Document:

Exhibit
10.5

 

TAX MATTERS AGREEMENT

 

by and between

 

General Growth Properties, Inc.

 

and

 

The Howard Hughes
Corporation

 

Dated as of November 9,
2010

 

 

TAX MATTERS AGREEMENT

 

THIS
TAX MATTERS AGREEMENT (this “Agreement”), dated as of November 9,
2010, is by and between General Growth Properties, Inc., a Delaware
corporation (“GGP”) and The Howard Hughes Corporation, a Delaware
corporation (“Spinco”).  Each of
GGP and Spinco is sometimes referred to herein as a “Party” and,
collectively, as the “Parties.”

 

WHEREAS,
the board of directors of GGP has determined that it is in the best interests
of GGP and its shareholders to create a new publicly traded company which shall
operate the Spinco Business;

 

WHEREAS,
the board of directors of GGP and the board of directors of Spinco have
approved (i) the Restructuring, and (ii) the Distribution, all as
more fully described in the Separation Agreement and the other Transaction
Documents;

 

WHEREAS,
for U.S. federal income tax purposes, certain steps of the Restructuring and
the Distribution are intended to qualify for tax-free treatment under Sections
351, 355, 368(a) and related provisions of the Code;

 

WHEREAS,
GGP has received the Private Letter Ruling from the IRS to the effect that,
among other things, (i) certain steps of the Restructuring and the
Distribution, taken together, qualify as a transaction (a) that is
described in Sections 355(a) and 368(a)(1)(G) of the Code, (b) in
which the Spinco Common Stock distributed is “qualified property” under Section 361(c) of
the Code and (c) in which the holders of GGP Common Shares recognize no
income or gain for U.S. federal income tax purposes under Section 355 of
the Code, and (ii) certain other steps of the Spinoff Plan qualify as
transactions that are described in Sections 355(a) and 368(a)(1)(G) of
the Code;

 

WHEREAS,
as a result of the Restructuring and Distribution, the Parties desire to enter
into this Agreement to provide for certain Tax matters, including the
assignment of responsibility for the preparation and filing of Tax Returns, the
payment of and indemnification for Taxes (including any Taxes incurred in
connection with the Restructuring and Distribution), entitlement to refunds of
Taxes, and the prosecution and defense of any Tax controversies;

 

NOW,
THEREFORE, in consideration of the foregoing and the terms, conditions,
covenants and provisions of this Agreement, each of the Parties mutually
covenants and agrees as follows:

 

ARTICLE I

 

DEFINITIONS

 

Section 1.01.        General.  As used in this Agreement, the following
terms shall have the following meanings:

 

 

“Accounting
Firm” has the meaning set forth in Section 9.01.

 

“Adjusted
CDND” has the meaning ascribed to it in the Investment Agreements.

 

“Adjustment”
means any proposed or final change in the Tax liability of a taxpayer.

 

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

 

“Common
Parent” means (i) for U.S. federal income tax purposes, the “common
parent corporation” of an “affiliated group” (in each case, within the meaning
of Section 1504 of the Code) filing a U.S. federal consolidated income Tax
Return, or (ii) for state, local or foreign Tax purposes, the common
parent (or the equivalent thereof) of a Tax Group.

 

“Consolidated
Return” means, with respect to the GGP Group and Spinco Group,
respectively, the U.S. federal income Tax Return required to be filed by (i) a
GGP Entity as the Common Parent or (ii) a Spinco Entity as the Common
Parent.

 

“Cornerstone
Investment Agreement” means that certain Cornerstone Investment Agreement effective
as of March 31, 2010 between REP Investments LLC and GGP, as amended to
the date hereof.

 

“Disqualifying
Action” means a GGP Disqualifying Action or a Spinco Disqualifying Action.

 

“Due
Date” means (i) with respect to a Tax Return, the date (taking into
account all valid extensions) on which such Tax Return is required to be filed
under applicable Law and (ii) with respect to a payment of Taxes, the date
on which such payment is required to be made to avoid the incurrence of
interest, penalties and/or additions to Tax.

 

“Effective
Date” means the date of the Distribution.

 

“Excess
Surplus Amount” has the meaning ascribed to it in the Investment
Agreements.

 

“Final
Determination” means the final resolution of liability for any Tax for any
taxable period, by or as a result of (i) a final decision, judgment,
decree or other order by any court of competent jurisdiction that can no longer
be appealed; (ii) a final settlement with the IRS, a closing agreement or
accepted offer in compromise under Sections 7121 or 7122 of the Code, or a
comparable agreement under the Laws of other jurisdictions, which resolves the
entire Tax liability for any taxable period; (iii) any allowance of a
refund or credit in respect of an overpayment of Tax, but only after the expiration
of all periods during which such refund or credit may be recovered by the
jurisdiction imposing the Tax; or (iv) any other final resolution,
including by reason of the expiration of the applicable statute of limitations
or the execution of a pre-filing agreement with the IRS or other Taxing
Authority.

 

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

 

2

 

“GGP
Disqualifying Action” means (i) any action (or the failure to take any
action) within its control by any GGP Entity (including entering into any
agreement, understanding or arrangement or any negotiations with respect to any
transaction or series of transactions) that, (ii) any event (or series of
events) involving the capital stock of GGP or any assets of any GGP Entity
that, or (iii) any breach by any GGP Entity of any representation,
warranty or covenant made by them in the Transaction Documents that, in each
case, would reasonably be expected to negate the Tax-Free Status of the
Transactions; provided, however, the term “GGP Disqualifying
Action” shall not include any action required by the Separation Agreement
or any other Transaction Document or that is undertaken pursuant to the
Restructuring or the Distribution.

 

“GGP
Entity” means any member of the GGP Group.

 

“GGP
Liability Percentage” means the quotient, expressed as a percentage and
rounded to two (2) decimal points, of (i) the GGP Market
Capitalization, divided by (ii) the sum of the GGP Market Capitalization
plus the Spinco Market Capitalization.

 

“GGP
Market Capitalization” means the product of (i) the volume-weighted
average trading price per share of GGP Common Shares for the twenty (20)
consecutive trading days beginning on and following the thirty-first (31st) trading
day following the Effective Time, as quoted by Bloomberg Financial Services
through its “Volume at Price” function, rounded to the nearest whole cent,
multiplied by (ii) the arithmetic average of the number of GGP Common
Shares outstanding, on a fully-diluted basis, on each of such twenty (20)
trading days, rounded to two (2) decimal points.

 

“GGP
Taxes” means any Taxes allocated to GGP pursuant to Article II.

 

“Income
Taxes” means any Taxes based upon, measured by, or calculated with respect
to net income, profits, or gains (including, but not limited to, any capital
gains, minimum Tax or any Tax on items of Tax preference, but not including
sales, use, real or personal property, excise, or transfer or similar Taxes).

 

“Indemnity
Cap” has the meaning ascribed to it in Section 2.01(b).

 

“Indemnifying
Party” means the Party from which the other Party is entitled to seek
indemnification pursuant to the provisions of Article IV.

 

“Indemnified
Party” means the Party which is entitled to seek indemnification from the
other Party pursuant to the provisions of Article IV.

 

“Independent
Firm” has the meaning set forth in Section 8.01(b).

 

“Information”
has the meaning set forth in Section 8.01(a).

 

“Information
Request” has the meaning set forth in Section 8.01(a).

 

“IRS”
means the U.S. Internal Revenue Service or any successor thereto, including,
but not limited to its agents, representatives, and attorneys.

 

3

 

“MPC
Assets” means residential and commercial lots in the “master planned
communities” owned, for federal income tax purposes, by Howard Hughes
Properties, Inc. or The Hughes Corporation or related to the Emerson
Master Planned Community.

 

“MPC
Taxes” means all liability for Income Taxes in respect of sales of MPC
assets sold prior to March 31, 2010.

 

“New
GGPI” means, after the Distribution, the publicly held corporation that
will indirectly acquire 100% of the outstanding common stock of GGP.

 

“Notified
Action” has the meaning set forth in Section 7.02(a).

 

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

 

“Past
Practice” has the meaning set forth in Section 3.03(a)(i).

 

“Pre-Closing
Period” means any taxable period ending on or before the Effective Date.

 

“Post-Closing
Period” means any taxable period beginning after the Effective Date.

 

“Refund”
means any refund (or credit in lieu thereof) of Taxes (including any
overpayment of Taxes that can be refunded or, alternatively, applied to other
Taxes payable), including any interest paid on or with respect to such refund
of Taxes.

 

“Restructuring/Distribution
Taxes” means any Taxes incurred in or by reason of the Restructuring or the
Distribution, other than Spin-Off Taxes. 
For the avoidance of doubt, Restructuring/Distribution Taxes include
Taxes by reason of deferred intercompany transactions triggered by the
Restructuring or the Distribution.

 

“Representative”
has the meaning set forth in Section 8.01(b).

 

“Response
Deadline” has the meaning set forth in Section 8.01(b).

 

“Separate
Return” means (i) in the case of the GGP Group, a Tax Return of any
GGP Entity (including any Consolidated, combined, affiliated, or unitary Tax
Return) that does not include, for any portion of the relevant taxable period,
any Spinco Entity that is a regarded entity for U.S. federal income tax
purposes and (ii) in the case of the Spinco Group, a Tax Return of any
Spinco Entity (including any Consolidated, combined, affiliated, or unitary Tax
Return) and that does not include, for any portion of the relevant taxable
period, any GGP Entity that is a regarded entity for U.S. federal income tax
purposes.

 

“Separation
Agreement” means the Separation Agreement by and between the Parties dated
as of November 9, 2010.

 

“Spin-off
Taxes” means any Taxes or other Liabilities incurred solely as a result of
the failure of the Tax-Free Status of the Transactions.

 

4

 

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

 

“Spinco
Disqualifying Action” means (i) any action (or the failure to take any
action) within its control by any Spinco Entity (including entering into any
agreement, understanding or arrangement or any negotiations with respect to any
transaction or series of transactions) that, (ii) any event (or series of
events) involving the capital stock of Spinco or any assets of any Spinco
Entity that, or (iii) any breach by any Spinco Entity of any
representation, warranty or covenant made by them in the Transaction Documents
that, in each case, would reasonably be expected to negate the Tax-Free Status
of the Transactions; provided, however, the term “Spinco
Disqualifying Action” shall not include any action required by the
Separation Agreement or any other Transaction Document or that is undertaken
pursuant to the Restructuring or the Distribution.

 

“Spinco
Entity” means any member of the Spinco Group.

 

“Spinco
Liability Percentage” means the difference, expressed as a percentage, of (i) one
hundred percent (100%) minus (ii) the GGP Liability Percentage.

 

“Spinco
Market Capitalization” means the product of (i) the volume-weighted
average trading price per share of shares of Spinco Common Stock for the twenty
(20) consecutive trading days beginning on and following the thirty-first
(31st) trading day following the Effective Time, as quoted by Bloomberg
Financial Services through its “Volume at Price” function, rounded to the
nearest whole cent, multiplied by (ii) the arithmetic average of the
number of shares of Spinco Common Stock outstanding, on a fully-diluted basis,
on each of such twenty (20) trading days, rounded to two (2) decimal
points.

 

“Spinco
Taxes” means any Taxes allocated to Spinco pursuant to Article II.

 

“Straddle
Period” means any taxable period that begins on or before and ends after
the Effective Date.

 

“Supplemental
Ruling” means a private letter ruling, without substantive qualifications,
of the IRS, to the effect that a transaction will not affect the Tax-Free
Status of the Transactions.

 

“Suspended
Deductions” means the interest deductions of The Hughes Corporation
suspended by Section 163(j) of the Code and available for use as of
the Effective Date.  Such deductions were
estimated to be approximately $406,000,000 as of December 31, 2009.  The amount of Suspended Deductions available
for use as of the Effective Date will be calculated based on an interim closing
of the books and records of The Hughes Corporation as of the close of business
on the Effective Date.

 

“Tax”
means (i) all taxes, charges, fees, duties, levies, imposts, or other similar
assessments, imposed by any U.S. federal, state or local or foreign
governmental authority, including, but not limited to, income, gross receipts,
excise, property, sales, use, license, capital stock, transfer, franchise,
payroll, withholding, social security, value added and other taxes,
(ii) any interest, penalties or additions attributable thereto and (iii) all
liabilities in respect of any 

 

5

 

items
described in clauses (i) or (ii) payable by reason of assumption,
transferee or successor liability, operation of Law or Treasury Regulation Section 1.1502-6(a) (or
any predecessor or successor thereof or any analogous or similar provision
under Law).

 

“Tax
Attributes” means net operating losses, capital losses, earnings and
profits, overall foreign losses, previously taxed income, separate limitation
losses, deferred or suspended losses or deductions, foreign tax credits or
other tax credits and all other Tax attributes.

 

“Tax Detriment” shall
mean an increase in the Tax liability of a Person for any Taxable Period.  Except as otherwise provided in this
Agreement, a Tax Detriment shall be deemed to have been realized or suffered
from a Tax Item or Items in a taxable period only if and to the extent that the
Tax liability of such Person for such period is greater than it would have been
if such Tax liability were determined without regard to such Tax Item.

 

“Tax-Free
Status of the Transactions” means the tax-free treatment accorded to
certain of the transactions taken in connection with the Restructuring and the
Distribution as set forth in the Private Letter Ruling.

 

“Tax
Group” means any U.S. federal, state, local or foreign affiliated,
consolidated, combined, unitary or similar group or fiscal unity that joins in
the filing of a single Tax Return.

 

“Taxing
Authority” means any governmental authority or any subdivision, agency,
commission or entity thereof or any quasi-governmental or private body having
jurisdiction over the assessment, determination, collection or imposition of
any Tax (including the IRS).

 

“Tax
Item” shall mean any item of income, gain, loss, deduction, credit,
recapture of credit, Tax Attribute, or any other item which may have the effect
of increasing or decreasing Taxes paid or payable.

 

“Tax
Matter” has the meaning set forth in Section 8.01(a).

 

“Tax
Package” means all relevant Tax-related information relating to the
operations of the GGP Business or the Spinco Business, as applicable, that is
reasonably necessary to prepare and file the applicable Tax Return.

 

“Tax
Proceeding” means any audit, assessment of Taxes, pre-filing agreement,
other examination by any Taxing Authority, proceeding, appeal of a proceeding
or litigation relating to Taxes, whether administrative or judicial, including
proceedings relating to competent authority determinations.

 

“Tax
Return” means any return, report, certificate, form or similar statement or
document (including any related or supporting information or schedule attached
thereto and any information return, or declaration of estimated Tax) supplied
to, or filed with, or required to be supplied to, or filed with, a Taxing
Authority with respect to Taxes.

 

6

 

“Treasury
Regulations” means the final and temporary (but not proposed) income Tax
regulations promulgated under the Code, as such regulations may be amended from
time to time (including corresponding provisions of succeeding regulations).

 

“Unqualified
Tax Opinion” means a “will” opinion, without substantive qualifications, of
a nationally recognized law firm, which law firm is reasonably acceptable to
GGP and Spinco, to the effect that a transaction will not affect the Tax-Free
Status of the Transactions.

 

Section 1.02.        Additional Definitions.

 

(a)           Capitalized terms not defined in this Agreement shall have
the meaning ascribed to them in the Separation Agreement.

 

ARTICLE II

 

ALLOCATION OF TAX LIABILITIES AND
REFUNDS

 

Section 2.01.        Allocation of Tax
Liabilities.

 

(a)           Income and Other Taxes.

 

(i)            Except as provided in Section 2.01 (d), GGP shall be
liable for all Taxes of GGP Entities for all taxable periods; provided,
that Spinco shall be liable for and shall indemnify GGP from and against all
Taxes imposed on a GGP Entity pursuant to Treasury Regulation Section 1.1502-6(a) (or
any predecessor or successor thereof or any analogous or similar provision
under Law) resulting from operations of a Spinco Entity.

 

(ii)           Except as provided in Section 2.01(b), (c) and
(d), Spinco shall be liable for all Taxes of Spinco Entities for all taxable
periods; provided that (A), notwithstanding any provision of any of the
Investment Agreements to the contrary, if Spinco is obligated to pay in cash
(after utilization of any available Tax Attributes), in the period ending 36 months
after the Effective Date, any MPC Taxes and GGP is not liable for its allocable
share of such MPC Taxes pursuant to Section 2.01(b) below as a
consequence of the Indemnity Cap, then GGP shall loan to Spinco the amount of
such MPC Taxes not payable by GGP as a consequence of the Indemnity Cap (any
such loan shall have the terms and conditions described in Section 5.17(g) of
the Cornerstone Investment Agreement); and (B) GGP shall be liable for and
shall indemnify Spinco from and against Taxes imposed on a Spinco Entity
pursuant to Treasury Regulation Section 1.1502-6(a) (or any
predecessor or successor thereof or any analogous or similar provision under
Law) resulting from operations of a GGP Entity.

 

(b)           MPC Taxes. 
Notwithstanding any provision of any of the Investment Agreements or any
provision of this Agreement or any of the other Transaction Documents to the
contrary, GGP shall be liable for 93.75% of any MPC Taxes payable in cash by
Spinco or any of its Subsidiaries; provided, however, that,
except as provided herein with respect to interest or penalties, GGP’s
liability pursuant to this Section 2.01(b) shall be capped at
the lesser of (i) $303,750,000 and (ii) the then effective Excess
Surplus Amount (if any) (the applicable amount described in clause (i) or
clause (ii) is referred to herein as the “Indemnity Cap”).  In the event 

 

7

 

that any Suspended Deductions are utilized by Spinco
or any of its Subsidiaries to offset taxable income or gain realized by Spinco
or any of its Subsidiaries other than taxable income attributable to sales of
MPC Assets sold prior to March 31, 2010, GGP’s current and future
liability, if any, pursuant to this Section 2.01(b) shall be
reduced by an amount equal to 93.75% of the incremental Taxes that would have
been payable in cash by Spinco or any of its Subsidiaries had such Suspended
Deductions not been so utilized.  In the
event that any Tax Attributes other than Suspended Deductions are utilized by
Spinco or any of its Subsidiaries to offset and reduce taxable income or gain
generated with respect to sales of MPC Assets sold prior to March 31,
2010, GGP shall be liable for 93.75% of any Income Taxes payable in cash by
Spinco or any of its Subsidiaries that would not have been so payable had such
Tax Attributes not been so utilized.  In
addition, notwithstanding any provision of the Investment Agreements or any
provision of this Agreement or any of the other Transaction Documents to the
contrary, GGP shall also be liable for one hundred percent (100%) of any
interest or penalties attributable to any MPC Taxes which interest or penalties
accrue with respect to periods ending on or before the date that Spinco assumes
control of all Tax Proceedings relating to MPC Taxes pursuant to Section 6.03
(it being understood and agreed by the parties hereto that, for purposes of
this Agreement, all penalties are deemed to accrue as of the date that the
applicable penalty has been asserted or claimed by the IRS) and GGP’s liability
for such interest or penalties shall not be limited by or subject to the
Indemnity Cap.  Spinco shall use
commercially reasonable efforts to utilize the Suspended Deductions as
expeditiously as possible and will not take any action, the principal purpose
of which is, to cause GGP’s aggregate liability pursuant to this Section 2.01(b) to
be materially greater than it would have been had such action not been taken.

 

In
order to place Spinco and GGP in the same economic position as they would have
been had certain post-Effective Date determinations been made as of the
Effective Date, the Indemnity Cap shall be re-calculated and adjusted to
reflect any such determination using the Adjusted CDND as provided in the
Investment Agreements.  Additionally, to the extent any promissory
note was issued by Spinco in favor of GGP pursuant to Section 2.01(a)(ii),
then, in order to place Spinco and GGP in the same economic position as they
would have been had the recalculated Indemnity Cap been used for purposes of
calculating such note, (i) the principal amount of such note will be
reduced based on the new calculation using the Adjusted CDND, and (ii) to
the extent applicable, any interest payments made by Spinco to GGP on such note
prior to such re-calculation shall be refunded in respect of such reductions
and accrued but unpaid interest in respect of such reductions shall be
eliminated.  Consistent with the
foregoing, this Section 2.01(b) shall be retroactively applied using
the recalculated Indemnity Cap and any resulting amounts payable thereunder
shall be promptly paid by GGP.

 

(c)           Restructuring/Distribution Taxes.

 

(i)            GGP shall be liable for all Restructuring/Distribution
Taxes.

 

(d)           Spin-Off Taxes.

 

(i)            GGP shall be liable for any Spin-Off Taxes attributable
to a GGP Disqualifying Action.

 

8

 

(ii)           Spinco shall be liable for any Spin-Off Taxes attributable
to a Spinco Disqualifying Action.

 

(iii)          Any Spin-Off Taxes that are not the result of a
Disqualifying Action shall be allocated between GGP and Spinco according to the
GGP Liability Percentage and the Spinco Liability Percentage, respectively.

 

Section 2.02.        Allocation of Refunds.

 

(a)           Except as provided in Section 2.02(b), GGP shall be
entitled to all Refunds with respect to Taxes for which GGP is or may be liable
pursuant to Article II, and Spinco shall be entitled to all Refunds of
Taxes for which Spinco is or may be liable pursuant to Article II.  A Party receiving a Refund to which the other
Party is entitled pursuant to this Agreement shall pay the amount to which such
other Party is entitled (less any costs or Taxes incurred with respect to the
receipt thereof) within ten (10) days after the receipt of such Refund.

 

(b)           To the extent that the amount of any Refund under this Section 2.02
is later reduced by a Taxing Authority or a Tax Proceeding, such reduction
shall be allocated to the Party to which such Refund was allocated pursuant to
this Section 2.02 and an appropriate adjusting payment shall be made.

 

ARTICLE III

 

PREPARATION, FILING AND
PAYMENT OF TAXES SHOWN DUE ON TAX RETURNS

 

Section 3.01.        Preparation and Filing of
Tax Returns.  GGP shall
prepare and file all Tax Returns of the GGP Group (including Consolidated
Returns of the GGP Group) relating to any taxable period and shall pay all
Taxes shown to be due and payable on such Tax Returns.  Spinco shall prepare and file all Tax Returns
of the Spinco Group (including Consolidated Returns of the Spinco Group)
relating to any taxable period and shall pay all Taxes shown to be due and
payable on such Tax Returns.

 

Section 3.02.        Amended Tax Returns.

 

(a)           Returns Filed by GGP.  GGP shall, in its sole discretion, be
permitted to amend any Tax Return that a GGP Entity is responsible for filing
pursuant to Section 3.01; provided, however, that,
unless otherwise required by Law or a Final Determination, GGP shall not amend
any such Tax Return to the extent that any such amendment would reasonably be
expected to cause a Spinco Entity to experience any Tax Detriment (including through
an increase in Taxes or a loss or reduction of a Tax Attribute regardless of
whether or when such Tax Attribute otherwise would have been used), without the
prior written consent of Spinco, which consent shall not be unreasonably
withheld or delayed.

 

(b)           Returns Filed by Spinco.  Spinco shall, in its sole discretion, be
permitted to amend any Tax Return that a Spinco Entity is responsible for
filing pursuant to Section 3.01; provided, however,
that, unless otherwise required by Law or a Final Determination, Spinco shall
not amend any such Tax Return to the extent that any such amendment would
reasonably

 

9

 

be expected to cause a GGP Entity to experience any
Tax Detriment (including through an increase in Taxes or a loss or reduction of
a Tax Attribute regardless of whether or when such Tax Attribute otherwise
would have been used) without the prior written consent of GGP, which consent
shall not be unreasonably withheld or delayed.

 

Section 3.03.        Tax Return Procedures.

 

(a)           Procedures Relating to the
Manner of Preparing Tax Returns.

 

(i)            All Tax Returns prepared by
GGP that include a member of the Spinco Group or by Spinco that include a
member of the GGP Group shall be prepared in accordance with past practices,
accounting methods, elections and conventions (“Past Practice”), unless
otherwise required by Law or agreed to in writing by Spinco or GGP, as applicable.

 

(ii)           In the event that Past
Practice is not applicable to a particular item or matter arising in a Tax
Return described in Section 3.03(a)(i), GGP or Spinco, as
applicable, shall determine the reporting of such item or matter provided that
such reporting is more likely than not to be sustained and provided further
that the other Party shall agree as to the reporting of any such item or matter
which is not more likely than not to be sustained.  The Parties shall attempt in good faith to
mutually resolve any disagreements, including by appointing an Accounting Firm
pursuant to Section 9.01, regarding such items or matters prior to the Due
Date for filing the applicable Tax Return; provided, that the failure to
resolve all disagreements prior to such date shall not relieve the Indemnified
Party of its obligation to file (or cause to be filed) such Tax Return.

 

(b)           Timing of Tax Return Filing
and Payments.  All Taxes
or Tax Returns required to be paid or filed pursuant to this Article III
by either GGP or Spinco to or with an applicable Taxing Authority shall be paid
or filed on or before the Due Date for the payment or filing of such Taxes or
Tax Returns.

 

(c)           Review of Tax Returns.  With respect to any Tax Return including
Taxes subject to indemnification pursuant to Article IV, the Indemnified
Party preparing such Tax Return shall, at least 10 days prior to the Due Date
applicable to such Tax Return, prepare and deliver to the Indemnifying Party a
schedule showing in reasonable detail the Indemnified Party’s good faith
calculation of any indemnification payments to be made by the Indemnifying
Party.  The Indemnifying Party shall have
the right to review and approve (such approval shall not be unreasonably
withheld) such schedule.  The Parties
shall attempt in good faith to mutually resolve any disagreements, including by
appointing an Accounting Firm pursuant to Section 9.01, regarding such
schedule prior to the Due Date for filing the applicable Tax Return; provided,
however, that the failure to resolve all disagreements prior to such
date shall not relieve the Indemnified Party of its obligation to file (or
cause to be filed) such Tax Return.

 

Section 3.04.        Expenses.  Except as otherwise provided in this
Agreement, each Party shall bear its own expenses incurred in connection with
this Article III.

 

10

 

ARTICLE IV

 

INDEMNIFICATION

 

Section 4.01.        Indemnification by GGP.  GGP shall pay, and shall indemnify and hold
the Spinco Indemnified Parties harmless from and against, without duplication, (i) all
GGP Taxes, (ii) all Taxes incurred by Spinco or any Spinco Entity by
reason of the breach by GGP of any of its representations, warranties or
covenants hereunder, and (iii) any costs and expenses related to the foregoing
(including reasonable attorneys’ fees and expenses).

 

Section 4.02.        Indemnification by Spinco.  Spinco shall pay, and shall indemnify and
hold the GGP Indemnified Parties harmless from and against, without
duplication, (i) all Spinco Taxes, (ii) all Taxes incurred by GGP or
any GGP Entity by reason of the breach by Spinco of any of its representations,
warranties or covenants hereunder, and (iii) any costs and expenses
related to the foregoing (including reasonable attorneys’ fees and expenses).

 

Section 4.03.        Characterization of and
Adjustments to Payments.  For
all Tax purposes, GGP and Spinco agree to treat (i) any payment required
by this Article IV (other than payments with respect to interest accruing
after the Effective Date) as either a contribution by GGP to Spinco or a
distribution by Spinco to GGP, as the case may be, occurring immediately prior
to the Effective Date or as a payment of an assumed or retained liability and (ii) any
payment of non-federal Taxes by or to a Taxing Authority or any payment of
interest as taxable or deductible, as the case may be, to the Party entitled
under this Agreement to retain such payment or required under this Agreement to
make such payment, in either case except as otherwise required by applicable
Law.

 

Section 4.04.        Timing of Indemnification
Payments. 
Indemnification payments in respect of any Liabilities for which an
Indemnified Party is entitled to indemnification pursuant to this
Article IV shall be paid by the Indemnifying Party to the Indemnified Party
(i) with respect to Liabilities requiring a payment to a Taxing Authority,
not later than one business day prior to the Due Date of such Liability, and (ii) with
respect to any other Liabilities, as such Liabilities are incurred upon demand
by the Indemnified Party, including reasonably satisfactory documentation
setting forth the basis for the amount of such indemnification payment.

 

ARTICLE V

 

CARRYBACKS, AMENDMENTS AND
TAX ITEMS

 

Section 5.01.        Carrybacks.

 

(a)           The carryback of any loss,
credit or other Tax Attribute from any Post-Closing Period shall be in
accordance with the provisions of the Code and Treasury Regulations (and any
applicable state, local or foreign Laws).

 

(b)           To the extent permitted by
applicable Law, GGP and Spinco shall waive the right to carryback any Tax
Attribute of a member of their respective Groups arising in a Post-Closing
Period to a Pre-Closing or Straddle Period; provided, however,  that (i) GGP and Spinco may carryback
any Tax Attribute if such carryback claim is reported on a Separate Return or
is 

 

11

 

utilized to offset and reduce the liability for MPC
Taxes, (ii) GGP may carryback any Tax Attribute if such carryback claim is
reported on a Consolidated Return of the GGP Group, and (iii) Spinco may
carryback any Tax Attribute if such carryback claim is reported on a
Consolidated Return of the Spinco Group.

 

(c)           In the event that,
notwithstanding Section 5.01(b), GGP or Spinco is required to carryback
Tax Attributes in order to avoid losing the benefit of such Tax Attributes, the
Party responsible for filing the Tax Return on which such carryback claim is
reported will cooperate with the other Party in seeking from the appropriate
Taxing Authority any Refund that would be allocated to the other Party pursuant
to Section 2.02 and that reasonably would result from such carryback
(including by filing an amended Tax Return) at the other Party’s cost and
expense; provided, however, that no Party shall be required or
permitted to seek such Refund to the extent that such Refund would reasonably
be expected to result in a Tax Detriment to a GGP Entity or a Spinco Entity, as
the case may be, (including through an increase in Taxes or a loss or reduction
of a Tax Attribute regardless of whether or when such Tax Attribute otherwise
would have been used), in each case, without the prior written consent of GGP
or Spinco, as applicable, which consent shall not be unreasonably withheld or
delayed.

 

Section 5.02.        Tax Items.

 

(a)           Tax Items arising in a
Pre-Closing Period shall be allocated to the GGP Group and the Spinco Group in
accordance with the Code and Treasury Regulations (and any applicable state,
local and foreign Laws) and in accordance with the allocation of Tax
Liabilities in Article II.  GGP and
Spinco shall jointly determine the allocation of such Tax Items arising in
Pre-Closing Periods as soon as reasonably practicable following the Effective
Date, and hereby agree to compute all Taxes for all Straddle Periods and
Post-Closing Periods consistently with that determination unless otherwise
required by Law or a Final Determination.

 

(b)           To the extent that the
amount of any Tax Item is later reduced or increased by a Taxing Authority or
Tax Proceeding, such reduction or increase shall be allocated to or borne by
the Party to which such Tax Item was allocated pursuant to Section 5.02(a).

 

Section 5.03.        Treatment of Deductions
Associated with Equity-Related Compensation.

 

(a)           To the extent permitted by
Law, solely GGP, New GGPI, or a GGP Entity, as the case may be, shall be
entitled to claim any Tax deduction associated with the following items:

 

(i)            The exercise of any Spinco
stock options or stock appreciation rights by any GGP Employee (as defined
below) and the vesting of Spinco restricted stock or the vesting or settlement
of Spinco restricted stock units held by any GGP Employee and the payment of
any dividends with respect to such Spinco restricted stock.

 

(ii)           The exercise of any GGP or
New GGPI stock options or stock appreciation rights by any GGP Employee and the
vesting of GGP or New GGPI restricted stock or the vesting or settlement of GGP
or New GGPI restricted stock units held by any GGP Employee (and payment of any
dividends on such GGP restricted stock).

 

12

 

(b)           To the extent permitted by
Law, solely Spinco or a Spinco Entity, as the case may be, shall be entitled to
claim any Tax deduction associated with the following items:

 

(i)            The exercise of any GGP or
New GGPI stock options or stock appreciation rights by any Spinco Employee (as
defined below) and the vesting of GGP or New GGPI restricted stock or the
vesting or settlement of GGP or New GGPI restricted stock units held by any
Spinco Employee and the payment of any dividends on such restricted stock at
any time on or after the first date any Spinco Entity employed such Spinco
Employee.

 

(ii)           The exercise of any Spinco
stock options or stock appreciation rights by any Spinco Employee and the
vesting of Spinco restricted stock or the vesting or settlement of Spinco
restricted stock units held by any Spinco Employee and the payment of any
dividends with respect to such Spinco restricted stock.

 

(c)           The following terms shall
have the following meanings:

 

(i)            “Spinco Employee” means any
person employed or formerly employed by any Spinco Entity at the time of the
exercise, vesting, settlement, disqualifying disposition or payment, as
appropriate, unless, at such time, such person is employed by a member of the
GGP Group or was more recently employed by a GGP Entity than by a Spinco
Entity;

 

(ii)           “GGP Employee” means any
person employed or formerly employed by any GGP Entity at the time of the
exercise, vesting, settlement, disqualifying disposition or payment, as
appropriate, unless, at such time, such person is a Spinco Employee.

 

ARTICLE VI

 

TAX PROCEEDINGS

 

Section 6.01.        Notification of Tax
Proceedings.  Within ten (10) days
after an Indemnified Party becomes aware of the commencement of a Tax
Proceeding that may give rise to Taxes for which an Indemnifying Party is
responsible pursuant to Article II, such Indemnified Party shall notify
the Indemnifying Party of such Tax Proceeding, and thereafter shall promptly
forward or make available to the Indemnifying Party copies of notices and
communications relating to such Tax Proceeding. 
The failure of the Indemnified Party to notify the Indemnifying Party of
the commencement of any such Tax Proceeding within such ten (10) day
period or promptly forward any further notices or communications shall not
relieve the Indemnifying Party of any obligation which it may have to the
Indemnified Party under this Agreement except to the extent that the
Indemnifying Party is actually prejudiced by such failure.

 

Section 6.02.        Statute of Limitations.  Any extension of the statute of limitations
for any Taxes or a Tax Return for any Pre-Closing Period or a Straddle Period
shall be made by the Party required to file such Tax Return or pay such Taxes
to a Taxing Authority; provided that to the extent such Taxes or Tax
Return may result in an indemnity payment pursuant to this Agreement by the
Party other than the filing Party, the Indemnifying Party may, in its
reasonable discretion, require that the filing Party extend the applicable
statute of limitations for such period as determined by the Indemnifying Party.

 

13

 

Section 6.03.        Tax Proceeding Procedures
Generally.  Except as
provided herein or in Section 6.04, each Party shall be entitled to
contest, compromise and settle any Adjustment proposed, asserted or assessed
pursuant to any Tax Proceeding involving a Tax reported (or that, it is
asserted, should have been reported) on a Tax Return that such Party is
responsible for preparing and filing (or causing to be prepared and filed)
pursuant to Article III; provided, however, that (A) GGP
shall retain exclusive control over all Tax Proceedings relating to MPC Taxes
(whether ongoing as of the date of this Agreement or not) for so long as GGP
may be liable under Section 2.01(b) for more than 50% of the total
MPC Taxes at issue in the relevant Tax Proceeding, (B) GGP may not enter
into any closing, settlement or other similar agreement with any Taxing
Authority with respect to Tax Proceedings described in the preceding clause (A) without
the prior written consent of Spinco, which consent shall not be unreasonably
withheld, (C) GGP shall keep Spinco informed in a timely manner of all
actions proposed to be taken by GGP and shall permit Spinco to observe (at its
own cost) all proceedings with respect to such Tax Proceedings, (D) GGP
shall provide Spinco with written notice reasonably in advance of, and Spinco
shall have the right to attend and participate in (at its own cost), any
scheduled meetings with any Taxing Authority with respect to such Tax
Proceedings and (E) notwithstanding the foregoing, Spinco shall have the
right (but not the obligation) to immediately assume control of any and all Tax
Proceedings relating to MPC Taxes, at its own cost and expense, if, at any time
prior to the conclusion of such Tax Proceeding, the potential liability of GGP
for MPC Taxes under the provisions set forth in Section 2.01(b) is
less than fifty percent (50%) of the total liability for MPC Taxes at issue in
the relevant Tax Proceeding.

 

Section 6.04.        Tax Proceedings in Respect
of Indemnified Taxes.

 

(a)           In General.  Notwithstanding Section 6.03, if
the Party entitled to control a Tax Proceeding is an Indemnified Party, any
defense of the Tax Proceeding shall be conducted by such Party diligently and
in good faith; provided, however, that the Indemnified Party
shall keep the Indemnifying Party informed in a timely manner of all actions
proposed to be taken by the Indemnified Party and shall permit the Indemnifying
Party to observe (at its own cost) all proceedings with respect to such Tax
Proceeding; and provided  further, that, if the applicable Tax
Proceeding (or any Adjustments proposed or asserted in connection therewith)
reasonably would be expected to give rise to an indemnity obligation in excess
of $1 million, in the aggregate, then, unless waived by the Parties in writing,
the Indemnified Party shall (a) prepare all correspondence or filings to
be submitted to any Taxing Authority or judicial authority in a manner
consistent with the Tax Return which is the subject of such Adjustment as filed
and timely provide the Indemnifying Party with copies of any such
correspondence or filings for the Indemnifying Party’s prior review and
consent, which consent shall not be unreasonably withheld, (b) provide the
Indemnifying Party with written notice reasonably in advance of, and the
Indemnifying Party shall have the right to attend and participate in (at its
own cost), any formally scheduled meetings with any Taxing Authority or
hearings or proceedings before any judicial authority with respect to such
Adjustment, (c) not enter into any closing, settlement or other similar
agreement with any Taxing Authority with respect to the relevant Tax Proceeding
(or any proposed Adjustment) without the prior written consent of the
Indemnifying Party, which consent shall not be unreasonably withheld and (d) not
contest any proposed or asserted Adjustment before a judicial authority unless (A) such
Adjustment (separately or together with other proposed or asserted Adjustments)
reasonably would be expected to give rise to Taxes payable by the Indemnified
Party in an amount of $1 million or more, in the aggregate, or (B) the 

 

14

 

Indemnified Party has received an opinion of a
nationally recognized law firm that it is more likely than not to prevail on
the merits.

 

(b)           Tax Proceedings in Respect
of Restructuring/Distribution Taxes and Disqualifying Actions.  Notwithstanding Section 6.03, GGP and
Spinco shall be entitled to jointly contest, compromise and settle any
Adjustment proposed, asserted or assessed pursuant to any Tax Proceeding
relating to (i) Restructuring/Distribution Taxes and (ii) any Taxes
attributable to a Spinco Disqualifying Action. 
Notwithstanding Section 6.03, GGP shall be entitled to contest,
compromise and settle any Adjustment proposed, asserted or assessed pursuant to
any Tax Proceeding relating to any Taxes attributable to a GGP Disqualifying
Action and shall defend such Adjustment diligently and in good faith; provided,
that, unless waived by the Parties in writing, GGP shall (i) keep
Spinco informed in a timely manner of all actions taken or proposed to be taken
by GGP, (ii) provide copies of all correspondence or filings to be submitted
to any Taxing Authority or judicial authority to Spinco for its prior review
and consent, which consent shall not be unreasonably withheld and (iii) provide
Spinco with written notice reasonably in advance of, and Spinco shall have the
right to attend (at its own cost), any formally scheduled meetings with any
Taxing Authority or hearings or proceedings before any judicial authority.

 

ARTICLE VII

 

TAX-FREE STATUS OF THE
DISTRIBUTION

 

Section 7.01.        Representations and
Warranties.

 

(a)           Tax Reporting.  Each of GGP and Spinco covenants and agrees
that it will not take, and will cause its respective Affiliates to refrain from
taking, any position on any Tax Return that is inconsistent with the Tax-Free
Status of the Transactions.

 

(b)           Restrictions Relating to the
Distribution.  Neither GGP
nor Spinco shall, nor shall GGP or Spinco permit any GGP Entity or any Spinco
Entity, respectively, to, take or fail to take, as applicable, any action that
constitutes a Disqualifying Action described in the definitions of GGP
Disqualifying Action and Spinco Disqualifying Action, respectively.

 

(c)           Ordinary Course of Business.  GGP represents that neither it nor any of its
Subsidiaries altered the manner in which they satisfied their respective Tax
payment obligations as a result of the pendency of the Restructuring and
Distribution.

 

Section 7.02.        Procedures Regarding
Opinions and Rulings.

 

(a)           If Spinco notifies GGP that
it desires to take one of the actions potentially described in Section 7.01
(a “Notified Action”), GGP shall cooperate with Spinco and use its
reasonable best efforts to seek to obtain, as expeditiously as possible, a
Supplemental Ruling or an Unqualified Tax Opinion for the purpose of permitting
Spinco to take the Notified Action unless GGP shall have waived the requirement
to obtain such ruling or opinion.  If
such a ruling is to be sought, GGP shall apply for such ruling and GGP and
Spinco shall jointly control the process of obtaining such ruling.  In no event shall GGP be required to file any
such request unless Spinco represents that (i) it has read such request,
and (ii) all information and 

 

15

 

representations, if any, relating to any member of
the Spinco Group, contained in such request documents are (subject to any
qualifications therein) true, correct and complete.  Spinco shall reimburse GGP for all reasonable
costs and expenses incurred by the GGP Group in obtaining a Supplemental Ruling
or Unqualified Tax Opinion requested by Spinco within ten (10) days after
receiving an invoice from GGP therefor.

 

(b)           GGP shall have the right to
obtain a Supplemental Ruling or an Unqualified Tax Opinion at any time in its
sole and absolute discretion. If GGP determines to obtain such ruling or
opinion, Spinco shall (and shall cause each Spinco Entity to) cooperate with
GGP and take any and all actions reasonably requested by GGP in connection with
obtaining such ruling or opinion (including by making any representation or
reasonable covenant or providing any materials requested by the IRS or the law
firm issuing such opinion); provided that Spinco shall not be required to make
(or cause a Spinco Entity to make) any representation or covenant that is
inconsistent with historical facts or as to future matters or events over which
it has no control. In connection with obtaining such ruling, GGP shall apply
for such ruling and shall have sole and exclusive control over the process of
obtaining such ruling.  GGP shall
reimburse Spinco for all reasonable costs and expenses incurred by the Spinco
Group in obtaining a Supplemental Ruling or Unqualified Tax Opinion requested
by GGP.

 

(c)           Except as provided in
Sections 7.02(a) and (b), no Spinco Entity shall seek any guidance from
the IRS or any other Tax Authority (whether written, verbal or otherwise) at
any time concerning the Restructuring or Distribution (including the impact of
any transaction on the Restructuring or Distribution).

 

ARTICLE VIII

 

COOPERATION

 

Section 8.01.        General Cooperation.

 

(a)           Subject to Section 8.03,
the Parties shall each cooperate fully (and each shall cause its respective
Subsidiaries to cooperate fully) with all reasonable requests in writing (“Information
Request”) from another Party hereto, or from an agent, representative or
advisor to such Party, in connection with the preparation and filing of Tax
Returns (including the preparation of Tax Packages), claims for Refunds, Tax
Proceedings, and calculations of amounts required to be paid pursuant to this
Agreement, in each case, related or attributable to or arising in connection
with Taxes of any of the Parties or their respective Subsidiaries covered by
this Agreement and the establishment of any reserve required in connection with
any financial reporting (a “Tax Matter”).  Such cooperation shall include the provision
of any information reasonably necessary or helpful in connection with a Tax
Matter (“Information”) and shall include, without limitation, at each
Party’s own cost:

 

(i)            the provision of any Tax
Returns of the Parties and their respective Subsidiaries, books, records
(including information regarding ownership and Tax basis of property),
documentation and other information relating to such Tax Returns, including
accompanying schedules, related work papers, and documents relating to rulings
or other determinations by Taxing Authorities;

 

16

 

(ii)           the execution of any
document (including any power of attorney) in connection with any Tax
Proceedings of any of the Parties or their respective Subsidiaries, or the
filing of a Tax Return or a Refund claim of the Parties or any of their
respective Subsidiaries;

 

(iii)          the use of the Party’s
reasonable best efforts to obtain any documentation in connection with a Tax
Matter; and

 

(iv)          the use of the Party’s
reasonable best efforts to obtain any Tax Returns (including accompanying
schedules, related work papers, and documents), documents, books, records or
other information in connection with the filing of any Tax Returns of any of
the Parties or their Subsidiaries.

 

Each
Party shall make its employees, advisors, and facilities available, without
charge, on a reasonable and mutually convenient basis in connection with the
foregoing matters.

 

(b)           Subject to Section 8.03,
with respect to any written request by a Party in accordance with the
provisions of Section 8.01(a) for access to Information or Representatives
of the other Party and members of such other Party’s Tax Group in connection
with any Tax Return, Tax Proceeding or otherwise in connection with this
Agreement:

 

(i)            The responding Party shall (A) make
available to the requesting Party the requested Information within the deadline
reasonably agreed upon by the Parties (the Response Deadline”), and (B) following
the Response Deadline, promptly (and no later than five (5) days following
its discovery of such Information) make available to the requesting Party any
other Information it discovers that is within its possession or control which
would reasonably be expected to be relevant to the Information Request.

 

(ii)           In the event that the
responding Party breaches its obligations under the preceding sentence by (A) failing
to respond to the Information Request by the Response Deadline without
providing a legitimate reason for such failure that is reasonably satisfactory
to the requesting Party (provided, that the provision of Information by
the responding Party after the Response Deadline pursuant to paragraph (b)(i)(B) shall
not be deemed to be a breach described in this clause (A)) or (B) withholding
Information within its possession or control that is material to the
Information Request, then the provisions of paragraph (b)(iii) shall
apply.

 

(iii)          In the event of a breach
described in paragraph (b)(ii)(A) that is not cured within ten (10) days
following the Response Deadline or an alleged breach described in Paragraph
(b)(ii)(B), the requesting Party shall have the right to engage an independent
consulting, accounting or law firm selected in its sole discretion (the “Independent
Firm”) to access any and all books, records and other documents of the
responding Party and any applicable members of such responding Party’s group or
an agent, representative or advisor of the responding Party (or such members of
their relevant group) (“Representative”) for purposes of identifying and
extracting the Information requested by the requesting Party and the responding
Party shall be required to provide to the Independent Firm access to all such
books, records and other documents and Representatives; provided, that (x) the
Independent Firm shall have executed, for the benefit of both parties, a
non-disclosure and confidentiality agreement that 

 

17

 

is in form and substance customary for similar
engagements, (y) such access shall be provided by the responding Party
only upon at least two (2) days prior written notice and during reasonable
business hours, and (z) in the event of a breach described in paragraph
(b)(ii)(A) that is not cured within ten (10) days following the
Response Deadline or a breach described in paragraph (b)(ii)(B), as determined
by the Independent Firm following its extraction of Information pursuant to
this sentence, the costs and expenses of the Independent Firm shall be borne by
(i) the responding Party in the event of a breach by the responding Party
of paragraph (b)(i), or (ii) the requesting Party in the event there has
been no breach by the responding Party of paragraph (b)(i).

 

Section 8.02.        Retention of Records.  GGP and Spinco shall retain or cause to be
retained all Tax Returns, schedules and workpapers, and all material records or
other documents relating thereto in their possession, until sixty (60) days
after the expiration of the applicable statute of limitations (including any
waivers or extensions thereof) of the taxable periods to which such Tax Returns
and other documents relate or until the expiration of any additional period
that any Party reasonably requests, in writing, with respect to specific
material records or documents.  A Party
intending to destroy any material records or documents shall provide the other
Party with reasonable advance notice and the opportunity to copy or take
possession of such records and documents. 
The Parties hereto will notify each other in writing of any waivers or
extensions of the applicable statute of limitations that may affect the period
for which the foregoing records or other documents must be retained.

 

Section 8.03.        Confidentiality.  Notwithstanding any other provision of this
Agreement or any other Transaction Document, any information obtained by either
Party under this Agreement shall be kept confidential, except as may be
necessary in connection with the filing of Tax Returns or claims for Refunds or
in connection with any Tax Proceeding or any dispute, proceeding, suit or
action concerning any issues or matters addressed in this Agreement, or unless
a Party is compelled to disclose information by judicial or administrative
process, or, in the opinion of its counsel, by other requirements of Law.  Spinco shall not be required to make
available to GGP or its representatives any books, records, documents or other
information that Spinco reasonably determines to be subject to attorney-client
privilege; provided, however, that Spinco shall be required to
make available to GGP any information reasonably requested by GGP pursuant to Section 8.01
in connection with the preparation of any Tax Return required to be prepared by
GGP pursuant to this Agreement or any Tax Proceeding in connection with such
Tax Returns.  GGP shall not be required
to make available to Spinco or its representatives any books, records,
documents or other information that GGP reasonably determines to be subject to
attorney-client privilege; provided, however, that GGP shall be
required to make available to Spinco any information reasonably requested by
Spinco pursuant to Section 8.01 in connection with the preparation of any
Tax Return required to be prepared by Spinco pursuant to this Agreement or any
Tax Proceeding in connection with such Tax Returns.

 

ARTICLE IX

 

MISCELLANEOUS

 

Section 9.01.        Dispute Resolution.  Other than as set forth in Section 8.01(b)(iii),
with respect to any dispute between the Parties as to any matter covered by
this Agreement, the 

 

18

 

Parties shall appoint a nationally recognized
independent public accounting firm (the “Accounting Firm”) to resolve
such dispute.  In this regard, the
Accounting Firm shall make determinations with respect to the disputed items
based solely on representations made by GGP and Spinco and their respective
representatives, and not by independent review, and shall function only as an
expert and not as an arbitrator and shall be required to make a determination
in favor of one Party only.  The Parties
shall require the Accounting Firm to resolve all disputes no later than thirty
(30) days after the submission of such dispute to the Accounting Firm, but in
no event later than the Due Date for the payment of Taxes or the filing of the
applicable Tax Return, if applicable, and agree that all decisions by the
Accounting Firm with respect thereto shall be final and conclusive and binding
on the Parties.  The Accounting Firm
shall resolve all disputes in a manner consistent with this Agreement and, to
the extent not inconsistent with this Agreement, in a manner consistent with
the Past Practices of GGP and its Subsidiaries, except as otherwise required by
applicable Law.  The Parties shall
require the Accounting Firm to render all determinations in writing and to set
forth, in reasonable detail, the basis for such determination.  The fees and expenses of the Accounting Firm
shall be paid by the non-prevailing Party.

 

Section 9.02.        Tax Sharing Agreements.  All Tax sharing, indemnification and similar
agreements, written or unwritten, as between a GGP Entity, on the one hand, and
a Spinco Entity, on the other (other than this Agreement or any other
Transaction Document), shall be or shall have been terminated on or before the
Effective Date and, after the Effective Date, no GGP Entity, on the one hand,
or Spinco Entity, on the other, shall have any further rights or obligations
with respect to each other under any such Tax sharing, indemnification or
similar agreement.

 

Section 9.03.        Interest on Late Payments.  With respect to any payment between the
Parties pursuant to this Agreement not made by the due date set forth in this
Agreement for such payment, the outstanding amount will accrue interest at a
rate per annum equal to the rate in effect for underpayments under Section 6621
of the Code from such due date to and including the earlier of the ninetieth
(90th) day or the payment date and thereafter will accrue interest at a rate
per annum equal to 9%.

 

Section 9.04.        Survival of Covenants.  Except as otherwise contemplated by this
Agreement, all covenants and agreements of the Parties contained in this
Agreement shall survive the Effective Date and remain in full force and effect
in accordance with their applicable terms, provided, however, that the
representations and warranties and all indemnification for Taxes shall survive
until sixty (60) days following the expiration of the applicable statute of
limitations (taking into account all extensions thereof), if any, of the Tax
that gave rise to the indemnification, provided, further, that, in the event
that notice for indemnification has been given within the applicable survival
period, such indemnification shall survive until such time as such claim is
finally resolved.

 

Section 9.05.        Termination.  This Agreement may not be terminated except
by an agreement in writing signed by each of the Parties to this Agreement.

 

Section 9.06.        Severability.  If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced under any Law or
as a matter of public policy, all 

 

19

 

other conditions and provisions of this Agreement
shall remain in full force and effect. 
Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the Parties to this Agreement shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the Parties as closely as possible in a mutually acceptable manner.

 

Section 9.07.        Entire Agreement.  Except as otherwise expressly provided in
this Agreement, this Agreement constitutes the entire agreement of the Parties
hereto with respect to the subject matter of this Agreement and supersedes all
prior agreements and undertakings, both written and oral, between or on behalf
of the Parties hereto with respect to the subject matter of this Agreement.

 

Section 9.08.        Assignment; No Third-Party
Beneficiaries.  This
Agreement shall not be assigned by any Party without the prior written consent
of the other Party hereto, except that GGP may assign (i) any or all of
its rights and obligations under this Agreement to any of its Affiliates and (ii) any
or all of its rights and obligations under this Agreement in connection with a
sale or disposition of any assets or entities or lines of business of GGP; provided,
however, that, in each case, no such assignment shall release GGP from
any liability or obligation under this Agreement nor change any of the steps in
the Spinoff Plan.  Except as provided in Article IV
with respect to indemnified Parties, this Agreement is for the sole benefit of
the Parties to this Agreement and their respective Subsidiaries and their
permitted successors and assigns and nothing in this Agreement, express or
implied, is intended to or shall confer upon any other Person any legal or
equitable right, benefit or remedy of any nature whatsoever under or by reason
of this Agreement.

 

Section 9.09.        Specific Performance.  In the event of any actual or threatened
default in, or breach of, any of the terms, conditions and provisions of this
Agreement, the Party who is or is to be thereby aggrieved shall have the right
to specific performance and injunctive or other equitable relief of its rights
under this Agreement, in addition to any and all other rights and remedies at
law or in equity, and all such rights and remedies shall be cumulative.  The Parties agree that the remedies at law
for any breach or threatened breach, including monetary damages, may be
inadequate compensation for any loss and that any defense in any action for
specific performance that a remedy at law would be adequate is waived.  Any requirements for the securing or posting
of any bond with such remedy are waived by the Parties to this Agreement.

 

Section 9.10.        Amendment.  No provision of this Agreement may be amended
or modified except by a written instrument signed by the Parties to this
Agreement.  No waiver by any Party of any
provision of this Agreement shall be effective unless explicitly set forth in
writing and executed by the Party so waiving. 
The waiver by any Party of a breach of any provision of this Agreement
shall not operate or be construed as a waiver of any other subsequent breach.

 

Section 9.11.        Rules of Construction.  Interpretation of this Agreement shall be
governed by the following rules of construction:  (i) words in the singular shall be held
to include the plural and vice versa and words of one gender shall be held to
include the other gender as the context requires; (ii) references to the
terms Article, Section, paragraph, clause, Exhibit and 

 

20

 

Schedule are references to the Articles, Sections,
paragraphs, clauses, exhibits and schedules of this Agreement unless otherwise
specified; (iii) the terms “hereof,” “herein,” “hereby,” “hereto,” and
derivative or similar words refer to this entire Agreement, including the
Schedules and Exhibits hereto; (iv) references to “$” shall mean U.S.
dollars; (v) the word “including” and words of similar import when used in
this Agreement shall mean “including without limitation,” unless otherwise
specified; (vi) the word “or” shall not be exclusive; (vii) references
to “written” or “in writing” include in electronic form; (viii) provisions
shall apply, when appropriate, to successive events and transactions; (ix) the
table of contents and headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement; (x) GGP and Spinco have each participated in the
negotiation and drafting of this Agreement and if an ambiguity or question of
interpretation should arise, this Agreement shall be construed as if drafted
jointly by the parties hereto and no presumption or burden of proof shall arise
favoring or burdening either Party by virtue of the authorship of any of the
provisions in this Agreement or any interim drafts of this Agreement; and (xi) a
reference to any Person includes such Person’s successors and permitted
assigns.

 

Section 9.12.        Counterparts.  This Agreement may be executed in one or more
counterparts each of which when executed shall be deemed to be an original but
all of which taken together shall constitute one and the same agreement.  Delivery of an executed counterpart of a
signature page to this Agreement by facsimile or portable document format
(PDF) shall be as effective as delivery of a manually executed counterpart of
any such Agreement.

 

Section 9.13.        Coordination with the
Employee Matters Agreement.  To the extent any covenants or agreements
between the Parties with respect to employee withholding Taxes are set forth in
the Employee Matters Agreement, such Taxes shall be governed exclusively by the
Employee Matters Agreement and not by this Agreement.

 

Section 9.14.        Coordination with the
Separation Agreement.  To the
extent any representations, warranties, covenants or agreements between the
parties with respect to Taxes or other Tax matters are set forth in this
Agreement, such Taxes and other Tax matters shall be governed exclusively by
this Agreement and not by the Separation Agreement.

 

Section 9.15.        Effective Date.  This Agreement shall become effective only
upon the occurrence of the Distribution.

 

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

 

21

 

IN
WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as
of the day and year first above written.

 

	
   

  	
  GENERAL
  GROWTH PROPERTIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Thomas H. Nolan, Jr.

  
	
   

  	
  Name:

  	
  Thomas
  H. Nolan, Jr.

  
	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE
  HOWARD HUGHES CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David Arthur

  
	
   

  	
  Name:

  	
  David Arthur

  
	
   

  	
  Title:

  	
  Interim Chief Executive
  Officer

  

 

Signature Page to Tax Matters AgreementExhibit
10.6

 

 

 

SURETY BOND INDEMNITY AGREEMENT

 

dated as of November 9,
2010

 

between

 

GENERAL GROWTH PROPERTIES, INC.

 

and

 

THE HOWARD HUGHES
CORPORATION

 

 

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE I

  	
  DEFINITIONS

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 1.01.

  	
  Certain Defined Terms

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
  OBLIGATIONS
  WITH RESPECT TO SPINCO BONDS

  	
   

  	
  2

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 2.01.

  	
  Bond Payments; Indemnification

  	
   

  	
  2

  
	
  Section 2.02.

  	
  Taxes

  	
   

  	
  3

  
	
  Section 2.03.

  	
  Spinco Covenants

  	
   

  	
  3

  
	
  Section 2.04.

  	
  No Right to Set-Off

  	
   

  	
  3

  
	
  Section 2.05.

  	
  Notices

  	
   

  	
  3

  
	
  Section 2.06.

  	
  Indemnification Procedures

  	
   

  	
  3

  
	
  Section 2.07.

  	
  Dispute Resolution

  	
   

  	
  3

  
	
  Section 2.08.

  	
  Request for Discharge or Posting of Collateral
  under Indemnity Agreements

  	
   

  	
  4

  
	
  Section 2.09.

  	
  Return of Collateral

  	
   

  	
  4

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
  TERM
  AND TERMINATION

  	
   

  	
  4

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 3.01.

  	
  Term and Termination

  	
   

  	
  4

  
	
  Section 3.02.

  	
  Effect of Termination

  	
   

  	
  4

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
  GENERAL
  PROVISIONS

  	
   

  	
  5

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 4.01.

  	
  Notices

  	
   

  	
  5

  
	
  Section 4.02.

  	
  Severability

  	
   

  	
  5

  
	
  Section 4.03.

  	
  Entire Agreement

  	
   

  	
  6

  
	
  Section 4.04.

  	
  No Third-Party Beneficiaries

  	
   

  	
  6

  
	
  Section 4.05.

  	
  Governing Law

  	
   

  	
  6

  
	
  Section 4.06.

  	
  Amendment

  	
   

  	
  6

  
	
  Section 4.07.

  	
  Rules of Construction

  	
   

  	
  6

  
	
  Section 4.08.

  	
  Counterparts

  	
   

  	
  6

  
	
  Section 4.09.

  	
  Assignability; Divestitures

  	
   

  	
  7

  
	
  Section 4.10.

  	
  Waiver of Jury Trial

  	
   

  	
  7

  
	
  Section 4.11.

  	
  Non-Recourse

  	
   

  	
  7

  

 

	
  EXHIBIT A

  	
  Spinco Bonds

  	
   

  	
   

  
	
  EXHIBIT B

  	
  Indemnity Agreements

  	
   

  	
   

  

 

i

 

SURETY BOND INDEMNITY AGREEMENT

 

This
Surety Bond Indemnity Agreement (this “Agreement”), dated as of November 9,
2010, is by and between General Growth Properties, Inc., a Delaware
corporation (“GGP”), and The Howard Hughes Corporation, a Delaware
corporation (for itself, and on behalf of each of its subsidiaries, “Spinco”).

 

RECITALS

 

WHEREAS,
GGP and Spinco entered into the Separation Agreement, dated as of the date
hereof (as amended, modified or supplemented from time to time in accordance
with its terms, the “Separation Agreement”);

 

WHEREAS,
certain members of the Spinco Group, as principal obligors, and the surety or
bonding companies party thereto (the “Sureties”) have issued those
certain surety bonds set forth on Exhibit A hereto (the “Spinco
Bonds”), which are outstanding on the date hereof;

 

WHEREAS,
GGP and certain of its Subsidiaries are parties to those certain indemnity
agreements set forth on Exhibit B hereto (the “Indemnity
Agreements”), pursuant to which GGP and its Subsidiaries party thereto are
obligated to make premium payments in respect of the Spinco Bonds and indemnify
the Sureties from and against all losses and liabilities they may incur or
suffer in respect of the Spinco Bonds; and

 

WHEREAS,
the Separation Agreement requires execution and delivery of this Agreement by
GGP and Spinco on or prior to the Plan Effective Date.

 

NOW,
THEREFORE, in consideration of the foregoing and the mutual agreements
contained in this Agreement, the Parties hereby agree as follows:

 

ARTICLE I

 

DEFINITIONS

 

Section 1.01.  Certain Defined Terms.  (a) Unless otherwise defined in this
Agreement, all capitalized terms used in this Agreement shall have the same
meaning as in the Separation Agreement.

 

(b)           The following capitalized
terms used in this Agreement shall have the meanings set forth below:

 

“Agreement”
shall have the meaning set forth in the Preamble.

 

“GGP”
shall have the meaning set forth in the Preamble.

 

“Indemnity
Agreements” shall have the meaning set forth in the Recitals.

 

“Losses”
means all claims, liabilities, damages, awards, assessments, settlements,
penalties, fines, judgments, losses, costs (including reasonable legal fees and
reasonable consultants’ and experts’ fees and respective expenses), charges and
expenses.

 

 

“Party”
means GGP and Spinco individually, and “Parties” means GGP and Spinco
collectively, and, in each case, their respective successors and permitted
assigns.

 

“Reduced
Availability” means an amount equal to the reduction in borrowing
availability under GGP’s then current senior credit facility to the extent such
reduction in availability relates to any or all of the Spinco Bonds.

 

“Separation
Agreement” shall have the meaning set forth in the Preamble.

 

“Spinco”
shall have the meaning set forth in the Preamble.

 

“Spinco
Bond Financing Fee” means, as of the applicable date, the sum of
(A) (i) the average daily balance of the Reduced Availability during
the preceding calendar month with respect to each Spinco Bond that resulted in
Reduced Availability during such time, in the aggregate, multiplied by (ii) an
annual percentage rate of 2.0% plus (B) (i) the average daily
balance of the Spinco Bond Exposure during the preceding calendar month with
respect to each Spinco Bond that did not result in Reduced Availability during
such time, in the aggregate, multiplied by (ii) an annual
percentage rate of 1.0%.

 

“Spinco
Bonds” shall have the meaning set forth in the Recitals.

 

“Spinco
Bond Exposure” means an amount equal to the exposure of the GGP Group
related to a particular Spinco Bond, which amount is initially set forth in the
column titled “Bond Remaining Exposure” in the spreadsheet attached hereto as Exhibit A,
and which amount Spinco may, in good faith consultation with GGP, update from
time to time to reflect reductions in such exposure; provided, however,
that Spinco shall provide GGP with evidence supporting the amount of any such
reduction that is reasonably acceptable, in form and substance, to GGP; provided,
further, that the amount of any Spinco Bond Exposure shall be reduced by
the amount of any collateral posted hereafter by Spinco or any other member of
the Spinco Group pursuant to Section 2.08 or otherwise.

 

“Sureties”
shall have the meaning set forth in the Recitals.

 

ARTICLE II

 

OBLIGATIONS WITH RESPECT
TO SPINCO BONDS

 

Section 2.01.  Bond Payments; Indemnification.  Spinco shall, and shall cause its applicable
Subsidiaries that are the principal obligors under the Spinco Bonds to:

 

(a)           pay directly (if requested
by GGP), or promptly reimburse GGP for the payment hereafter of, all premiums,
including any renewal premiums, with respect to the Spinco Bonds as they become
due; provided, that, with respect to any Spinco Bond that is terminated,
the premium payable by Spinco shall be pro rated for the month of termination,
and no premium payments shall thereafter be due in respect of such Spinco Bond;

 

(b)           indemnify GGP and each other
member of the GGP Group from and against, and pay to GGP or the applicable
member of the GGP Group the amount of, any and all Losses arising out of or
related to the Spinco Bonds, whether pursuant to the Indemnity Agreements or 

 

2

 

otherwise (except to the extent attributable to the
GGP Group’s gross negligence or willful misconduct with respect to
administering the applicable Surety relationship); and

 

(c)           pay to GGP or its designee
the Spinco Bond Financing Fee, monthly in arrears on or before the tenth day of
each month.

 

Section 2.02.  Taxes. 
Without limiting any provisions of this Agreement, Spinco shall pay any
sales, use and other similar taxes imposed on, or payable with respect to, any
amounts, including the Spinco Bond Financing Fee, payable by it pursuant to
this Agreement; provided, however, that Spinco shall not pay, or
be responsible for, any applicable income, franchise or gross receipts taxes
imposed on, or payable with respect to, any amounts, including the Spinco Bond
Financing Fee, payable by it pursuant to this Agreement.

 

Section 2.03.  Spinco Covenants.  Spinco shall, and shall cause its
Subsidiaries that are the principal obligors under the Spinco Bonds to:

 

(a)           use commercially reasonable
efforts to replace, as promptly as practicable following the date of this
Agreement, each of the Spinco Bonds with a new surety bond, letter of credit or
similar instrument (or otherwise discharge or terminate such Spinco Bond in a
manner) that does not involve any recourse to any member of the GGP Group; provided,
however, that, no later than twenty-four (24) months following the Plan
Effective Date, Spinco shall replace, or cause the replacement of, each of the
Spinco Bonds with a new surety bond, letter of credit or similar instrument (or
otherwise discharge or terminate such Spinco Bond in a manner) that does not
involve any recourse to any member of the GGP Group;

 

(b)           use commercially reasonable
efforts to cause the face amount of each outstanding Spinco Bond to be reduced
from time to time during the term of this Agreement to reflect the
then-remaining exposure under such Spinco Bond; and

 

(c)           perform all work in
accordance with the obligations underlying the Spinco Bonds.

 

Section 2.04.  No Right to Set-Off.  Spinco shall pay in full all amounts required
pursuant to Section 2.01 hereof and shall not set off, counterclaim
or otherwise withhold any amount owed to any member of the GGP Group under this
Agreement on account of any obligation owed by members of the GGP Group to
members of the Spinco Group that have not been finally adjudicated, settled or
otherwise agreed upon by the Parties in writing.

 

Section 2.05.  Notices.  Each party agrees to promptly provide to the
other party a copy of all written notices or other written correspondence
received by such party or any member of such party’s Group with respect to any
Spinco Bond or any Indemnity Agreement related to any Spinco Bond.

 

Section 2.06.  Indemnification Procedures.  The provisions of Article V of the
Separation Agreement shall govern claims for indemnification under this
Agreement.

 

Section 2.07.  Dispute Resolution.  The provisions of Article VIII of the
Separation Agreement shall govern resolution of any dispute, controversy or
claim arising out of this Agreement.

 

3

 

Section 2.08.  Request for Discharge or Posting of
Collateral under Indemnity Agreements. 
In the event that a Surety under any Indemnity Agreement shall take any
steps to require, in accordance with the terms of such Indemnity Agreement,
that GGP (or a GGP affiliate that is bound by such Indemnity Agreement) post
any collateral, in whatever form such collateral is required, GGP shall notify
Spinco of such requirement, and Spinco shall promptly provide, or cause to be
provided, the required collateral to such Surety in accordance with the terms
of such Indemnity Agreement, or otherwise make provision acceptable to the
Surety in accordance with the terms of such Indemnity Agreement, and Spinco
shall promptly reimburse GGP for any amounts incurred or paid by GGP and its
affiliates in connection with Spinco’s non-compliance with such requirement to
post collateral.  Similarly, if any
Surety shall require, in accordance with the terms of the applicable Indemnity
Agreement, that GGP (or a GGP affiliate that is bound by such Indemnity
Agreement) procure the discharge of the Surety from any Spinco Bond, GGP shall,
or shall cause a GGP affiliate to, procure the discharge of such Surety from
such Spinco Bond in the manner required by the applicable Indemnity Agreement,
and Spinco shall promptly reimburse GGP for any amounts incurred or paid by GGP
and its affiliates in connection with the procurement of such discharge.  For the purposes of clarity, this Section 2.08
is not intended to and shall not be construed to expand the express obligations
of GGP (or any affiliate thereof) under any Spinco Bond, and in no event shall
this Section 2.08 be interpreted to require GGP or an affiliate
thereof, or Spinco or an affiliate thereof, to provide any collateral to, or
secure any discharge of, a Surety except in accordance with, and pursuant to
the terms of, the applicable Spinco Bond, the related Indemnity Agreement or
this Agreement, as applicable.

 

Section 2.09.          Return of Collateral.  Any collateral posted prior to the date
hereof by any member of the GGP Group or by any member of the Spinco Group, and
any collateral posted on or after the date hereof by any member of the GGP
Group, in each case in connection with the Spinco Bonds, shall, upon release,
be returned to GGP (or its designees) and shall belong to GGP (or such
designee) as its sole and separate property. 
Any collateral posted on or after the date hereof by any member of the
Spinco Group in connection with the Spinco Bonds shall, upon release, be
returned to Spinco (or its designees) and shall belong to Spinco (or such
designee) as its sole and separate property.

 

ARTICLE III

 

TERM AND TERMINATION

 

Section 3.01.  Term and Termination.  This Agreement shall commence immediately
upon the Plan Effective Date and shall terminate as to each Spinco Bond listed
on Exhibit A upon the earlier to occur of: (i) the earliest
date on which such Spinco Bond has been discharged, replaced or otherwise
terminated, as demonstrated to GGP’s reasonable satisfaction by competent legal
evidence; and (ii) the mutual written agreement of the Parties to
terminate this Agreement in its entirety.

 

Section 3.02.  Effect of Termination.  Upon termination of this Agreement, Spinco
shall have no obligation to pay any fees or charges set forth in Section 2.01;
provided, that Spinco shall remain obligated to GGP for the Spinco Bond
Financing Fees and any other charges set forth in Section 2.01 owed
and payable on or prior to the effective date of termination.  Upon a termination of this Agreement, Section 2.01(b) (including
liability in respect of any indemnifiable Losses under this Agreement arising
or occurring on or prior to the date of termination), Article IV
and liability for all due and unpaid Spinco Bond Financing Fees and any other
charges set forth in Section 2.01 shall continue to survive
indefinitely.

 

4

 

ARTICLE IV

 

GENERAL PROVISIONS

 

Section 4.01.  Notices.  All notices, requests, claims, demands and
other communications under this Agreement shall be in writing and shall be
given or made (and shall be deemed to have been duly given or made upon
receipt) by delivery in person, by overnight courier service, by facsimile or
electronic transmission with receipt confirmed (followed by delivery of an
original via overnight courier service) or by registered or certified mail
(postage prepaid, return receipt requested) to the respective Parties at the
following addresses (or at such other address for a Party as shall be specified
in a notice given in accordance with this Section 4.01):

 

(i)            if to GGP:

 

General
Growth Properties, Inc. 

110 N. Wacker Drive

Chicago, IL
60606

Attention:        General Counsel

Facsimile:        (312) 960-5485

 

(ii)           if to Spinco:

 

The
Howard Hughes Corporation

13355 Noel Road

Suite 950

Dallas,
TX 75240

Attention:        Grant Herlitz

Facsimile:        (214) 741-3021

 

(iii)          in each case, with a copy
to:

 

Weil,
Gotshal & Manges LLP

767 Fifth Avenue

New
York, NY 10153 

Attention:        Gary Holtzer and Marcia
Goldstein

Facsimile:        (212) 310-8007

 

Section 4.02.  Severability.  If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced under any Law or
as a matter of public policy, all other conditions and provisions of this
Agreement shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated by this Agreement
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
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the Parties as closely as possible in a mutually acceptable
manner in order that the transactions contemplated by this Agreement be
consummated as originally contemplated to the greatest extent possible.

 

5

 

Section 4.03.  Entire Agreement.  Except as otherwise expressly provided in
this Agreement, this Agreement, the Separation Agreement and the other
Transaction Documents constitute the entire agreement of the Parties with
respect to the subject matter of this Agreement and supersede all prior agreements
and undertakings, both written and oral, between or on behalf of the Parties
with respect to the subject matter of this Agreement.

 

Section 4.04.  No Third-Party Beneficiaries.  This Agreement is for the sole benefit of GGP
and the members of the GGP Group and Spinco and the members of the Spinco Group
and their respective successors and permitted assigns and nothing in this
Agreement, express or implied, is intended to or shall confer upon any other
Person any legal or equitable right, benefit or remedy of any nature
whatsoever.

 

Section 4.05.  Governing Law.  This Agreement (and any claims or disputes
arising out of or related to this Agreement or to the transactions contemplated
by this Agreement or to the inducement of any Party to enter into this
Agreement or the transactions contemplated by this Agreement, whether for
breach of contract, tortious conduct or otherwise and whether predicated on
common law, statute or otherwise) shall in all respects be governed by, and
construed in accordance with, the Laws of the State of New York, including all
matters of construction, validity and performance, in each case without
reference to any conflict of Law rules that might lead to the application
of the Laws of any other jurisdiction.

 

Section 4.06.  Amendment.  No provision of this Agreement may be
amended, supplemented or modified except by a written instrument making
specific reference to this Agreement, signed by all the Parties.

 

Section 4.07.  Rules of Construction.  Interpretation of this Agreement shall be
governed by the following rules of construction:  (a) words in the singular shall be held
to include the plural and vice versa, and words of one gender shall be held to
include the other gender as the context requires; (b) references to the
terms Article, Section and paragraph are references to the Articles,
Sections and paragraphs of this Agreement unless otherwise specified; (c) references
to “$” shall mean U.S. dollars; (d) the word “including” and words of
similar import when used in this Agreement shall mean “including without
limitation,” unless otherwise specified; (e) the word “or” shall not be
exclusive; (f) references to “written” or “in writing” include in
electronic form; (g) provisions shall apply, when appropriate, to
successive events and transactions; (h) the headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement; (i) GGP and Spinco have each
participated in the negotiation and drafting of this Agreement and if an
ambiguity or question of interpretation should arise, this Agreement shall be
construed as if drafted jointly by the Parties and no presumption or burden of
proof shall arise favoring or burdening either Party by virtue of the authorship
of any of the provisions in this Agreement or any interim drafts of this
Agreement; (j) a reference to any Person includes such Person’s successors
and permitted assigns; (k) any reference to “days” means calendar days
unless business days are expressly specified; and (l) when calculating the
period of time before which, within which or following which any act is to be
done or step taken pursuant to this Agreement, the date that is the reference
date in calculating such period shall be excluded, if the last day of such
period is not a business day, the period shall end on the next succeeding
business day.

 

Section 4.08.  Counterparts.  This Agreement may be executed in one or more
counterparts, and by each Party in separate counterparts, each of which when
executed shall be deemed to be an original but all of which taken together
shall constitute one and the same agreement. 

 

6

 

Delivery of an executed counterpart of a signature page to
this Agreement by facsimile or portable document format (PDF) shall be as
effective as delivery of a manually executed counterpart of this Agreement.

 

Section 4.09.  Assignability;
Divestitures.  This Agreement
shall not be assigned by operation of Law or otherwise without the prior
written consent of GGP and Spinco, except that:

 

(a)           each Party may assign all of
its rights and obligations under this Agreement to any of its Subsidiaries; provided, that no such assignment shall release GGP or Spinco, as the case
may be, from any liability or obligation under this Agreement; and

 

(b)           in connection with the
divestiture of any Subsidiary or business of Spinco to an acquiror, Spinco (or
its applicable selling Subsidiary) shall, as a condition precedent to closing
such transaction, cause such acquiror to replace all Spinco Bonds issued on
behalf of such Subsidiary or business with a new surety bond, letter of credit
or similar instrument (or otherwise discharge or terminate such Spinco Bond in
a manner) that does not involve any recourse to any member of the GGP Group,
and Spinco shall provide evidence in form and substance reasonably satisfactory
to GGP of such replacement, discharge or termination; provided, that any and all costs and expenses incurred in connection
therewith shall be borne solely by Spinco.

 

Section 4.10.  Waiver of Jury Trial.  EACH PARTY TO THIS AGREEMENT WAIVES TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT
OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT. 
EACH PARTY (I) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY
OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER
PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER; AND (II) ACKNOWLEDGES THAT IT AND THE OTHER PARTY TO THIS
AGREEMENT HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER
TRANSACTION AGREEMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION 4.10.

 

Section 4.11.  Non-Recourse.  Other than the GGP Group and the Spinco
Group, no past, present or future director, officer, employee, incorporator,
member, partner, stockholder, Affiliate, agent, attorney or representative of
either GGP or Spinco or their respective Subsidiaries shall have any liability
for any obligations or liabilities of GGP or Spinco, respectively, under this
Agreement or for any claims based on, in respect of, or by reason of, the
transactions contemplated by this Agreement.

 

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

 

7

 

IN
WITNESS WHEREOF, the Parties have caused this Agreement to be executed on the
date first written above by their respective duly authorized officers.

 

 

	
   

  	
  GENERAL
  GROWTH PROPERTIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Thomas H. Nolan, Jr.

  
	
   

  	
   

  	
  Name:

  	
  Thomas
  H. Nolan, Jr.

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  THE
  HOWARD HUGHES CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  David Arthur

  
	
   

  	
   

  	
  Name:

  	
  David
  Arthur

  
	
   

  	
   

  	
  Title:

  	
  Interim
  Chief Executive Officer

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00180-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00180-of-00352.parquet"}]]