SC 13D/A

Number of

Shares

Beneficially

Owned by

Each

Reporting

Person

With

Sole Voting Power

115,324.39

Shared Voting Power

0

Sole Dispositive Power

115,324.39

Shared Dispositive Power

0

0001193125-21-265426.txt : 20210903 0001193125-21-265426.hdr.sgml : 20210903 20210903144400 ACCESSION NUMBER: 0001193125-21-265426 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20210903 DATE AS OF CHANGE: 20210903 GROUP MEMBERS: CHARLES J. SCHREIBER, JR. GROUP MEMBERS: KBS CAPITAL ADVISORS LLC GROUP MEMBERS: KEITH D. HALL GROUP MEMBERS: WILLOWBROOK CAPITAL GROUP, LLC SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: Pacific Oak Strategic Opportunity REIT, Inc. CENTRAL INDEX KEY: 0001452936 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 263842535 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-89627 FILM NUMBER: 211236148 BUSINESS ADDRESS: STREET 1: 11766 WILSHIRE BLVD. STREET 2: SUITE 1670 CITY: LOS ANGELES STATE: CA ZIP: 90025 BUSINESS PHONE: 949-417-6500 MAIL ADDRESS: STREET 1: 11766 WILSHIRE BLVD. STREET 2: SUITE 1670 CITY: LOS ANGELES STATE: CA ZIP: 90025 FORMER COMPANY: FORMER CONFORMED NAME: KBS Strategic Opportunity REIT, Inc. DATE OF NAME CHANGE: 20081230 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: MCMILLAN PETER CENTRAL INDEX KEY: 0001182336 FILING VALUES: FORM TYPE: SC 13D/A SC 13D/A 1 d216519dsc13da.htm SC 13D/A SC 13D/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. 1)*

Pacific Oak Strategic Opportunity REIT, Inc.

(Name of Issuer)

Common Stock, par value $0.01 per share

(Title of Class of Securities)

694701103

(CUSIP Number)

Charles J. Schreiber, Jr.

KBS Capital Advisors LLC

800 Newport Center Drive, Suite 700

Newport Beach, California 92660

(949) 417-6500

Peter McMillan III

Willowbrook Capital Group, LLC

11766 Wilshire Blvd., Suite 1670

Los Angeles, California 90025

(424) 208-8100

with a copy to:

Robert H. Bergdolt, Esq.

Carrie Joan Hartley, Esq.

Christopher R. Stambaugh, Esq.

DLA Piper LLP (US)

4141 Parklake Avenue, Suite 300

Raleigh, North Carolina 27612-2350

(919) 786-2000

(Name, Address and Telephone Number of Person

Authorized to Receive Notices and Communications)

September 1, 2021

(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(e), 13d-1(f) or 13d-1(g), check the following box. ☐

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 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).


CUSIP No. 694701103		Schedule 13D


1		Name of Reporting Person KBS Capital Advisors LLC
2		Check the Appropriate Box if a Member of a Group (a) ☐ (b) ☒
3		SEC Use Only
4		Source of Funds (See Instructions) OO
5		Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) ☐
6		Citizenship or Place of Organization Delaware


CUSIP No. 694701103		Schedule 13D


1		Name of Reporting Person Willowbrook Capital Group, LLC
2		Check the Appropriate Box if a Member of a Group (a) ☐ (b) ☒
3		SEC Use Only
4		Source of Funds (See Instructions) OO
5		Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) ☐
6		Citizenship or Place of Organization Delaware


CUSIP No. 694701103		Schedule 13D


1		Name of Reporting Person Keith D. Hall
2		Check the Appropriate Box if a Member of a Group (a) ☐ (b) ☒
3		SEC Use Only
4		Source of Funds (See Instructions) OO
5		Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) ☐
6		Citizenship or Place of Organization United States


CUSIP No. 694701103		Schedule 13D


1		Name of Reporting Person Peter McMillan III
2		Check the Appropriate Box if a Member of a Group (a) ☐ (b) ☒
3		SEC Use Only
4		Source of Funds (See Instructions) OO
5		Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) ☐
6		Citizenship or Place of Organization United States


CUSIP No. 694701103		Schedule 13D


1		Name of Reporting Person Charles J. Schreiber, Jr.
2		Check the Appropriate Box if a Member of a Group (a) ☐ (b) ☒
3		SEC Use Only
4		Source of Funds (See Instructions) OO
5		Check Box if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) ☐
6		Citizenship or Place of Organization United States

Responses to each item of this Statement on Schedule 13D are incorporated by reference into the response to each other item, as applicable.

Item 1.

Security and Issuer

This Amendment No. 1 supplements and amends the Schedule 13D filed on April 6, 2020 by the Reporting Persons (as defined below) (as so amended, the “Schedule 13D”), relating to the shares of common stock, par value $0.01 per share (the “Common Stock”), of Pacific Oak Strategic Opportunity REIT, Inc., a Maryland corporation (the “Issuer”). Each Item below amends and supplements the information disclosed under the corresponding Item of the Schedule 13D filed on April 6, 2020. Unless otherwise indicated herein, capitalized terms used but not defined in this Amendment No. 1 shall have the same meanings herein as are ascribed to such terms in the Schedule 13D filed on April 6, 2020. The Issuer’s principal executive offices are located at 11766 Wilshire Blvd., Suite 1670, Los Angeles, California 90025.

Item 2.

Identity and Background

(a)

This Statement on Schedule 13D is being filed by the persons and entities listed in items (i) through (v) below (collectively, the “Reporting Persons”):

(i)

KBS Capital Advisors LLC, a Delaware limited liability company (“KBS”);

(ii)

Willowbrook Capital Group, LLC, a Delaware limited liability company (“Willowbrook”)

(iii)

Keith D. Hall, a United States citizen;

(iv)

Peter McMillan III, a United States citizen; and

(v)

Charles J. Schreiber, Jr., a United States citizen.

At the time of the original Schedule 13D filing on April 6, 2020, because of the relationships described below, the Reporting Persons made a single, joint filing because they may have been deemed to constitute a “group” within the meaning of Rule 13d-5 under the 1934 Act, and as such, each member of the group could be deemed to beneficially own, in the aggregate, all of the shares held by members of the group.

At the time of the original Schedule 13D filing on April 6, 2020 and until September 1, 2021, PBren Investments, L.P. (a Delaware limited partnership), Schreiber Real Estate Investments, L.P. (a Delaware limited partnership) and GKP Holding LLC (a Delaware limited liability company) (“GKP”), each was a manager of KBS and of KBS Holdings LLC (“KBS Holdings”) (a Delaware limited liability company), which wholly owns KBS. As of April 6, 2020 and until September 1, 2021, PBren Investments, L.P., Schreiber Real Estate Investments, L.P. and GKP each owned 1/3 of KBS Holdings. PBren Investments, LLC (a Delaware limited liability company) is the general partner of PBren Investments, L.P., and PBCS Management, LLC (a Delaware limited liability company) is the manager of PBren Investments, LLC. Schreiber Investments, LLC (a California limited liability company) is the general partner of Schreiber Real Estate Investments, L.P., and PBCS Management, LLC is the manager of Schreiber Investments, LLC. Charles J. Schreiber, Jr. is the sole manager of PBCS Management, LLC. Keith D. Hall and Peter McMillan III are the managers of GKP and each own 50% of GKP.

Keith D. Hall and Peter McMillan III own and control Willowbrook.

As described in Item 6 below, on September 1, 2021, GKP ceased to be a manager of KBS and KBS Holdings and ceased to own an interest in KBS Holdings (the “Ownership Change”). As a result of this Ownership Change, Mr. Schreiber and KBS could no longer be deemed to constitute a “group” with the other Reporting Persons within the meaning of Rule 13d-5 under the 1934 Act. As such, no Reporting Person could be deemed to beneficially own, in the aggregate, 5% of the Issuer’s outstanding shares of Common Stock. This Schedule 13D constitutes the final amendment to the Schedule 13D with respect to the Reporting Persons.

(b)

The business address of KBS and Mr. Schreiber is:

c/o KBS Capital Advisors LLC

800 Newport Center Drive, Suite 700

Newport Beach, California 92660

The business address of Willowbrook and Messrs. Hall and McMillan is:

c/o Willowbrook Capital Group, LLC

11766 Wilshire Blvd., Suite 1670

Los Angeles, California 90025

(c)

KBS is a registered investment adviser with the Securities and Exchange Commission (“SEC”) and is engaged in the business of acting as external advisor to real estate programs. KBS is the former external advisor of the Issuer. KBS Holdings, PBren Investments, L.P., PBren Investments, LLC, PBCS Management, LLC, Schreiber Real Estate Investments, L.P. and Schreiber Investments, LLC are holding companies through which Mr. Schreiber owns and/or operates KBS or other real estate-related businesses.

The principal business address of KBS Holdings, PBren Investments, L.P., PBren Investments, LLC, PBCS Management, LLC, Schreiber Real Estate Investments, L.P. and Schreiber Investments, LLC is:

800 Newport Center Drive, Suite 700

Newport Beach, California 92660

GKP and Willowbrook are holding companies through which Messrs. Hall and McMillan own and/or operate real estate-related businesses.

The principal business address of GKP is:

11766 Wilshire Blvd., Suite 1670

Los Angeles, California 90025

Keith D. Hall and Peter McMillan III are employees and principals of Pacific Oak Capital Advisors, LLC (the “Advisor”), the Issuer’s external advisor. In addition, Keith D. Hall is the Chief Executive Officer and Director of the Issuer and Peter McMillan III is the Chairman of the Board, President and Director of the Issuer. They also serve as officers and/or directors of other real estate companies advised by the Advisor and/or one or more of its affiliates.

Mr. Schreiber is the Chief Executive Officer and principal of KBS and/or one or more of its affiliates. He also serves as an officer and/or director of real estate companies advised by KBS and/or one or more of its affiliates.

Item 3.

Source and Amount of Funds or Other Consideration

See Item 6 below.

Item 4.

Purpose of Transaction

The Issuer’s securities reported herein and in the Schedule 13D filed on April 6, 2020 were acquired or disposed of by the Reporting Persons as described in this Schedule 13D and the Schedule 13D filed on April 6, 2020. The Reporting Persons hold the securities reported herein for investment purposes, subject to the following.

Pursuant to an advisory agreement, dated November 1, 2020 (the “Advisory Agreement”), between the Issuer and the Advisor, subject to the express limitations set forth in the Advisory Agreement and the continuing and exclusive authority of the Issuer’s Board of Directors (the “Board”) over the management of the Issuer, the power to direct the management, operation and policies of the Issuer, including making, financing and disposing of investments, is vested in the Advisor, which has the power by itself and is authorized and empowered on behalf and in the name of the Issuer to carry out any and all of the objectives and purposes of the Issuer and to perform all acts and enter into and perform all contracts and other undertakings that it may in its sole discretion deem necessary, advisable or incidental thereto to perform its obligations under the Advisory Agreement. Pacific Oak Holding Group, LLC, a Delaware limited liability company, is the sole member of the Advisor. Keith D. Hall and Peter McMillan III are the members of Pacific Oak Holding Group, LLC and each own 50% of Pacific Oak Holding Group, LLC. In addition, Keith D. Hall is the Chief Executive Officer and Director of the Issuer and Peter McMillan III is the Chairman of the Board, President and Director of the Issuer. In such capacities, these individuals will continue to have influence over the corporate activities of the Issuer, including activities which may relate to items described in subparagraphs (a) through (j) of Item 4 of Schedule 13D.

Subject to the terms and conditions of the Restricted Stock Agreement and Amendment No. 1 to the Restricted Stock Agreement (described in Item 6, the “Amendment”), the Reporting Persons may seek to sell or otherwise dispose of some or all of the Issuer’s securities (which may include, but is not limited to, selling some or all of such securities to the Issuer in its share redemption program, transferring some or all of such securities to its affiliates or distributing some or all of such securities to such Reporting Person’s respective partners, members or beneficiaries, as applicable) from time to time, and/or may seek to acquire additional securities of the Issuer (which may include rights or securities exercisable, exchangeable or convertible into securities of the Issuer), from time to time, in each case, in open market or private transactions, through the Issuer’s dividend reinvestment plan, as stock dividends, as payment of management fees or otherwise. Any such transactions may be made by the Reporting Persons at any time and from time to time without prior notice and will depend on a variety of factors, including, without limitation, satisfaction of the vesting terms and other conditions set forth in the Restricted Stock Agreement and the Amendment, the price and availability of the Issuer’s securities, subsequent developments affecting the Issuer, the Issuer’s business and the Issuer’s cash flow and prospects, other investment and business opportunities available to the Reporting Persons, general industry and economic conditions, the securities markets in general, tax considerations and other factors deemed relevant by the Reporting Persons.

Except as set forth in this Schedule 13D, the Reporting Persons and, to the best knowledge of the Reporting Persons, any of the other individuals named in Item 2 above, have no present plans, proposals or intentions which would result in or relate to any of the transactions described in subparagraphs (a) through (j) of Item 4 of Schedule 13D. Although the foregoing reflects activities presently contemplated by the Reporting Persons and any other person named in Item 2 with respect to the Issuer, the foregoing is subject to change at any time.

Item 5.

Interest in Securities of the Issuer

(a)-(b)

As of September 3, 2021, KBS beneficially owns, and Mr. Schreiber may be deemed to indirectly beneficially own, an aggregate of 115,324.39 shares of Common Stock, which represent approximately 0.1% of the outstanding shares of Common Stock. As of September 3, 2021, Willowbrook beneficially owns an aggregate of 811,784.424 shares of Common Stock, which represent approximately 0.8% of the outstanding shares of Common Stock. As of September 3, 2021, Messrs. Hall and McMillan may be deemed to indirectly beneficially own an aggregate of 3,066,073.424 shares of Common Stock, which represent approximately 3.2% of the outstanding shares of Common Stock. The percentage of beneficial ownership reported in this Schedule 13D is based on an aggregate of 97,272,224 shares of Common Stock outstanding as of September 3, 2021.

KBS has the power to vote or to direct the vote, and the power to dispose or to direct the disposition, of 115,324.39 shares of Common Stock, which represent approximately 0.1% of the outstanding shares of Common Stock. Charles J. Schreiber, Jr. may be deemed to have the power to vote or to direct the vote, and may be deemed to have the power to dispose or to direct the disposition, of the securities beneficially owned directly by KBS, and may be deemed to be the beneficial owner of such securities.

Willowbrook has the power to vote or to direct the vote, and the power to dispose or to direct the disposition, of 811,784.424 shares of Common Stock, which represent approximately 0.8% of the outstanding shares of Common Stock. Keith D. Hall and Peter McMillan III (as the owners of Willowbrook) may be deemed to have the shared power to vote or to direct the vote, and may be deemed to have the shared power to dispose or to direct the disposition, of the securities beneficially owned directly by Willowbrook, and may be deemed to be the beneficial owners of such securities.

GKP has the power to vote or to direct the vote, and the power to dispose or to direct the disposition, of 2,254,289 shares of Common Stock, which represent approximately 2.3% of the outstanding shares of Common Stock. Keith D. Hall and Peter McMillan III (as the owners of GKP) may be deemed to have the shared power to vote or to direct the vote, and may be deemed to have the shared power to dispose or to direct the disposition, of the securities beneficially owned directly by GKP, and may be deemed to be the beneficial owners of such securities.

The filing of this statement shall not be construed as an admission that Messrs. Schreiber, Hall or McMillan is, for the purposes of Sections 13(d) or 13(g) of the 1934 Act, the beneficial owner of any securities covered by this statement.

(c)

See Item 6 below.

Except as set forth in Item 6 below, none of the Reporting Persons, or, to the best knowledge of the Reporting Persons, any other person named in Item 2 has engaged in any transaction during the past 60 days in any shares of Common Stock.

(d)

Except as set forth in Item 6 below, to the best knowledge of the Reporting Persons, no one other than the Reporting Persons, or the partners, members, affiliates or shareholders of the Reporting Persons has the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, the Common Stock acquired by them.

(e)

As described in Item 6 below, on September 1, 2021, GKP ceased to be a manager of KBS and KBS Holdings and ceased to own an interest in KBS Holdings. As a result of this Ownership Change, Mr. Schreiber and KBS could no longer be deemed to constitute a “group” with the other Reporting Persons within the meaning of Rule 13d-5 under the 1934 Act. As such, no Reporting Person could be deemed to beneficially own, in the aggregate, 5% of the Issuer’s outstanding shares of Common Stock.

Item 6.

Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer

Amendment No. 1 to Restricted Stock Agreement and Share Transfer Agreements

On September 1, 2021, KBS, the Issuer, and GKP, an affiliate of Messrs. Hall and McMillan, entered into Amendment No. 1 to the Restricted Stock Agreement (the “Amendment”). In addition, on September 1, 2021, KBS and GKP entered into the Unvested Share Transfer Agreement (the “Unvested Share Agreement”).

Pursuant to the Amendment, on September 1, 2021, the Issuer repurchased 584,267 of the Restricted Shares from KBS for consideration of $5,655,705 in cash, or $9.68 per share.

Pursuant to the terms of the Amendment and the Unvested Share Agreement, on September 1, 2021, KBS transferred 2,254,289 of the Restricted Shares to GKP (the “GKP Restricted Shares”). KBS transferred the GKP Restricted Shares as partial consideration for and to effectuate the conclusion of the acquisition of GKP’s 1/3 ownership interest in KBS Holdings by PBren Investments, L.P. and Schreiber Real Estate Investments, L.P. On September 1, 2021, upon the transfer of GKP’s 1/3 ownership interest in KBS Holdings, GKP ceased to be a manager of KBS and KBS Holdings and ceased to have an ownership interest in KBS Holdings.

Under the Amendment, the GKP Restricted Shares are nonvested and forfeitable until the earliest of: (i) July 1, 2026 or (ii) immediately before and contingent upon the occurrence of a Change in Control (as defined in the Restricted Stock Agreement) of the Issuer. Notwithstanding the foregoing, and at the option of either Keith Hall’s estate or Peter McMillan’s estate, in the event of the death of either Keith Hall or Peter McMillan, such event can trigger the vesting of that number of GKP Restricted Shares corresponding to 100% of the deceased party’s proportional economic interest in GKP Restricted Shares. In addition, unvested GKP Restricted Shares will be forfeited in certain instances if GKP fails to comply with certain requirements set forth in the Amendment, which forfeiture may be waived by the Issuer’s Conflict Committee in certain cases.

Non-vested GKP Restricted Shares are not eligible for redemption by the Issuer under any circumstances unless approved by the Board. After the vesting of the GKP Restricted Shares, and only upon receiving a request from GKP and the consent of the Issuer’s Conflicts Committee, within 60 days from the request, the Issuer will redeem 50% of the vested GKP Restricted Shares, with the amount of the cash payment per share determined based on the then most recent Board-approved net asset value per share (which must not be more than six months old). Any vested GKP Restricted Shares that are not required to be redeemed in accordance with the preceding sentence are referred to herein as the “Retained Vested GKP Shares.” The Retained Vested GKP Shares are not eligible for redemption under the Issuer’s share redemption program unless the Issuer has satisfied all outstanding redemption requests from other stockholders, provided that this restriction may be waived in certain situations, such as upon a change of control of the Issuer, as determined by the Conflicts Committee of the Board.

Additionally, on September 2, 2021, KBS and GKP entered into the Participant Share Transfer Agreement (the “Participant Share Agreement). Pursuant to the Participant Share Agreement, KBS transferred Common Stock to certain specified current or former employees of the Advisor, KBS or its affiliates for such employee’s profit participation interest in certain shares of Common Stock that were owned by KBS (the “Participants”). Notwithstanding the foregoing, pursuant to the Participant Share Agreement, at each Participant’s election, KBS paid up to 50% of the profit participation interest in the shares of Common Stock allocated to each Participant in cash rather than in Common Stock, provided that if no election was received by KBS the payment was made 50% in Common Stock and 50% in cash. Additionally, due to the small amount of shares allocated to two Participants, two Participants were paid 100% in cash. The cash payments to Participants were determined based on most recent estimated value per share approved by the Issuer’s board of directors of $9.68 as of December 4, 2020. On September 2, 2021, KBS transferred 513,467 shares of Common Stock to the Participants pursuant to the Participant Share Agreement. Messrs. Hall, McMillan and Schreiber were not Participants.

The Amendment also provides that an additional 59,714 Restricted Shares held by KBS were immediately vested and fully released from all restrictions and requirements of the Restricted Stock Agreement (the “KBS Retained Vested Shares”), provided that the KBS Retained Vested Shares are not eligible for redemption under the Issuer’s share redemption program unless the Issuer has satisfied all outstanding redemption requests from other stockholders, provided further that (i) this restriction may be waived in certain situations, such as upon a change of control of the Issuer, as determined by the Conflicts Committee of the Board and (ii) notwithstanding the foregoing, within 60 days after November 1, 2024, the Issuer will be required to redeem any remaining outstanding KBS Retained Vested Shares, separate and outside of any general stockholder share redemption program, at the then most recent Board-approved net asset value per share (which must not be more than six months old).

The foregoing description of the Amendment, the Unvested Share Agreement and the Participant Share Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the agreements, which are filed as exhibits to this Schedule 13D and incorporated herein by reference.

Item 7.

Material to Be Filed as Exhibits


Exhibit 1		Amendment No. 1 to Restricted Stock Agreement, dated as of September 1, 2021

Exhibit 2		Unvested Share Transfer Agreement, dated as of September 1, 2021

Exhibit 3		Participant Share Transfer Agreement, dated as of September 2, 2021

Exhibit 4		Joint Filing Agreement by and among KBS Capital Advisors LLC, Willowbrook Capital Group, LLC, Keith D. Hall, Peter McMillan III and Charles J. Schreiber, Jr., dated April 6, 2020 (incorporated by reference to Exhibit 1 to the Schedule 13D filed with the SEC on April 6, 2020)

SIGNATURES

After reasonable inquiry and to the best knowledge and belief of each of the undersigned, each of the undersigned certifies that the information set forth in this statement with respect to such person is true, complete and correct.


Dated: September 3, 2021	KBS CAPITAL ADVISORS LLC

	By:	PBren Investments, L.P., a Manager

		By:	PBren Investments, LLC, as general partner

			By:	PBCS Management, LLC, a Manager

				By:	/s/ Charles J. Schreiber, Jr.
					Charles J. Schreiber, Jr., Manager

	By:	Schreiber Real Estate Investments, L.P., a Manager

		By:	Schreiber Investments, LLC, as general partner

			By:	PBCS Management, LLC, a Manager

				By:	/s/ Charles J. Schreiber, Jr.
					Charles J. Schreiber, Jr., Manager

	WILLOWBROOK CAPITAL GROUP, LLC

	By:	/s/ Keith D. Hall
		Keith D. Hall, Authorized Person

	By:	/s/ Peter McMillan III
		Peter McMillan III, Authorized Person

	KEITH D. HALL

	/s/ Keith D. Hall

	PETER MCMILLAN III

	/s/ Peter McMillan III

	CHARLES J. SCHREIBER, JR.

	/s/ Charles J. Schreiber, Jr.

EX-99.1 2 d216519dex991.htm EX-99.1 EX-99.1

Exhibit 1

PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

AMENDMENT NO. 1 TO RESTRICTED STOCK AGREEMENT

FOR

KBS CAPITAL ADVISORS LLC

THIS AMENDMENT NO. 1 TO RESTRICTED STOCK AGREEMENT (this “Amendment”), dated and effective as of September 1, 2021, is made by and among Pacific Oak Strategic Opportunity REIT, Inc. (the “Company”), KBS Capital Advisors LLC (the “Recipient”), and GKP Holding LLC, a Delaware limited liability company (“GKP”).

W I T N E S S E T H

WHEREAS, the Company and the Recipient have previously entered into that certain Restricted Stock Agreement, dated as of March 27, 2020 (the “Agreement”);

WHEREAS, the Company and the Recipient desire to amend the Agreement as set forth herein;

WHEREAS, GKP desires to become a party to this Amendment, as set forth herein; and

WHEREAS, capitalized terms used but not defined herein shall have the meanings given to such terms in the Agreement.

NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements contained herein, the parties hereto agree as follows:

1. Vesting and Release of Certain Shares of Restricted Stock. The parties hereby agree that 1,157,448 of the Shares of Restricted Stock awarded to Recipient pursuant to the Agreement shall, subject to restrictions and requirements under the Company’s charter and any applicable securities laws, be immediately vested, transferable and fully released from all restrictions and requirements under the Agreement, but shall be subject to any applicable restrictions under this Amendment including but not limited to those under Section 4 and Section 10. Such Shares are defined herein as the “Released Shares”.

2. Repurchase of Certain Shares of Restricted Stock. For consideration of $5,655,705 in cash, paid by the Company to the Recipient contemporaneously with the execution of this Agreement, Recipient does hereby sell, assign, transfer, convey, grant, bargain, set over, release and deliver 584,267 of the Released Shares of Restricted Stock awarded to Recipient pursuant to the Agreement back to the Company, its successors and assigns, to have and to hold forever, free and clear of any security interest, pledge, mortgage, lien (including environmental and tax liens), charge, encumbrance, adverse claim, preferential arrangement, or restriction of any kind, including, without limitation, any restriction on the use, voting, transfer, receipt of income or other exercise of any attributes of ownership. Such Shares are defined herein as the “Repurchased Shares”.

3. Transfer of Certain Shares of Restricted Stock. The parties hereby agree that for good and valuable consideration, receipt of which is hereby acknowledged, the Recipient does hereby sell, assign, transfer, convey, grant, bargain, set over, release and deliver 2,254,289 of the Shares of Restricted Stock awarded to Recipient pursuant to the Agreement to GKP, its successors and assigns, to have and to hold forever, free and clear of any security interest, pledge, mortgage, lien (including environmental and tax liens), charge, encumbrance, adverse claim, preferential arrangement, or restriction of any kind, including, without limitation, any restriction on the use, voting, transfer, receipt of income or other exercise of any attributes of ownership, other than those restrictions set forth in the Company’s charter and specifically set forth herein. Such Shares are defined herein as the “GKP Restricted Shares”.

4. Remaining Shares. With respect to Released Shares not repurchased pursuant to Section 2 of this Amendment and other than the 513,467 Released Shares to be transferred to the Affiliated Transferees (as defined in Section 10(e)), such remaining Released Shares (the “Retained Vested Shares”) shall not be eligible for redemption under the Company’s share redemption program unless the Company has satisfied all outstanding redemption requests from other stockholders, provided that (a) this restriction may be waived in certain situations, such as upon a change of control of the Company, as determined by the Conflicts Committee of the Board and (b) notwithstanding the foregoing, within 60 days after November 1, 2024, the Company shall be required to redeem, and the holder will transfer to the Company, any remaining outstanding Retained Vested Shares, separate and outside of any general stockholder share redemption program, at the then most recent Board-approved net asset value per Share (which shall not be more than six months old). The number of Shares governed by this Section 4 is 59,714.

5. Restrictions on GKP Restricted Shares. The GKP Restricted Shares shall be subject to the terms, provisions and restrictions set forth in this Amendment.

6. Vesting of GKP Restricted Shares.

(a) General Vesting. All of the GKP Restricted Shares are nonvested and forfeitable as of the date of this Amendment. Subject to the terms of this Amendment, all of the GKP Restricted Shares shall vest on the earliest of the following: (i) July 1, 2026; or (ii) immediately before and contingent upon the occurrence of a Change in Control (as defined below). Notwithstanding the foregoing, and at the option of either Keith Hall’s estate or Peter McMillan’s estate, that in the event of the death of either Keith Hall or Peter McMillan, such event can trigger the vesting of that number of GKP Restricted Shares corresponding to 100% of the deceased party’s proportional economic interest in GKP Restricted Shares.

(b) Acceleration of Vesting at Company Discretion. Notwithstanding any other term or provision of this Agreement, the Board shall be authorized, in its sole discretion, to accelerate the vesting of any GKP Restricted Shares under this Amendment, at such times and upon such terms and conditions as the Board shall deem advisable.

(i) “Non-Vested GKP Restricted Shares” means any portion of the GKP Restricted Shares subject to this Amendment that has not become vested pursuant to this Section 6.

(ii) “Vested GKP Restricted Shares” means any portion of the GKP Restricted Shares subject to this Amendment that is and has become vested pursuant to this Section 6.

7. Delivery of GKP Restricted Shares.

(a) Issuance of Stock Certificates and Legends. One or more stock certificates evidencing the GKP Restricted Shares shall be issued in the name of GKP but shall be held and retained by the records administrator of the Company until the date (the “GKP Applicable Date”) on which the GKP Restricted Shares (or a portion thereof) become Vested GKP Restricted Shares. All such stock certificates shall bear the following legend, along with such other legends that the Company shall deem necessary and appropriate:

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO SUBSTANTIAL VESTING, TRANSFER AND OTHER RESTRICTIONS AS SET FORTH IN THE RESTRICTED STOCK AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. SUCH RESTRICTIONS ARE BINDING ON TRANSFEREES OF THESE SHARES, AND INCLUDE VESTING CONDITIONS WHICH MAY RESULT IN THE COMPLETE FORFEITURE OF THE SHARES.

(b) Stock Powers. GKP shall deposit with the Company stock powers or other instruments of transfer or assignment, duly endorsed in blank with signature(s) guaranteed, corresponding to each certificate representing GKP Restricted Shares (or if GKP Restricted Shares are issued without certificates, corresponding to all the GKP Restricted Shares registered in the name of GKP) until such GKP Restricted Shares become Vested GKP Restricted Shares. If GKP shall fail to provide the Company with any such stock power or other instrument of transfer or assignment, the Recipient hereby irrevocably appoints the Secretary of the Company as his attorney-in-fact, with full power of appointment and substitution, to execute and deliver any such power or other instrument which may be necessary to effectuate the transfer of the GKP Restricted Shares (or assignment of distributions thereon) on the books and records of the Company.

(c) Delivery of Stock Certificates. On or after each GKP Applicable Date, upon written request to the Company by GKP, the Company shall promptly cause a new certificate or certificates to be issued for and with respect to all GKP Restricted Shares that become Vested GKP Restricted Shares on that GKP Applicable Date, which certificate(s) shall be delivered to GKP as soon as administratively practicable after the date of receipt by the Company of GKP’s written request. The new certificate or certificates shall continue to bear those legends and endorsements that the Company shall deem necessary or appropriate (including those relating to

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restrictions on transferability and/or obligations and restrictions under any applicable securities laws). If the GKP Restricted Shares are issued without certificates, then on or after each GKP Applicable Date, upon written request to the Company by GKP, the Company shall promptly take such action as shall be necessary or appropriate to reflect on the Company’s books and records (and on the books and records of the transfer agent for the Company’s Shares), that those GKP Restricted Shares that vest on that GKP Applicable Date are Vested GKP Restricted Shares.

(d) Issuance Without Certificates. If the Company is authorized to issue GKP Restricted Shares without certificates, then the Company may, in the discretion of the Company’s management, issue GKP Restricted Shares pursuant to this Amendment without certificates.

8. Forfeiture of Shares. Notwithstanding any other provision of this Amendment to the contrary, any Non-Vested GKP Restricted Shares will be immediately forfeited under the following circumstances described below:

(a) Failure to Honor Non-Compete and Liquidity Agreement. All Non-Vested GKP Restricted Shares shall be forfeited immediately if GKP or any of its Affiliates fail to honor and observe either provision of the following provisions (the “Non-Compete and Liquidity Agreement”). Notwithstanding the foregoing, to the extent that only one of either Mr. McMillan or Mr. Hall violates any of the non-compete provisions, only that number of Non-Vested GKP Restricted Shares corresponding to the violating party’s proportional economic interest in Non-Vested GKP Restricted Shares shall be forfeited. GKP agrees to the following arrangement with respect to the Company in connection with the receipt of the GKP Restricted Shares:

1. After the date of this Amendment, GKP and its affiliates will not form a competing entity in commercial real estate investment management to the Company, which has a similar focus on opportunistic commercial real estate investments, without Conflicts Committee approval. This includes in the non-traded REIT space, public REITs, or separate account management for institutional accounts including, but not limited to domestic pension funds (public or corporate), international pension funds (public or corporate), sovereign wealth funds, family offices, or any other institutional investor. The Company recognizes the existence of Pacific Oak (where “Pacific Oak” is defined as Pacific Oak Capital Advisors LLC and its affiliates other than the Company and its subsidiaries) investment programs either currently in place or in process including, but not limited to Battery Point, DayMark, PORT II or other single-family rental focused entities, the SmartStop Self Storage Joint Venture, Pacific Oak Holdings, and KORE Pacific Advisors. It is further recognized that to be considered a competing entity, the Company must have capital to invest at the time.

2. Pacific Oak will enable the Company to provide meaningful liquidity to its shareholders within five years from the date of this Amendment, defined as successfully converting to an NAV REIT with an expanded share redemption plan, or a public listing, or reopening the share redemption plan for ordinary redemptions, announcing and

beginning a liquidation plan for the Company, or a similarly significant liquidity event to any of the foregoing liquidity events.

(b) Failure to Vote. Until November 1, 2021, all of GKP’s Non-Vested Shares shall be forfeited immediately, at the Conflict Committee’s discretion, in any of the following circumstances:

•

If GKP attends or returns a proxy to be present at a meeting of Company stockholders, but fails to either: (1) abstain on any matters that the Board determines that GKP cannot vote on pursuant to the Company’s charter or otherwise should abstain and provides GKP with 5 business days’ prior written notice of such determination or (2) with respect to all other matters, vote all GKP Restricted Shares in accordance with the recommendations of the Board.

•

If GKP fails to attend or return a proxy to be present at a meeting of Company stockholders if such meeting has been adjourned at least once in order to obtain additional stockholder attendance or votes and GKP has been given 5 business days’ prior written notice of such fact.

(c) Nomination of Directors. Until November 1, 2021, all Non-Vested GKP Restricted Shares shall be forfeited immediately if GKP makes any stockholder nominations of directors to the Board, unless the Conflicts Committee of the Board has provided its prior written consent to such nomination(s).

(d) Compliance with Law. If necessary to satisfy any law, regulation, rule or administrative decision with respect to the Company’s ongoing operations, including any ongoing offering of Common Stock, the Company shall have authority to cause the forfeiture of any Non-Vested GKP Restricted Shares and replace any such forfeited Non-Vested GKP Restricted Shares with a form of compensation that is, as close as reasonably practicable as determined in the Board’s discretion, economically equivalent as of the date of such replacement or modification.

(e) Transfer of Interests in GKP. GKP represents and warrants that Peter McMillan and Keith Hall each own 50% ownership interests in GKP and are the only managers of GKP. All of Vested GKP Restricted Shares and/or Non-Vested GKP Restricted Shares may be forfeited immediately, at the Conflict Committee’s discretion, upon any transfer of ownership interests in GKP without the Company’s prior consent. Transfers for Estate Planning or community property settlement are not subject to this provision and are therefore approved as of the date of this agreement.

9. Enforcement.

(a) GKP acknowledges and agrees that its obligations set forth in Section 8(a) are independent covenants and agreements and can be enforced by the Company separate and apart from this Amendment, and are a condition precedent to this Amendment. Therefore, in addition to any other provision or remedy set forth in this Amendment, the Company shall be entitled to

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all remedies at law and equity resulting from breach of the obligations of set forth in Section 8(a) and such remedies shall be cumulative with all provisions of this Amendment.

(b) GKP acknowledges and agrees that the injury that would be suffered by the Company or its Affiliates as a result of violation of Section 8(a) would be irreparable and that an award of monetary damages to the Company or its Affiliates for such a breach would be an inadequate remedy. Consequently, the forfeiture of Non-Vested GKP Restricted Shares is fair and reasonable under the circumstances.

(c) If any provision of Section 8(a) is held to be unreasonable, arbitrary, or against public policy, such covenant and corresponding forfeiture will be considered to be divisible, including with respect to scope, time, geographic area and number of Non-Vested GKP Restricted Shares to be forfeited, and such lesser scope, time, geographic area or number of Non-Vested GKP Restricted Shares, or all of them, as a court of competent jurisdiction may determine to be reasonable, not arbitrary, and not against public policy, will be effective, binding, and enforceable against GKP to the maximum extent permitted by applicable law.

10. Rights with Respect to Restricted Stock.

(a) General. Except as otherwise provided in this Amendment, GKP, successors and assigns shall have, with respect to all of the GKP Restricted Shares, whether Vested GKP Restricted Shares or Non-Vested GKP Restricted Shares, all of the rights of a holder of Shares of common stock of the Company, including without limitation (i) the right to vote such GKP Restricted Shares, (ii) the right to receive dividends, if any, as may be declared on the GKP Restricted Shares from time to time, and (iii) the rights available to all holders of Shares upon any merger, consolidation, reorganization, liquidation or dissolution, stock split-up, stock dividend or recapitalization undertaken by the Company; provided, however, that all of such rights shall be subject to the terms, provisions, conditions and restrictions set forth in this Amendment (including without limitation conditions under which all such rights shall be forfeited). Any cash dividends (or dividends paid in the form of property other than Shares) paid with respect to any GKP Restricted Shares shall be paid at the same time as those dividends are paid by the Company to other holders of Shares (reduced by any applicable federal, state, local or foreign withholding taxes thereon). Any Shares issued to GKP as a dividend with respect to GKP Restricted Shares shall have the same status and transfer restrictions and bear the same legend as the GKP Restricted Shares, and shall be held by the Company if the GKP Restricted Shares Stock that such dividend is attributed to are being so held, unless otherwise determined by the Board.

(b) Adjustments to Shares. If at any time there shall be any increase or decrease in the number of issued and outstanding Shares of the Company through the declaration of a stock dividend or through any recapitalization resulting in a stock split-up, combination or exchange of such Shares, then and in that event, the Board shall make any adjustments it deems fair and appropriate, in view of such change, in the number of GKP Restricted Shares then subject to this Amendment. If any such adjustment shall result in a fractional Share, such fraction shall be disregarded.

(c) No Restrictions on Certain Transactions. Notwithstanding any term or provision of this Amendment to the contrary, the existence of this Amendment, or of any outstanding GKP Restricted Shares awarded hereunder, shall not affect in any manner the right, power or authority of the Company to make, authorize or consummate: (i) any or all adjustments, recapitalizations, reorganizations or other changes in the Company’s capital structure or its business; (ii) any merger, consolidation or similar transaction by or of the Company; (iii) any offer, issue or sale by the Company of any capital stock of the Company, including any equity or debt securities, or preferred or preference stock that would rank prior to or on parity with the GKP Restricted Shares and/or that would include, have or possess other rights, benefits and/or preferences superior to those that the GKP Restricted Shares includes, has or possesses, or any warrants, options or rights with respect to any of the foregoing; (iv) the dissolution or liquidation of the Company; (v) any sale, transfer or assignment of all or any part of the stock, assets or business of the Company; (vi) any dividend or other distribution of cash, Shares or other property by the Company; or (vii) any other corporate transaction, act or proceeding (whether of a similar character or otherwise).

(d) Share Redemption Program. Non-Vested GKP Restricted Shares shall not be eligible for redemption by the Company under any circumstances unless approved by the Board. After the vesting of the GKP Restricted Shares, and only upon receiving a request from GKP and the consent of the Conflicts Committee, within 60 days of the request the Company will redeem, and GKP will transfer to the Company, 50% of such Vested GKP Restricted Shares, with the amount of the cash payment per Share determined based on the then most recent Board-approved net asset value of the Shares (which shall not be more than six months old). Any Vested GKP Restricted Shares that are not required to be redeemed in accordance with the preceding sentence are referred to herein as the “Retained Vested GKP Restricted Shares.” Retained Vested GKP Restricted Shares shall not be eligible for redemption under the Company’s share redemption program (the “SRP”) unless the Company has satisfied all outstanding redemption requests from other stockholders, provided that this restriction may be waived in certain situations, such as upon a change of control of the Company, as determined by the Conflicts Committee of the Board.

(e) Share Transfer Restrictions. The Released Shares received by the parties to this Amendment (or transferred to Recipient’s or its affiliates’ current or former employees, or certain designated employees of Pacific Oak, as described below (collectively, “Affiliated Transferees”)) shall be subject to the transfer restrictions described herein. Subject to Section 4 hereof with respect the Retained Vested Shares, such shares shall be eligible for redemption under the Company’s SRP or tendering in third-party tender offers. However, the Released Shares have not been registered under federal or state securities laws and may not be offered or sold, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of such laws. For 12 months from the date of this Amendment, transfers of Released Shares outside of the SRP or third-party tender offers will only be permitted on a case-by-case basis if approved by the Company and such transfers must comply with applicable laws. The foregoing transfer restrictions shall not apply to transfers from Recipient to Affiliated Transferees if Recipient has received advice from its counsel that such transfers comply with all federal or state securities laws. Any attempt to transfer securities without compliance with this paragraph shall be voidable at the option of the Company.

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11. Transferability.

(a) Except for Estate Planning or community property division or unless otherwise determined by the Board, the GKP Restricted Shares are not transferable unless and until they become Vested GKP Restricted Shares in accordance with this Amendment. The terms of this Amendment shall be binding upon the successors and assigns of GKP. Any attempt to effect a Transfer (as defined below) of any GKP Restricted Shares prior to the date on which the GKP Restricted Shares become Vested GKP Restricted Shares shall be void ab initio. For purposes of this Amendment, “Transfer” shall mean any sale, transfer, encumbrance, gift, donation, assignment, pledge, hypothecation, or other disposition, whether similar or dissimilar to those previously enumerated, whether voluntary or involuntary, and including, but not limited to, any disposition by operation of law, by court order, by judicial process, or by foreclosure, levy or attachment.

(b) Unless otherwise consented to in writing by the Company, in its sole discretion, this Amendment (and GKP’s rights hereunder) may not be assigned, and the obligations of GKP hereunder may not be delegated, in whole or in part. The rights and obligations created hereunder shall be binding on GKP and its heirs and legal representatives and on the successors and assigns of the Company.

12. Responsibilities for Tax Consequences. The tax consequences to GKP and the Recipient (including without limitation federal, state, local and foreign income tax consequences) with respect to the GKP Restricted Shares (including without limitation the grant, vesting and/or forfeiture thereof) and this Amendment are the sole responsibility of GKP and the Recipient, respectively.

13. Amendment. This Amendment may be amended only with the written consent of the Company, the Recipient and GKP, except that amendments to Sections 1-4 do not require the consent of GKP and amendments to Sections 5-11 do not require the consent of the Recipient.

14. Complete Agreement. This Amendment (together with the Agreement and those agreements and documents expressly referred to herein, for the purposes referred to herein) embody the complete and entire agreement and understanding between the parties with respect to the subject matter hereof, and supersede any and all prior promises, assurances, commitments, agreements, undertakings or representations, whether oral, written, electronic or otherwise, and whether express or implied, which may relate to the subject matter hereof in any way. No promises, assurances, commitments, agreements, undertakings or representations, whether oral, written, electronic or otherwise, and whether express or implied, with respect to the subject matter hereof, have been made by any party which are not set forth expressly in the Agreement or this Amendment.

15. Miscellaneous.

(a) Severability. If any term or provision of this Amendment is or becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction or under any applicable law, rule or regulation, then such provision shall be construed or deemed amended to conform to applicable law (or if such provision cannot be so construed or deemed amended without

materially altering the purpose or intent of this Agreement and the transfer of GKP Restricted Shares hereunder, such provision shall be stricken as to such jurisdiction and the remainder of this Agreement and the award hereunder shall remain in full force and effect).

(b) Law Governing. This Amendment shall be governed by and construed and enforced in accordance with the internal laws of the State of Maryland (without reference to the conflict of laws rules or principles thereof).

(c) Interpretation. GKP accepts the GKP Restricted Shares subject to all of the terms, provisions and restrictions of this Agreement. The undersigned GKP hereby accepts as binding, conclusive and final all decisions or interpretations of the Company upon any questions arising under this Agreement.

(d) Headings. Section, paragraph and other headings and captions are provided solely as a convenience to facilitate reference. Such headings and captions shall not be deemed in any way material or relevant to the construction, meaning or interpretation of this Amendment or any term or provision hereof.

(e) Notices.. Any notice under this Amendment shall be in writing and shall be deemed to have been duly given when delivered by hand or by overnight mail or other overnight delivery service to the addresses set forth herein:

To the Company or the Board:

Pacific Oak Strategic Opportunity REIT, Inc.

11766 Wilshire Blvd., Suite 1670

Los Angeles, California 90025

To the Recipient:

KBS Capital Advisors LLC

800 Newport Center Drive, Suite 700

Newport Beach, California 92660

To GKP:

GKP Holding LLC

11766 Wilshire Blvd., Suite 1670

Los Angeles, California 90025

Either party may at any time give notice in writing to the other party of a change in its address for the purposes of this Section 15(e).

(f) Non-Waiver of Breach. The waiver by any party hereto of the other party’s prompt and complete performance, or breach or violation, of any term or provision of this Amendment shall be effected solely in a writing signed by such party, and shall not operate nor be construed as a waiver of any subsequent breach or violation, and the waiver by any party

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hereto to exercise any right or remedy which he or it may possess shall not operate nor be construed as the waiver of such right or remedy by such party, or as a bar to the exercise of such right or remedy by such party, upon the occurrence of any subsequent breach or violation.

(g) Counterparts. This Amendment may be executed in multiple separate counterparts, each of which shall be an original, and all of which together shall constitute one and the same agreement.

(h) Arbitration. To the extent that a dispute arises between the parties under this Amendment, the parties agree to attempt to settle such dispute through non-binding mediation to be held for a maximum of one day administered by the Judicial Arbiter Group (“JAG”), before a mutually agreed representative of JAG, in accordance with its commercial mediation rules then in effect. If such dispute cannot be resolved through mediation, it shall be resolved by binding arbitration before a panel of three arbitrators of JAG (selected by the JAG mediator) under the commercial arbitration rules then in effect. Each party shall bear its own legal, accounting and other similar fees incurred in connection with such arbitration; provided that (a) the losing party shall bear the costs of such arbitration and (b) the arbitrators shall award legal fees to the prevailing party in such dispute. Such arbitration and determination shall be final and binding on the parties and judgment may be entered upon such determination in any court having jurisdiction thereof (and such judgment enforced, if necessary, through judicial proceedings). It is understood and agreed that the arbitrators shall be specifically empowered to designate and award any remedy available at law or in equity, including specific performance. The parties agree that any such mediation or arbitration shall be conducted in Los Angeles, California.

(i) Termination of this Agreement. Upon vesting of all Non-Vested GKP Restricted Shares, this Amendment shall terminate, except any provisions under Section 10(d).

IN WITNESS WHEREOF, the parties hereto, intending to be legally bound, have executed this Amendment as of the date first written above.


PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.

By:	/s/ Keith D. Hall
	Keith D. Hall, Chief Executive Officer

KBS CAPITAL ADVISORS LLC

By:	PBren Investments, L.P., a Manager

	By:	PBren Investments, LLC, as general partner

		By:	PBCS Management, LLC, a Manager

		By:	/s/ Charles J. Schreiber, Jr.
			Charles J. Schreiber, Jr., Manager

By:	Schreiber Real Estate Investments, L.P., a Manager

	By:	Schreiber Investments, LLC, as general partner

		By:	PBCS Management, LLC, a Manager

		By:	/s/ Charles J. Schreiber, Jr.
			Charles J. Schreiber, Jr., Manager

GKP HOLDING LLC

By:	/s/ Peter McMillan
	Peter McMillan, Manager

By:	/s/ Keith Hall
	Keith Hall, Manager

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EX-99.2 3 d216519dex992.htm EX-99.2 EX-99.2

Exhibit 2

UNVESTED SHARE TRANSFER AGREEMENT

THIS UNVESTED SHARE TRANSFER AGREEMENT (the “Agreement”) is made as of September 1, 2021 (the “Effective Date”), by and between KBS Capital Advisors LLC, a Delaware limited liability company (the “Transferor” or “KBS Capital”), and GKP Holding LLC, a Delaware limited liability company (the “Transferee” or “GKP”). Transferor and Transferee are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”

RECITALS

A. WHEREAS, Transferor owns 2,254,289 unvested shares (the “Unvested Shares” or “Shares”) of Pacific Oak Strategic Opportunity REIT, Inc. (“Pacific Oak SOR”); and

B. WHEREAS, Transferor desires to transfer all of the Shares to Transferee (as noted in Schedule 1).

AGREEMENT

NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein, and other valuable consideration, the receipt and sufficiency of which the Parties hereby acknowledge, the Parties hereby agree as follows:

1. Transfer of the Shares. Upon the terms and subject to the conditions set forth herein and effective immediately upon the execution and delivery of this Agreement by the Parties, Transferor hereby irrevocably conveys, assigns, transfers and delivers to Transferee, and Transferee hereby assumes, all right, title and interest in and to the Shares, free and clear of all liens, encumbrances, security interests, pledges, options, claims and rights of others of any nature whatsoever in order to effectuate conclusion by Transferee of any and all the interest and/or rights whatsoever from and/or in KBS Holdings LLC (“KBS Holdings”), KBS Realty Advisors, LLC (“KBS Realty”), KBS Capital, KBS Capital Markets Group LLC (“KBS CMG”), KBSDirect LLC (“KBSDirect”), and/or any member or related entity of KBS (“KBS” collectively means KBS Holdings, KBS Realty, KBS Capital, KBS CMG, KBSDirect, Schreiber Real Estate Investments, L.P., PBren Investments, L.P., and the Estate of Peter M. Bren).

2. No Ownership and Interest In KBS: As of the Effective Date, GKP owns no interest in nor has any ownership rights to KBS.

3. Transferor’s Representations and Warranties. Transferor hereby represents and warrants to Transferee: Transferor is the sole owner beneficially and of record of the Shares, free and clear of all liens encumbrances, security interests, pledges, options, claims and rights of others of any nature whatsoever.

4. Costs. Each Party shall be responsible for its respective costs and expenses (including without limitation legal fees) incurred in connection with the transactions contemplated by this Agreement.

5. Further Assurance. At any time and from time to time after the date hereof, Transferor and Transferee shall promptly execute and deliver all such further agreements, certificates, instruments and documents, or perform such further actions, as may be requested, in order to fully consummate the transactions contemplated hereby regarding the conveyance, assignments, transfer and delivery of the Shares and carry out the purposes and intent of this Agreement.

6. Entire Agreement. This Agreement constitutes the entire agreement among the Parties with respect to the subject matter hereof and supersede all other prior and contemporaneous agreements and undertakings among the Parties (whether oral or written) with respect to its subject matter. No supplement, modification or waiver of this Agreement or any provisions hereof shall be binding unless executed in writing by the Parties to be bound thereby.

7. Parties in Interest. This Agreement is binding upon, inures to the benefit of, and is enforceable by the Parties, and their respective heirs, executors, personal representatives, successors and assigns. No Party hereto may assign its or his rights or delegate its or his obligations hereunder without the written consent of the other Party.

8. Headings. The Section headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

9. Severability. Any provision of this Agreement which is invalid, illegal, or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective only to the extent of such invalidity, illegality or unenforceability, without in any way affecting the remaining provisions hereof in such jurisdiction or rendering that or any other provision of this Agreement invalid, illegal or unenforceable in any other jurisdiction.

10. Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Delaware without regard to the principles of conflicts of law.

11. Waiver. No delay on the part of any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of any party of any right, power or privilege hereunder, or any single or partial exercise of any right, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder.

12. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same document. Confirmation of execution by electronic transmission of a facsimile signature page shall be binding upon any party so confirming.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

TRANSFEROR:

KBS CAPITAL ADVISORS LLC,

a Delaware limited liability company

/s/ Charles J. Schreiber, Jr.

Charles J. Schreiber, Jr., Chief Executive Officer

Signatures Continue on Next Page

TRANSFEREE:

GKP HOLDING LLC,

a Delaware limited liability company

/s/ Peter McMillan

Peter McMillan, Manager

EX-99.3 4 d216519dex993.htm EX-99.3 EX-99.3

Exhibit 3

PARTICIPANT SHARE TRANSFER AGREEMENT

THIS PARTICIPANT SHARE TRANSFER AGREEMENT (“Agreement”) is made as of September 2, 2021 (the “Effective Date”), by and between KBS Capital Advisors LLC, a Delaware limited liability company (the “Transferor” or “KBS Capital”), and GKP Holding LLC, a Delaware limited liability company (“GKP”) for the benefit of the participants listed on Schedule 1 hereto (the “Transferees”). Transferor and GKP are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”

RECITALS

A. WHEREAS, Transferor owns certain shares (the “Shares”) of Pacific Oak Strategic Opportunity REIT, Inc. (“Pacific Oak SOR”); and

B. WHEREAS, Transferor desires to transfer the Shares enumerated in Schedule 1 to the Transferees, except to the extent the restricted stock payments are made in cash pursuant to Section 1 of this Agreement.

AGREEMENT

1. Transfer of the Shares. KBS Capital will distribute specified restricted stock payments to certain particular current or former employees at Pacific Oak Capital Advisors LLC, KBS Realty Advisors, LLC and/or KBS Capital for their profit participation interest in certain Shares of Pacific Oak SOR stock listed on Schedule 1 related to the incentive fee earned by KBS Capital upon termination of the KBS Capital advisory agreement with the then KBS SOR later renamed Pacific Oak SOR (the “Restricted Stock Payments”). Upon the terms and subject to the conditions set forth in this Agreement and upon the execution and delivery of this Agreement by the Parties, Transferor hereby agrees to irrevocably convey, assign, transfer and deliver to the Transferees, all right, title and interest in and to the Shares, free and clear of all liens, encumbrances, security interests, pledges, options, claims and rights of others of any nature whatsoever, except to the extent the Restricted Stock Payments are made in cash pursuant to this Section 1. At each Transferee’s election, and if no election is received the default payment will be fifty percent (50%) cash and fifty percent (50%) stock, KBS Capital shall pay up to fifty percent (50%) of the Shares allocated to each Transferee as noted in Schedule 1 in cash rather than stock (subsequent to the receipt of such cash by KBS Capital from Pacific Oak SOR). Additionally, for two of the Transferees listed in Schedule 1, KBS Capital shall pay one hundred percent (100%) of the Shares allocated to such Transferees in cash. The cash paid to the Transferees will be determined based on the most recent estimated value per share of Pacific Oak SOR of $9.68. It is expected that after the cash elections, KBS Capital will transfer 513,467 Shares to the Transferees. None of the Shares transferred under this Agreement will be received by Chuck Schreiber, Peter McMillan and/or Keith Hall.

2. Transferor’s Representations and Warranties. Transferor hereby represents and warrants that Transferor is the sole owner of record of the Shares, free and clear of all liens encumbrances, security

interests, pledges, options, claims and rights of others of any nature whatsoever. The Parties further represent and warrant that GKP is not and has never been the owner of record of the Shares of the Transferees.

3. Costs. Each Party shall be responsible for its respective costs and expenses (including without limitation legal fees) incurred in connection with the transactions contemplated by this Agreement.

4. Further Assurance. At any time and from time to time after the date hereof, Transferor shall promptly execute and deliver all such further agreements, certificates, instruments and documents, or perform such further actions, as may be requested, in order to fully consummate the transactions contemplated hereby regarding the conveyance, assignments, transfer and delivery of the Shares and carry out the purposes and intent of this Agreement.

5. Entire Agreement. This Agreement constitutes the entire agreement among the Parties with respect to the subject matter hereof and supersede all other prior and contemporaneous agreements and undertakings among the Parties (whether oral or written) with respect to its subject matter. No supplement, modification or waiver of this Agreement or any provisions hereof shall be binding unless executed in writing by the Parties to be bound thereby.

6. Parties in Interest. This Agreement is binding upon, inures to the benefit of, and is enforceable by the Parties, and their respective heirs, executors, personal representatives, successors and assigns. No Party hereto may assign its or his rights or delegate its or his obligations hereunder without the written consent of the other Party.

7. Headings. The Section headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

8. Severability. Any provision of this Agreement which is invalid, illegal, or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective only to the extent of such invalidity, illegality or unenforceability, without in any way affecting the remaining provisions hereof in such jurisdiction or rendering that or any other provision of this Agreement invalid, illegal or unenforceable in any other jurisdiction.

9. Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Delaware without regard to the principles of conflicts of law.

10. Waiver. No delay on the part of any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of any party of any right, power or privilege hereunder, or any single or partial exercise of any right, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder.

11. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same document. Confirmation of execution by electronic transmission of a facsimile signature page shall be binding upon any party so confirming.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

TRANSFEROR:

KBS CAPITAL ADVISORS LLC,

a Delaware limited liability company

/s/ Charles J. Schreiber, Jr.

Charles J. Schreiber, Jr., Chief Executive Officer

ACCEPTED AND AGREED:

GKP HOLDING LLC,

a Delaware limited liability company

/s/ Peter McMillan

Peter McMillan, Manager