Morgan Stanley Investment Banking Pitch Book
Portions of this exhibit marked [*] are requested to be treated confidentially
Project Roosevelt
THIRD-PARTY ALTERNATIVES
Submitted Proposal Summary Terms
Trousdale Whole Co Acquisition Proposal
• Cash offer of $2.25 per share, submitted March 2nd
- [Expiration extended to Wednesday, March 16th]
• Requests exclusivity period of approx. four weeks
• Diligence could be completed "expeditiously in a matter of days"
• No stated financing contingency; Cain Hoy Enterprises identified
as a possible financing source
• Yucaipa reportedly to roll the principal amount of its preferred
equity ($75MM balance)
Morgan Stanley
• If deal not signed by end of exclusivity period, Trousdale
reimbursed accrued deal expenses of approx. $1.5MM
• Break-up as previously negotiated
• Requires certain shareholders must enter into voting support
agreements for the acquisition
- Vector, Yucaipa, Rambleside, Pine River, OTK and Hamamoto
Strictly Confidential
[******************] Structured Proposal
• Structured proposal submitted on March 3rd by
********] to acquire the Hudson and Delano South
Beach for $540MM (both encumbered); proceeds to retire Yucaipa
preferred equity
• Monroe would receive:
[*********
- HMA for [*******] ([****] is currently under contract to acquire
from [********]) for 2.5% fee on all hotel and F&B revenue(¹)
-Opportunity to purchase 3.5 % [********], for $12MM
- Potential access to $20MM of key money funding through a fully
accruing 2-year term loan at 10% coupon or acquiring shares of stock
• [*****] to receive:
- Guest lists for each of Monroe's properties for the past 10 years
- 18MM warrants to purchase Monroe shares at a price of $1.25 per
share(2)
-Two board seats ([**********] as Vice Chairman and [*********
as Monroe CEO)
- Veto rights on all capital event, asset, investment, personnel and other
management decisions
- 30-day exclusivity; breakup fee of $10MM; termination permissible
only if asset sale price is $560MM or greater
• No reference to diligence requirements or timing
Notes
1. It its proposal, [*****] estimates stabilized hotel revenue at over $35MM
2. The warrants may be exercised at any time and will expire at the end of a three year term. The warrants shall have standard anti-dilution adjustment provisions for stock splits, dividends etc. and below fair
market stock issuances
29View entire presentation