EXHIBIT R
Garrabant Stockholder Approval Agreement
STOCKHOLDER APPROVAL AGREEMENT (this "Agreement"), dated as of
March 8, 2000, among Travelers General Real Estate Mezzanine Investments II,
LLC, a Delaware limited liability company ("General XXXX XX"), Xxxx X.
Xxxxxxxxxx ("Xxxxxxxxxx") and GRG Investment Partnership LP, a Delaware limited
partnership ("GRG") (Xxxxxxxxxx and GRG are collectively referred to herein as
the "Stockholders" and individually referred to herein as a "Stockholder").
Preliminary Statement
A. Capital Trust, Inc., a Maryland corporation ("CT"), and
certain of its affiliates (the "CT Parties") and General XXXX XX and certain of
its Affiliates (the "CIG Parties"), propose to enter into a venture agreement,
dated as of the date hereof (the "Venture Agreement"), pursuant to which, among
other things, the CIG Parties and CT and the CT Parties will co-sponsor, commit
to invest capital in and manage real estate mezzanine investment opportunity
funds.
B. The Stockholders own in the aggregate 419,423 shares (the
"Owned Shares") of class A common stock, par value $.01 per share, of CT ("CT
Common Stock").
C. As a condition to the CIG Parties' willingness to enter
into the Venture Agreement, the CIG Parties have requested the Stockholders to
enter into this Agreement.
D. Capitalized terms used but not defined herein have the
meanings set forth in the Venture Agreement.
NOW, THEREFORE, to induce the CIG Parties to enter into, and
in consideration of the CIG Parties entering into, the Venture Agreement, and in
consideration of the premises and the representations, warranties and agreements
contained herein, the parties agree as follows:
1. Representations and Warranties of the Stockholders. The
Stockholders hereby, jointly and severally, represent and warrant to General
XXXX XX as follows:
(a) Authority. Each Stockholder has all requisite power and
authority to enter into this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this
Agreement by each Stockholder, and the consummation of the transactions
contemplated hereby, has been duly authorized by all necessary action
on the part of each Stockholder. This Agreement has been duly executed
and delivered by each Stockholder and, assuming the due authorization,
execution and delivery by General XXXX XX, constitutes a valid and
binding obligation of each Stockholder enforceable in accordance with
its terms, except to the extent enforceability may be limited by
bankruptcy, insolvency, moratorium or other similar laws affecting
creditors' rights generally or by general principles governing the
availability of equitable remedies. The execution and delivery of this
Agreement does not, and the consummation of the transactions
contemplated hereby and compliance with the terms hereof will not,
conflict with, or result in any violation of or default (with or
without notice or lapse of time or both) under any provision of any
trust agreement, partnership agreement, loan or credit agreement, note,
bond, mortgage, indenture, lease or other agreement, instrument,
permit, concession, franchise, license, judgment, order, notice,
decree, statute, law, ordinance, rule or regulation applicable to any
of the Stockholders or to any of the property or assets of any of the
Stockholders. Except for consents, approvals, authorizations and
filings as may be required under the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended (the "HSR Act"), and the
Securities Exchange Act of 1934, as amended ("Exchange Act"), no
consent, approval, order or authorization of, or registration,
declaration or filing with, any court, administrative agency or
commission or other governmental authority or instrumentality,
domestic, foreign or supranational ("Governmental Entity"), is required
by or with respect to any Stockholder in connection with the execution
and delivery of this Agreement or the consummation by any Stockholder
of the transactions contemplated hereby.
(b) The Owned Shares. The Stockholders have good and valid
title to the Owned Shares, free and clear of any claims, liens,
encumbrances, pledges and security interests whatsoever. The
Stockholders own no shares of CT Common Stock or other shares of stock
of CT, other than the Owned Shares. Except for this Agreement, no
proxies or powers of attorney have been granted with respect to the
Owned Shares and no voting arrangement (including voting agreement or
voting trust) has been entered into affecting the Owned Shares that
will remain in effect after the execution of this Agreement.
(c) Venture Agreement. The Stockholders understand and
acknowledge that General XXXX XX is entering into the Venture Agreement
in reliance upon the Stockholders' execution and delivery of this
Agreement.
2. Representations and Warranties of General XXXX XX. General
XXXX XX hereby represents and warrants to the Stockholders as follows:
(a) Authority. General XXXX XX has all requisite limited
liability company power and authority to enter into this Agreement and
to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement by General XXXX XX, and the consummation of
the transactions contemplated hereby, have been duly authorized by all
necessary limited liability company action on the part of General XXXX
XX. This Agreement has been duly executed and delivered by General XXXX
XX, assuming the due authorization, execution and delivery by each of
the Stockholders, constitutes a valid and binding obligation of General
XXXX XX enforceable in accordance with its terms, except to the extent
enforceability may be limited by bankruptcy, insolvency, moratorium or
other similar laws affecting creditors' rights generally or by general
principles governing the availability of equitable remedies. The
execution and delivery of this Agreement does not, and the consummation
of the transactions contemplated hereby and compliance with the terms
hereof will not, conflict with, or result in any violation of or
default (with or without notice or lapse of time or both) under any
provision of any limited liability company agreement, loan or credit
agreement, note, bond, mortgage, indenture, lease or other agreement,
instrument, permit, concession, franchise, license, judgment, order,
notice, decree, statute, law, ordinance, rule or regulation applicable
to General XXXX XX or to any of the property or assets of any of
General XXXX XX. Except for consents, approvals, authorizations and
filings as may be required under the HSR Act and the Exchange Act, no
consent, approval, order or authorization of, or registration,
declaration or filing with, any Governmental Entity, is required by or
with respect to any Stockholder in connection with the execution and
delivery of this Agreement or the consummation by General XXXX XX of
the transactions contemplated hereby.
3. Covenants of the Stockholders. Until the valid termination
of the provisions of this Section 3 pursuant to Section 8, the Stockholders
agree as follows:
(a) At any meeting of stockholders of CT called to vote upon
the Warrant Issuance (as such term is defined in the Venture Agreement)
or at any adjournment thereof or in any other circumstances upon which
a vote, consent or other approval with respect to the Warrant Issuance
is sought, the Stockholders shall vote (or cause to be voted) all
shares of CT Common Stock they own or have voting control over in favor
of the Warrant Issuance.
(b) At any meeting of stockholders of CT or at any adjournment
thereof or in any other circumstances upon which the Stockholders'
vote, consent or other approval is sought, the Stockholders shall vote
(or cause to be voted) all shares of CT Common Stock owned by them or
over which they have voting control against any amendment of CT's
charter and amended and restated bylaws or other proposal or
transaction involving CT or any of its subsidiaries, which amendment or
other proposal or transaction would reasonably be expected in any
manner to impede, frustrate, prevent or nullify CT's ability or
obligation to consummate or effect the Warrant Issuance.
(c) The Stockholders shall not (i) Transfer or Otherwise
Dispose (as hereinafter defined) of, or enter into any agreement or
other arrangement with respect to, the Owned Shares to any person, (ii)
enter into any voting arrangement, whether by proxy, voting agreement,
voting trust, power of attorney or otherwise with respect to, the Owned
Shares, except as provided in this Agreement or (iii) take any other
action that would reasonably be expected in any way to restrict, limit,
or interfere with the performance of their obligations hereunder.
Notwithstanding the foregoing, nothing contained in this Agreement
shall be deemed to restrict or prohibit the ability of (i) each
Stockholder to transfer shares to immediate family members or trusts or
other entities in connection with estate planning objectives, provided
that such transferee agrees in writing to be bound by the terms of this
Agreement as though such transferee were a Stockholder, and that notice
and a copy of such agreement are provided to General XXXX XX prior to
such transfer or (ii) each Stockholder from pledging its shares of CT
Common Stock to any nationally recognized financial institution as
collateral for a bona fide third party loan or from using its shares of
CT Common Stock as collateral for a bona fide third party margin loan
with a nationally recognized financial institution or broker/dealer,
provided, that, if the aggregate fair market value of all of the
collateral securing such loan or margin loan as of the date the CT
Common Stock is first pledged or used as collateral is less than two
(2) times the amount of such loan or margin loan, such financial
institution or broker/dealer agrees in writing to be bound by the terms
of this Agreement following a foreclosure on the CT Common Stock as
though such pledge or margin credit provider were a Stockholder, and
that notice and a copy of such agreement are provided to General XXXX
XX immediately following such agreement. For purposes of this
Agreement, "Transfer or Otherwise Dispose" means any sale, exchange,
redemption, assignment, gift, grant of a security interest, pledge or
other encumbrance, or the creation of any other claim thereto or any
other transfer or disposition whatsoever (including involuntary sales,
exchanges, transfers or other dispositions, and whether or not for cash
or other consideration) affecting the right, title, interest or
possession in, to or of CT Common Stock.
(d) For purposes of this Section 3, "fair market value" means
the closing price on the date preceding the loan or margin transaction,
and "closing price," with respect to any security on any day, means the
last reported sale price, regular way on such day, or, if no sale takes
place on such day, the average of the reported closing bid and asked
prices on such day, regular way, in either case as reported on the NYSE
Composite Tape, or, if such security is not listed or admitted to
trading on the New York Stock Exchange, on the principal national
securities exchange on which such security is listed or admitted to
trading, or, if such security is not listed or admitted to trading on a
national securities exchange, on the NASDAQ Stock Market of the
National Association of Securities Dealers, Inc., or, if such security
is not quoted or admitted to trading on such quotation system, on the
principal quotation system on which such security is listed or admitted
to trading or quoted, or, if not listed or admitted to trading or
quoted on any national securities exchange or quotation system, the
average of the closing bid and asked prices of such security in the
over-the-counter market on the day in question as reported by the
National Quotation Bureau Incorporated, or a similar generally accepted
reporting service, or, if not so available in such manner, as furnished
by any New York Stock Exchange member firm selected from time to time
by the Board of Directors of CT (the "CT Board") (or any committee duly
authorized by the CT Board) for that purpose or, if not so available in
such manner, as otherwise determined in good faith by the CT Board (or
any committee duly authorized by the CT Board).
4. Additional Covenants of the Stockholders. Until the valid
termination of the provisions of this Section 4 pursuant to Section 8, the
Stockholders agree as follows:
(a) At any meeting of stockholders of CT called to vote upon
any REIT Tax Matter submitted to a vote pursuant to Section 2.14 of the
Venture Agreement or at any adjournment thereof or in any other
circumstances upon which the Stockholders' vote, consent or other
approval with respect to any such REIT Tax Matter is sought, the
Stockholders shall vote (or cause to be voted) all shares of CT Common
Stock they own or have voting control over at such time in favor of
such REIT Tax Matter.
(b) At any meeting of stockholders of CT or at any adjournment
thereof or in any other circumstances upon which the Stockholders'
vote, consent or other approval is sought, the Stockholders shall vote
(or cause to be voted) all shares of CT Common Stock owned by them or
over which they have voting control at such time against any amendment
of CT's charter and amended and restated bylaws or other proposal or
transaction involving CT or any of its subsidiaries, which amendment or
other proposal or transaction would reasonably be expected in any
manner to impede, frustrate, prevent or nullify CT's ability or
obligation to consummate or effect any REIT Tax Matter.
5. Further Assurances. Each Stockholder will, from time to
time, execute and deliver, or cause to be executed and delivered, such
additional or further transfers, assignments, endorsements, consents and other
instruments as General XXXX XX may reasonably request for the purpose of
effectively carrying out the transactions contemplated by this Agreement and to
vest the power to vote such Stockholder's Owned Shares as contemplated in
Section 3.
6. Duty. Notwithstanding the covenants of Stockholders
contained in Sections 3 and 4, any Stockholder who is an officer or director of
CT, only in his capacity as an officer or director of CT, may take any such
action that is in furtherance of the exercise of his duties as an officer or
director under Maryland law, and no such action in furtherance of the exercise
of such duties shall be deemed to be a breach or violation of the covenants of
such Stockholder contained in Sections 3 and 4 and the Stockholders shall not
have any liability hereunder for any such action taken in his capacity as an
officer and director of CT in furtherance of the exercise of such duties.
7. Assignment. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the parties
without the prior written consent of the other parties, except that General XXXX
XX may assign, in its sole discretion, any or all of its rights and interests to
Citigroup Inc. or any of its direct or indirect wholly owned subsidiaries or
other entities or to Travelers Property Casualty Corp. or any of its direct or
indirect wholly owned subsidiaries or other entities. Subject to the preceding
sentence, this Agreement shall be binding upon, inure to the benefit of and be
enforceable by the parties and their respective successors and assigns and, in
the case of any Stockholder that is an individual, the heirs, executors and
administrators of such Stockholder.
8. Termination. The rights and obligations contained in
Section 3 shall terminate and shall be of no further legal force and effect on
the date on which stockholders of CT shall have considered and voted upon the
Warrant Issuance. The rights and obligations contained in Section 4 shall
terminate and shall be of no further legal force and effect on the earlier of
the date on which (i) stockholders of CT shall have considered and voted upon
any REIT Tax Matters presented for a vote pursuant to Section 2.14 of the
Venture Agreement, (ii) if the Fund II Initial Closing shall not have occurred
by no later than December 31, 2000 or any Extension Date, (a) the Unwind set
forth in the Fund I Agreement is commenced or (b) any dissolution or liquidation
of Fund I in accordance with its terms is completed, (iii) the Appraisal
Procedures shall have commenced with respect to the Fair Market Value of the CIG
Parties' and their Affiliates' Board Right Shares pursuant to Section 2.14 of
the Venture Agreement, or (iv) upon the resignation of the CIG Parties Initial
Board Designees as set forth in Section 2.12(e) of the Venture Agreement if the
CIG Parties or the CT Parties shall have exercised their right to terminate the
Venture Agreement pursuant to Section 2.12(e) of the Venture Agreement.
9. General Provisions.
(a) Specific Performance. The parties agree that irreparable
damage that is impossible to measure in money damages would occur in
the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise
breached. It is accordingly agreed that the parties shall be entitled
to an injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the terms and provisions of this Agreement
in any court of the United States located in the State of New York or
any New York state court, this being in addition to any other remedy to
which they are entitled at law or in equity.
(b) Expenses. All costs and expenses incurred in connection
with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such expense.
(c) Amendments. This Agreement may not be amended except by an
instrument in writing signed by each of the parties hereto.
(d) Notice. All notices or other communications required or
permitted hereunder shall be in writing and shall be deemed given or
delivered (i) when delivered personally, or (ii) if sent by registered
or certified mail, return receipt requested, or by private courier when
received; and shall be addressed as follows:
If to General XXXX XX, to:
Travelers General Real Estate Mezzanine
Investments II, LLC
000 Xxxxxxxx Xxxx., 0XX
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Attn: Xxxxx Xxxxxx, Esq.
Real Estate Investment Number: 12833
With a copies to:
Citigroup Investments Inc.
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Mr. Xxxxxxx Xxxxxx
Real Estate Investment Number: 12833
Loeb & Loeb LLP
0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxx, Esq.
If to the Stockholders, to:
c/o Equity Group Investments, Inc.
Xxx Xxxxx Xxxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
With a copy to:
Battle Xxxxxx LLP
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxx, Esq.
or to such other address as such party may indicate by a notice delivered to the
other parties hereto.
(e) Interpretation. When a reference is made in this Agreement
to Sections, such reference shall be to a Section to this Agreement
unless otherwise indicated. The headings contained in this Agreement
are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. Wherever the words
"include", "includes" or "including" are used in this Agreement, they
shall be deemed to be followed by the words "without limitation".
(f) Counterparts. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same
agreement, and shall become effective when one or more of the counter
parties have been signed by each of the parties and delivered to the
other party, it being understood that each party need not sign the same
counterpart.
(g) Entire Agreement; No Third-Party Beneficiaries. This
Agreement together with all other agreements executed by the parties
hereto on the date hereof (including the documents and instruments
referred to herein), (i) constitutes the entire agreement and
supersedes all prior agreements and understandings, both written and
oral, among the parties with respect to the subject matter hereof and
(ii) is not intended to confer upon any person other than the parties
hereto any rights or remedies hereunder.
(h) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York as to
all matters, including but not limited to, matters of validity,
construction, effect, performance and remedies, without regard to any
applicable conflicts of law.
(i) Waivers. Any term or provision of this Agreement may be
waived, or the time for its performance may be extended, by the party
or parties entitled to the benefit thereof. Any such waiver shall be
validly and sufficiently given for the purposes of this Agreement if,
as to any party, it is in writing signed by an authorized
representative of such party. The failure of any party hereto to
enforce at any time any provision of this Agreement shall not be
construed to be a waiver of such provision, nor in any way to affect
the validity of this Agreement or any part hereof or the right of any
party thereafter to enforce each and every such provision. No waiver of
any breach of this Agreement shall be held to constitute a waiver of
any other or subsequent breach.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
TRAVELERS GENERAL REAL ESTATE
MEZZANINE INVESTMENTS II, LLC
By:
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Xxxxxxx Xxxxxx
Vice President
XXXX X. XXXXXXXXXX
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GRG INVESTMENT PARTNERSHIP LP
By: Xxxx X. Xxxxxxxxxx, its general partner
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Xxxx X. Xxxxxxxxxx
