Exhibit 10.4


 


FORM OF PURCHASE AGREEMENT





BY AND AMONG





DIESEL LTD.,



LNR PROPERTY CORPORATION 



AND



LNR CAPITAL CORPORATION





DATED AS OF [          ],
200[  ]


 





















 


TABLE OF CONTENTS


 


	
  ARTICLE I DEFINITIONS

  	
   

  
	
  Section 1.1

  	
  Definitions

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II PURCHASE AND SALE

  	
   

  
	
  Section 2.1

  	
  Purchase and Sale of CDO Interests

  	
   

  
	
  Section 2.2

  	
  Assumption of Liabilities

  	
   

  
	
  Section 2.3

  	
  Purchase
  Price

  	
   

  
	
  Section 2.4

  	
  The
  Closing

  	
   

  
	
  Section 2.5

  	
  Closing Deliveries

  	
   

  
	
  Section 2.6

  	
  Interest

  	
   

  
	
  Section 2.7

  	
  [CDO Documents Not Assigned

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE III REPRESENTATIONS AND WARRANTIES OF SELLERS

  	
   

  
	
  Section 3.1

  	
  Organization and Authority

  	
   

  
	
  Section 3.2

  	
  Authorization; Execution and Delivery;
  Valid and Binding Agreement

  	
   

  
	
  Section 3.3

  	
  Noncontravention

  	
   

  
	
  Section 3.4

  	
  Title to the Acquired Assets

  	
   

  
	
  Section 3.5

  	
  LNR Common Stock

  	
   

  
	
  Section 3.6

  	
  Compliance with Laws

  	
   

  
	
  Section 3.7

  	
  Litigation

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV REPRESENTATIONS AND WARRANTIES OF BUYER

  	
   

  
	
  Section 4.1

  	
  Organization of Buyer

  	
   

  
	
  Section 4.2

  	
  Authorization; Execution and Delivery;
  Valid and Binding Agreement

  	
   

  
	
  Section 4.3

  	
  Noncontravention

  	
   

  
	
  Section 4.4

  	
  Certain Securities Law Matters

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE V COVENANTS OF THE PARTIES

  	
   

  
	
  Section 5.1

  	
  Consents and Approvals

  	
   

  
	
  Section 5.2

  	
  Further Assurances

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI SURVIVAL AND INDEMNITY

  	
   

  
	
  Section 6.1

  	
  Survival

  	
   

  
	
  Section 6.2

  	
  Indemnification by Sellers

  	
   

  
	
  Section 6.3

  	
  Indemnification by the Buyer

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII MISCELLANEOUS

  	
   

  
	
  Section 7.1

  	
  Press Releases and Public Announcements

  	
   

  
	
  Section 7.2

  	
  No Third-Party Beneficiaries

  	
   

  
	
  Section 7.3

  	
  Entire
  Agreement

  	
   

  
	
  Section 7.4

  	
  Succession and Assignment

  	
   

  
	
  Section 7.5

  	
  Counterparts

  	
   

  
	
  Section 7.6

  	
  Headings

  	
   

  
	
  Section 7.7

  	
  Notices

  	
   

  
	
  Section 7.8

  	
  Waiver of Jury Trial

  	
   

  
	
  Section 7.9

  	
  Amendments and Waivers

  	
   

  
	
  Section 7.10

  	
  Severability

  	
   

  



 


i





















 


	
  Section 7.11

  	
  Construction

  	
   

  
	
   

  	
   

  
	
  Exhibits

  	
  Exhibit Name

  	
   

  
	
   

  	
   

  
	
  A

  	
  CDO Interests

  	
   

  
					



 


ii





















 


FORM OF
PURCHASE AGREEMENT


 


PURCHASE
AGREEMENT dated as of [               ],
200[ ] (this “Agreement”), by and between Diesel Ltd., a Bermuda
exempted company (“Diesel”), LNR Property Corporation, a Delaware
corporation (“LNR Property”, and together with Diesel, “Sellers”)
and LNR Capital Corporation, a Maryland corporation (“Buyer”).  Sellers and Buyer are referred to
collectively herein as the “Parties.”


 


WHEREAS,
Diesel owns all right, title and interest in the assets set forth on Exhibit A
attached hereto (the “CDO Interests”);


 


WHEREAS, LNR
Property owns all right, title and interest in all of the issued and
outstanding shares of common stock of LNR DSHI Legacy, Inc., a Florida
corporation (the “LNR Sub Common Stock” and, together with the CDO
Interests, the “Interests”); and


 


WHEREAS,
Sellers desire to sell and assign to Buyer, and Buyer desires to purchase and
assume from Sellers, in accordance with the terms and conditions of this
Agreement, all of the Sellers’ right title and interest in the Acquired Assets
(as defined below) and the Assumed Liabilities (as defined below);


 


NOW,
THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements set forth in this
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties agree as follows:


 


ARTICLE I



DEFINITIONS


 


Section 1.1             Definitions.  The following terms have the respective
meanings ascribed thereto below:


 


“Acquired
Assets” means, collectively, all of Sellers’ right, title, and interest in
and to the following:  (a) the
Interests and (b) cash in the aggregate amount collected by Diesel
relating to the CDO Interests (whether pursuant to the terms thereof, or
dispositions thereof or otherwise) from and after the Closing Date.


 


“Affiliate”
has the meaning set forth in Rule 12b-2 of the regulations promulgated
under the Securities Exchange Act of 1934, as amended.


 


“Agreement”
has the meaning set forth in the Preamble to this Agreement.


 


“Assumed
Liabilities” means, other than the Excluded Liabilities, all Liabilities of
the Sellers solely arising out of the Interests, including obligations arising
under swaps relating to the Interests, on or after the Closing Date.


 


“Business
Day” shall mean any day other than Saturday, Sunday or any other day on
which banks in New York, New York are permitted or required to be closed.


 





















 


“Buyer”
has the meaning set forth in the Preamble to this Agreement.


 


“Buyer
Indemnified Parties” has the meaning set forth in Section 6.2.


 


“CDO”
means a collateralized debt obligation issued by a special purpose entity
established for the purpose of issuing notes and preferred equity interests
that are secured by debt issued by various real estate investment trusts,
investment grade and non-investment grade commercial mortgage-backed
securities, and other real estate-related collateral.


 


“CDO
Documents” means, with respect to the CDO Interests, all agreements,
contracts and instruments relating to the creation, distribution, transfer,
ownership and management of such CDO Interests and the CDO from which such CDO
Interest is derived, including, without limitation, the following: (i) all
custody and administration agreements, indentures, notes, preferred equity
interests, fiscal agency agreements, hedge agreements, purchase agreements,
transfer agent agreements and similar agreements or arrangements (other than
agreements, contracts and commitments relating to investments underlying the
CDO); and (ii) all investment advisory, management, collateral management,
disposition consultant, servicing, administration and similar agreements by
which the relevant CDO is bound; and (iii) all private placement
memoranda, offering circulars or other offering material with respect to the
offering for sale of the CDO.


 


“CDO
Interests” has the meaning set forth in the Recitals to this Agreement.


 


“Closing”
has the meaning set forth in Section 2.4.


 


“Closing
Date” means the date hereof.


 


“Contemplated
Transactions” means the sale, assignment, transfer, conveyance and delivery
by the Sellers for the Purchase Price, and the acquisition by the Buyer of the
Acquired Assets and the assumption by the Buyer of the Assumed Liabilities.


 


“Diesel”
has the meaning set forth in the Preamble to this Agreement.


 


“Diesel
Purchase Price” has the meaning set forth in 2.3(a).


 


“Excluded
Liabilities” means all Liabilities of the Sellers pertaining to the
Interests arising out of, or relating to, any period, event, action or omission
prior to the Closing Date as specifically set forth in Schedule 1
attached hereto..


 


“Governmental
Authority” means any: (i) nation, state, county, city, town, village,
district, or other jurisdiction of any nature; (ii) federal, state, local,
municipal, foreign, or other government; (iii) governmental or
quasi-governmental authority of any nature (including any governmental agency,
branch, department, official, or entity and any court or other tribunal); or (iv) body
exercising, or entitled to exercise, any administrative, executive, judicial,
legislative, police, regulatory, or taxing authority or power of any nature.


 


“Law”
has the meaning set forth in Section 3.3.


 


2





















 


“Liability”
means any debt, claim, obligation or liability (whether known or unknown,
whether asserted or unasserted, whether absolute or contingent, whether accrued
or unaccrued, whether liquidated or unliquidated, and whether due or to become
due).


 


“Lien”
means any lien, charge, option, pledge, assignment, mortgage, security
interest, preemptive right, right of first refusal or encumbrance of any kind.


 


“Loss”
means any actual loss, liability, obligation, payment, assessment, costs or
expenses, including without limitation interest, penalties, fines, and
reasonable attorneys’ fees and expenses (including those incurred in connection
with the enforcement of a Party’s right to indemnification hereunder);
provided, however, that in no event shall the term “Loss” include punitive,
special, indirect, consequential or other damages other than direct damages.


 


“LNR
Property” has the meaning set forth in the Preamble to this Agreement.


 


“LNR Sub
Common Stock” has the meaning set forth in the Recitals to this Agreement.


 


“LNR Sub
Purchase Price” has the meaning set forth in 2.3(a).


 


“Organizational
Documents” means (a) the articles or certificate of incorporation and
the bylaws of a corporation; (b) the partnership agreement and any
statement of partnership of a general partnership; (c) the limited
partnership agreement and the certificate of limited partnership of a limited
partnership; (d) the certificate of formation and operating agreement of a
limited liability company; (e) any charter, bylaw, operating agreement or
similar document not described in (a) through (d) above adopted or
filed in connection with the creation, formation, organization or operation of
a Person, including the foreign equivalent thereof with respect to non-US
Persons; and (f) any amendment or contemplated amendment to any of the
foregoing.


 


“Parties”
has the meaning set forth in the Preamble to this Agreement.


 


“Permitted
Lien” means any (i) Liens being contested by the Sellers in good faith
and for which appropriate reserves are reflected in the Sellers’ financial
statements, (ii) Liens for Taxes not yet due or payable, and (iii) Liens;
covenants; conditions; building, zoning or other restrictions; reservations;
rights; utility or other easements; encumbrances; encroachments; installments
of special assessments not yet due and payable; set-back requirements; and
other similar items generally applicable and/or affecting title to property of
a similar character, in each case that would not, individually or in the
aggregate, interfere with or diminish in a material and adverse manner the
Buyer’s use or ownership of the Interests.


 


“Person”
means an individual, a partnership, a corporation, a limited liability company,
an association, a joint stock company, a trust, a joint venture, an
unincorporated organization, or a Governmental Entity.


 


“Purchase
Price” means, collectively, the Diesel Purchase Price and the LNR Sub Purchase
Price.


 


3





















 


“Required
Transfer Documentation” means any documentation necessary to transfer and
assign the Interests and the Assumed Liabilities to the Buyer, including
without limitation any documentation required under the CDO Documents, and
other good and sufficient instruments of conveyance and transfer reasonably
necessary to vest in the Buyer all the legal and equitable, title and interest
of Sellers in the Interests and necessary to vest in the Buyer all legal
responsibility for the Assumed Liabilities.


 


“Securities
Act” means the Securities Act of 1933, as amended.


 


“Sellers”
has the meaning set forth in the Preamble to this Agreement.


 


“Sellers
Indemnified Parties” has the meaning set forth in Section 6.3.


 


ARTICLE II



PURCHASE AND SALE


 


Section 2.1             Purchase and Sale
of the Interests.  Upon the terms and
subject to the conditions set forth in this Agreement, on the Closing Date (as
defined below) the Sellers (as applicable) hereby agree to sell, convey,
transfer, assign and deliver to Buyer and Buyer hereby agrees to purchase from
each such  Sellers (as applicable) all of
the Sellers’ right, title and interest in and to the CDO Interests for the
Diesel Purchase Price (as defined below) and the LNR Sub Common Stock for the
LNR Sub Purchase Price (as defined below).


 


Section 2.2             Assumption of
Liabilities.  On and subject to the
terms and conditions of this Agreement and in consideration of the payment by
the Buyer of the Purchase Price, the Buyer hereby assumes and becomes
responsible for, and the Sellers hereby transfer, convey, and assign or causes
to be transferred, conveyed and assigned, to the Buyer, all of the Assumed
Liabilities.


 


Section 2.3             Purchase Price.  (a)  On the Closing Date, Buyer shall
pay to Diesel an amount equal to $[560,000,000] (the “Diesel Purchase Price”)
and shall pay to LNR Property an amount equal to $[          ] (the “LNR Sub Purchase Price”).


 


(b)           The
Diesel Purchase Price and the LNR Sub Purchase Price shall be paid by Buyer by
way of wire transfer of immediately available funds to the account(s) of
Sellers specified by Sellers to Buyer in writing.


 


Section 2.4             The Closing.  The closing of the transactions contemplated
by this Agreement (the “Closing”) is taking place in connection with the
consummation of the Buyer’s initial public offering of its common stock and
with the execution of this Agreement at the offices of Schulte Roth &
Zabel LLP, 919 Third Avenue, New York, New York 10022 or at such time and place
as the Parties shall mutually agree.  For
all purposes hereunder (a) the date of this Agreement shall be referred to
as the “Closing Date,” and (ii) the Closing shall be deemed to have
occurred at 11:59 p.m. on the Closing Date.


 


4





















 


Section 2.5             Closing Deliveries.  Contemporaneously herewith, and
simultaneously with the other Parties’ deliveries hereunder:


 


(a)           Sellers
shall deliver to Buyer:


 


(i)            the
Acquired Assets, including, without limitation, copies of, and all of the
Sellers’ right title and interest to, any CDO Documents in its possession or in
the possession of a third party custodian;


 


(ii)           the
Required Transfer Documentation, executed by the Sellers and, to the extent
required, any third party custodian;


 


(iii)          any
original notes, preferred shares or common stock, including the LNR Sub Common
Stock, duly endorsed in blank; and


 


(iv)          all
notices and instructions required to be delivered to DTC or any other holder of
a global note or entity that maintains the book entry registration system for
the CDO Interests, executed by the Sellers.


 


(b)           Buyer
shall deliver to Diesel:


 


(i)            the
Diesel Purchase Price; and


 


(ii)           any
Required Transfer Documentation, executed by the Buyer.


 


(c)           Buyer
shall deliver to LNR Property:


 


(i)            the
LNR Sub Purchase Price; and


 


(ii)           any
Required Transfer Documentation, executed by the Buyer.


 


Section 2.6             Interest.  Buyer agrees to transmit to Diesel any
accrued interest actually received by Buyer with respect to the CDO Interests
for the period prior to the Closing within 5 Business Days of the receipt
thereof by Buyer.  If accrued interest is
sent to Diesel with respect to the CDO Interests for the period following the
Closing, Diesel agrees to transmit any such accrued interest to Buyer within 5
Business Days of the receipt thereof by Diesel.


 


Section 2.7             CDO Interests Not
Assigned.  To
the extent that the transfer or assignment of any CDO Interests or CDO
Documents requires the consent of another party thereto, and such consent has
not been obtained as of the date hereof, then:


 


5





















 


(a)           this
Agreement shall not constitute an agreement to transfer or assign the same if
an assignment or attempted assignment constitutes a breach of such CDO Interests
or a violation of applicable law, unless the Buyer agrees to hold harmless
Sellers with respect thereto;


 


(b)           the
Parties agree to use reasonable commercial efforts to obtain the written
consent of the counterparties thereto with respect to the transfer or
assignment of such CDO Interests;


 


(c)           the
Parties shall in good faith negotiate to effectuate such arrangements as are
necessary to put the Parties in as close an economic position as they would be
in had the relevant consents been obtained and the relevant CDO Interests
assigned contemporaneously herewith.  The
Parties acknowledge and agree that any such arrangements could require, among
other things, (i) Sellers to remain subject to its obligations under any
CDO Interests with respect to which a consent to assignment is required under
the applicable contract but has not been delivered, (ii) the Buyer to
perform on behalf of Sellers the obligations of Sellers under such contract,
and to promptly reimburse Sellers for any and all reasonable out-of-pocket
costs, expenses or losses, including reasonable attorneys’ fees, incurred by
Sellers as a result of Sellers taking, at the request of the Buyer, legal or
other action on behalf of or for the benefit of the Buyer with respect to such
contracts or as a result of the Buyer’s failure to perform Sellers’ obligations
under such contracts arising on or after the Closing and to indemnify Sellers
for any Loss relating to the Buyer’s failure to so perform, (iii) Sellers
to promptly remit to the Buyer any payments or refunds received by Sellers from
any party under the applicable contract, (iv) Sellers to cooperate in any
lawful arrangement requested by the Buyer designed to provide the benefits of
the Acquired Assets to the Buyer, and (v) Sellers to enforce, at the request
of and for the account of and the expense of the Buyer, any rights of Sellers
arising from any such CDO Interests against any third party, including the
right to elect to terminate in accordance with the terms thereof upon the
advice of the Buyer, all in a manner consistent with the purposes and intent of
this Agreement; and


 


(d)           if
and when any such consent shall be obtained, Sellers shall promptly transfer or
assign, as applicable, such CDO Interests to the Buyer without payment of
additional consideration.


 


ARTICLE III



REPRESENTATIONS AND WARRANTIES

OF SELLERS


 


The Sellers
hereby represent and warrant to the Buyer, severally, and not jointly, as of
the date of this Agreement, as follows:


 


Section 3.1             Organization and
Authority.  Diesel is a corporation
duly formed, validly existing, and in good standing under the laws of Bermuda
with all requisite power and authority to execute and deliver this Agreement
and Required Transfer Documentation to be provided by it and to perform the
respective obligations to consummate the Contemplated Transactions hereunder
and thereunder applicable to it.  LNR
Property is a corporation duly formed, validly existing, and in good standing
under the laws of Delaware with all requisite


 


6





















 


power and authority to execute
and deliver this Agreement and Required Transfer Documentation to be provided
by it and to perform the respective obligations to consummate the Contemplated
Transactions hereunder and thereunder applicable to it.


 


Section 3.2             Execution and
Delivery; Valid and Binding Agreement.  
(a)   The execution, delivery
and performance by Sellers of this Agreement and the Required Transfer
Documentation, and the consummation of the Contemplated Transactions, have been
duly and validly authorized by all requisite corporate proceedings on the part
of Sellers, and no other corporate proceedings on the part of Sellers is
necessary to authorize the execution, delivery and performance by Sellers of
this Agreement or the Required Transfer Documentation.


 


(b)           This
Agreement has been duly executed and delivered by Sellers and, assuming that
this Agreement is the valid and binding agreement of the Buyer, constitutes a
valid and binding obligation upon Sellers, enforceable against Sellers in
accordance with its terms, except as such enforcement may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other laws of
general application affecting enforcement of creditors’ rights or by general
principles of equity.


 


Section 3.3             Noncontravention.  Neither the execution and the delivery of
this Agreement by Sellers, nor the consummation by Sellers of the Contemplated
Transactions, will (a) violate (i) any constitution, statute,
regulation, rule, injunction, judgment, order, decree, ruling, charge, or other
restriction (each, a “Law”) of any Governmental Entity to which Sellers
are subject, (ii) any provision of the Organizational Documents of
Sellers, or (iii) any agreement, indenture or instrument to which any of
the Sellers is a party, or (b) require Sellers to give any notice to, make
any filing with, or obtain any authorization, consent, or approval of any
Governmental Entity or other third party in order for Sellers to consummate the
Contemplated Transactions, except, in the case of the foregoing clauses (a)(i),
(a) (iii), and(b), for any such violations, conflicts, breaches, defaults,
rights of acceleration, terminations, cancellations, requirements or other
actions or notices that are not reasonably likely, individually or in the
aggregate, to result in a material adverse effect on the Acquired Assets, taken
as a whole, or the ability of the Sellers to consummate the Contemplated
Transactions.


 


Section 3.4             Title to the
Acquired Assets. As of the date of this Agreement, all of the Acquired
Assets are owned by Sellers and Sellers have good title to all of such Acquired
Assets, free and clear of Liens other than Permitted Liens.  At Closing, Sellers will transfer, and Buyer
will acquire, good and marketable title to the Acquired Assets, free and clear
of any Liens other than Permitted Liens.


 


Section 3.5             LNR Common Stock.
The LNR Common Stock has been validly issued, fully paid and non-assessable and
not subject to preemptive rights of stockholders.


 


Section 3.6             Compliance with
Laws. Sellers have been and are in compliance with all Laws applicable to
the Acquired Assets, except where such noncompliance would not result in any
change, event or circumstance that has or is reasonably likely, individually or
in the aggregate, to have a material adverse effect on the Acquired Assets,
taken as a whole or the ability of the Sellers to consummate the Contemplated
Transactions.


 


7





















 


Section 3.7             Litigation.  As of the date of this Agreement, there is no
action, suit, investigation or proceeding pending, or, to the knowledge of
Sellers, threatened against Sellers before any Governmental Entity specifically
relating to the ownership of the Acquired Assets.  Sellers have no pending action against any
third party relating specifically to the ownership of the Acquired Assets.  There are no unsatisfied judgments or
material outstanding orders, writs, injunctions, decrees, settlements,
stipulations or awards (whether rendered by a court or Governmental Entity or
by arbitration) against Sellers specifically relating to the ownership of the
Acquired Assets.  There is in effect no
temporary restraining order, injunction or similar equitable relief applicable
to Sellers prohibiting or seeking to prohibit consummation of the Contemplated
Transactions.


 


ARTICLE IV



REPRESENTATIONS AND WARRANTIES OF BUYER


 


The Buyer
hereby represents and warrants to the Sellers, as of the date of this
Agreement, as follows:


 


Section 4.1             Organization of
Buyer.  Buyer is a corporation duly
formed, validly existing, and in good standing under the laws of the State of
Maryland with all requisite power and authority to execute and deliver this
Agreement and Required Transfer Documentation and to perform the respective obligations
to consummate the Contemplated Transactions hereunder and thereunder applicable
to it.


 


Section 4.2             Execution and
Delivery; Valid and Binding Agreement. 
(a)   The execution, delivery
and performance by Buyer of this Agreement and the Required Transfer
Documentation to be delivered by it, and the consummation of the Contemplated
Transactions applicable to it, have been duly and validly authorized by all
requisite corporate proceedings on the part of Buyer, and no other corporate
proceedings on its part are necessary to authorize the execution, delivery and
performance of this Agreement or the 
Required Transfer Documentation to be delivered by it.


 


(b)           This
Agreement has been duly executed and delivered by Buyer and, assuming that this
Agreement is the valid and binding agreement of Sellers, constitutes the valid
and binding obligation of Buyer, enforceable against Buyer in accordance with
its terms, except as such enforcement may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws of general application
affecting enforcement of creditors’ rights or by general principles of equity.


 


Section 4.3             Noncontravention.  Neither the execution and the delivery of
this Agreement by the Buyer, nor the consummation by the Buyer of the
Contemplated Transactions, will (a) violate (i) any constitution,
statute, regulation, rule, injunction, judgment, order, decree, ruling, charge,
or other restriction (each, a “Law”) of any Governmental Entity to which
Buyer is subject, (ii) any provision of the Organizational Documents of
Buyer, or (iii) any agreement, indenture or instrument to which the Buyer
is a party, or (b) require Buyer to give any notice to,


 


8





















 


make any filing with, or obtain
any authorization, consent, or approval of any Governmental Entity or other
third party in order for Buyer to consummate the Contemplated Transactions,
except, in the case of the foregoing clauses (a)(i), (a)(iii) and(b), for
any such violations, conflicts, breaches, defaults, rights of acceleration,
terminations, cancellations, requirements or other actions or notices that are
not reasonably likely, individually or in the aggregate, to result in a
material adverse effect on the ability to consummate the Contemplated
Transactions.


 


Section 4.4             Certain Securities
Law Matters. (a)  Buyer is an “accredited investor” as such term is
defined in Regulation D promulgated under the Securities Act.  Buyer is acquiring the Interests for its own
account for investment and with no present intention of distributing or
reselling such securities or any part thereof in any transaction which would
constitute a “distribution” within the meaning of the Securities Act.  Buyer understands that the Interests have not
been registered under the Securities Act or any state securities laws and are
being transferred to Buyer in part, in reliance on the foregoing
representation.  Buyer understands that
the Interests may not be sold, transferred, offered for sale, pledged,
hypothecated or otherwise disposed of without registration under the Securities
Act and any applicable state securities laws, except pursuant to an exemption
from such registration under such Act and such laws.  Buyer is able to bear the economic risk of
holding the Interests for an indefinite period, and has knowledge and
experience in financial and business matters such that it is capable of
evaluating the risks of the investment in the Interests. Buyer has had the
opportunity to perform such due diligence regarding the Interests as deemed by
it to be reasonably necessary and appropriate in the circumstances, and except
for the specific representations and warranties set forth herein, is relying
solely upon its own due diligence and analysis of the economic, legal and tax
aspects of owning the Interests and consummating the Contemplated Transactions.


 


ARTICLE V



COVENANTS OF THE PARTIES


 


Section 5.1             Consents and
Approvals.  Subject to the terms
hereof, with respect to any consents, approvals or filings which have not been
obtained or made as of the date hereof, or which by the nature of the relevant
consent, approval or filing cannot be obtained or made prior to Closing, the
Parties shall use their respective commercially reasonable efforts to, as
promptly as practicable (i) take, or cause to be taken, all actions, and
do, or cause to be done, and to assist and cooperate with the other parties in
doing, all things necessary, proper or advisable to obtain such consents or
approvals (ii) make all necessary filings, and thereafter make any other
required submissions, with respect to this Agreement and the  Required Transfer Documentation required
under any applicable federal or state securities Laws and any other applicable
Law, and (iii) execute and/or deliver any additional instruments necessary
to fully carry out the purposes of this Agreement.  The Parties shall cooperate with each other
in connection with obtaining such consents or approvals or the making of all
such filings, including providing copies of all such documents to the
non-filing party and its advisors prior to filing.  The Parties shall use their respective
commercially reasonable efforts to furnish to each other all information
required for any application or other filing to be made pursuant to the rules and
regulations of any applicable Law in connection with any of the transactions
contemplated hereby.


 


9





















 


Section 5.2             Further Assurances.  The parties shall cooperate reasonably with
each other and with their respective representatives in connection with any
steps required to be taken as part of their respective obligations under this
Agreement, and shall (a) furnish upon request to each other such further
information; (b) execute and deliver to each other such other documents;
and (c) do such other acts and things, all as the other party may
reasonably request for the purpose of carrying out the intent of this
Agreement; provided, however, that neither Party shall be required to make any
material change to its business, expend any material funds or incur any other
material burden in order to comply with this Section 5.2.


 


ARTICLE VI



SURVIVAL AND INDEMNITY


 


Section 6.1             Survival.  All of the representations and warranties of
Sellers contained in Article III above, and all of the representations and
warranties of the Buyer contained in Article IV above, shall survive the
Closing hereunder and continue in full force and effect for a period of one
year following the Closing Date.  The
Parties’ respective covenants and agreements to be performed at or after the
Closing Date contained in this Agreement shall survive indefinitely unless
otherwise set forth herein.


 


Section 6.2             Indemnification by
Sellers.  Sellers agree to indemnify
the Buyer and its Affiliates and their officers, directors, managers, members,
employees and stockholders (collectively, the “Buyer Indemnified Parties”)
from, and hold them harmless against any Losses, which any of the Buyer
Indemnified Parties sustain that are caused by, arise out of or are a result of
any of the following: (i) any material breach of any of the
representations and warranties of Sellers contained in this Agreement (except
for those representations and warranties that are qualified by materiality, for
which the Sellers agree to indemnify for any breach); or (ii) any material
breach of, or failure to perform, any covenant or agreement of Sellers
contained in this Agreement.


 


Section 6.3             Indemnification by
the Buyer. Buyer agrees to indemnify Sellers, and its Affiliates, officers,
directors, managers, members, employees and stockholders (collectively, the “Sellers
Indemnified Parties”) from, and hold them harmless against, any Losses
which any of the Sellers Indemnified Parties suffer, sustain or become subject
to that are caused by or are a result of any of the following: (i) any
material breach of any of the representations and warranties of the Buyer
contained in this Agreement (except for those representations and warranties
that are qualified by materiality, for which the Buyer agrees to indemnify for
any breach), or (ii) any material breach of, or failure to perform, any
covenant or agreement of the Buyer contained in this Agreement, or (iii) the
Assumed Liabilities.


 


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ARTICLE VII


 


MISCELLANEOUS


 


Section 7.1             Press
Releases and Public Announcements. 
No Party shall issue any press release or make any public announcement
relating to the subject matter of this Agreement without the prior written
approval of the other Party; provided, however, that any Party may make any
public disclosure required by applicable Law (in which case the disclosing
Party will use commercially reasonable efforts to advise the other Party prior
to making the disclosure).


 


Section 7.2             No Third-Party
Beneficiaries.  Except as set forth in Article VI with
respect to Sellers Indemnified Parties and Buyer Indemnified Parties, this
Agreement shall not confer any rights or remedies upon any Person other than
the Parties and their respective successors and permitted assigns.


 


Section 7.3             Entire Agreement.  This Agreement constitutes the entire
agreement between the Parties and supersede any prior understandings,
agreements, or representations by or between the Parties, written or oral, to
the extent they related in any way to the subject matter hereof and thereof.


 


Section 7.4             Succession and
Assignment.  This Agreement shall be
binding upon and inure to the benefit of the Parties named herein and their
respective successors and permitted assigns. No Party may assign either this
Agreement or any of its rights, interests, or obligations hereunder without the
prior written approval of the other Party.


 


Section 7.5             Counterparts.  This Agreement may be executed in one or more
counterparts, and by different parties on different counterparts, each of which
shall be deemed an original but all of which together will constitute one and
the same instrument.


 


Section 7.6             Headings.  The section headings contained in this
Agreement are inserted for convenience only and shall not affect in any way the
meaning or interpretation of this Agreement.


 


Section 7.7             Notices.  All notices, requests, demands, claims, and
other communications hereunder will be in writing. Any notice, request, demand,
claim, or other communication hereunder shall be deemed duly given if (and then
three Business Days after) it is sent by registered or certified mail, return
receipt requested, postage prepaid, and addressed to the intended recipient as
set forth below:


 


If to Diesel:


 


Diesel Ltd.

c/o LNR Property Holdings Ltd.

1601 Washington Avenue, Suite 800


Miami Beach, Florida 33139

Attention: General Counsel

Facsimile: (305) 695-5500


 


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Copy to:


 


Schulte Roth & Zabel LLP


919 Third Avenue


New York, New York 10022

Facsimile: (212) 593-5955

Attention: André Weiss, Esq.


 


If to LNR Property:


 


LNR Property Corporation

c/o LNR Property Holdings Ltd.

1601 Washington Avenue, Suite 800


Miami Beach, Florida 33139

Attention: General Counsel

Facsimile: (305) 695-5500


 


Copy to:


 


Schulte Roth & Zabel LLP


919 Third Avenue


New York, New York 10022

Facsimile: (212) 593-5955

Attention: André Weiss, Esq.


 


If to the Buyer:


 


LNR Capital Corporation

c/o LNR Property Holdings Ltd.

1601 Washington Avenue, Suite 800


Miami Beach, Florida 33139

Attention: General Counsel

Facsimile: (305) 695-5500


 


Copy to:


 


Schulte Roth & Zabel LLP


919 Third Avenue


New York, New York 10022

Facsimile: (212) 593-5955

Attention: André Weiss, Esq.


 


Any Party may
send any notice, request, demand, claim, or other communication hereunder to
the intended recipient at the address set forth above using any other means
(including personal delivery, expedited courier, messenger service, telecopy,
telex, ordinary mail, or electronic mail), but no such notice, request, demand,
claim, or other communication shall be deemed to have been duly given unless
and until it actually is received by the intended


 


12





















 


recipient. Any Party may change the address to which notices, requests,
demands, claims, and other communications hereunder are to be delivered by
giving the other Party notice in the manner herein set forth.   This Agreement shall be governed by and
construed in accordance with the domestic laws of the State of New York without
giving effect to any choice or conflict of law provision or rule (whether
of the State of New York or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of New
York.  Any proceeding seeking to enforce
any provision of, or based on any right arising out of, this Agreement may only
be brought against any of the Parties in the courts of the State of New York,
County of New York, or, if it has or can acquire jurisdiction, in the United
States District Court for the Southern District of New York, and each of the
Parties consents to the jurisdiction of such courts (and of the appropriate
appellate courts) in any such action or proceeding and waives any objection to
venue laid therein.


 


Section 7.8             Waiver of Jury
Trial.  EACH PARTY ACKNOWLEDGES AND
AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY
TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING
OUT OF OR RELATING TO THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT.  EACH PARTY CERTIFIES AND
ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (B) EACH
SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER AND (C) EACH
SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS SET FORTH HEREIN.


 


Section 7.9             Amendments and
Waivers.  No amendment of any
provision of this Agreement shall be valid unless the same shall be in writing
and signed by the Parties.  No waiver by
any Party of any default, misrepresentation, or breach of warranty or covenant
hereunder, whether intentional or not, shall be deemed to extend to any prior
or subsequent default, misrepresentation, or breach of warranty or covenant
hereunder or affect in any way any rights arising by virtue of any prior or
subsequent such occurrence.


 


Section 7.10           Severability.  Any term or provision of this Agreement that
is invalid or unenforceable in any situation in any jurisdiction shall not
affect the validity or enforceability of the remaining terms and provisions
hereof or the validity or enforceability of the offending term or provision in
any other situation or in any other jurisdiction.


 


Section 7.11           Construction.
The Parties have participated jointly in the negotiation and drafting of this
Agreement. In the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as if drafted jointly by the Parties
and no presumption or burden of proof shall arise favoring or disfavoring any
Party by virtue of the authorship of any of the provisions of this Agreement.
Any reference to any federal, state, local, or foreign statute or law shall be
deemed also to refer to all rules and regulations promulgated


 


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thereunder, unless the context
requires otherwise. The word “including” means “including without limitation.”


 


[SIGNATURES ON FOLLOWING PAGE]


 


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IN WITNESS
WHEREOF, the Parties have executed this Agreement as of the date first above
written.


 


	
   

  	
  DIESEL LTD.

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  LNR PROPERTY CORPORATION

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  LNR CAPITAL CORPORATION

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 





















 


Exhibit A


 


[Diesel CDO Interests]