Exhibit 10.1


 


AGREEMENT


 


This agreement is made and entered on December 30, 2008 by and
among SL Green Operating Partnership, L.P., a Delaware limited partnership (“SLG
OP”), GKK Manager LLC, a Delaware limited liability company and a
majority-owned subsidiary of SLG OP (the “Manager”), GKK Capital LP, a Delaware
limited partnership (the “Partnership”) and Gramercy Capital Corp., a Maryland
corporation (“GKK”) and the sole general partner of the Partnership.  All capitalized terms used herein but not
otherwise defined shall have the meaning ascribed to such terms in the Third
Amended and Restated Agreement of Limited Partnership of the Partnership (as
amended, the “Partnership Agreement”).


 


WHEREAS, GKK,
SLG OP, the Manager and the Holders of the Class B Units are parties to
the Partnership Agreement;


 


WHEREAS, in
2008 the Partnership distributed for the account of the Class B Units an
aggregate of approximately $5.1 million pursuant to Section 5.1(c) of
the Partnership Agreement;


 


WHEREAS, the
Manager acts as the external manager of GKK pursuant to the Second Amended and
Restated Management Agreement between the Manager and GKK (as amended);


 


WHEREAS, SLG
OP and GKK have been negotiating the potential internalization of the
operations of the Manager into GKK (the “Internalization”);


 


WHEREAS, the
transactions contemplated by this Agreement have been approved by a special
committee of disinterested directors of SL Green Realty Corp. and GKK; and


 


WHEREAS, the
Partnership, the Manager and the SLG OP now desire to enter into this Agreement
which modifies their respective rights and obligations to each other in respect
of certain distributions under the Partnership Agreement on the terms and
conditions set forth herein.


 


NOW THEREFORE,
in consideration of the mutual agreements herein set forth, the parties hereto
agree as follows:


 


Section 1.               Class B Unit Distributions.  In full satisfaction of all potential
obligation that the Holders of the Class B Units may have to the
Partnership, and that the Partnership may have to the Holders of the Class B
Units, in each case under Section 5.01.C of the Partnership Agreement, in
respect of the recalculation of the distribution amount at the end of the 2008
calendar year,  (i) the Manager is
paying to the Partnership $2.75 million in cash simultaneously with the
execution of this Agreement and (ii) SLG OP hereby transfers to GKK, and
GKK hereby acquires from SLG OP, 1.9 million shares of common stock of GKK,
consisting of (x) 265,000 shares that were acquired on August 2,
2004, at the price of $13.95 per share, (y) 1,275,000 shares that were
acquired on January 3, 2005, at the price of $17.27 per share, and (z) 360,000
shares that were acquired on January 14, 2005, at the price of $25.80 per
share.  GKK and the Partnership agree to
use commercially reasonable efforts to assist SLG OP in obtaining the
acknowledgement by the Bank of New York Mellon, as transfer agent for the
common stock of GKK, of such transfer of common stock of GKK.


 


Section 2.               Internalization.  The
parties acknowledge and agree (i) to continue to negotiate the potential
Internalization in good faith and (ii) that any such Internalization is
subject to the consent of certain lenders of GKK and its subsidiaries. GKK and
the Partnership agree to use their commercially reasonable efforts to obtain
the consents of such lenders.


 

















 


Section 3.               Governing Law.  THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.


 


Section 4.               Counterparts.  This
Agreement may be executed in any number of counterparts, each of which shall be
deemed to be an original as against any party whose signature appears thereon,
and all of which shall together constitute one and the same instrument.  This Agreement shall become binding when one
or more counterparts of this Agreement, individually or taken together, shall
bear the signatures of all of the parties reflected hereon as the signatories.


 


Section 5.               Third-Party Beneficiaries.  Other than the Holders of the Class B
Units (which are third party beneficiaries of this Agreement) and the parties
hereto, no other person shall have any rights hereunder, nor shall any other
person be entitled to rely upon the terms contained herein.


 


Section 6.               Waiver of Jury Trial.  EACH OF THE PARTIES HERETO WAIVES ANY RIGHTS
IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION RELATING TO
THIS AGREEMENT.  THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES
HERETO TO ENTER INTO THIS AGREEMENT.


 


Section 7.               Expenses.  Each
party will pay its own costs and expenses incurred in connection with the
negotiation of this Agreement, and the consummation of the transactions
contemplated by this Agreement.


 


Section 8.               Entire
Agreement.  This Agreement sets forth the entire understanding of the
parties hereto with respect to the subject matter hereof and supersedes all
prior agreements, written or oral, between them as to such subject matter.


 

















 


IN WITNESS
WHEREOF, the parties hereto have executed this Agreement as of the date first
written above.


 


	
   

  	
   

  	
   

  	
  GKK CAPITAL LP

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  GKK Capital Corp., its sole general partner

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Roger Cozzi

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Roger Cozzi

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  GRAMERCY CAPITAL CORP.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Roger Cozzi

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Roger Cozzi

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  SL GREEN OPERATING PARTNERSHIP, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  SL Green Realty Corp., its sole general
  partner

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Marc Holliday

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Marc Holliday

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  GKK MANAGER LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  GKK Manager Member Corp., its managing

  member

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Marc Holliday

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Marc Holliday

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Chief Executive Officer