CAPITAL TRUST
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October 23, 1998
First Chicago Capital Corporation
One First ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇ Fargo & Company
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BankAmerica Investment Corporation
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Ladies and Gentlemen:
Capital Trust, a California business trust (the "Company"), has
received the benefit of the following: (i) Amendment No. 2 to that certain
Preferred Share Purchase Agreement, dated as of June 16, 1997, by and between
the Company and Veqtor Finance Company, L.L.C., a Delaware limited liability
company ("Veqtor"), made as of October 23, 1998, by and between the Company and
Veqtor; (ii) that certain Agreement and Waiver with respect to Preferred Shares,
dated October 23, 1998, between the Company and Veqtor; and (iii) Amendment No.
1 to that certain Amended and Restated Limited Liability Company Agreement of
Veqtor, made as of October 23, 1998, among Capital Trust Investors Limited
Partnership, an Illinois limited partnership, and V2 Holdings LLC, a Delaware
limited liability company, both as the Common Members and the Managing Members,
and First Chicago Capital Corporation, a Delaware corporation ("First Chicago"),
▇▇▇▇▇ Fargo & Company, a Delaware corporation ("▇▇▇▇▇ Fargo"), and BankAmerica
Investment Corporation, an Illinois corporation ("BankAmerica"), as the
Preferred Members.
In consideration of the benefit mentioned in the foregoing paragraph,
the Company agrees to enter into this letter agreement to grant to First
Chicago, ▇▇▇▇▇ Fargo and BankAmerica (collectively, the "Subordinated
Prospective Co- Investors") certain co-investment rights that are subordinate to
the co-investment
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rights contained in that certain Co-Investment Agreement, dated as of July 28,
1998, among the Company, Vornado Realty L.P., a Delaware limited partnership,
EOP Operating Limited Partnership, a Delaware limited partnership, and General
Motors Investment Management Corporation, a Delaware corporation, as agent for
and for the benefit of the Pension Plans (as defined therein), attached hereto
as Exhibit A (the "Senior Co-Investment Agreement"). To that end, subject to the
following, the Company shall offer to the Subordinated Prospective Co-Investors
the opportunity to co-invest on a pro rata basis in any "Target Investment" (as
such term is defined in the Senior Co-Investment Agreement) for which the
Company has determined to obtain co-investors. The Company's obligation to offer
a Target Investment for co-investment by the Subordinated Prospective
Co-Investors and any such offer that is made by the Company (the "Subordinated
Offer") shall be subject to the prior rights under the Senior Co-Investment
Agreement of the "Prospective Co-Investors" (as such term is defined in the
Senior Co-Investment Agreement). The Subordinated Offer shall be made in
accordance with and subject to the terms and conditions of the Senior
Co-Investment Agreement assuming for purposes of this letter agreement that the
Subordinated Prospective Co-Investors are Prospective Co-Investors, except that
the Company shall be obligated to offer the Subordinated Prospective
Co-Investors the opportunity to co-invest in any such Target Investment only to
the extent that the Prospective Co-Investors waive their right to, or decline
to, co-invest in the Target Investment in accordance with the provisions of the
Senior Co-Investment Agreement.
Notwithstanding anything to the contrary contained herein, this letter
agreement and the co-investment rights granted herein shall, with respect to any
Subordinated Prospective Co-Investor, terminate immediately upon the redemption,
pursuant to the limited liability agreement of Veqtor Finance Company, L.L.C.
("Veqtor") of any such Subordinated Prospective Co-Investor's entire interest in
Veqtor in exchange for its pro rata portion of the shares of beneficial interest
in the Company owned by Veqtor.
Except as set forth in this letter agreement, the Subordinated
Prospective Co-Investors shall have no right or obligation to co-invest in any
investment made by the Company.
The Company has signed below to indicate its agreement with the
foregoing terms and conditions. If the foregoing is acceptable to you, please
sign below and return to the Company the enclosed copy of this letter agreement
to so indicate your agreement with the foregoing terms and conditions.
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Very truly yours,
CAPITAL TRUST
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Executive Officer
By our signature below, each of the undersigned hereby severally agrees
to be bound by the terms and conditions of this letter agreement.
FIRST CHICAGO CAPITAL
CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇▇
Title: First Vice President
▇▇▇▇▇ FARGO & COMPANY
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
BANKAMERICA INVESTMENT
CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Attorney-in-Fact
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