EXHIBIT 2.2
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PURCHASE AGREEMENT
by and among
RODAMCO NORTH AMERICA, N.V.,
WESTFIELD AMERICA LIMITED PARTNERSHIP,
WESTFIELD GROWTH, LP,
SIMON PROPERTY GROUP, L.P.,
HOOSIER ACQUISITION, LLC,
THE XXXXX COMPANY
and
TERRAPIN ACQUISITION LLC
January 12, 2002
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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS................................................................2
SECTION 1.1. Certain Defined Terms....................................................2
SECTION 1.2. Construction............................................................11
ARTICLE II PURCHASE AND SALE; ASSUMPTION OF LIABILITIES..............................11
SECTION 2.1. Purchase and Sale of Assets.............................................11
SECTION 2.2. Purchase Price; Manner of Payment.......................................11
SECTION 2.3. Assumption of Liabilities...............................................12
SECTION 2.4. Closing.................................................................13
SECTION 2.5. Closing Deliveries by Target............................................13
SECTION 2.6. Closing Deliveries by Purchasers........................................14
ARTICLE III REPRESENTATIONS AND WARRANTIES OF TARGET..................................14
SECTION 3.1. Organization, Standing and Corporate Power of Target....................14
SECTION 3.2. Target Subsidiaries.....................................................15
SECTION 3.3. Authority; No Violations; Consents and Approval.........................16
SECTION 3.4. Capital Structure.......................................................17
SECTION 3.5. Financial Statements....................................................18
SECTION 3.6. [INTENTIONALLY OMITTED].................................................19
SECTION 3.7. Absence of Certain Changes or Events....................................19
SECTION 3.8. Environmental Matters...................................................19
SECTION 3.9. Properties..............................................................21
SECTION 3.10. No Undisclosed Material Liabilities.....................................24
SECTION 3.11. No Default..............................................................24
SECTION 3.12. Compliance with Applicable Laws.........................................24
SECTION 3.13. Litigation..............................................................25
SECTION 3.14. Taxes...................................................................25
SECTION 3.15. Pension and Benefit Plans; ERISA........................................27
SECTION 3.16. Labor and Employment Matters............................................31
SECTION 3.17. Contracts...............................................................31
SECTION 3.18. Intangible Property.....................................................32
SECTION 3.19. Insurance...............................................................33
SECTION 3.20. Brokers.................................................................33
SECTION 3.21. Related Party Transactions..............................................33
SECTION 3.22. Opinion of Financial Advisor............................................33
SECTION 3.23. Investment Company Act of 1940..........................................33
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE PURCHASER PARTIES...................34
SECTION 4.1. Organization, Standing and Power........................................34
SECTION 4.2. Authority; No Violations; Consents and Approvals........................34
SECTION 4.3. Available Funds.........................................................35
SECTION 4.4. Brokers.................................................................35
ARTICLE V ADDITIONAL AGREEMENTS.....................................................36
SECTION 5.1. Conduct of Business by Target Prior to the Closing......................36
SECTION 5.2. Tax Related Covenants...................................................40
SECTION 5.3. Access to Information; Confidentiality..................................41
SECTION 5.4. Reasonable Efforts; Notification........................................42
SECTION 5.5. Tax Returns.............................................................43
SECTION 5.6. Section 754 or Other Elections..........................................43
SECTION 5.7. Employee Arrangements...................................................43
SECTION 5.8. No Solicitation of Acquisition Proposals................................45
SECTION 5.9. Public Announcements....................................................46
SECTION 5.10. Agreements Regarding the Disposal of Properties.........................46
SECTION 5.11. Indemnification; Directors' and Officers' Insurance.....................47
SECTION 5.12. Shareholders' Meeting...................................................49
SECTION 5.13. Voting Trust............................................................50
SECTION 5.14. Funding of Purchase Price...............................................50
SECTION 5.15. Officers and Directors..................................................50
SECTION 5.16. Urban Retail Properties.................................................50
ARTICLE VI TAX MATTERS...............................................................50
SECTION 6.1. Assumption of Taxes.....................................................50
SECTION 6.2. Indemnification.........................................................51
SECTION 6.3. Tax Contests............................................................51
SECTION 6.4. Tax Refunds.............................................................51
SECTION 6.5. Withholding Certificates................................................51
ARTICLE VII CONDITIONS TO CLOSING.....................................................51
SECTION 7.1. Conditions to Obligations of Purchasers.................................51
SECTION 7.2. Conditions to Obligations of Target.....................................53
ARTICLE VIII TERMINATION...............................................................54
SECTION 8.1. Termination.............................................................54
SECTION 8.2. Effect Of Termination...................................................56
(ii)
ARTICLE IX GENERAL PROVISIONS........................................................56
SECTION 9.1. Non-Survival Of Representations and Warranties..........................56
SECTION 9.2. Expenses................................................................57
SECTION 9.3. Notices.................................................................60
SECTION 9.4. WAIVER OF JURY TRIAL....................................................62
SECTION 9.5. Headings................................................................62
SECTION 9.6. Severability............................................................62
SECTION 9.7. Assignment..............................................................62
SECTION 9.8. Entire Agreement; No Third-Party Beneficiaries..........................62
SECTION 9.9. Amendment...............................................................63
SECTION 9.10. Governing Law...........................................................63
SECTION 9.11. Counterparts............................................................63
SECTION 9.12. Waiver..................................................................63
SECTION 9.13. Reservation of Rights...................................................63
SECTION 9.14. Enforcement.............................................................63
SECTION 9.15. Exhibits; Disclosure Letter.............................................64
SECTION 9.16. Joint and Several Obligations...........................................64
EXHIBITS
Exhibit A Assets
Exhibit B Xxxxxxxx Letter
Exhibit C Loyens Tax Opinion
(iii)
PURCHASE AGREEMENT
This
PURCHASE AGREEMENT (this "AGREEMENT"), dated as of January 12, 2002,
by and among Rodamco North America, N.V., an investment company with variable
capital, incorporated under the laws of The Netherlands ("TARGET"), Westfield
America Limited Partnership, a Delaware limited partnership ("WALLABY"),
Westfield Growth, LP, a Delaware limited partnership ("WALLABY ACQUISITION
SUB"), Simon Property Group, L.P., a Delaware limited partnership ("HOOSIER"),
Hoosier Acquisition, LLC, a Delaware limited liability company ("HOOSIER
ACQUISITION SUB"), The Xxxxx Company, a Maryland corporation ("TERRAPIN" and,
together with Wallaby and Hoosier, the "PARENT ENTITIES"; the Parent Entities
are sometimes referred to herein individually as the "PARENT ENTITY"), and
Terrapin Acquisition, LLC, a Maryland limited liability company ("TERRAPIN
ACQUISITION SUB" and, together with Wallaby Acquisition Sub and Hoosier
Acquisition Sub, "PURCHASERS"; Purchasers are sometimes referred to herein
individually as "PURCHASER").
RECITALS
A. Target and Purchasers believe that it is in the best interest of
Target, the Purchasers and their respective shareholders, that Purchasers and
Target enter into this Agreement pursuant to which Target will sell to
Purchasers, and Purchasers will purchase from Target, the Assets (as hereinafter
defined) upon the terms and subject to the conditions set forth herein (the
"PURCHASE").
B. Concurrently herewith, Target and Purchasers are entering into the
Protocol, pursuant to which Target will liquidate and distribute to shareholders
of Target the proceeds received by Target from the Purchase in accordance with
the terms thereof (the "DISTRIBUTION") and (ii) Target, Westfield Limited,
Hoosier and Terrapin are entering into a Voting and Support Agreement (the
"VOTING AND SUPPORT AGREEMENT") pursuant to which Westfield Limited, on the
terms and subject to the conditions thereof, has agreed to vote in favor of the
Purchase and the Distribution at an extraordinary general meeting of holders of
Ordinary Shares of Target convened for such purpose.
C. Target will convene a meeting of its shareholders for the purpose of
obtaining the requisite shareholder approval for the Purchase and the other
transactions contemplated hereby.
D. Subject only to the closing of the Purchase and the receipt of the
proceeds of the Purchase by Target, Target shall as soon as legally permissible
and to the maximum extent permitted by Dutch law distribute the proceeds from
the Purchase to the shareholders of Target in accordance with the Protocol.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth in this Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 CERTAIN DEFINED TERMS. As used in this Agreement, the
following terms shall have the following meanings:
"ABBEY PROPERTIES" means the assets and Subsidiaries of Abbey Properties,
LLC, a California limited liability company.
"ACQUISITION PROPOSAL" has the meaning specified in SECTION 5.8.
"ADDITIONAL AMOUNT" has the meaning specified in SECTION 2.2(a).
"AFFILIATE" means, with respect to any specified Person, any other Person
that directly, or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such specified Person.
"AGREEMENT" means this
Purchase Agreement among Target, Purchasers and the
Parent Entities (including the Exhibits and the Schedules hereto) and all
amendments hereto made in accordance with the provisions of SECTION 9.9.
"ANCHOR TENANT LEASE" means any lease or other agreement between a Target
Property Owner and a so-called anchor tenant.
"XXXXXXXX LETTER" has the meaning specified in SECTION 5.2(c).
"ANNUAL ACCOUNTS" means the annual accounts of Target (consisting of a
profit and loss account, balance sheet and explanatory notes thereto and all
other documents and statements thereto) and a consolidated auditors report,
determined in accordance with Dutch GAAP.
"ASSETS" means (i) the properties and assets identified on EXHIBIT A and
(ii) except as otherwise designated by Purchasers prior to Closing, all other
assets, properties and rights of every kind owned by any Target Non-Purchased
Entity (including, without limitation, any equity interests owned directly or
indirectly by Target in any other Target Non-Purchased Entity) known or unknown,
fixed or unfixed, accrued, absolute, contingent or otherwise, whether or not
specifically referred to in this Agreement including, without limitation, the
Target Intangible Property and the Target Tangible Personal Property, other than
the Retained Assets.
"ASSUMED LIABILITIES" has the meaning specified in SECTION 2.3(a).
"ASSUMED TAXES" has the meaning specified in SECTION 6.1.
"ASSUMPTION AGREEMENT" has the meaning specified in SECTION 2.5(c).
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"AUSTRALIAN AMOUNT" means 0.498515% of the amount distributable solely in
respect of the common stock of Hexalon in connection with the liquidation
contemplated by the Protocol, which shall in no event exceed EURO 7,300,000.
"AUSTRALIAN INTERESTS" means the equity interests owned in the companies
listed under such heading on Section 1.1 of the Target Disclosure Letter.
"BI" means an investment institution (Beleggingsinstelling) within the
meaning of Article 28 of the Dutch Corporation Tax Law.
"BOOKS AND RECORDS" means all books and records, including without
limitation, books, archival materials, manuals, price lists, mailing lists,
lists of customers, sales and promotional materials, software, purchasing
materials, personnel records, quality control records and procedures, business
and strategic plans, financial and accounting records, Tax records,
environmental records and litigation files (regardless of the media in which
stored), in each case principally relating to or used by Target or any Target
Subsidiary.
"BREAK-UP EXPENSES" has the meaning specified in SECTION 9.2(d).
"BREAK-UP FEE" has the meaning specified in SECTION 9.2(c).
"BUSINESS DAY" means any day that is not a Saturday, a Sunday or other day
on which banks are required or authorized by Law to be closed in
New York,
New
York or in The Netherlands.
"CERCLA" means the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, 42 U.S.C. Sections 9601 et seq., as amended.
"CLOSING" has the meaning specified in SECTION 2.4.
"CLOSING DATE" has the meaning specified in SECTION 2.4.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMMITMENT" has the meaning specified in SECTION 5.1(b)(iii).
"CONFIDENTIALITY AGREEMENTS" has the meaning specified in SECTION 5.3(a).
"DISPOSAL AGREEMENT" has the meaning specified in SECTION 5.10.
"DISPOSAL PROPERTY" has the meaning specified in SECTION 5.10.
"DISTRIBUTION" has the meaning specified in the Recitals to this Agreement.
"DUTCH GAAP" means Dutch generally accepted accounting principles and
practices in effect from time to time applied consistently throughout the
periods involved.
"DUTCH LAW" means the laws of The Netherlands, including regulations of
Euronext Amsterdam N.V.
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"EC MERGER REGULATIONS" means Counsel regulation (EEC) No. 4064/89 of
December 21, 1989 on the Control of Concentrations Between Undertakings, OJ
(1989) L 395/1 and the regulations and decisions of the Councilor Commission of
the European Community or other organs of the European Union or European
Community implementing such regulations.
"ENCUMBRANCE" means all pledges, claims, liens, charges, restrictions,
controls, encumbrances and security interests of any kind or nature whatsoever.
"ENTERPRISE CHAMBER" means the Enterprise Chamber ("Ondernemingskamer") of
the Amsterdam Court of Appeals.
"ENVIRONMENTAL LAW" means any Law of any Governmental Entity, with
jurisdiction over the Target Subsidiaries, relating to the protection of human
health, natural resources or the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"EURO" means the single currency of participating member states of the
European Monetary Union.
"EUROPEAN COMMISSION" means the Commission of European Communities.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"EXCLUDED LIABILITIES" has the meaning specified in SECTION 2.3(b).
"EXCLUDED TAXES" has the meaning set forth in SECTION 6.1.
"EXISTING TITLE POLICIES" has the meaning specified in SECTION 3.9(a).
"EXPENSE AMOUNT" has the meaning specified in SECTION 9.2(h).
"GOVERNMENTAL ENTITY" means any United States federal, state or local or
any Dutch or other foreign government, governmental, regulatory or
administrative authority, agency or commission or any court, tribunal, or
judicial or arbitral body including, without limitation, the Enterprise Chamber
and the Dutch Central Bank.
"HAZARDOUS MATERIAL" means (i) any petroleum or petroleum products,
radioactive materials, asbestos-containing materials, urea formaldehyde foam
insulation and polychlorinated biphenyls ("PCBS"); (ii) any chemicals,
materials, substances or wastes which are defined as or included in the
definition of "hazardous substances," "hazardous wastes," "hazardous materials,"
"extremely hazardous wastes," "restricted hazardous wastes," "toxic substances,"
"toxic pollutants," "pollutant," "contaminant" or words of similar import, or
regulated as such, under any Environmental Law or for which a person may be
subject to liability under any Environmental Law.
"HEXALON" means Hexalon Real Estate, Inc., a Delaware corporation and a
Target Subsidiary.
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"HOOSIER" has the meaning specified in the introductory paragraph to this
Agreement.
"HOOSIER ACQUISITION SUB" has the meaning specified in the introductory
paragraph to this Agreement.
"HOOSIER CONFIDENTIALITY AGREEMENT" has the meaning specified in
SECTION 5.3(a).
"HSR ACT" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976,
as amended.
"H&T ASSUMED LIABILITIES" has the meaning specified in SECTION 5.11(f).
"H&T ASSUMPTION AGREEMENT" has the meaning specified in SECTION 2.5(d).
"INDEMNIFIED PARTIES" has the meaning specified in SECTION 5.11(a).
"INDEMNIFYING PARTIES" has the meaning specified in SECTION 5.11(a).
"INVASIVE TESTING" has the meaning specified in SECTION 5.3(b).
"INVESTIGATION" has the meaning specified in SECTION 5.3(a).
"IRS" means the United States Internal Revenue Service.
"JOINT VENTURES" means the entities and properties managed or controlled by
the Persons or any Affiliate of such Persons set forth on Schedule 1.1 to the
Target Disclosure Letter.
"JV INTERESTS" has the meaning specified in SECTION 3.4(b).
"KEY EMPLOYEE" means those individuals set forth on Section 5.7 of the
Target Disclosure Letter.
"KNOWLEDGE", or any similar expression, means with respect to Target (or
any Target Subsidiary), the actual knowledge of the persons set forth on
Schedule 1.1 to the Target Disclosure Letter.
"LAW" means any statute, law, regulation, order, interpretation, permit,
license, approval, authorization, rule or ordinance of any Governmental Entity
applicable to the Purchaser Parties or Target or any of their respective
Subsidiaries.
"LEASED PROPERTIES" has the meaning specified in SECTION 3.9(a).
"LOSSES" has the meaning specified in SECTION 5.11(a).
"LOYENS TAX OPINION" has the meaning specified in SECTION 5.2(d).
"MAJORITY ACQUISITION PROPOSAL" has the meaning specified in
SECTION 9.2(b).
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"MATERIAL CONTRACTS" means (i) any loan agreement, indenture, note, bond,
debenture, mortgage or any other document, agreement or instrument evidencing a
capitalized lease obligation or other indebtedness to any Person, other than
indebtedness in a principal amount less than $1,000,000, and (ii) each
commitment, contractual obligation, capital expenditure or transaction entered
into by Target or any Target Subsidiary which may result in total payments by or
liability of Target or any Target Subsidiary in excess of $1,000,000, other than
the Target Ground Leases; PROVIDED, however, any contract, agreement or other
arrangement under clause (ii) above that, by its terms, is terminable within 30
days (without termination fee or penalty) of the date of this Agreement shall
not be deemed to be a Material Contract.
"NECESSARY CONSENTS" has the meaning specified in SECTION 7.1(d).
"NON-COVERED EMPLOYEES" means those employees of Target or of any Target
Subsidiary that are regularly scheduled to work at least 30 hours per week and
that are not party to or otherwise covered by a Target Employment Agreement.
"NON-FINANCIAL COVENANTS" has the meaning specified in SECTION 2.3(b)(iv).
"OAKBROOK CONTRACT" has the meaning specified in SECTION 5.1(a).
"ORDINARY DIVIDEND" has the meaning specified in SECTION 5.1(b)(ii).
"ORDINARY DIVIDEND AMOUNT" means an amount equal to ninety percent (90%) of
the Net Profit as reflected on the Target's audited financial statements for the
ten month period ended December 31, 2001.
"ORDINARY SHARES" means the ordinary shares in the capital of Target, par
value EURO 8 per share.
"OWNED PROPERTIES" has the meaning specified in SECTION 3.9(a).
"PARENT ENTITY" and "PARENT ENTITIES" have the meanings specified in the
introductory paragraph to this Agreement.
"PER SHARE CONSIDERATION" means the quotient of (a) the Purchase Price
MINUS the Australian Amount over (b) 45,092,131 Ordinary Shares.
"PERIMETER MALL" means that certain Target Property generally known as
Perimeter Mall.
"PERMITTED ENCUMBRANCES" has the meaning specified in SECTION 3.9(a).
"PERSON" means an individual, corporation, partnership, limited liability
company, joint venture, association, trust, unincorporated organization or other
entity.
"PERSONAL PROPERTY" has the meaning specified in SECTION 3.9(j).
"PROFORMA TAX RETURNS" has the meaning specified in SECTION 5.2(f).
"PROPERTY AGREEMENTS" has the meaning specified in SECTION 3.9(d).
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"PROTOCOL" means the Distribution and Liquidation Protocol, dated the date
hereof, among Purchasers, the Parent Entities and Target.
"PURCHASE" has the meaning specified in the Recitals to this Agreement.
"PURCHASE PRICE" has the meaning specified in SECTION 2.2(a).
"PURCHASER" and "PURCHASERS" have the meanings specified in the
introductory paragraph to this Agreement.
"PURCHASER DESIGNEE" has the meaning specified in SECTION 2.1.
"PURCHASER PARTIES" shall mean, collectively, the Purchasers and the Parent
Entities.
"PURCHASERS' REPRESENTATIVES" has the meaning specified in SECTION 5.3(a).
"REDUCED BREAK-UP FEE EXPENSES" has the meaning specified in
SECTION 9.2(d).
"REIT" means a real estate investment trust within the meaning of Section
856 of the Code.
"RELEASE" means any past or present release, spilling, leaking, pumping,
pouring, emitting, emptying, discharging, injecting, leaching, dispersing,
migrating, dumping or disposing into the indoor or outdoor environment
(including, without limitation, ambient air, surface water, groundwater, and
surface or subsurface strata) or into or out of any property, including the
movement of Hazardous Material through or into the air, soil, surface water, or
groundwater.
"RENT ROLL" has the meaning specified in SECTION 3.9(i).
"RETAINED ASSETS" means the Purchase Price, any proceeds thereof, any
rights of Target under the Transaction Documents and any equity interests in the
Target Non-Purchased Entities.
"ROPRO ASSETS" means those certain assets owned directly or indirectly by
RoProperty Services BV, a private company with limited liability with its
corporate seat in Rotterdam.
"SAR" has the meaning specified in SECTION 5.7(d).
"SEC" means the United States Securities and Exchange Commission.
"SECTION 754 ELECTION" has the meaning specified in SECTION 5.6.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"745 PROPERTY" means that certain Target Property located at 000 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx.
"SEVERANCE BASE" has the meaning specified in SECTION 5.7(a).
"SEVERANCE PAYMENT" has the meaning specified in SECTION 5.7(a).
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"SHAREHOLDERS MEETING" has the meaning specified in SECTION 5.12(a).
"SPACE LEASE" means any lease or other occupancy agreement affecting a
Target Property.
"SUBSIDIARY" of any Person means any corporation, partnership, limited
liability company, joint venture or other legal entity of which such Person
(either directly or through or together with another Subsidiary of such Person)
(i) owns more than 50% of the voting stock or value of such corporation,
partnership, limited liability company, joint venture or other legal entity, or
(ii) otherwise has the ability to elect a majority of the directors, trustees or
managing members thereof.
"SUPERIOR PROPOSAL" has the meaning specified in SECTION 5.8.
"TARGET" has the meaning specified in the introductory paragraph to this
Agreement.
"TARGET DISCLOSURE LETTER" means the disclosure letter dated as of the date
of this Agreement and delivered to Purchasers in connection with the execution
hereof.
"TARGET EMPLOYEE BENEFIT PLANS" has the meaning specified in
SECTION 3.15(c) and are listed in Section 3.15 of Target Disclosure Letter.
"TARGET EMPLOYMENT AGREEMENTS" has the meaning specified in
SECTION 3.15(r).
"TARGET ERISA AFFILIATE" has the meaning specified in SECTION 3.15(a).
"TARGET FILINGS" means the most recent Annual Report and Semi-Annual Report
filed or published by Target with the Chamber of Commerce of Rotterdam prior to
the date hereof.
"TARGET FINANCIAL ADVISOR" means X.X. Xxxxxx Securities Inc.
"TARGET GROUND LEASES" has the meaning specified in SECTION 3.9(a).
"TARGET INTANGIBLE PROPERTY" has the meaning specified in SECTION 3.18.
"TARGET MATERIAL ADVERSE EFFECT" means a material adverse effect on the
business, properties, liabilities, financial condition or results of operations
of Target and the Target Subsidiaries, taken as a whole, excluding the effect of
(i) general changes in the economy or financial markets of the United States or
any other region outside of the United States, (ii) changes in Law that affect
real estate investment trusts generally, unless such changes have a materially
disproportionate effect, relative to other industry participants, on Target and
the Target Subsidiaries, taken as a whole, and (iii) changes that affect the
retail industry or retail real estate properties generally, unless such changes
have a materially disproportionate effect, relative to other industry
participants, on Target and the Target Subsidiaries, taken as a whole.
"TARGET MINIMUM AMOUNT" has the meaning specified in SECTION 8.1(k).
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"TARGET NON-PURCHASED ENTITIES" means Target and the Target Subsidiaries
which are not to be purchased by Purchasers pursuant to this Agreement and which
are set forth on Schedule 1.1 to the Target Disclosure Letter.
"TARGET NON-SUBSIDIARY ENTITY" means any Person in which Target or any
Target Subsidiary owns, directly or indirectly, any equity or similar interests,
or any interest convertible into or exchangeable or exercisable for any equity
or similar interests, other than a Target Subsidiary, the Joint Ventures and any
publicly traded entity in which Target or any Target Subsidiary beneficially
owns less than one percent (1%) of any class or securities of such entity.
"TARGET ORGANIZATIONAL DOCUMENTS" has the meaning specified in SECTION 3.1.
"TARGET PENSION PLANS" has the meaning specified in SECTION 3.15(a).
"TARGET PERMITS" has the meaning specified in SECTION 3.12.
"TARGET PROPERTIES" has the meaning specified in SECTION 3.9(a).
"TARGET PROPERTY OWNER" means, each Target Subsidiary and any other entity,
other than the Joint Ventures, which directly owns any Target Property.
"TARGET PROPERTY RESTRICTIONS" has the meaning specified in SECTION 3.9(b).
"TARGET PURCHASED SUBSIDIARIES" means the Subsidiaries of Target which are
to be purchased by Purchasers pursuant to this Agreement.
"TARGET REPRESENTATIVES" has the meaning specified in SECTION 5.8.
"TARGET SHAREHOLDER APPROVAL" means has the meaning specified in
SECTION 7.1(a).
"TARGET SUBSIDIARIES" means all of the Subsidiaries of Target.
"TARGET TANGIBLE PERSONAL PROPERTY" means all of the tangible property
owned or leased by a Target Property Owner in, on, attached to, appurtenant to,
or used in the operation or maintenance of, a Target Property, including,
without limitation, any and all appliances, furniture, carpeting, draperies,
curtains, tools and supplies, plans, specifications and drawings for such Target
Property and Personal Property.
"TAX" or "TAXES" means any and all taxes, fees, levies, duties, tariffs,
imposts, and other charges of any kind (together with any and all interest,
penalties, additions to tax and additional amounts imposed with respect thereto)
imposed by any foreign, U.S., state and local government or taxing authority,
including, without limitation: taxes or other charges on or with respect to
income, alternative minimum tax, franchises, windfall or other profits, gross
receipts, excess distributions, impositions, property, sales, use, capital
stock, payroll, employment, social security, workers' compensation, unemployment
compensation, or net worth; taxes or other charges in the nature of excise,
surtax, tax imposed under Article IV. B. Invoeringswet Inkomstenbelasting 2001,
withholding, ad valorem, stamp, transfer, mortgage recording, value
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added, or gains taxes; license, registration and documentation fees; and
customs' duties, tariffs, and similar charges.
"TAX RETURN" means any return, declaration, report, claim for refund, or
information return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.
"TERMINATING PURCHASERS BREACH" has the meaning specified in
SECTION 8.1(f).
"TERMINATING TARGET BREACH" has the meaning specified in SECTION 8.1(e).
"TERMINATION DATE" has the meaning specified in SECTION 8.1(j).
"TERRAPIN" has the meaning specified in the introductory paragraph to this
Agreement.
"TERRAPIN ACQUISITION SUB" has the meaning specified in the introductory
paragraph to this Agreement.
"THIRD PARTY" means any Person other than Purchasers and their respective
Affiliates.
"TRANSACTION DOCUMENTS" has the meaning specified in SECTION 3.3(a).
"TRANSFER AND GAINS TAXES" means any real property transfer or gains,
sales, use, transfer, mortgage recording, intangible, value added, stock
transfer and stamp Taxes, any transfer, recording, registration and other fees
and any similar Taxes which become payable in connection with the transactions
contemplated by this Agreement, together, with any related interests, penalties
or additions to Tax.
"TRIGGERED LOANS" means those loans identified as "Triggered Loans" in
SECTION 3.3 of the Target Disclosure Letter.
"2001 INCENTIVE PROGRAM" has the meaning specified in SECTION 5.7(d).
"2001 SAR PLAN" has the meaning specified in SECTION 5.7(d).
"UNITED STATES GAAP" means United States generally accepted accounting
principles and practices in effect from time to time applied consistently
throughout the periods involved.
"URBAN TAX INDEMNIFICATION AGREEMENT" means that certain Tax
Indemnification and Contest Agreement, dated as of November 8, 2000, among Urban
Shopping Centers, L.P., Head Acquisition, L.P., Hexalon Real Estate, Inc. and
the holders of Class A Common Units of Urban Shopping Centers, L.P. signatory
thereto.
"VOTING DEBT" shall mean bonds, debentures, notes or other indebtedness
having the right to vote (or convertible into, or exchangeable for, securities
having the right to vote) on any matters on which holders of equity interests in
Target, any Target Subsidiary or Purchasers, as applicable, may vote.
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"VOTING AND SUPPORT AGREEMENT" has the meaning specified in the Recitals to
this Agreement.
"VOTING TRUST" means Stichting RNA, a non-profit foundation having its
registered seat in Rotterdam.
"VOTING TRUST REDEMPTION" means the purchase from the Voting Trust of all
of its shares of Target issued to the Voting Trust pursuant to the Agreement
Regarding the Acquisition of Shares in Target, dated September 23, 2001, between
Target and the Voting Trust, as in effect as of the date hereof.
"WALLABY" has the meaning specified in the introductory paragraph to this
Agreement.
"WALLABY ACQUISITION SUB" has the meaning specified in the introductory
paragraph to this Agreement.
"WARN" has the meaning specified in SECTION 5.7(a).
"WESTFIELD DESIGNEE" has the meaning specified in SECTION 5.12(a).
SECTION 1.2. CONSTRUCTION. The words "herein," "hereof" and "hereunder"
and other words of similar import refer to this Agreement as a whole, including
all exhibits and schedules, as the same may from time to time be amended,
restated, modified or supplemented, and not to any particular section,
subsection or clause contained in the Agreement or any such exhibit or schedule.
Wherever from the context it appears appropriate, each term stated in either the
singular or plural shall include the singular and the plural, and pronouns
stated in the masculine, feminine and neuter genders shall include the
masculine, feminine and neuter genders. The words "including", "includes" and
"include" shall be deemed to be followed by the words "without limitation".
ARTICLE II
PURCHASE AND SALE; ASSUMPTION OF LIABILITIES
SECTION 2.1. PURCHASE AND SALE OF ASSETS. On the terms and subject to the
conditions set forth in this Agreement, Target shall (or shall cause the
appropriate Target Subsidiary or Affiliate of Target or Target Subsidiary, as
directed by Purchasers to), at the Closing, sell, assign, transfer, convey and
deliver to Purchasers (or to one or more designees of Purchasers designated by
Purchasers), and Purchasers (or to one or more designees of Purchasers
designated by Purchasers (each a "PURCHASER DESIGNEE")) shall purchase, from
Target (or the appropriate Target Subsidiary or Affiliate of Target or Target
Subsidiary, as directed by Purchasers), on the Closing Date, the Assets.
SECTION 2.2. PURCHASE PRICE; MANNER OF PAYMENT.
(a) The aggregate purchase price (the "PURCHASE PRICE") for the
Assets shall be the cash sum of EURO 2,480,067,205 LESS the full amount of any
distributions declared and paid or payable to Target's shareholders after the
date hereof and prior to the Closing (including the
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Ordinary Dividend) PLUS the Australian Amount PLUS the Additional Amount (as
hereinafter defined). "ADDITIONAL Amount" means an amount in Euros equal to, if
the Closing occurs on or after May 16, 2002, the product of (x) EURO622,642
TIMES (y) the number of days from and after May 1, 2002 until the Closing Date.
The Australian Amount shall be paid to Target in respect of the Australian
Interests or such other Assets as Purchasers designate (other than Assets owned
directly or indirectly by Hexalon).
(b) At the Closing, Purchasers shall pay to the applicable sellers
of assets owned by Target or Target Subsidiaries their respective shares of the
Purchase Price (as reflected in the final Pro Forma Tax Returns) by wire
transfer in immediately available funds, to an account or accounts designated at
least two (2) Business Days prior to the Closing Date by Target in a written
notice to Purchasers.
(c) The Purchase Price shall be denominated in EUROs and shall not
be subject to any adjustment based on currency fluctuations.
SECTION 2.3. ASSUMPTION OF LIABILITIES.
(a) On the terms and subject to the conditions set forth in this
Agreement, at the Closing, Purchasers and the Purchaser Designees shall assume,
and thereafter pay and fully satisfy and perform when due in accordance with
their respective terms, all liabilities and obligations of the Target
Non-Purchased Entities, whether known or unknown, contingent or otherwise and
whether arising or relating to any act or omission occurring before, on or after
the Closing Date, other than the Excluded Liabilities and the H&T Assumed
Liabilities (such liabilities being referred to herein collectively as the
"ASSUMED LIABILITIES"), including without limitation, the following:
(i) all obligations and liabilities of Target or any Target
Subsidiary to indemnify and to maintain directors' and officers' liability
insurance with respect to the directors, officers, employees, fiduciaries
and agents of Urban Shopping Centers, Inc. and Urban Shopping Centers, L.P.
to the extent required by Section 6.8 of that certain Agreement and Plan of
Merger dated as of September 25, 2000, by and among Target, Hexalon, Head
Acquisition, L.P., Head Acquisition, Corp., Urban Shopping Centers, Inc.
and Urban Shopping Centers, L.P.;
(ii) all obligations and liabilities of Hexalon, Urban Shopping
Centers, L.P. and Head Acquisition, L.P. pursuant to the Urban Tax
Indemnification Agreement; and
(iii) all obligations and liabilities in respect of Assumed Taxes
in accordance with ARTICLE VI hereof.
(b) Notwithstanding the foregoing, Purchasers, the Purchaser
Designees and the Parent Entities shall not assume or be bound by any of the
following liabilities or obligations of Target or any of the Target
Non-Purchased Entities (the "EXCLUDED LIABILITIES"):
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(i) except as provided in Section 2.3(b)(ii), liabilities that
arise after the Closing Date in respect of (A) any operations or activities
of any Target Non-Purchased Entity that occur after the Closing Date or (B)
any Retained Assets;
(ii) liabilities that arise from any act or omission of any
agent, officer, managing or supervisory director or employee of Target or
any Target Non-Purchased Entity that occurs after the Closing Date, other
than liabilities (other than Excluded Taxes) that arise out of the good
faith actions of any agent, officer, employee or managing or supervisory
director of any Target Non-Purchased Entity taken, and reasonably necessary
to effect the distribution of the Purchase Price to Target's shareholders
in accordance with the terms and conditions of the Protocol;
(iii) all obligations and liabilities in respect of Excluded
Taxes; and
(iv) (A) Sections 4.5(d) and 7.5 of the Third Amended and
Restated Agreement of Limited Partnership of Urban Shopping Centers, L.P.
and the related undertakings by Hexalon and Target, (B) Section 10.1 of the
Amended and Restated General Partnership Agreement of KI-Kravco Associates,
by and among Kravco, Inc. and XXX Xxxxxx XX, Xxx., xxxxx Xxxxxxxx 00, 0000;
and Section 10.1 of the Third Amended and Restated General Partnership
Agreement of Kravco Company, by and among Kravco, Inc. and RNA- Kravco III,
Inc., dated November 12, 1998 and (C) any other covenants restricting the
ability of any Target Non-Purchased Entity from conducting business in any
manner or location (clauses (A), (B) and (C) collectively, the
"NON-FINANCIAL COVENANTS").
SECTION 2.4. CLOSING. Subject to the terms and conditions of this
Agreement, the purchase and sale of the Assets shall take place at a closing
(the "CLOSING") to be held at the offices of Xxxxxxx Xxxx & Xxxxxxxxx, 000
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx at 10:00 A.M. eastern time on the date which
is two (2) Business Days after the date on which the conditions set forth herein
with respect thereto shall be satisfied or duly waived, or at such other place
or at such other time or on such other date as Target and Purchasers may
mutually agree upon in writing (the day on which the Closing takes place being
the "CLOSING DATE").
SECTION 2.5. CLOSING DELIVERIES BY TARGET. At the Closing, Target shall
deliver or cause to be delivered to Purchasers or their designees:
(a) With respect to the Assets that are capital stock, stock
certificates evidencing the same duly endorsed in blank, or accompanied by stock
powers duly executed in blank, in form and substance satisfactory to Purchasers;
(b) With respect to Assets other than capital stock, a xxxx of sale,
such deeds and any other documents as are necessary to effect the transfer of
such Assets to Purchasers (or to Purchaser Designees) in a manner and in form
and substance satisfactory to Purchasers;
(c) an assumption agreement effecting Purchasers' and the Purchaser
Designees' assumption of the Assumed Liabilities in form and substance
satisfactory to Target (the "ASSUMPTION AGREEMENT");
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(d) an assumption agreement effecting Hoosier and Terrapin's
assumption of the H&T Assumed Liabilities in form and substance satisfactory to
Target (the "H&T ASSUMPTION AGREEMENT");
(e) the Necessary Consents required to be delivered pursuant to
SECTION 7.1(d); and
(f) the Books and Records.
SECTION 2.6. CLOSING DELIVERIES BY PURCHASERS. At the Closing, Purchasers
shall deliver or cause to be delivered to Target:
(a) the Purchase Price in the manner and denomination described in
SECTION 2.2;
(b) the Assumption Agreement; and
(c) the H&T Assumption Agreement.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF TARGET
As an inducement to the Purchaser Parties to enter into this Agreement,
Target hereby represents and warrants to the Purchaser Parties as follows
(PROVIDED, that for purposes of Article III only, each Target Non-Subsidiary
Entity shall be deemed to be a Target Subsidiary except that each representation
and warranty as to such Target Non-Subsidiary Entity shall only be made to the
Knowledge of Target; PROVIDED, FURTHER, that notwithstanding anything herein to
the contrary, Target does not make any representations and warranties regarding
the Joint Ventures other than in Section 3.4(b) and Section 3.10 as to the
ownership of the JV Interests):
SECTION 3.1. ORGANIZATION, STANDING AND CORPORATE POWER OF TARGET. Target
is a corporation duly incorporated and validly existing under Dutch Law and has
the requisite corporate power, authority and all necessary government approvals
or licenses to own, lease and operate its properties and to carry on its
business as now being conducted. Target is duly qualified or licensed to do
business and is in good standing in each jurisdiction in which the nature of the
business it is conducting, or the ownership, operation or leasing of its
properties or the management of properties for others makes such qualification
or licensing necessary, other than in such jurisdictions where the failure to be
so qualified or licensed, individually or in the aggregate, would not reasonably
be expected to have a Target Material Adverse Effect. Target has heretofore made
available to Purchasers complete and correct copies of Target's articles of
association (the "TARGET ORGANIZATIONAL DOCUMENTS"). The Target Organizational
Documents are in full force and effect as of the date hereof. Each jurisdiction
in which Target is qualified or licensed to do business is identified in Section
3.1 of the Target Disclosure Letter.
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SECTION 3.2. TARGET SUBSIDIARIES.
(a) Each Target Subsidiary that is a corporation is duly
incorporated, validly existing and, where applicable, in good standing under the
Laws of its jurisdiction of incorporation and has the requisite corporate power,
authority and all necessary government approvals and licenses to own, lease and
operate its properties and to carry on its business as now being conducted,
except where the failure to have such approvals or licenses, individually or in
the aggregate, would not reasonably be expected to have a Target Material
Adverse Effect. All outstanding shares of stock of each Target Subsidiary that
is a corporation have been duly authorized, are validly issued, fully paid and
nonassessable, and are not subject to any rights of first offer, rights of first
refusal, tag-along rights or any other preemptive rights and are owned by Target
and/or another Target Subsidiary and, except as disclosed in Section 3.2(a) of
the Target Disclosure Letter, are so owned free and clear of all Encumbrances.
(b) Each Target Subsidiary that is a partnership, limited liability
company or trust is duly organized, validly existing and, where applicable, in
good standing under the Laws of its jurisdiction of organization and has the
requisite power, authority and all necessary government approvals and licenses
to own, lease and operate its properties and to carry on its business as now
being conducted, except where the failure to have such approvals or licenses,
individually or in the aggregate, would not reasonably be expected to have a
Target Material Adverse Effect. All equity interests in each Target Subsidiary
that is a partnership, limited liability company, trust or other entity have
been duly authorized and are validly issued and are owned by Target and/or
another Target Subsidiary and, except as disclosed in Section 3.2(b) of the
Target Disclosure Letter, are so owned free and clear of all Encumbrances.
(c) Each Target Subsidiary is duly qualified or licensed to do
business and is, where applicable, in good standing in each jurisdiction in
which the nature of its business or the ownership, operation or leasing of its
properties or the management of properties for others makes such qualification
or licensing necessary, other than in such jurisdictions where the failure to be
so qualified or licensed, individually or in the aggregate, would not reasonably
be expected to have a Target Material Adverse Effect.
(d) Except as set forth in Section 3.2(d) of the Target Disclosure
Letter, there are no outstanding options, warrants or other rights to acquire
ownership interests from any Target Subsidiary. Target has heretofore made
available to Purchasers complete and correct copies of the charter, by-laws,
partnership agreements, operating agreements or other organizational documents
of each of the Target Subsidiaries, each as amended to date, and each such
instrument or agreement is in full force and effect as of the date hereof.
Section 3.2(d) of the Target Disclosure Letter sets forth (i) all Target
Subsidiaries and their respective jurisdictions of incorporation or
organization, (ii) each owner and the respective amount of such owner's equity
interest in each Target Subsidiary and (iii) a list of each jurisdiction in
which each Target Subsidiary is qualified or licensed to do business and each
assumed name under which each such Target Subsidiary conducts business in any
jurisdiction. Except as set forth in Section 3.2(d) of the Target Disclosure
Letter, Target does not directly or indirectly own any equity or similar
interests in any other Person, or any interest convertible into or exchangeable
or exercisable for any equity or similar interests in any other Person.
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SECTION 3.3. AUTHORITY; NO VIOLATIONS; CONSENTS AND APPROVAL.
(a) Target has all requisite corporate power and authority to enter
into this Agreement and all other documents to be executed by Target in
connection with the transactions contemplated hereby, and by the Protocol and by
the Voting and Support Agreement (collectively, the "TRANSACTION DOCUMENTS") and
to consummate the transactions contemplated hereby and thereby, subject, solely
with respect to the consummation of the Purchase and the Distribution, to
receipt of the Target Shareholder Approval. Each Target Subsidiary that is a
party to any Transaction Document has all requisite power and authority to enter
into such Transaction Document and to consummate the transactions contemplated
thereby. The execution and delivery of the Transaction Documents and the
consummation of the transactions contemplated hereby or thereby have been duly
authorized by all necessary action on the part of Target and each applicable
Target Subsidiary, subject, solely with respect to the consummation of the
Purchase, to receipt of the Target Shareholder Approval. The Transaction
Documents have been duly executed and delivered by Target and each applicable
Target Subsidiary and constitute legal, valid and binding obligations of Target
and each applicable Target Subsidiary, enforceable against Target and each
Target Subsidiary in accordance with their terms, except as such enforceability
may be limited by bankruptcy, insolvency, reorganization, moratorium and other
Laws of general applicability relating to or affecting creditors' rights and by
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at Law).
(b) Except as set forth in Section 3.3(b) of the Target Disclosure
Letter, the execution and delivery of the Transaction Documents by Target and
each applicable Target Subsidiary do not, and the consummation of the
transactions contemplated hereby or thereby, and compliance with the provisions
hereof or thereof, will not, conflict with, or result in any violation of, or
default (with or without notice or lapse of time, or both) under, or give rise
to a right of termination, cancellation or acceleration of any material
obligation, or the loss of a material benefit under, or give rise to a right of
purchase, first offer or forced sale, under, result in the creation of any
Encumbrance upon any of the properties or assets of Target or any of the Target
Subsidiaries under, require the consent or approval of any third party or
otherwise result in a material detriment or default to Target or any of the
Target Subsidiaries under, any provision of (i) the Target Organizational
Documents or any provision of the comparable charter or organizational documents
(including any operating agreement or limited partnership agreement) of any
Target Subsidiary, (ii) any loan or credit agreement or note, except for the
Triggered Loans or any bond, mortgage, indenture, lease or other agreement,
instrument, permit, concession, franchise or license applicable to Target or any
Target Subsidiary, or their respective properties or assets or any guarantee by
Target or any Target Subsidiary of any of the foregoing, (iii) any joint venture
or other ownership arrangement or any Material Contract or (iv) assuming the
consents, approvals, authorizations or permits and filings or notifications
referred to in SECTION 3.3(c) are duly and timely obtained or made and the
Target Shareholder Approval has been obtained, any judgment, order, decree,
statute, Law, ordinance, rule or regulation applicable to Target or any Target
Subsidiary, or any of their respective properties or assets, other than, in the
case of clauses (ii) and (iii), any such conflicts, violations, defaults,
rights, Encumbrances or detriments that, individually or in the aggregate, would
not reasonably be expected to have a Target Material Adverse Effect.
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(c) Except as set forth in Section 3.3(c) of the Target Disclosure
Letter, no consent, approval, order or authorization of, or registration,
declaration or filing with, or permit from, any Governmental Entity, is required
by or on behalf of Target or any of the Target Subsidiaries in connection with
the execution and delivery of the Transaction Documents by Target and each of
the applicable Target Subsidiaries or the consummation by Target or the
applicable Target Subsidiaries of the transactions contemplated hereby or
thereby, except for: (i) the filings, approvals, consents and confirmations
expressly contemplated by the Protocol; (ii) such filings and approvals as may
be required by any applicable Environmental Laws as more specifically described
in Section 3.3 of the Target Disclosure Letter; (iii) the filing, if applicable,
of a pre-merger notification and report by Target under the HSR Act, and the
expiration or termination of the applicable waiting period thereunder; and
(iv) any such consent, approval, order, authorization, registration,
declaration, filing or permit that the failure to obtain or make individually or
in the aggregate, would not reasonably be expected to have a Target Material
Adverse Effect.
SECTION 3.4. CAPITAL STRUCTURE.
(a) The authorized capital of Target consists of 219,656,590
Ordinary Shares, of which 14,700,000 Ordinary Shares are held by the Voting
Trust and 45,092,131 Ordinary Shares are held by other holders and are issued
and outstanding.
(b) Except as set forth in Section 3.4(b) of the Target Disclosure
Letter, Target or the applicable Target Subsidiary owns all Assets (including
the equity interests in the Joint Ventures (the "JV INTERESTS")), free and clear
of any Encumbrance, preemptive rights, call rights, assessments or other adverse
interest of any kind or nature whatsoever; PROVIDED, HOWEVER, that no
representation under this Section 3.4(b) is made with respect to the 745
Property or Perimeter Mall.
(c) Except as set forth in Sections 3.4(a) hereof or in
Section 3.4(c) of the Target Disclosure Letter, there are issued and outstanding
or reserved for issuance: (i) no Ordinary Shares, shares of stock, Voting Debt
or other voting securities of Target; (ii) no restricted shares of Target or any
Target Subsidiary, performance share awards or dividend equivalent rights
relating to the equity interests of Target or any Target Subsidiary, (iii) no
securities of Target or any Target Subsidiary or securities or assets of any
other entity convertible into or exchangeable for Ordinary Shares, shares of
stock, Voting Debt or other voting securities of Target or any Target
Subsidiary; and (iv) no subscriptions, options, warrants, conversion rights,
stock appreciation rights, calls, claims, rights of first refusal, rights
(including preemptive rights), commitments, arrangements or agreements to which
Target or any Target Subsidiary is a party or by which it is bound in any case
obligating Target or any Target Subsidiary to issue, deliver, sell, purchase,
redeem or acquire, or cause to be issued, delivered, sold, purchased, redeemed
or acquired, additional Ordinary Shares, shares of stock, Voting Debt or other
voting securities of Target or of any Target Subsidiary, or obligating Target or
any Target Subsidiary to grant, extend or enter into any such subscription,
option, warrant, conversion right, stock appreciation right, call, right,
commitment, arrangement or agreement. All outstanding Ordinary Shares and other
shares of stock of Target and each Target Subsidiary are, and all shares
reserved for issuance will be, upon issuance in accordance with the terms
specified in the instruments or agreements pursuant to which they are issuable,
duly authorized,
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validly issued, fully paid and nonassessable and not subject to or issued in
violation of, any preemptive right, purchase option, call option, right of first
refusal, subscription or any other similar right.
(d) Except as set forth in Section 3.4(d) of the Target Disclosure
Letter, all dividends or distributions on securities of Target or any Target
Subsidiary that have been declared or authorized prior to the date of this
Agreement have been paid in full.
(e) Except for the Transaction Documents and except as set forth in
Section 3.4(e) of the Target Disclosure Letter, there are not any (i)
stockholder agreements, voting trusts, proxies or other agreements or
understandings relating to the voting of any shares of stock of Target or
(ii) agreements or understandings relating to the sale or transfer (including
agreements imposing transfer restrictions) of any Ordinary Shares of Target or
any ownership interests in any Target Subsidiary, to which Target or any Target
Subsidiary is a party or by which it is bound. Except as set forth in
Section 3.4(e) of the Target Disclosure Letter, there are no restrictions on
Target's ability to vote the equity interests of any of the Target Subsidiaries.
(f) Except as set forth in Section 3.4(f) of the Target Disclosure
Letter, no holder of securities in Target or any Target Subsidiary has any right
to have such securities registered by Target or any Target Subsidiary, as the
case may be.
(g) Except as set forth in Section 3.4(g) of the Target Disclosure
Letter, there are not any Target Subsidiaries in which any officer or director
of Target or any Target Subsidiary owns any stock or other securities. There are
no agreements or understandings between Target or any Target Subsidiary and any
Person that could cause such Person to be treated as holding any stock or
security in Target or any Target Subsidiary as an agent for, or nominee of,
Target or any Target Subsidiary.
(h) Other than equity interests in the Target Non-Purchased
Entities, Target does not directly hold any equity interests in any Person which
is not listed on EXHIBIT A hereto.
SECTION 3.5. FINANCIAL STATEMENTS.
The audited consolidated balance sheet of Target and its Subsidiaries as of
February 28, 2001, the unaudited balance sheet of the Target and its
Subsidiaries as of August 31, 2001 and the audited balance sheet of Hexalon as
of December 31, 2000 fairly present the financial position of Target and its
Subsidiaries, and Hexalon, as the case may be, as of the dates thereof, and the
related statements of income, retained earnings and changes in financial
position for the fiscal periods ended on such dates fairly present the results
of operations and changes in financial position of Target and its Subsidiaries
and Hexalon, as the case may be, for the respective periods indicated. All such
financial statements of Target, including the schedules and notes thereto, if
any, were prepared in accordance with Dutch GAAP applied consistently throughout
the periods involved, except that the unaudited financial statements may not be
in accordance with Dutch GAAP because of the absence of footnotes normally
contained therein and are subject to normal year-end adjustments which in the
aggregate will not be material. All such financial statements of Hexalon,
including the schedules and notes thereto, if any, were prepared in accordance
with United States GAAP applied consistently throughout the periods involved,
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except as noted therein and the absence of footnotes normally contained therein
and are subject to normal year-end adjustments which in the aggregate will not
be material.
SECTION 3.6. [INTENTIONALLY OMITTED]
SECTION 3.7. ABSENCE OF CERTAIN CHANGES OR EVENTS. Except as disclosed or
reflected in the Target Filings filed prior to the date of this Agreement or as
disclosed in Section 3.7 of the Target Disclosure Letter, since February 28,
2001, Target and the Target Subsidiaries have conducted their business only in
the ordinary course and there has not been:
(a) any declaration, setting aside or payment of any dividend or
other distribution (whether in cash, stock or property) with respect to any of
Target's ordinary shares;
(b) any amendment of any term of any outstanding equity security of
Target or any Target Subsidiary;
(c) any repurchase, redemption or other acquisition by Target or any
Target Subsidiary of any outstanding ordinary shares or other equity securities
of, or other ownership interests in, Target or any Target Subsidiary;
(d) any change in any method of accounting or accounting practice or
any material change in any tax method or election by Target or any Target
Subsidiary;
(e) any amendment of any employment, consulting, severance,
incentive stock, deferred compensation, bonus, retirement, retention or any
other agreement between (i) Target or any Target Subsidiary, on the one hand and
(ii) any officer or director of Target or any Target Subsidiary, on the other
hand;
(f) any change, event, effect, damage, destruction or loss relating
to the business or operations of Target or any Target Subsidiary that has had,
or would reasonably be expected to have, a Target Material Adverse Effect; or
(g) any split, combination or reclassification of any of Target's
stock or any issuance or the authorization of any issuance of any other
securities in respect of, in lieu of or in substitution for, or giving the right
to acquire by exchange or exercise, shares of its stock or any issuance of an
ownership interest in, any Target Subsidiary.
SECTION 3.8. ENVIRONMENTAL MATTERS. Except as disclosed in Section 3.8 of
the Target Disclosure Letter and except as would not have a Target Material
Adverse Effect:
(a) No judicial, administrative or compliance order has been issued
that is still in effect, no complaint has been filed that has not been resolved
without further obligation, no penalty has been assessed that has not been paid
and no investigation or review is pending or, to the Knowledge of Target,
threatened by any Governmental Entity with respect to any alleged failure by
Target or any Target Subsidiary to comply with any Environmental Law, including
any alleged failure to have any Target Permit required under any Environmental
Law, or with respect to any treatment, storage, recycling, transportation,
disposal, Release or threatened
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Release by or on behalf of Target or any Target Subsidiary, or on any property
owned, operated or leased by Target or any Target Subsidiary, of any Hazardous
Material;
(b) Neither Target nor any Target Subsidiary nor, to the Knowledge
of Target, any owner or lessee of any property owned, operated or leased by
Target or any Target Subsidiary, has used, generated, stored, treated or handled
any Hazardous Material on such property, except in compliance with Environmental
Laws. In addition: (i) there are no asbestos-containing materials present on, in
or under any property owned, leased or operated by Target or any Target
Subsidiary, (ii) there are no PCBs present on, in or under any property owned,
leased or operated by Target or any Target Subsidiary and (iii) there are no
underground storage tanks, active or abandoned, used for the storage of
Hazardous Materials currently present on, in or under any property owned, leased
or operated by Target or any Target Subsidiary, except in each case where in
compliance with Environmental Laws;
(c) Target and the Target Subsidiaries have not received notice of a
claim, investigation, litigation, proceeding, notice of violation, complaint, or
request for information that has not been resolved without further obligation,
to the effect that it is or may be liable to a third party, including a
Governmental Entity, as a result of a Release or threatened Release of a
Hazardous Material, including exposure to any Hazardous Material, at any
property currently or formerly owned, leased or operated by Target or a Target
Subsidiary, and to the Knowledge of Target, there is no reasonable basis for
such claim, investigation, litigation, proceeding, notice of violation,
complaint, or request for information;
(d) None of Target, any Target Subsidiary and, to the Knowledge of
Target, any Third Party has transported or arranged for the transportation of
any Hazardous Material to any location which is the subject of any action, suit
or proceeding that could be reasonably expected to result in claims against
Target or any Target Subsidiary related to such Hazardous Material for clean-up
costs, remedial work, damages to natural resources or personal injury claims,
including, but not limited to, claims under CERCLA and, to the Knowledge of
Target, there is no reasonable basis for such claim. To the Knowledge of Target,
all Hazardous Material which has been removed from any property owned, leased,
or operated by Target or any Target Subsidiary has been handled, transported and
disposed of in compliance with Environmental Laws and by handlers, transporters
and to facilities maintaining all required permits and licenses;
(e) There are no Encumbrances threatened or attached to any Target
Property arising under or pursuant to any applicable Environmental Law, and no
action of any Governmental Entity has been taken or, to the Knowledge of Target,
is in process which could subject any of such properties to such Encumbrances;
(f) Neither Target nor any Target Subsidiary has entered into any
agreement to provide indemnification to any Third Parties pursuant to
Environmental Laws in relation to any property or facility currently or
previously owned, leased or operated by Target or a Target Subsidiary, other
than indemnity agreements in favor of lenders entered into in connection with
any loan or credit agreements;
(g) Neither Target nor any Target Subsidiary has in its possession
or control or knows of the existence of any environmental assessment or
investigation reports prepared
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within the last four years that have not been provided to Purchasers prior to
the execution of this Agreement;
(h) Each of the Target Properties and operations conducted thereon
is in compliance with all Environmental Laws and Target and all Target
Subsidiaries are in compliance with all Environmental Laws applicable to any of
their owned or leased properties; and
(i) There has been no Release or threatened Release of Hazardous
Material in violation of any Environmental Law or which would reasonably be
expected to result in liability on any property owned, leased or operated by
Target or any Target Subsidiary or, to the Knowledge of Target, on adjacent
parcels of real estate.
SECTION 3.9. PROPERTIES.
(a) Except as listed in Section 3.9(a) of the Target Disclosure
Letter, Target or a Target Property Owner owns fee simple title to each of the
real properties (or the applicable portion thereof) described on Section 3.9(a)
of the Target Disclosure Letter as being owned in fee (collectively, the "OWNED
PROPERTIES"). Except as listed in Section 3.9(a) of the Target Disclosure
Letter, Target or a Target Property Owner has a valid leasehold interest in each
of the real properties (or the applicable portion thereof) described on
Section 3.9(a) of the Target Disclosure Letter as being ground (or air-rights)
leases or subleases (collectively, the "LEASED PROPERTIES" and, together with
the Owned Properties, collectively, the "TARGET PROPERTIES") pursuant to those
certain ground (or air-rights) leases or subleases (together with any amendments
thereto, collectively, the "TARGET GROUND LEASES") described on Section 3.9(a)
of the Target Disclosure Letter. The Target Properties are all of the real
properties owned or leased by Target and the Target Property Owners. The
interests of Target and the Target Property Owners in the Target Properties are
good, marketable and insurable and the same are owned free and clear of
Encumbrances except for (i) indebtedness for money borrowed and other matters
specifically identified in Section 3.9(a) of the Target Disclosure Letter,
(ii) inchoate Encumbrances imposed for construction work in progress described
on Section 3.9(a) of the Target Disclosure Letter or otherwise incurred in the
ordinary course of business that do not adversely affect in any material
respects the use or operation of the applicable Target Property (together with
clause (i), the "PERMITTED ENCUMBRANCES"), (iii) Space Leases, reciprocal
easement agreements and all matters disclosed on the existing title policies
which were previously provided (or made available) to Purchaser ("EXISTING TITLE
POLICIES"), matters as would be disclosed on current title reports or surveys
that arise in the ordinary course and do not adversely affect in any material
respects the use or operation of the applicable Target Property or as disclosed
in Section 3.9(a) of the Target Disclosure Letter and (iv) real estate Taxes and
special assessments not yet due and payable (except as is being contested in
good faith by appropriate proceedings and for which a reserve in accordance with
United States GAAP has been set forth in Section 3.9(a) of the Target Disclosure
Letter and on the books of Target or a Target Property Owner, as applicable).
(b) Except as listed in Section 3.9(b) of the Target Disclosure
Letter or which, individually or in the aggregate, would not reasonably be
expected to have a Target Material Adverse Effect, the Target Properties are not
subject to any rights of way, restrictive covenants,
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written agreements, Laws, ordinances and regulations affecting building use or
occupancy, or reservations of an interest in title (collectively, "TARGET
PROPERTY RESTRICTIONS"), except for (i) Target Property Restrictions imposed or
promulgated by Law with respect to real property, including zoning regulations,
(ii) the Space Leases, (iii) all matters disclosed on the Existing Title
Policies, matters as would be disclosed on current title reports or surveys that
arise in the ordinary course and do not adversely affect in any material
respects the use or operation of the applicable Target Property or as disclosed
in Section 3.9(b) of the Target Disclosure Letter and (iv) real estate Taxes and
special assessments not yet due and payable. Except as listed in Section 3.9(b)
of the Target Disclosure Letter or which, individually or in the aggregate,
would not reasonably be expected to have a Target Material Adverse Effect,
(i) each Target Property complies with the Target Property Restrictions,
(ii) neither Target nor any Target Property Owner, nor, to the Knowledge of
Target, any other party, is currently in default or violation of any Target
Property Restriction and (iii) no event has occurred which, with due notice or
lapse of time or both, would constitute a default thereunder.
(c) Except as listed in Section 3.9(c) of the Target Disclosure
Letter, valid policies of title insurance have been issued insuring Target's or
a Target Property Owner's fee simple title or leasehold estate to the Target
Properties except as noted therein, and, to the Knowledge of Target, such
policies are in full force and effect and no claim has been made against any
such policy.
(d) Except as listed in Section 3.9(d) of the Target Disclosure
Letter or which, individually or in the aggregate, would not reasonably be
expected to have a Target Material Adverse Effect, to the Knowledge of Target,
there is no certificate, permit or license from any Governmental Entity having
jurisdiction over any of the Target Properties or any agreement (including
without limitation any reciprocal easement agreement), easement or any other
right which is necessary to permit the current use and operation of the
buildings and improvements on any of the Target Properties or which is necessary
to permit the current use and operation of all driveways, roads and other means
of egress and ingress to and from any of the Target Properties (collectively,
the "PROPERTY AGREEMENTS") that has not been obtained and is not in full force
and effect, or any pending threat of modification or cancellation of any of
same. Except as listed in Section 3.9(d) of the Target Disclosure Letter or
which, individually or in the aggregate, would not reasonably be expected to
have a Target Material Adverse Effect, (i) neither Target nor any Target
Property Owner, nor to the Knowledge of Target, any other party, is currently in
default or violation of any Property Agreement and (ii) to the Knowledge of
Target no event has occurred which, with due notice or lapse of time or both,
would constitute a default or violation thereunder.
(e) Except as listed in Section 3.9(e) of the Target Disclosure
Letter or which, individually or in the aggregate, would not reasonably be
expected to have a Target Material Adverse Effect, neither Target nor any Target
Property Owner has received written notice of any violation of any federal,
state or municipal Law, ordinance, order, regulation or requirement affecting
any portion of any of the Target Properties issued by any Governmental Entity
that has not been heretofore remedied.
(f) Except as listed in Section 3.9(f) of the Target Disclosure
Letter or which, individually or in the aggregate, would not reasonably be
expected to have a Target Material
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Adverse Effect, neither Target nor any Target Property Owner has received
written notice to the effect that there are any, and there are no, (i)
condemnation or rezoning or proceedings that are pending or, to the Knowledge of
Target, threatened with respect to any portion of any of the Target Properties;
or (ii) zoning, building, land-use, fire, safety and signage or other applicable
Laws (including, without limitation, the American With Disabilities Act) or
orders that are presently being violated or will be violated by the continued
maintenance, operation or use of any buildings or other improvements on any of
the Target Properties or by the continued maintenance, operation or use of the
parking areas.
(g) Except as listed in Section 3.9(g) of the Target Disclosure
Letter, neither Target nor any Target Property Owner is obligated under any
option, right of first refusal or other contractual right to sell, dispose of or
lease any of the Target Properties or other personal property or any portion
thereof or interest therein to any Person other than Purchasers.
(h) Each Target Ground Lease is valid, binding and enforceable
against Target (or any Target Property Owner, as applicable) and, to the
Knowledge of Target, the other parties thereto in accordance with its terms, and
is in full force and effect. Except as listed in Section 3.9(h) of the Target
Disclosure Letter or which, individually or in the aggregate, would not
reasonably be expected to have a Target Material Adverse Effect, (i) Target has
performed all obligations required to be performed by it to date under each of
the Target Ground Leases and (ii) neither Target nor any Target Property Owner,
nor to the Knowledge of Target, any other party, is in default under any Target
Ground Lease (and no event has occurred which, with due notice or lapse of time
or both, would constitute such a default). Target has delivered (or made
available) to Purchaser a true, correct and complete copy of each Target Ground
Lease and all amendments thereto. No option has been exercised under any of such
Target Ground Leases, except options whose exercise has been evidenced by a
written document as described in Section 3.9(h) of the Target Disclosure Letter,
a true, complete and accurate copy of which has been delivered to Purchaser with
the corresponding Target Ground Lease.
(i) The rent roll for each of the Target Properties as of November
30, 2001 (collectively, the "RENT ROLL") has been provided or made available to
Purchasers. Except as disclosed in Section 3.9(i) of the Target Disclosure
Letter and for discrepancies that, either individually or in the aggregate,
would not reasonably be expected to have a Target Material Adverse Effect, the
information set forth in the Rent Roll is true, correct and complete as of the
date thereof. Except as disclosed in Section 3.9(i) of the Target Disclosure
Letter, neither Target nor any Target Property Owner, on the one hand, nor, to
the Knowledge of Target, any other party, on the other hand, is in default under
any Anchor Tenant Lease which, individually or in the aggregate, would
reasonably be expected to result in a Target Material Adverse Effect.
(j) Except as set forth in Section 3.9(j) of the Target Disclosure
Letter or which, individually or in the aggregate, would not reasonably be
expected to have a Target Material Adverse Effect, Target and each of the Target
Property Owners have good and sufficient title to, or are permitted to use under
valid and existing leases, all their personal and non-real properties and assets
(collectively, the "PERSONAL PROPERTY") reflected in their books and records as
being owned by them (including those reflected in the consolidated balance sheet
of Target as of February 28, 2001, except as since sold or otherwise disposed of
in the ordinary course of business) or used by them in the ordinary course of
business, free and clear of all liens
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and encumbrances, except such as are reflected on the consolidated balance sheet
of Target as of February 28, 2001, and the notes thereto, and except for liens
for current Taxes not yet due and payable, and liens or encumbrances which are
normal to the business of Target and the Target Property Owners and are not, in
the aggregate, material in relation to the assets of Target on a consolidated
basis and except also for such imperfections of title or leasehold interest,
easement and encumbrances, if any, as do not materially interfere with the
present use of the properties subject thereto or affected thereby, or as would
not otherwise reasonably be expected to cause a Target Material Adverse Effect.
(k) Except as set forth in Section 3.9(k) of the Target Disclosure
Letter or which, individually or in the aggregate, would not reasonably be
expected to have a Target Material Adverse Effect, there are no pending CAM or
similar audits by any Third Party.
SECTION 3.10. NO UNDISCLOSED MATERIAL LIABILITIES. Except as disclosed in
the Target Filings or as set forth in Section 3.10 of the Target Disclosure
Letter or as otherwise would not reasonably be expected to have a Target
Material Adverse Effect, there are no liabilities of Target or any Target
Subsidiaries, whether accrued, contingent, absolute or determined, other than:
(i) liabilities adequately provided for on the balance sheet of Target dated as
of February 28, 2001 (including the notes thereto) contained in the Annual
Accounts for the fiscal year ended February 28, 2001 of Target or
(ii) liabilities incurred in the ordinary course of business subsequent to
February 28, 2001.
SECTION 3.11. NO DEFAULT. Except as set forth in Section 3.11 of the
Target Disclosure Letter, neither Target nor any of the Target Subsidiaries is
in default or violation (and no event has occurred which, with notice or the
lapse of time or both, would constitute a default or violation) of any term,
condition or provision of:
(a) the Target Organizational Documents or the comparable charter or
organizational documents (including any operating agreement or limited
partnership agreement) of any of the Target Subsidiaries,
(b) any loan or credit agreement or note, including, but not limited
to, the Triggered Loans or any bond, mortgage, indenture, lease or other
agreement, instrument, permit, concession, franchise or license to which Target
or any of the Target Subsidiaries is now a party or by which Target or any of
the Target Subsidiaries or any of their respective properties or assets is
bound, or
(c) any order, writ, injunction, decree, statute, rule or regulation
applicable to Target or any of the Target Subsidiaries, except, in the case of
clauses (b) and (c), for defaults or violations which, individually or in the
aggregate, would not reasonably be expected to have a Target Material Adverse
Effect.
SECTION 3.12. COMPLIANCE WITH APPLICABLE LAWS. Target and the Target
Subsidiaries hold all permits, licenses, certificates, registrations, variances,
exemptions, orders, franchises and approvals of all Governmental Entities
necessary for the lawful conduct of their respective businesses (the "TARGET
PERMITS"), except where the failure so to hold, individually or in the
aggregate, would not reasonably be expected to have a Target Material Adverse
Effect. Target
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and the Target Subsidiaries are in compliance with the terms of Target Permits,
except where the failure to so comply, individually or in the aggregate, would
not reasonably be expected to have a Target Material Adverse Effect. Except as
disclosed in the Target Filings and as would not reasonably be expected to have
a Target Material Adverse Effect, the businesses of Target and the Target
Subsidiaries are not being conducted in violation of any Law (other than
Environmental Laws (as to which, representations are made in Section 3.8
hereof)) of any Governmental Entity. No investigation or review by any
Governmental Entity with respect to Target or any of the Target Subsidiaries is
pending and of which Target has Knowledge or, to the Knowledge of Target, is
threatened, other than those the outcome of which, individually or in the
aggregate, would not reasonably be expected to have a Target Material Adverse
Effect.
SECTION 3.13. LITIGATION. Except (i) as set forth in Section 3.13 of the
Target Disclosure Letter, (ii) litigation related to environmental matters,
including without limitation any matters arising under Environmental Laws (as to
which, representations are made in Section 3.8 hereof) and (iii) for routine
litigation arising from the ordinary course of business of Target and the Target
Subsidiaries which are adequately covered by insurance, there is no litigation,
arbitration, claim, investigation, suit, action or proceeding pending in which
service of process has been received by an employee of Target or, to the
Knowledge of Target, threatened against or affecting Target or any Target
Subsidiary that, individually or in the aggregate, would reasonably be expected
to have a Target Material Adverse Effect, nor is there any judgment, award,
decree, injunction, rule or order of any Governmental Entity or arbitrator
outstanding against Target or any Target Subsidiary of which Target has
Knowledge and which would reasonably be expected to, individually or in the
aggregate, have a Target Material Adverse Effect.
SECTION 3.14. TAXES. Except as set forth in Section 3.14 of the Target
Disclosure Letter:
(a) Target and each Target Subsidiary has timely filed all Tax
Returns required to be filed by it (after giving effect to any filing extension
properly granted by a Governmental Entity having authority to do so or otherwise
permitted by Law). Each such Tax Return is true, correct and complete in all
material respects. Target and each Target Subsidiary has paid, within the time
and in the manner prescribed by Law, all Taxes that are due and payable. The
most recent financial statements contained in the Target Filings and the
financial statements of Hexalon filed prior to the date of this Agreement
reflect an adequate reserve or accrued liabilities or expenses for all Taxes due
and payable by Target and the Target Subsidiaries for all taxable periods and
portions thereof through the date of such financial statements. Target has
established on its books and records reserves or accrued liabilities or expenses
that are adequate for the payment of all Taxes for which Target or any Target
Subsidiary is liable but are not yet due and payable. No deficiencies for Taxes
have been asserted or assessed in writing by a Governmental Entity against
Target or any Target Subsidiary, including claims by any Governmental Entity in
a jurisdiction where Target or any Target Subsidiary does not file Tax Returns
and no requests for waivers of the time to assess any such Taxes have been
granted and remain in effect or are pending.
(b) All Taxes which Target or the Target Subsidiaries are required
by Law to withhold or collect, including Taxes required to have been withheld in
connection with amounts
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paid or owing to any employee, independent contractor, creditor, stockholder or
other third party and sales, gross receipts and use taxes, have been duly
withheld or collected and, to the extent required, have been paid over to the
proper Governmental Entities or are held in separate bank accounts for such
purpose. There are no Encumbrances for Taxes upon the assets of the Target
Subsidiaries except for statutory Encumbrances for Taxes not yet due.
(c) The Tax Returns of Target and any Target Subsidiary have not
been audited by any taxing authority and there are no audits by and contests
with any taxing authority currently being conducted with regard to Taxes or Tax
Returns of Target, any Target Subsidiary and any Target Non-Purchased Entity
and, to the Knowledge of Target, there are no audits pending with or proposed by
any taxing authority with respect to any Taxes or Tax Returns.
(d) None of Target or the Target Subsidiaries have any liability for
the Taxes of any Person other than Target or the Target Subsidiaries and Target
and the Target Subsidiaries do not have any liability for the Taxes of any
Person other than Target or the Target Subsidiaries either (i) under Treasury
Regulation Section 1.1502-6 (or any similar provision of state, local or foreign
Law) or (ii) to the Knowledge of Target as a transferee or successor.
(e) Each Target Subsidiary that is a U.S. corporation has disclosed
to the IRS all positions taken on their federal income Tax Returns which could
give rise to a substantial understatement of Tax under Section 6662 of the Code.
(f) Based on the assumptions as to purchase price allocations to
specific assets provided by the Purchasers' and as set forth in the Pro Forma
Tax Returns, the consummation of the transactions contemplated by this Agreement
and the Transaction Documents will not result in any Taxes being payable by any
Target, any Target Subsidiary, any Target Non-Purchased Entity or any Purchaser
to any Governmental Entity, except for (i) Excluded Taxes, (ii) Transfer and
Gain Taxes not exceeding $15,000,000 in the aggregate and (iii) other Taxes in
an aggregate amount not to exceed $3,000,000.
(g) Target (i) has been subject to taxation as a BI within the
meaning of Article 28 of the Netherlands Corporate Income Tax Act of 1969, as
amended, commencing with the first taxable year of its operations, and has
satisfied all requirements to qualify as a BI for such year and each year
thereafter, (ii) has operated, and intends to continue to, operate in such
manner as to qualify as a BI until the Closing and until the time the proceeds
from the proceeds from the Purchase are distributed to the shareholders of
Target in accordance with the Protocol.
(h) Hexalon (i) has been subject to taxation as a REIT within the
meaning of Section 856 of the Code commencing with the first taxable year of its
operations, and has satisfied all requirements to qualify as a REIT for such
year and each year thereafter, (ii) has operated, and intends to continue to
operate, in such a manner as to qualify as a REIT for the taxable year ending
December 31, 2001, and thereafter until the Closing and has no liability for
taxes under Section 11, 857(b), 860(c) or 4981 of the Code and (iii) has not
taken or omitted to take any action which would reasonably be expected to
(A) result in any rents paid by the tenants of the Properties to be excluded
from the definition of "rents from real property" under Section 856(d)(2)(C) of
the Code, or (B) otherwise result in a challenge to its status as a REIT, and no
such challenge is pending or, to the Knowledge of Target is threatened. Each
Subsidiary
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of Hexalon and any Person Hexalon owns an interest in which is a
partnership, joint venture or limited liability company (i) has been since its
formation and continues to be treated for federal income tax purposes as a
partnership and not as a corporation or an association taxable as a corporation
or ignored as a separate entity, as the case may be, and (ii) has not since its
formation owned any assets (including, without limitation, securities) that
would cause Hexalon to violate Section 856(c)(4) of the Code. Each Subsidiary
of Hexalon which is a corporation or treated as an association taxable as a
corporation and any Person in which Hexalon owns 10% or more, by vote or by
value, of such Person's outstanding securities, is a qualified REIT subsidiary
under Section 856(i) of the Code or a taxable REIT subsidiary under Section
856(l) of the Code.
(i) Except as set forth in the Urban Tax Indemnification Agreement,
neither Target nor any Target Subsidiary has entered into or is subject,
directly or indirectly, to any "Tax Protection Agreements." As used herein, a
Tax Protection Agreement is an agreement, oral or written, (A) that has as one
of its purposes to permit a person or entity to take the position that such
person or entity could defer federal taxable income that otherwise might have
been recognized upon a transfer of property to the Target Partnership or any
other Target Subsidiary that is treated as a partnership for federal income tax
purposes, and (B) that (i) prohibits or restricts in any manner the disposition
of any assets of Target or any Target Subsidiary, (including, without
limitation, requiring Target or any Target Subsidiary to indemnify any person
for any tax liabilities resulting from any such disposition), (ii) requires that
Target or any Target Subsidiary maintain, or put in place, or replace,
indebtedness, whether or not secured by one or more of the Target Properties, or
(iii) requires that Target or any Target Subsidiary offer to any person or
entity at any time the opportunity to guarantee or otherwise assume, directly or
indirectly, the risk of loss for federal income tax purposes for indebtedness or
other liabilities of Target or any Target Subsidiary.
(j) Neither Target nor any Target Subsidiary is a party to, is bound
by or has an obligation under any Tax sharing agreement, Tax indemnification
agreement or similar contract or arrangement (other than Urban Tax
Indemnification Agreement), including any agreement, contract or arrangement
providing for the sharing or ceding of credits or losses, or has a potential
liability or obligation as a result of or pursuant to any such agreement,
contract, arrangement or commitment. No closing agreement pursuant to
section 7121 of the Code (or any predecessor provision) or any similar provision
of any state, local or foreign has been entered into by or on behalf of the
Target or any Subsidiary. No power of attorney or similar document which is
currently in force has been granted by Target or any Target Subsidiary with
respect to any matter relating to Taxes.
SECTION 3.15. PENSION AND BENEFIT PLANS; ERISA. Except as set forth in
Section 3.15 of the Target Disclosure Letter:
(a) All "employee pension benefit plans," as defined in Section 3(2)
of ERISA, maintained or contributed to by Target or any trade or business
(whether or not incorporated) which is under common control, or which is treated
as a single employer, with Target under Section 414(b), (c), (m) or (o) of the
Code (a "TARGET ERISA AFFILIATE") or to which Target or any of the Target
Subsidiaries or any Target ERISA Affiliate contributed or is obligated to
contribute thereunder within six years prior to the Closing (the "TARGET PENSION
PLANS") intended to qualify under Section 401 of the Code have received a
favorable
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determination letter from the IRS and such determination has not been modified,
revoked or limited, and, to the Knowledge of Target as of the Closing Date,
nothing has occurred with respect to the operation of Target Pension Plans that
could reasonably be expected to cause the loss of such qualification or the
imposition of any material liability, penalty or Tax under ERISA or the Code.
(b) Neither Target nor any Target ERISA Affiliate currently
sponsors, contributes to, maintains or has liability (whether contingent or
otherwise) under (i) a "multiemployer plan" (as defined in Section 4001(a)(3) of
ERISA) or (ii) an employee benefit plan that is or was subject to Part 3 of
Subtitle B of Title I of ERISA, Section 412 of the Code, or Title IV of ERISA.
(c) To the Knowledge of Target, there is no violation of ERISA or
the Code with respect to (i) the filing of applicable reports, documents, and
notices with the Secretary of Labor and the Secretary of the Treasury regarding
all "employee benefit plans," as defined in Section 3(3) of ERISA, and all other
employee compensation and benefit arrangements or payroll practices, including,
without limitation, severance pay, sick leave, vacation pay, salary continuation
for disability, consulting or other compensation agreements, retirement,
deferred compensation, bonus (including, without limitation, any retention bonus
plan), long-term incentive, stock option, stock purchase, hospitalization,
medical insurance, life insurance and scholarship programs maintained by Target
or any of the Target Subsidiaries or with respect to which Target or any of the
Target Subsidiaries has any liability or Target Pension Plans (all such plans,
including Target Pension Plans, being hereinafter referred to as the "TARGET
EMPLOYEE BENEFIT PLANS") or (ii) the furnishing of such documents to the
participants or beneficiaries of Target Employee Benefit Plans.
(d) Each Target Employee Benefit Plan, related trust (or other
funding or financing arrangement) and all amendments thereto are listed in
Section 3.15(d) of the Target Disclosure Letter, true and complete copies of
which have been made available to Purchasers, as have the most recent summary
plan descriptions, administrative service agreements, Form 5500s and, with
respect to any Target Employee Benefit Plan intended to be qualified pursuant to
Section 401(a) of the Code, a current IRS determination letter.
(e) Each Target Employee Benefit Plan is, and its administration is
and has been, in material compliance with, and none of Target nor any of the
Target Subsidiaries has received any claim, notice or information that any such
Target Employee Benefit Plan is not in compliance with, its terms and all
applicable Laws, regulations, rulings and all other applicable governmental
Laws, regulations and orders, and prohibited transaction exemptions, including,
without limitation, the requirements of ERISA, bonding requirements and the
furnishing of documents to the participants and beneficiaries (and other
individuals entitled to such documents) of each such plan.
(f) To the Knowledge of Target, there is no liability for breaches
of fiduciary duty in connection with Target Employee Benefit Plans, and neither
Target nor any of the Target Subsidiaries or any "party in interest" or
"disqualified person" with respect to Target Employee Benefit Plans has engaged
in a non-exempt "prohibited transaction" within the meaning of Section 4975 of
the Code or Section 406 of ERISA.
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(g) There are no actions, disputes, suits, claims, arbitration or
legal, administrative or other proceeding or governmental investigation pending
(other than routine claims for benefits) or, to the Knowledge of Target,
threatened, alleging any breach of the terms of any Target Employee Benefit Plan
or of any fiduciary duties thereunder or violation of any applicable Law with
respect to any such Target Employee Benefit Plan.
(h) Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby, whether alone, or in
connection with any other event, will (i) result in any payment (including, but
not limited to, any retention bonuses, parachute payments or noncompetition
payments) becoming due to any employee or former employee or group of employees
or former employees of Target or any of the Target Subsidiaries; (ii) increase
any benefits otherwise payable under any Target Employee Benefit Plan or any
Target Employment Agreement; (iii) result in the acceleration of the time of
payment or vesting of any such rights or benefits; or (iv) result in the payment
of any "excess parachute payment" within the meaning of Section 280G of the Code
with respect to a current or former employee of Target or any of the Target
Subsidiaries.
(i) There are no severance agreements or policies, noncompetition
agreements or employment agreements between Target or any of the Target
Subsidiaries and any employee of Target or such Target Subsidiary, and true and
complete copies of all severance agreements and policies and employment
agreements described in Section 3.15(i) of the Target Disclosure Letter have
been provided to Purchasers.
(j) Neither Target nor any of the Target Subsidiaries has any
consulting agreement or arrangement, whether oral or written, with any Person
involving annual compensation in excess of $100,000.
(k) All contributions, premiums and other payments required by Law
or any Target Employee Benefit Plan or applicable collective bargaining
agreement have been made under any such plan to any fund, trust or account
established thereunder or in connection therewith by the due date thereof, and
no amounts are or will be due to the Pension Benefit Guaranty Corporation as of
the Closing Date (except for premiums in the ordinary course of business, which
will be payable by Target); and any and all contributions, premiums and other
payments with respect to compensation or service before and through the Closing
Date, or otherwise with respect to periods before and through the Closing Date,
due from any of Target or its ERISA Affiliates to, under or on account of each
Target Employee Benefit Plan shall have been paid prior to the Closing Date or
shall have been fully reserved and provided for or accrued on Target financial
statements.
(l) No stock or other security issued by Target or any of the Target
Subsidiaries forms or has formed a part of the assets of any Target Employee
Benefit Plan.
(m) No Target Employee Benefit Plan that is a "welfare benefit plan"
as defined in Section 3(1) of ERISA provides for continuing benefits or coverage
for any participant or beneficiary or covered dependent of a participant after
such participant's termination of employment, except to the extent required by
Law.
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(n) All Target Employee Benefit Plans that provide medical, dental
health or long-term disability benefits are fully insured and claims with
respect to any participant or covered dependent under such Target Employee
Benefit Plan could not reasonably result in any uninsured liability to Target,
any Target Subsidiary or Purchasers. Target and Target ERISA Affiliates have
complied in all material respects with the requirements of Section 4980B of the
Code and Parts 6 and 7 of Subtitle B of Title I of ERISA regarding health care
coverage under Target Employee Benefit Plans.
(o) No amount has been paid by Target or any of Target ERISA
Affiliates, and no amount is expected to be paid by Target or any of Target
ERISA Affiliates, which would be subject to the provisions of Section 162(m) of
the Code such that all or a part of such payments would not be deductible by the
payor.
(p) Without limiting any other provision of this SECTION 3.15, no
event has occurred and no condition exists, with respect to any Target Employee
Benefit Plan, that has subjected or could subject Target or any Target ERISA
Affiliate, or any Target Employee Benefit Plan or any successor thereto, to any
Tax, fine, penalty or other liability (other than, in the case of Target, a
Target ERISA Affiliate and Target Employee Benefit Plans, a liability arising in
the normal course to make contributions or payments, as applicable, when
ordinarily due under a Target Employee Benefit Plan with respect to employees of
Target and the Target Subsidiaries). No event has occurred and no condition
exists, with respect to any Target Employee Benefit Plan that could subject
Purchasers or any of its Affiliates, or any plan maintained by Purchasers or any
of their Affiliates (other than an Affiliate which becomes such pursuant to the
transactions contemplated by this Agreement) thereof, to any Tax, fine, penalty
or other liability, that would not have been incurred by Purchasers or any of
their Affiliates, or any such plan, but for the transactions contemplated
hereby. No plan other than a Target Employee Benefit Plan is or will be directly
or indirectly binding on Purchasers by virtue of the transactions contemplated
hereby. Purchasers and their Affiliates, including on and after the Closing
Date, Target and any Target ERISA Affiliate, to the knowledge of Target, shall
have no liability for, under, with respect to or otherwise in connection with
any plan, which liability arises under ERISA or the Code, by virtue of Target or
any Target Subsidiary being aggregated in a controlled group or affiliated
service group with any Target ERISA Affiliate for purposes of ERISA or the Code
at any relevant time prior to the Closing Date (other than a liability from
providing benefits arising in the ordinary course of business).
(q) Each Target Employee Benefit Plan may be unilaterally amended or
terminated in its entirety by Target without liability except as to benefits
accrued thereunder prior to amendment or termination.
(r) All individual employment, termination, severance, change in
control, retention, bonus, post-employment and other compensation agreements,
arrangements and plans existing prior to the execution of this Agreement or
which will exist prior to the Closing, which are between Target or a Target
Subsidiary and any current or former director, officer or employee thereof,
including the name of such current or former director, officer or employee, the
type of agreement and the amount of any estimated severance payment (including
estimated gross up) owed thereunder due to the transactions contemplated by this
Agreement and any
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subsequent termination of employment, are listed in Section 3.15(r) the Target
Disclosure Letter (collectively, the "TARGET EMPLOYMENT AGREEMENTS").
SECTION 3.16. LABOR AND EMPLOYMENT MATTERS. Except as set forth in
Section 3.16 of the Target Disclosure Letter or as would not be reasonably
expected to have a Target Material Adverse Effect:
(a) Neither Target nor any of the Target Subsidiaries is a party to
any collective bargaining agreement or other current labor agreement with any
labor union or organization, and there is no question involving current union
representation of employees of Target or any of the Target Subsidiaries, nor
does Target or any of the Target Subsidiaries 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 Knowledge of Target, threatened against Target or any of the Target
Subsidiaries.
(c) There is no complaint, lawsuit or proceeding in any forum by or
on behalf of any present or former employee, any applicant for employment 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 in connection with
the employment relationship pending, or, to the Knowledge of Target, threatened
against Target or any of the Target Subsidiaries.
(d) There is no strike, slowdown, work stoppage or lockout pending,
or, to the Knowledge of Target, threatened, against or involving Target or any
of the Target Subsidiaries.
(e) The employees of Target and the Target Subsidiaries are lawfully
authorized to work in the United States according to federal immigration Laws.
(f) Target and each of the Target Subsidiaries are in compliance
with all applicable Laws in respect of employment and employment practices,
terms and conditions of employment, wages, hours of work 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 Knowledge of
Target, threatened, with respect to which any current or former director,
officer, employee or agent of Target or any of the Target Subsidiaries is
claiming indemnification from Target or any of the Target Subsidiaries.
SECTION 3.17. CONTRACTS
(a) Section 3.17(a) of the Target Disclosure Letter lists all
Material Contracts of Target and all Target Subsidiaries. Except as set forth in
Section 3.17(a) of the Target Disclosure Letter or in the Target Filings, each
Material Contract of Target or a Target Subsidiary is valid, binding and
enforceable and in full force and effect, except where such failure to be so
valid, binding and enforceable and in full force and effect would not,
individually
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or in the aggregate, reasonably be expected to have a Target Material Adverse
Effect, and there are no defaults or violations thereunder, nor does there exist
any condition which upon the passage of time or the giving of notice or both
would cause such a violation of or a default thereunder, except those defaults
or violations that would not, individually or in the aggregate, reasonably be
expected to have a Target Material Adverse Effect. Target has made available, or
caused to be made available, to Purchasers true and complete copies of each
Material Contract and all ancillary documents pertaining thereto.
(b) All mortgages, deeds of trust, loan agreements or other
documents on any of the Assets are listed in Section 3.17(b) of the Target
Disclosure Letter. The transactions contemplated hereby and by the Transaction
Documents will not trigger any due-on-sale provision on any of such mortgages,
deeds of trust, loan agreements or other documents, except as set forth in
Section 3.17(b) of the Target Disclosure Letter and will not require the consent
of any mortgage lender, except as set forth in Section 3.17(b) of the Target
Disclosure Letter.
(c) Except as set forth in Section 3.17(c) of the Target Disclosure
Letter, there is no confidentiality agreement, non-competition agreement or
other contract or agreement that contains covenants that restrict Target's
ability to conduct its business in any location.
(d) Except as set forth in Section 3.17(d) of the Target Disclosure
Letter, there are no indemnification agreements entered into by and between
Target and any director or officer of Target or any of the Target Subsidiaries.
(e) All joint venture agreements are listed in Section 3.17(e) of
the Target Disclosure Letter. The transactions contemplated by this Agreement
and the Transaction Documents will not trigger any termination, buy-sell,
transfer, option, right of first refusal, right of first offer, tag-along or any
similar right by any party under any of such joint venture agreements, except as
set forth in Section 3.17(e) of the Target Disclosure Letter and will not
require the consent of any joint venture partner, except as set forth in
Section 3.17(e) of the Target Disclosure Letter.
SECTION 3.18. INTANGIBLE PROPERTY. Target and the Target Subsidiaries own,
possess or have adequate rights to use all trademarks, trade names, patents,
service marks, brand marks, brand names, computer programs, databases,
industrial designs, domain names and copyrights currently used in the operation
of the businesses of each of Target and the Target Subsidiaries (collectively,
the "TARGET INTANGIBLE PROPERTY"), except where the failure to possess or have
adequate rights to use such property, individually or in the aggregate, would
not reasonably be expected to have a Target Material Adverse Effect.
Section 3.18 of the Target Disclosure Letter sets forth a list of all
trademarks, trade names, patents, service marks and domain names owned by Target
or any Target Subsidiary. All of Target Intangible Property is owned or licensed
by Target or the Target Subsidiaries free and clear of any and all Encumbrances,
except as would not, individually or in the aggregate, reasonably be expected to
have a Target Material Adverse Effect, and neither Target nor any such Target
Subsidiary has forfeited or otherwise relinquished any Target Intangible
Property. To the Knowledge of Target, the use of Target Intangible Property by
Target or the Target Subsidiaries does not in any material respect, conflict
with, infringe upon, violate or interfere with or constitute an appropriation of
any right, title, interest or goodwill, including, without limitation, any
intellectual property right, trademark, trade name,
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patent, service xxxx, brand xxxx, brand name, computer program, database,
industrial design, copyright or any pending application therefore, of any other
Person. Except as set forth in Section 3.18 of the Target Disclosure Letter, to
the Knowledge of Target, there have been no claims made, and neither Target nor
any of the Target Subsidiaries has received any notice of any claim nor does
Target otherwise have Knowledge that any of Target Intangible Property is
invalid or conflicts with the asserted rights of any other Person or has not
been used or enforced or has failed to have been used or enforced in a manner
that would result in the abandonment, cancellation or unenforceability of any of
Target Intangible Property, except as would not, individually or in the
aggregate, reasonably be expected to have a Target Material Adverse Effect.
SECTION 3.19. INSURANCE. Section 3.19 of the Target Disclosure Letter sets
forth an insurance schedule of Target. Target and each of the Target
Subsidiaries 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 Target and each
of the Target Subsidiaries. Except as set forth in this SECTION 3.19, neither
Target nor any of the Target Subsidiaries has received any written notice of
cancellation or termination with respect to any existing material insurance
policy of Target or any of the Target Subsidiaries.
SECTION 3.20. BROKERS. Except for the fees and expenses payable to the
Target Financial Advisor (which fees and the engagement letter with respect to
such Person have been disclosed to Purchasers), no broker, investment banker or
other Person is entitled to any broker's, finder's or other similar fee or
commission in connection with the transactions contemplated by the Transaction
Documents based upon arrangements made by or on behalf of Target or any Target
Subsidiary.
SECTION 3.21. RELATED PARTY TRANSACTIONS. Except as disclosed in the
Target Filings or as set forth in Section 3.21 of the Target Disclosure Letter,
there are no material arrangements, agreements or contracts entered into by
Target or any of the Target Subsidiaries, on the one hand, and any Person who is
an officer, director or affiliate of Target or any Target Subsidiary, any
relative of the foregoing or an entity of which any of the foregoing is an
affiliate, on the other hand. Copies of all such documents have been made
available to Purchasers.
SECTION 3.22. OPINION OF FINANCIAL ADVISOR. The Supervisory Board and the
Management Board of Target have received the written opinion of the Target
Financial Advisor to the effect that, based on, and subject to the various
assumptions and qualifications set forth in such opinion, as of the date of such
opinion, the Purchase Price to be received by Target pursuant to this Agreement
is fair from a financial point of view to Target's shareholders. A copy of the
written opinion of the Target Financial Advisor has been delivered to the
Purchasers.
SECTION 3.23. INVESTMENT COMPANY ACT OF 1940. Neither the Target nor any
of the Target Subsidiaries is, or at the Closing will be, required to be
registered as an investment company under the Investment Company Act of 1940, as
amended.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER PARTIES
As an inducement to Target to enter into this Agreement, each Purchaser
Party hereby jointly and severally represents and warrants to Target as follows:
SECTION 4.1. ORGANIZATION, STANDING AND POWER. Each Purchaser Party is a
corporation, limited partnership or limited liability company duly formed and
validly existing under the Laws of the state jurisdiction in which it is
organized and is in good standing in such jurisdiction.
SECTION 4.2. AUTHORITY; NO VIOLATIONS; CONSENTS AND APPROVALS.
(a) Each Purchaser Party has the corporate, limited partnership or
limited liability company power, as applicable, and authority to enter into the
Transaction Documents to which it is a party and to consummate the transactions
contemplated hereby or thereby. The execution and delivery of the Transaction
Documents and the consummation of the transactions contemplated hereby or
thereby have been duly authorized by all necessary action on the part of the
Purchaser Parties.
(b) The Transaction Documents to which each Purchaser Party is a
party have been duly executed and delivered by each such entity, and, constitute
valid and binding obligations of each such entity enforceable in accordance with
their terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium and other Laws of general applicability
relating to or affecting creditors' rights and by general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at Law).
(c) The execution and delivery of the Transaction Documents by each
Purchaser Party do not, and the consummation of the transactions contemplated
hereby or thereby, and compliance with the provisions hereof or thereof, will
not, conflict with, or result in any violation of, or default (with or without
notice or lapse of time, or both) under, or give rise to a right of termination,
cancellation or acceleration of any material obligation or the loss of a
material benefit under, or give rise to a right of purchase under, result in the
creation of any Encumbrance upon any of the properties or assets of such parties
under, require the consent or approval of any third party or otherwise result in
a material detriment to such parties under, require the consent or approval of
any third party or otherwise result in a material detriment to such parties
under, any provision of (A) the organizational documents of such entity, (B) any
Material Contract applicable to such entity, its properties or assets or any
guarantee by such entity, (C) any joint venture or other ownership arrangement
applicable to such entity or (D) assuming the consents, approvals,
authorizations or permits and filings or notifications referred to in
SECTION 4.2(d) are duly and timely obtained or made, any judgment, order,
decree, statute, Law, ordinance, rule or regulation applicable to such entity or
any of its properties or assets, other than, in the case of clauses (B), (C) and
(D), any such conflicts, violations, defaults, rights, Encumbrances or
detriments that, individually or in the aggregate, would not reasonably be
expected to materially impair or delay the ability of such entity to perform its
obligations
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hereunder or under any of the other Transaction Documents or prevent the
consummation of any of the transactions contemplated hereby or thereby.
(d) No consent, approval, order or authorization of, or
registration, declaration or filing with, or permit from any Governmental Entity
is required by or with respect to a Purchaser Party in connection with the
execution and delivery by such entity of the Transaction Documents to which such
entity is a party or the consummation by such entity of the transactions
contemplated hereby or thereby, except for: (A) the filing with the SEC of such
reports under Section 13(a) of the Exchange Act and such other compliance with
the Securities Act and the Exchange Act and the rules and regulations thereunder
as may be required in connection with this Agreement and the transactions
contemplated hereby; (B) such filings and approvals as may be required by any
applicable Environmental Laws; (C) filings under the HSR Act, if applicable;
(D) filings necessary to obtain the Enterprise Chamber approval or otherwise
required by the Protocol or applicable Dutch Law and (E) any such consent,
approval, order, authorization, registration, declaration, filing or permit that
the failure to obtain or make would not reasonably be expected to materially
impair or delay the ability of such entity to perform its obligations hereunder
or under any of the other Transaction Documents or prevent the consummation of
any of the transactions contemplated hereby or thereby.
SECTION 4.3. AVAILABLE FUNDS. On the Closing Date, Purchasers will have
available all funds necessary to pay the Purchase Price and to satisfy all of
their other respective obligations hereunder and in connection with the
Purchase. The obligations of the Purchaser Parties hereunder are not subject to
any conditions regarding the ability of Purchaser Parties to obtain financing
for the consummation of the transactions contemplated herein.
SECTION 4.4. BROKERS. No broker, investment banker or other person is
entitled to any broker's, finder's or other similar fee or commission in
connection with the transactions contemplated by the Transaction Documents based
upon arrangements made by or on behalf of the Purchaser Parties, for which fee
or commission Target or any Target Subsidiary may be liable.
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ARTICLE V
ADDITIONAL AGREEMENTS
SECTION 5.1. CONDUCT OF BUSINESS BY TARGET PRIOR TO THE CLOSING.
(a) During the period from the date of this Agreement to the earlier
of the termination of this Agreement or the Closing, Target shall and shall
cause each of the Target Subsidiaries (other than the Joint Ventures) to, carry
on its businesses in the usual, regular and ordinary course consistent with past
practices and in material compliance with the expenditure thresholds set forth
in the budgets of Target and the Target Subsidiaries listed in Section 5.1(a) of
the Target Disclosure Letter and such further budgets as are approved by
Purchasers from time to time. During the period from the date of this Agreement
to the earlier of the termination of this Agreement or the Closing, Target shall
use reasonable efforts to cause each of the Joint Ventures and the Target
Non-Subsidiary Entities to carry on its businesses in the usual, regular and
ordinary course consistent with past practices and with the budgets of such
entity as described above. Prior to Closing, Target shall, or shall cause a
Target Subsidiary to, (i) close the acquisition of the Oakbrook ground lease
pursuant to the terms of that certain contract, dated December 20, 2001, between
LaSalle National Trust and the Teachers Retirement System of the State of
Illinois (the "OAKBROOK CONTRACT") and, if permissible under the existing
Oakbrook mortgages, terminate said lease and (ii) at Purchasers' direction,
cause to be released of record any mortgage or deed of trust which currently may
be shown as an Encumbrance against Lakeside Mall, without payment to any party.
(b) Without limiting the generality of the foregoing, during the
period from the date of this Agreement to the earlier of the termination of this
Agreement or the Closing, except as otherwise contemplated by this Agreement or
to the extent consented to in writing by Purchasers, Target shall not and shall
not authorize or commit or agree to, shall cause the Target Subsidiaries (other
than the Joint Ventures) not to (and not to authorize or commit or agree to),
and shall use reasonable efforts to cause each of the Joint Ventures and the
Target Non-Subsidiary Entities not to (and not to authorize or commit or agree
to) :
(i) amend the Target Organizational Documents or any other
comparable charter or organizational documents of any Target Subsidiary or
any Target Non-Subsidiary Entity;
(ii) acquire or agree to acquire by merging or consolidating
with, or by purchasing a substantial portion of the assets of, or by any
other manner, any business or any corporation, partnership, joint venture,
association or other business organization or division thereof (including
entities which are Subsidiaries), or acquire any assets, including real
estate, except purchases in the ordinary course of business consistent with
past practice in an amount not involving more than $500,000, in the
aggregate;
(iii) except for the Disposal Agreements, (A) enter into any new
commitments obligating Target, any Target Subsidiary or any Target
Non-Subsidiary Entity to make capital expenditures in excess of $1,000,000
in the aggregate, not including tenant allowances under existing leases and
the commitments specifically
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reflected in the budgets referenced in Section 5.1(a) and as set forth in
Section 5.1(b)(iii)(A) of the Target Disclosure Letter, (B) acquire, enter
into any option to acquire, or exercise an option or other right or
election or enter into any other commitment or contractual obligation
(each, a "COMMITMENT") for the acquisition of any real property or other
transaction (other than any Commitment referred to in Section
5.1(b)(iii)(B) of the Target Disclosure Letter) involving nonrefundable
deposits in excess of $250,000 and, in any event, not in excess of
$1,000,000 in the aggregate, (C) commence construction of, or enter into
any Commitment to develop or construct, other real estate projects
involving in excess of $500,000, (D) incur net borrowings in any seven (7)
day period in excess of $1,000,000, except borrowings required to (i)
comply with the terms of the Oakbrook Contract not to exceed $35,000,000 or
(ii) complete the Voting Trust Redemption or (E) enter into any lease in
excess of 10,000 square feet or incur or commit to incur any tenant
allowances or landlord funded construction expenditures related thereto;
(iv) (A) redeem, purchase or otherwise acquire, directly or
indirectly, any of its capital stock or other securities, other than the
Voting Trust Redemption; (B) issue, sell, pledge, dispose of or encumber
any additional shares of its capital stock or other equity interests,
securities convertible into or exchangeable for, or options, warrants,
calls, commitments or rights of any kind to acquire, any shares of its
capital stock or other equity interests, or its other securities; or (C)
split, combine or reclassify any of its outstanding capital stock or other
equity interests;
(v) transfer, sell, license, pledge, mortgage, subject to
Encumbrance or otherwise dispose of any of the Assets, except as disclosed
in Section 5.1(b)(v) of the Target Disclosure Letter and to the extent
specifically reflected in the budgets referenced in Section 5.1(a) or
pursuant to the Disposal Agreements;
(vi) make or rescind any election relating to Taxes or suffer
the termination or revocation of any election relating to REIT or BI status
(unless Target reasonably determines, after prior consultation with
Purchasers, that such action is (a) required by Law; (b) necessary or
appropriate to preserve the status of certain Target Subsidiaries as a REIT
or any other Target Subsidiary which files Tax Returns as a partnership for
federal tax purposes; or (c) commercially reasonable in the context of
Target's business and relates to a change in Law in 2001 or thereafter);
PROVIDED, that, nothing in this Agreement shall preclude any Target
Subsidiary that is a REIT from designating dividends paid by it as "capital
gain dividends" within the meaning of Section 857 of the Code (with the
prior written consent of Purchasers, which will not be unreasonably
withheld) or electing to treat any entity as a "taxable REIT subsidiary"
(within the meaning of Section 856(i) of the Code);
(vii) except as may be required by written contractual
commitments existing on the date hereof, referred to in Schedule
5.1(b)(vii) of the Target Disclosure Letter, and provided to Purchasers,
(A) increase the compensation or benefits payable or to become payable to
its officers or employees or officers or employees of any Target Subsidiary
or Affiliate thereof, other than (1) increases in compensation to
Non-Covered Employees in the ordinary course of business consistent with
past practice (PROVIDED,
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such increases, in the aggregate, shall not exceed three and one-half
percent (3 1/2%) of any such Non-Covered Employee's base salary) and (2)
the payment of 2001 annual bonuses in the ordinary course of business
consistent with past practice (PROVIDED, with respect to any employee , the
amount that the bonus represents as a percentage of such employee's base
salary shall not exceed the percentage that the employee's annual bonus for
2000 represented of such employee's base salary for 2000), (B) establish,
adopt, enter into or amend any collective bargaining, bonus, profit
sharing, thrift, compensation, employment, termination, severance, stock
incentive or other plan, agreement, trust, fund, policy or arrangement for
the benefit of any director, officer or employee, except as contemplated by
this Agreement or to the extent required by applicable Law or the terms of
a collective bargaining agreement, (C) increase the benefits payable under
any existing severance or termination pay policies or employment or other
agreements, (D) take any affirmative action to accelerate the vesting of
any stock-based compensation, (E) grant any awards under any bonus,
incentive, performance or other compensation plan or arrangement or Target
Employee Benefit Plan (including the grant of stock options, stock
appreciation rights, stock based or stock related awards, performance units
or restricted stock, or the removal of existing restrictions in any Target
Employee Benefit Plans or agreements or awards made thereunder) or (F) take
any action to fund or in any other way secure the payment of compensation
or benefits under any employee plan, agreement, contract or arrangement or
Target Employee Benefit Plan;
(viii) (A) enter into any employment, consulting or severance
agreement with or grant any severance or termination pay to any officer,
director or employee of Target or any Target Subsidiary; or (B) hire or
agree to hire any new or additional employees or officers, PROVIDED,
HOWEVER, that if any Non-Covered Employee resigns after the date hereof but
prior to Closing, such entity may hire a person to replace such employee on
substantially similar terms consistent with past practice, subject to the
restrictions of clause (A) above;
(ix) except as set forth in Section 5.1(b)(ix) of the Target
Disclosure Letter, enter into or amend or otherwise modify any agreement or
arrangement with persons that are Affiliates of Target (other than
agreements with Target Subsidiaries) or, as of the date of this Agreement,
are employees, officers or directors of Target or any Target Subsidiary;
(x) except as otherwise permitted or contemplated by this
Agreement or the Protocol, authorize, recommend, propose or announce an
intention to adopt, or effect, a plan of complete or partial liquidation or
dissolution of Target, any Target Subsidiary or any Target Non-Subsidiary
Entity;
(xi) materially amend or terminate, or waive compliance with
the terms of or breaches under, any Material Contract or enter into a new
contract, agreement or arrangement that, if entered into prior to the date
of this Agreement, would have been required to be listed in the Target
Disclosure Letter pursuant to SECTION 3.15;
(xii) declare, set aside or pay any dividend or other
distribution payable in cash, stock or property with respect to its capital
stock or other equity interests;
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PROVIDED, HOWEVER, that (A) on or after April 15, 2002, distributions may
be declared and paid to Target by the Target Subsidiaries in an amount not
greater than the Ordinary Dividend Amount in order to fund the ordinary
annual distribution for 2002 payable to shareholders of Target on or after
May 15, 2002 (the "ORDINARY DIVIDEND"), (B) Target may declare and pay the
Ordinary Dividend on or after May 15, 2002 to shareholders of Target, (C)
distributions may be declared and paid to the Target Non-Purchased Entities
by the Target Subsidiaries in amounts necessary to fund the Target
Non-Purchased Entities' reasonable administrative expenses consistent with
past practice and expenses related to the transactions contemplated hereby,
provided such expenses shall not in the aggregate exceed $1,000,000 per
month, (D) distributions may be declared and paid to Target Purchased
Subsidiaries, (E) Hexalon may make dividend payments it is required to make
by the Code in order to maintain REIT status and those that are sufficient
to eliminate any Federal tax liability and (F) distributions may be
declared and paid to Target by the Target Subsidiaries necessary to fund
the Voting Trust Redemption;
(xiii) (A) settle or compromise any claim, litigation or other
legal proceeding, other than those wholly-covered by insurance or in the
ordinary course of business consistent with past practice in an amount not
involving more than $250,000 individually or $500,00 in the aggregate or
(B) pay, discharge or satisfy any other claims, liabilities or obligations
(absolute, accrued, asserted or unasserted, contingent or otherwise), other
than the payment, discharge or satisfaction of (x) any such other claims,
liabilities or obligations, in the ordinary course of business and
consistent with past practice, or (y) of any such other claims, liabilities
or obligations reflected or reserved against in, or contemplated by, the
consolidated financial statements (or the notes thereto) of Target;
(xiv) enter into or amend any agreements for the sale of the
Abbey Properties or the RoPro Assets;
(xv) take any actions which would result in any liability
arising under the Urban Tax Indemnification Agreement;
(xvi) permit any insurance policy naming Target, any Target
Subsidiary or any Target Non-Subsidiary Entity as a beneficiary or a loss
payable payee to be canceled or terminated without notice to Purchasers
unless such entity shall have obtained an insurance policy with
substantially similar terms and conditions to the canceled or terminated
policy; and
(xvii) agree to take any action prohibited by any of the
foregoing.
(c) Subject to SECTION 5.4, Target shall, shall cause each of the
Target Subsidiaries (other than the Joint Ventures) to, and shall use reasonable
efforts to cause each Target Non-Subsidiary Entity and the Joint Ventures to,
extinguish or repay any and all intercompany obligations (except for those
intercompany obligations to be (and which shall be) extinguished or repaid in
connection with the liquidations and distributions contemplated in order to make
the Distribution as required by the Protocol) prior to the Closing in a tax
efficient manner; PROVIDED, HOWEVER, that, without the prior written consent of
Purchasers, neither Target
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nor any Target Subsidiary shall take any action pursuant to this Section 5.1(c)
with respect to the extinguishment or repayment of an intercompany obligation if
a payment to a third party would be required to extinguish, or an increased tax
obligation of Target, any Target Subsidiary, Target Non-Subsidiary Entity or
Joint Venture would result from such extinguishing, of such intercompany
obligation.
SECTION 5.2. TAX RELATED COVENANTS
(a) Target will and shall cause Hexalon to continue to qualify
Hexalon as a REIT under the Code. Target shall comply with all requirements for
treatment as a BI under Article 28 of the Netherlands Corporate Income Tax Act
of 1969, as amended, through September 1, 2002.
(b) Target and the Target Subsidiaries shall cooperate with
Purchasers in taking all action reasonably requested by Purchasers and designed
to reduce any Assumed Taxes or other liabilities arising from or in connection
with the transactions contemplated by this Agreement and by the Transaction
Documents if and solely to the extent such actions do not impose any material
costs on Target or the Target Subsidiaries. Target shall confer with Purchasers
regarding any actions, elections or other steps relating to Taxes prior to
taking any actions materially affecting Taxes.
(c) On the date hereof Target obtained, and on the Closing Date
Target shall obtain a letter from Xxxxxx Xxxxxxxx, LLP in the form attached as
EXHIBIT B hereto with respect to all prior federal income tax returns of Hexalon
and the Pro Forma Tax Returns (the "XXXXXXXX LETTER").
(d) On the date hereof Target obtained, and on the Closing Date
Target shall obtain, an opinion of Loyens & Loeff in the form attached as
EXHIBIT C hereto (the "LOYENS TAX OPINION").
(e) The Target and the Target Subsidiaries will execute and deliver
written instructions to Xxxxxx, Golden & Xxxxxxx and Xxxxxx Xxxxxxxx, LLP
directing and authorizing them to cooperate with Purchasers and make their files
available to Purchaser while this Agreement is in effect and at all times
following the Closing.
(f) Target shall cause Xxxxxx Xxxxxxxx, LLP to prepare initial and
final pro forma, U.S. federal, state and local tax returns for all relevant
jurisdictions reflecting the liabilities of Target and its Subsidiaries for
Taxes (including, without limitation, withholding taxes under Section 1445 of
the Code) arising from or incident to the closing of the transactions (including
alternatively (i) a sale of the shares of Hexalon and (ii) a sale of the assets
of Hexalon and from the liquidation of Hexalon thereafter) as provided in this
Agreement (the "PRO FORMA TAX RETURNS"). The initial Pro Forma Tax Returns shall
assume a closing of the transactions as of March 31, 2002 at sale prices which
Purchasers shall provide to Xxxxxx Xxxxxxxx, LLP and the sale prices used for
the Closing and the final Pro Forma Tax Returns shall be based on the same
assumptions as to sales prices (subject, however, to any adjustments to sales
prices to reflect any price adjustments provided for in this Agreement and to
reflect the effect on the U.S. dollar equivalent price for the assets in the
event more, or fewer, U.S. dollar equivalents are
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payables for the assets relative to the U.S. dollar equivalents used for the
initial Pro Forma Tax Returns) except the closing date shall be the date the
Purchasers shall indicate as the approximate date of the Closing. The Pro Forma
Tax Returns shall disregard the results from operations other than for
depreciation and amortization deductions computed as of the Closing Date.
(g) The parties hereto shall report for Tax purposes consistently
with the sales prices reflected in the final Pro Forma Tax Returns.
SECTION 5.3. ACCESS TO INFORMATION; CONFIDENTIALITY.
(a) Target shall, shall cause each of the Target Subsidiaries to,
and shall use reasonable efforts to cause each Target Non-Subsidiary Entity to,
afford to Purchasers and their officers, employees, accountants, counsel,
financial advisors and other representatives (collectively, "PURCHASERS'
REPRESENTATIVES"), reasonable access during normal business hours and upon
reasonable advance notice during the period prior to the Closing to all its
properties, for the purpose of making surveys, inspections, engineering studies,
environmental assessments and other tests, examinations or studies which
Purchasers may deem necessary and for the purpose of inspecting all of the
books, contracts, commitments, personnel and records of Target, the Target
Subsidiaries and the Target Non-Subsidiary Entities and, during such period,
Target shall, and shall cause each of the Target Subsidiaries to, and shall use
reasonable efforts to cause each Target Non-Subsidiary Entity to, furnish
reasonably promptly to Purchasers all other information concerning its business,
properties and personnel as Purchasers may reasonably request. Target and its
officers, employees, accountants, counsel, financial advisors and other
representatives shall cooperate in all reasonable respects with each Purchaser
and its accountants in connection with the preparation and auditing in
accordance with Dutch GAAP of financial statements of Target and its
Subsidiaries on a consolidated basis and in connection with the preparation and
auditing in accordance with United States GAAP of financial statements relating
to any of the Target Properties, with respect to periods preceding the Closing
Date if such Purchaser has reasonably concluded that such audited financial
statements are necessary or appropriate in connection with its reporting
obligations under the United States Securities Exchange Act of 1934, as amended,
or Australian securities laws within four months after the Closing or in
connection with any debt or equity offering which may be proposed by such
Purchaser after the date hereof and within such four month period. Each
Purchaser will hold, and will cause its officers, employees, accountants,
counsel, financial advisors and other representatives and Affiliates to hold,
any nonpublic information in confidence to the extent required by, and in
accordance with, the provisions of (i) that certain letter agreement between
X.X. Xxxxxx Securities, Inc., on behalf of Target, and Hoosier, dated
October 15, 2001 (the "HOOSIER CONFIDENTIALITY AGREEMENT"), (ii) that certain
letter agreement, dated October 18, 2001, between X.X. Xxxxxx Securities, Inc.,
on behalf of Target, and Terrapin, and (iii) that certain letter agreement
between X.X. Xxxxxx Securities, Inc., on behalf of Target, and Westfield
Holdings Limited, dated January 10, 2002 (collectively, the "CONFIDENTIALITY
AGREEMENTS").
(b) In connection with any invasive or destructive testing of any
property (or any portion thereof) of Target, a Target Subsidiary or a Target
Non-Subsidiary Entity ("INVASIVE TESTING"), Purchasers shall (i) fully comply
with all laws, rules and regulations applicable to Target and/or the Invasive
Testing and all other activities undertaken in connection therewith, (ii) not
interfere materially with the use and occupancy of the property by Target and
the tenants
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under the leases, and (iii) permit Target to have a representative present
during all Invasive Testing undertaken hereunder. Purchasers hereby agrees to
indemnify, defend and hold harmless Target and Target's partners, and their
respective officers, directors, employees and agents from and against any and
all loss, cost, expense, damage, claim and liability suffered or incurred by
Target or any of such other entities or persons and arising out of Purchasers'
and/or Purchasers' Representatives Invasive Testing; PROVIDED, HOWEVER, that
such indemnity shall not apply to the mere discovery by Purchasers and/or
Purchasers' Representatives of any matters if the discovery thereof imposes
liability on Target or any other indemnified party.
SECTION 5.4. REASONABLE EFFORTS; NOTIFICATION.
(a) Upon the terms and subject to the conditions set forth in this
Agreement, each Purchaser Party, on the one hand, and Target on the other hand
agrees to use its reasonable best efforts to take, or cause to be taken, all
actions and to do, or cause to be done, and to assist and cooperate with the
other parties in doing, all things necessary, proper or advisable to fulfill all
conditions applicable to such party pursuant to this Agreement and to consummate
and make effective, in the most expeditious manner practicable, the transactions
contemplated by this Agreement and the Protocol (including the Distribution),
including (i) the obtaining of all necessary actions or nonactions, waivers,
consents and approvals from Governmental Entities and the making of all
necessary registrations and filings and the taking of all reasonable steps as
may be necessary to obtain an approval, waiver or exemption from any
Governmental Entity; (ii) the obtaining of all necessary consents, approvals,
waivers or exemptions from non-governmental third parties; and (iii) the
execution and delivery of any additional documents or instruments necessary to
consummate the transactions contemplated by this Agreement and the Protocol. In
addition, each of the parties hereto agrees to use its commercially reasonable
efforts to defend any lawsuits or legal proceedings, whether judicial or
administrative, challenging the Purchase or the other transactions contemplated
hereby. Target also shall cooperate with any reasonable request of Purchasers to
consummate the transactions contemplated hereby (i) through a conveyance of
other equity or real property interests of Target or a Target Subsidiary in
order to acquire indirectly the interests identified on Exhibit A hereto if and
to the extent such alternative transaction structure would facilitate the
obtaining of any Necessary Consent or render the obtaining of such consent (or
any other consent) unnecessary and/or (ii) in a tax efficient manner, including,
without limitation, where necessary to avoid Dutch withholding taxes or, when
requested, the termination of partnerships, including an admission by
contribution to certain partnerships of the Purchasers immediately prior to
Closing (with a right to redeem such contribution if the Closing does not occur
immediately thereafter), and, if requested by Purchasers deferred and reverse
like kind exchanges resulting in cash to the seller of the asset, which in no
event shall reduce the Purchase Price. Purchasers shall cooperate with any
reasonable request by Target to consummate the Purchase through the conveyance
of other equity or real property interests of Target or a Target Subsidiary in
order to acquire indirectly the interests specifically identified on Exhibit A
hereto if and to the extent such alternative transaction structure would
facilitate the obtaining of any Necessary Consent or render the obtaining of
such consent (or any other consent) unnecessary, provided that such alternative
transaction structure would not (i) diminish the economic benefits to the
Purchasers of the transactions contemplated hereby, (ii) impose any material
limitations or burdens on any Purchaser's (or any Purchaser Designee's)
ownership or operation of any Assets or
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(iii) adversely affect either the tax consequences that any Purchaser Party
would have from acquiring the interests specifically identified on Exhibit A or
the tax treatment of the Purchaser Parties.
(b) Target shall give prompt notice to Purchasers of (i) the
occurrence, or non-occurrence of any event whose occurrence, or non-occurrence
would be likely to cause any condition set forth herein to be unsatisfied in any
material respect at any time from the date hereof to the Closing and (ii) any
failure of Target or any of its officers, directors, employees or agents to
comply in any material respect with any covenant or agreement to be complied
with by it hereunder; provided, however, that the delivery of any notice
pursuant to this Section 5.4 shall not limit or otherwise affect the remedies
available hereunder to Purchasers.
SECTION 5.5. TAX RETURNS. Target and Purchasers shall cooperate in the
preparation, execution and filing of all returns, questionnaires, applications
or other documents regarding any Transfer and Gains Taxes applicable to the
Purchase. Target hereby assumes full responsibility for preparation and filing,
at Purchasers' sole expense, all Tax Returns of each Target Non-Purchased Entity
with respect to all Assumed Taxes which are required to be filed on or after the
Closing Date. Purchasers shall be given thirty (30) days to comment on such Tax
Returns prior to their filing and the returns shall be subject to the approval
of Purchasers, not to be unreasonably withheld.
SECTION 5.6. SECTION 754 OR OTHER ELECTIONS. At the request of
Purchasers, with respect to any partnership in which a Target Subsidiary has a
direct or indirect interest that has not made an election under Section 754 of
the Code (a "SECTION 754 ELECTION") or other election, Purchasers and Target
shall use their reasonable best efforts to cause each such partnership as
designated by Purchasers to file a Section 754 Election with the partnership's
federal income Tax Return for the taxable year of the partnership that ends on
or includes the Closing Date or make any other tax elections under the Code. At
the request of Purchasers, Target and Target Subsidiaries will cooperate in
making elective classification elections with respect to any Target Subsidiary
under the pertinent U.S. Treasury regulations.
SECTION 5.7. EMPLOYEE ARRANGEMENTS.
(a) EMPLOYMENT AND CHANGE OF CONTROL ARRANGEMENTS. As of the Closing
Date, the Parent Entities shall assume, honor and perform in accordance with
their terms all employment, severance, change of control and other such
agreements of Target and any Target Subsidiary identified in Section 5.7(a) of
the Target Disclosure Letter. Without limiting the foregoing, the Parent
Entities shall pay or cause to be paid at Closing to the employees identified on
Section 5.7 of the Target Disclosure Letter (the "KEY EMPLOYEES") the amounts
due to each such Key Employee pursuant to the terms of each such Key Employee's
employment agreement, an estimate of each such amount is set forth on
Section 5.7 of the Target Disclosure Letter. The Parent Entities further agree
that all Non-Covered Employees who are terminated without cause within twelve
months following the Closing Date and who execute a general release of claims in
a form satisfactory to the Parent Entities shall be entitled to receive
severance compensation equal to the greater of (subject to the proviso set forth
below) (i) two weeks of such employee's base salary and (ii) the greater of (A)
two weeks of such employee's base salary (the "SEVERANCE BASE") for each full
year of combined service with Target, a Target Subsidiary (including any
predecessor thereof) and the Parent Entities and, for any partial year of such
service, a pro rata
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amount of such employee's Severance Base based on the number of whole months
elapsed in such partial year divided by 12 or (B) in the event that the
Non-Covered Employee has at least 15 years of such service, one year of such
employee's base salary; PROVIDED, HOWEVER, that under no circumstances will such
employee be entitled to receive greater than one year of such employee's base
salary (the "SEVERANCE PAYMENT"). It is understood and agreed that the Severance
Payment to Non-Covered Employees and the payments to the employees identified on
Section 5.7 of the Target Disclosure Letter shall be in lieu of any other
severance benefits (except as required by applicable law) that any such employee
is entitled to receive and will be applied against any liability of the Parent
Entities which may arise under the Worker Adjustment and Retaining Notification
Act ("WARN"). If the Parent Entities determine that liability under WARN could
arise as a result of employment terminations, Target will cooperate reasonably
with the Parent Entities in connection with the delivery of WARN notices to
affected employees prior to the Closing Date.
(b) BENEFIT PLANS. Upon and after the Closing Date, each Parent
Entity shall allow employees of Target who become employees of such Parent
Entity to participate in employee benefit plans of such Parent Entity which are
made available generally to similarly situated employees of such Parent Entity.
With respect to any such plan which is an "employee benefit plan" as defined in
Section 3(3) of ERISA and any other service based benefits (including vacations)
in which the employees of Target may participate, solely for purposes of
determining eligibility to participate, vesting and entitlement to benefits but
not for purposes of accrual of benefits (except in the case of accrued vacation,
sick or personal time), service with Target or any Target Subsidiary shall be
treated as service with such Parent Entity; PROVIDED, HOWEVER, that such service
shall not be recognized to the extent that such recognition would result in a
duplication of benefits under both a Target Employee Benefit Plan and a benefit
plan of such Parent Entity (or is not otherwise recognized for such purposes
under the benefit plans of such Parent Entity). Without limiting the foregoing,
the Parent Entities shall not treat any Target employee as a "new" employee for
purposes of any pre-existing condition exclusions, waiting periods, evidence of
insurability requirements or similar provision under any health or other welfare
plan, and will make appropriate arrangements with its insurance carrier(s), to
the extent applicable, to ensure such result.
(c) Nothing in this Agreement shall preclude the Parent Entities,
Target or any Target Subsidiary from terminating the employment of any employee
of Target or any Target Subsidiaries at any time on or after the Closing Date.
(d) Prior to the Closing Date, Target will take all actions
necessary to:
(i) cause each outstanding stock appreciation right ("SAR")
granted under the Urban Shopping Centers 2001 Stock Appreciation Rights
Plan (the "2001 SAR PLAN") to be cancelled on the Closing Date, and in full
satisfaction of such cancellation each holder thereof shall be entitled to
receive on the Closing Date in exchange, with respect to each SAR, an
amount equal to the Per Share Consideration less the Exercise Price (as
defined in the 2001 SAR Plan) multiplied by the number of Covered Shares
(as defined in the SAR Agreement evidencing the SAR) to which such SAR
relates;
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(ii) cause all Restricted Stock (as that term is defined under
the Urban Shopping Centers 2001 Incentive Program (the "2001 INCENTIVE
PROGRAM")) granted under the 2001 Incentive Program (it being acknowledged
by the parties that the transactions contemplated by this Agreement shall
cause all Restricted Stock to become immediately vested in full) to be
cancelled on the Closing Date, and in full satisfaction of such
cancellation each holder thereof shall be entitled to receive in exchange a
cash payment on the Closing Date equal to the product of his or her shares
of Restricted Stock multiplied by the Per Share Consideration;
(iii) cause each outstanding share of Earned Incentive Stock (as
that term is defined in the 2001 Incentive Program) granted under the 2001
Incentive Program (it being acknowledged by the parties that all shares of
Incentive Stock eligible to be earned during the 2001 Program Year (as
provided in Section 4.1 of the 2001 Incentive Program) shall be deemed to
be Earned Incentive Stock) to be cancelled on the Closing Date, and in full
satisfaction of such cancellation each holder thereof shall be entitled to
receive a cash payment on the Closing Date equal to the product of his or
her shares of Earned Incentive Stock multiplied by the Per Share
Consideration;
(iv) cause all Incentive Stock (as such term is defined under
the 2001 Incentive Program) granted under the 2001 Incentive Program that
is not Earned Incentive Stock (i.e., Incentive Stock eligible to earned in
the 2002, 2003 and 2004 Program Years) or deemed to be Earned Incentive
Stock for purposes of this Agreement to be forfeited on the Closing Date;
and
(v) cause each of the 2001 SAR Plan and the 2001 Incentive Plan
to be terminated.
SECTION 5.8. NO SOLICITATION OF ACQUISITION PROPOSALS. Target shall not,
and it shall cause its Subsidiaries and the officers, directors, employees,
agents and representatives of Target and its Subsidiaries (collectively, the
"TARGET REPRESENTATIVES") not to, (i) solicit or encourage, directly or
indirectly, the making of any Acquisition Proposal, (ii) initiate any discussion
or engage in negotiations with or provide any information to any entity relating
to an Acquisition Proposal, or take any other action to knowingly facilitate the
making of any proposal that constitutes, or may reasonably be expected to lead
to, any Acquisition Proposal, or (iii) endorse or enter into any Acquisition
Proposal or modify or withdraw its recommendation of the Purchase. Except as
permitted by SECTION 5.8 hereof, Target and the Target Representatives will
immediately cease and cause to be terminated any existing activities,
discussions or negotiations with any Third Parties conducted heretofore with
respect to any Acquisition Proposal. Notwithstanding the foregoing, Target may
engage in discussions or provide information with respect to an unsolicited bona
fide written Acquisition Proposal if (i) Target and the Supervisory Board of
Target conclude in good faith that such Acquisition Proposal is reasonably
likely to result in a Superior Proposal (as hereinafter defined), (ii) prior to
providing any information to any Person in connection with an Acquisition
Proposal by any such Person, Target receives from such Person an executed
confidentiality agreement on terms substantially similar to, and no less
restrictive to such Person than those contained in the Hoosier Confidentiality
Agreement and (iii) prior to providing any information to any Person or entering
into discussions with any Person, Target notifies Purchasers promptly of such
Acquisition Proposal or negotiations, including the
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name of such Person and the material terms and conditions of such Acquisition
Proposal (including a copy of any written proposal and any written
documentation). Target shall notify Purchasers promptly, but in any event within
24 hours, of any Acquisition Proposal or any inquiry with respect to or which
could reasonably be expected to lead to an Acquisition Proposal received by any
Target or the Target Representatives, the terms and conditions of such proposal
(including a copy of any written proposal and any written documentation) and the
identity of the Person making the proposal or offer or inquiry. Target will
promptly notify Purchasers of any material change in the status and details of
any such Acquisition Proposal or inquiry. Target will promptly provide to
Purchasers any non-public information concerning Target or its Subsidiaries
provided to any other Person which was not previously provided to Purchasers. In
addition, Target and the Supervisory Board of Target may withdraw or modify
their recommendation of the Purchase or approve a Superior Proposal and enter
into an agreement with respect thereto if (x) a Superior Proposal is pending,
(y) Target has provided Purchasers with notice that it has received a Superior
Proposal which it intends to accept (specifying the offeror and the material
terms and conditions of such Superior Proposal) and (if requested by Purchasers)
has negotiated in good faith with Purchasers during the three (3) Business Days
following Purchasers' receipt of such notice to attempt to make such adjustments
to this Agreement as would enable Target and Purchasers to proceed with the
Purchase on such adjusted terms and (z) this Agreement is terminated in
connection with such Superior Proposal and the Break-Up Fee is paid. "SUPERIOR
PROPOSAL" means an unsolicited bona fide written proposal by a Third Party to
acquire all or substantially all of the Assets (i) on terms which the
Supervisory Board determines in good faith (after consultation with its
financial advisors and legal counsel) to be more favorable from a financial
point of view to the shareholders of Target than the terms contemplated by this
Agreement, (ii) is not conditioned upon obtaining financing not fully committed
at such time and (iii) which is reasonably capable of being consummated without
undue delay in the good faith judgment of the Supervisory Board of Target.
"ACQUISITION PROPOSAL" means any inquiry, proposal or offer, whether in writing
or otherwise, from a Third Party to acquire beneficial ownership of all or more
than 20% of the assets of Target and the Target Subsidiaries, taken as a whole,
or 20% or more of any class of equity securities of Target or of any Target
Subsidiary which owns, directly or indirectly, more than 50% of the Assets
pursuant to a merger, consolidation or other business combination, sale of
shares of capital stock, sale of assets, tender offer, exchange offer or similar
transaction with respect to either Target or any such Target Subsidiary,
including any single or multi-step transaction or series of related
transactions, which is structured to permit such Third Party to acquire
beneficial ownership of more than 20% of the assets of Target and the Target
Subsidiaries, taken as a whole, or 20% or more of any class of equity securities
of Target or any Target Subsidiary which owns, directly or indirectly, more than
50% of the Assets.
SECTION 5.9. PUBLIC ANNOUNCEMENTS. Target, on the one hand, and the
Purchaser Parties, collectively, on the other hand, shall consult with each
other before issuing any press release with respect to this Agreement or any of
the transactions contemplated by this Agreement and shall not issue any such
press release without having first provided a copy of any such press release to
Target, on the one hand, or the Purchaser Parties, on the other hand, as the
case may be.
SECTION 5.10. AGREEMENTS REGARDING THE DISPOSAL OF PROPERTIES. At the
direction of Purchasers, Target shall cause each applicable Target Subsidiary to
enter into an agreement, in
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form and substance reasonably acceptable to Purchasers (each a "DISPOSAL
AGREEMENT"), to sell the properties identified in Section 5.10 of the Target
Disclosure Letter (each a "DISPOSAL PROPERTY") to one or more parties as may be
designated by Purchasers. Under each such Disposal Agreement, the sale of the
Disposal Property will be scheduled to close (with "time being of the essence"
with respect to such closing) prior to the Closing of the Purchase or at such
date after the Closing as Purchasers may agree. Target shall, and shall cause
the applicable Target Subsidiaries to, use its and their reasonable best efforts
to consummate the sale of each Disposal Property in accordance with the terms
and conditions of the applicable Disposal Agreement; PROVIDED, HOWEVER, that the
proceeds received by Target or a Target Subsidiary in consideration for the
disposition of any Disposal Property (i) shall not be less than the minimum
price set forth for such Disposal Property in Section 5.10 of the Target
Disclosure Letter and (ii) shall be used by Target to pay existing indebtedness;
and PROVIDED, FURTHER, that, with respect to the 745 Property, such Disposal
Agreement shall provide that (i) such applicable Target Subsidiary shall not be
obligated to consummate such sale unless the Purchase will be consummated
immediately thereafter and (ii) in the event this Agreement is terminated in
accordance with ARTICLE VIII such Target Subsidiary shall have the right to
terminate such Disposal Agreement without any cost, penalty or liability
thereto. Target shall cooperate with Purchasers in the negotiation and
consummation of any Disposal Agreement, including, without limitation, granting
any potential buyer permission to conduct usual and customary due diligence in
connection with such sale. Each applicable Target Subsidiary shall enter into
any Disposal Agreement as Purchasers shall in good faith direct. Purchasers
shall indemnify and hold the applicable Target Subsidiary harmless from any
liability in connection with any such Disposal Agreement. Neither Target nor any
Target Subsidiary shall take any action it is entitled to take under, or
relating to, any such Disposal Agreement, or exercise any remedy in connection
with any such Disposal Agreement, without the prior written consent of
Purchasers and, upon the instruction of Purchasers, Target and any Target
Subsidiary shall promptly take such action and/or exercise any remedy in
connection with any such Disposal Agreement as Purchasers shall direct (provided
that such action or remedy is permitted or provided for under the applicable
Disposal Agreement). At the closing of the transaction contemplated by a
Disposal Agreement, Target and any Target Subsidiary shall deliver to the
purchaser thereunder all documents, agreements, instruments and Necessary
Consents described in SECTION 2.5 which are applicable thereto (including,
without limitation, instruments sufficient to convey the Target Tangible
Personal Property associated with such Target Property).
SECTION 5.11. INDEMNIFICATION; DIRECTORS' AND OFFICERS' INSURANCE.
(a) It is understood and agreed that, subject to the limitations on
indemnification under applicable law, Hoosier and Terrapin (the "INDEMNIFYING
PARTIES") shall, to the fullest extent permitted under applicable law, indemnify
and hold harmless, for a period of six years following the Closing, (i) each
present and former managing or supervisory director, officer and employee of the
Target or any Target Subsidiary against any costs or expenses (including
reasonable attorneys' fees), judgments, fines, losses, claims, damages,
liabilities and amounts paid in settlement in connection with any claim, action,
suit, proceeding or investigation (collectively, "LOSSES") arising out of any
action taken or omission occurring at or prior to the Closing Date and (ii) each
present and former managing or supervisory director, officer and employee of any
Target Non-Purchased Entity (together with the persons with indemnification
rights pursuant to clause (i) above, collectively, the "INDEMNIFIED PARTIES")
against any Losses
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arising out of his or her good faith actions in connection with the distribution
of the Purchase Price to Target's shareholders in accordance with the terms and
conditions of the Protocol; PROVIDED, that the Indemnifying Parties shall not be
liable for any settlement effected without their prior written consent (which
consent shall not be unreasonably withheld). In connection therewith, (A) the
Indemnifying Parties shall promptly pay expenses in advance of the final
disposition of any claim, suit, proceeding or investigation to each Indemnified
Party to the full extent permitted by law, subject to the provision by such
Indemnified Party of an undertaking to reimburse the amounts so advanced in the
event of a final non-appealable determination by a court of competent
jurisdiction that such Indemnified Party is not entitled to such amounts, and
(B) the Indemnified Parties may retain one counsel satisfactory to them (except
in case of a conflict of interest among two or more Indemnified Parties, in
which case more than one counsel may be retained), and the Indemnifying Parties
shall promptly pay all reasonable fees and expenses of such counsel for the
Indemnified Parties. Any Indemnified Party wishing to claim indemnification
under this SECTION 5.11, upon learning of any such claim, action, suit, demand,
proceeding or investigation, shall notify the Indemnifying Parties; PROVIDED,
that the failure to so notify shall not affect the obligations of the
Indemnifying Parties except to the extent such failure to notify materially
prejudices such parties.
(b) For a period of six years after the Closing Date, the
Indemnifying Parties will maintain in effect the existing directors' and
officers' liability insurance covering the Indemnified Parties who are currently
covered by Target's and the Target Subsidiaries' officers and directors
liability insurance policies (copies of which policies have been provided to
Purchasers) on terms not less favorable than those in effect on the date hereof
in terms of coverage and amounts and which provide coverage as to claims arising
out of the good faith actions of such Indemnified Persons in connection with the
distribution of the Purchase Price to Target's shareholders in accordance with
the terms and conditions of the Protocol; PROVIDED, HOWEVER, that if the
aggregate annual premiums for such insurance at any time during such period
exceed the per annum rate of premium paid by Target for such insurance as of the
date of this Agreement, then the Indemnifying Parties shall provide the maximum
coverage that will then be available at an annual premium equal to 175% of such
per annum rate as of the date of this Agreement.
(c) This SECTION 5.11 is intended for the irrevocable benefit of,
and to grant third party rights to, the Indemnified Parties and shall be binding
on all successors and assigns of the Indemnifying Parties. Each of the
Indemnified Parties shall be entitled to enforce the covenants contained in this
SECTION 5.11.
(d) In the event that any of Purchasers or any of its successors or
assigns (i) consolidates with or merges into any other person or entity and
shall not be the continuing or surviving entity of such consolidation or merger
or (ii) transfers or conveys a majority of its properties and assets to any
person or entity, then, and in each such case, proper provision shall be made so
that the successors, assigns and transferees of such Indemnifying Party assume
the obligations set forth in this SECTION 5.11.
(e) To the extent permitted by law, all rights of indemnification
for the benefit of any Indemnified Party shall be mandatory rather than
permissive.
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(f) The liabilities and obligations assumed by the Indemnifying
Parties under this SECTION 5.11(a)-(e) are referred to herein as the "H&T
ASSUMED LIABILITIES". Following the Closing, Purchasers shall indemnify and hold
harmless each Target Non-Purchased Entity against any claims arising in respect
of the Non-Financial Covenants.
SECTION 5.12. SHAREHOLDERS' MEETING
(a) Target shall as promptly as practicable duly call, give notice
of and take all other action necessary in accordance with applicable law to
convene, and hold a meeting of its shareholders (the "SHAREHOLDERS MEETING") for
the purpose of obtaining the affirmative vote of holders of Ordinary Shares of
Target casting at least two-thirds of the votes cast and excluding all Ordinary
Shares, if any, owned by the Voting Trust (i) to approve the Purchase, (ii) to
approve the Distribution, conditioned only upon the Closing, (iii) to appoint at
Closing one person designated by Westfield Limited (the "WESTFIELD DESIGNEE") to
the Board of Liquidators, PROVIDED that Target shall have the right to object to
the Westfield Designee on a reasonable basis, PROVIDED, FURTHER, that if no
Westfield Designee is appointed to the Board of Liquidators at Closing (due to
the failure of the Westfield Designee to obtain the required approval of the
Dutch Central Bank, as a result of the objection by Target or otherwise), the
Board of Liquidators shall consult with Westfield Limited on a reasonable basis
on matters related to, or in connection with, the Distribution, PROVIDED,
FURTHER, that Target shall have no obligation pursuant to this clause (iii) if
Westfield Limited transfers all of its equity ownership in Target to an
unaffiliated third party, and (iv) to appoint the members of the Management
Board as liquidators to carry out the Distribution in accordance with the
Protocol, and shall take all lawful action to solicit the approval of such
transactions by such vote. The Management Board and the Supervisory Board of
Target shall recommend that holders of Ordinary Shares vote in favor of such
resolutions. Subject to SECTION 5.8, the Supervisory Board shall not withdraw or
modify in a manner adverse to Purchasers its recommendation of the resolutions.
Target agrees that it will not cancel, postpone or adjourn the date of the
Shareholders Meeting or change the items on the agenda without the agreement of
Purchasers.
(b) As promptly as reasonably practicable after the date of this
Agreement, Target shall prepare a shareholder circular relating to the matters
to be submitted to the shareholders of Target at the Shareholders Meeting.
Target shall provide Purchasers with a reasonable opportunity to review and
comment on the shareholder circular, and on any amendment or supplement thereto,
and shall not distribute the shareholder circular, or any amendment or
supplement thereto, to its shareholders prior to the approval of such document
by the Purchasers, which approval shall not be unreasonably withheld or delayed.
The shareholder circular shall comply as to form in all material respects with
the applicable provisions of applicable law. Each Purchaser shall furnish all
information concerning itself and its Affiliates which is required or customary
for inclusion therein. If at any time prior to the Shareholders Meeting any
information relating to Target or Purchasers, or any of their respective
Affiliates, officers or directors, should be discovered by Target or Purchasers
which should be set forth in an amendment or supplement to the shareholder
circular so that such document would not include any misstatement of a material
fact or omit to state any material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, the party which discovers such information shall promptly notify the
other party and,
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to the extent required by law, rules or regulations, an appropriate amendment or
supplement describing such information shall be promptly and disseminated to the
shareholders of Target.
SECTION 5.13. VOTING TRUST. Target hereby agrees to take all necessary and
appropriate actions to implement the Voting Trust Redemption at Closing at a
price not to exceed (i) the original issue price of such Ordinary Shares PLUS
(ii) accrued and unpaid interest thereon PLUS (iii) related financing and
administrative costs in an amount not to exceed $7,500,000. Target shall take
all necessary and appropriate actions to procure that the Agreement Regarding
the Acquisition of Shares in Target, dated September 23, 2001, be terminated at
Closing and thereafter shall be of no further force and effect.
SECTION 5.14. FUNDING OF PURCHASE PRICE. The Parent Entities shall cause
the Purchasers to fulfill their obligations hereunder to consummate the Purchase
in accordance with the terms and conditions of this Agreement, including by
funding the Purchasers with an amount of cash necessary to permit the payment of
the Purchase Price by the Purchasers at Closing in accordance with ARTICLE II
hereof. For avoidance of doubt, this SECTION 5.14 shall terminate as of the
Closing.
SECTION 5.15. OFFICERS AND DIRECTORS. Upon the written request of
Purchasers, (i) Target shall cause any or all of the directors (or persons
occupying similar positions in any limited liability company or other entity)
and/or officers of each direct or indirect wholly owned Target Subsidiary
(excluding any Target Non-Purchased Entity) to resign or be removed or, as to
officers, to be terminated, effective as of the Closing, and (ii) if Target or
any of its affiliated entities has the right to appoint any director (or person
occupying a similar position in any limited liability company or other entity)
or to cause the resignation or termination of any officer of any other entity in
which Target (directly or indirectly) owns an equity interest (excluding any
Target Non-Purchased Entity), Target shall cause, effective as of the Closing,
such director to resign or to be removed and/or such officer to resign or be
terminated.
SECTION 5.16. URBAN RETAIL PROPERTIES. Target shall cause to be delivered
to Purchasers at Closing, directly or indirectly, all outstanding equity
interests in Urban Retail Properties, Co. Such equity interests shall be an
Asset hereunder and shall be delivered to the Purchaser Parties for no
additional consideration and shall be obtained by Target for no consideration
other than the cancellation of the promissory note, dated November 8, 2000,
issued by Xxxxxxx Xxxxxxx in favor of Novi Mall Associates.
ARTICLE VI
TAX MATTERS
SECTION 6.1. ASSUMPTION OF TAXES. Subject to SECTION 7.1, Purchasers
shall each assume joint and several liability for all Taxes (whether fixed or
contingent) of each Target Non-Purchased Entity (including, without limitation,
any liability for income Taxes of any such party and any liability for Transfer
and Gains Taxes resulting from the consummation of the transactions contemplated
by the Transaction Documents incurred or payable on, before, or after the
Closing Date (collectively, the "ASSUMED TAXES")); PROVIDED, HOWEVER, that no
Purchaser Party shall assume (i) liability for any Taxes arising from any
actions or omissions of Target or
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the Target Non-Purchased Entities occurring after the Closing Date (other than
for taxes payable to any U.S. taxing authority in connection with the
liquidation of Hexalon), (ii) any liability that any such party may have for
another Person's Taxes, other than the Urban Tax Indemnification Agreement and
the Tax Protection Agreement(s) disclosed in Section 3.14(h) of the Target
Disclosure Letter, or (iii) any Taxes imposed by any Dutch Governmental Entity
in respect of the transactions contemplated by this Agreement, the Protocol or
arising after the Closing (collectively, the "EXCLUDED TAXES").
SECTION 6.2. INDEMNIFICATION. Purchasers shall on a joint and several
basis indemnify and hold harmless each Target Non-Purchased Entity and any
shareholder, director, officer, or employee of a Target Non Purchased Entity for
all Assumed Taxes.
SECTION 6.3. TAX CONTESTS. Target hereby grants Purchasers full authority
to assume full and primary responsibility to contest, at their sole discretion
and expense, any matter relating to the Assumed Taxes and shall indemnify each
Target Non-Purchased Entity, and all shareholders, directors, officers, and
employees of Target Non-Purchased Entities from any costs that such parties may
incur in defending or participating in such contests.
SECTION 6.4. TAX REFUNDS. Purchaser shall be entitled to all refunds for
Assumed Taxes otherwise payable to Target or a Target Non-Purchased Entity.
SECTION 6.5. WITHHOLDING CERTIFICATES. Neither Purchasers nor any of
their respective agents shall be entitled to deduct and withhold from the
Purchase Price otherwise payable pursuant to this Agreement to Target and/or any
Target Subsidiary and/or any Target Non-Subsidiary Entity and/or any Target
Non-Purchased Entity any amounts under Section 1445 of the Code; PROVIDED,
HOWEVER, Target and/or any Target Subsidiary and/or any Target Non-Subsidiary
Entity and/or any Target Non-Purchased Entity shall each apply for and obtain a
reduced withholding certificate under the appropriate Treasury Regulations under
Section 1445 of the Code from the IRS on or before the Closing Date (including,
without limitation, a reduced withholding certificate in connection with the
liquidation of Hexalon) and to the extent any of them provides Purchasers a
notice that complies with Treasury Regulation section 1.1445-1(c)(2)(i)(B),
Purchasers shall not pay over the withheld amounts to the IRS but will
contribute such amounts to an escrow account established for the benefit of
Purchasers in form reasonably satisfactory to Purchasers, including such terms
as are necessary to allow Hexalon to maintain its REIT status during the term of
the escrow. Any amounts paid in lieu of the amounts withheld and paid to the IRS
shall be treated by the parties for all tax reporting purposes as paid to Target
for the Australian Interests. The Purchasers shall be entitled to claim refunds
in respect of any Taxes paid by Purchasers and such refunds shall belong to
Purchasers. Target shall cooperate, and Target shall cause the other Target
Non-Purchased Entities to cooperate, with Purchasers in seeking any such
refunds.
ARTICLE VII
CONDITIONS TO CLOSING
SECTION 7.1. CONDITIONS TO OBLIGATIONS OF PURCHASERS. The obligations of
Purchasers to consummate the transactions contemplated by this Agreement shall
be subject to
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the fulfillment, at or prior to the Closing, of each of the following conditions
unless waived by Purchasers:
(a) TARGET SHAREHOLDER APPROVAL. The Purchase and the Distribution
shall have been duly approved and adopted at the Shareholders Meeting by the
affirmative vote of the holders of Ordinary Shares of Target casting at least
two-thirds of the votes cast excluding all Ordinary Shares, if any, beneficially
owned by the Voting Trust (the "TARGET SHAREHOLDER APPROVAL");
(b) DISTRIBUTION. The amount per Ordinary Share (without regard to
the Ordinary Shares held by the Voting Trust) to be distributed by Target to its
shareholders pursuant to the Distribution shall not be less than EURO 53 (prior
to giving effect to any withholding tax to be withheld by Target under Dutch
law) and the Distribution shall be imminent (assuming payment by Purchasers of
the Purchase Price);
(c) NO PROCEEDINGS. No claim, suit, action or other proceeding
arising out of the transactions contemplated hereby has been brought (and
remains pending) by a Governmental Entity or any third party (other than a
Purchaser Party or an Affiliate or Subsidiary of a Purchaser Party (excluding
Target and any Target Subsidiary)):
(i) that is reasonably likely to (A) prohibit or impose any
material limitations on any Parent Entity's (or any of its respective
Subsidiary's or Affiliate's) ownership or operation of all or a material
portion of (1) the Assets or (2) the business or assets of such Parent
Entity and its respective Subsidiaries and Affiliates, taken as a whole, or
(B) compel any Parent Entity or Target or any of their respective
Subsidiaries or Affiliates, as the case may be, to dispose of or hold
separate any material portion of (1) the Assets or (2) the business or
assets of such Parent Entity and its respective Subsidiaries and
Affiliates, taken as a whole;
(ii) that is reasonably likely to restrain or prohibit the
Closing or the performance of any transaction contemplated by the
Transaction Documents, or is reasonably likely to obtain from Target or the
Purchaser Parties any damages that are material in relation to Target or
the Target Subsidiaries taken as a whole, or
(iii) which otherwise is reasonably likely to have a material
adverse affect on the consolidated financial condition, businesses or
results of operations of any of the Parent Entities.
(d) NO LEGAL RESTRAINTS. No Governmental Entity shall have enacted,
issued, promulgated, enforced or entered any law, rule, regulation, executive
order, decree, restraining order, injunction or other order (whether temporary,
preliminary or permanent) or other legal or regulatory restraint which is then
in effect (which order or other action the parties hereto shall use their
reasonable best efforts to vacate or lift) and which prohibits or precludes the
consummation of the Purchase;
(e) CONSENTS. All consents and waivers identified on Section 7.1(d) of
the Target Disclosure Letter shall have been obtained (the "NECESSARY
CONSENTS");
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(f) HSR ACT, ETC. Any waiting period applicable to the consummation
of the Purchase under the HSR Act shall have expired or been terminated; any
required approval of the Purchase by the European Commission pursuant to the EC
Merger Regulations shall have been obtained;
(g) REPRESENTATIONS, WARRANTIES. All representations and warranties
of Target contained in this Agreement (without giving effect to any materiality
or similar qualifications) shall be true and correct as of the Closing (except
to the extent that any such representation or warranty, by its terms, is
expressly limited to a specific date, in which case such representation or
warranty shall be true and correct as of such date), except where the failure to
be so true and correct would not reasonably be expected to result, individually
or in the aggregate, in a Target Material Adverse Effect;
(h) PERFORMANCE OF COVENANTS. All the agreements contained in this
Agreement to be performed by Target on or before the Closing Date shall have
been performed in all material respects;
(i) NO TARGET MATERIAL ADVERSE EFFECT. Since the date of this
Agreement, there shall not have occurred any event, change, effect or
development that, individually or in the aggregate with any other event, change,
effect or development since the date of this Agreement, which has had or would
reasonably be expected to have a Target Material Adverse Effect, provided, that
for purposes of this Section 7.1(h) only, each Target Non-Subsidiary Entity
shall be deemed to be a Target Subsidiary;
(j) TAX DELIVERIES. Purchasers shall have received the Loyens Tax
Opinion and the Xxxxxxxx Letter to be delivered at Closing pursuant to
Section 5.2 and all applicable withholding certificates approved by the IRS as
required by Section 6.5; and
(k) FINAL PRO FORMA TAX RETURNS. The final Pro Forma Tax Returns
delivered to Purchasers pursuant to Section 5.2(f) shall reflect no aggregate
liability for Taxes (including, without limitation, any withholding taxes
reflected in the IRS withholding certificates required by Section 6.5) other
than (i) Excluded Taxes, (ii) Transfer and Gain Taxes not exceeding $15,000,000
in the aggregate and (iii) other Taxes in an aggregate amount not exceeding
$3,000,000.
SECTION 7.2. CONDITIONS TO OBLIGATIONS OF TARGET. The obligations of
Target to consummate the transactions contemplated by this Agreement shall be
subject to the fulfillment, at or prior to the Closing, of each of the following
conditions unless waived by Target:
(a) TARGET SHAREHOLDER APPROVAL. The Purchase and the Distribution
shall have been duly approved and adopted at the Shareholders Meeting by the
affirmative vote of the holders of Ordinary Shares of Target casting at least
two-thirds of the votes cast excluding all Ordinary Shares, if any, beneficially
owned by the Voting Trust;
(b) DISTRIBUTION. Subject to Section 8.1(k), the amount per Ordinary
Share (without regard to the Ordinary Shares held by the Voting Trust) to be
distributed by Target to its shareholders pursuant to the Distribution shall not
be less than the Target Minimum Amount;
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(c) NO LEGAL RESTRAINTS. No Governmental Entity shall have enacted,
issued, promulgated, enforced or entered any law, rule, regulation, executive
order, decree, restraining order, injunction or other order (whether temporary,
preliminary or permanent) or other legal or regulatory restraint which is then
in effect (which order or other action the parties hereto shall use their
reasonable best efforts to vacate or lift) and which prohibits or precludes the
consummation of the Purchase;
(d) HSR ACT, ETC. Any waiting period applicable to the consummation
of the Purchase under the HSR Act shall have expired or been terminated; any
required approval of the Purchase by the European Commission pursuant to the EC
Merger Regulations shall have been obtained;
(e) REPRESENTATIONS, WARRANTIES. All representations and warranties
of the Purchaser Parties contained in this Agreement (without giving effect to
any materiality or similar qualifications) shall be true and correct as of the
Closing (except to the extent that any such representation or warranty, by its
terms, is expressly limited to a specific date, in which case such
representation or warranty shall be true and correct as of such date), except
where the failure to be so true and correct would not reasonably be expected to
have a material adverse effect on Purchasers' ability to complete the Purchase;
or
(f) PERFORMANCE OF COVENANTS. All the agreements contained in this
Agreement to be performed by the Purchaser Parties on or before the Closing Date
shall have been performed in all material respects.
ARTICLE VIII
TERMINATION
SECTION 8.1. TERMINATION. This Agreement may be terminated and the
transactions contemplated hereby may be abandoned at any time prior to the
Closing (notwithstanding any approval of the Purchase or any of the other
transactions contemplated by this Agreement by the shareholders of Target):
(a) by mutual written consent of Target and Purchasers;
(b) by Target or Purchasers if any Governmental Entity shall have
issued an order, decree or ruling or taken any other action permanently
enjoining, restraining or otherwise prohibiting the Purchase and such order,
decree or ruling or other action shall have become final and non-appealable;
PROVIDED, that the party seeking to terminate this Agreement pursuant to this
clause (b) shall have used reasonable best efforts to remove such order, decree,
ruling or judgment or to reverse such action;
(c) by Target if the Supervisory Board of Target elects to accept a
Superior Proposal; PROVIDED, that this Agreement may not be terminated under
this SECTION 8.1(c) unless Target has complied in all material respects with the
provisions of SECTION 5.8, including by notifying Purchasers in writing not less
than three (3) Business Days prior to taking such action of its intention to
take such action and during such three (3) Business Day period (if requested by
Purchasers) negotiating in good faith with Purchasers in an attempt to make
adjustments to this
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Agreement such that the Acquisition Proposal that the Supervisory Board was
prepared to accept is no longer a Superior Proposal; and PROVIDED, FURTHER, that
it shall be a condition to termination pursuant to this SECTION 8.1(c) that the
Target shall have made the payment of the Break-Up Fee to the Purchasers
required by SECTION 9.2.
(d) by Purchasers, if the Supervisory Board of Target approves or
recommends a Superior Proposal or the Supervisory Board withdraws or modifies
its recommendation of the Purchase in a manner adverse to Purchasers (or
resolves to take any of such actions);
(e) by Purchasers, if any of the following events shall occur and be
continuing or conditions exists: (i) any of the representations and warranties
of Target contained in this Agreement (without giving effect to any materiality
or similar qualifications) shall not be true and correct, in each case as of the
date of determination (except to the extent that any such representation or
warranty, by its terms, is expressly limited to a specific date, in which case
such representation or warranty shall not be true and correct as of such date),
in each case where such failure to be so true and correct would reasonably be
expected to result, individually or in the aggregate, in a Target Material
Adverse Effect; or (ii) Target shall have failed to perform in all material
respects any of its agreements contained in this Agreement required to be
performed at or prior to the date of determination (any such event or condition
described in this clause (ii), a "TERMINATING TARGET BREACH") and such
Terminating Target Breach (A) is not cured by Target within twenty (20) calendar
days after receipt of notice of the Terminating Target Breach or (B) is not
curable prior to July 15, 2002; or
(f) by Target, if any of the following events shall occur and be
continuing or conditions exists: (i) any of the representations and warranties
of the Purchaser Parties contained in this Agreement (without giving effect to
any materiality or similar qualifications) shall not be true and correct, in
each case as of the date of determination (except to the extent that any such
representation or warranty, by its terms, is expressly limited to a specific
date, in which case such representation or warranty shall not be true and
correct as of such date), in each case where such failure to be so true and
correct would reasonably be expected to have a material adverse effect on
Purchasers' ability to complete the Purchase; or (ii) the Purchaser Parties
shall have failed to perform in all material respects any of their agreements
contained in this Agreement required to be performed at or prior to the date of
determination (any such event or condition described in this cause (ii), a
"TERMINATING PURCHASERS BREACH") and such Terminating Purchasers Breach (A) is
not cured by the Purchaser Parties within twenty (20) calendar days after
receipt of notice of the Terminating Purchasers Breach or (B) is not curable
prior to July 15, 2002; or
(g) by Target or Purchasers, if the approval of the Purchase by the
shareholders of Target shall not have been obtained by reason of the failure to
obtain the requisite vote at a duly held meeting of shareholders of Target, or
at any adjournment thereof; or
(h) by Purchasers, if Target fails to perform in all material
respects any of its obligations contained in the Protocol; or
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(i) by Target, if any Purchaser Party fails to perform in all
material respects any of its obligations contained in the Protocol; or
(j) by Target or Purchasers, if the Closing shall not have occurred
on or prior to July 15, 2002 (the "TERMINATION DATE"); PROVIDED, HOWEVER, that
the right to terminate this Agreement under this SECTION 8.1(j) shall not be
available to any party whose failure to fulfill any obligation under this
Agreement (including without limitation SECTION 5.4(a)) has to any extent been
the cause of, or resulted in, the failure of the Closing to occur on or before
the Termination Date; or
(k) by Target, if the amount per Ordinary Share to be distributed by
Target to Target shareholders, in accordance with the Protocol, will be less
than EURO 53 (prior to giving effect to any withholding tax to be withheld by
Target under Dutch law and without regard to the Ordinary Shares held by the
Voting Trust) solely as a result of surtax tax imposed under Article IV. B.
Inroeringswet Inkomstenlselasting 2001 (the "TARGET MINIMUM AMOUNT") and if the
Supervisory Board of Target has given each Parent Entity written notice of
Target's election to terminate this Agreement pursuant to this Section 8.1(k)
and such notice describes in reasonable detail the reasons that the amount per
Ordinary Share to be distributed will be less than EURO 53; PROVIDED, HOWEVER,
that the Parent Entities may, at their sole option, either: (i) nullify such
election to terminate by giving written notice to the Supervisory Board of
Target, within five Business Days after all of the Parent Entities have received
Target's notice, that the Parent Entities will agree to a delay in the
distribution of a portion of the amount to be distributed to Target shareholders
and to amend the Protocol in conjunction with Target to reflect such delay (so
long as such delay does not extend later than January 30, 2003) such that the
amount per Ordinary Share distributed, in accordance with the Protocol, will
equal not less than the Target Minimum Amount; or (ii) accept such termination
by giving written notice to the Supervisory Board of Target, within five
Business Days after all of the Parent Entities have received Target's notice,
and PROVIDED, FURTHER, that it shall be a condition to termination pursuant to
this SECTION 8.1(k) that the Target shall have made the payment of the Break-Up
Expenses to the Purchasers required by SECTION 9.2.
SECTION 8.2. EFFECT OF TERMINATION. In the event of termination of this
Agreement by either Target or Purchasers as provided in SECTION 8.1, this
Agreement shall forthwith become void and have no effect, without any liability
or obligation on the part of Target or any Purchaser Party, other than the last
sentence of SECTION 5.3, SECTION 8.1, this SECTION 8.2, SECTION 9.2 and except
to the extent that such termination results from a willful breach by a party of
any of its representations, warranties, covenants or agreements set forth in
this Agreement.
ARTICLE IX
GENERAL PROVISIONS
SECTION 9.1. NON-SURVIVAL OF REPRESENTATIONS AND WARRANTIES. None of the
representations and warranties in this Agreement or in any instrument (other
than the Xxxxxxxx Letter, the Loyens Tax Opinion and the final Pro Forma Tax
Returns) delivered pursuant to this Agreement shall survive the Closing (and
thereafter no party shall have the right to commence any action alleging any
breach of such representations or warranties) or the termination of this
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Agreement pursuant to SECTION 8.1, as the case may be. This SECTION 9.1 shall
not limit any covenant or agreement of the parties which by its terms
contemplates performance after the Closing.
SECTION 9.2. EXPENSES.
(a) Except as otherwise specified in this SECTION 9.2 or agreed in
writing by the parties, 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.
(b) Target agrees that if this Agreement shall be terminated
pursuant to SECTION 8.1(b) OR (e) OR (h) OR (k), then Target will pay to each
Purchaser, or to such party or parties as directed by such Purchaser, a cash
amount in EUROs equal to the Break-Up Expenses (as hereinafter defined)
applicable to such Purchaser. Target also agrees that (i) if this Agreement
shall be terminated pursuant to SECTION 8.1(j) and the closing has not occurred
prior to the Termination Date due to a failure to obtain a Necessary Consent
(provided that Purchasers have complied with SECTION 5.4(a)), then Target will
pay to each Purchaser, or to such party or parties as directed by such
Purchaser, a cash amount in EUROs equal to the Reduced Break-Up Expenses
applicable to such Purchaser and (ii) if this Agreement shall be terminated
pursuant to SECTION 8.1(j) and the closing has not occurred prior to the
Termination Date due to a failure to fulfill SECTION 7.1(c) (provided that
Purchasers have complied with SECTION 5.4(a)), then Target will pay to each
Purchaser, or to such party or parties as directed by such Purchaser, a cash
amount in EUROs equal to the Break-Up Expenses applicable to such Purchaser.
Target further agrees that (i) if this Agreement is terminated pursuant to
SECTION 8.1(c) OR (d), or (ii) if (A) Purchasers or Target shall terminate this
Agreement pursuant to SECTION 8.1(g) (provided that the basis for such
termination is the failure of Target's shareholders to approve the Purchase) or
SECTION 8.1(j) without the Shareholders Meeting having occurred, (B) at any time
after the date of this Agreement and at or before the time of the event giving
rise to such termination there shall exist an Acquisition Proposal with respect
to Target, and (C) within 12 months of any such termination of this Agreement,
Target or any of its Subsidiaries shall enter into a definitive agreement with
any third party with respect to a Majority Acquisition Proposal or a Majority
Acquisition Proposal is consummated, then Target shall pay to Purchasers, or as
otherwise directed by Purchasers, an aggregate cash amount in EUROs equal to the
Break-Up Fee (as hereinafter defined); PROVIDED, HOWEVER, that any such Break-Up
Fee payable in connection with a termination pursuant to Section 8.1(j) shall be
reduced by the amount of any prior payment of Break-Up Expenses or Reduced
Break-Up Expenses. Payment of any of such amounts by Target, and any allocation
between Purchasers of such amounts shall be made, as jointly directed by
Purchasers in writing, by prompt wire transfer of immediately available funds,
but in no event later than the date of termination (or in the case of clause
(ii), if later, the date Target or its Subsidiary enters into such agreement
with respect to or consummates such Majority Acquisition Proposal) by wire
transfer of immediately available funds. A "MAJORITY ACQUISITION PROPOSAL" shall
be an Acquisition Proposal to acquire at least a majority of the Assets, whether
pursuant to a merger, consolidation or other business combination, sale of
shares of capital stock, sale of assets, tender offer, exchange offer or similar
transaction, including any single or multi-step transaction or series of related
transactions.
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(c) For purposes of this Agreement, the "BREAK-UP FEE" shall be an
aggregate amount equal to 2% of the Purchase Price (with the Purchase Price
calculated as if the Closing Date had occurred on the date of the termination
giving rise to Target's obligation to pay the Break-Up Fee).
(d) For purposes of this Agreement, the "BREAK-UP EXPENSES" shall be
an amount equal to the lesser of (i) the actual out-of-pocket expenses of
Purchasers and any of their respective Affiliates incurred in connection with
this Agreement and the transactions contemplated hereby (including, without
limitation, all attorneys', accountants', investment bankers' and financing
sources' fees and expenses) and (ii) 1% of the Purchase Price (with the Purchase
Price calculated as if the Closing Date had occurred on the date of the
termination giving rise to Target's obligation to pay the Break-Up Expenses).
For purposes of this Agreement, the "REDUCED BREAK-UP EXPENSES" shall mean the
Break-Up Expenses, except that such expenses shall be capped at 1/2% (rather
than 1%) of the Purchase Price.
(e) In the event that either Purchaser is required to file suit to
seek all or a portion of the amounts payable under this SECTION 9.2, and
Purchasers prevail in such litigation, Purchasers shall be entitled to all
expenses, including attorneys' fees and expenses, which it has incurred in
enforcing its rights under this SECTION 9.2.
(f) Notwithstanding anything to the contrary in this Agreement, each
Purchaser expressly acknowledges and agrees that, with respect to any
termination of this Agreement pursuant to SECTION 8.1 in circumstances where the
Break-Up Fee is payable in accordance with SECTION 9.2(b), the payment of the
Break-Up Fee shall constitute liquidated damages with respect to any claim for
damages or any other claim which such Purchaser would otherwise be entitled to
assert against Target or any Target Subsidiary or any of their respective
assets, or against any of their respective directors, officers, employees,
partners or stockholders, with respect to this Agreement and the transactions
contemplated by this Agreement and shall constitute the sole and exclusive
remedy available to such Purchaser. The parties hereto expressly acknowledge and
agree that, in light of the difficulty of accurately determining actual damages
with respect to the foregoing upon any termination of this Agreement pursuant to
SECTION 8.1 in circumstances where the Break-Up Fee is payable in accordance
with SECTION 9.2(b), the right to payment under SECTION 9.2(b): (i) constitutes
a reasonable estimate of the damages that will be suffered by reason of any such
proposed or actual termination of this Agreement pursuant to said section, and
(ii) shall be in full and complete satisfaction of any and all damages arising
as a result of the foregoing. Except for nonpayment of the amounts set forth in
SECTION 9.2(b), each Purchaser hereby agrees that, upon any termination of this
Agreement in circumstances where the Break-Up Fee is payable, in no event shall
such Purchaser or its affiliated Parent Entity (A) seek to obtain any recovery
or judgment against Target or any Target Subsidiary or any of their respective
assets, or against any of their respective directors, officers, employees,
partners or stockholders, or (B) be entitled to seek or obtain any other damages
of any kind, including, without limitation, consequential, indirect or punitive
damages.
(g) In the event that any Dutch court, including the Enterprise
Chamber determines that any term or provision of SECTION 5.8 or this SECTION 9.2
is unenforceable or unreasonable as a matter of Law, such term or provision
shall automatically be modified to the extent such Dutch court determines
necessary to conform to applicable Law, and this Agreement
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and, as applicable, the Protocol, as so modified, shall thereafter remain in
full force and effect. The parties hereto agree that, upon the occurrence of
such an event as described in the immediately preceding sentence, (i) the Dutch
court shall have the power to reduce the amount, scope or magnitude of any such
term or provision, to delete specific words or phrases from such term or
provision, or to replace any invalid or unenforceable term or provision so
implicated with a modified term or provision that is valid and enforceable and
that comes closest to expressing the intention of the invalid or unenforceable
term or provision, (ii) the parties hereto shall request that the Dutch court
exercise that power and (iii) thereafter this Agreement (and the Protocol) shall
be enforceable as so modified after the expiration of the time within which the
judgment or decision may be applied.
(h) Notwithstanding the foregoing, in no event shall the amount paid
to any of the Purchasers pursuant to this Agreement in any tax year exceed the
maximum amount that can be paid to such Purchaser in such year without causing
any REIT with which it is affiliated to fail to meet the REIT requirements for
such year, determined as if the payment of such amount did not constitute
Qualifying Income as determined by independent accountants to such Purchaser. If
the amount payable for any tax year under the preceding sentence is less that
the amount which Target would otherwise be obligated to pay to the applicable
Purchaser pursuant to this Agreement (the "EXPENSE AMOUNT"), such Purchaser
shall so notify Target, and Target shall (at such Purchaser's sole cost and
expense) place the remaining portion of the Expense Amount in escrow and shall
not execute any instrumentation permitting any release of any portion thereof to
the applicable Purchaser, and the applicable Purchaser shall not be entitled to
any such amount, unless and until Target and escrow holder receive (all at the
applicable Purchaser's sole cost and expense) notice from applicable Purchaser,
together with either (i) an opinion of the applicable Purchaser's tax counsel to
the effect that such amount, if and to the extent paid, would not constitute
gross income which is not Qualifying Income or (ii) a letter from the applicable
Purchaser's independent accountants indicating the maximum amount that can be
paid at that time to the Purchasers (determined as if such payment did not
constitute Qualifying Income) without causing any REIT with which it is
affiliated to fail to meet the REIT requirements for any relevant taxable year,
together with either an IRS Ruling issued to such REIT or an opinion of such
Purchaser's tax counsel to the effect that such payment would not be treated as
includible in the income of such REIT for any prior taxable year, in which event
escrow holder shall pay such maximum amount. Target's and escrow holder's
obligation to pay any unpaid portion of the Expense Amount shall terminate ten
(10) years from the date of this Agreement, and upon such date, escrow holder
shall remit any remaining funds in escrow to Target and Target shall have no
obligation to make any further payments notwithstanding that the entire Expense
Amount has not been paid as of such date. For purposes of the foregoing,
Qualifying Income shall income qualifying within the meaning of Section
856(c)(2) of the Code.
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SECTION 9.3. NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given or made (and
shall be deemed to have been duly given or made upon receipt) by delivery in
person, by courier service, by cable, by telecopy, by telegram, by telex or by
registered or certified mail (postage prepaid, return receipt requested) to the
respective parties at the following addresses (or at such other address for a
party as shall be specified in a notice given in accordance with this
SECTION 9.3):
(a) if to Target:
Rodamco North America N.V.
c/o Urban Retail Properties Co.
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxx and Xxxxxxx X. Xxxxxxx
Phone: 000-000-0000
Fax: 000-000-0000
with a copy to:
Winston & Xxxxxx
00 Xxxx Xxxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxx, Esq.
Phone: (000) 000-0000
Fax: (000) 000-0000
(b) if to Wallaby or Wallaby Acquisition Sub:
00000 Xxxxxxxx Xxxxxxxxx
Xxxxx 00
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: General Counsel
Phone: 000-000-0000
Fax: 000-000-0000
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with a copy to:
Skadden, Arps, Slate, Meager & Xxxx LLP
One Canada Square, Xxxxxx Xxxxx
Xxxxxx X00 0XX
Xxxxxx Xxxxxxx
Attention: Xxxxx X. Xxxxxxx
Phone: 000-00-000-000-0000
Fax: 000-00-000-000-0000
(c) if to Hoosier or Hoosier Acquisition Sub:
National City Center
000 Xxxx Xxxxxxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx
Phone: 000-000-0000
Fax: 000-000-0000
with a copy to:
Xxxxxxx Xxxx & Xxxxxxxxx
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx
Phone: 000-000-0000
Fax: 000-000-0000
(d) if to Terrapin or Terrapin Acquisition Sub:
00000 Xxxxxx Xxxxxxxx Xxxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Phone: 000-000-0000
Fax: 000-000-0000
with a copy to:
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Fried Xxxxx Xxxxxx Xxxxxxx & Xxxxxxxx
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxxxx, Xx.
Phone: 000-000-0000
Fax: 000-000-0000
SECTION 9.4. WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICABLE
LAW, THE PARTIES HEREBY IRREVOCABLY WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN
ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
SECTION 9.5. HEADINGS. The descriptive headings contained in this
Agreement are for convenience of reference only and shall not affect in any way
the meaning or interpretation of this Agreement.
SECTION 9.6. SEVERABILITY. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any Law or
public policy, all other terms and provisions of this Agreement shall
nevertheless remain in full force and effect (i) so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner materially adverse to any party or (ii) in accordance with
SECTION 9.2(g). Except as otherwise provided in SECTION 9.2(g) hereof, upon such
determination that any term or other provision is invalid, illegal or incapable
of being enforced, the parties hereto shall negotiate in good faith to modify
this Agreement so as to effect the original intent of the parties as closely as
possible in an acceptable manner in order that the transactions contemplated
hereby are consummated as originally contemplated to the greatest extent
possible.
SECTION 9.7. ASSIGNMENT. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns; PROVIDED, that neither this Agreement nor any of the
rights, interests or obligations hereunder may be assigned (whether by operation
of Law or otherwise) without the express written consent of the other parties
hereto (which consent may be granted or withheld in the sole discretion of the
party from whom such consent is requested) except that Purchasers (or any
Purchaser) may assign their or its rights, but not their or its respective
obligations (other than their respective obligations to purchase the Assets), to
any Purchaser Designee or Affiliate of either Purchaser without the consent of
Target; PROVIDED, FURTHER, that no such assignment shall relieve Purchasers (or
any Purchaser) of any liability or obligation under this Agreement.
SECTION 9.8. ENTIRE AGREEMENT; NO THIRD-PARTY BENEFICIARIES. This
Agreement and the Confidentiality Agreements constitute the entire agreement and
supersede all prior agreements and understandings, both written and oral,
between the parties with respect to the subject matter of this Agreement, and,
except for the Protocol and the Voting and Support Agreement, there are no other
or additional agreements between Purchasers or any of their Affiliates, on the
one hand, Target and its Affiliates, on the other hand, relating to, arising
from
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or otherwise entered into in connection with this Agreement and the transactions
contemplated hereby. Except for the provisions of SECTION 5.11(a)-(e), this
Agreement is not intended to confer upon any Person other than the parties
hereto any rights or remedies. In the event of any conflict or inconsistency
between the terms of this Agreement and the Protocol, the parties agree that the
terms of this Agreement shall control.
SECTION 9.9. AMENDMENT. This Agreement may not be amended or modified
except by an instrument in writing signed by, or on behalf of, Target and each
Purchaser Party.
SECTION 9.10. GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of
New York, applicable to
contracts executed in and to be performed entirely within that state, without
regard to conflicts of law principles. All actions and proceedings arising out
of or relating to this Agreement shall be heard and determined in any
New York
state or federal court sitting in the City of
New York.
SECTION 9.11. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.
SECTION 9.12. WAIVER. Target, on the one hand, and Purchasers,
collectively on the other hand, may (a) extend the time for the performance of
any of the obligations or other acts of the other party, (b) waive any
inaccuracies in the representations and warranties of the other party contained
herein or in any document delivered by the other party pursuant hereto or
(c) waive compliance with any of the agreements or conditions of the other party
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. Any waiver
of any term or condition shall not be construed as a waiver of any subsequent
breach or a subsequent waiver of the same term or condition, or a waiver of any
other term or condition, of this Agreement. The failure of any party to assert
any of its rights hereunder shall not constitute a waiver of any of such rights.
SECTION 9.13. RESERVATION OF RIGHTS. If the Closing does not occur and
this Agreement is terminated pursuant to the terms hereof, the Transaction
Documents and any other discussions, negotiations or exchanges relating to the
transactions contemplated by the Transaction Documents shall be with full
reservation of rights and none of the Transaction Documents (other than the
Confidentiality Agreements) or any such discussions, negotiations or exchanges
shall be regarded as waiving any rights or claims of any party thereto in any
ruling, litigation or any future claims that are or could be made relating to
the transactions contemplated by the Transaction Documents.
SECTION 9.14. ENFORCEMENT.
(a) Target acknowledges and agrees that it shall not be entitled to
seek an injunction or injunctions to prevent any Purchaser Party from breaching
this Agreement or to enforce specifically the terms and provisions of this
Agreement in any court located anywhere in the world. Target agrees that the
Purchaser Parties would suffer irreparable damage in the event that any of the
provisions of this Agreement were not performed in accordance with their
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specific terms or were otherwise breached. It is accordingly agreed that the
Purchasers shall be entitled to an injunction or injunctions to prevent breaches
of this Agreement and to enforce specifically the terms and provisions of this
Agreement in any court of the United States located in the State of
New York or
in any
New York state court, this being in addition to any other remedy to which
they are entitled at Law or in equity.
(b) Each of the parties hereto irrevocably agrees that any legal
action or proceeding with respect to this Agreement or for recognition and
enforcement of any judgment in respect hereof brought by the other party hereto
or its successors or assigns shall only be brought and determined in any federal
court located in the State of
New York or any
New York state court sitting in
the City of
New York, and each of the parties hereto hereby irrevocably submits
with regard to any such action or proceeding for itself and in respect to its
property, generally and unconditionally, to the exclusive jurisdiction of the
aforesaid courts. Each of the parties hereto hereby irrevocably waives, and
agrees not to assert, by way of motion, as a defense, counterclaim or otherwise,
in any action or proceeding with respect to this Agreement, (i) any claim that
it is not personally subject to the jurisdiction of the above-named courts for
any reason other than the failure to serve process in accordance with this
Section 9.13, (ii) that it or its property is exempt or immune from jurisdiction
of any such court or from any legal process commenced in such courts (whether
through service of notice, attachment prior to judgment, attachment in aid of
execution of judgment, execution of judgment or otherwise), and (iii) to the
fullest extent permitted by applicable law, that (A) the suit, action or
proceeding in any such court is brought in an inconvenient forum, (B) the venue
of such suit, action or proceeding is improper and (C) this Agreement, or the
subject matter hereof, may not be enforced in or by such courts. Each of the
parties further agrees that service of any process, summons, notice or document
by U.S. registered mail to such party's respective address set forth herein
shall be effective service of process for any action, suit or proceeding in New
York with respect to any matters to which it has submitted to jurisdiction as
set forth in this section.
SECTION 9.15. EXHIBITS; DISCLOSURE LETTER. All Exhibits referred to herein
and in the Target Disclosure Letter are intended to be and hereby are
specifically made a part of this Agreement.
SECTION 9.16. JOINT AND SEVERAL OBLIGATIONS. Subject to the following
proviso, all obligations of any Purchaser Party hereunder shall be joint and
several obligations of all of the Purchasers Parties; PROVIDED, HOWEVER, that
(i) no obligation of a Purchaser under SECTION 2.3, SECTION 5.11(f) or
ARTICLE VI hereof shall be a joint and several obligation of any Parent Entity
and (ii) no obligation of Hoosier or Terrapin under SECTION 5.11(a)-(e) shall be
a joint and several obligation of Wallaby, Wallaby Acquisition Sub or any of
Wallaby Acquisition Sub's Purchaser Designees.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, each of the parties hereto have caused this
Purchase
Agreement to be executed as of the date first written above by their respective
officers thereunto duly authorized.
RODAMCO NORTH AMERICA, N.V.
By:
-------------------
Name:
Title:
By:
-------------------
Name:
Title:
WESTFIELD AMERICA LIMITED PARTNERSHIP
By: Westfield America, Inc., its general
partner
By:
-------------------
Name:
Title:
WESTFIELD GROWTH, LP
By: Westfield Growth II, LP, its general
partner
By: Westfield Centers, LLC, its general
partner
By: Westfield America Limited
Partnership, its managing member
By: Westfield America, Inc., its general
partner
By:
-------------------
Name:
Title:
[Signature Page to
Purchase Agreement]
SIMON PROPERTY GROUP, L.P.
By: Simon Property Group, Inc., its
general partner
By:
-------------------
Name:
Title:
HOOSIER ACQUISITION, LLC
By: Simon Property Group, L.P., its
managing member
By: Simon Property Group, Inc., its
general partner
By:
-------------------
Name:
Title:
THE XXXXX COMPANY
By:
-------------------
Name:
Title:
TERRAPIN ACQUISITION, LLC
By: The Xxxxx Company, its managing member
By:
-------------------
Name:
Title:
[Signature Page to
Purchase Agreement]
