it
shall be submitted to the appraisal procedure, set forth in Schedule B annexed
hereto.
Section 9.4. Arbitration. In the event the parties shall fail to resolve
any dispute that is herein required to be resolved by arbitration, such dispute
shall be settled by arbitration in New York, New York in accordance with the
commercial arbitration rules of the American Arbitration Association. Any
arbitration required under this Agreement shall be conducted before a panel of
three arbitrators. Each of the Sellers and Purchaser shall choose an arbitrator,
and the third arbitrator shall be chosen by the arbitrators selected by the
parties. If a party fails to choose an arbitrator within 30 days after receiving
notice of a demand for arbitration, or if the two arbitrators fail to choose a
third arbitrator within 30 days after both are appointed, any party may request
the American Arbitration Association to appoint the arbitrator or arbitrators to
constitute or complete the panel of such arbitrators, and the appointment by the
American Arbitration Association shall be final and binding. Judgment upon the
award rendered in the arbitration may be entered in any court having
jurisdiction.
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Section 9.5. Liability Several. Notwithstanding any other provision of this
Agreement to the contrary, the obligations of Sellers under this Agreement are
several (and not joint).
Section 9.6. Execution in Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto on separate
counterparts, each of which counterparts, when so executed and delivered, shall
be deemed to be an original and all of which counterparts, taken together, shall
constitute but one and the same Agreement.
Section 9.7. Binding Effect; Assignment. The rights of Purchaser or Sellers
under this Agreement (other than the provisions of Section 2.2, Section 2.5,
Section 2.6, Section 7.2 and Article VIII) may not be assigned to any other
Person except with the prior written consent of the other parties hereto. This
Agreement shall not be construed so as to confer any right or benefit upon any
Person other than the parties to this Agreement, and their respective successors
and permitted assigns. This Agreement shall be binding upon Sellers and
Purchaser, and their respective successors and permitted assigns.
Section 9.8. GOVERNING LAW. THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT
MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF SAID STATE, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS.
Section 9.9. Severability of Provisions. Any provision of this Agreement
that is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.
Section 9.10. Headings. The Article and Section headings used or contained
in this Agreement are for convenience of reference only and shall not affect the
construction of this Agreement.
Section 9.11. No Reliance. Each party hereto acknowledges that it has
obtained separate advice with respect to the legal, tax and accounting
consequences of the transactions contemplated by this Agreement, and that it has
neither sought nor relied upon any such advice from any other party hereto or
its Affiliates.
<PAGE>
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Section 9.12. No Broker. Each of the parties hereto represents to the
others that no broker or finder was involved in such party's determination to
enter into the transactions contemplated in this Agreement.
Section 9.13. Entire Agreement. This Agreement and the Schedules hereto and
agreements executed contemporaneously herewith constitute the entire agreement
among the parties with respect to the purchase and sale of the Presidio Shares
to be acquired by Purchaser hereunder, and, as of the date hereof, there are no
promises or undertakings with respect thereto relative to the subject matter
hereof not expressly set forth or referred to herein.
<PAGE>
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
FARALLON CAPITAL PARTNERS, L.P.
By: Farallon Partners, L.L.C.,
its General Partner
By /s/ Meridee Moore
-------------------------------
Managing Member
FARALLON CAPITAL INSTITUTIONAL
PARTNERS, L.P.
By Farallon Partners, L.L.C.,
its General Partner
By /s/ Meridee Moore
-------------------------------
Managing Member
FARALLON CAPITAL INSTITUTIONAL
PARTNERS II, L.P.
By: Farallon Partners, L.L.C.,
its General Partner
By /s/ Meridee Moore
-------------------------------
Managing Member
TINICUM PARTNERS, L.P.
By Farallon Partners, L.L.C.,
its General Partner
By /s/ Meridee Moore
-------------------------------
Managing Member
<PAGE>
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FARALLON CAPITAL OFFSHORE INVESTORS, INC.
By Farallon Capital Management
L.L.C., its Agent and
Attorney-in-Fact
By /s/ Meridee Moore
-------------------------------
Managing Member
THE COMMOND FUND
By Farallon Capital Management,
L.L.C., its Agent and
attorney-in-Fact
By /s/ Meridee Moore
-------------------------------
Managing Member
CONSOLIDATED PRESS INTERNATIONAL LTD.
By Farallon Capital Management,
L.L.C., its Agent and
Attorney-in-Fact
By /s/ Meridee Moore
-------------------------------
Managing Member
PRESIDIO HOLDING COMPANY, LLC, Purchaser
By: /s/ Edward Scheetz
------------------------------
Name:
Title:
<PAGE>
<TABLE>
<CAPTION>
Schedule A
to Stock Purchase
Agreement
<S> <C> <C>
Name of Seller Shares Held
Farallon Capital Partners, L.P. 1,397,138
Farallon Capital Institutional Partners, L.P. 1,610,730
Farallon Capital Institutional Partners II, L.P. 607,980
Tinicum Partners, L.P. 241,671
Farallon Capital Management, L.L.C., on behalf of
Farallon Capital Offshore Investors, Inc.
The Common Fund 274,778
Consolidated Press
International Limited 153,783
267,300
</TABLE>
All funds owing to Sellers hereunder shall be wired to the following account:
Chase Manhattan Bank N.A.
ABA Number: 021-0000-21
FAO: Goldman Sachs & Co.
Account Number: 930-1-011-483
FBO: Farallon Capital Partners, L.P.
Acct Number: 002-001-88-1
Reference: Presidio
<PAGE>
Schedule B
to Stock Purchase
Agreement
Appraisal Procedure
In the event the provisions of the Agreement to which this Schedule B is
annexed shall require that a determination be made by appraisal as to the fair
market value of the Deferred Purchase Price (as defined in such Agreement) of
any Presidio Shares such determination shall be made in accordance with the
following appraisal procedure.
(i) The parties shall consult for the purpose of selecting a mutually
acceptable appraiser which (a) shall have at least 10 years
experience in appraising similar types of property, and (b) shall
not be an affiliate of any party hereto (each appraiser which
shall satisfy the requirements set forth in clauses (a) and (b)
of this sentence, an "Appraiser").
(ii) In the event the parties shall be unable to agree upon the
Appraiser within 15 days, each party shall appoint an Appraiser
within 15 days, and such Appraisers shall jointly determine the
matter.
(iii) In the event one party shall fail so to appoint an Appraiser
then the Appraiser appointed by the other party shall determine
the matter as the sole Appraiser.
(iv) In the event the two Appraisers cannot agree on such matter
within 20 days, such matter shall be determined by a third
Appraiser appointed by the two Appraisers designated by the
parties. The third Appraiser shall be instructed and empowered
only to select as the proper outcome of the matter in question,
the valuation that the third Appraiser believes to be the more
accurate.
<PAGE>
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(v) Each party shall be responsible for the fees and expenses of the
Appraiser appointed by it pursuant to clause (ii). Fees and
expenses of the Appraiser appointed in connection with clauses
(i) or (iv) of the foregoing appraisal procedure shall be paid in
equal shares by Sellers and Purchaser (each as defined in such
Agreement).
