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| CT > SEC Filings for CT > Form 8-K on 21-Dec-2012 | All Recent SEC Filings |
21-Dec-2012
Entry into a Material Definitive Agreement, Completion of Acquisition or Dispos
Indemnification Agreements with Directors and Officers
On December 19, 2012, Capital Trust entered into indemnification agreements (the "Indemnification Agreements") with each of its directors, Geoffrey G. Jervis, Capital Trust's chief financial officer, treasurer and secretary, and Thomas C. Ruffing, Capital Trust's chief credit officer and head of asset management (each, an "Indemnitee"). The Indemnification Agreements provide that Capital Trust will, subject to certain limitations and exceptions, indemnify, to the fullest extent permitted under Maryland law, and advance expenses to, each Indemnitee, in connection with (among other things) the Indemnitee's capacity as a director, officer, employee or agent of Capital Trust. This obligation includes, subject to certain terms and conditions, indemnification for any expenses (including reasonable attorneys' fees), judgments, fines, penalties and settlement amounts actually and reasonably incurred by the Indemnitee in connection with any threatened or pending action, suit or proceeding. Capital Trust may be required to advance such expenses, in which case the Indemnitee will be obligated to reimburse Capital Trust for the amounts advanced if it is later determined that the Indemnitee is not entitled to indemnification for such expenses.
The indemnification provided under the indemnification agreement is not exclusive of any other indemnity rights.
The foregoing description of the Indemnification Agreements is qualified in its entirety by reference to the complete terms of the Indemnification Agreements, a form of which is attached as Exhibit 10.1 to this Current Report on Form 8-K (this "Current Report") and incorporated herein by reference.
The information set forth in Item 2.01 is incorporated herein by reference.
On December 19, 2012 (the "Closing Date"), pursuant to the previously announced purchase and sale agreement, dated September 27, 2012 (the "Purchase Agreement"), by and between Capital Trust, Inc. ("Capital Trust") and Huskies Acquisition LLC (the "Purchaser"), an affiliate of The Blackstone Group L.P. ("Blackstone"), and the Assignment Agreement, dated as of the Closing Date (the "Assignment Agreement" and, together with the Purchase Agreement, the "Transaction Agreements"), by and among Capital Trust, the Purchaser and Blackstone Holdings III L.P., an affiliate of Blackstone ("Holdings III"), Capital Trust completed (i) the disposition of its investment management and special servicing business, including CT Investment Management Co., LLC ("CTIMCO") and related private investment fund co-investments for a purchase price of $21,424,028 to the Purchaser and Holdings III (the "Investment Management Business Sale"), and (ii) the sale to Holdings III of 5,000,000 shares (the "New CT Shares") of Capital Trust's class A common stock, par value $0.01 per share (the "Common Stock"), for a purchase price of $10,000,000 (the "Purchaser Investment").
Pursuant to the Transaction Agreements, Capital Trust sold to the Purchaser and Holdings III:
• all of the issued and outstanding limited liability company interests in CTIMCO, through which Capital Trust operated its investment management and special servicing business;
• all of the issued and outstanding limited liability company interests in CT High Grade Partners II Co-Invest, LLC, the entity through which Capital Trust co-invested as a non-managing member of CT High Grade Partners II, LLC, an investment fund managed by CTIMCO; and
• all 100 outstanding shares of class A preferred stock of CT Legacy REIT Mezz Borrower, Inc.
The foregoing description of the Transaction Agreements, Investment Management Business Sale and the Purchaser Investment does not purport to be complete and is qualified in its entirety by reference to the complete terms of the Purchase Agreement and the Assignment Agreement, copies of which are filed as Exhibits 2.1 and 10.2 to this Current Report, respectively, and incorporated herein by reference.
Special Dividend of $2.00 Per Share
Capital Trust paid the previously announced $2.00 per share special cash dividend on December 20, 2012. Pursuant to the New York Stock Exchange's "due bills" trading procedure, holders of Common Stock (other than those shares newly issued to Blackstone) at the close of business on the December 20, 2012 are entitled to receive the dividend payment, and the common stock began to trade ex-dividend on December 21, 2012.
. . .
The information set forth in Item 5.03 below is incorporated herein by reference.
Appointment of New Directors and Resignation of Messrs. Zell and Hyman.
In accordance with the terms of the Purchase Agreement, upon the Closing Date, the Board, upon the recommendation of the Board's Corporate Governance Committee, appointed Messrs. John G. Schreiber and Michael B. Nash to the Board. Mr. Schreiber was also appointed as Chairman of the Board.
Mr. Schreiber, age 66, is the President of Centaur Capital Partners, Inc. and a Partner and Co-Founder of Blackstone Real Estate Advisors. Mr. Schreiber has overseen all of Blackstone's real estate investments since 1992. Previously, Mr. Schreiber served as Chairman and Chief Executive Officer of JMB Urban Development Co. and Executive Vice President of JMB Realty Corp. Mr. Schreiber is a past board member of Urban Shopping Centers, Inc., Host Hotels & Resorts, Inc., The Rouse Company and AMLI Residential Properties Trust and he currently serves on the board of General Growth Properties, Inc., JMB Realty Corp. and a number of mutual funds managed by T. Rowe Price Associates. Mr. Schreiber graduated from Loyola University of Chicago and received an MBA from Harvard Business School.
Mr. Nash, age 51, is a Senior Managing Director of Blackstone and the Chief Investment Officer of Blackstone Real Estate Debt Strategies. He is also a member of the Real Estate Investment Committee for both Blackstone Real Estate Debt Strategies and Blackstone Real Estate Advisors. Mr. Nash graduated from State University of New York at Albany and received an MBA from the Stern School of Business at New York University.
Upon the Closing (as defined in the Purchase Agreement), Messrs. Samuel Zell, the Chairman of the Board prior to the Closing, and Edward S. Hyman resigned as members of the Board. In recognition of Mr. Zell's longstanding service as Chairman of the Board, upon the recommendation of the Board's Compensation Committee, Capital Trust provided Mr. Zell with a retirement payment in the amount of $75,000.
Executive Compensation
On December 17, 2012, the Compensation Committee of the Board approved 2012 annual cash bonuses payable to Capital Trust's named executive officers pursuant to the terms of the Performance-Based Annual Cash Bonus Award Agreements previously entered into with each of Capital Trust's named executive officers. The cash bonuses awarded to the named executive officers consisted of: $813,917 payable to Stephen D. Plavin, Capital Trust's chief executive officer and president, $621,133 payable to Mr. Jervis and $378,350 payable to Mr. Ruffing.
Charter Amendment
Pursuant to the Purchase Agreement and as approved by Capital Trust's stockholders, on the Closing Date, Capital Trust amended its charter to include a provision which provides, among other things, subject to certain exceptions, that none of Blackstone or its affiliates, Capital Trust's directors or any person Capital Trust's directors control shall have any duty to refrain directly or indirectly from engaging in business opportunities or competing with Capital Trust (the "Charter Amendment").
The foregoing description of the Charter Amendment, filed with the Maryland State Department of Assessments and Taxation on December 19, 2012, is qualified in its entirety by reference to the complete terms of the Charter Amendment, which is filed as Exhibit 3.1 to this Current Report and incorporated herein by reference.
Bylaw Amendment
Effective on the Closing Date, Capital Trust amended and restated its bylaws (the "Bylaws Amendment") to: (i) provide that the Board shall be comprised of no more than eight members unless agreed to in writing by the Purchaser and (ii) in the event that a vacancy in the Board or committee of the Board is created at any time by the death, disability, retirement or removal of a director designated by the Purchaser pursuant to the Purchase Agreement, the Purchaser has the right to designate an individual as a replacement director to fill such vacancy, subject to the Maryland General Corporation Law and the rules of the New York Stock Exchange.
The foregoing description of the Bylaws Amendment is qualified in its entirety by reference to the complete terms of the Bylaws Amendment, which is filed as Exhibit 3.2 to this Current Report and incorporated herein by reference.
Effective on the Closing Date, the Board adopted a new Code of Business Conduct and Ethics (the "Code") that applies to all of Capital Trust's directors, officers and employees. The new Code takes into account that Capital Trust is now externally managed and covers topics such as business ethics, compliance standards and procedures, confidential information, conflicts of interest, corporate opportunities, protection and proper use of Capital Trust's assets, fair dealing, compliance with laws and insider trading, public disclosure, international business laws and waivers of the Code, among others.
The foregoing description of the Code is qualified in its entirety by reference to the full text of the new Code, a copy of which is filed as Exhibit 14.1 to this Current Report and is incorporated by reference. The amended Code is posted on Capital Trust's website at www.capitaltrust.com under the "Corporate Governance" subsection of the "Investor Relations" tab.
On December 19, 2012, Capital Trust held a special meeting of its stockholders (the "Special Meeting") in connection with the transactions contemplated by the Purchase Agreement. At the Special Meeting, stockholders considered and voted upon the following proposals to approve:
1. the Purchase Agreement, including the Investment Management Business Sale, pursuant to the terms and subject to the conditions contained in the Purchase Agreement;
3. the entry by Capital Trust into the New Management Agreement;
4. the Charter Amendment; and
5. the adjournment of the Special Meeting if necessary or appropriate to solicit additional proxies if there are insufficient votes to approve any of the foregoing proposals.
The following is a summary of the voting results for each matter presented to the stockholders:
Purchase Agreement and Investment Management Business Sale:
Votes For Votes Against Votes Abstained Broker Non-Votes 16,195,532 1,913,203 168,453 0
Purchaser Investment:
Votes For Votes Against Votes Abstained Broker Non-Votes 16,287,163 1,957,949 32,076 0
New Management Agreement:
Votes For Votes Against Votes Abstained Broker Non-Votes 16,324,121 1,918,487 34,580 0
Charter Amendment:
Votes For Votes Against Votes Abstained Broker Non-Votes 16,294,422 1,950,218 32,548 0
Adjournment of the Special Meeting (if necessary):
Votes For Votes Against Votes Abstained Broker Non-Votes 15,941,499 2,274,302 61,387 0
On December 19, 2012, Capital Trust issued a press release announcing the Closing. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
The Exhibit Index appearing after the signature page of this Current Report is incorporated herein by reference.
As a smaller reporting company, Capital Trust is not required to include pro forma financial information for the Investment Management Business Sale in this Current Report.
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