Document:

TERMINATION AGREEMENT

         This TERMINATION AGREEMENT (this "Agreement") is made as of March 8,
2000 between and among Capital Trust, Inc., a Maryland corporation and successor
to Capital Trust, a California business trust ("CT"), 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 in the Co-Investment Agreement (as defined below)) (collectively, the
"Co- Investors").

                              Preliminary Statement

                  A. CT and the Co-Investors are parties to that certain co-
investment agreement, dated as of July 28, 1998 (the "Co-Investment Agreement").
The Co-Investors own the entire liquidation amount of 8.25% step up convertible
trust preferred securities issued by CT's consolidated statutory trust
subsidiary, CT Convertible Trust I ("CT Trust"), a Delaware statutory business
trust (the "Trust Preferred Securities").

                  B. CT and certain of its affiliates and certain affiliates of
Citigroup Investments Inc., a Delaware corporation, have entered into that
certain venture agreement, dated as of the date hereof (the "Venture
Agreement"), pursuant to which, among other things, the parties thereto will
co-sponsor, commit to invest capital in and manage real estate mezzanine
investment opportunity funds, provided however, that CT and the Co-Investors
enter into this Agreement with respect to the termination of the Co-Investment
Agreement.

                  C. CT has requested that each of the Co-Investors agree to
terminate the Co-Investment Agreement. The Co-Investors are willing to do so in
consideration of the benefits to CT and its business arising from the Venture
Agreement and the transactions governed thereby and described therein.

                  D. CT and the Co-Investors desire to terminate the
Co-Investment Agreement as of the date hereof.

                  NOW, THEREFORE, in consideration of the mutual covenants
contained herein and other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, it is agreed as follows:

913048.6

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                  1. From and after the date hereof (the "Termination Date"),
subject to the conditions set forth herein, and subject to the issuance of
$89,742,000 liquidation amount of step up convertible trust preferred securities
and $60,258,000 of step up non-convertible trust preferred securities by CT
Trust in exchange for the Trust Preferred Securities, the Co-Investment
Agreement is hereby cancelled and terminated and is of no further force or
effect. The parties hereto hereby mutually release each other from all of their
respective obligations and liabilities under the Co-Investment Agreement whether
accrued prior to, or accruing from and after, the Termination Date.

                  2. Each of the parties has full power and authority to execute
and deliver this Agreement and to consummate the transactions contemplated
hereby.

                  3. This Agreement shall be binding upon the parties hereto,
their affiliates, successors and assigns.

                  4. This Agreement shall be construed and enforced in
accordance with the laws of the State of New York, without regard to principles
of conflicts of laws.

                  5. This Agreement may be executed in several counterparts and
all so executed shall constitute one agreement binding on all parties hereto,
notwithstanding that all parties have not signed the original or the same
counterpart, except that no counterpart shall be binding unless a counterpart
has been signed by all parties.

                         [Remainder of Page Left Blank]

913048.6

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

                         CAPITAL TRUST INC.

                         By:      /s/ John R. Klopp
                                  Name:  John R. Klopp
                                  Title: Chief Executive Officer

                         VORNADO REALTY L.P.

                         By:      Vornado Realty Trust, its general
                                             partner

                                  By:     /s/ Irwin Goldberg
                                          Name:  Irwin Goldberg, Vice President
                                          Title: Chief Financial Officer

                         EOP OPERATING LIMITED PARTNERSHIP

                         By:   Equity Office Properties Trust, its general
                                   partner

                               By:   /s/ Peter B. Kisluk
                                     Name:  Peter B. Kisluk
                                     Title: Vice President

                         GENERAL MOTORS INVESTMENT
                         MANAGEMENT CORPORATION

                         By:   /s/ Thomas Dobrowski
                               Name:  Thomas Dobrowski
                               Title: Managing Director

913048.6MODIFICATION AGREEMENT

                  MODIFICATION AGREEMENT, dated as of May 10, 2000, by and among
Capital Trust, Inc., a Maryland corporation and successor to Capital Trust, a
California business trust (the "Company"), John R. Klopp and Sheli Z. Rosenberg
(the "Regular Trustees"), as Regular Trustees for CT Convertible Trust I, a
Delaware statutory business trust and consolidated subsidiary of the Company
(the "Trust"), Vornado Realty L.P., a Delaware limited partnership ("VNO"),
Vornado Realty Trust, a Maryland real estate investment trust that has elected
to be treated as a real estate investment trust for federal income tax purposes
("VRT"), EOP Operating Limited Partnership, a Delaware limited partnership
("EOP"), Equity Office Properties Trust, a Maryland real estate investment trust
that has elected to be treated as a real estate investment trust for federal
income tax purposes ("EOPT"), and State Street Bank and Trust Company, as
trustee for General Motors Employes Global Group Pension Trust, a New York trust
and successor to both General Motors Hourly-Rate Employes Pension Trust, a New
York trust, and General Motors Salaried Employes Pension Trust, a New York trust
("GM Trust").

                              Preliminary Statement

                  A. VNO, EOP and GM Trust are the holders ("CTP Holders") of an
aggregate of $150,000,000 in liquidation amount of 8.25% step up convertible
trust preferred securities (the "CTP Securities") representing undivided
beneficial interests in the assets of the Trust, which was organized pursuant to
that certain declaration of trust, dated and effective as of July 28, 1998, by
the Company and the Trustees as defined therein and the holders, from time to
time, of undivided beneficial interests in the assets of the Trust (the
"Declaration"). The Company is the holder (the "CTC Holder",and together with
the CTP Holders, the "Holders") of $4,650,000 in liquidation amount of 8.25%
step up convertible trust common securities (the "CTC Securities," and together
with the CTP Securities, the "Securities") representing undivided beneficial
interests in the assets of the Trust. The Trust holds $154,650,000 in aggregate
principal amount of 8.25% step up convertible junior subordinated debentures due
September 30, 2018 (the "Convertible Debentures") issued pursuant to the
indenture, dated as of July 28, 1998, between the Company and Wilmington Trust
Company (the "Indenture").

                  B. Pursuant to the Declaration, the distribution rates and
distribution payment dates for the CTP Securities and the CTC Securities
correspond to the interest rates and interest payment dates of the Convertible
Debentures, and the CTP Holders have the power to direct the exercise of the
consent and voting rights of holders of Convertible Debentures in proportion to
the liquidation amount of the CTP Securities held by them.

                  C. The Company and certain of its affiliates and certain
affiliates of Citigroup Investments Inc., a Delaware corporation, are parties to
that certain venture agreement (the "Venture Agreement"), dated as of March 8,
2000, pursuant to which, among other things, the parties thereto will
co-sponsor, commit to invest capital in and manage real estate mezzanine
investment opportunity funds, provided however, that the parties hereto (i)
enter into a termination agreement that would terminate as of March 8, 2000 that
certain co-investment

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agreement, dated as of July 28, 1998, among the parties hereto and (ii) enter
into this Agreement with respect to the proposed amendments to the Indenture and
the Declaration that would modify the terms of the CTP Securities and the CTC
Securities to provide the Company with significantly greater flexibility with
regard to electing to be taxed as a REIT as required in the Venture Agreement.

                  D. The Company has requested that the CTP Holders provide
their consent, and the Company, as CTC Holder, intends to provide its consent,
to an amendment and restatement of each of the Indenture and the Declaration
that would modify the terms thereof in a manner to provide the Company with the
desired flexibility discussed above. The CTP Holders are willing to do so in
consideration of the benefits to the Company and its business arising from the
Venture Agreement and the transactions governed thereby and the benefits of
certain modifications to the terms of the CTP Securities that are favorable to
the CTP Holders.

                  Accordingly, the parties hereto agree as follows:

                                    ARTICLE 1

                              AGREEMENT AND CLOSING

                  Section 1.1 Agreement. Subject to the conditions contained
herein:

                  (a) The Company hereby agrees to execute the amended and
restated indenture in the form attached hereto as Exhibit A (the"Amended and
Restated Indenture") and deliver the same to the Trustee as defined in the
Indenture (the "Indenture Trustee") at the Closing.

                  (b) The Company hereby agrees to issue pursuant to the terms
of the Amended and Restated Indenture, upon execution and delivery thereof by
the parties thereto, to the Declaration Institutional Trustee Debentures (as
defined herein) in the aggregate principal amount of $154,650,000 (the "New
Debentures") against delivery of the Convertible Debentures to the Indenture
Trustee for cancellation.

                  (c) The Regular Trustees hereby agree to execute the amended
and restated declaration of trust in the form attached hereto as Exhibit B (the
"Amended and Restated Declaration") and to deliver the same to the Institutional
Trustee as defined in the Declaration (the "Declaration Institutional Trustee")
and the Delaware Trustee as defined in the Declaration (the "Declaration
Delaware Trustee") at the Closing.

                  (d) Each CTP Holder and the Company, as the CTC Holder, hereby
agrees to execute a written direction in the form attached hereto as Exhibit C
(the "Written Direction"), directing the Declaration Institutional Trustee to
execute a written consent to the Amended and Restated Indenture (the "Indenture
Consent") in the form attached hereto as Exhibit D and to deliver such Written
Direction to the Declaration Institutional Trustee at the Closing.

                  (e) Each CTP Holder and the Company, as the CTC Holder, hereby
agrees to execute a written consent in the form attached hereto as Exhibit E to
the Amended and

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Restated Declaration (the "Declaration Consent") and to deliver the same to the
Declaration Institutional Trustee and the Declaration Delaware Trustee at the
Closing.

                  (f) The Company shall request the Indenture Trustee to join
the Company in the execution of the Amended and Restated Indenture and, in
connection therewith, shall comply with Sections 8.2, 8.4 and 15.5 of the
Indenture and, without limitation, deliver to the Indenture Trustee at the
Closing:

                           (i) certified copies of resolutions of the board of
         directors of the Company, in the form attached hereto as Exhibit F (the
         "Indenture Resolutions"), authorizing the execution of the Amended and
         Restated Indenture;

                           (ii) an officers' certificate in the form attached
         hereto as Exhibit G (the "Indenture Officers' Certificate"); and

                           (iii) an opinion of counsel in the form attached
         hereto as Exhibit H (the "Opinion of Counsel");

and take any and all action on its part necessary to accomplish the same.

                  (g) The Regular Trustees shall request the Declaration
Institutional Trustee and the Declaration Delaware Trustee to join the Regular
Trustees in the execution of the Amended and Restated Declaration and, in
connection therewith, shall comply with Sections 3.7(a)(vii), 3.10(a) and 12.1
of the Declaration and Section 8(b) of Annex I to the Declaration and, without
limitation, deliver to the Declaration Institutional Trustee, the Declaration
Delaware Trustee and, as required, the Trust at the Closing:

                           (i) an officers' certificate, signed by two officers
         of the Company, in the form attached hereto as Exhibit I (the
         "Declaration Company Officers' Certificate");

                           (ii) an officers' certificate, signed by the Regular
         Trustees, in the form attached hereto as Exhibit J (the "Declaration
         Trust Officers' Certificate");

                          (iii) the Opinion of Counsel;

and take any and all action on their part necessary to accomplish the same.

                  (h) The Regular Trustees shall request the Declaration
Institutional Trustee as the holder of the Convertible Debentures to (i) consent
to the Amended and Restated Indenture and, in connection therewith, shall comply
with Section 3.7(a)(vii) of the Declaration and Section 8(b) of Annex I to the
Declaration and, without limitation, deliver to the Declaration Institutional
Trustee and the Trust at the Closing an opinion of tax counsel in the form
attached hereto as Exhibit K (the "Tax Opinion") and (ii) deliver at the Closing
to the Indenture Trustee for cancellation the Convertible Debentures against
delivery of the New Debentures issued to it in accordance with the terms hereof.

                  (i) The Declaration Trustees hereby agree to cause the Trust
to issue, pursuant to the terms of the Amended and Restated Declaration, upon
execution and delivery thereof by the parties thereto at the Closing, (i) to
each CTP Holder Convertible Preferred

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Securities (as defined therein) (the "New CTP Securities") in the aggregate
liquidation amount of $50,000,000 (for a total, to all CTP Holders, of
$150,000,000 in liquidation amount) and (ii) to the Company Common Securities
(as defined therein) in the aggregate liquidation amount of $4,650,000 ("New CTC
Securities").

                  (j) Each CTP Holder hereby, severally and not jointly, agrees
to deliver at the Closing to the Declaration Institutional Trustee for
cancellation the CTP Securities held by it against delivery of the New CTP
Securities issued to it in accordance with the terms hereof. The Company, as the
CTC Holder, hereby agrees to deliver at the Closing to the Declaration
Institutional Trustee for cancellation the CTC Securities held by it against
delivery of the New CTC Securities issued to it in accordance with the terms
hereof.

                  (k) The Regular Trustees hereby agree to deliver written
notice of the Amended and Restated Declaration as executed to the Holders in the
form attached hereto as Exhibit L (the "Amended and Restated Declaration
Notice").

                  (l) The Company hereby agrees to execute and deliver at the
Closing, and to request that Wilmington Trust Company, as trustee, execute and
deliver at the Closing, an amended and restated preferred securities guarantee
agreement for the benefit of the holders, from time to time, of the New CTP
Securities, in the form attached hereto as Exhibit M (the "New Preferred
Securities Guarantee").

                  (m) The Company hereby agrees to execute and deliver at the
Closing an amended and restated common securities guarantee agreement for the
benefit of the holders, from time to time, of the New CTC Securities, in the
form attached hereto as Exhibit N (the "New Common Securities Guarantee").

                  Section 1.2 Closing. The execution and delivery of the
documents and the other actions referred to in Section 1.1 (the "Closing") shall
take place at the offices of Battle Fowler LLP, 75 East 55th Street, New York,
New York 10022 at 10:00 a.m. on the date hereof (the "Closing Date").

                  Section 1.3 Conditions to Closing. (a) The obligation of the
Company and the Trust to close the transactions contemplated hereunder is
subject to the satisfaction on or prior to the Closing of the following
conditions:

                           (i) no order, injunction or decree issued by any
         court or agency of competent jurisdiction or other legal restraint or
         prohibition preventing the consummation of the closing of the
         transactions contemplated by this Agreement shall be in effect;

                           (ii) each of the terms, covenants and conditions of
         this Agreement to be complied with and performed by the CTP Holders on
         or prior to the Closing shall have been duly complied with and
         performed in all material respects, and all documents to be delivered
         or actions to be taken by the CTP Holders shall have been delivered or
         performed; and

                           (iii) each of the representations and warranties made
         by the CTP Holders herein shall be true and correct in all material
         respects as of the Closing Date

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         (unless such representation and warranty is made as of a specific date
         and then shall be true and correct as of such date).

                  (b) The obligation of the CTP Holders to close the
transactions contemplated hereunder is subject to the satisfaction on or prior
to the Closing of the following conditions:

                           (i) no order, injunction or decree issued by any
         court or agency of competent jurisdiction or other legal restraint or
         prohibition preventing the consummation of the closing of the
         transactions contemplated by this Agreement shall be in effect;

                           (ii) each of the terms, covenants and conditions of
         this Agreement to be complied with and performed by the Company, in its
         capacity as the CTC Holder and otherwise, and the Trust on or prior the
         Closing shall have been duly complied with and performed in all
         material respects, and all documents to be delivered or actions to be
         taken by the Company, in its capacity as the CTC Holder and otherwise,
         and the Trust shall have been delivered or performed;

                           (iii) each of the representations and warranties made
         by the Company and the Trust herein shall be true and correct in all
         material respects as of the Closing Date (unless such representation
         and warranty is made as of a specific date and then shall be true and
         correct as of such date);

                           (iv) the Declaration Institutional Trustee shall have
         executed and delivered to the Indenture Trustee the Indenture Consent;

                           (v) the Indenture Trustee shall have executed and
         delivered to the Company the Amended and Restated Indenture;

                           (vi) the Declaration Institutional Trustee and the
         Declaration Delaware Trustee shall have executed and delivered to the
         Company the Amended and Restated Declaration;

                           (vii) the Company and Wilmington Trust Company, as
         trustee, shall have executed and delivered to the CTP Holders the New
         Preferred Securities Guarantee;

                           (viii) the Company shall have executed and delivered
         to the CTC Holder the New Common Securities Guarantee;

                           (ix) Richards, Layton and Finger shall have delivered
         an opinion, dated the Closing Date, in the form attached hereto as
         Exhibit O;

                           (x) Battle Fowler LLP shall have delivered an
         opinion, dated the Closing Date, in the form attached hereto as Exhibit
         P; and

                           (xi) Ballard Spahr Andrews and Ingersoll shall have
         delivered an opinion, dated the Closing Date, in the form attached
         hereto as Exhibit Q.

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                  Section 1.4 Closing Deliveries and Actions. At the Closing,
the following deliveries shall be made:

                  (a) The Company shall deliver to the Institutional Trustee the
Amended and Restated Indenture executed by the Company.

                  (b) The Regular Trustees shall deliver to the Declaration
Institutional Trustee and the Declaration Delaware Trustee the Amended and
Restated Declaration executed by the Regular Trustees.

                  (c) Each CTP Holder and the Company, as the CTC Holder, shall
deliver to the Declaration Institutional Trustee a Written Direction executed by
each such CTP Holder and the Company.

                  (d) Each CTP Holder and the Company, as the CTC Holder, shall
deliver to the Declaration Institutional Trustee and the Declaration Delaware
Trustee a Declaration Consent executed by each such CTP Holder and the Company.

                  (e) The Company shall deliver to the Indenture Trustee the
Indenture Resolutions, the Indenture Officers' Certificate and the Opinion of
Counsel.

                  (f) The Regular Trustees shall deliver to the Declaration
Institutional Trustee, the Declaration Delaware Trustee and, as appropriate, the
Trust the Declaration Company Officers' Certificate, the Declaration Trust
Officers' Certificate, the Opinion of Counsel and the Tax Opinion and shall
deliver to each Holder the Amended and Restated Declaration Notice.

                  (g) The Company shall deliver to the Declaration Institutional
Trustee $154,650,000 aggregate principal amount of New Debentures duly
registered in its name.

                  (h) The Trust shall deliver $50,000,000 in liquidation amount
of New CTP Securities, duly registered in their respective names, to each CTP
Holder and $4,650,000 in liquidation amount of New CTC Securities duly
registered in its name to the Company.

                  (i) There shall have been delivered to each CTP Holder the
opinions referred to in Section 1.3(b)(ix), (x) and (xi).

                                    ARTICLE 2

                         REPRESENTATIONS AND WARRANTIES
                          OF THE COMPANY AND THE TRUST

                  The Company and the Regular Trustees, jointly and severally,
represent and warrant to the CTP Holders, as of the Closing Date, as follows:

                  Section 2.1 Existence and Authority of the Company. The
Company is a corporation duly incorporated and validly existing under and by
virtue of the laws of the State of

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Maryland and is in good standing with the State Department of Assessments and
Taxation of Maryland. The Company has the requisite corporate power to execute
and deliver this Agreement, the Amended and Restated Indenture and the Amended
and Restated Declaration and to carry out the terms and conditions hereof and
thereof applicable to it. The Company is duly qualified to transact business and
is in good standing in each jurisdiction in which such qualification is
necessary, except to the extent that the failure to so qualify or be in good
standing would not have a material adverse effect on the management, assets,
business, business prospects, earnings or condition (financial or otherwise) of
the Company. The execution, delivery and performance by the Company of this
Agreement, the Amended and Restated Indenture and the Amended and Restated
Declaration have been duly authorized by all necessary corporate action on the
part of the Company. This Agreement has been duly executed and delivered, and
the Amended and Restated Indenture and the Amended and Restated Declaration,
when delivered to the Indenture Trustee, will have been duly executed, on behalf
of the Company, and assuming due execution of this Agreement by each CTP Holder,
due execution of the Amended and Restated Indenture by the Indenture Trustee,
and due execution of the Amended and Restated Declaration by the Declaration
Institutional Trustee and the Declaration Delaware Trustee, this Agreement
constitutes, and the Amended and Restated Indenture and the Amended and Restated
Declaration will constitute, valid and legally binding obligations of the
Company, enforceable against the Company in accordance with their terms, except
to the extent that their enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws relating to or affecting
creditors' rights generally and by general equitable principles ("Bankruptcy
Exceptions").

                  Section 2.2 Existence and Authority of the Trust. The Trust
has been duly created and is validly existing and in good standing as a business
trust under Delaware law with the trust power and authority to own its
properties and to conduct its business and to enter into and perform its
obligations under this Agreement and the Amended and Restated Declaration. The
Trust is duly qualified to transact business and is in good standing in each
jurisdiction in which such qualification is necessary, except to the extent that
the failure to so qualify or be in good standing would not have a material
adverse effect on the management, assets, business, business prospects, earnings
or condition (financial or otherwise) of the Trust. The Trust is and will, upon
consummation of the transactions contemplated hereby, be classified under
current law for United States federal income tax purposes as a grantor trust and
not as an association taxable as a corporation. The execution, delivery and
performance of this Agreement and the consummation by the Trust of the
transactions contemplated hereby have been duly authorized by all necessary
proceedings on the part of the Trust. This Agreement has been duly executed and
delivered on behalf of the Trust , and assuming due execution of this Agreement
by each CTP Holder, constitute a valid and legally binding obligation of the
Trust, enforceable against the Trust in accordance with its terms, except to the
extent that their enforceability may be limited by Bankruptcy Exceptions.

                  Section 2.3 No Consents, Approvals, Violations or Breaches.
Neither the execution and delivery by the Company and the Trust of this
Agreement and the other agreements to be executed and delivered pursuant hereto,
nor the consummation by the Company and the Trust of the transactions
contemplated hereby and thereby, will (i) require any consent, approval,
authorization or permit of, or filing, registration or qualification with or
notification to, any governmental or regulatory authority under any law of the
United States, any state or any political subdivision thereof ("Governmental
Entity"), (ii) violate any statute, law, ordinance, rule or regulation of the
United States, any state or any political subdivision thereof,

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<PAGE>

or any judgment, order, writ, decree or injunction applicable to the Company or
the Trust or any of their respective properties or assets or (iii) violate,
conflict with or result in a material breach of any provisions of, or constitute
a material default (or any event which, with or without due notice or lapse of
time, or both, would constitute a material default) under, or result in the
termination of, or accelerate the performance required by, any of the terms,
conditions or provisions of any charter, by-laws, declaration of trust, note,
bond, mortgage, indenture, deed of trust, license, lease, agreement or other
instrument or obligation to which the Company or the Trust is a party or by
which any of their properties or assets may be bound.

                  2.4      Private Offering

                  (a) None of the Company, the Trust, their affiliates (as such
term is defined in Rule 501(b) under the Securities Act for any person or
entity) ("Affiliates"), or any person acting on their or any of their
Affiliates' behalf has engaged, or will engage, in connection with the proposed
amendment and restatement of the Indenture and the Declaration, in any
communication or other form of general solicitation or general advertising
within the meaning of Rule 502(c) under the Securities Act of 1933, as amended
(the "Securities Act"). Based in part upon the representations of the CTP
Holders set forth in Section 3.1, the proposed amendment and restatement of the
Indenture and the Declaration in the manner contemplated by this Agreement is
exempt from the registration and prospectus delivery requirements of the
Securities Act, and the New CTP Securities are exempt from registration and
qualification under the registration, permit or qualification requirements of
all applicable state securities laws.

                  2.5      Payments Current

                  (a) The Company has paid to the Trust all interest accrued on
the Convertible Debentures through the date hereof except for accrued interest
to be paid pursuant to Section 5.1 hereof, and the Trust, upon receipt of such
interest payments, has paid to the CTP Holders all distributions accrued on the
CTP Securities through the date hereof except for accrued distributions to be
paid pursuant to Section 5.1 hereof.

                                   ARTICLE 3

                         REPRESENTATIONS AND WARRANTIES
                               OF THE CTP HOLDERS

                  Section 3.1 Certain Representation and Warranties. Each CTP
Holder, severally and not jointly, represents and warrants to the Company, as of
the Closing, as follows:

                  (a) It has acquired the CTP Securities and the New CTP
Securities for its own account for investment and not with a view towards the
resale, transfer or distribution thereof, nor with any present intention of
distributing the CTP Securities, but subject, nevertheless, to any requirement
of law that the disposition of such CTP Holder's property shall at all times be
within the CTP Holder's control, and without prejudice to the CTP Holder's right
at all times to sell or otherwise dispose of all or any part of such securities
under a registration under the Securities Act or under an exemption from said
registration available under the Securities Act.

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<PAGE>

                  (b) It has the power and authority to execute and deliver this
Agreement and to perform its obligations hereunder.

                  (c) It has taken all action necessary for the authorization,
execution, delivery, and performance of this Agreement by such CTP Holder and
its obligations hereunder, and, upon execution and delivery by the Company, this
Agreement shall constitute the valid and binding obligations of such CTP Holder,
enforceable against such CTP Holder in accordance with its terms, except as such
enforcement may be limited by Bankruptcy Exceptions.

                  (d) It has such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and risks of
amendment to its investment in the Trust and Company as contemplated by this
Agreement, and is able to bear the economic risk of such investment for an
indefinite period of time. It has been furnished access to such information and
documents as it has requested and has been afforded an opportunity to ask
questions of and receive answers from representatives of the Company and the
Trust concerning the terms and conditions of this Agreement and the proposed
amendments to the Indenture and Declaration contemplated hereby and the business
and financial condition of the Company and the Trust.

                  (e) It is an "accredited investor" as such term is defined in
Rule 501 under the Securities Act.

                  (g) It acknowledges that the CTP Securities and the New CTP
Securities have not been registered under the Securities Act and may not be
offered or sold within the United States, except pursuant to an exemption from,
or in a transaction not subject to, the registration requirements of the
Securities Act. It has not offered or sold, and will not offer or sell, the New
CTP Securities as amended pursuant hereto within the United States, except
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act.

                                    ARTICLE 4

                               FURTHER ASSURANCES

                  Section 4.1  Further Assurances.
                               ------------------

                  (a) Each party to this Agreement shall, at the request of
another party to this Agreement, at any time and from time to time following the
Closing hereunder, execute and de liver or cause to be executed and delivered
all such further instruments and take or cause to be taken all such further
action as may be reasonably necessary or appropriate in order to more
effectively carry out the provisions of this Agreement.

                  (b) Each of the CTP Holders shall, at the request of the
Company, at any time and from time to time following the Closing hereunder,
execute and deliver or cause to be executed and delivered all such further
instruments and take or cause to be taken all such action to further amend or
modify the Amended and Restated Declaration and the Amended and Restated
Indenture in such a manner as to eliminate any impediments to the Company's
ability to be taxed as a real estate investment trust ("REIT") under Section 857
of the Internal

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<PAGE>

Revenue Code of 1986, as amended (the "Code"), provided that such amendment(s)
or modification(s) do not adversely affect or impair the economic value of the
New CTP Securities (including the liquidity of such securities) held by such CTP
Holder; it being further agreed that a change in tax status to being taxed as a
REIT in and of itself shall not be deemed to impair the economic value of the
New CTP Securities in any manner. Notwithstanding the foregoing, none of GM
Trust, VNO or EOP shall be obligated in any manner (i) in the case of GM Trust,
to monitor or advise the Company as to whether GM Trust, or any entity in which
GM Trust is a direct or indirect owner, is a tenant, leaseholder or occupant of
any real property owned by the Company or is providing services to any such
tenant, leaseholder or occupant or to change GM Trust's ownership in any such
entity in any manner, and (ii) in the case of VNO and EOP, to monitor or advise
the Company as to whether VNO or EOP, or any entity of which either VNO or EOP
is a direct or indirect owner, or any entity which is a direct or indirect owner
of VNO or EOP, is a tenant, leaseholder, or occupant of any real property owned
by the Company or is providing services to any such tenant, leaseholder or
occupant or to change the ownership of VNO or EOP of any such entity or the
ownership of any such entity of VNO or EOP in any manner. Further, it is
understood that any changes to any charter or other organizational document
necessary to avoid becoming a "pension-held REIT" as defined in Section
856(h)(3)(D) of the Code pursuant to Section 5.3 hereof shall not be considered
in any manner to affect the economic value of the New CTP Securities (including
the liquidity of such securities) provided that such changes to the charter or
other organizational document do not void any equity ownership in the Company or
right to acquire equity ownership in the Company upon conversion of the CTP
Holders' New CTP Securities or limit any interest that any CTP Holder has in
equity ownership in the Company acquired or acquirable on conversion of such CTP
Holder's New CTP Securities including, without limitation, the right to vote,
the right to distributions and the right of appreciation in value with respect
to such equity ownership.

                                    ARTICLE 5

                              ADDITIONAL AGREEMENTS

                  Section 5.1 Accrued Distributions. The Company agrees to pay
on June 30, 2000 to the Trust the interest accrued on the Convertible Debentures
from April 1, 2000 to but not including the date hereof, and upon receipt
thereof, the Trust agrees to pay on June 30, 2000 to each of the Holders the
distributions accrued on their Securities from April 1, 2000 to but not
including the date hereof.

                  Section 5.2 VNO and EOP.

                  (a) The Company represents to VNO and its affiliates,
including VRT, and to EOP and its affiliates, including EOPT, that the Company's
board of directors has twelve members and the Company covenants, for the benefit
of VNO and its affiliates, including VRT, and of EOP and its affiliates,
including EOPT, that the number of seats on the Company's board of directors
will not be decreased without the prior written consent of VNO and EOP and that
any vacancy on the Company's board of directors will be filled in the ordinary
course pursuant to the Company's charter and by-laws.

                  (b) The Company covenants to VNO and its affiliates, including
VRT, and to EOP and its affiliates, including EOPT, that promptly upon request
by VRT or EOPT, or both of

915272.17
                                      -10-

<PAGE>

them made at any time after December 31, 2000 it will make a joint taxable REIT
subsidiary election (a "TRS" election) under Section 856(l) of the Code with
VRT, in the case of a request by VRT, and/or with EOPT, in the case of a request
by EOPT; provided, however, that:

                           (i) the Company shall not be required to make a TRS
         election, and VRT and EOPT, as the case may be, covenant that promptly
         upon request by the Company, they will join with the Company in
         revoking any previously made TRS election if the New CTP Securities
         owned by VRT or EOPT, as the case may be, represent less than 8% of the
         total voting power and value of the Company for purposes of clause
         (iii) of Section 856(c)(4)(B) of the Code;

                           (ii) in the event that the Internal Revenue Service
         takes the position that a TRS may not elect REIT status, then at such
         time as the Company determines that it will either merge into or
         otherwise combine with an existing REIT or elect REIT status at such
         time as the Company is not prohibited by Section 856(g) of the Code
         from electing REIT status, VRT and EOPT, as the case may be, covenant
         that promptly upon request by the Company, they will join with the
         Company in revoking any previously made TRS election (such revocation
         to be made at the time requested by the Company that will enable it to
         merge or otherwise combine with an existing REIT or reelect REIT
         status); provided however, that, if the Company fails to qualify as a
         REIT or otherwise is no longer taxed as a REIT, the Company shall again
         be subject to the covenant to make a TRS election contained in
         subsection 5.2(b) hereof; and

                           (iii) if at any time it appears, based on a TRS
         election and on the Company's business plan for its current or next
         subsequent tax year, that the Company will be prohibited by Section
         163(j) of the Code from taking an interest deduction for all or a
         portion of the interest to be paid by the Company to VRT or EOPT, as
         the case may be, in that year, or that the Company will otherwise
         suffer an actual economic loss from such election (except as a result
         of the covenants contained in subsection (c) of this Section), then VRT
         and EOPT, as the case may be, covenant that promptly upon request by
         the Company, they will join with the Company in revoking any previously
         made TRS election; provided further, however, that VRT and EOPT as the
         case may be shall not be required to join with the Company in revoking
         any previously made TRS election, and the Company shall not revoke such
         election, if VRT and EOPT agree to compensate the Company fully on an
         after tax basis for the value of the lost deduction for interest paid
         to them or compensate the Company fully for such economic loss.

                  (c) The Company covenants that it will not, directly or
indirectly, operate or manage a lodging facility or health care facility, or
provide to any person (under a franchise, license or otherwise) rights to any
brand name under which any lodging facility or health care facility is operated
at any time during any taxable year in which the Company has a TRS election
outstanding with respect to VRT or EOPT. Terms used in this Section have the
same meanings as when used in Section 856(l) of the Code or any successor
provision.

                  (d) The Company covenants that it shall provide VRT and EOPT
with such information as either of them shall reasonably request about the
capital structure, assets or activities of the Company in connection with
evaluating the effect of their investment in the New CTP Securities on their
REIT.

915272.17
                                      -11-

<PAGE>

                  (e) VRT and its affiliates and EOPT and its affiliates are
intended third party beneficiaries of the representations, covenants and
agreements of the Company set forth in this Section 5.2.

                  Section 5.3 GM Trust. The Company hereby agrees that without
the prior written consent of GM Trust, it shall not elect to become or
consummate a transaction in which the Company or any successor is or becomes
taxed as a REIT unless upon consummation of such election or transaction (i) the
Company or any such successor would not be or become a "pension-held REIT" as
defined in Section 856(h)(3)(D) of the Code, (ii) the Company or any such
successor shall have included in, or shall have amended to include in, its
charter or other organizational document provisions thereof that are
specifically intended to prevent the Company or any such successor from becoming
a "pension-held REIT" as defined in Section 856(h)(3)(D) of the Code and (iii)
the Company's charter or other organizational document does not void any equity
ownership in the Company or right to acquire equity ownership in the Company
upon conversion of GM Trust's New CTP Securities or limit any interest that GM
Trust has in equity ownership in the Company acquired or acquirable on
conversion of GM Trust's New CTP Securities including, without limitation, the
right to vote, the right to distributions and the right of appreciation in value
with respect to such equity ownership.

                  Section 5.4 Notice of Ownership Increases; Requested Ownership
Percentage; Irrevocable Proxy.

                  (a) Certain Corporation Actions. In the event that the Company
decides to undertake an action (such as redeeming a portion of its outstanding
capital stock) that causes an increase in the percentage of the Company's
outstanding voting capital stock or in the percentage of the value of all voting
and non-voting stock (determined after giving effect to the exercise or
conversion of all options, warrants and convertible securities owned by EOP and
its affiliates or VNO and its affiliates, as applicable, including Trust
securities) owned by EOP and its affiliates, or VNO and its affiliates, as
applicable, the Company shall notify EOP or VNO, as applicable, of such decision
at least ten (10) days prior to such action, which notice shall also state the
notice recipient's percentage ownership of voting stock and of value (as so
determined) as shown on the Company's books and records.

                  (b) Quarterly and Requested Ownership Reports. No later than
ten (10) days prior to the end of each calendar quarter and at any other time
upon the request of EOP or VNO, as applicable, the Company shall provide a
written statement to EOP or VNO, as applicable, setting forth (i) the percentage
of the Company's outstanding voting capital stock and the percentage of the
Company's outstanding value (as determined pursuant to Section 5.4(a)) shown on
the Company's books and records to be owned by EOP and its affiliates or VNO and
its affiliates, as applicable, and (ii) the total number and value of
outstanding shares of capital stock of the Company (separated by class and
series).

                  (c) Irrevocable Proxy. EOP hereby grants an irrevocable proxy
(subject to the last sentence of this subsection (c)) to the Company to vote or
act by written consent with respect to any and all Excess Shares owned by EOP
from time to time. EOP affirms that the proxy granted hereby is coupled with an
interest and shall be irrevocable. For purposes of this Section 5.4(c), the term
"Excess Shares" shall mean any Company securities owned by EOP and its
affiliates which exceeds 9.9% of the voting power or value of the Company for
purposes

915272.17
                                      -12-

<PAGE>

of clause (iii) of Section 856(c)(4)(B) of the Code. During the effectiveness of
any TRS election or while the Company is a REIT, this subsection (c) shall be of
no force and effect.

                  Section 5.5 Other. The Company and the Regular Trustees shall
treat the New Debentures as indebtedness for United States federal income tax
purposes.

                                    ARTICLE 6

                                  MISCELLANEOUS

                  Section 6.1 Assignment. This Agreement may not be assigned by
any party hereto without the prior written consent of each other party. This
Agreement shall be binding upon and inure to the benefit of the parties hereto,
their successors in interest and permitted assigns.

                  Section 6.2 Notices. All notices or other communications under
this Agreement shall be sufficient if in writing and delivered by hand or sent
by telecopy, or sent, postage prepaid by registered, certified or express mail,
or by recognized overnight air courier service and shall be deemed given when so
delivered by hand or telecopied, or if mailed or sent by overnight courier
service, on the third (3rd) business day after mailing (one business day in the
case of express mail or overnight courier service) to the parties at the
following addresses:

                  (a)      If to the CTP Holders, to:

                           Vornado Realty L.P.
                           c/o Vornado Realty Trust
                           Park 80 West, Plaza II
                           Saddle Brook, New Jersey 07663
                           Attention:   Joseph Macnow
                                        Executive Vice President,
                                        Finance and Administration
                           Facsimile:

                           with a copy to:

                           Sullivan & Cromwell
                           125 Broad Street
                           New York, New York 10004
                           Attention:  Alan J. Sinsheimer
                           Facsimile:  (212) 558-3588

                           EOP Operating Limited Partnership
                           Two North Riverside Plaza
                           Chicago, Illinois  60606
                           Attention: Stanley M. Stevens
                                         Richard D. Kincaid
                           Facsimile: (312) 559-5021

915272.17
                                      -13-

<PAGE>

                           with a copy to:

                           Neal, Gerber & Eisenberg
                           Two North LaSalle Street, Suite 2200
                           Chicago, Illinois 60602
                           Attention: Jonathan Wasserman
                           Facsimile: (312) 269-1747

                           State Street Bank and Trust Company, as trustee for
                           General Motors Employes
                           Global Group Pension Trust
                           225 Franklin Street
                           Boston, Massachusetts 02110
                           Attention: Michael Connors
                           Facsimile: (617) 537-6584

                           with a copy to:

                           Weil, Gotshal & Manges LLP
                           767 Fifth Avenue
                           New York, New York 10153
                           Attention: Gerald S. Backman, P.C.
                           Facsimile:  (212) 310-8007

                  (b)      If to the Company, to:

                           Capital Trust, Inc.
                           605 Third Avenue
                           26th Floor
                           New York, NY   10016
                           Attention: John R. Klopp
                           Chief Executive Officer
                           Facsimile: (212) 655-0044

                           with a copy to

                           Battle Fowler LLP
                           75 East 55th Street
                           New York, New York 10022
                           Attention: Thomas E. Kruger
                           Facsimile: (212) 856-7815

or to such other address as the addressee may have specified in a notice duly
given to the sender as provided herein.

                  Section 6.3 Entire Agreement. This Agreement, including the
Exhibits hereto, constitutes the entire understanding of the parties relating to
the subject matter hereof and supersedes all prior agreements and
understandings, whether oral or written. No amendment

915272.17
                                      -14-

<PAGE>

or modification of the terms of this Agreement shall be binding or effective
unless expressed in writing and signed by each party.

                  Section 6.4 No Waiver. The waiver by any party of the breach
of any of the terms and conditions of, or any right under, this Agreement shall
not be deemed to constitute the waiver of any other breach of the same or any
other term or condition or of any similar right. No such waiver shall be binding
or effective unless expressed in writing and signed by the party giving such
waiver.

                  Section 6.5 Costs and Expenses. Except as provided below, each
party to this Agreement shall bear its own respective costs and expenses
incurred in connection with the negotiation, preparation, execution, delivery
and enforcement of this Agreement and the consummation of the transactions
contemplated hereby. The Company shall reimburse each of VNO, EOP and GM Trust
for its reasonable out-of-pocket expenses incurred in connection with the
negotiation, preparation, execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby (including the fees and
expenses of Sullivan & Cromwell, counsel to VNO, Weil Gotshal & Manges LLP,
counsel to GM Trust, and Neal Gerber & Eisenberg, counsel to EOP).

                  Section 6.6 Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York applicable to
agreements executed and to be fully performed in such State.

                  Section 6.7 Counterparts. This Agreement may be executed in
one or more counterparts, each of which shall be deemed an original and all of
which together shall constitute one and the same instrument.

                  Section 6.8 Construction. The article and section headings
contained in this Agreement are inserted for reference purposes only and shall
not affect the meaning or interpretation of this Agreement.

915272.17
                                      -15-

<PAGE>

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

                 CAPITAL TRUST, INC., in its own capacity and as the
                 CTC Holder

                 By: /s/ John R. Klopp
                     Name:  John R. Klopp
                     Title: Chief Executive Officer

                 JOHN R. KLOPP

                 /s/ John R. Klopp
                 John R. Klopp, as Regular Trustee
                 Solely as trustee and not in his individual capacity

                 SHELI Z. ROSENBERG

                 /s/ Sheli Z. Rosenberg
                 Sheli Z. Rosenberg, as Regular Trustee
                 Solely as trustee and not in her individual capacity

                 EOP OPERATING LIMITED PARTNERSHIP

                 By: Equity Office Properties Trust,
                       its general partner

                          By:  /s/ Peter B. Kisluk
                               Name:  Peter B. Kisluk
                               Title: Vice President

                 EQUITY OFFICE PROPERTIES TRUST

                 By: /s/ Peter B. Kisluk
                          Name:  Peter B. Kisluk
                          Title: Vice President

915272.17
                                                       -16-

<PAGE>

                VORNADO REALTY L.P.

                By:      Vornado Realty Trust,
                         its general partner

                         By:  /s/ Irwin Goldberg
                              Name:  Irwin Goldberg, Vice President
                              Title: Chief Financial Officer

                VORNADO REALTY TRUST

                By: /s/ Irwin Goldberg
                    Name:  Irwin Goldberg, Vice President
                    Title: Chief Financial Officer

                STATE STREET BANK AND TRUST
                COMPANY, as trustee for
                General Motors Employes Global Group Pension Trust

                By: /s/ Cheryl A. Hopson
                    Name:  Cheryl A. Hopson
                    Title: Authorized Signatory

915272.17

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