Exhibit 10.41

 

AGREEMENT REGARDING PURCHASER BANK ARRANGEMENTS

 

This Agreement Regarding Purchaser Bank Arrangements (as amended, supplemented
or otherwise modified from time to time, the “Agreement”) is entered into as of
the 7th day of August, 2003, by and among Peregrine Systems, Inc., a Delaware
corporation and Debtor and Debtor In Possession (“Peregrine”) under Case No.
02-12740 (JKF), jointly administered (the “Case”) in the United States
Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) and
Peregrine Remedy, Inc., a Delaware corporation and also a Debtor and Debtor In
Possession (“Remedy”) in the Case, and each of Peregrine’s other Subsidiaries
who are signatories of this Agreement (Peregrine and Remedy, together with such
Subsidiaries, each, a “Peregrine Party,” and collectively, the “Peregrine
Parties”), on the one hand, and Fleet Business Credit, LLC, a Delaware limited
liability company, as successor to Sanwa Business Credit Corporation (“Fleet”),
Wells Fargo HSBC Trade Bank, N.A., a national banking association (the “Trade
Bank”), and Silicon Valley Bank, a California state bank (“SVB”; together with
Fleet and the Trade Bank, each, a “Purchaser,” and collectively, the
“Purchasers”), and Fleet, as agent for the Purchasers (in such capacity,
together with its successors in such capacity, “Purchaser Agent” and, together
with the Purchasers and Peregrine Parties, the “Parties”). This Agreement is
made with reference to the following facts and circumstances:

 

A.            Peregrine, Remedy and certain of the other Peregrine Parties are
currently obligated to the Purchasers pursuant to their respective Purchase
Documents (as defined below) and the Forbearance Agreement and Forbearance
Documents.

 

B.            Pursuant to that certain Order Pursuant to Section 1129 of the
Bankruptcy Code Confirming Debtors’ Fourth Amended Plan of Reorganisation, as
Modified, Dated July 14, 2003, the Bankruptcy Court has approved and confirmed
the Fourth Amended Plan of Reorganization of Peregrine Systems, Inc. and
Peregrine Remedy, Inc. (as modified, the “Plan”).

 

C.            Concurrently herewith, and in accordance with the provisions of
Section V of the Plan, the Existing Promissory Notes (as defined below) executed
by the Peregrine Parties in favor of the Purchasers pursuant to the Forbearance
Agreement (as defined below) are being satisfied and cancelled and, with the
exception of any liens, security interests and other interests granted to
Purchasers in and to the Purchased Accounts pursuant to the Purchasers’
respective Purchase Documents (the “Continuing Liens”), the Purchasers’ and
Purchaser Agent are terminating, reassigning, reconveying, discharging,
surrendering and otherwise releasing and relinquishing all Collateral heretofore
granted or assigned to or executed in favor of Purchasers and/or Purchaser Agent
in connection with the Purchase Obligations or other obligations of the
Peregrine Parties under the Purchase Documents, the Forbearance Agreement and/or
Forbearance Documents, as well as terminating the Forbearance Documents
themselves.

 

D.            In addition to the actions described in Recital C above, the
Peregrine Parties and Purchasers and Purchaser Agent wish to supplement, modify
and amend the Purchase Documents, as more particularly provided below.

 

E.             IT IS THE INTENT OF THE PARTIES THAT THIS AGREEMENT ADDRESS THE
DEBTS AND/OR OBLIGATIONS OF THE PEREGRINE PARTIES TO PURCHASERS

 

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THAT ARE DESCRIBED OR REFERRED TO HEREIN OR THAT ARISE UNDER OR IN CONNECTION
WITH THE PURCHASE DOCUMENTS (AS AMENDED HEREBY). THIS AGREEMENT DOES NOT PERTAIN
TO ANY OTHER INDEBTEDNESS AND/OR OBLIGATIONS OF ANY PEREGRINE PARTY (OR ANY
OTHER PERSONS) TO ANY PURCHASER NOT SPECIFICALLY ADDRESSED IN THIS AGREEMENT.
ALL TERMS AND PROVISIONS OF ANY AGREEMENTS (INCLUDING, BUT NOT LIMITED TO, THE
PURCHASE DOCUMENTS) BETWEEN ANY PEREGRINE PARTY, ON THE ONE HAND, AND ANY
PURCHASER, ON THE OTHER HAND, NOT SPECIFICALLY MODIFIED HEREIN OR RELEASED AND
DISCHARGED PURSUANT TO ONE OR MORE OF THE RELEASE AGREEMENTS, SHALL REMAIN IN
FULL FORCE AND EFFECT IN ACCORDANCE WITH THEIR ORIGINAL TERMS.

 

NOW, THEREFORE, in consideration of the above recitals and the mutual promises
contained in this Agreement and for other and further good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
Parties hereby agree, as follows:

 

1.   Defined Terms. As used herein, the following terms shall have the following
definitions:

 

“Agreement” is defined in the preamble to this Agreement.

 

“Bankruptcy Code” means the United States Bankruptcy Code, as in effect from
time to time.

 

“Bankruptcy Court” is defined in the preamble to this Agreement.

 

“Canadian Guaranty” means, collectively, each of the Guarantees, dated as of
August 26, 2002, by one of the Canadian Peregrine Parties in favor of each of
the Purchasers, as such agreements may heretofore have been amended,
supplemented or modified from time to time.

 

“Canadian Peregrine Parties” means Peregrine Systems of Canada, Inc., a
corporation organized under the laws of Canada, Peregrine Nova Scotia Company, a
Nova Scotia unlimited liability company, Peregrine Systems Ltd., a corporation
organized under the laws of Ontario, Peregrine Ottawa Nova Scotia Company, a
Nova Scotia unlimited liability company, Peregrine Networks Canada Inc., a
corporation organized under the laws of Canada, Loran International Technologies
Inc., a corporation organized under the laws of Canada, Loran Network Systems
Inc., a corporation organized under the laws of Canada, Remedy Canada Ltd., a
corporation organized under the laws of Ontario, and Extricity (Canada) Corp., a
Nova Scotia unlimited liability company and “Canadian Peregrine Party” means any
one of them.

 

“Canadian Security Agreement” means, collectively, each of the General Security
Agreements, each dated as of August 26, 2002, executed and delivered by one of
the Canadian Peregrine Parties in favor of Purchaser Agent, as such agreements
may heretofore have been amended, supplemented or modified from time to time.

 

“Canadian Security Documents” means, collectively, the Canadian Security
Agreement, the Hypothec, and the Canadian Guaranty, in each case, as may
heretofore have been amended, supplemented or modified from time to time.

 

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“Case” is defined in the preamble to this Agreement.

 

“Code” means the Uniform Commercial Code as in effect in the State of California
from time to time.

 

“Collateral” means all assets of any Peregrine Party heretofore securing all or
any portion of the obligations of the Peregrine Parties under the Purchase
Documents, Forbearance Agreement or the other Forbearance Documents.

 

“Continuing Liens” shall have the meaning ascribed to such term in Recital C of
this Agreement.

 

“Copyright Security Agreement” means, collectively, that certain Copyright
Security Agreement, dated as of August 26, 2002, between Peregrine and Purchaser
Agent, and that certain Copyright Security Agreement, dated as of August 26,
2002, between Remedy and Purchaser Agent, as such agreements may heretofore have
been amended, supplemented or modified from time to time.

 

“Effective Date” shall have the meaning ascribed to such term in the Plan.

 

“Existing Promissory Notes” means, with respect to each Purchaser, collectively,
all promissory notes executed by any Peregrine Party prior to the date hereof
that evidence Past Due Purchase Obligations (as defined in the Forbearance
Agreement) owing to such Purchaser by any Peregrine Party, including, without
limitation, those promissory notes described on ScheduleA attached hereto and
incorporated herein by this reference.

 

“Fleet” is defined in the preamble to this Agreement.

 

“Fleet Purchase Documents” means those agreements, instruments and documents
described on Schedule C attached hereto relative to the purchase by Fleet of
certain accounts and payments from Peregrine, as amended by this Agreement and
as the same may hereafter be amended, supplemented or otherwise modified from
time to time.

 

“Fleet Retained Accounts” means and refers to those certain those accounts and
other rights to payment purchased by set forth on Schedule B attached hereto and
incorporated herein by this reference.

 

“Forbearance Agreement” means and refers to that certain Forbearance Agreement
dated August 26, 2002, among the Peregrine Parties, Purchasers and Purchaser
Agent, as the same may heretofore have been amended, supplemented or modified
from time to time.

 

“Forbearance Documents” means this Agreement, the Peregrine Party Guaranty, the
Peregrine Party Security Agreement, the Canadian Guaranty, the Canadian Security
Agreement, the Hypothec, the other Canadian Security Documents, the
Intercreditor Agreement, the Interpurchaser Agreement, the Intercompany
Subordination Agreement, the Existing Promissory Notes, the Copyright Security
Agreement, the Patent Security Agreement, the Trademark Security Agreement, and
any other agreement, instrument or document heretofore entered into between any
Peregrine Party and any Purchaser or executed by any Peregrine Party in
connection

 

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with the Forbearance Agreement, in each case, as the same may heretofore have
been amended, supplemented or modified from time to time.

 

“Hypothec” means the Movable Hypothec, dated August 26, 2002, among Peregrine
Systems of Canada, Inc., Purchaser Agent, and Purchasers, as the same may
heretofore have been amended, supplemented or modified from time to time.

 

“Intercompany Subordination Agreement” means that certain Intercompany
Subordination Agreement, dated as of August 26, 2002, among the Peregrine
Parties, the Purchasers, and Purchaser Agent, as the same may heretofore have
been amended, supplemented or modified from time to time.

 

“Interpurchaser Agreement” means that certain Interpurchaser Agreement, dated as
of August 26, 2002, among the Purchasers, as may be amended, supplemented or
modified from time to time.

 

“Parties” shall have the meaning ascribed to it in the preamble to this
Agreement.

 

“Patent Security Agreement” means that certain Patent Security Agreement, dated
as of August 26, 2002, between Remedy and Purchaser Agent, as such agreement may
heretofore have been amended, supplemented or modified from time to time.

 

“Peregrine” is defined in the preamble to this Agreement.

 

“Peregrine Party” and “Peregrine Parties” shall have the meanings ascribed to
such terms in the preamble to this Agreement.

 

“Peregrine Party Guaranty” means, collectively, each of the General Continuing
Guaranties, dated as of August 26, 2002, by Peregrine, Remedy and the other
Peregrine Parties signatory thereto in favor of each of the Purchasers, as such
agreements may heretofore have been amended, supplemented or modified from time
to time.

 

“Peregrine Party Security Agreement” means that certain Security Agreement,
dated as of August 26, 2002, among Purchaser Agent, Peregrine, and each of
Peregrine’s subsidiaries signatory thereto, as such agreement may heretofore
have been amended, supplemented or modified from time to time.

 

“Person” means any natural person, corporation, limited liability company,
limited partnership, general partnership, limited liability partnership, joint
venture, trust, land trust, business trust, or other organization, irrespective
of whether it is a legal entity, and any government and any agency and any
political subdivision thereof.

 

“Purchase Documents” means the Fleet Purchase Documents, the SVB Purchase
Documents, and the Trade Bank Purchase Documents, in each case as amended hereby
or as from time to time hereafter supplemented, modified or amended.

 

“Purchased Accounts” means, with respect to each Purchaser, those accounts and
other rights to payment (including, without limitation, enforcement rights and
other contract rights

 

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related to such accounts and other rights to payment) purchased by such
Purchaser, or in which such Purchaser has acquired a security interest, pursuant
to such Purchaser’s Purchase Documents (and the security interest, if any,
granted in the contract underlying such account or other right to payment) that
remain outstanding on the date hereof, which arc described on Schedule D
attached hereto and incorporated herein by this reference, and, with respect to
Fleet, shall include, subject to paragraph 8 hereof, the Fleet Retained
Accounts.

 

“Purchaser” and “Purchasers” shall have the meanings ascribed to them in the
preamble hereto.

 

“Purchaser Agent” shall have the meaning ascribed thereto in the preamble
hereto.

 

“Release Agreements” means and refers collectively to those certain Mutual
Release Agreements of even date and executed and delivered concurrently
herewith, one among the Peregrine Parties and Fleet (the “Fleet Release
Agreement”), another among the Peregrine Parties and Trade Bank, a third among
the Peregrine Parties and SVB, and the last among Purchaser Agent (only in its
agency capacity) and the Peregrine Parties with each such Mutual Release
Agreement being individually referred to as a “Release Agreement.”

 

“Remedy” is defined in the preamble to this Agreement.

 

“Repurchase Amount” shall have the meaning ascribed to such term in Paragraph
4(a) of this Agreement.

 

“Stock” means all shares, options, warrants, interests, participations, or other
equivalents (regardless of how designated) of or in a Person, whether voting or
nonvoting, including common stock, preferred stock, or any other “equity
security” (as such term is defined in Rule 3a11-1 of the General Rules and
Regulations promulgated by the SEC under the Exchange Act).

 

“Subsidiary” of a Person means a corporation, partnership, limited liability
company, or other entity in which that Person directly or indirectly owns or
controls the shares of Stock having ordinary voting power to elect a majority of
the board of directors (or appoint other comparable managers) of such
corporation, partnership, limited liability company, or other entity.

 

“SVB” shall have the meaning ascribed to such term in the preamble to this
Agreement.

 

“SVB Purchase Documents” means those agreements, instruments and documents set
forth on Schedule E attached hereto relative to the purchase by SVB of certain
accounts and payments from Peregrine, as the same are amended by this Agreement
and as they may hereafter be amended, supplemented or otherwise modified from
time to time.

 

“Trade Bank” shall have the meaning ascribed to such term in the preamble to
this Agreement.

 

“Trade Bank Purchase Documents” means those agreements, instruments and
documents set forth on Schedule F attached hereto relative to the purchase by
the Trade Bank of certain

 

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accounts and payments from Peregrine, as the same are amended hereby and as they
may hereafter be amended, supplemented or otherwise modified from time to time.

 

“Trademark Security Agreement” means that certain Trademark Security Agreement,
dated as of August 26, 2002, between Peregrine and Purchaser Agent, as such
agreement may heretofore have been amended, supplemented or modified from time
to time.

 

2. Acknowledgment and Amendment of Purchase Documents.

 

(a) Peregrine hereby acknowledges, warrants and represents that the following
statements of facts regarding the Purchase Documents are true, correct and
complete:

 

(i)(a) As stated in the Fleet Purchase Documents, Fleet has purchased certain
accounts and other rights to payment, (b) as of the date hereof, the accounts
and other rights to payment purchased by Fleet that remain outstanding are those
set forth under the heading “Fleet Accounts” on Schedule D hereto; (c) the Fleet
Purchase Documents have not been amended at any time on or before the date
hereof except as specifically set forth in Schedule C; (d) the Fleet Purchase
Documents constitute duly authorized, valid, binding and continuing agreements
and obligations of Peregrine to Fleet, enforceable in accordance with their
respective terms; and (e) Peregrine has no claims, cross-claims, counterclaims,
setoffs or defenses of any kind or nature which would in any way reduce or
offset its obligations to Fleet under the Fleet Purchase Documents as of the
Effective Date.

 

(ii)(a) As stated in the SVB Purchase Documents, SVB has purchased certain
accounts and other rights to payment, (b) as of the Effective Date, the accounts
and other rights to payment purchased by SVB that remain outstanding are those
set forth under the heading “SVB Accounts” on Schedule D hereto; (c) the SVB
Purchase Documents have not been amended at any time on or before the date
hereof except as specifically set forth in Schedule E; (d) the SVB Purchase
Documents constitute duly authorized, valid, binding and continuing agreements
and obligations of Peregrine to SVB, enforceable in accordance with their
respective terms; and (e) Peregrine has no claims, cross-claims, counterclaims,
setoffs or defenses of any kind or nature which would in any way reduce or
offset its obligations to SVB under the SVB Purchase Documents as of the
Effective Date.

 

(iii)(a) As stated in the Trade Bank Purchase Documents, the Trade Bank has
purchased certain accounts and other rights to payment, (b) as of the Effective
Date, the accounts and other rights to payment purchased by the Trade Bank that
remain outstanding are set forth under the heading “Trade Bank Accounts” on
Schedule D hereto; (c) the Trade Bank Purchase Documents have not been amended
at any time on or before the date hereof except as specifically set forth in
Schedule F; (d) the Trade Bank Purchase Documents constitute duly authorized,
valid, binding and continuing agreements and obligations of Peregrine to the
Trade Bank, enforceable in accordance with their respective terms; and (e)
Peregrine has no claims, cross-claims, counterclaims, setoffs or defenses of any
kind or nature which would in any way reduce or offset its obligations to the
Trade Bank under the Trade Bank Purchase Documents as of the date of execution
of this Agreement.

 

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(b) Effective as of the Effective Date, and conditioned upon each Purchaser’s
receipt of the payment on account of its “Secured Purchaser Bank Claim” (as
defined in the Plan) required by Section V of the Plan, the Purchase Documents
are hereby modified and amended, as follows:

 

(i) The Fleet Purchase Documents are hereby modified and amended in the manner
described on Schedule G attached hereto and incorporated herein by this
reference;

 

(ii) The Trade Bank Purchase Documents are hereby modified and amended in the
manner described on Schedule H attached hereto and incorporated herein by this
reference; and

 

(iii)          The SVB Purchase Documents are hereby modified and amended in the
manner described on Schedule I attached hereto and incorporated herein by this
reference.

 

3. Scope of Agreement; Other Purchased Accounts. Nothing contained in this
Agreement shall be interpreted as or be deemed a release or a waiver by any
Purchaser of any of the terms or conditions of such Purchaser’s Purchase
Documents except as specifically provided in this Agreement. Unless specifically
modified herein, all other terms and provisions of the Purchase Documents shall
remain in full force and effect in accordance with their original terms;
provided that nothing in this Paragraph 3 or the other provisions of this
Agreement shall in any way be deemed to modify, limit or otherwise affect the
Release Agreement or the scope of the matters covered thereby.

 

As used in this paragraph, “Other Purchased Accounts” means, with respect to
each Purchaser, the accounts and other rights to payment purchased by such
Purchaser pursuant to its Purchase Documents that have been repaid by the
account debtor or obligor thereon or repurchased by a Peregrine Party and, as a
result of such repayment or repurchase, no amounts are owed to such Purchaser in
respect thereof. The Parties acknowledge that each Purchaser, pursuant to its
Purchase Documents purchased the Other Purchased Accounts but that, because no
amounts are owing to such Purchaser thereon as of the date hereof, the Other
Purchased Accounts are not identified herein as “Purchased Accounts.” Each
Purchaser shall retain for its own account all payments made prior to the date
hereof in respect of such Purchaser’s Purchased Accounts and Other Purchased
Accounts (including, without limitation, the “Interim Payments” as defined in,
and made pursuant to, the Agreed Order Nune Pro Tune December 30, 2002 Pursuant
to 11 U.S.C. §§ 105(a), 363(b)(l) and Federal Rule of Bankruptcy Procedure
90l9(a) Authorizing the Debtors to Use Property of the Estates Outside of the
Ordinary Course of Business and Approving Settlement by and Among Debtors, Fleet
Business Credit, LLC, Wells Fargo HSBC Trade Bank, N.A. and Silicon Valley
Bank). Each Purchaser shall also retain, with respect to all of its Other
Purchased Accounts not repurchased by a Peregrine Party, all of such Purchaser’s
rights and remedies against the account debtor or obligor thereon (it being
expressly understood that this sentence is not intended to reserve any right or
remedy of any Purchaser against any Peregrine Party).

 

4. Ongoing Repurchase Obligations. Notwithstanding anything to the contrary in
this Agreement, the Forbearance Agreement or any document or instrument executed
in connection

 

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herewith, each Purchaser’s rights under its respective Purchase Documents to
from time to time require Peregrine to repurchase Purchased Accounts shall
continue in full force and effect; provided that, notwithstanding anything to
the contrary in this Agreement or the Purchase Documents, Peregrine shall not be
obligated to pay or give any consideration to Fleet in connection with the
reassignment, reconveyance or other transfer of any Fleet Retained Account to
Peregrine. For their part, each Purchaser hereby agrees that, it will not
require Peregrine or any other Peregrine Party to repurchase any of such
Purchaser’s Purchased Accounts or otherwise seek to enforce any rights or
remedies under any of such Purchaser’s Purchase Documents based upon any default
in respect thereof in existence as of the date hereof or based upon any fact or
condition in existence as of the date hereof (whether or not the same
constitutes or gives rise to a default of a recurring nature) except as set
forth on Schedule J (attached hereto and incorporated by this reference).

 

5. Performance under Purchase Documents. All amounts received by any Peregrine
Party with respect to any Purchaser’s Purchased Accounts shall be remitted to
the appropriate Purchaser immediately upon receipt thereof by such Peregrine
Party in the same form so received, together with any necessary endorsements
thereto, and an appropriate accounting with respect to the same, and until so
remitted to the appropriate Purchaser shall be held in trust for the benefit of
such Purchaser and not commingled with any assets of any Peregrine Party.

 

6. Security Interest; Priority. The Continuing Liens with respect to the
Purchased Accounts shall be senior and first priority liens and security
interests in and to the Purchased Accounts.

 

7. Termination of Forbearance Document.   Effective on the Effective Date, and
conditioned upon each Purchaser’s receipt of the payment on account of its
Secured Purchaser Bank Claim required by Section V of the Plan, the Forbearance
Agreement shall, without further documentation or action by any Party, cease to
be of any further force or effect whatsoever. In that connection, each of the
Peregrine Parties hereby acknowledges and agrees that, effective upon the
Effective Date, the Purchasers’ obligations to forbear from exercising their
rights and remedies as provided in the Forbearance Agreement have terminated,
and that, subject to the Release Agreements and the last sentence of Paragraph 4
above, each Purchaser is entitled, in Purchaser’s discretion, to exercise any
and all of its rights and remedies under its respective Purchase Documents.

 

8. Fleet Retained Accounts. Notwithstanding anything to the contrary herein or
in any Release Agreement, to the extent mutually agreed upon prior to the
Effective Date by Fleet and the Peregrine Party(ies) from whom the Fleet
Retained Accounts were purchased, the security interests and other interests of
Fleet in and to each Fleet Retained Account shall continue in full force and
effect. Such agreement may also address Fleet’s ongoing enforcement of certain
rights or remedies in respect of the Fleet Retained Account. Unless and until
Fleet and the applicable Peregrine Party(ies) shall have entered into such an
agreement, in form and substance satisfactory to each of them, dealing with
matters relating to such enforcement, however, Fleet shall have no obligation to
exercise or pursue any enforcement rights or remedies with respect to any Fleet
Retained Account. Neither Fleet nor any Peregrine Party shall have any
obligation to enter into any such agreement and each of them expressly reserves
the right not to enter into any such agreement except at its sole discretion.

 

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9. Revival Clause. If the incurring of any debt or the payment of money or
transfer of property made to the Purchasers by or on behalf of any Peregrine
Party should for any reason subsequently be declared to be “fraudulent” or
“preferential” within the meaning of any state or federal law relating to
creditors’ rights, including, without limitation, fraudulent conveyances,
preferences or otherwise voidable or recoverable payments of money or transfers
of property, in whole or in part, for any reason (collectively, “Voidable
Transfers”) under the Bankruptcy Code or any other federal or state law, and the
Purchasers are required to repay or restore any such Voidable Transfer or the
amount or any portion thereof, or upon the advice of their in-house counsel or
outside counsel are advised to do so, then, as to such Voidable Transfer or the
amount repaid or restored (including all reasonable costs, expenses and
attorneys’ fees of the Purchasers related thereto), the obligations of the
Peregrine Parties under the Purchase Documents and this Agreement and all of the
Purchasers’ rights and remedies under the Purchase Documents and this Agreement
shall automatically be revived, reinstated and restored and shall exist as
though such Voidable Transfer had never been made, to the extent of any harm to
the Purchasers.

 

10. Notices.

 

Unless otherwise provided in this Agreement, all notices or demands to any
Peregrine Party, to any Purchaser, or to Purchaser Agent relating to this
Agreement or any Purchase Document shall be in writing and (except for financial
statements and other informational documents which may be sent by first-class
mail, postage prepaid) shall be personally delivered or sent by registered or
certified mail (postage prepaid, return receipt requested), overnight courier,
or facsimile to any Peregrine Party in care of Peregrine, to each Purchaser, or
to Purchaser Agent, as the case may be, at its address set forth below:

 

If to any Peregrine

 

 

 

Party:

 

PEREGRINE SYSTEMS, INC.

 

 

 

3611 Valley Centre Drive

 

 

 

San Diego, CA 92130

 

 

 

Attn: Kathy Vizas, Esq.

 

 

 

Fax No. 858-481-1751

 

 

 

 

 

with copies to:

 

PACHULSKI, STANG, ZIEHL, YOUNG,

 

 

 

JONES & WEINTRAUB

 

 

 

10100 Santa Monica Boulevard, 11th Floor

 

 

 

Los Angeles, CA 90067-4100

 

 

 

Attn: Richard Pachulski, Esq.

 

 

 

Fax No. 310-201-0760

 

 

 

 

If to Purchaser Agent:

 

FLEET BUSINESS CREDIT, LLC

 

 

 

One South Wacker Drive, Suite 3800

 

 

 

Chicago, IL 60606

 

 

 

Attn: Stuart Schwartz

 

 

 

Fax No. 312-782-6486

 

 

 

 

 

with copies to:

 

FLEET BUSINESS CREDIT, LLC

 

 

 

One South Wacker Drive, Suite 3800

 

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Chicago, IL 60606

 

 

 

Attn: General Counsel

 

 

 

Fax No. 312-853-1433

 

 

 

 

 

and copies to:

 

KAYE SCHOLER LLP

 

 

 

425 Park Avenue

 

 

 

New York, New York 10022

 

 

 

Attn: Richard Smolev, Esq.

 

 

 

Fax No. 212-836-8689

 

 

 

 

If to Fleet:

 

FLEET BUSINESS CREDIT, LLC

 

 

 

One South Wacker Drive

 

 

 

Chicago, IL 60606

 

 

 

Attn: Stuart Schwartz

 

 

 

Fax No. 312-782-6486

 

 

 

 

 

with copies to:

 

FLEET BUSINESS CREDIT, LLC

 

 

 

One South Wacker Drive

 

 

 

Chicago, IL 60606

 

 

 

Attn: General Counsel

 

 

 

Fax No. 312-853-1433

 

 

 

 

 

and copies to:

 

KAYE SCHOLER LLP

 

 

 

425 Park Avenue

 

 

 

New York, New York 10022

 

 

 

Attn: Richard Smolev, Esq.

 

 

 

Fax No. 212-836-8689

 

 

 

 

 

If to SVB:

 

SILICON VALLEY BANK

 

 

 

38 Technology Drive, Suite 150

 

 

 

Irvine, CA 92618

 

 

 

Attn: Marla Johnson

 

 

 

Fax No. 949-789-1930

 

 

 

 

 

with copies to:

 

LEVY SMALL & LALLAS

 

 

 

815 Moraga Drive

 

 

 

Los Angeles, CA 90049

 

 

 

Attn: Leo Plotkin, Esq.

 

 

 

Fax No. 310-471-7990

 

 

 

 

If to Trade Bank:

 

WELLS FARGO HSBC TRADE BANK, N.A.

 

 

 

333 South Grand Avenue, Suite 940

 

 

 

Los Angeles, CA 90071

 

 

 

Attn: Mr. Ernie Pinder

 

 

 

Fax No. 213-253-5913

 

 

 

 

 

with copies to:

 

WELLS FARGO HSBC TRADE BANK, N.A.

 

 

 

333 South Grand Avenue, Suite 1040

 

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Los Angeles, CA 90071

 

 

 

Attn: Christine Keranore, Esq.

 

 

 

Fax No. 213-626-4812

 

 

 

 

 

and copies to:

 

PILLSBURY WINTHROP LLP

 

 

 

650 Town Center Drive, 7th Floor

 

 

 

Costa Mesa, CA 92626

 

 

 

Attn: Craig A. Barbarosh, Esq.

 

 

 

Fax No. 714-436-2800

 

 

Purchaser Agent, Purchasers and the Peregrine Parties may change the address at
which they are to receive notices hereunder, by notice in writing in the
foregoing manner given to the other party. All notices or demands sent in
accordance with this section, other than notices by any Purchaser in connection
with enforcement rights in respect of any Continuing Lien under the provisions
of the Code and other than notices by any Peregrine Party regarding a change of
any Peregrine Party’s name, shall be deemed received on the earlier of the date
of actual receipt or 3 Business Days after the deposit thereof in the mail. Each
Peregrine Party acknowledges and agrees that notices sent by the Purchasers in
connection with the enforcement of the Continuing Liens under the provisions of
the Code shall be deemed sent when deposited in the mail or personally
delivered, or, where permitted by law, transmitted by facsimile or any other
method set forth above. Any notice by any Peregrine Party regarding a change of
any Peregrine Party’s name shall be deemed received only upon the actual receipt
thereof.

 

11. Authority. Each Party represents and warrants to the others that: (A) it has
authority to execute this Agreement; (B) the execution, delivery and performance
of this Agreement does not require the consent or approval of any other Person;
and (C) this Agreement is a valid, binding and legal obligation of such Party
enforceable in accordance with its terms, and does not contravene or conflict
with any other agreement, indenture or undertaking to which such Party is a
party.

 

12. Payment of Expenses. Without limiting the obligation of Peregrine and Remedy
to pay the attorneys’ fees and expenses of any Purchaser or Purchaser Agent on
or prior to the Effective Date in accordance with the Plan, to the extent any
such attorneys’ fees and expenses payable by Peregrine or Remedy under the Plan
are not paid on or prior to the Effective Date, each of Peregrine and Remedy,
jointly and severally, agrees to pay such attorneys’ fees and expenses promptly
after their receipt of an invoice therefor and a reasonably detailed description
of the costs and activities underlying such invoice. In the event any action
(whether or not in a court proceeding) shall be required to interpret,
implement, modify, or enforce the terms and provisions of this Agreement, or any
of the Purchase Documents, and/or to declare rights under same, the prevailing
party in such action shall recover from the losing party all of its reasonable
fees and costs, including, but not limited to, the reasonable attorneys’ fees
and costs (if applicable) of each Purchaser’s outside counsel and the reasonable
allocated costs of each Purchaser’s in-house counsel.

 

13. Governing Law. This Agreement shall be construed and interpreted in
accordance with and shall be governed by the laws of the State of California,
without regard to the conflict of laws principles thereof.

 

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14. Successors. Assignment. This Agreement shall be binding on and inure to the
benefit of all of the parties hereto, and upon the heirs, executors,
administrators, legal representatives, successors and assigns of the Parties
(including, without limitation, Reorganized Peregrine Systems, Inc.), and each
of them. The terms and provisions of this Agreement are for the exclusive
benefit of the Peregrine Parties and the Purchasers, and may not be transferred,
assigned, pledged, set over or negotiated by any Peregrine Party to any Person
without the prior express written consent of the Purchasers. Notwithstanding any
other provisions contained herein, each Purchaser may sell, transfer, negotiate,
assign or grant participations m all or a portion of its rights in any of the
Purchase Documents and this Agreement to any Person without prior notice to any
Peregrine Party, provided, however, that any such assignee shall be bound by the
terms and provisions of the Purchase Documents and this Agreement.

 

15. Complete Agreement of Parties. This Agreement, together with the Purchase
Documents, the Release Agreements and the confidentiality agreements executed by
each of the Purchasers and Peregrine prior to the date hereof, constitute the
entire agreement between the Purchasers, on the one hand, and the Peregrine
Parties, on the other hand, arising out of, related to or connected with the
subject matter of this Agreement. Any supplements, modifications, waivers or
terminations of this Agreement shall not be binding unless executed in writing
by the parties to be bound thereby. No waiver of any provision of this Agreement
shall constitute a waiver of any other provisions of this Agreement (whether
similar or not), nor shall such waiver constitute a continuing waiver unless
otherwise expressly so provided. To the extent of any inconsistency between the
terms and provisions of the Purchase Documents and those of this Agreement or
any Release Agreement, this Agreement and the Release Agreement shall govern and
control, but except to such extent, the terms and provisions of the Purchase
Documents shall be unchanged and remain in full force and effect.

 

16. Execution In Counterparts; Facsimile Execution. This Agreement may be
executed in any number of counterparts each of which, when so executed and
delivered, shall be deemed an original, and all of which together shall
constitute but one and the same agreement.  Delivery of an executed counterpart
of this Agreement by facsimile shall be equally as effective as delivery of a
manually executed counterpart. Any party hereto delivering an executed
counterpart of this Agreement by facsimile shall also deliver a manually
executed counterpart, but the failure to so deliver a manually executed
counterpart shall not effect the validity, enforceability or binding effect
hereof.

 

17. Contradictory Tcrms/Severability. In the event that any term or provision of
this Agreement contradicts any term or provision of any other document,
instrument or agreement between the parties including, but not limited to, any
of the Purchase Documents, the terms of this Agreement shall control. If any
provision of this Agreement shall be invalid, illegal or otherwise
unenforceable, such provision shall be severable from all other provisions of
this Agreement, and the validity, legality and enforceability of the remaining
provisions of this Agreement shall not be adversely affected or impaired, and
shall thereby remain in full force and effect.

 

18. Headings. All headings contained herein are for convenience purposes only,
and shall not be considered when interpreting this Agreement.

 

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19. Further Assurances. The Parties hereto shall cooperate with each other in
carrying out the terms and intent of this Agreement, and shall execute such
other documents, instruments and agreements as are reasonably required to
effectuate the terms and intent of this Agreement (the reasonable legal fees and
expenses incurred by the Purchasers and/or Purchaser Agent in connection
therewith (including, without limitation, the reasonable legal fees and expenses
incurred in connection with the termination of any liens or security interests)
to be reimbursed by Peregrine and Remedy, jointly and severally). Without
limiting the generality of the foregoing, each Peregrine Party shall cooperate
with the Purchasers in the collection of the accounts and other rights to
payment purchased by the Purchasers from any Peregrine Party, which cooperation
shall include, but not be limited to contacting the account debtors or other
Persons obligated on such accounts or other rights to payment and directing that
payment be made directly to the applicable Purchaser, providing the Purchasers
with information and copies of documents relating to such accounts and rights to
payment, giving the Purchasers access to the Peregrine Parties’ personnel, books
and records, and otherwise consulting with and assisting the Purchasers in the
collection of such accounts and rights to payment.

 

20. Course of Dealing: Waivers. No course of dealing on the part of the
Purchasers, or their respective officers, nor any failure or delay in the
exercise of any right(s) by the Purchasers, shall operate as a waiver thereof,
and any single or partial exercise of any such right(s) shall not preclude any
later exercise of any such right(s). The Purchasers’ failure at any time to
require strict performance by the Peregrine Parties of any provision shall not
affect any right(s) of the Purchasers thereafter to demand strict compliance and
performance. Any suspension or waiver of a right(s) must be in writing signed by
the Purchasers.

 

21. Consultation with Counsel. Each party hereto acknowledges that it is freely
and voluntarily entering into this Agreement. Moreover, each party hereto also
acknowledges that it has been represented by counsel of its own choice at each
stage in the negotiation of this Agreement, or has knowingly and voluntarily
elected not to be represented by counsel at each stage in the negotiation of
this Agreement. To the extent any party was represented by counsel, said party
acknowledges that: (A) it has relied on such counsel’s advice throughout all of
the negotiations which preceded the execution of this Agreement, and in
connection with the preparation and execution of this Agreement; (B) such
counsel has read and approved this Agreement; and (C) such counsel has advised
such party concerning the validity and effectiveness of this Agreement, and the
transactions to be consummated in accordance therewith.

 

22. Limitation of Liability of Certain Peregrine Parties. Nothing herein shall
be deemed to impose upon any Peregrine Party that was not originally a party to
any Purchase Document any liability or obligation under or in connection with
any Purchase Document, it being the Parties’ express intent that following the
Effective Date, the only Parties’ obligated under the Purchase Documents shall
be those Parties who were parties thereto prior to the execution and delivery of
the Forbearance Agreement and Forbearance Documents.

 

23. Bankruptcy Court Jurisdiction: Waiver of Jury Trial. Until substantial
consummation (as defined in 11 U.S.C. sec. 1101(2)) of the Plan, the Bankruptcy
Court shall have exclusive jurisdiction to resolve and determine all disputes
and other matters arising in connection with the interpretation or enforcement
of this Agreement (collectively, “Disputed Matters”) and each Party hereby

 

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expressly consents and submits to such jurisdiction. Following such substantial
consummation of the Plan, jurisdiction shall be non-exclusive and shall lie in
such state or federal court(s) as may properly assert jurisdiction over the
Disputed Matter in question. THE PARTIES HERETO, AND EACH OF THEM, HEREBY
IRREVOCABLY WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO ANY OF THE PURCHASE DOCUMENTS, THIS
AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED THEREBY OR HEREBY.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement regarding
Purchaser Bank Arrangements to be executed and delivered as of the date first
written above.

 

The Purchasers:

FLEET BUSINESS CREDIT, LLC,

 

a Delaware limited liability company, as a
Purchaser and as Purchaser Agent

 

 

 

 

 

By:

/s/ [ILLEGIBLE]

 

 

Its:

Senior Vice President

 

 

 

 

 

SILICON VALLEY BANK

 

a California state bank

 

 

 

By:

/s/ Marla Johnson

 

 

Its:

Senior Vice President

 

 

 

 

 

 

WELLS FARGO HSBC TRADE BANK, N.A.,

 

a National Banking Association

 

 

 

By:

/s/ Ernie Pinder

 

 

Its:

ERNIE PINDER

 

 

 

RELATIONSHIP MANAGER

 

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The Peregrine Parties:

PEREGRINE SYSTEMS, INC.,
a Delaware corporation

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

CEO and President

 

 

 

 

 

 

 

 

 

 

PEREGRINE REMEDY, INC.,

 

 

a Delaware corporation

 

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

CEO and President

 

 

 

 

 

 

 

 

 

 

TELCO RESEARCH CORPORATION,

 

a Tennessee corporation

 

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

CEO & President

 

 

 

 

 

 

 

 

 

 

PEREGRINE DIAMOND, INC.,

 

 

a Delaware corporation

 

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

CEO & President

 

 

 

 

 

 

 

 

 

 

PEREGRINE CALIFORNIA PADRES, INC.,
a Delaware corporation

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

CEO & President

 

 

 

 

 

 

 

 

 

 

PEREGRINE ONTARIO BLUE JAYS, INC.,
a Delaware corporation

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

CEO & President

 

 

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BALLGAME ACQUISITION
CORPORATION, a Delaware corporation

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

President & CEO

 

 

 

 

 

 

 

 

 

 

OCTOBER ACQUISITION
CORPORATION, a Delaware corporation

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

Director, CEO & President

 

 

 

 

 

 

 

 

 

 

PEREGRINE BODHA, INC.,

 

 

a California corporation

 

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

CEO & President

 

 

 

 

 

 

 

 

 

 

PEREGRDSK FEDERAL SYSTEMS, INC.,

 

an Illinois corporation

 

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

CEO, President and Director

 

 

 

 

 

 

 

 

 

 

LORAN NETWORK SYSTEMS, LLC,

 

a Delaware limited liability company

 

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

Director

 

 

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PEREGRINE SYSTEMS OF CANADA, INC.,

 

a corporation organized under the laws of Canada

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

Director and President

 

 

 

 

 

 

 

 

 

 

PEREGRINE NOVA SCOTIA COMPANY,

 

a Nova Scotia unlimited liability company,

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

Director and President

 

 

 

 

 

 

 

 

 

 

PEREGRINE SYSTEMS LTD.,

 

 

a corporation organized under the laws of Ontario

 

 

 

 

 

By:

/s/ Kathryn Vizas

 

 

Its:

Director and Secretary

 

 

 

 

 

 

 

 

 

 

PEREGRINE OTTAWA NOVA SCOTIA
COMPANY, a Nova Scotia unlimited liability company

 

 

 

 

 

By:

/s/ Kathryn Vizas

 

 

Its:

Director and President

 

 

 

 

 

 

 

 

 

 

PEREGRINE NETWORKS CANADA INC.,

 

a corporation organized under the laws of Canada

 

 

 

 

 

By:

/s/ Kathryn Vizas

 

 

Its:

Director and President

 

 

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LORAN INTERNATIONAL
TECHNOLOGIES INC., a corporation
organized under the laws of Canada

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

Director and President

 

 

 

 

 

 

 

 

 

 

LORAN NETWORK SYSTEMS INC.,

 

a corporation organized under the laws of Canada

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

Director and President

 

 

 

 

 

 

 

 

 

 

REMEDY CANADA LTD.,

 

 

a corporation organized under the laws of Ontario

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

Director and President

 

 

 

 

 

 

 

 

 

 

EXTRICITY (CANADA) CORP.,

 

 

a Nova Scotia unlimited liability company

 

 

 

 

 

By:

/s/ Gary G. Greenfield

 

 

Its:

Director and President

 

 

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