AGREEMENT AND PLAN OF MERGER by and among WESTCOR REALTY LIMITED PARTNERSHIP, MACERICH GALAHAD LP and THE MACERICH PARTNERSHIP, L.P. dated as of May 30, 2002

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Exhibit 2.1

AGREEMENT AND PLAN OF MERGER

by and among

WESTCOR REALTY LIMITED PARTNERSHIP,

MACERICH GALAHAD LP

and

THE MACERICH PARTNERSHIP, L.P.

dated as of May 30, 2002

TABLE OF CONTENTS

ARTICLE I DEFINITIONS			1
ARTICLE II THE MERGER; CLOSING			7
	Section 2.1	*The Merger.*	7
	Section 2.2	*Effects of the Merger*	8
	Section 2.3	*General Partner Authorization*	8
	Section 2.4	*Conversion of Interests*	8
	Section 2.5	*Deposits.*	9
	Section 2.6	*Closing*	9
	Section 2.7	*Actions at Closing*	9
	Section 2.8	*Pre-Closing Distribution; Balance Sheet Adjustment.*	10
	Section 2.9	*Additional Payment.*	13
	Section 2.10	*Physical Inspection Period*	14
	Section 2.11	*Alternative Transaction Structures*	15
	Section 2.12	*Proposed Development Properties Transactions*	15
	Section 2.13	*Time of the Essence*	15
ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY			15
	Section 3.1	*Capitalization*	15
	Section 3.2	*Organization of Acquired Companies; Authority.*	16
	Section 3.3	*Affiliated Property Owners*	17
	Section 3.4	*Financial Statements; Undisclosed Liabilities.*	17
	Section 3.5	*Absence of Certain Changes*	18
	Section 3.6	*Consents and Approvals.*	19
	Section 3.7	*Litigation*	19
	Section 3.8	*Taxes*	19
	Section 3.9	*Employee Benefit Plans*	21
	Section 3.10	*Properties*	22
	Section 3.11	*Labor and Employment Matters*	23
	Section 3.12	*Contracts and Commitments.*	24
	Section 3.13	*Intellectual Property*	25
	Section 3.14	*Environmental Matters*	25
	Section 3.15	*Compliance with Laws; Permits*	26
	Section 3.16	*Insurance*	27
	Section 3.17	*Brokers*	27
	Section 3.18	*Disclaimer; Company's Knowledge; Disclosure; Material Adverse Effect.*	27
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE BUYER AND ACQUISITION SUB			30
	Section 4.1	*Organization of the Buyer and Acquisition Sub*	30
	Section 4.2	*Authority*	30
	Section 4.3	*Consents and Approvals.*	31
	Section 4.4	*Litigation*	31
	Section 4.5	*Financing*	31
	Section 4.6	*Brokers*	31
	Section 4.7	*ERISA Compliance*	32
	Section 4.8	*Buyer's Knowledge; Disclosure.*	32
ARTICLE V CERTAIN COVENANTS AND AGREEMENTS OF THE BUYER, ACQUISITION SUB AND THE COMPANY			33

	Section 5.1	*Conduct of Business Prior to Closing.*	33
	Section 5.2	*Access to Information.*	35
	Section 5.3	*Confidentiality*	36
	Section 5.4	*Regulatory and Other Authorizations; Consents.*	36
	Section 5.5	*Further Action*	36
	Section 5.6	*Press Releases*	37
	Section 5.7	*No Solicitation*	37
	Section 5.8	*Tax Returns.*	37
	Section 5.9	*Employee Matters.*	38
	Section 5.10	*Conveyance Taxes; Costs*	40
	Section 5.11	*Existing Partnership Indemnification Rights*	40
	Section 5.12	*Notice of Certain Facts*	41
	Section 5.13	*Resolution of Certain Litigation*	41
ARTICLE VI CONDITIONS TO CLOSING			42
	Section 6.1	*Conditions to the Obligations of Each Party*	42
	Section 6.2	*Conditions to Obligations of the Company*	42
	Section 6.3	*Conditions to Obligations of the Buyer and Acquisition Sub*	43
ARTICLE VII INDEMNIFICATION			44
	Section 7.1	*Survival*	44
	Section 7.2	*Indemnification by the Partners.*	44
	Section 7.3	*Indemnification by the Buyer.*	48
ARTICLE VIII TERMINATION, AMENDMENT AND WAIVER			50
	Section 8.1	*Termination*	50
	Section 8.2	*Effect of Termination.*	51
	Section 8.3	*Waiver*	52
ARTICLE IX GENERAL PROVISIONS			52
	Section 9.1	*Notices*	52
	Section 9.2	*Interpretation*	53
	Section 9.3	*Counterparts*	54
	Section 9.4	*Entire Agreement; No Third-Party Beneficiaries; Severability*	54
	Section 9.5	*Amendment*	54
	Section 9.6	*Governing Law*	54
	Section 9.7	*Consent to Jurisdiction*	54
	Section 9.8	*Assignment*	54
	Section 9.9	*Expenses*	54
	Section 9.10	*Execution by Officer of the Company*	54

EXHIBITS LIST

Exhibit A		Schedule of Partners
Exhibit B		Form of Certificate of Merger
Exhibit C		Form of Deposit Escrow Agreement
Exhibit D		Form of Indemnification Escrow Agreement
Exhibit E		Form of Buyer Counsel Legal Opinion
Exhibit F		Form of Company Counsel Legal Opinion
Exhibit G		Terms of Proposed Alternative Transaction Structure
Exhibit H		Terms of Proposed Development Properties Transaction

SCHEDULES LIST

Schedule 2.8		Mortgage Debt
Schedule 3.1		Capitalization
Schedule 3.2(a)		Organization of Acquired Companies
Schedule 3.2(b)		Authority of the Company
Schedule 3.3		Affiliated Property Owners
Schedule 3.4		Financial Statements; Undisclosed Liabilities
Schedule 3.5		Absence of Certain Changes
Schedule 3.6		Consents and Approvals of the Company
Schedule 3.7		Company Litigation
Schedule 3.8		Taxes
Schedule 3.9		Employee Benefit Plans
Schedule 3.10(a)		Properties
Schedule 3.10(b)		Leases
Schedule 3.10(c)		Rights to Purchase or Lease
Schedule 3.10(d)		Reciprocal Easement Agreements
Schedule 3.11		Labor and Employment Matters
Schedule 3.12		Contracts and Commitments
Schedule 3.13		Intellectual Property
Schedule 3.14		Environmental Matters
Schedule 3.15		Compliance with Laws; Permits; Contracts with Governmental Authorities
Schedule 3.16		Insurance
Schedule 4.2		Authority of the Buyer and Acquisition Sub
Schedule 4.3		Consents and Approvals of the Buyer and Acquisition Sub
Schedule 4.4		Buyer Litigation
Schedule 4.5		Financing
Schedule 5.1(a)		Budget and Business Plan for 2002
Schedule 5.1(b)		Conduct of Business Prior to Closing
Schedule 5.10		Municipal Taxes
Schedule 6.1		Required Approvals
Schedule 6.2		Buyer Required Consents
Schedule 6.3		Company Required Consents
Schedule 6.3(j)		Affiliate Agreements

iii

AGREEMENT AND PLAN OF MERGER

THIS AGREEMENT AND PLAN OF MERGER (this "Agreement") is dated as of May 30, 2002, by and among WESTCOR REALTY LIMITED PARTNERSHIP, a Delaware limited partnership (the "Company"), THE MACERICH PARTNERSHIP, L.P., a Delaware limited partnership (the "Buyer"), and MACERICH GALAHAD LP, a Delaware limited partnership and a subsidiary of the Buyer ("Acquisition Sub").

WHEREAS, the Buyer has formed Acquisition Sub as a subsidiary in order to effect the merger of Acquisition Sub with and into the Company (the "Merger"), in accordance with this Agreement and the laws of the State of Delaware such that, upon consummation of the Merger, the Company will be a subsidiary of the Buyer and Acquisition Sub will cease to exist;

WHEREAS, this Agreement and the consummation of the Merger and the other transactions contemplated by this Agreement have been approved by the board of directors of The Macerich Company, the general partner of the Buyer;

WHEREAS, this Agreement and the consummation of the Merger and the other transactions contemplated by this Agreement have been approved by Macerich Galahad GP Corp., in its capacity as the general partner of Acquisition Sub ("Acquisition GP"), and the requisite number of the limited partners of Acquisition Sub; and

WHEREAS, this Agreement and the consummation of the Merger and the other transactions contemplated by this Agreement have been approved by all necessary parties in accordance with the Limited Partnership Agreement of the Company dated as of July 28, 1994, as amended (the "Limited Partnership Agreement"), and Section 17-211 of the DRULPA (as hereinafter defined).

NOW THEREFORE, in consideration of the mutual agreements and covenants herein contained, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties, intending to be legally bound, hereby agree as follows:

ARTICLE I
DEFINITIONS

"1998 Equity Plan" shall have the meaning set forth in Section 5.9.

"1998 Incentive Plan" shall have the meaning set forth in Section 5.9.

"Accountant" shall have the meaning set forth in Section 2.8.

"Acquired Company" or "Acquired Companies" shall mean the Company and the Subsidiaries.

"Acquired Companies Employees" shall have the meaning set forth in Section 5.9.

"Acquisition GP" shall have the meaning set forth in the Preamble.

"Acquisition Sub" shall have the meaning set forth in the Preamble.

"Additional Adjustment Payment" shall have the meaning set forth in Section 2.8(d)(i)(B).

"Adjusted Liabilities" shall mean, with respect to any Person and without duplication, the sum of: (a) non-mortgage liabilities (exclusive of contingent liabilities under GAAP), including, without limitation, accounts payable, sales tax payable, property tax payable, accrued taxes, incentive compensation to the extent unfunded or unpaid (and excluding, for the avoidance of doubt, the 1998 Incentive Plan and 1998 Equity Plan), liability for non-qualified deferred compensation plans, interest payable, tenant allowances payable, notes payable to any Acquired Company or Affiliated Property Owner less amounts due any Acquired Company or Affiliated Property Owner, assessments payable, contracts payable and other payables (excluding, for the avoidance of doubt, obligations pursuant to the Arrowhead Master Lease to the extent of the Arrowhead Escrow), prepaid rents, and tenant security deposits, but excluding reserves for construction at the Property commonly known as Desert Sky Mall; (b) Net Change in Mortgage Debt (adding the absolute value of any negative Net Change in Mortgage

Debt and subtracting the absolute value of any positive Net Change in Mortgage Debt, as the case may be); and (c) budgeted but unpaid tenant improvement allowances that are reflected in leases signed before the Closing Date, of such Person.

"Adjustment Escrow Amount" shall have the meaning ascribed thereto in the Indemnification Escrow Agreement.

"Adjustment Escrow" shall have the meaning set forth in Section 2.8 hereof.

"Affiliate" of any Person shall mean another Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such first Person.

"Affiliated Property Owners" shall mean those entities, other than the Acquired Companies, that own directly or indirectly any of the Properties and in which one or more Acquired Companies owns a direct or indirect equity interest.

"Aggregate Additional Amount" shall mean the result obtained by subtracting (a) $2,000,000 from (b) the total cash amount equal to the product of (i) the number of days in calendar year 2002 occurring prior to the Closing Date (and exclusive of the Closing Date) multiplied by (ii) the quotient equal to (x) the aggregate amount of Percentage Rent actually received by, or directly or indirectly credited for the account of, the Buyer or any of its Affiliates or any of their respective successors or assigns with respect to the calendar year in which the Closing occurs divided by (y) 365.

"Agreed Amount" shall have the meaning set forth in Section 7.2.

"Arbiter" shall have the meaning set forth in Section 2.9.

"Arrowhead Escrow" shall have the meaning set forth in Section 2.7.

"Arrowhead Master Lease" shall mean the master lease entered into by The Westcor Company II Limited Partnership with respect to the Property commonly known as the Arrowhead Marketplace in connection with the Purchase and Sale Agreement and Joint Escrow Instructions dated as of June 13, 2001 between Parcel 18 Associates, LLC, as seller, and GDA Real Estate Services, LLC, as buyer.

"Balance Sheet Adjustment Amount" shall mean, as of the Closing Date and after giving effect to the Pre-Closing Distributions, the aggregate amount of (a) with respect to any Acquired Company, the difference between (i) the Tangible Non-Real Estate Assets of such Acquired Company and (ii) the Adjusted Liabilities of such Acquired Company, and (b) with respect to any Affiliated Property Owner, the Acquired Companies' pro rata portion of (i) the Tangible Non-Real Estate Assets of such Affiliated Property Owner and (ii) the Adjusted Liabilities of such Affiliated Property Owner.

"Balance Sheet Adjustment Amount Differential" shall mean the difference between (a) the aggregate Balance Sheet Adjustment Amounts shown on the Estimated Closing Date Balance Sheets for all Acquired Companies and Affiliated Property Owners and (b) the aggregate Balance Sheet Adjustment Amounts shown on the Post-Closing Audited Balance Sheets for all Acquired Companies and Affiliated Property Owners.

"Benefit Plans" shall have the meaning set forth in Section 3.9.

"Budget" shall have the meaning set forth in Section 5.1.

"Business Day" shall mean any day that is not a Saturday, a Sunday or other day on which banks are required by law to be closed in New York City; Boston, Massachusetts; or Phoenix, Arizona.

"Buyer" shall have the meaning set forth in the Preamble.

"Buyer Disclosure Schedules" shall have the meaning set forth in Section 4.8.

"Buyer Indemnified Party" shall have the meaning set forth in Section 7.2.

"Buyer Knowledge Party" shall have the meaning set forth in Section 4.8.

"Buyer's Knowledge" shall have the meaning set forth in Section 4.8.

"Certificate of Merger" shall have the meaning set forth in Section 2.1.

"Claim" shall have the meaning set forth in Section 5.11.

"Claim Notice" shall have the meaning set forth in Section 7.2.

"Claimed Amount" shall have the meaning set forth in Section 7.2.

"Closing" shall have the meaning set forth in Section 2.6.

"Closing Date" shall have the meaning set forth in Section 2.6.

"Code" shall mean the Internal Revenue Code of 1986, as amended.

"Company" shall have the meaning set forth in the Preamble.

"Company Disclosure Schedules" shall have the meaning set forth in Section 3.18.

"Company Knowledge Party" shall have the meaning set forth in Section 3.18.

"Company's Knowledge" shall have the meaning set forth in Section 3.18.

"Confidential Memorandum" shall have the meaning set forth in Section 3.18.

"Confidentiality Agreement" shall have the meaning set forth in Section 5.3.

"Contractual Debt Payments" shall mean, with respect to any Person, all indebtedness of such Person that (a) is accrued and unpaid at Closing, (b) arises under contract (including, without limitation, trade payables, construction costs and tenant improvement allowances, but excluding Mortgage Debt, Funded Debt Payments and construction loans) and (c) is for goods and services delivered or rendered (or deemed to have been delivered or rendered pursuant to the applicable contract) on or prior to the Closing Date.

"Delaware Courts" shall have the meaning set forth in Section 9.7.

"Deposit L/C" shall have the meaning set forth in Section 2.5.

"Deposits" shall have the meaning set forth in Section 2.5.

"Deposit Escrow Agreement" shall have the meaning set forth in Section 2.5.

"Dispute" shall have the meaning set forth in Section 7.2.

"DRULPA" shall have the meaning set forth in Section 2.1.

"Eastrich" shall mean Eastrich No. 128 Corp., a Massachusetts corporation and the general partner of the Company.

"Effective Time" shall have the meaning set forth in Section 2.1.

"Employment Agreements" shall have the meaning set forth in Section 3.12.

"Encumbrance" shall mean any security interest, pledge, mortgage, deed of trust, lien (including without limitation, environmental and tax liens), charge, encumbrance adverse claim, preferential arrangement or restriction of any kind.

"Environmental Condition" shall have the meaning set forth in Section 3.14.

"Environmental Laws" shall have the meaning set forth in Section 3.14.

"Environmental Liabilities and Costs" shall have the meaning set forth in Section 3.14.

"Environmental Reports" shall have the meaning set forth in Section 3.14.

"ERISA" shall have the meaning set forth in Section 3.9.

"Escrow Agent" shall have the meaning set forth in Section 2.5.

"Estimated Closing Date Balance Sheets" shall have the meaning set forth in Section 2.8.

"Excluded Occupancy Agreement" shall have the meaning set forth in Section 3.10.

"Financial Statements" shall have the meaning set forth in Section 3.4.

"Funded Debt Payments" shall mean, with respect to any Person, accrued and unpaid scheduled payments of principal of and interest on (and fees and costs corresponding thereto) indebtedness for borrowed money of such Person for periods ending on or prior to the Closing Date.

"GAAP" shall mean United States generally accepted accounting principles consistently applied.

"Governmental Authority" shall have the meaning set forth in Section 3.6.

"Holdback Escrow" shall have the meaning set forth in Section 5.9 hereof.

"Home Office" shall mean the offices of the Company located at 11405, 11411 and ▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇.

"HSR Act" shall have the meaning set forth in Section 3.6.

"Indemnification Cut-Off Date" shall have the meaning set forth in Section 7.2.

"Indemnification Escrow Agreement" shall have the meaning set forth in Section 2.7.

"Indemnification Escrow Amount" shall have the meaning set forth in Section 2.7.

"Indemnification Representative" shall have the meaning set forth in Section 7.2.

"Indemnified Persons" shall have the meaning set forth in Section 5.11.

"Intellectual Property Rights" shall have the meaning set forth in Section 3.13.

"Interest" shall mean, with respect to any Partner, the interest (expressed as a percentage) set forth with respect to such Partner on Exhibit A attached hereto, which represents such Partner's right, title and interest in and to the Company.

"IRS" shall have the meaning set forth in Section 3.8.

"Law" shall have the meaning set forth in Section 3.15.

"Leases" shall have the meaning set forth in Section 3.10.

"Limited Partnership Agreement" shall have the meaning set forth in the Preamble.

"Losses" of a Person shall mean any and all losses, liabilities (including liabilities for Taxes), damages, claims, awards, judgments, costs and expenses (including, without limitation, reasonable attorneys' fees) actually suffered or incurred by such Person.

"Material Adverse Effect" shall have the meaning set forth in Section 3.18.

"Maximum Amount" shall have the meaning set forth in Section 7.2.

"Merger" shall have the meaning set forth in the Preamble.

"Mortgage Debt" shall mean the indebtedness for borrowed money secured by a mortgage or a deed of trust set forth on Schedule 2.8 hereto.

"Most Recent Balance Sheet" shall have the meaning set forth in Section 3.4.

"Municipal Taxes" shall have the meaning set forth in Section 5.10.

"Net Change in Mortgage Debt" shall mean, with respect to any Person, the difference between the aggregate amount of the Mortgage Debt of such Person reflected on Schedule 2.8 and the aggregate amount of the Mortgage Debt as of the Closing Date.

"Net Purchase Price" shall have the meaning set forth in Section 2.7.

"Neutral Auditor" shall have the meaning set forth in Section 2.8.

"Objection Notice" shall have the meaning set forth in Section 2.9.

"Partner" or "Partners" shall mean Eastrich and each limited partner of the Company.

"Partners Indemnified Party" shall have the meaning set forth in Section 7.3.

"Per Interest Additional Payment" shall have the meaning set forth in Section 2.4.

"Per Interest Cash Payment" shall have the meaning set forth in Section 2.4.

"Percentage Rent" shall mean that portion of rent payable by any tenant at any of the Properties, including cart, kiosk and seasonal lease tenants, that is based upon a percentage of such tenant's sales.

"Person" shall mean an individual, corporation, partnership, limited liability company, joint venture, association, trust, unincorporated organization or other entity.

"Physical Inspection Deposit" shall have the meaning set forth in Section 2.5.

"Physical Inspection Period" shall have the meaning set forth in Section 2.10.

"Post-Closing Audited Balance Sheets" shall have the meaning set forth in Section 2.8.

"Pre-Closing Distributions" shall have the meaning set forth in Section 2.8.

"Properties" and each, a "Property," shall have the meaning set forth in Section 3.10.

"PTCE" shall have the meaning set forth in Section 4.7.

"Representatives" shall have the meaning set forth in Section 5.3.

"Required Approvals" shall have the meaning set forth in Section 6.1.

"Response" shall have the meaning set forth in Section 7.2.

"Restricted Transaction" shall have the meaning set forth in Section 2.11.

"Retained Cash" shall mean the Tier I Retained Cash and the Tier II Retained Cash (each as defined herein).

"Review Room" shall have the meaning set forth in Section 3.18.

"Schedules" and each, a "Schedule," shall mean either the Company Disclosure Schedules or the Buyer Disclosure Schedules, as the case may be.

"Securities Act" shall have the meaning set forth in Section 3.1.

"Signing Deposit" shall have the meaning set forth in Section 2.5.

"Specified Litigation" shall have the meaning set forth in Section 5.13 hereof.

"Statement" shall have the meaning set forth in Section 2.9.

"Subsidiary" and collectively, the "Subsidiaries," shall mean Westcor Partners, L.L.C., an Arizona limited liability company, The Westcor Company Limited Partnership, an Arizona limited partnership,

and The Westcor Company II Limited Partnership, an Arizona limited partnership, and any other entity that is 100% owned directly or indirectly by any of the foregoing.

"Surviving Partnership" shall have the meaning set forth in Section 2.1.

"Tangible Non-Real Estate Assets" shall mean, with respect to any Person, the aggregate value of the tangible assets exclusive of real estate and associated personal property (such real estate and associated personal property shall include, for these purposes (w) the proceeds of any sale or other disposition, which proceeds are required to be retained in the applicable Acquired Company or Affiliated Property Owner pursuant to Section 5.1(b)(i) hereof, (x) the reserve for construction at the Property commonly known as Superstition Mall, (y) an additional $608,432 and (z) any receivable or liability associated with straight-lining of rents) of such Person, including, without limitation, Retained Cash (other than Retained Cash consisting of retained proceeds as contemplated above), other cash and cash equivalents, accounts receivable less reserves for doubtful accounts in accordance with GAAP, notes receivable less amounts due from any Acquired Company or Affiliated Property Owner and a reserve for doubtful payments in accordance with GAAP, if any, interest receivable, restricted investments (including assets of any non-qualified deferred compensation plan), prepaid expenses, impounds and deposits.

"Taxes" shall have the meaning set forth in Section 3.8.

"Tax Return" shall have the meaning set forth in Section 3.8.

"Termination Notice" shall have the meaning set forth in Section 2.10.

"Threshold Amount" shall have the meaning set forth in Section 7.2.

"Tier I Retained Cash" shall mean cash and cash equivalents of the Acquired Companies with an aggregate value equal to the amount of the following payment and other obligations of each such Acquired Company, in each case, as reflected on such entity's Estimated Closing Date Balance Sheet and without duplication: (a) Contractual Debt Payments; (b) Funded Debt Payments; (c) accrued and unpaid commitment fees for periods ending on or prior to the Closing Date on any revolving credit facility of such Acquired Company; (d) accrued and unpaid payroll obligations of such Acquired Company for periods ending on or prior to Closing, including, without limitation, payroll taxes, employer 401(k) matching funds obligations, and employer contributions to employee benefits programs (other than the 1998 Equity Plan and the 1998 Incentive Plan); (e) amounts accrued to fund incentive programs of such Acquired Company, including long-term incentive programs, annual incentive programs and annual bonus programs (other than the 1998 Equity Plan and the 1998 Incentive Plan); (f) accrued and unpaid overhead and other costs allocated to the Home Office for periods ending on or prior to the Closing Date, including, without limitation, rent, allocated property taxes, service contracts and utilities; and (g) obligations payable with respect to periods ending on or prior to the Closing Date by such Acquired Company for development costs of any Affiliated Property Owner pursuant to the partnership or limited liability company operating agreement of such Affiliated Property Owner.

"Tier II Retained Cash" shall mean the Acquired Companies' pro rata portion of cash and cash equivalents of the Affiliated Property Owners, with an aggregate value equal to the aggregate amount of the following payment and other obligations of each such Acquired Companies' pro rata portion of each such Affiliated Property Owner, in each case, as reflected on such entity's Estimated Closing Date Balance Sheet and without duplication: (a) Contractual Debt Payments; (b) Funded Debt Payments; (c) accrued and unpaid property taxes for the Properties, net of any impounds, for the period ending on or prior to the Closing Date; (d) all tenant security deposits; (e) prepaid rents and all other prepayments of amounts due from any tenant under any lease with respect to any period subsequent to the Closing Date; (f) reserves for construction at the Properties commonly known as Superstition

Springs Center and Desert Sky Mall; and (g) restricted cash balances with respect to the Property commonly known as ▇▇▇▇▇▇▇▇ Gateway.

ARTICLE II
THE MERGER; CLOSING

Section 2.1 The Merger.

(a): At the Effective Time (as defined below) and subject to the terms and conditions hereof and the provisions of the Delaware Revised Uniform Limited Partnership Act, 6 Del. C. Section 17-101, et seq. (the "DRULPA"), and in reliance on the representations, warranties and covenants herein set forth, the Company shall merge with Acquisition Sub in accordance with the DRULPA and shall file a certificate of merger substantially in the form of Exhibit B attached hereto (the "Certificate of Merger") with the Secretary of State of the State of Delaware and make all other filings or recordings required by Delaware law in connection with the Merger. The Merger shall become effective at such time as is specified in the Certificate of Merger (the "Effective Time").
(b): At the Effective Time, Acquisition Sub shall be merged with and into the Company, whereupon the separate existence of Acquisition Sub shall cease, and the Company shall be the surviving limited partnership of the Merger (the "Surviving Partnership") in accordance with Section 17-211 of the DRULPA.

Section 2.2 Effects of the Merger. From and after the Effective Time:

(a)

The Merger shall have the effects provided herein and set forth in Section 17-211 of the DRULPA. Without limiting the generality of the foregoing and subject thereto, at the Effective Time, the Surviving Partnership shall succeed to and possess all of the rights, privileges and powers of Acquisition Sub, and all of the assets and property of whatever kind and character of Acquisition Sub shall vest in the Surviving Partnership without further act or deed; thereafter, the Surviving Partnership shall be liable for all of the liabilities and obligations of Acquisition Sub, and any claim or judgment against Acquisition Sub may be enforced against the Surviving Partnership, in accordance with Section 17-211 of the DRULPA.

(b)

The certificate of limited partnership of the Company as in effect immediately prior to the Effective Time shall be the certificate of limited partnership of the Surviving Partnership until amended in accordance with applicable law.

(c)

Promptly following the Effective Time, the Limited Partnership Agreement shall be amended, and such amended Limited Partnership Agreement shall be the partnership agreement of the Surviving Partnership unless and until amended in accordance with its terms and applicable law.

(d)

The name of the Surviving Partnership shall be Westcor Realty Limited Partnership.

(e)

Tax Characterization of the Merger.

(i): Acquisition Sub is owned entirely by the Buyer and by Acquisition GP, an entity that is owned entirely by The Macerich Company and disregarded for federal income tax purposes as a Qualified REIT Subsidiary pursuant to Section 856(i) of the Code. Acquisition Sub is properly characterized as a partnership for federal income tax purposes. Following the Merger, the Company will be owned entirely by the Buyer and Acquisition GP, with the result that the Company will be properly characterized as a partnership for federal income tax purposes following the Merger.

(ii): The Company, the Buyer and Acquisition Sub agree that, pursuant to Treasury Regulation § 1.708-1(c)(3), the Merger shall be treated as an "assets over" form of merger, with the consequences set forth in Treasury Regulation §1.708-1(c)(3)(i). Notwithstanding the foregoing, for federal income tax purposes, the Company, the Buyer and Acquisition Sub agree to treat the payment of cash, as specified in Section 2.4(c) hereof, as the sale by the Partners receiving such cash of their Interests to the Buyer and as a direct purchase by the Buyer of such Interests from such Partners immediately prior to the Merger (and not as a transfer of cash from the Buyer to the Company as part of the Merger). Each Partner who receives, directly or indirectly, any cash in connection with the Merger agrees to treat the Merger and the payment of cash as specified in Section 2.4(c) hereof as the acquisition by the Buyer of the Interests of such Partner in a transaction described in Code Section 741 and Treasury Regulation § 1.708-1(c)(4).

Section 2.3 General Partner Authorization. The general partner of the Surviving Partnership shall be authorized, at such time in its sole discretion as it deems appropriate to execute, acknowledge, verify, deliver, file and record, for and in the name of the Surviving Partnership, and, to the extent necessary, Acquisition GP, the limited partners of Acquisition Sub, Eastrich and the limited partners of the Company, any and all documents and instruments including, without limitation, the partnership agreement of the Surviving Partnership and the Certificate of Merger, and shall do and perform any and all acts required by applicable law that are necessary in order to effectuate the Merger.

Section 2.4 Conversion of Interests. At the Effective Time, by virtue of the Merger and without any action on the part of any party hereto or the holder of any of the following securities:

(a)

Each limited partnership interest in Acquisition Sub outstanding immediately prior to the Effective Time shall be converted into a limited partnership interest in the Surviving Partnership representing a proportionate economic ownership interest in the Surviving Partnership equal to its proportionate economic ownership interest in Acquisition Sub immediately prior to the Effective Time;

(b)

The interest of Acquisition GP in Acquisition Sub shall be converted into a general partnership interest in the Surviving Partnership representing a proportionate economic ownership interest in the Surviving Partnership equal to its proportionate economic ownership interest in Acquisition Sub immediately prior to the Effective Time;

(c)

The Interest of Eastrich and each limited partner in the Company shall be converted into and shall represent the right to receive:

(i): a cash payment in the amount of the Net Purchase Price (as hereinafter defined) multiplied by such Partner's Interest, subject to adjustment pursuant to Section 2.8 hereof (the "Per Interest Cash Payment");
(ii): an interest in the Indemnification Escrow Amount (as hereinafter defined) equal to such Partner's Interest multiplied by the Indemnification Escrow Amount, subject to the terms and conditions of Article VII hereof and the Indemnification Escrow Agreement (as hereinafter defined);
(iii): an interest in the cash, if any, delivered into the Holdback Escrow (as hereinafter defined) or into the control of the Indemnification Representative pursuant to Section 2.7(f) equal to such Partner's Interest multiplied by the aggregate amount of cash delivered into the Holdback Escrow or into the control of the Indemnification Representative pursuant to Section 2.7(f);

(iv): an interest in the Arrowhead Escrow (as hereinafter defined) equal to such Partner's Interest multiplied by the aggregate amount of cash delivered into the Arrowhead Escrow; and
(v): if the Aggregate Additional Amount is positive, a cash payment in the amount of the Aggregate Additional Amount multiplied by such Partner's Interest (the "Per Interest Additional Payment") payable in accordance with Section 2.9 hereof.

(d): Upon conversion of the Interests of the Partners in accordance with Section 2.4(c) hereof, each Partner shall be deemed to have withdrawn as a partner of the Surviving Partnership as of the Effective Time, whereupon each Partner will have no further Interest (or other interest) in the Surviving Partnership, and shall be deemed to have withdrawn any representatives to the Management Committee of the Surviving Partnership.

Section 2.5 Deposits.

(a): Prior to 12:00 p.m. (Arizona time) on the next Business Day following the execution and delivery of this Agreement by all parties hereto, the Buyer shall deliver to US Bank Trust National Association, as escrow agent (the "Escrow Agent"), the sum of Five Million Dollars ($5,000,000) as a non-refundable deposit (the "Signing Deposit"). Prior to 12:00 p.m. (Arizona time) on the next Business Day following the expiration of the Physical Inspection Period (and assuming the Buyer does not exercise its termination rights during the Physical Inspection Period), the Buyer shall deliver to the Escrow Agent the sum of Twenty Million Dollars ($20,000,000) (the "Physical Inspection Deposit", and together with the Signing Deposit, the "Deposits"). The Deposits shall be held in escrow by the Escrow Agent in an interest-bearing account pursuant to and in accordance with the escrow agreement in the form of Exhibit C attached hereto and executed concurrently with this Agreement (the "Deposit Escrow Agreement"). Subject to the terms and conditions set forth in Article VIII with respect to the termination of this Agreement, the Deposits, together with any income earned thereon, shall be delivered to the Escrow Agent at the Closing as a credit against the Indemnification Escrow Amount pursuant to Section 2.7(d) below. Any Taxes (as hereinafter defined) due on any income earned on the Deposit shall be the responsibility of the party that receives such income, subject to the terms and as set forth in the Indemnification Escrow Agreement.
(b): As an alternative to making any or all of the Deposits in cash, the Buyer may elect to deliver to the Escrow Company one or more irrevocable, clean standby letters of credit in the amount of such Deposit (each a "Deposit L/C"). Each Deposit L/C shall be (i) in a form reasonably acceptable to the Company and (ii) issued in favor of the Escrow Agent.

Section 2.6 Closing. The closing of the transactions contemplated by this Agreement (the "Closing") shall be held at the offices of ▇▇▇▇▇▇▇ Procter LLP, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇, at 10:00 a.m. (local time) on the date that is five (5) Business Days following the date on which the conditions set forth herein with respect thereto shall be satisfied or duly waived or such other place or date as may be fixed by mutual agreement of the Buyer and the Company. The date on which the Closing is actually held hereunder is sometimes referred to herein as the "Closing Date."

Section 2.7 Actions at Closing. Subject to the terms and conditions set forth in this Agreement, at the Closing:

(a): the Company shall deliver to the Buyer and Acquisition Sub the various certificates, instruments and documents referred to in Section 6.3;
(b): the Buyer and Acquisition Sub shall deliver to the Company the various certificates, instruments and documents referred to in Section 6.2;

(c): the Surviving Partnership shall file with the Secretary of State of the State of Delaware the Certificate of Merger;
(d): the Escrow Agent shall retain the Deposits and any income earned thereon and hold such amounts in escrow (such aggregate amounts the "Indemnification Escrow Amount" in interest-bearing accounts pursuant to and in accordance with the terms and provisions of the escrow agreement to be executed at the Closing in the form of Exhibit D attached hereto (the "Indemnification Escrow Agreement") for the purpose of securing (i) the obligations of the Partners under Section 2.8(d) hereof to pay the Balance Sheet Adjustment Amount, if any, to the Buyer, and (ii) the indemnification obligations of the Partners set forth in Article VII of this Agreement. The Indemnification Escrow Amount shall be held as trust funds and shall not be subject to any lien, attachment, trustee process or any other judicial process of any creditor of any party, and shall be held and disbursed solely for the purposes and in accordance with the terms of the Indemnification Escrow Agreement;
(e): the Buyer shall deliver to each of the Partners by wire transfer of immediately available funds, pursuant to the wiring instructions for such Partner delivered within two (2) Business Days prior to the Closing, the Per Interest Cash Payment for such Partner, which funds shall, in the aggregate, equal Seven Hundred Forty Two Million Dollars ($742,000,000) less the Indemnification Escrow Amount, the amount of the Arrowhead Escrow, and the amount paid into the Holdback Escrow or into the control of the Indemnification Representative pursuant to Section 2.7(f) hereof, which amount so reduced is further subject to adjustment pursuant to Section 2.8 hereof (the "Net Purchase Price");
(f): pursuant to written notice and instruction of the Company, which notice shall be delivered no later than five (5) Business Days prior to the Closing Date, the Buyer shall deliver at Closing by wire transfer of immediately available funds, cash in an amount specified in such notice into the Holdback Escrow or into the control of the Indemnification Representative in accordance with the written instructions provided by the Company in such notice; and
(g): unless otherwise agreed in writing by the Buyer and the Company, the Buyer shall deliver by wire transfer of immediately available funds, cash in an amount equal to Five Hundred Thousand Dollars ($500,000) into an escrow account established by the Company and the Buyer and subject to the general terms and conditions applicable to the Indemnification Escrow Amount under the Indemnification Escrow Agreement, but which shall be an escrow account separate from the other Indemnification Escrow Amounts (such escrow arrangement, the "Arrowhead Escrow").

Section 2.8 Pre-Closing Distribution; Balance Sheet Adjustment.

(a): Pre-Closing Distributions. The parties hereto acknowledge and agree that, prior to the Closing Date, the Company shall cause each Affiliated Property Owner and each Subsidiary to distribute to such entities' partners or members, as applicable, all cash and cash equivalents of such Affiliated Property Owner or Subsidiary other than Retained Cash, and the Company shall distribute, subject to the following sentence, to the Partners all of its cash and cash equivalents other than Retained Cash; provided that no such distribution shall be in violation of any loan agreement or other contractual restriction on the distribution of funds, or the covenant regarding construction loans contained in Section 5.1 hereof (such distributions, the "Pre-Closing Distributions"). Unless otherwise agreed in writing by the Buyer, the Company and the Indemnification Representative (on behalf of the Partners), the Company shall make the Pre-Closing Distributions to the Partners by delivering (on behalf of the Partners), by wire transfer in immediately available funds, all such Pre-Closing Distributions to the Adjustment Escrow, whereupon such Pre-Closing Distributions shall be and shall be deemed to be the

Adjustment Escrow Amount (or a portion thereof, as the case may be) and subject to the terms and conditions of Section 2.8(d) hereof and the Indemnification Escrow Agreement.

(b): Purchase Price Adjustment. Prior to the Closing Date, the Company shall in good faith prepare, with the assistance of the Buyer, an estimated balance sheet for each Affiliated Property Owner and Acquired Company as of the Closing Date after taking into account the Pre-Closing Distributions (the "Estimated Closing Date Balance Sheets"). The Estimated Closing Date Balance Sheets shall be prepared in accordance with GAAP consistently applied, and otherwise consistent with the methodology used to prepare such entity's most recent regularly prepared balance sheet. Not later than five (5) Business Days prior to the Closing Date, the Company shall deliver to the Buyer the Estimated Closing Date Balance Sheets, together with worksheets and data that support the Estimated Closing Date Balance Sheets and any other information that the Buyer may reasonably request in order to verify the amounts reflected on the Estimated Closing Date Balance Sheets. The Net Purchase Price to be paid at the Closing shall be adjusted as follows: (i) the Net Purchase Price paid at the Closing shall be increased, dollar for dollar, to the extent that the aggregate Balance Sheet Adjustment Amounts shown on the Estimated Closing Date Balance Sheets for all Acquired Companies and Affiliated Property Owners is positive, by the Balance Sheet Adjustment Amount; and (ii) the Net Purchase Price paid at Closing shall be decreased, dollar for dollar, to the extent that the aggregate Balance Sheet Adjustment Amounts shown on the Estimated Closing Date Balance Sheets for all Acquired Companies and Affiliated Property Owners is negative, by the absolute value of the Balance Sheet Adjustment Amount.
(c): Confirmation of Purchase Price Adjustment. As soon as practical after the Closing Date, Ernst and Young LLP (the "Accountant") shall review the Company's books and records and also shall review the Estimated Closing Date Balance Sheets in accordance with GAAP consistently applied and otherwise consistent with the methodology used to prepare such entity's most recent regularly prepared balance sheet (taking into account the Pre-Closing Distributions) and make any adjustments necessary thereto (the "Post-Closing Audited Balance Sheets") consistent with the provisions of this Section 2.8. The Company shall pay all fees and expenses of the Accountant, which shall be paid (unless otherwise off-set), from the Indemnification Escrow Amount in accordance with the terms of the Indemnification Escrow Agreement, and, in all events, shall be accounted for as a credit against the Net Purchase Price. The Accountant shall, within forty-five (45) days following the Closing Date, deliver the Post-Closing Audited Balance Sheets to the Indemnification Representative and the Buyer, together with worksheets and data that detail any adjustments and the basis thereof and any other information that the Indemnification Representative may reasonably request in order to verify the amount of any such adjustments. The Post-Closing Audited Balance Sheets, and the Balance Sheet Adjustment Amount attributable to each Affiliated Property Owner and Acquired Company at the Closing reflected on the Post-Closing Audited Balance Sheet applicable to such entity, shall be binding upon the parties upon approval by the Indemnification Representative and the Buyer of such Post-Closing Audited Balance Sheets. If the Indemnification Representative and the Buyer do not both approve of the Post-Closing Audited Balance Sheets and the calculation of the Balance Sheet Adjustment Amount attributable to each Affiliated Property Owner and Acquired Company at the Closing stated thereon, and the Buyer and the Indemnification Representative cannot mutually agree on any proposed modifications, then within the later of (i) sixty (60) days after the Closing Date and (ii) fifteen (15) days following receipt by the Indemnification Representative and the Buyer of the Post-Closing Audited Balance Sheets, the Buyer and the Indemnification Representative shall select a nationally recognized independent accounting firm with no affiliation to the Buyer, the Company or the Indemnification Representative and who is mutually satisfactory to the Buyer and the Indemnification Representative to resolve such dispute (the "Neutral

Auditor"), and shall submit in writing to the Neutral Auditor their respective positions with respect to the Post-Closing Audited Balance Sheets and the calculation of the Balance Sheet Adjustment Amount attributable to each Affiliated Property Owner and Acquired Company at the Closing. The Neutral Auditor shall review the Post-Closing Audited Balance Sheets and, within ten (10) Business Days of its appointment, shall make any adjustments necessary thereto, and, upon completion of such review, such Post-Closing Audited Balance Sheets and the Balance Sheet Adjustment Amount at the Closing for each Affiliated Property Owner and Acquired Company stated thereon as determined by the Neutral Auditor shall be binding upon the parties. The fees and expenses associated with such a review shall be borne by the non-prevailing party, which shall be the party whose written position submitted to the Neutral Auditor is, furthest from that determined by the Neutral Auditor.

(d)

Payment of Balance Sheet Adjustment Amount.

(i)

In the event the Balance Sheet Adjustment Amount Differential is negative, the Buyer and the Indemnification Representative jointly shall authorize and direct the Escrow Agent to pay, on behalf of each Partner, to the Buyer, by check or wire transfer of immediately available funds, to the extent available in the Adjustment Escrow Amount, an amount equal to the absolute value of the Balance Sheet Adjustment Amount Differential multiplied by such Partner's Interest. Such authorization and direction shall instruct the Escrow Agent to make such payments within four (4) Business Days following delivery to each Partner and the Escrow Agent of joint notice from the Buyer and the Indemnification Representative as to the determination of Balance Sheet Adjustment Amount Differential in accordance with this Section 2.8.

(A): If the Adjustment Escrow Amount exceeds the Balance Sheet Adjustment Amount Differential, concurrently with the Buyer's and the Indemnification Representative's delivery of such joint authorization and direction, the Buyer and the Indemnification Representative shall deliver to the Escrow Agent a joint notice and instruction directing the Escrow Agent to pay to each Partner, by check or wire transfer of immediately available funds, an amount equal to (1) the Adjustment Escrow Amount Differential less the Balance Sheet Adjustment Amount Differential, multiplied by (2) such Partner's Interest. All such disbursements shall be paid contemporaneously with the payment of the Balance Sheet Adjustment Amount to the Buyer.
(B): If the Balance Sheet Adjustment Amount Differential exceeds the Adjustment Escrow Amount, each Partner shall severally, but not jointly, indemnify the Buyer with respect to any shortfall, in an amount equal to the aggregate amount of such shortfall multiplied by such Partner's Interest (the amount of such payment with respect to any Partner, such Partner's "Additional Adjustment Payment"). At the Buyer's option, the Buyer shall be entitled to request payment of, and the Escrow Agent shall pay, the entire amount of all Additional Adjustment Payments (but not less than such entire amount) from the Indemnification Escrow Amount, and each Partner shall be obligated to repay promptly the amount of its Additional Adjustment Payment, together with any accrued interest, to the Indemnification Escrow Amount. The Indemnification Representative shall cooperate with the Buyer and the Escrow Agent in seeking repayment of any such funds to the Indemnification Escrow Amount.

(ii): In the event Balance Sheet Adjustment Amount Differential is positive, the Buyer shall, within four (4) Business Days following the determination of Balance Sheet Adjustment Amount Differential in accordance with Section 2.8(c) above, (A) pay to each of the Partners an amount equal to the Balance Sheet Adjustment Amount Differential

multiplied by such Partner's Interest by wire transfer of immediately available funds in accordance with the wire transfer instructions provided to the Buyer prior to the Closing (unless such wire transfer instructions are subsequently updated or amended by any particular Partner and confirmed by the Buyer with the Indemnification Representative prior to wiring) and (B) deliver to the Escrow Agent, with Indemnification Representative, a joint notice and instruction, authorizing and directing the Escrow Agent to pay to the Partners the amount of the Adjustment Escrow Amount and any investment income earned thereon, in accordance with the terms of the Indemnification Escrow Agreement.

Section 2.9 Additional Payment.

(a)

The Aggregate Additional Amount shall be paid as set forth in clause (i) of this Section 2.9(a) to the extent that it exceeds zero, and as set forth in clause (ii) of this Section 2.9(a) to the extent it is less than zero. If the Aggregate Additional Amount is zero, no party shall have any payment obligation under this Section 2.9(a).

(i): The Per Interest Additional Payment shall be paid by the Buyer to the Partners on March 15, 2003 by wire transfer of immediately available funds in accordance with the wire transfer instructions provided to the Buyer prior to the Closing (unless such wire transfer instructions are subsequently updated or amended by any particular Partner) and confirmed by the Buyer with the Indemnification Representative (as hereinafter defined) prior to wiring. To the extent that any Percentage Rent is owed to, but has not been actually received by, or directly or indirectly credited for the account of, the Buyer or any of its Affiliates or their respective successors or assigns prior to March 15, 2003, the Buyer will make additional Per Interest Additional Payments to the Partners promptly (but in no event more often than quarterly) following the receipt by (or direct or indirect crediting for the account of) the Buyer or any of its Affiliates or their respective successors or assigns of all or any portion of such Percentage Rent so paid or credited on or after March 15, 2003 in the amount necessary to increase the total payments received by each Partner pursuant to this Section 2.9 to the amount of such Partner's Per Interest Additional Payment calculated as if such Percentage Rent had been received (or credited) timely. (It being understood that any additional payments made pursuant to the preceding sentence shall be considered and deemed to be part of the "Aggregate Additional Amount" and, with relation to any Partner, part of the Per Interest Additional Payments of such Partner for all purposes under this Agreement.) At the time of such payment, the Buyer shall concurrently deliver to each Partner a statement showing the method used to compute the Aggregate Additional Amount and the Per Interest Additional Payment, certified by the chief financial officer of the Buyer as true and correct, together with reasonable back-up data for such computation (the "Statement") and shall also deliver to the Indemnification Representative such additional back-up data or documents as the Indemnification Representative from time to time may reasonably request in connection with the computation of the Aggregate Additional Amount.
(ii): Each Partner shall, severally and not jointly, indemnify the Buyer for an amount equal to such Partner's Interest multiplied by the absolute value of the amount by which the Aggregate Adjustment Amount is less than zero, which right of indemnification shall be satisfied solely by recourse to the Indemnification Escrow Amount and shall otherwise be subject to the terms and conditions of Article VII hereof other than the Threshold Amount in Section 7.2(b); provided that in no case shall the aggregate obligation of the Partners under this Section 2.9(a)(ii) exceed $2,000,000.

(b): The Buyer agrees to keep accurate records sufficient for the tracking of the Percentage Rent with respect to calendar year 2002 and computation of the Aggregate Additional Amount. The parties agree that they will keep each other informed as to the status of Percentage Rent collected and cooperate reasonably in good faith and jointly attempt to resolve any disputes with tenants regarding the Percentage Rent owed by them. Following receipt of the Statement, the Indemnification Representative shall have a right to conduct a limited audit of the Buyer or any of its Affiliates or their respective successors or assigns solely for the purpose of determining the amount of Percentage Rents collected by (or directly or indirectly credited for the account of) the Buyer or any of its Affiliates or their respective successors or assigns with respect to calendar year 2002 and the Aggregate Additional Amount, subject to the condition that such audit be conducted upon reasonable advance notice during normal business hours. To the extent that the Buyer or any of its Affiliates effectively assigns its right to receive any Percentage Rents with respect to calendar year 2002, the Buyer shall provide in the agreements relating to such transfer a continuing right of the Indemnification Representative to conduct the foregoing limited audit for the purpose of determining the amount of such collected or credited Percentage Rents.
(c): In the event that the Indemnification Representative disputes the calculation of the Aggregate Additional Amount, the Indemnification Representative shall deliver to the Buyer a written notice of objection (an "Objection Notice") within twenty (20) days following receipt of the Statement or the receipt of such additional back-up data or documents as the Indemnification Representative may have reasonably requested in connection therewith, as applicable, which notice shall include a statement showing the Indemnification Representative's method of computing the Aggregate Additional Amount and reasonable back-up data or documents to support the objection. During the fifteen (15) days following delivery of an Objection Notice, the Indemnification Representative and the Buyer shall in good faith attempt to resolve their differences with respect to the computation of the Aggregate Additional Amount. If the parties are unable to resolve their differences within such period, the matter will be referred as promptly as practicable to a nationally recognized independent accounting firm with no affiliation to the Buyer, the Company or the Indemnification Representative, selected by mutual agreement of the Buyer and the Indemnification Representative. Such accounting firm (the "Arbiter") shall make a determination as to the appropriate computation of the Aggregate Additional Amount and the Per Interest Additional Payments, which determination will be (i) in writing, (ii) furnished to the Buyer and the Indemnification Representative as soon as practicable following referral of the matter, (iii) made in accordance with this Agreement, and (iv) conclusive, binding and non-appealable, in the absence of fraud or manifest error, upon the Buyer, the Surviving Partnership, the Indemnification Representative and each of the Partners. Subject to a confidentiality agreement reasonably acceptable to the Buyer, the Arbiter shall have such access to the financial books and records of the Buyer or any of its Affiliates or their respective successors or assigns as is reasonably necessary to complete its evaluation. The Buyer shall promptly pay to the Partners any additional funds finally determined to have been owed as part of the Per Interest Additional Payments pursuant to this Section 2.9. The expenses of the Arbiter shall be borne by the non-prevailing party.

Section 2.10 Physical Inspection Period. The Buyer shall have the period beginning on the date of this Agreement and ending on the thirtieth (30^th) day following the date hereof (such period, the "Physical Inspection Period") to complete its physical and environmental inspections of the Properties, and the Buyer shall promptly provide to the Company a copy of any physical or environmental inspection report or similar report it obtains in connection with such inspections. If, but only if, a physical or environmental inspection report obtained by the Buyer and provided to the Company discloses a structural, building system or other physical or environmental deficiency or liability in the

Properties that is not disclosed in the physical condition or environmental reports included in the Review Room (as hereinafter defined) and that would reasonably be expected to cost in excess of $20,000,000 (in the aggregate if there is more than one such deficiency) to remedy, then (a) the Buyer shall be entitled to terminate this Agreement by giving written notice to the Company (the "Termination Notice"), with a copy to the Escrow Agent, which Termination Notice shall specify the grounds for such termination and which must be received by the Company by 5:00 p.m. (Arizona time) on the last day of the Physical Inspection Period, and (b) the Company and the Buyer shall have no further obligations or liabilities to each other hereunder, except as otherwise stated herein. If the Buyer does not give a Termination Notice to the Company prior to the expiration of the Physical Inspection Period, then the Buyer's right to terminate this Agreement pursuant to this Section 2.10 shall automatically expire and be of no further force or effect.

Section 2.11 Alternative Transaction Structures. The parties hereby acknowledge that it is their intent following execution of this Agreement to pursue amending or amending and restating this Agreement (and, to the extent applicable, any exhibits or schedules hereto) in order to modify the structure of the transactions in accordance with the terms and otherwise as set forth on the sheet attached hereto as Exhibit G (any such alternatively structured transaction, the "Restructured Transaction") subject, however, to obtaining any required third-party consents thereto and, to the extent necessary, the execution of documents required to implement the Restructured Transaction by Partners. For the purposes of effectuating the foregoing intent, the parties agree to cooperate in good faith to negotiate and prepare all necessary amendments to this Agreement and other agreements, instruments and other documents agreed by the parties hereto to be necessary or appropriate to consummate such Restructured Transaction prior to the expiration of the Physical Inspection Period; provided, however, that, in the event that the parties hereto are unable for any reason whatsoever to complete such negotiations and preparations or to obtain required third-party consents or the signature of any Partner required to implement the Restructured Transaction, in each case on or prior to the expiration of the Physical Inspection Period, this Section 2.11 and Exhibit G shall terminate and be of no further force and effect and the parties shall proceed with the Merger in the form and on the terms agreed on the date hereof and subject only to the terms and conditions of this Agreement.

Section 2.12 Proposed Development Properties Transactions. The parties hereto acknowledge that it is the intent of the Buyer and certain current employees of the Company to pursue a transaction, the material terms of which are set forth on the term sheet attached hereto as Exhibit H, following the Closing and consummation of the Merger and other transactions contemplated in this Agreement; provided, however, that the consummation of the transaction described in such term sheet shall not constitute a condition to the Closing and consummation of the Merger and the other transactions contemplated in this Agreement.

Section 2.13 Time of the Essence. The parties hereto acknowledge and agree that, subject only to the express adjournment rights contained herein, time is of the essence in consummating the Merger and the delivery of the Net Purchase Price.

ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY

As a material inducement to the Buyer and Acquisition Sub to enter into this Agreement and to consummate the transactions contemplated hereby, the Company represents and warrants to the Buyer and Acquisition Sub as follows:

Section 3.1 Capitalization. Exhibit A constitutes a complete and accurate list of all Partners and the percentage of the total outstanding Interests held by each Partner, which constitutes all the holders of all the Interests. The Interests and all of the issued and outstanding equity interests in the Subsidiaries have been duly authorized and validly issued and, to the Company's Knowledge, are free

and clear of any and all Encumbrances (except for federal and state securities law restrictions of general applicability and certain transfer restrictions set forth in the Limited Partnership Agreement). Except as set forth on Schedule 3.1, there are no contracts or commitments relating to the issuance, sale or transfer of any equity securities or other securities of any Acquired Company, including, without limitation, options, warrants, call rights or preemptive rights. None of the outstanding equity securities or other securities of any Acquired Company was issued in violation of the Securities Act of 1933 (the "Securities Act") or other state securities laws. Except as set forth on Schedule 3.1, no Acquired Company owns, or has any contract to acquire, any equity securities or other securities of any Person (other than the Acquired Companies or the Affiliated Property Owners) or any direct or indirect equity or ownership interest in any other business. Except as set forth on Schedule 3.1, there are no voting trusts, equity holder agreements or understandings in effect with respect to the voting or transfer of the Interests, or any other securities of, or equity interests in, any Acquired Company.

Section 3.2 Organization of Acquired Companies; Authority.

(a): Organization of Acquired Companies. Schedule 3.2(a) contains a complete and accurate list for each Acquired Company of its name, its jurisdiction of organization, other jurisdictions in which it is authorized to do business, and its capitalization (including the identity of each equity holder and the percentage interest held by each). Each Acquired Company is an entity duly organized, validly existing and in good standing under the laws of its jurisdiction of organization and has all the requisite limited liability company or partnership, as applicable, power and authority to carry on its business as now being conducted and to own, operate and lease the Properties currently owned, operated and leased by it. Each of the Acquired Companies is qualified to do business and is in good standing in each jurisdiction in which the nature of its business requires it to be so qualified, except to the extent the failure to so qualify would not, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect (as hereinafter defined). The Company has delivered to the Buyer complete and correct copies of the partnership agreements or limited liability company agreements of each of the Acquired Companies, which are in full force and effect as of the date hereof. Schedule 3.2(a) lists all current appointed and acting officers and directors of each Acquired Company on the date of this Agreement.
(b): Authority. The Company has full authority, right, power and capacity to enter into this Agreement and each agreement, document and instrument to be executed and delivered by or on behalf of the Company pursuant to or as contemplated by this Agreement and to carry out the transactions contemplated hereby and thereby. The execution, delivery and performance by the Company of this Agreement and each such other agreement, document and instrument have been duly authorized by all necessary action of the Company, and no other action on the part of the Company is required in connection therewith. This Agreement and each agreement, document and instrument to be executed and delivered by the Company pursuant to or as contemplated by this Agreement constitute, or when executed and delivered will constitute, valid and binding obligations of the Company, enforceable in accordance with their respective terms, except as the same may be limited by bankruptcy, insolvency, reorganization, moratorium or other laws affecting the rights of creditors generally and subject to the rules of law governing (and all limitations on) specific performance, injunctive relief and other equitable remedies. Except as provided in Schedule 3.2(b), and except as may result from any facts or circumstances relating solely to the Buyer (including, without limitation, its sources of financing), and assuming that all consents, approvals, authorizations and other actions set forth on Schedule 3.6 have been obtained and all filings and notifications set forth on Schedule 3.6 have been made, the execution, delivery and performance by the Company of this

Agreement and each such other agreement, document and instrument pursuant to or as contemplated by this Agreement:

(i): do not and will not violate the governing documents of any of the Acquired Companies or the Affiliated Property Owners;
(ii): do not and will not violate any laws of the United States, or any state or other jurisdiction applicable to any Acquired Company or Affiliated Property Owner require any Acquired Company or Affiliated Property Owner to obtain any approval, consent or waiver of, or make any filing with, any Person (governmental or otherwise) that has not been obtained or made, except for such violations as would not reasonably be expected to have a material adverse effect on any Acquired Company, Affiliated Property Owner or Property; and
(iii): do not and will not result in a material breach of, constitute a material default under, accelerate any material obligation under or give rise to a material right of termination of any indenture or loan or credit agreement or any other agreement, contract, instrument, mortgage, lien, lease, permit, authorization, order, writ, judgment, injunction, decree, determination or arbitration award to which any Acquired Company or Affiliated Property Owner is a party or by which any of the Properties is bound or affected, or result in the creation or imposition of any material Encumbrance on any of the assets or properties of any Acquired Company or Affiliated Property Owner.

Section 3.3 Affiliated Property Owners. Schedule 3.3 contains a complete and accurate list for each Affiliated Property Owner of its name, its jurisdiction of organization, other jurisdictions in which it is authorized to do business, and its capitalization (including the identity of each equity holder that is an Acquired Company and the percentage interest held by such holders and, to the Company's Knowledge, the identity of each other equity holder and the percentage interest held by such holders). Each Affiliated Property Owner is an entity duly organized, validly existing and in good standing under the laws of its jurisdiction of organization and has all the requisite limited liability company or partnership power, as applicable, and authority to carry on its business as now being conducted and to own, operate and lease the properties owned, operated and leased by it. Each of the Affiliated Property Owners is qualified to do business and is in good standing in each jurisdiction in which the nature of its business requires it to be so qualified, except to the extent the failure to so qualify would not, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. No Acquired Company is and, to the Company's Knowledge, no equity holder of an Affiliated Property Owner that is not an Acquired Company is, in default of its obligations under the partnership or limited liability company agreement or other governing document for the Affiliated Property Owner of which it is an equity holder. There are no pending capital calls or capital calls currently being contemplated in the foreseeable future with respect to any Affiliated Property Owner other than the equity required to fund (as reflected in the Budget) the development of the Property commonly known as Scottsdale 101.

Section 3.4 Financial Statements; Undisclosed Liabilities.

(a): Attached hereto as Schedule 3.4 is (i) the audited consolidated balance sheet as of December 31, 2001, 2000 and 1999 and statements of income, changes in partnership equity and cash flows of the Company and its Subsidiaries for the years ended December 31, 2001, 2000 and 1999 and (ii) the unaudited consolidated balance sheet as of March 31, 2002 (the "Most Recent Balance Sheet") and statements of income, changes in partnership equity and cash flows of the Acquired Companies and the Affiliated Property Owners for the three months ended March 31, 2002 (collectively, the "Financial Statements"). Such Financial Statements fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of the respective dates thereof and for the periods referred

to therein and are consistent with the books and records of the Company. The Financial Statements have been prepared in accordance with GAAP applied on a consistent basis throughout the periods covered thereby, except as noted therein and for the fact that the unaudited financial statements may not include footnotes normally contained therein and are subject to normal year-end adjustments.

(b): As of the date hereof, except as set forth on Schedule 3.4, the Acquired Companies and Affiliated Property Owners have no liabilities (whether known or unknown, whether absolute or contingent, whether liquidated or unliquidated and whether due or to become due), except for (i) liabilities stated or adequately reserved against on the Most Recent Balance Sheet, (ii) liabilities that arose in the ordinary course of business after the date of the Most Recent Balance Sheet substantially consistent with past practice, (iii) liabilities resulting from routine litigation arising in the ordinary course of the Acquired Companies' or the Affiliated Property Owners' business or that are adequately covered by insurance, (iv) any liability that would not reasonably be expected to exceed $100,000 individually, and (v) liabilities under the Acquired Companies' existing contracts and agreements disclosed pursuant to Section 3.12(a) hereof but not required to be disclosed pursuant to GAAP.

Section 3.5 Absence of Certain Changes. Except as set forth on Schedule 3.5, since March 31, 2002, the Acquired Companies and the Affiliated Property Owners have operated only in the ordinary course of business consistent with past practice and there has not been any of the following:

(a): any declaration, setting aside or payment of any distribution (whether in cash, partnership interests or property) to the holders of the Interests other than distributions in the ordinary course of business consistent with past practice and the distributions contemplated by Section 2.8 hereof;
(b): any amendment of the Limited Partnership Agreement or other organizational or governing document of any Acquired Companies or any Affiliated Property Owners;
(c): any redemption, repurchase or other acquisition of any Interests by the Company or any issuance of any equity interests or other securities (including any grant or issuance of any options, call, warrants or other rights or agreements relating to such issuance);
(d): any change in, or effect on, the Acquired Companies or the Affiliated Property Owners or other event, damage or destruction relating to the business of the Acquired Companies, the Affiliated Property Owners or the Properties that has had, or would reasonably be expected to have, a Material Adverse Effect;
(e): incurrence of material amount of indebtedness or a guarantee of a material amount of indebtedness or other liability of any unaffiliated third party by any Acquired Company or Affiliated Property Owner;
(f): change in the accounting methods or principles used by the Company (with respect to the assets, liabilities, financial condition or results of operations of any Acquired Company), except for such adjustments as required by GAAP or any change in any tax method or election by any Acquired Company;
(g): any revaluation by any of the Acquired Companies or the Affiliated Property Owners of any of their assets, including writing off of notes or accounts receivable other than in the ordinary course of business;
(h): any increase in, establishment of or amendment of any Benefit Plans or Employment Agreements, other than as set forth on Schedule 3.9, or any other increase in compensation payable or to become payable to any present or former directors, officers or key employees of

any Acquired Company other than in the ordinary course of business consistent with past practice;

(i): any sale or Encumbrance of the Properties or other assets of the Acquired Companies or the Affiliated Property Owners other than in the ordinary course of business; or
(j): any material obligation or liability incurred by any of the Acquired Companies or Affiliated Property Owners other than in the ordinary course of business.

Section 3.6 Consents and Approvals.

(a): To the Company's Knowledge, except as set forth on Schedule 3.6, the execution, delivery and performance of this Agreement by the Company will not, as of the Closing Date, require any consent, approval, authorization or other action by, or filing with or notification to, any federal, state, local, or any foreign government, governmental, regulatory or administrative authority, agency or commission or any court, tribunal, or judicial or arbitral body (each, a "Governmental Authority"), except (i) the notification requirements of the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976, as amended (the "HSR Act"), if applicable, (ii) where the failure to obtain such consent, approval, authorization or action, or to make such filing or notification, would not (A) delay or prevent the consummation of the transactions contemplated by this Agreement or (B) have a material adverse effect on the ability of the Company to perform its obligations under this Agreement, and (iii) as may be necessary as a result of any facts or circumstances relating solely to the Buyer (including, without limitation, its sources of financing).
(b): Except as set forth on Schedule 3.6, the execution, delivery and performance of this Agreement by the Company will neither, as of the Closing Date, require any third-party consents, approvals, authorizations or actions, nor trigger any rights of first offer or first refusal, buy/sell rights, put rights or other preferential rights in favor of third parties owning direct or indirect equity interests in Affiliated Property Owners, except (i) where the failure to obtain such consent, approval, authorization or action would not (A) delay or prevent the consummation of the transactions contemplated by this Agreement or (B) have a material adverse effect on the ability of the Company to perform its obligations under this Agreement and (ii) as may be necessary as a result of any facts or circumstances relating solely to the Buyer (including, without limitation, its sources of financing).

Section 3.7 Litigation. To the Company's knowledge, except as set forth on Schedule 3.7, except for routine litigation arising in the ordinary course of the Acquired Companies' or the Affiliated Property Owners' business or that is adequately covered by insurance, there is no action, suit or proceeding, claim, arbitration or investigation against an Acquired Company or Affiliated Property Owner pending or, to the Company's Knowledge, threatened in writing.

Section 3.8 Taxes

(a)

Except as set forth on Schedule 3.8:

(i): The Acquired Companies and the Affiliated Property Owners have paid or caused to be paid and will as of the Closing Date pay or cause to be paid all Taxes required to be so paid by the Acquired Companies or the Affiliated Property Owners, as applicable, prior to the date of this Agreement and prior to the Closing Date, have made adequate accruals, in accordance with GAAP, for all Taxes owed or accrued by the Acquired Companies or the Affiliated Property Owners, as applicable, through the date of this Agreement.
(ii): The Acquired Companies and the Affiliated Property Owners have timely filed or been included in, or will timely file or be included in, all Tax Returns (as hereinafter defined)

required to be filed by them or in which they are required to be included with respect to Taxes for any period ending on or before the date of this Agreement and which such Tax Returns are due on or before the Closing Date, taking into account any extension of time to file granted to or obtained on behalf of the Acquired Companies or the Affiliated Property Owners, as applicable. All such filed Tax Returns are complete and accurate in all material respects.

(iii): Neither the Internal Revenue Service (the "IRS") nor any other Governmental Authority is asserting as of the date of this Agreement or the Closing by written notice to the Acquired Companies or the Affiliated Property Owners or, to the Company's Knowledge, is threatening in writing as of the date of this Agreement, to assert against the Acquired Companies or the Affiliated Property Owners, any deficiency, assessment or claim for any material amount of additional Taxes.
(iv): No federal, state, local or foreign audits or other administrative proceedings or court proceedings are pending or, to the Company's Knowledge, threatened with regard to any Taxes or Tax Returns of any of the Acquired Companies or the Affiliated Property Owners and none of the Acquired Companies or the Affiliated Property Owners has received a written notice prior to the date of this Agreement of any actual or threatened audits or proceedings or is otherwise aware of any such audits or proceedings.
(v): There are no agreements, waivers or arrangements currently in effect that extend the statutory period of limitations applicable to any claim for, or the period for the collection or assessment of, Taxes due from the Acquired Companies or the Affiliated Property Owners for any taxable period, and no powers of attorney have been granted by or with respect to the Acquired Companies or the Affiliated Property Owners with respect to Taxes that are currently in force. No closing agreement pursuant to Section 7121 of the Code (or any predecessor provision) or any similar provision of any state, local or foreign law has been entered into by the Acquired Companies or the Affiliated Property Owners that is currently in force or effect.
(vi): None of the Acquired Companies has been a member of an affiliated group filing a consolidated federal income Tax Return (other than a group the common parent of which was the Company).
(vii): None of the Acquired Companies is a party to any Tax sharing, Tax indemnity or other agreement or arrangement with any Person, or has actual or potential liability for any Taxes as a result of transactions, events or undertakings occurring prior to the Closing.
(viii): No power of attorney granted by any of the Acquired Companies is currently in force with respect to any matter relating to Taxes of any of the Acquired Companies.
(ix): There are no outstanding or pending requests for rulings, determinations, letters or similar administrative pronouncements issued (or to be issued) by a Governmental Authority with respect to Taxes that will be (or if issued would be) binding upon any of the Acquired Companies or the Affiliated Property Owners after the Closing.
(x): All Taxes that any Acquired Company or Affiliated Property Owner is required by law to withhold or collect for payment have been duly withheld and collected, and have been paid or accrued, reserved against and added on the books of the applicable Acquired Company or Affiliated Property Owner. Each Acquired Company and Affiliated Property Owner has complied in all material respects with all information reporting and backup withholding requirements, including maintenance of required records with respect thereto, in connection with amounts owing to any employee, independent contractor, creditor, equity holder or other third party.

(b): "Taxes" shall mean (i) any and all taxes, charges, fees, levies or other assessments, including, without limitation, income, gross receipts, excise, real or personal property, sales, withholding, social security, retirement, employment, unemployment, occupation, disability, service, use, license, net worth, payroll, franchise, transfer, employee, gift, recapture, estimated, alternative minimum, add-on minimum, value-added, severance, premium, profit, windfall profit, customs, duties, capital stock, stamp, registration and recording taxes, fees, charges, levies or assessments imposed by the IRS or any taxing authority (whether domestic or foreign including, without limitation, any state, county, local or foreign government or any subdivision or taxing agency thereof (including a United States possession)), whether computed on a separate, consolidated, unitary, combined or other basis; and such term shall include any interest whether paid or received, fines, penalties or additional amounts attributable to, or imposed upon, or with respect to, any such taxes, charges, fees, levies or other assessments, and (ii) any liability of any Acquired Company for the payment of amounts with respect to any Tax described in clause (i) whether imposed by Law, contractual agreement or otherwise, including liabilities imposed as a result of being a member of an affiliated, consolidated, combined or unitary group, a transferee of or successor to any Person, or a party to any tax sharing arrangement or tax indemnity arrangement.

"Tax Return" shall mean any report, return, document, declaration or other information or filing required to be supplied to any taxing authority or jurisdiction (foreign or domestic) with respect to Taxes, including, without limitation, information returns, any document, with respect to or accompanying payments of estimated taxes, or with respect to or accompanying requests for the extension of time in which to file any such, report, return, document, declaration or other information.

Section 3.9 Employee Benefit Plans. All of the employee benefit plans and other similar programs and arrangements, including any plans or arrangements providing for "fringe benefits" or perquisites, maintained for the benefit of any current or former employee, partner, agent, officer or director or any dependents or beneficiaries of such individuals of any of the Acquired Companies (the "Benefit Plans") are listed on Schedule 3.9. With respect to such Benefit Plans, except as set forth in Schedule 3.9, (a) each Benefit Plan and any related trust intended to be qualified under Sections 401(a), 501(a) or 501(c) of the Code has been duly authorized by the appropriate board of directors or other governing body of the Company and each participating Subsidiary, is qualified in form and operation under Section 401(a) of the Code and each trust under such Benefit Plan is exempt from tax under Section 501(a) of the Code, has received a favorable determination letter from the IRS that it is so qualified and, to the Company's Knowledge, nothing has occurred that will or could give rise to disqualification or loss of tax-exempt status of any such Benefit Plan or trust under such sections, no event has occurred that will or could subject any such Benefit Plans to tax under Section 511 of the Code, and no non-exempt prohibited transaction (within the meaning of Section 4975 of the Code) or non-exempt party-in-interest transaction (within the meaning of Section 406 of the Employee Retirement and Income Security Act of 1974, as amended ("ERISA") has occurred with respect to any of such Benefit Plans, (b) each Benefit Plan has been operated in all material respects in accordance with the terms and requirements of applicable law including requirements under ERISA and the Code (including COBRA requirements under Section 4980B of the Code), (c) none of the Acquired Companies has incurred any direct or indirect liability under, arising out of or by operation of Title I or Title IV of ERISA in connection with any Benefit Plan or other retirement plan or arrangement, and no fact or event exists that would reasonably be expected to give rise to any such liability, (d) all contributions due and payable on or before the date of this Agreement in respect of each Benefit Plan have been made in full or properly accrued and as of the Closing, neither the Acquired Companies nor the Buyer shall have or assume any material liability that is unfunded or unaccrued related to any Benefit Plan, (e) none of the Acquired Companies, and no trade or business (whether or not incorporated) that is a member of a group of which the Company or any Subsidiary is a member and which is under common control within the meaning of Section 414(b) and (c) of the Code, has ever

sponsored or been obligated to contribute to any "multiemployer plan" (as defined in Section 3(37) of ERISA), "multiple employer plan" (as defined in Section 413 of the Code) or "defined benefit plan" (as defined in Section 3(35) of ERISA) and/or Section 412 of the Code, (f) except as set forth on Schedule 3.9 and, except as otherwise required by Section 4980B of the Code and applicable state insurance laws, no Benefit Plan currently or previously maintained by the Acquired Companies provides any post-retirement health or life insurance benefits, and none of the Acquired Companies maintains any obligations to provide post-retirement health or life insurance benefits in the future, (g) all reporting and disclosure obligations imposed under ERISA and the Code have been satisfied with respect to each Benefit Plan in all material respects, (h) each Benefit Plan maintained for the benefit of any current or former employee, partner, agent, officer or director of any of the Acquired Companies is listed on Schedule 3.9 and true and complete copies of the current plan documents, summary plan descriptions, most recent determination letters from the IRS and Forms 5500 (where applicable) for each such Benefit Plan have been provided to the Buyer, (i) there are no negotiations, demands or proposals that are pending or have been made which concern matters now covered by the Benefit Plans, or that would be covered by plans, agreements or arrangements of the type described in this section and there are not pending or, to the Company's Knowledge, threatened litigation or claims (other than routine claims for benefits) against the Benefit Plans or their assets or arising out of the Benefit Plans, and (j) no benefit or amount payable or which may become payable by the Acquired Companies pursuant to any Benefit Plan, agreement or contract with any employee, shall constitute an "excess parachute payment," within the meaning of Section 280G of the Code, which is or may be subject to the imposition of any excise tax under Section 4999 of the Code or which would not reasonably be expected to be deductible by reason of Section 280G of the Code. None of the Affiliated Property Owners has any employees and, thus, has no employee benefit plans, programs and arrangements maintained for the benefit of any employees.

Section 3.10 Properties

(a): Properties. Schedule 3.10(a) sets forth a list by commonly known name and address of all real properties in which the Acquired Companies have a direct or indirect interest (collectively, the "Properties" and each, a "Property"), which Schedule indicates the Acquired Company or Affiliated Property Owner that directly owns each Property and the direct or indirect interest of the Acquired Companies in such Property and/or entity, and the type of interest (e.g., fee, leasehold, option, etc.). The Properties listed on Schedule 3.10(a) are all of the real properties in which the Acquired Companies own a direct or indirect real property interest.
(b): Leases. The Company has made available true and complete copies of all leases, licenses, concession agreements or other occupancy agreements with respect to the Properties as of the date of this Agreement (the "Leases") and guarantees of the obligations of the tenant under the Lease, if any, as of the date of this Agreement, (which Leases and amendments thereto are listed on Schedule 3.10(b)), and, except as listed on Schedule 3.10(b) and except for the Excluded Occupancy Agreements (as hereinafter defined), there are no other Leases in effect with respect to the Properties. The term "Leases" excludes, however, all cart, kiosk and seasonal leases with a term of six (6) months or less (the "Excluded Occupancy Agreements"). Except as disclosed on Schedule 3.10(b): (i) with respect to the applicable Acquired Company or Affiliated Property Owner, each Lease is in full force and effect, and, with respect to tenants under the Leases, to the Company's Knowledge, each Lease is in full force and effect; (ii) the Company has received no written notice or a copy of a notice from any tenant claiming that the applicable Acquired Company or Affiliated Property Owner is currently in default under its obligations as landlord under any Lease; (iii) no tenant is in default in any rent or other material monetary obligation for any period in excess of three months or, to the Company's Knowledge, any material non-monetary obligation, under its Lease; and (iv) no rent has been paid by any tenant more than one month in advance and no tenant deposits have been applied to perform tenant obligations.
(c): Rights to Purchase or Lease. Except as set forth on Schedule 3.10(c), no Acquired Company or Affiliated Property Owner has granted any unexpired option agreements or rights of first refusal with respect to the purchase of a Property or the lease of more than twenty-five percent (25%) of such Property or any other unexpired rights (including pursuant to purchase and sale or other similar agreements and rights of first refusal, first offer or similar rights) in favor of third persons to purchase or otherwise acquire a Property or any interest in a Property or any interest in any Acquired Company or any interest of an Acquired Company in an Affiliated Property Owner, other than such rights in Leases of out-parcels that (i) are less than two acres or improved with less than 10,000 square feet, and (ii) have a fair market value of less than $100,000.

(d): Reciprocal Easement Agreements. The Company has made available true and complete copies of all reciprocal easement agreements affecting the Properties. Except as disclosed on Schedule 3.10(d), (i) the Company has received no written notice or a copy of a notice from any other party to any such reciprocal easement agreement or similar agreement claiming that the Company is currently in default under its obligations thereunder, (ii) to the Company's Knowledge, no third party to any such reciprocal easement agreement or similar agreement is in default of any of its material obligations thereunder, (iii) with respect to the applicable Acquired Company or Affiliated Property Owner, each such reciprocal easement agreement or similar agreement is in full force and effect and (iv) with respect to the other parties to any such agreement, to the Company's Knowledge, such reciprocal easement agreement or similar agreement is in full force and effect.
(e): Condemnation. There is no currently pending condemnation proceeding with respect to any Property and, to the Company's Knowledge, the Company has not received any written notice or copy of notice from any Governmental Authority to the effect that any condemnation proceeding is contemplated in connection with any Property.
(f): Title Reports. The Company has made available in the Review Room the most recent title reports commissioned by the Company with respect to each of the Properties and, to the Company's Knowledge, such title reports are accurate and complete in all material respects and do not fail to list any material exception to title.

Section 3.11 Labor and Employment Matters. Except as set forth on Schedule 3.11:

(a): None of the Acquired Companies is a party to any collective bargaining agreement or other current labor agreement with any labor union or organization, and, to the Company's Knowledge, there is no question involving current union representation of employees of the Acquired Companies, nor do the Acquired Companies know of any activity or proceeding of any labor organization (or representative thereof) or employee group (or representative thereof) to organize any such employees.
(b): There is no unfair labor practice charge or grievance arising out of a collective bargaining agreement or other grievance procedure pending, or, to the Company's Knowledge, threatened in writing against the Acquired Companies.
(c): To the Company's Knowledge, except for routine litigation arising in the ordinary course of business of any of the Acquired Companies or the Affiliated Property Owners, or that is adequately covered by insurance (or as set forth on Schedule 3.7), there is no complaint, lawsuit or proceeding in any forum by or on behalf of any present or former employee of any of the Acquired Companies, any applicant for employment with any of the Acquired Companies or any classes of the foregoing, alleging breach of any express or implied contract of employment, any Law or regulation governing employment or the termination thereof or other discriminatory, wrongful or tortious conduct by any of the Acquired Companies in connection with the employment relationship pending or threatened in writing against the Acquired Companies.
(d): There is no strike, slowdown, work stoppage or lockout pending, or, to the Company's Knowledge, threatened against or involving the Acquired Companies.
(e): To the Company's Knowledge, the Acquired Companies Employees (as hereinafter defined) are lawfully authorized to work in the United States according to federal immigration Laws.
(f): Each of the Acquired Companies is in compliance in all material respects with all applicable Laws in respect of employment and employment practices, terms and conditions of

employment, wages, hours of work, worker's compensation, non-discrimination, immigration and occupational safety and health.

(g): As of the date of this Agreement, there is no proceeding, claim, suit, action or governmental investigation pending or, to the Company's Knowledge, threatened in writing, with respect to which any current or former partner, officer, employee or agent of any of the Acquired Companies is claiming indemnification from any of the Acquired Companies.

Section 3.12 Contracts and Commitments.

(a)

Schedule 3.12 lists each of the following contracts or agreements (if any) of each of the Acquired Companies and Affiliated Property Owners:

(i): material management contracts with respect to the Properties;
(ii): all material documents evidencing or creating indebtedness for borrowed money, or giving rise to a guarantee of such indebtedness, of the Acquired Companies or of an Affiliated Property Owner relating to a Property with a remaining principal balance in excess of $100,000;
(iii): partnership agreements, limited liability company agreements and joint venture agreements to which any Acquired Company is a party (and having as another party any Person who is not an Acquired Company);
(iv): leases relating to any material personal property leased by the Acquired Companies or any Affiliated Property Owner or other real property leased by the Acquired Companies or any Affiliated Property Owner;
(v): all of the employment agreements between any of the Acquired Companies and any of the Acquired Companies Employees in effect as of the date hereof (the "Employment Agreements"), any severance agreement or arrangement with any Acquired Companies Employee, and all agreements pursuant to which consulting services are rendered to any Acquired Company that are likely to involve payments in excess of $100,000 per year;
(vi): agreements granting to any unaffiliated third party a first-refusal, first-offer or other right to purchase or acquire any of the Interests;
(vii): agreements materially limiting or restricting the ability of any Acquired Company or any Affiliated Property Owner to enter into or engage in any geographic area or line of business other than as provided in any Leases or reciprocal easement agreements or similar agreements affecting the Properties; and
(viii): agreements that will not be terminated on or before the Closing, or that cannot be terminated within thirty (30) days of the Closing, between any Acquired Company and any Partner or any Partner's Affiliates (other than an Acquired Company or an Affiliated Property Owner) that commit any one or more of the Acquired Companies or Affiliated Property Owners to pay, in the aggregate, more than $40,000 per year.
(ix): agreements entered into since March 31, 2002 pursuant to which any Acquired Company incurred an obligation to pay any amounts in respect of indemnification obligations, purchase price adjustment or otherwise in connection with (A) any acquisition or disposition of assets, (B) merger, consolidation or other business combination, or (C) series or group of related transactions or events of a type specified in (A) or (B).

(b): True and complete copies of the contracts and agreements disclosed pursuant to Section 3.12(a) hereof have been made available to the Buyer. Except as set forth on Schedule 3.12 (i) each contract and agreement disclosed pursuant to Section 3.12(a) hereof is

valid and binding in all material respects on the Acquired Company or Affiliated Property Owner party thereto and, to the Company's Knowledge, on the other party or other parties thereto, and is in full force and effect in accordance with its respective terms, (ii) upon consummation of the transactions contemplated by this Agreement and assuming that all consents, approvals, authorizations and other actions set forth on Schedule 3.6 have been obtained and all filings and notifications set forth on Schedule 3.6 have been made, each such contract and agreement shall continue in full force and effect in all material respects in accordance with its respective terms without penalty, acceleration of payment or other adverse consequence (including any diminution of management or other control rights with respect to the Acquired Companies or the Affiliated Property Owners, subject to "key person" provisions in agreements relating to Properties listed on Schedule 3.12), (iii) none of the Acquired Companies or Affiliated Property Owners, as applicable, is in material breach of, or material default under, any such contract or agreement, and no event exists that, but for the giving of notice or passage of time, would result in such a breach or default by the Acquired Company or Affiliated Property Owner party thereto, and (iv) to the Company's Knowledge, no other party to any such contract or agreement is in material breach thereof or material default thereunder, and no event exists that, but for the giving of notice or passage or time, would result in such a breach or default by the other party thereto.

Section 3.13 Intellectual Property. Except as set forth on Schedule 3.13, each Acquired Company and Affiliated Property Owner owns or has the right to use all trademarks, trade names, product names, domain names, service marks, logos, patents, patent applications, trade secrets, copyrights and other intellectual property rights (including domestic and foreign registrations and applications therefore) (collectively, the "Intellectual Property Rights"), as are used in connection with the business of such Acquired Company or Affiliated Property Owner, as applicable, except where the failure to own or have the right to use such Intellectual Property Rights would not reasonably be expected to have a Material Adverse Effect. Except as set forth on Schedule 3.13, to the Company's Knowledge, use of the Intellectual Property Rights by the Acquired Companies and Affiliated Property Owners (a) does not infringe any rights of any third party, and (b) none of the Acquired Companies or Affiliated Property Owners has received any written notice from any Person claiming that the rights of any Acquired Company or Affiliated Property Owner in or to the Intellectual Property Rights conflict with or infringe on the rights of any other Person.

Section 3.14 Environmental Matters. Except as set forth on Schedule 3.14 or disclosed in the Environmental Reports (as hereinafter defined), to the Company's Knowledge, (a) the Acquired Companies and the Affiliated Property Owners are in compliance in all material respects with all applicable Environmental Laws (as hereinafter defined), (b) there are no material Environmental Liabilities and Costs (as hereinafter defined) of the Acquired Companies, (c) there are no material Environmental Conditions (as hereinafter defined) on or related to the Properties, (d) the Company has not received any written notice during the two (2) year period prior to the date of this Agreement from any governmental agency or other third party alleging any material violation of, or noncompliance with, any Environmental Law, or requiring the removal, clean-up or remediation of any Environmental Condition, whether or not on any of the Properties, which such matter has not been resolved as of the date of this Agreement, and (e) the Company has not received written notice during the two (2) year period prior to the date of this Agreement that they are subject to any enforcement or investigatory action by any governmental agency regarding an Environmental Condition with respect to any Property, which such matter has not been resolved as of the date of this Agreement. As used herein, the terms "toxic" or "hazardous" wastes, substances or materials shall include, without limitation, all those so designated in and in any way regulated by any current Environmental Laws. The Acquired Companies have previously made available to the Buyer in the Review Room (as hereinafter defined) copies of the following written materials in their possession or control: copies of the most recent environmental

audits, site assessments and documentation regarding off-site disposal of hazardous materials (collectively, the "Environmental Reports").

For purposes of this Agreement, the following definitions shall apply:

"Environmental Laws" shall mean all applicable federal, state and local statutes or laws, judgments, orders, regulations, licenses, permits, rules and ordinances relating to pollution or protection of health, safety or the environment, including, but not limited to the Federal Water Pollution Control Act (33 U.S.C. §1251 et seq.), Resources Conservation and Recovery Act (42 ▇.▇.▇. §▇▇▇▇ et seq.), Safe Drinking Water Act (42 U.S.C. §3000(f) et seq.), Toxic Substances Control Act (15 ▇.▇.▇. §▇▇▇▇ et seq.), Clean Air Act (42 ▇.▇.▇. §▇▇▇▇ et seq.), Comprehensive Environmental Response, Compensation and Liability Act (42 ▇.▇.▇. §▇▇▇▇ et seq.), and other similar state and local statutes.

"Environmental Condition" shall mean the introduction into the environment of any contaminant, pollutant, hazardous or toxic waste, substance or material (whether or not upon the Properties) at levels or in amounts in excess of applicable legal or regulatory permits, limits or standards, as a result of which the Acquired Companies or Affiliated Property Owners, with respect to this Section 3.14, (1) has or may become liable to any Person or Governmental Authority, (2) is in violation of any Environmental Law, or (3) by reason of which any of the properties or other assets of any of the Acquired Companies or Affiliated Property Owners, with respect to this Section 3.14, may suffer or be subject to any lien.

"Environmental Liabilities and Costs" shall mean all liabilities, obligations, responsibilities, obligations to conduct cleanup, losses, damages, deficiencies, punitive damages, costs and expenses (including, without limitation, all reasonable fees, disbursements and expenses of counsel, expert and consulting fees and costs of any necessary investigations and feasibility studies and responding to government requests for information or documents), fines, penalties, monetary sanctions, known or unknown, absolute or contingent, past, present or future, resulting from any claim or demand, by any Person or Governmental Authority, whether based in contract, tort, implied or express warranty, strict liability, joint and several liability, criminal or civil statute, under any Environmental Law, or arising from Environmental Conditions, as a result of past or present ownership, leasing or operation of any properties, owned, leased or operated by the Acquired Companies or the Affiliated Property Owners with respect to Section 3.14.

Section 3.15 Compliance with Laws; Permits

(a): Except as set forth on Schedule 3.15, the Company has not received written notice and the Company otherwise has no knowledge that any of the Acquired Companies, Affiliated Property Owners or the Properties is in material violation of any applicable federal, state, local or foreign judgment, order, decree, or any material statute, law, ordinance, rule, regulation, code and any judicial or administrative interpretation thereof, or any other government or rule of law ("Law") or order of any Governmental Authority applicable to any of the Acquired Companies, the Affiliated Property Owners or the Properties. To the Company's Knowledge, the Acquired Companies and the Affiliated Property Owners have obtained all material licenses, permits and other authorizations and have taken all actions required by applicable Law in order to conduct their business as now or as previously conducted and, to the Company's Knowledge, there is no pending threat of modification or cancellation of the same.
(b): To the Company's Knowledge, all material agreements, easements or other rights necessary to permit the lawful use and operation of the buildings and improvements on any Property (other than parcels ground leased to third parties, as to which the Company makes no representation or warranty pursuant to this Section 3.15(b)) or to permit the lawful use and operation of all driveways, roads and other means of egress and ingress to and from any

Property have been obtained and are in full force and effect. Except as set forth on Schedule 3.15, all material work to be completed, payments to be made and financial undertakings required to be taken by any of the Acquired Companies or Affiliated Property Owners prior to the date hereof and the Closing pursuant to any contract entered into with a Governmental Authority in connection with a site approval, zoning reclassification or other similar action relating to a Property (other than parcels ground leased to third parties, as to which the Company makes no representation or warranty pursuant to this Section 3.15(b)) have been paid or undertaken.

(c): To the Company's Knowledge, none of the Acquired Companies or Affiliated Property Owners, nor any of their respective directors, officers, agents or employees has used any corporate or other funds for unlawful contributions, payments, gifts or entertainment or made any unlawful expenditures relating to any political activity to government officials or others. To the Company's Knowledge, none of the Acquired Companies or Affiliated Property Owners nor any of their respective directors, officers, agents or employees have accepted or received any unlawful contributions, payments, gifts or expenditures. No Acquired Company or Affiliated Property Owner has been charged with or committed, or to the Company's Knowledge, been under investigation with respect to, any violation of the Foreign Corrupt Practices Act.

Section 3.16 Insurance. Schedule 3.16 sets forth a true and correct summary of the insurance policies held by, or for the benefit of, the Acquired Companies and the Affiliated Property Owners including the underwriter of such policies and the amount of coverage thereunder. The Acquired Companies or the Affiliated Property Owners have paid, or caused to be paid, all premiums due under such policies and are not in default with respect to any monetary obligations under such policies in any material respect. To the Company's Knowledge, each of the Acquired Companies and the Affiliated Property Owners maintains insurance with financially responsible insurers in such amounts and covering such risks as are in accordance with normal industry practice for companies engaged in businesses similar to those of the Acquired Companies (taking into account the cost and availability of such insurance), except where the failure to maintain such insurance would not reasonably be expected to have a Material Adverse Effect. Except as set forth on Schedule 3.16, the Company has not received any written notice of cancellation or termination with respect to any existing material insurance policy that is held by, or for the benefit of, any of the Acquired Companies or the Affiliated Property Owners or that relates to any Property.

Section 3.17 Brokers. No broker, investment banker, financial advisor or other Person, other than Eastdil Realty Company, L.L.C., the fees and expenses of which will be paid by the Company at or prior to Closing, is entitled to any broker's, finder's, financial advisor's or other similar fee or commission in connection with the transactions contemplated by this Agreement based on any contacts made by the Company or any Affiliate or agent of the Company.

Section 3.18 Disclaimer; Company's Knowledge; Disclosure; Material Adverse Effect.

(a): The Company does not make, and has not made, any representations or warranties relating to the Acquired Companies, the Affiliated Property Owners, the Properties, or the operations or businesses of the Acquired Companies, the Affiliated Property Owners or the businesses or operations conducted on, at or with respect to the Properties, or otherwise in connection with the transactions contemplated hereby, other than those expressly made by the Company in this Agreement or in the other agreements and instruments delivered pursuant hereto in order to consummate the Merger. Other than as expressly set forth in this Agreement, the Company hereby specifically disclaims any warranty, guaranty or representation, oral or written, past, present or future, of, as to, or concerning (i) the nature and condition of any Property, including, without limitation, the water, soil and geology or any other matter affecting the

stability or integrity of such Property, and the suitability thereof and of any Property for any and all activities and uses that the Buyer may elect to conduct thereon, and the existence of any hazardous materials thereon, (ii) the compliance of any Property with any law, rule, regulation or ordinance to which the Property or the owner thereof is or may be subject, (iii) the condition of title to the Property or the nature and extent of any right of way, lease, license, reservation or contract, (iv) the profitability or losses or expenses relating to any Property and the businesses conducted in connection therewith, (v) the value of any Property, (vi) the existence, quality, nature or adequacy of any utility servicing any Property, (vii) the physical condition of any Property, (viii) whether any Lease will be in force or effect as to any tenant on the Closing Date or that any tenant thereunder will have performed all of its obligations thereunder through the Closing Date, and (ix) the legal or tax consequences of this Agreement or the transactions contemplated hereby. Without limiting the generality of the foregoing, except only as expressly set forth in those representations and warranties made in Sections 3.1 through 3.17 hereof, the Company has not made, and shall not be deemed to have made, any representations or warranties in any presentation of the businesses of the Acquired Companies or the Affiliated Property Owners (including without limitation any management presentation or property or facility tour) in connection with the transactions contemplated hereby, and no statement made in any such presentation (including without limitation any management presentation or property or facility tour) shall be deemed a representation or warranty hereunder or otherwise. It is understood that any cost estimates, projections or other predictions, any data, any financial information, document, reports, sales brochure or other literature, maps or sketches, financial information or statements, or presentations (including without limitation any management presentation or property or facility tour), or any memoranda or offering materials including, without limitation, those certain Confidential Offering Memorandum dated March 2002 or April 2002 and any materials or information contained therein and any amendments or supplements thereto (the "Confidential Memorandum"), are not and shall not be deemed to be or to include representations or warranties of the Acquired Companies, except only as expressly set forth in those representations and warranties made in Sections 3.1 through 3.17 hereof, and the Buyer acknowledges that it has not relied and is not relying on any such estimates, projections, predictions, data, financial information, memoranda, offering materials or presentations (including without limitation any management presentation or property or facility tour), including without limitation, the Confidential Memorandum. No Person has been authorized by the Acquired Companies to make any representation or warranty relating to the Acquired Companies, the Affiliated Property Owners, the Properties, the businesses of the Acquired Companies or the Affiliated Property Owners, or the businesses or operations conducted on, at or with respect to the Properties, or otherwise in connection with the transactions contemplated hereby and, if made, such representation or warranty must not be relied upon as having been authorized by the Acquired Companies.

(b): Prior to the Closing Date, the Buyer will have had the opportunity to make all inspections and investigations, including a review of the materials located on the Company's Internet web site (the "Review Room") and the physical inspection contemplated in Section 2.10, concerning the Acquired Companies, the Affiliated Property Owners and the Properties which the Buyer deems necessary or desirable to protect its interest in acquiring the Acquired Companies and their respective assets.
(c): Whenever a representation or warranty made by the Company herein refers to the knowledge of the Company, or to the "Company's Knowledge," the accuracy of such representation shall be based solely on the actual knowledge of ▇▇▇▇▇▇ ▇. ▇▇▇▇, the President and Chief Executive Officer of the Company, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the Chief Financial Officer of the Company, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Executive Vice President of the Company, ▇▇▇▇ ▇. ▇▇▇▇▇, Executive Vice

President of the Company, and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Executive Vice President of the Company (each a "Company Knowledge Party"), and shall not be construed to refer to the knowledge of any other officer, agent, partner, member, manager or employee of the Company or of any Affiliate of the Company or to impose or have imposed upon any Company Knowledge Party any duty to investigate the matters to which such knowledge, or the absence thereof, pertains including, without limitation, the contents of any files, documents or materials made available to or otherwise disclosed to the Buyer or the contents of files maintained by any Company Knowledge Party. Whenever a representation provides that the Company has not received notice of a fact or event or words of similar import, the accuracy of such representation shall be based solely on the actual receipt by a Company Knowledge Party of such notice or on the receipt of such notice by another employee of the Company or an Affiliate of the Company where a Company Knowledge Party has actual knowledge that such notice has been received by such other employee of the Company or an Affiliate of the Company

(d): Notwithstanding anything to the contrary contained in this Agreement or in any of the schedules prepared by the Company and attached hereto (the "Company Disclosure Schedules"), any information disclosed on one Schedule shall be deemed to be disclosed on another Schedule provided that specific cross-references are made to such other Schedule. Certain information set forth on the Schedules is included solely for informational purposes and may not be required to be disclosed pursuant to this Agreement. The disclosure of any information shall not be deemed to constitute an acknowledgment that such information is required to be disclosed in connection with the representations and warranties made by the Company in this Agreement or that it is material, nor shall such information be deemed to establish a standard of materiality, nor shall it be deemed an admission of any liability of, or concession as to any defense available to, the Company. The Company has prepared the Company Disclosure Schedules in good faith and without regard to any applicable "Material Adverse Effect" or other "materiality" qualifier; provided, however, that notwithstanding such standard of preparation, nothing contained herein shall limit or otherwise qualify the standard of the representations and warranties contained in Sections 3.1 through 3.17 hereof for the purposes of determining the existence of a breach of any such representation or warranty.
(e): "Material Adverse Effect" shall mean any change or effect that is (individually or in the aggregate with any other changes therein or effects thereon that would be specifically addressed by a representation or warranty contained in this Agreement but for a "Material Adverse Effect" exception or qualification) materially adverse to the business, operations, assets, liabilities, financial condition or results of operations of the Acquired Companies, taken as a whole (provided that any such change, effect, event, occurrence or state of facts that is cured prior to the Closing at the expense of such affected party shall not be considered a Material Adverse Effect), other than any such changes or effects resulting primarily from any of the following: (i) general changes in the economy or financial markets of the United States or any other region outside of the United States (other than those that would have a materially disproportionate effect, relative to other industry participants, on the Acquired Companies and the Affiliated Property Owner taken as a whole), (ii) changes in general (national, regional or local) economic, regulatory or political conditions or changes in the retail industry or retail real estate properties generally (other than those that would have a materially disproportionate effect, relative to other industry participants, on the Acquired Companies and the Affiliated Property Owners taken as a whole), (iii) changes in Law or GAAP, or (iv) this Agreement, the transactions contemplated hereby, or any announcement or indication thereof, or any actions taken by the Buyer hereunder or in contemplation hereof, or any actions that the Company was required to take, hereunder, or any direct contact of the Buyer or any of its representatives with any of the tenants, joint venture partners, customers or suppliers, or potential tenants, joint venture partners, customers or suppliers, of the

Acquired Companies, or any of the Acquired Companies Employees (including any departure of any such employee).

ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE BUYER AND ACQUISITION SUB

As a material inducement to the Company to enter into this Agreement and to consummate the transactions contemplated hereby, the Buyer and Acquisition Sub represent and warrant to the Company as follows:

Section 4.1 Organization of the Buyer and Acquisition Sub. The Buyer is a duly organized, validly existing limited partnership and in good standing under the laws of the State of Delaware and has all the requisite corporate power and authority to enter into this Agreement, to carry out its obligations hereunder and to consummate the transactions contemplated hereby. Acquisition Sub is a duly organized, validly existing limited partnership and in good standing under the laws of the State of Delaware and has all the requisite partnership power and authority to enter into this Agreement, to carry out its obligations hereunder and to consummate the transactions contemplated hereby. Each of the Buyer and Acquisition Sub is qualified to do business in each jurisdiction in which the nature of its business requires it to be so qualified except to the extent the failure to so qualify would not, either individually or in the aggregate, have a material adverse effect on the ability of the Buyer or Acquisition Sub to perform its obligations under this Agreement.

Section 4.2 Authority. Each of the Buyer and Acquisition Sub has full authority, right, power and capacity to enter into this Agreement and each agreement, document and instrument to be executed and delivered by or on behalf of the Buyer or Acquisition Sub, as applicable, pursuant to or as contemplated by this Agreement and to carry out the transactions contemplated hereby and thereby. The execution, delivery and performance by the Buyer and Acquisition Sub of this Agreement and each such other agreement, document and instrument have been duly authorized by all necessary action of the Buyer or Acquisition Sub, as applicable, and no other action on the part of the Buyer and Acquisition Sub is required in connection therewith. This Agreement and each agreement, document and instrument to be executed and delivered by the Buyer and Acquisition Sub pursuant to or as contemplated by this Agreement (including, without limitation, the Deposit Escrow Agreement and the Indemnification Escrow Agreement) constitute, or when executed and delivered will constitute, valid and binding obligations of the Buyer or Acquisition Sub, as applicable, enforceable in accordance with their respective terms, except as the same may be limited by bankruptcy, insolvency, reorganization, moratorium or other laws affecting the rights of creditors generally and subject to the rules of law governing (and all limitations on) specific performance, injunctive relief and other equitable remedies. Except as provided in Schedule 4.2, and except as may result from any facts or circumstances relating solely to the Company, and assuming that all consents, approvals, authorizations and other actions set forth in Section 4.3 have been obtained and all filings and notifications set forth on Schedule 4.3 have been made, the execution, delivery and performance by the Buyer and Acquisition Sub of this Agreement and each such agreement, document and instrument:

(a): do not and will not violate the terms of any organizational documents of the Buyer or Acquisition Sub, as applicable;
(b): do not and will not violate any laws of the United States, or any state or other jurisdiction applicable to the Buyer or Acquisition Sub or require the Buyer or Acquisition Sub to obtain any approval, consent or waiver of, or make any filing with, any Person (governmental or otherwise) that has not been obtained or made, except for such violations as would not reasonably be expected to have a material adverse effect on the ability of Buyer or Acquisition Sub to perform its obligations under this Agreement; and

(c): do not and will not result in a material breach of, constitute a material default under, accelerate any material obligation under or give rise to a material right of termination of any indenture or loan or credit agreement or any other agreement, contract, instrument, mortgage, lien, lease, permit, authorization, order, writ, judgment, injunction, decree, determination or arbitration award to which the Buyer or Acquisition Sub is a party or by which the property of the Buyer or Acquisition Sub is bound or affected, or result in the creation or imposition of any material mortgage, pledge, lien, security interest or other charge or encumbrance on any of the assets or properties of the Buyer or Acquisition Sub.

Section 4.3 Consents and Approvals.

(a): To the Buyer's Knowledge, except as set forth on Schedule 4.3, the execution, delivery and performance of this Agreement by the Buyer and Acquisition Sub will not, as of the Closing Date, require any consent, approval, authorization or other action by, or filing with or notification to, any Governmental Authority, except (i) the notification requirements of the HSR Act, if applicable, (ii) where the failure to obtain such consent, approval, authorization or action, or to make such filing or notification, would not (A) delay or prevent the consummation of the transactions contemplated by this Agreement or (B) have a material adverse effect on the ability of the Buyer and Acquisition Sub to perform its obligations under this Agreement, and (iii) as may be necessary as a result of any facts or circumstances relating solely to the Company.
(b): To the Buyer's Knowledge, except as set forth on Schedule 4.3, the execution, delivery and performance of this Agreement by the Buyer and Acquisition Sub will not, as of the Closing Date, require any third-party consents, approvals, authorizations or actions, except (i) where the failure to obtain such consents, approvals, authorizations or actions would not (A) delay or prevent the consummation of the transactions contemplated by this Agreement or (B) have a material adverse effect on the ability of the Buyer or Acquisition Sub to perform its obligations under this Agreement and (ii) as may be necessary as a result of any facts or circumstances relating solely to the Company.

Section 4.4 Litigation. Except as set forth on Schedule 4.4 and except for routine litigation arising in the ordinary course of the Buyer's or Acquisition Sub's business, or to the Buyer's Knowledge that is adequately covered by insurance, there is no action, suit or proceeding, claim, arbitration or investigation pending against the Buyer or Acquisition Sub or, to the Buyer's Knowledge, threatened, which, if adversely determined, (a) would delay or prevent the consummation of the transactions contemplated by this Agreement, or (b) would be reasonably expected to have a material adverse effect on the ability of the Buyer or Acquisition Sub to perform its obligations under this Agreement.

Section 4.5 Financing. The Buyer will have available to it at the Closing, all funds necessary to consummate the transactions contemplated by this Agreement. The Buyer has heretofore furnished the Company with sufficient evidence, including true and complete copies of balance sheets of the Buyer and/or a financing commitment from the Buyer's third party financing sources as are attached hereto as Schedule 4.5, of its financial ability to consummate the transactions contemplated by this Agreement. The Buyer acknowledges and agrees that the Buyer's performance of its obligations under this Agreement is not in any way contingent upon the availability of financing to the Buyer, including the closing of the financing under any financing commitment obtained by the Buyer.

Section 4.6 Brokers. No broker, investment banker, financial advisor or other Person, other than Deutsche Bank Securities Inc., the fees and expenses of which will be paid by the Buyer, is entitled to any broker's, finder's, financial advisor's or other similar fee or commission in connection with the transactions contemplated by this Agreement based on any contacts made by the Buyer or any Affiliate or agent of the Buyer.

Section 4.7 ERISA Compliance

(a): Neither the Buyer nor Acquisition Sub, nor any of the "affiliates" of either (within the meaning of Part V(c) of Prohibited Transaction Class Exemption ("PTCE") 84-14, granted pursuant to Section 408(a) of ERISA) has, or during the immediately preceding year has exercised, the authority to appoint or terminate AEW Capital Management, L.P. ("AEW") as manager of any of the assets of any of the "Applicable Plans" identified below, or to negotiate the terms of any management agreement with AEW (including renewals or modifications thereof) on behalf of any such Applicable Plan. Neither the Buyer nor Acquisition Sub is "related" to AEW within the meaning of Parts I(d) and V(h) of ▇▇▇▇ ▇▇-▇▇. For purposes of this Section 4.7, the "Applicable Plans" are the plans that participate in either the Telephone Real Estate Equity Trust or the Harbor Capital Group Trust for Defined Benefit Plans.

Section 4.8 Buyer's Knowledge; Disclosure.

(a): Whenever a representation or warranty made by the Buyer herein refers to the knowledge of the Buyer, or to the "Buyer's Knowledge," the accuracy of such representation shall be based solely on the actual knowledge of the following officers of The Macerich Company, the general partner of the Buyer: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President and Chief Executive Officer, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Executive Vice President, ▇▇▇▇▇▇ ▇. ▇'▇▇▇▇, Chief Financial Officer, Treasurer and Executive Vice President, and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, General Counsel, Secretary and Executive Vice President (each a "Buyer Knowledge Party") and shall not be construed to refer to the knowledge of any other officer, agent, partner or employee of the Buyer or of any Affiliate of the Buyer or to impose or have imposed upon any Buyer Knowledge Party any duty to investigate the matters to which such knowledge, or the absence thereof, pertains including, without limitation, the contents of any files, documents or materials made available to or otherwise disclosed to the Company or the contents of files maintained by any Buyer Knowledge Party. Whenever a representation provides that the Buyer has not received notice of a fact or event or words of similar import, the accuracy of such representation shall be based solely on the actual receipt by a Buyer Knowledge Party of such notice or on the receipt of such notice by another employee of the Buyer or an Affiliate of the Buyer where a Buyer Knowledge Party has actual knowledge that such notice has been received by such other employee of the Buyer or an Affiliate of the Buyer.
(b): Notwithstanding anything to the contrary contained in this Agreement or in any of the schedules prepared by the Buyer and attached hereto (the "Buyer Disclosure Schedules"), any information disclosed on one Schedule shall be deemed to be disclosed on another Schedule provided that specific cross-references are made to such other Schedule. Certain information set forth in the Schedules is included solely for informational purposes and may not be required to be disclosed pursuant to this Agreement. The disclosure of any information shall not be deemed to constitute an acknowledgment that such information is required to be disclosed in connection with the representations and warranties made by the Buyer in this Agreement or that it is material, nor shall such information be deemed to establish a standard of materiality, nor shall it be deemed an admission of any liability of, or concession as to any defense available to, the Buyer. The Buyer has prepared the Buyer Disclosure Schedules in good faith and without regard to any applicable "materiality" qualifier; provided, however, that notwithstanding such standard of preparation, nothing contained herein shall limit or otherwise qualify the standard of the representations and warranties contained in Sections 4.1 through 4.7 hereof for the purposes of determining the existence of a breach of any such representation or warranty.

ARTICLE V
CERTAIN COVENANTS AND AGREEMENTS OF THE BUYER, ACQUISITION SUB AND THE COMPANY

Section 5.1 Conduct of Business Prior to Closing.

(a)

The Company covenants and agrees that, between the date hereof and the Closing Date, it shall use commercially reasonable efforts to cause the Acquired Companies and the Affiliated Property Owners to operate in the ordinary course of business, consistent with past practice and substantially consistent with the Company's annual budget and business plan for 2002 (the "Budget"), which are attached as Schedule 5.1(a) hereto, except as otherwise provided in this Agreement.

(b)

In furtherance and not in limitation of the foregoing, the Company covenants and agrees that, except as described in Schedule 5.1(b), the Acquired Companies will not, and the Company will use commercially reasonable efforts to cause the Affiliated Property Owners to not, prior to the Closing, without the consent of the Buyer, which consent shall not be unreasonably withheld, take any of the following actions:

(i): Make any purchase, sale or disposition (or trigger any contractual rights with respect to the purchase, sale or disposition) of any property or interest therein (other than easements and similar grants in the ordinary course of business), with a purchase price in excess of $200,000 individually or $2,000,000 in the aggregate, except as provided in the Budget and provided that all proceeds remain in one of the Acquired Companies or Affiliated Property Owners, as the case may be, and are not distributed pursuant to Section 2.8, (other than the proceeds of transactions described in Schedule 5.1(b), which will be distributed pursuant to Section 2.8) or mortgage, pledge, subject to a voluntary lien or otherwise voluntarily encumber (except for statutory mechanics', carriers', suppliers' workmen's or repairmen's liens) any of the Properties or other material assets, except for any such Encumbrance which, by its terms, will be terminated or otherwise be extinguished at or prior to the Closing;
(ii): Incur any material contingent liability as a guarantor or otherwise with respect to the obligations of others, or incur any other material contingent or fixed obligations or liabilities, other than in the ordinary course of business and draws on existing commitment facilities;
(iii): Make any change or incur any obligation to make a change to the Company's certificate of limited partnership, the Limited Partnership Agreement or in the rights and obligations of any outstanding Interests or to the partnership agreement, operating agreement or other organizational documents governing any other Acquired Company or any Affiliated Property Owner;
(iv): Make any change in the compensation payable or to become payable to any of the Acquired Companies Employees, agents or independent contractors who receive total annual compensation of $100,000 or more, other than as contemplated in the Budget or otherwise in the ordinary course of business consistent with past practice or in accordance with the existing terms of contracts entered into prior to the date of this Agreement;
(v): Amend, modify or terminate any contract or agreement disclosed pursuant to Section 3.12(a) hereof except in the ordinary course of business consistent with past practice or as otherwise contemplated by this Agreement;
(vi): Change in any material respect, any accounting principles, policies or practices used by it relating to the Acquired Companies, except for (A) the write-off (if any) of goodwill, and

(B) any change required by reason of a concurrent change in GAAP and notice of which is given in writing by the Company to the Buyer;

(vii): Merge or consolidate with or agree to merge or consolidate with, nor purchase or agree to purchase all or substantially all of the assets of, or otherwise acquire, any other party, or cause a dissolution or terminate the existence of any Acquired Company or Affiliated Property Owner;
(viii): Authorize for issuance, issue, sell or deliver any additional equity of any Acquired Company or any Affiliated Property Owner or any securities or obligations convertible into equity of any Acquired Company or any Affiliated Property Owner or issue or grant any option, warrant or other right to purchase any equity of any Acquired Company or any interest of an Acquired Company in any Affiliated Property Owner, or make any capital call (other than the capital call referenced in Section 3.3 hereof) with respect to any Affiliated Property Owner, unless obligated to do so;
(ix): Assign, transfer, convey or grant an Encumbrance on any equity held by any of the Acquired Companies in any other Acquired Company or any Affiliated Property Owner;
(x): Modify, amend or alter any existing credit facilities in a manner materially adverse to the Company, or increase the amount that can be borrowed under any construction loan, the obligations with respect to which will remain with any Acquired Company or Affiliated Property Owner after the Closing Date;
(xi): Cause a material default by an Acquired Company or Affiliated Property Owner under any existing material agreement or contract of such Acquired Company or Affiliated Property Owner;
(xii): Execute or otherwise enter into any construction or development agreement requiring a payment in excess of $200,000 except as otherwise provided in the Budget;
(xiii): Take any affirmative action, or affirmatively fail to take any action, necessary to maintain in all material respects all material permits, licenses and authorizations required by applicable Law for the operation of the Acquired Companies, the Affiliated Property Owners and the Properties as currently operated;
(xiv): Enter into or modify in any material respect any Lease demising more than 10,000 square feet or any reciprocal easement agreement or similar agreement affecting a Property;
(xv): Agree to any imposition of any Encumbrance on any of the Interests;
(xvi): Take any action that would cause any present employees of any of the Acquired Companies to become unavailable (other than in the ordinary course of business) or that would materially and adversely affect the goodwill of any suppliers or customers of the Acquired Companies or Affiliated Property Owners;
(xvii): Make any new elections with respect to Taxes or change any current elections with respect to Taxes that affect any of the Acquired Companies or Affiliated Property Owners;
(xviii): Settle any litigation or claim involving an uninsured liability in excess of $250,000 (other than the Specified Litigation);
(xix): Enter into any agreement or understanding that would prohibit, restrict or interfere with the transactions contemplated in this Agreement;
(xx): Fail to maintain in full force and effect all insurance coverage listed on Schedule 3.16, except where such failure is caused by default or failure of the insurers;

(xxi): Use the proceeds of any construction loan for any purpose other than the construction of the applicable Property under development, or for tenant allowances for such Property, as provided in the Budget; and
(xxii): Agree or make any commitment to take any of the actions prohibited by this Section 5.1.

Section 5.2 Access to Information.

(a): From the date hereof until the Closing Date, upon reasonable advance notice, the Company shall, and shall cause each Subsidiary and each of their respective Representatives (as hereinafter defined) to, (i) afford the Representatives of the Buyer and Acquisition Sub reasonable access, during normal business hours, to the books and records of the Acquired Companies and to those Representatives of the Acquired Companies who have material, relevant knowledge pertaining to the Properties or the Acquired Companies or the Affiliated Property Owners including, without limitation, access to enter upon and perform the physical and environmental inspections on the Properties contemplated by Section 2.10 hereof, (ii) provide any addition financial statements that may be required by the Buyer or its Affiliates to comply with the reporting requirements of the SEC under Regulations S-K and S-X, and cause its independent public accountants to cooperate in providing an opinion with respect to the Financial Statements and any additional audited financial statements the Buyer may require for such purposes, and (iii) furnish to the Representatives of the Buyer and Acquisition Sub such additional financial and operating data (which data shall include, subject to clause (D) of the proviso below, monthly financial statements prepared in accordance with GAAP on the same basis as the Financial Statements and such other financial and operating data as is provided to the Company's management on a monthly basis) and such other information regarding the Acquired Companies as the Buyer or Acquisition Sub may from time to time reasonably request; provided, however, that (A) such investigation shall not unreasonably interfere with any of the businesses or operations of the Acquired Companies or the Affiliated Property Owners, (B) the Buyer and Acquisition Sub shall not, prior to the Closing Date, have any contact whatsoever with respect to the Acquired Companies or the Affiliated Property Owners or with respect to the transactions contemplated by this Agreement with any partner, lender, ground lessor, tenant (included ground lessees), vendor or supplier of the Acquired Companies, except in consultation with the Company and then only with the express prior approval of the Company, which shall not be unreasonably withheld, (C) all requests by the Buyer and Acquisition Sub for access or information pursuant to this Section 5.2(a) shall be submitted or directed exclusively to an individual or individuals to be designated by the Company, and (D) the Company shall not be required to deliver periodic financial information other than consistent with past practice, which, in the case of any Property, consists of monthly financial statements and, in the case of any Affiliated Property Owner, consists of quarterly financial statements. The Buyer and Acquisition Sub shall not be permitted to conduct any invasive tests on any Property without the Company's prior written consent, which shall not be unreasonably withheld. Each of the Buyer and Acquisition Sub agrees to indemnify the Acquired Companies and the Affiliated Property Owners from and against any and all Losses suffered by the Acquired Companies and the Affiliated Property Owners as a result of any physical or environmental damage or injury to persons caused by the Buyer and Acquisition Sub during the conduct of the investigations and inspections contemplated hereby (it being understood that such indemnity shall not apply to discovery by the Buyer or Acquisition Sub of any existing matters if the discovery thereof imposes liability the Company or any other indemnified party).
(b): In order to facilitate the resolution of any claims made by or against or incurred by the Partners after the Closing in respect of their ownership of the Acquired Companies or for any

other reasonable purpose, for a period of seven (7) years following the Closing, the Buyer and Acquisition Sub shall, and shall cause the Acquired Companies and the Affiliated Property Owners to, (i) retain the books and records of the Buyer, Acquisition Sub, the Acquired Companies or the Affiliated Property Owners, as the case may be, and their operations for periods prior to the Closing and which shall not otherwise have been retained by the Partners and (ii) upon reasonable notice, afford the Representatives of any Partner reasonable access (including the right to make photocopies, at the expense of such Partner), during normal business hours, following reasonable notice thereof, to such books and records.

Section 5.3 Confidentiality. Subject to the requirements of applicable Law and the requirements of any securities exchange on which a party's securities may be listed, and except as may be disclosed in a press release consented to in writing by both parties in accordance with Section 5.6, until the Closing, the parties hereto will, and will instruct each of their respective Affiliates, associates, partners, employees, directors, officers, agents, counsel, auditors, investment bankers, representatives and advisors (the "Representatives") to, (a) hold in strict confidence all such information as is confidential or proprietary, (b) use such information only in connection with the consummation of the transactions contemplated by this Agreement and, (c) if this Agreement is terminated in accordance with its terms, will deliver promptly to the party initially providing such confidential information (or destroy and certify to such other party the destruction of) all copies of such information (and any copies, compilations or extracts thereof or based thereon) then in their possession or under their control. Each party hereto agrees that money damages would not be a sufficient remedy for any breach of this Section 5.3 by the other party hereto or any of its Representatives, and that, in addition to all other remedies, such non-breaching party shall be entitled to specific performance and injunctive or other equitable relief as a remedy for any such breach, and each such party further agrees to waive and to use its best efforts to cause its Representatives to waive, any requirement for the securing or posting of any bond in connection with any such remedy. Each party agrees to be responsible for any breach of this Section 5.3 by any of its Representatives. Nothing contained in this Section 5.3 shall affect, modify or otherwise limit the respective agreements and other obligations of the Buyer, on the one hand, and the Company, on the other, contained in that certain Confidentiality Agreement dated as of March 4, 2002 or any other agreement of a party with respect to the confidentiality of information relating to the Acquired Companies or the Properties (collectively, the "Confidentiality Agreement"), which Confidentiality Agreement shall remain in full force and effect.

Section 5.4 Regulatory and Other Authorizations; Consents.

(a): The Company shall use its reasonable best efforts to obtain (or cause the Acquired Companies or Affiliated Property Owners, as applicable, to obtain) the authorizations, consents, orders and approvals listed on Schedule 3.6, and the Buyer shall cooperate fully with the Company in promptly seeking to obtain all such authorizations, consents, orders and approvals.
(b): The Buyer shall use its commercially reasonable efforts to assist the Company in obtaining the consents of third parties listed in Schedule 3.6, including (i) providing to such third parties such financial statements and other financial information as such third parties may reasonably request, and (ii) executing agreements to effect the assumption of such agreements on or before the Closing Date effective from and after the Closing Date.

Section 5.5 Further Action. Each of the parties hereto shall use its respective reasonable best efforts to take or cause to be taken all appropriate action, do or cause to be done all things necessary, proper or advisable, and execute and deliver such documents and other papers, as may be required to carry out the provisions of this Agreement and consummate and make effective the transactions contemplated by this Agreement.

Section 5.6 Press Releases. The parties hereto will, and will cause each of their Affiliates to, maintain this Agreement confidential and will not, and will cause each of their Affiliates not to, issue or cause the publication of any press release or other public announcement with respect to this Agreement or the transactions contemplated hereby without the prior written consent of the other party hereto, which consent shall not be unreasonably withheld; provided, however, that nothing herein will prohibit the Company or the Buyer from issuing or causing publication of any such press release or public announcement to the extent that such party reasonably determines, after consultation with outside legal counsel, such action to be required by Law or the rules of any applicable self-regulatory organization, in which event such party will use its reasonable best efforts to allow the other party reasonable time to comment on such release or announcement in advance of its issuance.

Section 5.7 No Solicitation

(a): Unless and until this Agreement shall have been terminated in accordance with its terms, the Company agrees and covenants that the Company shall not, and shall direct and use its reasonable best efforts to cause its Representatives not to, directly or indirectly, initiate, solicit or encourage any inquiries or the making or implementation of any proposal or offer, or negotiate or enter into any agreement (or provide any information that would facilitate any such proposal or offer) with respect to a merger, acquisition or similar transaction involving the purchase of the Acquired Companies or the Acquired Companies interests in Affiliated Property Owners, all or substantially all of the Properties or all or substantially all of the Interests, or any other transaction that would prevent, frustrate or make impossible the consummation of the transactions contemplated by this Agreement. Upon receiving any such proposal or offer, or any request for information, the Company shall promptly notify the Buyer.
(b): From the date of this Agreement until the earlier of the Closing or one year from the date of this Agreement, the Buyer shall not, and use its reasonable best efforts to ensure that its Representatives do not, directly or indirectly, (i) solicit for employment or employ any officer, employee or consultant of any of the Acquired Companies or the Affiliated Property Owners, (ii) encourage, induce or attempt to induce any officer, employee or consultant of any of the Acquired Companies or the Affiliated Property Owners to terminate his or her employment or consulting relationship with any of the Acquired Companies or Affiliated Property Owners, as applicable, (iii) interfere with the business or operations of any of the Acquired Companies or Affiliated Property Owners, or (iv) take or fail to take any actions that would reasonably be expected to adversely affect the Acquired Companies' or Affiliated Property Owners' business, tenants or joint venture partners relationships with its tenants or joint venture partners or goodwill.

Section 5.8 Tax Returns.

(a): Subject to Section 5.8(b) hereof, the Buyer shall timely and properly prepare and file, or cause to be prepared and filed, on or before the due date or any extension thereof all Tax Returns required to be filed by the Company with respect to taxable periods ending on or before the Closing Date. The parties agree that the amounts payable to the employees by the Company or the Partners pursuant to Section 5.9(d) hereof shall be a compensation deduction by the Company with respect to the period ending on the Closing Date as specified in the instructions with respect to such payments delivered by the Company or the Partners pursuant to Section 5.9(d) hereof. Any Taxes due by the Acquired Companies shown on such returns attributable to periods ending on or before the Closing Date, to the extent that sufficient cash to pay such liability has not been retained by the Company pursuant to an accrued tax liability, shall be subject to Section 7.2. The income of the Acquired Companies will be apportioned to the period up to and including the Closing Date and the period after the

Closing Date by closing the books of the Acquired Companies as of the end of the Closing Date.

(b): Treasury Form 1065 for the Company and each of its Subsidiaries for calendar year 2002, or any portion of such year up to the Closing Date, shall be prepared by the Buyer substantially in accordance with past methods and practices of the Company and its Subsidiaries by no later than thirty (30) days prior to the due date for such return (including any extension of such due date). A draft of such return shall be submitted to each of the Partners holding Class A Interests and a representative of the Partners holding Class B Interests for review and comment, which comments must be submitted to the Buyer no later than ten (10) days prior to the due date for such return (including any extension of such due date). The Buyer shall take into consideration any comments received in finalizing such returns but shall not be bound to adopt any such comments. After the Closing, the Partners shall, and shall cause their respective Affiliates to, cooperate fully with the Buyer in connection with any tax investigation or audit relating to the Acquired Companies. Any information obtained pursuant to this Section 5.8 or pursuant to any other Section hereof providing for the sharing of information or the review of any Tax Return or other schedule relating to taxes shall be subject to Section 5.3 hereof.
(c): The Buyer and the Company shall agree, on or prior to the Closing Date, on the allocation of the total consideration being paid by the Buyer (including the assumption of liabilities) among all of the Properties and other assets of the Acquired Companies and Affiliated Property Owners.

Section 5.9 Employee Matters.

(a)

Employees.

(i): The Buyer shall ensure that all persons who were employed by the Acquired Companies immediately preceding the Closing Date, including those on vacation, leave of absence or disability (the "Acquired Companies Employees"), will remain employed in a comparable position on and immediately after the Closing Date for such period of time as determined by the Buyer, at not less than the same base rate of pay and bonus opportunity.
(ii): To the extent permissible under applicable law and to the extent that service is relevant for purposes of eligibility and vesting under any employee benefit plan, program or arrangement established or maintained by the Buyer (other than benefit accrual under any defined benefit pension plan) following the Closing Date for the benefit of Acquired Companies Employees, at such time as any employee benefit plan, program or arrangement is made available to Acquired Companies Employees, such plan, program or arrangement shall credit such employees for service on or prior to the Closing Date that was recognized by the Acquired Companies for purposes of employee benefit plans, programs or arrangements (including vacation policies) maintained by any of them. In addition, with respect to any welfare benefit plan (as defined in Section 3(1) of ERISA) established or maintained by the Buyer following the Closing Date for the benefit of Acquired Companies Employees, the Buyer shall use reasonable best efforts to request its insurer to waive any pre-existing condition exclusions and provide that any covered expenses incurred during the 2002 plan year on or before the Closing Date by an Acquired Company Employee or by a covered dependent shall be taken into account for purposes of satisfying applicable deductible coinsurance and maximum out-of-pocket provisions after the Closing Date.

(iii): The Buyer agrees that either the Buyer or the Acquired Companies will make COBRA continuation coverage available to individuals who are COBRA qualified beneficiaries under the Benefit Plans immediately prior to the Closing Date.

(b): Employee Benefits. Following the Closing Date, the Buyer shall provide the Acquired Companies Employees with benefits that are no less favorable, in the aggregate, to the benefits provided under the Benefit Plans as in effect immediately prior to the Closing Date, except to the extent described in (c) below.
(c): Other Employee Benefits. From and after the Closing Date, the Buyer shall and will cause the Acquired Companies to honor in accordance with their terms (i) all of the Employment Agreements, including without limitation all obligations to make severance payments provided in such employment agreements; and (ii) all of the severance agreements or arrangements between any of the Acquired Companies and the Acquired Companies Employees in effect as of the date hereof and listed on Schedule 3.12; and the Buyer will not, and will not cause any of the Acquired Companies to, challenge the validity of any obligation of any of the Acquired Companies under any such severance agreements or arrangements and employment agreements. The Buyer and the Acquired Companies acknowledge and agree that the Merger constitutes a "Change in Control" as defined in the Employment Agreements, the Westcor Realty Limited Partnership 1998 Management Incentive Compensation Plan, as amended (the "1998 Incentive Plan") and the Westcor Realty Limited Partnership 1998 Phantom Equity Participation Plan (the "1998 Equity Plan").
(d): Management Plans. With respect to the 1998 Equity Plan and the 1998 Incentive Plan, the parties acknowledge and agree that, as a result of the Merger, all Awards (as defined in the 1998 Equity Plan and the 1998 Incentive Plan) will be fully earned, subject to the following sentence. At or prior to the Closing, the Company or Westcor Partners, L.L.C. shall make adequate provision (including, without limitation, appropriately funding the Holdback Escrow pursuant to Section 2.7(f)) for the payment of each Award (as calculated under the 1998 Equity Plan with reference to a Change in Control transaction) to each Participant (as defined in the 1998 Equity Plan and the 1998 Incentive Plan) such that payment of such Awards shall occur as soon as practicable following the Closing and a verification of financial results. Payment for all such Awards shall be funded through an escrow account established by the Partners (the "Holdback Escrow"), and the Partners agree that, as between the Partners and the Buyer, the Partners shall be liable for such payment. The Buyer agrees to grant the Partners and their Representatives reasonable access following the Closing (upon reasonable notice) to the books and records of the Company relating to pre-Closing periods solely for the purpose of conducting the verification of financial results necessary prior to payment of the Awards. Solely as a matter of administrative convenience, the Buyer agrees that, upon the receipt of notice from the Indemnification Representative, the payment of all or a portion of such Awards (as specified in such notice) shall be processed through the Buyer's payroll as compensation payments following the Closing, and the Partners shall severally, but not jointly, indemnify the Buyer for any Losses that the Buyer incurs with respect to the payment or non-payment of, or any claim related to, any Award, which indemnification obligation shall not be subject to any threshold or limitation in amount or time otherwise provided in this Agreement. The Indemnification Representative shall provide to the escrow agent responsible for the Holdback Escrow, which shall then provide to the Buyer, information as to the amount of the Award payable to each Participant, including the amount of all required tax withholdings, and Buyer's sole responsibility is to process such payments pursuant to the instructions.
(e): Indemnity. Anything in this Agreement to the contrary notwithstanding, the Buyer hereby agrees to indemnify the Partners and their respective Affiliates against and hold the Partners

and their respective Affiliates harmless from any and all Losses arising out of or otherwise in respect of (i) any claim made or arising after the Closing by any Acquired Companies Employee against the Partners or any of their respective Affiliates for any severance or termination benefits pursuant to the provisions of the severance arrangements and employment agreements disclosed on Schedule 3.12, (ii) any action taken after the Closing by the Buyer with respect to any plan (including any Benefit Plan), (iii) any claim for payments or benefits by Acquired Companies Employees or their beneficiaries under any Benefit Plan arising after the Closing, and (iv) any failure of the Buyer to discharge its obligations under this Article V (but excluding the Partners' several obligations to fund and pay the Awards in accordance with Section 5.9(d) hereof, and to indemnify the Buyer for any claims with respect to such Awards).

(f): No Third Party Beneficiaries. No provision contained in this Agreement shall create any third party beneficiary rights in any employee or former employee (including any beneficiary or dependent thereof) of any Acquired Company in respect of continued employment (or resumed employment) for any specified period of any nature or kind whatsoever.

Section 5.10 Conveyance Taxes; Costs. The Buyer shall be liable for and shall hold the Company and the Partners harmless against any transfer, value added, excise, stamp, recording, registration and any similar Taxes that become payable in connection with the transactions contemplated hereby. Notwithstanding the foregoing, the Partners severally, and not jointly, shall be liable for and hold the Buyer harmless against certain city, county, municipal or local conveyance Taxes (the "Municipal Taxes") to the extent such Municipal Taxes are actually incurred; provided that the Buyer (a) shall timely prepare, or cause to be prepared, any Tax Returns with respect to such Municipal Taxes (or any transaction giving rise or purportedly giving rise to such Municipal Taxes) required to be filed by applicable Law, in each case, in form and substance reasonably satisfactory to the Company and the Indemnification Representative, on behalf of the Partners, and otherwise cooperate in good faith with the Company and the Indemnification Representative, as the case may be, in such preparation of such Tax Returns, (b) shall timely file, or cause to be filed, such Tax Returns with the appropriate Governmental Authorities, and (c) shall otherwise cooperate in good faith with the Company and the Indemnification Representative in the preparation and filing of such Tax Returns; provided further that (1) the Buyer shall promptly notify the Indemnification Representative of any notice of a proposed assessment or claim in an administrative, judicial or other proceeding that, if determined adversely to the taxpayer, would be grounds for indemnification under this sentence, and (2) the Indemnification Representative (on behalf of the Partners), at its option, shall have the right to defend any administrative, judicial or other proceeding in such manner as it may deem appropriate with respect to such claimed Municipal Taxes. Without limiting the parties' rights set forth in the preceding sentences, the Buyer and the Company agree to use good faith efforts to agree upon and establish a mutually acceptable escrow arrangement that will be in addition to any other escrow arrangement provided for hereunder and will serve as the sole remedy for satisfying the Partners' obligations under this Section 5.10. The Buyer's right to indemnification pursuant to this Section 5.10 is and shall be deemed to be a right to indemnification under Article VII hereof. Notwithstanding the foregoing, this Section 5.10 shall terminate and be of no further force and effect to the extent that the Company, prior to the Closing Date, pays amounts due pursuant to or obtains estoppels or other releases from the Governmental Authorities applicable to such Municipal Taxes. The inclusion of this Section 5.10 is not an admission by any party hereto that any Acquired Company, Affiliated Property Owner, Property or any party hereto, or the Merger or any other transaction contemplated hereunder, is subject to any Municipal Tax or to any other Tax liability related thereto.

Section 5.11 Existing Partnership Indemnification Rights. Subject to applicable Law and the rules of any securities exchange on which the Buyer's securities may be listed, the Buyer agrees to honor and to continue in full force and effect all rights to exculpation and indemnification existing in favor of, and

all limitations on the personal liability of, the general partner, the limited partners and the members of the "management committee" (as such term is used in the Limited Partnership Agreement) of the Company and each of their respective Representatives as of the Closing (the "Indemnified Persons") provided for in the Limited Partnership Agreement as in effect as of the date hereof, including without limitation the provisions of Sections 8.4 and 8.5 of the Limited Partnership Agreement, with respect to matters occurring prior to and through the Closing, and specifically including the transactions contemplated hereby, for a period of six (6) years from the Closing; provided, however, that all rights to indemnification in respect of any claims (each, a "Claim") asserted or made within such period shall continue until the disposition of such Claim. Following the Closing, the Buyer shall not, and shall not permit the Surviving Partnership to, amend or modify the certificate of limited partnership or limited partnership agreement of the Surviving Partnership if the effect of such amendment or modification would be to lessen or otherwise adversely affect the exculpation or indemnification rights of such Indemnified Persons or limitation of liability of such Indemnified Persons as provided therein. In the event that the Surviving Partnership transfers all or substantially all of its properties and assets to any Person or Persons in one or a series of transactions (whether by merger, sale of equity interests, sale of assets or other legal structure), then and in each such case, proper provision shall be made so that the transferee of such properties or assets shall assume the obligations of the Surviving Partnership under this Section 5.11. This Section 5.11 is intended to benefit each of the Indemnified Persons and their respective heirs, successors, assigns and personal representatives, each whom shall be entitled to enforce the provisions hereof and, notwithstanding anything in this Agreement to the contrary, each of whom shall be deemed and is expressly made third party beneficiaries under and with respect to this Agreement.

Section 5.12 Notice of Certain Facts. From the date of this Agreement until the Closing, each party shall promptly notify and inform the other of any material variance or incorrect statement in the representations and warranties contained in Article III of this Agreement discovered by such party or its Representatives, and shall use commercially reasonable efforts to remedy the same. Upon reasonable notice to the other party, either party may supplement its schedules to this Agreement from time to time prior to the Closing with respect to any matter that, if existing or occurring at or prior to the Closing Date, would have been required to be set forth on such party's schedules or that is necessary to complete or correct any information contained in any representation or warranty made by such party, provided that any such supplement shall not serve to cure any breach of or inaccuracy in a representation or warranty previously made by the disclosing party, and shall not be deemed or construed as a waiver of the non-disclosing party's rights with respect to any such breach or inaccuracy.

Section 5.13 Resolution of Certain Litigation. The Partners shall severally, and not jointly, indemnify the Buyer against Losses incurred by the Buyer following Closing that are related to and arise out of that certain litigation matter referenced in Item A.1. on Schedule 3.7 (the "Specified Litigation"). Without limiting the foregoing, the parties hereto agree to use good faith efforts to agree upon and establish an escrow arrangement, which will be in addition to any other escrow arrangement provided for hereunder, and will serve as the sole remedy for satisfying the Partners' obligations under this Section 5.13. The Buyer's right to indemnification pursuant to this Section 5.13 is and shall be deemed to be a right to indemnification under Article VII hereof. Notwithstanding the foregoing, this Section 5.13 (and the Partners' obligations hereunder) shall terminate and be of no further force and effect in the event that the Company, prior to the Closing Date, settles the Specified Litigation without ongoing obligations of any Acquired Company or Affiliated Property Owner or the Specified Litigation is dismissed with prejudice by, or the subject of a final non-appealable order of, a court of competent jurisdiction. The inclusion of this Section 5.13 is not an admission by any party hereto that any Acquired Company, Affiliated Property Owner, Property or any party hereto, is subject to any liability to any third party whatsoever with respect to the Specified Litigation.

ARTICLE VI
CONDITIONS TO CLOSING

Section 6.1 Conditions to the Obligations of Each Party. The respective obligations of each party to consummate the transactions contemplated by this Agreement shall be subject to the satisfaction or waiver (in writing), at or prior to the Closing, of each of the following conditions, any or all of which may be waived, in whole or in part by the parties hereto (but only to the extent that such matter is a precondition to the obligations of such waiving party), to the extent permitted by applicable law:

(a): Governmental Approval. The Buyer, Acquisition Sub and the Company shall have timely obtained from each Governmental Authority all approvals, waivers and consents listed on Schedule 6.1 hereto (the "Required Approvals"); and
(b): No Order. No Governmental Authority or court of competent jurisdiction shall have enacted, issued, promulgated, enforced or entered any statute, rule, regulation, injunction or other order (whether temporary, preliminary or permanent) that is in effect and has the effect of making the transactions contemplated by this Agreement for the Closing illegal or otherwise restraining or prohibiting consummation of such transactions, or that would reasonably be expected to have a Material Adverse Effect. In the event an injunction or other order shall have been issued, each party agrees to use its reasonable best efforts to have such injunction or other order lifted.

Section 6.2 Conditions to Obligations of the Company. The obligations of the Company to consummate the transactions contemplated by this Agreement shall be subject to the satisfaction or waiver, at or prior to the Closing, of each of the following conditions:

(a): Representations and Warranties. Each of the representations and warranties of the Buyer and Acquisition Sub contained in this Agreement that are qualified as to materiality shall be true and correct in all respects and all other representations and warranties of the Buyer and Acquisition Sub contained in this Agreement shall be true and correct in all material respects, in each case on and as of the Closing Date, with the same effect as though made on and as of the Closing Date, except to the extent such representations and warranties are specifically made as of a particular date or as of the date of this Agreement (in which case such representations and warranties shall be true and correct as of such date), in all cases without giving effect to any supplement to the Buyer Disclosure Schedules; and the Company shall have received a certificate dated as of the Closing Date executed by a duly authorized officer of the Buyer and the general partner of Acquisition Sub certifying to such effect, although such certificate shall give full effect to any supplement to the Buyer Disclosure Schedules;

(b): Covenants. All covenants contained in this Agreement to be performed or complied with by the Buyer or Acquisition Sub on or before the Closing shall have been performed or complied with in all material respects, and the Company shall have received a certificate dated as of the Closing Date executed by duly authorized officer of the Buyer and the general partner of Acquisition Sub certifying to such effect, although such certificate shall give full effect to any supplement to the Buyer Disclosure Schedules;
(c): Consents. The Buyer and Acquisition Sub, as applicable, shall have received those material consents to the transactions contemplated hereby listed on Schedule 6.2 hereto;
(d): Legal Opinion. The Company shall have received from counsel to the Buyer and Acquisition Sub an opinion substantially in the form of Exhibit E attached hereto addressed to the Company and dated as of the Closing Date;
(e): Secretary's and General Partner's Certificates. The Company shall have received a certificate from each of the secretary of the Buyer and the general partner of Acquisition Sub, dated as of the Closing Date, certifying as to such entity's respective organization documents, the incumbency of its respective officers or other signatories and the resolutions adopted by, with respect to the Buyer, the board of directors and stockholders, if applicable, and with respect to Acquisition Sub, the general partner and limited partners, if applicable.
(f): Indemnification Escrow Agreement. The Buyer shall have entered into the Indemnification Escrow Agreement.
(g): Deposit. The Buyer and the Company shall have delivered joint written instructions to the Escrow Agent directing it to deliver the Deposit into the Indemnification Escrow Amount and the Escrow Agent shall have complied with such instructions.
(h): Pre-Closing Distribution. Pre-Closing Distributions shall have occurred in accordance with Section 2.8 hereof.

Section 6.3 Conditions to Obligations of the Buyer and Acquisition Sub. The obligations of the Buyer and Acquisition Sub to consummate the transactions contemplated by this Agreement shall be subject to the satisfaction or waiver by the Buyer or Acquisition Sub, at or prior to the Closing, of each of the following conditions:

(a): Representations and Warranties. Each of the representations and warranties of the Company contained in this Agreement that are qualified as to materiality shall be true and correct in all respects and all other representations and warranties of the Company contained in this Agreement shall be true and correct in all material respects, in each case on and as of the Closing Date, with the same effect as though made on and as of the Closing Date, except to the extent such representations and warranties are specifically made as of a particular date or as of the date of this Agreement (in which case such representations and warranties shall be true and correct as of such date), in all cases without giving effect to any supplement to the Company Disclosure Schedules; and the Buyer shall have received a certificate dated as of the Closing Date executed by the general partner of the Company certifying to such effect, although such certificate shall give full effect to any supplement to the Company Disclosure Schedules.
(b): Covenants. All covenants contained in this Agreement to be performed or complied with by the Company on or before the Closing shall have been performed or complied with in all material respects, and the Buyer shall have received a certificate dated as of the Closing Date executed by the general partner of the Company certifying to such effect, although such certificate shall give full effect to any supplement to the Company Disclosure Schedules.

(c): Consents. The Company shall have received those material consents to the transactions contemplated hereby listed on Schedule 6.3 hereto.
(d): Legal Opinion. The Buyer and Acquisition Sub shall have received from counsel to the Company an opinion substantially in the form of Exhibit F attached hereto addressed to the Buyer and Acquisition Sub dated as of the Closing Date.
(e): Secretary's Certificate. The Buyer and Acquisition Sub shall have received a certificate from the Secretary of the Company, dated as of the Closing Date, certifying as to the Company's organization documents, the incumbency of its officers or other signatories and the resolutions adopted by the management committee.
(f): Indemnification Escrow Agreement. The Company shall have entered into the Indemnification Escrow Agreement.
(g): Deposit. The Buyer and the Company shall have delivered joint written instructions to the Escrow Agent directing it to deliver the Deposit into the Indemnification Escrow Amount and the Escrow Agent shall have complied with such instructions.
(h): No MAE. No event or occurrence shall have occurred that individually or in the aggregate shall have had or would reasonably be expected to have a Material Adverse Effect.
(i): Funding of Awards. After giving effect to any transfer to the Holdback Escrow pursuant to Section 2.7(f) hereof, funds sufficient to pay all Awards under the 1998 Equity Plan and the 1998 Incentive Plan shall be in escrow and available for disbursement to participants of each such plan in accordance with Section 5.9 hereof.
(j): Termination of Contracts with Interested Persons. The Company and the Partners shall have terminated, without further liability or obligation to any Acquired Company, the contracts and agreements with Affiliates listed on Schedule 6.3(j).

ARTICLE VII
INDEMNIFICATION

Section 7.1 Survival

(a): Subject to the limitations and other provisions of this Agreement, the representations and warranties of the parties hereto contained herein, as the case may be, shall survive the Closing and shall remain in full force and effect, until the close of business on the date that is one year from the Closing Date. There shall be no limitation as to time for any claims (i) based on fraud or intentional misrepresentation, or (ii) with respect to Section 2.8, 5.9(d), 5.10 and 5.13.
(b): Subject to the limitations and other provisions of this Agreement, each covenant and agreement of the parties hereto contained herein shall survive the Closing and shall remain in full force and effect until (i) the close of business on the date that is one year from the Closing Date, or (ii) if specified herein, until the end of the applicable period specified elsewhere in this Agreement with respect to such covenant or agreement.

Section 7.2 Indemnification by the Partners.

(a): The Partners agree, subject to the other terms and conditions of this Agreement, to severally (pro rata in accordance with their Interests), but not jointly, indemnify the Buyer and its Affiliates, officers, directors, employees, agents, successors and assigns (each a "Buyer Indemnified Party") against and hold them harmless from all Losses arising out of (i) the breach of, or inaccuracy in, any representation or warranty of the Company contained in this Agreement or in any certificate, instrument or other document or agreement delivered by or

on behalf of the Company to the Buyer pursuant to Section 6.3 of this Agreement, and (ii) any breach of or failure to perform any covenant or agreement of the Company contained herein or in any such certificate, instrument, document or agreement. Notwithstanding anything to the contrary contained in this Article VII, but subject to the last sentence of this Section 7.2(a), no claim may be asserted nor any action commenced against the Partners for breach of any representation, warranty or covenant by the Company contained herein, unless written notice of such claim or action (a "Claim Notice") is received by the Indemnification Representative on or prior to the date on which the representation, warranty or covenant on which such claim or action is based ceases to survive in accordance with Section 7.1 (the "Indemnification Cut-Off Date"), and such claim or action arose on or prior to the Indemnification Cut-Off Date, in which case such representation, warranty or covenant, and the Buyer's right to indemnification hereunder will survive as to such claim until such claim has been finally resolved in accordance with the terms of this Article VII. Such Claim Notice shall contain (A) a description and the amount (the "Claimed Amount") of any Losses incurred or reasonably expected to be incurred by the Buyer Indemnified Party, (B) a statement that the Buyer Indemnified Party is entitled to indemnification under this Article VII for such Losses and a reasonable explanation of the basis therefor and (C) a demand for payment in the amount of such Losses. The Buyer Indemnified Party must also deliver a copy of such Claim Notice to the Escrow Agent simultaneously with delivery of the Claim Notice to the Indemnification Representative. The Partners shall severally, and not jointly, indemnify the Buyer Indemnified Parties pursuant to this Section 7.2(a) notwithstanding any investigation made at any time or on behalf of any party hereto; provided that the Partners shall not be obligated to indemnify the Buyer with respect to a breach of, or inaccuracy in, a representation or warranty to the extent that a Buyer Knowledge Party had actual knowledge of the existence of such breach or inaccuracy on or before the Closing Date.

(b): The indemnification obligations of the Partners pursuant to Section 7.2(a) shall not be effective until the aggregate dollar amount of all Losses that would otherwise be indemnifiable pursuant to Section 7.2(a) exceeds Five Million Dollars ($5,000,000) (the "Threshold Amount") and then the Partners shall be liable for Losses from the first dollar, without regard to the Threshold Amount; provided that the Threshold Amount shall not apply to any claim arising under Section 2.8(d), 2.9(a)(ii), 5.9(d), 5.10 or 5.13 hereof. The indemnification obligations of the Partners pursuant to Section 7.2(a) shall be effective only until the aggregate dollar amount paid in respect of the Losses indemnified against under Section 7.2(a) equals Twenty Million Dollars ($20,000,000) (the "Maximum Amount") for all Losses; provided that the Maximum Amount shall not apply to any Losses based on any claim of fraud or intentional misrepresentation, or arising under Section 2.8(d), 5.9(d), 5.10 or 5.13 hereof; provided further that the Maximum Amount for Losses based on any claim under Section 2.9(a)(ii) shall be Two Million Dollars ($2,000,000).

For purposes of this Section 7.2(b), in computing such individual or aggregate amounts of claims, the amount of any insurance proceeds and any indemnity, contribution or other similar payment actually received by the Buyer Indemnified Parties from any third party with respect thereto shall be deducted from each such claim. A Buyer Indemnified Party shall exhaust all of its remedies against applicable insurers, indemnitors or contributors prior to seeking indemnification hereunder. The amount of Losses otherwise recoverable under this Section 7.2 shall be adjusted to the extent to which any federal, state, local or foreign tax liabilities or benefits are realized by the Buyer Indemnified Parties primarily by reason of any Loss or indemnity payment hereunder.

(c): A Buyer Indemnified Party shall give the Person or Persons designated as the representative or representatives of the Partners with respect to post-closing matters under Article II and this Article VII hereof (the "Indemnification Representative") written notice of any claim, assertion,

event or proceeding by or in respect of a third party as to which such Buyer Indemnified Party may request indemnification hereunder or as to which the Threshold Amount may be applied as soon as is practicable and in any event within thirty (30) days of the time that such Buyer Indemnified Party learns of such claim, assertion, event or proceeding and such notice shall describe in reasonable detail (to the extent known by the Buyer Indemnified Party) the facts constituting the basis for such suit or proceeding and the amount of the claimed damages; provided, however, that any delay in notifying the Indemnification Representative shall not affect rights to indemnification hereunder except to the extent that the Partners are materially prejudiced by such failure or incur additional costs or liability as a result. The Indemnification Representative shall have the right to direct, through counsel of its own choosing, the defense or settlement of any such claim or proceeding at the expense of the Partners. If the Indemnification Representative elects to cause the Partners to assume the defense of any such claim or proceeding, the Indemnification Representative shall keep the Buyer Indemnified Party advised as to the status of such suit or proceeding and defense thereof and shall consider in good faith recommendations made by the Buyer Indemnified Party with respect thereto. The Buyer Indemnified Party may participate in such defense, but in such case the expenses of the Buyer Indemnified Party shall be paid by the Buyer Indemnified Party. The Buyer Indemnified Party shall provide the Indemnification Representative with access to its records and personnel relating to any such claim, assertion, event or proceeding during normal business hours and shall otherwise cooperate with and assist the Indemnification Representative in the defense or settlement thereof. If the Indemnification Representative elects to direct the defense of any such claim or proceeding, the Buyer Indemnified Party shall not pay, or permit to be paid, any part of any claim or demand arising from such asserted liability unless the Indemnification Representative consents in writing to such payment or unless the Indemnification Representative, subject to the last sentence of this Section 7.2(c), withdraws from the defense of such asserted liability or unless a final judgment from which no appeal may be taken by or on behalf of the Partners is entered against the Buyer Indemnified Party for such liability. If the Indemnification Representative fails to defend or if, after commencing or undertaking any such defense, the Indemnification Representative fails to prosecute or withdraws from such defense, the Buyer Indemnified Party shall have the right to undertake the defense or settlement thereof, at the Partner's expense. If the Buyer Indemnified Party assumes the defense of any such claim or proceeding pursuant to this Section 7.2(c) and proposes to settle such claim or proceeding prior to a final judgment thereon or to forego any appeal with respect thereto, then the Buyer Indemnified Party shall give the Indemnification Representative prompt written notice thereof, and the Indemnification Representative shall have the right to participate in the settlement or assume or reassume the defense of such claim or proceeding. Notwithstanding the foregoing, the Partners shall not be bound by any determination of a proceeding so defended or any compromise or settlement effected without the consent of the Indemnification Representative (which consent may not be unreasonably withheld or delayed).

(d): Within twenty (20) Business Days after delivery of a Claim Notice by a Buyer Indemnified Party, the Indemnification Representative shall deliver to the Buyer Indemnified Party a written response (the "Response") in which the Indemnification Representative shall: (i) agree that the Buyer Indemnified Party is entitled to receive all of the Claimed Amount (in which case, the Indemnification Representative and the Buyer Indemnified Party shall deliver to the Escrow Agent, within three (3) Business Days following the delivery of the Response, a written notice executed by both parties instructing the Escrow Agent to distribute to the Buyer an amount of cash out of the Indemnification Escrow Amount, to the extent available, equal to the Claimed Amount), (ii) agree that the Buyer Indemnified Party is entitled to receive part, but not all, of the Claimed Amount (the "Agreed Amount") (in which case, the

Indemnification Representative and the Buyer Indemnified Party shall deliver to the Escrow Agent, within three (3) Business Days following the delivery of the Response, a written notice executed by both parties instructing the Escrow Agent to distribute to the Buyer an amount of cash out of the Indemnification Escrow Amount, to the extent available, equal to the Agreed Amount) or (iii) dispute that the Buyer Indemnified Party is entitled to receive any of the Claimed Amount. If, in the Response, the Indemnification Representative disputes its liability for all or part of the Claimed Amount, the Indemnification Representative and the Buyer Indemnified Party shall follow the procedures set forth below for the resolution of such dispute (a "Dispute").

During the fifteen (15) day period following the delivery of a Response that reflects a Dispute, the Indemnification Representative and the Buyer Indemnified Party shall use good faith efforts to resolve the Dispute. If the Buyer Indemnified Party and the Indemnification Representative should so agree, a memorandum setting forth such agreement shall be prepared and signed by both parties and furnished to the Escrow Agent. The Escrow Agent shall be entitled to rely on any such memorandum as joint instructions and shall distribute the amount of cash specified in such memorandum out of the Indemnification Escrow Amount in accordance with the terms thereof.

(e): The Indemnification Representative shall have full power and authority on behalf of the Partners to take any and all actions on behalf of, execute any and all instruments on behalf of, and execute or waive any and all rights of, the Partners under this Article VII or with respect to each Partner's interest in the Indemnification Escrow Amount. The Indemnification Representative shall initially be a committee comprised of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇, ▇▇. (with ▇▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇ also authorized to act in ▇▇. ▇▇▇▇▇▇▇'▇ and ▇▇. ▇▇▇▇'▇ place, respectively) and may be changed by the holders of a majority in interest of the Interests from time to time upon not less than ten (10) days' prior written notice to the Buyer. The Indemnification Representative may resign upon thirty (30) days' notice to the parties to this Agreement. No bond shall be required of the Indemnification Representative, and the Indemnification Representative, and shall receive no compensation for his services. Notices or communications to or from the Indemnification Representative shall constitute notice to or from the Partners. The Indemnification Representative shall be given reasonable access to information about the Buyer and the reasonable assistance of the Buyer's officers and employees for purposes of performing its duties and exercising its rights hereunder, provided that the Indemnification Representative shall treat confidentially and not disclose any nonpublic information from or about the Buyer to anyone (except on a need to know basis to individuals who agree to treat such information confidentially or in connection with any legal proceeding). Notwithstanding anything in this Agreement to the contrary, the Indemnification Representative shall incur no liability with respect to any action taken or suffered by him in connection with the execution of his duties hereunder, except for liability resulting from his own gross negligence or willful misconduct.
(f): The Buyer hereby acknowledges and agrees that, from and after the Closing, its sole and exclusive remedy with respect to any and all claims relating to this Agreement, the Merger and any other transaction contemplated by this Agreement, shall be pursuant to the indemnification provisions set forth in this Article VII and its sole and exclusive source for the satisfaction of such obligations shall be the Indemnification Escrow Amount, except for any claims based on fraud or intentional misrepresentation or arising under Section 2.8(d), 5.9(d), 5.10 or 5.13 hereof.
(g): The Partners shall have no liability under any provision of this Agreement for any consequential, exemplary or punitive damages or any multiple of damages or diminution in value. The Buyer shall take all commercially reasonable steps to mitigate Losses for which

indemnification may be claimed pursuant to this Agreement upon and after becoming aware of any event that would reasonably be expected to give rise to any such Losses.

(h): The Buyer hereby acknowledges and agrees that the Partners are not jointly liable under this Section 7.2 and that each Partner is liable only for damages, in the aggregate, up to, but not exceeding, the percentage of the Indemnification Escrow Amount to which such Partner would be entitled if the entire Indemnification Escrow Amount were distributed to the Partners, and such Indemnification Escrow Amount shall serve as the sole and exclusive remedy for satisfaction of such Partner's obligations pursuant to this Article VII, subject to Section 7.2(f) hereof. There shall be no right of contribution between and among the Partners with respect to their indemnification obligations under this Article VII.

Any liability for indemnification under this Section 7.2 shall be determined without duplication of recovery by reason of the state of facts giving rise to such liability constituting a breach of more than one representation, warranty, covenant or agreement.

Section 7.3 Indemnification by the Buyer.

(a): The Buyer agrees, subject to the other terms and conditions of this Agreement to indemnify the Partners and their respective Affiliates, officers, directors, employees, agents, successors and assigns (each a "Partners Indemnified Party") against and hold them harmless from all Losses arising out of (i) the breach of, or inaccuracy in, any representation or warranty of the Buyer contained in this Agreement or in any certificate, instrument or other document or agreement delivered by or on behalf of the Buyer to the Company pursuant to Section 6.2 of this Agreement, and (ii) any breach of or failure to perform any covenant or agreement of the Buyer contained herein, or in any such certificate, instrument, document or agreement delivered by or on behalf of the Buyer pursuant to this Agreement. Anything in Section 7.1 to the contrary notwithstanding, no claim may be asserted nor may any action be commenced against the Buyer for breach of any representation, warranty or covenant contained herein, unless a Claim Notice is received by the Buyer on or prior to the Indemnification Cut-Off Date relating to the representation, warranty or covenant on which such claim or action is based and such claim or action arose on or prior to such Indemnification Cut-Off Date, in which case such representation, warranty or covenant will survive as to such claim until such claim has been finally resolved. Such Claim Notice shall contain (A) a description and the Claimed Amount of any Losses incurred or reasonably expected to be incurred by the Partners Indemnified Party, (B) a statement that the Partners Indemnified Party is entitled to indemnification under this Article VII for such Losses and a reasonable explanation of the basis therefor and (C) a demand for payment in the amount of such Losses. The Buyer shall be obligated to indemnify the Partners Indemnified Parties pursuant to this Section 7.3(a) notwithstanding any investigation made at any time or on behalf of any party hereto; provided that the Buyer shall not be obligated to indemnify the Partners with respect to a breach of, or inaccuracy in, a representation or warranty to the extent that a Company Knowledge Party had actual knowledge of the existence of such breach or inaccuracy on or before the Closing Date.
(b): The indemnification obligations of the Buyer pursuant to Section 7.3(a) shall not be effective until the aggregate dollar amount of all Losses that would otherwise be indemnifiable pursuant to Section 7.3(a) exceeds the Threshold Amount, and then only to the extent such aggregate amount exceeds the Threshold Amount. The indemnification obligations of the Buyer pursuant to Section 7.3(a) shall be effective only until the aggregate dollar amount paid in respect of the Losses indemnified against under Section 7.3(a) equals the Maximum Amount for all Losses; provided that the Maximum Amount shall not apply to any Losses based on any claim of fraud or intentional misrepresentation. For purposes of this

Section 7.3(b), in computing such individual or aggregate amounts of claims, the amount of any insurance proceeds and any indemnity, contribution or other similar payment actually recovered by the Partners Indemnified Parties from any third party with respect thereto shall be deducted from each such claim. The amount of Losses otherwise recoverable under this Section 7.3 shall be adjusted to the extent any federal, state, local or foreign tax liabilities or benefits are realized by the Partners Indemnified Parties primarily by reason of any Loss or indemnity payment hereunder.

(c): A Partners Indemnified Party shall give the Buyer written notice of any claim, assertion, event or proceeding by or in respect of a third party as to which such Partners Indemnified Party may request indemnification hereunder or as to which the Threshold Amount may be applied as soon as is practicable and in any event within thirty (30) days of the time that such Partners Indemnified Party learns of such claim, assertion, event or proceeding and such notice shall describe in reasonable detail (to the extent known by the Partners Indemnified Party) the facts constituting the basis for such suit or proceeding and the amount of the claimed damages; provided, however, that any delay in notifying the Buyer shall not affect rights to indemnification hereunder except to the extent that the Buyer is materially prejudiced by such failure or incurs additional costs or liability as a result. The Buyer shall have the right to direct, through counsel of its own choosing, the defense or settlement of any such claim or proceeding at its own expense. If the Buyer elects to assume the defense of any such claim or proceeding, the Buyer shall keep the Partners Indemnified Party advised as to the status of such suit or proceeding and defense thereof and shall consider in good faith recommendations made by the Partners Indemnified Party with respect thereto. The Partners Indemnified Party may participate in such defense, but in such case the expenses of the Partners Indemnified Party shall be paid by the Partners Indemnified Party. The Partners Indemnified Party shall provide the Buyer with access to its records and personnel relating to any such claim, assertion, event or proceeding during normal business hours and shall otherwise cooperate with and assist the Buyer in the defense or settlement thereof. If the Buyer elects to direct the defense of any such claim or proceeding, the Partners Indemnified Party shall not pay, or permit to be paid, any part of any claim or demand arising from such asserted liability, unless the Buyer consents in writing to such payment or unless the Buyer, subject to the last sentence of this Section 7.3(c), withdraws from the defense of such asserted liability, or unless a final judgment from which no appeal may be taken by or on behalf of the Buyer is entered against the Partners Indemnified Party for such liability. If the Buyer fails to defend or if, after commencing or undertaking any such defense, the Buyer fails to prosecute or withdraws from such defense, the Partners Indemnified Party shall have the right to undertake the defense or settlement thereof, at the Buyer's expense. If the Partners Indemnified Party assumes the defense of any such claim or proceeding pursuant to this Section 7.3(c) and proposes to settle such claim or proceeding prior to a final judgment thereon or to forego appeal with respect thereto, then such Partners Indemnified Party shall give the Buyer prompt written notice thereof and the Buyer shall have the right to participate in the settlement or assume or reassume the defense of such claim or proceeding. Notwithstanding the foregoing, the Buyer shall not be bound by any determination of a proceeding so defended or any compromise or settlement effected without its consent (which consent may not be unreasonably withheld or delayed).
(d): Within twenty (20) Business Days after delivery of a Claim Notice by a Partners Indemnified Party, the Buyer shall deliver to the Indemnification Representative a Response in which the Buyer shall: (i) agree that the Partners Indemnified Party is entitled to receive all of the Claimed Amount (in which case, the Buyer shall, within three (3) Business Days following the delivery of the Response, distribute to the Partners Indemnified Party an amount of cash equal to the Claimed Amount), (ii) agree that the Partners Indemnified Party is entitled to

receive the Agreed Amount (in which case, the Buyer shall, within three (3) Business Days following the delivery of the Response, distribute to the Partners Indemnified Party an amount of cash equal to the Agreed Amount) or (iii) dispute that the Partners Indemnified Party is entitled to receive any of the Claimed Amount. If, in the Response, the Buyer disputes its liability for all or part of the Claimed Amount, the Buyer and the Partners Indemnified Party shall follow the procedures set forth below for the resolution of such Dispute.

During the fifteen (15) day period following the delivery of a Response that reflects a Dispute, the Buyer and the Partners Indemnified Party shall use good faith efforts to resolve the Dispute. If the Partners Indemnified Party and the Buyer should so agree, a memorandum setting forth such agreement shall be prepared and signed by both parties and the Buyer shall, within three (3) Business Days, distribute the amount of cash specified in such memorandum in accordance with the terms thereof.

(e): From and after the Closing, the Partners' sole and exclusive remedy with respect to any and all claims relating to this Agreement shall be pursuant to the indemnification provisions set forth in this Article VII, except for any claims based on fraud or intentional misrepresentation.
(f): The Buyer shall have no liability under any provision of this Agreement for any consequential, exemplary or punitive damages or any multiple of damages or diminution in value. The Partners shall take all reasonable steps to mitigate Losses for which indemnification may be claimed pursuant to this Agreement upon and after becoming aware of any event that could reasonably be expected to give rise to any such Losses.

Any liability for indemnification under this Section 7.3 shall be determined without duplication of recovery by reason of the state of facts giving rise to such liability constituting a breach of more than one representation, warranty, covenant or agreement.

ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER

Section 8.1 Termination. This Agreement may be terminated:

(a): at any time prior to the Closing, by the mutual written consent of the Company, the Buyer and Acquisition Sub;
(b): by the Company, if the Closing shall not have occurred on or prior to October 31, 2002; provided, however, that the Company is not then in breach of any representation, warranty or covenant or other agreement contained herein that would cause the Company to be unable to satisfy the conditions to the Buyer's or Acquisition Sub's performance set forth in Section 6.3 hereof;
(c): by the Buyer, if the Closing shall not have occurred on or prior to October 31, 2002; provided, however, that the Buyer or Acquisition Sub is not then in breach of any representation, warranty, covenant or other agreement contained herein that would cause the Buyer or Acquisition Sub to be unable to satisfy the conditions to the Company's performance set forth in Section 6.2 hereof;
(d): by the Company (provided that the Company is not then in breach of any representation, warranty, covenant or other agreement contained herein that would cause the Company to be unable to satisfy the conditions to the Buyer's or Acquisition Sub's performance set forth in Section 6.3 hereof), upon written notice to the Buyer and Acquisition Sub, upon a material breach of any representation, warranty or covenant of the Buyer or Acquisition Sub, as the case may be, contained in this Agreement, provided that such breach is not capable of being

cured within thirty (30) days after the giving of notice thereof by the Company to the Buyer or Acquisition Sub, as the case may be;

(e): by the Buyer (provided that the Buyer is not then in breach of any representation, warranty, covenant or other agreement contained herein that would cause the Buyer or Acquisition Sub to be unable to satisfy the conditions to the Company's performance set forth in Section 6.2 hereof), upon written notice to the Company, upon a material breach of any representation, warranty or covenant of the Company contained in this Agreement, provided that such breach is not capable of being cured within thirty (30) days after the giving of notice thereof by the Buyer or Acquisition Sub to the Company; or
(f): by the Buyer upon delivery of the Termination Notice in accordance with Section 2.10 hereof.

Section 8.2 Effect of Termination.

(a): In the event of termination of this Agreement as provided in Section 8.1 hereof, this Agreement shall forthwith become void and there shall be no liability on the part of any party hereto to any other party hereto with respect to the matters contained herein, except that (i) the Company shall be entitled to receive the Signing Deposit from the Escrow Agent and (ii) as set forth in Sections 3.17, 4.6 and 5.3, and Articles VII and VIII, provided, however, that nothing herein shall relieve either party from liability for any willful breach hereof, except as provided in Section 8.2(b).
(b): Upon termination of this Agreement by the Company pursuant to Section 8.1(b) or 8.1(d), (i) there shall be no liability on the part of any party hereto except as set forth in Sections 3.17, 4.6 and 5.3, and Article VIII, and (ii) the Company shall deliver a copy of its written termination notice to the Escrow Agent and the Escrow Agent shall deliver the Physical Inspection Deposit and any income actually earned on the Physical Inspection Deposit to the Company in accordance with the Deposit Escrow Agreement. Notwithstanding anything to the contrary contained herein or in the Deposit Escrow Agreement, the parties hereto hereby acknowledge and agree that the release of the Signing Deposit pursuant to Section 8.2(a) and the Physical Inspection Deposit pursuant to this Section 8.2(b) is intended to be, and shall be construed as, liquidated damages for a breach, and shall serve as the Company's sole and exclusive remedy at law or in equity, except for any obligations of the Buyer and Acquisition Sub (or either of them) to indemnify the Company pursuant to the final sentence of Section 5.2(a). The parties have agreed that, other than for any such indemnification of the Company by the Buyer and Acquisition Sub, the Company's actual damages in the event of a termination of this Agreement would be extremely difficult or impracticable to determine. After negotiation, the parties have agreed that, considering all of the circumstances existing on the date of this Agreement, the amount of the Deposits is a reasonable estimate of the damages that the Company would incur in the event of a termination of this Agreement, other than for any Loss for which the Buyer and Acquisition Sub have expressly agreed to indemnify of the Company pursuant to the final sentence of Section 5.2(a).
(c): Upon termination by the parties pursuant to Section 8.1(a), or upon termination of the Buyer pursuant to Section 8.1(c), 8.1(e) or 8.1(f), the Buyer shall deliver a copy of a termination notice to the Escrow Agent and the Escrow Agent shall deliver the Physical Inspection Deposit and any income actually earned on the Deposits to the Buyer. Notwithstanding anything to the contrary contained herein or in the Deposit Escrow Agreement, the parties hereby acknowledges and agree that the release of the Physical Inspection Deposit pursuant to this Section 8.2(c) is not intended to be, and shall not be construed as, liquidated damages for a breach, and that such remedy is cumulative and shall not prevent the assertion by the Buyer of any other rights or the seeking of any other remedies against the Company for such breach.

(d): Upon termination of this Agreement for any reason, the party terminating the Agreement shall deliver a copy of such termination notice to the Escrow Agent and the Escrow Agent shall deliver the Signing Deposit.

Section 8.3 Waiver. At any time prior to the Closing, the Buyer, Acquisition Sub, on the one hand, and the Company, on the other hand, may (a) extend the time for the performance of any of the obligations or other acts of the other party or parties hereto, (b) waive any inaccuracies in the representations and warranties of the other party or parties contained herein or in any document delivered by such other party pursuant hereto or (c) waive compliance with any of the agreements of such other party or conditions to its own obligations contained herein. Any such extension or waiver shall be valid only if set forth in an instrument in writing signed by the party to be bound thereby. Waiver of any term or condition of this Agreement by a party shall not be construed as a waiver of any subsequent breach or waiver of the same term or condition by such party, or a waiver of any other term or condition of this Agreement by such party. The failure of any party to assert any of its rights hereunder shall not constitute a waiver of any such rights.

ARTICLE IX
GENERAL PROVISIONS

Section 9.1 Notices. Except as otherwise specifically provided herein, all notices, requests, claims, demands and other communications under this Agreement will be in writing and will be deemed given upon delivery if delivered personally or one Business Day after it is sent by overnight courier (providing proof of delivery) to the parties at the following addresses (or at such other address for a party as specified by like notice):

If to the Company:

Westcor Realty Limited Partnership
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇

With a copy to:

AEW Capital Management, L.P.
World Trade Center ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇

▇▇▇▇▇▇▇ Procter LLP
Exchange Place
Boston, MA 02109
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, P.C.
▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, P.C.

If to the Buyer or Acquisition Sub:

▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
The Macerich Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇

With a copy to:

▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
O'Melveny & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇

If to the Indemnification Representative:

Management Committee
▇/▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇.▇.
World Trade Center ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇

With a copy to:

Westcor Realty Limited Partnership
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇

Any party may give any notice, request, demand, claim or other communication hereunder using any other means (including personal delivery, expedited courier, messenger service, telecopy, telex, ordinary mail or electronic mail), but no such notice, request, demand, claim or other communication shall be deemed to have been duly given unless and until it actually is received by the party for whom it is intended. Any party may change the address to which notices, requests, demands, claims and other communications hereunder are to be delivered by giving the other parties notice in the manner herein set forth.

Section 9.2 Interpretation. When a reference is made in this Agreement to an Article, Section, Schedule or Exhibit, such reference will be to an Article or Section of, or a Schedule or Exhibit to, this Agreement unless otherwise indicated. The table of contents and headings contained in this Agreement are for reference purposes only and will not affect in any way the meaning or interpretation of this Agreement. Whenever the words "include", "includes" or "including" are used in this Agreement, they will be deemed to be followed by the words "without limitation". The words "hereof", "herein" and "hereunder" and words of similar import when used in this Agreement will refer to this Agreement as a whole and not to any particular provision of this Agreement. All terms used herein with initial capital letters have the meanings ascribed to them herein and all terms defined in this Agreement will have such defined meanings when used in any certificate, agreement or other document made or delivered pursuant hereto unless otherwise defined therein. The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such term. Any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument or statute as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments incorporated therein. References to a Person are also to its permitted successors and assigns.

Section 9.3 Counterparts. This Agreement may be executed in one or more counterparts, all of which will be considered one and the same agreement and will become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties.

Section 9.4 Entire Agreement; No Third-Party Beneficiaries; Severability. This Agreement (including the documents and instruments referred to herein), together with the Confidentiality Agreement, the Deposit Escrow Agreement and the Indemnification Escrow Agreement, constitute the entire agreement, and supersede all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter of this Agreement. Except as set forth in Section 5.11 hereof, nothing expressed or referred to in this Agreement will be construed to give any Person other than the parties hereto any legal or equitable right, remedy or claim under or with respect to this Agreement or any provision of this Agreement. If any term, condition or other provision of this Agreement is found to be invalid, illegal or incapable of being enforced by virtue of any rule of law, public policy or court determination, all other terms, conditions and provisions of this Agreement shall nevertheless remain in full force and effect.

Section 9.5 Amendment. This Agreement may not be amended or modified except (a) by an instrument in writing signed by, or on behalf of, the Company, the Buyer and Acquisition Sub or (b) by a waiver in accordance with Section 8.3.

Section 9.6 Governing Law. This Agreement will be governed by, and construed in accordance with, the internal laws of the State of Delaware regardless of the laws that might otherwise govern under applicable principles of conflict of laws.

Section 9.7 Consent to Jurisdiction. Each of the Company, the Buyer and Acquisition Sub hereby irrevocably and unconditionally consents to submit to the sole and exclusive jurisdiction of the courts of the State of Delaware and of the United States District Court for the District of Delaware (the "Delaware Courts") for any litigation arising out of or relating to this Agreement, or the negotiation, validity or performance of this Agreement, or the transactions contemplated hereby (and agrees not to commence any litigation relating thereto except in such courts), waives an objection to the laying of venue of any such litigation in the Delaware Courts and agrees not to plead or claim in any Delaware Court that such litigation brought therein has been brought in an inconvenient forum. Each of the parties hereto agrees, (a) to the extent such party is not otherwise subject to service of process in the State of Delaware, to appoint and maintain an agent in the State of Delaware as such party's agent for acceptance of legal process, and (b) that service of process may also be made on such party by prepaid certified mail with a proof of mailing receipt validated by the United States Postal Service constituting evidence of valid service. Service made pursuant to (a) or (b) above shall have the same legal force and effect as if served upon such party personally within the State of Delaware.

Section 9.8 Assignment. Neither this Agreement nor any of the rights, interests or obligations under this Agreement may be assigned, in whole or in part, by operation of law or otherwise by any of the parties hereto without the prior written consent of the other party. Any assignment in violation of the preceding sentence will be void. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of, and be enforceable by, the parties hereto and their respective successors and assigns.

Section 9.9 Expenses. Except as otherwise specified in this Agreement, all costs and expenses, including, without limitation, fees and disbursements of counsel, financial advisors and accountants, incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses, whether or not the Closing shall have occurred; provided, however, that, in the event a filing or filings pursuant to the HSR Act is required, any filing fee or fees due in connection therewith shall be shared equally by the Company on the one hand and the Buyer on the other hand.

Section 9.10 Execution by Officer of the Company. This Agreement is executed on behalf of the Company by an officer of the general partner of the Company, acting in his or her capacity as such officer, and not individually. The Buyer, Acquisition Sub and each person dealing with the Company, or claiming any rights or interests herein or hereunder, agrees to look solely to the assets of the Company for satisfaction of any obligations of the Company prior to the Closing, and they further agree that no advisor, manager, employee, officer, director or agent of the Company (in their capacity as such), shall have any personal liability hereunder or otherwise.

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IN WITNESS WHEREOF, the Company, the Buyer and Acquisition Sub have caused this Agreement to be signed as of the date first written above.

		THE COMPANY:
		WESTCOR REALTY LIMITED PARTNERSHIP
		By: Eastrich No. 128 Corp., its General Partner
		By:		/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
		Name:		▇▇▇▇▇▇ ▇▇▇▇▇▇▇
		Title:		President
		THE BUYER:
		THE MACERICH PARTNERSHIP, L.P.
		By: The Macerich Company, its General Partner
		By:		/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
		Name:		▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
		Title:		President
		MACERICH GALAHAD LP
		By: Macerich Galahad GP Corp., its General Partner
		By:		/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
		Name:		▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
		Title:		President

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Exhibit 2.1

TABLE OF CONTENTS
SCHEDULES LIST
AGREEMENT AND PLAN OF MERGER
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE BUYER AND ACQUISITION SUB
ARTICLE V CERTAIN COVENANTS AND AGREEMENTS OF THE BUYER, ACQUISITION SUB AND THE COMPANY
ARTICLE VI CONDITIONS TO CLOSING
ARTICLE VII INDEMNIFICATION
ARTICLE VIII TERMINATION, AMENDMENT AND WAIVER
ARTICLE IX GENERAL PROVISIONS

AGREEMENT AND PLAN OF MERGER by and among WESTCOR REALTY LIMITED PARTNERSHIP, MACERICH GALAHAD LP and THE MACERICH PARTNERSHIP, L.P. dated as of May 30, 2002

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Table of Contents