EXHIBIT 99.1
PUT OPTION AGREEMENT
Dated as of June 23, 1999
by and among
Valley Fair University Towne Member LLC,
WEA Valley Fair UTC LLC,
and
Westfield America, Inc.
PUT OPTION AGREEMENT
This Put Option Agreement, dated as of June 23, 1999, (this
"Agreement") is entered into by and among Valley Fair University Towne
Member LLC ("VFUT"), a Delaware limited liability company, WEA Valley Fair
UTC LLC, a Delaware limited liability company ("WEA Valley Fair"), and
Westfield America, Inc., a Missouri corporation ("WEA").
W I T N E S S E T H
WHEREAS, VFUT and WEA Valley Fair, an affiliate of WEA, have
entered into the Limited Liability Company Agreement of Valley Fair UTC
LLC, dated as of June 23, 1999 (the "LLC Agreement");
WHEREAS, pursuant to the LLC Agreement, a Delaware limited
liability company known as Valley Fair UTC LLC (the "LLC") has been formed;
WHEREAS, VFUT and WEA Valley Fair are the sole members of the LLC
and collectively own all outstanding LLC Interests (as defined below); and
WHEREAS, in connection with the foregoing, and in consideration for
the payment by VFUT to WEA of $4,000,000, WEA has agreed to grant to VFUT
put options to require WEA to purchase (i) VFUT's LLC Interest and (ii) the
entire portion of the Distributed Interest (as defined below) distributed
to VFUT, on the terms herein described.
NOW, THEREFORE, in consideration of the foregoing and the covenants
of the parties set forth herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
Capitalized terms used herein shall have the following meaning:
"Adverse Economic Impact Period" shall mean each period in which
there shall be a material adverse economic impact to the value of a Mall
(provided such material adverse economic impact does not result from the
gross negligence or willful misconduct of WEA Valley Fair) resulting from:
(i) strikes or other labor difficulties, civil disturbance, order of any
court or governmental or regulatory body with jurisdiction, war, riot,
sabotage, the occurrence of a felony, embargo, disease, lightning,
earthquake, fire, storm, hurricane, tornado, flood, explosion or other acts
of God; (ii) the closing for business or bankruptcy, or the pending or
threatened closing for business or bankruptcy, of tenants or a retailer
doing business at a Mall; (iii) the announcement of the planned
construction or material renovation or expansion of a regional shopping
center (excluding Town & Country Village, located immediately to the south
of Valley Fair Mall, bordered by ▇▇▇▇▇▇ ▇▇▇▇▇▇ Boulevard and Winchester
Boulevard) that would reasonably be anticipated to have a primary trade
area that materially overlaps the primary trade area of a Mall; and (iv)
the discovery of an uninsured physical condition that was not required to
be insured against under the specific insurance coverages to be maintained
for such Mall set forth from time to time in the Annual Plan. No such
Adverse Economic Impact Period shall last longer than twelve months;
provided, however, that a new Adverse Economic Impact Period shall begin
(even though one or more Adverse Economic Impact Periods may then be in
effect) each time there shall be another material adverse economic impact
to the value of a Mall resulting from an event described in clauses (i)
through (iv) above.
"Affiliate" shall mean with respect to any Person, any other Person
directly or indirectly controlled by, controlling or under common control
with the Person in question.
"Agreement" shall have the meaning ascribed to such term in the
recitals.
"Annual Plan" shall have the meaning ascribed to such term in the
LLC Agreement as of the date hereof.
"Business Day" shall mean any day other than Saturday, Sunday or
any other day on which banks or savings and loan associations in New York
or California are not open for business.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Default Loan" shall have the meaning ascribed to such term in
Section 2.3 of the LLC Agreement as of the date hereof.
"Distributed Interest" shall have the meaning ascribed to such term
in Section 4.3 hereof.
"Expiration Time" shall mean 5:00p.m., New York City time, on June
30, 2029.
"FFO" shall mean net income (loss), computed in accordance with
generally accepted accounting principles, excluding gains (or losses) from
debt restructurings and sales of property, plus real estate related
depreciation and amortization and after adjustments for unconsolidated
partnerships and joint ventures.
"First Offer Transfer Notice" shall have the meaning ascribed to
such term in Section 8.4 of the LLC Agreement as of the date hereof.
"LLC" shall have the meaning ascribed to such term in the recitals.
"LLC Agreement" shall have the meaning ascribed to such term in the
recitals.
"LLC Agreement Notices" shall have the meaning ascribed to such
term in Section 2.3 hereof.
"LLC Assets" shall mean the assets and property, whether tangible
or intangible and whether real, personal, or mixed, at any time held for
the benefit of the LLC or either Owner LLC and all membership interests in
each Owner LLC.
"LLC FFO" shall mean the FFO of the LLC for the four (4) calendar
quarters used in calculating the applicable Put Multiple.
"LLC Interest" shall mean, as to any Member, all of the interest of
that Member in the LLC as set forth in the LLC Agreement including, without
limitation, such Member's (i) right to a distributive share of the profits
and losses and cash flow of the LLC, (ii) right to a distributive share of
LLC Assets and (iii) right to participate in the management of the business
and affairs of the Company.
"LLC Interest Put Notice" shall have the meaning ascribed to such
term in Section 2.1 hereof.
"LLC Interest Put Option" shall have the meaning ascribed to such
term in Section 2.1 hereof.
"LLC Interest Put Value" shall mean the amount that would be
distributed to VFUT if the LLC received an amount equal to the product
obtained by multiplying (x) the LLC FFO by (y) the Put Multiple, and such
amount was then distributed among the Members in accordance with the
provisions of Section 4.2 of the LLC Agreement.
"Loans" shall mean any loan to the Company or either owner LLC
including the following loans:
(a) Mortgage loan in the maximum principal amount of
$275,000,000 made to VF Mall LLC by Canadian Imperial Bank
of Commerce, as Administrative Agent, for CIBC Inc.,
Hypovereinsbank AG, New York Branch, ("HB") and other
lenders extending credit thereunder, CIBC Inc., as a
Co-Arranger and Co-Agent, and HB, as a Co-Arranger and
Co-Agent; and
(b) Mortgage loan in the original principal amount of
$85,000,000 made by The Northwestern Mutual Life Insurance
Company to University Towne Center Associates.
"Mall" shall mean either the Valley Fair Mall or the UTC Mall.
"Mall FFO" shall mean the FFO of the Owner LLC of the applicable
Mall for the four (4) calendar quarters used in calculating the applicable
Put Multiple.
"Mall Put Notice" shall have the meaning ascribed to such term in
Section 3.1 hereof.
"Mall Put Option" shall have the meaning ascribed to such term in
Section 3.1 hereof.
"Mall Put Value" shall mean the amount that would be distributed to
VFUT if the LLC received an amount equal to the product obtained by
multiplying (x) the Mall FFO for the applicable Mall owned (directly or
indirectly) by the applicable Owner LLC by (y) the Put Multiple, and such
amount was then distributed among the Members in accordance with the
provisions of Section 4.2 of the LLC Agreement.
"Managing Member" shall mean the member then authorized to carry
out the management of the business and affairs of the LLC pursuant to
Article 6 of the LLC Agreement.
"Member" shall mean, at any time, any person or entity admitted and
remaining as a member of the LLC pursuant to the terms of the LLC
Agreement.
"Memorandum" shall have the meaning ascribed to such term in
Section 4.3 hereof.
"▇▇▇▇▇▇ Entity" shall mean the Commingled Pension Trust Fund
(Strategic Property) of ▇▇▇▇▇▇ Guaranty Trust Company of New York, or a
private or government pension fund or collective investment fund for which
▇.▇. ▇▇▇▇▇▇ Investment Management Inc. or ▇▇▇▇▇▇ Guaranty Trust Company of
New York (or one of their parents, affiliates, or subsidiaries, successors
or assigns) acts as trustee, agent or independent advisor (with
discretion).
"Non-Qualified Distributee" shall mean any Person that is entitled
to a distribution of WEA Shares pursuant to the provisions of this
Agreement that is not a Qualified Distributee.
"Notice" shall have the meaning ascribed to such term in Section
4.5 hereof.
"Offer Notice" shall have the meaning ascribed to such term in
Section 8.5 of the LLC Agreement as of the date hereof.
"Owner LLC" shall mean either UTC LLC or VF Mall LLC.
"Person" shall mean any individual, corporation, partnership,
limited liability company, association, trust or other entity or
organization.
"Proposed QP" shall have the meaning ascribed to such term in
Section 4.3 hereof.
"Put Multiple" shall mean, at any time, the quotient obtained by
dividing (x) the Share Price by (y) the sum of the per share FFO of WEA for
the most recently publicly reported four (4) calendar quarters.
"Qualified Distributee" shall mean (a) VFUT, (b) a ▇▇▇▇▇▇ Entity or
(c) any Person (i) that is a designee of VFUT, a successor to VFUT or a
subsequent transferee of VFUT's LLC Interest, and (ii) that would not, to
the reasonable satisfaction of WEA, at the time of such distribution, cause
the ownership limitations contained in WEA's Articles of Incorporation to
be violated by any such distribution of WEA Shares to any greater extent
than if such WEA Shares were being distributed to VFUT.
"QP Distributee" shall have the meaning ascribed to such term in
Section 4.3 hereof.
"Qualified Person" shall mean a Person who would not, by
consummating the transactions contemplated by the exercise of a LLC
Interest Put Option or Mall Put Option: (i) cause WEA to recognize rental
income from any Person described in Section 856(d)(2)(B) of the Code, after
taking into account Section 856(d)(6); (ii) cause a violation of Section
6.8 of the LLC Agreement; or (iii) otherwise jeopardize the real estate
investment trust status of WEA; provided, however, that so long as 100% of
the outstanding interests of a Person are owned by a ▇▇▇▇▇▇ Entity, such
Person shall be deemed to be a Qualified Person.
"Qualified Person Notice" shall have the meaning ascribed to such
term in Section 4.3 hereof.
"REIT Counsel" shall have the meaning ascribed to such term in
Section 4.3 hereof.
"REOC Date" shall mean the date on which the LLC or either Owner
LLC shall no longer be operated in a manner which will maintain the LLC's
status as a "real estate operating company" as defined in Department of
Labor regulations set forth at 29 CFR ss. 2510.3-101(c) or enable it to
qualify for another "plan asset" exception under such regulations.
"Right Of First Offer Sale Notice" shall have the meaning ascribed
to such term in Section 8.6 of the LLC Agreement as of the date hereof.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Share Price" shall mean the average of the daily high and low
trading prices of a share of common stock of WEA for the twenty (20)
consecutive trading days, as quoted in the eastern edition of The Wall
Street Journal, beginning on the twenty fifth (25th) Business Day prior to
the date on which VFUT shall deliver the LLC Interest Put Notice or Mall
Put Notice, as applicable, (if publication of The Wall Street Journal, or
such price therein, is discontinued, the price shall be determined on the
basis of such other publication, statistical guide or information service
as VFUT may select with WEA's reasonable approval).
"Taxes" shall mean any and all state, county and city documentary
stamp and other transfer taxes, any sales taxes related to the transfer of
personal property and all interest and/or penalties due in connection
therewith.
"Trading Period" shall have the meaning ascribed to such term in
Section 4.2(a) hereof.
"Transfer" shall mean any sale, assignment, transfer, gift,
hypothecation or encumbrance.
"UTC Lockout Date" shall mean the earlier of (i) the REOC Date and
(ii) the third (3rd) anniversary of the date of the execution and delivery
of this Agreement.
"UTC LLC" shall mean University Towne Center LLC, a Delaware
limited liability company.
"UTC Mall" shall mean the Westfield Shoppingtown UTC, a shopping
center located in San Diego, California.
"Valley Fair Mall" shall mean the Westfield Shoppingtown Valley
Fair, a shopping center located in San Jose, California.
"Valley Fair Lockout Date" shall mean the earlier of (i) the REOC
Date and (ii) the fifth (5th) anniversary of the date of the execution and
delivery of this Agreement.
"VF Mall LLC" shall mean VF Mall LLC, a Delaware limited liability
company.
"VFUT" shall have the meaning ascribed to such term in the
recitals.
"VFUT Distribution" shall have the meaning ascribed to such term in
Section 3.1 hereof.
"WEA" shall have the meaning ascribed to such term in the recitals.
"WEA Shares" shall mean the common stock of WEA.
"WEA Securities" shall have the meaning ascribed to such term in
Section 4.2 hereof.
"WEA Valley Fair" shall have the meaning ascribed to such term in
the recitals.
Capitalized terms not defined herein shall have the respective
meanings ascribed to such terms in the LLC Agreement. All accounting terms
used herein and not expressly defined shall have the meanings assigned to
such terms in accordance with generally accepted accounting principles, and
the term "generally accepted accounting principles" means such accounting
principles as are generally accepted at the time of any computation.
ARTICLE II
LLC INTEREST PUT OPTION
Section 2.1 (a) Grant. VFUT shall have the right and option, to be
exercised at the election of VFUT in its sole and absolute discretion, to
sell VFUT's entire LLC Interest to WEA, and to require WEA to purchase such
interest in accordance with the provisions of this Agreement (the "LLC
Interest Put Option").
(b) Exercise. The LLC Interest Put Option is
exercisable by VFUT upon the delivery of written notice to WEA (the "LLC
Interest Put Notice") at any time (x) after (i) to the extent the LLC shall
then directly or indirectly own both the UTC Mall and the Valley Fair Mall,
or only the Valley Fair Mall, the Valley Fair Lockout Date or (ii) to the
extent that the LLC shall own directly or indirectly only the UTC Mall, the
UTC Lockout Date and (y) prior to the Expiration Time. Notwithstanding
anything to the contrary contained herein, VFUT shall not have the right to
initiate the exercise of the LLC Interest Put Option during the pendency of
an Adverse Economic Impact Period. Only a Qualified Person may consummate
the exercise of a LLC Interest Put Option.
Section 2.2 (a) Closing. If the LLC Interest Put Notice shall be
properly delivered, the closing of the purchase and sale of VFUT's entire
LLC Interest shall be held at a location in Los Angeles, California or New
York, New York designated by WEA by written notice to VFUT (or, at the
election of either WEA or VFUT, pursuant to escrow arrangements acceptable
to both WEA and VFUT in the exercise of their reasonable judgment) on a
Business Day selected by WEA not less than thirty (30) days and not more
than ninety (90) days from the date of the determination of the LLC
Interest Put Value. Subject to the terms of Section 4.1 of this Agreement,
WEA shall pay the LLC Interest Put Value in WEA Shares. At the time of
delivery of such WEA Shares, all such WEA Shares shall be duly authorized,
validly issued and outstanding, fully paid and non-assessable and shall be
listed or authorized for trading on any stock market or exchange on which
WEA Shares are listed or authorized for trading. At the closing, (i) WEA
shall deliver to VFUT, or its designee, a number of WEA Shares equal to the
quotient obtained by dividing (x) the LLC Interest Put Value by (y) the
Share Price; (ii) VFUT shall deliver to WEA, or its designee, (x) an
assignment of all of VFUT's right, title and interest in its entire LLC
Interest which assignment shall be free and clear of all legal or equitable
claims (other than legal or equitable claims to VFUT's LLC Interest, if
any, of WEA Valley Fair pursuant to the LLC Agreement) and (y) a
certificate, dated as of the closing, as to VFUT's non-foreign status, in
the form of Exhibit A hereto, as well as any applicable state or local
withholding certificate reasonably requested by WEA; (iii) WEA shall
deliver to VFUT an assumption of VFUT's obligations under the LLC Agreement
arising from and after such assignment; and (iv) VFUT and WEA shall execute
an agreement acceptable to VFUT and WEA in the exercise of their reasonable
judgment whereby (x) the parties shall represent and warrant to each other
that each is duly organized, validly existing, has the necessary corporate
power and authority to consummate the subject transactions and requires no
consents which have not been obtained and (y) VFUT shall represent to WEA
that VFUT is the owner of VFUT's LLC Interest free and clear of all
pledges, liens, charges and encumbrances and that the Transfer is being
made free and clear of all legal or equitable claims (other than legal or
equitable claims of WEA Valley Fair pursuant to the LLC Agreement).
(b) Costs and Expenses. Each party shall pay its own costs
and expenses in connection with a Transfer pursuant to this Article II.
(c) Default Loan. On the date of any Transfer pursuant to
this Article II, each Member shall pay in full the entire unpaid balance of
any Default Loan made to such Member plus all accrued and unpaid interest
thereon.
(d) Taxes. Any and all Taxes levied or imposed in connection
with a Transfer pursuant to this Article II shall be paid by VFUT. In
addition, VFUT shall indemnify, defend and hold WEA harmless from and
against any and all liability, claims, loss, cost, damage or expense
(including, without limitation, interest, penalties and reasonable attorney
fees, charges and disbursements) that WEA may incur arising out of or in
connection with VFUT's failure to pay any such Taxes.
Section 2.3 Superseding Rights. Notwithstanding anything to the
contrary set forth herein, in the event that, prior to the delivery of an
LLC Interest Put Notice, either (i) a First Offer Transfer Notice under
Section 8.4 of the LLC Agreement, an Offer Notice under Section 8.5 of the
LLC Agreement, a Right of First Offer Sale Notice under Section 8.6 of the
LLC Agreement (collectively, the "LLC Agreement Notices") or a Mall Put
Notice under Article III of this Agreement shall have been delivered (any
such Mall Put Notice or LLC Agreement Notice so delivered being referred to
in this Section 2.3 as a "Previous Notice") and the transactions
contemplated as a result of the delivery of any such Previous Notice shall
not have closed, and the right to consummate such transactions has not
expired or been rescinded or (ii) an action for specific performance shall
have been instituted pursuant to Sections 8.4(c), 8.5(i) or 8.6(h) of the
LLC Agreement or pursuant to Section 4.17 hereto, then the delivery of any
such Previous Notice and the institution of any such action for specific
performance shall supersede the delivery of the LLC Interest Put Notice and
the rights under Section 8.4 of the LLC Agreement, Section 8.5 of the LLC
Agreement, Section 8.6 of the LLC Agreement and Article III of this
Agreement, as applicable, shall supersede the rights under this Article II.
ARTICLE III
MALL PUT OPTION
Section 3.1 (a) Grant. VFUT shall have the right and option, to be
exercised at the election of VFUT in its sole and absolute discretion (the
"Mall Put Option"), to both (x) cause the LLC to distribute to the Members
in accordance with the terms of the LLC Agreement, the LLC's entire
interest in either Owner LLC (the "Distributed Interest"), and thereafter
(y) sell the entire portion of the Distributed Interest that is so
distributed to VFUT (the "VFUT Distribution") to WEA, and to require WEA to
purchase the VFUT Distribution from VFUT, all in accordance with the
provisions of this Agreement.
(b) Exercise. The Mall Put Option is exercisable by
VFUT upon the delivery of written notice to WEA (the "Mall Put Notice") at
any time (x) after (i) to the extent of a distribution of the LLC's
interest in VF Mall LLC, the VF Lockout Date and (ii) to the extent of a
distribution of the LLC's interest in UTC LLC, the UTC Lockout Date and (y)
prior to the Expiration Time. Notwithstanding anything to the contrary
contained herein, VFUT shall not have the right to initiate the exercise of
the Mall Put Option (i) with respect to all the Malls owned directly or
indirectly by the LLC in a single transaction, (ii) with respect to a
particular Mall (or interests in the corresponding Owner LLC) during the
pendency of an Adverse Economic Impact Period with respect to such Mall, or
(iii) so long as the LLC owns only one Mall. Only a Qualified Person may
consummate the exercise of a Mall Put Option.
Section 3.2 (a) Closing. If the Mall Put Notice shall be properly
delivered, the Members shall cause the LLC to distribute the Distributed
Interest to the Members, and WEA shall purchase the VFUT Distribution from
VFUT at a location in Los Angeles, California or New York, New York
designated by WEA by written notice to VFUT (or, at the election of either
WEA or VFUT, pursuant to escrow arrangements acceptable to both WEA and
VFUT in the exercise of their reasonable judgment) on a Business Day
selected by WEA not less than thirty (30) days and not more than ninety
(90) days from the date of the determination of the Mall Put Value. Subject
to the terms of Section 4.1 of this Agreement, WEA shall pay the Mall Put
Value in WEA Shares. At the time of delivery of such WEA Shares, all such
WEA Shares shall be duly authorized, validly issued and outstanding, fully
paid and non-assessable and shall be listed on any stock market or exchange
on which WEA Shares are listed. At the closing, (i) the Members shall cause
the LLC to distribute to the Members in accordance with the terms of the
LLC Agreement all of the LLC's interest in such Owner LLC; (ii) WEA shall
deliver to VFUT, or its designee, a number of WEA Shares equal to the
quotient obtained by dividing (x) the Mall Put Value by (y) the Share
Price; (iii) VFUT shall deliver to WEA, or its designee, (a) an assignment
of all of VFUT's right, title and interest in its entire VFUT Distribution,
and (b) a certificate, dated as of the closing, as to VFUT's non-foreign
status in the form of Exhibit A hereto, as well as any applicable state or
local withholding certificate reasonably requested by WEA; (iv) WEA shall
deliver to VFUT an assumption of VFUT's obligations under the limited
liability agreement of such Owner LLC; (v) VFUT and WEA Valley Fair shall
cause the LLC to represent to the Members that, to the best of the Managing
Member's knowledge, the LLC's interest in the applicable Owner LLC is being
distributed free and clear of all pledges, liens, charges and encumbrances
and all legal or equitable claims; and (vi) VFUT and WEA shall execute an
agreement acceptable to VFUT and WEA in the exercise of their reasonable
judgment whereby (x) the parties shall represent and warrant to each other
that each is duly organized, validly existing, has the necessary corporate
power and authority to consummate the subject transactions and requires no
consents which have not been obtained and (y) VFUT shall represent and
warrant to WEA that VFUT has not created or allowed any pledge, lien,
charge or encumbrance on the VFUT Distribution following distribution of
the VFUT Distribution from the LLC to VFUT and that, to the best of VFUT's
knowledge, the VFUT Distribution is being Transferred free and clear of all
pledges, liens, charges and encumbrances and legal or equitable claims
(other than legal or equitable claims of WEA Valley Fair pursuant to the
LLC Agreement).
(b) Costs and Expenses. Each party shall pay their own
costs and expenses in connection with a Transfer pursuant to this Article
III; provided, however, that all expenses of the LLC (other than Taxes) in
connection with such Transfer shall be borne by the LLC.
(c) Default Loan. On the effective date of any Transfer
pursuant to this Article III, each Member shall pay in full the entire
unpaid principal balance of any Default Loan made to such Member plus all
accrued and unpaid interest thereon.
(d) Taxes. Any Taxes levied or imposed in connection
with a Transfer pursuant to this Article III shall be paid by VFUT. In
addition, VFUT shall indemnify, defend and hold WEA harmless from and
against any and all liability, claims, loss, cost, damage or expense
(including, without limitation, interest, penalties and reasonable attorney
fees, charges and disbursements) that WEA may incur arising out of or in
connection with VFUT's failure to pay any such Taxes.
Section 3.3 Superseding Rights. Notwithstanding anything to the
contrary set forth herein, in the event that, prior to the delivery of a
Mall Put Notice with respect to a Mall/Owner LLC, either (i) an LLC
Agreement Notice shall have been delivered with respect to such Mall/Owner
LLC or an LLC Interest Put Notice under Article II of this Agreement shall
have been delivered (any such LLC Interest Put Notice or LLC Agreement
Notice so delivered being referred to in this Section 3.3 as a "Previous
Notice") and the transactions contemplated as a result of the delivery of
any such Previous Notice shall not have closed, and the right to consummate
such transactions have not expired or been rescinded or (ii) an action for
specific performance shall have been instituted with respect to such
contemplated transactions pursuant to Section 8.4(c), 8.5(i) or 8.6(h) of
the LLC Agreement or pursuant to Section 4.17 hereto, then the delivery of
any such Previous Notice and the institution of any such action for
specific performance shall supersede the delivery of such Mall Put Notice
and the rights under Section 8.4 of the LLC Agreement, Section 8.5 of the
LLC Agreement, Section 8.6 of the LLC Agreement and Article II of this
Agreement, as applicable, shall supersede the rights under this Article III
with respect to the Mall(s)/Owner LLC(s) that is subject to the Previous
Notice or such action for specific performance.
ARTICLE IV
MISCELLANEOUS PROVISIONS
Section 4.1 (a) Ownership Limitations. Notwithstanding anything to
the contrary contained herein, if the number of WEA Shares to be
distributed to a Qualified Distributee pursuant to this Agreement shall
exceed the ownership limitations contained in WEA's Articles of
Incorporation, and such limitations shall not be waived or amended to allow
for the distribution in full to such Qualified Distributee of such shares,
such Qualified Distributee and WEA shall cooperate in good faith to
structure the distribution in a manner that shall avoid such limitations.
If, after good faith efforts, the distribution cannot be structured in a
manner to avoid such limitations, such Qualified Distributee shall have the
right, exercisable upon delivery of written notice to WEA, to elect either
to (i) not proceed with a Transfer pursuant to this Agreement, in which
event such Qualified Distributee's exercise of the LLC Interest Put Option
or Mall Put Option, as applicable, shall be null and void and of no further
force or effect, or (ii) proceed with a Transfer pursuant to this
Agreement, in which event WEA shall deliver to such Qualified Distributee
in immediately available federal funds, in lieu of such excess shares, the
difference between the LLC Interest Put Value or the Mall Put Value,
whichever is applicable, and the product of (x) the Share Price and (y) the
number of shares that may be delivered to such Qualified Distributee as a
result of such restriction.
(b) Notwithstanding anything to the contrary contained
herein, if the number of WEA Shares to be distributed to a Non-Qualified
Distributee shall exceed the ownership limitations contained in WEA's
Articles of Incorporation, and such limitations shall not be waived or
amended to allow for the distribution of such WEA Shares in full to such
Non-Qualified Distributee, such Non-Qualified Distributee must locate a
buyer for the excess WEA Shares subject to WEA's reasonable approval of
such buyer. If such Non-Qualified Distributee cannot locate a buyer for the
excess WEA Shares, such Non-Qualified Distributee's exercise of the LLC
Interest Put Option or Mall Put Option, as applicable, shall be null and
void and of no further force or effect.
(c) If the number of WEA Shares to be distributed to either
a Qualified or Non-Qualified Distributee (each, a "Distributee") shall
exceed the limitation under Rule 312.03(c) of the New York Stock Exchange
or any successor rule, such Distributee shall have the right, exercisable
upon delivery of written notice to WEA, to elect either to (i) not proceed
with a Transfer pursuant to this Agreement, in which event such
Distributee's exercise of the LLC Interest Put Option or Mall Put Option,
as applicable, shall be null and void and of no further force or effect, or
(ii) proceed with a Transfer pursuant to this Agreement, in which event WEA
shall distribute the amount of WEA Shares allowed under Rule 312.03(c) of
the New York Stock Exchange or any successor rule and within 120 days
either (i) obtain the shareholder approval required by the rules of the New
York Stock Exchange and distribute the excess WEA Shares to the Distributee
or (ii) deliver to the Distributee in immediately available federal funds,
in lieu of such excess WEA Shares, the difference between the LLC Interest
Put Value or the Mall Put Value, whichever is applicable, and the product
of (x) the Share Price and (y) the number of shares that may be delivered
to the Distributee as a result of such restriction. WEA shall use
commercially reasonable efforts to obtain such shareholder approval.
Section 4.2 (a) Prohibition of Influence on Share Price. VFUT
covenants that it shall not and shall not knowingly cause any of its
Affiliates to trade in any publicly traded securities of WEA ("WEA
Securities") at any time during any twenty (20) consecutive day trading
period used to calculate the Share Price in connection with the exercise of
either a Mall Put Option or LLC Interest Put Option, as applicable (each
such consecutive twenty (20) day trading period being referred to
herein as a "Trading Period") with the intent to cause a decrease in the
Share Price in connection with an exercise of a LLC interest Put Option or
a Mall Put Option.
(b) In any action or proceeding claiming a breach of the
covenant contained in Section 4.2(a), the parties hereto acknowledge and
agree that (i) WEA shall have the burden to prove that VFUT traded or
knowingly caused an Affiliate of VFUT to trade in WEA Securities at any
time during a Trading Period and (ii) if WEA shall prove that VFUT traded
or knowingly caused an Affiliate of VFUT to trade in WEA Securities at any
time during a Trading Period, VFUT shall have the burden to prove that
VFUT's intent in connection with such trading was not to cause a decrease
in the Share Price in connection with the exercise of an LLC Interest Put
Option or a Mall Put Option. If a court of competent jurisdiction renders a
final decision finding that VFUT traded or knowingly caused an Affiliate of
VFUT to trade in WEA Securities at any time during a Trading Period and
VFUT shall be unable to prove that VFUT's intent in connection with such
trading was not to cause a decrease in the Share Price in connection with
the exercise of an LLC Interest Put Option or a Mall Put Option, subject to
the terms of Section 4.2(c) of this Agreement, WEA shall have as its sole
and exclusive remedy in connection with a breach of the covenant contained
in Section 4.2(a), the right to either (x) rescind the applicable Mall Put
Option or LLC Interest Put Option transaction or (y) recover from VFUT any
actual damages suffered as a result of such trading.
(c) WEA hereby irrevocably waives any right to seek an
injunction or other remedy available at law or in equity to prevent or
enjoin the consummation of the transactions contemplated by the Mall Put
Option or LLC Interest Put Option in connection with a claim that VFUT
breached the covenant contained in Section 4.2(a) of this Agreement;
provided, however, that the benefits of this waiver shall not run to any
successor to VFUT or subsequent transferee of VFUT's LLC Interest that is
not a ▇▇▇▇▇▇ Entity or an Affiliate.
Section 4.3 Qualified Person Limitation.
(a) From time to time following written request, WEA shall
provide VFUT with a determination as to whether a Person (a "Proposed QP")
is a Qualified Person. WEA may request additional information concerning
such Proposed QP reasonably necessary for WEA to make a determination as to
whether such Proposed QP shall be, at the time of the determination, a
Qualified Person. Within 5 business days after receiving all information
reasonably necessary to make such determination, WEA shall provide VFUT
with notice of its decision as to whether or not such Proposed QP is a
Qualified Person. Any dispute with respect to whether a Proposed QP is a
Qualified Person shall be resolved by counsel to WEA, which counsel shall
be Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, or such other nationally
recognized tax counsel selected by WEA in its sole and absolute discretion
and experienced in such matters ("REIT Counsel"). The determination of such
REIT Counsel set forth in a memorandum to VFUT and WEA stating the facts
deemed to be relevant by such REIT Counsel and the reasons for such
determination ("Memorandum") shall be binding on all parties to this
Agreement. Without limiting the generality of the foregoing, any Memorandum
to the effect that such REIT Counsel would not be able to render its
customary formal legal opinion with respect to the REIT status of WEA if
such exercise of the LLC Interest Put Option or Mall Put Option were
consummated by the Proposed QP shall establish conclusively that such
Proposed QP is not a Qualified Person.
(b) Regardless of any determination made by WEA under
Section 4.3(a) of this Agreement, within 15 business days after receipt of
a LLC Interest Put Notice or a Mall Put Notice, WEA may, in one or more
communications, request that VFUT, VFUT's designee, a successor to VFUT or
a subsequent transferee of VFUT's LLC Interest (a "QP Distributee") provide
additional information concerning such QP Distributee and relevant to the
status of such QP Distributee as a Qualified Person, including, without
limitation: (i) the names of the direct and indirect shareholders,
subsidiaries, and Affiliates of such QP Distributee; (ii) the extent to
which such QP Distributee is owned by, or owns interests in, such
shareholders, subsidiaries, and Affiliates; and (iii) the existence and
nature of contractual relationships between such QP Distributee and its
shareholders and Affiliates, on the one hand, and WEA and its Affiliates,
on the other hand. Within 5 business days after receiving information
satisfactory to WEA and relevant to the status of such QP Distributee as a
Qualified Person, WEA shall provide such QP Distributee with notice of its
decision as to whether or not such QP Distributee is then a Qualified
Person (a "Qualified Person Notice"). Such QP Distributee agrees to
promptly notify WEA of any changes in the information previously provided
to WEA pursuant to this paragraph. Any determination by WEA that such QP
Distributee is a Qualified Person shall be binding on WEA; provided,
however, that at any time prior to or at the closing of a LLC Interest Put
Option or a Mall Put Option, WEA shall have the right to redetermine such
QP Distributee's status as a Qualified Person based on any change in facts
or law. Any dispute between WEA and such QP Distributee concerning its
status as a Qualified Person shall be resolved by REIT Counsel to WEA. The
determination of such REIT Counsel set forth in a Memorandum shall be
binding on all parties to this Agreement. Without limiting the generality
of the foregoing, any Memorandum to the effect that such REIT Counsel would
not be able to render its customary formal legal opinion with respect to
the REIT status of WEA if such exercise of the LLC Interest Put Option or
Mall Put Option were consummated shall establish conclusively that such QP
Distributee is not a Qualified Person.
Section 4.4 Further Assurances. Each party agrees to execute,
acknowledge, deliver, file, record and publish such further certificates,
amendments to certificates, instruments and documents, and do all such
other acts and things as may be required by law, or as may be required to
carry out the intent and purposes of this Agreement.
Section 4.5 Notices. All notices, demands, consents, approvals,
requests or other communications which any of the parties to this Agreement
may desire or be required to give hereunder (collectively, "Notices") shall
be in writing and shall be given by personal delivery or facsimile or
United States registered or certified mail (postage prepaid, return receipt
requested) addressed as hereinafter provided. Except as otherwise specified
herein, the time period in which a response to any notice or other
communication must be made, if any, shall commence to run on the earliest
to occur of (a) if by personal delivery, the date of receipt, or attempted
delivery, if such communication is refused; (b) if given by facsimile, the
date on which such facsimile is transmitted and confirmation of delivery
thereof is received, and if such date is not a Business Day, the first
Business Day after such date; and (c) if sent by mail (as aforesaid), the
date of receipt or attempted delivery, if such mailing is refused. Until
further notice, notices and other communications under this Agreement shall
be addressed to the parties listed below as follows:
(i) If to VFUT, to:
Valley Fair University Towne Member LLC
c/o ▇.▇. ▇▇▇▇▇▇ Investment Management Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇▇
Fax Number: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Stroock & Stroock & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Fax Number: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) If to WEA Valley Fair, to:
WEA Valley Fair UTC LLC
Westfield America, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇▇
Fax Number: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Rand S. April, Esq.
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax Number: (▇▇▇) ▇▇▇-▇▇▇▇
(iii) If to WEA, to:
Westfield America, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇▇
Fax Number: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Rand S. April, Esq.
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax Number: (▇▇▇) ▇▇▇-▇▇▇▇
Any party may designate another addressee (and/or change its address) for
Notices hereunder by a Notice given pursuant to this Section 4.5.
Section 4.6 Governing Law. This Agreement, the rights and
obligations of the parties hereto, and any claims or disputes relating
thereto shall be governed by and construed in accordance with the laws of
the State of New York (but not including the choice of law rules thereof).
Section 4.7 Consent to Jurisdiction. Any action, suit or proceeding
in connection with this Agreement may be brought against any party in a
court of record of the State of New York, County of New York, or State of
California, County of Los Angeles, or the United States District Court for
the Central District of California, or the Southern District of New York,
each party hereby consenting and submitting to the jurisdiction thereof;
and service of process may be made upon any party, by certified or
registered mail, at the address to be used for the giving of notice to such
party under Section 4.5, hereof. Each party hereby appoints CT Corporation
System, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ as its agent for service of
process. Nothing herein shall affect the right of any party to commence
legal proceedings or otherwise to proceed against any other party in any
other jurisdiction or to serve process in any manner permitted by
applicable law. In any action, suit or proceeding in connection with this
Agreement, each party hereby waives trial any claim that New York County,
Los Angeles County, the Central District of California or the Southern
District of New York is an inconvenient forum.
Section 4.8 Titles, Captions and Headings. All titles, headings or
captions contained in this Agreement are inserted only as a matter of
convenience and for reference and in no way define, limit, extend, or
describe the scope of this Agreement or the intent of any provision hereof.
Section 4.9 Pronouns. All pronouns and any variations thereof shall
be deemed to refer to the masculine, feminine, and neuter, singular and
plural, as the identity of the party or parties may require.
Section 4.10 Assignment. This Agreement and all of the provisions
hereof shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and permitted assigns. Except as set forth
in this Section 4.10, neither this Agreement nor any of the rights granted
herein, nor any of the other interests and obligations created hereunder,
shall be assigned or delegated by any of the parties hereto without the
prior express written consent of the other parties and any such attempted
assignment or delegation shall be void. If either VFUT or WEA Valley Fair
transfers its LLC Interest pursuant to and in accordance with Article VIII
of the LLC Agreement, this Agreement, including any rights and obligations
created hereunder, may be assigned by VFUT or WEA Valley Fair to its
respective transferee under the LLC Agreement.
Section 4.11 Extension Not a Waiver. No delay or omission in the
exercise of any power, remedy or right herein provided or otherwise
available to a party shall impair or affect the right of such party
thereafter to exercise the same. Any extension of time or other indulgence
granted to a party hereunder shall not otherwise alter or affect any power,
remedy or right of any other party, or the obligations of the party to whom
such extension or indulgence is granted.
Section 4.12 Severability. In case any one or more of the
provisions contained in this Agreement or any application thereof shall be
invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein and other
application thereof shall not in any way be effected or impaired thereby.
Section 4.13 Consents. Any consent or approval to any act or matter
required under this Agreement must be in writing and shall apply only with
respect to the particular act or matter to which such consent or approval
is given, and shall not relieve any party from the obligation to obtain the
consent or approval, as applicable, wherever required under this Agreement
to any other act or matter.
Section 4.14 Entire Agreement. This Agreement and the LLC Agreement
contain the entire agreement between the parties relating to the subject
matter hereof and all prior agreements relative hereto which are not
contained herein are terminated. Amendments, variations, modifications or
changes herein may be made effective and binding upon the parties by, and
only by, the setting forth of same in a document duly executed by each
party, and any alleged amendment, variation, modification or change herein
which is not so documented shall not be effective as to any party.
Section 4.15 Counterparts. This Agreement may be executed in any
number of counterparts, and each such counterpart will for all purposes be
deemed an original, and all such counterparts shall constitute one and the
same instrument.
Section 4.16 Transfers Pursuant to this Agreement. Notwithstanding
anything to the contrary contained in this Agreement, no Transfer shall be
made pursuant to Article II or Article III of this Agreement which would
violate or cause an acceleration of the maturity of any of the documents
evidencing or securing any Loan. If a contemplated Transfer requires the
consent of any holder of the beneficial interest under any Loan, VFUT shall
have the obligation to obtain such consent(s) from all necessary parties,
at VFUT's sole cost and expense.
Section 4.17 Specific Performance. VFUT, WEA Valley Fair and WEA
acknowledge that there would be no adequate remedy at law if any party
fails to perform any of its obligations hereunder, and accordingly agree
that VFUT, WEA Valley Fair and WEA, in addition to any other remedy to
which it may be entitled at law or in equity, shall be entitled to compel
specific performance of the obligations of another party under this
Agreement in accordance with the terms and conditions of this Agreement.
Section 4.17 Attorney's Fees. In the event that any party to this
Agreement is required to retain the services of any attorney to enforce or
otherwise litigate or defend any matter or claim arising out of or in
connection with this Agreement, then the prevailing party (as evidenced by
a final, non-appealable court order) shall be entitled to its reasonable
attorneys' fees from the non-prevailing party.
Section 4.18 Waiver of Trial By Jury. Each party acknowledges and
agrees that any controversy which may arise under this Agreement is likely
to involve complicated and difficult issues, and therefore each such party
hereby irrevocably and unconditionally waives any right such party may have
to a trial by jury in respect of any litigation directly or indirectly
arising out of or relating to this Agreement, or the transactions
contemplated by this Agreement. Each party certifies and acknowledges that
(i) no representative, agent or attorney of any other party has
represented, expressly or otherwise, that such other party would not, in
the event of litigation, seek to enforce the foregoing waiver, (ii) each
party understands and has considered the implications of this waiver and
(iii) each party makes this waiver voluntarily.
IN WITNESS WHEREOF, the undersigned have duly executed this
Agreement on the date first above written.
VALLEY FAIR UNIVERSITY TOWNE
MEMBER LLC, a Delaware limited liability
company
By: Commingled Pension Trust Fund
(Strategic Property) of ▇▇▇▇▇▇ Guaranty
Trust Company of New York
By: ▇▇▇▇▇▇ Guaranty Trust Company of
New York, its Trustee
By: /s/▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
_________________________________
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
WEA VALLEY FAIR UTC LLC, a
Delaware limited liability company
By: Westfield America Limited Partnership,
its Managing Member
By: Westfield America, Inc., its Managing
General Partner
By: /s/▇▇▇ ▇▇▇▇▇▇
__________________________________
▇▇▇ ▇▇▇▇▇▇
Secretary
WESTFIELD AMERICA, INC., a Missouri
Corporation
By: /s/▇▇▇ ▇▇▇▇▇▇
_________________________________
▇▇▇ ▇▇▇▇▇▇
Secretary
EXHIBIT A
Form of FIRPTA Certificate
Section 1445 of the Internal Revenue Code provides that a transferee of a
U.S. real property interest must withhold tax if the Transferor is a
foreign person. To inform the transferee, Westfield America, Inc., that
withholding of tax is not required upon the disposition of a U.S. real
property interest by [ ] ("Transferor"), the undersigned hereby swears,
affirms, and certifies the following on behalf of the Transferor:
1. Transferor is not a foreign corporation, foreign partnership,
foreign trust, or foreign estate (as those terms are defined in the
Internal Revenue Code and Income Tax Regulations);
2. Transferor's social security number or U.S. employer I.D. number
is: ____________; and
3. Transferor's address is:
Transferor understands that this certification may be disclosed to the
Internal Revenue Service by the transferee and that any false statement
contained herein could be punished by fine, imprisonment, or both.
Under penalties of perjury, I declare that I have examined this
certification and to the best of my knowledge and belief it is true,
correct and complete, and I further declare that I have the authority to
sign this document on behalf of Transferor.
Executed as of the ____ day of .
[TRANSFEROR]
By:_______________________
Name:
Title:
