Exhibit 10.4


 


EXECUTION VERSION


 


SPINCO, INC.


 


- and -


 


BROOKFIELD ADVISORS LP


 






 


MANAGEMENT SERVICES AGREEMENT


 






 


August 6, 2010


 

















 


TABLE OF CONTENTS


 


	
  ARTICLE 1

  	
  INTERPRETATION

  	
  2

  
	
   

  	
   

  	
   

  
	
  1.1

  	
  Definitions

  	
  2

  
	
  1.2

  	
  Headings
  and Table of Contents

  	
  4

  
	
  1.3

  	
  Interpretation

  	
  5

  
	
  1.4

  	
  Currency

  	
  5

  
	
  1.5

  	
  Generally
  Accepted Accounting Principles

  	
  5

  
	
  1.6

  	
  Invalidity
  of Provisions

  	
  5

  
	
  1.7

  	
  Entire
  Agreement

  	
  5

  
	
  1.8

  	
  Waiver;
  Amendment

  	
  6

  
	
  1.9

  	
  Governing
  Law

  	
  6

  
	
  1.10

  	
  Jurisdiction;
  Venue

  	
  6

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2

  	
  APPOINTMENT
  OF THE MANAGER

  	
  7

  
	
   

  	
   

  	
   

  
	
  2.1

  	
  Appointment
  and Acceptance

  	
  7

  
	
  2.2

  	
  Subcontracting
  and Other Arrangements

  	
  7

  
	
  2.3

  	
  Spinco
  Subsidiaries

  	
  7

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3

  	
  SERVICES
  AND POWERS OF THE MANAGER

  	
  7

  
	
   

  	
   

  	
   

  
	
  3.1

  	
  Services

  	
  7

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4

  	
  MANAGEMENT
  AND EMPLOYEES

  	
  9

  
	
   

  	
   

  	
   

  
	
  4.1

  	
  Management
  and Employees

  	
  9

  
	
  4.2

  	
  Spinco
  Officers

  	
  9

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5

  	
  INFORMATION
  AND RECORDS

  	
  10

  
	
   

  	
   

  	
   

  
	
  5.1

  	
  Books
  and Records

  	
  10

  
	
  5.2

  	
  Access
  to Information by Manager; Confidentiality

  	
  10

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6

  	
  FEES
  AND EXPENSES

  	
  11

  
	
   

  	
   

  	
   

  
	
  6.1

  	
  Base
  Management Fee

  	
  11

  
	
  6.2

  	
  Expenses

  	
  11

  
	
  6.3

  	
  Governmental
  Charges

  	
  12

  
	
  6.4

  	
  Computation
  and Payment of Expenses and Governmental Charges

  	
  12

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7

  	
  REPRESENTATIONS
  AND WARRANTIES

  	
  12

  
	
   

  	
   

  	
   

  
	
  7.1

  	
  Representations
  and Warranties of the Manager

  	
  12

  
	
  7.2

  	
  Representations
  and Warranties of the Company

  	
  13

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8

  	
  LIABILITY
  AND INDEMNIFICATION

  	
  14

  
	
   

  	
   

  	
   

  
	
  8.1

  	
  Indemnity

  	
  14

  
	
  8.2

  	
  Limitation
  of Liability

  	
  15

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9

  	
  TERM
  AND TERMINATION

  	
  15

  
	
   

  	
   

  	
   

  
	
  9.1

  	
  Term

  	
  15

  
				



 


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  9.2

  	
  Termination
  by the Company

  	
  16

  
	
  9.3

  	
  Termination
  by the Manager

  	
  16

  
	
  9.4

  	
  Survival
  Upon Termination

  	
  16

  
	
  9.5

  	
  Action
  Upon Termination

  	
  17

  
	
  9.6

  	
  Extension
  Option

  	
  17

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10

  	
  GENERAL
  PROVISIONS

  	
  17

  
	
   

  	
   

  	
   

  
	
  10.1

  	
  Assignment

  	
  17

  
	
  10.2

  	
  Independent
  Contractor, No Partnership or Joint Venture

  	
  17

  
	
  10.3

  	
  Failure
  to Pay When Due

  	
  18

  
	
  10.4

  	
  Enurement

  	
  18

  
	
  10.5

  	
  Notices

  	
  18

  
	
  10.6

  	
  Further
  Assurances

  	
  19

  
	
  10.7

  	
  Counterparts

  	
  19

  
				



 


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MANAGEMENT SERVICES AGREEMENT


 


THIS AGREEMENT is made as of the 6th day of August, 2010
(the “Effective Date”)


 


B E T W E E N:


 


SPINCO, INC. (the “Company”), a corporation existing under the laws of the
State of Delaware


 


- and -


 


BROOKFIELD ADVISORS LP

(the “Manager”), a limited partnership
existing under the laws of the Province of Manitoba.


 


RECITALS:


 


Commencing on April 16, 2009, General Growth Properties, Inc.
(“GGP”), the indirect parent of the
Company, and its debtor affiliates filed voluntary petitions for relief under
chapter 11 of title 11 of the United States Code in the United States
Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”) (jointly administered under Case No. 09-11977
(ALG)) (the “Bankruptcy Cases”);


 


On May 7, 2010, the Bankruptcy Court entered the Order Pursuant to Sections 105(a) and 363 of the Bankruptcy Code (A)
Approving Bidding Procedures, (B) Authorizing the Debtors to Enter Into
Certain Agreements, (C) Approving the Issuance of Warrants, and (D) Granting
Related Relief (Docket No. 5145) authorizing GGP, among other
things, to enter into that certain Cornerstone Investment Agreement, dated as
of March 31, 2010 and as amended from time to time, with REP Investments
LLC, an affiliate of the Manager (the “Investment Agreement”);


 


The transaction contemplated by the Investment Agreement provides for,
among other things, the spin-off of certain assets from GGP into a new public
company to be created pursuant to the chapter 11 plan contemplated by the
Investment Agreement (the “Spin-off”),
with such Spin-off to be effected by means of a distribution of the shares of
common stock of the Company to the holders of common stock of GGP;


 


In preparation for and following the Spin-off, the Company wishes to
engage the Manager to provide to the Service Recipients, or arrange for the
provision of, certain services, subject to the terms and conditions of this
Agreement, and the Manager wishes to accept such engagement.


 


NOW THEREFORE in consideration of the mutual covenants and
agreements contained in this Agreement and other good and valuable
consideration (the receipt and sufficiency of which are hereby acknowledged),
the parties hereto agree as follows:


 

















 


ARTICLE 1

INTERPRETATION


 


1.1          Definitions


 


In
this Agreement, except where the context otherwise requires, the following
terms shall have the following meanings:


 


1.1.1                        “Affiliate” means, with respect to a Person, any other Person
that, directly or indirectly, through one or more intermediaries, Controls or
is Controlled by such Person, or is under common Control of a third Person;


 


1.1.2                        “Agreement” means this Management Services Agreement as the
same may be amended from time to time, and “herein”, “hereof”, “hereby”, “hereunder”
and similar expressions refer to this Agreement and include every instrument
supplemental or ancillary to this Agreement and, except where the context otherwise
requires, not to any particular article or section thereof;


 


1.1.3                        “Bankruptcy Cases” has the meaning assigned thereto in the
recitals;


 


1.1.4                        “Bankruptcy Closing” has the meaning assigned thereto in Section 1.10;


 


1.1.5                        “Bankruptcy Court” has the meaning assigned thereto in the
recitals;


 


1.1.6                        “Base Fee Rate” means the monthly equivalent of 1.0% (100
basis points) annually;


 


1.1.7                        “Base Management Fee” has the meaning assigned thereto in Section 6.1
hereof;


 


1.1.8                        “Board” means the board of directors of the Company;


 


1.1.9                        “Business” means, collectively, the business carried on or
contemplated to be carried on from time to time by the Spinco Group;


 


1.1.10                  “Business Day” means any day, other than a Saturday, a Sunday
or any legal holiday recognized as such by the government of the Province of
Ontario, the federal government of the United States or the government of the
State of New York;


 


1.1.11                  “Claims” has the meaning assigned thereto in Section 8.1.1;


 


1.1.12                  “Common Interest Agreement” means that certain Common
Interest and Confidentiality Agreement, dated as of June 18, 2010, by and
between General Growth Properties, Inc., Brookfield Asset Management, Inc.
and the individuals signatory thereto;


 


1.1.13                  “Confidential Information” has the meaning assigned thereto
in Section 5.2.2;


 


1.1.14                  “Control” means the control by one Person of another Person
in accordance with the following:  a
Person (“A”) controls another Person (“B”) where A has the power to 


 


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determine the management and
policies of B by contract or status (for example the status of A being the
general partner of B) or by virtue of beneficial ownership of a majority of the
voting interests in B; and for certainty and without limitation, if A owns
shares to which more than 50% of the votes permitted to be cast in the election
of directors to B or A is the general partner of B, a limited partnership, then
in each case A Controls B for this purpose;


 


1.1.15      “delegatee” has
the meaning assigned thereto in Section 2.2;


 


1.1.16      “Effective Date”
has the meaning assigned thereto in the preamble;


 


1.1.17      “Extension Term Fee” means
that monthly fee agreed to by the parties hereto, negotiating in good faith,
consistent with the asset management compensation structure (including annual
fee and related incentives) that the Manager is then receiving from other
non-controlled companies of similar size and complexity for which it provides
similar management services.


 


1.1.18      “GGP” has the
meaning assigned thereto in the recitals;


 


1.1.19      “Governmental Authority”
means any (a) multinational, federal, provincial, state, regional,
municipal, local or other government, governmental or public department,
central bank, court, tribunal, arbitral body, commission, board, bureau or
agency, domestic or foreign, (b) self-regulatory organization or stock
exchange, (c) subdivision, agent, commission, board, or authority of any
of the foregoing, or (d) quasi-governmental or private body exercising any
regulatory, expropriation or taxing authority under or for the account of any
of the foregoing;


 


1.1.20      “Indemnified Party”
has the meaning assigned thereto in Section 8.1;


 


1.1.21      “Indemnifying Party”
has the meaning assigned thereto in Section 8.1;


 


1.1.22      “Interest Rate” means
the prime rate of interest quoted in The Wall Street Journal
from time to time plus two percent;


 


1.1.23      “Investment Agreement”
has the meaning assigned thereto in the recitals;


 


1.1.24      “Laws” means all
laws (including common law), statutes, regulations, statutory rules, by-laws,
orders, ordinances, directives and the terms and conditions of any approvals,
permits, licenses or judgements of any Governmental Authority, together with
any applicable enforceable published notes, guidelines or policies, and the
term “applicable”, with respect to such Laws and in the context that refers to
one or more Persons, means such Laws that apply to such Person or Persons or
its or their business, undertaking, property or securities at the relevant time
and that emanate from a Governmental Authority having jurisdiction over the
Person or Persons or its or their business, undertaking, property or
securities;


 


1.1.25      “Liabilities”
has the meaning assigned thereto in Section 8.1.1;


 


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1.1.26      “Manager” has
the meaning set forth in the recitals hereto;


 


1.1.27      “Material Agreement”
means any contract, lease, license, agreement or other document or instrument
binding upon any member of the Spinco Group or affecting the Real Estate Assets
which includes obligations the performance or non-performance of which could
reasonably be expected to have a material impact on the results of operations
or the financial condition of the Spinco Group;


 


1.1.28      “Non-Disclosure Agreement”
means that certain Non-Disclosure Agreement, dated as of February 27,
2010, by and between General Growth Properties, Inc. and Brookfield Asset
Management, Inc.;


 


1.1.29      “Officers” has
the meaning assigned thereto in Section 4.2.1;


 


1.1.30      “Payment Date”
has the meaning assigned thereto in Section 6.1;


 


1.1.31      “Person” means
any individual, partnership, limited partnership, joint venture, syndicate,
sole proprietorship, company or corporation with or without share capital,
unincorporated association, trust, trustee, executor, administrator or other
legal personal representative, regulatory body or agency, government or
governmental agency, authority or entity however designated or constituted;


 


1.1.32      “Service Recipient(s)”
means any member of the Spinco Group that is a recipient of Services;


 


1.1.33      “Services” has
the meaning assigned thereto in Section 3.1;


 


1.1.34      “Spinco Group”
means, collectively, the Company, and any direct or indirect Subsidiary of the
Company;


 


1.1.35      “Spin-off” has
the meaning assigned thereto in the recitals;


 


1.1.36      “Subsidiary”
means, with respect to any Person, (i) any other Person that is directly
or indirectly Controlled by such Person, (ii) any trust in which such
Person holds all of the beneficial interests or (iii) any partnership, limited
liability company or similar entity in which such Person holds all of the
interests other than the interests of any general partner, managing member or
similar Person; and


 


1.1.37      “Term” means the
Initial Term and any Extension Term.


 


1.2                               Headings
and Table of Contents


 


The
inclusion of headings and a table of contents in this Agreement are for
convenience of reference only and shall not affect the construction or
interpretation hereof.


 


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1.3          Interpretation


 


In
this Agreement, unless the context otherwise requires:


 


1.3.1        words importing the singular include the plural and vice
versa, words importing gender include all genders or the neuter;


 


1.3.2        words importing the neuter include all genders; and


 


1.3.3        references to a party or parties includes that party’s or
those parties’ successors and permitted assigns.


 


1.4          Currency


 


All
amounts in this Agreement are stated and shall be paid in U.S. currency.


 


1.5          Generally Accepted
Accounting Principles


 


In
this Agreement, except to the extent otherwise expressly provided, references
to “generally accepted accounting principles” mean the generally accepted
accounting principles used by the Company in preparing its financial statements
from time to time.


 


1.6          Invalidity of
Provisions


 


Each
of the provisions contained in this Agreement is distinct and severable and a
declaration of invalidity or unenforceability of any such provision or part
thereof by a court of competent jurisdiction will not affect the validity or
enforceability of any other provision hereof. To the extent permitted by
applicable law, the parties waive any provision of law which renders any
provision of this Agreement invalid or unenforceable in any respect.  The parties shall engage in good faith
negotiations to replace any provision which is declared invalid or
unenforceable with a valid and enforceable provision, the economic effect of
which comes as close as possible to that of the invalid or unenforceable
provision which it replaces.


 


1.7          Entire Agreement


 


Except
as expressly provided for herein, this Agreement, the Non-Disclosure Agreement
and the Common Interest Agreement constitute the entire agreement between the
parties pertaining to the subject matter of this Agreement.  There are no warranties, conditions, or
representations (including any that may be implied by statute) and there are no
agreements in connection with such subject matter except as specifically set
forth or referred to in this Agreement, the Non-Disclosure Agreement or the
Common Interest Agreement.  No reliance
is placed on any warranty, representation, opinion, advice or assertion of fact
made either prior to, contemporaneous with, or after entering into this
Agreement, or any amendment or supplement thereto, by any party to this
Agreement or its directors, officers, employees or agents, to any other party
to this Agreement or its directors, officers, employees or agents, except to
the extent that the same has been reduced to writing and included as a term of
this Agreement, and none of the parties to this Agreement has been induced to
enter into this Agreement or any amendment or supplement by reason of any such
warranty, representation, opinion, advice or assertion of fact.  


 


5

















 


Accordingly,
there will be no liability, either in tort or in contract, assessed in relation
to any such warranty, representation, opinion, advice or assertion of fact,
except to the extent contemplated above.


 


1.8          Waiver; Amendment


 


Except
as expressly provided in this Agreement, no amendment or waiver of this
Agreement will be binding unless executed in writing by the party to be bound
thereby.  No waiver of any provision of
this Agreement will constitute a waiver of any other provision nor will any
waiver of any provision of this Agreement constitute a continuing waiver unless
otherwise expressly provided.


 


1.9          Governing Law


 


This
Agreement, its negotiation, execution,
performance or nonperformance, interpretation, termination and construction and
all matters based upon, arising out of or related to any of the foregoing
(whether in equity, law or statute) will be governed by and construed in
accordance with the internal laws of the State of New York, without regard to the conflicts of law principles
of such State.


 


1.10        Jurisdiction; Venue


 


Any dispute, controversy or
claim arising out of or relating to this Agreement or the provision of the
Services that arises prior to the later of the closing of the Bankruptcy Case
for GGP or the closing of the Bankruptcy Case for GGP Limited Partnership (such
later time, the “Bankruptcy Closing”) shall be
subject to the jurisdiction of and determination by the Bankruptcy Court, and
any dispute, controversy or claim arising out of or relating to this Agreement
or the provision of the Services that arises after the Bankruptcy Closing shall
be subject to the jurisdiction of and determination by the United States
District Court for the Southern District of New York.  Each of the parties hereto (a) consents
to the exclusive personal jurisdiction of the Bankruptcy Court (prior to the
Bankruptcy Closing) or the United States District Court for the Southern
District of New York (after the Bankruptcy Closing) in connection with any
dispute arising out of or relating to this Agreement or the provision of the
Services, (b) agrees that it will not attempt to deny or defeat such
personal jurisdiction by motion or other request for leave from such courts and
(c) agrees that it will not bring any action relating to this Agreement or
the provision of the Services in any court other than the Bankruptcy Court
(prior to the Bankruptcy Closing) or the United States District Court for the
Southern District of New York (after the Bankruptcy Closing), unless such court
first determines it does not have subject matter jurisdiction or otherwise
declines to hear the dispute.  Manager
hereby appoints as its agent for receipt of service of process: Brookfield
Asset Management LLC, 3 World Financial Center, 200 Vesey Street, 11th Floor,
New York, NY 10281.


 


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ARTICLE 2

APPOINTMENT OF THE MANAGER


 


2.1                               Appointment
and Acceptance


 


2.1.1        Subject to and in accordance with the terms, conditions and
limitations in this Agreement, the Company, on its own behalf and as agent for
the other members of the Spinco Group, hereby appoints and retains the Manager
to provide the Services subject to the oversight of the Board.


 


2.1.2        The Manager hereby accepts the appointment provided for in
section 2.1.1 and agrees to act in such capacity and to provide or arrange for
the provision of the Services upon the terms set forth in this Agreement.


 


2.2                               Subcontracting
and Other Arrangements


 


The
Manager may subcontract to any of its Affiliates or, with the Company’s prior
written consent (not to be unreasonably withheld), other third parties (any
such parties referred to as a “delegatee”) any
or all of the Services to be provided by it under this Agreement, and the
Company hereby consents to any such subcontracting; provided that the Manager
shall remain responsible to the Company for any Services provided by such
delegatee. Where appropriate in this Agreement, all references to the Manager
will include the permitted delegatees where the context makes it appropriate.


 


2.3                               Spinco
Subsidiaries


 


The
Company covenants and agrees to cause, upon request of the Manager, any or all
present or subsequently acquired Subsidiaries who are at any time a Service
Recipient to execute such documentation and take such further action as may be
necessary or desirable to accomplish the purposes of this Agreement or the
agreements or arrangements contemplated by this Agreement.


 


ARTICLE 3

SERVICES AND POWERS OF THE MANAGER


 


3.1                               Services


 


The
Manager shall provide the following services (the “Services”)
to the Company and other members of the Spinco Group as requested by the
Company:


 


3.1.1        providing such services as are reasonably necessary or
requested by the Board in order to accomplish the Spin-off;


 


3.1.2        providing overall strategic advice in relation to the
Business, including oversight of detailed asset plans for each of the Company’s
material assets;


 


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3.1.3        making recommendations for the development of projects,
establishment of joint ventures, sales or other similar transactions and
overseeing the execution of such transactions;


 


3.1.4        overseeing the preparation and implementation of an annual
business plan, including an annual capital expenditure plan and overseeing the
preparation and implementation of other strategic or long term plans as
required for the Business;


 


3.1.5        making recommendations concerning current and future
financing requirements of the Business and overseeing such financing, whether
completed by way of indebtedness, equity or otherwise, including in respect of
the preparation, review or distribution of any registration statement or
offering memorandum related thereto and assisting with communications support
in connection therewith;


 


3.1.6        making recommendations concerning potential acquisitions or
corporate transactions and overseeing the execution of such transactions;


 


3.1.7        making available qualified individuals to act as senior
executives of the Company in furtherance of the provision of Services,
including as provided in Section 4.2;


 


3.1.8        overseeing corporate functions, including accounting and
management reporting, information systems, tax preparation and other corporate
functions, to be provided on a transitional basis by certain Subsidiaries of
GGP following the Spin-off, and developing and overseeing implementation of a
long term plan for such functions following termination of the transition
services agreement;


 


3.1.9        advising and assisting the Company and its Subsidiaries to
establish, maintain and implement appropriate policies and procedures designed
to ensure compliance with:


 


3.1.9.1             the requirements of securities and
other Laws, including the Sarbanes-Oxley Act, or any permits and other
obligations imposed by any Governmental Authority affecting the Business or the
Company;


 


3.1.9.2             the annual business plan;


 


3.1.9.3             any other obligations by which the
Company or its Subsidiaries is bound, including, for greater clarity,
obligations under Material Agreements;


 


3.1.10      advising and assisting with regard to
community and investor relations of the Company and its Subsidiaries; and


 


3.1.11      advising and assisting with respect to the
listing of the Company’s common stock on a national securities exchange.


 


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ARTICLE 4

MANAGEMENT AND EMPLOYEES


 


4.1          Management and
Employees


 


4.1.1        The Manager shall ensure that its officers and employees
devote such of their time to the provision of the Services as the Manager
reasonably deems necessary and appropriate, in order to fulfill its obligations
hereunder. Such personnel need not have as their primary responsibility the
provision of the Services to the Service Recipients or be dedicated exclusively
to the provision of the Services.


 


4.1.2        The Company shall, and shall cause other members of the
Spinco Group to, do all things reasonably necessary on its part as requested by
the Manager consistent with the terms of this Agreement to enable the Manager
to fulfill its obligations under this Agreement including without limitation,
making available to the Manager, and granting the Manager access to, the
employees or contractors of the Service Recipients as the Manager may from time
to time reasonably request in order for the Manager to perform its obligations,
covenants and responsibilities and exercise its rights pursuant to the terms
hereof.


 


4.1.3        For greater certainty, where the Manager is unable to satisfy
an obligation under this Agreement, as a direct or indirect result of a failure
by a Service Recipient to satisfy its obligations under this Article 4 or Section 5.2,
the Manager shall be deemed not to be in breach of its obligations under this
Agreement.


 


4.2          Spinco Officers


 


4.2.1        Effective as of the Effective Date, the Manager shall make
available the individuals listed on Exhibit A to act as duly elected
officers of the Company in the capacity or capacities set forth opposite their
respective names on Exhibit A (the “Officers”), to
serve as such until their successors are duly elected or their earlier death,
resignation or removal from office.


 


4.2.2        The Manager shall have the right, from time to time during
the Term, upon not less than 10 days’ prior written notice to the Company, to
replace any Officer with an individual having similar qualifications and
experience level, in the Manager’s reasonable discretion.  The Company shall have the right, at any time
and from time to time, to remove any Officer for cause, which shall include
(a) willfully disregarding any Board directive or (b) failure to
perform his or her duties in accordance with standards reasonably established
by the Board from time to time.


 


4.2.3        The Manager acknowledges that the Officers will be required
to report to the Board, will be fiduciaries of the Company and its shareholders
in accordance with Delaware law, and, in the case of the Chief Executive
Officer and Chief Financial Officer, will act as the “principal executive
officer” and “principal financial officer”, respectively, of the Company under
applicable SEC rules and regulations. 
The Manager further acknowledges that the Board retains authority to
make ultimate decisions with respect to Company policies and strategic
matters.  The Manager agrees to report to
the


 


9














 


Board at least quarterly, at
regularly scheduled meetings, with respect to the progress of the Services.


 


4.2.4                     If the Board reasonably
determines that it is necessary or advisable in order to achieve tax-free
treatment for the Spin-off, the Manager will use reasonable commercial efforts
to cause the Officers and other employees of the Manager or its Affiliates
mutually agreed by the Manager and the Company who are providing Services to
become part-time employees of the Company.


 


ARTICLE 5


INFORMATION AND RECORDS


 


5.1                               Books
and Records


 


The
Company shall, and shall cause the other Service Recipients to, maintain proper
books, records and documents in which complete, true and correct entries, in
conformity in all material respects with generally accepted accounting
principles and all requirements of applicable Laws, will be made; provided that
the Manager acknowledges that the Officers will have primary responsibility for
oversight of such books, records and documents and to ensure that policies and
procedures are in place for compliance with Law applicable thereto.


 


5.2                               Access
to Information by Manager; Confidentiality


 


5.2.1                     The Company shall, and shall
cause other members of the Spinco Group to:


 


5.2.1.1                                  grant, or cause
to be granted, to the Manager full access to all documentation and information
necessary in order for the Manager to perform its obligations, covenants and
responsibilities pursuant to the terms hereof, including all of the books,
records, documents and financial and operating data of the Service Recipients
required to be maintained under Section 5.1 and to enable the Manager to
provide the Services; and


 


5.2.1.2                                  provide, or
cause to be provided, all documentation and information as may be reasonably
requested by the Manager, and promptly notify the appropriate member of the
Manager of any material facts or information of which any Service Recipient is
aware, which may affect the performance of the obligations, covenants or
responsibilities of the Manager pursuant to this Agreement, including maintenance
of proper financial records, including any known, pending or threatened suits,
actions, claims, proceedings or orders by or against the Service Recipients,
before any court or administrative tribunal.


 


5.2.2                     The Manager shall not, and
shall cause its officers, employees and delegatees having access to information
of the Company that is known to the Manager as confidential or proprietary (“Confidential Information”) not to, disclose to any other
Person or use, except for purposes of providing the Services, any Confidential
Information; provided, however, that the Manager may disclose Confidential
Information to the extent permitted by applicable Law: (i) to its
delegatees on a need-to-know basis in connection with the performance of the
Services under this Agreement; (ii) in any report,


 


10

















 


statement, testimony or
other submission required to be made to any Governmental Authority having
jurisdiction over the Manager; or (iii) in order to comply with applicable
Law, or in response to any summons, subpoena or other legal process or formal
or informal investigative demand issued to the Manager in the course of any
litigation, investigation or administrative proceeding.


 


5.2.3                     The Manager shall, and shall
cause its officers, employees and delegatees to, protect the Confidential
Information by using the same degree of care to prevent the unauthorized
disclosure of such Confidential Information as the Manager uses to protect its
own confidential information of a like nature.


 


5.2.4                     Each party shall comply with
all applicable state, federal and foreign privacy and data protection Laws that
are or that may in the future be applicable to the provision of Services under
this Agreement.  The Manager hereby agrees
that it will not, and will instruct its officers, employees and delegatees that
it is a violation of applicable Law for any such person to, purchase or sell
securities of the Company based on non-public information obtained in
connection with the performance of Services.


 


ARTICLE 6


FEES AND EXPENSES


 


6.1                               Base
Management Fee


 


6.1.1                     As compensation for the
Services to be provided by the Manager pursuant to the terms of this Agreement,
the Company hereby covenants and agrees to pay to the Manager a base management
fee (the “Base Management Fee”) in an amount
equal to


 


6.1.1.1                                  For the Initial
Term, $500,000 per month paid monthly in advance within five Business Days
following the beginning of each month (the “Payment Date”);
and


 


6.1.1.2                                  During the
Extension Term (if any) a monthly fee payable within five Business Days of the
beginning of the relevant month in an amount equal to the Extension Term Fee.


 


6.2                               Expenses


 


6.2.1                     The Company shall reimburse
the Manager for all reasonable out-of-pocket fees, costs and expenses owed to
any third party (“Expenses”)
incurred by the Manager in connection with the provision of the Services, which
may include, among other things:


 


6.2.1.1                                  taxes, licenses
and other statutory fees or penalties levied against or in respect of a Service
Recipient in respect of the Services;


 


6.2.1.2                                  amounts paid by
the Manager under indemnification, contribution or similar arrangements entered
into in connection with the provision of Services with the prior approval of
the Board;


 


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6.2.1.3                                  any other fees,
costs and expenses that are reasonably necessary for the performance by the
Manager of its duties and functions under this Agreement.


 


6.3                               Governmental
Charges


 


Without
limiting Section 6.2, the Company shall pay or reimburse the Manager for
all sales, use, value added, goods and services, withholding or other taxes,
customs duties or other governmental charges (“Governmental
Charges”) which are levied or imposed by any Governmental Authority
by reason of this Agreement, except for any income taxes, corporation taxes,
capital taxes or other similar taxes payable by the Manager which are personal
to the Manager.  Any failure by the
Manager to collect monies on account of these Governmental Charges shall not
constitute a waiver of the right to do so.


 


6.4                               Computation
and Payment of Expenses and Governmental Charges


 


The
Manager shall, from time to time, prepare statements (“Expense
Statement(s)”) documenting the Expenses and Governmental Charges to
be reimbursed pursuant to this Article 6 and shall deliver such statement
to each relevant Service Recipient.  All
Expenses and Governmental Charges reimbursable pursuant to this Article 6
shall be reimbursed by the relevant Service Recipient no later than the date
which is 30 days after receipt of the Expense Statement. The provisions of this
Section 6.4 shall survive the termination of this Agreement.


 


ARTICLE 7


REPRESENTATIONS AND
WARRANTIES


 


7.1                               Representations
and Warranties of the Manager


 


The
Manager  hereby represents and warrants
to the Company that:


 


7.1.1                     it is validly organized and
existing under the relevant laws governing its formation and existence;


 


7.1.2                     it has the power, capacity
and authority to enter into this Agreement and to perform its duties and
obligations hereunder;


 


7.1.3                     it has taken all necessary
action to authorize the execution, delivery and performance of this Agreement;


 


7.1.4                     the execution and delivery
of this Agreement by it and the performance by it of its obligations hereunder
do not and will not contravene, breach or result in any default under its  constituent documents or other organizational
documents, or under any mortgage, lease, agreement or other legally binding
instrument, license, permit or applicable law to which it is a party or by
which it or any of its properties or assets may be bound;


 


12

















 


7.1.5                     no authorization, consent or
approval, or filing with or notice to any Person is required in connection with
the execution, delivery or performance by it of this Agreement; and


 


7.1.6                     this Agreement constitutes a
valid and legally binding obligation of it enforceable against it in accordance
with its terms, subject to (i) applicable bankruptcy, insolvency,
moratorium, fraudulent conveyance, reorganization and other laws of general
application limiting the enforcement of creditors’ rights and remedies
generally and (ii) general principles of equity, including standards of
materiality, good faith, fair dealing and reasonableness, equitable defenses
and limits as to the availability of equitable remedies, whether such
principles are considered in a proceeding at law or in equity.


 


7.2                               Representations
and Warranties of the Company


 


The
Company hereby represents and warrants to the Manager that:


 


7.2.1                     it is validly organized and
existing under the relevant laws governing its formation and existence;


 


7.2.2                     subject to receipt of
approval from the Bankruptcy Court, it has the power, capacity and authority to
enter into this Agreement and to perform its duties and obligations hereunder;


 


7.2.3                     it has taken all necessary
action to authorize the execution, delivery and performance of this Agreement;


 


7.2.4                     the execution and delivery
of this Agreement by it and the performance by it of its obligations hereunder
do not and will not contravene, breach or result in any default under its
charter, by-laws, constituent documents or other organizational documents, or
under any mortgage, lease, agreement or other legally binding instrument, license,
permit or applicable law to which it is a party or by which it or any of its
properties or assets may be bound;


 


7.2.5                     no authorization, consent or
approval, or filing with or notice to any Person (other than filing with, and
approval by, the Bankruptcy Court) is required in connection with the
execution, delivery or performance by it of this Agreement; and


 


7.2.6                     subject to receipt of
approval from the Bankruptcy Court, this Agreement constitutes a valid and
legally binding obligation of it enforceable against it in accordance with its
terms, subject to:  (i) applicable
bankruptcy, insolvency, moratorium, fraudulent conveyance, reorganization and
other laws of general application limiting the enforcement of creditors’ rights
and remedies generally; and (ii) general principles of equity, including
standards of materiality, good faith, fair dealing and reasonableness,
equitable defenses and limits as to the availability of equitable remedies,
whether such principles are considered in a proceeding at law or in equity.


 


13

















 


ARTICLE 8


LIABILITY AND
INDEMNIFICATION


 


8.1                               Indemnity


 


8.1.1                     The Company (for purposes of
this Article, an “Indemnifying Party”)
hereby agrees, to the fullest extent permitted by applicable Law, to indemnify
and hold harmless each of the Manager and each of its Affiliates, and any
directors, officers, agents, subcontractors, delegatees, members, partners,
shareholders, officers and employees of each of the foregoing (each, an “Indemnified Party”) from and against any claims,
liabilities, losses, damages, costs or expenses (including legal fees) (“Liabilities”) incurred by them or threatened in connection
with any and all actions, suits, investigations, proceedings or claims of any
kind whatsoever, whether arising under statute or action of a regulatory
authority or otherwise, arising from this Agreement or the Services provided
hereunder (“Claims”); provided that no
Indemnified Party shall be so indemnified with respect to any Claim to the extent
that such Claim is finally determined by a final and non-appealable judgment
entered by a court of competent jurisdiction, or pursuant to a settlement
agreement agreed to by such Indemnified Party, to have resulted from such
Indemnified Party’s bad faith, fraud, willful misconduct, gross negligence or,
in the case of a criminal matter, conduct undertaken with knowledge that the
conduct was unlawful.


 


8.1.2                     The Manager and the Company
agree that in case any Claim should be made by a third party arising from this
Agreement or the Services provided hereunder, the Indemnifying Party shall have
the right to assume and conduct the defense of such Claim with counsel of its
own choosing; provided that the Indemnified Party shall have the right to
participate in such defense and to employ its own counsel in connection
therewith at the Indemnified Party’s sole expense.  If the Indemnifying Party does not assume the
defense of any such third-party Claim, the Indemnified Party shall have the
right to employ its own counsel in connection therewith, and the reasonable
fees and expenses of such counsel, as well as the reasonable out-of-pocket
costs and expenses incurred in connection therewith shall be paid by the
Indemnifying Party in such case, as incurred but subject to recoupment by the
Indemnifying Party if ultimately it is not liable to pay indemnification
hereunder.  The Indemnified Party will
not consent to a settlement of, or the entry of any judgment arising from, any
such third-party Claim without the prior written consent of the Indemnifying
Party (such consent not to be unreasonably withheld, conditioned or delayed).


 


8.1.3                     The Manager and the Company
agree that, promptly after the receipt of notice of the commencement of any
third-party Claim involving an Indemnified Party pursuant to this Agreement,
where such Claim is based, directly or indirectly, upon any matter in respect
of which this Agreement provides for indemnification, the Indemnified Party in
such case shall notify the Indemnifying Party in writing of the commencement of
such Claim (provided that any accidental failure to provide any such notice
shall not prejudice the right of any such Indemnified Party hereunder, except
to the extent that such failure prevents participation by the Indemnifying Party
in such Claim) and, throughout the course of such Claim, the party responsible
for the defense of such claim hereunder shall 


 


14

















 


use its best efforts to
provide copies of all relevant documentation to the other party and shall keep
the other party appraised of the progress thereof and shall discuss with the
other party all significant actions proposed.


 


8.1.4                     The parties hereto expressly
acknowledge and agree that the right to indemnity provided in this Section 8.1
shall be in addition to and not in derogation of any other liability which the
Indemnifying Party in any particular case may have or of any other right to
indemnity or contribution which any Indemnified Party may have by statute or
otherwise at law.


 


8.1.5                     The indemnity provided in
this Section 8.1 shall survive the completion of Services rendered under,
or any termination or purported termination of, this Agreement.


 


8.2                               Limitation
of Liability


 


8.2.1                     The Manager assumes no
responsibility under this Agreement other than to render the Services in good
faith and in accordance with Section 4.2.3 and shall not be responsible
for any action of a Service Recipient in declining to follow any advice or
recommendations of the Manager.


 


8.2.2                     Without limiting the
provisions of Section 4.2.3, the Company hereby agrees that no Indemnified
Party shall be liable to a Service Recipient, a director or officer (or other
individual with similar function) of a Service Recipient or any security holder
or partner of a Service Recipient for any Liabilities that may occur as a
result of any acts or omissions by the Indemnified Party pursuant to or in
accordance with this Agreement, except to the extent that such Liabilities are
finally determined by a final and non-appealable judgment entered by a court of
competent jurisdiction to have resulted from the Indemnified Party’s bad faith,
fraud, willful misconduct, gross negligence, or in the case of a criminal
matter, conduct undertaken with knowledge that the conduct was unlawful.  For the avoidance of doubt, the provisions of
this Section 8.2 shall survive the termination of this Agreement.


 


8.2.3                     The maximum amount of the
aggregate liability of the Manager and each of its Affiliates, and any
directors, officers, agents, subcontractors, delegatees, agents, advisors or
other representatives of the Manager or its Affiliates pursuant to this
Agreement will be equal to the amounts previously paid in respect of Services
pursuant to this Agreement or any agreement or arrangement provided for under
this Agreement in the two most recent calendar years by the Service Recipients.


 


ARTICLE 9

TERM AND TERMINATION


 


9.1                               Term


 


The
Manager’s engagement hereunder shall begin on the Effective Date and shall
continue in full force and effect for a period of six months (the “Initial Term”) unless terminated earlier in accordance with Section 9.2
or extended in accordance with Section 9.6.


 


15

















 


9.2                               Termination
by the Company


 


9.2.1                     The Company may terminate
this Agreement for any reason or no reason, effective upon 45 days prior
written notice of termination to the Manager or payment of a termination fee
equal to the Base Management Fee that would have been payable during such 45
day period.


 


9.2.2                     The Company may also
terminate this Agreement effective immediately upon written notice of
termination to the Manager without payment of any termination fee if:


 


9.2.2.1                                  the Manager
engages in any act of fraud, misappropriation of funds or embezzlement against
any Service Recipient;


 


9.2.2.2                                  there is an
event of any bad faith, willful misconduct or gross negligence on the part of
the Manager in the performance of the Services and such bad faith, willful
misconduct or gross negligence results in material harm to the Spinco Group; or


 


9.2.2.3                                  the Manager
makes a general assignment for the benefit of its creditors, institutes
proceedings to be adjudicated voluntarily bankrupt, consents to the filing of a
petition of bankruptcy against it, is adjudicated by a court of competent
jurisdiction as being bankrupt or insolvent, seeks reorganization under any
bankruptcy law or consents to the filing of a petition seeking such
reorganization or has a decree entered against it by a court of competent
jurisdiction appointing a receiver liquidator, trustee or assignee in
bankruptcy or in insolvency.


 


9.3                               Termination
by the Manager


 


9.3.1                     The Manager may terminate
this Agreement effective upon written notice of termination to the Company
without payment of any termination fee if:


 


9.3.1.1                                  The Company
makes a general assignment for the benefit of its creditors, institutes
proceedings to be adjudicated voluntarily bankrupt, consents to the filing of a
petition of bankruptcy against it, is adjudicated by a court of competent
jurisdiction as being bankrupt or insolvent, seeks reorganization under any
bankruptcy law or consents to the filing of a petition seeking such
reorganization or has a decree entered against it by a court of competent
jurisdiction appointing a receiver liquidator, trustee or assignee in
bankruptcy or in insolvency.


 


9.4                               Survival
Upon Termination


 


If
this Agreement is terminated pursuant to this Article 9, such termination
will be without any further liability or obligation of any party hereto, except
as provided in Section 6.4, Article 8, Section 9.5 and Article 10
hereof.


 


16

















 


9.5                               Action
Upon Termination


 


From
and after the effective date of the termination of this Agreement, the Manager
shall not be entitled to receive the Base Management Fee for further services
under this Agreement, but shall be paid all compensation accruing to the date
of termination (including such day).


 


9.6                               Extension
Option


 


The
Company may, by written notice at least 30 days prior to the expiry of the
Initial Term, elect, in its sole discretion, to extend the term of this
Agreement for up to an additional six months 
(the “Extension Term”); provided,
however, that during such 30 day (or longer) notice period the parties shall
negotiate in good faith in order to determine the Extension Term Fee prior to
the expiration of such 30-day period.


 


ARTICLE 10


GENERAL PROVISIONS


 


10.1                        Assignment


 


10.1.1              This Agreement shall not be
assigned by the Manager without the prior written consent of the Company,
except (i) pursuant to Section 2.2, or (ii) in the case of
assignment by the Manager to an Affiliate or a Person that is its successor by
merger, consolidation or purchase of assets, in which case the Affiliate or
successor shall be bound under this Agreement and by the terms of the
assignment in the same manner as such of the Managers is bound under this
Agreement.  In addition, provided that
the Manager provides prior written notice to the Company for informational
purposes only, nothing contained in this Agreement shall preclude any pledge,
hypothecation or other transfer or assignment of the Manager’s rights under
this Agreement, including any amounts payable to the Managers under this
Agreement, to a bona fide lender as security.


 


10.1.2              This Agreement shall not be
assigned by the Company without the prior written consent of the Manager,
except in the case of assignment by the Company to a Person that is its
successor by merger, consolidation or purchase of assets, in which case the
successor shall be bound under this Agreement and by the terms of the
assignment in the same manner as the Company is bound under this
Agreement.  In addition, provided that
the Company provides prior written notice to the Manager for informational
purposes only, nothing contained in this Agreement shall preclude any pledge,
hypothecation or other transfer or assignment of the Company’s rights under
this Agreement to a bona fide lender as security.


 


10.1.3              Any purported assignment of
this Agreement in violation of this Article 10 shall be null and void.


 


10.2                        Independent
Contractor, No Partnership or Joint Venture


 


The
parties acknowledge that the Manager is providing the Services hereunder as an
independent contractor and that the Manager and the Service Recipients are not
partners or 


 


17

















 


joint
venturers or agents of one another and nothing herein will be construed so as
to make them partners or joint venturers or agents of one another or impose any
liability as such on any of them as a result of this Agreement. Nothing in this
agreement shall prohibit  or limit the
Manager (or any Affiliate, director, officer, member, partner, shareholder, of
the Manager or any of their respective officers or employees) from engaging in
other business activities or sponsoring, or providing services to, third
parties that compete directly or indirectly with the Service Recipients.


 


10.3                        Failure
to Pay When Due


 


Any
amount payable by the Company hereunder which is not remitted when so due shall
remain due (whether on demand or otherwise) and interest will accrue on such
overdue amounts (both before and after judgment) at a rate per annum equal to
the Interest Rate beginning five (5) days after the date when payment is
due.


 


10.4                        Enurement


 


This
Agreement will enure to the benefit of and be binding upon the parties hereto
and their respective successors and permitted assigns.


 


10.5                        Notices


 


Any
notice or other communication required or permitted to be given hereunder will
be in writing and will be given by prepaid first-class mail, by facsimile or
other means of electronic communication or by hand-delivery as hereinafter
provided.  Any such notice or other
communication, if mailed by prepaid first-class mail at any time other than
during a general discontinuance of postal service due to strike, lockout or
otherwise, shall be deemed to have been received on the 4th Business Day after
the post-marked date thereof, or if sent by facsimile or other means of
electronic communication, shall be deemed to have been received on the Business
Day following the sending, or if delivered by hand shall be deemed to have been
received at the time it is delivered to the applicable address noted below
either to the individual designated below or to an individual at such address
having apparent authority to accept deliveries on behalf of the addressee.  Notice of change of address shall also be
governed by this section.  In the event
of a general discontinuance of postal service due to strike, lock-out or
otherwise, notices or other communications shall be delivered by hand or sent
by facsimile or other means of electronic communication and shall be deemed to
have been received in accordance with this section. Notices and other
communications shall be addressed as follows:


 


if to the Company:


 


Spinco, Inc.


c/o
General Growth Properties, Inc.


110
N. Wacker Drive


Chicago, Illinois
60606


 


Attention:                                         Ronald L. Gern, Esq.


Telecopier
number:                                       312-960-5485


 


18

















 


if
to the Manager:


 


Brookfield
Asset Management, Inc.


Brookfield
Place, Suite 300


181
Bay Street, Box 762


Toronto,
Ontario M5J 2T3


Canada


 


Attention:                                         Joseph Freedman


Telecopier
number:                                       416-365-9642


 


10.6                        Further
Assurances


 


Each
of the parties hereto shall promptly do, make, execute or deliver, or cause to
be done, made, executed or delivered, all such further acts, documents and
things as the other party hereto may reasonably require from time to time for
the purpose of giving effect to this Agreement and will use reasonable efforts
and take all such steps as may be reasonably within its power to implement to
their full extent the provisions of this Agreement.


 


10.7                        Counterparts


 


This
Agreement may be signed in counterparts and each of such counterparts will
constitute an original document and such counterparts, taken together, will
constitute one and the same instrument.


 


[NEXT PAGE IS SIGNATURE
PAGE]


 


19

















 


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


 


 


	
   

  	
  SPINCO, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Ronald L. Gern

  
	
   

  	
  Name:
  

  	
  Ronald
  L. Gern

  
	
   

  	
  Title:

  	
  Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BROOKFIELD
  ADVISORS LP

  
	
   

  	
  by
  its general partner, BAM Limited

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Joeseph Freedman

  
	
   

  	
  Name:
  

  	
  Joseph
  Freedman

  
	
   

  	
  Title:

  	
  Vice
  President

  



 


Signature Page to Management Services Agreement