Exhibit 99.1
SHAREHOLDER VOTING AGREEMENT
THIS SHAREHOLDER VOTING AGREEMENT, dated as of April 1, 1998, is entered
into by and among Security Capital Group Incorporated, a Maryland corporation
("Shareholder"), Security Capital Atlantic Incorporated, a Maryland corporation
("East"), and Security Capital Pacific Trust, a Maryland real estate investment
trust ("West").
WHEREAS, as of the date hereof Shareholder owns beneficially and SC Realty
Incorporated, a Nevada corporation and direct wholly owned subsidiary of
Shareholder ("Record Holder"), owns of record, 30,687,072 shares of beneficial
interest, $1.00 par value per share ("West Common Stock"), of West (all such
shares and any shares of West Common Stock that hereafter become beneficially
owned by the Shareholder, through Record Holder or otherwise, prior to the
termination of this Agreement being referred to herein as the "West Shares"),
representing 32.9% of the issued and outstanding shares of West Common Stock as
of the date hereof;
WHEREAS, as of the date hereof Shareholder owns beneficially and Record
Holder owns of record 23,853,210 shares of common stock, $0.01 par value per
share ("East Common Stock"), of East (all such shares and any shares of East
Common Stock that hereafter become beneficially owned by the Shareholder,
through Record Holder or otherwise, prior to the termination of this Agreement
being referred to herein as the "East Shares" and collectively with the West
Shares, the "Shares"), representing 49.9% of the issued and outstanding shares
of East Common Stock as of the date hereof;
WHEREAS, concurrently herewith, West and East are entering into an
Agreement and Plan of Merger (as such Agreement may hereafter be amended from
time to time, the "Merger Agreement"), pursuant to which, upon the terms and
subject to the conditions thereof, East will merge with and into West (the
"Merger"); and
WHEREAS, as a condition to the willingness of East and West to enter into
the Merger Agreement, each of East and West has requested that Shareholder
agree, and, in order induce East and West to enter into the Merger Agreement,
Shareholder has agreed, to the matters addressed herein;
NOW, THEREFORE, in consideration of the premises and of the mutual
representations warranties, covenants and agreements set forth herein and in the
Merger Agreement, the parties hereto, intending to be legally bound, hereby
agree as follows:
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ARTICLE I
Section 1.01. TRANSFER OF SHARES. Subject to the terms and conditions of
this Agreement, until the close of business on the date of the later to occur of
the special meetings of shareholders of East and West called to consider and
vote upon the Merger (including any adjournments thereof, the "Special
Meetings") and except as otherwise provided herein, Shareholder will not, and
will cause Record Holder and any other record holder of Shares not to, (a) sell
or otherwise dispose of any of the Shares (provided that the foregoing shall not
preclude a pledge of Shares as security with respect to a bona fide loan from a
financial institution), (b) deposit any of the Shares into a voting trust or
enter into a voting agreement or arrangement (other than this Agreement) with
respect to any of the Shares or grant any proxy with respect thereto, or (c)
enter into any contact, option or other arrangement or undertaking with respect
to the direct or indirect sale, assignment, transfer or other disposition of any
of the Shares.
Section 1.02. VOTING OF SHARES; FURTHER ASSURANCES. Subject to the terms
and conditions of this Agreement, Shareholder will vote all of the East Shares
and West Shares, as the case may be, that it owns of record on the respective
record dates for voting at the Special Meetings (or will execute written
consents with respect to such Shares) (i) in favor of the adoption of the Merger
Agreement and approval of the Merger and the other transactions contemplated by
the Merger Agreement, (ii) against any East Alternative Proposal or West
Alternative Proposal (each as defined in the Merger Agreement), and (iii) in
favor of any other matter necessary to the consummation of the Merger and the
other transactions contemplated by the Merger Agreement and considered and voted
upon at a Special Meeting (or as to which written consents are solicited).
Shareholder will cause any East Shares and West Shares, as the case may be,
owned by it beneficially, but not of record, on the respective record dates for
voting at the Special Meetings (or will cause written consents to be executed
with respect to such Shares) to be voted in accordance with the foregoing.
Shareholder acknowledges receipt and review of a copy of the Merger Agreement
prior to the execution thereof and hereof.
Section 1.03. NO SOLICITATION. Subject to the terms and conditions of
this Agreement, prior to the Effective Time (as defined in the Merger
Agreement), (a) Shareholder shall not, and shall not permit any of its officers,
directors, employees, agents or representatives (including, without limitation,
any investment banker, attorney or accountant retained by it) to, (i) initiate,
solicit, or encourage, directly or indirectly, any inquiries or the making or
implementation of any proposal or offer (including, without limitation, any
proposal or offer to East's or West's shareholders) with respect to an East
Alternative Proposal or a West Alternative Proposal or (ii) engage in any
negotiations concerning, or provide any confidential information or data to, or
have any discussions with, any person relating to an East Alternative Proposal
or a West Alternative Proposal, or otherwise facilitate any effort or attempt to
make or implement an East Alternative Proposal or a West Alternative Proposal;
and (b) Shareholder will notify East and West immediately if any such inquiries
or proposals are
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received by, any such information is requested from, or any such negotiations or
discussions are sought to be initiated or continued with, it, and East or West,
as the case may be, will notify Shareholder immediately if any such inquiries or
proposals are received by, any such information is requested from, or any such
negotiations or discussions are sought to be initiated or continued with, it;
provided, however, that the foregoing shall not prevent any discussions or other
communications between or among Shareholder, West, and East.
Section 1.04. TERMINATION OF CERTAIN RESTRICTIONS IN CERTAIN EVENTS. If
the East Board validly exercises any of its rights under the clauses (i) through
(iv) of the first proviso to Section 5.4(a) of the Merger Agreement, Shareholder
shall be relieved of the prohibition set forth in clause (a)(ii) of Section 1.03
of this Agreement with respect to, but only with respect to, the particular East
Alternative Proposal and third party making it that gives rise to the East Board
exercising such rights and only for so long as the East Board continues to
exercise such rights. If the West Board validly exercises any of its rights
under clauses (i) through (iv) of the first proviso to Section 5.4(b) of the
Merger Agreement, Shareholder shall be relieved of the prohibition set forth in
clause (a)(ii) of Section 1.03 of this Agreement with respect to, but only with
respect to, the particular West Alternative Proposal and third party making it
that gives rise to the West Board exercising such rights and only for so long as
the West Board continues to exercise such rights.
Section 1.05. TERMINATION OF CERTAIN AGREEMENTS. As of the Effective Time
(as defined in the Merger Agreement), that certain Amended and Restated Investor
Agreement dated September 9, 1997 between Shareholder and East and that certain
Administrative Services Agreement dated September 9, 1997 between Shareholder
and East shall terminate automatically, without any action being required by
Shareholder or East. Neither Shareholder nor East shall thereafter have any
further obligation under either such agreement, except for any payment
obligation of either party accrued under the Administrative Services Agreement
immediately prior to the Effective Time. The limitation upon aggregate fees for
services set forth in Section 1.4 of that certain Administrative Services
Agreement dated September 9, 1997 between Shareholder and West shall be
increased as agreed upon between Shareholder and West.
ARTICLE II
Section 2.01. NOTICES. All notices and other communications given or made
pursuant hereto shall be in writing and shall be deemed to have been duly given
or made as of the date delivered, mailed or transmitted, and shall be effective
upon receipt, if delivered personally, mailed by registered or certified mail
(postage prepaid, return receipt requested) to the parties at the following
addresses (or at such other address for a party as shall be specified by like
changes of address) or sent by electronic transmission to the telecopier number
specified below:
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If to East, to:
Security Capital Atlantic Incorporated
Six Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxxxx X. Xxxxx
Fax: 000-000-0000
and to:
Xxxxxxx & Sterling
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxx
Fax: (000) 000-0000
If to West, to:
Security Capital Pacific Trust
0000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attention: R. Xxxx Xxxxxxx
Fax: 000-000-0000
and to:
Xxxxxx, Xxxxxx & Xxxxx LLP
000 Xxxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: R. Xxxxxxx Xxxxxx
Fax: (000) 000-0000
If to Shareholder, to:
Security Capital Group Incorporated
000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxx Xx, Xxx Xxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
Fax: 000-000-0000
and with a copy of all notices to:
Xxxxx, Xxxxx & Xxxxx
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxxx
Fax: (000) 000-0000
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Section 2.02. HEADINGS. 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.
Section 2.03. SEVERABILITY. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforce, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible to the fullest extent
permitted by applicable law in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible.
Section 2.04. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement of the parties and supersedes all prior agreements and undertakings,
both written and oral, between the parties, or any of them, with respect to the
subject matter hereof.
Section 2.05. CERTAIN EVENTS. Shareholder agrees that this Agreement and
the obligations hereunder shall attach to each of Shareholder's Shares and shall
be binding upon any person to which legal or beneficial ownership (as such term
is applied under Rule 13d-3 of the Exchange Act) of such Shares shall pass,
whether by operation of law or otherwise. Notwithstanding any transfer of
Shares, the transferor shall remain liable for the performance of all
obligations under this Agreement of the transferor.
Section 2.06. ASSIGNMENT. This Agreement shall not be assigned by
operation of law or otherwise.
Section 2.07. PARTIES IN INTEREST. This Agreement shall be binding upon
and inure solely to the benefit of each party hereto, and nothing in this
Agreement, express or implied, is intended to or shall confer upon any person
any right, benefit or remedy of any nature whatsoever under or by reason of this
Agreement.
Section 2.08. SPECIFIC PERFORMANCE. The parties hereto agree that
irreparable damages would occur in the event any provision of this Agreement was
not performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in addition to any other
remedy at law or in equity.
Section 2.09. GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Maryland, without giving
effect to principles of conflicts of laws.
Section 2.10. COUNTERPARTS. This Agreement may be executed by the
different parties hereto in separate counterparts, each of which when executed
shall be deemed
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to be an original but both of which, taken together, shall constitute one and
the same agreement.
Section 2.11. TERMINATION. This Agreement shall terminate automatically
and immediately upon the earlier of (a) termination of the Merger Agreement in
accordance with the terms of Article 8 thereof and (b) the consummation of the
Merger.
Section 2.12. DEFINITIONS. Any capitalized terms used in this Agreement
that are not otherwise defined herein has the meaning given to it in the Merger
Agreement.
Section 2.13. LIMITATION OF LIABILITY. Any obligation or liability
whatsoever of East or West which may arise at any time under this Agreement or
any obligation or liability which may be incurred by it pursuant to any other
instrument, transaction or undertaking contemplated hereby shall be satisfied,
if at all, only out of East's or West's assets respectively. No such obligation
or liability shall be personally binding upon, nor shall resort for the
enforcement thereof be had to, the property of any of its shareholders,
trustees, officers, employees or agents, regardless of whether such obligation
or liability is in the nature of contract, tort or otherwise.
Section 2.14. NO PRESUMPTION AGAINST DRAFTER. Each of the parties hereto
have jointly participated in the negotiation and drafting of this Agreement. In
the event of an ambiguity or a question of intent or interpretation arises, this
Agreement shall be construed as if drafted jointly by each of the parties hereto
and no presumptions or burdens of proof shall arise favoring any party by virtue
of the authorship of any of the provisions of this Agreement.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their respective, duly authorized officers, as of the date first above
written.
Security Capital Atlantic Incorporated
By: /s/ Xxxxxxxxx X. Xxxxx
--------------------------------------
Name: Xxxxxxxxx X. Xxxxx
Title: Co-Chairman and Chief Operating
Officer
Security Capital Pacific Trust
By: /s/ R. Xxxx Xxxxxxx
--------------------------------------
Name: R. Xxxx Xxxxxxx
Title: Chief Executive Officer and
President
Security Capital Group Incorporated
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President and Secretary
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