FRED MEYER, INC.
P.O. Box 42121 3800 S.E. 22nd Avenue
Portland, OR 97242
(503) 232-8844 TLX 360415
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KENNETH THRASHER
SENIOR VICE PRESIDENT--FINANCE
& CHIEF FINANCIAL OFFICER
FRED MEYER, INC. -- MOGON
P.O. BOX 42121
PORTLAND, OR 97242
PHONE: (503) 797-7900
FAX: (503) 797-5299
August 15, 1996
Mr. Dave Ramus
PacTrust, Suite 300
15350 SW Sequoia Pkwy.
Portland, OR 97224
Dear Dave:
Pursuant to our phone conversation on August 6, 1996, I am sending you this
confirming letter of our agreement. We will take down the purchase of seven
store locations, termination of the Stark lease, and various other lease
amendments in a two-step transaction to occur as follows:
ON OR BEFORE AUGUST 16, 1996:
Purchase the following three locations, with the
transfer of ownership made to Fred Meyer, Inc.: Interstate $ 6,045,085
Oak Grove $ 7,095,220
Stadium $ 4,693,665
[PAYMENT TO BE MADE BY FRED MEYER, INC.] TOTAL, Aug. 1996 $17,833,970
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ON OR BEFORE DECEMBER 31, 1996:
We plan on closing on the four other store locations, the Stark lease
cancellation (and assignment of sub-tenant to Properties, Ltd.), and the
agreed-upon amendments to various lease terms in this time frame. The four
locations being purchased will go into one of our lease lines with
NationsBank, and include:
Burlingame $ 4,231,472
Glisan $ 6,251,003
Gresham $11,516,661
Tigard $ 8,289,894
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[PAYMENT TO BE MADE BY NATIONSBANK] SUB-TOTAL $30,289,030
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Plus: Stark lease
[PAYMENT TO BE MADE BY FRED MEYER, INC.] cancellation $ 677,000
-----------
TOTAL, Dec. 1996 $30,966,030
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[CONT'D]
These two closings will result in payments of $40,000,000 to Properties,
Ltd., (payment being made to parties designated by you) pursuant to our
agreement to close the purchases on or before December 31, 1996.
I did receive your phone-mail message regarding contingencies and believe
that we still need to be diligent with respect to property purchases
considering the accelerated closing of the transactions, which gets you
funds earlier than planned. We will waive the contingencies relation to the
sale-leaseback and MET property deals and do have Board approval of the
transaction. I only know of two current issues that we need to work with
you to resolve, those being:
i.) clarification and assurance that the Gresham property lines
give us control of the property based on what we expected when
this transaction was negotiated; and
ii.) we have proposed a "condominium," form of agreement at the
Burlingame site for your Burger King tenant that we believe is
reasonable and needs your acceptance.
Assuming these two issues are resolved in a timely manner, I see no reason
why the second closing cannot occur in the time line proposed.
Please execute and return a copy of this letter so we can proceed to achieving
the first closing by the end of next week. If you have questions concerning
this letter, please call me at 797-7900. Thank you.
Sincerely,
KENNETH THRASHER
Kenneth Thrasher
Senior Vice President - Finance
& Chief Financial Officer
APPROVED BY: DAVID W. RAMUS
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Name
Real Estate Prop. L.P./REC Resolutions
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Company
Date: 8/15/96
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cc: Robert G. Miller
Scott Wippel
Bob Currey-Wilson
Jim Aalberg