Document:

Exhibit 10.1

 

EQUITY PURCHASE AGREEMENT

 

This EQUITY PURCHASE
AGREEMENT (this “Agreement”), dated as of July 29, 2010, is entered
into by LNR Property Corporation (“Issuer”). Riley Holdco Corp. (“Holdco”)
and iStar Marlin LLC (“iStar”).

 

RECITALS

 

WHEREAS, iStar wishes
to purchase from Holdco 240 shares of common stock, par value $0.10 per share,
of Issuer held by Holdco (such common stock, the “Common Stock”) at the
Closing on the terms and conditions set forth herein;

 

WHEREAS, iStar wishes
to purchase, and Issuer wishes to issue, 2,398 shares of Common Stock (the
Common Stock to be acquired pursuant to this Agreement, the “Newly Issued
Common Stock”) at the Closing on the terms and conditions set forth herein;
and

 

WHEREAS, concurrently
with the execution and delivery of this Agreement: (i) each of Aozora
Investments LLC (“Aozora”). VNO LNR Holdco LLC (“VNO”), CBR I LLC
(“Cerberus”) and Opps VIIb LProp, L.P. (“Oaktree”; Cerberus,
Aozora, VNO, iStar and Oaktree, each a “Lead Investor” and,
collectively, the “Lead Investors”) are entering into equity purchase
agreements, each dated as of the date hereof, with Holdco and Issuer (such
equity purchase agreements, collectively, the “Other Equity Purchase
Agreements”), an execution version of each of which has been provided to
iStar simultaneously with the execution of this Agreement; (ii) each of
the Lead Investors, the other holders of the outstanding Senior Notes due 2015
issued by Holdco (such Senior Notes, the “Holdco Notes”; such other
holders, the “Seller Noteholders”), Holdco and LNR Property Holdings
Ltd. (“LNR Parent”) are entering into a Debt Purchase Agreement, dated
as of the date hereof (the “DPA”); (iii) a Limited Liability
Company Agreement has been negotiated among the Lead Investors and Issuer (the “LLC
Agreement”), which LLC Agreement would have effect from and after any
determination by the Board of Directors of Issuer to cause Issuer to convert to
a limited liability company (and after receipt of requisite consent from the
Lead Investors) (a “Conversion”), which LLC Agreement, among other
things, provides for certain rights of the Lead Investors in respect of fair
value options of LNR Partners, LLC; (iv) each of the Lead Investors is
entering into a Flow of Funds Agreement, dated as of the date hereof, with
Issuer and the other signatories thereto (the “Flow of Funds Agreement”);
and (v) each of the Lead Investors is entering into a governance agreement
with Issuer, dated as of the date hereof, requiring that, from and after the
Closing until such time (if any) that a Conversion is authorized and approved
as referenced in clause (iii) above, the terms of the LLC Agreement shall
be applied to the Issuer and the applicable rights of the Lead Investors
therein shall be applied to the Lead Investors, mutatis mutandis, adjusted solely as necessary to give
effect to the organizational form of the Issuer during such period as a
Delaware corporation.

 

NOW,
THEREFORE, in consideration of the mutual promises,
covenants, representations and warranties contained herein, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, each of iStar, Holdco and Issuer hereby agrees as follows:

 

 

1.  Definitions. For the purposes of this Agreement, the
following terms shall have the following respective meanings:

 

“Additional Holdco Notes”
means those Holdco Notes contemplated to be sold by the Seller Noteholders to
the Lead Investors (based on the applicable Lead Investor’s Pro Rata Share)
pursuant to and in accordance with the DPA.

 

“Capital Lease”
means, with respect to any Person, any lease of any property (whether real,
personal or mixed) by that Person as lessee that, in conformity with GAAP, is
or should be accounted for as a capital lease on the balance sheet of that
Person.

 

“Consolidated SPV
Subsidiary” means a Person as to which each of the following conditions has
been satisfied: (a) it holds as its primary assets collateralized debt
obligations, bank loans, mortgage loans, high yield securities, commercial
mortgage-backed securities or similar sccuritized debt or other obligations
(and ancillary assets and liabilities incidental to such holdings); (b) it
issues or has issued debt, securities or other interests that entitle the
holders thereof to receive payments that depend primarily on cash flow from, or
proceeds upon the sale of, the assets described in clause (a); (c) such
Person is,  or holds an interest in
a Person that is, a special purpose entity established for the limited purpose
of holding the assets described in clause (a) and issuing the debt,
securities and other obligations described in clause (b); and (d) LNR
Parent or one or more of its respective consolidated subsidiaries maintains an
interest in such Person, whether by holding securities issued by such Person,
managing the assets of such Person, advising such Person or otherwise, such
that such Person constitutes a consolidated subsidiary of LNR Parent pursuant
to GAAP.

 

“Contractual Obligation”
means, as applied to any Person, any provision of any security issued by that
Person or of any indenture, mortgage, deed of trust, contract, undertaking,
agreement, instrument or other document to which that Person is a party or by
which it or any of its properties is bound or to which it or any of its properties
is subject.

 

“GAAP” means
generally accepted accounting principles as in effect from time to time in the
United States of America, applied on a consistent basis both as to
classification of items and amounts.

 

“Governmental Authority”
means any arbiter or any federal, state, municipal, national, supranational or
other government, governmental department, commission, board, bureau, court,
agency or instrumentality or political subdivision thereof or any entity,
officer or examiner exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to any government or any court, in
each case whether associated with the United States of America, any State
thereof or the District of Columbia or a foreign entity or government.

 

‘‘Guarantors” means
DSHI Acquisition Corporation, Diesel Holdco Ltd. and each other Credit Party
(as defined in the Note Purchase Agreement), other than Holdco, and their
respective successors and permitted assigns.

 

“Historical Financial
Statements” means (a) the draft audited consolidated financial
statements of LNR Parent and its consolidated subsidiaries as of and for the
fiscal year

 

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ended November 30,
2009, consisting of a balance sheet and the related consolidated statements of
income, stockholders’ equity and cash flows for such fiscal year and (b) the
draft unaudited consolidated financial statements of LNR Parent and its
consolidated subsidiaries (excluding Consolidated SPV Subsidiaries other than
Madison Square Company LLC) as of and for the fiscal quarters ended February 28,
2010, and May 31, 2010, consisting of a balance sheet and the related
consolidated statements of income, stockholders’ equity and cash flows for such
fiscal quarters, in each case, a copy of which is attached hereto as Exhibit A
and Exhibit B, respectively.

 

“Law” means any
federal, state, local, foreign or supranational law, statute or ordinance,
common law, or any rule, regulation, judgment, order, writ, injunction, decree,
arbitration award, agency requirement, license or permit of any Governmental
Authority.

 

“Lien” means, with
respect to any Person, any security interest, mortgage, pledge, hypothecation,
lien, claim, charge, prior claim, encumbrance, assignment, regulatory right,
trust, conditional sale or title retention agreement, lessor’s interest under a
Capital Lease or analogous instrument, in, of or on such Person’s property
(whether held on the date hereof or hereafter acquired), or any signed or filed
financing statement which names such Person as the debtor, or the execution of
any security agreement or the like authorizing any other Person as the secured
party thereunder to file such a financing statement.

 

“Note Documents”
means, collectively, the Note Purchase Agreement, Holdco Notes and all other
agreements, guarantees and instruments executed and delivered pursuant to or in
connection therewith, as any of the foregoing may from time to time be amended,
modified or supplemented in accordance with its terms.

 

“Note Purchase Agreement”
means the Note Purchase Agreement, dated as of February 3, 2005, as
amended from time to time, by and among Holdco, LNR Parent and the other
parties thereto.

 

“Organizational Documents”
means, as to any Person, its certificate or articles of incorporation or
by-laws, its partnership agreement, its certificate of formation and operating
agreement and/or other organizational or governing documents of such Person.

 

“Permitted Lien”
means any Lien permitted under the terms of the Note Purchase Agreement.

 

“Person” means and
includes an individual, a partnership, a joint venture, an association, a
limited liability company, a corporation, a trust, a syndicate, an
unincorporated organization and any Governmental Authority.

 

“Securities Act”
means as of any date the Securities Act of 1933, as amended, or any similar
federal Statute then in effect, and a reference to a particular section thereof
shall include a reference to the comparable section, if any, of any such
similar federal Statute.

 

“Subsidiary” means,
with respect to any Person, any corporation or other entity of which at least a
majority of the outstanding voting stock is at the time directly or indirectly
owned or controlled by such Person or by one or more of any entities directly
or indirectly

 

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owned or controlled by such
Person. For the purposes of this definition, “control” of a Person shall mean
the possession, directly or indirectly, of the power to direct or cause the direction
of its management or policies, whether through the ownership of voting
securities, by contract or otherwise, and not merely a veto right in any
decision or a right to vote on matters in the nature of “major decisions.”

 

“Statute” means any
statute, ordinance, code, treaty, directive, Law (civil or criminal), rule or
regulation of any Governmental Authority.

 

“Transferred Rights”
means, with respect to any Holdco Notes owned by iStar, all right, title and
interest in, to and under such Holdco Notes, and under each of the Note
Purchase Agreement and the other Note Documents in respect of such Holdco Notes
and in the obligations of Holdco and Guarantors thereunder, including, without
limitation (a) all amounts (including, without limitation, any payment-in-kind
interest, fees or other amounts paid or payable in kind in connection with such
Holdco Notes pursuant to the Note Documents) payable to iStar under the Note
Documents, and all obligations owed to iStar in connection with such Holdco
Notes (including, without limitation, obligations in respect of the guarantee
of each Guarantor contained in the Note Purchase Agreement), (b) all
claims (including “claims” as defined in Bankruptcy Code §101(5)), suits,
causes of action under the Note Purchase Agreement and the other Note
Documents, and (c) all other rights of iStar, whether known or unknown,
against Holdco or any Credit Party, or any of their respective affiliates,
agents, representatives, contractors, advisors, or any other Person that in any
way is based upon, arises out of or is related to any of the foregoing.

 

2. Purchase of Common Stock from Holdco.

 

(a) At the Closing, and
upon the terms and subject to the conditions set forth in this Agreement,
Holdco agrees to sell to iStar, and iStar agrees to purchase from Holdco, 240
shares of Common Stock held by Holdco (the “Secondary Common Stock”) in
exchange for (i) the $100,000,000 aggregate principal amount of Holdco
Notes owned by iStar as of the date hereof (the “iStar Holdco Notes”)
(and the related Transferred Rights), and (ii) iStar’s Pro Rata Share (as
defined in the DPA) of the Additional Holdco Notes (and the related Transferred
Rights), which, in each case, shall be transferred to Holdco free and clear of
any Liens.

 

(b) iStar hereby
irrevocably consents to the amendment of any provision of the Note Documents
necessary to give effect to the transactions contemplated by this Agreement.

 

3. Purchase and Issuance of Common Stock from Issuer.
At the Closing, upon the terms and subject to the conditions set forth in this
Agreement, Issuer agrees to issue and sell to iStar, and iStar agrees to
purchase from Issuer, the Newly Issued Common Stock in exchange for (i) $94,337,486
in cash (the “Cash Purchase Price”), and (ii) the Secondary Common
Stock which, in the case of clause (ii), shall be transferred to Issuer free
and clear of any Liens.

 

4. The Closing.

 

(a) The date (the “Closing
Date”) and time of the consummation of the transactions contemplated by
this Agreement (the “Closing”) shall be 10:30 a.m., New York City

 

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time, on July 28, 2010,
subject to the satisfaction or waiver of the applicable conditions set forth in
this Agreement (other than those conditions that by their nature are to be
satisfied at the Closing, but subject to the fulfillment or waiver of those
conditions) or, o the extent such conditions arc not satisfied or waived by
such date, on the second business day after such conditions have been satisfied
(or waived) or such other date and time as is mutually agreed to by iStar,
Holdco and Issuer. The Closing shall occur at the offices of Schulte Roth &
Zabel LLP, 919 Third Avenue, New York, New York 10022.

 

(b) At
the Closing:

 

(i) iStar
shall deliver or cause to be delivered to Holdco the (x) iStar Holdco
Notes duly and validly endorsed for transfer and assignment, and (y) iStar’s
Pro Rata Share of the Additional Holdco Notes;

 

(ii) Holdco
shall deliver to iStar the Secondary Common Stock duly and validly endorsed for
transfer and assignment;

 

(iii) iStar
shall pay or deliver (as applicable) or cause to be paid or delivered (as
applicable) to Issuer (x) the Cash Purchase Price by wire transfer of
immediately available funds, and (y) the Secondary Common Stock duly and
validly endorsed for transfer and assignment;

 

(iv) Issuer
shall deliver to iStar a certificate representing the Newly Issued Common Stock
and record in its register of stockholders the issuance of such Newly Issued
Common Stock and ownership thereof by iStar;

 

(v) Issuer
shall use the Cash Purchase Price, together with the cash purchase price
required to be paid pursuant to each Other Equity Purchase Agreement with the
Lead Investors and a portion of cash on hand, to pay concurrently with the
consummation of the transactions contemplated by this Agreement $474,038,995.41
in respect of Loans outstanding under the Credit and Guaranty Agreement, dated
as of July 12, 2006, as amended from time to time (the “Senior Credit
Facility”), by and among LNR, LNR Parent, Deutsche Bank AG, New York
Branch, as administrative agent and collateral agent and the other parties
thereto (the “Senior Loan Repayment”), of which (A) $426,680,137.29
(representing the total amortization payment due at the Closing net of the
amount owed to LNR Delta Opco Ltd.) (the “Net Senior Loan Repayment”)
shall be paid to Deutsche Bank AG, New York Branch, as Administrative Agent and
(B) the remainder shall be deemed to have been paid to LNR Delta Opco Ltd.
in respect of its pro rata interest in the Senior Loan Repayment;

 

(vi) Each
of iStar, Holdco and Issuer shall deliver such other certificates, instruments
and/or documents reasonably requested by the other necessary to consummate the
transactions contemplated by this Agreement; and

 

(vii) Holdco
shall deliver to the Issuer a fully-executed designation, in the form annexed
as Exhibit C hereto, designating the Subsidiary of the Issuer
listed on such Exhibit as a substitute agent for all taxable years and for
all matters related to tax of the consolidated group of which Holdco is the
common parent, pursuant to Treasury Regulation section 1.1502-77(d) and
section 7 of Revenue Procedure 2002-43, which designation may be

 

5

 

filed by Issuer or such
Subsidiary with the Internal Revenue Service in the Issuer’s sole discretion at
any time.

 

(c) On, before, and
after Closing, as and to the extent requested by the Issuer, Holdco shall
designate (and shall cooperate with the Issuer in designating) one of the
Subsidiaries of the Issuer, acceptable to the Issuer, as a substitute agent (or
equivalent) for all taxable years and for all matters related to tax of any
consolidated or combined group of which Holdco has heretofore been a member or
common parent, all in accordance with the requirements of any state, local, or
foreign law similar in effect to Treasury Regulation section 1.1502-77(d). If
the appropriate tax authorities fail to approve any substitute agent designated
pursuant to Section 4(b)(vii) or this Section 4(c),
Holdco shall designate (and shall cooperate with the Issuer in designating)
other Subsidiaries of the Issuer acceptable to the Issuer until a substitute
agent is accepted by the appropriate tax authorities.

 

5. Representations and Warranties of iStar.
iStar hereby represents and warrants to each of Holdco and Issuer as of the
date hereof and as of the Closing Date (except with respect to a representation
or warranty  set forth below that
addresses matters as of a particular date, which representations and warranties
shall be made only as of such date) as follows:

 

(a) Organization;
Authorization; Enforcement; Validity. iStar is duly organized, validly
existing and in good standing (or the equivalent) under the Laws of its
jurisdiction of organization. iStar has the requisite power and authority to
enter into and perform its obligations under this Agreement. The execution,
delivery and performance of this Agreement by iStar and the consummation by
iStar of the transactions contemplated hereby have been duly authorized by
iStar. This Agreement has been duly executed and delivered by iStar and is the
legally valid and binding obligation of iStar, enforceable against iStar in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar Laws relating to
or limiting creditors’ rights generally or by equitable principles affecting
enforceability.

 

(b) No Conflicts.
The execution, delivery and performance by iStar of this Agreement and the
consummation of the transactions contemplated hereby, do not and will not (i) violate
(x) any provision of any Law applicable to iStar, (y) any of the
organizational documents of iStar, or (z) any order, judgment or decree of
any court or other Governmental Authority binding on iStar, except in the case
of clauses (x) and (z) to the extent such violation could not
reasonably be expected to have, individually or in the aggregate, a material
adverse effect on the authority or ability of iStar to perform its obligations
hereunder, including the payment or delivery, as applicable, of the Cash
Purchase Price, iStar Holdco Notes, iStar’s Pro Rata Share of the Additional
Holdco Notes and the Secondary Common Stock at the Closing (an “iStar
Material Adverse Effect”); (ii) conflict with, result in a breach of
or constitute (with due notice or lapse of time or both) a default under any
Contractual Obligation of iStar, except to the extent such conflict, breach or
default could not reasonably be expected to have, individually or in the aggregate,
an iStar Material Adverse Effect; (iii) result in or require the creation
or imposition of any material Lien upon any of the material properties of iStar
or (iv) require any approval of equityholders, members or partners or any
approval or consent of any Person under any Contractual Obligation of iStar
except for such approvals or consents (x) that will be

 

6

 

 

 

obtained on or before the
Closing or (y) the failure of which to obtain could not reasonably be
expected to have, individually or in the aggregate, an iStar Material Adverse
Effect.

 

(c) Adverse
Proceedings. There is no action, suit, proceeding, hearing or governmental
investigation or arbitration, in each case whether administrative, judicial or
otherwise (each, an “Adverse Proceeding”), by or before any Governmental
Authority, that is pending or, to the knowledge of iStar, threatened against or
involving iStar or any assets of iStar that could reasonably be expected to
have, individually or in the aggregate, an iStar Material Adverse Effect. There
is no Adverse Proceeding, by or before any Governmental Authority, that is
pending or, to the knowledge of iStar, threatened against iStar that seeks to
enjoin, or otherwise prevent the consummation of, any of the transactions
contemplated herein or to recover any damages or obtain any relief as a result
of any of the transactions contemplated herein. iStar is not (i) in
violation of any applicable Laws that could reasonably be expected to have,
individually or in the aggregate, an iStar Material Adverse Effect, or (ii) subject
to or in default with respect to any final judgments, writs, injunctions,
decrees, rules or regulations of any court or Governmental Authority, that
could reasonably be expected to have, individually or in the aggregate, an
iStar Material Adverse Effect.

 

(d) Title to the
Secondary Common Stock. iStar Holdco Note and Additional Holdco Notes.
At the Closing, iStar will transfer the Secondary Common Stock to Issuer (i) with
such title as iStar shall have received from Holdco at the Closing and (ii) free
and clear of all Liens attributable to iStar. iStar has good, legal and
marketable title to the iStar Holdco Notes (and the related Transferred
Rights), free and clear of all Liens. At the Closing, iStar will transfer to
Issuer its Pro Rata Share of the Additional Holdco Notes (and the related
Transferred Rights) (i) with such title as iStar shall have received from
the Seller Noteholders pursuant to the DPA and (ii) free and clear of all
Liens attributable to iStar. Prior to Closing, iStar has not, directly or
indirectly, assigned, conveyed or transferred to any Person any rights
(including any claims, suits and causes of action) pertaining to the Secondary
Common Stock, iStar Holdco Notes (or any of the related Transferred Rights),
its Pro Rata Share of the Additional Holdco Notes (or any of the related
Transferred Rights) or otherwise granted to (with or without notice or lapse of
time) any Person any rights in respect of the Secondary Common Stock, iStar
Holdco Notes (or any of the related Transferred Rights) or its Pro Rata Share
of the Additional Holdco Notes (or any of the related Transferred Rights).

 

(e) Nature of
Acquisition of Common Stock.

 

(i) Except
as otherwise expressly contemplated by this Agreement, iStar is acquiring all
Common Stock hereunder for its own account and not with a view to or for resale
in connection with any distribution of such iStar Common Stock in violation of
the Securities Act. iStar acknowledges and understands that the Common Stock to
be acquired pursuant to this Agreement have not been registered under the
Securities Act or the securities laws of any state and are issued by reason of
specific exemptions from registration under the provisions thereof which depend
in part upon the investment intent of iStar and upon the other representations
made by iStar in this Agreement. iStar (a) has knowledge, sophistication and
experience in business and financial matters that it is capable of evaluating
the merits and risks of the transactions contemplated by this Agreement, (b) has
been given full access to the records of Issuer and has had an opportunity to
ask questions and receive answers from Issuer

 

7

 

regarding the transactions
contemplated hereby and the business, assets, results of operations or
financial condition of Issuer and its Subsidiaries as it has deemed necessary
and appropriate to conduct its due diligence investigation with respect to the
Common Stock, and Issuer has not refused any reasonable request made by iStar
to provide such information, (c) is an “accredited investor” as defined in
Rule 501(a) of Regulation D under the Securities Act and will be at
the time of the consummation of the transactions contemplated by this
Agreement, (d) has not relied on any Person in connection with its
investigation of the accuracy or sufficiency of such information or its
investment decision, (e) fully understands the nature, scope and duration
of the limitations applicable to the Common Stock and (f) is able to bear
the risk of the investment in the Common Stock for an indefinite period of
time.

 

(ii) In
connection with the due diligence investigation of Issuer by iStar. iStar has
received and may continue to receive from Issuer certain estimates,
projections, forecasts and other forward-looking information, as well as
certain business plan information, regarding Issuer and its business and
operations. iStar hereby acknowledges that there are uncertainties inherent in
attempting to make such estimates, projections, forecasts and other
forward-looking statements, as well as in such business plans, with which iStar
is familiar, that iStar is taking full responsibility for making their own
evaluation of the adequacy and accuracy of all estimates, projections,
forecasts and other forward-looking information, as well as such business
plans, so furnished to them (including the reasonableness of the assumptions
underlying such estimates, projections, forecasts, forward-looking information
or business plans), and that iStar will have no claim against Issuer, any of
its Subsidiaries or any of its other affiliates, or any of their respective
equityholders, directors, officers, employees, affiliates, advisors, agents or
representatives, with respect thereto. Accordingly, iStar hereby acknowledges
that none of Issuer, any of its Subsidiaries or any of their affiliates, nor
any of their respective equityholders, directors, officers, employees,
affiliates, advisors, agents or representatives, has made or is making any
representation or warranty with respect to such estimates, projections,
forecasts, forward-looking statements or business plans (including the
reasonableness of the assumptions underlying such estimates, projections,
forecasts, forward-looking statements or business plans). Notwithstanding
anything to the contrary in this paragraph, iStar acknowledges and agrees that (i) Issuer
and its affiliates currently may have or may come into possession of, certain
non-public information or financial projections (“Excluded Information”)
with respect to Issuer and its affiliates that is not known to iStar and that
may be material to a decision to enter into this Agreement, and that may have
been or may be provided to certain other participants in connection with the
transactions contemplated by this Agreement, (ii) iStar has determined to
execute and deliver this Agreement and agree to perform its obligations
hereunder notwithstanding the foregoing and (iii) iStar shall not assert
or claim, directly or indirectly, that failing to receive the Excluded
Information in any manner impairs the validity or enforceability of this
Agreement or the obligations of iStar hereunder or otherwise shall result in
any liability of Issuer, any of its Subsidiaries or any of their affiliates,
nor any of their respective equityholders, directors, officers, employees,
affiliates, advisors, agents or representatives with respect thereto.

 

(f) No Other
Representations or Warranties. Except for the representations and
warranties of Issuer and Holdco expressly set forth in this Agreement, iStar
hereby acknowledges that none of Issuer, Holdco or any of their respective affiliates,
directors, officers,

 

8

 

employees, advisors, agents
or representatives, nor any other Person, has made or is making any other
express or implied representation or warranty with respect to the transactions
contemplated hereby. Except for the representations and warranties of Issuer
and Holdco expressly set forth in this Agreement, none of Holdco, Issuer,
any of their respective Subsidiaries or any of their affiliates, nor any of
their respective equityholders, directors, officers, employees, affiliates,
advisors, agents or representatives, will have or be subject to any liability
or indemnification obligation to iStar resulting from the delivery,
dissemination or any other distribution to iStar or its equityholders,
directors, officers, employees, affiliates or representatives, or the use by
iStar or its equityholders, directors, officers, employees, affiliates or
representatives of any information, documents or other material provided or
made available to iStar or its equityholders, directors, officers, employees,
affiliates or representatives, including without limitation in any “data room,”
in anticipation or contemplation of any of the transactions contemplated by
this Agreement.

 

6. Representations and Warranties of Issuer.  Except
as set  forth in the corresponding
section or subsections of the disclosure letter (the “Disclosure Letter”)
delivered to iStar prior to entering into this Agreement (provided, that
a matter disclosed with respect to one representation or warranty will also be
deemed to be disclosed with respect to each other representation or warranty to
which the matter disclosed reasonably relates, to the extent such relationship
is reasonably apparent on the face of the disclosure contained in the
Disclosure Letter with respect to such matter). Issuer hereby represents and
warrants to iStar as of the date hereof and as of the Closing Date (except with
respect to a representation or warranty set forth below that addresses matters
as of a particular date, which representations and warranties shall be made
only as of such date) as follows:

 

(a) Organization;
Authorization; Enforcement; Validity. Issuer and each of its Subsidiaries
is duly organized, validly existing and in good standing (or the equivalent)
under the Laws of its jurisdiction of organization and is duly qualified to do
business in each additional jurisdiction where the failure to so qualify could
not reasonably be expected to have, individually or in the aggregate, a material
adverse effect on (i) the authority or ability of Issuer to perform its
obligations hereunder or (ii) the business, properties, assets,
liabilities or financial condition of Issuer and its Subsidiaries, taken as a
whole (an “Issuer Material Adverse Effect”). Issuer and each of its
Subsidiaries has all requisite organizational powers to own its properties and
to carry on its business as now being conducted and as proposed to be
conducted, other than such powers the absence of which has not had and could not
reasonably be expected to have an Issuer Material Adverse Effect. The
execution, delivery and performance of this Agreement by Issuer and the
consummation by Issuer of the transactions contemplated hereby have been duly
authorized by Issuer. This Agreement has been duly executed and delivered by
Issuer and is the legally valid and binding obligation of Issuer, enforceable
against Issuer in accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar Laws
relating to or limiting creditors, rights generally or by equitable principles
affecting enforceability.

 

(b) Capital Stock.
As of the Closing and assuming the consummation of the transactions
contemplated by this Agreement and the Other Equity Purchase Agreements:

 

9

 

(i) The
authorized capital stock of Issuer consists solely of 10,000 shares of Common
Stock, all of which are issued and outstanding. Such shares of Common Stock
were duly authorized, validly issued, fully paid and nonassessable and have
been issued hereunder or pursuant to one of the Other Equity Purchase
Agreements.

 

(ii) There
are no existing options, warrants, calls, rights, commitments or other
agreements by which Issuer is bound, and there is no other membership interest
or other capital stock of Issuer outstanding which upon conversion or exchange
would require, the issuance by Issuer of any additional membership interests or
other capital stock or other securities convertible into, exchangeable for or
evidencing the right to subscribe for or purchase, a membership interest or
other capital stock of Issuer. As of the Closing, there are no existing
options, warrants, calls, rights, commitments or other agreements by which any
of Issuer’s Subsidiaries are bound, and there are no other membership interests
or other capital stock of any of Issuer’s Subsidiaries outstanding which upon
conversion or exchange would require, the issuance by any of Issuer’s
Subsidiaries of any additional membership interests or other capital stock or
other securities convertible into, exchangeable for or evidencing the right to
subscribe for or purchase, their respective membership interests or other
capital stock. Issuer owns, and, as of the Closing, will own, all outstanding
capital stock of each of its Subsidiaries.

 

(iii) The
issuance of all Common Stock contemplated to be acquired by iStar under this
Agreement was duly authorized by Issuer and is validly issued and outstanding,
fully paid and nonassessable, and free and clear of all Liens, other than
transfer restrictions of general applicability as may be provided under the
Securities Act and other applicable securities laws. Assuming the accuracy of
iStar’s representations and warranties in this Agreement, the issuance by
Issuer of the Newly Issued Common Stock is exempt from registration under the
Securities Act.

 

The Common Stock
contemplated to be acquired by iStar under this Agreement represents 23.98% of
the Common Stock outstanding as of the Closing. Exhibit D hereto
sets forth a true and correct capitalization table of Issuer.

 

(c) No Conflicts.
The execution, delivery and performance by Issuer of this Agreement and the
consummation of the transactions contemplated hereby, do not and will not (i) violate
(x) any provision of any Law or any governmental rule or regulation
applicable to Issuer or any Subsidiary thereof, (y) any of the
organizational documents of Issuer, or (z) any order, judgment or decree
of any court or other Governmental Authority binding on Issuer, except in the
case of clauses (x) and (z) to the extent such violation could not
reasonably be expected to have, individually or in the aggregate, an Issuer
Material Adverse Effect; (ii) conflict with, result in a breach of or constitute
(with due notice or lapse of time or both) a default under any Contractual
Obligation of Issuer, except to the extent such conflict, breach or default
could not reasonably be expected to have, individually or in the aggregate, an
Issuer Material Adverse Effect; (iii) result in or require the creation or
imposition of any material Lien upon any of the material properties of Issuer
(other than any Permitted Liens); or (iv) require any approval of
equityholders, members or partners or any approval or consent of any Person
under any Contractual Obligation of Issuer except for such approvals or
consents (x) that will be obtained

 

10

 

on or before the Closing or (y) the
failure of which to obtain could not reasonably be expected to have,
individually or in the aggregate, an Issuer Material Adverse Effect.

 

(d) Adverse
Proceedings. There is no Adverse Proceeding by or before any Governmental
Authority that is pending or, to the knowledge of Issuer, threatened against or
involving Issuer, any Subsidiary thereof or any of its assets, properties or
rights that could reasonably be expected to have, individually or in the
aggregate, an Issuer Material Adverse Effect. There is no Adverse Proceeding,
by or before any Governmental Authority, that is pending or, to the knowledge
of Issuer, threatened against Issuer or any Subsidiary that seeks to enjoin, or
otherwise prevent the consummation of, any of the transactions contemplated
herein or to recover any damages or obtain any relief as a result of any of the
transactions contemplated herein. None of Issuer or any Subsidiary thereof is,
nor will be after giving effect to the consummation of the transactions
contemplated by this Agreement, (i) in violation of any applicable Laws
that  could reasonably be expected
to have, individually or in the aggregate, an Issuer Material Adverse Effect,
or (ii) subject to or in default with respect to any final judgments,
writs, injunctions, decrees, rules or regulations of any court or Governmental
Authority, that could reasonably be expected to have, individually or in the
aggregate, an Issuer Material Adverse Effect.

 

(e) Consents, Etc.
No consent, approval or authorization of or declaration, registration or filing
with any Governmental Authority or any nongovernmental Person, is required in
connection with the execution or delivery by Issuer or any Subsidiary thereof
of this Agreement, or the performance by Issuer or any Subsidiary thereof of
its obligations hereunder, or as a condition to the legality, validity or
enforceability of this Agreement, except for such consents, approvals,
authorizations, declarations, registrations or filings (i) as are listed
in Section 6(e)(i) of the Disclosure Letter, all of which have
been or will on or prior to the Closing Date be obtained and are or will then
be in full force and effect or (ii) the failure of which to obtain could
not reasonably be expected to have an Issuer Material Adverse Effect.

 

(f) Broker’s or
Finder’s Commissions; Financial Advisory Fees. There are no broker’s or
finder’s fee or commission or financial advisory fees payable by Issuer or any
Subsidiary thereof with respect to the issuance and sale of the Newly Issued
Common Stock, the acquisition by iStar of the Secondary Common Stock or
consummation of the transactions contemplated by the Other Equity Purchase
Agreements or the DPA or making of the Senior Loan Repayment.

 

(g) Possession of
Franchises, Licenses, Etc. Issuer and its Subsidiaries possess all
franchises, certificates, licenses, permits, registrations, security clearances
and other authorizations from Governmental Authorities, free from burdensome
restrictions, that are necessary for the ownership, maintenance and operation
of their properties and assets, except the failure of which to possess could
not reasonably be expected to have an Issuer Material Adverse Effect.

 

(h) Use of Proceeds.
The proceeds from the sale of Common Stock pursuant to this Agreement and the
Other Equity Purchase Agreements will be used by Issuer solely to effect the
Senior Loan Repayment.

 

11

 

(i) Historical
Financial Statements; Liabilities. The Historical Financial Statements were
prepared in conformity with GAAP and fairly present, in all material respects,
the financial position, on a consolidated basis, of LNR Parent and its
consolidated subsidiaries as at the respective dates thereof and the results of
operations and cash flows, on a consolidated basis, of LNR Parent and its
consolidated subsidiaries for each of the periods then ended, subject, in the
case of any such unaudited consolidated financial statements, to (i) the
absence of consolidation of Consolidated SPV Subsidiaries, other than Madison
Square Company LLC, that were required to be consolidated effective December 1,
2009 (for the avoidance of doubt, amounts attributable to the interests held by
LNR Parent and its consolidated subsidiaries in these Consolidated SPV
Subsidiaries were not excluded), (ii) the absence of footnotes, and (iii) changes
resulting from audit and normal year-end adjustments. All liabilities of Issuer
or any of its Subsidiaries have been reflected in the most recent Historical
Financial Statements or the notes thereto to the extent required by GAAP or
otherwise disclosed in a schedule hereto or the Disclosure Letter, or otherwise
could not reasonably be expected to have, individually or in the aggregate, an
Issuer Material Adverse Effect.

 

(j) Related Party
Transactions. Except as otherwise contemplated in this Agreement, as of the
Closing, no holder of equity interests, employee, officer or director of Issuer
is directly or indirectly interested in any material contract or transaction
with Issuer or any of its Subsidiaries except with respect to any customer or
suppliers in the ordinary course of business consistent with past practice.

 

(k) Status under
Certain Laws. None of the Issuer or any Subsidiary thereof is an “investment
company” or a “person directly or indirectly controlled by or acting on behalf
of an investment company” within the meaning of the Investment Company Act of
1940, as amended, or a “holding company”, or a “subsidiary company” of a “holding
company”, or an “affiliate” of a “holding company” or of a “subsidiary company”
of a “holding company”, within the meaning of the Public Utility Holding
Company Act of 1935, as amended. None of the Issuer or any Subsidiary thereof
is subject to regulation as a “common carrier” or “contract carrier” or any
similar classification by the Interstate Commerce Commission or under the laws
of any state, or is subject to regulation under any other federal, state or  local Law which limits its ability to
incur indebtedness.

 

(l) No Other
Representations or Warranties. Except for the representations and
warranties of iStar expressly set forth in this Agreement. Issuer hereby
acknowledges that neither iStar nor any of its affiliates, directors, officers,
employees, affiliates, advisors, agents or representatives, nor any other
Person, has made or is making any other express or implied representation or
warranty with respect to the transactions contemplated hereby.

 

7. Representations and Warranties of Holdco. Except
as set forth in the corresponding section or subsections of the Disclosure
Letter (provided that a matter disclosed with respect to one representation or
warranty will also be deemed to be disclosed with respect to each other
representation or warranty to which the matter disclosed reasonably relates, to
the extent such relationship is reasonably apparent on the face of the
disclosure contained in the Disclosure Letter with respect to such matter),
Holdco hereby represents and warrants to iStar as of the date hereof and as of
the Closing Date (except with respect to a representation or warranty

 

12

 

set forth below that
addresses matters as of a particular date, which representations and warranties
shall be made only as of such date) as follows:

 

(a) Organization;
Authorization; Enforcement; Validity. Holdco is duly organized, validly
existing and in good standing under the Laws of its jurisdiction of
organization and is duly qualified to do business in each additional
jurisdiction where the failure to so qualify could not reasonably be expected
to have, individually or in the aggregate, a material adverse effect on (i) the
authority or ability of Holdco to perform its obligations hereunder or (ii) the
business, properties, assets, liabilities or financial condition of Holdco and
its Subsidiaries, taken as a whole (a “Holdco Material Adverse Effect”).
Holdco has all requisite organizational powers to own its properties and to
carry on its business as now being conducted and as proposed to be conducted,
other than such powers the absence of which has not had and could not reasonably
be expected to have a Holdco Material Adverse Effect. The execution, delivery
and performance of this Agreement by Holdco and the consummation by Holdco of
the transactions contemplated hereby have been duly authorized by Holdco. This
Agreement has been duly executed and delivered by Holdco and is the legally
valid and binding obligation of Holdco, enforceable against Holdco in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar Laws relating to
or limiting creditors’ rights generally or by equitable principles affecting
enforceability.

 

(b) No Conflicts.
The execution, delivery and performance by Holdco of this Agreement and the
consummation of the transactions contemplated hereby, do not and will not (i) violate
(x) any provision of any Law or any governmental rule or regulation
applicable to Holdco or any Subsidiary thereof, (y) any of the
organizational documents of Holdco, or (z) any order, judgment or decree
of any court or other Governmental Authority binding on Holdco, except in the
case of clauses (x) and (z) to the extent such violation could not
reasonably be expected to have, individually or in the aggregate, a Holdco
Material Adverse Effect; (ii) conflict with, result in a breach of or
constitute (with due notice or lapse of time or both) a default under any
Contractual Obligation of Holdco, except to the extent such conflict, breach or
default could not reasonably be expected to have, individually or in the aggregate,
a Holdco Material Adverse Effect; (iii) result in or require the creation
or imposition of any material Lien upon any of the material properties of
Holdco (other than any Permitted Liens) or (iv) require any approval of
equityholders, members or partners or any approval or consent of any Person
under any Contractual Obligation of Holdco except for such approvals or
consents (x) that will be obtained on or before the Closing or (y) the
failure of which to obtain could not reasonably be expected to have,
individually or in the aggregate, a Holdco Material Adverse Effect.

 

(c) Adverse
Proceedings. There is no Adverse Proceeding by or before any Governmental
Authority that is pending or, to the knowledge of Holdco, threatened against or
involving Holdco, any Subsidiary thereof or any of its assets, Properties or
rights that could reasonably be expected to have, individually or in the
aggregate, a Holdco Material Adverse Effect. There is no Adverse Proceeding, by
or before any Governmental Authority, that is pending or, to the knowledge of
Holdco, threatened against Holdco or any Subsidiary that seeks to enjoin, or
otherwise prevent the consummation of, any of the transactions contemplated
herein or to recover any damages or obtain any relief as a result of any of the
transactions contemplated herein. None of Holdco or any Subsidiary thereof is,
nor will be after giving effect to the consummation of the transactions
contemplated by this Agreement, (i) in violation of any

 

13

 

applicable Laws that could
reasonably be expected to have, individually or in the aggregate, a Holdco
Material Adverse Effect, or (ii) subject to or in default with respect to
any final judgments, writs, injunctions, decrees, rules or regulations of
any court or Governmental Authority, that could reasonably be expected to have,
individually or in the aggregate, a Holdco Material Adverse Effect.

 

(d) Consents, Etc.
No consent, approval or authorization of or declaration, registration or filing
with any Governmental Authority or any nongovernmental Person, is required in
connection with the execution or delivery by Holdco or any Subsidiary thereof
of this Agreement, or the performance by Holdco or any Subsidiary thereof of
its obligations hereunder, or as a condition to the legality, validity or
enforceability of this Agreement, except for such consents, approvals,
authorizations, declarations, registrations or filings (i) as are listed
in Section 7(d)(i) of the Disclosure Letter, all of which have been
or will on or prior to the Closing Date be obtained and are or will then be in
full force and effect or (ii) the failure of which to obtain could not
reasonably be expected to have a Holdco Material Adverse Effect.

 

(e) Title to the
Secondary Common Stock; Outstanding Principal Amount of Holdco Notes.
Holdco has good, legal and marketable title to the Secondary Common Stock, free
and clear of all Liens. Prior to Closing, Holdco has not, directly or
indirectly, assigned, conveyed or transferred to any Person any rights
(including any claims, suits and causes of action) pertaining to the Secondary
Common Stock or otherwise granted to (with or without notice or lapse of time)
any Person any rights in respect of the Secondary Common Stock. As of immediately
prior to Closing, the outstanding aggregate principal amount of Holdco Notes
was $400,000,000 (plus any interest thereon that has been capitalized).

 

(f) No Other
Representations or Warranties. Except for the representations and
warranties of iStar expressly set forth in this Agreement, Holdco hereby
acknowledges that neither iStar nor any of its affiliates, directors, officers,
employees, affiliates, advisors, agents or representatives, nor any other
Person, has made or is making any other express or implied representation or
warranty with respect to the transactions contemplated hereby.

 

8. Covenants.

 

(a) Commercially
Reasonable Efforts. Subject to the terms and conditions set forth in this
Agreement, each party will use commercially reasonable efforts to take, or
cause to be taken, all action, and to do, or cause to be done, all things
necessary, proper, or advisable, consistent with applicable Law, to consummate
the transactions contemplated hereby, including without limitation, making all
required regulatory and other filings required by applicable Law as promptly as
practicable after the date hereof.

 

(b) Announcement.
The parties agree that no public announcement shall be made by or on behalf of
the any of the parties hereto with respect to the transactions contemplated
hereby, other than (i) as required by applicable Law or (ii) as
otherwise mutually agreed; provided, that nothing herein shall restrict
Issuer or any of its affiliates from issuing a public announcement concerning
the Proposed Transaction to the extent iStar is not named in such public
announcement.

 

14

 

(c) Indemnification.
From and after the Closing, Issuer hereby agrees to indemnify and hold
harmless iStar and each iStar Affiliate (each an “Indemnified Party”)
from and against any and all losses, claims, damages, liabilities (or actions
or other proceedings commenced or threatened in respect thereof) or other
expenses (“Indemnified Losses”) to which such Indemnified Party may
become subject directly as a result of a third party claim against such
Indemnified Party based on the execution, delivery or performance by the
Indemnified Party or any of its Affiliates of this Agreement, and Issuer agrees
to reimburse each Indemnified Party for any reasonable legal or other
out-of-pocket expenses incurred in connection with investigating, defending or
participating in any such third-party claim (whether or not such Indemnified
Party is a party to any action or proceeding in respect of any such third-party
claim), but excluding therefrom all Indemnified Losses that result from the
gross negligence or willful misconduct of the Indemnified Party or any breach
of this Agreement by iStar.

 

(d) Expenses.
All costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby shall be paid by Issuer; provided, that
in the event of litigation relating to this Agreement, if a court of competent
jurisdiction determines in a final, non-appealable order that any party hereto
has breached this Agreement, then, in addition to any other remedy to which the
other parties hereto may be entitled, the party-in-breach shall be liable for
the reasonable legal fees and expenses incurred in connection with the
enforcement of any party’s rights hereunder arising from such breach.

 

(e) Further
Assurances. From and after the Closing, upon the request of any party
hereto, the applicable party shall execute and deliver such instruments,
documents and other writings as may be reasonably necessary or desirable to
confirm and carry out and to effectuate fully the intent and purposes of this
Agreement and to give effect to the termination of the effectiveness of the
Note Documents.

 

(f) Post-Closing
Rights Offering. As soon as practicable after the Closing, iStar, in
conjunction with the other Lead Investors, will conduct a rights offering to
the direct and indirect Class A/A1 shareholders of LNR Parent (other than
any affiliated funds and/or managed accounts of Cerberus Capital Management,
L.P.) (the “Non-Cerberus Class A Shareholders”) to allow each such
Non-Cerberus Class A Shareholder to acquire for cash (subject to execution
of an equity purchase agreement with Issuer) such Non-Cerberus Class A
Shareholder’s pro rata portion of 8.3% of the outstanding common equity of
Issuer (the “Rights Offering”) (which percentage represents the quotient
where the numerator is the product of (i) the $100 million aggregate cash
purchase price paid by Cerberus pursuant to the Other Equity Purchase Agreement
entered into by Cerberus in respect of the Common Stock and the DPA in respect
of the Additional Holdco Notes and (ii) the aggregate percentage (41.54%)
of Class A Shares owned directly or indirectly by the direct and indirect Class A/A1
shareholders of LNR Parent, and the denominator is the implied equity value for
Issuer of $500.5 million (pro forma for the consummation of the Proposed
Transactions)). Any common equity subscribed pursuant to such Rights Offering
shall be acquired from each of the Lead Investors (i) at the same price
per share as paid by iStar pursuant to this Agreement and the other Lead
Investors pursuant to the Other Equity Purchase Agreements in connection with
the purchase of common equity for cash (or, if the Company shall have converted
to an LLC, at a price per unit equal to such price per share divided by the
number of units issued per share in that conversion), (ii) on a pro rata
basis (based on the amount of common equity of Issuer acquired pursuant to the
transactions contemplated by

 

15

 

this Agreement and the Other
Equity Purchase Agreements) and (iii) pursuant to an equity purchase
agreement (an “Offeree EPA”) pursuant to which (x) Issuer shall
make, for the benefit of the purchaser and each Lead Investor, representations
and warranties that are substantially similar to those made by Issuer under
this Agreement and the Other Equity Purchase Agreements, (y) the only
representations and warranties to be made by a Lead Investor in the Offeree EPA
shall be customary representations and warranties as to due authorization,
enforceability, no conflicts, and title to common equity of Issuer being sold
by such Lead Investor pursuant to such Offeree EPA being the same title that it
received from Issuer and being free and clear of Liens attributable to such
Lead Investor and (z) Issuer shall indemnify and hold each Lead Investor
harmless from and against any  actions,
causes of action, suits, claims, counterclaims, demands, damages, costs, fees, expenses,
losses or liabilities of every kind and any nature whatsoever arising from the
Rights Offering, the purchase of common equity of Issuer pursuant to any of the
Offeree EPAs or any breach of any of the representations, warranties or
covenants of Issuer in any of the Offeree EPAs.

 

(g) As soon as
practicable after the Closing, Holdco shall provide to the Issuer a copy of the
then-current draft of Holdco’s and its Subsidiaries’ United States Federal
income tax return for the taxable year ended November 30, 2009 (including
all exhibits, schedules and attachments thereto), and no later than 60 days
prior to the due date for filing the United States Federal income tax return of
Holdco for the taxable year that includes the date of the Closing (the “Closing
Return”). Holdco shall provide to the Issuer a copy of such tax return
(including all exhibits, schedules and attachments thereto). The Issuer shall
provide written notice to Holdco no later than 30 days (and with respect to the
tax return for the taxable year ended November 30, 2009, within 7 days)
after having been sent a copy of such tax return (the “Review Period”)
of (1) its approval thereof, or (2) if the Issuer objects to such tax
return, the items of dispute and a reasonably detailed explanation of such
dispute. During the Review Period, Holdco shall provide the Issuer with
reasonable access to Holdco’s books, records (including any legal opinions and
accounting work papers), personnel, advisors, and tax return preparers with
respect to all matters related to the tax returns. To the extent there is a
dispute with respect to such tax returns, the parties will in good faith
attempt to resolve such dispute; provided, that if such dispute cannot
be settled within 15 days (and with respect to the tax return for the taxable
year ended November 30, 2009, within 5 days) after receipt of the Issuer’s
notice of dispute, the disputed items shall be submitted, in the case of the
Closing Return, to the National Tax Office of Ernst & Young LLP (but,
if Ernst & Young LLP shall then be performing substantial services for
either Holdings or its affiliates or the Issuer or its affiliates, to another
mutually agreeable, nationally recognized accounting firm), and, in the case of
the tax return for the taxable year ended November 30, 2009, to Deloitte
Tax LLP, for settlement, which firm shall decide solely which position is more
correct with respect to the disputed items (with any matters that may
electively be treated either in accordance with Holdco’s position or in accordance
with the Issuer’s position being treated in accordance with the Issuer’s
position, regardless of whether or not such position requires the filing of a
formal election with the tax return), and the decision of such firm shall be
binding on the parties. The costs of such accounting firm shall be shared
equally between Holdco and the Issuer. The foregoing procedures shall apply as
well to all state, local, and foreign tax returns for taxable years 2009 and
2010 that are filed by Holdco and its Subsidiaries, but include, for any
period, the Issuer or any of its subsidiaries, and, except as specifically
required by law, such returns shall be filed consistently with such Federal
income tax returns and shall be amended consistently with any amendment thereto.

 

16

 

 

9. Conditions to the Obligations of iStar to effect the
Closing. The obligations of iStar to consummate the Closing are
subject to the satisfaction, on or prior to the Closing Date, of each of the
following conditions, provided, that such conditions are for the sole
benefit of iStar and may be waived by iStar at any time in its sole discretion
by providing Issuer and Holdco with written notice thereof:

 

(a) the representations
and warranties of each of Holdco and Issuer shall be true and correct in all
material respects (except for those representations and warranties that are
qualified by materiality or material adverse effect, which shall be true and
correct in all respects) as of the date when made and as of the Closing Date as
though made at that time;

 

(b) each of Holdco and
Issuer shall have performed, satisfied and complied in all material respects
with the covenants, agreements and conditions required by this Agreement to be
performed, satisfied or complied with by Issuer or Holdco, as applicable, at or
prior to the Closing Date;

 

(c) no statute, rule,
regulation, executive order, decree, ruling or injunction shall have been
enacted, entered, promulgated or endorsed by any Governmental Authority having
authority over the matters contemplated hereby which prohibits, restrains or
enjoins the consummation of any of the transactions contemplated by this
Agreement;

 

(d) prior to Closing, (i) the
organizational documents of Issuer shall have been amended as necessary to
effect the issuance of Common Stock pursuant to this Agreement and the Other
Equity Purchase Agreements, (ii) LNR Parent and Holdco shall have
effected, or shall have caused its applicable Subsidiaries to effect, all asset
transfers, contributions or other actions to be completed prior to the Closing
as provided on Exhibit 1 of the Flow of Funds Agreement and (iii) LNR
shall have entered into an amendment to the Senior Credit Facility, in the form
attached hereto as Exhibit E, which amendment shall have been
approved by the Requisite Lenders (as defined in the Senior Credit Facility);

 

(e) the acquisition of
the Additional Holdco Notes from the Seller Noteholders and the acquisition of
Common Stock by each of the other Lead Investors pursuant to the applicable
Other Equity Purchase Agreements, in each case, shall be consummated
concurrently with the consummation of the transactions contemplated by this
Agreement;

 

(f) all necessary
consents, waivers, approvals and authorizations of, and declarations,
registrations and filings with, Governmental Authorities and nongovernmental
Persons required to be obtained or made by Issuer or Holdco to execute, deliver
and perform their respective obligations under this Agreement or the Other
Equity Purchase Agreements shall have been obtained or made, as applicable,
and, to the extent applicable, shall be in full force and effect, other than
those the absence of which would not reasonably be expected to have,
individually or in the aggregate, an Issuer Material Adverse Effect or a Holdco
Material Adverse Effect, as applicable; and

 

(g) Holdco has provided
iStar with a duly executed certificate of non-foreign status in a form and
manner that complies with section 1445 of the Code and the U.S. Treasury
Regulations promulgated thereunder.

 

17

 

Notwithstanding anything to
the contrary herein, iStar shall not have the right to rely on the failure of
any condition set forth in this Section 9 to be satisfied if such
failure was primarily caused by iStar’s failure to comply with the applicable
terms of this Agreement.

 

10. Conditions to the Obligations of Holdco and Issuer to
effect the Closing. The obligations of each of Issuer and Holdco
to consummate the Closing are subject to the satisfaction, on or prior to the
Closing Date, of each of the following conditions, provided, that such
conditions are for Issuer’s and Holdco’s sole benefit and may be waived by each
of Issuer and Holdco, respectively, in respect of itself at any time in its
sole discretion by providing iStar with written notice thereof:

 

(a) the representations
and warranties of iStar shall be true and correct in all material respects
(except for those representations and warranties that are qualified by
materiality or material adverse effect, which shall be true and correct in all
respects) as of the date when made and as of the Closing Date as though made at
that time;

 

(b) iStar shall have
performed, satisfied and complied in all material respects with the covenants,
agreements and conditions required by this Agreement to be performed, satisfied
or complied with by iStar at or prior to the Closing Date; and

 

(c) no statute, rule,
regulation, executive order, decree, ruling or injunction shall have been
enacted, entered, promulgated or endorsed by Governmental Authority having
authority over the matters contemplated hereby which prohibits, restrains or
enjoins the consummation of any of the transactions contemplated by this
Agreement.

 

Notwithstanding anything to
the contrary herein, neither Issuer nor Holdco shall have the right to rely on
the failure of any condition set forth in this Section 10 to be
satisfied if such failure was primarily caused by Issuer’s or Holdco’s, as
applicable, failure to comply with the applicable terms of this Agreement.

 

11. Termination.

 

(a)                     This Agreement may be
terminated at any time prior to the Closing:

 

(i)                        by mutual
written consent of the parties hereto;

 

(ii)                     by any party hereto (by
delivery of written notice to such effect to the other parties) if the Closing
shall not have occurred by the Forbearance Period Termination Date (as defined
in the Fifth Forbearance Agreement and Amendment, dated as of July 21,
2010, as amended from time to time, by and among LNR, LNR Parent, Deutsche Bank
AG, individually as a Lender, and as administrative agent for the Lenders, as
the other signatories thereto); or

 

(iii)                  at the sole option of iStar,
at any time prior to the Closing, if (A)(l) a court of competent
jurisdiction shall enter a decree or order for relief in respect of LNR Parent
or any of its subsidiaries in an involuntary case under the Bankruptcy Code or
under any other applicable bankruptcy, insolvency or

 

18

 

similar Law now or hereafter
in effect, which decree or order is not stayed; or any other similar relief
shall be granted under any applicable federal or state Law or (2) an
involuntary case shall be commenced against LNR Parent or any of its
subsidiaries under chapter 11 of the Bankruptcy Code or under any other
applicable bankruptcy, insolvency or similar Law now or hereafter in effect; or
a decree or order of a court having jurisdiction in the premises for the
appointment of a receiver, liquidator, sequestrator, trustee, custodian or
other officer having similar powers over LNR Parent or any of its subsidiaries
or over all or a substantial part of its property, shall have been entered; or
there shall have occurred the involuntary appointment of an interim receiver,
trustee or other custodian of LNR Parent or any of its subsidiaries for all or
a substantial part of its property; and, in the case of any such event
described in this subclause (2), such event shall continue for 25 days without
having been dismissed or discharged, or (B) LNR Parent or any of its
subsidiaries shall have an order for relief entered with respect to it or shall
commence a voluntary case under the Bankruptcy Code or under any other
applicable bankruptcy, insolvency or similar Law now or hereafter in effect, or
shall consent to the entry of an order for relief in an involuntary case, or to
the conversion of an involuntary case to a voluntary case, under any such Law,
or shall consent to the appointment of or taking possession by a receiver,
trustee or other custodian for all or a substantial part of its property; or
LNR Parent or any of its subsidiaries shall make any assignment for the benefit
of creditors; or the board of directors (or similar governing body) of LNR
Parent or any of its subsidiaries (or any committee thereof) shall adopt any
resolution or otherwise authorize any action to approve any of the actions
referred to in this clause (B) or in clause (A) above;

 

provided, that the right
to terminate this Agreement pursuant to this Section 11 shall not
be available if the failure of the Closing to have been consummated on or
before the Forbearance Period Termination Date, was primarily due to the
failure of the party seeking to terminate this Agreement to perform any of its
material obligations under this Agreement; provided, further,
that termination of this Agreement shall not relieve any party from liability
for any material and willful breach of this Agreement occurring prior to such
termination.

 

(b) If this Agreement
is terminated in accordance with this Section 11, this Agreement
shall become null and void and of no further force and effect, except that the
terms and provisions of this Section 11 and Sections 8(b), 8(c),
8(d), 12 and 13 shall remain in full force and effect.

 

12. No Recourse; Release.  Notwithstanding anything that may be
expressed or implied in this Agreement or any document or instrument delivered
contemporaneously herewith, by its acceptance of the benefits of this
Agreement, each of Holdco and Issuer covenants, acknowledges and agrees that,
except in the case of fraud, no Person other than iStar shall have any
obligation hereunder, and that, except in the case of fraud, neither Issuer nor
Holdco has any right of recovery against, and no liability shall attach to, be
imposed on, or otherwise be incurred by, iStar and or any former, current or
future director, officer, employee,

 

19

 

agent, controlling person,
general or limited partner, manager, member, stockholder, affiliate or assignee
of iStar or any former, current or future director, officer, employee, agent,
controlling person, general or limited partner, manager, member, stockholder,
affiliate or assignee of any of the foregoing (each, other than iStar, an “iStar
Affiliate”), whether by or through attempted piercing of the corporate (or
limited liability company) veil, by or through a claim by or on behalf of
Issuer or Holdco against iStar or an iStar Affiliate, by the enforcement of any
assessment or by any legal or equitable proceeding, in contract, in tort, or
otherwise, in connection with, relating to, or resulting from, this Agreement,
except to the extent of the Cash Purchase Price but solely with respect to the
obligations of iStar (or any affiliate to which iStar has assigned all or a
portion of its  rights and
obligations in accordance with the express terms of this Agreement) under, and
to the extent provided in, this Agreement and subject to the terms and
conditions hereof. Except in the case of fraud, recourse against iStar under or
pursuant lo the terms of this Agreement shall be the sole and exclusive remedy
of Issuer and Holdco and all of their respective affiliates against iStar or
any iStar Affiliate in respect of any liabilities or obligations arising under,
or in connection with, this Agreement. Notwithstanding anything to the contrary
in this Agreement, under no circumstances shall Issuer, Holdco or any other
Person be entitled to initiate or pursue, or threaten to initiate or pursue,
any form of action, claim or proceeding against iStar or any iStar Affiliate under
this Agreement, for, or obtain, any amount in respect of any incidental,
consequential, punitive, exemplary or special damages or lost profits. Except
in the case of fraud, each of Holdco and Issuer hereby covenants and agrees
that it shall not institute, directly or indirectly, and shall cause its
affiliates not to institute, any proceeding, or bring any other claim arising
under, in connection with, relating to, or resulting from, this Agreement,
against iStar or any iStar Affiliate except for claims solely against iStar (or
any affiliate to which iStar has assigned all or a portion of its rights and
obligations in accordance with the express terms of this Agreement) under, and
to the extent provided in, this Agreement and subject to the terms and conditions
hereof. By acceptance of this Agreement, except in the case of fraud, each of
Holdco and Issuer hereby releases iStar and each iStar Affiliate from and with
respect to any claim, known or unknown, now existing or hereafter arising,
under this Agreement, other than any claims against iStar (or any affiliate to
which iStar has assigned all or a portion of its rights and obligations in
accordance with the express terms of this Agreement) under, and to the extent
provided in, this Agreement and subject to the terms and conditions hereof.

 

13. Miscellaneous.

 

(a) Governing Law;
Jurisdiction; Waiver of Jury Trial. All questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall
be governed by the internal Laws of the State of New York, without giving
effect to any choice of law or conflict of law provision or rule (whether
of the State of New York or any other jurisdictions) that would cause the
application of the Laws of any jurisdictions other than the State of New York.
By its execution and delivery of this Agreement, each party irrevocably and
unconditionally agrees that any legal action, suit or proceeding with respect
to any matter arising out of or in connection with this Agreement may be
brought in the United States District Court for the Southern District of New
York or the courts of the State of New York which are located in the County of
New York, and, subject to the following sentence, by execution and delivery of
this Agreement, each of the parties irrevocably accepts and submits itself to
the exclusive jurisdiction of such courts, generally and unconditionally, with
respect to any such action, suit or

 

20

 

proceeding. EACH PARTY
HERETO IRREVOCABLY WAIVES ANY AND ALL RIGHT IT MAY HAVE TO, AND AGREES NOT
TO REQUEST, TRIAL BY JURY IN ANY ADVERSE PROCEEDING ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

(b) Release of
Certain Claims. iStar irrevocably agrees that, effective as of the Closing,
none of LNR Parent, Holdco, Issuer or any of their respective affiliates,
representatives, directors, officers, employees or agents, shall be liable to
iStar or any of its affiliates, representatives, directors, officers, employees
or agents for any losses, indemnities, claims, damages, demands, liabilities,
costs, expenses or other adverse consequences of any kind or any nature
whatsoever (including, without limitation, awards, judgments, fines, penalties,
charges, amounts paid or to be paid in settlement and reasonable attorney’s
fees and expenses) (collectively, “Released Claims”), which iStar now
has or hereafter may have, upon or by reason of any matter arising out of,
relating to, or concerning in any way whatsoever, the Note Purchase Agreement,
the iStar Holdco Notes, iStar’s Pro Rata Share of the Additional Holdco Notes
or the other Note Documents. For the avoidance of doubt, the prior sentence
shall not impair the rights of iStar or any iStar Affiliate in respect of the
Senior Credit Facility. iStar hereby acknowledges that before signing this
Agreement it has had adequate opportunity to engage and consult with and review
this Agreement with counsel, that this Agreement is entered into freely and
voluntarily, and that they have read this Agreement and understand all of its
terms, including the release of Released Claims set forth in this Section 13(b).

 

(c) Counterparts.
This Agreement may be executed in two or more identical counterparts, all of
which shall be considered one and the same agreement and the counterparts may
be delivered by facsimile transmission or by electronic mail in portable
document format (.pdf).

 

(d) Headings.
The headings of this Agreement are for convenience of reference and shall not
form part of, or affect the interpretation of, this Agreement.

 

(e) Severability.
The provisions of this Agreement shall be deemed severable and the invalidity
or unenforceability of any provision shall not affect the validity or
enforceability of the other provisions hereof. If any provision of this
Agreement, or the application thereof to any Person or any circumstance, is
invalid or unenforceable, (a) a suitable and equitable provision shall be
substituted therefor in order to carry out, so far as may be valid and
enforceable, the intent and purpose of such invalid or unenforceable provision
and (b) the remainder of this Agreement and the application of such
provision to other Persons or circumstances shall not be affected by such
invalidity or unenforceability. nor shall such invalidity or unenforceability
affect the validity or enforceability of such provision, or the application
thereof, in any other jurisdiction.

 

(f) Entire
Agreement; Amendments; Waivers. Other than Issuer’s Organizational
Documents, this Agreement shall supersede all other prior oral or written
agreements among Holdco, Issuer and iStar with respect to the matters
discussed herein, and this Agreement, and the instruments referenced herein
contain the entire understanding of the parties with respect to the matters
covered herein. No provision of this Agreement may be amended other than by an
instrument in writing signed by Issuer, Holdco and iStar. No provision hereof

 

21

 

may be waived other than by
an instrument in writing signed by the party against whom enforcement is
sought.

 

(g) Notices. Any
notices, consents, waivers or other communications required or permitted to be
given under the terms of this Agreement must be in writing and will be deemed
to have been delivered: (i) upon receipt, when delivered personally; (ii) upon
receipt, when sent by facsimile (provided confirmation of transmission is
mechanically or electronically generated and kept on file by the sending
party); or (iii) one business day after deposit with an overnight courier
service, in each case properly addressed to the party to receive the same. The
addresses and facsimile numbers for such communications shall be:

 

If to Holdco:

 

Riley Holdco Corp.

c/o LNR Property Corporation

1601 Washington Avenue, Suite 800

Miami Beach, Florida 33139

Attention: James A. Whitlow, General Counsel

Facsimile: (305) 695-5559

 

with a copy (for
informational purposes only) to:

 

Dewey & LeBoeuf LLP

1301 Avenue of the Americas 

New York, New York 10019 

Attention:  Lorenzo Borgogni 

                  Phillip
M. Abelson 

Facsimile: (212) 259-6333

 

If to Issuer:

 

LNR Property Corporation

1601 Washington Avenue, Suite 800

Miami Beach, Florida 33139

Attention: James A. Whitlow, General Counsel

Facsimile: (305) 695-5559

 

with a copy (for
informational purposes only) to:

 

Dewey & LeBoeuf
LLP  

1301 Avenue of the Americas
  New York, New York 10019 

Attention:  Lorenzo Borgogni 

                  Phillip
M. Abelson 

Facsimile: (212) 259-6333

 

If to iStar:

 

22

 

iStar Marlin LLC

c/o iStar Financial Inc.

1114 Avenue of the Americas, 39th Floor

New York, New York 10036

Attn: Chief Executive Officer

Telephone: (212) 930-9400

Facsimile: (212) 930-9494

 

with a copy (for
informational purposes only) to:

 

iStar Financial Inc.

1114 Avenue of the Americas, 39th Floor

New York, New York 10036

Attn: Nina B. Matis, Esq./Chief Legal Officer and Chief

Investment Officer

         Michelle MacKay,
Executive Vice President 

Telephone: (212) 930-9406 

Facsimile: (212) 930-9492

 

and to:

 

iStar Asset Services, Inc.

180 Glastonbury Boulevard, Suite 201

Glastonbury, Connecticut 06033

Attn: President

Telephone: (860) 815-5900

Facsimile: (860) 815-5901

 

and to:

 

Katten Muchin Rosenman LLP 

575 Madison Avenue 

New York, New York 10022 

Attention: Timothy G. Little, Esq. 

Reference: 208972-00384 

Telephone: (212) 940-8594 

Facsimile: (212) 894-5794

 

or to such other Persons or
addresses as may be designated in writing by the party to receive such notice
as provided above.

 

(h) Successors and
Assigns. Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by any of the parties hereto (whether
by operation of Law or otherwise) without the prior written consent of the other
parties. This Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and assigns. Any purported
assignment in violation of this Agreement is void.

 

23

 

(i) No Third Party
Beneficiaries. This Agreement is intended for the benefit of the parties
hereto and their respective permitted successors and assigns, and is not for
the benefit of, nor may any provision hereof be enforced by, any other Person,
except as provided in Sections 8(c), 8(f), 12  and 13(b).

 

(j) Survival.
The representations, warranties, covenants and obligations set forth in this
Agreement of the parties shall survive the Closing.

 

[Signature Page Follows]

 

24

 

IN WITNESS
WHEREOF, each of Holdco, Issuer and iStar have caused
their respective signature pages to this Agreement to be duly executed as
of the date first written above.

 

	
   

  	
  Holdco:  

  
	
   

  	
   

  
	
   

  	
  Riley
  Holdco Corp.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James A. Whitlow

  
	
   

  	
   

  	
  Name: James A. Whitlow

  
	
   

  	
   

  	
  Title: Vice President;
  Secretary

  

 

Equity Purchase Agreement

 

 

IN WITNESS
WHEREOF, each of Holdco, Issuer and iStar have caused
their respective signature pages to this Agreement to be duly executed as
of the date first written above.

 

	
   

  	
  Issuer:  

  
	
   

  	
   

  
	
   

  	
  LNR
  Property Corp.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James A. Whitlow

  
	
   

  	
   

  	
  Name: James A. Whitlow

  
	
   

  	
   

  	
  Title: Vice President;
  Secretary

  

 

Equity Purchase Agreement

 

 

IN WITNESS
WHEREOF, each of Holdco, Issuer and iStar have caused their respective
signature pages to this Agreement to be duly executed as of the date first
written above.

 

	
   

  	
  iStar:  

  
	
   

  	
   

  
	
   

  	
  iSTAR MARLIN LLC, 

  a Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michelle M. MacKay

  
	
   

  	
   

  	
  Name: Michelle M. MacKay

  
	
   

  	
   

  	
  Title: Executive Vice
  President

  

 

Equity Purchase AgreementExhibit 10.1

 

EXECUTION VERSION

 

 

 

AMENDED AND
RESTATED

 

CORNERSTONE
INVESTMENT AGREEMENT

 

effective
as of March 31, 2010

 

between

 

REP
INVESTMENTS LLC

 

and

 

GENERAL
GROWTH PROPERTIES, INC.

 

 

 

 

TABLE OF CONTENTS

 

	
   

  	
  Page

  
	
   

  	
   

  
	
  Article I

  	
  PURCHASE
  OF NEW COMMON STOCK; CLOSING

  	
  3

  
	
   

  	
   

  	
   

  
	
  Section 1.1

  	
  Purchase
  of New Common Stock

  	
  3

  
	
   

  	
   

  	
   

  
	
  Section 1.2

  	
  Closing

  	
  4

  
	
   

  	
   

  	
   

  
	
  Section 1.3

  	
  Company
  Rights Offering Election

  	
  4

  
	
   

  	
   

  	
   

  
	
  Article II

  	
  GGO
  SHARE DISTRIBUTION AND PURCHASE OF GGO COMMON STOCK

  	
  4

  
	
   

  	
   

  	
   

  
	
  Section 2.1

  	
  GGO
  Share Distribution

  	
  4

  
	
   

  	
   

  	
   

  
	
  Section 2.2

  	
  Purchase
  of GGO Common Stock

  	
  6

  
	
   

  	
   

  	
   

  
	
  Article III

  	
  REPRESENTATIONS
  AND WARRANTIES OF THE COMPANY

  	
  6

  
	
   

  	
   

  	
   

  
	
  Section 3.1

  	
  Organization
  and Qualification

  	
  6

  
	
   

  	
   

  	
   

  
	
  Section 3.2

  	
  Corporate
  Power and Authority

  	
  7

  
	
   

  	
   

  	
   

  
	
  Section 3.3

  	
  Execution
  and Delivery; Enforceability

  	
  7

  
	
   

  	
   

  	
   

  
	
  Section 3.4

  	
  Authorized
  Capital Stock

  	
  8

  
	
   

  	
   

  	
   

  
	
  Section 3.5

  	
  Issuance

  	
  9

  
	
   

  	
   

  	
   

  
	
  Section 3.6

  	
  No
  Conflict

  	
  10

  
	
   

  	
   

  	
   

  
	
  Section 3.7

  	
  Consents
  and Approvals

  	
  11

  
	
   

  	
   

  	
   

  
	
  Section 3.8

  	
  Company
  Reports

  	
  11

  
	
   

  	
   

  	
   

  
	
  Section 3.9

  	
  No
  Undisclosed Liabilities

  	
  13

  
	
   

  	
   

  	
   

  
	
  Section 3.10

  	
  No
  Material Adverse Effect

  	
  13

  
	
   

  	
   

  	
   

  
	
  Section 3.11

  	
  No
  Violation or Default: Licenses and Permits

  	
  13

  
	
   

  	
   

  	
   

  
	
  Section 3.12

  	
  Legal
  Proceedings

  	
  13

  
	
   

  	
   

  	
   

  
	
  Section 3.13

  	
  Investment
  Company Act

  	
  14

  
	
   

  	
   

  	
   

  
	
  Section 3.14

  	
  Compliance
  With Environmental Laws

  	
  14

  
	
   

  	
   

  	
   

  
	
  Section 3.15

  	
  Company
  Benefit Plans

  	
  14

  
	
   

  	
   

  	
   

  
	
  Section 3.16

  	
  Labor
  and Employment Matters

  	
  16

  
	
   

  	
   

  	
   

  
	
  Section 3.17

  	
  Insurance

  	
  16

  
	
   

  	
   

  	
   

  
	
  Section 3.18

  	
  No
  Unlawful Payments

  	
  16

  
	
   

  	
   

  	
   

  
	
  Section 3.19

  	
  No
  Broker’s Fees

  	
  16

  
	
   

  	
   

  	
   

  
	
  Section 3.20

  	
  Real
  and Personal Property

  	
  16

  
	
   

  	
   

  	
   

  
	
  Section 3.21

  	
  Tax
  Matters

  	
  21

  
				

 

i

 

TABLE OF CONTENTS

(continued)

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 3.22

  	
  Material
  Contracts

  	
  22

  
	
   

  	
   

  	
   

  
	
  Section 3.23

  	
  Certain
  Restrictions on Charter and Bylaws Provisions; State Takeover Laws

  	
  23

  
	
   

  	
   

  	
   

  
	
  Section 3.24

  	
  No
  Other Representations or Warranties

  	
  23

  
	
   

  	
   

  	
   

  
	
  Article IV

  	
  REPRESENTATIONS
  AND WARRANTIES OF PURCHASER

  	
  24

  
	
   

  	
   

  	
   

  
	
  Section 4.1

  	
  Organization

  	
  24

  
	
   

  	
   

  	
   

  
	
  Section 4.2

  	
  Power
  and Authority

  	
  24

  
	
   

  	
   

  	
   

  
	
  Section 4.3

  	
  Execution
  and Delivery

  	
  24

  
	
   

  	
   

  	
   

  
	
  Section 4.4

  	
  No
  Conflict

  	
  24

  
	
   

  	
   

  	
   

  
	
  Section 4.5

  	
  Consents
  and Approvals

  	
  24

  
	
   

  	
   

  	
   

  
	
  Section 4.6

  	
  Compliance
  with Laws

  	
  25

  
	
   

  	
   

  	
   

  
	
  Section 4.7

  	
  Legal
  Proceedings

  	
  25

  
	
   

  	
   

  	
   

  
	
  Section 4.8

  	
  No
  Broker’s Fees

  	
  25

  
	
   

  	
   

  	
   

  
	
  Section 4.9

  	
  Sophistication

  	
  25

  
	
   

  	
   

  	
   

  
	
  Section 4.10

  	
  Purchaser
  Intent

  	
  25

  
	
   

  	
   

  	
   

  
	
  Section 4.11

  	
  Reliance
  on Exemptions

  	
  25

  
	
   

  	
   

  	
   

  
	
  Section 4.12

  	
  REIT
  Representations

  	
  25

  
	
   

  	
   

  	
   

  
	
  Section 4.13

  	
  No
  Other Representations or Warranties

  	
  26

  
	
   

  	
   

  	
   

  
	
  Section 4.14

  	
  Acknowledgement

  	
  26

  
	
   

  	
   

  	
   

  
	
  Article V

  	
  COVENANTS
  OF THE COMPANY AND PURCHASER

  	
  26

  
	
   

  	
   

  	
   

  
	
  Section 5.1

  	
  Bankruptcy
  Court Motions and Orders

  	
  26

  
	
   

  	
   

  	
   

  
	
  Section 5.2

  	
  Warrants,
  New Warrants and GGO Warrants

  	
  27

  
	
   

  	
   

  	
   

  
	
  Section 5.3

  	
  Assistance
  with Capital Raising Activities

  	
  27

  
	
   

  	
   

  	
   

  
	
  Section 5.4

  	
  Listing

  	
  28

  
	
   

  	
   

  	
   

  
	
  Section 5.5

  	
  Use
  of Proceeds

  	
  28

  
	
   

  	
   

  	
   

  
	
  Section 5.6

  	
  Access
  to Information

  	
  28

  
	
   

  	
   

  	
   

  
	
  Section 5.7

  	
  Competing
  Transactions

  	
  29

  
	
   

  	
   

  	
   

  
	
  Section 5.8

  	
  Reservation
  for Issuance

  	
  29

  
	
   

  	
   

  	
   

  
	
  Section 5.9

  	
  Subscription
  Rights

  	
  29

  
	
   

  	
   

  	
   

  
	
  Section 5.10

  	
  Company
  Board of Directors

  	
  33

  
				

 

ii

 

TABLE OF CONTENTS

(continued)

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 5.11

  	
  Notification
  of Certain Matters

  	
  36

  
	
   

  	
   

  	
   

  
	
  Section 5.12

  	
  Further
  Assurances

  	
  37

  
	
   

  	
   

  	
   

  
	
  Section 5.13

  	
  [Intentionally
  Omitted.]

  	
  37

  
	
   

  	
   

  	
   

  
	
  Section 5.14

  	
  Rights
  Agreement; Reorganized Company Organizational Documents

  	
  37

  
	
   

  	
   

  	
   

  
	
  Section 5.15

  	
  Stockholder
  Approval

  	
  39

  
	
   

  	
   

  	
   

  
	
  Section 5.16

  	
  Registration
  Statements

  	
  39

  
	
   

  	
   

  	
   

  
	
  Section 5.17

  	
  Closing
  Date Net Debt

  	
  39

  
	
   

  	
   

  	
   

  
	
  Article VI

  	
  ADDITIONAL
  COVENANTS OF PURCHASER

  	
  42

  
	
   

  	
   

  	
   

  
	
  Section 6.1

  	
  Information

  	
  42

  
	
   

  	
   

  	
   

  
	
  Section 6.2

  	
  Purchaser
  Efforts

  	
  42

  
	
   

  	
   

  	
   

  
	
  Section 6.3

  	
  Plan
  Support

  	
  42

  
	
   

  	
   

  	
   

  
	
  Section 6.4

  	
  Transfer
  Restrictions

  	
  43

  
	
   

  	
   

  	
   

  
	
  Section 6.5

  	
  Equity
  Commitments; Source of Funds

  	
  45

  
	
   

  	
   

  	
   

  
	
  Section 6.6

  	
  REIT
  Representations and Covenants

  	
  45

  
	
   

  	
   

  	
   

  
	
  Section 6.7

  	
  Non-Control
  Agreement

  	
  46

  
	
   

  	
   

  	
   

  
	
  Section 6.8

  	
  Purchaser
  Formed Entities

  	
  46

  
	
   

  	
   

  	
   

  
	
  Section 6.9

  	
  Additional
  Backstops

  	
  46

  
	
   

  	
   

  	
   

  
	
  Article VII

  	
  CONDITIONS
  TO THE OBLIGATIONS OF PURCHASER

  	
  49

  
	
   

  	
   

  	
   

  
	
  Section 7.1

  	
  Conditions
  to the Obligations of Purchaser

  	
  49

  
	
   

  	
   

  	
   

  
	
  Article VIII

  	
  CONDITIONS
  TO THE OBLIGATIONS OF THE COMPANY

  	
  58

  
	
   

  	
   

  	
   

  
	
  Section 8.1

  	
  Conditions
  to the Obligations of the Company

  	
  58

  
	
   

  	
   

  	
   

  
	
  Article IX

  	
  INDEMNIFICATION

  	
  60

  
	
   

  	
   

  	
   

  
	
  Section 9.1

  	
  Indemnification

  	
  60

  
	
   

  	
   

  	
   

  
	
  Article X

  	
  SURVIVAL
  OF REPRESENTATIONS AND WARRANTIES

  	
  61

  
	
   

  	
   

  	
   

  
	
  Section 10.1

  	
  Survival
  of Representations and Warranties

  	
  61

  
	
   

  	
   

  	
   

  
	
  Article XI

  	
  TERMINATION

  	
  61

  
	
   

  	
   

  	
   

  
	
  Section 11.1

  	
  Termination

  	
  61

  
	
   

  	
   

  	
   

  
	
  Section 11.2

  	
  Effects
  of Termination

  	
  64

  
				

 

iii

 

TABLE OF CONTENTS

(continued)

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Article XII

  	
  DEFINITIONS

  	
  65

  
	
   

  	
   

  	
   

  
	
  Section 12.1

  	
  Defined
  Terms

  	
  65

  
	
   

  	
   

  	
   

  
	
  Article XIII

  	
  MISCELLANEOUS

  	
  79

  
	
   

  	
   

  	
   

  
	
  Section 13.1

  	
  Notices

  	
  79

  
	
   

  	
   

  	
   

  
	
  Section 13.2

  	
  Assignment;
  Third Party Beneficiaries

  	
  80

  
	
   

  	
   

  	
   

  
	
  Section 13.3

  	
  Prior
  Negotiations; Entire Agreement

  	
  81

  
	
   

  	
   

  	
   

  
	
  Section 13.4

  	
  Governing
  Law; Venue

  	
  81

  
	
   

  	
   

  	
   

  
	
  Section 13.5

  	
  Company
  Disclosure Letter

  	
  82

  
	
   

  	
   

  	
   

  
	
  Section 13.6

  	
  Counterparts

  	
  82

  
	
   

  	
   

  	
   

  
	
  Section 13.7

  	
  Expenses

  	
  82

  
	
   

  	
   

  	
   

  
	
  Section 13.8

  	
  Waivers
  and Amendments

  	
  82

  
	
   

  	
   

  	
   

  
	
  Section 13.9

  	
  Construction

  	
  82

  
	
   

  	
   

  	
   

  
	
  Section 13.10

  	
  Adjustment
  of Share Numbers and Prices

  	
  83

  
	
   

  	
   

  	
   

  
	
  Section 13.11

  	
  Certain
  Remedies

  	
  83

  
	
   

  	
   

  	
   

  
	
  Section 13.12

  	
  Bankruptcy
  Matters

  	
  85

  
				

 

iv

 

LIST OF
EXHIBITS

 

	
  Exhibit A:

  	
  Plan
  Summary Term Sheet

  
	
   

  	
   

  
	
  Exhibit B:

  	
  Post-Bankruptcy
  GGP Corporate Structure

  
	
   

  	
   

  
	
  Exhibit C-1:

  	
  Fairholme
  Agreement

  
	
   

  	
   

  
	
  Exhibit C-2:

  	
  Pershing
  Agreement

  
	
   

  	
   

  
	
  Exhibit D:

  	
  REIT
  Representation Letter

  
	
   

  	
   

  
	
  Exhibit E:

  	
  GGO
  Assets

  
	
   

  	
   

  
	
  Exhibit F:

  	
  Form of
  Approval Order

  
	
   

  	
   

  
	
  Exhibit G:

  	
  Form of
  Warrant Agreement

  
	
   

  	
   

  
	
  Exhibit H:

  	
  [Intentionally
  Omitted]

  
	
   

  	
   

  
	
  Exhibit I:

  	
  [Intentionally
  Omitted]

  
	
   

  	
   

  
	
  Exhibit J:

  	
  Form of
  REIT Opinion

  
	
   

  	
   

  
	
  Exhibit K:

  	
  Form of
  Amended and Restated Brookfield Equity Commitment Letter

  
	
   

  	
   

  
	
  Exhibit L:

  	
  Form of
  Escrow Agreement

  
	
   

  	
   

  
	
  Exhibit M:

  	
  Form of
  Non-Control Agreement

  
	
   

  	
   

  
	
  Exhibit N:

  	
  Certain
  REIT Investors

  

 

v

 

INDEX OF
DEFINED TERMS

 

	
  Defined Term

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  2006 Bank Loan

  	
   

  	
  65

  
	
  Acceptable LC

  	
   

  	
  64

  
	
  Additional Financing

  	
   

  	
  53

  
	
  Additional Sales Period

  	
   

  	
  65

  
	
  Adequate Reserves

  	
   

  	
  21

  
	
  Affiliate

  	
   

  	
  65

  
	
  Agreement

  	
   

  	
  1

  
	
  Anticipated Debt Paydowns

  	
   

  	
  53

  
	
  Approval Motion

  	
   

  	
  26

  
	
  Approval Order

  	
   

  	
  26

  
	
  Asset Sales

  	
   

  	
  54

  
	
  Backstop Investors

  	
   

  	
  46

  
	
  Bankruptcy Cases

  	
   

  	
  1

  
	
  Bankruptcy Code

  	
   

  	
  1

  
	
  Bankruptcy Court

  	
   

  	
  1

  
	
  Blackstone

  	
   

  	
  80

  
	
  Blackstone Assigned Securities

  	
   

  	
  80

  
	
  Blackstone Assigned Shares

  	
   

  	
  80

  
	
  Blackstone Assigned Warrants

  	
   

  	
  80

  
	
  Blackstone Purchase Price

  	
   

  	
  80

  
	
  Brazilian Entities

  	
   

  	
  65

  
	
  Bridge Securities

  	
   

  	
  47

  
	
  Brookfield Consortium Member

  	
   

  	
  65

  
	
  Brookfield Equity Commitment
  Letter

  	
   

  	
  64

  
	
  Business Day

  	
   

  	
  65

  
	
  Capital Raising Activities

  	
   

  	
  27

  
	
  Cash Equivalents

  	
   

  	
  65

  
	
  Chapter 11

  	
   

  	
  1

  
	
  Claims

  	
   

  	
  66

  
	
  Closing

  	
   

  	
  4

  
	
  Closing Date

  	
   

  	
  4

  
	
  Closing Date Net Debt

  	
   

  	
  66

  
	
  Closing Date Net Debt W/O
  Reinstatement Adjustment and Permitted Claims Amounts

  	
   

  	
  66

  
	
  Closing Funding Certification

  	
   

  	
  83

  
	
  Closing Restraint

  	
   

  	
  63

  
	
  CMPC

  	
   

  	
  6

  
	
  CNDAS Dispute Notice

  	
   

  	
  40

  
	
  CNDAS Disputed Items

  	
   

  	
  40

  
	
  Code

  	
   

  	
  15

  
	
  Commitment Amount

  	
   

  	
  45

  
	
  Common Stock

  	
   

  	
  1

  
	
  Company

  	
   

  	
  1

  
	
  Company Benefit Plan

  	
   

  	
  67

  

 

vi

 

	
  Company Board

  	
   

  	
  67

  
	
  Company Disclosure Letter

  	
   

  	
  6

  
	
  Company Ground Lease Property

  	
   

  	
  18

  
	
  Company Mortgage Loan

  	
   

  	
  20

  
	
  Company Option Plans

  	
   

  	
  8

  
	
  Company Properties

  	
   

  	
  17

  
	
  Company Property

  	
   

  	
  17

  
	
  Company Property Lease

  	
   

  	
  19

  
	
  Company Rights Offering

  	
   

  	
  4

  
	
  Company SEC Reports

  	
   

  	
  11

  
	
  Competing Transaction

  	
   

  	
  67

  
	
  Conclusive Net Debt Adjustment
  Statement

  	
   

  	
  68

  
	
  Confidentiality Agreement

  	
   

  	
  28

  
	
  Confirmation Order

  	
   

  	
  50

  
	
  Confirmed Debtors

  	
   

  	
  75

  
	
  Contract

  	
   

  	
  68

  
	
  Corporate Level Debt

  	
   

  	
  68

  
	
  Dealer Manager

  	
   

  	
  46

  
	
  Debt

  	
   

  	
  68

  
	
  Debtors

  	
   

  	
  1

  
	
  Designation Conditions

  	
   

  	
  4

  
	
  DIP Loan

  	
   

  	
  68

  
	
  Disclosure Statement

  	
   

  	
  68

  
	
  Disclosure Statement Order

  	
   

  	
  50

  
	
  Dispute Notice

  	
   

  	
  40

  
	
  Disputed Items

  	
   

  	
  40

  
	
  Effective Date

  	
   

  	
  4

  
	
  Encumbrances

  	
   

  	
  17

  
	
  Environmental Laws

  	
   

  	
  14

  
	
  Equity Exchange

  	
   

  	
  1

  
	
  Equity Financing

  	
   

  	
  84

  
	
  Equity Provider

  	
   

  	
  64

  
	
  Equity Securities

  	
   

  	
  8

  
	
  ERISA

  	
   

  	
  68

  
	
  ERISA Affiliate

  	
   

  	
  15

  
	
  Escrow Agreement

  	
   

  	
  64

  
	
  Escrow Agreements

  	
   

  	
  64

  
	
  Excess Surplus Amount

  	
   

  	
  68

  
	
  Exchangeable Notes

  	
   

  	
  69

  
	
  Excluded Claims

  	
   

  	
  69

  
	
  Excluded Non-US Plans

  	
   

  	
  15

  
	
  Fairholme Agreement

  	
   

  	
  2

  
	
  Fairholme Investors

  	
   

  	
  2

  
	
  Fairholme/Pershing  Agreements

  	
   

  	
  2

  
	
  Fairholme/Pershing Investors

  	
   

  	
  2

  
	
  Foreign Plan

  	
   

  	
  15

  

 

vii

 

	
  Fully Diluted Basis

  	
   

  	
  70

  
	
  Funding Document

  	
   

  	
  78

  
	
  GAAP

  	
   

  	
  70

  
	
  GGO

  	
   

  	
  2

  
	
  GGO Agreement

  	
   

  	
  35

  
	
  GGO Board

  	
   

  	
  34

  
	
  GGO Common Share Amount

  	
   

  	
  70

  
	
  GGO Common Stock

  	
   

  	
  4

  
	
  GGO Note Amount

  	
   

  	
  71

  
	
  GGO Per Share Purchase Price

  	
   

  	
  6

  
	
  GGO Promissory Note

  	
   

  	
  71

  
	
  GGO Purchase Price

  	
   

  	
  6

  
	
  GGO Representative

  	
   

  	
  5

  
	
  GGO Setup Costs

  	
   

  	
  71

  
	
  GGO Share Distribution

  	
   

  	
  5

  
	
  GGO Shares

  	
   

  	
  6

  
	
  GGO Warrants

  	
   

  	
  27

  
	
  GGP

  	
   

  	
  1

  
	
  GGP Backstop Rights Offering

  	
   

  	
  46

  
	
  GGP Backstop Rights Offering
  Amount

  	
   

  	
  46

  
	
  Governmental Entity

  	
   

  	
  71

  
	
  Hazardous Materials

  	
   

  	
  14

  
	
  Hughes Agreement

  	
   

  	
  72

  
	
  Hughes Amount

  	
   

  	
  71

  
	
  Hughes Heirs Obligations

  	
   

  	
  72

  
	
  Identified Assets

  	
   

  	
  5

  
	
  Indebtedness

  	
   

  	
  72

  
	
  Indemnified Person

  	
   

  	
  60

  
	
  Indemnity Cap

  	
   

  	
  41

  
	
  Initial Investors

  	
   

  	
  48

  
	
  Joint Venture

  	
   

  	
  72

  
	
  Knowledge

  	
   

  	
  72

  
	
  Law

  	
   

  	
  72

  
	
  Liquidity Equity Issuances

  	
   

  	
  72

  
	
  Liquidity Target

  	
   

  	
  52

  
	
  Material Adverse Effect

  	
   

  	
  73

  
	
  Material Contract

  	
   

  	
  73

  
	
  Material Lease

  	
   

  	
  19

  
	
  Measurement Date

  	
   

  	
  8

  
	
  Most Recent Statement

  	
   

  	
  17

  
	
  MPC Assets

  	
   

  	
  74

  
	
  MPC Taxes

  	
   

  	
  74

  
	
  Net Debt Excess Amount

  	
   

  	
  74

  
	
  Net Debt Surplus Amount

  	
   

  	
  74

  
	
  New Common Stock

  	
   

  	
  1

  
	
  New Debt

  	
   

  	
  53

  

 

viii

 

	
  New DIP Agreement

  	
   

  	
  50

  
	
  New Warrants

  	
   

  	
  27

  
	
  Non-Control Agreement

  	
   

  	
  74

  
	
  Non-Controlling Properties

  	
   

  	
  74

  
	
  NYSE

  	
   

  	
  28

  
	
  Offering Premium

  	
   

  	
  74

  
	
  Operating Partnership

  	
   

  	
  75

  
	
  Original Agreement

  	
   

  	
  1

  
	
  Other Sponsor

  	
   

  	
  78

  
	
  PBGC

  	
   

  	
  15

  
	
  Per Share Purchase Price

  	
   

  	
  3

  
	
  Permitted Assign

  	
   

  	
  3

  
	
  Permitted Claims

  	
   

  	
  75

  
	
  Permitted Claims Amount

  	
   

  	
  75

  
	
  Permitted Title Exceptions

  	
   

  	
  17

  
	
  Pershing Agreement

  	
   

  	
  2

  
	
  Pershing Investors

  	
   

  	
  2

  
	
  Person

  	
   

  	
  75

  
	
  Petition Date

  	
   

  	
  1

  
	
  Plan

  	
   

  	
  1

  
	
  Plan Debtors

  	
   

  	
  75

  
	
  Plan Summary Term Sheet

  	
   

  	
  1

  
	
  PMA Claims

  	
   

  	
  75

  
	
  Preliminary Closing  Date
  Net Debt Review Deadline

  	
   

  	
  75

  
	
  Preliminary Closing  Date
  Net Debt Review Period

  	
   

  	
  76

  
	
  Preliminary Closing Date Net Debt
  Schedule

  	
   

  	
  39

  
	
  Proceedings

  	
   

  	
  60

  
	
  Proportionally Consolidated Debt

  	
   

  	
  76

  
	
  Proportionally Consolidated
  Unrestricted Cash

  	
   

  	
  76

  
	
  Proposed Approval Order

  	
   

  	
  26

  
	
  Proposed Securities

  	
   

  	
  29

  
	
  Purchase Price

  	
   

  	
  3

  
	
  Purchaser

  	
   

  	
  1

  
	
  Purchaser Board Designees

  	
   

  	
  33

  
	
  Purchaser GGO Board Designee

  	
   

  	
  34

  
	
  Refinance Cap

  	
   

  	
  56

  
	
  Reinstated Amounts

  	
   

  	
  53

  
	
  Reinstatement Adjustment Amount

  	
   

  	
  76

  
	
  Reinstatement Amount

  	
   

  	
  76

  
	
  REIT

  	
   

  	
  21

  
	
  REIT Subsidiary

  	
   

  	
  22

  
	
  Release Date

  	
   

  	
  45

  
	
  Reorganized Company

  	
   

  	
  1

  
	
  Reorganized Company
  Organizational Documents

  	
   

  	
  37

  
	
  Reserve

  	
   

  	
  75

  
	
  Reserve Surplus Amount

  	
   

  	
  76

  

 

ix

 

	
  Resolution Period

  	
   

  	
  40

  
	
  Rights Agreement

  	
   

  	
  77

  
	
  Rights Offering Election

  	
   

  	
  4

  
	
  Rouse Bonds

  	
   

  	
  77

  
	
  Rule 144

  	
   

  	
  43

  
	
  Sales Cap

  	
   

  	
  55

  
	
  SEC

  	
   

  	
  11

  
	
  Securities Act

  	
   

  	
  11

  
	
  Share Cap Number

  	
   

  	
  53

  
	
  Share Equivalent

  	
   

  	
  77

  
	
  Shares

  	
   

  	
  3

  
	
  Significant Subsidiaries

  	
   

  	
  77

  
	
  Subscribing Entities

  	
   

  	
  29

  
	
  Subscribing Entity

  	
   

  	
  29

  
	
  Subscription Right

  	
   

  	
  29

  
	
  Subsidiary

  	
   

  	
  77

  
	
  Synthetic Lease Obligation

  	
   

  	
  72

  
	
  Target Net Debt

  	
   

  	
  77

  
	
  Tax Protection Agreements

  	
   

  	
  77

  
	
  Tax Return

  	
   

  	
  21

  
	
  Taxes

  	
   

  	
  21

  
	
  Termination Date

  	
   

  	
  77

  
	
  Termination Date Extension Notice

  	
   

  	
  77

  
	
  Transactions

  	
   

  	
  78

  
	
  Transfer

  	
   

  	
  44

  
	
  TRUPS

  	
   

  	
  78

  
	
  Unrestricted Cash

  	
   

  	
  78

  
	
  Unsecured Indebtedness

  	
   

  	
  79

  
	
  UPREIT Units

  	
   

  	
  79

  
	
  Warrant Agreement

  	
   

  	
  27

  
	
  Warrants

  	
   

  	
  27

  

 

x

 

AMENDED AND RESTATED CORNERSTONE INVESTMENT AGREEMENT, effective as of March 31, 2010 (this “Agreement”),
by and between General Growth Properties, Inc., a Delaware corporation (“GGP”), and REP Investments
LLC, a Delaware limited liability company (together with its permitted assigns,
“Purchaser”).

 

On March 31, 2010, GGP and Purchaser entered
into the Cornerstone Investment Agreement (as subsequently amended on May 3,
2010 and May 7, 2010, the “Original  Agreement”) to provide
for the terms and conditions for the consummation of the transactions
contemplated herein.  Pursuant to Section 13.8
of the Original Agreement, the parties thereto wish to amend and restate the
Original Agreement ab initio in
its entirety as set forth herein. 
References herein to “date of this Agreement” and “date hereof” shall
refer to March 31, 2010.

 

RECITALS

 

WHEREAS,
GGP is a debtor in possession in that certain bankruptcy case under chapter 11
(“Chapter 11”) of Title 11 of the United States Code, 11 U.S.C.
§§ 101 -1532 (as amended, the “Bankruptcy Code”) filed on April 16,
2009 (the “Petition Date”) in the United States Bankruptcy Court for the
Southern District of New York (the “Bankruptcy Court”), Case No. 09-11977
(ALG).

 

WHEREAS, Purchaser
desires to assist GGP in its plans to recapitalize and emerge from bankruptcy
and has agreed to sponsor the implementation of a joint chapter 11 plan of
reorganization based on the Plan Summary Term Sheet (as defined below)
(together with all documents and agreements that form part of such plan or
related plan supplement or are related thereto, and as it may be amended,
modified or supplemented from time to time, in each case, to the extent it
relates to the implementation and effectuation of the Plan Summary Term Sheet
and this Agreement, the “Plan”), of GGP and its Subsidiaries and
Affiliates who are debtors and debtors-in-possession (the “Debtors”) in
the chapter 11 cases pending and jointly administered in the Bankruptcy Court
(the “Bankruptcy Cases”).

 

WHEREAS,
principal elements of the Plan (including a table setting forth the proposed
treatment of allowed claims and equity interests in the Bankruptcy Cases) are
set forth on Exhibit A hereto (the “Plan Summary Term Sheet”).

 

WHEREAS,
the Plan shall provide, among other things, that (i) each holder of common
stock, par value $0.01 per share, of GGP (the “Common Stock”) shall
receive, in exchange for each share of Common Stock held by such holder, one
share of new common stock (the “New Common Stock”) of a new company that
succeeds to GGP in the manner contemplated by Exhibit B upon
consummation of the Plan (the “Reorganized Company”) and (ii) any
Equity Securities (other than Common Stock) of the Company (as defined below)
or any of its Subsidiaries (as defined below) outstanding immediately after the
Effective Date that were previously convertible into, or exercisable or
exchangeable for, Common Stock shall thereafter be convertible into, or
exercisable or exchangeable for, New Common Stock (based upon the number of
shares of Common Stock underlying such Equity Securities) (the transactions
contemplated by clauses (i) and (ii) of this recital being referred
to herein as the “Equity Exchange”). 
For purposes of this Agreement, the “Company” shall be deemed to
refer, prior to 

 

 

consummation of the Plan, to GGP and, on and after
consummation of the Plan, the Reorganized Company, as the context requires.

 

WHEREAS, Purchaser
desires to make an investment in the Reorganized Company on the terms and
subject to the conditions described herein in the form of the purchase of
shares of New Common Stock as contemplated hereby.

 

WHEREAS,
in addition to the Equity Exchange and the sale of the Shares (as defined
below), the Plan shall provide for the incorporation by the Company of a new
subsidiary (“GGO”), the contribution of certain assets (and/or equity
interests related thereto) of the Company to GGO and the assumption by GGO of
the liabilities associated with such assets, the distribution to the
shareholders of the Company (prior to the issuance of the Shares and the
issuance of other shares of New Common Stock contemplated by this Agreement
other than pursuant to the Equity Exchange) on a pro rata basis and holders of
UPREIT Units of all of the capital stock of GGO, and whereas Purchaser desires
to make an investment in GGO on the terms and subject to the conditions
described herein in the form of the purchase of shares of GGO Common Stock as
contemplated hereby.

 

WHEREAS, the
Company has requested that Purchaser commit to purchase the Shares and the GGO
Shares at a fixed price for the term hereof.

 

WHEREAS, Purchaser has
agreed to enter into this Agreement and commit to purchase the Shares and the
GGO Shares only on the condition that the Company, as promptly as practicable
following the date hereof (but no later than the date provided in Section 5.2
hereof), issue the Warrants contemplated herein and perform its other
obligations hereunder.

 

WHEREAS, on and effective
as of the date hereof, the Company entered into an agreement (in the form
attached hereto as Exhibit C-1 together with any amendments thereto
as have been approved by Purchaser, the “Fairholme Agreement”) with The
Fairholme Fund and The Fairholme Focused Income Fund (the “Fairholme
Investors”) pursuant to which the Fairholme Investors have agreed to make (i) an
investment of up to $2,714,285,710 in the Reorganized Company in the form of
the purchase of shares of New Common Stock and (ii) an investment of
$62,500,000 in GGO in the form of the purchase of shares of GGO Common Stock.

 

WHEREAS, on
and effective as of the date hereof, the Company entered into an agreement (in
the form attached hereto as Exhibit C-2 together with any
amendments thereto as have been approved by Purchaser, the “Pershing
Agreement” and, together with the Fairholme Agreement, the “Fairholme/Pershing
Agreements”) with Pershing Square, L.P., Pershing Square II, L.P., Pershing
Square International, Ltd. and Pershing Square International V, Ltd.
(the “Pershing Investors” and, together with the Fairholme Investors,
the “Fairholme/Pershing Investors”) pursuant to which the Pershing
Investors have agreed to make (i) an investment of up to $1,085,714,290 in
the Reorganized Company in the form of the purchase of shares of New Common
Stock and (ii) an investment of $62,500,000 in GGO in the form of the
purchase of shares of GGO Common Stock.

 

2

 

NOW, THEREFORE,
in consideration of the premises, and of the representations, warranties,
covenants and agreements set forth herein, the parties agree as follows:

 

ARTICLE I

 

PURCHASE OF NEW COMMON STOCK;
CLOSING

 

SECTION 1.1         Purchase
of New Common Stock.

 

(a)           On
the terms and subject to the conditions set forth herein, at the Closing (as
defined below), Purchaser shall purchase from the Company, and the Company
shall sell to Purchaser, 250,000,000 shares of New Common Stock (the “Shares”),
for a price per share equal to $10.00 (the “Per Share Purchase Price”
and, in the aggregate, the “Purchase Price”).  At the Closing, Purchaser shall cause the
Purchase Price to be paid (i) first, to the extent that Purchaser elects
by written notice to the Company not less than three Business Days prior to the
Closing Date, by the application of any claims against the Debtors that are
held by Purchaser (or any Person that Purchaser may designate pursuant to Section 1.1(c) (a
“Permitted Assign”)) and outstanding as of the Effective Date  in an amount equal to the allowed amount
(inclusive of prepetition and postpetition interest accrued up to and on the
Effective Date at the applicable rate provided in the Plan), with each $10.00
in such amount of allowed claims so applied being in satisfaction of the
obligation to pay $10.00 of the Purchase Price and (ii) second, by wire
transfer of immediately available U.S. Dollar funds.  For the avoidance of doubt, Purchaser may
elect which claims to apply in satisfaction of Purchaser’s obligation to pay
the Purchase Price for purposes of clause (i), and the application of such
claims against the Purchase Price in accordance with clause (i) shall
represent complete satisfaction of the Debtors’ obligations in respect of such
allowed claims so applied.  For the
avoidance of doubt and as provided in the Plan, any application by the
Purchaser or the applicable Permitted Assign of allowed claims in satisfaction
of a portion of the Purchase Price shall be effected by causing the Debtor
liable for such claims to make payment for such claims in accordance with the
Plan and by directing the amounts so payable to be paid to the Company and
applied in satisfaction of a portion of the Purchase Price.

 

(b)           All
Shares shall be delivered with any and all issue, stamp, transfer or similar
taxes or duties payable in connection with such delivery duly paid by the
Company to the extent required under the Confirmation Order or applicable Law.

 

(c)           Purchaser,
in its sole discretion, may designate that some or all of the Shares be issued
in the name of, and delivered to, one or more Brookfield Consortium Members,
subject to (i) such action not causing any delay in the obtaining of, or
significantly increasing the risk of not obtaining, any material
authorizations, consents, orders, declarations or approvals necessary to
consummate the transactions contemplated by this Agreement or otherwise
delaying the consummation of such transactions, (ii) such Person shall be
an “accredited investor” (within the meaning of Rule 501 of Regulation D
under the Securities Act) and shall have agreed in writing with and for the
benefit of the Company to be bound by the terms of this Agreement applicable to
Purchaser set forth in Section 6.4 of this Agreement and the
transfer restrictions set forth in the Plan, including the delivery of the
letter certifying compliance with the representations and covenants set forth
on Exhibit D to the extent applicable and (iii) Purchaser not
being relieved of 

 

3

 

any
of its obligations under this Agreement ((i), (ii) and (iii) collectively,
the “Designation Conditions”).

 

SECTION 1.2         Closing.  Subject to the satisfaction or waiver of the
conditions (excluding conditions that, by their nature, cannot be satisfied
until the Closing, but subject to the satisfaction or waiver of those
conditions as of the Closing) set forth in Article VII and Article VIII,
the closing of the purchase of the Shares and the GGO Shares by Purchaser
pursuant hereto (the “Closing”) shall occur at 9:30 a.m., New York
time, on the effective date of the Plan (the “Effective Date”), at the
offices of Weil, Gotshal & Manges LLP located at 767 Fifth Avenue, New
York, NY 10153, or such other date, time or location as agreed by the
parties.  The date of the Closing is
referred to as the “Closing Date”. 
Each of the Company and Purchaser hereby agree that in no event shall
the Closing occur unless all of the Shares and the GGO Shares are sold to
Purchaser (or to such other Brookfield Consortium Members as Purchaser may
designate in accordance with and subject to the Designation Conditions) on the
Closing Date.

 

SECTION 1.3         Company
Rights Offering Election.  The
Company may at any time prior to the date of filing of the Disclosure
Statement, upon written notice to Purchaser in accordance with the terms hereof
(the “Rights Offering Election”), irrevocably elect to convert the obligation
of Purchaser to purchase the Shares as contemplated by Section 1.1
hereof into an obligation of Purchaser to participate in a rights offering by
the Company pursuant to which shareholders and/or creditors of the Company are
offered rights to subscribe for shares of New Common Stock (a “Company
Rights Offering”), subject to the execution and delivery of definitive
documentation therefor and the satisfaction of the conditions described therein
and other customary conditions for a public rights offering.  To the extent the Company makes a Rights
Offering Election, (i) Purchaser shall be entitled to a minimum allocation
of shares of New Common Stock in the Company Rights Offering equal to the
number of shares Purchaser would otherwise be required to purchase pursuant to Section 1.1
hereof had no such election been made, (ii) the purchase price per share
payable by Purchaser shall be equal to the Per Share Purchase Price and
Purchaser shall not be otherwise adversely affected as compared to the
transactions contemplated hereby, (iii) the Company Rights Offering shall
be effected in a manner substantially consistent with the procedures
contemplated by Section 2.2 of the Original Agreement, provided that the
Company Rights Offering shall be completed by the Effective Date, and (iv) the
Company and Purchaser shall cooperate in good faith to develop and agree upon
documentation that is reasonably acceptable to both the Company and Purchaser
governing the further terms and conditions of the Company Rights Offering.

 

ARTICLE II

 

GGO SHARE DISTRIBUTION AND
PURCHASE OF GGO COMMON STOCK

 

SECTION 2.1         GGO
Share Distribution.  On the terms and
subject to the conditions (including Bankruptcy Court approval) set forth
herein, the Plan shall provide for the following:

 

(a)           On
or prior to the Effective Date, the Company shall incorporate GGO with issued
and outstanding capital stock consisting of at least the GGO Common Share
Amount of shares of common stock (the “GGO Common Stock”), designate an
employee of the Company familiar with the Identified Assets and reasonably
acceptable to Purchaser to serve as a 

 

4

 

representative
of GGO (the “GGO Representative”) and shall contribute to GGO (directly
or indirectly) the assets (and/or equity interests related thereto) set forth
in Exhibit E hereto and have GGO assume directly or indirectly the
associated liabilities (the “Identified Assets”); provided, however,
that to the extent the Company is prohibited by Law from contributing one or
more of the Identified Assets to GGO or the contribution thereof would breach
or give rise to a default under any Contract, agreement or instrument that
would, in the good faith judgment of the Company in consultation with the GGO
Representative, impair in any material respect the value of the relevant
Identified Asset or give rise to additional liability (other than liability
that would not, in the aggregate, be material) on the part of GGO or the
Company or a Subsidiary of the Company, the Company shall (i) to the
extent not prohibited by Law or would not give rise to such a default, take
such action or cause to be taken such other actions in order to place GGO,
insofar as reasonably possible, in the same economic position as if such
Identified Asset had been transferred as contemplated hereby and so that,
insofar as reasonably possible, substantially all the benefits and burdens
(including all obligations thereunder but excluding any obligations that arise
out of the transfer of the Identified Asset to the extent included in Permitted
Claims) relating to such Identified Asset, including possession, use, risk of
loss, potential for gain and control of such Identified Asset, are to inure
from and after the Closing to GGO (provided, that as soon as a consent
for the contribution of an Identified Asset is obtained or the contractual
impediment is removed or no longer applies, the applicable Identified Asset
shall be promptly contributed to GGO), or (ii) to the extent the actions
contemplated by clause (i) are not possible without resulting in a
material and adverse effect on the Company and its Subsidiaries (as reasonably
determined by the Company in consultation with the GGO Representative),
contribute other assets, with the consent of Purchaser (which Purchaser shall
not unreasonably withhold, condition or delay), having an economically
equivalent value and related financial impact on the Company (in each case, as
reasonably agreed by Purchaser and the Company in consultation with the GGO
Representative) to the Identified Asset not so contributed.  In no event shall the Company (or any
subsidiary of the Company) pay more than $16,000,000 in the aggregate or make
any other payment or provide any other economic consideration to reduce the
principal amount of the mortgage related to 110 N. Wacker Drive, Chicago, Illinois.

 

(b)           The
GGO Common Share Amount of shares of GGO Common Stock, representing all of the
outstanding capital stock of GGO (other than shares of GGO Common Stock to be
issued (x) pursuant to Section 2.2 of this Agreement, (y) to
the Fairholme/Pershing Investors pursuant to Section 2.2 of the
Fairholme/Pershing Agreements and (z) upon exercise of the GGO Warrants
and the warrants issued to the Fairholme/Pershing Investors pursuant to the
Fairholme/Pershing Agreements), shall be distributed, on or prior to the
Effective Date, to the shareholders of the Company (pre-issuance of the Shares)
on a pro rata basis and holders of UPREIT Units (the “GGO Share Distribution”).

 

(c)           It
is agreed that neither the Company nor any of its Subsidiaries shall be
required to pay or cause payment of any fees or make any financial
accommodations to obtain any third-party consent, approval, waiver or other
permission for the contribution contemplated by Section 2.1(a), or
to seek any such consent, approval, waiver or other permission that is
inapplicable to the Company or any of its Debtor Subsidiaries pursuant to the
Bankruptcy Code.

 

(d)           The
parties currently contemplate that the GGO Share Distribution will be
structured as a “tax free spin-off” under the Code.  To the extent that the Company and Purchaser 

 

5

 

jointly
determine that it is desirable for the GGO Share Distribution to be structured
as a taxable dividend, the parties will work together to structure the
transaction to allow for such outcome.

 

(e)           With
respect to the Columbia Master Planned Community (the “CMPC”), it is the
intention of the parties that office and mall assets currently producing any
material amount of income at the CMPC (including any associated right of access
to parking spaces) will be retained by the Company and the remaining non-income
producing assets at the CMPC will be transferred to GGO (including rights to
develop and/or redevelop (as appropriate) the  remainder of the CMPC).  On or prior to the Effective Date, the
Company and GGO shall enter into a mutually satisfactory development and
cooperation agreement with respect to the CMPC, which agreement shall provide, among
other things, that GGO shall grant mutually satisfactory easements, to the
extent not already granted, such that the office buildings retained by GGP (as
provided above) continuously shall have access to parking spaces appropriate
for such office buildings.

 

SECTION 2.2         Purchase
of GGO Common Stock.

 

(a)           On
the terms and subject to the conditions set forth herein, the Plan shall
provide that at the Closing, Purchaser shall purchase from GGO, and GGO shall
sell to Purchaser, 2,625,000 shares of GGO Common Stock (the “GGO Shares”),
for a price per share equal to $47.619048 (the “GGO Per Share Purchase Price”
and such $125,000,000 aggregate purchase price, the “GGO Purchase Price”).  At the Closing the Purchasers shall cause the
GGO Purchase Price to be paid by wire transfer of immediately available U.S.
Dollar funds to such account or accounts as the Company shall have designated
in writing prior to the Closing.

 

(b)           All
GGO Shares shall be delivered with any and all issue, stamp, transfer or
similar taxes or duties payable in connection with such delivery duly paid by
GGO to the extent required under the Confirmation Order or applicable Law.

 

(c)           Purchaser,
in its sole discretion, may designate that some or all of the GGO Shares be
issued in the name of, and delivered to, one or more Brookfield Consortium
Members in accordance with and subject to the Designation Conditions.

 

ARTICLE III

 

REPRESENTATIONS AND WARRANTIES OF
THE COMPANY

 

The Company represents and warrants to Purchaser, as
set forth below, except (i) as set forth in the Company’s Annual Report on
Form 10-K for the year ended December 31, 2009 (but not in documents
filed as exhibits thereto or documents incorporated by reference therein) filed
with the SEC on March 1, 2010 (other than in any “risk factor” disclosure
or any other forward-looking disclosures contained in such reports under the
headings “Risk Factors” or “Cautionary Note” or any similar sections) or (ii) as
set forth in the disclosure schedule delivered by the Company to Purchaser on
the date of this Agreement (the “Company Disclosure Letter”):

 

SECTION 3.1         Organization
and Qualification.  The Company and
each of its direct and indirect Significant Subsidiaries is duly organized and
is validly existing as a corporation or other form of entity, where applicable,
in good standing under the Laws of their respective 

 

6

 

jurisdictions
of organization, with the requisite power and authority to own, operate or
manage its properties and conduct its business as currently conducted, subject,
as applicable, to the restrictions that result from any such entity’s status as
a debtor-in-possession under Chapter 11, except to the extent the failure of
such Significant Subsidiary to be in good standing (to the extent the concept
of good standing is applicable in its jurisdiction of organization) would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.  The Company and each of
its Significant Subsidiaries has been duly qualified as a foreign corporation
or other form of entity for the transaction of business and, where applicable,
is in good standing under the Laws of each other jurisdiction in which it owns,
manages, operates or leases properties or conducts business so as to require
such qualification, except to the extent the failure to be so qualified or,
where applicable, be in good standing would not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.

 

SECTION 3.2         Corporate
Power and Authority.

 

(a)           Subject
to the authorization of the Bankruptcy Court, which shall be contained in the
Confirmation Order, and the expiration or waiver by the Bankruptcy Court of the
14-day period set forth in Bankruptcy Rule 3020(e) following entry of
the Confirmation Order, the Company has the requisite power and authority to
enter into, execute and deliver this Agreement and to perform its obligations
hereunder (except with respect to (i) the issuance of the Warrants, (ii) the
provisions of the Approval Order and (iii) Article IX
hereof).  The Company has taken all
necessary corporate action required for the due authorization, execution,
delivery and performance by it of this Agreement.

 

(b)           Subject
to the entry of the Approval Order, the Company has the requisite power and
authority to (i) issue the Warrants (assuming the accuracy of the
representations of Purchaser contained in Exhibit D), (ii) perform
its obligations pursuant to the provisions of the Approval Order and (iii) Article IX
hereof.  No approval by any securityholders
of the Company or any Subsidiary of the Company is required in connection with
the issuance of the Warrants or the issuance of the shares of Common Stock upon
exercise of the Warrants.

 

(c)           The
Company has received written confirmation from the NYSE that the shares of New
Common Stock or other Equity Securities issuable by the Company to Purchaser
and each Subscribing Entity in connection with each Subscribing Entity’s
exercise of its Subscription Rights contemplated by Section 5.9(a) hereof
shall not require stockholder approval and shall be eligible for listing on the
NYSE in the hands of Purchaser without any requirement for stockholder
approval, in each case, during the five (5) year period following the
Closing Date.

 

SECTION 3.3         Execution
and Delivery; Enforceability.

 

(a)           This
Agreement has been duly and validly executed and delivered by the Company, and
subject to the authorization of the Bankruptcy Court, which shall be contained
in the Confirmation Order, and the expiration or waiver by the Bankruptcy Court
of the 14-day period set forth in Bankruptcy Rule 3020(e) following
entry of the Confirmation Order, shall constitute the valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms, subject to general principles of equity, including principles of
commercial reasonableness, good faith and fair dealing (regardless of whether
enforcement is 

 

7

 

sought
in a proceeding at Law or in equity) (except with respect to (i) the
issuance of the Warrants, (ii) the provisions of the Approval Order and
(iii) Article IX hereof).

 

(b)           Subject
to the entry of the Approval Order, the provisions of this Agreement relating
to (i) the issuance of the Warrants, (ii) the provisions of the
Approval Order and (iii) Article IX hereof shall constitute
the valid and binding obligations of the Company, enforceable against the
Company in accordance with their terms.

 

SECTION 3.4         Authorized
Capital Stock.  As of the date of this
Agreement, the authorized capital stock of the Company consists of 875,000,000
shares of Common Stock and of 5,000,000 shares of preferred stock.  The issued and outstanding capital stock of
the Company and the shares of Common Stock available for grant pursuant to the
Company’s 1993 Stock Incentive Plan, 1998 Stock Incentive Plan and 2003 Stock
Incentive Plan (collectively, the “Company Option Plans”) or otherwise
as of March 26, 2010 (the “Measurement Date”) is set forth on Section 3.4
of the Company Disclosure Letter.  From
the Measurement Date to the date of this Agreement, other than in connection
with the issuance of shares of Common Stock pursuant to the exercise of options
outstanding as of the Measurement Date, there has been no change in the number
of outstanding shares of capital stock of the Company or the number of
outstanding Equity Securities (as defined below).  Except as set forth on Section 3.4
of the Company Disclosure Letter, on the Measurement Date, there was not
outstanding, and there was not reserved for issuance, any (i) share of
capital stock or other voting securities of the Company or its Significant
Subsidiaries; (ii) security of the Company or its Subsidiaries convertible
into or exchangeable or exercisable for shares of capital stock or voting
securities of the Company or its Significant Subsidiaries; (iii) option or
other right to acquire from the Company or its Subsidiaries, or obligation of
the Company or its Subsidiaries to issue, any shares of capital stock, voting
securities or security convertible into or exercisable or exchangeable for
shares of capital stock or voting securities of the Company or its Significant
Subsidiaries, as the case may be; or (iv) equity equivalent interest in
the ownership or earnings of the Company or its Significant Subsidiaries or
other similar right, in each case to which the Company or a Significant
Subsidiary is a party (the items in clauses (i) through (iv) collectively,
“Equity Securities”).  Other than
as set forth on Section 3.4 of the Company Disclosure Letter or as
contemplated by this Agreement, or pursuant to Contracts entered into by the
Company after the date hereof and prior to the Closing that are otherwise not
inconsistent with Purchaser’s rights hereunder and with respect to the
transactions contemplated hereby, and do not confer on any other Person rights
that are superior to those received by Purchaser hereunder or pursuant to the
transactions contemplated hereby other than rights and terms that are
customarily granted to holders of any such Equity Securities so issued and not
customarily granted in transactions such as the transactions contemplated
hereby, there is no outstanding obligation of the Company or its Subsidiaries
to repurchase, redeem or otherwise acquire any Equity Security.  Other than as set forth on Section 3.4
of the Company Disclosure Letter or as contemplated by this Agreement, or
pursuant to Contracts entered into by the Company in connection with the
issuance of Equity Securities after the date hereof and prior to the Closing
that are otherwise not inconsistent with Purchaser’s rights hereunder and with
respect to the transactions contemplated hereby, and do not confer on any other
Person rights that are superior to those received by Purchaser hereunder or pursuant
to the transactions contemplated hereby other than rights and terms that are
customarily granted to holders of any such Equity Securities so issued and not
customarily granted in transactions such as the transactions contemplated
hereby, there is no stockholder 

 

8

 

agreement,
voting trust or other agreement or understanding to which the Company is a
party or by which the Company is bound relating to the voting, purchase,
transfer or registration of any shares of capital stock of the Company or
preemptive rights with respect thereto.  Section 3.4
of the Company Disclosure Letter sets forth a complete and accurate list of the
outstanding Equity Securities of the Company as of the Measurement Date, including
the applicable conversion rates and exercise prices (or, in the case of options
to acquire Common Stock, the weighted average exercise price) relating to the
conversion or exercise of such Equity Securities into or for Common Stock.

 

SECTION 3.5         Issuance.

 

(a)           Subject
to the authorization of the Bankruptcy Court, which shall be contained in entry
of the Confirmation Order, and the expiration or waiver by the Bankruptcy Court
of the 14-day period set forth in Bankruptcy Rule 3020(e) following
entry of the Confirmation Order, the issuance of the Shares and the New
Warrants has been duly and validly authorized. 
Subject to the entry of the Approval Order and assuming the accuracy of
the representations of Purchaser contained in Exhibit D, the
issuance of the Warrants is duly and validly authorized.  When the Shares are issued and delivered in
accordance with the terms of this Agreement against payment therefor, the
Shares shall be duly and validly issued, fully paid and non-assessable and free
and clear of all taxes, liens, pre-emptive rights, rights of first refusal and
subscription rights, other than rights and restrictions under this Agreement,
the Non-Control Agreement and applicable state and federal securities
Laws.  When the Warrants and the New
Warrants are issued and delivered in accordance with the terms of this
Agreement, the Warrants and New Warrants shall be duly and validly issued and
free and clear of all taxes, liens, pre-emptive rights, rights of first refusal
and subscription rights, other than rights and restrictions under this
Agreement, the terms of the Warrants and New Warrants and under applicable
state and federal securities Laws.  When
the shares of Common Stock issuable upon the exercise of the Warrants and the
shares of New Common Stock issuable upon the exercise of the New Warrants are
issued and delivered against payment therefor, the shares of Common Stock and
New Common Stock, as applicable, shall be duly and validly issued, fully paid
and non-assessable and free and clear of all taxes, liens, pre-emptive rights,
rights of first refusal and subscription rights, other than rights and
restrictions under this Agreement, the Non-Control Agreement and applicable
state and federal securities Laws.

 

(b)           Subject
to the authorization of the Bankruptcy Court, which shall be contained in the
entry of the Confirmation Order, and the expiration or waiver by the Bankruptcy
Court of the 14-day period set forth in Bankruptcy Rule 3020(e) following
entry of the Confirmation Order, when the GGO Shares and the GGO Warrants are
issued, the GGO Shares and GGO Warrants shall be duly and validly authorized,
duly and validly issued, fully paid and non-assessable and free and clear of
all taxes, liens, pre-emptive rights, rights of first refusal and subscription
rights, other than rights and restrictions under this Agreement and under
applicable state and federal securities Laws. 
When the shares of GGO Common Stock issuable upon the exercise of the
GGO Warrants are issued and delivered against payment therefor, the shares of
GGO Common Stock shall be duly and validly issued, fully paid and
non-assessable and free and clear of all taxes, liens, pre-emptive rights,
rights of first refusal and subscription rights, other than rights and
restrictions under this Agreement and under applicable state and federal
securities Laws.

 

9

 

SECTION 3.6         No
Conflict.

 

(a)           Subject
to (i) the receipt of the consents set forth on Section 3.6 of
the Company Disclosure Letter, (ii) such authorization as is required by
the Bankruptcy Court or the Bankruptcy Code, which shall be contained in the
entry of the Confirmation Order, and the expiration, or waiver by the
Bankruptcy Court, of the 14-day period set forth in Bankruptcy Rule 3020(e) following
entry of the Confirmation Order, (iii) any provisions of the Bankruptcy
Code that override, eliminate or abrogate such consents or as may be ordered by
the Bankruptcy Court and (iv) the ability to employ the alternatives
contemplated by Section 2.1 of the Agreement, the execution and
delivery (or, with respect to the Plan, the filing) by the Company of this
Agreement and the Plan, the performance by the Company of its respective
obligations under this Agreement and compliance by the Company with all of the
provisions hereof and thereof and the consummation of the transactions
contemplated herein and therein, (x) shall not conflict with, or result in
a breach or violation of, any of the terms or provisions of, or constitute a
default under, or result in the acceleration of, or the creation of any lien
under, or give rise to any termination right under, any Contract to which the
Company or any of the Company’s Subsidiaries is a party or by which any of
their material assets are subject or encumbered, (y) shall not result in
any violation or breach of any terms, conditions or provisions of the
certificate of incorporation or bylaws of the Company, or the comparable
organizational documents of the Company’s Subsidiaries, and (z) shall not
conflict with or result in any violation or breach of, or any termination or
impairment of any rights under, any statute or any license, authorization,
injunction, judgment, order, decree, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any of its
Subsidiaries or any of their respective properties or assets, except, in the
case of each of clauses (x) and (z) above, for any such conflict,
breach, acceleration, lien, termination, impairment, failure to comply, default
or violation that would not, individually or in the aggregate, be reasonably
expected to have a Material Adverse Effect (except with respect to (i) the
issuance of the Warrants and (ii) the provisions of the Approval Order and
(iii) Article IX hereof).

 

(b)           Subject
to the entry of the Approval Order, (i) the issuance of the Warrants
(assuming the accuracy of the representations of Purchaser contained in Exhibit D),
(ii) the performance by the Company of its respective obligations under
the Approval Order and compliance by the Company with all of the provisions
thereof, and (iii) the performance by the Company of respective
obligations under Article IX hereof (x) shall not conflict
with, or result in a breach or violation of, any of the terms or provisions of,
or constitute a default under, or result in the acceleration of, or the
creation of any lien under, or give rise to any termination right under, any
Contract, (y) shall not result in any violation or breach of any terms,
conditions or provisions of the certificate of incorporation or bylaws of the
Company, or the comparable organizational documents of the Company’s
Subsidiaries, and (z) shall not conflict with or result in any violation
or breach of, or any termination or impairment of any rights under, any statute
or any license, authorization, injunction, judgment, order, decree, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of its Subsidiaries or any of their respective properties or
assets, except, in the case of each of clauses (x) and (z) above, for
any such conflict, breach, acceleration, lien, termination, impairment, failure
to comply, default or violation that would not, individually or in the
aggregate, be reasonably expected to have a Material Adverse Effect.

 

10

 

SECTION 3.7         Consents and Approvals.

 

(a)           No consent, approval, authorization, order,
registration or qualification of or with any Governmental Entity having
jurisdiction over the Company or any of its Subsidiaries or any of their
respective properties is required for (i) (1) the issuance and
delivery of the New Warrants, (2) the issuance, sale and delivery of
Shares, (3) the issuance and delivery of the Warrants, (4) the
issuance, sale and delivery of the GGO Shares, (5) the issuance and
delivery of the GGO Warrants, (6) the issuance of New Common Stock upon
exercise of the New Warrants, (7) the issuance of GGO Common Stock upon
exercise of the GGO Warrants and (8) the issuance of Common Stock upon
exercise of the Warrants and (ii) the execution and delivery by the
Company of this Agreement or the Plan and performance of and compliance by the
Company with all of the provisions hereof and thereof and the consummation of
the transactions contemplated herein and therein, except (A) such
authorization as is required by the Bankruptcy Court or the Bankruptcy Code,
which shall be contained in the entry of the relevant Court Order, and the
expiration, or waiver by the Bankruptcy Court, of the 14-day period set forth
in Bankruptcy Rule 3020(e) following entry of the Confirmation Order,
as applicable (except with respect to (i) the issuance of the Warrants,
(ii) the provisions of the Approval Order and (iii) Article IX
hereof), (B) filings required under, and compliance with (other than
shareholder approval requirements in respect of the issuance of the Warrants),
the applicable requirements of the Exchange Act and the rules and
regulations promulgated thereunder, the Securities Act and the rules and
regulations promulgated thereunder, and the rules of the New York Stock
Exchange, and (C) such other consents, approvals, authorizations, orders,
registrations or qualifications that, if not obtained, made or given, would not
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect.

 

(b)           No consent, approval, authorization, order,
registration or qualification of or with any Governmental Entity having
jurisdiction over the Company or any of its Subsidiaries or any of their
respective properties is required for (1) the issuance and delivery of the
Warrants, (2) the performance of and compliance by the Company with all of
the provisions of the Approval Order, and (3) the performance of and
compliance by the Company with Article IX hereof, except (A) the
entry of the Approval Order, (B) filings required under, and compliance
with (other than shareholder approval requirements in respect of the issuance
of the Warrants), the applicable requirements of the Exchange Act and the rules and
regulations promulgated thereunder, the Securities Act and the rules and
regulations promulgated thereunder, and the rules of the New York Stock
Exchange, and (C) such other consents, approvals, authorizations, orders,
registrations or qualifications that, if not obtained, made or given, would not
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect.

 

SECTION 3.8         Company Reports.

 

(a)           The Company has filed with or otherwise furnished to
the Securities and Exchange Commission (the “SEC”) all material forms,
reports, schedules, statements and other documents required to be filed or
furnished by it under the United States Securities Act of 1933, as amended (the
“Securities Act”) or the Exchange Act since December 31, 2007 (such
documents, as supplemented or amended since the time of filing, and together
with all information incorporated by reference therein, the “Company SEC
Reports”).  No Subsidiary of the
Company is required to file with the SEC any such forms, reports, schedules,
statements or 

 

11

 

other
documents pursuant to Section 13 or 15 of the Exchange Act.  As of their respective effective dates (in
the case of Company SEC Reports that are registration statements filed pursuant
to the requirements of the Securities Act) and as of their respective filing
dates (in the case of all other Company SEC Reports), except as and to the
extent modified, amended, restated, corrected, updated or superseded by any
subsequent Company SEC Report filed and publicly available prior to the date of
this Agreement, the Company SEC Reports (i) complied in all material
respects with the applicable requirements of the Securities Act and the
Exchange Act, and the rules and regulations of the SEC promulgated
thereunder applicable to such Company SEC Reports, and  (ii) did not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.

 

(b)           The Company maintains a system of “internal controls
over financial reporting” (as defined in Rules 13a-15(f) and
15a-15(f) under the Exchange Act) that provides reasonable assurance
regarding the reliability of the Company’s financial reporting and the
preparation of the Company’s financial statements for external purposes in
accordance with GAAP and that includes policies and procedures that
(i) pertain to the maintenance of records that, in reasonable detail,
accurately and fairly reflect the transactions and dispositions of the assets
of the Company, (ii) provide reasonable assurance that transactions are
recorded as necessary to permit preparation of financial statements in
accordance with GAAP, and that receipts and expenditures of the Company are
being made only in accordance with authorizations of management and directors
of the Company, and (iii) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use, or disposition
of the Company’s assets that could have a material effect on the Company’s
financial statements.

 

(c)           The Company maintains a system of “disclosure
controls and procedures” (as defined in Rules 13a-15(e) and 15d-15(e) under
the Exchange Act) that is reasonably designed to ensure that information
required to be disclosed by the Company in the reports that it files or submits
under the Exchange Act is recorded, processed, summarized and reported within
the time periods specified in the rules and forms of the SEC, and that
information relating to the Company is accumulated and communicated to the
Company’s management as appropriate to allow timely decisions regarding
required disclosure and to make the certifications of the Chief Executive
Officer and Chief Financial Officer of the Company required under the Exchange
Act with respect to such reports.

 

(d)           Since December 31, 2008, the Company has not
received any oral or written notification of a “material weakness” in the
Company’s internal controls over financial reporting.  The term “material weakness” shall have the
meaning assigned to it in the Statements of Auditing Standards 112 and 115, as
in effect on the date hereof.

 

(e)           Except as and to the extent modified, amended,
restated, corrected, updated or superseded by any subsequent Company SEC Report
filed and publicly available prior to the date of this Agreement, the audited
consolidated financial statements and the unaudited consolidated interim
financial statements (including any related notes) included in the Company SEC
Reports fairly present in all material respects, the consolidated financial
position of the Company and its consolidated Subsidiaries as of the dates
thereof and the consolidated results of their operations and their consolidated
cash flows for the periods set forth therein (subject, in the 

 

12

 

case
of financial statements for quarterly periods, to normal year-end adjustments)
and were prepared in conformity with GAAP consistently applied during the
periods involved (except as otherwise disclosed in the notes thereto).

 

SECTION 3.9         No Undisclosed Liabilities.  None of the Company or its Subsidiaries has
any material liabilities (whether absolute, accrued, contingent or otherwise)
required to be reflected or reserved against on a consolidated balance sheet of
the Company prepared in accordance with GAAP, except for liabilities (i) reflected
or reserved against or provided for in the Company’s consolidated balance sheet
as of December 31, 2009 or disclosed in the notes thereto, included in the
Company’s Annual Report on Form 10-K for the year ended December 31,
2009, (ii) incurred in the ordinary course of business consistent with
past practice since the date of such balance sheet, (iii) for fees and
expenses incurred in connection with the Bankruptcy Cases, which have been
estimated and included in the Admin/Priority Claims identified in the Plan
Summary Term Sheet; provided, however, that such amount is an
estimate and actual results may be higher or lower, (iv) incurred in the
ordinary course of performing this Agreement and certain other asset sales,
transfers and other actions permitted under this Agreement and (v) other
liabilities at Closing as contemplated by the Plan Summary Term Sheet.

 

SECTION 3.10       No Material Adverse Effect.  Since December 31, 2009, there has not
occurred any event, fact or circumstance that has had or would reasonably be
expected to have, individually, or in the aggregate, a Material Adverse Effect.

 

SECTION 3.11       No Violation or Default:  Licenses and Permits.  The Company and its Subsidiaries (a) are
in compliance with all Laws, statutes, ordinances, rules, regulations, orders,
judgments and decrees of any court or governmental agency or body having
jurisdiction over the Company or any of its Subsidiaries or any of their
respective properties, and (b) has not received written notice of any
alleged material violation of any of the foregoing except, in the case of  each of clauses (a) and (b) above,
for any such failure to comply, default or violation that would not,
individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect or as may be the result of the Company’s or any of its
Subsidiaries’ Chapter 11 filing or status as a debtor-in-possession under
Chapter 11.  Subject to the restrictions
that result from the Company’s or any of its Subsidiaries’ status as a
debtor-in-possession under Chapter 11 (including that in certain instances the
Company’s or such Subsidiary’s conduct of its business requires Bankruptcy
Court approval), each of the Company and its Subsidiaries holds all material
licenses, franchises, permits, certificates of occupancy, consents,
registrations, certificates and other governmental and regulatory permits,
authorizations and approvals required for the operation of the business as
currently conducted by it and for the ownership, lease or operation of its
material assets except, in each case, where the failure to possess or make the
same would not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.

 

SECTION 3.12       Legal Proceedings.  There are no legal, governmental or
regulatory investigations, actions, suits or proceedings pending or, to the
Knowledge of the Company, threatened against the Company or any of its Subsidiaries
which, individually, if determined adversely to the Company or any of its
Subsidiaries, would reasonably be expected to have a Material Adverse Effect.

 

13

 

SECTION 3.13       Investment Company Act.  The Company is not, and, after giving effect
to the offering and sale of the Shares and the application of the proceeds
thereof, shall not be required to register as an “investment company” or an
entity “controlled” by an “investment company” within the meaning of the
Investment Company Act of 1940, as amended, and the rules and regulations
of the SEC thereunder.  As of the
Effective Date, GGO, after giving effect to the offering and sale of the GGO
Shares and the application of the proceeds thereof, shall not be required to
register as an “investment company” or an entity “controlled” by an “investment
company” within the meaning of the Investment Company Act of 1940, as amended,
and the rules and regulations of the SEC thereunder.

 

SECTION 3.14       Compliance With Environmental Laws.  Except as would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect, (i) each
of the Company and its Subsidiaries are and have been in compliance with and
each of the Company Properties are and have been maintained in compliance with,
any and all applicable federal, state, local and foreign Laws relating to the
protection of the environment or natural resources, human health and safety as
such relates to the environment, or the presence, handling, or release of
Hazardous Materials (collectively, “Environmental Laws”), which
compliance includes obtaining, maintaining and complying with all permits,
licenses or other approvals required under Environmental Laws to conduct
operations as presently conducted, and no action is pending or, to the
Knowledge of the Company, threatened that seeks to repeal, modify, amend,
revoke, limit, deny renewal of, or otherwise appeal or challenge any such
permits, licenses or other approvals, (ii) none of the Company or its
Subsidiaries have received any written notice of, and none of the Company
Properties have been the subject of any written notice received by the Company
or any of its Subsidiaries of, any actual or potential liability or violation
for the presence, exposure to, investigation, remediation, arrangement for
disposal, or release of any material classified, characterized or regulated as
hazardous, toxic, pollutants, or contaminants under Environmental Laws,
including petroleum products or byproducts, radioactive materials,
asbestos-containing materials, radon, lead-containing materials,
polychlorinated biphenyls, mold, and hazardous building materials
(collectively, “Hazardous Materials”), (iii) none of the Company
and its Subsidiaries are a party to or the subject of any pending, or, to the
Knowledge of the Company, threatened, legal proceeding alleging any liability,
responsibility, or violation under any Environmental Laws with respect to their
past or present facilities or their respective operations, (iv) none of
the Company and its Subsidiaries have released Hazardous Materials on any real
property in a manner that would reasonably be expected to result in an
environmental claim or liability against the Company or any of its Subsidiaries
or Affiliates, (v) none of the Company Properties is the subject of any
pending, or, to the Knowledge of the Company, threatened, legal proceeding
alleging any liability, responsibility, or violation under any Environmental
Laws, and (vi) to the Knowledge of the Company, there has been no release
of Hazardous Materials on, from, under, or at any of the Company Properties
that would reasonably be expected to result in an environmental claim or
liability against the Company or any of its Subsidiaries or Affiliates.

 

SECTION 3.15       Company Benefit Plans.

 

(a)           Except as would not, individually or in the
aggregate, have a Material Adverse Effect, each Company Benefit Plan is in
compliance in design and operation in all material respects with all applicable
provisions of ERISA and the U.S. Internal Revenue Code of 1986, as 

 

14

 

amended
(the “Code”) and each Company Benefit Plan that is intended to be
qualified under Section 401(a) of the Code has received a favorable
determination letter from the Internal Revenue Service with respect to its
qualified status under Section 401(a) of the Code and its related
trust’s exempt status under Section 501(a) of the Code and the
Company is not aware of any circumstances likely to result in the loss of the
qualification of any such plan under Section 401(a) of the Code.

 

(b)           Except as would not, individually or in the
aggregate, have a Material Adverse Effect, with respect to each Company Benefit
Plan that is subject to Title IV or Section 302 of ERISA or
Section 412 or 4971 of the Code: 
(A) no Company Benefit Plan has failed to satisfy the minimum
funding standard (within the meaning of Sections 412 and 430 of the Code or
Section 302 of ERISA) applicable to such Company Benefit Plan, whether or
not waived and no application for a waiver of the minimum funding standard with
respect to any Company Benefit Plan has been submitted; (B) no reportable
event within the meaning of Section 4043(c) of ERISA for which the
30-day notice requirement has not been waived has occurred (other than in
connection with the Bankruptcy Cases); (C) no liability (other than for
premiums to the Pension Benefit Guaranty Corporation (the “PBGC”)) under
Title IV of ERISA has been or is expected to be incurred by the Company or
any entity that is required to be aggregated with the Company pursuant to
Section 414 of the Code (an “ERISA Affiliate”); (D) the PBGC
has not instituted proceedings to terminate any such plan or made any inquiry
which would reasonably be expected to lead to termination of any such plan,
and, no condition exists that presents a risk that such proceedings will be
instituted or which would constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any such
plan; and (E) no Company Benefit Plan is, or is expected to be, in
“at-risk” status (as defined in Section 303(i)(4) of ERISA or
Section 430(i)(4) of the Code).

 

(c)           Except as would not, individually or in the
aggregate, have a Material Adverse Effect, with respect to each Company Benefit
Plan maintained primarily for the benefit of current or former employees,
officers or directors employed, or otherwise engaged, outside the United States
(each a “Foreign Plan”), excluding any Foreign Plans that are
statutorily required, government sponsored or not otherwise sponsored,
maintained or controlled by the Company or any of its Significant Subsidiaries
(“Excluded Non-US Plans”):  (A) (1) all
employer and employee contributions required by Law or by the terms of the
Foreign Plan have been made, and all liabilities of the Company and its
Significant Subsidiaries have been satisfied, or, in each case accrued, by the
Company and its Significant Subsidiaries in accordance with generally accepted
accounting principles, and (2) the Company and its Significant
Subsidiaries are in compliance with all requirements of applicable Law and the
terms of such Foreign Plan; (B) as of the Effective Date, the fair market
value of the assets of each funded Foreign Plan, or the book reserve
established for each Foreign Plan, together with any accrued contributions, is
sufficient to procure or provide for the accrued benefit obligations with
respect to all current and former participants in such Foreign Plan determined
on an ongoing basis (rather than on a plan termination basis) according to the
actuarial assumptions and valuations used to account for such obligations as of
the Effective Date in accordance with applicable generally accepted accounting
principles; and (C) the Foreign Plan has been registered as required and
has been maintained in good standing with applicable regulatory authorities.

 

15

 

SECTION 3.16       Labor and Employment Matters.  (i) Neither the Company nor any of its
Significant Subsidiaries is a party to or bound by any collective bargaining
agreement or any labor union contract, nor are any employees of the Company or
any of its Significant Subsidiaries represented by a works council or a labor
organization (other than any industry-wide or statutorily mandated agreement in
non-U.S. jurisdictions); (ii) to the Knowledge of the Company, as of the
date hereof, there are no activities or proceedings by any labor union or labor
organization to organize any employees of the Company or any of its Significant
Subsidiaries or to compel the Company or any of its Significant Subsidiaries to
bargain with any labor union or labor organization; and (iii), except as would
not, individually or in the aggregate, have a Material Adverse Effect, there is
no pending or, to the Knowledge of the Company, threatened material labor
strike, lock-out, walkout, work stoppage, slowdown, demonstration, leafleting,
picketing, boycott, work-to-rule campaign, sit-in, sick-out, or similar
form of organized labor disruption.

 

SECTION 3.17       Insurance.  The Company maintains for itself and its
Subsidiaries insurance policies in those amounts and covering those risks, as
in its judgment, are reasonable for the business and assets of the Company and
its Subsidiaries.

 

SECTION 3.18       No Unlawful Payments.  No action is pending or, to the Knowledge of
the Company, is threatened against the Company or any of its Subsidiaries or
Affiliates, or any of their respective directors, officers, or employees
resulting from any (a) use of corporate funds for any unlawful
contribution, gift, entertainment or other unlawful expense relating to
political activity, (b) direct or indirect unlawful payment to any foreign
or domestic government official or employee from corporate funds, (c) violations
of any provision of the Foreign Corrupt Practices Act of 1977 or any other
applicable local anti-bribery or anti-corruption Laws in any relevant
jurisdictions or (d) other unlawful payment, except in any such case, as
would not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.

 

SECTION 3.19       No Broker’s Fees.  Other than pursuant to agreements (including
amendments thereto) by and between the Company and each of UBS Securities LLC
and Miller Buckfire & Co., LLC, or otherwise disclosed to Purchaser
prior to the date hereof and which fees and expenses would be included in the
definition of “Permitted Claims”, none of the Company or any of its
Subsidiaries is a party to any contract, agreement or understanding with any
person (other than this Agreement) that would give rise to a valid claim
against the Company or any of its Subsidiaries for an investment banking fee,
finder’s fee or like payment in respect of the sale of the Shares contemplated by
this Agreement.  None of the Company or
any of its Subsidiaries is a party to any contract, agreement or understanding
with any Person that would give rise to a valid claim against Purchaser for a
brokerage commission, finder’s fee, investment banking fee or like payment in
connection with the transactions contemplated by this Agreement.

 

SECTION 3.20       Real and Personal Property.

 

(a)           Section 3.20(a) of the Company Disclosure
Letter sets forth a true, correct and complete list in all material respects of
each material real property asset owned or leased (as lessee), directly or
indirectly, in whole or in part, by the Company and/or any of its Subsidiaries
(other than Identified Assets) (each such property that is not a
Non-Controlling Property and has a fair market value (in the reasonable
determination of the Company) in excess of $10,000,000 is 

 

16

 

individually
referred to herein as “Company Property” and collectively referred to
herein as the “Company Properties”). 
All Company Properties, Non-Controlling Properties and the Identified
Assets are reflected in accordance with the applicable rules and
regulations of the SEC in the Annual Report in Form 10-K as of, and for
the year ended, December 31, 2009 (the “Most Recent Statement”).

 

(b)           Except (i) for such breach of this Section 3.20(b) as
may be caused fully or substantially by the third party member or partner in
any Joint Venture, without the Knowledge or consent of the Company or any of
its Subsidiaries or (ii) as would not individually or in the aggregate be
reasonably expected to have a Material Adverse Effect, the Company or one of
its Subsidiaries owns good and valid fee simple title or valid and enforceable
leasehold interests (except with respect to the Company’s right to reject any
such ground lease as part of a Bankruptcy plan of reorganization for the
remaining Debtor entities and subject to applicable bankruptcy, insolvency,
reorganization, moratorium and similar Laws affecting creditors’ rights and
remedies generally, and subject, as to enforceability, to general principles of
equity, including principles of commercial reasonableness, good faith and fair
dealing (regardless of whether enforcement is sought in a proceeding at Law or
in equity)), as applicable, to each of the Company Properties, in each case,
free and clear of liens, mortgages or deeds of trust, claims against title,
charges that are liens or other encumbrances on title, rights of way,
restrictive covenants, declarations or reservations of an interest in title
(collectively, “Encumbrances”), except for the following (collectively,
the “Permitted Title Exceptions”): 
(i) Encumbrances relating to the DIP Loan and to debt obligations
reflected in the Company’s financial statements and the notes thereto
(including with respect to debt obligations which are not consolidated) or
otherwise disclosed to Purchaser in Section 3.20(g)(i) of the
Company Disclosure Letter, (ii) Encumbrances that result from any
statutory or other liens for Taxes or assessments that are not yet due or
delinquent or the validity of which is being contested in good faith by
appropriate proceedings and for which a sufficient and appropriate reserve has
been set aside for the full payment thereof, (iii) any contracts, or other
occupancy agreements to third parties for the occupation or use of portions of
the Company Properties by such third parties in the ordinary course of the
business of the Company or its Subsidiaries, (iv) Encumbrances imposed or
promulgated by Law or any Governmental Entity, including zoning, entitlement
and other land use and environmental regulations, (v) Encumbrances
disclosed on existing title policies and current title insurance commitments or
surveys made available to Purchaser, (vi) Encumbrances on the landlord’s
fee interest at any Company Property where the Company or its Subsidiary is the
tenant under any ground lease, provided that, except as disclosed to Purchaser
in Section 3.20(b)(ii) of the Company Disclosure Letter,
neither the Company nor any of its Subsidiaries have received a notice
indicating the intention of the landlord under such ground lease, or of any
other Person, to (1) exercise a right to terminate such ground lease,
evict the lessee or otherwise collect the sub-rents thereunder, or (2) take
any other action that would be reasonably likely to result in a termination of
such ground lease, (vii) any cashiers’, landlords’, workers’, mechanics’,
carriers’, workmen’s, repairmen’s and materialmen’s liens and other similar
liens (1) incurred in the ordinary course of business which (A) are
being challenged in good faith by appropriate proceedings and for which a
sufficient and appropriate reserve has been set aside for the full payment
thereof or (B) have been otherwise fully bonded and discharged of record
or for which a sufficient and appropriate reserve has been set aside for the
full payment thereof or (2) disclosed on Section 3.20(b)(i) of
the Company Disclosure Letter  and (viii) any
other easements, rights-of-way, restrictions (including zoning restrictions),
covenants, encroachments, protrusions and other 

 

17

 

similar
charges or encumbrances, and title limitations or title defects, if any, that
(I) are customary for office, industrial, master planned communities and
retail properties or (II) individually or in the aggregate, would not be
reasonably expected to have a Material Adverse Effect.  Other than as set forth on Section 3.20(b)(ii) of
the Company Disclosure Letter, neither the Company nor any of its Subsidiaries
has received a written notice of a material default, beyond any applicable
grace and cure periods, of or under any Permitted Title Exceptions, except (w) as
may have been caused fully or substantially by the third party member or
partner in any Joint Venture, without the Knowledge or consent of the Company
or any of its Subsidiaries (x) as a result of the filing of the Bankruptcy
Cases, (y) where the Permitted Title Exceptions are in and of themselves
evidence of default (such as mechanics’ liens and recorded notices of default)
or (z) as would not, individually or in the aggregate, be reasonably
expected to have a Material Adverse Effect; provided, however, that where the
Company has otherwise represented and warranted to Purchaser hereunder
(including as set forth on the Company Disclosure Letter pursuant to such
representations and warranties) with respect to the Company’s Knowledge of, the
Company’s receipt of notice of or the existence of a default in connection with
a particular category of Permitted Title Exceptions, such categories of
Permitted Title Exceptions shall not be included in the representation set
forth in this sentence (by way of illustration, but not exclusion, the
representations set forth in Section 3.20(f) with respect to
defaults under Material Leases shall be deemed to address the Company’s
representations and warranties with respect to the entire category of Permitted
Title Exceptions detailed in clause (iii) above).

 

(c)           To the extent available, the Company and its
Subsidiaries have made commercially reasonable efforts to make available or
will use commercially reasonable efforts to make available upon request to
Purchaser those policies of title insurance that the Company or its
Subsidiaries have obtained in the last six months.

 

(d)           With respect to each Company Ground Lease Property,
except as set forth on Section 3.20(d) of the Company
Disclosure Letter and except as may have been caused by, or disclosed in the
filing of the Bankruptcy Cases, as of the date hereof, to the Company’s
Knowledge, neither the Company nor any of its Subsidiaries has received notice
of material defaults (including, without limitation, payment defaults, but
limited to those circumstances where such default may grant the landlord under
such ground lease the right to terminate such ground lease, evict the lessee or
otherwise collect the sub-rents thereunder) at such Company Ground Lease
Property beyond any applicable grace and cure periods, except (x) as would
not, individually or in the aggregate, be reasonably expected to have a
Material Adverse Effect, (y) as may be caused fully or substantially by
the third party member or partner in any Joint Venture, without the Knowledge
or consent of the Company or any of its Subsidiaries and (z) with respect
to any Company Ground Lease Property which is leased by a Subsidiary of the
Company which has consummated a plan of reorganization in the Bankruptcy Cases,
all such material defaults at such Company Ground Lease Property which existed
prior to the effective date of such Person’s plan of reorganization have been
or will be cured in accordance with such plan. 
As used herein the term “Company Ground Lease Property” shall
mean any Company Property having a fair market value (in the reasonable
determination of the Company) in excess of $25,000,000 which is leased by a
Subsidiary of the Company as tenant pursuant to a ground lease.  With respect to the defaults referenced in
clause (z) above, the Bankruptcy Court approved the Debtors’ assumption of
the applicable ground leases and the fixed cure amounts for such defaults which

 

18

 

predated
assumption; provided however, nothing contained herein precludes any Person
from raising issues in the future with respect to defaults that may have
predated such assumption.

 

(e)           Except as set forth on Section 3.20(e) of
the Company Disclosure Letter, neither the Company nor any of its Subsidiaries
is a party to any agreement relating to the property management (but not
including any leasing, development, construction or brokerage agreements) of
any of the Company Properties by a party other than Company or any wholly owned
Company Subsidiaries, except (i) management agreements that may be
terminated without cause or payment of a termination fee upon no more than 60
days notice or (ii) as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

 

(f)            Except as set forth on Section 3.20(f) of
the Company Disclosure Letter, to the Company’s Knowledge, as of February 15,
2010, (i) each Material Lease is in full force and effect, (ii) no
tenant is in arrears in the payment of rent, additional rent or any other
material charges due under any Material Lease, and no tenant is materially in
default in the performance of any other obligations under any Material Lease,
(iii) no bankruptcy or insolvency proceeding has been commenced (and is
continuing) by or against any tenant under any Material Lease, and (iv) neither
the Company nor any of its Subsidiaries has received a written notice from a
current tenant under any Material Lease exercising a right to terminate or
otherwise cancel its Material Lease (y) as a result of or in connection
with the termination or cancellation of any other lease, sublease, license or
occupancy agreement for space at any Company Property (each, a “Company
Property Lease”), or (z) as a result of or in connection with any
other tenant that occupies, or had previously occupied, another Company Property
Lease, allowing, or having had allowed, all or any portion of the premises
leased pursuant to such other Company Property Lease to “go dark” or otherwise
be abandoned or vacated; except, (A) in the case of each of clauses (i),
(ii) (iii) and (iv) above, as would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect, (B) as
a result of the filing of the Bankruptcy Cases or in connection with any
Bankruptcy Court approved process and (C) as may have been caused fully or
substantially by the third party member or partner in any Joint Venture,
without the Knowledge or consent of the Company or its Subsidiaries.  “Material Lease” means for any Company
Property any lease in which the Company or its Subsidiaries is the landlord,
and all amendments, modifications, supplements, renewals, exhibits, schedules,
extensions and guarantees related thereto, (1) to an “anchor tenant”
occupying at least 80,000 square feet with respect to such Company Property or
(2) that is one of the five (5) largest leases, in terms of gross
annual minimum rent, with respect to a Company Property that has an annual net
operating income, as determined in accordance with GAAP (provided, however,
that for purposes of such calculation, the following were reflected as
expenses:  (a) ground rent payments
to a third party and (b) an assumed management fee equal to 3% of base
minimum and percentage rent) with respect to the trailing twelve (12) calendar
month period, equal to at least $7,500,000.00. 
For purposes of Section 7.1(c), (y) the representations
and warranties made in  Section 3.20(f)(i),
(iii) and (iv), disregarding all qualifications and
exceptions contained therein relating to “materiality” or “Material Adverse
Effect”, shall be shall be true and correct at and as of the Closing Date as if
made at and as of the Closing Date, except for such failures to be true and
correct that, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect and (z) the representation and
warranties contained in Section 3.20(f)(ii), disregarding all
qualifications and exceptions contained therein relating to “materiality” or
“Material Adverse Effect”, shall be true and correct (A) at and as of the
last day of the calendar month that is two 

 

19

 

(2) calendar
months prior to the calendar month in which the Closing Date occurs as if made
at and as of such date, if the Closing Date occurs on or prior to the fifteenth
(15th) day of a calendar month, or (B) at and as of the fifteenth (15th)
day of the calendar month that is one (1) calendar month prior to the
calendar month in which the Closing Date occurs as if made at and as of such
date, if the Closing Date occurs on or after the sixteenth (16th) day of a
calendar month, except for such failures to be true and correct that,
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect.

 

(g)           With respect to each Company Property:

 

(i)            As of the date listed
thereunder, Section 3.20(g) of the Company Disclosure Letter sets
forth a true, correct and complete list in all material respects of (i) all
loans (other than the DIP Loan) and other indebtedness secured by a mortgage,
deed of trust, deed to secure debt or indemnity deed of trust in such Company
Property (each, a “Company Mortgage Loan”), (ii) the outstanding
principal balance of each such Company Mortgage Loan, (iii) the rate of
interest applicable to such Company Mortgage Loan and (iv) the maturity
date of such Company Mortgage Loan;

 

(ii)           Except as set forth in
Section 3.20(g) of the Company Disclosure Letter, neither the Company
nor any of its Subsidiaries have received a written notice of default (beyond
any applicable grace or cure periods) in the (y) payment of interest,
principal or other material amount due to the lender under any Company Mortgage
Loan, whether as the primary obligor or as a guarantor thereof or (z) performance
of any other material obligations under any Company Mortgage Loan, except (i) with
respect to (y) and (z) above, as a result of the filing of the
Bankruptcy Cases, or as is prohibited, stayed or otherwise suspended as a
result of the Company’s or any Subsidiary’s Chapter 11 filing or status as a
debtor-in-possession under Chapter 11, and (ii) with respect solely to (z) above,
which would not individually or in the aggregate, be reasonably expected to
have a Material Adverse Effect; and

 

(iii)          For purposes of Section 7.1(c) the
representations and warranties made in Section 3.20(g)(i),
disregarding all qualifications and exceptions contained therein relating to
“materiality” or “Material Adverse Effect”, shall be true and correct at and as
of the Closing Date as if made at and as of the Closing Date, except for (A) such
inaccuracies caused by sales, purchases, transfers of assets, refinancing or
other actions effected in accordance with, subject to the limitations contained
in, and not otherwise prohibited by, the terms and conditions in this
Agreement, including, without limitation, in Article VII, (B) amortization
payments made pursuant to any applicable Company Mortgage Loans and (C) such
failures to be true and correct that, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse Effect.

 

(h)           To the Knowledge of the Company, (i) except as
set forth on Section 3.20(h) of the Company Disclosure Letter,
neither the Company nor any of its Subsidiaries has received a written notice
exercising an option, “buy-sell” right or other similar right to purchase a
Company Property or any material portion thereof which has not previously
closed, except as would not, individually or in the aggregate, reasonably be
expected to have a material adverse effect with respect to such Company
Property and (ii) no Company Property is subject to a purchase and 

 

20

 

sale
agreement or any similar legally binding agreement to purchase such Company
Property or any material portion thereof (other than (x) with respect to
condominium purchase and sale agreements and purchase and sale and early
occupancy agreements or other similar agreements for the sale of condominium
units at the Natick Nouvelle, (y) with respect to builder lot purchase
agreements and other similar agreements for the sale of vacant lots of land to
builders at Bridgeland and (z) as set forth in (i) above) which has
not previously closed.

 

(i)            The Company has conducted due inquiry with respect
to the representations and warranties made in Section 3.20(d), Section 3.20(f) and
Section 3.20(h).

 

SECTION 3.21       Tax Matters.  Except as disclosed on Section 3.21(a) of
the Company Disclosure Letter:

 

(a)           Except in cases where the failure of any of the
following to be true would not result in a Material Adverse Effect:  (i) the Company and each of its
Significant Subsidiaries have filed all Tax Returns required to be filed by
applicable Law prior to the date hereof; (ii) all such Tax Returns were
true, complete and correct in all respects and filed on a timely basis (taking
into account any applicable extensions); (iii) the Company and each of its
Significant Subsidiaries have paid all amounts of Taxes that are due, claimed
or assessed by any taxing authority to be due for the periods covered by such
Tax Returns, other than any Taxes for which adequate reserves (“Adequate
Reserves”) have been established in accordance with GAAP or a claim has
been filed in the Bankruptcy Cases; and (iv) all adjustments of federal
U.S. Tax liability of the Company and its Significant Subsidiaries resulting
from completed audits or examinations have been reported to appropriate state
and local taxing authorities and all resulting Taxes payable to state and local
taxing authorities have been paid.  “Taxes”
means any U.S. federal, state, local, or foreign income, gross receipts,
license, payroll, employment, excise, severance, stamp, occupation, premium,
windfall profits, environmental (including taxes under Section 59A of the
Code), customs duties, capital stock, franchise, profits, withholding, social
security (or similar), unemployment, disability, real property, personal
property, sales, use, transfer, registration, value added, alternative or
add-on minimum, estimated, or other tax of any kind whatsoever, including any
interest, penalty, or addition thereto, whether disputed or not.  “Tax Return” means any return,
declaration, report, claim for refund, or information return or statement
relating to Taxes, including any schedule or attachment thereto, and including
any amendment thereof, including, where permitted or required, combined or
consolidated returns for any group of entities that include the Company or any
of its Significant Subsidiaries.

 

(b)           The Company and each of its REIT Subsidiaries (x) for
all taxable years commencing with the taxable year ended December 31, 2005
through December 31, 2009, has been subject to taxation as a real estate
investment trust within the meaning of Section 856 of the Code (a “REIT”)
and has satisfied all requirements to qualify as a REIT for such years; (y) has
operated since January 1, 2010 to the date hereof in a manner consistent
with the requirements for qualification and taxation as a REIT; and (z) intends
to continue to operate in such a manner as to qualify as a REIT for the current
taxable year.  None of the transactions
contemplated by this Agreement will prevent the Company or any of its REIT Subsidiaries
from so qualifying.  No Subsidiary of the
Company other than a REIT Subsidiary is a corporation for U.S. federal income
tax purposes, other than a corporation that qualifies as a “taxable REIT
subsidiary” within the meaning of Section 856(l) of the Code.  For the purposes of this Agreement, “REIT 

 

21

 

Subsidiary” means each of GGP Ivanhoe, Inc., GGP Holding, Inc.,
GGP Holding II, Inc., Victoria Ward, Limited, GGP -Natick Trust and
GGP/Homart, Inc.

 

(c)           Each Company Subsidiary other than its REIT
Subsidiaries that is a partnership, joint venture, or limited liability company
and which has not elected to be a “taxable REIT subsidiary” within the meaning
of Section 856(l) of the Code has been since its formation treated
for U.S. federal income tax purposes as a partnership or disregarded entity, as
the case may be, and not as a corporation or an association taxable as a
corporation, except where failure to do so would not have a Material Adverse Effect.

 

(d)           Except where the failure to be true would not have a
Material Adverse Effect, the Company and each of its Significant Subsidiaries
have (i) complied in all respects with all applicable Laws, rules, and
regulations relating to the payment and withholding of Taxes (including
withholding and reporting requirements under sections 1441 through 1464, 3401
through 3406, 6041 and 6049 of the Code and similar provisions under any other
Laws) and (ii) within the time and in the manner prescribed by Law, withheld
from employee wages and paid to the proper Governmental Entities all amounts
required to be withheld and paid over.

 

(e)           Except where the failure to be true would not have a
Material Adverse Effect, no audits or other administrative proceedings or court
proceedings are presently pending or to the Knowledge of the Company threatened
with regard to any Taxes or Tax Returns of the Company or any of its
Significant Subsidiaries, other than any audit or administrative proceeding
relating to Taxes for which a claim has been filed in a Debtor’s Chapter 11
case or any other audit or administrative or court proceeding that is not
reasonably expected to result in a material Tax liability to the Company or any
of its Significant Subsidiaries.

 

(f)            The Company has made available to Purchaser complete
and accurate copies of all material Tax Returns requested by Purchaser and
filed by or on behalf of the Company or any of its Significant Subsidiaries for
all taxable years ending on or prior to the Effective Date and for which the
statute of limitations has not expired.

 

(g)           There are no Tax Protection Agreements except for
those the breach of which would not reasonably be expected to have a Material
Adverse Effect.  Neither the Company nor
any Significant Subsidiary has any liability for Taxes of any Person under
Treasury Regulation Section 1.1502-6 (or any similar provision of any
state, local or foreign Law), or as a transferee or successor (by contract or
otherwise), other than (i) to a Subsidiary of the Company or (ii) where
any such liability would not reasonably be expected to have a Material Adverse
Effect.

 

SECTION 3.22       Material Contracts.  Except as would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect, each Material
Contract that shall survive the Bankruptcy Cases is valid and binding on the
Company or any of its Subsidiaries, as applicable, and, to the Knowledge of the
Company, on each other Person party thereto, and is in full force and effect.  Other than as a result of the commencement of
the Bankruptcy Cases, each of the Company and its Subsidiaries has performed,
in all material respects, all obligations required to be performed by it under
each Material Contract that shall survive the Bankruptcy Cases, except, in each
case, as would not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.  Other
than those caused as 

 

22

 

a
result of the filing of the Bankruptcy Cases, neither the Company nor any of
its Significant Subsidiaries is in breach or default of any Material Contract
to which it is a party and which shall survive the Bankruptcy Cases, except, in
each case, as would not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect. 
The Company has made available to Purchaser true, accurate and complete
copies of the Material Contracts as of the date of this Agreement, except for
those Material Contracts available to the public on the website maintained by
the SEC.  To the Knowledge of the
Company, no party to any Material Contract that shall survive the Bankruptcy
Cases has given written notice of any action to terminate, cancel, rescind or
procure a judicial reformation of such Material Contract or any material
provision thereof, which termination, cancellation, rescission or reformation
would reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.  For the avoidance
of doubt, Material Contracts do not include intercompany contracts.

 

SECTION 3.23       Certain Restrictions on Charter and Bylaws
Provisions; State Takeover Laws.

 

(a)           The Company and the Company Board have taken all
appropriate and necessary actions to ensure that the ownership limitations set
forth in Article IV of the Company’s certificate of incorporation shall
not apply to (i) the acquisition of beneficial ownership by Purchaser and
any Brookfield Consortium Member of the Warrants and the shares of Common Stock
issuable upon exercise of the Warrants, (ii) any antidilution adjustments
to those Warrants pursuant to the Warrant Agreement and (iii) any shares
of Common Stock that Purchaser or any Brookfield Consortium Member may be
deemed to own by no actions of its own and (iv) the acquisition of
beneficial ownership of up to an additional 2.5% of the issued and outstanding
shares of Common Stock by any Purchaser or any Brookfield Consortium Member; provided,
however, that such exception to the ownership limitations are only
effective as to Purchaser or any particular Brookfield Consortium Member only
so long as (i) the Company has received executed copies of the
representation certificate contained in Exhibit D from Purchaser or
such Brookfield Consortium Member, it being understood that a Brookfield
Consortium Member shall be required to provide such representations at such
times and only at such times as such Brookfield Consortium Member beneficially
owns Common Stock or New Common Stock in excess of the relevant ownership limit
set forth in the certificate of incorporation of the Company or any stock or
other equity interest owned by such Brookfield Consortium Member in a tenant of
the Company would be treated as constructively owned by Purchaser and (ii) the
representations so provided are true, correct and complete as of the date made
and continue to be true, correct and complete.

 

(b)           The Company Board 
has taken all action necessary to render inapplicable to Purchaser the
restrictions on “business combinations” set forth in Section 203 of the
Delaware General Corporation Law and, to the knowledge of the Company, any
similar “moratorium,” “control share,” “fair price,” “takeover” or “interested
stockholder” law applicable to transactions between Purchaser and the Company.

 

SECTION 3.24       No Other Representations or Warranties.  Except for the representations and warranties
made by the Company in this Article III, neither the Company nor
any other Person makes any representation or warranty with respect to the
Company or its Subsidiaries or their respective business, operations, assets,
liabilities, condition (financial or 

 

23

 

otherwise)
or prospects, notwithstanding the delivery or disclosure to Purchaser or any of
its Affiliates or representatives of any documentation, forecasts or other
information with respect to any one or more of the foregoing.

 

ARTICLE IV

 

REPRESENTATIONS AND WARRANTIES OF
PURCHASER

 

Purchaser represents and warrants to the Company as
set forth below:

 

SECTION 4.1         Organization.  Purchaser is duly organized and is validly
existing and, where applicable, in good standing under the Laws of its
jurisdiction of organization, with the requisite limited liability company
power and authority to undertake and effectuate the transactions contemplated
by this Agreement.  Purchaser has been
duly qualified as a foreign corporation or other form of entity for the
transaction of business and, where applicable, is in good standing under the
Laws of each other jurisdiction in which it operates so as to require such
qualification, except where the failure to be so qualified, licensed or in good
standing would not, individually or in the aggregate, have or be reasonably
expected to materially delay or prevent the consummation of the transactions contemplated
by this Agreement.

 

SECTION 4.2         Power and Authority.  Purchaser has the requisite power and
authority to enter into, execute and deliver this Agreement and to perform its
obligations hereunder and has taken all necessary action required for the due
authorization, execution, delivery and performance by it of this Agreement.

 

SECTION 4.3         Execution and Delivery.  This Agreement has been duly and validly
executed and delivered by Purchaser and constitutes its valid and binding
obligation, enforceable against Purchaser in accordance with its terms.

 

SECTION 4.4         No Conflict.  The execution and delivery of this Agreement
and the performance by Purchaser of its obligations hereunder and compliance by
Purchaser with all of the provisions hereof and the consummation of the
transactions contemplated herein (i) shall not conflict with, or result in
a breach or violation of, any of the terms or provisions of, or constitute a
default under, or result in the acceleration of, or the creation of any lien
under, or give rise to any termination right under, any material contract to
which Purchaser is a party, (ii) shall not result in any violation or
breach of any provisions of the organizational documents of Purchaser and (iii) shall
not conflict with or result in any violation of, or any termination or material
impairment of any rights under, any statute or any license, authorization,
injunction, judgment, order, decree, rule or regulation of any court or
governmental agency or body having jurisdiction over Purchaser or Purchaser’s
properties or assets, except with respect to each of (i), (ii) and (iii),
such conflicts, violations or defaults as would not be reasonably expected to
have a material adverse effect on the ability of Purchaser to consummate the
transactions contemplated hereunder.

 

SECTION 4.5         Consents and Approvals.  No consent, approval, order, authorization,
registration or qualification of or with any Governmental Entity having
jurisdiction over Purchaser is required in connection with the execution and
delivery by Purchaser of this 

 

24

 

Agreement
or the consummation of the transactions contemplated hereby, except such
consents, approvals, orders, authorizations, registration or qualification as
would not reasonably be expected to materially and adversely affect the ability
of Purchaser to perform its obligations under this Agreement.

 

SECTION 4.6         Compliance with Laws.  Since the date of its formation, Purchaser
has been in compliance with all Laws applicable to Purchaser, except, in each
case, for such non-compliance as would not reasonably be expected to materially
and adversely affect the ability of Purchaser to perform its obligations under
this Agreement.

 

SECTION 4.7         Legal Proceedings.  There are no legal, governmental or
regulatory investigations, actions, suits or proceedings pending or, to the
knowledge of Purchaser, threatened against Purchaser which, individually or in
the aggregate, if determined adversely to Purchaser, would materially and adversely
affect the ability of Purchaser to perform its obligations under this
Agreement.

 

SECTION 4.8         No Broker’s Fees.  Purchaser is not party to any contract,
agreement or understanding with any Person that would give rise to a valid
claim against the Company for an investment banking fee, commission, finder’s
fee or like payment in connection with the transactions contemplated by this
Agreement.

 

SECTION 4.9         Sophistication.  Purchaser is, as of the date hereof and shall
be as of the Effective Date, an “accredited investor” within the meaning of
Rule 501(a) under the Securities Act. 
Purchaser understands and is able to bear any economic risks associated
with such investment (including, without limitation, the necessity of holding
such Shares and GGO Shares for an indefinite period of time).

 

SECTION 4.10       Purchaser Intent.  Purchaser is acquiring the Shares, the
Warrants, the GGO Shares, the New Warrants and the GGO Warrants for investment
purposes only and not with a view to or for distributing or reselling such
Shares, Warrants, GGO Shares, New Warrants and GGO Warrants or any part
thereof, without prejudice, however, to Purchaser’s right, subject to the
provisions of this Agreement, at all times to sell or otherwise dispose of all
or any part of such Shares, Warrants, GGO Shares, New Warrants and GGO Warrants
pursuant to an effective registration statement under the Securities Act or
under an exemption from such registration and in compliance with applicable
federal and state securities Laws. 
Purchaser understands that Purchaser must bear the economic risk of its
investment indefinitely.

 

SECTION 4.11       Reliance on Exemptions.  Purchaser understands that the Shares and the
GGO Shares are being offered and sold to Purchaser in reliance upon specific
exemptions from the registration requirements of United States federal and
state securities Laws.

 

SECTION 4.12       REIT Representations.  The representations provided by Purchaser
and, to the extent applicable, its Affiliates, members or Affiliates of
members, set forth on Exhibit D are true, correct and complete as
of the date hereof, and shall be true as of the date of the issuance of the
Warrants and as of the Closing Date, it being understood that Purchaser’s
Affiliates, members or Affiliates of members shall be required to provide such
representations only if such Person beneficially owns Common Stock or New
Common Stock in excess of the 

 

25

 

relevant
ownership limit set forth in the certificate of incorporation of the Company or
any stock or other equity interest owned by such Person in a tenant of the
Company would be treated as constructively owned by Purchaser.

 

SECTION 4.13       No Other Representations or Warranties.  Except for the representations and warranties
made by Purchaser in this Article IV, neither Purchaser nor any
other Person on behalf of Purchaser makes any representation or warranty with
respect to Purchaser or its assets, liabilities, condition (financial or
otherwise) or prospects.

 

SECTION 4.14       Acknowledgement.  Purchaser acknowledges that (a) neither
the Company nor any Person on behalf of the Company is making any
representations or warranties whatsoever, express or implied, beyond those
expressly given by the Company in Article III of this Agreement and
(b) Purchaser has not been induced by, or relied upon, any
representations, warranties or statements (written or oral), whether express or
implied, made by any Person, that are not expressly set forth in Article III
of this Agreement.  Without limiting the
generality of the foregoing, except with respect to the representations and
warranties contained in Article III, Purchaser acknowledges that no
representations or warranties are made with respect to any projections,
forecasts, estimates, budgets, plans or prospect information that may have been
made available to Purchaser or any of its representatives.

 

ARTICLE V

 

COVENANTS OF THE COMPANY AND
PURCHASER

 

SECTION 5.1         Bankruptcy Court Motions and Orders.

 

(a)           No later than the close of business on the date that
is two (2) Business Days following the date of this Agreement, the Company
shall file with the Bankruptcy Court a motion in form and substance
satisfactory to Purchaser (the “Approval Motion”) seeking to obtain
entry of an order in the form attached hereto as Exhibit F (the “Proposed
Approval Order”), which order in the final form if approved by the
Bankruptcy Court (the “Approval Order”) shall approve, among other
things, the issuance of the Warrants to Purchaser and the performance by the
Company of its obligations under the Warrant Agreement.

 

(b)           The Approval Motion, including any exhibits thereto
and any notices or other materials in connection therewith, and any
modifications or amendments to the foregoing, must be in form and substance
reasonably satisfactory to Purchaser.

 

(c)           If the Approval Order shall be appealed by any
Person (or a petition for certiorari or motion for reconsideration, amendment,
clarification, modification, vacation, stay, rehearing or reargument shall be
filed with respect to such order), the Company shall diligently defend against
any such appeal, petition or motion and shall use its reasonable best efforts
to obtain an expedited resolution of any such appeal, petition or motion.  The Company shall keep Purchaser reasonably
informed and updated regarding the status of any such appeal, petition or
motion.

 

(d)           The Company shall provide draft copies of all
motions, notices, statements, schedules, applications, reports and other papers
the Company intends to file with the Bankruptcy Court in connection with the
Approval Order to Purchaser within a reasonable 

 

26

 

period
of time prior to the date the Company intends to file any of the foregoing, and
shall consult in advance in good faith with Purchaser regarding the form and
substance of any such proposed filing with the Bankruptcy Court.

 

SECTION 5.2         Warrants, New Warrants and GGO Warrants.  Within one Business Day of the date of the
entry of the Approval Order, the Company and the warrant agent shall execute
and deliver the warrant and registration rights agreement in the form attached
hereto as Exhibit G (with only such changes thereto as may be
reasonably requested by the warrant agent and reasonably approved by Purchaser)
(the “Warrant Agreement”) pursuant to which there will be issued to
Purchaser 60,000,000 warrants (the “Warrants”) each of which, when
issued, delivered and vested in accordance with the terms of the Warrant
Agreement, will entitle the holder to purchase one (1) share of Common
Stock at an initial price of $15.00 per share subject to adjustment as provided
in the Warrant Agreement.  The Warrant
Agreement shall provide that the Warrants shall vest in accordance with Section 2.2(b) and
Schedule A of the Warrant Agreement.  For
the avoidance of doubt, Warrants that have not vested may not be
exercised.  The Plan shall provide that
upon the Effective Date, the Warrants, regardless of whether or not vested,
shall be cancelled for no consideration. 
The Plan shall also provide that there shall be issued to Purchaser (i) 60,000,000
fully vested warrants (the “New Warrants”) each of which entitles the
holder to purchase one (1) share of New Common Stock at an initial
purchase price of $10.75 per share subject to adjustment as provided in the
underlying warrant agreement and (ii) 4,000,000 fully vested warrants (the
“GGO Warrants”) each of which entitles the holder to purchase one (1) share
of GGO Common Stock  at a price of $50.00
per share subject to adjustment as provided in the underlying warrant
agreement, each in accordance with the terms set forth in a warrant and
registration rights agreement with terms substantially similar to the terms set
forth in the Warrant Agreement, except that the expiration date for each New
Warrant and GGO Warrant shall be the seventh year anniversary of the date on
which such warrants are issued. 
Purchaser, in its sole discretion, may designate that some or all of the
New Warrants or GGO Warrants be issued in the name of, and delivered to, one or
more Brookfield Consortium Members in accordance with and subject to the
Designation Conditions.

 

SECTION 5.3         Assistance with Capital Raising Activities.  Until the earliest to occur of (i) the
termination of this Agreement pursuant to its terms, (ii) the date that is
sixty (60) days following the Closing and (iii) the date the Company or
any Subsidiary of the Company makes a public announcement, enters into an
agreement or files any pleading or document with the Bankruptcy Court, in each
case, evidencing its decision to support any Competing Transaction, or the
Company or any Subsidiary of the Company enters into a Competing Transaction:

 

(a)           Purchaser shall provide or shall use reasonable best
efforts to cause an appropriate Affiliate to provide, all cooperation and
assistance as may be reasonably requested by the Company in connection with the
Company’s efforts to consummate equity and debt financings for the Company, and
sales of properties and other assets of the Company and its Subsidiaries for
cash (collectively, the “Capital Raising Activities”), including
to:  (A) participate in a reasonable
number of customary meetings (including lender meetings, if any),
presentations, road shows, due diligence and drafting sessions and sessions
with rating agencies, investors or underwriters; (B) assist with the
preparation of materials for rating agency presentations, bank information
memoranda, prospectuses and similar documents necessary in connection with the
Capital Raising Activities; and (C) cooperate with the Company in
connection with applications to 

 

27

 

obtain
such consents, approvals or authorizations which may be reasonably necessary or
desirable in connection with the Capital Raising Activities; provided,
that Purchaser shall not be required to provide cooperation under this
paragraph that:  (w) unreasonably
interferes with the business of Purchaser, its Affiliates, members or partners
or the Affiliates of its members or partners; (x) causes any closing
condition set forth in Article VII to fail to be satisfied or
otherwise causes a breach of this Agreement; (y) violates applicable Law;
or (z) requires Purchaser, its Affiliates, members or partners or the
Affiliates of its members or partners, to pay any fees or incur any liabilities
for which they are not reimbursed when such fees or liabilities are incurred or
adequately indemnified or require Purchaser to expend any financial resources
on behalf of the Company which they are not reimbursed or fully indemnified or
guarantee or otherwise support the extension of credit to the Company; and

 

(b)           the Company shall consult in good faith with
Purchaser regarding the appropriate balance among Capital Raising Activities
with a view toward employing the alternatives that generate the most value for
the Company with the lowest cost of capital and to avoid unnecessary dilution,
and the Company shall also consider in good faith structuring certain asset
sales as sales of minority positions in the relevant assets, thereby enabling
the Company to maintain majority ownership and management of those assets.

 

SECTION 5.4         Listing.  The Company shall use its reasonable best
efforts to cause the Shares and the New Warrants to be listed on the New York
Stock Exchange (the “NYSE”).  The Plan shall provide that the
Company shall use its reasonable best efforts to cause GGO to use its
reasonable best efforts to cause the GGO Shares and the GGO Warrants to be
listed on a U.S. national securities exchange.

 

SECTION 5.5         Use of Proceeds.  The Plan shall provide that the Company and
its Subsidiaries, and GGO, shall apply the net proceeds from the sale of the
Shares and the GGO Shares and the Capital Raising Activities, as applicable, as
provided in the Plan Summary Term Sheet and the Plan.

 

SECTION 5.6         Access to Information.  Subject to applicable Law and the existing
confidentiality agreement between Brookfield Asset Management Inc., an
Affiliate of Purchaser, and the Company, dated February 27, 2010 (the “Confidentiality
Agreement”), upon reasonable notice, the Company shall afford Purchaser and
its directors, officers, employees, investment bankers, attorneys, accountants
and other advisors or representatives, reasonable access during normal business
hours, throughout the period prior to the Effective Date, to its employees,
books, contracts and records and, during such period, the Company shall (and
shall cause its Subsidiaries to) furnish promptly to Purchaser such information
concerning its business, properties and personnel as may reasonably be
requested by Purchaser, including, copies of all monthly financial information
provided to its lenders under its existing debtor-in possession financing
agreements; provided, that, notwithstanding anything to the contrary,
the Company shall not be required to share confidential information relating to
any Competing Transaction except as contemplated by Section 5.7.  Subject to the Confidentiality Agreement, the
Company shall provide, and shall cause its Subsidiaries, and shall use all reasonable
efforts to cause their respective representatives, including legal and
accounting, to provide all cooperation reasonably requested by Purchaser in
connection with the assistance contemplated to be provided by Purchaser in
connection with the Capital Raising Activities contemplated by Section 5.3.

 

28

 

SECTION 5.7         Competing Transactions.  From the date of this Agreement until the
earlier to occur of the Closing and the termination of this Agreement, the
Company shall provide written notice to Purchaser not less than 48 hours prior
to the Company or any Subsidiary of the Company (i) entering into a
definitive agreement providing for a Competing Transaction or (ii) filing
a motion with the Bankruptcy Court seeking to obtain bid procedures or bid
protections for or in connection with a Competing Transaction.

 

SECTION 5.8         Reservation for Issuance.  The Company shall reserve that number of
shares of Common Stock sufficient for issuance upon exercise or conversion of
the Warrants.  In connection with the
issuance of the New Warrants, the Plan shall provide that the Company shall
reserve for issuance that number of shares of New Common Stock sufficient for
issuance upon exercise of the New Warrants. 
The Plan shall provide that GGO shall reserve for issuance that number
of shares of GGO Common Stock sufficient for issuance upon exercise of the GGO
Warrants.

 

SECTION 5.9         Subscription Rights.

 

(a)           Company Subscription Right.

 

(i)            Sale of
New Equity Securities.  Following
the Closing Date, Purchaser shall have the right, or shall at any time and from
time to time thereafter have the right to appoint Brookfield Consortium Members
in accordance with and subject to the Designation Conditions, to exercise the
Subscription Right set forth in this Section 5.9 (Purchaser or one
or more Brookfield Consortium Members, each a “Subscribing Entity” and
collectively the “Subscribing Entities”).  If the Company or any Subsidiary of the
Company at any time or from time to time following the Closing Date makes any
public or non-public offering of any shares of New Common Stock (or securities
that are convertible into or exchangeable or exercisable for, or linked to the
performance of, New Common Stock) (other than (1) pursuant to the granting
or exercise of employee stock options or other stock incentives pursuant to the
Company’s stock incentive plans and employment arrangements as in effect from
time to time or the issuance of stock pursuant to the Company’s employee stock
purchase plan as in effect from time to time, (2) pursuant to or in
consideration for the acquisition of another Person, business or assets by the
Company or any of its Subsidiaries, whether by purchase of stock, merger,
consolidation, purchase of all or substantially all of the assets of such
Person or otherwise, (3) to strategic partners or joint venturers in
connection with a commercial relationship with the Company or its Subsidiaries
or to parties in connection with such Persons providing the Company or its
Subsidiaries with loans, credit lines, cash price reductions or similar
transactions, under arm’s-length arrangements, (4) pursuant to the Equity
Exchange or any conversion or exchange of debt or other claims into equity in
connection with the Plan, (5) the sale of Backstop Shares (as defined in
the Pershing Agreement) pursuant to the Pershing Agreement or (6) as set
forth on Section 5.9(a) of the Company Disclosure Letter) (the “Proposed
Securities”), the Subscribing Entities shall have the right to acquire from
the Company (the “Subscription Right”) for the same price (net of any
underwriting discounts or sales commissions or any other discounts or fees if
not purchasing from or through an underwriter, placement agent or broker) and
on the same terms as such Proposed Securities are proposed to be offered to
others, up to the 

 

29

 

amount of such Proposed Securities in the aggregate
required to enable it to maintain its proportionate New Common Stock-equivalent
interest in the Company on a Fully Diluted Basis determined in accordance with
the following sentence, in each case, subject to such limitations as may be
imposed by applicable Law or stock exchange rules.  The amount of such Proposed Securities that
the Subscribing Entities shall be entitled to purchase in the aggregate in any
offering pursuant to the above shall (subject to such limitations as may be
imposed by applicable Law or stock exchange rules) be determined by multiplying
(x) the total number of such offered shares of Proposed Securities by (y) a
fraction, the numerator of which is the number of shares of New Common Stock
held by Purchaser and Brookfield Consortium Members on a Fully Diluted Basis as
of the date of the Company’s notice pursuant to Section 5.9(a)(ii) in
respect of the  issuance of such Proposed Securities, and the denominator
of which is the number of shares of New Common Stock then outstanding on a
Fully Diluted Basis.  For the avoidance
of doubt, the actual amount of securities to be sold or offered to the
Subscribing Entities pursuant to its exercise of the Subscription Right
hereunder shall be proportionally reduced if the aggregate amount of Proposed
Securities sold or offered is reduced. 
Any offers and sales pursuant to this Section 5.9 in the
context of a registered public offering shall be conditioned upon reasonably
acceptable representations and warranties of each Subscribing Entity regarding
its status as the type of offeree to whom a private sale can be made
concurrently with a registered public offering in compliance with applicable
securities Laws.

 

(ii)           Notice.  In the event the Company proposes to offer
Proposed Securities, it shall give Purchaser written notice of its intention,
describing the estimated price (or range of prices), anticipated amount of
securities, timing and other terms upon which the Company proposes to offer the
same (including, in the case of a registered public offering and to the extent
possible, a copy of the prospectus included in the registration statement filed
with respect to such offering), no later than ten Business Days after the
commencement of marketing with respect to such offering or after the Company
takes substantial steps to pursue any other offering.  The Subscribing Entity shall have three
Business Days from the date of receipt of such a notice to notify the Company
in writing that it intends to exercise its Subscription Right and as to the
amount of Proposed Securities the Subscribing Entity desires to purchase, up to
the maximum amount calculated pursuant to Section 5.9(a)(i).  In connection with an underwritten public
offering, such notice shall constitute a non-binding indication of interest to
purchase Proposed Securities at such a range of prices as the Subscribing
Entity may specify and, with respect to other offerings, such notice shall
constitute a binding commitment of the 
Subscribing Entity to purchase the amount of Proposed Securities so
specified at the price and other terms set forth in the Company’s notice to
such Subscribing Entity.  The failure of
the Subscribing Entity to so respond within such three Business Day period
shall be deemed to be a waiver of the Subscription Right under this Section 5.9
only with respect to the offering described in the applicable notice.  In connection with an underwritten public
offering or a private placement, the Subscribing Entity shall further enter
into an agreement (in form and substance customary for transactions of this
type) to purchase the Proposed Securities to be acquired contemporaneously with
the execution of any underwriting agreement or purchase agreement entered into
with the Company, the underwriters or initial purchasers of such underwritten
public offering or private 

 

30

 

placement, and the failure to enter into such an
agreement at or prior to such time shall constitute a waiver of the
Subscription Right in respect of such offering.

 

(iii)          Purchase
Mechanism.  If the
Subscribing Entity exercises its Subscription Right provided in this Section 5.9,
the closing of the purchase of the Proposed Securities with respect to which
such right has been exercised shall take place concurrently with the sale to
the other investors in the applicable offering, which period of time for the
closing of the purchase of the Proposed Securities with respect to which such
right has been exercised shall be extended for a maximum of 180 days in order
to comply with applicable Laws (including receipt of any applicable regulatory
or stockholder approvals).  Each of the
Company and the Subscribing Entity shall use its reasonable best efforts to
secure any regulatory or stockholder approvals or other consents, and to comply
with any Law necessary in connection with the offer, sale and purchase of, such
Proposed Securities.

 

(iv)          Failure of
Purchase.  In the
event (A) the Subscribing Entity fails to exercise its Subscription Right
provided in this Section 5.9 within said three Business Day period
or, (B) if so exercised, the Subscribing Entity fails or is unable to
consummate such purchase within the 180 day period specified in Section 5.9(a)(iii),
without prejudice to other remedies, the Company shall thereafter be entitled
during the Additional Sale Period to sell the Proposed Securities not elected
to be purchased pursuant to this Section 5.9 or which the
Subscribing Entity fails to, or is unable to, purchase, at a price and upon
terms no more favorable in any material respect to the purchasers of such
securities than were specified in the Company’s notice to Purchaser.  In the event the Company has not sold the
Proposed Securities within the Additional Sale Period, the Company shall not
thereafter offer, issue or sell such Proposed Securities without first offering
such securities to Purchaser in the manner provided above.

 

(v)           Non-Cash
Consideration.  In the case
of the offering of securities for a consideration in whole or in part other
than cash, including securities acquired in exchange therefor (other than
securities by their terms so exchangeable), the consideration other than cash
shall be deemed to be the fair value thereof as determined by the Company
Board; provided, however, that such fair value as determined by
the Company Board shall not exceed the aggregate market price of the securities
being offered as of the date the Company Board authorizes the offering of such
securities.

 

(vi)          Cooperation.  The Company and Purchaser shall cooperate in
good faith to facilitate the exercise of the Subscribing Entity’s Subscription
Right hereunder, including using reasonable efforts to secure any required
approvals or consents.

 

(vii)         General.  Notwithstanding anything herein to the
contrary, (A) if (1) the Subscribing Entity exercises its
Subscription Right pursuant to this Section 5.9 and is unable to
complete the purchase of the Proposed Securities concurrently with the sales to
the other investors in the applicable offering as contemplated by Section 5.9(a)(iii) due
to applicable regulatory or stockholder approvals and (2) the Company or
the Company Board determines in good faith that any delay in completion of an
offering in respect of which the Brookfield Consortium Members are entitled to
Subscription Rights would 

 

31

 

materially impair the financing objective of such
offering,  the Company may proceed with
such offering without the participation of Purchaser in such offering, in which
event the Company and Purchaser shall promptly thereafter agree on a process otherwise
consistent with this Section 5.9 as would allow Purchaser to
purchase, at the same price (net of any underwriting discounts or sales
commissions or any other discounts or fees if not purchasing from or through an
underwriter, placement agent or broker) as in such offering, up to the amount
of shares of New Common Stock (or securities that are convertible into or
exchangeable or exercisable for, or linked to the performance of, New Common
Stock) as shall be necessary to enable Purchaser to maintain its proportionate
New Common Stock-equivalent interest in the Company on a Fully Diluted Basis,
(B) if the Company or the Company Board determines in good faith that
compliance with the notice provisions in Section 5.9(a)(ii) would
materially impair the financing objective of 
an offering in respect of which the Brookfield Consortium Members are
entitled to Subscription Rights, the Company shall be permitted by notice to
the Subscribing Entity to reduce the notice period required under Section 5.9(a)(ii) (but
not to less than one (1) Business Day) to the minimum extent required to
meet the financing objective of such offering, and the Subscribing Entity shall
have the right to either (x) exercise its Subscription Rights during the
shortened notice periods specified in such notice or (y) require the
Company to promptly thereafter agree on a process otherwise consistent with
this Section 5.9 as would allow Purchaser to purchase, at the same
price (net of any underwriting discounts or sales commissions or any other
discounts or fees if not purchasing from or through an underwriter, placement
agent or broker) as in such offering, up to the amount of shares of New Common
Stock (or securities that are convertible into or exchangeable or exercisable
for, or linked to the performance of, New Common Stock) as shall be necessary
to enable Purchaser to maintain its proportionate New Common Stock-equivalent
interest in the Company on a Fully Diluted Basis and (C) in the event the
Company is unable to issue shares of New Common Stock (or securities that are
convertible into or exchangeable or exercisable for, or linked to the
performance of, New Common Stock) to Purchaser as a result of a failure to
receive regulatory or stockholder approval therefor, the Company shall take
such action or cause to be taken such other action in order to place the
Subscribing Entity, in so far as reasonably practicable (subject to any
limitations that may be imposed by applicable Law or stock exchange rules), in
the same position in all material respects as if the Subscribing Entity was
able to effectively exercise its Subscription Rights hereunder, including, at
the option of the Subscribing Entity, issuing to the Subscribing Entity another
class of securities of the Company having terms to be agreed by the Company and
Purchaser having a value at least equal to the value per share of New Common
Stock, in each case, as shall be necessary to enable Purchaser to maintain its
proportionate New Common Stock-equivalent interest in the Company on a Fully
Diluted Basis.

 

(viii)        Termination.  This Section 5.9 shall terminate
at such time as Purchaser together with the Brookfield Consortium Members
collectively beneficially own less than 5% of the outstanding shares of New
Common Stock on a Fully Diluted Basis.

 

(b)           GGO Subscription Rights.  The Plan shall provide that in connection
with the consummation of the Plan, GGO shall enter into an agreement with
Purchaser with substantially similar terms to those set forth in Section 5.9(a) above
with respect to any issuance of GGO 

 

32

 

Common
Stock (or securities that are convertible into or exchangeable or exercisable
for, or otherwise linked to, GGO Common Stock) after
the Effective Date.

 

SECTION 5.10       Company Board of Directors.

 

(a)           Company Board of Directors.

 

(i)            The Plan shall provide that
as of the Effective Date, the Company Board shall have nine (9) members
and three (3) of such members shall be persons designated by Purchaser
(the “Purchaser Board Designees”), one to each class of directors of the
Company Board (if the Company has a staggered board of directors); provided,
that such designees shall be identified by name and in writing to the Company
no later than 10 Business Days prior to the voting deadline established by the
Bankruptcy Court.  Subject to the rights
provided under the Fairholme/Pershing Agreements, the remaining members of the
Company Board on the Effective Date shall be chosen by the Company in
consultation with Purchaser.

 

(ii)           Following the Closing, the
Company shall nominate as part of its slate of directors and use its reasonable
best efforts to have elected to the Company Board (including through the
solicitation of proxies for such person to the same extent as it does for any
of its other nominees to the Company Board) (subject to applicable Law and
stock exchange rules (provided that Purchaser Board Designees need not be
“independent” under the applicable rules of the applicable stock exchange
or the SEC)) (x) so long as Purchaser and the Brookfield Consortium
Members beneficially own (directly or indirectly) in the aggregate at least 20%
of the shares of New Common Stock on a Fully Diluted Basis, three (3) Purchaser
Board Designees, (y) so long as Purchaser and the Brookfield Consortium
Members beneficially own (directly or indirectly) in the aggregate at least
15%, but less than 20%, of the shares of New Common Stock on a Fully Diluted
Basis, two (2) Purchaser Board Designees, and (z) so long as
Purchaser and the Brookfield Consortium Members beneficially own (directly or indirectly)
in the aggregate at least 10%, but less than 15%, of the shares of Common Stock
on a Fully Diluted Basis, one (1) Purchaser Board Designee.  For the avoidance of doubt, at and following
such time as Purchaser and the Brookfield Consortium Members beneficially own
(directly or indirectly) in the aggregate less than 10% of the shares of Common
Stock on a Fully Diluted Basis, Purchaser and the Brookfield Consortium Members
shall no longer have the right to designate directors for election to the Company
Board.  Following the Closing, and
subject to applicable Law and stock exchange rules, there shall be proportional
representation by Purchaser Board Designees on any committee of the Company
Board, except for special committees established for potential conflict of
interest situations involving any 
Brookfield Consortium Member or any Affiliate thereof, and except that
only Purchaser Board Designees who qualify under the applicable rules of
the applicable stock exchange or the SEC may serve on committees where such
qualification is required.  If at any
time the number of Purchaser Board Designees serving on the Company Board
exceeds the number of Purchaser Board Designees that Purchaser is then
otherwise entitled to designate as a result of a decrease in the percentage of
shares of New Common Stock beneficially owned by Purchaser and the Brookfield
Consortium Members,  Purchaser shall, to
the extent it is within Purchaser’s control, use its 

 

33

 

commercially reasonable efforts to cause any such
additional Purchaser Board Designees to offer to resign such that the number of
Purchaser Board Designees serving on the Company Board after giving effect to
such resignation does not exceed the number of Purchaser Board Designees that
Purchaser is entitled to designate for election to the Company Board.

 

(iii)          Except with respect to the
resignation of a Purchaser Board Designee pursuant to Section 5.10(a)(ii),
Purchaser shall have the power to designate a Purchaser Board Designee’s
replacement upon the death, resignation, retirement, disqualification or
removal from office of such Purchaser Board Designee.  The Company Board shall promptly take all
action reasonably required to fill any vacancy resulting therefrom with such
replacement Purchaser Board Designee (including nominating such person, subject
to applicable Law, as the Company’s nominee to serve on the Company Board and
causing the Company to use all reasonable efforts to have such person elected
as a director of the Company and solicit proxies for such person to the same
extent as it does for any of the Company’s other nominees to the Company
Board).

 

(iv)          The Purchaser Board
Designees shall be entitled to the same compensation and same indemnification
in connection with his or her role as a director as the members of the Company
Board, and each Purchaser Board Designee shall be entitled to reimbursement for
documented, reasonable out-of-pocket expenses incurred in attending meetings of
the Company Board or any committees thereof, to the same extent as other
members of the Company Board.  The
Company shall notify each Purchaser Board Designee of all regular and special
meetings of the Company Board and shall notify each Purchaser Board Designee of
all regular and special meetings of any committee of the Company Board of which
such Purchaser Board Designee is a member. 
The Company shall provide each Purchaser Board Designee with copies of
all notices, minutes, consents and other materials provided to all other members
of the Company Board concurrently as such materials are provided to the other
members (except, for the avoidance of doubt, as are provided to members of
committees of which such Purchaser Board Designee is not a member).

 

(v)           Purchaser Board Designees
candidates shall be subject to such reasonable eligibility criteria as are
applied in good faith by the nominating, corporate governance or similar
committee of the Company Board to other candidates for the Company Board.  Purchaser shall designate one of the
Purchaser Board Designees to serve as the initial chairman of the Company Board
as of the Effective Date.

 

(b)           GGO Board of
Directors.

 

(i)            The Plan shall
provide that as of the Effective Date, the board of directors of
GGO (the “GGO Board”) shall have nine (9) members and one (1) of
such members shall be persons designated by Purchaser (the “Purchaser GGO
Board Designee”); provided, that such designee shall be identified
by name and in writing to the Company no later than 10 Business Days prior to the
voting deadline established by the Bankruptcy Court.  Subject to the rights provided under the
Fairholme/Pershing Agreements, the remaining members of the GGO Board on the
Effective Date shall be chosen by the Company in consultation with Purchaser.

 

34

 

(ii)           The
Plan shall provide, in
connection with the consummation of the Plan, for GGO to enter into an
agreement with Purchaser (the “GGO Agreement”) providing as follows:

 

(1)           That following the
Closing, GGO shall nominate one (1) 
Purchaser GGO Board Designee as part of its slate of directors and use its
reasonable best efforts to have him or her elected to the GGO Board (including
through the solicitation of proxies for such person to the same extent as it
does for any of its other nominees to the GGO Board) (subject to applicable Law
and stock exchange rules (provided that the Purchaser GGO Board Designee
need not be “independent” under the applicable rules of the applicable
stock exchange or the SEC)) so long
as Purchaser and the Brookfield Consortium Members beneficially own (directly or indirectly) in the aggregate at least 10% of the
shares of GGO Common Stock on a Fully Diluted Basis.  For the avoidance of doubt, at and following
such time as Purchaser and the Brookfield Consortium Members beneficially own
(directly or indirectly) in the aggregate less than 10% of the shares of GGO
Common Stock on a Fully Diluted Basis, Purchaser and the Brookfield Consortium
Members shall no longer have the right to designate any director for election
to the GGO Board.

 

(2)           That following the Closing, and subject to
applicable Law and stock exchange rules, there shall be proportional
representation by the Purchaser GGO Board Designee on any committee of the GGO
Board, except for special committees established for potential conflict of
interest situations involving any 
Brookfield Consortium Member or any Affiliate thereof, and except that
the Purchaser GGO Board Designee may serve on committees where qualification
under the applicable rules of the applicable stock exchange or the SEC are
required only if the Purchaser GGO Board Designee so qualifies.  If at any time Purchaser is no longer
entitled to designate the Purchaser GGO Board Designee as a result of a
decrease in the percentage of shares of GGO Common Stock beneficially owned by
Purchaser and the Brookfield Consortium Members, Purchaser shall, to the extent
it is within Purchaser’s control, use commercially reasonable efforts to cause
any such Purchaser GGO Board Designee to offer to resign.

 

(3)           That except with respect to the resignation of the
Purchaser GGO Board Designee pursuant to Section 5.10(b)(ii)(2),
(A) Purchaser shall have the power to designate the Purchaser GGO Board
Designee’s replacement upon the death, resignation, retirement,
disqualification or removal from office of such Purchaser GGO Board Designee
and (B) the GGO Board shall promptly
take all action reasonably required to fill any vacancy resulting therefrom
with such replacement Purchaser GGO Board Designee (including nominating such
person, subject to applicable Law, as GGO’s nominee to serve on the GGO Board and causing GGO to use all reasonable efforts to
have such person elected as a director of GGO and 

 

35

 

solicit proxies for such person to the same extent
as it does for any of GGO’s other nominees to the GGO
Board).

 

(4)           That (A) the Purchaser GGO Board Designee shall
be entitled to the same compensation and same indemnification in connection
with his or her role as a director as the members of the GGO Board, and the Purchaser GGO Board Designee shall be
entitled to reimbursement for documented, reasonable out-of-pocket expenses
incurred in attending meetings of the GGO
Board or any committees thereof, to the same extent as other members of the GGO Board, (B) GGO shall notify the Purchaser
GGO Board Designee of all regular and special meetings of the GGO Board and shall notify the Purchaser GGO Board Designee
of all regular and special meetings of any committee of the GGO Board of which the Purchaser GGO Board Designee is a
member, and (C) GGO shall provide the Purchaser GGO Board Designee with
copies of all notices, minutes, consents and other materials provided to all
other members of the GGO Board concurrently
as such materials are provided to the other members (except, for the avoidance
of doubt, as are provided to members of committees of which the Purchaser GGO
Board Designee is not a member).

 

(5)           Purchaser GGO Board Designee candidates shall be
subject to such reasonable eligibility criteria as applied in good faith by the
nominating, corporate governance or similar committee of the GGO Board to other
candidates for the GGO Board.

 

SECTION 5.11       Notification of Certain Matters.

 

(a)           The Company shall (i) give prompt written
notice to Purchaser of any written notice or other written communication from
any Person alleging that the consent of such Person which is or may be required
in connection with the transactions contemplated by this Agreement is not
likely to be obtained prior to Closing, if the failure to obtain such consent
would reasonably be expected to be adverse and material to the Company and its
Subsidiaries taken as a whole or would materially impair the ability of the
Company to consummate the transactions contemplated hereby or perform its
obligations hereunder, and (ii) facilitate adding such individuals as
designated by Purchaser to the electronic notification system such that the
designated individuals will receive electronic notice of the entry of any
Bankruptcy Court Order.

 

(b)           To the extent permitted by applicable Law, (i) the
Company shall give prompt notice to Purchaser of the commencement of any
investigation, inquiry or review by any Governmental Entity with respect to the
Company or its Subsidiaries which would reasonably be expected to be adverse
and material to the Company and its Subsidiaries taken as a whole or would
materially impair the ability of the Company to consummate the transactions
contemplated hereby or perform its obligations hereunder, and (ii) the
Company shall give prompt notice to Purchaser, and Purchaser shall give written
prompt notice to the Company, of any event or circumstance that would result in
any representation or warranty of the Company or Purchaser, as applicable,
being untrue or any covenant or agreement of the Company or 

 

36

 

Purchaser,
as applicable, not being performed or complied with such that, in each such
case, the conditions set forth in Article VII or Article VIII,
as applicable, would not be satisfied if such event or circumstance existed on
the Closing Date.

 

(c)           No information received by a party pursuant to this Section 5.11
nor any information received or learned by a party or any of its
representatives pursuant to an investigation made under this Section 5.11
shall be deemed to (A) qualify, modify, amend or otherwise affect any
representations, warranties, conditions, covenants or other agreements of the
other party set forth in this Agreement, (B) amend or otherwise supplement
the information set forth in the Company Disclosure Letter, (C) limit or
restrict the remedies available to such party 
under this Agreement, applicable Law or otherwise arising out of a
breach of this Agreement, or (D) limit or restrict the ability of such
party to invoke or rely on, or effect the satisfaction of, the conditions to
the obligations of such party to consummate the transactions contemplated by
this Agreement set forth in Article VII or Article VIII,
as applicable.

 

SECTION 5.12       Further Assurances.  From and after the Closing, the Company shall
(and shall cause each of its Subsidiaries to) execute and deliver, or cause to
be executed and delivered, such further instruments or documents or take such
other action and cause entities controlled by them to take such action as may
be reasonably necessary (or as reasonably requested by Purchaser) to carry out
the transactions contemplated by this Agreement.

 

SECTION 5.13       [Intentionally Omitted.]

 

SECTION 5.14       Rights Agreement; Reorganized Company Organizational
Documents.

 

(a)           Prior to the issuance of the Warrants, the Rights
Agreement shall be amended to provide that (i) the Rights Agreement is
inapplicable to (1) the acquisition by Purchaser of the Warrants and the
underlying securities thereof, (2) any antidilution adjustments to those
Warrants pursuant to the Warrant Agreement, (3) any shares of New Common
Stock that Purchaser or any Brookfield Consortium Member may be deemed to own
by no actions of its own and (4) up to an additional 2.5% of the issued
and outstanding shares of Common Stock by Brookfield Consortium Members, (ii) neither
Purchaser, nor any Brookfield Consortium Member, shall be deemed to be an
Acquiring Person (as defined in the Rights Agreement), (iii) neither a
Shares Acquisition Date (as defined in the Rights Agreement) nor a Distribution
Date (as defined in the Rights Agreement) shall be deemed to occur and (iv) the
Rights (as defined in the Rights Agreement) shall not separate from the Common
Stock, in each case under (ii), (iii) and (iv), as a result of the
acquisition by Purchaser of the Warrants, the underlying securities thereof and
the acquisition of beneficial ownership of up to an additional 2.5% of the
issued and outstanding shares of Common Stock by Brookfield Consortium Members.

 

(b)           The certificate of incorporation and bylaws of the
Reorganized Company (the “Reorganized Company Organizational Documents”)
shall be in form mutually agreed to by the Company and Purchaser, provided,
that in the event that the Company and Purchaser are not able to agree on such
form prior to the Effective Date, the Reorganized Company Organizational
Documents shall be substantially in the same form as the certificate of
incorporation and bylaws of the Company as in existence on the date of this
Agreement (except that the number of authorized shares of capital stock of the
Reorganized Company shall be increased), provided, 

 

37

 

however,
that (i) the restriction on Beneficial Ownership (as such term is defined
in the certificate of incorporation of the Company) shall be set at 9.9% of the
outstanding capital stock of the Reorganized Company, (ii) the restriction
on Constructive Ownership (as such term is defined in the certificate of
incorporation of the Company) shall be set at 9.9% of the outstanding capital
stock of the Reorganized Company, (iii) there shall not be an exemption
from the restrictions set forth in the foregoing clauses (i) and (ii) for
the current Existing Holder (as such term is defined in the existing
certificate of incorporation of the Company), (iv) the Reorganized Company
shall provide a waiver from the restrictions set forth in the foregoing clauses
(i) and (ii) to any Brookfield Consortium Member if such Brookfield
Consortium Member provides the Reorganized Company with a certificate
containing the representations and covenants set forth on Exhibit D
and (v) the definition of “Person” shall be revised so that it does not
include a “group” as that term is used for purposes of Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended.

 

(c)           In the event the Reorganized Company adopts a rights
plan analogous to the Rights Agreement on or prior to the Closing, the Plan
shall provide that (i) the Reorganized Company’s Rights Agreement shall be
inapplicable to this Agreement and the transactions contemplated hereby, (ii) neither
Purchaser, nor any Brookfield Consortium Member, shall be deemed to be an
Acquiring Person (as defined in the Rights Agreement) whether in connection
with the acquisition of Shares, New Warrants, shares issuable upon exercise of
the New Warrants or otherwise, (iii) neither a Shares Acquisition Date (as
defined in the Rights Agreement) nor a Distribution Date (as defined in the
Rights Agreement) shall be deemed to occur and (iv) the Rights (as defined
in the Rights Agreement) will not separate from the New Common Stock, in each
case under (ii), (iii) and (iv), as a result of the execution, delivery or
performance of this Agreement, the consummation of the transactions
contemplated hereby including the acquisition of shares of New Common Stock by
Purchaser and any Brookfield Consortium Member after the date hereof as
otherwise permitted by this Agreement, the New Warrants or as otherwise
contemplated by the Non-Control Agreement.

 

(d)           In the event GGO adopts a rights plan analogous to
the Rights Agreement on or prior to the Closing, the Plan shall provide that
(i) GGO’s Rights Agreement shall be inapplicable to this Agreement and the
transactions contemplated hereby, (ii) neither Purchaser, nor any
Brookfield Consortium Member, shall be deemed to be an Acquiring Person (as
defined in the Rights Agreement) whether in connection with the acquisition of
shares of GGO Common Stock or GGO Warrants or the shares issuable upon exercise
of the GGO Warrants, (iii) neither a Shares Acquisition Date (as defined
in the Rights Agreement) nor a Distribution Date (as defined in the Rights
Agreement) shall be deemed to occur and (iv) the Rights (as defined in the
Rights Agreement) will not separate from the GGO Common Stock, in each case
under (ii), (iii) and (iv), as a result of the execution, delivery or
performance of this Agreement or the consummation of the transactions contemplated
hereby including the acquisition of shares of GGO Common Stock by Purchaser and
any Brookfield Consortium Member after the date hereof as otherwise permitted
by this Agreement, or the GGO Warrants.

 

(e)           Newco (as defined in Exhibit B) will be
formed by the Operating Partnership solely for the purpose of engaging in the
transactions contemplated by this Agreement, including Exhibit B  and Capital Raising Activities permitted
pursuant to this Agreement.  Prior to the
Closing, Newco will not engage in any business activity, nor conduct its
operations, other than as 

 

38

 

contemplated
by this Agreement (which, for greater certainty, shall include Capital Raising
Activities permitted pursuant to this Agreement).

 

SECTION 5.15       Stockholder Approval.  For so long as Purchaser has Subscription
Rights as contemplated by Section 5.9(a), in connection with the
expiration of the five (5) year period referenced in Section 3.2(c),
the Company shall put up for a stockholder vote at the immediately prior annual
meeting of its stockholders, and include in its proxy statement distributed to
such stockholders in connection with such annual meeting, approval of
Purchaser’s Subscription Rights for the maximum period permitted by the
NYSE.  The Plan shall provide that GGO
shall, for the benefit of Purchaser, to the extent required by any U.S.
national securities exchange upon which shares of GGO Common Stock are listed,
for so long as Purchaser has subscription rights as contemplated by Section 5.9(b),
put up for a stockholder vote at the annual meeting of its stockholders, and
include in its proxy statement distributed to such stockholders in connection
with such annual meeting, approval of Purchaser’s subscription rights for the
maximum period permitted by the rules of such U.S. national securities
exchange.

 

SECTION 5.16       Registration Statements.

 

(a)           Prior to or promptly following the Effective Date,
the Company shall file with the SEC a shelf registration statement on Form S-1
or Form S-11, as applicable, covering the resale by Purchaser of the
Shares and the shares of New Common Stock issuable upon exercise of the New
Warrants, containing a plan of distribution reasonably satisfactory to
Purchaser, and the Company shall use its reasonable best efforts to cause such
registration statement to be declared effective by the SEC no later than 180
days after the Effective Date. 
Notwithstanding the foregoing, in the event that the Company files a
registration statement covering the resale of shares of New Common Stock for
any Other Sponsor prior to such date, the Company shall include the Shares and
shares of New Common Stock issuable upon exercise of the New Warrants for
resale by Purchaser in such registration statement.

 

(b)           The Plan shall provide that, prior to or promptly
following the Effective Date, GGO shall file with the SEC a shelf registration
statement on Form S-1 or Form S-11, as applicable, covering the
resale by Purchaser of the GGO Shares and the shares of GGO Common Stock
issuable upon exercise of the GGO Warrants, containing a plan of distribution
reasonably satisfactory to Purchaser, and GGO shall use its reasonable best
efforts to cause such registration statement to be declared effective by the
SEC no later than 180 days after the Effective Date.  Notwithstanding the foregoing, in the event
that GGO files a registration statement covering the resale of shares of GGO
Common Stock for any Other Sponsor prior to such date, GGO shall include the
GGO Shares and shares of GGO Common Stock issuable upon exercise of the GGO
Warrants for resale by Purchaser in such registration statement.

 

SECTION 5.17       Closing Date Net Debt.

 

(a)           The Company shall deliver to Purchaser a schedule
(the “Preliminary Closing Date Net Debt Schedule”) on or before the
first Business Day that is five calendar days following approval of the
Disclosure Statement, that:  (i) sets
forth the Company’s good faith estimate for each of the three components of the
Closing Date Net Debt W/O Reinstatement Adjustment and Permitted Claims Amounts
along with a reasonably detailed explanation and calculation of each 

 

39

 

such
component and (ii) discloses the Company’s good faith estimate of the
Closing Date Net Debt W/O Reinstatement Adjustment and Permitted Claims Amounts
and GGO Setup Costs.

 

(b)           Purchaser shall review the Preliminary Closing Date
Net Debt Schedule during the Preliminary Closing Date Net Debt Review Period,
during which time the Company shall allow Purchaser reasonable access to all
non-privileged and non-work product documents or records or personnel used in
the preparation of the Preliminary Closing Date Net Debt Schedule.  On or prior to the Preliminary Closing Date
Net Debt Review Deadline, Purchaser may deliver to the Company a notice (the “Dispute
Notice”) listing those items on the Preliminary Closing Date Net Debt
Schedule to which Purchaser takes exception, which Dispute Notice shall (i) specifically
identify such items, and provide a reasonably detailed explanation of the basis
upon which Purchaser has delivered such list, (ii) set forth the amount of
Closing Date Net Debt W/O Reinstatement Adjustment and Permitted Claims Amounts
that Purchaser has calculated based on the information contained in the
Preliminary Closing Date Net Debt Schedule, and (iii) specifically
identify Purchaser’s proposed adjustment(s). 
If Purchaser timely provides the Company with a Dispute Notice, then
Purchaser and the Company shall, within ten (10) days following receipt of
such Dispute Notice by the Company (the “Resolution Period”), attempt to
resolve their differences with respect to the items specified in the Dispute
Notice (the “Disputed Items”).  If
Purchaser and the Company do not resolve all Disputed Items by the end of the
Resolution Period, then all Disputed Items remaining in dispute shall be
submitted to the Bankruptcy Court for resolution at or concurrent with the
Confirmation Hearing.  The Bankruptcy
Court shall consider only those Disputed Items that Purchaser, on the one hand,
and the Company, on the other hand, were unable to resolve.  All other matters shall be deemed to have
been agreed upon by Purchaser and the Company. 
If Purchaser does not timely deliver a 
Dispute Notice, then Purchaser shall be deemed to have accepted and
agreed to the Preliminary Closing Date Net Debt Schedule and to have waived any
right to dispute the matters set forth therein.

 

(c)           The Company shall deliver to Purchaser a draft of
the Conclusive Net Debt Adjustment Statement no later than 15 calendar days
prior to the Effective Date.  Purchaser
shall be afforded an opportunity to review the Conclusive Net Debt Adjustment
Statement and reasonable access to all non-privileged and non-work product
documents or records or personnel used in the preparation of such
statement.  On or prior to close of
business on the 7th calendar day following receipt of the Conclusive Net Debt
Adjustment Statement, Purchaser may deliver to the Company a notice (the “CNDAS
Dispute Notice”) listing those items to which Purchaser takes exception,
which CNDAS Dispute Notice shall (i) specifically identify such items, and
provide a reasonably detailed explanation of the basis upon which Purchaser has
delivered such list, (ii) set forth the alternative amounts that Purchaser
has calculated based on the information contained in the Conclusive Net Debt
Adjustment Statement, and (iii) specifically identify Purchaser’s proposed
adjustment(s).  If Purchaser timely
provides the Company with a CNDAS Dispute Notice, then Purchaser and the
Company shall attempt to resolve the items specified in the CNDAS Dispute
Notice (the “CNDAS Disputed Items”) consensually.  If Purchaser and the Company do not resolve
all CNDAS Disputed Items prior to the Effective Date, then for purposes of
Closing and subject to subsequent adjustment consistent with the Bankruptcy
Court’s ruling, the highest number shall be used for purposes of any
calculations set forth on the Conclusive Net Debt Adjustment Statement.  Within 10 days after Closing, the Company
shall file a motion for resolution by the Bankruptcy Court.  Purchaser and the Company agree to seek 

 

40

 

expedited
consideration of any such dispute.  The
dispute submitted to the Bankruptcy Court shall be limited to only those CNDAS
Disputed Items that Purchaser, on the one hand, and the Company, on the other
hand, were unable to resolve.  All other
matters shall be deemed to have been agreed upon by Purchaser and the
Company.  If Purchaser does not timely
deliver a  CNDAS Dispute Notice, then
Purchaser shall be deemed to have accepted and agreed to the Conclusive Net
Debt Adjustment Statement and to have waived any right to dispute the matters
set forth therein.  To the extent that
one or more CNDAS Disputed Items must be submitted to the Bankruptcy Court for
adjudication, Purchaser and the Company agree that this should not delay the
Effective Date or the Closing Date. 
Following adjudication of the dispute, appropriate adjustments shall be
made to the Conclusive Net Debt Adjustment Statement, the GGO Promissory Note
and the other applicable documentation to put all parties in the same economic
position as if the corrected Conclusive Net Debt Adjustment Statement governed
at Closing.

 

(d)           It is the intention of the parties that any Reserve
should not alter the intended allocation of value between GGO and the Company
as Claims are resolved over time. 
Accordingly, the Plan shall provide that, if a GGO Promissory Note is
required to be issued at Closing and there is a Reserve Surplus Amount as of
the end of any fiscal quarter prior to the maturity of the GGO Promissory Note,
then the principal amount of the GGO Promissory Note shall be reduced, but not
below zero, by (i) if and to the extent that such Reserve Surplus Amount
as of such date is less than or equal to the Net Debt Surplus Amount, 80% of
the Reserve Surplus Amount, and otherwise (ii) 100% of an amount equal to
the Reserve Surplus Amount; provided, however, that because this calculation
may be undertaken on a periodic basis, for purposes of clauses (i) and
(ii), no portion of the Reserve Surplus Amount shall be utilized to reduce the
amount of the GGO Promissory Note if it has been previously utilized for such
purpose.  In the event that any party
requests an equitable adjustment to this formula, the other parties shall
consider the request in good faith.

 

(e)           The Plan shall provide that, if there is an Offering
Premium, the principal amount of the GGO Promissory Note shall be reduced (but
not below zero) by 80% of the aggregate Offering Premium on the 30th day
following the Effective Date and from time to time thereafter upon receipt of
Offering Premium until the last to occur of (x) 45
days after the Effective Date, (y) the Settlement Date (as defined in the
Pershing Agreement), if applicable, and (z) the Bridge Note Maturity Date
(as defined in the Pershing Agreement).

 

(f)            The Plan and the agreements relating to the GGO
Share Distribution shall provide that from and after the Closing, the Company
shall indemnify GGO and its Subsidiaries from and against 93.75% of any and all
losses, claims, damages, liabilities and reasonable expenses to which GGO and its
Subsidiaries may become subject, in each case solely to the extent directly
attributable to MPC Taxes actually paid at or after the Effective Date; provided,
that in no event shall the Company be required to make any indemnification
payment hereunder to the extent such payment would result in aggregate payments
under this Section 5.17(f) that would exceed the lower of (i) $303,750,000
and (ii) the then effective Excess Surplus Amount (the “Indemnity Cap”).  The Plan shall provide that if GGO or its
Affiliates receives any refund or realizes any reduction of its Tax liability
in respect of the MPC Assets for which it has received a payment or realized a
benefit pursuant to this Agreement, GGO shall pay an amount equal to such
refund or reduction in Tax liability (less any costs or Taxes incurred with
respect to the receipt thereof) to the Reorganized Company within ten (10) Business
Days of the receipt or realization thereof.

 

41

 

(g)           If GGO is obligated to pay MPC Taxes with respect to
the tax year 2010 and the Company is not then obligated to indemnify GGO as a
consequence of the Indemnity Cap, then solely with respect to such payments,
the Company shall pay such amount of MPC Taxes and the principal amount of the
GGO Promissory Note shall be increased by the amount of such payment and if at
such time no GGO Promissory Note is outstanding, on the date of any such
payment, GGO shall issue in favor of the Company a promissory note in the
aggregate principal amount of such payment on the same terms as the GGO
Promissory Note.

 

ARTICLE VI

 

ADDITIONAL COVENANTS OF PURCHASER

 

SECTION 6.1         Information.  From and after the date of this Agreement
until the earlier to occur of the Closing Date and the termination of this
Agreement, Purchaser agrees to provide the Debtors with such information as the
Debtors reasonably request regarding Purchaser for inclusion in the Disclosure
Statement as necessary for the Disclosure Statement to contain adequate
information for purposes of Section 1125 of the Bankruptcy Code.

 

SECTION 6.2         Purchaser Efforts.  Purchaser shall use its reasonable best
efforts to obtain all material permits, consents, orders, approvals, waivers,
authorizations or other permissions or actions required for the consummation of
the transactions contemplated by this Agreement from, and shall have given all
necessary notices to, all Governmental Entities necessary to satisfy the
condition in Section 8.1(b) (provided, however,
that Purchaser shall not be required to pay or cause payment of any fees or
make any financial accommodations to obtain any such consent, approval, waiver
or other permission, except filing fees as required), and provide to such
Governmental Entities all such information as may be necessary or reasonably
requested relating to the transactions contemplated hereby.

 

SECTION 6.3         Plan Support.  From and after the date of this Agreement
until the earliest to occur of (i) the Effective Date, (ii) the
termination of this Agreement and (iii) the date the Company or any
Subsidiary of the Company makes a public announcement, enters into an agreement
or files any pleading or document with the Bankruptcy Court, in each case,
evidencing its intention to support any Competing Transaction, or the Company
or any Subsidiary of the Company enters into a Competing Transaction, Purchaser
agrees (unless otherwise consented to by the Company) (provided, that
(x) the Company is not in material breach of this Agreement and (y) the
terms of the Plan are and remain consistent with the Plan Summary Term Sheet
and this Agreement, and are otherwise in form and substance satisfactory to
Purchaser) to (and shall use reasonable best efforts to cause its Affiliates
to):

 

(a)           Not pursue, propose, support, vote to accept or
encourage the pursuit, proposal or support of, any Chapter 11 plan, or other
restructuring or reorganization for the Company, or any Subsidiary of the
Company, that is not consistent with the Plan;

 

(b)           Not, nor encourage any other Person to, interfere
with, delay, impede, appeal or take any other negative action, directly or
indirectly, in any respect regarding acceptance or implementation of the Plan;
and

 

42

 

(c)           Not commence any proceeding, or prosecute any objection
to oppose or object to the Plan or to the Disclosure Statement and not to take
any action that would delay approval or confirmation, as applicable, of the
Disclosure Statement and the Plan, in each case (i) except as intended to
ensure the consistency of the Disclosure Statement and the Plan with the terms
of this Agreement and the rights and obligations of the parties thereto and
(ii) without limiting any rights Purchaser may have to terminate this
Agreement pursuant to Section 11.1(b) (including Section 11.1(b)(x))
hereof.

 

SECTION 6.4         Transfer Restrictions.  Purchaser covenants and agrees that the
Shares and the GGO Shares (and shares issuable upon exercise of Warrants, New
Warrants and GGO Warrants) shall be disposed of only pursuant to an effective
registration statement under the Securities Act or pursuant to an available
exemption from the registration requirements of the Securities Act, and in
compliance with any applicable state securities Laws.  Purchaser agrees to the imprinting, so long
as is required by this Section 6.4, of the following legend on any
certificate evidencing the Shares or GGO Shares (and shares issuable upon
exercise of Warrants, New Warrants and GGO Warrants):

 

THE SHARES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AS AMENDED (THE “ACT”) OR UNDER ANY STATE
SECURITIES LAWS (“BLUE SKY”) OR THE SECURITIES LAWS OF ANY OTHER
RELEVANT JURISDICTION.  THE SHARES HAVE
BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO DISTRIBUTION OR
RESALE.  THE SHARES MAY NOT BE SOLD,
ASSIGNED, MORTGAGED, PLEDGED, ENCUMBERED, HYPOTHECATED, TRANSFERRED OR
OTHERWISE DISPOSED OF UNLESS EITHER (I) A REGISTRATION STATEMENT WITH
RESPECT TO THE SHARES IS EFFECTIVE UNDER THE ACT AND APPLICABLE BLUE SKY LAWS
AND THE SECURITIES LAWS OF ANY OTHER RELEVANT JURISDICTION ARE COMPLIED WITH OR
(II) UNLESS WAIVED BY THE ISSUER, THE ISSUER RECEIVES AN OPINION OF LEGAL
COUNSEL SATISFACTORY TO THE ISSUER THAT NO VIOLATION OF THE ACT OR OTHER
APPLICABLE LAWS WILL BE INVOLVED IN SUCH TRANSACTION.

 

Certificates evidencing the Shares (and shares
issuable upon exercise of Warrants and New Warrants) shall not be required to
contain such legend (A) while a registration statement covering the resale
of the Shares is effective under the Securities Act, or (B) following any
sale of any such Shares pursuant to Rule 144 of the Exchange Act (“Rule 144”),
or (C) following receipt of a legal opinion of counsel to Purchaser that
the remaining Shares held by Purchaser are eligible for resale without volume
limitations or other limitations under Rule 144.  In addition, the Company will agree to the
removal of all legends with respect to shares of New Common Stock deposited
with DTC from time to time in anticipation of sale in accordance with the
volume limitations and other limitations under Rule 144, subject to the
Company’s approval of appropriate procedures, such approval not to be
unreasonably withheld, conditioned or delayed.

 

Following the time at which such legend is no longer
required (as provided above) for certain Shares, the Company shall promptly,
following the delivery by Purchaser to the Company of a legended certificate
representing such Shares, deliver or cause to be delivered to Purchaser a
certificate representing such Shares that is free from such legend.  In the event the above legend is removed from
any of the Shares, and thereafter the effectiveness of a registration 

 

43

 

statement covering such Shares is suspended or the
Company determines that a supplement or amendment thereto is required by
applicable securities Laws, then the Company may require that the above legend
be placed on any such Shares that cannot then be sold pursuant to an effective
registration statement or under Rule 144 and Purchaser shall cooperate in
the replacement of such legend.  Such
legend shall thereafter be removed when such Shares may again be sold pursuant
to an effective registration statement or under Rule 144.

 

The Plan shall
provide, in connection with the consummation of the Plan, for
GGO to enter into an agreement with Purchaser with respect to GGO Shares and
GGO Warrants containing the same terms as provided above in this  Section 6.4 but replacing references to (A) “the
Company” with GGO, (B) “New Common Stock” with GGO Common Stock, (C) “Shares”
with “GGO Shares” and (D) “Warrants” or “New Warrants” with GGO Warrants.

 

Purchaser shall further covenant and agree in an
agreement to be entered into with GGO in connection with the Plan not to sell,
transfer or dispose of (each, a “Transfer”) (x) GGO Shares, GGO
Warrants, or shares issuable upon exercise of the GGO Warrants during the
period from and after the Closing Date to the six (6) month anniversary of
the Closing Date, (y) in excess of (A) 8.25% of the GGO Shares and
(B) 8.25% of the GGO Warrants or the shares issuable upon exercise of the
GGO Warrants, in the aggregate, during the period from and after the six (6) month
anniversary of the Closing Date to the one (1) year anniversary of the
Closing Date and (z) in excess of (A) 16.5% of the GGO Shares and (B) 16.5%
of the GGO Warrants or the shares issuable upon exercise of the GGO Warrants,
in the aggregate (and taken together with any Transfers effected under clause
(y)), during the period from and after the six (6) month anniversary of
the Closing Date to the eighteen (18) month anniversary of the Closing
Date.  For clarity, Purchaser shall not
be restricted from Transferring any GGO Shares, GGO Warrants, or shares
issuable upon exercise of the GGO Warrants from and after the eighteen (18)
month anniversary of the Closing Date.

 

Prior to the Closing, Purchaser shall not Transfer
the Warrants or the shares of Common Stock issuable upon exercise of the
Warrants prior to the earlier of (i) termination of this Agreement or (ii) the
date the Company or any Subsidiary of the Company (A) makes a public
announcement, enters into an agreement or files any pleading or document with
the Bankruptcy Court, in each case, evidencing its decision to support any
Competing Transaction, or the Company or any Subsidiary of the Company enters
into a definitive agreement providing for a Competing Transaction or (B) provides
notice to Purchaser of its or any of its Subsidiaries decision to enter into,
or entry into, a definitive agreement providing for a Competing Transaction.

 

Notwithstanding anything herein to the contrary (but
subject to the Non-Control Agreement), Purchaser shall be permitted to Transfer
any portion or all of its Shares, GGO Shares, the Warrants, the New Warrants,
the GGO Warrants and the shares of Common Stock or New Common Stock issuable
upon exercise of the Warrants, the New Warrants and the GGO Warrants at any
time under the following circumstances (provided, that none of
Purchaser’s rights and benefits under this Agreement shall inure to the benefit
of any transferee under clause (ii) or (iii) below):

 

44

 

(i)            Transfers to any Affiliate
of Purchaser, any member of Purchaser, any Brookfield Consortium Member and any
member, partner or shareholder or any Affiliate of any Brookfield Consortium
Member, in accordance with and subject to the Designation Conditions.

 

(ii)           Transfers pursuant to a
merger or tender offer or exchange offer involving the Company in which any
Person acquires more than 50% of the outstanding Common Stock on a Fully
Diluted Basis.

 

(iii)          Any bona fide mortgage,
encumbrance, pledge or hypothecation of capital stock to a financial
institution in connection with any bona fide loan.

 

For the avoidance of doubt, Purchaser’s rights to
designate for nomination the Purchaser Board Designees and Purchaser GGO Board
Designees pursuant to Section 5.10 and Subscription Rights pursuant
to Section 5.9 may not be Transferred to a Person that is not a
Brookfield Consortium Member.

 

Purchaser agrees to the imprinting of a legend
referencing the above transfer restrictions on any certificate evidencing the
Shares or GGO Shares (and shares issuable upon exercise of Warrants, New
Warrants and GGO Warrants).  In
connection with any transfer of the Shares or GGO Shares (and shares issuable
upon exercise of Warrants, New Warrants and GGO Warrants), the Company shall
remove such legends from such certificates to the extent the transferee thereof
is not bound by such transfer restrictions.

 

SECTION 6.5         Equity Commitments; Source of Funds.

 

(a)           Without the prior written consent of the Company,
prior to the Release Date (as defined in the Escrow Agreements), except as
contemplated by Section 6.5(b) below, Purchaser shall not (i) enter
into any amendments or waive any provision of or terminate the Brookfield
Equity Commitment Letter or the Escrow Agreements or any Acceptable LC or (ii) instruct
the Escrow Agent to distribute any of the Escrow Amount to an Equity Provider
pursuant to Section 4(a)(ii) of the Escrow Agreements.

 

(b)           In the event that at any time following the
execution of the Escrow Agreements, one or more Equity Providers secures and
delivers to Purchaser an Acceptable LC in replacement for its Commitment Amount
(as defined in the applicable Escrow Agreement), Purchaser shall be entitled to
amend or terminate the applicable Escrow Agreement replaced by an Acceptable LC
without the consent of the Company. 
Without the consent of the Company, Purchaser shall not permit any
amendments, waivers or terminations of any Acceptable LC.

 

(c)           Prior to the earlier to occur of the Closing and the
termination of this Agreement, Purchaser shall not dividend, distribute or
otherwise transfer or dispose of any cash or other assets other than to pay the
Purchase Price and the GGO Purchase Price and pursuant to Article II.

 

SECTION 6.6         REIT Representations and Covenants.  At such times as shall be reasonably
requested by the Company, for so long as Purchaser (or, to the extent
applicable, its Affiliates, members or Affiliates of members) beneficially or
constructively owns in excess of 

 

45

 

the
relevant ownership limit set forth in the certificate of incorporation of the
Company of the outstanding Common Stock or New Common Stock, Purchaser shall
(and, to the extent applicable, cause its Affiliates, members or Affiliates of
members to) use reasonable best efforts to provide the Company with customary
representations and covenants, in the form attached hereto as Exhibit D
which shall, among other things, enable the Company to provide a waiver of the
ownership limit set forth in the certificate of incorporation of the Company to
Purchaser and ensure that the Company can appropriately monitor any “related
party rent” issues raised by the Warrants and the purchase of the Shares by
Purchaser, it being understood that Purchaser’s Affiliates, members or
Affiliates of members shall be required to provide such representations and
covenants only if such Person beneficially owns Common Stock or New Common
Stock in excess of the relevant ownership limit set forth in the certificate of
incorporation of the Company or any stock or other equity interest owned by
such Person in a tenant of the Company would be treated as constructively owned
by Purchaser.

 

SECTION 6.7         Non-Control Agreement.  At or prior to the Closing, Purchaser shall
enter into the Non-Control Agreement with the Company.

 

SECTION 6.8         Purchaser Formed Entities.  Purchaser Formed Entities were formed by
Purchaser solely for the purpose of engaging in the reorganization transactions
contemplated by Exhibit B hereto. 
None of the Purchaser Formed Entities has engaged in any other business
activities and has conducted and will conduct its operations prior to the Closing
only as contemplated by this Agreement, including Exhibit B.  Prior to the Closing, Purchaser shall cause
the Purchaser Formed Entities not to (i) incur any liabilities (other than
as contemplated by this Agreement) or (ii) take any action to cause any
condition to the Closing hereunder not to be satisfied.

 

SECTION 6.9         Additional Backstops.

 

(a)           The Company may, at its option, include in the Plan
an offering (the “GGP Backstop Rights Offering”) to its then-existing
holders of Common Stock of rights to purchase New Common Stock on the Effective
Date in an amount sufficient to yield to the Company aggregate net proceeds on
the Effective Date of up to $500,000,000 or such lesser amount as the Company
may determine (the “GGP Backstop Rights Offering Amount”).  In connection with the GGP Backstop Rights
Offering:

 

(i)            Purchaser and the Pershing
Investors (together with the Purchaser, the “Backstop Investors”) and
the Company shall appoint a mutually-acceptable and internationally-recognized
investment bank to act as bookrunning dealer-manager for the GGP Backstop
Rights Offering (the “Dealer Manager”) pursuant to such arrangements as
they may mutually agree;

 

(ii)           the Dealer Manager will, no
later than the fifth business day in advance of the commencement of the
solicitation of votes on the Plan and offering of rights in the GGP Backstop
Rights Offering (which shall not be longer than 60 days), recommend in writing
to the Backstop Investors and the Company the number of shares of New Common
Stock that may be purchased for each share of Common Stock, the subscription
price of such purchase and the other terms for the rights offering that the
Dealer Manager 

 

46

 

determines are reasonably likely to yield committed
proceeds to the Company at the Effective Date equal to the GGP Backstop Rights
Offering Amount (it being understood that the Dealer Manager will have no
liability if it is later determined that its good faith determination was
erroneous);

 

(iii)          the Backstop Investors
agree, severally but not jointly and severally, to subscribe, or cause one or
more designees to subscribe, for New Common Stock on a pro rata basis to the
extent rights are declined by holders of Common Stock, subject to the
subscription rights among the Backstop Investors set forth in clause (iv);

 

(iv)          the Backstop Investors will
have subscription rights in any such offering allowing them to maintain their
respective proportionate pro forma New Common Stock -equivalent interests on a
Fully Diluted Basis with the effect that the Backstop Investors will be assured
of the ability to acquire such number of shares of New Common Stock as would
have been available to them pursuant to Section 5.9 had the GGP
Backstop Rights Offering been made after the Closing;

 

(v)           the Backstop Investors will
receive aggregate compensation in the form of New Common Stock (whether or not
the backstop commitments are utilized) with a value equal to three percent (3%)
of the GGP Backstop Rights Offering Amount; and

 

(vi)          the amount of New Common
Stock to be purchased pursuant to the GGP Backstop Rights Offering will be
subject to reduction to the extent that either (A) the Company Board
determines in its business judgment after consultation with the Backstop
Investors that it has sufficient liquidity and working capital available to it
in light of circumstances at the time and the costs and benefits to the Company
of consummation of the GGP Backstop Rights Offering or (B) the Backstop
Investors have agreed that they will provide to the Company, in lieu of the GGP
Backstop Rights Offering, the Bridge Securities contemplated in clause (b) below.

 

(b)           The Company shall give each Backstop Investor
written notice of its estimate of the amount the Backstop Investors will be
required to fund pursuant to Section 6.9(a) no later than six
(6) Business Days prior to the Closing Date.  If each Backstop Investor agrees, the
Backstop Investors shall have two (2) Business Days from the date of
receipt of such notice to notify the Company in writing that they intend to
elect to purchase from the Company in lieu of all or part of the proceeds to be
provided by the GGP Backstop Rights Offering its pro rata portion of senior
subordinated unsecured notes and/or preferred stock instruments (at the
election of the Backstop Investors) on market terms except as provided below
(the “Bridge Securities”).  The
Bridge Securities would have a final maturity date, in the case of a note, and
a mandatory redemption date, in the case of preferred stock, on the 270th day
after the Effective Date, would not require any mandatory interim cash
distributions except as contemplated in (i) below, and would yield to the
Company on the Closing Date cash proceeds (net of OID) of at least the proceeds
from the GGP Backstop Rights Offering that such Bridge Securities are intended
to replace.  The Bridge Securities would
be subordinated in right of payment to any New Debt, would have market coupon
and fees, would allow for any interest due prior to maturity to be “paid in kind”
(rather than paid in cash) at the election of the Company, would be prepayable,
without any prepayment penalty or prepayment premium, on a pro rata basis at
any time, and 

 

47

 

would
otherwise be on market terms (determined such that fair value of the Bridge
Securities as of the Effective Date is equal to par minus OID).

 

If the GGP Backstop Rights Offering is
completed or the Bridge Securities are issued:

 

(i)            unless the Backstop
Investors otherwise agree, the Bridge Securities shall be subject to mandatory
prepayment on a pro rata basis out of the proceeds of any equity or debt
securities offered or sold by the Company at any time the Bridge Securities are
outstanding (other than the New Common Stock sold to the Backstop Investors,
any New Common Stock sold in the GGP Backstop Rights Offering and the New
Debt); and

 

(ii)           if the Bridge Securities are
issued and not repaid on or before the date that is thirty (30) days following
the Effective Date, the Company shall conduct a rights offering in an amount
equal to the outstanding amount due with respect to the Bridge Securities and
with a pro rata backstop by each applicable Backstop Investor on substantially
the same procedure and terms provided in clause (a) above, with such
rights offering to have a subscription period of not more than 30 days that
ends no later than the 10th day prior to the final maturity date or mandatory
redemption of the Bridge Securities.

 

(c)           If the Company requests Purchaser and the Fairholme/Pershing
Investors (collectively, the “Initial Investors”), in writing, at any
time prior to fifteen (15) days before the commencement of solicitation of
acceptances of the Plan, each Initial Investor agrees that it shall, severally
but not jointly and severally, provide or cause a designee to provide its pro
rata share of a backstop for new bonds, loans or preferred stock (as determined
by the Initial Investor) in an aggregate amount equal to $1,500,000,000 less
the Reinstated Amounts, at a market rate and market commitment fees, and
otherwise on terms and conditions to be mutually agreed among the Initial
Investors and the Company.  Any such
notice shall be revocable by the Company in its sole discretion.  The new bonds, loans or preferred stock would
require no mandatory interim cash principal payments prior to the third
anniversary of issuance (unless funded from committed junior indebtedness or
junior preferred stock), and would yield proceeds to the Company on the Closing
Date net of OID of at least $1,500,000,000 less the Reinstated Amounts.  Any Initial Investor may at any time
designate in writing one or more financial institutions with a corporate
investment grade credit rating (from S&P or Moody’s) to make a
substantially similar undertaking as that provided herein and, upon the receipt
of such an undertaking by the Company in form and substance reasonably
satisfactory to the Company, such Initial Investor shall be released from its
obligations under this Agreement, the Fairholme Agreement or the Pershing
Agreement, as applicable.

 

(d)           For the purposes of Section 6.9(a) and
Section 6.9(b), the “pro rata share” or “pro rata basis” of each
Backstop Investor shall be determined in accordance with the maximum number of
shares of New Common Stock each Backstop Investor has committed to purchase at
Closing pursuant to the Pershing Agreement or this Agreement, as applicable, as
of the date hereof, in relation to the aggregate maximum number of shares of
New Common Stock all Backstop Investors have committed to purchase at Closing
pursuant to the Pershing Agreement or this Agreement, as applicable, as of the
date hereof.  For the purposes of Section 6.9(c),
the 

 

48

 

“pro
rata share” or “pro rata basis” of each Initial Investor shall be determined in
accordance with the maximum number of shares of New Common Stock each Initial
Investor has committed to purchase at Closing pursuant to the
Fairholme/Pershing Agreements or this Agreement, as applicable, as of the date
hereof, but excluding any shares of New Common Stock the Backstop Investors
have committed to purchase pursuant to this Section 6.9.

 

(e)           Section 6.9(a) and Section 6.9(b) shall
terminate automatically without any action by any party upon entry of an order
of the Bankruptcy Court approving the termination fee and expense reimbursement
set forth in that certain Stock Purchase Agreement, dated as of July 8,
2010, by and between the Company and Teacher Retirement System of Texas, as to
which order the time to appeal or petition for writ of certiorari shall have
expired or if an appeal shall have been sought, such order shall have been
affirmed by the highest court to which such order was appealed without
modification of such order.

 

ARTICLE VII

 

CONDITIONS TO THE OBLIGATIONS OF
PURCHASER

 

SECTION 7.1         Conditions to the Obligations of Purchaser.  The obligation of Purchaser to purchase the
Shares and the GGO Shares pursuant to this Agreement on the Closing Date are
subject to the satisfaction (or waiver (to the extent permitted by applicable
Law) by Purchaser) of the following conditions as of the Closing Date:

 

(a)           No Injunction.  No judgment, injunction, decree or other
legal restraint shall prohibit the consummation of the Plan or the transactions
contemplated by this Agreement.

 

(b)           Regulatory Approvals; Consents.  All permits, consents, orders, approvals,
waivers, authorizations or other permissions or actions of third parties and
Governmental Entities required for the consummation of the transactions
contemplated by this Agreement and the Plan shall have been made or received,
as the case may be, and shall be in full force and effect, except for those
permits, consents, orders, approvals, waivers, authorizations or other
permissions or actions the failure of which to make or receive would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect (it being agreed that any permit, consent, order, approval,
waiver, authorization or other permission or action in respect of any
Identified Asset for which any of the alternatives in Section 2.1(a) shall
have been employed shall be deemed hereunder to have been made or received, as
the case may be, and in full force and effect).

 

(c)           Representations and Warranties and Covenants.  Except for changes permitted or contemplated
by this Agreement or the Plan Summary Term Sheet, each of (i) the
representations and warranties of the Company contained in Section 3.1,
Section 3.2, Section 3.3, Section 3.5, Section 3.20(a) (except
for such inaccuracies in Section 3.20(a) caused by sales,
purchases or transfers of assets which have been effected in accordance with,
subject to the limitations contained in, and not otherwise prohibited by, the
terms and conditions in this Agreement, including, without limitation, this Article VII)
and Section 3.23 shall be true and correct at and as of the Closing
Date as if made at and as of the Closing Date (except for representations and
warranties made as of a specific date, which shall be true and correct only as 

 

49

 

of
such specific date), (ii) the representations and warranties of the
Company contained in Section 3.4 shall be true and correct (except
for de minimis inaccuracies) at and as of
the Closing Date as if made at and as of the Closing Date (except for
representations and warranties made as of a specific date, which shall be true
and correct (except for de minimis
inaccuracies) only as of such specific date) and (iii) the other
representations and warranties of the Company contained in this Agreement,
disregarding all qualifications and exceptions contained therein relating to
“materiality” or “Material Adverse Effect”, shall be true and correct at and as
of the Closing Date as if made at and as of the Closing Date (except for
representations and warranties made as of a specified date, which shall be true
and correct only as of the specified date), except for such failures to be true
and correct that, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect (it being agreed that the condition
in this subclause (iii) as it relates to undisclosed liabilities of the
Company and its Subsidiaries comprised of Indebtedness shall be deemed to be
satisfied if the condition in Section 7.1(p) is
satisfied.  In addition, for purposes of this Section 7.1(c) as it
relates to Section 3.20(b) of this Agreement, the reference to
“DIP Loan” in clause (i) of such Section 3.20(b) shall be
deemed to refer to that certain Senior Secured Debtor in Possession Credit,
Security and Guaranty Agreement, dated as of July 23, 2010, by and among
the Company, GGP Limited Partnership, the lenders party thereto, Barclays
Capital, as the Sole Arranger, Barclays Bank PLC, as the Administrative Agent
and Collateral Agent, and the guarantors party thereto (the “New DIP
Agreement”).  The Company shall have complied in all
material respects with all of its obligations under this Agreement, provided
that with respect to its obligations under Section 5.14(a), Section 5.14(b) (to
the extent applicable) and Section 5.14(c) hereof, the Company
shall have complied therewith in all respects. 
The Company shall have provided to Purchaser a certificate delivered by
an executive officer of the Company, acting in his or her official capacity on
behalf of the Company, to the effect that the conditions in this clause (c) and
the immediately following clause (d) have been satisfied as of the Closing
Date and Purchaser shall have received such other evidence of the conditions
set forth in this Section 7.1 as it shall reasonably request.

 

(d)           No Material Adverse Effect.  Since the date of this Agreement, there shall
not have occurred any event, fact or circumstance, that has had or would
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.

 

(e)           Plan and Confirmation Order.  The Plan, in form and substance satisfactory
to Purchaser, shall have been confirmed by the Bankruptcy Court by order in
form and substance satisfactory to Purchaser (the “Confirmation Order”),
which Confirmation Order shall be in full force and effect (without waiver of
the 14 day period set forth in Bankruptcy Rule 3020(e)) as of the
Effective Date and shall not be subject to a stay of effectiveness.

 

(f)            Disclosure Statement.  The Disclosure Statement, in form and
substance acceptable to Purchaser, shall have been approved by order of the
Bankruptcy Court in form and substance satisfactory to Purchaser (the “Disclosure
Statement Order”).

 

(g)           Conditions to Confirmation.  The conditions to confirmation and the
conditions to the Effective Date of the Plan, including the consummation of the
transactions contemplated by Exhibit B, shall have been satisfied
or waived in accordance with the Plan and the Reorganized Company
Organizational Documents as set forth in the Plan shall be in effect.

 

50

 

(h)           GGO.  The GGO Share Distribution and the issuance
by GGO of the GGO Warrants shall have occurred in accordance with this
Agreement.  In connection with the
implementation of the GGO Share Distribution, (i) the Company shall have
provided Purchaser with reasonable access to all relevant information and
consulted and cooperated in good faith with Purchaser and the GGO
Representative with respect to the contribution of the Identified Assets to GGO
in accordance with Section 2.1(a), and (ii) all actions taken
by the Company and its Subsidiaries related thereto and all documentation
related to the formation and organization of GGO, the implementation of the GGO
Share Distribution, to separate the business of the Company and GGO and other
intercompany arrangements between the Company and GGO, in each case, shall be
reasonably satisfactory to Purchaser and shall be in full force and effect.

 

(i)            GGO
Common Stock.  GGO shall not have
issued and outstanding on a Fully Diluted Basis immediately following the Closing
more than the GGO Common Share Amount of shares of GGO Common Stock (plus (A) an
aggregate 5,250,000 shares issuable to the Purchaser and the Fairholme/Pershing
Investors pursuant to this Agreement and the Fairholme/Pershing Agreements, (B) such
shares of GGO Common Stock issuable upon exercise of the GGO Warrants pursuant
to Section 5.2, (C) such shares of GGO Common Stock issuable
upon the exercise of warrants that may be issued to the Fairholme/Pershing
Investors pursuant to the Fairholme/Pershing Agreements).

 

(j)            Valid
Issuance.  The Shares, Warrants, New
Warrants and GGO Warrants and the GGO Shares shall be validly issued to
Purchaser (against payment therefor in the case of the Shares and the GGO
Shares).  The Company and GGO shall have
executed and delivered the warrant agreement for each of the New Warrants and
the GGO Warrants, together with such other customary documentation as Purchaser
may reasonably request in connection with such issuance; each warrant agreement
shall be in full force and effect and neither the Company nor GGO shall be in
breach of any representation, warranty, covenant or agreement thereunder in any
material respect.

 

(k)           No
Legal Impediment to Issuance.  No
action shall have been taken and no statute, rule, regulation or order shall
have been enacted, adopted or issued by any federal, state or foreign
governmental or regulatory authority that prohibits the issuance or sale of,
pursuant to this Agreement, the Shares, the issuance of Warrants, New Warrants,
GGO Shares, GGO Warrants, the issuance of New Common Stock upon exercise of the
New Warrants or the issuance of GGO Common Stock upon exercise of the GGO
Warrants; and no injunction or order of any federal, state or foreign court
shall have been issued that prohibits the issuance or sale, pursuant to this
Agreement, of the Shares, the GGO Shares, the Warrants, New Warrants, GGO
Warrants, the issuance of New Common Stock upon exercise of the New Warrants or
the issuance of GGO Common Stock upon exercise of the GGO Warrants.

 

(l)            Registration
Rights Agreements.  Each of the
Company and GGO shall have entered into a registration rights agreement with
Purchaser with respect to all registrable securities issued to or held by
Purchaser or any Brookfield Consortium Member from time to time in a manner
that permits the registered offering of securities pursuant to such methods of
sale as Purchaser may reasonably request from time to time.  Each registration rights agreement shall
provide for (i) an unlimited number of shelf registration demands on Form S-3
to the extent that the Company or GGO, as applicable, is then permitted to file
a registration statement on 

 

51

 

Form S-3,
(ii) if the Company or GGO, as applicable, is not eligible to use Form S-3,
the filing by the Company or GGO, as applicable, of a registration statement on
Form S-1 or Form S-11, as applicable, and the Company or GGO, as
applicable, using its reasonable best efforts to keep such registration
statement continuously effective; (iii) piggyback rights not less
favorable than those provided in the Warrant Agreement; (iv) with respect
to the Company, underwritten offerings during the term of the registration
rights agreement, but not more than one (1) underwritten offering in any
12-month period during the three (3) year period following the Closing
Date and not more than two (2) underwritten offerings in any 12-month
period thereafter, provided that in no event shall the Company be required to
effect more than three (3) underwritten offerings in the aggregate in any
12-month period at the request of Purchaser and the Other Sponsors and, with
respect to GGO, at least three underwritten offerings during the term of the
registration rights agreement, but not more than one in any 12-month period;
(v) “black-out” periods not less favorable than those provided in the
Warrant Agreement; (vi) “lock-up” agreements by the Company or GGO, as
applicable, to the extent requested by the managing underwriter in any
underwritten public offering requested by Purchaser consistent with those
provided in the Warrant Agreement (it being understood that the registration
rights agreement will include procedures, reasonably acceptable to Purchaser
and the Company, designed to ensure that the total number of days that the
Company or GGO, as applicable, may be subject to a lock-up shall not, in the
aggregate after taking into account any applicable lock-up periods resulting
from registration rights agreements between the Company or GGO, as applicable,
and the Fairholme/Pershing Investors, exceed 120 days in any 365-day period);
(vii) to the extent that Purchaser and any Brookfield Consortium Member in
the aggregate hold in excess of 20% of the New Common Stock or GGO Common
Stock, as applicable, on a fully diluted basis at the time of an underwritten
public offering by the Company or GGO, as applicable, Purchaser and such
Brookfield Consortium Member will agree to a 60-day customary lock up to the
extent requested by the managing underwriter; and (viii) other terms and
conditions reasonably acceptable to Purchaser. 
The registration rights agreement shall be in full force and effect and
neither the Company nor GGO shall be in breach of any representation, warranty,
covenant or agreement thereunder in any material respect.

 

(m)          Listing.  The Shares shall be authorized for listing on
the NYSE, subject to official notice of issuance, and the shares of New Common
Stock issuable upon exercise of the New Warrants shall be eligible for listing
on the NYSE.  The GGO Shares shall be
authorized for listing on a U.S. national securities exchange, subject to
official notice of issuance, and the shares of GGO Common Stock issuable upon
exercise of the GGO Warrants shall be eligible for listing on a U.S. national
securities exchange.

 

(n)           Liquidity.  The Company shall have, on the Effective Date
and after giving effect to the use of proceeds from Capital Raising Activities
permitted under this Agreement and the issuance of the Shares, and the payment
and/or reserve for all allowed and disputed claims under the Plan, transaction
fees and other amounts required to be paid in cash or Shares under the Plan as
contemplated by the Plan Summary Term Sheet, an aggregate amount of not less
than $350,000,000 of Proportionally Consolidated Unrestricted Cash (the “Liquidity
Target”) plus the net proceeds of the Additional Financings and the
aggregate principal amount of the Anticipated Debt Paydowns (or such higher
number as may be agreed to by Purchaser and the Company) plus the excess, if
any, of (A) the aggregate principal amount of New Debt and the Reinstated
Amounts over (B) $1,500,000,000.

 

52

 

(o)           Board
of Directors.  Three persons
designated by Purchaser pursuant to Section 5.10(a) shall have
been duly appointed to the Company Board and one person designated by Purchaser
pursuant to Section 5.10(b) shall have been duly appointed to
the GGO Board.

 

(p)           Debt
of the Company.  Immediately
following the Closing after giving effect to the Plan, the aggregate
outstanding Proportionally Consolidated Debt shall not exceed $22,250,000,000
in the aggregate minus (i) the amount of Proportionally Consolidated Debt
attributable to assets sold, returned, abandoned, conveyed, transferred or
otherwise divested during the period between the date of this Agreement through
the Closing and minus (ii) the excess, if any, of $1,500,000,000 over the
aggregate principal amount of new Unsecured Indebtedness incurred after the
date of this Agreement and on or prior to the Closing Date for cash (“New
Debt”) and the aggregate principal amount of any Debt under the Rouse Bonds
or the Exchangeable Notes that is reinstated under the Plan (such amounts
reinstated, the “Reinstated Amounts”) minus (iii) the amount of
Proportionally Consolidated Debt attributable to Identified Assets contributed
to GGO pursuant to Section 2.1(a), minus (iv) the amount of
Proportionally Consolidated Debt attributable to assets other than Identified
Assets contributed to GGO pursuant to Section 2.1(a) minus (v) the
principal and/or liquidation preference of the TRUPS and the UPREIT Units not
reinstated, plus (vi) in the event the Closing occurs prior to September 30,
2010, the amount of scheduled amortization on Proportionally Consolidated Debt
(other than Corporate Level Debt) from the Closing Date to September 30,
2010 that otherwise would have been paid by September 30, 2010, minus
(vii) in the event the Closing occurs on or after September 30, 2010,
the amount of actual amortization paid on Proportionally Consolidated Debt
(other than Corporate Level Debt) from September 30, 2010 to the Closing
Date, plus (viii) (A) the excess of the aggregate principal amount of
new Debt incurred to refinance existing Debt in accordance with Section 7.1(r)(vii) hereof
over the principal amount of the Debt so refinanced and (B) new Debt
incurred to finance unencumbered Company Properties and Non-Controlling
Properties after the date of this Agreement and on or prior to the Closing
(such amounts contemplated by clauses (A) and (B) collectively, the “Additional
Financing”) plus (ix) the amount of other principal paydowns,
writedowns and resulting impact on amortization (or payments in the anticipated
amortization schedule with respect to Fashion Show Mall (Fashion Show Mall
LLC), The Shoppes at the Palazzo and Oakwood Shopping Center (Gretna, LA))
currently anticipated to be made by the Company in connection with
refinancings, or completion of negotiations in respect of its property level
Debt which the Company determines in good faith are not actually required to be
made prior to Closing (“Anticipated Debt Paydowns”) plus (x) the
excess, if any, of (A) the aggregate principal amount of New Debt and the
Reinstated Amounts over (B) $1,500,000,000 plus (xi) the aggregate
amount of the Bridge Notes (as defined in the Pershing Agreement) issued
pursuant to Section 1.4 of the Pershing Agreement (and the parties agree
that such Bridge Notes shall not be included in the calculation of Closing Date
Net Debt or Closing Date Net Debt W/O Reinstatement Adjustment).

 

(q)           Outstanding
Common Stock.  The
number of issued and outstanding shares of New Common Stock on a Fully Diluted
Basis (including the Shares) shall not exceed the Share Cap Number.  The “Share Cap Number” means
1,104,683,256 plus the number of shares (if any) issued to settle or otherwise
satisfy Hughes Heirs Obligations, plus up to 65,000,000 shares of New Common
Stock issued in Liquidity Equity Issuances, plus the shares of New Common Stock
issuable upon the exercise of the New Warrants, plus the shares of New Common
Stock issuable upon the exercise of those certain warrants issued to the
Fairholme/Pershing Investors 

 

53

 

pursuant
to the Fairholme/Pershing Agreements, plus the number of shares of Common Stock
issued as a result of the exercise of employee stock options to purchase Common
Stock outstanding on the date hereof, plus, in the event shares of New Common
Stock are issued pursuant to Section 6.9, the difference between
(i) the number of shares of New Common Stock issued to existing holders of
Common Stock and the Initial Investors, in each case, pursuant to Section 6.9)
minus (ii) 50,000,000 shares of New Common Stock, minus the number of Put
Shares (as defined in the Pershing Agreement) under the Pershing Agreement
(which shall not be considered Share Equivalents for purposes of this
calculation); provided, that if Indebtedness under the Rouse Bonds or
the Exchangeable Notes is reinstated under the Plan, or the Company shall have
incurred New Debt, or between the date of this Agreement and the Closing Date
the Company shall have sold for cash real property assets outside of the
ordinary course of business (“Asset Sales”), the Share Cap Number shall
be reduced by the quotient (rounded up to the nearest whole number) obtained by
dividing (x) the sum of (a) the lesser of (I) $1,500,000,000 and
(II) the sum of Reinstated Amounts and the net cash proceeds to the
Company from the issuance of New Debt, and (b) the net cash proceeds to
the Company from Asset Sales in excess of $150,000,000 by (y) the Per
Share Purchase Price.

 

(r)            Conduct
of Business.  The following shall be
true in all material respects as of the Closing Date:

 

Except as otherwise expressly provided or permitted,
or contemplated, by this Agreement or the Plan Summary Term Sheet (including,
without limitation, in connection with implementing the matters contemplated by
Article II hereof) or any order of the Bankruptcy Court in effect
on the date of the Agreement, during the period from the date of this Agreement
to the Closing, the following actions shall not have been taken without the
prior written consent of Purchaser (which consent Purchaser agrees shall not be
unreasonably withheld, conditioned or delayed):

 

(i)            the
Company shall not have (A) declared, set aside or paid any dividends on,
or made any other distributions in respect of, any of the Company’s capital
stock (other than dividends required to retain REIT status or to avoid the
imposition of entity level taxes), (B) split, combined or reclassified any
of its capital stock or issued or authorized the issuance of any other
securities in respect of, in lieu of or in substitution for its capital stock,
or (C) purchased, redeemed or otherwise acquired (other than as set forth
on Section 7.1(r)(i) of the Company Disclosure Letter or
pursuant to Company Benefit Plans) any shares of its capital stock or any
rights, warrants or options to acquire any such shares;

 

(ii)           the
Company shall not have amended the Company’s certificate of incorporation or
bylaws other than to increase the authorized shares of capital stock;

 

(iii)          neither
the Company nor any of its Subsidiaries shall have acquired or agreed to
acquire by merging or consolidating with, or 

 

54

 

by purchasing a substantial portion of the stock, or
other ownership interests in, or substantial portion of assets of, or by any
other manner, any business or any corporation, partnership, association, joint
venture, limited liability company or other entity or division thereof except
(A) in the ordinary course of business, (B) for transactions with
respect to joint ventures existing on the date hereof valued at less than
$10,000,000 or (C) for transactions valued at less than $10,000,000 in the
aggregate;

 

(iv)          none
of the Company Properties, Non-Controlling Properties or Identified Assets
shall have been sold or otherwise transferred, except, (A) in the ordinary
course of business, (B) to a wholly owned Subsidiary of the Company (which
Subsidiary shall be subject to the same restrictions under this subsection
(iv)), and (C) for sales or other transfers, the net proceeds of which
shall not exceed $1,000,000,000 in the aggregate, when taken together with all
such sales and other transfers of Company Properties, Non-Controlling
Properties and Identified Assets (the “Sales Cap”); provided that the
Sales Cap shall not apply with respect to sales or transfers of Identified
Assets to the extent the same shall have been consummated in accordance with
the express terms and conditions set forth in Article II hereof;

 

(v)           [Intentionally
Omitted]

 

(vi)          none
of the Company or any of its Subsidiaries shall have issued, delivered,
granted, sold or disposed of any Equity Securities (other than
(A) issuances of shares of Common Stock issued pursuant to, and in
accordance with, Section 7.1(u), but subject to Section 7.1(q),
(B) pursuant to the Equity Exchange, (C) the issuance of shares
pursuant to the exercise of employee stock options issued pursuant to the
Company Option Plans, (D) as set forth on Section 7.1(u) of
the Company Disclosure Letter), or (E) the issuance of shares to existing
holders of Common Stock and the Backstop Investors, in each case, pursuant to Section 6.9);

 

(vii)         none
of the Company Properties or Identified Assets shall have been mortgaged, or
pledged, nor shall the owner or lessee thereof have granted a lien, mortgage,
pledge, security interest, charge, claim or other Encumbrance relating to debt
obligations of any kind or nature on, or otherwise encumbered, any Company
Property or Identified Assets except in the ordinary course of business
consistent with past practice, other than encumbrances of Company Properties or
Identified Assets of Debtors in connection with (A) a restructuring of
existing indebtedness for borrowed money related to any such Company Property
or Identified Asset with the existing lender(s) thereof or (B) a
refinancing of existing 

 

55

 

indebtedness for borrowed money related to any
Company Property or Identified Asset in an amount not to exceed $300,000,000
(the “Refinance Cap”), provided that (x) the Refinance Cap shall
not apply to a refinancing of the existing first lien indebtedness secured by
the Fashion Show Mall, (y) in the event that a refinancing is secured by
mortgages, deeds of trust, deeds to secure debt or indemnity deeds of trust
encumbering multiple Company Properties and Identified Assets, the proceeds of
such refinancing shall not exceed an amount equal to the Refinance Cap
multiplied by the number of Company Properties and Identified Assets so
encumbered, and (z) in connection with refinancing the indebtedness of a
Company Property or Identified Asset owned by a Joint Venture, the Refinance
Cap shall apply with respect to the aggregate share of such indebtedness which
is allocable to, or guaranteed by (but without duplication), the Company and/or
its Subsidiaries;

 

(viii)        none
of the Company or any of its Subsidiaries shall have undertaken any capital
expenditure that is out of the ordinary course of business consistent with past
practice and material to the Company and its Subsidiaries taken as a whole,
except as contemplated in the Company’s business plan for fiscal year 2010
adopted by the board of directors of the Company prior to the date hereof; or

 

(ix)           the
Company shall not have changed any of its methods, principles or practices of
financial accounting in effect, other than as required by GAAP or regulatory
guidelines (and except to implement purchase accounting and/or “fresh start”
accounting if the Company elects to do so).

 

(s)           REIT
Opinion.  Purchaser shall have
received an opinion of Arnold & Porter LLP, dated as of the Closing
Date, substantially in the form attached hereto as Exhibit J,
that the Company (x) for all taxable years commencing with the
taxable year ended December 31, 2005 through December 31, 2009, has
been subject to taxation as a REIT and (y) has operated
since January 1, 2010 to the Closing Date in a manner consistent with the
requirements for qualification and taxation as a REIT.

 

(t)            Non-Control
Agreement.  The Company shall have
entered into the Non-Control Agreement with Purchaser.  The Non-Control Agreement shall be in full
force and effect and the Company shall not be in breach of any representation,
warranty, covenant or agreement thereunder in any material respect.

 

(u)           Issuance
or Sale of Common Stock.  Neither the
Company nor any of its Subsidiaries shall have issued or sold any shares of
Common Stock (or securities, warrants or options that are convertible into or
exchangeable or exercisable for, or linked to the performance of, Common Stock)
(other than (A) pursuant to the Equity Exchange, (B) the issuance of
shares 

 

56

 

pursuant
to the exercise of employee stock options issued pursuant to the Company Option
Plans, (C) as set forth on Section 7.1(u) of the Company
Disclosure Letter or (D) the issuance of shares to existing holders of Common
Stock and the Backstop Investors, in each case, pursuant to Section 6.9),
unless (1) the purchase price (or, in the case of securities that are
convertible into or exchangeable or exercisable for, or linked to the
performance of, Common Stock, the conversion, exchange or exercise price) shall
not be less than $10.00 per share (net of all underwriting and other discounts,
fees and any other compensation; provided, that for purposes hereof,
payments to the Fairholme Investors or the Pershing Investors in accordance
with Section 1.4 of the Fairholme Agreement or the Pershing Agreement,
respectively, shall not be considered a discount, fee or other compensation),
(2) following such issuance or sale, (x) no Person (other than (i) Purchaser,
Brookfield Consortium Members, the Fairholme/Pershing Investors and their
respective Affiliates and (ii) any institutional underwriter or initial
purchaser acting in an underwriter capacity in an underwritten offering) shall,
after giving effect to such issuance or sale, beneficially own more than 10% of
the Common Stock of the Company on a Fully Diluted Basis, and (y) no four
Persons (other than Purchaser, Brookfield Consortium Members, the
Fairholme/Pershing Investors and their respective Affiliates) shall, after
giving effect to such issuance or sale, beneficially own more than thirty
percent (30%) of the Common Stock on a Fully Diluted Basis; provided,
that this clause (2) shall not be applicable to any conversion or exchange
of claims against the Debtors into New Common Stock pursuant to the Plan; provided,
further, that subclause (y) of this clause (2) shall not be
applicable with respect to any Person listed on Exhibit N and (3) Purchaser
shall have been offered the right to purchase up to 15% of such shares of
Common Stock (or securities, warrants or options that are convertible into or
exchangeable or exercisable for Common Stock) on terms otherwise consistent
with Section 5.9 (except the provisions of such Section 5.9
with respect to issuances contemplated by this Section 7.1(u) shall
apply from the date of this Agreement) (provided that the right
described in this clause (3) shall not be applicable to the issuance of
shares or warrants contemplated by the Fairholme/Pershing Agreements, or any
conversion or exchange of debt or other claims into equity in connection with
the Plan).

 

(v)           Hughes
Heirs Obligations.  The Hughes Heirs
Obligations shall have been determined by order of the Bankruptcy Court entered
on or prior to the Effective Date (which order may be the Confirmation Order or
another order entered by the Bankruptcy Court) and satisfied in accordance with
the terms of the Plan.  For the avoidance of doubt, to the extent that holders of Hughes Heirs
Obligations or other Claims against or interests in the Debtors arising under
or related to the Hughes Agreement receive any consideration in respect of such
obligations, Claims or interests under the Plan, there shall be no reduction in
the number of shares of New Common Stock or GGO Common Stock otherwise to have
been distributed on the Effective Date under the Plan in the Equity Exchange or
the GGO Share Distribution, as applicable.

 

(w)          GGO
Promissory Note.  The GGO Promissory
Note, if any, shall have been issued by GGO (or one of its Subsidiaries,
provided that the GGO Promissory Note is guaranteed by GGO) in favor of the
Operating Partnership.

 

57

 

ARTICLE VIII

 

CONDITIONS TO THE OBLIGATIONS OF
THE COMPANY

 

SECTION 8.1         Conditions
to the Obligations of the Company. 
The obligation of the Company to issue the Shares and the obligation of
GGO to issue the GGO Shares pursuant to this Agreement on the Closing Date are
subject to the satisfaction (or waiver by the Company) of the following
conditions as of the Closing Date:

 

(a)           No
Injunction.  No judgment, injunction,
decree or other legal restraint shall prohibit the consummation of the Plan or
the transactions contemplated by this Agreement.

 

(b)           Regulatory
Approvals; Consents.  All permits,
consents, orders, approvals, waivers, authorizations or other permissions or
actions of third parties and Governmental Entities required for the
consummation of the transactions contemplated by this Agreement and the Plan
shall have been made or received, as the case may be, and shall be in full
force and effect, except for those permits, consents, orders, approvals,
waivers, authorizations or other permissions or actions the failure of which to
make or receive would not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect.

 

(c)           Representations
and Warranties and Covenants.  Each of
(i) the representations and warranties of Purchaser contained in Section 4.1,
Section 4.2, Section 4.3, and Section 4.12
in this Agreement shall be true and correct at and as of the Closing Date as if
made at and as of the Closing Date (except for representations and warranties
made as of a specific date, which shall be true and correct only as of such
specific date), and (ii) the other representations and warranties of Purchaser
contained in this Agreement, disregarding all qualifications and exceptions
contained therein relating to “materiality”, shall be true and correct at and
as of the date of this Agreement and at and as of the Closing Date as if made
at and as of the Closing Date (except for representations and warranties made
as of a specified date, which shall be true and correct only as of the
specified date), except for such failures to be true and correct that,
individually or in the aggregate, would not reasonably be expected to have a
material adverse effect on the ability of Purchaser to consummate the
transactions contemplated by this Agreement. 
Purchaser shall have complied in all material respects with all of its
obligations under this Agreement. 
Purchaser shall have provided to the Company a certificate delivered by
an executive officer of the managing member of Purchaser, acting in his or her
official capacity on behalf of Purchaser, to the effect that the conditions in
this clause (c) have been satisfied as of the Closing Date.

 

(d)           Plan
and Confirmation Order.  The Plan
shall have been confirmed by the Bankruptcy Court by order, which order shall
be in full force and effect and not subject to a stay of effectiveness.

 

(e)           Conditions
to Confirmation.  The conditions to
confirmation and the conditions to the Effective Date of the Plan shall have
been satisfied or waived in accordance with the Plan.

 

(f)            GGO.  The GGO Share Distribution shall have
occurred.

 

58

 

(g)           No
Legal Impediment to Issuance.  No
action shall have been taken and no statute, rule, regulation or order shall
have been enacted, adopted or issued by any federal, state or foreign
governmental or regulatory authority that prohibits the issuance or sale of,
pursuant to this Agreement, the Shares, the issuance of Warrants, New Warrants,
GGO Shares, GGO Warrants, the issuance of New Common Stock upon exercise of the
New Warrants or the issuance of GGO Common Stock upon exercise of the GGO
Warrants; and no injunction or order of any federal, state or foreign court
shall have been issued that prohibits the issuance or sale, pursuant to this
Agreement, of the Shares, the GGO Shares, the Warrants, the New Warrants, GGO
Warrants, the issuance of New Common Stock upon exercise of the New Warrants or
the issuance of GGO Common Stock upon exercise of the GGO Warrants.

 

(h)           Reorganization
Opinion.  The Company shall have
received an opinion of Weil, Gotshal & Manges LLP, dated as of the
Closing Date, in form and substance reasonably satisfactory to the Company,
substantially to the effect that, on the basis of the facts, representations
and assumptions set forth in such opinion, the exchange of Common Stock for New
Common Stock in the Equity Exchange should be treated as a reorganization
within the meaning of Section 368(a) of the Code.  In rendering such opinion, Weil, Gotshal &
Manges LLP may require and rely upon representations and covenants made by the
parties to this Agreement.

 

(i)            IRS
Ruling.  The Company shall have
obtained a favorable written ruling from the United States Internal Revenue
Service confirming the qualification of the GGO Share Distribution and the
prerequisite internal spin-offs each as a “tax free spin-off” under the Code.

 

(j)            Funding.  Purchaser shall have paid to the Company and
GGO, as applicable, all amounts payable by Purchaser under Article I
and Article II of this Agreement, by wire transfer of immediately
available funds to such account or accounts as shall have been designated in
writing by the Company at least three (3) Business Days prior to the
Closing Date.

 

(k)           REIT
Matters.  The representations and
covenants set forth on Exhibit D in respect of Purchaser and, to
the extent applicable, its Affiliates, members, Affiliates of members or
designees, shall be true and correct in all material respects as of the Closing
Date as if made at and as of the Closing Date, it being understood that
Purchaser’s Affiliates, members or Affiliates of members shall be required to
provide such representations and covenants only if such Person beneficially
owns Common Stock or New Common Stock in excess of the relevant ownership limit
set forth in the certificate of incorporation of the Company or any stock or
other equity interest owned by such Person in a tenant of the Company would be
treated as constructively owned by Purchaser.

 

(l)            Non-Control
Agreement.  Purchaser shall have
entered into the Non-Control Agreement with the Company.  The Non-Control Agreement shall be in full
force and effect and Purchaser shall not be in breach of any representation,
warranty, covenant or agreement thereunder in any material respect.

 

(m)          GGO
Promissory Note.  The GGO Promissory
Note, if any, shall have been issued by GGO (or one of its Subsidiaries,
provided that the GGO Promissory Note is guaranteed by GGO) in favor of the
Operating Partnership.

 

59

 

ARTICLE IX

 

INDEMNIFICATION

 

SECTION 9.1         Indemnification.

 

(a)           Subject to Section 9.1(b),
the Company shall indemnify and hold harmless Purchaser, its members and
partners and their respective Affiliates, officers, directors, employees,
agents, advisors and controlling persons (each an “Indemnified Person”),
from and against any and all losses, claims, damages, liabilities and
reasonable expenses to which any such Indemnified Person may become subject, in
each case, to the extent arising solely and directly out of any claim,
challenge, litigation, investigation or proceeding initiated by a third party
with respect to cooperation and assistance provided by Purchaser to the Company
pursuant to Section 5.3(a) of this Agreement (but, for the
avoidance of doubt, not other transactions relating to the Plan), and to
reimburse such Indemnified Persons for any reasonable legal or other
out-of-pocket expenses as they incur in connection with investigating,
responding to or defending any of the foregoing.  Notwithstanding the foregoing or anything to
the contrary, the Company will not be responsible to indemnify or
reimburse any Indemnified Person for anything resulting from willful misconduct
or gross negligence of any Indemnified Person.

 

(b)           Promptly after receipt by an Indemnified Person of notice of the
commencement of any claim, litigation, investigation or proceeding for which
indemnification is provided pursuant to this Agreement (“Proceedings”),
Purchaser shall, if a claim is to be made hereunder against the Company in
respect thereof, notify the Company in writing of the commencement thereof;
provided that the omission so to notify the Company shall not relieve it from
any liability that it may have hereunder except to the extent it has been
materially prejudiced by such failure. 
In case any such Proceedings are brought against any Indemnified Person,
the Company shall be entitled to participate therein, and, to the extent that
it may elect by written notice delivered to Purchaser, to assume the defense
thereof, with counsel reasonably satisfactory to Purchaser, provided that if
the defendants in any such Proceedings include both such Indemnified Person and
the Company and such Indemnified Person shall have reasonably concluded based
on the advice of outside counsel that there are legal defenses available to it
that are different from or additional to those available to the Company such
that representation by counsel for the Company would involve a material
conflict of interest, such Indemnified Persons shall have the right to select
separate counsel to assert such legal defenses and to otherwise participate in
the defense of such Proceedings on behalf of such Indemnified Person.  The Company shall not be liable to any
Indemnified Person for legal expenses incurred by such Indemnified Person in
connection with the defense of any Proceeding unless (i) such Indemnified
Person shall have employed separate counsel in connection with the assertion of
legal defenses in accordance with the proviso to the preceding sentence (it
being understood, however, that the Company shall not be liable under either
this (i) or the following clause (ii) for the expenses of more than
one separate counsel representing the Indemnified Persons who are parties to
such Proceedings) or (ii) the Company shall not have employed counsel
reasonably satisfactory to Purchaser to represent such Indemnified Person within
a reasonable time after notice of commencement of the Proceedings.

 

60

 

(c)           The Company
shall not be liable for any settlement of any Proceedings effected without its
written consent (which consent shall not be unreasonably withheld).  If any settlement of any Proceeding is
consummated with the written consent of the Company or if there is a final
judgment for the plaintiff in any such Proceedings, the Company agrees to
indemnify and hold harmless each Indemnified Person from and against any and
all losses, claims, damages, liabilities and expenses by reason of such
settlement or judgment in accordance with, and subject to the limitations of,
the provisions of this Article IX. 
The Company shall not, without the prior written consent of an
Indemnified Person (which consent shall not be unreasonably withheld), effect
any settlement of any pending or threatened Proceedings in respect of which
indemnity is provided hereunder by such Indemnified Person unless such
settlement (i) includes an unconditional release of such Indemnified
Person from all liability on the claims that are (1) the subject matter of
such Proceedings and (2) subject to indemnification under this Article IX
and (ii) does not include any statement as to or any admission of fault,
culpability or a failure to act by or on behalf of any Indemnified Person.

 

ARTICLE X

 

SURVIVAL OF REPRESENTATIONS AND
WARRANTIES

 

SECTION 10.1       Survival of Representations and Warranties.  The representations and warranties made in
this Agreement shall survive the 
execution and delivery of this Agreement but shall terminate and be of
no further force and effect following the earlier of (i) the termination
of this Agreement in accordance with Article XI and (ii) the
Closing.

 

ARTICLE XI

 

TERMINATION

 

SECTION 11.1       Termination.  This Agreement and the
obligations of the parties hereunder shall terminate automatically without any
action by any party if (i) the Company has not filed the Approval Motion
within two Business Days following the date of this Agreement, (ii) the
Approval Order, in form and substance satisfactory to Purchaser, approving,
among other things, the issuance of the Warrants, is not entered by the
Bankruptcy Court on or prior to the date that is 43 days after the date of this
Agreement or (iii) if the Debtors withdraw the Approval Motion, in each of
cases (i), (ii) and (iii) unless Purchaser and the Company otherwise
agree in writing.  In addition, this
Agreement may be terminated and the transactions contemplated hereby may be
abandoned at any time prior to the Closing Date:

 

(a)           by mutual written consent of Purchaser and the
Company;

 

(b)           by Purchaser by written notice to the Company upon
the occurrence of any of the following events (which notice shall specify the
event upon which such termination is based):

 

(i)            if the Effective Date and
the purchase and sale contemplated by Article I have not occurred
by the Termination Date; provided, however, that the right to
terminate this Agreement under this Section 11.1(b)(i) shall
not be available to Purchaser if it has breached in any material respect its
obligations under this Agreement in any manner that 

 

61

 

shall have proximately caused the Closing Date not
to occur on or before the Termination Date;

 

(ii)           if any Bankruptcy Cases of
the Company or any Debtor which is a Significant Subsidiary shall have been
dismissed or converted to cases under chapter 7 of the Bankruptcy Code or if an
interim or permanent trustee or an examiner shall be appointed to oversee or
operate any of the Debtors in their Bankruptcy Cases, in each case, except (x) as
would not reasonably be expected to have a Material Adverse Effect or (y) with
respect to the Bankruptcy Cases for Phase II Mall Subsidiary, LLC, Oakwood
Shopping Center Limited Partnership and Rouse Oakwood Shopping Center, LLC;

 

(iii)          if, from and after the
issuance of the Warrants, the Approval Order shall without the prior written
consent of each Purchaser, cease to be in full force and effect resulting in
the cancellation of any Warrants or a modification of any Warrants, in each
case, other than pursuant to their terms, that adversely affects any Purchaser;

 

(iv)          if, without Purchaser’s
consent, the Warrants have not been issued to Purchaser in accordance with Section 5.2,
or if after the Warrants are issued, any shares of Common Stock underlying the
Warrants cease at any time to be authorized for issuance on a U.S. national
securities exchange;

 

(v)           if there has been a breach
by the Company of any representation, warranty, covenant or agreement of the
Company contained in this Agreement or the Company shall have taken any action
which, in each case, (A) would result in a failure of a condition set
forth in Article VII and (B) cannot be cured prior to the
Termination Date, after written notice to the Company of such breach and the
intention to terminate this Agreement pursuant to this Section; provided,
however, that the right to terminate this Agreement under this Section shall
not be available to Purchaser if it has breached in any material respect its
obligations under this Agreement;

 

(vi)          if the Company consummates a
Competing Transaction;

 

(vii)         if the Company or any
Subsidiary of the Company issues any shares of Common Stock or New Common Stock
(or securities convertible into or exchangeable or exercisable for Common Stock
or New Common Stock) at a purchase price (or in the case of securities that are
convertible into or exchangeable or exercisable for, or linked to the
performance of, Common Stock or New Common Stock, the conversion, exchange,
exercise or comparable price) of less than $10.00 per share (net of all
underwriting and other discounts, fees and any other compensation and related
expenses; provided, that for purposes hereof, payments to the Fairholme
Investors or the Pershing Investors in accordance with Section 1.4 of the
Fairholme Agreement or the Pershing Agreement, respectively, shall not be
considered a discount, fee or other compensation) of Common Stock or New Common
Stock or converts any claim against any of the Debtors into New Common Stock at
a conversion price less than $10.00 per share of Common Stock or New Common
Stock (in each case, other than pursuant to (A) the exercise, exchange or
conversion of Share Equivalents of the Company existing on the date of this
Agreement in accordance with the terms thereof as of the date of this
Agreement, (B) the Equity 

 

62

 

Exchange, (C) the issuance of shares upon the
exercise of employee stock options issued pursuant to the Company Option Plans,
(D) the issuance of shares as set forth on Section 7.1(u) of the
Company Disclosure Letter, or (E) the issuance of shares to existing
holders of Common Stock and the Backstop Investors, in each case, pursuant to Section 6.9;

 

(viii)        [Intentionally Omitted]

 

(ix)           if the Bankruptcy Court shall
have entered a final and non-appealable order denying confirmation of the Plan;

 

(x)            if this Agreement, including
the Plan Summary Term Sheet, or the Plan, is revised or modified (except as
otherwise permitted pursuant to this Agreement) by the Company or an order of
the Bankruptcy Court or other court of competent jurisdiction in a manner that
is unacceptable to Purchaser or a plan of reorganization with respect to the
Debtors involving the Transactions that is unacceptable to Purchaser is filed
by the Debtors with the Bankruptcy Court or another court of competent
jurisdiction;

 

(xi)           if any Governmental Entity
of competent jurisdiction shall have issued a final and nonappealable order
permanently enjoining or otherwise prohibiting the consummation of the
transactions contemplated by this Agreement (the “Closing Restraint”);

 

(xii)          prior to the issuance of the
Warrants, if the Company (A) makes a public announcement, enters into an
agreement or files any pleading or document with the Bankruptcy Court, in each
case, evidencing its decision to support any Competing Transaction, or the
Company or any Subsidiary of the Company enters into a definitive agreement
providing for a Competing Transaction or (B) the Company provides notice
to Purchaser of the Company’s or any of its Subsidiaries’ decision to enter
into a definitive agreement providing for a Competing Transaction pursuant to Section 5.7;
or

 

(c)           by the Company upon the occurrence of any of the
following events:

 

(i)            if the Effective Date and
the purchase and sale contemplated by Article I have not occurred
by the Termination Date; provided, however, that the right to
terminate this Agreement under this Section 11.1(c)(i) shall
not be available to the Company to the extent that it has breached in any material
respect its obligations under this Agreement in any manner that shall have
proximately caused the Closing Date not to occur on or before the Termination
Date (it being agreed that this proviso shall not limit the Company’s ability
to terminate this Agreement pursuant to Section 11.1(c)(ii) or
any other clause of this Section 11.1(c));

 

(ii)           prior to the entry of the
Confirmation Order, upon notice to Purchaser, for any reason or no reason,
effective as of such time as shall be specified in such notice; provided,
however, that prior to the entry of the Approval Order, the Company shall not
have the right to terminate this Agreement under this Section 11.1(c)(ii) during
the 48 hour notice period contemplated by Section 5.7;

 

63

 

(iii)          if all conditions to the
obligations of Purchaser to consummate the transactions contemplated by this
Agreement set forth in Article VII shall have been satisfied (other
than those conditions that are to be satisfied (and capable of being satisfied)
by action taken at the Closing if Purchaser had complied with its obligations
under this Agreement) and the transactions contemplated by this Agreement fail
to be consummated as a result of the failure of Purchaser to have paid to the
Company and GGO, as applicable, all amounts payable by Purchaser under Article I
and Article II of this Agreement, by wire transfer of immediately
available funds in accordance with the terms of this Agreement;

 

(iv)          if as of the twentieth
(20th) day (or if this twentieth (20th) day is not a Business Day the next Business Day
following the date of this Agreement), Purchaser has not (i) received an
executed equity commitment from Brookfield Asset Management Inc. (the “Brookfield
Equity Commitment Letter”) in the form attached hereto as Exhibit K
and (ii) either (A) entered into escrow agreements with members of
Purchaser (each an “Equity Provider”) in the form attached hereto as Exhibit L
(each an “Escrow Agreement”, and together, the “Escrow Agreements”)
pursuant to which such members of Purchaser shall have deposited into an escrow
account with Deutsche Bank National Trust Company such funds that when taken
together with the commitment contemplated by the Brookfield Equity Commitment
Letter shall be sufficient in the aggregate to pay the Purchase Price and the
GGO Purchase Price, or (B) such members of Purchaser shall have
established one or more Acceptable LCs (as defined in the Escrow Agreements) in
lieu of one or more of the escrow accounts contemplated by the Escrow
Agreements; or

 

(v)           if a Closing Restraint is in
effect.

 

SECTION 11.2       Effects of Termination.

 

(a)           In the event of the termination of this Agreement
pursuant to Article XI, this Agreement shall forthwith become void
and there shall be no liability or obligation on the part of any party hereto
except after the entry of the Approval Order the covenants and agreements made
by the parties herein under Section 5.1(c), Section 5.14(a),
Article IX and in all circumstances Article XIII shall
survive indefinitely in accordance with their terms.  Except as otherwise expressly provided in the
Warrants or paragraph (b) below, the Warrants when issued in accordance
with Section 5.2 hereof and all obligations of the Company under
the Warrant Agreement shall survive any termination of this Agreement.

 

(b)           In the event of a termination of this Agreement by
the Company pursuant to Section 11.1(c)(iii), the Warrants shall
automatically be canceled, shall no longer be outstanding or capable of
exercise and shall cease to exist.  The
foregoing shall be a term of the Warrants.

 

64

 

ARTICLE XII

 

DEFINITIONS

 

SECTION 12.1       Defined Terms.  For purposes of this Agreement, the following
terms, when used in this Agreement with initial capital letters, shall have the
respective meanings set forth in this Agreement:

 

(a)           “2006 Bank Loan” means that certain Second
Amended and Restated Credit Agreement, dated as of February 24, 2006, by
and among the Company, the Operating Partnership and GGPLP L.L.C., as
borrowers, the lenders named therein, Banc of America Securities LLC, Eurohypo
AG, New York Branch and Wachovia Capital Markets, LLC, as joint arrangers and
joint bookrunners, Eurohypo AG, New York Branch, as administrative agent, Bank
of America, N.A. and Wachovia Bank, National Association, as syndication
agents, and Commerzbank AG and Lehman Commercial Paper, Inc., as
co-documentation agents.

 

(b)           “Additional Sales Period” means in the case
of Section 5.9(a)(iv)(A), the 120 day period following the date of
the Company’s notice to Purchaser pursuant to Section 5.9(a)(ii),
and in the case of Section 5.9(a)(iv)(B), the 120 day period
following (x) the expiration of the 180 day period specified in Section 5.9(a)(iii) or
(y) if earlier, the date on which it is finally determined that Purchaser
is unable to consummate such purchase contemplated by Section 5.9(a)(iii) within
such 180 day period specified in Section 5.9(a)(iii).

 

(c)           “Affiliate” of any particular Person means
any other Person controlling, controlled by or under common control with such
particular Person.  For the purposes of
this definition, “control” means the possession, directly or indirectly, of the
power to direct the management and policies of a Person whether through the
ownership of voting securities, contract or otherwise.

 

(d)           “Brazilian Entities” means those certain
Persons in which the Company indirectly owns an interest which own real
property assets or have operations located in Brazil.

 

(e)           “Brookfield Consortium Member” means
Brookfield Asset Management Inc. or any controlled Affiliate of Brookfield
Asset Management Inc. or any Person of which Brookfield Asset Management Inc.
or any Subsidiary or controlled Affiliate of Brookfield Asset Management Inc.
is a general partner, managing member or equivalent thereof or a wholly owned
subsidiary of the foregoing.

 

(f)            “Business Day” means any day other than (a) a
Saturday, (b) a Sunday, (c) any day on which commercial banks in New
York, New York are required or authorized to close by Law or executive order.

 

(g)           “Cash Equivalents” means as to any Person,
(a) securities issued or directly and fully guaranteed or insured by the
United States or any agency or instrumentality thereof (provided,
that the full faith and credit of the United States is pledged in support
thereof) having maturities of not more than 90 days from the date of
acquisition by such Person, (b) time deposits and certificates of deposit
of any commercial bank having, or which is the principal banking subsidiary of
a bank holding company organized under the Laws of the United States, 

 

65

 

any
State thereof or the District of Columbia having capital, surplus and undivided
profits aggregating in excess of $500,000,000, having maturities of not more
than 90 days from the date of acquisition by such Person, (c) repurchase
obligations with a term of not more than 90 days for underlying securities of
the types described in subsection (a) above entered into with any
bank meeting the qualifications specified in subsection (b) above,
(d) commercial paper issued by any issuer rated at least A-1 by S&P or
at least P-1 by Moody’s or carrying an equivalent rating by a nationally
recognized rating agency, if both of the two named rating agencies cease
publishing ratings of commercial paper issuers generally, and in each case
maturing not more than one year after the date of acquisition by such Person or
(e) investments in money market funds substantially all of whose assets
are comprised of securities of the types described in subsections (a) through
(d) above.

 

(h)           “Claims” shall have the meaning set forth in
section 101(5) of the Bankruptcy Code.

 

(i)            “Closing Date Net Debt” means, as of the
Effective Date but prior to giving effect to the Plan, the sum of, without
duplication:

 

(i)            the aggregate
outstanding Proportionally Consolidated Debt plus any accrued and unpaid
interest thereon plus the amount of the New Debt,

 

(ii)           less the
Reinstatement Adjustment Amount,

 

(iii)          plus the
Permitted Claims Amount,

 

(iv)          plus the amount
of Proportionally Consolidated Debt attributable to assets of the Company, its
Subsidiaries and other Persons in which the Company, directly or indirectly,
holds a minority interest sold, returned, abandoned, conveyed, transferred or
otherwise divested during the period between the date of this Agreement and
through the Closing, but excluding any deficiency, guaranty or other similar
claims associated with the Special Consideration Properties (as such term is
defined in the plan of reorganization for the applicable Confirmed Debtor),

 

(v)           less
Proportionally Consolidated Unrestricted Cash; provided, however, that the net
proceeds attributable to sales of assets of the Company, its Subsidiaries and
other Persons in which the Company, directly or indirectly, holds a minority
interest sold, returned, abandoned, conveyed, or otherwise transferred during
the period between the date of this Agreement and through the Closing shall be
deducted prior to subtracting Proportionally Consolidated Unrestricted Cash.

 

(j)            “Closing Date Net Debt W/O Reinstatement
Adjustment and Permitted Claims Amounts” means, as of the Effective Date
but prior to giving effect to the Plan, the sum of, without duplication:

 

(i)            the aggregate
outstanding Proportionally Consolidated Debt plus any accrued and unpaid
interest thereon plus the amount of the New Debt,

 

66

 

(ii)           plus the amount
of Proportionally Consolidated Debt attributable to assets of the Company, its
Subsidiaries and other Persons in which the Company, directly or indirectly,
holds a minority interest sold, returned, abandoned, conveyed, transferred or
otherwise divested during the period between the date of this Agreement and
through the Closing, but excluding any deficiency, guaranty or other similar
claims associated with the Special Consideration Properties (as such term is
defined in the plan of reorganization for the applicable Confirmed Debtor), and

 

(iii)          less Proportionally
Consolidated Unrestricted Cash; provided, however, that the net proceeds
attributable to sales of assets of the Company, its Subsidiaries and other
Persons in which the Company, directly or indirectly, holds a minority interest
sold, returned, abandoned, conveyed, or otherwise transferred during the period
between the date of this Agreement and through the Closing shall be deducted
prior to subtracting Proportionally Consolidated Unrestricted Cash.

 

(k)           “Company Benefit Plan” means each “employee
benefit plan” within the meaning of Section 3(3) of ERISA and each
other stock purchase, stock option, restricted stock, severance, retention,
employment, consulting, change-of-control, collective bargaining, bonus,
incentive, deferred compensation, employee loan, fringe benefit and other
benefit plan, agreement, program, policy, commitment or other arrangement,
whether or not subject to ERISA (including any related funding mechanism now in
effect or required in the future), whether formal or informal, oral or written,
in each case sponsored or maintained by the Company or any of its Significant
Subsidiaries for the benefit of any past or present director, officer,
employee, consultant or independent contractor of the Company or any of its
Significant Subsidiaries has any present or future right to benefits.

 

(l)            “Company Board” means the board of directors
of the Company.

 

(m)          “Competing Transaction”  means, other than the transactions
contemplated by this Agreement or the Plan Summary Term Sheet, or by the Fairholme/Pershing
Agreements, any offer or proposal relating to (i) a merger, consolidation,
business combination, share exchange, tender offer, reorganization,
recapitalization, liquidation, dissolution or similar transaction involving the
Company or (ii) any direct or indirect purchase or other acquisition by a
“person” or “group” of “beneficial ownership” (as used for purposes of
Section 13(d) of the Exchange Act) of, or a series of transactions to
purchase or acquire, assets representing 30% or more of the consolidated assets
or revenues of the Company and its Subsidiaries taken as a whole or 30% or more
of the Common Stock of the Company (or securities convertible into or
exchangeable or exercisable for 30% or more of the Common Stock of the Company)
or (iii) any recapitalization of the Company or the provision of financing
to the Company that shall cause any condition in Section 7.1 not to
be satisfied, in each case, other than the recapitalization and financing
transactions contemplated by this Agreement and the Plan Summary Term Sheet (or
the financing provided by the Fairholme/Pershing Investors pursuant to the
Fairholme/Pershing Agreements) or that will be effected together with the
transactions contemplated hereby.

 

67

 

(n)           “Conclusive Net Debt Adjustment Statement”
means a statement that:  (i) sets
forth each of the five components of the Closing Date Net Debt (for the
avoidance of doubt, this shall include (x) the Permitted Claims Amount,
which shall include the Reserve, (y) the Reinstatement Adjustment Amount,
and (z) with respect to clauses (i), (iv) and (v) of the
definition of Closing Date Net Debt, the Closing Date Net Debt Amount W/O
Reinstatement Adjustment and Permitted Claims Amounts as determined through the
process provided for in this Agreement shall be used), and (ii) sets forth
the Net Debt Excess Amount or the Net Debt Surplus Amount, as applicable.

 

(o)           “Contract” means any agreement, lease,
license, evidence of indebtedness, mortgage, indenture, security agreement or
other contract.

 

(p)           [Intentionally Omitted.]

 

(q)           “Corporate Level Debt” means the debt
described in Sections II A, H through O, Q, R, S, W and X of the Plan Summary
Term Sheet plus accrued and unpaid interest thereon.

 

(r)            “Debt” means all obligations of the Company,
its Subsidiaries and other Persons in which the Company, directly or
indirectly, holds a minority interest (a) evidenced by (i) notes,
bonds, debentures or other similar instruments (including, for avoidance of doubt,
mezzanine debt), or (ii) trust preferred shares, trust preferred units and
other preferred instruments, and/or (b) secured by a lien, mortgage or
other encumbrance; provided, however, that Debt shall exclude
(x) any form of municipal financing including, but not limited to, special
improvement district bonds or tax increment financing, (y) an agreement
for the use or possession of property creating obligations that do not appear
on the balance sheet of such Person but which, upon the insolvency or bankruptcy
of such Person, would be characterized as the indebtedness of such Person
(without regard to accounting treatment), and (z) intercompany notes or
preferred interests between and among the Company and its wholly owned
Subsidiaries.

 

(s)           “DIP Loan” means that certain Senior Secured
Debtor in Possession Credit, Security and Guaranty Agreement, dated as of May 15,
2009, by and among the lenders named therein, UBS AG, Stamford Branch, as
administrative agent for the lenders, the Company and the Operating Partnership,
as borrowers, and the certain subsidiaries of the Company named therein, as
guarantors.

 

(t)            “Disclosure Statement” means the disclosure
statement to accompany the Plan as amended, modified or supplemented.

 

(u)           “ERISA” means the Employee Retirement Income
Security Act of 1974, as amended.

 

(v)           “Excess Surplus Amount” means the sum
of:  (i) if, after giving effect to
the application of the Reserve Surplus Amount to reduce the principal amount of
the GGO Promissory Note pursuant to Section 5.17(d), any Reserve
Surplus Amount remains, (A) if and to the extent that such Reserve Surplus
Amount is less than or equal to the Net Debt Surplus Amount, 80% of such
remaining Reserve Surplus Amount, and otherwise (B) 100% of the remaining
Reserve Surplus Amount; and (ii) (A) if a GGO Promissory Note is
required to be issued at Closing, 80% of the aggregate Offering Premium, if
any, less the amount of any 

 

68

 

reduction
in the principal amount of the GGO Promissory Note pursuant to Section 5.17(e) hereof,
or (B) if the GGO Promissory Note is not required to be issued at Closing,
the sum of (x) 80% of the aggregate Offering Premium and (y) 80% of
the excess, if any, of the Net Debt Surplus Amount over the Hughes Amount.

 

(w)          “Exchangeable Notes” means the 3.98%
Exchangeable Senior Notes Due 2027 issued pursuant to that certain Indenture,
dated as of April 16, 2007, by and between the Operating Partnership, as
issuer, and The Bank of New York Mellon Corporation, as trustee.

 

(x)            “Excluded Claims” means:

 

(i)            prepetition and
postpetition Claims secured by cashiers’, landlords’, workers’, mechanics’,
carriers’, workmen’s, repairmen’s and materialmen’s liens and other similar
liens,

 

(ii)           except with
respect to Claims related to GGO or the assets or businesses contributed
thereto, prepetition and postpetition Claims for all ordinary course trade
payables for goods and services related to the operations of the Company and
its Subsidiaries (including, without limitation, ordinary course obligations to
tenants, anchors, vendors, customers, utility providers or forward contract
counterparties related to utility services, employee payroll, commissions,
bonuses and benefits (but excluding the Key Employee Incentive Plan approved by
the Bankruptcy Court pursuant to an order entered on October 15, 2009 at
docket no. 3126), insurance premiums, insurance deductibles, self insured
amounts and other obligations that are accounted for, consistent with past
practice prior to the Petition Date, as trade payables); provided, however,
that Claims or expenses related to the administration and conduct of the
Bankruptcy Cases (such as professional fees and disbursements of financial,
legal and other advisers and consultants retained in connection with the
administration and conduct of the Company’s and its Subsidiaries’ Bankruptcy
Cases and other expenses, fees and commissions related to the reorganization
and recapitalization of the Company pursuant to the Plan, including related to
this Agreement, the Pershing/Fairholme Agreements, the issuance of the New
Debt, Liquidity Equity Issuances and any other equity issuances contemplated by
this Agreement and the Plan) shall not be Excluded Claims,

 

(iii)          except with
respect to Claims related to GGO or the assets or businesses contributed
thereto, Claims and liabilities arising from the litigation or potential
litigation matters set forth in that certain Interim Litigation Report of the
Company dated March 29, 2010 and the Company’s litigation audit response
to Deloitte & Touche dated February 25, 2010, both have been made
available to Purchaser prior to close of business on March 29, 2010 and
other Claims and liabilities arising from ordinary course litigation or
potential litigation that was not included in such schedule solely because the
amount of estimated or asserted liabilities or 

 

69

 

Claims did not meet the threshold amount used for
the preparation of such schedule, in each case, to the extent that such Claims
and liabilities have not been paid and satisfied as of the Effective Date, are
continuing following the Effective Date, excluding Claims against or interests
in the Debtors arising under or related to the Hughes Agreement,

 

(iv)          except with
respect to Claims related to GGO or the assets or businesses contributed
thereto, all tenant, anchor and vendor Claims required to be cured pursuant to
section 365 of the Bankruptcy Code, in connection with the assumption of an
executory contract or unexpired lease under the Plan,

 

(v)           any deficiency,
guaranty or other similar Claims associated with the Special Consideration
Properties (as such term is defined in the plans of reorganization for the
applicable Confirmed Debtors),

 

(vi)          MPC Taxes,

 

(vii)         surety bond
Claims relating to Claims of the type identified in clauses (i) through
(vi) of this definition,

 

(viii)        GGO Setup Costs
(other than professional fees and disbursements of financial, legal and other
advisers and consultants retained in connection with the administration and
conduct of the Company’s and its Subsidiaries’ Bankruptcy Cases), and

 

(ix)           any liabilities
assumed by GGO and paid on the Effective Date by GGO or to be paid after the
Effective Date by GGO (for avoidance of doubt, this includes any Claims that,
absent assumption of the liability by GGO, would be a Permitted Claim).

 

(y)           “Fully Diluted Basis” means all outstanding
shares of the Common Stock, New Common Stock or GGO Common Stock, as
applicable, assuming the exercise of all outstanding Share Equivalents (other
than (x) any options issued to an employee of the Company or its
Subsidiaries pursuant to the terms of a Company Benefit Plan or to an employee
of GGO or its Subsidiaries pursuant to the terms of an employee equity plan of
GGO or (y) preferred UPREIT Units) without regard to any restrictions or
conditions with respect to the exercisability of such Share Equivalents.

 

(z)            “GAAP” means generally accepted accounting
principles in the United States.

 

(aa)         “GGO Common Share Amount” means 32,468,326
plus a number (rounded up to the nearest whole number) equal to 0.1 multiplied
by the number of shares of Common Stock issued on or after the Measurement Date
and prior to the record date of the GGO Share Distribution as a result of the exercise,
conversion or exchange of any Share Equivalents of the Company outstanding on
the Measurement Date into Common Stock and employee stock options issued
pursuant to the Company Option Plans.

 

70

 

(bb)         “GGO
Note Amount” means:  (i) in the
event there is a Net Debt Excess Amount, the sum of the Net Debt Excess Amount
set forth on the Conclusive Net Debt Adjustment Statement and the Hughes Heirs
Obligations to the extent satisfied with assets of the Company (including cash
(but excluding any cash paid prior to the Effective Date in settlement or
satisfaction of Hughes Heirs Obligations which had the effect of reducing
Proportionally Consolidated Unrestricted Cash for purposes of calculating
Closing Date Net Debt, Closing Date Net Debt W/O Reinstatement Adjustment and
Permitted Claims Amounts, and Net Debt Excess Amount/Net Debt Surplus Amount,
as applicable) or shares of New Common Stock, but excluding Identified Assets)
(such amount so satisfied, the “Hughes Amount”); and (ii) in the
event there is a Net Debt Surplus Amount, the Hughes Amount less 80% of the Net
Debt Surplus Amount, provided, that in no event shall the GGO Note Amount be
less than zero.

 

(cc)         “GGO
Promissory Note” means an unsecured promissory note payable by GGO (or one
of its Subsidiaries, provided that the GGO Promissory Note is guaranteed by
GGO) in favor of the Operating Partnership in the aggregate principal amount of
the GGO Note Amount, as adjusted pursuant to Section 5.17(d), Section 5.17(e) and
Section 5.17(g), (i) bearing interest at a rate equal to the
lower of (x) 7.5% per annum and (y) the weighted average effective
rate of interest payable (after giving effect to the payment of any
underwriting and all other discounts, fees and any other compensation) on each
series of New Debt issued in connection with the Plan and (ii) maturing on
the fifth anniversary of the Closing Date (or if such date is not a Business
Day, the next immediately following Business Day), and (iii) including
prohibitions on dividends and distributions, no financial covenants and such
other customary terms and conditions as reasonably agreed to by Purchaser and
the Company.

 

(dd)         [Intentionally
Omitted.]

 

(ee)         “GGO
Setup Costs” means such cash liabilities, costs and expenses as may be
incurred by the Company or its Subsidiaries in connection with the formation
and organization of GGO and the implementation of the GGO Share Distribution,
including any and all liabilities for any sales, use, stamp, documentary,
filing, recording, transfer, gross receipts, registration, duty, securities
transactions or similar fees or Taxes or governmental charges (together with
any interest or penalty, addition to Tax or additional amount imposed) as
levied by any taxing authority, in each case, determined as of the Effective
Date and further including, to the extent the Company or any Subsidiary of the
Company has made or will make a payment to reduce the principal amount of the
mortgage related to 110 N. Wacker Drive, Chicago, Illinois, then 50% of
any such payment or contractual obligation to make a payment.

 

(ff)           [Intentionally
Omitted.]

 

(gg)         “Governmental
Entity” means any (a) nation, region, state, province, county, city,
town, village, district or other jurisdiction, (b) federal, state, local,
municipal, foreign or other government, (c) governmental or
quasi-governmental authority of any nature (including any governmental agency,
branch, department, court or tribunal, or other entity), (d) multinational
organization or body or (e) body entitled to exercise any administrative,
executive, judicial, legislative, police, regulatory or taxing authority or
power of any nature or any other self-regulatory organizations.

 

71

 

(hh)         “Hughes
Agreement” means that certain Contingent Stock Agreement, effective as of
January 1, 1996, by The Rouse Company in favor of and for the benefit of
the Holders (named in Schedule I thereto) and the Representatives (therein
defined), as amended.

 

(ii)           “Hughes
Heirs Obligations” means claims or interests against the Debtors arising
under or relating to sections 2.07 and 2.08 of the Hughes Agreement and
pertaining to the delivery of contingent shares for business units to be valued
as of December 31, 2009 and claims arising out of or related to the
foregoing.

 

(jj)           “Indebtedness”
means, with respect to a Person
without duplication, (a) all indebtedness of such Person for borrowed
money, (b) all obligations of such Person for the deferred purchase price
of property (other than trade payables and accrued expenses incurred in the
ordinary course of such Person’s business), (c) all obligations of such
Person evidenced by notes, bonds, debentures or other similar instruments,
trust preferred shares, trust preferred units and other preference instruments,
(d) all indebtedness created or arising under any conditional sale or
other title retention agreement with respect to property acquired by such
Person (even though the rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession or sale of such
property), (e) all obligations in respect of capital leases under GAAP of
such Person, (f) all obligations of such Person, contingent or otherwise,
as an account party or applicant under acceptance, letter of credit, surety
bond or similar facilities, (g) the monetary obligations of
a Person under (x) a so-called synthetic, off-balance sheet or tax
retention lease, or (y) an agreement for the use or possession of property
creating obligations that do not appear on the balance sheet of such Person but
which, upon the insolvency or bankruptcy of such Person, would be characterized
as the indebtedness of such Person (without regard to accounting treatment)
(each, a “Synthetic Lease Obligation”),
(h) guaranties of such Person with respect to obligations of the type
described clauses (a) through (g) above, (i) all obligations of
other Persons of the kind referred to in clauses (a) through
(h) above secured by any lien on property owned by such Person, whether or
not such Person has assumed or become liable for the payment of such
obligation, (j) the net obligations of such Person in respect of hedge
agreements and swaps and (k) any obligation that, in accordance with GAAP,
would be required to be reflected as debt on the consolidated balance sheet of
such Person.

 

(kk)         “Joint
Venture” means a Subsidiary of the Company which is owned partly by another
Subsidiary of the Company and partly by a third party.

 

(ll)           “Knowledge”
of the Company means the actual knowledge, as of the date of this Agreement, of
the individuals listed on Section 12.1(ll) of the Company Disclosure
Letter.

 

(mm)       “Law”
means any statutes, laws (including common law), rules, ordinances,
regulations, codes, orders, judgments, decisions, injunctions, writs, decrees,
applicable to the Company or any of its Subsidiaries or Purchaser, as
applicable, or their respective properties or assets.

 

(nn)         “Liquidity
Equity Issuances” means issuances of shares of New Common Stock in the Plan
for cash in an aggregate amount of up to 65,000,000 shares of New Common Stock.

 

72

 

(oo)         “Material
Adverse Effect” means any change, event or occurrence which (x) has a
material adverse effect on the results of operations or financial condition of
the Company and its direct and indirect Subsidiaries taken as a whole, other
than changes, events or occurrences (i) generally affecting (A) the
retail mall industry in the United States or in a specific geographic area in
which the Company operates, or (B) the economy, or financial or capital
markets, in the United States or elsewhere in the world, including changes in
interest or exchange rates or the availability of capital, or (ii) arising
out of, resulting from or attributable to (A) changes in Law or regulation
or in generally accepted accounting principles or in accounting standards, or
changes in general legal, regulatory or political conditions, (B) the
negotiation, execution, announcement or performance of any agreement between
the Company and/or its Affiliates, on the one hand, and Purchaser and/or its
Affiliates, on the other hand, or the consummation of the transactions
contemplated hereby or operating performance or reputational issues arising out
of or associated with the Bankruptcy Cases, including the impact thereof on
relationships, contractual or otherwise, with tenants, customers, suppliers,
distributors, partners or employees, or any litigation or claims arising from
allegations of breach of fiduciary duty or violation of Law or otherwise,
related to the execution or performance of this Agreement or the transactions
contemplated hereby, including, without limitation, any developments in the
Bankruptcy Cases, (C) acts of war, sabotage or terrorism, or any
escalation or worsening of any such acts of war, sabotage or terrorism
threatened or underway as of the date of the this Agreement,
(D) earthquakes, hurricanes, tornadoes or other natural disasters,
(E) any action taken by the Company or its Subsidiaries as contemplated or
permitted by any agreement between the Company and/or its Affiliates, on the
one hand, and Purchaser and/or its Affiliates, on the other hand, or with
Purchaser’s consent, or any failure by the Company to take any action as a
result of any restriction contained in any agreement between the Company and/or
its Affiliates, on the one hand, and Purchaser and/or its Affiliates, on the
other hand, or (F) in each case in and of itself, any decline in the
market price, or change in trading volume, of the capital stock or debt
securities of the Company or any direct or indirect subsidiary thereof, or any
failure to meet publicly announced or internal revenue or earnings projections,
forecasts, estimates or guidance for any period, whether relating to financial
performance or business metrics, including, without limitation, revenues, net
operating incomes, cash flows or cash positions, it being further understood
that any event, change, development, effect or occurrence giving rise to such
decline in the trading price or trading volume of the capital stock or debt
securities of the Company or such failure to meet internal projections or
forecasts as described in the preceding clause (F), as the case may be, may be
the cause of a Material Adverse Effect; so long as, in the case of clauses
(i)(A) and (i)(B), such changes or events do not have a materially
disproportionate adverse effect on the Company and its Subsidiaries, taken as a
whole, as compared to other entities that own and manage retail malls
throughout the United States, or (y) materially impairs the ability of the
Company to consummate the transactions contemplated by this Agreement or
perform its obligations hereunder or under the other agreements executed in connection
with the transactions contemplated hereby.

 

(pp)         “Material
Contract” means, with respect to the Company and its Subsidiaries, any:

 

(i)                                     Contract that
would be considered a material contract pursuant to Item 601(b)(10) of
Regulation S-K promulgated by the SEC, had the Company been the registrant
referred to in such regulation; or

 

73

 

(ii)                                  Contract for
capital expenditures, the future acquisition or construction of fixed assets or
the future purchase of materials, supplies or equipment that provides for the
payment by the Company or its Subsidiaries of more than $5,000,000 and is not
terminable by the Company or any of its Subsidiaries by notice of not more than
sixty (60) days for a cost of less than $1,000,000.

 

(qq)         “MPC
Assets” means residential and commercial lots in the “master planned
communities” owned by the Howard Hughes Corporation or The Hughes
Corporation or related to the Emerson Master Planned Community.

 

(rr)           “MPC
Taxes” means all liability for income Taxes in respect of sales of MPC
Assets sold prior to the date of this Agreement.

 

(ss)         [Intentionally
Omitted.]

 

(tt)           “Net
Debt Excess Amount” means, the amount, which shall in no event be less than
$0, that is calculated by subtracting the Target Net Debt from the Closing Date
Net Debt (as reflected on the Conclusive Net Debt Adjustment Statement).

 

(uu)         “Net
Debt Surplus Amount” means, the amount, which shall in no event be less
than $0, that is calculated by subtracting Closing Date Net Debt (as reflected
on the Conclusive Net Debt Adjustment Statement) from the Target Net Debt.

 

(vv)         “Non-Control
Agreement” means the Non-Control Agreement the form of which is attached
hereto as Exhibit M.

 

(ww)       “Non-Controlling
Properties” means the Company Properties listed on Section 12.1(ww)
of the Company Disclosure Letter.  Each
of the Non-Controlling Properties is owned by a Joint Venture in which neither
the Company nor any of its Subsidiaries is a controlling entity.  For purposes of this Section 12.1(ww),
the term “control” shall mean, possession, directly or indirectly, of the power
to direct the management and policies of a Person whether through the ownership
of voting securities, contract or otherwise; provided, however, that the rights
of any Person to exercise Major Decision Rights under a Joint Venture shall not
constitute or be deemed to constitute “control” for the purposes hereof.  “Controlling” and “controlled” shall have
meanings correlative thereto.  For
purposes of this Section 12.1(ww), the term “Major Decision Rights”
shall mean, the right to, directly or indirectly, approve, consent to, veto or
exercise a vote in connection with a Person’s voting or other decision-making
authority in respect of the collective rights, options, elections or obligations
of such Person under a Joint Venture.

 

(xx)          “Offering
Premium” means, with respect to any shares of New Common Stock issued for
cash in conjunction with issuances of New Common Stock or Share Equivalents permitted by this Agreement (including any Liquidity
Equity Issuance) and completed prior to the date
that is the last to occur of (x) 45 days after the Effective Date,
(y) the Settlement Date (as defined in the Pershing Agreement), if
applicable, and (z) the Bridge Note Maturity Date (as defined in the
Pershing Agreement), if applicable, the product of
(i) (A) the per share offering price of the shares of New Common
Stock (or offering price of Share Equivalents
corresponding

 

74

 

to one underlying share of New Common Stock) issued
(net of all underwriting and other discounts, fees or other compensation, and
related expenses) less (B) the Per Share Purchase Price and (ii) the
number of shares of New Common Stock sold pursuant thereto.  For the purposes hereof, the issuance for
cash of notes mandatorily convertible into New Common Stock on the Effective
Date shall constitute an issuance of the underlying number of shares of New
Common Stock for cash at a price per share offering equal to the offering price
for the corresponding amount of notes.

 

(yy)         “Operating
Partnership” means GGP Limited Partnership, a Delaware limited partnership
and a Subsidiary of the Company.

 

(zz)          “Permitted
Claims” means, as of the Effective Date, other than Excluded Claims,
(a) all Claims against the Debtors covered by the Plan (the “Plan
Debtors”) that are classified in those certain classes of Claims described
in Sections II B through E, G and P in the Plan Summary Term Sheet (the “PMA
Claims”), (b) all Claims or other amounts required to be paid pursuant
to the Plan to indenture trustees or similar servicing or administrative
agents, with respect to administrative fees incurred by or reimbursement
obligations owed to such indenture trustees or similar servicing or administrative
agents in their capacity as such under the Corporate Level Debt documents,
(c) any claims of a similar type as the PMA Claims that are or have been
asserted against affiliates of the Plan Debtors that are or were debtors in the
Bankruptcy Cases and for which a plan of reorganization has already been
confirmed (the “Confirmed Debtors”), (d) Claims or interests
against the Debtors arising under or related to the Hughes Agreement (other
than Hughes Heirs Obligations) and (e) surety bond Claims relating to the
types of Claims identified in clauses (a) through (d) of this
definition.

 

(aaa)       “Permitted
Claims Amount” means, as of the Effective Date, an amount equal to the sum
of, without duplication, (a) the aggregate amount of accrued and unpaid
Permitted Claims that have been allowed (by order of the Bankruptcy Court or
pursuant to the terms of the Plan) as of the Effective Date, plus (b) the
aggregate amount of the reserve to be estimated pursuant to the Plan with
respect to accrued and unpaid Permitted Claims that have not been allowed or
disallowed (in each case by order of the Bankruptcy Court or pursuant to the
terms of the Plan) as of the Effective Date (the “Reserve”), plus
(c) the aggregate amount of the GGO Setup Costs (other than professional
fees and disbursements of financial, legal and other advisers and consultants
retained in connection with the administration and conduct of the Company’s and
its Subsidiaries’ Bankruptcy Cases) as of the Effective Date; provided, however,
that there shall be no duplication with any amounts otherwise included in
Closing Date Net Debt.

 

(bbb)      “Person”
means an individual, a group (including a “group” under
Section 13(d) of the Exchange Act), a partnership, a corporation, a
limited liability company, an association, a joint stock company, a trust, a
joint venture, an unincorporated organization and a Governmental Entity or any
department, agency or political subdivision thereof.

 

(ccc)       “Preliminary
Closing Date Net Debt Review Deadline” means the end of the Preliminary Closing
Date Net Debt Review Period, which date shall be the first business day that is
at least twenty (20) calendar days after delivery of the Preliminary Closing
Date Net Debt Schedule, and which shall be the deadline by which Purchaser
shall deliver to the Company a Dispute Notice.

 

75

 

(ddd)      “Preliminary
Closing Date Net Debt Review Period” means the period between the Company’s
delivery of the Preliminary Closing Date Net Debt Schedule and the Preliminary
Closing Date Net Debt Review Deadline.

 

(eee)       “Proportionally
Consolidated Debt” means consolidated Debt of the Company less (1) all
Debt of Subsidiaries of the Company that are not wholly-owned and other Persons
in which the Company, directly or indirectly, holds a minority interest, to the
extent such Debt is included in consolidated Debt, plus (2) the Company’s
share of Debt for each non-wholly owned Subsidiary of the Company and each
other Persons in which the Company, directly or indirectly, holds a minority
interest based on the company’s pro-rata economic interest in each such
Subsidiary or Person or, to the extent to which the Company is directly or
indirectly (through one or more Subsidiaries or Persons) liable for a percent
of such Debt that is greater than such pro-rata economic interest in such
Subsidiary or Person, such larger amount;
provided, however, for purposes of calculating Proportionally
Consolidated Debt, the Debt of the Brazilian Entities shall be deemed to be
$110,437,781.

 

(fff)         “Proportionally
Consolidated Unrestricted Cash” means the consolidated Unrestricted Cash of
the Company less (1) all Unrestricted Cash of Subsidiaries of the Company
that are not wholly-owned and Persons in which the Company, directly or
indirectly, owns a minority interest, to the extent such Unrestricted Cash is
included in consolidated Unrestricted Cash of the Company, plus (2) the
Company’s share of Unrestricted Cash for each non-wholly owned Subsidiary of
the Company and Persons in which the Company, directly or indirectly, owns a
minority interest based on the Company’s pro-rata economic interest in each
such Subsidiary or Person; provided, however, for purposes of
calculating Proportionally Consolidated Unrestricted Cash, the Unrestricted
Cash of the Brazilian Entities shall be deemed to be $82,000,000, provided,
further, that any distributions of Unrestricted Cash made from the date
of this Agreement to the Closing by Brazilian Entities to the Company or any of
its Subsidiaries shall be disregarded for purposes of calculating
Proportionally Consolidated Unrestricted Cash.

 

(ggg)      “Reinstatement
Adjustment Amount” means the difference resulting from subtracting the
Reinstatement Amount from the aggregate amount of Corporate Level Debt.

 

(hhh)      “Reinstatement
Amount” means the amount of Corporate Level Debt to the extent such
obligations will be reinstated pursuant to the Plan, including, to the extent
applicable, based on the elections of the holders of such Corporate Level Debt
prior to the election deadline established by the Bankruptcy Court.

 

(iii)          “Reserve
Surplus Amount” means, as of any date of determination, (x) the
Reserve minus (y) the aggregate amount paid with respect to Permitted
Claims through such date of determination to the extent such Permitted Claims
were included in the calculation of the Reserve minus (z) any amount
included in the Reserve with respect to Permitted Claims that the Company
Board, based on the exercise of its business judgment and information available
to the Company Board as of the date of determination, considers necessary to
maintain as a reserve against Permitted Claims yet to be paid.

 

76

 

(jjj)          “Rights
Agreement” means that certain Rights Agreement, dated as of
November 18, 1998, by and between the Company and BNY Mellon Shareowner
Services, as successor to Norwest Bank Minnesota, N.A., as amended on
November 10, 1999, December 31, 2001 and November 18, 2008, and
from time to time.

 

(kkk)       “Rouse
Bonds” means (i) the 6-3/4% Senior Notes Due 2013 issued pursuant to
the Indenture, dated as of May 5, 2006, by and among The Rouse Company LP
and TRC Co-Issuer, Inc., as co-issuers and The Bank of New York Mellon
Corporation, as trustee, and (ii) unsecured debentures issued pursuant to
the Indenture, dated as of February 24, 1995, by and between The Rouse
Company, as issuer, and The Bank of New York Mellon Corporation, as trustee.

 

(lll)          “Share
Equivalent” means any stock, warrants, rights, calls, options or other
securities exchangeable or exercisable for, or convertible into, shares of
Common Stock, New Common Stock or GGO Common Stock, as applicable.

 

(mmm)    “Significant
Subsidiaries” means the operating Subsidiaries of the Company that
generated revenues in excess of $30,000,000 for the year ended
December 31, 2009.

 

(nnn)      “Subsidiary”
means, with respect to a Person (including the Company), (a) a company a
majority of whose capital stock with voting power, under ordinary
circumstances, to elect a majority of the directors is at the time, directly or
indirectly, owned by such Person, by a subsidiary of such Person, or by such
Person and one or more subsidiaries of such Person, (b) a partnership in
which such Person or a subsidiary of such Person is, at the date of
determination, a general partner of such partnership, (c) a limited
liability company of which such Person, or a Subsidiary of such Person, is a
managing member or (d) any other Person (other than a company) in which
such Person, a subsidiary of such Person or such Person and one or more
subsidiaries of such Person, directly or indirectly, at the date of
determination thereof, has (i) at least a majority ownership interest or
(ii) the power to elect or direct the election of a majority of the
directors or other governing body of such Person.

 

(ooo)      “Target
Net Debt” means $22,970,800,000.

 

(ppp)      “Tax
Protection Agreements” means any written agreement to which the Company,
its Operating Partnership or any other Subsidiary is a party pursuant to
which:  (i) in connection with the
deferral of income Taxes of a holder of interests in the Operating Partnership,
the Company, the Operating Partnership or the other Subsidiaries have agreed to
(A) maintain a minimum level of Indebtedness or continue any particular
Indebtedness, (B) retain or not dispose of assets for a period of time
that has not since expired, (C) make or refrain from making Tax elections,
and/or (D) only dispose of assets in a particular manner; and/or
(ii) limited partners of the Operating Partnership have guaranteed Indebtedness
of the Operating Partnership.

 

(qqq)      “Termination
Date” means December 31, 2010; provided, that in the event the
Company delivers a written notice (the “Termination Date Extension Notice”)
identifying the applicable clause below pursuant to which the extension is
being effected to Purchaser on or prior to December 31, 2010, the Company
may elect to extend the Termination Date if:

 

77

 

(i)                                     the
Confirmation Order shall have been entered on or before December 15, 2010,
to any date on or prior to January 31, 2011 (as specified in the
Termination Date Extension Notice), provided that, during such extension, the
Company shall use its reasonable best efforts to take all actions and to do all
things necessary, proper and advisable to consummate the transactions
contemplated hereby and to cause the conditions to Closing to be satisfied in a
timely manner; or

 

(ii)                                  (A) all
conditions to the obligations of Purchaser to consummate the Closing set forth
in Article VII shall have been satisfied (other than those
conditions that are to be satisfied (and capable of being satisfied) by action
taken at the Closing if (1) Purchaser and each purchaser under the
Fairholme/Pershing Agreements (each, an “Other Sponsor”) had complied
with its obligations under this Agreement and the Fairholme/Pershing
Agreements, as applicable, and (2) the Brookfield Equity Commitment
Letter, the Escrow Agreements and any letter of credit contemplated thereby
(each, a “Funding Document”) had been complied with) and (B) the
transactions contemplated by this Agreement or the Fairholme/Pershing
Agreements fail to be consummated as a result of a failure of any Funding
Document to be complied with, the failure of Purchaser to fund the amounts it
is required to fund pursuant to Article I or the failure of the
Fairholme/Pershing Investors to fund the purchase price under the
Fairholme/Pershing Agreements, to any date on or prior to (X) if either
Fairholme/Pershing Agreement shall not have been terminated in accordance with
its terms and any Other Sponsor fails to fund, March 31, 2011 (as
specified in the Termination Date Extension Notice) in order to pursue remedies
against the non-compliant Other Sponsors or (Y) if Purchaser fails to
fund, the earlier of the one (1) year anniversary of the date of a
Termination Date Extension Notice given pursuant to this clause (Y) and
December 31, 2011 (as specified in the Termination Date Extension Notice)
in order to pursue remedies against Purchaser, in each case, to seek to cause
the Closing to be consummated, provided that, during such extensions specified
in clause (X) or (Y) of this clause (ii), the Company shall use its
reasonable best efforts to take all actions and to do all things necessary, proper
and advisable to consummate the transactions contemplated hereby and to cause
the conditions to Closing to be satisfied in a timely manner.

 

(rrr)         “Transactions”
means the purchase of the Shares and the GGO Shares and the other transactions
contemplated by this Agreement.

 

(sss)       “TRUPS”
means certain preferred securities issued by GGP Capital Trust I.

 

(ttt)         “Unrestricted
Cash” means all cash and Cash Equivalents of the Company and of the
Subsidiaries of the Company, but excluding any cash or Cash Equivalents that are
controlled by or subject to any lien, security interest or control agreement,
other preferential arrangement in favor of any creditor or otherwise encumbered
or restricted in any way; provided that cash and

 

78

 

Cash
Equivalents of the Company and of the Subsidiaries of the Company that are
controlled by or subject to any lien, security interest, control agreement,
preferential arrangement or other encumbrance or restriction pursuant to the
New DIP Agreement shall not be excluded from “Unrestricted Cash.”

 

(uuu)      “Unsecured
Indebtedness” means all indebtedness of the Company for borrowed money or
obligations of the Company evidenced by notes, bonds, debentures or other
similar instruments that are not secured by a lien on any Company Property or
other assets of the Company or any Subsidiary.

 

(vvv)      “UPREIT
Units” means preferred or common units of limited partnership interests of
the Operating Partnership.

 

ARTICLE XIII

 

MISCELLANEOUS

 

SECTION 13.1       Notices.  All notices and other communications in
connection with this Agreement shall be in writing and shall be considered
given if given in the manner, and be deemed given at times, as follows:  (x) on the date delivered, if personally
delivered; (y) on the day of transmission if sent via facsimile
transmission to the facsimile number given below, and telephonic confirmation
of receipt is obtained promptly after completion of transmission; or
(z) on the next Business Day after being sent by recognized overnight mail
service specifying next business day delivery, in each case with delivery
charges pre-paid and addressed to the following addresses:

 

(a)          If
to Purchaser, to:

 

REP Investments LLC

c/o Brookfield Asset
Management Inc.

Brookfield Place, Suite 300

181 Bay Street

P.O. Box 762

Toronto, Ontario M5J 2T3

Canada

Attention:        Joseph Freedman

Facsimile:       (416) 365-9642

 

with a copy (which shall not constitute notice) to:

 

Willkie Farr & Gallagher LLP

787 Seventh Avenue

New York, NY 10019

Attention:        Marc
Abrams, Esq.

                        Gregory
B. Astrachan, Esq.

                        Paul
V. Shalhoub, Esq.

Facsimile:       (212) 728-8111

 

79

 

(b)          If
to the Company, to:

 

General Growth Properties, Inc.

110 N. Wacker Drive

Chicago, IL 60606

Attention:  Ronald L. Gern, Esq.

Facsimile:     (312) 960-5485

 

with a copy (which shall not constitute notice) to:

 

Weil, Gotshal & Manges LLP

767 Fifth Avenue

New York, NY 10153

Attention:           Marcia
L. Goldstein, Esq.

                           Frederick
S. Green, Esq.

                           Gary
T. Holtzer, Esq.

                           Malcolm
E. Landau, Esq.

Facsimile:          (212)
310-8007

 

SECTION 13.2       Assignment;
Third Party Beneficiaries.  Neither
this Agreement nor any of the rights, interests or obligations under this
Agreement may be assigned by any party without the prior written consent of the
other party.  Notwithstanding the
previous sentence, this Agreement, or Purchaser’s rights, interests or
obligations hereunder, may be assigned or transferred, in whole or in part, by
Purchaser to Brookfield Consortium Members; provided, that any such
assignee assumes the obligations of Purchaser hereunder and agrees in writing
to be bound by the terms of this Agreement in the same manner as Purchaser and
the Designation Conditions are otherwise satisfied.  Notwithstanding the foregoing or any other
provisions herein, no such assignment shall relieve Purchaser of its
obligations hereunder if such assignee fails to perform such obligations.  The Company agrees that Purchaser may
designate to Blackstone Real Estate Partners VI L.P., a Delaware limited
partnership (together with its permitted assigns, “Blackstone”),
(i) Purchaser’s right to purchase 19,083,970 of the Shares (the “Blackstone
Assigned Shares”) and 200,382 of the GGO Shares (together with the
Blackstone Assigned Shares, the “Blackstone Assigned Securities”), in
each case, that Purchaser is entitled to purchase at Closing pursuant to this
Agreement, (ii) Purchaser’s right to receive  2,500,000 of the New Warrants (the “Blackstone
Assigned Warrants”) and 166,667 of the GGO Warrants, in each case, issuable
to Purchaser pursuant to this Agreement, (iii) Purchaser’s right to receive
7.634% of Purchaser’s compensation in the form of New Common Stock with respect
to the GGP Backstop Rights Offering and other rights of Purchaser set forth in Section 6.9(a) and
Section 6.9(b) in the event Purchaser designates Blackstone as
one of its designees to subscribe for New Common Stock in such GGP Backstop
Rights Offering, and (iv) Purchaser’s right to receive 7.634% of the
shares of Common Stock (and other Share Equivalents) which are offered to
Purchaser pursuant to Purchaser’s pre-Closing subscription rights set forth in Section 7.1(u) in
the event Purchaser elects to purchase the shares offered to it in such
offering, provided that (1) the Company’s agreement as aforesaid is
subject to Blackstone (A) paying to the Company and GGO, as applicable, by
wire transfer of immediately available funds at the Closing the aggregate
purchase price payable pursuant to this Agreement for the Blackstone Assigned
Securities (the “Blackstone Purchase Price”) and the purchase price for
shares received by Blackstone pursuant

 

80

 

to
clauses (iii) and (iv) above, (B) agreeing in a writing
reasonably satisfactory to, and for the benefit of, the Company that the
Blackstone Assigned Securities shall be subject to such transfer
restrictions/lock-ups as contemplated by Section 6.4 of the Pershing
Agreement (and not the longer lock-ups applicable to shares sold to Purchaser),
including being subject to a limited 120-day lock-up in connection with certain
equity sales within 30 days of the Effective Date but excluding any
restrictions imposed by the Non-Control Agreement, and (C) entering into
joinder agreements reasonably acceptable to, and for the benefit of, the
Company with respect to the provisions of clause (B) and the registration
rights agreement referred to in the following sentence, and (2) in no
event shall Purchaser be released from any of its obligations hereunder
(including in respect of the Blackstone Assigned Securities) unless and until
Blackstone shall have complied with clauses (A), (B) and
(C) above.  In the event of the
closing of the purchase by Blackstone from the Company and GGO, as applicable,
of the Blackstone Assigned Securities and the payment by Blackstone to the
Company and GGO, as applicable, of the Blackstone Purchase Price at Closing as
aforesaid, (x) Purchaser shall be released from the obligation to pay the
Company the purchase price for the Blackstone Assigned Securities (but not from
the obligation to pay the purchase price pursuant to this Agreement for any
other Shares or GGO Shares or other obligations hereunder) and (y) the
shelf registration statement contemplated by Section 7.1(l) of the
Pershing Agreement shall cover the resale by Blackstone of the Blackstone
Assigned Shares and the New Common Stock issuable upon exercise of the
Blackstone Assigned Warrants and the registration rights agreement of the
Company referenced in Section 7.1(l) of the Pershing Agreement shall
include Blackstone and its securities to the same extent as it applies to the
Pershing Investors and their securities (except that demand registration rights
shall not be available to Blackstone). 
Blackstone may assign the foregoing rights, in whole or in part, to one
or more Affiliates, provided that no such assignment shall release Blackstone
Real Estate Partners VI L.P. from any obligations assigned by Purchaser to
it.  Except as provided in Article IX
with respect to the Indemnified Persons, this Agreement (including the
documents and instruments referred to in this Agreement) is not intended to and
does not confer upon any person other than the parties hereto any rights or
remedies under this Agreement. 
Notwithstanding the foregoing or any other provisions herein to the
contrary, Purchaser may not assign any of its rights, interests or obligations
under this Agreement, to the extent such assignment would affect the securities
Laws exemptions applicable to this transaction.

 

SECTION 13.3       Prior
Negotiations; Entire Agreement.  This
Agreement (including the exhibits hereto and the documents and instruments
referred to in this Agreement) constitutes the entire agreement of the parties
and supersedes all prior agreements, arrangements or understandings, whether
written or oral, between the parties with respect to the subject matter of this
Agreement, except that the parties hereto acknowledge that the Confidentiality
Agreement shall continue in full force and effect in accordance with their
terms and shall terminate no earlier than this Agreement.

 

SECTION 13.4       Governing
Law; Venue.  THIS AGREEMENT WILL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF
NEW YORK.  BOTH PARTIES HEREBY
IRREVOCABLY SUBMIT TO THE JURISDICTION OF, AND VENUE IN, THE UNITED STATES
BANKRUPTCY COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND BOTH PARTIES WAIVE
ANY OBJECTION BASED ON FORUM NON CONVENIENS.

 

81

 

SECTION 13.5       Company
Disclosure Letter.  The Company
Disclosure Letter shall be arranged to correspond to the Articles and Sections
of this Agreement, and the disclosure in any portion of the Company Disclosure
Letter shall qualify the corresponding provision in Article III and
any other provision of Article III to which it is reasonably
apparent on the face of the disclosure that such disclosure relates.  No disclosure in the Company Disclosure
Letter relating to any possible non-compliance, breach or violation of any
Contract or Law shall be construed as an admission that any such
non-compliance, breach or violation exists or has actually occurred.  In the Company Disclosure Letter,
(a) all capitalized terms used but not defined therein shall have the meanings
assigned to them in this Agreement and (b) the Section numbers
correspond to the Section numbers in this Agreement.

 

SECTION 13.6       Counterparts.  This Agreement may be executed in any number
of counterparts, all of which shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each of the
parties; and delivered to the other party (including via facsimile or other
electronic transmission), it being understood that each party need not sign the
same counterpart.

 

SECTION 13.7       Expenses.  Each party shall bear its own expenses
incurred or to be incurred in connection with the negotiation and execution of
this Agreement and each other agreement, document and instrument contemplated
by this Agreement and the consummation of the transactions contemplated hereby
and thereby.

 

SECTION 13.8       Waivers
and Amendments.  This Agreement may
be amended, modified, superseded, cancelled, renewed or extended, and the terms
and conditions of this Agreement may be waived, only by a written instrument
signed by the parties or, in the case of a waiver, by the party waiving
compliance, and subject, to the extent required, to the approval of the
Bankruptcy Court.  No delay on the part
of any party in exercising any right, power or privilege pursuant to this
Agreement shall operate as a waiver thereof, nor shall any waiver on the part
of any party of any right, power or privilege pursuant to this Agreement, nor
shall any single or partial exercise of any right, power or privilege pursuant
to this Agreement, preclude any other or further exercise thereof or the
exercise of any other right, power or privilege pursuant to this
Agreement.  The rights and remedies
provided pursuant to this Agreement are cumulative and are not exclusive of any
rights or remedies which any party otherwise may have at law or in equity.

 

SECTION 13.9       Construction.

 

(a)           The
headings in this Agreement are for reference purposes only and shall not in any
way affect the meaning or interpretation of this Agreement.

 

(b)           Unless
the context otherwise requires, as used in this Agreement:  (i) an accounting term not otherwise
defined in this Agreement has the meaning ascribed to it in accordance with
GAAP; (ii) “or” is not exclusive; (iii) “including” and its variants
mean “including, without limitation” and its variants; (iv) words defined
in the singular have the parallel meaning in the plural and vice versa;
(v) references to “written” or “in writing” include in visual electronic
form; (vi) words of one gender shall be construed to apply to each gender;
(vii) the terms “Article,” “Section,” and “Schedule” refer to the
specified Article, Section, or

 

82

 

Schedule
of or to this Agreement; and (viii) the term “beneficially own” shall have
the meaning determined pursuant to Rule 13d-3 under the Exchange Act as in
effect on the date hereof; provided, however, that a Person will be deemed to
beneficially own (and have beneficial ownership of) all securities that such
Person has the right to acquire, whether such right is exercisable immediately
or with the passage of time or the satisfaction of conditions.  The terms “beneficial ownership” and “beneficial
owner” have correlative meanings.

 

(c)           Notwithstanding
anything to the contrary, and for all purposes of this Agreement, any public
announcement or filing of factual information relating to the business,
financial condition or results of the Company or its Subsidiaries, or a
factually accurate (in all material respects) public statement or filing that
describes the Company’s receipt of an offer or proposal for a Competing
Transaction and the operation of this Agreement with respect thereto, or any
entry into a confidentiality agreement, shall not be deemed to evidence the Company’s
or any Subsidiary’s support, or intention to support, any Competing
Transaction.

 

(d)           In
the event of a conflict between the terms and conditions of this Agreement and
the Plan Summary Term Sheet, the terms and conditions of this Agreement shall
govern.

 

SECTION 13.10     Adjustment
of Share Numbers and Prices.  The
number of Shares to be purchased by Purchaser at the Closing pursuant to Article I,
the Per Share Purchase Price, the GGO Per Share Purchase Price, the number of
GGO Shares to be purchased by Purchaser pursuant to Article II and
any other number or amount contained in this Agreement which is based upon the
number or price of shares of GGP or GGO shall be proportionately adjusted for
any subdivision or combination (by stock split, reverse stock split, dividend,
reorganization, recapitalization or otherwise) of the Common Stock, New Common
Stock or GGO Common Stock that occurs during the period between the date of
this Agreement and the Closing.  In
addition, if at any time prior to the Closing, the Company or GGO shall declare
or make a dividend or other distribution whether in cash or property (other
than a dividend or distribution payable in common stock of the Company or GGO,
as applicable, the GGO Share Distribution or a distribution of rights
contemplated hereby), the Per Share Purchase Price or the GGO Per Share
Purchase Price, as applicable, shall be proportionally adjusted thereafter by
the Fair Market Value (as defined in the Warrant Agreement) per share of the
dividend or distribution.  If a
transaction results in any adjustment to the exercise price for and number of
Shares underlying the Warrants pursuant to Article 5 of the Warrant
Agreement, the exercise price for and number of shares underlying each of the
New Warrants and GGO Warrants described in Section 5.2 of this
Agreement shall be adjusted for that transaction in the same manner.

 

SECTION 13.11     Certain
Remedies.

 

(a)           The
parties agree that irreparable damage would occur in the event that any of the
provisions of this Agreement were not performed in accordance with their
specific terms.  It is accordingly agreed
that, subject to clause (c) below, the parties shall be entitled to
specific performance of the terms of this Agreement.  This right shall include the right of the
Company to (i) fully enforce, or require Purchaser to fully enforce, the
terms of the Brookfield Equity Commitment Letter against the Equity Provider
party thereto to the fullest extent possible pursuant to the Brookfield Equity
Commitment Letter and applicable Law and (ii) require Purchaser to deliver
a Closing Funding Certification (as defined in the Escrow Agreements) in

 

83

 

accordance
with, and subject to, the applicable provisions of the Escrow Agreement, including
Section 4(d) thereof (or the corollary provisions of any Acceptable
LC) and upon concurrent funding pursuant to the Brookfield Equity Commitment
Letter (the financing referred to in clauses (i) and (ii) of this Section 13.11(a) being
referred to herein as the “Equity Financing”) and to cause Purchaser to
pay the Purchase Price and the GGO Purchase Price and consummate the
Transactions on the terms and subject to the provisions set forth in this
Agreement.  It is explicitly agreed that
the Company shall be entitled to seek specific performance of Purchaser’s
obligation to cause the Equity Financing to be funded to fund the Purchase
Price and the GGO Purchase Price only in the event that (x) all conditions
in Article VII have been satisfied (other than those conditions
that are to be satisfied (and capable of being satisfied) by action taken at
the Closing if Purchaser had complied with its obligations under this Agreement
and the Financing Commitments had been complied with) at the time when the
Closing would have occurred but for the failure of the Purchase Price and the
GGO Purchase Price to be funded, and (y) the Company has irrevocably
confirmed that if specific performance is granted and the Purchase Price and
the GGO Purchase Price are funded, then the Closing will occur.  Each of the parties hereto hereby waives
(i) any defenses in any action for specific performance, including the
defense that a remedy at law would be adequate and (ii) any requirement
under any Law to post a bond or other security as a prerequisite to obtaining
equitable relief.  Further, the parties
agree that the Company’s right to demand specific performance of the purchase
obligations contained herein shall be limited to complete performance, and not
subject to partial performance or the sale of less than all of the Shares to be
purchased by Purchaser hereunder and shall be further conditioned upon the
concurrent funding pursuant to, and in accordance with, the Brookfield Equity
Commitment Letter.

 

(b)           THE COMPANY HEREBY AGREES THAT, PRIOR TO THE CLOSING, SPECIFIC
PERFORMANCE (AND AN INJUNCTION OR INJUNCTIONS, WITHOUT NECESSITY OF PROVING
DAMAGES OR POSTING A BOND OR OTHER SECURITY, TO PREVENT BREACHES OF THIS
AGREEMENT) SHALL BE ITS SOLE AND EXCLUSIVE REMEDY WITH RESPECT TO BREACHES BY
PURCHASER IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY AND THAT IT MAY NOT SEEK OR ACCEPT ANY OTHER FORM OF RELIEF
THAT MAY BE AVAILABLE FOR BREACH UNDER THIS AGREEMENT, THE ESCROW
AGREEMENTS, THE BROOKFIELD EQUITY COMMITMENT LETTER, ANY ACCEPTABLE LC OR
OTHERWISE IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY (INCLUDING MONETARY DAMAGES).

 

(c)           Prior
to the entry of the Confirmation Order, other than with respect to (i) the
indemnification obligations of the Company set forth in Article IX
and (ii) the Company’s obligations under Section 5.1(c),
Purchaser’s right to receive the Warrants on the terms and subject to the
conditions set forth in this Agreement shall constitute the sole and exclusive remedy
of any nature whatsoever (whether for monetary damages, specific performance,
injunctive relief, or otherwise) of Purchaser against the Company for any harm,
damage or loss of any nature relating to or as a result of any breach of this
Agreement by the Company or the failure of the Closing to occur for any reason;
provided, that, following the entry of the Approval

 

84

 

Order,
Purchaser shall be entitled to specific performance of the Company’s obligation
to issue the Warrants as well as the Company’s obligations under Article IX
and Section 5.1(c) hereof.

 

(d)           Following
entry of the Confirmation Order, Purchaser shall be entitled to specific
performance of terms of this Agreement, in addition to any other applicable
remedies at law.

 

(e)           Following
the Closing, each of the parties shall be entitled to an injunction or
injunctions (without necessity of proving damages or posting a bond or other
security) to prevent breaches of this Agreement, and to enforce specifically
the terms and provisions of this Agreement, in addition to any other applicable
remedies at law or equity.

 

(f)            The
Company, on behalf of itself and its respective heirs, successors, and assigns,
hereby covenants and agrees never to institute or cause to be instituted or
continue prosecution of any suit or other form of action or proceeding of any
kind or nature whatsoever against any member of Purchaser by reason of or in
connection with the Transaction, provided, however, that nothing shall prohibit
the Company from instituting an action for specific performance against
Purchaser in connection with this Agreement in accordance with the provisions
of this Section 13.11 or from instituting an action against Escrow
Agent for release of the Escrow Amounts.

 

SECTION 13.12     Bankruptcy
Matters.  For the avoidance of doubt,
all obligations of the Company and its Subsidiaries in this Agreement are
subject to and conditioned upon (a) with respect to the issuance of the
Warrants and the other obligations contained in the Approval Order, including
approval of the indemnification provisions of Article IX hereof,
entry of the Approval Order, and (b) with respect to the remainder of the
provisions hereof, entry of the Confirmation Order.

 

[Signature Page Follows]

 

85

 

IN WITNESS WHEREOF, the undersigned have caused this
Agreement to be executed and delivered by each of them or their respective
officers thereunto duly authorized, all as of the date first written above.

 

	
   

  	
  GENERAL GROWTH PROPERTIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Thomas H. Nolan, Jr.

  
	
   

  	
   

  	
  Name: Thomas H. Nolan, Jr.

  
	
   

  	
   

  	
  Title: President and Chief
  Operating Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  REP INVESTMENTS LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  BY:

  	
  Brookfield Asset Management Private Institutional
  Capital Adviser (Canada) L.P., its managing member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Brookfield Private Funds Holdings Inc., its
  general partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
  /s/ Karen Ayre

  
	
   

  	
   

  	
   

  	
  Name: Karen Ayre

  
	
   

  	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Moshe Mandelbaum

  
	
   

  	
   

  	
   

  	
  Name: Moshe Mandelbaum

  
	
   

  	
   

  	
   

  	
  Title: Vice President

  

 

[SIGNATURE PAGE OF AMENDED AND RESTATED CORNERSTONE INVESTMENT
AGREEMENT]

 

 

EXHIBIT A - PLAN SUMMARY TERM SHEET

 

 

 

GENERAL GROWTH PROPERTIES, INC.

PLAN SUMMARY TERM SHEET(1)

 

8/2/2010

 

This term sheet (the “Term Sheet”) describes
the material terms of a proposed chapter 11 joint plan of reorganization (the “Plan”)
of the Plan Debtors (as defined below) solely for the purposes of the
Investment Agreements (as defined below). 
The transactions contemplated by this term sheet are subject to
conditions to be set forth in definitive documents, including the Investment
Agreements and to the approval by the United States Bankruptcy Court for the
Southern District of New York (the “Bankruptcy Court”).  This Term Sheet is not an offer or
solicitation for any chapter 11 plan and is being presented for discussion and
settlement purposes only.  Acceptance of
any such plan by any party (including those named herein) will not be solicited
from any person or entity until such person or entity has received the
disclosures required under or otherwise in compliance with applicable law.  Accordingly, this Term Sheet does not bind
any creditor or other party to vote in favor of or support any chapter 11
plan.  In the event of any inconsistency
between the terms of the Plan and this Term Sheet, or the terms of any
applicable Investment Agreement and this Term Sheet, the terms of the Plan and
the Investment Agreements, respectively, shall control for their respective
purposes.

 

I.                                         PARTIES/AGREEMENTS

 

	
  A.            GGP

  	
   

  	
  General
  Growth Properties, Inc. (“GGP”) on or before the Effective Date
  and GGP, as reorganized, from and after the Effective Date

  
	
   

  	
   

  	
   

  
	
  B.            Plan Debtors

  	
   

  	
  The debtors, including GGP, whose chapter 11 cases
  are pending in the Bankruptcy Court under Chapter 11 Case No. 09-11977
  (ALG), whose chapter 11 cases have not otherwise been confirmed and whose
  chapter 11 cases will be treated pursuant to the Plan (collectively, the “Plan
  Debtors”)

  
	
   

  	
   

  	
   

  
	
  C.            Confirmed Debtors

  	
   

  	
  The subsidiary debtors other than the Plan Debtors
  whose chapter 11 plans have been confirmed as of the Effective Date (the “Confirmed
  Debtors”)

  
	
   

  	
   

  	
   

  
	
  D.            Debtors

  	
   

  	
  Plan Debtors, Confirmed Debtors and to the extent
  applicable, any debtor whose chapter 11 case is pending under Chapter 11 Case
  No. 09-11977 (ALG) but that is not a Plan Debtor or a Confirmed Debtor

  
	
   

  	
   

  	
   

  
	
  E.              REP

  	
   

  	
  REP Investments LLC (“REP”)

  
	
   

  	
   

  	
   

  
	
  F.              Fairholme

  	
   

  	
  Fairholme Capital Management, LLC, on behalf of
  one or more of its managed funds or affiliates of such managed funds (“Fairholme”)

  

 

(1)                                  Capitalized terms used but
not otherwise defined herein shall have the meanings ascribed to them in the
Investment Agreement to which this Term Sheet is attached.

 

 

	
  G.            Pershing

  	
   

  	
  Pershing Square Capital Management, L.P., on
  behalf of one or more of its managed funds (“Pershing” and together
  with REP and Fairholme, the “Purchasers”)

  
	
   

  	
   

  	
   

  
	
  H.            Confirmed Plans

  	
   

  	
  The chapter 11 plans of the Confirmed Debtors (the
  “Confirmed Plans”)

  
	
   

  	
   

  	
   

  
	
  I.                 CIA

  	
   

  	
  Amended and Restated Cornerstone Investment
  Agreement effective as of March 31, 2010 between REP and GGP (the “CIA”)

  
	
   

  	
   

  	
   

  
	
  J.              Fairholme Stock Purchase Agreement

  	
   

  	
  Amended and Restated Stock Purchase Agreement
  effective as of March 31, 2010 between the purchasers parties thereto
  and GGP (the “Fairholme SPA”)

  
	
   

  	
   

  	
   

  
	
  K.            Pershing Stock Purchase Agreement

  	
   

  	
  Amended and Restated Stock Purchase Agreement
  effective as of March 31, 2010 between the purchasers parties thereto
  and GGP (the “Pershing SPA” and together with the CIA and the
  Fairholme SPA, the “Investment Agreements”)

  

 

II.                                     TREATMENT OF CLAIMS AND INTERESTS

 

	
  A.            DIP Loan Claims

  	
  ·             Treatment:  Paid in full, in cash on the effective date
  (the “Effective Date”) of the Plan.

  ·             The Plan Debtors may, at their option,
  satisfy all or a portion of the DIP Loan Claims through a conversion to New
  Common Stock (a “DIP Conversion”), provided GGP engages in a
  “Qualified Rights Offering” in accordance with the terms of the order
  approving the DIP facility or on such other terms as the parties may agree. 

  
	
   

  	
   

  
	
  B.                 Allowed Administrative Expense Claims

  	
  ·             Treatment:  Paid in full, in cash on the Effective Date
  or on such other terms as the parties may agree.

  
	
   

  	
   

  
	
  C.                 Allowed Priority Non-Tax Claims

  	
  ·             Treatment:  Paid in full, in cash on the Effective Date
  or on such other terms as the parties may agree. 

  
	
   

  	
   

  
	
  D.                 Allowed Priority Tax Claims

  	
  ·             Treatment:  At the Plan Debtors’ election,
  (i) paid in full, in cash on the Effective Date, (ii) receive the
  treatment provided for in section 1129(a)(9)(c) of the Bankruptcy Code
  or (iii) receive treatment on such other terms as the parties may agree.

  
	
   

  	
   

  
	
  E.                   Allowed Secured Tax Claims

  	
  ·             Treatment:  At the Plan Debtors’ election,
  (i) paid in full, in cash on the Effective Date, (ii) receive the
  treatment provided for in section 1129(a)(9)(d) of the Bankruptcy Code
  or (iii) receive treatment on such other terms as the parties may agree.

  
	
   

  	
   

  
	
  F.                   Allowed Mechanics’ Lien Claims

  	
  ·             Treatment:  Paid in full, in cash on the Effective
  Date, as well as any amounts allowed and required to be paid pursuant to
  section 506(b) of the Bankruptcy Code, including postpetition interest
  at the Federal Judgment 

  

 

 

	
   

  	
  Rate (as defined in the Confirmed Plans) unless
  there is an applicable contractual rate or rate of interest under state law,
  in which case interest shall be paid at such rate of interest, provided the
  claimant satisfies certain notice requirements consistent with those terms
  contained in the Confirmed Plans.  The
  mechanics’ liens securing the Mechanics’ Lien Claims shall be deemed released
  and shall require no further action on the part of the holders of the Mechanics’
  Lien Claims. 

  
	
   

  	
   

  
	
  G.            Allowed Other Secured Claims

  	
  ·             Treatment:  At the Plan Debtors’ option, on the
  Effective Date, holders of allowed Other Secured Claims shall either
  (a) be reinstated and rendered unimpaired, (b) receive cash in an
  amount equal to such allowed Other Secured Claim plus any interest allowed
  and required to be paid under section 506(b) of the Bankruptcy Code,
  (c) receive the collateral securing its allowed Other Secured Claim or
  (d) such other treatment as the holder of the Other Secured Claim and
  the Plan Debtors may agree. 

  
	
   

  	
   

  
	
  H.            Rouse 8.00% Note Claims

  	
  ·             Treatment: On the Effective Date,
  the Allowed Rouse 8.00% Note Claims shall be satisfied in full, in cash or
  shall receive such other treatment as is permissible pursuant to section 1129
  of the Bankruptcy Code.  In addition, the Plan Debtors
  shall pay in cash any outstanding reasonable agent or trustee fees and
  expenses provided for under the applicable indenture. 

  
	
   

  	
   

  
	
  I.                 Rouse 3.625% Note Claims

  	
  ·             Treatment: On the Effective Date,
  the Allowed Rouse 3.625% Note Claims shall be satisfied in full, in cash or
  shall receive such other treatment as is permissible pursuant to section 1129
  of the Bankruptcy Code.  In addition, the Plan Debtors
  shall pay in cash any outstanding reasonable agent or trustee fees and
  expenses provided for under the applicable indenture.

  
	
   

  	
   

  
	
  J.              Rouse 5.375% Note Claims

  	
  ·             Treatment:  On the Effective Date, the Allowed Rouse
  5.375% Note Claims (i) shall be cured and reinstated in accordance with
  section 1124 of the Bankruptcy Code, or (ii) shall receive such other
  treatment as is permissible under section 1129 of the Bankruptcy Code. 
  In addition, the Plan Debtors shall pay in cash any outstanding reasonable
  agent or trustee fees and expenses provided for under the applicable
  indenture.

  
	
   

  	
   

  
	
  K.            Rouse 63⁄4% Note Claims

  	
  ·             Treatment: On the Effective Date,
  the Allowed Rouse 63⁄4  % Note Claims (i) shall be
  cured and reinstated in accordance with section 1124 of the Bankruptcy Code,
  or (ii) shall receive such other treatment as is permissible under
  section 1129 of the Bankruptcy Code. 
  In addition, the Plan Debtors shall pay in cash any outstanding
  reasonable agent or trustee fees and 

  

 

 

	
   

  	
  expenses provided for under the applicable
  indenture.

  
	
   

  	
   

  
	
  L.                  Rouse 7.20% Note Claims

  	
  ·             Treatment: On the Effective Date,
  the Allowed Rouse 7.20%  Note
  Claims (i) shall be cured and reinstated in accordance with section 1124
  of the Bankruptcy Code, or (ii) shall receive such other treatment as is
  permissible under section 1129 of the Bankruptcy Code.  In addition, the Plan Debtors shall pay in
  cash any outstanding reasonable agent or trustee fees and expenses provided
  for under the applicable indenture.

  
	
   

  	
   

  
	
  M.               2006 Bank Loan Claims

  	
  ·             Treatment: On the Effective Date,
  the Allowed 2006 Bank Loan Claims shall be satisfied in full, in cash.  In addition, the Plan Debtors shall pay in
  cash any outstanding reasonable agent fees and expenses provided for under
  the applicable loan agreement.

  
	
   

  	
   

  
	
  N.                 144A Exchangeable Notes Claims

  	
  ·             Treatment: On the Effective Date,
  the Allowed 144A Exchangeable Note Claims (i) shall be cured and
  reinstated in accordance with section 1124 of the Bankruptcy Code or at the
  option of such holders, shall be satisfied in cash at par plus accrued
  interest at the stated non-default contract rate and shall be deemed to have
  waived any other claims, or (ii) shall receive such other treatment as
  is permissible under section 1129 of the Bankruptcy Code.  In addition, the Plan Debtors shall pay in
  cash any outstanding reasonable agent or trustee fees and expenses provided
  for under the applicable indenture. 
  For the avoidance of doubt, in the event the Plan Debtors determine to
  provide the treatment option pursuant to subsection (ii) above subsequent
  to a holder of an Allowed 144A Exchangeable Notes Claim electing to receive
  cash at par plus accrued interest, such election shall not be binding on such
  holder.

  
	
   

  	
   

  
	
  O.                2006 Trust Preferred Shared and Junior Subordinated Notes (the “TRUPs
  Claims”)

  	
  ·             Treatment:  On the Effective Date, the Allowed TRUPs
  Claims shall be cured and reinstated in accordance with section 1124 of the
  Bankruptcy Code or shall receive such other treatment permissible under
  section 1129 of the Bankruptcy Code. 
  In addition, the Plan Debtors shall pay in cash any outstanding
  reasonable trustee fees and expenses provided for under the applicable trust
  agreement.

  
	
   

  	
   

  
	
  P.                  Allowed General Unsecured Claims

  	
  ·             Treatment: On the Effective Date,
  holders of Allowed General Unsecured Claims shall (i) receive payment in
  full, in cash with postpetition interest at the Federal Judgment Rate, unless
  there is an applicable contractual rate or rate of interest under state law,
  in which case interest shall be paid at such rate of interest, provided the
  claimant satisfies certain notice requirements consistent with those terms
  contained in the Confirmed 

  

 

 

	
   

  	
  Plans or (ii) shall receive such other
  treatment permissible under section 1129 of the Bankruptcy Code.  

  
	
   

  	
   

  
	
  Q.           Partner Note GGP/Homart II, L.L.C. Claims

  	
  ·             Treatment:  On the Effective Date, at the election of
  the Plan Debtors, the Allowed Partner Note GGP/Homart II L.L.C. Claims
  (i) shall be cured and reinstated in accordance with section 1124 of the
  Bankruptcy Code, (ii) shall be satisfied in full, in cash or
  (iii) shall receive such other treatment permissible under section 1129
  of the Bankruptcy Code.  

  
	
   

  	
   

  
	
  R.            Partner Note GGP Ivanhoe, Inc. Claims

  	
  ·             Treatment: On the Effective Date,
  at the election of the Plan Debtors, the Allowed Partner Note GGP
  Ivanhoe, Inc. Claims (i) shall be cured and reinstated in
  accordance with section 1124 of the Bankruptcy Code, (ii) shall be
  satisfied in full, in cash or (iii) shall receive such other treatment
  permissible under section 1129 of the Bankruptcy Code.  In the event the holders of Allowed Partner
  Note GGP Ivanhoe, Inc.  Claims are
  reinstated, the guaranty currently securing the obligations under the GGP
  Ivanhoe, Inc. Partner Note shall be affirmed and shall continue post
  emergence. 

  
	
   

  	
   

  
	
  S.             GGP TRS Retained Debt Claims

  	
  ·             Treatment:  On the Effective Date, the joint venture
  agreement between GGP LP and TRS JV Holdco, LLC shall be assumed, and the
  Plan Debtors shall make any cure payments required thereunder. 

  
	
   

  	
   

  
	
  T.             Allowed Project Level Debt Guaranty Claims(2)

  	
  ·             Treatment:  On the Effective Date, at the election of
  the Plan Debtors, the holders of allowed Project Level Debt Guaranty Claims
  shall receive a replacement guaranty or such other treatment under the Plan
  as contemplated by the Confirmed Plans. 

  
	
   

  	
   

  
	
  U.             Allowed Hughes Heirs Obligations

  	
  ·             Treatment:  On the Effective Date, the holders of
  allowed Hughes Heirs Obligations shall receive property of a value
  (a) as agreed to by the Debtors and such holders or (b) ordered by
  the Bankruptcy Court, in satisfaction of the allowed amount of their claims
  or interests; provided that, to
  the extent permissible, the Hughes Heirs Obligations may be satisfied, in
  whole or in part, through the issuance of GGO Stock.

  
	
   

  	
   

  
	
  V.            Intercompany Obligations

  	
  ·             Treatment: On the Effective
  Date, Intercompany Obligations shall be reinstated and treated in the
  ordinary course of business or eliminated in the ordinary course of business,
  including the elimination 

  

 

(2) Allowed Project
Level Debt Guaranty Claims include Existing Credit Enhancement Claims (as such
term is defined in the Confirmed Plans) with respect to the Special
Consideration Properties (as such term is defined in the Confirmed Plans).

 

 

	
   

  	
  of any Intercompany Obligations owed to or from
  any entities to be transferred to GGO.

  
	
   

  	
   

  
	
  W.        GGPLP LLC Preferred Equity Interests 

  	
  ·             Treatment: On the Effective Date,
  the holder of GGPLP LLC preferred equity interests (“GGPLP LLC Preferred
  Equity Interests”) will receive (i) (a) a distribution of Cash
  based on its share of dividends accrued and unpaid prior to the Effective
  Date and (b) reinstatement of its preferred units in Reorganized GGPLP
  LLC, which shall be in the same number of preferred units in Reorganized
  GGPLP LLC as it held as of the Record Date in GGPLP LLC or (ii) if the
  Bankruptcy Court determines that holders of such interests are impaired, such
  other treatment as is required under section 1129(b) of the Bankruptcy
  Code, less any applicable tax withholding as required by the applicable
  agreements.  

  
	
   

  	
   

  
	
  X.            GGPLP Preferred Equity Interests 

  	
  ·             Treatment:  On the Effective Date, holders of GGPLP
  Preferred Equity Interests will receive (i) (a) a distribution of
  Cash based on their pro rata share of dividends accrued and unpaid prior to
  the Effective Date, (b) reinstatement of their preferred units in
  Reorganized GGPLP, which shall be in the same number of preferred units in
  Reorganized GGPLP as they held as of the Record Date in GGPLP, provided,
  however, that any prepetition direct or indirect redemption rights which may
  have, at GGP’s option, been satisfied in shares of GGP Common Stock or 8.5%
  Cumulative Convertible Preferred Stock, Series C, as applicable, shall,
  in accordance with the applicable provisions of their prepetition agreements,
  subsequently be satisfied, at New GGP’s option, in shares of New GGP Common
  Stock or New GGP Series C Preferred Stock, as applicable, on terms
  consistent with such prepetition agreements and (c) a pro rata amount of
  Spinco Common Stock as if such holder of GGP LP Preferred Equity Units had
  converted to GGP LP Common UPREIT Units immediately prior to the Distribution
  Record Date or (ii) if the Bankruptcy Court determines that holders of
  such interests are impaired, such other treatment as is required under
  section 1129(b) of the Bankruptcy Code, less any applicable tax
  withholding as required by the applicable agreements. 

  
	
   

  	
   

  
	
  Y.             GGPLP Common UPREIT Units

  	
  ·             Treatment: On the Effective Date,
  holders of GGPLP Common UPREIT Units will receive (a) a distribution of
  Cash equal to $.019 per unit and may elect between
  (a) (i) reinstatement of such units in Reorganized GGPLP, which
  shall be in the same number as held as of the Record Date, provided, however,
  that any prepetition redemption or conversion rights, as applicable, held by
  such GGP LP Common UPREIT 

  

 

 

	
   

  	
  Unit holders which GGP had the obligation or
  option, as applicable, to satisfy in shares of GGP Common Stock, shall, in
  accordance with the applicable provisions of their prepetition agreement,
  subsequently be satisfied, at New GGP’s option or obligation, in shares of
  New GGP Common Stock on conversion or redemption terms consistent with such
  prepetition agreements, plus, a pro rata amount of GGO Common Stock on
  account of such units or (ii) being deemed to have converted or
  redeemed, as applicable, their GGPLP Common UPREIT Units effective the day
  prior to the Distribution Record Date in exchange for GGP Common Stock on
  terms consistent with such holder’s prepetition agreements, thereby receiving
  such treatment as if such holder owned GGP Common Stock on the Distribution
  Record Date or (b) if the Bankruptcy Court determines that holders of
  such interests are impaired, such other treatment as is required under
  section 1129(b) of the Bankruptcy Code, less any applicable tax withholding
  as required by the applicable agreements.

  
	
   

  	
   

  
	
  Z.                  GGP Common Stock 

  	
  ·             Treatment: On the Effective Date,
  each holder of GGP Common Stock shall receive its proportionate share of
  (i) the New Common Stock and (ii) the GGO Share Distribution.  

  
	
   

  	
   

  
	
  AA.        REIT Preferred Stock
  Interests

  	
  ·             On the Effective Date, holders of REIT Preferred
  Stock Interests will receive (1) a distribution of Cash based on their
  pro rata share of dividends accrued and unpaid prior to the Effective Date
  (if any) and (2) reinstatement of their REIT Preferred Stock Interests
  in the same number as they held as of the Distribution Record Date.

  
	
   

  	
   

  
	
  BB.        Outstanding Warrants 

  	
  ·             Treatment: On the Effective Date,
  the outstanding Warrants (as such term is defined in the Investment
  Agreements) shall be cancelled and each holder of the Warrants (or certain
  qualifying affiliates) shall receive fully vested warrants to purchase New Common
  Stock and fully vested warrants to purchase GGO Common Stock, in each case,
  in such numbers and on such terms as provided in the applicable Investment
  Agreement. 

  
	
   

  	
   

  
	
  CC.        Outstanding Options

  	
  ·             Treatment: On the Effective Date,
  the Debtors shall assume outstanding prepetition option awards to purchase
  GGP Common Stock, which may entitle option holders to an option to purchase
  New Common Stock and an option to purchase GGO Common Stock or a contractual
  right to elect to cash out.

  

 

 

III.                                 CLOSING DATE DEBT AND GGO PROMISSORY NOTE

 

	
  A.            Closing Date Net Debt and GGO Promissory Note

  	
  ·             The Closing Date Net Debt shall be
  determined in accordance with the CIA and the Plan and the GGO Promissory
  Note, if any, shall be issued on the Effective Date.

  

 

IV.                                OTHER PLAN TERMS

 

	
  A.            Executory Contracts and Unexpired Leases

  	
  ·             All executory contracts (including employee
  benefit plans, insurance, supply contracts, etc.) and unexpired leases
  will be assumed unless expressly rejected under the Plan or through a
  separate motion. 

  
	
   

  	
   

  
	
  B.            Provisions Concerning Resolution of Disputed, Contingent, and Unliquidated
  Claims and Claims Payable by Third Parties

  	
  ·             The Plan will contain usual and customary
  provisions for resolving disputed, contingent and unliquidated claims and
  claims payable by third parties, including (to the extent appropriate)
  provisions consistent with the terms contained in the Confirmed Plans.

  
	
   

  	
   

  
	
  C.            Employee/ Officer/ Director 
  Indemnification Obligations

  	
  ·             The Plan Debtors’ indemnification
  obligations for employees, officers, directors, trustees or managers shall be
  deemed assumed, in accordance with the provisions in the Confirmed Plans, unless
  otherwise expressly rejected by separate motion or under the Plan.  

  
	
   

  	
   

  
	
  D.            Provisions Concerning Plan Implementation

  	
  ·             The Plan shall provide for usual and
  customary means of implementation, including (to the extent appropriate)
  implementation provisions consistent with the terms contained in the
  Confirmed Plans. 

  
	
   

  	
   

  
	
  E.              Transfer Restrictions

  	
  ·             The plan shall provide that, in addition to
  the covenants set forth in the Non Control Agreement, REP shall  not
  sell, transfer or dispose of (x) any Shares, New Warrants, or shares
  issuable upon exercise of the New Warrants during the period from and after
  the Closing Date to the six (6) month anniversary of the Closing Date,
  (y) in excess of (A) 8.25% of the Shares and (B) 8.25% of the New
  Warrants or shares issuable upon exercise of the New Warrants, in the
  aggregate, during the period from and after the six (6) month
  anniversary of the Closing Date to the one (1) year anniversary of the
  Closing Date and (z) in excess of (A) 16.5% of the Shares and
  (B) 16.5% of the New Warrants or the shares issuable upon exercise of
  the New Warrants, in the aggregate (and taken together with any Transfers
  effected under clause (y)), during the period from and after the six
  (6) month anniversary of the Closing Date to the eighteen (18) month
  anniversary of the Closing Date. For clarity, Purchaser shall not be
  restricted from Transferring any Shares, New Warrants, or shares 

  

 

 

	
   

  	
  issuable upon exercise of the New Warrants from
  and after the eighteen (18) month anniversary of the Closing Date.

  
	
   

  	
   

  
	
  F.              Insurance Policies, Benefit Plans, Surety Bonds

  	
  ·             The Plan Debtors’ insurance policies,
  benefit plans, workers’ compensation claims, and surety bonds shall be
  treated in a manner consistent with that provided in the Confirmed Plans.

  
	
   

  	
   

  
	
  G.            Retention of Causes of Action

  	
  ·             All causes of action shall vest with GGP or
  GGO, as applicable

  
	
   

  	
   

  
	
  H.            Conditions for Consummation and Confirmation 

  	
  ·             Usual and customary for transactions of
  this type

  
	
   

  	
   

  
	
  I.                 Discharge, Releases and Exculpation

  	
  ·             The Plan will contain discharge, release
  and exculpation provisions in a manner consistent with those provided in the
  Confirmed Plans. 

  
	
   

  	
   

  
	
  J.              Governing Law

  	
  ·             To the extent the Bankruptcy Code or other
  federal law does not apply, New York law shall govern. 

  

 

 

EXHIBIT E

 

GGO ASSETS

 

Pursuant
to Section 2.1(a), and subject to the conditions, exceptions and
qualifications set forth therein, the Company will contribute to GGO (directly
or indirectly) the assets (and/or equity interests related thereto) listed below:

 

·                  Master Planned Communities

 

·                  Bridgeland

 

·                  Columbia — subject to
Section 2.1(e) of the Agreement and including a right of first offer
and purchase option with respect to certain office buildings in Columbia
pursuant to the terms of the development agreement that will be attached to the
Separation Agreement.  For the avoidance
of doubt, The Mall in Columbia and Gateway Overlook (including related
development rights) shall not to be transferred to GGO.

 

·                  Emerson

 

·                  Fairwoods

 

·                  Summerlin

 

·                  Woodlands — joint venture
interest

 

ARTICLE I.110 N. Wacker (leasehold
interest) — joint venture interest

 

·                  Ala Moana Tower — air rights
over existing parking deck

 

·                  Alameda Plaza, Idaho

 

·                  Allen Towne Plaza, Texas

 

ARTICLE II.Arizona 2 Office Note — A
note that will approximate the capital lease revenue from Arizona 2 Office
only; there will be no transfer to GGO of underlying properties or any
ownership or occupancy interest therein

 

·                  Bridges at Mint Hill, North
Carolina

 

·                  Century Plaza, Alabama

 

·                  Circle T Ranch &
Power Centre, Texas — joint venture interest

 

ARTICLE III.Condos Nouvelle at Natick —
rights to income from assets sold and for which a closing has occurred prior to
Closing remain with GGP

 

·                  Cottonwood Mall and
Cottonwood Square

 

·                  Elk Grove Promenade

 

 

ARTICLE IV.Fashion Show Air Rights -
Springing right to acquire an 80% ownership interest in the air above the
portions of Fashion Show Mall owned by GGP upon satisfaction of the existing
loans and guaranties at Fashion Show Mall and The Shoppes at the Palazzo as
described in and pursuant to the provisions of the Fashion Show Core Principles
document that will be attached to the Separation Agreement.

 

ARTICLE V.Golf course interests - TPC
Summerlin & TPC Canyons

 

·                  Hexalon (but not Hexalon’s
interest in General Growth Management, Inc.)

 

·                  Kendall Towne Center, Miami
— land

 

·                  Landmark Mall

 

·                  Maui Ranch property

 

·                  Park West Mall

 

·                  Princeton, New Jersey — land

 

·                  Rio West, New Mexico

 

·                  Riverwalk Market Place

 

·                  South Street Seaport

 

·                  Summerlin Centre

 

ARTICLE VI.Summerlin Hospital — joint
venture interest

 

·                  Victoria Ward

 

·                  Village of Redlands,
California (Redlands Mall and Redlands Promenade)

 

·                  Volo, Illinois — land

 

 

EXHIBIT K - FORM OF AMENDED AND RESTATED 

BROOKFIELD EQUITY COMMITMENT LETTER

 

 

[BROOKFIELD ASSET MANAGEMENT INC. LETTERHEAD]

 

	
   

  	
  August 2, 2010

  

 

REP Investments LLC 

c/o Brookfield Asset Management Inc.

Brookfield Place, Suite 300

181 Bay Street, P.O. Box 762

Toronto, Ontario M5J 2T3

Canada

 

Amended and Restated Equity Commitment Letter

 

Ladies and Gentlemen:

 

Reference is made to that certain Equity Commitment
Letter, dated as of April 19, 2010, as amended by the Amendment to the
Equity Commitment Letter dated May 3, 2010 (as so amended, the “Equity
Commitment Letter”), by and between Brookfield Asset Management Inc. (“Investor”)
and REP Investments LLC (“Purchaser”).

 

The undersigned desire to amend and restate the
Equity Commitment Letter in its entirety as follows:

 

Reference is made to that certain Amended and
Restated Cornerstone Investment Agreement, effective as of March 31, 2010,
by and between REP Investments LLC, a Delaware limited liability company (“Purchaser”),
and General Growth Properties, Inc., a Delaware corporation (“GGP”),
as the same may be amended from time to time (the “Investment Agreement”),
pursuant to which Purchaser has agreed to, among other things: (i) purchase
(the “GGP Share Purchase”) 250,000,000 shares of common stock of the
Company on the terms and subject to the conditions set forth in the Investment
Agreement and (ii) purchase 2,625,000 shares of common stock of GGO on the
terms and subject to the conditions set forth in the Investment Agreement (the
transactions referred to in clauses (i) and (ii) being referred to
herein as the “Transactions”). 
The proceeds of this Commitment, together with the (i) funds
deposited in the Escrow Accounts (as defined in the Escrow Agreements) and/or
(ii) amounts available to be drawn by Purchaser to fund the Purchase Price
and the GGO Purchase Price under Acceptable LCs, shall be used by Purchaser to
fund the Purchase Price and the GGO Purchase Price in accordance with, and
subject to the conditions contained in the Investment Agreement.  Capitalized terms used herein but not defined
herein shall have the meanings ascribed to them in the Investment Agreement
and, for purposes of this letter agreement, the “Company” shall be
deemed to refer, prior to consummation of the Plan, to GGP and, on and after
consummation of the Plan, the Reorganized Company, as the context requires.

 

1.             Commitment.  In the event of satisfaction or waiver (by
Purchaser) of the conditions precedent to Purchaser’s obligation to consummate
the Transactions set forth in Section 7.1 of the Investment Agreement and
subject to the satisfaction of the conditions set

 

 

forth below, Brookfield Asset Management Inc. (“Investor”),
hereby agrees to provide, or cause to be provided, directly or indirectly to
Purchaser at the Closing of the Transactions, an amount in cash equal to the
sum of (a) (i) $1,576,000,000 less (ii) an amount equal to the
allowed amount (inclusive of prepetition and postpetition interest at the
applicable rate provided in the Plan) of claims that are applied against the
Purchase Price in accordance with Section 1.1(a) of the Investment
Agreement against the Debtors that are held by Purchaser and its Permitted
Assigns (other than allowed claims initially funded from proceeds released from
the Escrow Accounts) and outstanding as of the Effective Date (such difference,
the “GGP Share Purchase Commitment”), solely for the purpose of funding,
and to the extent necessary to fund, the GGP Share Purchase, (b) $79,000,000
(the “GGO Share Purchase Commitment”), solely for the purpose of
funding, and to the extent necessary to fund, the purchase of the GGO Shares,
(c) up to $348,605,580 (the “GGP Rights Offering Commitment”),
solely for the purpose of funding, and to the extent necessary to fund, the
purchase of (x)(i) the number of shares of New Common Stock which
Purchaser will have the ability to acquire pursuant to Section 6.9(a)(iv) of
the Investment Agreement and (ii) 69.721% of the shares of New Common
Stock with respect to which rights are declined by holders of Common Stock in
the GGP Backstop Rights Offering pursuant to Section 6.9(a)(iii) of
the Investment Agreement or (y) Purchaser’s pro rata portion of the Bridge
Securities pursuant to Section 6.9(b) of the Investment Agreement and
(d) up to $595,238,100 (the “GGP Debt Backstop Commitment” and,
together with the GGP Share Purchase Commitment, the GGO Share Purchase
Commitment and the GGP Rights Offering Commitment, the “Commitment”),
solely for the purpose of funding, and to the extent necessary to fund,
Purchaser’s obligation to backstop for new bonds, loans or preferred stock
pursuant to Section 6.9(c) of the Investment Agreement; provided
that Investor and its Permitted Assignees (as defined below) shall not, under
any circumstances, be obligated to contribute to, purchase equity or debt of or
otherwise provide funds to Purchaser or any other Person in any amount in
excess of the Commitment.  Except as
permitted in Section 6 of this letter agreement, the Commitment may not be
amended, modified, withdrawn or revoked by Investor or Purchaser without the
prior written consent of the Company, except in the event the Investment
Agreement is terminated in accordance with its terms or this letter agreement
is terminated in accordance with its terms.

 

2.             Conditions.  (a) This letter agreement, including the
obligation of Investor to fund the Commitment, shall be subject to: (i) the
terms of this letter agreement, (ii) the concurrent consummation of the
Transactions pursuant to the Investment Agreement and (iii) the concurrent
payment to the Purchaser in an amount not less than the excess of (1) the
Purchase Price (after taking into account the allowed amount (inclusive of
prepetition and postpetition interest at the applicable rate provided in the
Plan) of claims that are applied against the Purchase Price in accordance with
Section 1.1(a) of the Investment Agreement against the Debtors that
are held by Purchaser and its Permitted Assigns and outstanding as of the
Effective Date) and the GGO Purchase Price over (2) the GGP Share Purchase
Commitment and the GGO Share Purchase Commitment consisting of (x) all
Commitment Amounts from any Escrow Accounts under the Escrow Agreements (in
each case, as such terms are defined in the Escrow Agreements) plus (y) the
aggregate face amount of any Acceptable LCs then outstanding.

 

(b) This letter agreement, and Investor’s
obligation to fund the Commitment, will terminate automatically and immediately
upon the earliest to occur of: (i) funding of the Commitment in connection
with the Closing of the Transactions, or (ii) the Termination Date.

 

2

 

3.             Third
Party Beneficiaries.  Purchaser and
Investor agree that the Company has relied on the existence of this letter
agreement and is an express third party beneficiary of the terms of this letter
agreement.  This letter agreement shall
be binding on Investor solely for the benefit of Purchaser and the Company, and
nothing set forth in this letter agreement shall be construed to confer upon or
give to any Person other than Purchaser or the Company any benefits, rights or
remedies under or by reason of, or any rights to enforce or cause Purchaser to
enforce, the Commitment or any provisions of this letter agreement.  Purchaser’s creditors shall have no right to
enforce this letter agreement or to cause Purchaser to enforce this letter
agreement.  The parties hereby agree that
their respective representations, warranties and covenants set forth herein are
solely for the benefit of the other party hereto and the Company, in accordance
with and subject to the terms of this letter agreement, and this letter
agreement is not intended to, and does not, confer upon any Person other than
the parties hereto and the Company any rights or remedies hereunder.

 

4.             No
Recourse.  Notwithstanding anything that
may be expressed or implied in this letter agreement, no Person other than
Investor shall have any obligation hereunder and, notwithstanding that Investor
may be a partnership, corporation or limited liability company, no recourse
hereunder or under any documents or instruments delivered in connection
herewith shall be had against any former, current or future controlling person,
director, officer, employee, agent, general or limited partner, manager,
member, stockholder, affiliate, representative or assignee of Investor or any
former, current or future controlling person, director, officer, employee,
agent, general or limited partner, manager, member, stockholder, affiliate,
representative or assignee of any of the foregoing, whether by the enforcement
of any assessment or by any legal or equitable proceeding, or by virtue of any
statute, regulation or other applicable law, it being expressly agreed and
acknowledged that no personal liability whatsoever shall attach to, be imposed
on or otherwise be incurred by any former, current or future controlling
person, director, officer, employee, agent, general or limited partner,
manager, member, stockholder, affiliate, representative or assignee of Investor
or any former, current or future controlling person, director, officer,
employee, agent, general or limited partner, manager, member, stockholder,
affiliate, representative or assignee of any of the foregoing, as such, for any
obligations of Investor under this letter agreement or any documents or
instrument delivered in connection herewith or for any claim based on, in
respect of, or by reason of such obligations or their creation.

 

5.             Confidentiality.  This letter agreement and the identity of
Investor in connection herewith shall be treated as confidential and is being
provided to Purchaser and, if applicable, the Company solely in connection with
the transactions contemplated by the Investment Agreement. This letter
agreement and the identity of Investor in connection herewith may not be used,
circulated, quoted or otherwise referred to, except with the written consent of
Investor and Purchaser; provided that no such written consent shall be
required (and Investor and its Affiliates shall be free to release such
information) for disclosures to Purchaser’s and Investor’s respective
Affiliates’ and Purchaser’s, Investor’s and such Affiliates’ respective
partners, members, directors, officers, employees, agents, legal, financial,
accounting or other advisors, potential debt and equity financing sources,
co-sponsors, related investment funds, consultants and other representatives,
and representatives of any thereof, so long as such persons agree to keep such
information confidential on terms substantially identical to the terms
contained in this Section 5; provided, further, that
Investor and Purchaser may disclose the

 

3

 

existence of this letter agreement (i) to the
extent required or requested, as appropriate, by law, regulation, judicial or
governmental order, subpoena or other legal process or by any governmental,
regulatory or supervisory authority or stock exchange (including, to the extent
required by law, any Governmental Entity and the applicable rules of the
New York Stock Exchange) and (ii) to the Company and its directors,
officers and advisors; provided, further, however, to the
extent that disclosure is permitted pursuant to clause (i) or (ii) of
the foregoing proviso, prior to any such disclosure thereunder, (x) the
disclosing party shall (to the extent legally permissible) provide Investor
with a reasonable opportunity to review and provide comments on (which comments
shall be considered in good faith by the disclosing party), and take reasonably
available steps to resist or limit such requirement or request resulting in,
such disclosure and (y) with respect to any disclosure to the Company, its
directors, officers and advisors (each, a “Recipient”) pursuant to such
clause (ii), such disclosure pursuant hereto and the ability of the Company to
rely on and enforce the provisions of this Section 5 shall be conditioned
on the agreement by such Recipient to keep such information confidential on
substantially identical terms to those in this Section 5 (including the
obligations set forth in clause (x) above).  Notwithstanding the foregoing, the Company and
GGP may disclose this letter agreement in any filings required to be made with
respect to the Investment Agreement or transactions contemplated thereby with
the Securities and Exchange Commission or in connection with any judicial or
administrative proceedings in the Bankruptcy Court without any additional
notice or consent of the Investor.

 

6.             Assignment.  Except as provided in this Section 6,
this letter agreement may not be assigned by any party.  With the consent of Purchaser, Investor
may assign a portion of its obligations to fund the Commitment to one or more
Affiliates and/or persons who may become members of Purchaser (the “Permitted
Assignees”), but in each case only if such assignment shall not delay or
impair the funding of the Commitment or the completion of the transactions
contemplated by the Investment Agreement; provided, however, that
no such assignment shall relieve Investor of its obligations hereunder.  Any attempted assignment in violation of this
Section 6 shall be null and void. 
This letter agreement may not be terminated, amended or otherwise
modified without the prior written consent of Purchaser, the Company and
Investor, except to reflect the addition of one or more Permitted Assignees of
all or a portion of Investor’s obligations to fund the Commitment.

 

7.             Representations
and Warranties.  Investor hereby
represents and warrants as follows:

 

(a)           Investor is duly organized, validly existing and in good
standing (to the extent its jurisdiction of organization recognizes the concept
of good standing) under the laws of its jurisdiction of organization.

 

(b)           The execution, delivery and performance of this letter
agreement by Investor is within its corporate, limited partnership, limited liability
company or comparable powers and has been duly authorized by all necessary
action, and no other proceedings or actions on the part of Investor are
necessary to perform its obligations hereunder. This letter agreement is a
valid and binding obligation of Investor enforceable against it in accordance
with its terms, except as such enforceability may be limited by bankruptcy,
insolvency, moratorium,

 

4

 

reorganizations or similar laws affecting creditors
generally or by general equitable principles (whether applied in equity or at
law).

 

(c)           The execution, delivery and performance by Investor of
this letter agreement do not and will not (i) violate the organizational
documents of Investor, (ii) violate any applicable law or regulation or
judgment, injunction, order or decree to which Investor or any of its assets
are subject or (iii) constitute a default (or an event that with notice or
lapse of time or both would become a default) under, result in any breach of or
give rise to any right of termination, cancellation, amendment or acceleration
or conflict with any right or obligation or Investor, other than, in the case
of clauses (ii) and (iii) of this Section 7(c), violations,
defaults or breaches which would not impair the ability of Investor to perform
its obligations hereunder.

 

(d)           Investor has and will have on the Closing Date the funding
necessary to fund the Commitment.

 

(e)           No notice to, registration, declaration or filing with,
exemption or review by, or authorization, order, consent or approval of, any
Governmental Entity, nor expiration or termination of any statutory waiting
period, is necessary for the consummation by Investor of the transactions
contemplated by this letter agreement.

 

(f)            The Commitment and this letter agreement reflect the
entire agreement among the parties hereto and are subject to no contingencies
or conditions other than those set forth herein and therein.  As of the date hereof, no event has occurred
which, with or without notice, lapse of time or both, would constitute a
default or breach on the part of Investor under this letter agreement.

 

8.             Governing
Law; Jurisdiction; Waiver of Jury Trial. 
This letter agreement shall be deemed to be made in and in all respects
shall be interpreted, construed and governed by and in accordance with the laws
of the State of New York applicable to contracts executed in and to be
performed therein without regard to the conflicts of law principles
thereof.  The parties hereby irrevocably
submit to the personal jurisdiction of the Bankruptcy Court (as defined in the
Escrow Agreement), solely in respect of the interpretation and enforcement of
the provisions of this letter agreement, and in respect of the transactions
contemplated hereby, and hereby waive, and agree not to assert, as a defense in
any action, suit or proceeding for the interpretation or enforcement hereof or
of any such document, that it is not subject thereto or that such action, suit
or proceeding may not be brought or is not maintainable in said courts or that
the venue thereof may not be appropriate or that this letter agreement or any
such document may not be enforced in or by such courts, and the parties hereto
irrevocably agree that all claims with respect to such action or proceeding
shall be heard and determined in such court. 
The parties hereby consent to and grant any such court jurisdiction over
the person of such parties and, to the extent permitted by law, over the
subject matter of such dispute and agree that mailing of process or other
papers in connection with any such action or proceeding in the manner provided
herein or in such other manner as may be permitted by law shall be valid and
sufficient service thereof.  If the Bankruptcy
Court determines that it does not have subject matter jurisdiction over any
action or

 

5

 

proceeding arising out of or relating to this letter
agreement, then each party (i) agrees that all such actions or proceedings
shall be heard and determined in a New York federal court sitting in The City
of New York, (ii) irrevocably submits to the jurisdiction of such court in
any such action or proceeding, (iii) agrees that it will not attempt to
deny or defeat such personal jurisdiction by motion or other request for leave
from any such court, including, without limitation, a motion to dismiss on the
grounds of forum non conveniens, (iv) agrees that it will not bring any
action arising out of or relating to this letter agreement or any of the
transactions contemplated by this letter agreement in any other court.  THE PARTIES HEREBY WAIVE TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY WITH RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF,
UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY.

 

9.             Specific
Performance; Damages.  The parties
agree that irreparable damage would occur in the event that any of the
provisions of this letter agreement were not performed in accordance with their
specific terms. It is accordingly agreed that the parties (and, for the
avoidance of doubt, the Company) shall be entitled to seek specific performance
of the terms hereof.  The parties hereby
agree that specific performance shall be the sole and exclusive remedy at law
or equity with respect to breaches by any of the parties in connection with
this letter agreement or the transactions contemplated hereby and that it may
not seek or accept any other form of relief that may be available for breach
under this letter agreement or the Other Agreements (as defined below) or
otherwise in connection with this letter agreement or the transactions
contemplated hereby (including monetary damages). The parties hereby agree not
to raise any objections to the availability of the equitable remedy of specific
performance to prevent or restrain breaches or threatened breaches of this
letter agreement by any party and to specifically enforce the terms and
provisions of this letter agreement to prevent breaches or threatened breaches
of, or to enforce compliance with, the covenants and obligations of each party
under this letter agreement. Notwithstanding any other term or condition of
this letter agreement, under no circumstance shall Investor’s maximum liability
hereunder for any reason, including its knowing and material breach of any of
its commitments set forth herein, exceed the Commitment, and such damages shall
not include any special, indirect or consequential damages.  Notwithstanding any provision of the Other
Agreements or this letter agreement to the contrary, in no event shall Investor
be liable to the Company for any damages resulting or stemming from or in any
way related to the failure of any other party to the Escrow Agreements, Acceptable
LCs or that certain Amended and Restated Limited Liability Company Agreement of
Purchaser, dated as of March 31, 2010, by and among the Original Member,
the Managing Member and the Members named therein (in each case, as such term
is defined therein) to have failed to fund such other party’s respective
commitment.

 

10.           Counterparts.  This letter agreement may be executed in any
number of counterparts (including by facsimile), each such counterpart being
deemed to be an original instrument, and all such counterparts shall together
constitute the same agreement.

 

11.           Notices.  (a) All notices or other communications
to be given hereunder to a party to this letter agreement shall be in writing
and shall be sent by delivery in person, by courier service, by electronic mail
transmission or telecopy addressed as follows or such other address as may be
substituted by notice as herein provided:

 

6

 

If to Purchaser, to:

 

REP Investments LLC

c/o Brookfield Asset Management Inc.

Brookfield Place, Suite 300

181 Bay Street, P.O. Box 762

Toronto, Ontario M5J 2T3

Canada

Attention:  Joseph S. Freedman

Telephone:  (416) 956-5182

Electronic Mail: 
jfreedman@brookfield.com

 

with copies (which shall not constitute notice) to:

 

Willkie Farr & Gallagher LLP

787 Seventh Avenue

New York, NY 10019

Attention:    Marc Abrams, Esq.

Gregory B. Astrachan, Esq.

Paul V. Shalhoub, Esq.

Facsimile: (212) 728-8111

 

Sidley Austin LLP

787 Seventh Avenue

New York, NY 10019

Attention:  
Stuart S. Koonce, Esq.

Facsimile: (212) 839-8741

 

If to the Company, to:

General Growth Properties, Inc.

110 N. Wacker Drive

Chicago, IL 60606

Attention: Ronald L. Gern, Esq.

Facsimile: 
312-960-5485

 

with a copy (which shall not constitute notice) to:

 

Weil, Gotshal & Manges LLP

767 Fifth Avenue

New York, NY 10153

Attention: Frederick S. Green, Esq.

Facsimile: (212) 310-8007

 

If to Investor, to:

 

c/o Brookfield Asset Management Inc.

 

7

 

Brookfield Place, Suite 300

181 Bay Street

P.O. Box 762

Toronto, Ontario M5J 2T3

Canada

Attention:  Joseph S. Freedman

Telephone:  (416) 956-5182

Electronic Mail: 
jfreedman@brookfield.com

 

with copies (which shall not constitute notice) to:

 

Willkie Farr & Gallagher LLP

787 Seventh Avenue

New York, NY 10019

Attention:    Marc Abrams, Esq.

Gregory B. Astrachan, Esq.

Paul V. Shalhoub, Esq.

Facsimile: (212) 728-8111

 

Sidley Austin LLP

787 Seventh Avenue

New York, NY 10019

Attention:  
Stuart S. Koonce, Esq.

Facsimile: (212) 839-8741

 

(b) Any notice given hereunder shall be deemed
to have been given upon the earliest of: (i) if delivered by hand during
business hours, on the date of delivery and (ii) one (1) day after
being sent by any recognized overnight delivery service, return receipt
requested.  In the case of notices sent
by electronic mail transmission or telecopy, such notices shall be deemed to
have been given upon receipt during Business Hours; provided,
however, that any notice sent by electronic mail transmission shall
only be effective upon confirmation (by telephone, telecopy or electronic
confirmation of receipt (other than a confirmation generated automatically))
from the person to whom such notice was sent.

 

[The remainder of this page is
intentionally left blank.]

 

8

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BROOKFIELD ASSET MANAGEMENT INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

	
  ACCEPTED AND AGREED:

  
	
   

  
	
   

  
	
  REP INVESTMENTS LLC

  
	
   

  
	
  BY:

  	
  Brookfield Asset Management Private

  
	
   

  	
  Institutional Capital Adviser (Canada) L.P., its
  managing member

  
	
   

  	
   

  
	
   

  	
  By: Brookfield Private Funds Holdings Inc., its
  general partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  

 

 

Exhibit M

 

FORM OF

NON-CONTROL AGREEMENT

 

This Non-Control Agreement (this “Agreement”)
is dated as of [·] 2010 (the “Effective Date”),
by and between General Growth Properties, Inc., a Delaware
corporation (the “Company”), [Purchaser under the Investment Agreement]
(“Investor”)(3) and any Brookfield Consortium Member who signs a
counterpart signature hereto.

 

WHEREAS, Investor has entered into that certain
Cornerstone Investment Agreement, dated as of [·], 2010 (the “Investment Agreement”),
that contemplates, among other things, the purchase by Investor and other
Brookfield Consortium Members of shares of Common Stock subject to the terms
and conditions contained therein;

 

WHEREAS, the transactions contemplated by the
Investment Agreement are intended  to assist the Company in its plans to
recapitalize and emerge from bankruptcy and is not intended to constitute a
change of control of the Company or otherwise give Investor the power to
control the business and affairs of the Company;

 

WHEREAS, as a material condition to the Company’s
and Investor’s obligations to consummate the transactions contemplated by the
Investment Agreement, the Company and Investor have agreed to execute this
Agreement; and

 

WHEREAS, certain terms used in this Agreement are
defined in Section 4.1.

 

NOW THEREFORE, in consideration of the premises and
the mutual covenants and agreements hereinafter contained, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:

 

ARTICLE I

COMPANY RELATED PRINCIPLES

 

SECTION 1.1            Board of Directors.  So long as Investor and the Investor Parties,
collectively, shall Beneficially Own more than ten percent (10%) of the
outstanding shares of Common Stock, none of Investor or the Investor Parties shall take
any action that is inconsistent with its support for the following corporate
governance principles:

 

(a)           A majority of the members of the Board shall be
Independent Directors, where “Independent Director” means a director who
satisfies all standards for independence promulgated by the New York Stock
Exchange (or the applicable exchange where shares of Common Stock are then
listed);

 

(3)  REP and other permitted Purchasers under
the Investment Agreement will sign.

 

 

(b)           the Board shall have a nominating committee, a majority of
which shall be Disinterested Directors;

 

(c)           except as regards voting to elect the Purchaser Board
Designees (as such term is defined in the Investment Agreement), in connection
with any stockholder meeting or consent solicitation relating to the election
of members of the Board, Investor shall, and shall cause the other
Investor Parties to, vote in such election of members of the Board all Common
Stock that is Beneficially Owned by the Investor Parties in proportion to the Votes Cast;

 

(d)           the Board shall consist of nine (9) members
and not be increased or reduced, unless approved by seventy-five percent (75%)  of the Board;

 

(e)           any Change in Control (other than a transaction
contemplated by Section 2.1(b)(ii)) in which a Large Stockholder or
its controlled Affiliate is the acquiror or part of the acquiror group or is
proposed to be directly or indirectly combined with the Company must be
approved by a majority of the Disinterested Directors as if it were an
Affiliated Transaction involving such Large Stockholder and by a majority of
the voting power of the stockholders (other than such Large Stockholder or its
controlled Affiliates); and

 

(f)            any Change in Control (other than a transaction contemplated
by Section 2.2(b)(v)) in which any Large Stockholder or its
controlled Affiliate receives per share consideration in its capacity as a
stockholder of the Company in excess of that to be received by other
stockholders, must be approved by a majority of the Disinterested Directors as
if it were an Affiliated Transaction involving such Large Stockholder and by a
majority of the voting power of the stockholders (other than such Large
Stockholder or its controlled Affiliates).

 

The Company shall not waive
any provisions similar to Sections 1.1(c), (e) or (f) above for any
Large Stockholder under any other agreement unless the Company grants a similar
waiver under this Agreement.

 

SECTION 1.2            Voting.

 

(a)           Subject to Sections 1.1(c), (e) and (f),
in connection with any matter being voted on at a stockholder meeting or in a
consent solicitation that the Board has recommended that the stockholders of
the Company approve, Investor and the other Investor Parties may vote the
shares of Common Stock that they Beneficially Own against or in favor of such
matter, in their sole and absolute discretion.

 

(b)           Subject to Sections 1.1(c), (e) and (f),
in connection with any matter being voted on at a stockholder meeting or in a
consent solicitation that the Board has recommended that the stockholders of
the Company not approve, Investor and the other Investor Parties
may vote the shares of Common Stock that they Beneficially Own:

 

(i)            against such matter; or

 

(ii)           in favor of such matter; provided,
however, that if Investor and the other Investor Parties (taken as a
whole) Beneficially Own shares of Common Stock that represent more than the
Voting Cap of the then-outstanding Common Stock, then, with

 

2

 

respect to the shares that
account for the excess over the Voting Cap, Investor shall, and shall
cause the other Investor Parties to, vote in proportion to the Votes Cast.

 

(c)           For purposes of Section 1.2(b)(ii), the number
of shares of Common Stock that are Beneficially Owned by Investor and the
Brookfield Consortium Members shall not include any Common Stock held by any
independently operated business unit of Brookfield Asset Management Inc. or any
Affiliate thereof (each such independently operated business unit, a “Brookfield
Investment Advisor”) (i) in trust for the benefit of persons other
than Investor or any Brookfield Consortium Member, (ii) in mutual funds,
open- or closed-end investment funds or other pooled investment vehicles
sponsored, managed or advised or subadvised by such Brookfield Investment
Advisor, (iii) as agent and not principal, or (iv) in any other case
where such Brookfield Investment Advisor is disaggregated from Brookfield Asset
Management Inc. for the purposes of Section 13(d) of the Exchange
Act; provided, however, that  (A) in each case, such shares of
Common Stock were acquired in the ordinary course of business of the Brookfield
Investment Advisor’s respective investment management or securities business
and not with the intent or purpose on the part of Investor or the Brookfield
Consortium Members of influencing control of the Company or avoiding the
provisions of this Agreement and (B) where appropriate, “Chinese walls” or
other informational barriers and other procedures have been established.

 

SECTION 1.3            Related Party Transactions.

 

(a)           Without the approval of a majority of the Disinterested
Directors, Investor shall not, and shall not permit any of the Investor
Parties to (and use all reasonable efforts to cause any Affiliate of any
Investor Party not to), engage in any Affiliated Transaction.  “Affiliated Transaction” means
(i) any transaction or series of related transactions, directly or
indirectly, between the Company or any Subsidiary of the Company, on the one
hand, and any of the Investor Parties, on the other hand, or (ii) without
limiting the Company’s obligation to comply with Sections 1.5 and 1.6
hereof, with respect to the purchase or sale of Common Stock by any of the
Investor Parties, any waiver of any limitation or restriction with respect to
such purchase or sale in the Charter or the Transaction Documents, including
any exemption from the Ownership Limit (as defined in the Charter); provided,
however, that none of the following shall constitute an Affiliated
Transaction:

 

(i)            transactions expressly contemplated
in the Transaction Documents;

 

(ii)           customary compensation arrangements
(whether in the form of cash or equity awards), expense reimbursement, director
insurance coverage and/or indemnification arrangements (and related advancement
of expenses) in each case for Board designees, or any use by such persons, for
Company business purposes, of aircraft, vehicles, property, equipment or other
assets owned or customarily provided to members of the Board by the Company or
any of its Subsidiaries; and

 

(iii)          any transaction or series of
transactions if the same is in the Ordinary Course of Business and does not
involve payments by the Company in excess of [$·] in the aggregate for such transaction or
series of transactions.

 

3

 

(b)           Following the Closing (as such term is defined in the
Investment Agreement), any decisions by the Company regarding material
amendments or modifications of the Plan (as such term is defined in the
Investment Agreement) or waivers of the Company’s material rights under the
Plan, shall require the approval of the majority of Disinterested Directors to
the extent such amendment, modification or waiver relates to any Brookfield
Consortium Member’s rights or obligations.

 

SECTION 1.4          No Other Voting Restrictions.  For the avoidance of doubt, except as
restricted herein or in any Transferee Agreement or by applicable
Law, Investor and the other Investor Parties may vote the Common Stock
that they Beneficially Own
in their sole and absolute discretion.

 

SECTION 1.5          Amendment of the Charter.  The Company hereby agrees that following the
Closing Date, without the consent of Investor, the Company shall not amend (or
propose to amend) the provisions of the Charter in a manner that would:  (a) amend the restriction on Beneficial
Ownership (as such term is defined in the Charter) of the outstanding capital
stock of the Company to a level other than 9.9%; (b) amend the restriction
on Constructive Ownership (as such term is defined in the Charter) of the
outstanding capital stock of the Company to a level other than 9.9%; or
(c) amend any waiver from the restrictions set forth in the foregoing
clauses (a) and (b) granted to any Brookfield Consortium Member in
any manner adverse to any Brookfield Consortium Member.

 

SECTION 1.6          Waiver of Ownership Limited in the
Charter.  The Company and the Board shall take all appropriate and
necessary action to ensure that the ownership limitations set forth in the
Charter shall be waived with respect to Investor, the Brookfield Consortium
Members, any Brookfield Investment Advisor and any Person (other than a
transferee under Section 2.2(b)(vi) unless such transferee
executes a Transferee Agreement) to whom Investor, any Brookfield Consortium Member
or any Brookfield Investment Advisor has transferred any of the Common Stock or
Warrants in accordance with the terms of this Agreement and the Investment
Agreement, provided, insofar as the waiver relates to Investor, a
Brookfield Consortium Member, a Brookfield Investment Advisor or any
transferee, as the case may be, who owns (or would, following such transfer,
own) interests in excess of the Ownership Limit (as defined in the Charter),
that the Company has been provided with a certificate containing the
representations and covenants set forth on Exhibit D to the
Investment Agreement (or, to the extent necessitated by the organizational
structure of the party providing such certificate, a certificate substantially
similar to such Exhibit D) from such Investor, Brookfield
Consortium Member, Brookfield Investment Advisor or transferee, or in the case
of a transferee, a certificate containing the representations and covenants set
forth on Exhibit D to the Investment Agreement (or, to the extent
necessitated by the organizational structure of the party providing such
certificate, a certificate substantially similar to Exhibit D) as
modified to allow such transferee to own stock or other equity interests in a
tenant of the Company or its Subsidiaries to the extent such ownership would
not result in (i) the Company or any of its REIT Subsidiaries other than
GGP-Natick Trust or GGP Ivanhoe, Inc. recognizing more than $1 million of
“related party rent” in any year or (ii) GGP Natick Trust or GGP
Ivanhoe, Inc. recognizing more than $100,000 of “related party rent” in
any year.  The parties hereto agree that
the Company may, in the discretion of the Board, grant to third parties any
other waivers from restrictions set forth in the Charter.

 

4

 

ARTICLE II

 

INVESTOR RELATED COVENANTS

 

SECTION 2.1            Ownership Limitations.

 

(a)           Except as provided in Section 2.1(b), Investor
agrees that it (together with the other Investor Parties) shall not acquire
Economic Ownership of shares of Common Stock that would result in the Investor
Parties in the aggregate Economically Owning a percentage of the
then-outstanding Common Stock on a Fully Diluted Basis that is greater than the
Ownership Cap.  For the avoidance of
doubt, no Person shall be in violation of this Section 2.1 as a
result of (i) any acquisition by the Company of any Common Stock;
(ii) any change in the percentage of the Investor Parties’ Economic
Ownership of Common Stock that results from a change in the aggregate number of
shares of Common Stock outstanding; or (iii) any change in the number of
shares of Common Stock Economically Owned by the Investor Parties as a result
of any anti-dilution adjustments to any Equity Securities (as defined in the
Investment Agreement) Economically Owned by any Investor Party.

 

(b)           Notwithstanding Section 2.1(a), any of the
Investor Parties may acquire Economic Ownership of shares of Common Stock that
would result in the Investor Parties (taken as a whole) having Economic
Ownership of a percentage of the then-outstanding Common Stock on a Fully
Diluted Basis that is greater than the Ownership Cap under any of the following
circumstances:

 

(i)            acquisitions of shares pursuant to
any pro-rata stock dividend or stock distribution effected by the Company and
approved by a majority of the Independent Directors;

 

(ii)           if such acquisition is pursuant to a
tender offer or exchange offer, in each case that includes an offer for all
outstanding shares of Common Stock owned by the Target Stockholders, or a
merger, consolidation, binding share exchange or similar transaction pursuant
to an agreement with the Company, so long as in each case (A) such offer,
merger, consolidation, binding share exchange or similar transaction is
approved by a majority of the Disinterested Directors or by a special committee
comprised of Disinterested Directors (such tender offer or exchange offer, an “Approved Offer”, and such merger,
consolidation, binding share exchange or similar transaction, an “Approved Merger”), and (B) in
any such Approved Offer, a majority of the Target Shares are tendered into such
Approved Offer and not withdrawn prior to the final expiration of such Approved
Offer, or in such Approved Merger, a majority of the Target Shares that are
voted (in person or by proxy) on the related transaction proposal are voted in
favor of such proposal.  As used in this Section 2.1(b)(ii):  “Target
Shares” means the then-outstanding shares of Common
Stock not owned by the Investor Parties; and “Target Stockholders” means
the stockholders of the Company other than the Investor Parties.

 

(c)           The limitation set forth in Section 2.1(a) may
only be waived by the Company if a majority of the Disinterested Directors
consent thereto.

 

5

 

SECTION 2.2            Transfer Restrictions.

 

(a)           Subject to Section 2.2(b), unless approved by
a majority of the Independent Directors, Investor shall not, and shall not
permit any of the Investor Parties to sell or otherwise transfer or agree to
transfer (each of the foregoing, a “Transfer”), directly or indirectly,
any shares of Common Stock that are held directly or indirectly by Investor or
any of the other Investor Parties if, immediately after giving effect to such
Transfer, the Person that acquires such Common Stock (other than any
underwriter acting in such capacity in an underwritten public offering of such
shares) would, together with its Affiliates, to the actual knowledge (“Knowledge”)
of the transferor Beneficially Own more than ten percent (10%) of the
then-outstanding Common Stock.  A
transferor shall be deemed to have Knowledge of any transferee’s Beneficial
Ownership of Common Stock if the transferor has actual knowledge of the
identity of the transferee and such Beneficial Ownership has been, at the time
of the agreement to transfer, publicly disclosed in accordance with
Section 13 of the Exchange Act.

 

(b)           The limitations in Section 2.2(a) shall
not apply, and any Investor Party may Transfer freely:

 

(i)            to any Person (including any
Affiliate of Investor) if such Person (A) has executed and delivered to
the Company a Transferee Agreement (as defined below), and (B) has
provided the Company with a certificate containing the representations set
forth on Exhibit D of the Investment Agreement (or, to the extent
necessitated by the organizational structure of the party providing such
certificate, a certificate substantially similar to such Exhibit D)
as modified to allow such Transferee to own stock or other equity interests in
a tenant of the Company or its Subsidiaries to the extent such ownership would
not result in (i) the Company or any of its REIT Subsidiaries other than
GGP-Natick Trust or GGP Ivanhoe, Inc. recognizing more than $1 million of
“related party rent” each year or (ii) GGP-Natick Trust or GGP
Ivanhoe, Inc. recognizing more than $100,000 of “related party rent” each
year;

 

(ii)           to one or more underwriters or
initial purchasers acting in their capacity as such in a manner not intended to
circumvent the restrictions contained in Section 2.2(a);

 

(iii)          in a sale in the public market, in
accordance with Rule 144, including the volume and manner of sale
limitations set forth therein;

 

(iv)          in any Merger Transaction (other than
a transaction contemplated by Section 2.2(b)(v) below) or
transaction contemplated by clause (iii) of the definition of Change of
Control (A) in which (in either case) no Investor Party or Affiliate
thererof is the acquiror or part of the acquiring group or is proposed to be
combined with the Company and (B) that has been approved by the Board and
a majority of the stockholders (it being understood that this clause
(iv) does not affect the agreement of the parties under Sections 1.1(e) or
1.1(f));

 

(v)           in connection with a tender or
exchange offer that (A) is not solicited by any Investor Party or its
Affiliate (unless such transaction was approved in accordance

 

6

 

with Section 2.1(b)(ii))
and in which all holders of Common Stock are offered the opportunity to sell
shares of Common Stock and (B) complies with applicable securities laws,
including Rule 14d-10 promulgated under the Exchange Act; and

 

(vi)          in connection with any bona fide
mortgage, encumbrance, pledge or hypothecation of capital stock to a financial
institution in connection with any bona fide loan.

 

(c)           No Transfer under Sections 2.2(b)(i) shall be
valid unless and until the Transferee Agreement has been executed by the
Transferee and delivered to the Company. 
For the purpose of this Agreement a “Transferee Agreement” means
a new agreement executed between the Company and the Transferee (to which the
Investor is not a party) substantially in the form of this Agreement or in such
other form as is reasonably satisfactory to the Company except that:

 

(i)            notwithstanding Section 1.1(c),
in connection with any stockholder meeting or consent solicitation relating to
the election of members of the Board, any member of a Transferee Group that has
executed a Transferee Agreement may vote the shares of Common Stock that it
Beneficially Owns in favor of one director candidate in its sole and absolute
discretion and regarding any other director candidates in such election, the
Transferee must vote in proportion to the Votes Cast;

 

(ii)           references herein to “Investor” shall
be deemed to apply to Transferees and references herein to “Brookfield
Consortium Members” or “Investor Parties” shall be deemed to apply to the
Transferee’s respective Transferee Groups as the context requires (other than
in Sections 1.2(c), 1.5 and 3.1); and

 

(iii)          any obligation on the part of Investor
hereunder to cause the Investor Parties to take any action or refrain from
taking any action shall only apply to the Investor Parties controlled by the
Transferee and the Transferee Agreement shall provide that the Transferee shall
use all reasonable efforts to cause Affiliates that the Transferee does not
control to take or refrain from taking the action that it is otherwise required
to cause under this Agreement.

 

SECTION 2.3            Purchaser Board Designees.

 

(a)           Notwithstanding anything contained herein to the contrary,
the provisions in Article I (collectively, the “Stockholder
Protection Provisions”) shall be suspended and shall not apply in the event
that the Purchaser Board Designees that Investor is entitled to designate under
the terms of Section 5.10 of the Investment Agreement are not elected at a
stockholders’ meeting at which the stockholders voted on the election of such
Purchaser Board Designees (any such period, a “Suspension Period”); provided,
however, that this Section 2.3(a) shall apply only if
Investor has complied with its obligations under Section 5.10 of the
Investment Agreement, including Investor’s timely designation of Purchaser
Board Designees.  No Suspension Period shall
be deemed to occur during any reasonable period of time during which a
Purchaser Board Designee is being replaced upon the death, resignation,
retirement, disqualification or removal from office of such Purchaser Board
Designee.  Any Suspension Period shall
end upon the 

 

7

 

election of the Purchaser Board Designees that
Investor is entitled to designate under the terms of Section 5.10 of the
Investment Agreement.  At all times other
than during a Suspension Period, the Stockholder Protection Provisions shall
apply in full force and effect.

 

(b)           Notwithstanding anything contained herein or in the
Investment Agreement, no Person that acquires Common Stock from the Investor
Parties or from any other Person shall have any rights of Investor under
Section 5.10 of the Investment Agreement with respect to the designation
of members of the Board.

 

ARTICLE III

 

TERMINATION

 

SECTION 3.1            Termination of Agreement.  This Agreement may be terminated as follows
(the date of such termination, the “Termination Date”):

 

(a)           as to Investor or any Transferee, if such Person and the
Company mutually agree to terminate this Agreement, but only if the
Disinterested Directors have approved such termination;

 

(b)           upon five (5) days notice by the
Investor, at any time after (i) the Unaffiliated Stockholders Beneficially
Own more than seventy
percent (70%) of the
then-outstanding Common Stock and (ii) the Investor Parties Beneficially
Own less than fifteen
percent (15%) of the
then-outstanding Common Stock on a Fully Diluted Basis;

 

(c)           without any further action by the parties hereto, as to
Investor and the Investor Parties, if the Brookfield Consortium Members
Beneficially Own less than ten percent (10%)
of the then-outstanding Common Stock on a Fully Diluted Basis;

 

(d)           as to any Transferee, if the Transferee Group Beneficially
Owns less than 10% of the then-outstanding Common Stock on a Fully Diluted
Basis;

 

(e)           without any other action by the parties hereto, upon the
consummation of a Change of Control not involving Investor or an Investor Party
as a purchaser of any direct or indirect interest in the Company or any of its
assets or properties; provided that the Investor Parties shall not have
violated this Agreement in connection with any transaction under this clause;
and

 

(f)            without any other action by the parties hereto, upon the
consummation of: (i) a sale of all or substantially all of the assets the
Company and its Subsidiaries (determined on a consolidated basis), in one
transaction or series of related transactions; or (ii) the acquisition (by
purchase, merger or otherwise) by any Person or Group of Beneficial Ownership
of voting securities of the Company entitling such Person or Group to exercise ninety percent (90%)
or more of the total voting power of all outstanding securities entitled to
vote generally in elections of directors of the Company; provided that
the Investor Parties shall not have violated this Agreement in connection with
any transaction under the preceding clauses (i) and (ii).

 

8

 

SECTION 3.2            Procedure upon Termination.  In the event of termination pursuant to Section 3.1,
this Agreement shall terminate on the Termination Date without further action
by Investor and the Company.

 

SECTION 3.3            Effect of Termination.  In the event that this Agreement is validly
terminated as provided in this Article III, then each of the
parties hereto shall be relieved of their duties and obligations arising under
this Agreement after the date of such termination and such termination shall be
without liability to the other party; provided, however, that Article V
shall survive any such termination and shall be enforceable hereunder; provided
further, however, that nothing in this Section 3.3 shall
relieve any party hereto of any liability for a breach of a representation,
warranty or covenant in this Agreement prior to the Termination Date.

 

ARTICLE IV

 

DEFINITIONS

 

SECTION 4.1            Defined Terms.  For purposes of this Agreement, the following
terms, when used in this Agreement with initial capital letters, shall have the
respective meanings set forth in this Agreement:

 

“Affiliate” of any
particular Person means any other Person controlling, controlled by or under
common control with such particular Person. 
For the purposes of this Agreement, “control” means the possession,
directly or indirectly, of the power to direct the management and policies of a
Person whether through the ownership of voting securities, contract or
otherwise.

 

“Beneficial Ownership”
by a Person of any securities means “beneficial ownership” as used for purposes
of Rule 13d-3 adopted by the SEC under the Exchange Act; provided, however,
to the extent the term “Beneficial Ownership” is used in connection with any
obligation on the part of an Investor Party to vote, or direct the vote, of
shares of Common Stock, “Beneficial Ownership” by a Person of any securities
shall be deemed to refer solely to those securities with respect to which such
Person possesses the power to vote or direct the vote.  The term “Beneficially Own” shall have
a correlative meaning.

 

“Board” means the
Board of Directors of the Company.

 

“Brookfield Consortium
Member” shall have the meaning ascribed thereto in the Investment
Agreement.

 

“Business Day” means
any day other than (i) a Saturday, (ii) a Sunday, or (iii) any
day on which commercial banks in New York, New York are required or authorized
to close by law or executive order.

 

“Change of Control”
means any transaction involving (i) a Merger Transaction, (ii) a sale
of all or substantially all of the assets the Company and its Subsidiaries
(determined on a consolidated basis), in one transaction or series of related
transactions, or (iii) the consolidation, merger, amalgamation,
reorganization (other than pursuant to the

 

9

 

Plan contemplated by the Investment Agreement) of
the Company or a similar transaction in which the Company is combined with
another Person, unless shares of Common Stock held by holders who are not
affiliated with the Company or any entity acquiring the Company remain
unchanged or are exchanged for, converted into or constitute solely (except to
the extent of applicable appraisal rights or cash received in lieu of
fractional shares) the right to receive as consideration Public Stock and the
Persons or Group who beneficially own the outstanding Common Stock of the
Company immediately before consummation of the transaction beneficially own
more than 50% (by voting power) of the outstanding voting stock of the combined
or surviving entity or new parent immediately thereafter.

 

“Charter” means [the
Certificate of Incorporation of the Company dated as of xxxxxx xx, 2010][Insert
Charter adopted pursuant to Section 5.14(b) of the Investment
Agreement.]

 

“Common Stock”  means the common stock, par value $0.01 per
share, of the Company, as authorized by the Charter as of the Effective Date,
and any successor security as provided by Section 5.11.

 

“Disinterested Director”
shall mean (i) with respect to an Affiliated Transaction or potential
Affiliated Transaction, a director who (A) is not Affiliated with, and was
not nominated by, any Investor Party or Affiliate of an Investor Party that is
a participant in such transaction or potential transaction and (B) who has
no personal financial interest in the transaction (other than the same
interest, if a stockholder of the Company, as the other stockholders of the
Company) and (ii) with respect to any
matter other than an Affiliated Transaction, a director who is not Affiliated
with, and was not nominated by, any Investor Party.

 

“Economic Ownership”
by a Person of any securities includes ownership by any Person who, directly or
indirectly, through any contract, arrangement, understanding, relationship or
otherwise, has (i) “beneficial ownership” as defined in Rule 13d-3
adopted by the SEC under the Exchange Act or (ii) economic interest in
such security as a result of any cash-settled total return swap transaction or
any other swap, other derivative or “synthetic” ownership arrangement (in which
case the number of securities with respect to which such Person has Economic
Ownership shall be determined by the Company in it reasonable judgment based on
such Person’s equivalent net long position); provided, however,
that for purposes of determining Economic Ownership, a Person shall be deemed
to be the Economic Owner of any securities which may be acquired by such Person
pursuant to any agreement, arrangement or understanding or upon the exercise of
conversion rights, exchange rights, warrants or options, or otherwise
(irrespective of whether the right to acquire such securities is exercisable
immediately or only after the passage of time, including the passage of time in
excess of sixty (60) days, the satisfaction of any conditions, the occurrence
of any event or any combination of the foregoing).  For purposes of this Agreement, a Person
shall be deemed to be the Economic Owner of any securities Economically Owned
by any Group of which such Person is or becomes a member.  The term “Economically Own” shall have
a correlative meaning.

 

10

 

“Exchange Act” means
the Securities Exchange Act of 1934, as amended, or any successor federal
statute, and the rules and regulations of the SEC promulgated thereunder,
all as the same may be amended and shall be in effect from time to time.

 

“Fair Market Value”
means, with respect to each share of Public Stock,  the average of the daily volume weighted
average prices per share of such Public Stock for the ten consecutive trading
days immediately preceding the day as of which Fair Market Value is being determined,
as reported on the New York Stock Exchange, or if such shares are not listed on
the New York Stock Exchange, as reported by the principal U.S. national or
regional securities exchange or quotation system on which such shares are then
listed or quoted; provided, however, that in the absence of such
listing or quotations, the Fair Market Value of such shares shall be the fair
market value per share as determined by an Independent Financial Expert
appointed for such purpose, using one or more valuation methods that the
Independent Financial Expert in its best professional judgment determines to be
most appropriate, assuming such shares are fully distributed and are to be sold
in an arm’s-length transaction and there was no compulsion on the part of any
party to such sale to buy or sell and taking into account all relevant factors.

 

“Fairholme Non-Control
Agreement” means the Non-Control Agreement, dated as of the date hereof,
among the Company, [The Fairholme Fund and The Fairholme Focused Income Fund].

 

“Fully Diluted Basis”
means all outstanding shares of the Common Stock assuming the exercise of all
outstanding Share Equivalents, without regard to any restrictions or conditions
with respect to the exercisability of such Share Equivalents.

 

“Governmental Entity”
means any (i) nation, region, state, province, county, city, town,
village, district or other jurisdiction, (ii) federal, state, local,
municipal, foreign or other government, (iii) governmental or
quasi-governmental authority of any nature (including any governmental agency,
branch, department, court or tribunal, or other entity), (iv) multinational
organization or body or (v) body entitled to exercise any administrative,
executive, judicial, legislative, police, regulatory or taxing authority or
power of any nature or any other self-regulatory organizations.

 

“Group” has the
meaning assigned to it in Section 13(d)(3) of the Exchange Act and
Rule 13d-5 thereunder.

 

“Independent Financial
Expert” means a nationally recognized financial advisory firm approved by a
majority of the Disinterested Directors.

 

“Investor Parties”
means (i) with respect to any Brookfield Consortium Member that is a party
to this Agreement or has executed a Transferee Agreement, the Brookfield
Consortium Members and (ii) with respect to each Transferee that has
executed a Transferee Agreement, the applicable Transferee Group; provided,
however, that none of the Company, any Subsidiary of the Company or any
Brookfield Investment Advisor shall be deemed to be an Investor Party.

 

11

 

“Large
Stockholder” means a Person that is the Beneficial Owner of more than ten
percent (10%) of the outstanding shares of Common Stock on a Fully Diluted
Basis.

 

“Law” means any
statutes, laws (including common law), rules, ordinances, regulations, codes,
orders, judgments, decisions, injunctions, writs, decrees, applicable to the
Company, Common Stock or Investor Parties.

 

“Merger Transaction”
means any transaction involving the acquisition (by purchase, merger or
otherwise) by any Person or Group of Beneficial Ownership of voting securities
of the Company entitling such Person or Group to exercise a majority of the
total voting power of all outstanding securities entitled to vote generally in
elections of directors of the Company.

 

“Ordinary Course of
Business” means the ordinary and usual course of day-to-day operations of
the business of the Company consistent with past practice.

 

“Ownership Cap” means
(i) with respect to the Brookfield Consortium Members, forty-five percent (45%) and (ii) with
respect to each Transferee, the lower of (x) forty-five
(45%) of the then-outstanding
Common Stock on a Fully Diluted Basis and (y) the sum of five percent (5%) and the
percentage of the outstanding Common Stock on a Fully Diluted Basis that the
Transferee Economically Owns as of (and after giving effect to) such Transfer.

 

“Pershing Non-Control
Agreement” means the Non-Control Agreement, dated the date hereof, among
the Company, [Pershing Square, L.P., Pershing Square II, L.P., Pershing Square
International, Ltd. and Pershing Square International V, Ltd.]

 

“Person” means an
individual, a group (including a “group” under Section 13(d) of the
Exchange Act), a partnership, a corporation, a limited liability company, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization and a Governmental Entity or any department, agency or political
subdivision thereof.

 

“Public Stock” means
common stock listed on a recognized U.S. national securities exchange with an
aggregate market capitalization (held by non-Affiliates of the issuer) in
excess of $1 billion in Fair Market Value.

 

“Rule 144” means
Rule 144 promulgated by the SEC under the Securities Act, or any successor
rule or regulation hereafter adopted by the SEC, as the same may be
amended and shall be in effect from time to time.

 

“SEC” means the
Securities and Exchange Commission or any other federal agency then
administering the Exchange Act, the Securities Act and other federal securities
laws.

 

“Securities Act”
means the Securities Act of 1933, as amended, or any successor federal statute,
and the rules and regulations of the SEC promulgated thereunder, all as
the same may be amended and shall be in effect from time to time.

 

12

 

“Share Equivalent”
means any stock, warrants, rights, calls, options or other securities
exchangeable or exercisable for, or convertible into, shares of Common Stock.

 

“Subsidiary” means,
with respect to a Person, any corporation, limited liability company,
partnership, trust or other entity of which such Person owns (either alone,
directly, or indirectly through, or together with, one or more of its
Subsidiaries) 50% or more of the equity interests the holder of which is
generally entitled to vote for the election of the board of directors or
governing body of such corporation, limited liability company, partnership,
trust or other entity.

 

“Unaffiliated
Stockholders” means, as of the date of the action in question, any Person
not Affiliated with Brookfield Asset Management, Inc., Fairholme Capital
Management LLC, Pershing Capital Management L.P., any transferee who is a party
to a Transferee Agreement or any of their respective Affiliates.

 

“Transaction Documents”
means, individually or collectively, the Investment Agreement or the Warrant.

 

“Transferee” means,
any proposed transferee of securities pursuant to Sections 2.2(b)(i) or
2.2(b)(vi).

 

“Transferee Group”
means, with respect to (i) any Transferee that is a Brookfield Consortium
Member, any Brookfield Consortium Member or (ii) any other Transferee
(other than Transferees that are Brookfield Consortium Members), such
Transferee, its Affiliates and any Person of which such Transferee is a general
partner, managing member or equivalent thereof.

 

“Votes
Cast” means the aggregate number of shares of Common Stock that are
properly voted for or against any action to be taken by stockholders, excluding
any shares if the holder of such shares is contractually required to vote in
proportion of the total number of votes cast pursuant to this Agreement, the
Fairholme Non-Control Agreement, the Pershing Non-Control Agreement or any
transferee agreement executed hereunder or thereunder.

 

“Voting Cap” means
(i) with respect to the Brookfield Consortium Members, 30% and (ii) with
respect to any Transferee Group, the lower of (x) 30% of the
then-outstanding Common Stock on a Fully Diluted Basis and (y) the sum of
5% and the percentage of the outstanding Common Stock on a Fully Diluted Basis
that the Transferee Beneficially Owns as of (and after giving Effect to) such
Transfer.

 

“Warrants” means the
New Warrants (as defined in the Investment Agreement).

 

13

 

ARTICLE V

 

MISCELLANEOUS

 

SECTION 5.1       Notices. All notices and other
communications in connection with this Agreement shall be in writing and shall
be considered given if given in the manner, and be deemed given at times, as
follows:  (a) on the date delivered,
if personally delivered; (b) on the day of transmission if sent via
facsimile transmission to the facsimile number given below, and telephonic
confirmation of receipt is obtained promptly after completion of transmission;
or (c) on the next Business Day after being sent by recognized overnight
mail service specifying next business day delivery, in each case with delivery
charges pre-paid and addressed to the following addresses:

 

If to Investor, to:

 

REP Investments LLC

c/o Brookfield Asset Management Inc.

Brookfield Place, Suite 300

181 Bay Street

P.O. Box 762

Toronto, Ontario M5J 2T3

Canada

Attention: Joseph Freedman

Facsimile: (416) 365-9642

 

with a copy (which shall not
constitute notice) to:

 

Willkie Farr &
Gallagher LLP

787 Seventh Avenue

New York, NY 10019

Attention:    Marc Abrams, Esq.

Gregory B. Astrachan, Esq.

Paul V. Shalhoub, Esq.

Facsimile: (212) 728-8111

 

If to Company, to:

 

General Growth Properties, Inc.

110 N. Wacker Drive

Chicago, IL 60606

Attention: Ronald L. Gern, Esq.

Facsimile: 312-960-5485

 

with a copy (which shall not
constitute notice) to:

 

Weil, Gotshal &
Manges LLP

767 Fifth Avenue

 

14

 

New York, NY 10153

Attention:    Marcia L. Goldstein, Esq.

Frederick S. Green, Esq.

Gary T. Holtzer, Esq.

Malcolm E. Landau, Esq.

Facsimile:
(212) 310-8007

 

SECTION 5.2                    Assignment; No Third Party Beneficiaries.  Neither this Agreement nor any of the rights,
interests or obligations under this Agreement may be assigned by any party
without the prior written consent of the other party.  This Agreement (including the documents and
instruments referred to in this Agreement) is not intended to and does not
confer upon any person other than the parties hereto any rights or remedies
under this Agreement.

 

SECTION 5.3                    Prior Negotiations; Entire Agreement.  This Agreement (including the exhibits hereto
and the documents and instruments referred to in this Agreement) constitutes
the entire agreement of the parties hereto and supersedes all prior agreements,
arrangements or understandings, whether written or oral, between the parties
hereto with respect to the subject matter of this Agreement.

 

SECTION 5.4                    Governing Law; Venue.  THIS AGREEMENT, AND ALL CLAIMS OR CAUSES OF
ACTION (WHETHER IN CONTRACT OR TORT) THAT MAY BE BASED UPON, ARISE OUT OF
OR RELATE TO THIS AGREEMENT OR THE NEGOTIATION, EXECUTION OR PERFORMANCE OF
THIS AGREEMENT WILL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF DELAWARE.  BOTH
PARTIES HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF, AND VENUE IN,
DELAWARE AND WAIVES ANY OBJECTION BASED ON FORUM NON CONVENIENS.

 

SECTION 5.5                    Counterparts.  This Agreement may be executed in any number
of counterparts, all of which shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each of the
parties hereto, and delivered to the other party (including via facsimile or
other electronic transmission), it being understood that each party need not
sign the same counterpart.

 

SECTION 5.6                    Expenses.  Except as otherwise provided in this
Agreement, Investor and the Company shall each bear its own expenses
incurred in connection with the negotiation and execution of this Agreement and
each other agreement, document and instrument contemplated by this Agreement
and the consummation of the transactions contemplated hereby and thereby.

 

SECTION 5.7                    Waivers and Amendments.  Subject to Section 5.2, this
Agreement may be amended, modified, superseded, cancelled, renewed or extended,
and the terms and conditions of this Agreement may be waived, only by a written
instrument signed by Investor and the Company (with the approval of a majority
of the Disinterested Directors) or, in the case of a waiver, by the party
waiving compliance, and subject, to the extent required, to the approval of the
Bankruptcy Court.  No delay on the part
of any party in exercising any right, power or privilege pursuant to this
Agreement shall operate as a waiver thereof, nor shall any waiver on

 

15

 

the part of any party of any right, power or
privilege pursuant to this Agreement, nor shall any single or partial exercise
of any right, power or privilege pursuant to this Agreement, preclude any other
or further exercise thereof or the exercise of any other right, power or
privilege pursuant to this Agreement. 
The rights and remedies provided pursuant to this Agreement are
cumulative and are not exclusive of any rights or remedies which any party
otherwise may have at law or in equity.

 

SECTION 5.8                    Construction.

 

The headings in this
Agreement are for reference purposes only and shall not in any way affect the
meaning or interpretation of this Agreement.

 

Unless the context otherwise
requires, as used in this Agreement:  (i) “or”
shall mean “and/or”; (ii) “including” and its variants mean “including,
without limitation” and its variants; (iii) words defined in the singular
have the parallel meaning in the plural and vice versa; (iv) references to
“written” or “in writing” include in visual electronic form; (v) words of
one gender shall be construed to apply to each gender; and (vi) the terms
“Article” and “Section” refer to the specified Article or Section of
this Agreement.

 

SECTION 5.9                    Severability.  If any term or other provision of this
Agreement is invalid, illegal, or incapable of being enforced by any law or
public policy, all other terms or provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party.  Upon
such determination that any term or other provision is invalid, illegal, or
incapable of being enforced, the parties hereto shall negotiate in good faith
to modify this Agreement so as to effect the original intent of the parties
hereto as closely as possible in an acceptable manner in order that the
transactions contemplated hereby are consummated as originally contemplated to
the greatest extent possible.

 

SECTION 5.10              Equitable Relief.  It is hereby acknowledged that irreparable
harm would occur in the event that any of the provisions of this Agreement were
not performed fully by the parties hereto in accordance with the terms
specified herein, and that monetary damages are an inadequate remedy for breach
of this Agreement because of the difficulty of ascertaining and quantifying the
amount of damage that will be suffered by the parties hereto relying hereon in
the event that the undertakings and provisions contained in this Agreement were
breached or violated.  Accordingly, each
party hereto hereby agrees that each other party hereto shall be entitled to an
injunction or injunctions to restrain, enjoin and prevent breaches of the
undertakings and provisions hereof and to enforce specifically the undertakings
and provisions hereof in any court of the United States or any state having
jurisdiction over the matter; it being understood that such remedies shall be
in addition to, and not in lieu of, any other rights and remedies available at
law or in equity.

 

SECTION 5.11              Successor Securities.  The provisions of this Agreement pertaining
to shares of Common Stock shall apply to all shares of Common Stock
Beneficially Owned by any Investor Party and any voting equity securities of
the Company, regardless of class, series, designation or par value, that are
issued as a dividend on or in any other distribution in respect of, or as a
result of a reclassification (including a change in par value) in respect of,
shares of

 

16

 

Common Stock or other shares of the Company which,
as provided by this section, are considered as shares of Common Stock for
purposes of this Agreement and shall also apply to any voting equity security
issued by any company that succeeds, by merger, consolidation, a share
exchange, a reorganization of the Company or any similar transaction, to all or
substantially all the business of the Company, or to the ownership thereof, if
such security was issued in exchange for or otherwise as consideration for or
in respect of shares of Common Stock (or other shares considered as shares of
Common Stock, as provided by this definition) in connection with such
succession transaction.

 

SECTION 5.12              Voting Procedures.  If, in connection with any stockholder
meeting or consent solicitation, Investor or the Brookfield Consortium
Members are required under the terms of this Agreement to vote in proportion to
the Unaffiliated Stockholders, then the parties shall cooperate to determine
appropriate procedures and mechanics to facilitate such proportionate voting.

 

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17

 

IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed
and delivered by each of them or their respective officers thereunto duly
authorized, all as of the date first written above.

 

	
   

  	
  GENERAL
  GROWTH PROPERTIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
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  [REP INVESTMENTS LLC]

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
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Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00176-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00176-of-00352.parquet"}]]