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EXHIBIT 99.6
September 28, 1997
Crescent Real Estate Equities Limited Partnership
000 Xxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Dear Sirs:
Vornado Realty Trust ("VRT") and Vornado, as defined below, have
entered into definitive merger agreements (the "Merger Agreements") to acquire
URS Logistics, Inc. and Americold Corporation (the "Companies"), copies of
which are attached hereto as Exhibit A. Crescent Real Estate Equities Limited
Partnership ("Crescent"), a Delaware limited partnership managed by Crescent
Real Estate Equities Company, a Texas real estate investment trust ("CEI") and
Portland Parent Incorporated and Atlanta Parent Incorporated, both Delaware
corporations (collectively, "Vornado") have agreed to Crescent becoming
Vornado's partner in those investments (the "Investments"), and hereby form a
partnership on the following terms. You acknowledge that you have completed all
due diligence with respect to both Companies and the Merger Agreements and are
satisfied with the results thereof and have all necessary board approvals to
enter into this transaction.
The agreed upon terms are as follows:
1. Partnership. As promptly as practicable after the date hereof, the
parties (a) shall commence the negotiation of a definitive partnership
agreement evidencing the partnership created hereby and such other terms
as the parties shall mutually agree and (b) shall execute and deliver,
or cause to be executed and delivered, as applicable, the partnership
agreement.
2. Interim Decisions. From and after the date hereof until the later of
execution and delivery of the partnership agreement and the closings
under the Merger Agreements, but subject to the provisions of Section 9
hereof, all decisions with respect to the acquisition of the
Investments, including, without limitation, the interpretation and
performance of Vornado's rights and obligations under the Merger
Agreements and all operational decisions with respect to the Companies
shall be made by Vornado.
3. Structure. As promptly as practicable, we will meet to determine the
structure of the partnership's investment, taking into account the
individual REIT structures of VRT and CEI and any structural
reconfigurations contemplated by either of us, in order to achieve the
optimal tax vehicle for Vornado. Depending on the structure chosen and
any potential delay your investment might cause in closing the mergers,
the timing of your capital contribution to consummate the investment
could occur either prior to or promptly following the closing of the
above mergers, at Vornado's option. Prior to the closing of the
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September 28, 1997
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Merger Agreements, it is anticipated that the rights under this agreement
will be assigned to affiliates or related entities of Crescent and Vornado
in such manner and to such extent as may be required to achieve the
structure determined pursuant to this paragraph.
4. Ownership. Crescent will hold 40% and Vornado will hold 60% of the
ownership, capital and financial interest in the partnership. Vornado will
contribute 60% and Crescent will contribute 40% of all costs required to
make the Investments (including all transaction costs and prepayment of all
debt, including prepayment fees).
5. Management.
a. Each partner will be required to approve the following actions: (i)
approval of the annual capital and operating budgets of each Company,
any deviations in any such budget by 10% or more in the aggregate per
budget, the hiring or firing of a chief executive officer of either
Company or a combined entity and any required capital contributions by
the partners in excess of $50 million per year, and (ii) other than
transactions necessary to effect the tax structuring contemplated by
paragraph 2 or to preserve either VRT's or CEI's REIT status, any
transactions with an affiliate of any partner, the sale or acquisition
of any asset (including, without limitation, equity interests in any
entity) with a value of more than $25 million, the creation of any
security interest, lien or other encumbrance on any of the
partnership's assets which treats one partner differently from another,
the making of any loan, advance or extension of credit to any partner,
any guarantee of any direct or indirect obligation of any partner, and
any sale, liquidation or merger of either Company (other than a
combination of the two Companies) or a combined entity.
b. Vornado will serve as operating manager of the Companies and the
day-to-day liaison to the management. While it is our intention that
the Companies or a combined entity would operate relatively
autonomously, any required decisions which would not fall within
subparagraph (a) of this agreement would be made by Vornado. For such
services, Vornado shall receive a fee per annum equal to 1% of the cost
(including for such purposes the amount of indebtedness on the acquired
entity or assets at the time of acquisition and all expenses (including
prepayment penalties) incurred in such acquisition) paid to acquire the
Companies and any entities or assets hereafter acquired.
6. Term. Except as otherwise agreed by the partners, the partnership shall
continue for a term of 30 years from the date hereof, except that it shall
terminate if the Merger Agreements terminate or if Crescent or any
affiliate thereof takes any action in violation of Section 9 hereof. The
partnership shall preserve and maintain its existence and all its rights,
privileges and franchises. Neither partner shall have the right to withdraw
from the partnership, except as provided herein, nor shall either partner
have the right to cause the dissolution, termination, liquidation or
winding-up of the partnership without the consent of the remaining partner.
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7. Agreement to Act in Good Faith. The partnership agreement shall
require each partner to cooperate with the other partner thereto to
carry out the purpose and intent of the partnership, including without
limitation the execution and delivery to the appropriate party of all
such further documents as may reasonably be required in order to carry
out the terms of the partnership. The parties shall act in a
commercially reasonable manner in good faith with one another in
negotiating the terms of the partnership agreement and all of required
contracts, agreements or documents, in operating the partnership, and in
carrying out the terms of this agreement.
8. Buy/Sell. In the event the partners fail in good faith to reach an
agreement with respect to any matters set forth in paragraph 5(a) on a
timely basis during the first three years after the date hereof, Vornado
shall be entitled to buy Crescent's interest at cost plus a 10% per
annum return (taking into account all distributions). Thereafter, for
the next seven years, upon such failure, Vornado may set a price at
which it commits to either buy Crescent's investment, or sell its own,
which decision to buy or sell shall be made by Crescent. Thereafter,
upon such failure, either party may set a price at which its commits to
either buy the other party's investment, or sell it own, which decision
to buy or sell shall be made by the other party. In addition, each side
shall have the right of first refusal with respect to the sale of the
other party's investment in the partnership, except that during the
first three years Vornado's purchase price with respect to Crescent's
shares under such right of first refusal shall be cost plus a 10% return
(taking into account all distributions).
9. Exclusivity; Non-Solicitation. Prior to the closings under the Merger
Agreements, Crescent shall not, and shall not permit any of its
employees, agents, representatives or affiliates to, (i) without Vornado
being fully informed thereof and consenting thereto, contact Xxxxx or
any officer, director, employee, agent or customer of either Company
with respect to the Investments, (ii) offer, negotiate, consummate or
solicit any offer or proposal for a "Sales Transaction" (as hereinafter
defined), including without limitation holding any discussions or
engaging in any communications, or entering into any agreement or
understanding whatsoever with Xxxxx or the Companies without Vornado
being fully informed thereof and consenting thereto, or (iii) take any
action to disrupt the closings under the Merger Agreements. Crescent's
obligations under the preceding sentence shall survive any termination
of the partnership and shall terminate only upon the termination of both
Merger Agreements. For the purposes of this agreement, the term "Sales
Transaction" means (A) any merger, consolidation, reorganization or
other business combination pursuant to which the business of either of
the Companies would be combined with that of Crescent (or an affiliate
thereof) or (B) the acquisition, directly or indirectly, by a third
party of any equity interest, debt, or any assets (other than in the
ordinary course of business) of either of the Companies. Prior to the
closings under the Merger Agreements, Vorando agrees that neither it
nor any of its affiliates will enter into any agreements with the
Companies that would require approval as an affiliate transaction under
paragraph 5(a).
10. Expenses. The parties shall each pay their own fees and expenses,
and those of their agents, advisors, attorneys and accountants, with
respect to the negotiation of this
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agreement and the formation of the partnership, and shall evenly split the
expenses incurred on account of the partnership after the date hereof or by
Vornado prior to the date hereof in connection with the negotiation and
execution of the Merger Agreements (including, without limitation, due
diligence).
11. Assignment. The terms and provisions of this agreement shall not be
assignable by either party without the other party's consent, except as
contemplated by the structure determined pursuant to paragraph 3.
12. Public Announcement. The parties intend to make a public announcement
regarding the execution of this agreement promptly following the execution
hereof. Vornado will act as spokesperson for the partnership and will provide
notice to Crescent of any proposed press release or other public announcement,
and will work with Crescent on the content of any such press release or public
announcement.
13. Agreement Not to Compete. The parties agree that so long as the
partnership continues in existence, no partner thereto shall engage in the cold
storage businesses of the type conducted by the Companies except through the
partnership.
14. Miscellaneous.
a. This agreement and all transactions hereunder shall be governed by the
laws of the State of Delaware, without regard to the application of conflict
of law principles. The parties hereby irrevocably submit to the jurisdiction
of the courts of the State of Delaware and to the U.S. District Court for the
Southern District of New York solely in respect of the interpretation and
enforcement of the provisions of this agreement, and hereby waive, and agree
not to assert, as a defense in any action, suit or proceeding for the
interpretation or enforcement hereof or of any such document, that it is not
subject thereto or that such action, suit of proceeding may not be brought or
is not maintainable in said courts or that the venue thereof may not be
appropriate or that this agreement may not be enforced in or by such courts,
and the parties hereto irrevocably agree that all claims with respect to such
action or proceeding shall be heard and determined in such a Delaware State
court or Federal District Court for the Southern District of New York. The
parties hereby consent to and grant any such court jurisdiction over the
person of such parties and over the subject matter of such dispute.
b. This agreement constitutes the entire agreement between the parties with
respect to the subject matter herein; provided, however, that this agreement
contemplates the negotiation and execution of definitive agreements after the
execution of this agreement as provided herein, which definitive agreements
also shall be binding on the parties thereto following execution thereof.
c. No amendment or waiver of any provision of this agreement shall be
effective unless in writing and signed by the party or parties against whom
enforcement is sought. No failure or delay by any party in exercising any
right, power or privilege
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hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or
the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law.
d. The rule that an agreement should be construed against the party
drafting it shall not apply to this agreement because both parties have
played a significant role in negotiating and drafting this agreement.
e. This agreement may be executed in any number of counterparts, each of
which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
f. Signatures may be transmitted by facsimile and will be accepted and
considered delivered as if an original.
Atlanta Parent Incorporated
By: /s/ Xxxxxxx Xxxxxxxxxx
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Name: Xxxxxxx Xxxxxxxxxx
Title: Vice President,
Chief Financial Officer
and Treasurer
Portland Parent Incorporated
By: /s/ Xxxxxxx Xxxxxxxxxx
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Name: Xxxxxxx Xxxxxxxxxx
Title: Vice President,
Chief Financial Officer
and Treasurer
Agreed to and accepted as of September 28, 1997 by
Crescent Real Estate Equities Limited Partnership
By: Crescent Real Estate Equities, Ltd.,
its general partner
By: /s/ Xxxxxx Xxxxxxx
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Name: Xxxxxx Xxxxxxx
Title: President and
Chief Executive
Officer
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