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EXHIBIT 4.1
REDEMPTION RIGHTS AGREEMENT
Redemption Rights Agreement, dated June 19, 1997, among GGP Limited
Partnership, a Delaware limited partnership (the "Partnership"), General Growth
Properties, Inc., a Delaware corporation (the "General Partner"), and CA
Southlake Investors, Ltd., a Georgia limited partnership (collectively,
"Contributing Partner").
R E C I T A L S
WHEREAS, concurrently herewith, Contributing Partner is being admitted as a
limited partner of the Partnership, the general partner of which is the General
Partner;
WHEREAS, shares of common stock, $.10 par value per share, of the General
Partner (the "Common Stock") are listed on the New York Stock Exchange; and
WHEREAS, the parties desire to set forth herein the terms and conditions upon
which the Contributing Partner may cause the Partnership to redeem its limited
partnership units in the Partnership.
NOW, THEREFORE, the parties hereby agree as follows:
1. Definitions. For purposes of this Agreement, the following terms shall
have the meanings set forth below:
"Acts" shall mean the Securities Act and the Exchange Act, collectively.
"Affiliates" shall mean "affiliates" as defined pursuant to the Securities
Act.
"Business Day" shall mean any day upon which commercial banks are open for
business in Chicago, Illinois.
"Cash Purchase Price" shall mean, with respect to any redeemed or purchased
Units, an amount of cash equal to the value of the Share Purchase Price
(computed as of the Computation Date and equal to the Current Per Share Market
Price on such Computation Date multiplied by the number of Shares) that would
be payable with respect to such Units assuming the Share Purchase Price were
paid in full satisfaction of the Purchase Price of such Units. In the event
that the Share Purchase Price includes securities other than Shares, then the
value of such other
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securities shall be determined by the General Partner acting in good faith on
the basis of the closing prices of securities if listed on a nationally
recognized exchange and otherwise on the basis of such quotations and other
information as the General Partner considers, in its reasonable judgment,
appropriate.
"Certificate of Incorporation" shall mean the Certificate of Incorporation of
the General Partner, as the same may be amended from time to time.
"Closing Price" shall have the meaning set forth in the Partnership
Agreement.
"Code" shall mean the Internal Revenue Code of 1986, as amended, or any
successor code.
"Common Stock" shall have the meaning set forth in the recitals.
"Computation Date" shall mean the date on which the applicable Notice is
received by the Partnership or, if such date is not a Business Day, the first
Business Day thereafter.
"Conversion Factor" shall mean 100%, provided that such factor shall be
adjusted in accordance with Section 6(a).
"Contribution Agreement" shall mean that certain Sale and Contribution
Agreement dated the date hereof, between the Partnership and Contributing
Partner, as the same have been and may hereafter be amended from time to time,
pursuant to which this Agreement is being executed.
"Current Per Share Market Price" shall have the meaning set forth in the
Partnership Agreement.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended, or
any successor statute.
"Exchange Act Reporting Company" shall mean any corporation or other entity
which is subject to the reporting requirements of the Exchange Act.
"Expiration Date" shall mean the earlier of (a) Xxxxx 00, 0000 (x) the date
upon which all Units have been redeemed or purchased in accordance with the
terms hereof.
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"Liens" shall have the meaning set forth in the Contribution Agreement.
"Major Transaction Event" shall mean, with respect to the General Partner,
(a) a reclassification, capital reorganization or other similar change
regarding or affecting outstanding Shares (other than a change addressed in
Section 6(a)); (b) a merger or consolidation of the General Partner with one or
more other corporations or entities, other than a merger pursuant to which the
General Partner is the surviving corporation and the outstanding Shares are not
affected, (c) a sale, lease or exchange of all or substantially all of the
General Partner's assets or (d) the liquidation, dissolution or winding up of
the General Partner.
"Notice" shall have the meaning set forth in Section 3.2.
"Other REIT" shall mean GGP/Homart, Inc. and any other REIT in which the
General Partner holds a direct or indirect equity interest and of which
Contributing Partner is notified in writing.
"Partnership Agreement" shall mean that certain Amended and Restated
Agreement of Limited Partnership of the Partnership, dated July 27, 1993, as
amended by that certain First Amendment thereto dated May 23, 1995, that
certain Second Amendment thereto dated June 13, 1995, that certain Third
Amendment thereto dated May 21, 1996, that certain Fourth Amendment thereto
dated August 30, 1996, that certain Fifth Amendment thereto dated as of October
4, 1996, that certain Sixth Amendment thereto dated as of November 27, 1996 and
that certain Seventh Amendment thereto dated December 6, 1996 and as the same
may be further amended through the date of this Agreement.
"Person" shall mean any natural person, corporation, partnership, limited
liability company, trust or other entity.
"Pledge Agreement" shall mean that certain Pledge Agreement of even date
herewith, between the Partnership and Contributing Partner.
"Purchase Price" shall mean the Cash Purchase Price or the Share Purchase
Price, or a combination thereof.
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"Purchase Right" shall have the meaning set forth in Section 7.1.
"Redemption Rights" shall have the meaning set forth in Section 2.
"REIT" shall mean real estate investment trust as such term is defined under
the Code.
"REIT Requirements" shall have the meaning set forth in the Partnership
Agreement, as the same may change from time to time.
"Registration Expenses" shall mean all expenses incident to the General
Partner's performance of or compliance with the registration requirements set
forth in this Agreement, including without limitation (a) the fees,
disbursements and expenses of the General Partner's counsel and accountants,
including the expenses of any special audits or "cold comfort" letters required
by or incident to such performance and compliance, in connection with the
registration of Shares issuable upon the exercise of the Redemption Rights; (b)
all expenses in connection with the preparation and printing of the
registration statement or statements, any preliminary prospectus or final
prospectus, any other offering document and amendments and supplements thereto;
(c) the cost of printing or producing any blue sky or legal investment
memoranda or other documents in connection with the offering, sale or delivery
of such Shares; (d) all expenses in connection with the qualification of such
Shares under state securities laws; (e) the fees and expenses incurred in
connection with the listing of such Shares on each securities exchange on which
securities of the same class are then listed and (f) all SEC, stock exchange
and National Association of Securities Dealers, Inc. registration and filing
fees. Notwithstanding the foregoing, Registration Expenses shall not include
(and the General Partner will pay) any costs incurred by the Partnership or the
General Partner in preparing any document that is incorporated by reference in
a registration statement, or any professional fee or other expenses, that would
have been incurred apart from the obligation of the General Partner hereunder
to file a Registration Statement.
"Retailer Interest" shall have the meaning set forth in Section 7.5.
"SEC" shall mean the Securities and Exchange Commission.
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"Securities Act" shall mean the Securities Act of 1933, as amended, or any
successor statute.
"Share Purchase Price" shall mean, with respect to the exercise of any
Redemption Rights and subject to the provisions of Section 6(c), a number of
Shares equal to the product of (a) the number of Units being redeemed or
purchased multiplied by (b) the Conversion Factor; provided, however, that, in
the event the General Partner, after the date of this Agreement, issues to all
holders of Shares rights, options, warrants or convertible or exchangeable
securities entitling the stockholders to subscribe for or purchase Shares
(other than rights referred to in Section 6(b)) or any other securities or
property, then the Share Purchase Price also shall include such rights,
options, warrants or convertible or exchangeable securities that a holder of
that number of Shares would have been entitled to receive.
"Shares" shall mean shares of the Common Stock.
"Units" shall mean the limited partnership units in the Partnership issued to
Contributing Partner pursuant to the Contribution Agreement.
"Unitholder" shall mean the Person who at the time in question holds one or
more Units in accordance with the Partnership Agreement, as the same may be
amended from time to time.
2. Grant of Redemption Rights.
(a) Upon the terms and subject to the conditions contained herein, the
Partnership does hereby grant to Contributing Partner, and Contributing Partner
does hereby accept, the right, but without obligation on the part of
Contributing Partner, to require the Partnership to redeem from time to time
part or all of their Units for the Cash Purchase Price ("Redemption Rights").
(b) Notwithstanding the provisions of Section 2(a), the General Partner
may, in its sole and absolute discretion, assume the obligation of the
Partnership with respect to and satisfy Contributing Partner's exercise of a
Redemption Right by paying to Contributing Partner, at the General Partner's
election (which may be exercised in the General Partner's sole discretion),
either the Cash Purchase Price or the Share Purchase Price (or a combination
thereof) with respect to the Units for which
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Contributing Partner exercised its Redemption Rights. If the General Partner
assumes such obligations with respect to the exercise by Contributing Partner
of a Redemption Right as to certain Units and makes the required payment within
the required period of time, then the Partnership shall have no obligation to
pay any amount to Contributing Partner with respect to the exercise of a
Redemption Right for such Units, and any Units purchased shall be owned by the
General Partner for all purposes.
(c) If the General Partner shall assume the obligations of the
Partnership with respect to and satisfy a Redemption Right, the Partnership,
the Contributing Partner and the General Partner each shall treat the
transaction between the General Partner and Contributing Partner as a sale of
Contributing Partner's Units (or a portion thereof) to the General Partner for
federal income tax purposes.
(d) Upon the redemption or purchase of part or all of Contributing
Partner's Units and the payment of the Purchase Price with respect thereto,
such Person shall be deemed withdrawn as a Partner in the Partnership to the
extent of the Units redeemed or purchased and shall have no further rights or
obligations under this Agreement with respect to such redeemed or purchased
Units; provided, however, that Contributing Partner's rights under this
Agreement with regard to any other Units will continue in full force and
effect.
(e) No fractional Shares shall be issued hereunder. In lieu of
fractional Shares, the General Partner shall pay cash based on the Current Per
Share Market Price on the relevant Computation Date.
3. Exercise of Redemption Rights.
3.1 Time for Exercise of Redemption Rights. Contributing Partner may
exercise its Redemption Rights in whole or in part and at any time and from
time to time on or after the first anniversary of the date hereof but prior to
the Expiration Date; provided, however, that the Redemption Rights may not be
exercised at any one time by Contributing Partner with respect to less than
1,000 Units (or all the Units then owned by Contributing Partner if
Contributing Partner owns less than 1,000 Units) or in the event that such
exercise of Redemption Rights (and the assignment of Units or delivery of
either the Cash Purchase Price or the Share Purchase Price with respect
thereto)
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violates the terms of the Partnership Agreement or applicable law. Once given,
a Notice shall be irrevocable subject to the payment of the Purchase Price for
the Units specified therein in accordance with the terms hereof.
3.2 Method of Exercise. The Redemption Rights shall be exercised by
written notice (the "Notice") to the Partnership in the form of Exhibit A
specifying the number of Units to be redeemed and the name or names (with
address) in which any Shares issuable upon such exercise shall be registered if
different than the Contributing Partner.
3.3 Closing. Subject to the provisions of Section 4.1(d), the closing of
the redemption or purchase and sale pursuant to an exercise of the Redemption
Rights shall occur within 30 days following the giving of the Notice.
Contributing Partner shall execute such documents as the General Partner may
reasonably require in connection with the closing of the redemption or purchase
and sale pursuant thereto.
3.4 Payment of Cash or Issuance of Shares. At the closing of the
redemption or purchase and sale of Units pursuant to an exercise of Redemption
Rights, the Partnership shall deliver to Contributing Partner the Cash Purchase
Price by check or, in the event that the General Partner has assumed the
obligations of the Partnership with respect to such exercise of Redemption
Rights, the General Partner shall deliver to the Partnership, at the election
of the General Partner, which may be exercised in the General Partner's sole
discretion, either (a) the Cash Purchase Price by check or (b) certificates
representing the Shares and any other securities constituting the Share
Purchase Price, together with cash in lieu of the issuance of any fraction of a
Share as provided in Section 2(e), or a combination thereof.
4. Matters Relating to Shares.
4.1 Registration.
(a) The General Partner shall (i) prepare, file and use reasonable
efforts to cause to become effective on or before the ninetieth day following
the first anniversary of the date hereof a registration statement, which may be
on Form S-3, under the Securities Act relating to the Shares to be issued upon
exercise of the Redemption Rights assuming full satisfaction of the Redemption
Rights by delivery of Shares and (ii) prepare and file
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with the SEC such amendments and supplements to such registration statement and
the prospectus used in connection therewith as may be necessary to keep such
registration statement effective and to comply with the provisions of the
Securities Act.
(b) The General Partner shall pay all Registration Expenses incurred
prior to the sixth anniversary of the date hereof with respect to filing and
keeping effective the registration statement through such date, and the
Unitholders (other than the Unitholders that have given a notice pursuant to
Section 4.1(c)) shall reimburse the General Partner for Registration Expenses
(or a pro rata portion of the Registration Expenses based on the number of
Shares issuable to such Unitholders upon full exercise of the Redemption Rights
of such Unitholders relative to the total number of Shares issuable pursuant to
such registration statement) which are incurred after the sixth anniversary of
the date hereof in respect of maintaining effective (but not the initial filing
and causing to become effective of) such registration statement. The
reimbursement of such expenses by the Unitholders shall be paid upon demand.
(c) Notwithstanding anything to the contrary contained herein, the
General Partner shall have no obligation to keep any registration statement
filed pursuant to this Section 4.1 effective after the Expiration Date or if
the status of the General Partner (or its successor) as an Exchange Act
Reporting Company is terminated or all of the Unitholders notify the General
Partner in writing that the General Partner no longer need keep such
registration statement effective.
4.2 Reservation of Shares. At all times while the Redemption Rights are
outstanding, the General Partner shall reserve for issuance such number of
Shares as may be necessary to enable the General Partner to issue Shares in
full satisfaction of all Redemption Rights which are from time to time
outstanding (assuming no limitations as to the ownership of such Shares under
the Certificate of Incorporation which relate to compliance with the REIT
Requirements and that the General Partner elected to pay the Share Purchase
Price with respect to all such Redemption Rights).
4.3 Fully Paid and Non-Assessable. All Shares which may be issued upon
exercise of the Redemption Rights shall be duly and validly issued and fully
paid and non-assessable.
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5. Transfer and Other Taxes. In the event that any state or local
property transfer or other tax is payable as the result of or in connection
with any exercise of the Redemption Rights by Contributing Partner, Contributor
Partner shall pay such tax, and no Shares shall be issued pursuant hereto until
such Contributor Partner has paid to the General Partner or the Partnership, as
the case may be, the amount of such tax or has provided evidence, in form
reasonably satisfactory to the General Partner or the Partnership, as the case
may be, as to the payment thereof.
6. Anti-Dilution and Adjustment Provisions.
(a) The Conversion Factor shall be adjusted in the event that the
General Partner (i) declares or pays a dividend on its outstanding Shares in
Shares or makes a distribution to all holders of its outstanding Shares in
Shares, (ii) subdivides its outstanding Shares, or (iii) combines its
outstanding Shares into a smaller number of Shares. The Conversion Factor
shall be adjusted by multiplying the Conversion Factor by a fraction, the
numerator of which shall be the number of Shares issued and outstanding on the
record date for such dividend, distribution, subdivision or combination
(assuming for such purposes that such dividend, distribution, subdivision or
combination has occurred as of such time) and the denominator of which shall be
the actual number of Shares (determined without the above assumption) issued
and outstanding on the record date for such dividend, distribution, subdivision
or combination. Any adjustment to the Conversion Factor shall become effective
immediately after the effective date of such event retroactive to the record
date, if any, for such event.
(b) If at any time the General Partner grants to its stockholders any
right to subscribe pro rata for additional securities of the General Partner,
whether Common Stock or other classifications, or for any other securities or
interests that Contributing Partner would have been entitled to subscribe for
if, immediately prior to such grant, Contributing Partner had exercised its
Redemption Rights and received the Share Purchase Price in payment thereof, in
lieu of any adjustment under any other subsection of this Section 6 or other
provision of this Agreement, then the General Partner also shall grant to
Contributing Partner the same subscription rights that Contributing Partner
would be entitled to if Contributing Partner
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had exercised its Redemption Rights in full and received the Share Purchase
Price in satisfaction thereof prior to such grant.
(c) Upon the occurrence of a Major Transaction Event where at least
one-half of the value (as determined in good faith by the General Partner) of
the consideration received by the stockholders of the General Partner in
connection with such Major Transaction Event is in the form of securities in a
successor entity, the General Partner shall cause effective provision to be
made so that, upon exercise of the Redemption Rights and payment of the
Purchase Price at any time following such Major Transaction Event by means of
the Share Purchase Price, Unitholders shall have the right to acquire, in lieu
of the Shares which would have been surrendered therefor, the kind and amount
of shares of stock and other securities and property (and the provisions
contained in Section 4.1 shall apply anew to the extent that such securities
are of a class of securities of the General Partner or its successor that are
registered under the Exchange Act) and interests as would be issued or payable
with respect to or in exchange for the number of Shares constituting the Share
Purchase Price as if such Redemption Rights had been exercised and the General
Partner had satisfied the Redemption Rights by delivery of the Share Purchase
Price immediately before such Major Transaction Event.
(d) In the event of any other Major Transaction Event, each
Unitholder shall be entitled to exercise the Redemption Rights in full prior to
the consummation of such Major Transaction Event, and, with respect to any
Shares acquired upon exercise thereof, shall be entitled to all of the rights
of the other holders of Shares with respect to any distribution by the General
Partner (or the other party to such Major Transaction Event) in connection with
such Major Transaction Event. If not exercised within forty-five days after
written notice from the General Partner of such Major Transaction Event or such
shorter period between the date of such notice and the effective date of such
Major Transaction Event, the Redemption Rights shall terminate at the
expiration of such period, but the Redemption Rights shall be revived if such
Major Transaction Event is not consummated.
(e) The Partnership shall give written notice of any Major
Transaction Event promptly after such Major Transaction is announced to the
public.
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(f) The provisions of this Section 6 shall apply to successive events
that may occur from time to time but only shall apply to a particular event if
it occurs prior to the exercise in full of the Redemption Rights or the
liquidation of the Partnership. Nothing contained herein shall prevent or
otherwise limit the liquidation of the Partnership pursuant to the Partnership
Agreement, as amended from time to time.
(g) Whenever the Conversion Factor is adjusted as herein provided,
the General Partner shall compute the adjusted Conversion Factor in accordance
with Section 6 and shall prepare a certificate signed by the chief financial
officer of the General Partner setting forth the adjusted Conversion Factor and
showing in reasonable detail the facts upon which such adjustment is based, and
such certificate shall forthwith be filed at the offices of the General
Partner.
7. Purchase Right.
7.1 Purchase Right. In the event that the General Partner in good
faith determines at any time that the continued ownership of Units by the
holder of such Units would cause amounts which would otherwise be characterized
as "rents from real property" (within the meaning of Section 856(d)(1) of the
Code) to fail to be so characterized as the result of the ownership or deemed
ownership of any Retailer Interest, the holder of such Units shall dispose of
such Retailer Interest within five Business Days of written notice from the
Partnership. In the absence of such a disposition, the General Partner shall
have the right, but not the obligation (the "Purchase Right"), to purchase all
of the Units then held by such holder upon the terms and subject to the
conditions contained in this Section 7.
7.2 Method of Exercise. The Purchase Right shall be exercised by
written notice to the holder of the Units to be purchased specifying that the
General Partner has elected to purchase such Units pursuant to Section 7 of
this Agreement.
7.3 Purchase Price. The purchase price for such Units shall be the
Cash Purchase Price with respect to such Units.
7.4 Closing. The closing of any purchase and sale pursuant to this
Section 7 shall occur at the time specified in the notice described in Section
7.2 but in no event later than 30 days after the giving of such notice. At the
closing, the General Partner
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shall deliver to the selling Unitholder the Cash Purchase Price in immediately
available funds, and the selling Unitholder shall deliver to the General
Partner an instrument of transfer in form sufficient to transfer the Units to
be transferred, free and clear of all Liens, and containing the representations
and warranties set forth in Exhibit A.
7.5 Notice of Certain Events. Contributing Partner promptly shall
provide to the Partnership a written statement describing the acquisition by
it or its partners or Affiliates of any equity interest in a retailer or other
person or entity which is or could be a potential tenant of the Partnership or
of any Other REIT (a "Retailer Interest"), and Contributing Partner represents
and warrants that neither Contributing Partner nor any of its partners or
Affiliates currently owns any such Retailer Interest.
8. Miscellaneous Provisions.
8.1 Notices. All notices or other communications given pursuant to
this Agreement shall be sent to the party to whom or to which such notice is
being sent, by certified or registered mail, return receipt requested,
commercial overnight delivery service, facsimile or delivered by hand with
receipt acknowledged in writing. All notices (a) shall be deemed given when
received or, if mailed as described above, after 5 Business Days or, if sent by
facsimile, upon receipt of confirmed answerback and (b) may be given either by
a party or by such party's attorneys. For purposes of this Section 8.1, the
addresses of the parties shall be, in the case of the Partnership and the
General Partner, 00 Xxxx Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000,
facsimile number (000) 000-0000, Attention: Xxxxxxx Xxxxxxxxx and Xxxxxxx
Xxxxxxxx, and, in the case of Contributing Partner, as set forth on the records
of the Partnership. The address of any party may be changed by a notice in
writing given in accordance with the provisions hereof.
8.2 Assignment. The rights of Contributing Partner hereunder
(including the Redemption Rights) shall automatically devolve upon any Person
to the extent that such Person holds Units, and becomes a substituted partner
with respect to such Units, in accordance with the Partnership Agreement, as
amended from time to time, and delivers to the Partnership a written
instrument, in form reasonably satisfactory to the Partnership, pursuant to
which such Person agrees to be bound by the terms
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hereof (but the rights of Contributing Partner hereunder are not otherwise
assignable). Subject to the provisions of Section 6, the General Partner may
assign this Agreement without the consent of Contributing Partner, provided
that no such assignment shall relieve the General Partner of its obligations
under this Agreement.
8.3 Binding Effect. This Agreement shall be binding upon, and inure
to the benefit of, the parties and their successors and permitted assigns.
8.4 Governing Law. This Agreement shall be governed by the laws of
the State of Delaware (without regard to its conflicts of law principles).
8.5 Counterparts. This Agreement may be executed in counterparts,
each of which shall be an original, but all of which shall constitute one
document.
8.6 Entire Agreement. This Agreement constitutes the entire
agreement among the parties with respect to the subject matter hereof and
supersedes any prior written or oral understandings and/or agreements among
them with respect thereto.
8.7 Pronouns; Headings; Etc. As used herein, all pronouns shall
include the masculine, feminine and neuter, and all terms shall include the
singular and plural thereof wherever the context and facts require such
construction. The headings herein are inserted for convenience of reference
only and are to be ignored in any construction of the provisions hereof. Any
references in this Agreement to a "Section" or "Exhibit" shall refer to a
Section or Exhibit of this Agreement unless otherwise specified.
8.8 Survival. The representations, warranties and covenants
contained herein or made pursuant hereto shall survive the execution and
delivery of this Agreement and the issuance of Shares pursuant hereto.
8.9 Further Assurances. Each of the parties shall hereafter execute
and deliver such other instruments and documents and do such further acts and
things as may be required or useful to carry out the purposes of this
Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the
date first above written.
CONTRIBUTING PARTNER:
CA SOUTHLAKE INVESTORS, LTD., a
Georgia limited partnership
By: /s/ Xxxxxx Rather
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Its General Partner
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PARTNERSHIP:
GGP LIMITED PARTNERSHIP,
a Delaware limited partnership
By: General Growth Properties, Inc.
a Delaware corporation
By: /s/ Xxxx Xxxxx
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Its Vice President
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GENERAL PARTNER:
General Growth Properties, Inc.
a Delaware corporation
By: /s/ Xxxx Xxxxx
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Its Vice President
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