Exhibit 10.8
FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT
THIS FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT (this "Amendment") is
entered into by and among CarrAmerica Realty Corporation ("CarrAmerica"),
OmniOffices (UK) Limited ("Omni UK"), OmniOffices (Lux) 1929 Holding Company
S.A. ("LuxCo"), VANTAS Incorporated ("VANTAS") and FrontLine Capital Group
(formerly known as Reckson Services Industries, Inc.) ("RSI") as of April 29,
2000.
RECITALS:
WHEREAS, CarrAmerica, Omni UK, LuxCo, VANTAS and RSI entered into a
Stock Purchase Agreement dated as of January 20, 2000 (such agreement, as
heretofore, hereby and hereinafter amended, the "UK Agreement") pursuant to
which CarrAmerica agreed to sell shares of common stock of Omni UK and LuxCo
owned by it together with its interest in certain loans made by it to Omni UK
and LuxCo to VANTAS on the terms set forth therein;
WHEREAS, VANTAS, RSI, CarrAmerica, Omni UK and LuxCo have executed an
Agreement dated as of March 13, 2000, as amended, pursuant to which such parties
agreed to authorize certain actions governed by the UK Agreement;
WHEREAS, the parties hereto wish to make certain additional amendments
to the UK Agreement; and
WHEREAS, capitalized terms not otherwise defined herein shall have the
meanings set forth in the UK Agreement.
NOW, THEREFORE, in consideration of the foregoing and the respective
covenants and agreements set forth herein, the parties, intending to be legally
bound, agree as follows:
1. The second and third recitals of the UK Agreement are hereby
deleted in their entirety and replaced with the following:
"WHEREAS, CarrAmerica has made certain loans to Omni UK and LuxCo as
described on Exhibit B attached hereto, and may make additional loans
to Omni UK and LuxCo as contemplated by Section 4.1(b)(iii) hereof
(collectively, the "Loans"), which Loans are or will be evidenced by
promissory notes, the date and denominations of which as of the date
hereof are set forth on Exhibit B (the "Notes");
WHEREAS, CarrAmerica desires to sell and transfer to VANTAS and VANTAS
desires to purchase from CarrAmerica (i) the Notes in exchange for an
amount equal to the principal amount of, and any accrued and unpaid
interest with respect to, the Notes outstanding as of the Closing Date
in accordance with Section 1.2 (the "Loan Consideration"), and (ii)
all of the shares of non-voting common stock, par value (Pounds).01
per share, of Omni UK (which represents approximately 95% of the
equity interest in Omni UK) (the "UK Non-Voting Common Stock") and all
of the shares of non-voting common stock, par value $250 per share, of
LuxCo (which represents approximately 95% of the equity interest in
LuxCo) (the "Lux Non-Voting Common Stock"; and together with the UK
Non-Voting Common Stock, collectively, the "Shares") owned of record
by the Seller for total consideration equal to the "Share
Consideration" as calculated pursuant to Annex A (the "Share
Consideration");"
2. Section 2.3 of the UK Agreement is hereby amended by inserting
the following at the end of Section 2.3:
"Notwithstanding anything to the contrary contained herein, the
parties acknowledge that, in connection with the consummation of the
transactions contemplated by the Merger Agreement, the consent of the
general partner of Mercury Executive Offices, L.P. may be required
under the Limited Partnership Agreement dated November 16, 1998 and
the management agreements related thereto; it being understood that
Omni UK, LuxCo, VANTAS and RSI shall use commercially reasonable
efforts to obtain such consent."
3. Section 2.12(a) of the UK Agreement is hereby amended by deleting
the first sentence in its entirety and replacing it with the following:
"Neither of the Companies nor any of their respective Subsidiaries
owns any real property or interests in real property, other than
OmniUK Real Property Leases (as defined below), LuxCo Real Property
Leases (as defined below), the OmniUK Owned Property (as defined
below) and certain interests in certain real property assets held
directly or indirectly through the MAM Investment (as defined below)."
4. The provision immediately following Section 2.13(j) on page 12 of
the UK Agreement is hereby deleted in its entirety and replaced with the
following:
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"; provided, however, that notwithstanding anything to the contrary
contained herein other than any contracts relating to office
equipment, maintenance or service for any individual business center
of the Companies or their respective Subsidiaries which does not
require annual payments in excess of $25,000, the sum of the aggregate
future liabilities and costs of termination associated with all
contracts, arrangements, agreements or understandings to which either
of the Companies or any of their respective Subsidiaries is a party or
by which they or any of their respective properties or assets which
are not set forth on Schedule 5.2, 2.13 or 2.16 is bound does not
exceed $5,000,000."
5. Section 2.28 of the UK Agreement is hereby deleted in its
entirety and replaced with the following:
"Section 2.28 MAM Investment. OmniUK and certain of its Subsidiaries
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have agreed to invest up to (Pounds)20 million in Mercury Executive
Offices, L.P. on the terms and conditions set forth in the limited
partnership agreement, dated November 16, 1998 (the "MAM Investment"),
of which at least (Pounds)15,594,241 has been funded. Notwithstanding
anything to the contrary contained herein, the parties acknowledge
that, in connection with the consummation of the transactions
contemplated by the Merger Agreement, the consent of the general
partner of Mercury Executive Offices, L.P. may be required under the
Limited Partnership Agreement dated November 16, 1998 and the
management agreements related thereto; it being understood that Omni
UK, LuxCo, VANTAS and RSI shall use commercially reasonable efforts to
obtain such consent."
6. Section 4.1(b)(iii) of the UK Agreement is hereby deleted in its
entirety and replaced with the following:
"incur or assume any liabilities or incur any indebtedness for
borrowed money, assume, guarantee, endorse or otherwise as an
accommodation become responsible for the obligations of any other
individual, corporation or entity (other than a wholly owned
Subsidiary) except pursuant to contracts or agreements listed in
Schedule 2.13 or except for loans and equity investments (which shall
be deemed to be included on Exhibit A or Exhibit B, as applicable,
attached hereto) by CarrAmerica necessary to fund the business of the
Companies in the ordinary course or to fund committed developments;"
7. Section 4.1(b)(v) of the UK Agreement is hereby deleted in its
entirety and replaced with the following:
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"make any material change in any Omni UK Real Property Lease or LuxCo
Real Property Lease, as applicable, or other contracts or enter into,
renew, fail to renew, terminate or permit to be terminated any Omni UK
Real Property Lease or LuxCo Real Property Lease, as applicable, any
other contract or agreement that calls for aggregate annual payments
of $25,000 or more and which either (i) is not terminable by either of
the Companies or their respective Subsidiary, as applicable, at will
on 60 days or less notice without payment of a penalty or (ii) has a
term of more than six months, other than the operating leases and
related letters of comfort executed by Omni UK, LuxCo or any
Subsidiaries thereof with respect to development and refurbishment
projects identified in the CapEx Budget, as contemplated by the
operating budgets for those projects;"
8. Section 5.5 of the UK Agreement is hereby amended by inserting
the following sentence at the end of such section:
"Not later than six months after the Closing, the Second Step
Surviving Corporation shall reimburse CarrAmerica, as agent for itself
and the stockholders of HQ Global Workplaces, Inc. ("HQ Global")
immediately prior to the Closing (based on their proportionate
indirect beneficial interests in Omni UK and LuxCo), for any
additional lease deposits of Omni UK and LuxCo that are not identified
on the disclosure schedules delivered in connection with the execution
of this Agreement; provided that the Second Step Surviving Corporation
is provided with a schedule of such additional lease deposits at or
prior to Closing."
9. Article 5 of the UK Agreement is hereby amended by adding the
following sections at the end of such Article 5:
"Section 5.6 MAM Hammersmith Center. RSI and VANTAS hereby consent
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to the development of the MAM Hammersmith center. Immediately
subsequent to the Closing, the Second Step Surviving Corporation shall
reimburse CarrAmerica, as agent for itself and the stockholders of HQ
Global immediately prior to the Closing (based on their proportionate
indirect beneficial interests in Omni UK and LuxCo), for any costs
that have been or will be incurred prior to Closing in connection with
the development of the MAM Hammersmith center; provided that the
Second Step Surviving Corporation is provided with a schedule of such
amounts at or prior to Closing.
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Section 5.7 Prepaid Rent; Tenant Reimbursement. Immediately
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subsequent to the Closing, the Second Step Surviving Corporation shall
pay to CarrAmerica, as agent for itself and the stockholders of HQ
Global immediately prior to the Closing (based on their proportionate
indirect beneficial interests in Omni UK and LuxCo), $576,000, which
represents the amount of rent of Omni UK and LuxCo that was prepaid
for the period after Closing;; provided that the Second Step Surviving
Corporation is provided with a schedule of such amounts at or prior to
Closing.
Section 5.8 Capital Expenditures and Cash Fundings. Immediately
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subsequent to the Closing, the Second Step Surviving Corporation shall
reimburse CarrAmerica, as agent for itself and the stockholders of HQ
Global immediately prior to the Closing (based on their proportionate
indirect beneficial interests in Omni UK and LuxCo), for all capital
expenditures and development expenses of Omni UK or LuxCo incurred
after April 30, 2000 and prior to Closing, including amounts funded to
enable Omni UK to satisfy its capital commitments with respect to the
MAM Investment; provided that the Second Step Surviving Corporation is
provided with a schedule of such amounts at or prior to Closing.
Section 5.9 Side Letter. At Closing, VANTAS shall assume the
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obligations of CarrAmerica with respect to that certain Side Letter
dated as of November 16, 1998 by and among HQMerc UK Management
Limited ("HQ Merc"), P.R.A. Investments Limited ("PRA"), P.K.
Investments Limited ("PKL"), Peter Allport ("Allport"), Peter Kershaw
("Kershaw"), HQ Holdings Limited ("HQ Holdings") and CarrAmerica and
that certain Side Letter dated as of November 16, 1998 by and among HQ
Merc UK Partnership Limited, PRA, PKL, Allport, Kershaw, HQ Holdings
and CarrAmerica."
10. Section 6.2(b) of the UK Agreement is hereby deleted in its
entirety and replaced with the following:
"CarrAmerica shall have received the cash required by Sections 1.2,
5.3, 5.5, 5.6, 5.7 and 5.8."
11. All references to "April 30, 2000" in Article X(a)(iv), Article
X(a)(vi) and Article X(a)(vii) of the UK Agreement are hereby changed to "May
31, 2000."
12. All references to "May 1, 2000" in Article X(a)(iv) of the UK
Agreement are hereby changed to "June 1, 2000."
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13. The amount of the Loan Notes identified in Annex A to the UK
Agreement is hereby deleted and replaced with "21,229,392 (reduced by the amount
of any payments thereto prior to Closing)."
14. Simultaneously with the execution of this Amendment, RSI shall
contribute $900,000 to VANTAS and VANTAS shall pay $900,000 in cash (the "UK
Stockholder Extension Payment") to CarrAmerica, as compensation for the
extension of the Closing Date from April 30, 2000 to May 31, 2000. The UK
Stockholder Extension Payment is nonrefundable and will not be used to adjust
the consideration otherwise payable in connection with the consummation of the
transactions contemplated by the UK Agreement.
15. CarrAmerica, Omni UK and LuxCo represent and warrant, each as to
itself only, that each of CarrAmerica, Omni, UK and LuxCo has the requisite
capacity and authority, and has taken all actions necessary in order, to
execute, deliver and perform its obligations under this Amendment. This
Amendment is a legal, valid and binding obligation of each of CarrAmerica, Omni
UK and LuxCo, enforceable in accordance with its terms, except insofar as
enforcement thereof may be limited by bankruptcy, insolvency or other laws
relating to or affecting enforcement of creditors' rights generally including
such general equitable principles as may apply in the enforcement of creditors'
rights.
16. VANTAS and RSI represent and warrant that each of VANTAS and RSI
has the requisite capacity and authority, and has taken all actions necessary in
order, to execute, deliver and perform its obligations under this Amendment.
This Amendment is a legal, valid and binding obligation of each of VANTAS and
RSI, enforceable in accordance with its terms, except insofar as enforcement
thereof may be limited by bankruptcy, insolvency or other laws relating to or
affecting enforcement of creditors' rights generally including such general
equitable principles as may apply in the enforcement of creditors' rights.
17. This Amendment, the Merger Agreement, as amended, the Stock
Purchase Agreement, as amended, and the other agreements referred to herein and
therein represent the entire understanding of the parties with respect to the
subject matter contained herein. This Amendment may not be amended, modified or
waived except in a writing signed by the party against whom enforcement of such
amendment, modification or waiver is sought. This Amendment shall be construed
and interpreted in accordance with the laws of the State of Delaware, without
reference to the conflict of laws principles contained therein. This Amendment
may be executed in one or more counterparts, each of which shall be deemed an
original, but all of which, when taken together, shall constitute one and the
same instrument.
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[signature page follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed as of the date first written above.
CARRAMERICA REALTY CORPORATION
By: /s/ Karen B. Dorigan
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Name: Karen B. Dorigan
Title: Managing Director
OMNIOFFICES (UK) LIMITED
By: /s/ Thomas A. Carr
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Name: Thomas A. Carr
Title: Director
OMNIOFFICES (LUX) 1929 HOLDING COMPANY S.A.
By: /s/ Thomas A. Carr
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Name: Thomas A. Carr
Title: Director
FRONTLINE CAPITAL GROUP
By: /s/ Jason Barnett
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Name: Jason Barnett
Title: Executive Vice President
VANTAS INCORPORATED
By: /s/ Steven M. Rathkopf
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Name: Steven M. Rathkopf
Title: Secretary
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