1
Exhibit 11
October 1, 1995
Tishman Speyer Properties, L.P.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Xxxxx Xxxxxxxxxxx
Room 5600
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
Whitehall Street Real Estate Limited Partnership V, Xxxxxxx,
Xxxxx & Co., Xxxxxxx Sachs Mortgage Company (collectively, the "Whitehall
Investors"), Tishman Speyer Properties, L.P. ("Tishman Speyer") and Xxxxx
Xxxxxxxxxxx ("Xxxxxxxxxxx") intend to submit a transaction proposal to the
Board of Directors of Rockefeller Center Properties, Inc. ("RCPI")
substantially on the terms set forth in the letter attached as Annex 1
hereto (the "Proposal") and in connection therewith the parties hereto wish
to set forth their understandings and agreements relating to their
respective commitments to participate in the transaction described in the
Proposal.
Accordingly, the parties hereto hereby agree as follows:
1. Each of the undersigned hereby consents to the delivery
of the Proposal to the Board of Directors of RCPI and commits to
participate in the Proposal on the terms and subject to the conditions set
forth therein and in the description of the Transaction Structure attached
as Annex 2 hereto (including Exhibit A thereto) (the "Transaction
Summary"); provided that if prior to October 6, 1995 Rockefeller shall not
have arranged an investor group reasonably satisfactory to the Whitehall
Investors to fund a portion of his commitment, then he may terminate his
commitment hereunder.
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2. The Whitehall Investors and Tishman Speyer hereby commit
that if Rockefeller terminates his commitment in accordance with the
proviso of paragraph 1 above, then the Whitehall Investors and Tishman
Speyer shall participate in the Proposal on the terms and subject to the
conditions set forth therein and in the description of the Alternative
Transaction Structure attached as Annex 3 hereto (including Exhibit A
thereto) (the "Alternative Transaction Summary").
3. In the case of paragraph 2, the Whitehall Investors may
in their sole discretion modify the capitalization of the entity to be
formed described in the Alternative Transaction Summary (provided that any
such modification shall not disproportionately adversely affect Tishman
Speyer relative to the Whitehall Investors), in which case each of Tishman
Speyer may terminate its commitment hereunder.
4. Subject to the foregoing, if the Board of RCPI elects to
pursue the Proposal, the parties hereto shall negotiate in good faith to
expeditiously enter into definitive agreements consistent with the terms
and conditions set forth in the Proposal and the Transaction Summary or the
Alternative Transaction Summary, as applicable.
5. This letter and the parties' respective obligations
hereunder shall not be assignable without the consent of each of the
parties hereto, and any attempted assignment shall be void.
6. This letter may be executed in one or more counterparts,
each of which shall be an original and all of which, when taken together,
shall constitute one and the same instrument.
7. This letter is intended solely for the benefit of the
parties hereto and is not intended to confer any benefits upon or create
any rights in favor of, any person other than the parties hereto.
8. This letter shall be governed by and construed in
accordance with the laws of the State of New York (other than its rules of
conflicts of laws to the extent that the application of the laws of another
jurisdiction would be required thereby).
9. This letter shall be effective as of the opening of
business in New York City on October 2, 1995.
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If the foregoing correctly sets forth the agreement reached
among the parties hereto with respect to the subject matter hereof, kindly
execute this letter in the space provided below, at which time this letter
shall serve as a binding and enforceable agreement among the parties
hereto.
Very truly yours,
WHITEHALL STREET REAL ESTATE LIMITED
PARTNERSHIP V
XXXXXXX, XXXXX & CO.
XXXXXXX SACHS MORTGAGE
COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
Name:
Title:
ACCEPTED AND
AGREED TO:
TISHMAN SPEYER PROPERTIES, L.P.
By: Tishman Speyer Properties, Inc.
its general partner
By: /s/ Xxxxx X. Xxxxxx
Name:
Title:
/s/ Xxxxx Xxxxxxxxxxx
Xxxxx Xxxxxxxxxxx
*By: /s/ Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxx
Attorney-in-Fact
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Annex 1
October 1, 1995
Board of Directors
Rockefeller Center Properties, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attention: Xx. Xxxxx Xxxxxxxx
Chairman
Gentlemen:
On behalf of an entity (the "Acquiror") to be formed and
capitalized by Whitehall Street Real Estate Limited Partnership V
("Whitehall"), Xxxxxxx, Sachs & Co., Xxxxxxx Xxxxx Mortgage Company
("GSMC"), Tishman Speyer Properties, L.P. and Xxxxx Xxxxxxxxxxx (together
with their respective designated affiliates, the "Investor Group"), we are
pleased to submit a proposal for the acquisition of Rockefeller Center
Properties, Inc. ("RCPI") pursuant to a merger between the Acquiror and
RCPI in which holders of all outstanding shares of Common Stock of RCPI
will receive $7.75 per share in cash in exchange for their shares (the
"Merger").
The Merger Agreement referred to below will not contain any
financing condition. The Merger and this Proposal are, however,
conditioned upon (i) acquisition by RCPI of the Rockefeller Center property
and related assets (the "Property") pursuant to a confirmed plan for the
owners of the Property (the "Plan") under chapter 11 of the Bankruptcy
Code, which Plan, as well as the order confirming the Plan, shall be
satisfactory to the Investor Group in all respects, (ii) RCPI's entering
into a definitive merger agreement on acceptable terms (the "Merger
Agreement"), (iii) RCPI shareholder approval of the Merger and (iv) there
having occurred no material adverse change in the financial condition of
RCPI or the Property (including any issuance of additional stock in RCPI or
agreement to reduce the rent under any material lease of space in the
Property).
The Merger Agreement will include customary and appropriate
representations and warranties, covenants, exclusivity and confidentiality
provisions, a break-up fee of $7,500,000 and will provide for reimbursement
of reasonable expenses
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and other typical miscellaneous provisions. This proposal is conditioned
upon RCPI's not filing any material pleadings and other documents ("RCPI
Pleadings") relating to the chapter 11 proceedings involving Rockefeller
Center Properties (the "Proceedings") or taking any other action that is
material (as determined by the Investor Group) in any way relating to the
Proceedings not acceptable to the Investor Group, and the Merger Agreement
will expressly provide for such condition.
Upon execution of the Merger Agreement, GSMC will lend RCPI up
to an additional $33 million under the Loan Agreement, dated as of December
18, 1994, between RCPI and GSMC, and RCPI will prepay any borrowing it has
made under the Investment Agreement, dated as of August 18, 1995, between
RCPI and Xxxx/Xxxxxxx Xxxxx Real Estate Opportunity Partners Limited
Partnership III (the "Investment Agreement") and thereby terminate the
Investment Agreement.
Our proposal is also subject to RCPI's having, immediately
prior to consummation of this Merger, (i) no more than 38,260,704 shares of
common stock outstanding, (ii) no outstanding warrants or rights to
purchase capital stock or securities convertible into or exchangeable for
capital stock or stock appreciation rights (collectively, "Stock Rights"),
other than those owned by Whitehall and (iii) only those existing
liabilities as are set forth on Schedule A to this letter. To the extent
RCPI incurs liabilities not set forth on Schedule A or has issued
additional shares of common stock or Stock Rights, the Investor Group may
elect to proceed with the transaction with a corresponding reduction to the
purchase price.
We are in a position to proceed on an expedited basis. Our
proposal will remain open until the close of business on October 6, 1995;
provided that we reserve the right to withdraw our proposal prior to such
date if (i) RCPI enters into any agreement or agreement in principle with
the owners of the Property or Rockefeller Group, Inc. with respect to
either (x) a plan of liquidation or reorganization for the owners of the
Property or (y) a plan or proposal for the transfer of the Property in
satisfaction of the existing mortgage thereon in lieu of such a plan or
(ii) RCPI proposes any such plan either on its own or jointly with any
third party, in each case, if such agreement, plan or proposal is not
acceptable to the Investor Group.
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We would welcome the opportunity to meet with you or your
advisors to answer any questions concerning the proposal we have outlined
in this letter and to negotiate the Merger Agreement, which we believe can
be entered into by October 6.
Sincerely,
Xxxxxx X. Xxxxxxx
(on behalf of Xxxxxxx, Sachs & Co.,
Xxxxxxx Xxxxx Mortgage Company
and Whitehall Street Real Estate Limited Partnership V)
Xxxxx X. Xxxxxx
(on behalf of Tishman Speyer Properties, L.P.)
Xxxxx Xxxxxxxxxxx*
*By: ________________________________
Xxxxx X. Xxxxxx
Attorney-in-Fact
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Schedule A
Company Liabilities estimated
as of December 31, 1995(1)
Outstanding Debt:
Current Coupon Convertible Debentures (1) $213,170,000
Zero Coupon Convertible Debentures 360,283,107
Floating Rate Notes (1)(2) 150,000,000
14% Debentures(1) 75,000,000
Total Outstanding Debt $798,453,107
Other Liabilities:
Swaps (estimated) 10,000,000
Transaction Costs (3) 8,000,000
Other General and Administrative Liabilities (see
Attachment 1) 3,497,543
Maximum Trade Payables 15,000,000
Xxxx Breakup Fee and Related Expenses 11,575,000
Total Other Liabilities $48,072,543
Total Liabilities $846,525,650
Minimum Net Cash $12,000,000
Total Net Liabilities $834,525,650
(1) Assumes interest on obligations payable currently is paid.
(2) Assumes GSMC lends $33.7 million under the terms of the GSMC Loan
Agreement.
(3) Includes only professional fees to PaineWebber, Weil, Gotshal &
Xxxxxx, Xxxxxxxx & Sterling, and expense liabilities payable to Xxxxxxx,
Sachs & Co. under its existing agreements.
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Attachment 1
Other Liabilities
(Amounts estimated as of December 31, 1995)
All litigation listed on Annex A hereto and any expenses incurred by the
Company in connection with these suits and any indemnity payments due from
the Company to the officers and directors in connection with such suits
(based on the assumption that collectively such litigation would not have a
material adverse effect on the Company).
Audit Fees $ 150,000
Property Appraisal 150,000
Investor Relations Consulting 150,000
Consulting Fees 20,000
Office space lease (future cash rent to the end of the lease) 770,000
Tax Return Preparation Fees 10,000
Directors' Fees and Expenses 5,000
Property Inspection 7,500
Registrar and Transfer Agent Fees 35,000
Dividend Reinvestment Plan 2,000
Investor Communications 50,000
Taxes 2,500
Data Processing 5,000
Travel and Reimbursable Expenses 3,000
Telephone Service 3,000
Miscellaneous 127,000
Office Equipment Leases 26,100
XXXXX Filings -- Merrill Corporation 25,000
Payroll -- Salaries 13,245
Payroll -- Taxes 11,054
Payroll -- Incentive Savings Plan 2,716
Contractual Severance Pay 1,267,000
Contractual Severance Benefits 152,429
Retirement Plan 510,000
Total $3,497,543
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Annex A to Attachment 1
General
On January 23, 1995 Bear, Xxxxxxx & Co., Inc. and Xxxxxxxxx,
Lufkin & Xxxxxxxx Securities Corporation commenced an action against the
Company in the Supreme Court of New York, County of New York. The
plaintiffs allege that the Company breached a contract relating to the
plaintiffs' provision of investment banking services to the Company. The
plaintiffs seek $5,062,500 in damages, plus costs, attorneys' fees and
interest.
On May 24, 1995 Xxxxx Xxxx commenced an action encaptioned Krim
x. Xxxxxxxxxxx Center Properties, Inc. and Xxxxx X. Xxxxxxxx. On June 7,
Xxxxx Xxxxxx and Xxxxxx Xxxxxxx commenced an action encaptioned Knight, et
al. x. Xxxxxxxxxxx Center Properties, Inc. and Xxxxx X. Xxxxxxxx. Both
actions were filed in the United States District Court for the Southern
District of New York and purport to be brought on behalf of a class of
plaintiffs comprised of all persons who purchased the Company's common
stock between March 20, 1995 and May 10, 1995. The complaints allege that
the Company and Xx. Xxxxxxxx violated the federal securities laws by their
purported failure to disclose prior to May 11, 1995 that the Borrower would
file for bankruptcy protection. The cases have been consolidated and the
plaintiffs are seeking damages in such amount as may be proved at trial,
plus costs, attorneys' fees and interest.
On July 6, 1995 Charal Investment Company, Inc. commenced a
derivative action against certain of the Company's present and former
directors (the "Defendant Directors") in the Court of Chancery of the State
of Delaware in and for New Castle County. The Company was named as a
nominal defendant. The plaintiff alleges that the Defendant Directors
breached their fiduciary duty by: (1) using commercial paper proceeds to
repurchase Convertible Debentures; (2) entering into interest rate swaps;
and (3) making capital distributions to stockholders. The plaintiffs seek
such equitable or injunctive relief as may be appropriate and to have the
Defendant Directors pay the Company damages to the extent the Company was
harmed as a result of the Defendant Directors' breach of fiduciary duty,
plus costs, attorneys' fees and interest.
On July 31, 1995 L.L. Capital Partners, L.P. commenced an
action against the Company in the United States Court in the Southern
District of New York. The plaintiff alleges that, prior to December 1993,
the Company failed to disclose its purported belief that the Rockefeller
family and the Borrower's corporate parent would cease to fund the
Borrower's cash flow shortfalls and that, as a result of such non-
disclosure, plaintiffs were induced to purchase 700,000 shares of the
Company's common stock at $7.00 per share in December, 1993. The
plaintiffs seek rescission, or, in the alternative, monetary damages
(including punitive damages), plus interest.
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DAMAGES ALLEGED
1. Xxxx Xxxxxxx v. RCPI, et al., No. 132218/94 $1,000,000.00
2. Xxxxxxxxx Xxxxxxxxx v. RCPI, et al., No. 100082/93 25,000.00*
3. Xxxxxx Xxxxxx Xxxxxx and
Xxxx Xxxxxxx v. RCPI, et al, 122720/94 7,750,000.00
4. Xxxxxxx Xxxxxx v. RCPI, et al., 4725/95 2,000,000.00
5. Xxxxxxx Xxxxxxxxx v. RCPI, et al., No. 128649/94 20,000,000.00
6. Xxxxxx Xxxxxxx v. RCPI, et al., No. 132388/94 750,000.00
7. Xxxxxxxx Xxxxxxxx v. RCPI, et al., No. 128826/94 1,000,000.00
8. Xxxxxxxx Xxxxxxxx v. RCPI, et al., No. 113506/94 1,000,000.00
9. Xxxxxxx Xxxxx v. RCPI, et al., No. 21035/94 1,000,000.00
10. Xxxxxx X. Xxxxxxxx v. RCPI, et al., 13598/93 2,000,000.00
11. Xxxxxxxxx X. Xxxxxx, et al. v. RCPI, et al.,
No. 117397/94 5,000,000.00
12. Xxxxx Xxxxx, Xx. v. RCPI, et al., No. 3426/94 20,000,000.00
13. Xxxx Xxxxxxxxx, et al. v. RCPI, et al.,
No. 93-032229 5,750,000.00
14. Xxxxxxx Xxxxxxxxx v. RCPI, et al., No. 23684/93 1,000,000.00
15. Xxxxxxx X. Xxxxx v. RCPI, et al., No. 26500/94 1,000,000.00
16. Xxxxxxx Xxxxxxxx v. RCPI, et al., No. 30435/94 500,000.00
17. Reliance Insurance Company v. RCPI et al.,
No. 94-133892 186,000.00
*Plaintiff alleges at least $25,000, the full amount to be proved at trial.
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Annex 2
Transaction Structure
Initial Investors
GS/Whitehall: $220 million (50%)
Xxxxx Xxxxxxxxxxx: $200 million (approx. 45%)
(including additional investors reasonably acceptable to
Whitehall Investors)
Tishman Speyer: $20 million (approx. 5%)
Total Equity: $440 million
Capitalization (in millions)
New financing(a) $ 430
Zeros 360
14% 75
Total Debt 865
Equity 440
Total $ 1,305
____________
(a) If new financing is not available on favorable terms, certain
existing financing would remain in place.
Management Arrangements
o See Exhibit A
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Exhibit A
Term Sheet
Shareholder Arrangements
Structure: Form of company to be agreed upon among
Whitehall and its affiliates (the "Whitehall
Investors") and the other investors (the
"Other Investors" and together with the
Whitehall Investors, the "Investors")
Management:
Managing Agent: Tishman Speyer Properties, L.P. to act as
managing agent ("Managing Agent") with
responsibility for day-to-day management of
the Property, subject to authority of the
Board. Managing Agent to be subject to
Management Agreement described below.
Initial Officers: Chairman: Xxxxx Xxxxxxxxxxx (if he elects to
serve in such capacity) or an individual
designated by Whitehall Investors (if not
Xxxxx Xxxxxxxxxxx)
Vice Chairman: Individual designated by
Whitehall Investors (if Xxxxx Xxxxxxxxxxx
is Chairman) or by Other Investors (if
Chairman designated by Whitehall Investors)
President and CEO: Xxxxx X. Xxxxxx
Board: Comprised of 4 members designated by
Whitehall Investors (the "Class A Directors")
and 4 members designated by Other Investors
(the "Class B Directors"); provided that in
lieu of designating 4 members Whitehall
Investors may designate fewer than 4 members
having the right to 4 votes on the Board.
Supermajority Matters: Following matters to require affirmative vote
of 75% of each of the Class A and Class B
Directors:
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(i) merger or consolidation of the
Company with or into any other
entity;
(ii) liquidation or dissolution of
the Company, except as required
by applicable law;
(iii) approval of annual budget;
(iv) engaging in new lines of
business or material deviations
therefrom;
(v) purchases of (x) any additional
properties or (y) any other
assets in excess of agreed upon
threshold;
(vi) declaration or payment of
dividends or other
distributions;
(vii) incurrence, including
refinancing, of indebtedness in
excess of agreed upon thresholds
(other than the financing
contemplated to be outstanding
at the closing of the
transactions);
(viii) entering into any transaction
with any Affiliate (it being
understood that (A) absent
special circumstances and
provided that Xxxxxxx, Xxxxx &
Co. or its affiliate is an
equity owner of RCPI, Xxxxxxx,
Sachs & Co. shall be the
Company's investment banking
firm, on customary terms as
approved by the Board and
(B) Tishman Speyer shall provide
cleaning and other property
related services on customary
terms as approved by the Board);
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(ix) capital expenditures other than
as set forth in the annual
budget approved in accordance
with clause (iii) above;
(x) commencement or settlement of
material litigation;
(xi) designation and removal of
executive officers;
(xii) issuance or sale of any equity
interests in the Company;
(xiii) any public offering of equity
interests in the Company;
(xiv) any adoption or modification of
significant accounting policies
or practices and appointment of
independent auditors; and
(xv) entering into space leases
relating to (x) space in excess
of 100,000 square feet,
(y) Radio City Music Hall or
(z) the ice rink, or space
leases not consistent with
annual budget approved in
accordance with clause (iii).
Disposition of Property: No dispositions of all or any portion of the
Property except as follows:
A. with the consent of 75% of each
of the Class A and Class B
Directors prior to third
anniversary;
B. with the consent of 50% of the
Board from and after the fifth
anniversary.
If a disposition of property is approved in
accordance with the foregoing, the Board
shall dispose of such property to the highest
unaffiliated bidder.
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Restrictions on Transfer: No transfers of interest in the Company prior
to third anniversary without the unanimous
consent of the Board, except:
A. any pledge to a bank or other
financial institution in
connection with securing a bona
fide loan to an Investor; or
B. any transfer by an Investor to
an affiliate of such Investor;
provided that (i) such affiliate
must execute an agreement by
which it shall become bound by
these arrangements and (ii) such
affiliate must be an affiliate
of an original Investor.
After third anniversary, any Investor may
transfer its interest in the Company provided
that it complies with the following
procedures:
A. Prior to offering such interest
to any third party, the selling
Investor shall first offer such
interest to the non-selling
Investors (pro rata based on
their respective interests in
the Company); provided that if
the selling Investor is one of
the Other Investors then such
selling Other Investor shall
first offer such interest to the
non-selling Other Investors and
shall thereafter offer any
interest not purchased by the
non-selling Other Investors to
the Whitehall Investors.
B. If the offeree Investors
collectively fail to purchase
such interests on the terms
offered, then the selling
Investor shall be permitted to
sell such interest to a third
party at a
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price no less than 95% of the
price offered to the Investors
and on other terms no more
favorable to such third party
then the terms offered to the
Investors; provided that such
third party shall be subject to
the approval of a majority of
the non-selling Investors (which
approval shall be granted in
each Investor's sole discretion
exercised in good faith).
If either the Whitehall Investors or the
Other Investors shall own in excess of 75% of
the equity of the Company or if any of the
Other Investors transfer their interests
(other than as permitted by clauses A. and B.
of the first paragraph of "Restrictions on
Transfer" above), all "Supermajority Matters"
shall thereafter require the approval of 75%
of the entire Board and Board representation
and voting shall be based on each Investor's
proportional equity interest.
Management Agreement: The Company and Tishman Speyer, as Managing
Agent, will enter into a Management Agreement
providing for a three-year term, with two
successive one-year renewal periods. Upon
the good faith determination of all of the
Investors (other than the Managing Agent)
with respect to the performance of the
Managing Agent (such determination to be made
without regard to cost considerations), the
Company may cause the Management Agreement
not to be renewed in accordance with the
foregoing. After the fifth anniversary, all
of the Investors must agree to any further
renewals of the Management Agreement. If all
of the Investors do not agree to renew the
Tishman Speyer Management Agreement and
cannot within a reasonable period agree on a
successor Managing Agent, then the Whitehall
Investors shall propose a list of 3 qualified
firms of reputable standing to serve as
Managing Agent
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and the Other Investors shall select the
Managing Agent from such list. Upon any non-
renewal of the Tishman Speyer Management
Agreement on or prior to the fifth
anniversary, Tishman Speyer will be entitled
to "put" its shares back to the Company at
fair market value (without minority
discount).
The Managing Agent will be paid a fee of 1.5%
of gross revenues plus one-half standard
commission override.
Break Up Fee: The break up fee will be allocated
proportionately based on the actual capital
ultimately committed by each investor.
Annex 3
Alternative Transaction Structure
Initial Investors:
GS/Whitehall: $420 million (95%)
(including additional investors selected by GS/Whitehall)
Tishman Speyer: $20 million (5%)
Total Equity: $440 million
Capitalization (in millions)
New financing(a) $ 430
Zeros 360
14% 75
Total Debt 865
Equity 440
Total $ 1,305
____________
(a) If new financing is not available on favorable terms, certain
existing financing would remain in place.
Management Arrangements
o See Exhibit A
1
Exhibit A
Term Sheet
Arrangements with Tishman Speyer
Management of Company:
President and CEO: Xxxxx X. Xxxxxx
Board: Comprised of 7 members designated by Whitehall
and 1 member designated by Tishman Speyer
(provided that in lieu of designating 7 members
Whitehall may designate fewer than 7 members
having the right to 7 votes on the Board)
Restrictions on No transfers by Tishman Speyer of its interest
Transfer of Tishman in the Company prior to fifth anniversary
Speyer Interests: without the unanimous consent of the Board,
except:
A. any pledge to a bank or other
financial institution in connection
with securing a bona fide loan to
Tishman Speyer; or
B. any transfer by Tishman Speyer to a
50% or more owned affiliate of
Tishman Speyer; provided that such
affiliate must execute an agreement
by which it shall become bound by
these arrangements.
After fifth anniversary, Tishman Speyer may
also transfer its entire interest in the
Company provided that it complies with the
following procedures and provided that upon any
such transfer, the Company shall have the right
to terminate the Management Agreement:
A. Prior to offering such interest to
any third party, Tishman Speyer
shall first offer such interest to
Whitehall.
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B. If Whitehall fails to purchase such
interests on the terms offered,
then Tishman Speyer shall be
permitted to sell such interest to
a third party at a price no less
than 95% of the price offered to
Whitehall and on other terms no
more favorable to such third party
than the terms offered to
Whitehall; provided that such third
party shall be subject to the
approval of Whitehall (which
approval may be granted in
Whitehall's sole discretion).
Managing Agent: Tishman Speyer Properties, L.P. to act as
managing agent ("Managing Agent") with
responsibility for day-to-day management of
Property, subject to authority of Board.
Managing Agent to be subject to Management
Agreement described below.
Management Agreement: The Company and Tishman Speyer, as Managing
Agent, will enter into a Management Agreement
providing for a three-year term, with two
successive one-year renewal periods. Upon the
good faith determination of Whitehall with
respect to the performance of the Managing
Agent (such determination to be made without
regard to cost considerations), the Company may
elect not to renew the Management Agreement.
The Managing Agent will be paid a fee of 1.5%
of gross revenues plus a one-half standard
commission override.
In addition, if prior to the third anniversary
the Company shall dispose of in excess of 50%
of the Property (based on square footage), the
Company shall pay to the Managing Agent a fee
to be agreed upon based on, among other things,
the date on which the properties are sold.
Tishman Speyer shall provide cleaning and other
property related services on customary terms as
approved by the Board.
3
Certain Put Rights; Upon any non-renewal by Whitehall of the
Tag Along/Drag Along Tishman Speyer Management Agreement on or prior
Rights: to the fifth anniversary, Tishman Speyer will
be entitled to "put" its shares back to the
Company at fair market value (without minority
discount).
In addition (unless prior to such date
Whitehall has elected not to renew the
Management Agreement), upon the fifth
anniversary and thereafter upon the expiration
of any renewal period, Tishman Speyer will be
entitled to "put" its shares back to the
Company at fair market value.
Tishman Speyer to have Tag Along (or Put)
Rights and Whitehall Investors to have Drag
Along Rights on disposition of entire interest
by Whitehall Investors.
Additional Funding If after the closing the Whitehall Investors
Rights: shall provide additional funding to the
Company, Tishman Speyer shall have the right to
participate in such funding on a pro rata
basis.
No Recourse: The Company shall not incur any indebtedness or
other obligations that are recourse to Tishman
Speyer.
Break Up Fee: The break up fee will be allocated $6.5 million
to the Whitehall Investors and $1.0 million to
Tishman Speyer.
