-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, RQpqf4/ASMMOqiUZA59SvHEVH3jrWP+ZumIEYCTxV69+jya6ir52aJyOtcftioO8 mEanzjJl2APKqiCD8pFMVw== 0000950131-01-500164.txt : 20010320 0000950131-01-500164.hdr.sgml : 20010320 ACCESSION NUMBER: 0000950131-01-500164 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 22 CONFORMED PERIOD OF REPORT: 20001231 FILED AS OF DATE: 20010319 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GENERAL GROWTH PROPERTIES INC CENTRAL INDEX KEY: 0000895648 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 421283895 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K SEC ACT: SEC FILE NUMBER: 001-11656 FILM NUMBER: 1571514 BUSINESS ADDRESS: STREET 1: 110 N WACKER DRIVE STREET 2: STE 3100 CITY: CHICAGO STATE: IL ZIP: 60606 BUSINESS PHONE: 3129605000 MAIL ADDRESS: STREET 1: 110 N WACKER DRIVE STREET 2: STE 3100 CITY: CHICAGO STATE: IL ZIP: 60606 10-K 1 d10k.txt FORM 10-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (MARK ONE) [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2000 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO COMMISSION FILE NUMBER 1-11656 GENERAL GROWTH PROPERTIES, INC. (Exact name of registrant as specified in its charter) Delaware 42-1283895 -------- ---------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 110 N. Wacker Dr., Chicago, IL 60606 ------------------------------ ----- (Address of principal executive offices) (Zip Code) (312) 960-5000 -------------- (Registrant's telephone number, including area code)
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON WHICH REGISTERED ------------------- ----------------------------------------- Common Stock, $.10 par value New York Stock Exchange Depositary Shares, each representing New York Stock Exchange 1/40 of a share of 7.25% Preferred Income Equity Redeemable Stock, Series A Preferred Stock Purchase Rights New York Stock Exchange
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: None Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES X NO [ ] Indicate by a check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (ss. 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. As of March 14, 2001, the aggregate market value of the 50,134,462 shares of Common Stock held by non-affiliates of the registrant was $1,724,628,493, based upon the closing price on the New York Stock Exchange composite tape on such date. (For this computation, the registrant has excluded the market value of all shares of its Common Stock reported as beneficially owned by executive officers and directors of the registrant; such exclusion shall not be deemed to constitute an admission that any such person is an "affiliate" of the registrant). As of March 14, 2001, there were 52,374,034 shares of Common Stock outstanding. DOCUMENTS INCORPORATED BY REFERENCE Portions of the proxy statement for the annual stockholders meeting to be held on May 8, 2001 are incorporated by reference into Part III. PART I All references to numbered Notes are to specific footnotes ITEM 1. to the Consolidated Financial Statements of the Company (as BUSINESS defined below) included in this Annual Report on Form 10-K and the descriptions included in such Notes are incorporated into the applicable Item response by reference. The following discussion should be read in conjunction with such Consolidated Financial Statements and related Notes. General General Growth Properties Inc. ("General Growth") was formed in 1986 by Martin Bucksbaum and Matthew Bucksbaum (the "Original Stockholders"). On April 15, 1993, an initial public offering of the common stock (the "Common Stock") of General Growth and certain related transactions were completed. Concurrently, General Growth (as general partner) and the Original Stockholders (as limited partners) formed GGP Limited Partnership (the "Operating Partnership"). General Growth has elected to be taxed as a real estate investment trust (a "REIT") for federal income tax purposes. As of December 31, 2000, General Growth either directly or through the Operating Partnership and subsidiaries (collectively, the "Company") owned 100% of fifty-three regional mall shopping centers (the "Wholly-Owned Centers"); 50% of the stock of GGP/Homart, Inc. ("GGP/Homart"), 50% of the membership interest of GGP/Homart II, L.L.C. ("GGP/Homart II"), 51% of the stock of GGP Ivanhoe, Inc. ("GGP Ivanhoe"), and 51% of the stock of GGP Ivanhoe III, Inc. ("GGP Ivanhoe III"), and 50% of each of two regional mall shopping centers, Quail Springs Mall and Town East Mall (collectively, the "Unconsolidated Real Estate Affiliates"). In addition, as of December 31, 2001 the Company owned a non-voting preferred stock interest in General Growth Management, Inc. ("GGMI"). The Unconsolidated Real Estate Affiliates and GGMI comprise the "Unconsolidated Affiliates". The 50% interest in the twenty-three centers owned by GGP/Homart, the 50% interest in the seven centers owned by GGP/Homart II, the 51% ownership interest in the two centers owned by GGP Ivanhoe, the 51% ownership interest in the eight centers owned by GGP Ivanhoe III, and the 50% ownership interest in both Quail Springs Mall and Town East Mall comprise the "Unconsolidated Centers". Together, the Wholly-Owned Centers and the Unconsolidated Centers comprise the "Company Portfolio" or the "Portfolio Centers". On December 31, 2000, General Growth owned an approximate 73% general partnership interest in the Operating Partnership, and various minority holders, including the Original Stockholders and subsequent contributors of properties to the Operating Partnership, owned the remaining 27% limited partnership interest. See Item 7 and the Consolidated Financial Statements and Notes included in Item 8 of this Annual Report on Form 10-K for certain financial and other information required by this Item 1. On December 22, 1995 the Company, jointly with four other investors, acquired 100% of the stock of GGP/Homart which owned substantially all of the regional mall assets and liabilities of Homart Development Co., an indirect wholly- owned subsidiary of Sears, Roebuck & Co. The Company acquired approximately 38.2% of GGP/Homart for approximately $178 million including certain transaction costs. All of the stockholders of GGP/Homart committed to contribute up to $80.0 million of additional capital and, as of December 31, 1997 this commitment had been fulfilled. During 1999, three of the original four other investors, in independent transactions and pursuant to their respective exchange rights, exchanged their interests in GGP/Homart for Common Stock of General Growth. As a result of these transactions, the Company currently owns a 50% interest in GGP/Homart, which has elected to be taxed as a REIT. 2 On December 22, 1995, GGP Management, Inc. ("GGP Management") was formed to manage, lease, develop and operate enclosed malls. The Operating Partnership owned 100% of the non-voting preferred stock ownership interest in GGP Management representing 95% of the equity interest. Key employees of the Company held the remaining 5% equity interest in the form of common stock entitled to all of the voting rights in GGP Management. In August of 1996, GGP Management acquired GGMI through arm's length negotiations for approximately $51.5 million (including borrowings from the Operating Partnership of approximately $39.9 million) which was accounted for as a purchase. GGP Management was then merged into GGMI with GGMI as the surviving entity. At December 31, 2000, the Operating Partnership owned all of the non-voting preferred stock ownership interest in GGMI representing 95% of the equity interest. Certain key current or former employees of the Company held the remaining 5% equity interest through ownership of 100% of the common stock, which was entitled to all voting rights in GGMI. The interest only loans from the Operating Partnership to GGMI bore interest at rates ranging from 8% to 14% per annum and were scheduled to mature in 2016. On January 1, 2001 the REIT provisions of the Tax Relief Extension Act of 1999 became effective. Among other things, the law permits a REIT to own up to 100% of the stock of a taxable REIT subsidiary (a "TRS"). A TRS, which must pay corporate income tax, can provide services to REIT tenants and others without disqualifying the rents that a REIT receives from its tenants. Accordingly, on January 1, 2001 the Company acquired for nominal consideration 100% of the common stock of GGMI and will elect to have GGMI treated as a TRS. In connection with the acquisition, the GGMI preferred stock owned by the Company was cancelled and approximately $40 million of the outstanding loans owed by GGMI to the Company were contributed to the capital of GGMI. The Company and GGMI concurrently terminated the management contracts for the Wholly-Owned Centers as the management activities will be performed directly by the Company. GGMI will continue to manage, lease, and perform various other services for the Unconsolidated Centers and other properties owned by unaffiliated third parties. On September 17, 1997, GGP Ivanhoe indirectly acquired The Oaks Mall in Gainesville, Florida and Westroads Mall in Omaha, Nebraska. The purchase price for the two properties was approximately $206 million of which $125 million was financed through property level indebtedness. The Company contributed approximately $43 million for its 51% ownership interest in GGP Ivanhoe. Ivanhoe, Inc. of Montreal, Canada ("Ivanhoe") owns the remaining 49% ownership interest in GGP Ivanhoe. GGP Ivanhoe has elected to be taxed as a REIT. Effective as of June 30, 1998, GGP Ivanhoe III acquired the U.S. Prime Property, Inc. ("USPPI") real estate portfolio through a merger of a wholly-owned subsidiary of GGP Ivanhoe III into USPPI. The common stock of GGP Ivanhoe III, which has elected to be taxed as a REIT, is owned 51% by the Company and 49% by Ivanhoe. The aggregate consideration paid pursuant to the merger agreement was approximately $625 million. The acquisition was financed with a $392 million interim loan, which was replaced in 1999, and capital contributions from the Company and the joint venture partner in proportion to their respective stock ownership. The properties acquired include Landmark Mall in Alexandria, Virginia; the Mayfair Mall and adjacent office buildings in Wauwatosa (Milwaukee), Wisconsin; the Meadows Mall in Las Vegas, Nevada; the Northgate Mall in Chattanooga, Tennessee; Oglethorpe Mall in Savannah, Georgia; and the Park City Center in Lancaster, 3 Pennsylvania. During 1999, GGP Ivanhoe III acquired Oak View Mall in Omaha, Nebraska and Eastridge Mall in San Jose, California. The aggregate purchase price for the two properties was approximately $160 million, financed by capital contributions of the partners, a new $83 million long-term mortgage loan and certain short-term financing. In November 1999, the Company formed GGP/Homart II, a new joint venture with the New York State Common Retirement Fund, the Company's venture partner in GGP/Homart. GGP/Homart II owns three regional malls contributed by the New York State Common Retirement Fund (Alderwood Mall in Lynnwood (Seattle), Washington; Carolina Place in Charlotte, North Carolina; and Montclair Plaza in Montclair (Los Angeles), California), and four regional malls (Altamonte Mall in Orlando, Florida; Natick Mall in Natick, Massachusetts; Northbrook Court in Northbrook, Illinois; Stonebriar Centre in Frisco (Dallas), Texas) contributed by the Company as more fully described in Note 3. During May 2000, the Operating Partnership formed GGPLP L.L.C., a Delaware limited liability company (the "LLC") by contributing its interest in a portfolio of 44 Wholly-Owned Centers to the LLC in exchange for all of the common units of membership interest in the LLC. On May 25, 2000, a total of 700,000 redeemable preferred units of membership interest in the LLC (the "RPUs") were issued to an institutional investor by the LLC, which yielded approximately $170.6 million in net proceeds to the Company. The net proceeds of the sale of the RPUs were used to repay a portion of the Company's unsecured debt. Business of the The Company is primarily engaged in the ownership, Company operation, management, leasing, acquisition, development, expansion and financing of regional mall shopping centers in the United States. Most of the shopping centers in the Company Portfolio are strategically located in major and middle markets where they have strong competitive positions. A detailed listing starting on page 14 of this report contains information on each regional mall shopping center in the Company Portfolio including location, year opened, square footage, anchors, and anchor vacancies. The Company Portfolio's geographic diversification should mitigate the effects of regional economic conditions and local factors. The Company makes all key strategic decisions for the Portfolio Centers. However, in connection with the Unconsolidated Centers, such strategic decisions are made jointly with the respective stockholders or joint venture partners. The Company is also the asset manager of the Portfolio Centers, executing the strategic decisions and overseeing the day-to-day activities performed directly by the Operating Partnership or, with respect to the Unconsolidated Centers, by GGMI. GGMI performs day-to-day property management functions including leasing, construction management, data processing, maintenance, accounting, marketing, promotion and security pursuant to the management agreements with the Unconsolidated Centers. As of December 31, 2000 GGMI was the property manager for forty of the Unconsolidated Centers. The remaining two centers, owned by GGP/Homart through joint ventures, are managed by certain joint venture partners of GGP/Homart. The majority of the income from the Portfolio Centers is derived from rents received through long term leases with retail tenants. The long-term leases require the tenants to pay base rent which is a fixed amount specified in the lease. The base rent is often subject to scheduled increases defined in the lease. Another component of income is overage rent. Overage rent is paid by a tenant generally if their sales exceed an agreed 4 upon minimum annual amount. Overage rent is calculated by multiplying the sales in excess of the minimum annual amount by a percentage defined in the lease. Long-term leases generally contain a provision for the lessor to recover certain expenses incurred in the day-to-day operations including common area maintenance and real estate taxes. The recovery is generally related to the tenant's pro-rata share of space in the property. The evolution of the shopping center business necessitates the implementation of new approaches to shopping center management and leasing. Management's strategies to increase shareholder value and cash flow include the integration of mass merchandise retailers with traditional department stores, specialty leasing, entertainment-oriented tenants, proactive property management and leasing, operating cost reductions including those resulting from economies of scale, strategic expansions and acquisitions, e-business initiatives and selective new shopping center developments. Management believes that these approaches should enable the Company to operate and grow successfully in today's value- oriented and technological environment. Following is a summary of recent acquisition, development and expansion and redevelopment activity. As used in this Annual Report on Form 10-K, the term "GLA" refers to gross leaseable retail space, including Anchors and mall tenant areas; the term "Mall GLA" refers to gross leaseable retail space, excluding Anchors; the term "Anchor" refers to a department store or other large retail store; the term "Mall Stores" refers to stores (other than Anchors) that are typically specialty retailers who lease space in shopping centers; and the term "Freestanding GLA" means gross leaseable area of freestanding retail stores in locations that are not attached to the primary complex of buildings that comprise a regional mall shopping center. Acquisitions The Company continues to seek to acquire properties that provide opportunities for enhanced profitability and appreciation in value and corresponding increases in shareholder value. In 2000, the Company acquired an 100% ownership interest in Crossroads Center, a regional mall in St. Cloud (Minneapolis), Minnesota for an aggregate investment by the Company of approximately $80 million. The Company's management feels that it has a competitive advantage with respect to the acquisition of regional mall shopping centers for the following reasons: . The funds necessary for a cash acquisition of a shopping center may be available to the Company from a combination of sources, including mortgage or unsecured financing or the issuance of public or private debt or equity. . The Company has the flexibility to pay for an acquisition with a combination of cash, Preferred or Common Stock or common units of limited partnership interest in the Operating Partnership (the "Units"). This creates the opportunity for a tax-advantaged transaction for the seller. . Management's expertise allows it to evaluate proposed acquisitions for their increased profit potential. Additional profit can originate from many sources including expansions, remodeling, re-merchandising, and more efficient management of the property. Development The Company intends to pursue development when warranted by the potential financial returns. GGP/Homart II completed and opened on schedule in August 2000 the Stonebriar Centre (described below), an enclosed shopping center in Frisco (Dallas), Texas. In addition, the Company is preparing to develop (with a joint venture 5 partner) an enclosed regional mall in Westlake (Dallas), Texas (described below) and is investigating certain other development sites, including Toledo, Ohio and West Des Moines, Iowa. However, there can be no assurance that development of these sites will proceed. Construction commenced on the Stonebriar Centre in Frisco, Texas in October 1998. Upon its completion in August 2000, this 1,600,000 square foot regional mall shopping center featured five department store anchors, a 24 screen AMC theater, approximately 350,000 square feet of Mall Stores and 150,000 square feet of big box and large format retailers. Plans still include a possible second phase expansion to include two additional department stores. During 1999, the Company formed a joint venture to develop an enclosed mall in Westlake (Dallas), Texas. As of December 31, 2000, the Company had invested approximately $14.5 million in the joint venture. The Company is currently obligated to fund pre-development costs (estimated to be approximately $1.5 million, most of which has been incurred) and actual development costs have not yet been finalized. The retail site, part of a planned community which is expected to contain a resort hotel, a golf course, luxury homes and corporate offices, is currently planned to contain up to 1.5 million square feet of tenant space including up to six anchor stores and a multi-screen theater. There can be no assurance that development of this site will proceed beyond the pre-development phase. Expansions and Renovations During 2000, 16 major projects were underway or completed. The expansion and renovation of a Portfolio Center often increases customer traffic, trade area penetration and typically improves the competitive position of the property. Four of the larger renovation and expansion projects under construction in 2000 are described below. The redevelopment of the Knollwood Mall, a 402,182 square foot center located in St. Louis Park (Minneapolis), Minnesota began in 1999. The project includes adding a 16- screen theater complex and completely remerchandising the center, which is expected to be completed in early 2001. Eden Prairie Mall, located in Eden Prairie, Minnesota, a suburb of Minneapolis, was previously a four-anchor center with approximately 325,000 square feet of Mall Stores. Phase I of the renovation commenced in early 1999 consisting of a new Von Maur anchor store and a new 500 car parking structure. Construction of Phase II of the project commenced in late 1999 and will consist of a mall renovation, a food court renovation, and the construction of a multi-screen theatre. Both phases are scheduled to be completed in 2001. Fallbrook Mall is a 1,024,737 square foot enclosed mall located in West Hills, (Los Angeles) California. The renovation of the mall commenced in 2000 and will consist of converting the mall to an outdoor, 1,100,000 square foot power center with an additional anchor store and additional big box retailers. Completion of the project is anticipated for fall 2002. Valley Hills Mall, a 619,921 square foot center located in Hickory, North Carolina is undergoing an extensive renovation which commenced in 2000. The mall will add a new Dillards store to the existing anchors, Belk, JC Penney and Sears. The project also includes a food court, approximately 30,000 square feet of new mall shop space and two new parking decks. Completion is planned for late 2001. 6 The Portfolio Centers All of the 95 Portfolio Centers are shopping centers with at least one major department store as an Anchor and a wide variety of smaller Mall Stores. Most of the Portfolio Centers have three or four Anchors and additional Freestanding Stores. Each Portfolio Center provides ample parking for shoppers. The Portfolio Centers: . Range in size between approximately 184,000 and 1,810,000 square feet of total GLA and between approximately 125,000 and 800,000 square feet of Mall and Freestanding GLA. The smallest Portfolio Center has approximately 20 stores, and the largest has over 265 stores; . Have approximately 396 Anchors, operating under approximately 68 trade names; and . Have approximately 9,500 Mall and Freestanding Stores. The average size of the 95 Portfolio Centers is approximately 910,000 square feet of GLA, including all Anchors, Mall Stores and Freestanding Stores. The average Mall and Freestanding GLA per Portfolio Center is approximately 360,000 square feet. As of December 31, 2000, the Wholly-Owned Centers contained approximately 43.2 million square feet of GLA consisting of Anchors (whether owned or leased), Mall Stores and Freestanding Stores. The Unconsolidated Centers contained approximately 43.0 million square feet of GLA. The Company's share of total revenues from the Portfolio Centers and GGMI increased to $1,112 million in 2000 from $907 million in 1999. No single Portfolio Center generated more than 9.6% of the Company's total 2000 pro rata revenues. In 2000, total Mall Store sales from the Portfolio Centers increased by approximately 7.4% in comparison to the total Mall Store sales in 1999. 7 The table below shows tenants, by trade name, with more than .75% of aggregate annualized effective rents as compared to consolidated effective rents on an annualized basis in the Wholly-Owned Centers at December 31, 2000. In addition, similar percentages existed in the Portfolio Centers as of December 31, 2000.
% of Total Tenant Name Annualized Rents ----------- ---------------- JCPenney 1.52% Sears 1.34% Express (/1/) 1.31% Victoria's Secret (/1/) 1.12% Gap 1.10% Lerner N.Y. 0.94% Footlocker 0.91% The Limited 0.89% Zales Jewelers 0.88% Old Navy 0.85% American Eagle Outfitters 0.83% Eddie Bauer 0.82% Payless 0.81% Kay Bee Toys 0.81% Champs Sports 0.78%
-------- (1) Under common ownership by The Limited, Inc. Mall and The Portfolio Centers have a total of approximately 9,500 Freestanding Mall and Freestanding Stores. The following table reflects Stores the tenant representation by category in the Portfolio Centers as of December 31, 2000.
% of Sq. Ft. in Portfolio Tenant Categories Centers (*) Types of Tenants/Products Sold ----------------- --------------- -------------------------------- Specialty 22% Photo studios, beauty and nail salons, pharmacy and sundries, variety stores, pet stores, newsstands, jewelry repair, shoe repair, tailor, video games, shops for home/bath/kitchen, rugs, fabric stores, beds/ waterbeds, luggage, perfume, tobacco, toys, arcades, cameras, sunglasses, books ------------------------------------------------------------- Women's Apparel 19% Women's apparel ------------------------------------------------------------- Apparel 18% Unisex apparel, children's apparel, lingerie, and formalwear ------------------------------------------------------------- Shoes 11% Shoes ------------------------------------------------------------- Food 8% Restaurant, food court ------------------------------------------------------------- Gifts 5% Cards, candles, engraving stores, other gift or novelty ------------------------------------------------------------- Music/Electronics 6% Music, electronics, computer and software, video rental ------------------------------------------------------------- Sporting Goods 3% Sports apparel, sports and exercise equipment ------------------------------------------------------------- Jewelry 4% Fine jewelry and costume jewelry ------------------------------------------------------------- Men's Apparel 2% Men's apparel ------------------------------------------------------------- Specialty Food 2% Candy, coffee, nuts, chocolate, health food/vitamins ------------------------------------------------------------- Total 100% -------------------------------- --
8 -------- (*) Excludes the two malls managed by joint venture partners of GGP/Homart (Arrowhead Towne Center and Superstition Springs). Specialty tenants include Mastercuts, One Hour Photo, California Nails, Kay-Bee Toys, Dollar Tree, Pottery Barn and many others. Typical tenants in the Women's Apparel category include The Limited, Casual Corner, Lane Bryant and Victoria's Secret. The Apparel category typically includes tenants such as The Gap, American Eagle, Old Navy and J.Crew. The Shoes category includes tenants such as Footlocker, Journeys and Payless Shoesource. The Food category includes restaurants such as Ruby Tuesday, Cheesecake Factory and Max and Erma's, fast food restaurants such as Arby's, and food court tenants such as Sbarro. Typical tenants in the Gifts Category include Disney, Things Remembered, Kirlin's Hallmark and Spencer Gifts. The Music/Electronics category includes tenants such as Camelot Music, Radio Shack, and Suncoast Pictures. Sporting Goods include tenants such as Champs, Big 5 Sports and Scheel's Sports. Jewelry tenants typically include Zales, Helzberg Diamonds and Kay Jewelers. The Men's Apparel category includes tenants such as The Men's Warehouse and Nicks for Men. Specialty Food tenants include General Nutrition Center, Mr. Bulky, and Barnie's Coffee and Tea Company. Competition The Portfolio Centers compete with numerous shopping alternatives in seeking to attract retailers to lease space as retailers themselves face increasing competition from discount shopping centers, outlet malls, discount shopping clubs, direct mail, internet sales and telemarketing. The nature and extent of competition varies from property to property within the Company Portfolio. Below is a description of the type of competition that three of the Portfolio Centers face from other retail locations within their trade area. These examples are representative of the competitive environment in which the Company operates. Valley Hills Mall is a 616,000 square foot, enclosed regional shopping center located in Hickory, North Carolina. The mall opened in 1978 and serves a six county trade area which includes over 307,000 people. Major manufacturing industries in the area include furniture, textiles and fiber optics. The mall currently has three Anchor tenants: Belk, JCPenney and Sears. The mall has 78 mall shops with national retailers such as FootAction, American Eagle and Abercrombie & Fitch. Valley Hills' primary regional mall competition is just outside of its trade area and consists of super- regional centers such as Eastridge Mall, Hanes Mall and Carolina Place Mall. The mall also faces competition from neighborhood strip and power shopping centers including Kohl's, Marshalls and Barnes and Noble which have opened within the last year and are located within a one-mile radius of the center. Northbrook Court is a two-story, 978,000 square foot regional mall located in Northbrook (Chicago), Illinois. The mall contains 128 mall shops, and three Anchor department stores. The mall is anchored by Lord & Taylor, Marshall Fields and Neiman-Marcus. The property includes a 14-screen General Cinema Theater and national retailers such as Abercrombie & Fitch, Ann Taylor, The Gap and J.Crew. Northbrook Court faces competition from two regional malls in its primary trade area. Old Orchard Shopping Center is a recently renovated open-air regional shopping mall located eight miles southeast of Northbrook Court. Old Orchard features five Anchor department stores and includes 1.8 million square feet of leaseable area. Hawthorn Center, a 1.06 million square foot regional mall located ten miles northwest of Northbrook Court, includes three Anchor department stores. The secondary competition for Northbrook Court consists of discount retailers, numerous strip 9 shopping centers located within a few miles of the center, and a super regional mall (Woodfield Mall), with 2.1 million square feet located fifteen miles southwest of Northbrook Court. Crossroads Center is a 782,000 million square foot, single- level, regional shopping center located in St. Cloud (Minneapolis), Minnesota, one of Minnesota's fastest growing metropolitan areas. Crossroads Center is anchored by Dayton's, Sears, JCPenney and Target and has 119 specialty mall shops. Crossroads Center opened in 1966 and renovations were made in 1999, including a new food court and carousel. The mall's trade area includes over 415,000 people and major employers include granite, printing and lens manufacturing companies as well as medical, retail and high technology firms. The Center's primary competition is from a free- standing Kohl's department store and a number of "big-box" retailers in the immediate area, including Circuit City, K- Mart, Wal-Mart, Sam's Club and Best Buy. Additional competitors are Kendi Mall and Ridgedale Center, both over 50 miles to the south of Crossroads Center. Environmental Under various federal, state and local laws and regulations, Matters an owner of real estate is liable for the costs of removal or remediation of certain hazardous or toxic substances on such property. These laws often impose such liability without regard to whether the owner knew of, or was responsible for, the presence of such hazardous or toxic substances. The costs of remediation or removal of such substances may be substantial, and the presence of such substances, or the failure to promptly remediate such substances, may adversely affect the owner's ability to sell such real estate or to borrow using such real estate as collateral. In connection with its ownership and operation of the Portfolio Centers, General Growth, the Operating Partnership or the relevant property venture through which the property is owned, may be potentially liable for such costs. All of the Portfolio Centers have been subject to Phase I environmental assessments, which are intended to discover information regarding, and to evaluate the environmental condition of, the surveyed and surrounding properties. The Phase I assessments included a historical review, a public records review, a preliminary investigation of the site and surrounding properties, screening for the presence of asbestos, polychlorinated biphenyls ("PCBs") and underground storage tanks and the preparation and issuance of a written report, but do not include soil sampling or subsurface investigations. Where the Phase I assessment so recommended, a Phase II assessment was conducted to further investigate any issues raised by the Phase I assessment. In each case where Phase I and/or Phase II assessments resulted in specific recommendations for remedial actions, management has either taken or scheduled the recommended action. Neither the Phase I nor the Phase II assessments have revealed any environmental liability that the Company believes would have a material effect on the Company's business, assets or results of operations, nor is the Company aware of any such liability. Nevertheless, it is possible that these assessments do not reveal all environmental liabilities or that there are material environmental liabilities of which the Company is unaware. Moreover, no assurances can be given that (i) future laws, ordinances or regulations will not impose any material environmental liability or (ii) the current environmental condition of the Portfolio Centers will not be adversely affected by tenants and occupants of the Portfolio Centers, by the condition of properties in the vicinity of the Portfolio Centers (such as the presence of underground storage tanks) or by third parties unrelated to the Company. 10 Employees As of March 14, 2001, the Company and GGMI had 3,506 full- time employees. Certain employees at three of the Portfolio Centers are subject to collective bargaining agreements. The Company's management believes that their employee relations are satisfactory and there has not been a labor-related work stoppage at any of its Centers. Insurance The Company has comprehensive liability, fire, flood, earthquake, extended coverage and rental loss insurance with respect to the Portfolio Centers. The Company's management believes that all of the Portfolio Centers are adequately covered by insurance. Qualification General Growth currently qualifies as a real estate as a Real investment trust pursuant to the requirements contained in Estate Sections 856-858 of the Internal Revenue Code of 1986, as Investment amended (the "Code"). If, as General Growth contemplates, Trust and such qualification continues, General Growth will not be Taxability of taxed on its real estate investment trust taxable income. Distributions During 2000, General Growth distributed (or was deemed to have distributed) 100% of its taxable income to its preferred and common stockholders. Cash distributions in the amount of $2.06 per share of Common Stock were paid for 2000, of which $1.90 (92.2%) was ordinary income and $0.16 (7.8%) was a return of capital based on the taxable income of General Growth. ITEM 2. The Company's investment in real estate as of December 31, PROPERTIES 2000 consisted of its interests in the Portfolio Centers, developments in progress and certain other real estate. In most cases, the land underlying the Portfolio Centers is also owned by the Company; however, at a few of the centers, all or part of the underlying land is owned by a third party that leases the land pursuant to a ground lease. Leasing The Portfolio Centers average Mall Store rent per square foot from leases that expired in 2000 was $29.29. As a result of market rents being higher than the rents under many of the expiring leases, the average Mall Store rent per square foot on new and renewal leases during 2000 was $35.24, or $5.95 per square foot more than the average for expiring leases. The following schedule shows scheduled lease expirations over the next five years. 11 PORTFOLIO CENTERS FIVE YEAR LEASE EXPIRATION SCHEDULE
All Expirations Expirations @ Share (/1/) -------------------------------- ------------------------------- Base Rent Footage Rent/PSF Base Rent Footage Rent/PSF ------------ ---------- -------- ------------ --------- -------- Wholly Owned 2001 $ 17,325,771 759,767 $22.80 $ 17,325,771 759,767 $22.80 2002 27,792,429 1,202,392 23.11 27,792,429 1,202,392 23.11 2003 29,945,519 1,386,243 21.60 29,945,519 1,386,243 21.60 2004 24,772,976 1,055,919 23.46 24,772,976 1,055,919 23.46 2005 38,815,920 1,640,130 23.67 38,815,920 1,640,130 23.67 ------------ ---------- ------ ------------ --------- ------ Portfolio Total $138,652,615 6,044,451 $22.94 $138,652,615 6,044,451 $22.94 Unconsolidated (/2/) 2001 $ 19,410,277 929,961 $20.87 $ 10,038,593 476,976 $21.05 2002 28,088,561 964,298 29.13 14,492,194 501,162 28.92 2003 27,369,549 964,575 28.37 14,159,561 500,306 28.30 2004 36,568,270 1,283,863 28.48 18,460,733 653,794 28.24 2005 30,086,497 1,050,881 28.63 15,189,306 534,992 28.39 ------------ ---------- ------ ------------ --------- ------ Portfolio Total $141,523,154 5,193,578 $27.25 $ 72,340,387 2,667,230 $27.12 Grand Total $280,175,769 11,238,029 $24.93 $210,993,002 8,711,681 $24.22 ============ ========== ====== ============ ========= ======
- -------- (1) Expirations at share reflect the Company's direct or indirect ownership interest in a joint venture. (2) Excludes the two malls managed by joint venture partners of GGP/Homart (Arrowhead Towne Center and Superstition Springs). 12 Company At December 31, 2000, the Company had direct or indirect Portfolio Debt ("pro rata") mortgage and other debt of approximately $4,540,036. The ratio of pro rata floating rate debt to total pro rata debt and preferred stock and preferred Operating Partnership Units was 40.0% at December 31, 2000. The following table reflects the maturity dates of the Company's pro rata debt and the related interest rates. COMPANY PORTFOLIO DEBT MATURITY AND CURRENT AVERAGE INTEREST RATE SUMMARY(a) AS OF DECEMBER 31, 2000 (Dollars in Thousands)
Unconsolidated Wholly-Owned Joint Venture Company Centers Properties (b) Portfolio Debt ------------------- ------------------- ------------------- Current Current Current Average Average Average Maturing Interest Maturing Interest Maturing Interest Year Amount Rate Amount Rate Amount Rate ---- ---------- -------- ---------- -------- ---------- -------- 2001.................... $ 392,000 7.66% $ 78,300 8.11% $ 470,300 7.74% 2002.................... 96,055 7.93% 178,909 7.12% 274,964 7.41% 2003.................... 265,000 8.20% 474,272 7.43% 739,272 7.71% 2004.................... 1,109,377 7.57% 200,989 7.66% 1,310,366 7.58% 2005.................... 25,614 7.99% 0 0.00% 25,614 7.99% Subsequent.............. $1,356,080 7.08% 363,440 7.38% 1,719,520 7.07% ---------- ----- ---------- ----- ---------- ----- Totals.................. $3,244,126 7.44% $1,295,910 7.45% $4,540,036 7.42% ========== ===== ========== ===== ========== ===== Floating................ $1,411,343 7.97% $ 608,978 7.71% $2,020,321 7.89% Fixed Rate.............. 1,832,783 7.01% 686,932 7.22% 2,519,715 7.07% ---------- ----- ---------- ----- ---------- ----- Totals.................. $3,244,126 7.44% $1,295,910 7.45% $4,540,036 7.42% ========== ===== ========== ===== ========== =====
- -------- (a) Excludes principal amortization. (b) Unconsolidated properties debt reflects the Company's share of debt (based on its respective equity ownership interests in the Unconsolidated Joint Ventures) relating to the properties owned by the Unconsolidated Joint Ventures. 13 Property Data The following tables set forth certain information regarding the Wholly-Owned Centers and the Unconsolidated Centers as of December 31, 2000. The first table depicts the Wholly- Owned Centers and the second table depicts the Unconsolidated Centers. Wholly-Owned Centers
Total GLA/Mall and Freestanding Year Opened/ GLA Name of Center/ Remodeled or (Square Feet) Anchor Location (/1/) Expanded (/2/) Anchors Vacancies - ------------------------- -------------- ---------------- -------------------------------------- --------- Ala Moana Center 1959/ 1,812,089/ JCPenney, Liberty House, None Honolulu, Hawaii 1966,1987, 800,624 Neiman Marcus, Sears 1989,1999 Apache Mall 1969/ 742,028/ Dayton's, JCPenney, None Rochester, Minnesota 1985,1992 232,762 Sears, Ward Baybrook Mall 1978/ 1,087,088/ Dillards, Mervyn's, Sears, Ward None Houston, Texas 1984,1985 343,565 Bayshore Mall 1987/ 613,464/ Gottschalks, JCPenney, Mervyn's, Sears None Eureka, California 1989 293,304 Bellis Fair Mall 1988/ 762,709/ The Bon Marche, JCPenney, Mervyn's, None Bellingham, Washington N/A 336,150 Sears, Target, Birchwood Mall 1990/ 786,425/ Hudson's, JCPenney, Sears, None Port Huron, Michigan 1991, 1997 287,291 Target, Younkers The Boulevard Mall 1968/ 1,184,772/ Dillard's, JCPenney, Macy's, Sears None Las Vegas, Nevada 1992 327,375 Capital Mall 1978/ 532,749/ Dillard's, JCPenney, Sears None Jefferson City, Missouri 1985,1992 234,294 Century Plaza 1975/ 743,609/ JCPenney, McRae's, Rich's, Sears None Birmingham, Alabama 1990,1994 235,213 Chapel Hills Mall 1982/ 1,172,585/ Dillard's, Foley's, JCPenney, KMart, None Colorado Springs, CO 1986,1997,1998 398,145 Mervyn's, Sears, Coastland Center 1977/ 927,014/ Burdines, Dillard's, JCPenney, Sears None Naples, Florida 1985,1996 336,624 Colony Square Mall 1981/ 546,318/ Elder-Beerman, JCPenney, Lazarus, None Zanesville, Ohio 1987 231,154 Sears Columbia Mall 1985/ 741,213/ Dillard's, JCPenney, Sears, Target None Columbia, Missouri 1987 314,269 Coral Ridge Mall 1998/ 997,363/ Dillard's, JCPenney, Scheel's, None Iowa City, Iowa N/A 291,750 Sears, Target, Younkers Crossroads Center 1966/ 783,934/ Dayton's, JCPenney, None St. Cloud, Minnesota 1995,1999 277,005 Sears, Target The Crossroads 1980/ 755,127/ Hudson's, JCPenney, Mervyn's, None Portage, Michigan 1982,1988,1998 252,167 Sears Cumberland Mall 1973/ 1,159,723/ JCPenney, Macy's, Rich's, Sears None Atlanta, Georgia 1989 325,608
14
Total GLA/Mall Year Opened/ and Freestanding Name of Center/ Remodeled GLA Anchor Location (/1/) or Expanded (Square Feet) (/2/) Anchors Vacancies - ------------------------ -------------- ------------------- --------------------------------------------- --------- Eagle Ridge Mall 1996/ 624,073/ Dillard's, JCPenney, Sears None Lake Wales, Florida N/A 279,291 Eden Prairie Mall 1976/ 873,766/ Kohl's, Mervyn's, Sears, Target None Eden Prairie, Minnesota 1989,1994 337,958 Fallbrook Mall 1966/ 1,041,141/ Burlington Coat Factory, JCPenney, Kmart, None West Hills, (Los Angeles), 1985 386,182 Mervyn's, Target California Fox River Mall 1984/ 1,128,712/ Dayton's, JCPenney, Sears, None Appleton, Wisconsin 1991,1998 434,152 Target, Younkers Gateway Mall 1990/ 646,747/ The Emporium, Sears, Target None Springfield/Eugene, 1999 287,796 Oregon Grand Traverse Mall 1992/ 577,399/ Hudson's, JCPenney, Target None Traverse City, Michigan N/A 299,928 Greenwood Mall 1979/ 783,837/ Dillard's, Dillard's Home Store, Famous Barr, None Bowling Green, Kentucky 1987 265,710 JCPenney, Sears Knollwood Mall 1955/ 399,699/ Cub Foods, Kohl's None St. Louis Park, 1981 168,439 (Minneapolis), Minnesota Lakeview Square Mall 1983/ 610,432/ Hudson's, JCPenney, Sears None Battle Creek, Michigan 1998 235,756 Lansing Mall 1969/ 846,524/ Hudson's, JCPenney, Mervyn's, None Lansing, Michigan N/A 319,619 Younkers Lockport Mall 1971/ 345,686/ Ames, The Bon Ton, None Lockport, New York 1984 114,015 Rosa's Homestore Mall of the Bluffs 1986/ 667,106/ Dillard's, JCPenney, Sears, Target None Council Bluffs, Iowa 1988,1998 319,060 (Omaha, Nebraska) Mall St. Vincent 1977/ 548,370/ Dillard's, Sears None Shreveport, Louisiana 1991 200,370 Market Place Shopping Center 1975/ 1,105,076/ Bergner's, Famous Barr, JCPenney, One Champaign, Illinois 1987,1994,1999 276,538 Kohl's, Sears McCreless Mall 1962/ 477,114/ Beall's, Montgomery Ward None San Antonio, Texas 1997 268,231 Northridge Fashion Center 1971/ 1,512,712/ JCPenney, Macy's, Robinson-May, None Northridge, California 1995,1997 625,105 Sears Oakwood Mall 1986/ 790,596/ Dayton's, JCPenney, None Eau Claire, Wisconsin 1991,1997 319,900 Scheel's All Sports, Sears, Target
15
Total GLA/Mall and Freestanding Year Opened/ GLA Name of Center/ Remodeled (Square Anchor Location (/1/) or Expanded Feet) (/2/) Anchors Vacancies - ------------------------ -------------- ---------------- ------------------------------------- --------- Park Place 1974/ 981,449/ Dillards, Macy's, Sears None Tucson, Arizona 1998 346,915 Piedmont Mall 1984/ 667,278/ Ames, Belk, Belk Men's, None Danville, Virginia 1995 189,160 JCPenney, Sears, Ames Pierre Bossier Mall 1982/ 610,345/ Dillard's, JCPenney, Sears, None Bossier City, Louisiana 1985,1992 263,453 Service Merchandise, Stage The Pines 1986/ 609,182/ Dillard's, JCPenney, None Pine Bluff, Arkansas 1990 265,396 Sears, Wal-Mart Regency Square Mall 1967/ 1,429,962/ Belk, Dillard's, JCPenney, None Jacksonville, Florida 1992,1998,1999 470,927 Sears, Wards Rio West Mall 1981/ 445,009/ Beall's, JCPenney, KMart None Gallup, New Mexico 1991,1998 170,130 River Falls Mall 1990/ 752,167/ Dillard's, Toys "R" Us, Wal-Mart, None Clarksville, Indiana N/A 277,836 (Louisville, Kentucky) River Hills Mall 1991/ 725,561/ Herberger's, JCPenney, None Mankato, Minnesota 1996 259,643 Sears ,Target Riverlands Shopping Center 1965/ 183,768/ Winn-Dixie None LaPlace, Louisiana 1984 183,768 (/3/) RiverTown Crossings 1999/ 1,248,624/ Galyan's, Hudson's, JCPenney, None Granville (Grand Rapids), N/A 499,999 Kohl's, Sears, Younkers, Michigan Sooner Fashion Square 1976/ 515,266/ Dillard's, JCPenney, None Norman, Oklahoma 1999 175,194 Sears, Stein Mart, Old Navy Clothing Company Southlake Mall 1976/ 1,015,835/ JCPenney, Macy's, Rich's, Sears None Morrow, Georgia 1995,1999 277,335 SouthShore Mall 1981/ 337,828/ JCPenney, KMart, Sears None Aberdeen, Washington N/A 148,501 Southwest Plaza 1983/ 1,236,551/ Dillards, Foley's, JCPenney, None Littleton, Colorado 1994,1995 430,732 Sears, Wards Spring Hill Mall 1980/ 1,100,033/ Carson Pirie Scott, JCPenney, Kohl's, None West Dundee, Illinois 1992,1996 394,129 Marshall Field's, Sears Valley Hills Mall 1978/ 616,427/ Belk, JCPenney, Sears None Hickory, North Carolina 1988,1990,1996 204,131 Valley Plaza Mall 1967/ 1,157,240/ Gottschalks, JCPenney, None Bakersfield, California 1988,1997,1998 338,317 Macy's, Robinson-May, Sears
16
Total GLA/Mall and Freestanding Name of Center/ Year Opened/ GLA Location Remodeled or (Square Feet) Anchor (/1/) Expanded (/2/) Anchors Vacancies - ------------------ ------------ ---------------- ------------------------------------------- --------- West Valley Mall 1995/ 742,768/ Gottschalks, JCPenney, Ross Dress for Less, None Tracy, California 1997 273,740 Sears, Target Westwood Mall 1972/ 453,971/ Elder-Beerman, JCPenney, None Jackson, Michigan 1978,1993 131,886 Wards
- -------- (1) In certain cases, where a Center's location is part of a larger metropolitan area, the metropolitan area is identified in parentheses. (2) Includes square footage added in redevelopment/expansion projects. (3) Winn-Dixie does not occupy its space but is currently paying rent under a lease which expires in October 2002. 17 UNCONSOLIDATED CENTERS
Ownership Total GLA/Mall Year Opened/ Interest % and Freestanding Name of Center/ Remodeled or of Operating GLA Anchor Location (/1/) Expanded Partnership Square Feet (/2/) Anchors Vacancies - ------------------------ ------------ ------------ ----------------- ------------------------------ --------- Alderwood Mall 1979/ 50 1,042,642/ The Bon Marche, JCPenney, One Lynnwood (Seattle), 1995,1996 310,834 Nordstrom, Sears, Washington Altamonte Mall 1974/ 50 1,090,250/ Burdines, Dillard's, None Orlando, Florida 1989,1990 389,202 JCPenney, Sears Arrowhead Towne Center 1993/ 16.7 1,130,901/ Dillard's, JCPenney, Mervyn's, None Glendale, Arizona N/A 392,954 Robinson-May, Wards Bay City Mall 1991/ 50 517,141/ JCPenney, Sears, None Bay City, Michigan 1993 211,290 Target, Younkers Brass Mill Center/Commons 1997/ 50 1,265,877/ Boscov's, Filene's, JCPenney, One Waterbury, Connecticut N/A 326,385 Sears Carolina Place 1991/ 50 1,090,910/ Belk, Dillards, Hecht's, None Charlotte, North Carolina 1994 317,408 JCPenney, Sears Chula Vista Center 1962/ 50 885,616/ JCPenney, Macy's, None Chula Vista, California 1993,1994 302,666 Mervyn's, Sears Columbiana Centre 1990/ 50 871,494/ Belk, Dillards, None Columbia, South Carolina 1992 258,067 Parisian, Sears Deerbrook Mall 1984/ 50 1,202,386/ Dillard's, Foley's, JCPenney, None Humble (Houston), Texas 1996,1997 462,793 Mervyn's, Sears Eastridge Mall 1970/ 51 1,358,684/ JCPenney, Macy's, Sears One San Jose, California 1982,1995 431,142 Lakeland Square 1988/ 50 900,600/ Belk, Burdines, Dillard's, None Lakeland, Florida 1994 290,562 JCPenney, Sears Landmark Mall 1965/ 51 962,931/ Hecht's, Lord & Taylor, Sears One Alexandria, VA 1989,1991 343,455 Mayfair Mall 1958/ 51 1,045,492/ The Boston Store, None Wauwatosa, Wisconsin 1986,1994 546,182 Marshall Fields Meadows Mall 1978/ 51 947,657/ Dillard's, JCPenney, Macy's, None Las Vegas, Nevada 1987,1997 310,804 Sears Montclair Plaza 1968/ 50 1,358,369/ JCPenney, Macy's, None Montclair (Los Angeles) 1985 518,359 Nordstrom, Robinson-May, California Sears, Wards Moreno Valley Mall 1992/ 50 1,035,060/ Harris, JCPenney, None Moreno Valley, California N/A 429,526 Robinson-May, Sears Natick Mall 1966/ 50 1,154,191/ Filene's, Lord & Taylor, None Natick, Massachusetts 1994 427,529 Macy's, Sears
18
Total GLA/Mall Ownership and Freestanding Year Opened/ Interest % GLA Name of Center/ Remodeled of Operating Square Anchor Location (/1/) or Expanded Partnership Feet (/2/) Anchors Vacancies - --------------------------- -------------- ------------ ---------------- -------------------------------- --------- Neshaminy Mall 1968/ 25 1,060,529/ Boscov's, Sears, One Bensalem, 1995,1998 423,738 Strawbridge and Clothiers Pennsylvania Newgate Mall 1981/ 50 688,921/ Dillard's, Mervyn's, None Ogden, Utah 1994,1998 275,757 Oshman's, Sears New Park Mall 1980/ 50 1,168,681/ JCPenney, Macy's, Mervyn's, None Newark, California 1993 389,628 Sears, Target Northbrook Court 1976/ 50 982,013/ Lord & Taylor, Marshall Fields, None Northbrook, Illinois 1995,1996 359,094 Neiman Marcus Northgate Mall 1972/ 51 816,894/ JCPenney, Proffitt's, Sears None Chattanooga, 1991 242,730 Tennessee North Point Mall 1993/ 50 1,367,587/ Dillard's, JCPenney, Lord & None Alpharetta (Atlanta), N/A 397,526 Taylor, Parisian, Rich's, Sears Georgia The Oaks Mall(/2/) 1978/ 51 907,647/ Belk, Burdines, Dillard's, None Gainesville, Florida N/A 337,646 JCPenney, Sears Oak View Mall 1991/ 51 867,615/ Dillard's, JCPenney, None Omaha, Nebraska 1995 249,690 Sears, Younkers Oglethorpe Mall 1969/ 51 957,220/ Belk, JCPenney, Rich's, Sears None Savannah, Georgia 1989,1990,1992 409,249 Park City Center 1970/ 51 1,397,459/ The Bon-Ton, Boscov's, JCPenney, None Lancaster, 1988,1997 488,962 Kohl's, Sears Pennsylvania The Parks at Arlington 1988/ 50 1,189,299/ Dillard's, Foley's, JCPenney, None Arlington, Texas N/A 358,354 Mervyn's, Sears Pavilions at Buckland Hills 1990/ 50 1,011,140/ Dick's Sporting Goods, Filene's, None Manchester, 1994 327,618 Filene's Home Store, JCPenney, Connecticut Lord & Taylor, Sears Pembroke Lakes Mall 1992/ 50 1,116,825/ Burdine's, Dillard's, None Pembroke Pines, N/A 335,836 JCPenney, Sears Florida Prince Kuhio Plaza 1985/ 50 504,387/ JCPenney, Liberty House, One Hilo, Hawaii 1994,1999 165,061 Sears Quail Springs 1980/ 50 1,127,030/ Dillard's, Foley's, None Oklahoma City, 1992,1998,1999 333,258 JCPenney, Sears Oklahoma Steeplegate Mall 1990/ 50 483,109/ JCPenney, Sears, None Concord, N/A 185,506 The Bon Ton New Hampshire Stonebriar Centre 2000/ 50 1,648,094/ Foley's, JCPenney, One Frisco (Dallas), Texas N/A 524,013 Macy's, Nordstrom, Sears Superstition Springs 1990/ 16.7 1,073,726/ Dillard's, JCPenney, Mervyn's, None East Mesa, Arizona 1994 367,032 Robinson-May, Sears Town East Mall 1971/ 50 1,256,888/ Dillard's, Foley's, JCPenney, None Mesquite, Texas 1986 425,482 Sears
19
Ownership Total GLA/Mall Year Opened/ Interest % and Freestanding Name of Center/ Remodeled or of Operating GLA Square Feet Anchor Location (/1/) Expanded Partnership (/2/) Anchors Vacancies - ----------------------- ------------ ------------ ---------------- ----------------------------- --------- Tysons Galleria 1988/ 50 810,710/ Macy's, Neiman Marcus, None McLean, Virginia 1994,1997 298,777 Saks Fifth Avenue Vista Ridge Mall 1989/ 50 1,053,369/ Dillard's, Foley's, None Lewisville, Texas 1991 380,307 JCPenney, Sears Washington Park Mall 1984/ 50 351,469/ Dillard's, JCPenney, None Bartlesville, Oklahoma 1986 157,173 Sears West Oaks Mall 1996/ 50 1,071,183/ Dillard's, JCPenney, None Ocoee (Orlando), Florida 1998 365,854 Parisian, Sears Westroads Mall 1968/ 51 1,085,515/ JCPenney, The Jones Store, None Omaha, Nebraska 1995,1999 373,895 Von Maur, Younkers The Woodlands Mall 1994/ 25 1,177,816/ Dillard's, Foley's, JCPenney, None The Woodlands, 1998 351,301 Mervyn's, Sears (Houston), Texas
- -------- (1) In certain cases where a Center's location is part of a larger metropolitan area, the metropolitan area is identified in parenthesis. (2) Includes square footage added in redevelopment/expansion projects. 20 Anchors Anchors have traditionally been a major factor in the public's image of an enclosed shopping center. Anchors are generally department stores whose merchandise appeals to a broad range of shoppers. Anchors either own their stores, the land under them and adjacent parking areas, or enter into long-term leases at rates that are generally lower than the rents charged to Mall Store tenants. Although the Portfolio Centers receive a smaller percentage of their operating income from Anchors than from Mall Stores, strong Anchors play an important part in maintaining customer traffic and making the Portfolio Centers desirable locations for Mall Store tenants. The following table indicates the parent company of each Anchor and sets forth the number of stores and square feet owned or leased by each Anchor at the Portfolio Centers as of December 31, 2000. GENERAL GROWTH PROPERTIES, INC. PORTFOLIO ANCHORS AS OF DECEMBER 31, 2000
Total Square Feet Name Stores (000's) ----------------------------------------------- ------ ----------- Sears 82 11,775 JCPenney 79 8,957 Dillard's Inc. Dillard's 41 6,487 Dillard's Home Store 1 22 --- ------ Sub-Total Dillard's Inc. 42 6,409 === ====== Target Corporation Target 16 1,758 Mervyn's 16 1,353 Marshall Fields 3 692 Dayton's 4 532 Hudson's 6 695 --- ------ Sub-Total Target Corporation 45 5,030 === ====== May Department Stores Company Foley's 11 1,623 Robinson's-May 6 985 Filene's 3 520 Filene's Home Store 1 36 Lord & Taylor 5 577 Strawbridge and Clothier 1 218 Hecht's 2 345 Famous Barr 2 272 The Jones Store 1 175 --- ------ Sub-Total May Department Stores Company 34 4,949 === ====== Federated Department Stores, Inc. Macy's 14 2,512 Rich's 5 937 Burdines 5 676 The Bon Marche 2 321 Lazarus 1 50 --- ------ Sub-Total Federated Department Stores, Inc. 27 4,496 === ======
21 GENERAL GROWTH PROPERTIES, INC. PORTFOLIO ANCHORS AS OF DECEMBER 31, 2000 (continued)
Total Square Feet Name Stores (000's) ---------------------------------------- ------ ----------- Saks Holdings Incorporated Younkers 8 982 Parisian 3 395 Carson Pirie Scott 1 138 Boston Store 1 211 Bergners 1 154 McRae's 1 124 Saks Fifth Avenue 1 120 Proffitt's 1 90 Herberger's 1 71 --- ----- Sub-Total Saks Holdings Incorporated 18 2,285 === ===== Montgomery Ward & Co. 7 907 Belk Belk 9 1,144 Belk Men's 1 34 --- ----- Sub-Total Belk 10 1,178 === ===== Kohl's 6 544 Neiman-Marcus 3 423 Boscov 4 552 Liberty House 2 377 KMart 3 301 The Bon Ton 3 312 Gottschalks 3 268 Nordstrom 3 388 Wal-Mart 2 196 Von Maur 1 179 Scheel's All Sports 2 155 Harris 1 150 Elder-Beerman 3 141 Cub Foods 1 130 Ames 2 176 Burlington Coat Factory 1 101 Galyans 1 100 Dick's Sporting Goods 1 80 Oshman's 1 64 Service Merchandise 1 59 Rosa's Home Store 1 57 Beall's 2 56 The Emporium 1 50 Toys "R" Us 1 47 Winn-Dixie 1 47 Stein Mart 1 39 Stage 1 35 Old Navy Clothing Company 1 34 Ross Dress for Less 1 28
22 Ground Leases The Company currently leases the land under Rio West Mall, a portion of the Fallbrook Mall land and a portion of the SouthShore and Bayshore parking areas. In addition, Prince Kuhio Plaza, one of the Homart Centers, and the office building owned and used by the Company as its headquarters are subject to long-term ground leases. The leases generally contain various purchase options in favor of the Company and typically provide for a right of first refusal in favor of the Company in the event of a proposed sale of the property by the landlord. For other information concerning the Portfolio Centers see "Item 1--Business--Business of the Company" and for additional information concerning the mortgage debt encumbering the Wholly-Owned Centers, see Note 5. As stated in Item 1 above, management of the Company believes that each of the properties in the Company Portfolio is adequately insured. ITEM 3. LEGAL The Company is not currently involved in any material PROCEEDINGS litigation nor, to the Company's knowledge, is any material litigation currently threatened against the Company, the properties or any of the Unconsolidated Joint Ventures other than routine litigation arising in the ordinary course of business, most of which is expected to be covered by liability insurance. For information about certain environmental matters, see "Item 1--Business--Environmental Matters." ITEM 4. SUBMISSIONNo matters were submitted to a vote of General Growth's OF MATTERS TO Astockholders during the fourth quarter of fiscal 2000. VOTE OF SECURITY HOLDERS PART II ITEM 5. MARKET The Common Stock is listed on the New York Stock Exchange FOR REGISTRANT'S ("NYSE") and trades under the symbol "GGP". As of March 14, COMMON EQUITY 2001, the 52,374,034 outstanding shares of Common Stock were AND RELATED held by approximately 1,388 stockholders of record. The STOCKHOLDER closing price per share of the Common Stock on the NYSE on MATTERS such date was $34.40 per share. Set forth below are the high and low sales prices per share of Common Stock as reported on the composite tape, and the distributions per share of Common Stock declared for each such period.
Price 2000 ------------- Quarter Declared Ended High Low Distribution ------- ------ ------ ------------ March 31 $30.56 $30.44 $.51 June 30 $32.60 $31.75 $.51 September 30 $33.06 $32.19 $.51 December 31 $36.50 $36.12 $.53
Price 1999 ------------- Quarter Declared Ended High Low Distribution ------- ------ ------ ------------ March 31 $38.44 $31.25 $.49 June 30 $38.63 $31.13 $.49 September 30 $35.63 $31.06 $.49 December 31 $31.69 $25.00 $.51
23
Price 1998 ------------- Quarter Declared Ended High Low Distribution ------- ------ ------ ------------ March 31 $38.00 $34.88 $.47 June 30 $38.63 $34.44 $.47 September 30 $38.69 $33.19 $.47 December 31 $37.94 $32.88 $.47
ITEM 6. SELECTED FINANCIAL DATA (Dollars in Thousands, except per Share Amounts) The following table sets forth selected financial data for the Company which is derived from and therefore should be read in conjunction with the audited Consolidated Financial Statements and the related Notes and Management's Discussion and Analysis of Financial Condition and Results of Operations contained in this Annual Report.
2000 1999 1998 1997 1996 --------- ----------- ----------- --------- -------- OPERATING DATA Revenue $ 698,767 $ 612,342 $ 426,576 $ 291,147 $217,405 Operating Expenses 226,234 206,088 151,784 109,677 75,954 Depreciation and Amortization 126,689 112,874 75,227 48,509 39,809 Interest Expense, Net 205,623 169,502 109,840 70,252 66,439 Equity in Net Income of Unconsolidated Affiliates 50,063 19,689 11,067 19,344 17,589 Net gain on sales including CenterMark in 1997 & 1996 44 4,412 196 58,647 43,821 --------- ----------- ----------- --------- -------- Income Before Minority Interest 190,328 147,979 100,988 140,700 96,613 Minority Interest (52,380) (33,058) (29,794) (49,997) (34,580) --------- ----------- ----------- --------- -------- Income Before Extraordinary Items 137,948 114,921 71,194 90,703 62,033 Extraordinary Items -- (13,796) (4,749) (1,152) (2,291) --------- ----------- ----------- --------- -------- Net Income 137,948 101,125 66,445 89,551 59,742 --------- ----------- ----------- --------- -------- Convertible Preferred Stock Dividends (24,467) (24,467) (13,433) -- -- Net Income available to common stockholders $ 113,481 $ 76,658 $ 53,012 $ 89,551 $ 59,742 ========= =========== =========== ========= ======== Earnings Before Extraordinary Item Per Share--Basic 2.18 1.97 1.60 2.78 2.20 Earnings Before Extraordinary Item Per Share--Diluted 2.18 1.96 1.59 2.76 2.20 Net Earnings Per Share-- Basic 2.18 1.67 1.46 2.75 2.12 Net Earnings Per Share-- Diluted 2.18 1.66 1.46 2.73 2.12 Distributions Declared Per Share 2.06 1.98 1.88 1.80 1.72 CASH FLOW DATA Operating Activities $ 309,474 $ 222,134 $ 118,304 $ 101,149 $ 67,202 Investing Activities (379,285) (1,254,697) (1,513,147) (183,535) (29,285) Financing Activities 71,447 1,038,526 1,388,575 92,337 (40,268) FUNDS FROM OPERATIONS (/1/) Operating Partnership $ 330,299 $ 274,234 $ 192,274 $ 147,625 $114,721 Minority Interest (90,805) (82,631) (69,182) (52,890) (42,115) Funds From Operations-- Company 239,494 191,603 123,092 94,735 72,606
24 BALANCE SHEET DATA Investment in Real Estate Assets--Cost $5,439,466 $5,023,690 $4,063,097 $2,157,251 $1,828,184 Total Assets 5,284,104 4,954,895 4,027,474 2,097,719 1,757,717 Total Debt 3,244,126 3,119,534 2,648,776 1,275,785 1,168,522 Redeemable Preferred Units 175,000 -- -- -- -- Convertible Preferred Stock 337,500 337,500 337,500 -- -- Stockholders' Equity 938,418 927,758 585,707 498,505 330,267
- -------- (1) Funds from Operations (as defined below) does not represent cash flow from operations as defined by Generally Accepted Accounting Principles ("GAAP") and is not necessarily indicative of cash available to fund all cash requirements. Funds From Funds from Operations is used by the real estate industry Operations and investment community as a primary measure of the performance of real estate companies. As revised in October 1999, the National Association of Real Estate Investment Trusts ("NAREIT") defines Funds from Operations as net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from debt restructuring and sales of properties, plus real estate related depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures. In calculating its Funds from Operations, the Company also excluded gains on land sales, if any, through 1999. The NAREIT definition of Funds from Operations does not exclude the aforementioned item. The Company's Funds from Operations may not be directly comparable to similarly titled measures reported by other real estate investment trusts. Funds from Operations does not represent cash flow from operating activities in accordance with GAAP and should not be considered as an alternative to net income (determined in accordance with GAAP) as an indication of the Company's financial performance or to cash flow from operating activities (determined in accordance with GAAP) as a measure of the Company's liquidity, nor is it indicative of funds available to fund the Company's cash needs, including its ability to make cash distributions. RECONCILIATION OF NET INCOME DETERMINED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES TO FUNDS FROM OPERATIONS:
2000 1999 1998 -------- -------- -------- Net Income available to common stockholders $113,481 $ 76,658 $ 53,012 Extraordinary item--charges related to early retirement of debt -- 13,796 4,749 Allocations to Operating Partnership unitholders 43,026 33,058 29,794 Net loss (gain) on sales 1,005 (4,412) (196) Depreciation and amortization 172,787 155,134 104,915 -------- -------- -------- Funds From Operations $330,299 $274,234 $192,274 ======== ======== ========
25 GENERAL GROWTH PROPERTIES, INC. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS All references to numbered Notes are to specific footnotes to the Consolidated Financial Statements of the Company included in this Annual Report, which descriptions are incorporated into the applicable response by reference. The following discussion should be read in conjunction with such Consolidated Financial Statements and related Notes. Capitalized terms used but not defined in this Management's Discussion of Financial Condition and Results of Operations have the same meanings as in such Notes. Forward-Looking Forward-looking statements contained in this Annual Report Information on Form 10-K may include certain forward-looking information statements, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including (without limitation) statements with respect to anticipated future operating and financial performance, growth and acquisition opportunities and other similar forecasts and statements of expectation. Words such as "expects", "anticipates", "intends", "plans", "believes", "seeks", "estimates" and "should" and variations of these words and similar expressions, are intended to identify these forward- looking statements. Forward-looking statements made by the Company and its management are based on estimates, projections, beliefs and assumptions of management at the time of such statements and are not guarantees of future performance. The Company disclaims any obligation to update or revise any forward-looking statement based on the occurrence of future events, the receipt of new information or otherwise. Actual future performance, outcomes and results may differ materially from those expressed in forward-looking statements made by the Company and its management as a result of a number of risks, uncertainties and assumptions. Representative examples of these factors include (without limitation) general industry and economic conditions, interest rate trends, cost of capital and capital requirements, availability of real estate properties, competition from other companies and venues for the sale/distribution of goods and services, changes in retail rental rates in the Company's markets, shifts in customer demands, tenant bankruptcies or store closures, changes in vacancy rates at the Company's properties, changes in operating expenses, including employee wages, benefits and training, governmental and public policy changes, changes in applicable laws, rules and regulations (including changes in tax laws), the ability to obtain suitable equity and/or debt financing, and the continued availability of financing in the amounts and on the terms necessary to support the Company's future business. Certain As of December 31, 2000, the Company owned 100% of the Information fifty-three Wholly-Owned Centers, 50% of the stock of About The GGP/Homart, 50% of the membership interest in GGP/Homart II, Company 51% of the stock of GGP Ivanhoe, 51% of the stock of GGP Portfolio Ivanhoe III, 50% of Quail Springs Mall and Town East Mall, (collectively, the "Company Portfolio") and a non-voting preferred stock ownership interest (representing 95% of the equity interest) in GGMI. On January 1, 2001, the Operating Partnership purchased the common stock of GGMI and the preferred stock of GGMI, which was 100% owned by the Company, was cancelled as discussed below. 26 GENERAL GROWTH PROPERTIES, INC. Reference is made to Notes 3 and 4 for a further discussion of such entities owned by the Company. As of December 31, 2000, GGP/Homart owned interests in twenty-three shopping centers, GGP/Homart II owned interests in seven shopping centers, GGP Ivanhoe owned interests in two shopping centers, and GGP Ivanhoe III owned interests in eight shopping centers. As used in this Annual Report, the term "GLA" refers to gross leaseable retail space, including Anchors and mall tenant areas; the term "Mall GLA" refers to gross leaseable retail space, excluding Anchors; the term "Anchor" refers to a department store or other large retail store; the term "Mall Stores" refers to stores (other than Anchors) that are typically specialty retailers who lease space in shopping centers; and the term "Freestanding GLA" means gross leaseable area of freestanding retail stores in locations that are not attached to the primary complex of buildings that comprise a regional mall shopping center. The Mall Store and Freestanding Store portions of the centers in the Company Portfolio which were not undergoing redevelopment on December 31, 1999, had an occupancy rate of approximately 90.1% as of such date. On December 31, 2000, the Mall Store and Freestanding Store portions of the centers in the Company Portfolio which were not undergoing redevelopment were approximately 91.0% occupied, representing an increase in occupancy percentage of 0.9% over 1999. Total annualized sales averaged $357 per square foot for the Company Portfolio for the year ended December 31, 2000, an increase of $16 per square foot over the comparable amount for 1999. For the year ended December 31, 2000, total Mall Store sales for the Company Portfolio increased by 7.4% over the same period in 1999. Comparable Mall Store sales are current sales of those certain tenants that were open during the previous measuring period compared to the sales of those same tenants for the previous measuring period. Therefore, Comparable Mall Store sales in the year ended December 31, 2000 are of those tenants that were also operating for the full year ended December 31, 1999. Comparable Mall Store sales in the year ended December 31, 2000 increased by 2.4% over the same period in 1999. The average Mall Store rent per square foot from leases that expired in the year ended December 31, 2000 was $29.29. The Company Portfolio benefited from increasing rents inasmuch as the average Mall Store rent per square foot on new and renewal leases executed during 2000 was $35.24, or $5.95 per square foot above the average for expiring leases. RESULTS OF OPERATIONS OF General: THE COMPANY Company revenues are primarily derived from fixed minimum rents, overage rents and recoveries of operating expenses from tenants. Inasmuch as the Company's financial statements reflect the use of the equity method to account for its investments in GGP/Homart, GGP/Homart II, GGP Ivanhoe, GGP Ivanhoe III, GGMI, Quail Springs Mall and Town East Mall, the discussion of results of operations which follows relates primarily to the revenues and expenses of the Wholly-Owned Centers. In addition, during 1999, the Company opened Rivertown Crossings and purchased interests in the following Wholly-Owned Centers: The Crossroads, Ala Moana, and Baybrook. Also 27 GENERAL GROWTH PROPERTIES, INC. during 1999, the Company contributed its 100% interests in one development project, Stonebriar, as well as three operating properties, Northbrook Court, Natick, and Altamonte to GGP/Homart II, an unconsolidated entity. During April 2000, the Company purchased a 100% interest in Crossroads Center. For purposes of the following discussion of the results of operations, the net effect of acquisitions will include the effect of the Rivertown Crossings opening, the effect of the new acquisitions in 1999 and 2000 and the effect of the three operating properties contributed to GGP/Homart II. Comparison of Year Ended December 31, 2000 To Year Ended December 31, 1999 Total revenues for 2000 were $698.8 million, which represents an increase of $86.5 million or approximately 14.1% from $612.3 million in 1999. Approximately $46.5 million or 52.7% of the increase was from properties acquired or developed after July 30, 1999. Minimum rent during 2000 increased $52.5 million or 13.5% from $387.5 million in 1999 to $440 million. The acquisition and development of properties generated a $27.9 million increase in minimum rents. Expansion space, specialty leasing and a combination of occupancy, rental charges and allowance reserve adjustments at the comparable centers accounted for the remaining increase in minimum rents. Tenant recoveries increased by $32.9 million or 18.2% from $180.6 million to $213.5 million in 2000. The increase in tenant recoveries was generated by a combination of new acquisitions and increased recoverable operating costs at the comparable centers. Overage rents increased $1.6 million or 6.0% from $27.0 million in 1999 to $28.6 million in 2000 as a result of the acquisition of new properties and improved performance at the comparable centers. Fee income for 2000 increased $1.6 million or 29.6% from $5.4 million in 1999 to $7.0 million in 2000. The fee revenue was primarily generated by asset management services performed for GGP/Homart and GGP/Homart II. Total expenses, including depreciation and amortization, increased by approximately 10.6% or $33.9 million, from $319 million in 1999 to $352.9 million in 2000. The majority of the increase in total expenses was attributable to properties acquired and developed in 1999 and 2000. The increase in total expenses from the new properties consists primarily of approximately $3.6 million of real estate taxes, $9.9 million of property operating costs, and $6.0 million of depreciation and amortization. Interest expense increased by $32.1 million or 17.3% from $186 million in 1999 to $218.1 million in 2000, substantially all due to indebtedness incurred in connection with the acquisition of new properties in 1999 and 2000. The note receivable from GGMI generated $6.8 million of interest income in 2000, a decrease of $4.6 million from $11.4 million in 1999. Equity in net income of unconsolidated affiliates during 2000 increased by $30.3 million to $50.0 million from $19.7 million in 1999. GGP/Homart II accounted for an increase of approximately $19.0 million. The Company's ownership interest in GGMI resulted in an increase of $11.1 million.. Net income after extraordinary items increased by approximately $36.8 million in 2000 to $137.9 million, from $101.1 million in 1999. The increase resulted from a combination of the above items. 28 GENERAL GROWTH PROPERTIES, INC. Comparison of Year Ended December 31, 1999 To Year Ended December 31, 1998 Total revenues for 1999 were $612.3 million, which represents an increase of $185.7 million or approximately 43.5% from $426.6 million in 1998. Approximately $168.2 million of the increase was from properties acquired or developed after January 1, 1998. Minimum rent during 1999 increased $118.5 million or 44.1% from $269.0 million in 1998 to $387.5 million. $103.8 million of the increase in minimum rent resulted from the acquisition and development of properties after January 1, 1998. Tenant recoveries (amounts received from tenants related to property operating costs) increased by $49.7 million or 38.0% from $130.9 million to $180.6 million in 1999. The increase in tenant recoveries was generated by a combination of new acquisitions and increased recoverable operating costs at the comparable centers (properties owned for the entire time during current and prior periods). Overage rents and other income increased $16.8 million or 76.4% from $22.0 million in 1998 to $38.8 million in 1999 primarily due to the acquisition of new properties and improved performance at the comparable centers. Fee income increased slightly during 1999 as compared to the year ended December 31, 1998 primarily due to fee revenue generated by asset management services performed for the Unconsolidated Joint Ventures. Total expenses, including depreciation and amortization, increased by approximately 40.5% or $92 million, from $227.0 million in 1998 to $319 million in 1999. Approximately $86.5 million or 94.0% of the increase in total expenses related to properties acquired and developed since January 1, 1998. The remaining $5.5 million of the increase was primarily accounted for by increased operating costs, the majority of which were recoverable from tenants. The increase in total expenses consists of $12 million of real estate taxes, $2.3 million of management fees, $36.6 million of property operating costs, $2.0 million of provision for doubtful accounts, $1.3 million of general and administrative and $37.6 million of depreciation and amortization. Interest expense increased by $60.2 million or 47.8% from $125.8 million in 1998 to $186 million in 1999. Debt used to fund acquisitions generated a $53.9 million increase in interest expense in 1999 compared to 1998. This increase was partially offset by the use of a portion of the proceeds of the Company's public offering of Common Stock to repay existing indebtedness. The note receivable from GGMI generated $11.4 million of interest income in 1999, an increase of $0.7 million from $10.7 million in 1998. Net income after extraordinary items increased by approximately $34.7 million in 1999 to $101.1 million from $66.4 million in 1998. The increase resulted from a combination of the above items. Liquidity and As of December 31, 2000, the Company held approximately Capital $27.2 million of unrestricted cash and cash equivalents. The Resources of Company uses operating cash flow as the principal source of The Company internal funding for short-term liquidity and capital needs such as tenant construction allowances and minor improvements made to individual properties that are not recoverable through common area maintenance charges to tenants. External funding alternatives for longer-term liquidity needs such as acquisitions, new development, expansions and major renovation programs at individual centers include construction loans, mini-permanent loans, long-term project financing, joint venture 29 GENERAL GROWTH PROPERTIES, INC. financing with institutional partners, additional Operating Partnership level or Company level equity securities, unsecured Company level debt or secured loans collateralized by individual shopping centers. In addition, the Company has access to the public equity and debt markets through a currently effective shelf registration statement under which up to $329.2 million in equity or debt securities may be issued from time to time. The Company also has a revolving credit facility and term loans (with a collective balance of approximately $265 million at December 31, 2000) which mature on July 31, 2003 as discussed below. The Company currently anticipates that it will be able to increase, if necessary, the aggregate principal amounts available to be borrowed under such facilities from an aggregate of $390 million as of December 31, 2000 to $650 million. As of December 31, 2000, the Company had consolidated debt of approximately $3,244 million, of which $1,833 million is comprised of debt bearing interest at a fixed rate, with the remaining $1,411 million bearing interest at floating rates. Reference is made to Note 5 and Items 2 and 7A of the Company's Annual Report on Form 10-K for additional information regarding the Company's debt and the potential impact on the Company of interest rate fluctuations. The following summarizes certain significant investment and financing transactions currently planned or completed since December 31,1999: The Company had previously advanced approximately $31 million collateralized by a second mortgage on the Crossroads Center in St. Cloud (Minneapolis), Minnesota. In connection with the second mortgage (as modified in February 2000) the Company acquired the property in April 2000 as further described in Note 3. In January 2000, the Company obtained a new $200 million unsecured short-term bank loan. The Company's initial draw under this loan was $120 million which was used to fund ongoing redevelopment projects and repay an $83 million interim loan obtained in September 1999. This loan bore interest at LIBOR plus 150 basis points and the remaining available amounts were drawn by June 30, 2000. The loan was repaid on August 1, 2000 with the proceeds of a new revolving credit facility (the "Revolver") and the term loan (the "Term Loan") described below. In May 2000, the Company received approximately $170.6 million of net proceeds through the issuance of preferred units of membership interest in GGPLP L.L.C. as more fully described in Note 1. These units provide for annual 8.95% preferred distributions and have a liquidation preference of $175 million. The net proceeds were used primarily to reduce the Company's outstanding short-term floating rate debt. As of July 31, 2000, the Company completed the refinancing of its Credit Facility. The Company's outstanding draws under the Revolver, its new unsecured revolving credit facility, were approximately $35 million as of December 31, 2000. The Revolver has a maturity of July 31, 2003 and bears interest at a rate per annum equal to LIBOR plus 100 to 190 basis points depending on the Company's average leverage ratio. In addition, the Company obtained an unsecured Term Loan which had an outstanding balance of $230 million at December 31, 2000. The Term Loan has a maturity of July 31, 2003 and bears interest at a rate per annum equal to LIBOR plus 100 to 170 basis points depending on the Company's average leverage ratio. 30 GENERAL GROWTH PROPERTIES, INC. In December 2000, the Company obtained an additional $20 million mortgage loan collateralized by the Valley Hills Mall. The new mortgage loan is payable interest only until maturity at a rate of 7.91% per annum and matures in February 2004. In January 2001, GGMI borrowed $37.5 million under a new revolving line of credit obtained by GGMI and an affiliate, which is guaranteed by General Growth and the Operating Partnership. The interest rate per annum with respect to any borrowings varies from LIBOR plus 100 to 190 basis points depending on the Company's average leverage ratio and the revolving line of credit matures in July 2003. Approximately $392 million of the Company's debt is scheduled to mature in 2001. Although agreements to refinance all of such indebtedness have not yet been reached, the Company anticipates that all of its debt will be repaid on a timely basis. Other than as described above or in conjunction with possible future acquisitions, there are no current plans to incur additional debt, increase the amounts available under the Revolver or Term Loans or raise equity capital. If additional capital is required, the Company believes that it can increase the amounts available under the Revolver or Term Loans, obtain an interim bank loan, obtain additional mortgage financing on under- leveraged assets, enter into new joint venture partnership arrangements or raise additional debt or equity capital. However, there can be no assurance that the Company can obtain such financing on satisfactory terms. The Company will continue to monitor its capital structure, investigate potential investments or joint venture partnership arrangements and purchase additional properties if they can be acquired and financed on terms that the Company reasonably believes will enhance long-term stockholder value. When property operating cash flow has been increased, the Company anticipates the refinancing of portions of its long-term floating rate debt with pooled or property- specific non-recourse fixed-rate mortgage financing. Accordingly, the Company anticipates that up to approximately $1,000 million of collateralized floating rate debt may be replaced in 2001 with new floating rate or long- term fixed rate mortgage financing. Net cash provided by operating activities was $309.5 million in 2000, an increase of $87.4 million from $222.1 million in the same period in 1999. Net income before allocations to the minority interest increased $42.3 million, which was primarily due to earnings attributable to properties acquired in 2000 and 1999. Summary of Net cash used by investing activities was $379.3 million in Investing 2000 compared to $1,254.7 million of cash used in 1999. Cash Activities flow from investing activities was impacted by acquisitions, development and improvements to real estate properties, which utilized cash of approximately $286.7 million in 2000 and $1,248.4 million in 1999 due to fewer acquisitions of investment property in 2000 as compared to 1999. Net cash used by investing activities in 1999 was $1,254.7 million, compared to a use of $1,513.1 million in 1998. Cash flow from investing activities was affected by the timing of acquisitions, development and improvements to real estate properties, requiring a use of cash of approximately $1,248.4 million in 1999 compared to $1,360.1 million in 1998. 31 GENERAL GROWTH PROPERTIES, INC. Summary of Financing activities in 2000 provided $71.4 million of cash Financing compared to a $1,038.5 million source of cash flow in 1999. Activities The proceeds from the issuance of the preferred units of membership interest provided approximately $170.6 million of cash from financing activities in 2000. The majority of the cash flow from financing activities in 1999 were from the $1,736.1 million of proceeds of mortgage and other notes payable. Distributions to common stockholders and the minority interests in the Operating Partnership were $152.5 million in 2000 compared to $120.8 million in 1999. The increase in distributions is due to the increased distribution rate on the Common Stock and Operating Partnership Units during 2000 compared to 1999 as well as the issuance of the preferred units of membership interest as discussed above and in Note 1. Financing activities provided cash of $1,038.5 million in 1999, compared to $1,388.6 million in 1998. The Common Stock offering in July 1999 provided net proceeds of approximately $330.3 million which, as described in Note 1, was utilized to reduce outstanding indebtedness and to fund the acquisition of the Ala Moana Center. As also described in Note 1, General Growth completed a public offering of preferred stock in June 1998, the net proceeds of which (approximately $322.7 million) were used primarily to reduce acquisition-related financing and amounts drawn on the Company's Credit Facility. Such payments are reflected in the use of cash for financing activities for principal payments on mortgage notes and other debt in 1999 and 1998. An additional significant contribution of cash from financing activity is financing from mortgages and acquisition debt, which had a positive impact of $1,736 million in 1999 versus approximately $2,093 million in 1998. The additional financing was used to repay existing indebtedness and to fund the acquisitions and redevelopment of real estate as discussed above. The remaining uses of cash consisted primarily of increased distributions (including dividends paid to preferred stockholders in 1999 and 1998). General Growth has established a Dividend Reinvestment and Stock Purchase Plan ("DRSP") under which it has reserved for issuance up to 1,000,000 shares of Common Stock. The DRSP, in general, allows participants to make purchases of Common Stock from dividends received or additional cash investments. Although the purchase price of the Common Stock is determined by the current market price, the purchases are made without fees or commissions. General Growth can satisfy DRSP Common Stock purchase needs through the issuance of new shares of Common Stock or by repurchases of currently outstanding Common Stock. Any new issuances of Common Stock pursuant to the DRSP will not reduce amounts otherwise available under the Company's currently effective shelf- registration described above. REIT In order to remain qualified as a real estate investment Requirements trust for federal income tax purposes, the Company must distribute 100% of capital gains and at least 95% (90% in 2001 and subsequent years) of its ordinary taxable income to stockholders. The following factors, among others, will affect operating cash flow and, accordingly, influence the decisions of the Board of Directors regarding distributions: (i) scheduled increases in base rents of existing leases; (ii) changes in minimum base rents and/or percentage rents attributable to replacement of existing leases with new or renewal leases; (iii) changes in occupancy rates at existing centers and procurement of leases for newly developed centers; and (iv) the Company's share of operating cash flow 32 GENERAL GROWTH PROPERTIES, INC. generated by the Unconsolidated Joint Ventures, to the extent distributed to the Company, less oversight costs and debt service on additional loans that have been or will be incurred to finance Company acquisitions. The Company anticipates that its operating cash flow, and potential new debt or equity from future offerings, new financings or refinancings will provide adequate liquidity to conduct its operations, fund general and administrative expenses, fund operating costs and interest payments and allow distributions to the Company's preferred and common stockholders in accordance with the requirements of the Internal Revenue Code of 1986, as amended, for continued qualification as a real estate investment trust and to avoid any Company level federal income or excise tax and will elect to have GGMI treated as a TRS. On January 1, 2001 the REIT provisions of the Tax Relief Extension Act of 1999 became effective. Among other things, the law permits a REIT to own up to 100% of the stock of a TRS. A TRS, which must pay corporate income tax, can provide services to REIT tenants and others without disqualifying the rents that a REIT receives from its tenants. Accordingly, on January 1, 2001 the Company acquired for nominal consideration 100% of the common stock of GGMI and will elect to have GGMI treated as a TRS. In connection with the acquisition, the GGMI preferred stock owned by the Company was cancelled and approximately $40 million of the outstanding loans owed by GGMI to the Company were contributed to the capital of GGMI. The Company and GGMI concurrently terminated the management contracts for the Wholly-Owned Centers as the management activities will be performed directly by the Company. GGMI will continue to manage, lease, and perform various other services for the Unconsolidated Centers and other properties owned by unaffiliated third parties. Recently Issued As more fully described in Note 12, certain accounting Accounting pronouncements were issued in 2000, which became effective Pronouncements in 2000 or will become effective in 2001. The Company does not expect the application of such new pronouncements to have a significant impact on its annual reported results of operations. Economic Inflation has been relatively low and has not had a Conditions significant detrimental impact on the Company. Should inflation rates increase in the future, substantially all of the Company's tenant leases contain provisions designed to mitigate the negative impact of inflation. Such provisions include clauses enabling the Company to receive percentage rents based on tenants' gross sales, which generally increase as prices rise, and/or escalation clauses, which generally increase rental rates during the terms of the leases. In addition, many of the leases are for terms of less than 10 years which may enable the Company to replace or renew expiring leases with new leases at higher base and/or percentage rents, if rents under the expiring leases are below the then-existing market rates. Finally, most of the existing leases require the tenants to pay their share of certain operating expenses, including common area maintenance, real estate taxes and insurance, thereby reducing the Company's exposure to increases in costs and operating expenses resulting from inflation. Inflation also poses a potential threat to the Company due to the possibility of future increases in interest rates. Such increases would adversely impact the Company due to the amount of its outstanding floating rate debt. However, in recent years, the Company's ratio of interest expense to cash flow has continued to decrease. Therefore, 33 GENERAL GROWTH PROPERTIES, INC. the relative risk the Company bears due to interest expense exposure has been declining. In addition, the Company has limited its exposure to interest rate increases on a portion of its floating rate debt by arranging interest rate cap agreements as described below. Finally, the Company has a policy of replacing floating rate debt with fixed rate debt as market conditions allow. (See Note 5). The current retail sector is experiencing declining growth and certain portions of the retail economy is in decline. Such reversals or reductions in the retail market adversely impacts the Company as demand for leasable space is reduced and rents computed as a percentage of tenant sales declines. In addition, the number of local, regional and national retailers, including tenants of the Company, filed for bankruptcy protection during the last few years. Most of the bankrupt retailers reorganized their operations and/or sold stores to stronger operators. Although some leases were terminated pursuant to the lease cancellation rights afforded by the bankruptcy laws, the impact on Company earnings was negligible. Over the last three years, the provision for doubtful accounts has averaged only $3.0 million per year, which represents less than 1% of average total revenues of $579.2 million. The Company and its affiliates currently have interests in 95 operating shopping centers. The Portfolio Centers are diversified both geographically and by property type (both major and middle market properties) and this may mitigate the impact of a potential economic downturn at a particular property or in a particular region of the country. The shopping center business is seasonal in nature. Mall stores typically achieve higher sales levels during the fourth quarter because of the holiday selling season. Although the Company has a year-long temporary leasing program, a significant portion of the rents received from short-term tenants are collected during the months of November and December. Thus, occupancy levels and revenue production are generally highest in the fourth quarter of each year and lower during the first and second quarters of each year. The Internet and electronic retailing are growing at significant rates. Although the amount of retail sales conducted solely via the Internet is expected to rise in the future, the Company believes that traditional retailing and "e-tailing" will converge such that the regional mall will continue to be a vital part of the overall mix of shopping alternatives for the consumer. In order to enhance the value and competitiveness of its properties through technology, the Company has commenced construction of an integrated broadband distribution system that will provide tenants at its properties with a private wide-area network, as well as supporting applications and equipment (the "Broadband System"), that will link tenants and mall locations via the Internet. The Company anticipates that the Broadband System will be installed and operating at substantially all of its properties before the end of the second quarter of 2001 as more fully discussed in Note 3. 34 GENERAL GROWTH PROPERTIES, INC. ITEM 7A. The Company has not entered into any transactions using QUANTITATIVE derivative commodity instruments. The Company is subject to AND QUALITATIVE market risk associated with changes in interest rates. DISCLOSURES Although the current interest rate trend is downward, the ABOUT MARKET economy during most of 2000 was in a period of rising RISK interest rates. Interest rate exposure is principally limited to the $1,411 million of consolidated debt of the Company outstanding at December 31, 2000 that is priced at interest rates that float with the market. A 25 basis point movement in the interest rate on the floating rate debt would result in an approximate $3.5 million annualized increase or decrease in interest expense and a corresponding opposite effect on cash flows. Additionally, approximately $856 million of such floating rate consolidated debt is comprised of commercial mortgage-backed securities which are subject to interest rate cap agreements, the effect of which is to limit the interest rate the Company would be required to pay on such debt to no more than approximately 9% per annum. The remaining $1,833 million of consolidated debt is fixed rate debt. The Company has an ongoing program of refinancing its floating and fixed rate debt and believes that this program allows it to vary its ratio of fixed to floating rate debt and to stagger its debt maturities in order to respond to changing market rate conditions. Reference is made to Note 5 for additional debt information. ITEM Reference is made to the Index to Financial Statements and 8. FINANCIAL Financial Statement Schedules on page F-1 for the required STATEMENTS AND information. SUPPLEMENTARY DATA ITEM 9. CHANGES Not applicable. IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 35 GENERAL GROWTH PROPERTIES, INC. PART III ITEM 10. DIRECTORSThe information which appears under the captions "Election AND EXECUTIVEof Directors" and "Executive Officers" in the Company's OFFICERS OF THEproxy statement for its 2001 Annual Meeting of Stockholders COMPANYis incorporated by reference into this Item 10. ITEM 11. EXECUTIVEThe information which appears under the caption "Executive COMPENSATIONCompensation" in the Company's proxy statement for its 2001 Annual Meeting of Stockholders is incorporated by reference into this Item 11; provided, however, that the Report of the Compensation Committee of the Board of Directors on Executive Compensation shall not be incorporated by reference herein, in any of the Company's previous filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, or in any of the Company's future filings. ITEM The information which appears under the captions "Certain 12. SECURITY Relationships and Related Party Transactions" and "Stock OWNERSHIP OF Ownership" in the Company's proxy statement for its 2001 CERTAIN Annual Meeting of Stockholders is incorporated by reference BENEFICIAL into this Item 12. OWNERS AND MANAGEMENT ITEM The information which appears under the caption 13. CERTAIN "Compensation Committee Interlocks and Insider RELATIONSHIPS Participation" and "Certain Relationships and Related Party AND RELATED Transactions" in the Company's proxy statement for its 2001 TRANSACTIONS Annual Meeting of Stockholders is incorporated by reference into this Item 13. PART IV ITEM (a) Financial Statements and Financial Statement Schedules. 14. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K The financial statements and schedules listed in the accompanying Index to Consolidated Financial Statements and Financial Statement Schedules are filed as part of this Annual Report on Form 10-K. (b) No reports on Form 8-K were filed by the Company during the last quarter of the period covered by this report. (c) Exhibits. See Exhibit Index on page S-1 36 GENERAL GROWTH PROPERTIES, INC. SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. GENERAL GROWTH PROPERTIES, INC. By: /s/ John Bucksbaum _______________________ John Bucksbaum, Chief Executive Officer March 14, 2001 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
Signature Title Date /s/ Matthew Bucksbaum __________________________ Matthew Bucksbaum Chairman of the Board March 14, 2001 /s/ Robert Michaels __________________________ Robert Michaels President and Director March 14, 2001 /s/ Bernard Freibaum __________________________ Bernard Freibaum Executive Vice President, Chief Financial Officer and Principal Accounting Officer March 14, 2001 /s/ Anthony Downs __________________________ Anthony Downs Director March 14, 2001 /s/ Morris Mark __________________________ Morris Mark Director March 14, 2001 /s/ Beth Stewart __________________________ Beth Stewart Director March 14, 2001 /s/ Lorne Weil __________________________ A. Lorne Weil Director March 14, 2001
37 GENERAL GROWTH PROPERTIES, INC. INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND CONSOLIDATED FINANCIAL STATEMENT SCHEDULE The following financial statements and financial statement schedule are included in Item 8 of this Annual Report on Form 10-K: General Growth Properties, Inc. Financial Statements Page(s) Report of Independent Accountants F-2 Consolidated Balance Sheets as of December 31, 2000 and 1999 F-3 Consolidated Statements of Operations and Comprehensive Income for the years ended December 31, 2000, 1999 and 1998 F-4 Consolidated Statements of Stockholders' Equity for the years ended December 31, 2000, 1999, and 1998 F-5 Consolidated Statements of Cash Flows for the years ended December 31, 2000, 1999, and 1998 F-7 Notes to Consolidated Financial Statements F-8 to F-37 Financial Statement Schedule Report of Independent Accountants F-38 Schedule III - Real Estate and Accumulated Depreciation F-39
All other schedules are omitted since the required information is not present or is not present in amounts sufficient to require submission of the schedule or because the information required is included in the consolidated financial statements and related notes. F-1 Report of Independent Accountants To the Board of Directors and Stockholders General Growth Properties, Inc. In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of operations and comprehensive income, of stockholders' equity and of cash flows present fairly, in all material respects, the financial position of General Growth Properties, Inc. at December 31, 2000 and 1999, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2000 in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Company's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States of America, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. Chicago, Illinois PricewaterhouseCoopers LLP February 6, 2001 F-2 GENERAL GROWTH PROPERTIES, INC. CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2000 AND 1999 (Dollars in thousands, except for per share amounts)
ASSETS December 31, ------ ---------------------- 2000 1999 ---------- ---------- Investment in real estate: Land $ 649,160 $ 640,276 Building and equipment 4,016,493 3,664,832 Less accumulated depreciation (488,130) (376,673) Developments in progress 25,547 21,443 ---------- ---------- Net property and equipment 4,203,070 3,949,878 Investments in Unconsolidated Real Estate Affiliates 748,266 666,074 Mortgage note receivable - 31,065 ---------- ---------- Net investment in Real Estate 4,951,336 4,647,017 Cash and cash equivalents 27,229 25,593 Tenant accounts receivable, net 96,157 84,123 Deferred expenses, net 105,534 93,536 Investment in and note receivable from General Growth Management, Inc. 66,079 65,307 Prepaid expenses and other assets 37,769 39,319 ---------- ---------- $5,284,104 $4,954,895 ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY ------------------------------------ Mortgage notes and other debt payable $3,244,126 $3,119,534 Distributions payable 47,509 42,695 Accounts payable and accrued expenses 186,393 170,868 ---------- ---------- 3,478,028 3,333,097 ---------- ---------- Minority interest Redeemable Preferred Units 175,000 Common Units 355,158 356,540 ---------- ---------- 530,158 356,540 ---------- ---------- Commitments and contingencies Preferred Stock: $100 par value; 5,000,000 shares authorized; 345,000 designated as PIERS (Note 1) which are convertible and carry a $1,000 liquidation value, 337,500 of which were issued and outstanding at December 31, 2000 and 1999 337,500 337,500 Stockholders' Equity: Common stock: $.10 par value; 210,000,000 shares authorized; 52,281,259 and 51,697,425 shares issued and outstanding as of December 31, 2000 and 1999, respectively 5,228 5,170 Additional paid-in capital 1,210,261 1,199,921 Retained earnings (deficit) (266,085) (272,199) Notes receivable-common stock purchases (9,449) (3,420) Accumulated equity in other comprehensive loss of unconsolidated affiliate (1,537) (1,714) ---------- ---------- Total stockholders' equity 938,418 927,758 ---------- ---------- $5,284,104 $4,954,895 ========== ==========
The accompanying notes are an integral part of these consolidated financial statements. F-3 GENERAL GROWTH PROPERTIES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Dollars in thousands, except for per share amounts)
Years ended December 31, 2000 1999 1998 --------- --------- --------- Revenues: Minimum rents $439,981 $387,547 $268,976 Tenant recoveries 213,502 180,584 130,903 Overage rents 28,626 27,011 16,226 Other 9,641 11,795 5,796 Fee income 7,017 5,405 4,675 --------- --------- --------- Total revenues 698,767 612,342 426,576 --------- --------- --------- Expenses: Real estate taxes 49,447 45,572 33,548 Management fees to affiliate 4,439 6,612 4,288 Property operating 163,972 143,622 106,986 Provision for doubtful accounts 2,025 4,425 2,451 General and administrative 6,351 5,857 4,511 Depreciation and amortization 126,689 112,874 75,227 --------- --------- --------- Total expenses 352,923 318,962 227,011 --------- --------- --------- Operating income 345,844 293,380 199,565 Interest income 12,452 16,482 16,011 Interest expense (218,075) (185,984) (125,851) Equity in net income/(loss) of unconsolidated affiliates 50,063 19,689 11,067 Gains on sales 44 4,412 196 Income before extraordinary items and allocation to minority interests 190,328 147,979 100,988 Income allocated to minority interest, including $9,354 applicable to Redeemable Preferred Units in 2000 (52,380) (33,058) (29,794) --------- --------- --------- Income before extraordinary items 137,948 114,921 71,194 Extraordinary items - (13,796) (4,749) --------- --------- --------- Net income 137,948 101,125 66,445 --------- --------- --------- Convertible Preferred Stock Dividends (24,467) (24,467) (13,433) --------- --------- --------- Net income available to common stockholders $113,481 $76,658 $53,012 ========= ========= ========= Earnings before extraordinary items per share-basic $2.18 $1.97 $1.60 ========= ========= ========= Earnings before extraordinary items per share-diluted $2.18 $1.96 $1.59 ========= ========= ========= Earnings per share-basic $2.18 $1.67 $1.46 ========= ========= ========= Earnings per share-diluted $2.18 $1.66 $1.46 ========= ========= ========= Net income $137,948 $101,125 $ 66,445 Other Comprehensive income (loss): Equity in unrealized income/(loss) on available-for-sale securities of unconsolidated affiliate, net of minority interest 177 (1,714) - --------- --------- --------- Comprehensive income $138,125 $99,411 $ 66,445 ========= ========= =========
The accompanying notes are an integral part of these consolidated financial statements. F-4 GENERAL GROWTH PROPERTIES, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Dollars in Thousands, except for Per Share Amounts)
Common Stock Additional Retained Employee Total ------------------ Paid-in Earnings Treasury Stock Stockholders' Shares Amount Capital (Deficit) Stock Loans Equity ---------- ------ ---------- --------- -------- -------- ------------- Balance, December 31, 1997 35,634,977 $3,577 $738,630 $(239,139) $(4,563) $ -- $498,505 Net income 66,445 66,445 Cash distributions declared ($1.88 per share) (68,940) (68,940) Convertible Preferred Stock Dividends (13,433) (13,433) Cost of issuance of preferred stock (14,814) (14,814) Exercise of stock options, net of employee stock loans 166,000 14 2,526 (530) 1, 154 (3,164) -- Purchase treasury stock (32,350) (1,136) (1,136) Conversion of operating partnership units to common stock 3,232,345 309 47,932 (2,670) 4,545 50,116 Adjustment for minority interest in operating partnership 68,964 68,964
- -------- continued on next page F-5 GENERAL GROWTH PROPERTIES, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Dollars in Thousands, except for Per Share Amounts) - continued -
Additional Retained Employee Total Common Stock Paid-in Earnings Treasury Stock Stockholders' Shares Amount Capital (Deficit) Stock Loans Equity ---------- ------ ---------- --------- -------- -------- ------------- Balance, December 31, 1998 39,000,972 $3,900 $ 843,238 $(258,267) $ - $(3,164) $585,707 ---------- ------ ---------- --------- --- ------- -------- Net income 101,125 101,125 Cash distributions declared ($1.98 per share) (90,590) (90,590) Convertible Preferred Stock Dividends (24,467) (24,467) Issuance of common stock, net of $1,929 of issuance costs 10,000,000 1,000 329,296 330,296 Exercise of stock options, net of employee stock loans 60,000 6 1,134 (380) 760 Reduction in employee stock loans Conversion of operating partnership units to common stock 124 124 Conversion of interests in GGP/Homart to Common Stock 2,603,291 261 90,252 90,513 Conversion of operating partnership units to common stock 33,162 3 519 522 Adjustment for minority interest in operating partnership (64,518) (64,518) ---------- ------ ---------- --------- --- ------- -------- Balance, December 31, 1999 51,697,425 5,170 1,199,921 (272,199) $ - (3,420) 929,472 ---------- ------ ---------- --------- --- ------- -------- Accumulated equity in other comprehensive loss of unconsolidated affiliate (1,714) -------- Adjusted Total $927,758 -------- Balance, December 31, 1999 51,697,425 5,170 1,199,921 (272,199) $ - (3,420) $929,472 ---------- ------ ---------- --------- --- ------- -------- Net income 137,948 137,948 Cash distributions declared ($2.06 per share) (107,367) (107,367) Convertible Preferred Stock Dividends (24,467) (24,467) RPU issuance costs (4,375) (4,375) Conversion of operating partnership units to common stock 212,050 21 5,490 5,511 Adjustment for minority interest in operating partnership (1,441) (1,441) Issuance of Common Stock, net of employee stock option loans 371,784 37 10,666 (6,029) 4,674 ---------- ------ ---------- --------- --- ------- -------- Balance, December 31, 2000 52,281,259 $5,228 $1,210,261 $(266,085) $ - $(9,449) $939,955 ========== ====== ========== ========= === ======= ======== Accumulated equity in other comprehensive loss of unconsolidated affiliate (1,537) -------- Adjusted Total $938,418 ========
The accompanying notes are an integral part of these consolidated financial statements. F-6 GENERAL GROWTH PROPERTIES,INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands, except for per share amounts)
Year ended December 31, ----------------------------------- 2000 1999 1998 --------- ----------- ----------- Cash flows from operating activities: Net Income $ 137,948 $ 101,125 $ 66,445 Adjustments to reconcile net income to net cash provided by operating activities: Minority interests 52,380 33,058 29,794 Extraordinary items - 10,454 - Equity in net income of unconsolidated affiliates (50,063) (19,689) (11,067) Provision for doubtful accounts 2,025 4,425 2,451 Distributions received from unconsolidated affiliates 37,523 29,825 21,672 Depreciation 111,457 105,046 68,494 Amortization 15,232 7,828 6,733 Gain on sales (44) (4,412) (196) Net Changes: Tenant accounts receivable (14,059) (26,856) (42,187) Prepaid expenses and other assets 1,550 (9,183) (6,557) Accounts payable and accrued expenses 15,525 (9,487) (17,278) --------- ----------- ----------- Net cash provided by (used in) operating activities 309,474 222,134 118,304 --------- ----------- ----------- Cash flows from investing activities: Acquisition/development of real estate and improvements and additions to properties (286,734) (1,248,371) (1,360,071) Increase in investments in unconsolidated affiliates (91,663) (55,361) (92,990) Increase in mortgage note receivable - (31,065) - Change in notes receivable from General Growth Management, Inc. (2,406) 6,671 (33,031) Reduction in employee stock loans - 124 - Distributions received from unconsolidated affiliates 23,889 89,734 6,485 Increase in deferred expenses (22,371) (16,429) (33,540) --------- ----------- ----------- Net cash provided by (used in) investing activities (379,285) (1,254,697) (1,513,147) --------- ----------- ----------- Cash flows from financing activities: Cash distributions paid to common stockholders (106,103) (82,439) (66,639) Cash distributions paid to Operating Partnership Unitholders (40,333) (38,434) (36,467) Cash distributions paid to holders of RPU's (6,091) - - Payments of dividends on PIERS (24,467) (24,467) (7,316) Proceeds of preferred stock, net of issuance costs - - 322,686 Proceeds from sale of common stock and options, net 4,674 331,056 - Proceeds from issuance of RPU's, net of issuance costs 170,625 - - Capital contributions from minority interest - - 119 Proceeds from issuance of mortgage / other notes payable 360,301 1,736,072 2,093,000 Principal payments on mortgage notes and other debt payable (282,301) (867,713) (913,229) Purchase of treasury stock - - (1,136) Increase in deferred expenses (4,858) (15,549) (2,443) --------- ----------- ----------- Net cash provided by (used in) financing activities 71,447 1,038,526 1,388,575 --------- ----------- ----------- Net change in cash and cash equivalents 1,636 5,963 (6,268) Cash and cash equivalents at beginning of year 25,593 19,630 25,898 --------- ----------- ----------- Cash and cash equivalents at end of period $ 27,229 $ 25,593 $ 19,630 ========= =========== =========== Supplemental disclosure of cash flow information: Interest paid $ 222,711 $ 197,178 $ 128,987 Interest capitalized 17,709 17,166 12,028 ========= =========== =========== Non-cash investing and financing activities: Debt assumed as consideration to seller for purchase of real estate $ - $ - $ 289,530 Treasury stock exchanged for Operating Partnership Units - - 1,875 Common stock issued in exchange for Operating Partnership Units 5,511 522 48,241 Common stock issued in exchange for GGP/Homart stock - 90,513 - Contribution of property, other assets and related debt, net to GGP/Homart II - 224,033 - Notes receivable issued for exercised stock options 7,149 380 3,164 Assumption and conversion of notes In conjunction with acquisition of property 77,657 - - Operating Partnership Units and common stock issued as consideration for purchase of real estate 215 - 163,514 Penalty on retirement of debt - 8,655 - Distributions payable 47,509 42,695 33,757
The accompanying notes are an integral part of these consolidated financial statements. F-7 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) NOTE 1 ORGANIZATION General General Growth Properties, Inc., a Delaware corporation ("General Growth"), was formed in 1986 to own and operate regional mall shopping centers. All references to the "Company" in these notes to Consolidated Financial Statements include General Growth and those entities owned or controlled by General Growth (including the Operating Partnership and the LLC as described below), unless the context indicates otherwise. On April 15, 1993, General Growth completed its initial public offering and a business combination involving entities under varying common ownership. Proceeds from the initial public offering were used to acquire a majority interest in GGP Limited Partnership (the "Operating Partnership") which was formed to succeed to substantially all of the interests in regional mall general partnerships owned and controlled by the Company and its original stockholders. The Company conducts substantially all of its business through the Operating Partnership. Effective January 1, 2000, General Growth established a Dividend Reinvestment and Stock Purchase Plan ("DRSP"). General Growth has reserved for issuance up to 1,000,000 shares of Common Stock for issuance under the DRSP. The DRSP will, in general, allow participants in the plan to make purchases of Common Stock from dividends received or additional cash investments. Although the purchase price of the Common Stock will be determined by the current market price, the purchases will be made without fees or commissions. General Growth will satisfy DRSP Common Stock purchase needs through the issuance of new shares of Common Stock or by repurchases of currently outstanding Common Stock. As of December 31, 2000 an aggregate of 25,045 shares of Common Stock have been issued under the DRSP. During July 1999, General Growth completed a public offering of 10,000,000 shares of Common Stock (the "1999 Offering"). General Growth received net proceeds of approximately $330,296 of which a portion was used to reduce outstanding loans including certain indebtedness to affiliates of the underwriter of the 1999 Offering. In addition, a portion of the proceeds of the 1999 Offering were used to fund a portion of the purchase price of Ala Moana Center (Note 3). Redeemable Preferred Stock During June 1998, General Growth completed a public offering of 13,500,000 depositary shares (the "Depositary Shares"), each representing 1/40 of a share of 7.25% Preferred Income Equity Redeemable Stock, Series A, par value $100 per share ("PIERS"). General Growth received net proceeds of approximately $322,686 which were utilized to fund certain of the acquisitions described in Note 3 and for other working capital needs. The Depositary Shares are convertible at any time, at the option of the holder, into shares of Common Stock at the conversion price of $39.70 per share of Common Stock. In addition, the PIERS have a preference on liquidation of General Growth equal to $1,000 per PIERS (equivalent to $25.00 per Depositary Share), plus accrued and unpaid dividends, if any, to the liquidation date. The PIERS and the Depositary Shares are subject to mandatory redemption by General Growth on July 15, 2008 at a price of $1,000 per PIERS, plus accrued and unpaid dividends, if F-8 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) any, to the redemption date. Accordingly, the PIERS have been reflected in the accompanying financial statements at such liquidation or redemption value. Shareholder Rights Plan In November 1998, General Growth adopted a shareholder rights plan (the "Plan"), pursuant to which General Growth declared a dividend of one preferred share purchase right (a "Right") for each outstanding share of Common Stock outstanding on December 10, 1998 to the shareholders of record on that date. Prior to becoming exercisable, the Rights trade together with the Common Stock. In general, the Rights will become exercisable if a person or group acquires or announces a tender or exchange offer for 15% or more of the Common Stock. Each Right will initially entitle the holder to purchase from General Growth one one-thousandth of a share of newly-created Series A Junior Participating Preferred Stock, par value $100 per share (the "Preferred Stock"), at an exercise price of $148 per one one-thousandth of a share, subject to adjustment. In the event that a person or group acquires 15% or more of the Common Stock, each Right will entitle the holder (other than the acquirer) to purchase shares of Common Stock (or, in certain circumstances, cash or other securities) having a market value of twice the exercise price of a Right at such time. Under certain circumstances, each Right will entitle the holder (other than the acquirer) to purchase common stock of the acquirer having a market value of twice the exercise price of a Right at such time. In addition, under certain circumstances, the Board of Directors of General Growth may exchange each Right (other than those held by the acquirer) for one share of Common Stock, subject to adjustment. The Rights expire on November 18, 2008, unless earlier redeemed by General Growth for $0.01 per Right or such expiration date is extended. Operating Partnership The Operating Partnership commenced operations on April 15, 1993 and as of December 31, 2000, it owned 100% of fifty- three regional shopping centers (the "Wholly-Owned Centers"); 50% of the stock of GGP/Homart, Inc. ("GGP/Homart"), 50% of the membership interest of GGP/Homart II, L.L.C. ("GGP/Homart II"), 51% of the stock of GGP Ivanhoe, Inc. ("GGP Ivanhoe"), 51% of the stock of GGP Ivanhoe III, Inc. ("GGP Ivanhoe III"), 50% of Quail Springs Mall and Town East Mall, (collectively, the "Unconsolidated Real Estate Affiliates"), and a 100% non- voting preferred stock interest representing 95% of the equity interest in General Growth Management, Inc. ("GGMI"). The Unconsolidated Real Estate Affiliates and GGMI comprise the "Unconsolidated Affiliates". As of such date, GGP/Homart owned interests in twenty-three shopping centers, GGP/Homart II owned interests in seven shopping centers GGP Ivanhoe owned 100% of two shopping centers, and GGP Ivanhoe III (through a wholly-owned subsidiary) owned 100% of eight shopping centers, collectively the "Unconsolidated Centers". Together, the Wholly-Owned Centers and the Unconsolidated Centers comprise the "Company Portfolio" or the "Portfolio Centers". During May 2000, the Operating Partnership formed GGPLP L.L.C., a Delaware limited liability company (the "LLC") by contributing its interest in a portfolio of 44 Wholly-Owned regional shopping centers to the LLC in exchange for all of the F-9 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) common units of membership interest in the LLC. On May 25, 2000, a total of 700,000 redeemable preferred units of membership interest in the LLC (the "RPUs") were issued to an institutional investor by the LLC, which yielded approximately $170,625 in net proceeds to the Company. The net proceeds of the sale of the RPUs were used to repay a portion of the Company's unsecured debt. Holders of the RPUs are entitled to receive cumulative preferential cash distributions per RPU (payable quarterly commencing July 15, 2000) at a per annum rate of 8.95% of the $250 liquidation preference thereof (or $5.59375 per quarter) prior to any distributions by the LLC to the Operating Partnership. Subject to certain limitations, the RPUs may be redeemed at the option of the LLC at any time on or after May 25, 2005 for cash equal to the liquidation preference amount plus accrued and unpaid distributions and may be exchanged at the option of the holders of the RPUs on or after May 25, 2010 for an equivalent amount of a newly created series of redeemable preferred stock of General Growth. Such preferred stock would provide for an equivalent 8.95% annual preferred distribution and would be redeemable at the option of General Growth for cash equal to the liquidation preference amount plus accrued and unpaid distributions. The RPUs have been reflected in the accompanying consolidated financial statements as a component of minority interest at the current total liquidation preference amount of $175,000. As of December 31, 2000, the Company owned an approximate 73% general partnership interest in the Operating Partnership (excluding its preferred units of partnership interest as discussed below). The remaining approximate 27% minority interest in the Operating Partnership is held by limited partners that include trusts for the benefit of the families of the original stockholders who initially owned and controlled the Company and subsequent contributors of properties to the Company. These minority interests are represented by common units of limited partnership interest in the Operating Partnership (the "Units"). The Units can be redeemed at the option of the holders for cash or, at General Growth's election with certain restrictions, for shares of Common Stock on a one-for-one basis. The holders of the Units also share equally with General Growth's common stockholders on a per share basis in any distributions by the Operating Partnership on the basis that one Unit is equivalent to one share of Common Stock. In connection with the issuance of the Depositary Shares and in order to enable General Growth to comply with its obligations in respect to the PIERS, the Operating Partnership Agreement was amended to provide for the issuance to General Growth of preferred units of limited partnership interest (the "Preferred Units") in the Operating Partnership which have rights, preferences and other privileges, including distribution, liquidation, conversion and redemption rights, that mirror those of the PIERS. Accordingly, the Operating Partnership is required to make all required distributions on the Preferred Units prior to any distribution of cash or assets to the holders of the Units. At December 31, 2000, 100% of the Preferred Units of the Operating Partnership (337,500) were owned by General Growth. F-10 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) Changes in outstanding Operating Partnership Units (excluding the Preferred Units) for the three years ending December 31, 2000, are as follows:
Units ----- December 31, 1997 18,763,955 Acquisition of Southwest Plaza 505,420 Acquisition of Altamonte Mall 3,683,143 Acquisition of Mall St. Vincent 111,181 Conversion to common stock (3,232,345) ---------- December 31, 1998 19,831,354 Conversion to common stock (33,162) ---------- December 31, 1999 19,798,192 ---------- Acquisition of outparcel at Greenwood Mall 7,563 Conversion to common stock (212,050) ---------- December 31, 2000 19,593,705 ==========
Business Segment Information The Financial Accounting Standards Board (the "FASB") issued Statement No. 131, "Disclosures about Segments of an Enterprise and Related Information" ("Statement 131") in June of 1997. Statement 131 requires disclosure of certain operating and financial data with respect to separate business activities within an enterprise. The sole business of General Growth and its consolidated affiliates is the owning and operation of shopping centers. General Growth evaluates operating results and allocates resources on a property-by-property basis. General Growth does not distinguish or group its consolidated operations on a geographic basis. Accordingly, General Growth has concluded it currently has a single reportable segment for Statement 131 purposes. Further, all operations are within the United States and no customer or tenant comprises more than 10% of consolidated revenues. F-11 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) NOTE 2 Principles of Consolidation SUMMARY OF The accompanying consolidated financial statements include SIGNIFICANT the accounts of the Company consisting of the fifty-three ACCOUNTING centers and the unconsolidated investments in GGP/Homart, POLICIES GGP/Homart II, GGP Ivanhoe, GGP Ivanhoe III, Quail Springs Mall, Town East Mall and GGMI. All significant intercompany balances and transactions have been eliminated. Revenue Recognition Minimum rent revenues are recognized on a straight-line basis over the term of the related leases. Overage rents are recognized on an accrual basis once tenant sales revenues exceed contractual tenant lease annual thresholds. Recoveries from tenants for taxes, insurance and other shopping center operating expenses are recognized as revenues in the period the applicable costs are incurred. (See also Note 12.) The Company provides an allowance for doubtful accounts against the portion of accounts receivable which is estimated to be uncollectible. Such allowances are reviewed periodically based upon the recovery experience of the Company. Accounts receivable in the accompanying consolidated balance sheets are shown net of an allowance for doubtful accounts of $7,665 and $7,600 as of December 31, 2000 and 1999, respectively. Cash And Cash Equivalents The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. The cash and cash equivalents of the Company are held at two financial institutions. Deferred Expenses Deferred expenses consist principally of financing fees and leasing commissions, which are amortized over the terms of the respective agreements. Deferred expenses in the accompanying consolidated balance sheets are shown at cost, net of accumulated amortization of $52,240 and $38,004 as of December 31, 2000 and 1999, respectively. Fair Value of Financial Investments Statement No. 107, Disclosure about the Fair Value of Financial Instruments, ("SFAS No. 107"), issued by the Financial Accounting Standards Board ("FASB"), requires the disclosure of the fair value of the Company's financial instruments for which it is practicable to estimate that value, whether or not such instruments are recognized in the consolidated balance sheets. SFAS No. 107 does not apply to all balance sheet items and the Company has utilized market information as available or present value techniques to estimate the SFAS No. 107 values required to be disclosed. Since such values are estimates, there can be no assurance that the SFAS No. 107 value of any financial instrument could be realized by immediate settlement of the instrument. The Company considers the carrying value of its cash and cash equivalents to approximate the SFAS No. 107 value due to the short maturity of these investments. Based on borrowing rates available to the Company at the end of 2000 for mortgage loans with similar terms and maturities, the SFAS No. 107 value of the F-12 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) mortgage notes and other debts payable approximates carrying value at December 31, 2000 and 1999. In addition, the Company estimates that the SFAS No. 107 value of its interest rate cap agreements (Note 5) at December 31, 2000 is approximately $344. The Company has no other significant financial instruments. Acquisitions Acquisitions of properties are accounted for utilizing the purchase method and, accordingly, the results of operations are included in the Company's results of operations from the respective dates of acquisition. The Company has financed the acquisitions through the date of this report through a combination of secured and unsecured debt, issuance of Operating Partnership Units and the proceeds of the public offerings of Depositary Shares and Common Stock as described in Note 1. Properties Real estate assets are stated at cost. Interest and real estate taxes incurred during construction periods are capitalized and amortized on the same basis as the related assets. The real estate assets of the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. A real estate asset is considered to be impaired when the estimated future undiscounted operating income is less than its carrying value. To the extent an impairment has occurred, the excess of carrying value of the asset over its estimated fair value will be charged to income. Depreciation expense is computed using the straight-line method based upon the following estimated useful lives:
Years ----- Buildings and improvements......................... 40 Equipment and fixtures............................. 10
Construction allowances paid to tenants are capitalized and depreciated over the average lease term. Maintenance and repairs are charged to expense when incurred. Expenditures for significant betterments and improvements are capitalized. Investments In Unconsolidated Affiliates The Company accounts for its investments in unconsolidated affiliates using the equity method whereby the cost of an investment is adjusted for the Company's share of equity in net income or loss from the date of acquisition and reduced by distributions received. The Company generally shares in the profit and losses, cash flows and other matters relating to its unconsolidated affiliates in accordance with its respective ownership percentages. However, due to currently unpaid and accrued preferences on the GGMI preferred stock as described in Note 4, the Company was entitled to 100% of the earnings (loss) and cash flows generated by GGMI in 2000, 1999 and 1998. In addition, differences between the Company's carrying value of its investment in the unconsolidated affiliates and the Company's share of the underlying equity of such unconsolidated affiliates are amortized over the respective lives of the unconsolidated affiliates. F-13 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) Income Taxes General Growth elected to be taxed as a real estate investment trust under sections 856-860 of the Internal Revenue Code of 1986 (the "Code"), commencing with its taxable year beginning January 1, 1993. In order to qualify as a real estate investment trust, General Growth is required to distribute at least 95% (90% in 2001 and subsequent years) of its ordinary taxable income and 100% of capital gains to stockholders and to meet certain asset and income tests as well as certain other requirements. As a real estate investment trust, General Growth will generally not be liable for Federal income taxes, provided it satisfies the necessary requirements. Accordingly, the consolidated statements of operations do not reflect a provision for income taxes. State income taxes are not significant. One of the Company's affiliates, GGMI, is a taxable corporation and accordingly, state and Federal income taxes on its net taxable income are payable by GGMI. Earnings Per Share ("EPS") Basic per share amounts are based on the weighted average of common shares outstanding of 52,058,320 for 2000, 45,940,104 for 1999 and 36,190,367 for 1998. Diluted per share amounts are based on the total number of weighted average common shares and dilutive securities (stock options) outstanding of 52,096,331 for 2000, 46,030,559 for 1999, and 36,381,914 for 1998. The effect of the issuance of the PIERS is anti- dilutive with respect to the Company's calculation of diluted earnings per share for the year ended December 31, 2000, 1999 and 1998 and therefore has been excluded. However, certain options outstanding were not included in the computation of diluted earnings per share either because the exercise price of the options was higher than the average market price of the Common Stock for the applicable periods and therefore, the effect would be anti-dilutive or because the conditions which must be satisfied prior to the issuance of any such shares were not achieved during the applicable periods. The outstanding Units have been excluded from the diluted earnings per share calculation as there would be no effect on the EPS amounts since the minority interests' share of income would also be added back to net income. F-14 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) The following are the reconciliations of the numerators and denominators of the basic and diluted EPS:
Year ended December 31, ---------------------------- 2000 1999 1998 -------- -------- -------- Numerators: Income before extraordinary items $137,948 $114,921 $ 71,194 Dividends on PIERS (24,467) (24,467) (13,433) -------- -------- -------- Income available to common stockholders before extraordinary items - for basic and diluted EPS $113,481 90,454 $ 57,761 Extraordinary items - (13,796) (4,749) -------- -------- -------- Net income available to common stockholders - for basic and diluted EPS $113,481 $ 76,658 $ 53,012 ======== ======== ======== Denominators: Weighted average common shares outstanding (in thousands) - for basic EPS 52,058 45,940 36,190 Effect of dilutive securities - options 38 91 192 -------- -------- -------- Weighted average common shares outstanding (in thousands) - for diluted EPS 52,096 46,031 36,382 ======== ======== ========
Minority Interest Income before minority interest is allocated to the limited partners (the "Minority Interest") based on their ownership percentage of the Operating Partnership. The ownership percentage is determined by dividing the numbers of Operating Partnership Units held by the Minority Interest by the total Operating Partnership Units (excluding Preferred Units) outstanding. The issuance of additional shares of Common Stock or Operating Partnership Units changes the percentage ownership of both the Minority Interest and the Company. Since a Unit is generally redeemable for cash or Common Stock at the option of the Company, it may be deemed to be equivalent to a common share. Therefore, such transactions are treated as capital transactions and result in an allocation between stockholders' equity and Minority Interest in the accompanying balance sheets to account for the change in the ownership of the underlying equity in the Operating Partnership. Comprehensive Income Statement of Financial Accounting Standards No. 130 "Reporting Comprehensive Income" requires that the Company disclose comprehensive income in addition to net income. Comprehensive income is a more inclusive financial reporting methodology that encompasses net income and all other changes in equity except those resulting from investments by and distributions to equity holders. Included in comprehensive income but not net income is unrealized holding gains or losses on marketable securities classified as available-for-sale. Although General Growth and its F-15 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) consolidated affiliates do not have any available-for-sale securities, one of its unconsolidated affiliates received common stock of Simon Property Group, Inc. as part of a 1998 transaction. Unrealized holding gains or losses on such securities through December 31, 1998 were not significant and were not reflected. However, during 1999 the Company reduced its carrying amount for its investment in such unconsolidated affiliate by $2,436 and reflected $1,714 as other comprehensive loss, net of minority interest of $722, as its equity in such unconsolidated affiliate's cumulative unrealized holding loss on such securities. For the year ended December 31, 2000 there were holding gains on such securities of $177, net of minority interest of $67 which were recorded. Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Reclassifications The consolidated financial statements for prior periods have been reclassified to conform with current classifications with no effect on results of operations. NOTE 3 PROPERTY Wholly-Owned Properties ACQUISITIONS 2000 AND DEVELOPMENTS During September 1999, St. Cloud Funding, L.L.C., a wholly- owned subsidiary of the Operating Partnership ("St. Cloud Funding"), agreed to advance approximately $31,000 to an unaffiliated developer in the form of a second mortgage loan (bearing interest at 15% per annum) collateralized by such developer's ownership interest in Crossroads Center in St. Cloud (Minneapolis), Minnesota. Contemporaneously with the loan, St. Cloud Mall L.L.C., all of the interests of which are owned by the Company ("St. Cloud Mall"), was granted an option to acquire the property in 2002. The loan had a scheduled maturity of June 1, 2004 which was accelerated in February 2000 to April 28, 2000. In conjunction with the maturity date modification, a put option agreement was executed which would permit the borrower (after March 15, 2000) to require St. Cloud Mall to purchase the property. In addition, St. Cloud Mall's purchase option was advanced to April 2000. On March 15, 2000, the borrower notified St. Cloud Mall of the exercise of the put option. Pursuant to the put option agreement, on April 26, 2000, St. Cloud Mall purchased the property at a price equal to approximately $2,000 plus the then outstanding balances of the first mortgage (approximately $46,600) and St. Cloud Funding's second mortgage. 1999 On January 11, 1999, the Company acquired a 100% ownership interest in The Crossroads Mall in Kalamazoo, Michigan. The aggregate purchase price was approximately $68,000 (subject to pro-rations and certain adjustments), which was F-16 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) funded initially from a new $83,655 short-term floating rate interim loan. In May 1999, a new $45,000 ten-year non- recourse mortgage loan collateralized by the property was obtained. On July 30, 1999, the Company acquired a 100% ownership interest in the Ala Moana Center in Honolulu, Hawaii. The price paid to the seller was $810,000 (before closing adjustments, including a credit for the cost to complete an ongoing expansion project), and was funded with the proceeds of a short-term first mortgage loan of approximately $438,000 and approximately $294,000 in cash including a portion of the net proceeds from the 1999 Offering. The short-term floating rate loan was fully repaid on August 26,1999 with the proceeds of the issuance of commercial mortgage-backed securities. On October 28, 1999, the Company acquired Baybrook Mall in Houston, Texas. The aggregate consideration paid by the Company was approximately $133,000 (subject to pro-rations and certain adjustments), which was paid in cash (raised primarily through new long-term financing on other previously unsecured properties), and a new 10-year $95,000 non-recourse loan. 1998 On April 2, 1998, the Company acquired Southwest Plaza located in Denver, Colorado. On May 8, 1998, the Company completed the acquisition of Northbrook Court Shopping Center located in Northbrook (Chicago), Illinois. The aggregate purchase price for Southwest Plaza and Northbrook Court was approximately $261,000, including approximately $149,000 of assumed debt. The Company contributed Northbrook Court to GGP/Homart II in November 1999 as described in Note 4. On June 2, 1998, the Company acquired the U.S. retail property portfolio (the "MEPC Portfolio") of MEPC plc, a United Kingdom based real estate company ("MEPC"), through the purchase of the stock of the three U.S. subsidiaries of MEPC ("MEPC U.S. Subsidiaries") that directly or indirectly owned the MEPC Portfolio. The Company acquired the MEPC Portfolio for approximately $871,000 (less certain adjustments for tenant allowances, construction costs, MEPC U.S. Subsidiary liabilities and other items). The Company borrowed approximately $830,000 to finance the purchase price for the stock, which was paid in cash at closing as more fully described in Note 5. The MEPC Portfolio consists of eight enclosed mall shopping centers: Apache Mall in Rochester, Minnesota; The Boulevard Mall in Las Vegas, Nevada; Cumberland Mall in Atlanta, Georgia; McCreless Mall in San Antonio, Texas; Northridge Fashion Center in Northridge (Los Angeles), California; Regency Square Mall in Jacksonville, Florida; Riverlands Shopping Center in LaPlace, Louisiana and Valley Plaza Mall in Bakersfield, California. On July 21, 1998, the Company acquired Altamonte Mall in Altamonte Springs (Orlando), Florida. The aggregate consideration paid for Altamonte Mall was $169,000 (subject to prorations and certain adjustments), part of which was paid by the payoff of approximately $24,000 of indebtedness assumed at acquisition with cash F-17 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) borrowed under the Company's line of credit facility (the "Credit Facility") as described in Note 5, and the balance of which was paid by the issuance of 3,683,143 Units. The Company contributed Altamonte Mall to GGP/Homart II in November, 1999 as described in Note 4. On September 3, 1998, the Company acquired Pierre Bossier Mall in Bossier City (Shreveport), Louisiana. The aggregate consideration paid for Pierre Bossier Mall was approximately $52,700 (subject to prorations and certain adjustments) which was paid in the form of approximately $10,000 in cash (borrowed under the Company's Credit Facility), a new mortgage loan (obtained from an independent third party) of approximately $42,000 and the assumption of approximately $700 of existing debt. The Company had previously loaned the sellers approximately $50,000 in early 1999 and received an option to buy the property. In conjunction with the closing of the sale, the loan was fully repaid. On September 15, 1998, the Company acquired Spring Hill Mall in West Dundee (Chicago), Illinois. The aggregate consideration paid by the Company was approximately $124,000 (subject to prorations and certain adjustments) which was paid in the form of approximately $32,000 in cash (borrowed under the Company's Credit Facility) and a new ten year fixed rate $92,000 mortgage loan. On September 18, 1998, the Company acquired Coastland Center in Naples, Florida, for approximately $114,500 in cash (subject to prorations and certain adjustments). The aggregate consideration paid was borrowed under the Company's Credit Facility. On October 21, 1998, the Company acquired Mall St. Vincent in Shreveport, Louisiana. The aggregate consideration paid for Mall St. Vincent was $26,400 (subject to prorations and certain adjustments) which was paid by issuing 200,052 Units, of which 88,871 were immediately redeemed for cash (borrowed under the Company's Credit Facility) upon demand of the holders of such Units, and by assuming approximately $19,200 of mortgage debt. Developments During the three year period ending December 31, 2000, the Company was developing or had completed construction at the following three development sites: Coralville (Iowa City), Iowa; Grandville (Grand Rapids), Michigan and Frisco (Dallas), Texas. Coral Ridge Mall, located in Coralville (Iowa City), Iowa was completed and opened in July 1998. Construction of the Grandville (Grand Rapids) mall (RiverTown Crossings) commenced in December 1997, and opened in November 1999. Construction of Stonebriar Centre, currently owned by GGP/Homart II, located in Frisco (Dallas), Texas commenced in October of 1999 and opened in August of 2000. The Company has an ongoing program of renovations and expansions at its properties including significant projects currently under construction at the Park Mall in Tuscon, Arizona; Eden Prairie Mall in Eden Prairie (Minneapolis), Minnesota; and Knollwood Mall in St. Louis Park (Minneapolis), Minnesota. In addition, the Company has commenced construction of an integrated broadband distribution system that will F-18 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) provide tenants at its properties with a private wide-area network as well as supporting applications and equipment (the "Broadband System"). The Company has already incurred the majority of these network costs (financed or to be financed by fixed-rate intermediate term equipment financing) and anticipates having the majority of its regional shopping centers wired for such broadband connectivity by the end of the second quarter of 2001. During 1999, the Company formed a joint venture to develop a regional mall in Westlake (Dallas), Texas. As of December 31, 2000, the Company had invested approximately $14,460 in the joint venture. The Company is currently obligated to fund pre-development costs (estimated to be approximately $1,545, most of which has been incurred). Actual development costs are not resolved at this time. The retail site, part of a planned community which is expected to contain a resort hotel, a golf course, luxury homes and corporate offices, is currently planned to contain up to 1.6 million square feet of tenant space including up to six anchor stores and a multi-screen theater. There can be no assurance that development of this site will proceed beyond the pre- development phase. The Company also owns and is investigating certain other potential development sites, including sites in Toledo, Ohio and West Des Moines, Iowa but there can be no assurance that development of these sites will proceed. NOTE 4 GGP/Homart INVESTMENTS IN The Company owns 50% of GGP/Homart with the remaining UNCONSOLIDATED ownership interest held by the New York State Common AFFILIATES Retirement Fund, an institutional investor. GGP/Homart has elected to be taxed as a REIT. The Company's co-investor in GGP/Homart has an exchange right under the GGP/Homart Stockholders Agreement, which permits it to convert its ownership interest in GGP/Homart to shares of Common Stock of General Growth. If such exchange right is exercised, the Company may alternatively satisfy such exchange in cash. In early 1999, the Company received notice that an institutional investor (which then owned an approximate 4.7% interest in GGP/Homart) desired to exercise its exchange right. The Company satisfied the exercise of such exchange right (effective as of January 1, 1999) by issuing 1,052,182 shares of Common Stock, thereby increasing its ownership interest in GGP/Homart from approximately 38.2% in 1998 to approximately 42.9% for the first quarter of 1999. During the second quarter of 1999, two other co-investors (which then owned in the aggregate an approximate 7.1% interest in GGP/Homart) notified the Company that they desired to exercise their exchange rights. The Company satisfied the exercise of such exchange rights (effective as of April 1, 1999) by issuing an aggregate of 1,551,109 shares of Common Stock, thereby increasing its ownership interest in GGP/Homart to 50%. GGP/Homart II In November 1999, the Company, together with New York State Common Retirement Fund, the Company's co-investor in GGP/Homart, formed GGP/Homart II, a Delaware limited liability company which is owned equally. GGP/Homart II owns F-19 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) 100% interests in Stonebriar Centre in Frisco (Dallas), Texas, Altamonte Mall in Altamonte Springs (Orlando), Florida, Natick Mall in Natick (Boston), Massachusetts and Northbrook Court in Northbrook (Chicago), Illinois which were contributed by the Company; and 100% interests in Alderwood Mall in Lynnwood (Seattle), Washington; Carolina Place in Charlotte, North Carolina; and Montclair Plaza in Los Angeles, California which were contributed by the New York State Common Retirement Fund. Certain of the malls were contributed subject to existing financing in order to balance the net equity values of the malls contributed by each of the venture partners. According to the membership agreement between the venture partners, the Company and its joint venture partner share in the profits and losses, cash flows and other matters relating to GGP/Homart II in accordance with their respective ownership percentages. GGP Ivanhoe III On July 23, 1998, effective as of June 30, 1998, GGP Ivanhoe III acquired the U.S. Prime Property, Inc. ("USPPI") portfolio through a merger of a wholly-owned subsidiary of GGP Ivanhoe III into USPPI. The common stock of GGP Ivanhoe III is owned 51% by the Company and 49% by an affiliate of Ivanhoe Inc. of Montreal, Quebec, Canada ("Ivanhoe"). GGP Ivanhoe III has elected to be taxed as a REIT. The aggregate consideration paid pursuant to the merger agreement was approximately $625,000 (less certain adjustments, including a credit of approximately $64,000 for outstanding mortgage indebtedness and accrued interest thereon and other miscellaneous items). The acquisition was financed with a $392,000 acquisition loan bearing interest at LIBOR plus 90 basis points which became due July 1, 1999, (subsequently extended and repaid in September 1999 as described below) and capital contributions from the Company and the "joint venture partner" in proportion to their respective stock ownership. Pursuant to the GGP Ivanhoe III stockholders' agreement, the Company initially contributed approximately $91,290 to GGP Ivanhoe III (less certain interest and other credits). The Company's capital contributions were funded primarily with borrowing under the Company's Credit Facility. The properties acquired include: Landmark Mall in Alexandria, Virginia; Mayfair Mall and adjacent office buildings in Wauwatosa (Milwaukee), Wisconsin; Meadows Mall in Las Vegas, Nevada; Northgate Mall in Chattanooga, Tennessee; Oglethorpe Mall in Savannah, Georgia; and Park City Center in Lancaster, Pennsylvania. Effective as of September 28, 1999, GGP Ivanhoe III acquired, through its wholly-owned subsidiary, Oak View Mall in Omaha, Nebraska from an unrelated third party. In addition, on December 22, 1999, GGP Ivanhoe III acquired Eastridge Shopping Center in San Jose, California. The aggregate purchase price for the two properties was approximately $160,000. A portion of the purchase price was financed with an $83,000 ten-year mortgage loan, collateralized by the Oak View Mall which bears interest at 7.71% per annum (and requires monthly payments of principal and interest based upon a 30-year amortization schedule). The remainder of the purchase price was funded by capital contributions from the Company and Ivanhoe in proportion to their respective stock ownership in GGP Ivanhoe III and short-term loans of approximately $30,000 bearing interest at LIBOR (6.56% at December 31, 2000) plus 185 basis F-20 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) points and maturing in June 2001. The Company's capital contributions were funded primarily from proceeds from the Company's Credit Facility. On September 30, 1999, GGP Ivanhoe III repaid the $392,000 acquisition loan with its allocated portion of the proceeds of the issuance of commercial mortgage-backed securities as described in Note 5 and capital contributions of approximately $26,000 and $25,000 from each of the Company and Ivanhoe, respectively. In conjunction with the repayment, GGP Ivanhoe III expensed previously unamortized deferred financing costs, the Company's share of which (approximately $1,799) has been reflected as an extraordinary item for the year ended December 31, 1999. The joint venture partner in GGP Ivanhoe III is also the Company's joint venture partner in GGP Ivanhoe (described below). The Company and Ivanhoe share in the profits and losses, cash flows and other matters relating to GGP Ivanhoe III in accordance with their respective ownership percentages except that certain major operating and capital decisions (as defined in the stockholders' agreement) require the approval of both stockholders. Accordingly, the Company is accounting for GGP Ivanhoe III using the equity method. GGP Ivanhoe GGP Ivanhoe owns The Oaks Mall in Gainesville, Florida and Westroads Mall in Omaha, Nebraska. The Company contributed approximately $43,700 for its 51% ownership interest in GGP Ivanhoe and Ivanhoe owns the remaining 49% ownership interest. The terms of the stockholders' agreement are similar to those of GGP Ivanhoe III. Town East Mall / Quail Springs Mall The Company owns a 50% interest in Town East Mall, located in Mesquite, Texas and a 50% interest in Quail Springs Mall in Oklahoma City, Oklahoma. The Company shares in the profits and losses, cash flows and other matters relating to Town East Mall and Quail Springs Mall in accordance with its ownership percentage. GGMI At December 31, 2000, the Operating Partnership owned all of the non-voting preferred stock of GGMI representing 95% of the equity interest. Certain key current and former employees of the Company held the remaining 5% equity interest through ownership of 100% of the common stock of GGMI, which was entitled to all voting rights in GGMI. Accordingly, the Company utilized the equity method to account for its ownership interest in GGMI. As no preferred stock dividends had been paid by GGMI, the Company had been allocated 100% of the earnings (loss) and cash flows generated by GGMI since 1996. The Operating Partnership also had advanced funds to GGMI, at interest rates ranging from 8% to 14% per annum, which were scheduled to mature by 2016. The loans required payment of interest only until maturity. GGMI manages, leases, and performs various other services for the Portfolio Centers and other properties owned by unaffiliated third parties. F-21 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) On January 1, 2001 the Company acquired 100% of the common stock of GGMI. In connection with the acquisition, the GGMI preferred stock owned by the Company was cancelled and approximately $40,000 of the outstanding loans owed by GGMI to the Company were contributed to the capital of GGMI. In addition, the Company and GGMI concurrently terminated the management contracts for the Wholly-Owned Centers as the management activities will be performed directly by the Company. The operations of GGMI will be fully consolidated with the Company but GGMI will continue to manage, lease, and perform various other services for the Unconsolidated Centers and other properties owned by unaffiliated third parties. During 2001, the Company will elect for GGMI to be treated as a taxable REIT subsidiary (a "TRS") as permitted by the Tax Relief Extension Act of 1999. F-22 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) SUMMARIZED FINANCIAL INFORMATION OF INVESTMENTS IN UNCONSOLIDATED REAL ESTATE AFFILIATES Following is summarized financial information for the Company's Unconsolidated Real Estate Affiliates as of December 31, 2000 and 1999 and for the years ended December 31, 2000, 1999 and 1998. CONDENSED BALANCE SHEETS
December 31, 2000 All Other Real Estate GGP/Homart GGP/Homart II Affiliates ---------- ------------- ----------- Assets: Net investment in real estate $1,437,600 $1,240,709 $1,164,122 Investment in real estate joint ventures 49,563 - - Other assets 116,242 80,866 69,362 ---------- ---------- ---------- $1,603,405 $1,321,575 $1,233,484 ========== ========== ========== Liabilities and Owners' Equity: Mortgage and other notes payable $1,134,346 $ 621,924 $ 728,343 Accounts payable and accrued expenses 38,712 38,018 49,195 Owners' equity 430,347 661,633 $ 455,946 ---------- ---------- ---------- $1,603,405 $1,321,575 $1,233,484 ========== ========== ==========
December 31, 1999 All Other Real Estate GGP/Homart GGP/Homart II Affiliates ---------- ------------- ----------- Assets: Net investment in real estate $1,225,379 $1,178,202 $1,145,385 Investment in real estate joint ventures 110,540 - - Other assets 116,817 293,721 51,826 ---------- ---------- ---------- $1,452,736 $1,471,923 $1,197,211 ========== ========== ========== Liabilities and Owners' Equity: Mortgage and other notes payable $ 945,553 $ 641,850 $ 733,935 Accounts payable and accrued expense 37,941 41,886 36,733 Owners' equity 469,242 788,187 426,543 ---------- ---------- ---------- $1,452,736 $1,471,923 $1,197,211 ========== ========== ==========
CONDENSED STATEMENTS OF OPERATIONS
December 31, 2000 All Other Real Estate GGP/Homart GGP/Homart II Affiliates ---------- ------------- ----------- Revenues: Tenant rents $254,275 $146,730 $199,709 Operating expenses (1) 146,138 81,678 117,266 -------- -------- -------- Operating Income (loss) 108,137 65,052 82,443 Interest expense, net (2) (73,098) (34,914) (53,128) Equity in net income of unconsolidated real estate affiliates 4,333 - - Gain on property sales (1,811) - - Income allocated to minority interest (408) - - -------- -------- -------- Net Income (loss) $ 37,153 $ 30,138 $ 29,315 ======== ======== ========
F-23 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts)
December 31, 1999 All Other Real Estate GGP/Homart GGP/Homart II Affiliates ---------- ------------- ----------- Revenues: Tenant rents $224,599 $12,535 $163,445 Operating expenses (1) 129,465 6,590 $ 93,699 -------- ------- -------- Operating Income (loss) 95,134 5,945 69,746 Interest expense, net (2) (60,814) (1,758) (45,624) Equity in net income of unconsolidated real estate affiliates 5,504 - - Gain on property sales 816 - Extraordinary Item (3,528) Income allocated to minority interest (808) - - -------- ------- -------- Net Income (loss) $ 39,832 $ 4,187 $ 20,594 ======== ======= ======== December 31, 1998 All Other Real Estate GGP/Homart GGP/Homart II Affiliates ---------- ------------- ----------- Revenues: Tenant rents $184,783 $ - $103,803 Operating expenses (1) 107,717 - 54,530 -------- ------- -------- Operating Income (loss) 77,066 - 49,273 Interest expense, net (2) (47,799) (29,882) Equity in net income of unconsolidated real estate affiliates 5,011 - - Gain on property sales 13,182 - - Income allocated to minority interest (705) - - -------- ------- -------- Net Income (loss) $ 46,755 $ - $ 19,391 ======== ======= ========
Significant accounting policies used by the Unconsolidated Real Estate Affiliates are the same as those used by the Company. -------- (1) Includes depreciation and amortization. (2) Includes extraordinary items. F-24 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) NOTE 5 MORTGAGE Mortgage notes and other debts payable at December 31, 2000 NOTES AND OTHER and 1999 consisted of the following: DEBTS PAYABLE
December 31, 2000 1999 ---------- ---------- Fixed-Rate debt Mortgage and other notes payable $1,832,783 $1,724,854 Variable-Rate debt Mortgage notes payable 1,146,343 1,234,680 Credit Facility and bank loans 265,000 160,000 ---------- ---------- Total Variable-Rate debt 1,411,343 1,394,680 ---------- ---------- Total $3,244,126 $3,119,534 ========== ==========
FIXED RATE DEBT Mortgage Notes Payable The fixed-rate mortgage notes bear interest ranging from 6.41% to 10.00% per annum (weighted average of 7.01% per annum), require monthly payments of principal and/or interest and have various maturity dates through 2020 (weighted average remaining term of 5.0 years). Certain properties are pledged as collateral for the related mortgage notes. The mortgage notes payable as of December 31, 2000 are non-recourse to the Company (except to the extent of supplemental guarantees executed by the Company). Certain loans have cross-default provisions and are cross- collateralized as part of a group of properties. Under certain cross-default provisions, a default under any mortgage notes included in a cross-defaulted package may constitute a default under all such mortgage notes and may lead to acceleration of the indebtedness due on each property within the collateral package. In general, the cross-defaulted properties are under common ownership. However, GGP Ivanhoe debt collateralized by two GGP Ivanhoe centers totaling $125,000 is cross-defaulted and cross- collateralized with debt collateralized by eleven Wholly- Owned centers. GGP Ivanhoe III debt collateralized by five GGP Ivanhoe III centers totaling $341,019 is cross-defaulted and cross-collateralized with debt collateralized by four Wholly-Owned Centers. VARIABLE RATE DEBT Mortgage Notes Payable Variable mortgage notes payable at December 31, 2000 consist primarily of the approximate $110,000 outstanding on the construction loan collateralized by Rivertown Crossings as described below, approximately $130,000 of non-recourse financing collateralized by a pool of six Wholly-Owned properties and approximately $856,350 of collateralized mortgage-backed securities as described below. The loans bear interest at a rate per annum equal to LIBOR plus 90 to 250 basis points. Commercial Mortgage-Backed Securities In August 1999, the Company issued $500,000 of commercial mortgage-backed securities, collateralized by the Ala Moana Center (see Note 3), with a maturity date of September 10, 2004 assuming the exercise by the Company of no-cost extension F-25 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) options aggregating two years. The securities (the "Ala Moana CMBS") are comprised of notes which bear interest at rates per annum ranging from LIBOR plus 50 basis points to LIBOR plus 275 basis points (weighted average equal to LIBOR plus 95 basis points), calculated and payable monthly. In conjunction with the issuance of the Ala Moana CMBS, the Company arranged for an interest rate cap agreement, the effect of which will limit the maximum interest rate the Company will be required to pay on the securities to 9% per annum. Payments received pursuant to the interest rate cap agreement for the year ended December 31, 2000 were approximately $77, which were reflected as a reduction in net interest expense. Approximately $438,000 of the proceeds from the sale of the Ala Moana CMBS was used by the Company to repay the short-term mortgage loan obtained in July, 1999 to enable it to purchase the Ala Moana Center. The remainder was utilized by the Company for general working capital purposes including paydowns on the Company's Credit Facility. In September 1999, the Company issued $700,229 of commercial mortgage backed securities with a maturity date of October 10, 2004, assuming the exercise of no-cost extension options aggregating two years, cross-collateralized and cross- defaulted by a portfolio of nine regional malls and an office complex adjacent to one of the regional malls. The properties in the portfolio are Mayfair Mall and adjacent office buildings in Wauwatosa (Milwaukee), Wisconsin; Park City Center in Lancaster, Pennsylvania; Oglethorpe Mall in Savannah, Georgia; Landmark Mall in Alexandria, Virginia, all centers owned by GGP Ivanhoe III; and Northgate Mall in Chattanooga, Tennessee; The Boulevard Mall in Las Vegas, Nevada; Regency Square Mall in Jacksonville, Florida; Valley Plaza Shopping Center in Bakersfield, California; Northridge Fashion Center in Northridge (Los Angeles), California, all Wholly-Owned Centers. The securities (the "GGP-Ivanhoe CMBS") are comprised of notes which bear interest at rates per annum ranging from LIBOR plus 52 basis points to LIBOR plus 325 basis points (weighted average equal to LIBOR plus approximately 109 basis points), calculated and payable monthly. In conjunction with the issuance of the GGP-Ivanhoe CMBS, the Company arranged for an interest rate cap agreement, the effect of which will limit the maximum interest rate the Company will be required to pay on the securities to 9.03% per annum. Payments received pursuant to the interest rate cap agreement for the year ended December 31, 2000 were approximately $366, which were reflected as a reduction in net interest expense. Approximately $340,000 of the proceeds from the sale of the GGP-Ivanhoe CMBS repaid amounts collateralized by the GGP Ivanhoe III properties in the GGP-Ivanhoe CMBS Portfolio of properties and the remaining approximately $360,000 repaid amounts collateralized by Wholly-Owned properties in the GGP-Ivanhoe CMBS portfolio of properties. Credit Facility The Company's $200,000 unsecured revolving Credit Facility was originally scheduled to mature on July 31, 2000. On June 23, 2000, the Company prepaid all remaining outstanding principal amounts and terminated the Credit Facility. The Credit Facility bore interest at a floating rate per annum equal to LIBOR plus 80 to 120 basis points depending upon the Company's leverage ratio. The Credit Facility F-26 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) was subject to financial performance covenants including debt-to-market capitalization, minimum earnings before interest, taxes, depreciation and amortization ("EBITDA") ratios and minimum equity values. As of July 31, 2000 the Company obtained a new unsecured revolving credit facility (the "Revolver") in a maximum aggregate principal amount of $135,000 (increased to $160,000 in September 2000). At December 31, 2000 the outstanding balance of the Revolver was $35,000. The Revolver has a maturity of July 31, 2003 and bears interest at a floating rate per annum equal to LIBOR plus 100 to 190 basis points, depending on the Company's average leverage ratio. The Revolver is subject to financial performance covenants including debt to value and net worth ratios, EBITDA ratios and minimum equity values. Interim Financing In January 1999, the Company obtained an additional $30,000 unsecured bank loan, which bore interest at a floating market rate (average rate equal to 6.46% per annum). The Company had obtained in November 1998 a thirteen-month loan in the principal amount of $55,000 collateralized by a negative pledge (i.e., the promise not to encumber) of Coastland Center in Naples, Florida. These loans were repaid on May 21, 1999 with a ten-year 7.0% mortgage loan in the principal amount of $87,000 collateralized by Coastland Center. In January 1999, the Company obtained an additional $83,655 floating rate (7.27% at September 30, 1999) interim loan (originally scheduled to mature June 1, 1999) which was expected to be replaced or refinanced by the maturity date with new mortgage financing. During May, 1999, the Company obtained a new $45,000 mortgage loan collateralized by The Crossroads Mall in Kalamazoo, Michigan. The loan, which bears interest at 7.40% and matures on June 1, 2009, partially repaid the interim loan and the maturity of the remaining balance, approximately $38,655 at June 30, 1999, was extended and repaid in October 1999 with a portion of the proceeds of the six property two-year non-recourse mortgage pool financing described below. In April 1999, the Company obtained an additional $25,000 bank loan, partially secured by Park Mall in Tucson, Arizona. In October 1999, the loan was increased to $50,000. The loan matures November 15, 2002 as extended, bears interest at a rate per annum of LIBOR plus 175 basis points and is expected to be further extended and then replaced by maturity with a $90,000 construction loan facility to be collateralized by Park Mall which is currently undergoing extensive renovation, with the final phase of renovation expected to be completed in 2001. On July 30, 1999, the Company obtained a three month loan in the principal amount of $25,000, collateralized by a negative pledge (i.e., the promise not to encumber) of Eagle Ridge Mall in Lake Wales, Florida. The proceeds of the loan were distributed to the Operating Partnership to fund ongoing acquisition and development activity. The short-term loan bore interest at a rate per annum of LIBOR plus 175 basis points. This loan was refinanced in October 1999 with a portion of the proceeds of the six-property two-year non- recourse mortgage pool financing described below. F-27 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) In September 1999, the Company obtained an additional $95,000 unsecured floating rate (LIBOR plus 250 basis points) interim loan which was scheduled to mature July 31, 2000. The loan provided for periodic principal payments ($12,000 paid in 1999) to maturity and the majority of the proceeds of this loan were used to repay the remaining balance on the MEPC Acquisition Financing. This loan was repaid in January 2000 as described below. In October 1999, the Company obtained a $130,000 two-year loan collateralized by six properties, five regional malls (Knollwood Mall, Eagle Ridge Mall, West Valley Mall, South Shore Mall and Century Mall) and the Company's headquarters, the 110 N. Wacker Drive office building in Chicago, Illinois. This loan bears interest at LIBOR plus 185 basis points and matures on November 1, 2001. The Company intends to replace this loan on or before maturity with non-recourse long-term mortgage financing. In January 2000, the Company obtained a new $200,000 unsecured short-term bank loan. The Company's initial draw under this loan was $120,000 in January, 2000 and the remaining available amounts were fully drawn at June 30, 2000. Loan proceeds were used to fund ongoing redevelopment projects and repay the remaining balance of $83,000 on an interim loan obtained in September 1999. The bank loan bore interest at a rate per annum of LIBOR plus 150 basis points and was refinanced on August 1, 2000 with the Revolver and the Term Loan described below. As of July 31, 2000, the Company obtained an unsecured term loan (the "Term Loan") in a maximum principal amount of $100,000. The principal amount of the Term Loan was increased to $155,000 in September, 2000. Term Loan proceeds were used to fund ongoing redevelopment projects and repay a portion of the remaining balance of the bank loan described in the prior paragraph immediately above. During the fourth quarter of 2000, the principal amount of the Term Loan was further increased to $230,000. The additional $75,000 was used to pay down the Revolver as discussed above and for current redevelopment projects. The Term Loan has a maturity of July 31, 2003 and bears interest at a rate per annum of LIBOR plus 100 to 170 basis points depending on the Company's average leverage ratio. Construction Loan During April 1999 the Company received $30,000 representing the initial loan draw on an $110,000 construction loan facility. The facility is collateralized by and provided financing for the RiverTown Crossings Mall development (including outparcel development) in Grandville (Grand Rapids), Michigan. The construction loan provides for periodic funding as construction and leasing continue and currently bears interest at a rate per annum of LIBOR plus 150 basis points. As of July 17, 2000 additional loan draws of approximately $80,000 had been made and no further amounts are available under the construction loan facility. Interest is due monthly but during 1999 was added to the periodic loan draws. The loan matures on June 29, 2001 and the Company currently intends to refinance the loan at or prior to maturity with a non-recourse long-term mortgage loan. F-28 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) Letters of Credit As of December 31, 2000 and 1999, the Operating Partnership had outstanding letters of credit of $7,693 and $7,934, respectively, primarily in connection with special real estate assessments and insurance requirements. In addition, the Company has a letter of credit of approximately $11,200 related to the funding of the Ala Moana CMBS and pending construction projects at the Ala Moana Center. Principal amounts due under mortgage notes and other debts payable mature as follows:
Amount Year Maturing ---- ---------- 2001 $407,736 2002 111,254 2003 282,344 2004 1,112,189 2005 40,894 Subsequent 1,289,709 ---------- Total $3,244,126 ==========
Certain mortgage notes payable may be prepaid but are generally subject to a prepayment penalty of a yield- maintenance premium or a percentage of the loan balance. Land, buildings and equipment related to the mortgage notes payable with an aggregate cost of approximately $4,599,615 at December 31, 2000 have been pledged as collateral. In addition, loans totaling approximately $386,540 (collateralized by assets with a total carrying value of approximately $477,389) were supplementally guaranteed by the Company. Certain properties, including those within the portfolios collateralized by commercial mortgage backed securities, are subject to financial performance convenants, primarily EBITDA ratios. NOTE 6 The extraordinary items resulted from prepayment costs and EXTRAORDINARY unamortized deferred financing costs related to the early ITEMS extinguishment, primarily through refinancings, of mortgage notes payable. In 1999, the basic and diluted per share impact of the extraordinary items was $.30. The basic per share impact of the extraordinary items in 1998 was $.14, and the diluted per share impact was $.13. NOTE 7 RENTALS The Company receives rental income from the leasing of UNDER OPERATING retail shopping center space under operating leases. The LEASES minimum future rentals based on operating leases of Wholly- Owned Centers held as of December 31, 2000 are as follows:
Year Amount ---- -------- 2001 $367,233 2002 352,886 2003 325,220 2004 300,440 2005 262,294 Thereafter 982,599
F-29 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) Minimum future rentals do not include amounts which are payable by certain tenants based upon a percentage of their gross sales or as reimbursement of shopping center operating expenses. The tenant base includes national and regional retail chains and local retailers, and consequently, the Company's credit risk is concentrated in the retail industry. NOTE 8 GGMI TRANSACTIONS GGMI had previously been contracted to provide management, WITH AFFILIATES leasing, development and construction management services for the Wholly-Owned Centers. In addition, certain shopping center advertising and payroll costs of the properties were paid by GGMI and reimbursed by the Company. Total costs included in the consolidated financial statements related to agreements with GGMI are as follows:
Year Ended December 31, 2000 1999 1998 ------- ------- ------- Management and Leasing Fees $22,834 $21,201 $15,074 Cost Reimbursements 55,937 56,548 41,594 Development Costs 8,833 3,499 7,801
On January 1, 2001, in connection with the acquisition of the common stock of GGMI, the Company and GGMI agreed to concurrently terminate the management contracts with respect to the Wholly-Owned Centers. Effective January 1, 2001, the Wholly-Owned Centers will be self-managed under the same standards and procedures in effect prior to January 1, 2001. Notes Receivable-Officers In April, May and September, 1998 certain officers of the Company issued to the Company an aggregate of $3,164 of promissory notes in connection with their exercise of options to purchase an aggregate of 166,000 shares of the Company's Common Stock. During 1999, the Company received approximately $62 in payments, made advances of approximately $380 in conjunction with additional advances and Common Stock purchases by such officers and forgave approximately $64 in principal and accrued interest on such notes. During 2000, the Company has made aggregate advances of $7,149 in conjunction with the exercise of options to purchase an aggregate 270,000 shares of Common Stock by officers. In June 2000, a $1,120 loan was repaid by one of the officers. Also in 2000, the Company forgave approximately $150 of other notes receivable from an officer (previously reflected in prepaid expenses and other assets). In January 2001, the Company made an additional $1,120 advance to an officer in conjunction with the exercise of options to purchase 40,000 shares of Common Stock. The notes, which bear interest at a rate computed as a formula of a market rate, are collateralized by the shares of Common Stock issued upon exercise of such options, provide for quarterly payments of interest and are payable to the Company on demand. F-30 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) NOTE 9 EMPLOYEE Stock Incentive Plan BENEFIT AND The Company's Stock Incentive Plan provides incentives to STOCK PLANS attract and retain officers and key employees. An aggregate of 3,000,000 shares of Common Stock have been authorized for issuance under the plan. Options are granted by the Compensation Committee of the Board of Directors at an exercise price of not less than 100% of the fair market value of the Common Stock on the date of grant. The term of the option is fixed by the Compensation Committee, but no option is exercisable more than 10 years after the date of the grant. Options granted to officers and key employees are for 10-year terms and are generally exercisable in either 33 1/3% or 20% annual increments from the date of the grants. However, during 2000, 53,319 options were granted to certain employees under the Stock Incentive Plan (of which 5,000 were forfeited during 2000) with the same terms as the TSO's granted in 2000 (as described and defined below). Options granted to non-employee directors are exercisable in full commencing on the date of grant and expire on the tenth anniversary of the date of the grant. A summary of the status of the Company's Stock Incentive Plan as of December 31, 2000, 1999 and 1998 and changes during the year ended on those dates is presented below.
2000 1999 1998 ------------------- ------------------- ------------------- Weighted Weighted Weighted Average Average Average Exercise Exercise Exercise Shares Price Shares Price Shares Price --------- -------- --------- -------- --------- -------- Outstanding at beginning of year 827,500 $29.85 848,500 $28.99 785,000 $24.79 Granted 205,319 30.89 47,500 $32.42 229,500 $36.19 Exercised (276,500) 26.38 (60,000) $19.00 (166,000) $19.06 Forfeited (14,000) 33.97 (8,500) $34.78 -- -- --------- ------ --------- ------ --------- ------ Outstanding at end of year 742,319 31.36 827,500 $29.85 848,500 $28.99 ========= ========= ========= Exercisable at end of year 467,500 30.64 595,500 $28.76 414,500 $27.57 Options available for future grants 1,644,014 1,835,333 1,874,333 Weighted average per share fair value of options granted during the year $2.62 $2.84 $3.18
F-31 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) The following table summarizes information about stock options outstanding pursuant to the Stock Incentive Plan at December 31, 2000:
OPTIONS OUTSTANDING OPTIONS EXERCISABLE -------------------------------------------------------------------------------------------- Number Weighted Average Options Range Of Outstanding Remaining Weighted Average Exercisable Weighted Average Exercise Prices At 12/31/00 Contractual Life Exercise Price At 12/31/00 Exercise Price --------------- ----------- ---------------- ---------------- ----------- ---------------- $19.00 - $22.50 2,000 3.8 years $21.31 2,000 $21.31 $27.81 - $29.97 429,819 6.9 years $28.59 301,500 $27.99 $31.75 - $33.84 93,500 8.9 years $33.07 28,000 $32.76 $36.06 - $37.69 217,000 6.8 years $36.20 136,000 $36.21 ------- --------- ------ ------- ------ 742,319 7.1 years $31.36 467,500 $30.64 ======= ========= ====== ======= ======
1998 Incentive Plan General Growth also has an incentive stock plan entitled the 1998 Incentive Stock Plan (the "1998 Incentive Plan"). Under the 1998 Incentive Plan, stock incentive awards in the form of threshold-vesting stock options ("TSOs") are granted to employees. The exercise price of the TSOs to be granted to a participant will be the Fair Market Value ("FMV") of a share of Common Stock on the date the TSO is granted. The threshold price (the "Threshold Price") which must be achieved in order for the TSO to vest will be determined by multiplying the FMV on the date of grant by the Estimated Annual Growth Rate (currently set at 7% in the 1998 Incentive Plan) and compounding the product over a five year period. Shares of the Common Stock must achieve and sustain the Threshold Price for at least 20 consecutive trading days at any time over the five years following the date of grant in order for the TSO to vest. All TSOs granted will have a term of 10 years but must vest within 5 years of the grant date in order to avoid forfeiture. The aggregate number of shares of Common Stock which may be subject to TSOs issued pursuant to the 1998 Incentive Plan may not exceed 1,000,000, subject to certain customary adjustments to prevent dilution. TSOs to purchase 251,030 and 313,964 shares of Common Stock at an exercise price of $29.97 and $31.69 respectively, were granted in 2000 and 1999, respectively. The estimated fair value of the 2000 TSOs is $1.49 and the estimated fair value of the 1999 grants was $1.36. None of the TSOs granted in 2000 and 1999 have vested. In addition, 13,606 of the 251,030 shares granted in 2000 and 60,336 of the 313,964 shares granted in 1999 have been forfeited thru December 31, 2000. The fair value of each option grant for 2000, 1999 and 1998 for the Stock Incentive Plan and the 1998 Incentive Plan was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions:
2000 1999 1998 --------- --------- --------- Risk-free interest rate 6.19% 5.21% 5.48% Dividend yield 6.86% 7.22% 7.28% Expected life 5.2 years 4.6 years 4.2 years Expected volatility 18.2% 20.0% 19.4%
F-32 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) Employee Stock Purchase Plan During 1999, General Growth established the General Growth Properties, Inc. Employee Stock Purchase Plan (the "ESPP") to assist eligible employees in acquiring a stock ownership interest in the General Growth. A maximum of 500,000 shares of Common Stock is reserved for issuance under the ESPP. Under the ESPP, eligible employees make payroll deductions over a six-month purchase period at which time the amounts withheld are used to purchase shares of Common Stock at a purchase price equal to 85% of the lesser of the closing price of a share of Common Stock on the first trading day of the purchase period or the last trading day of the purchase period. The first purchase period under the ESAP ended December 31, 1999. On January 3, 2000, 26,205 shares of Common Stock were sold to ESPP participants at a price of $23.80 per share. The second purchase period under the ESPP ended June 30, 2000 at which time 41,534 shares of Common Stock were sold to ESPP participants at a price of $23.75 per share. The third purchase period ended on December 29, 2000 at which time 26,108 shares of Common Stock were sold to ESPP participants at a price of $27.09 per share. The fair value of the rights to purchase pursuant to the ESPP in 2000 was estimated to be $5.04 per share using the Black- Scholes option pricing model, with the following assumptions: a risk free rate of 5.95%, a dividend yield of 6.86% and expected volatility of 18.20%. Stock Option Pro Forma Data The Company had applied Accounting Principles Board Opinion 25 in accounting for the Stock Incentive Plan, the 1998 Incentive Plan and the Employee Stock Purchase Plan through June 30, 2000 as provided by Interpretation 44 as defined and further described in Note 12. Accordingly, no compensation costs have been recognized. Had compensation costs for the Company's plans been determined based on the fair value at the grant date for options granted in 2000, 1999 and 1998 in accordance with the method required by Statement of Financial Accounting Standards No. 123 "Accounting for Stock-Based Compensation", the Company's net income and net income per share would have been reduced to the pro forma amounts as follows:
Year Ended December 31, 2000 1999 1998 -------- ------- ------- Net Income As Reported $113,481 $76,658 $53,012 Pro Forma 113,081 $76,160 $52,709 Net earnings per share - basic As Reported $ 2.18 $ 1.67 $ 1.46 Pro Forma $ 2.17 $ 1.66 $ 1.46 Net earnings per share - diluted As Reported $ 2.18 $ 1.66 $ 1.46 Pro Forma $ 2.17 $ 1.65 $ 1.45
Management Savings Plan The Company sponsors the General Growth Management Savings and Employee Stock Ownership Plan (the "401(k) Plan") which permits all eligible employees to F-33 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) defer a portion of their compensation in accordance with the provisions of Section 401(k) of the Code. Under the 401(k) Plan, the Company may make, but is not obligated to make, contributions to match the contributions of the employees. For the years ending December 31, 2000, 1999 and 1998 the Company made matching contributions of approximately $3,554, $2,891 and $2,042 respectively. NOTE 10 DISTRIBUTIONS On December 15, 2000, the Company declared a cash PAYABLE distribution of $.53 per share that was paid on January 31, 2001, to stockholders of record (1,390 owners of record) on January 5, 2001, totaling $ 27,744. In addition, a distribution of $ 10,385 was paid to the limited partners of the Operating Partnership. Concurrently, the Company declared the fourth quarter 2000 preferred stock dividend, for the period from October 1, 2000 through December 31, 2000, in the amount of $0.4531 per share, payable to preferred stockholders of record on January 5, 2001 and paid on January 15, 2001. As described in Note 1, such preferred stock dividend was in the same amount as the Operating Partnership's distribution to the Company of the same date with respect to the Preferred Units held by the Company. On December 13, 1999, the Company declared a cash distribution of $.51 per share that was paid on January 31, 2000, to stockholders of record (1,121 owners of record) on January 6, 2000, totaling $26,481. In addition, a distribution of $10,097 was paid to the limited partners of the Operating Partnership. Concurrently, the Company declared the fourth quarter 1999 preferred stock dividend, for the period from October 1, 1999 through December 31, 1999, in the amount of $0.4531 per share, payable to preferred stockholders of record on January 6, 2000 and paid on January 14, 2000. The allocations of the common distributions declared and paid for income tax purposes are as follows:
Year Ended December 31, 2000 1999 1998 ------ ------ ------ Ordinary Income 92.2% 66.0% 98.0% Capital Gain --% 3.0% 2.0% Return of Capital 7.8% 31.0% --% ------ ------ ------ 100.0% 100.0% 100.0% ====== ====== ======
NOTE 11 In the normal course of business, from time to time, the COMMITMENTS AND Company is involved in legal actions relating to the CONTINGENCIES ownership and operations of its properties. In management's opinion, the liabilities, if any that may ultimately result from such legal actions are not expected to have a material adverse effect on the consolidated financial position, results of operations or liquidity of the Company. The Company leases land at certain properties from third parties. Rental expense including participation rent related to these leases was $460, $375 and $292 for the years ended December 31, 2000, 1999 and 1998, respectively. The leases generally provide for a right of first refusal in favor of the Company in the event of a proposed sale of the property by the landlord. F-34 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) From time to time the Company has entered into contingent agreements for the acquisition of properties. Each acquisition is subject to satisfactory completion of due diligence and, in the case of developments, completion and occupancy of the project. NOTE 12 During December 1999, the Securities and Exchange Commission RECENTLY ISSUED (the "SEC") issued Staff Accounting Bulletin 101 "Revenue ACCOUNTING Recognition" ("SAB" 101"). SAB 101 provides, among other PRONOUNCEMENTS things, that rental income should be deferred in interim periods by the lessor if the triggering events that create contingent rent have not yet occurred. The Company is entitled to receive contingent rents because a majority of the tenant leases provide for additional rent computed as a percentage of tenant sales revenues above certain annual thresholds. The Company had previously accrued, on an interim basis, such overage rents based on the prorated annual overage rent estimated to be due from tenants. The Company has applied this revised accounting effective January 1, 2000. There was no material cumulative effect on the Company's financial position as of the date of adoption of this revised accounting and the only material effect of this pronouncement is to shift the Company's recognition, including amounts from the operations of the Unconsolidated Real Estate Affiliates, of major portions of overage rent from interim quarters to the third and fourth quarter of 2000 and each subsequent year. The Company's cash collections of overage rent has not been affected by this accounting recognition change. On June 1, 1999 the FASB issued Statement No. 133 "Accounting for Derivative Instruments and Hedging Activities" ("Statement 133"). FASB Statement No. 138 "Accounting for Derivative Instruments and Hedging Activities-An Amendment of FASB Statement No 133" was issued in June 2000. Statement 133, as amended, is effective for fiscal years beginning after June 15, 2000 as provided by FASB Statement No. 137 issued in July 1999. The Company's only hedging activity is the cash value hedge represented by its cap agreements relating to its commercial mortgage- backed securities (Note 5). The interest rate cap agreements place a limit on the effective rate of interest the Company will bear on such floating rate obligations. The Company has concluded that these cap agreements are highly effective in achieving its objective of eliminating its exposure to variability in cash flows relating to these floating rate obligations when LIBOR rates exceed the strike rates of the cap agreements. However, Statement 133 also requires that the Company fair value the cap agreements as of the end of each reporting period. Interest rates have declined since the caps were obtained. The Company will adopt Statement 133 January 1, 2001. In accordance with the transition provisions of Statement 133, the Company will record at January 1, 2001 a loss to earnings of $3,334 as a cumulative-effect type transition adjustment to recognize at fair value the time-value portion of all the interest rate cap agreements that were previously designated as part of a hedging relationship. Included in the $3,334 loss is $704 relating to interest rate cap agreements held by Unconsolidated Real Estate Affiliates. The Company will also record $112 to other comprehensive income at January 1, 2001 to reflect the then fair value of the intrinsic portion of the interest rate cap agreements. Subsequent changes in the fair value of these agreements will be reflected in current earnings and accumulated other comprehensive income. As the remaining time-value portion of the fair value of the F-35 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) cap agreements at January 1, 2001 is not significant, any further decreases in the fair value of the cap agreements which would be required to be reflected in current earnings are not expected to be material. In March 2000, the FASB issued Statement of Accounting Standards Interpretation 44, "Accounting for Certain Transactions Involving Stock Compensation" ("Interpretation 44"). Interpretation 44 is generally effective for new stock option grants beginning July 1, 2000. However, the interpretive definition of an employee apply to new awards granted after December 15, 1998. Further, the FASB determined that any modifications to current accounting as a result of this guidance are to be recorded prospectively, effective as of July 1, 2000. General Growth has previously granted stock options to its employees, directors and to employees of its then unconsolidated subsidiary, GGMI (which, as of January 1, 2001, became a consolidated subsidiary). Under the terms of the Interpretation, any awards to GGMI employees are considered awards to non- employees. The Company has applied the accounting mandated by Interpretation 44 as of July 1, 2000 and there was virtually no impact on the Company's consolidated financial position or consolidated results of operations. Due to the acquisition of the common stock of GGMI by the Operating Partnership on January 1, 2001, those individuals who are employed by GGMI will be considered employees of General Growth for the purposes of accounting for stock option grants for 2001 and subsequent years. F-36 GENERAL GROWTH PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except for per share amounts) NOTE 13 QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
Year Ended First Second Third Fourth December 31, 2000 Quarter Quarter Quarter Quarter ----------------- -------- -------- -------- -------- Total Revenues $162,483 $165,026 $173,286 $197,972 Income before minority interest 36,680 37,791 44,840 71,017 Income before extraordinary items 28,241 27,950 31,363 50,394 Net income applicable to common shares 22,124 21,833 25,246 44,277 Earnings before extraordinary item per share - basic (a) $ 0.43 $ 0.42 $ 0.48 $ 0.85 Earnings before extraordinary item per share - diluted (a) 0.43 0.42 0.48 0.85 Net earnings per share - basic (a) 0.43 0.42 0.48 0.85 Net earnings per share - diluted (a) 0.43 0.42 0.48 0.85 Distributions declared per share $ 0.51 $ 0.51 $ 0.51 $ 0.53 Weighted average shares outstanding (in thousands) - basic 51,918 51,965 52,095 52,268 Weighted average shares outstanding (in thousands) - diluted 51,936 52,011 52,134 52,314 Year Ended First Second Third Fourth December 31, 1999 Quarter Quarter Quarter Quarter ----------------- -------- -------- -------- -------- Total Revenues $134,260 $135,916 $156,027 $186,139 Income before minority interest 27,545 33,208 35,770 51,456 Income before extraordinary items 23,329 24,415 28,783 38,394 Net income applicable to common shares 8,519 18,298 17,573 32,267 Earnings before extraordinary item per share -basic (a) $ 0.43 $ 0.44 $ 0.45 $ 0.62 Earnings before extraordinary item per share -diluted (a) 0.43 0.44 0.45 0.62 Net earnings per share - basic (a) 0.21 0.44 0.35 0.62 Net earnings per share - diluted (a) 0.21 0.44 0.35 0.62 Distributions declared per share $ 0.49 $ 0.49 $ 0.49 $ 0.51 Weighted average shares outstanding (in thousands) - basic 40,055 41,638 50,149 51,694 Weighted average shares outstanding (in thousands) - diluted 40,252 41,776 50,214 51,695
-------- (a) Earnings per share for the four quarters do not add up to the annual earnings per share due to the issuance of additional stock during the year. F-37 GENERAL GROWTH PROPERTIES, INC. Report of Independent Accountants on Financial Statement Schedule To the Board of Directors and Stockholders General Growth Properties, Inc. Our audits of the consolidated financial statements referred to in our report dated February 6, 2001 of General Growth Properties, Inc. which report and consolidated financial statements are included in this Annual Report on Form 10K also included an audit of the financial statement schedule listed in the Index to Consolidated Financial Statements and Consolidated Financial Statement Schedule on page F-1 of this Form 10-K. In our opinion, this financial statement schedule presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. Chicago, Illinois PricewaterhouseCoopers LLP February 6, 2001 F-38 GENERAL GROWTH PROPERTIES, INC. Schedule III - Real Estate and Accumulated Depreciation as of December 31, 2000
Col. A Col. B Col. C Col. D Col. E ------ ------ ------ ------ ------ Costs Capitalized Subsequent Gross Amounts at Which Initial Cost To Acquisition Carried at Close of Period --------------------------- ------------------------ ------------------------------------------ Buildings and Buildings Encumbrances Improvements Carrying And Description (e) Land (a) Improvements Costs (b) Land Improvements Total(c)(d) ---------------- ------------ ------------ -------------- ------------ ----------- ------------ -------------- -------------- Ala Moana Combined Honolulu, HI 500,000,000 336,229,260 473,770,740 14,481,654 5,231,765 336,229,497 493,484,159 829,713,656 Col. A Col. F Col. G Col. H Col. I ------ ------ ------ ------ ------ Life Upon Which Depreciation in Latest Income Accumulated Date of Date Statement is Description Depreciation Construction Acquired Computed - -------------------- ------------ ------------ -------- --------------- Ala Moana Combined Honolulu, HI 20,335,247 1999 (f) Apache Mall Rochester, MN 56,218,828 8,110,292 72,992,628 3,300,140 0 8,110,292 76,292,768 84,403,060 Apache Mall Rochester, MN 4,725,015 1998 (f) Baybrook Mall Friendswood, TX 94,086,611 13,300,000 117,162,546 1,595,005 0 13,300,000 118,757,551 132,057,551 Baybrook Mall Friendswood, TX 3,492,751 1999 (f) Bayshore Mall, Eureka, CA 37,250,000 3,004,345 27,398,907 22,852,279 2,887,090 3,005,040 53,138,276 56,143,316 Bayshore Mall, Eureka, CA 17,623,707 1986-1987 (f) Bellis Fair Mall, Bellingham, WA 73,000,000 7,616,458 47,040,131 9,315,718 6,122,020 7,485,224 62,477,869 69,963,093 Bellis Fair Mall, Bellingham, WA 23,663,035 1987-1988 (f) Birchwood Mall, Port Huron, MI 43,953,445 1,768,935 34,574,635 11,693,673 1,980,603 3,045,616 48,248,911 51,294,527 Birchwood Mall, Port Huron, MI 15,553,162 1989-1990 (f) Boulevard Mall Las Vegas, NV 88,765,714 16,490,343 148,413,086 3,120,520 0 16,490,343 151,533,606 168,023,949 Boulevard Mall Las Vegas, NV 9,595,509 1998 (f) Capital Mall Jefferson City, MO 16,500,000 4,200,000 14,201,000 6,384,326 0 3,912,935 20,585,326 24,498,261 Capital Mall Jefferson City, MO 4,188,652 1993 (f) Century Mall Birmingham, AL 32,000,000 3,164,000 28,513,908 3,595,222 0 3,164,000 32,109,130 35,273,130 Century Mall Birmingham, AL 2,973,670 1997 (f) Chapel Hills Colorado Springs, CO 36,750,000 4,300,000 34,017,000 58,397,277 36,805 4,300,000 92,451,082 96,751,082 Chapel Hills Colorado Springs, CO 13,309,613 1993 (f) Coastland Center Naples, FL 85,650,692 11,450,000 103,050,200 3,037,525 0 11,450,000 106,087,725 117,537,725 Coastland Center Naples, FL 5,823,089 1998 (f) Colony Square Mall Zanesville, OH 25,600,000 1,000,000 24,500,000 12,573,545 0 1,243,184 37,073,545 38,316,729 Colony Square Mall Zanesville, OH 13,216,189 1986 (f) Columbia Mall Columbia, MO 56,100,000 5,383,208 19,663,231 10,300,343 1,368,803 5,383,208 31,332,377 36,715,585 Columbia Mall Columbia, MO 13,760,013 1984-1985 (f) Coral Ridge Mall Coralville, IA 80,028,435 3,363,602 64,217,772 8,311,150 4,420,355 3,363,602 76,949,277 80,312,879 Coral Ridge Mall Coralville, IA 6,021,935 1998-1999 (f) Crossroads (MI) Kalamazoo, MI 44,440,854 6,800,000 61,200,000 2,342,926 41,616 6,800,000 63,584,542 70,384,542 Crossroads (MI) Kalamazoo, MI 3,211,356 1999 (f) Crossroads Center St. Cloud, MN 46,055,322 10,851,689 72,002,847 1,368,576 82,242 10,929,119 73,453,665 84,382,784 Crossroads Center St. Cloud, MN 1,079,262 2000 (f)
F-39 GENERAL GROWTH PROPERTIES, INC.
Col. A Col. B Col. C Col. D Col. E ------ ------ ------ ------ ------ Costs Capitalized Subsequent Gross Amounts at Which Initial Cost To Acquisition Carried at Close of Period --------------------------- ------------------------ ------------------------------------------ Buildings and Buildings Encumbrances Improvements Carrying And Description (e) Land (a) Improvements Costs (b) Land Improvements Total(c)(d) - ---------------- -------------- ------------ -------------- ------------ ----------- ------------ -------------- -------------- Cumberland Mall Atlanta, GA 98,837,813 15,198,568 136,787,110 2,529,067 31,518 15,198,568 139,347,695 154,546,263 Col. A Col. F Col. G Col. H Col. I ------ ------ ------ ------ ------ Life Upon Which Depreciation in Latest Income Accumulated Date of Date Statement is Description Depreciation Construction Acquired Computed - ----------------- ------------ ------------ -------- --------------- Cumberland Mall Atlanta, GA 8,700,812 1998 (f) Development in Progress 0 17,936,214 7,610,519 0 17,936,214 7,610,519 25,546,733 Development in Progress 0 Eagle Ridge Mall Lake Wales, FL 27,000,000 7,619,865 49,560,538 5,240,518 5,678,662 7,621,768 60,479,718 68,101,486 Eagle Ridge Mall Lake Wales, FL 8,466,079 1995-1996 (f) Eden Prairie Mall Eden Prairie, MN 0 465,063 19,024,047 28,245,168 2,688,933 465,063 49,958,148 50,423,211 Eden Prairie Mall Eden Prairie, MN 2,554,040 1997 (f) Fallbrook Mall, West Hills, CA 46,900,000 6,117,338 10,076,520 57,565,167 2,696,787 6,127,138 70,338,474 76,465,612 Fallbrook Mall, West Hills, CA 25,953,530 1984 (f) Fox River Mall Appleton, WI 93,200,000 2,700,566 18,291,067 33,581,270 1,820,253 4,787,291 53,692,590 58,479,881 Fox River Mall Appleton, WI 18,789,481 1983-1984 (f) Gateway Mall, Springfield, OR 30,750,000 8,728,263 34,707,170 18,723,328 7,624,197 8,749,088 61,054,695 69,803,783 Gateway Mall, Springfield, OR 18,185,248 1989-1990 (f) GGPLP Corp. Chicago, IL 318,163,109 0 556,740 88,729,876 0 0 89,286,616 89,286,616 GGPLP Corp. Chicago, IL 86,991 (f) 110 Building Chicago, IL 20,000,000 0 29,035,310 2,912,160 0 0 31,947,470 31,947,470 110 Building Chicago, IL 2,649,962 1997 (f) Grand Traverse Mall, Grand Traverse, MI 51,500,000 3,529,966 20,775,772 20,755,982 3,643,793 3,533,745 45,175,547 48,709,292 Grand Traverse Mall, Grand Traverse, MI 13,956,597 1990-1991 (f) Greenwood Mall Bowling Green, KY 39,500,000 3,200,000 40,202,000 18,107,939 0 3,431,918 58,309,939 61,741,857 Greenwood Mall Bowling Green, KY 12,401,423 1993 (f) Knollwood Mall, St. Louis Park, MN 10,000,000 0 9,748,047 27,915,997 2,340,180 7,025,606 40,004,224 47,029,830 Knollwood Mall, St. Louis Park, MN 14,614,498 1978 (f) Lakeview Square Mall Battle Creek, MI 26,101,407 3,578,619 32,209,980 10,024,096 42,469 3,578,619 42,276,545 45,855,164 Lakeview Square Mall Battle Creek, MI 4,243,019 1996 (f) Lansing Mall Lansing, MI 41,865,612 6,977,798 62,800,179 7,345,721 49,923 6,977,798 70,195,823 77,173,621 Lansing Mall Lansing, MI 7,016,317 1996 (f) Lockport Mall, Lockport, NY 9,300,000 800,000 10,000,000 4,247,075 23,656 800,000 14,270,731 15,070,731 Lockport Mall, Lockport, NY 5,149,125 1986 (f)
F-40 GENERAL GROWTH PROPERTIES, INC.
Col. A Col. B Col. C Col. D ------ ------ ------ ------ Costs Capitalized Subsequent Initial Cost To Acquisition --------------------------- ------------------------ Buildings and Encumbrances Improvements Carrying Description (e) Land (a) Improvements Costs (b) ---------------- -------------- ------------ -------------- ------------ ----------- Mall of the Bluffs, Council Bluffs, IA 43,953,445 1,860,116 24,016,343 13,934,688 2,529,093 Col. A Col. E Col. F Col. G Col. H Col. I ------ ------ ------ ------ ------ ------ Gross Amounts at Which Carried at Close of Period -------------------------------------------- Life Upon Which Depreciation in Buildings Latest Income And Accumulated Date of Date Statement is Description Land Improvements Total(c)(d) Depreciation Construction Acquired Computed - ------------------ ------------ --------------- --------------- ------------ ------------ -------- --------------- Mall of the Bluffs, Council Bluffs, IA 1,895,220 40,480,124 42,375,344 14,235,180 1985-1986 (f) Mall St. Vincent Shreveport, LA 18,786,337 2,640,000 23,760,000 2,658,318 0 Mall St. Vincent Shreveport, LA 2,640,000 26,418,318 29,058,318 1,593,404 1998 (f) Marketplace Champaign, IL 47,000,000 7,000,000 63,972,357 32,643,237 40,968 Marketplace Champaign, IL 7,000,000 96,656,562 103,656,562 6,975,888 1997 (f) McCreless Mall San Antonio, TX 0 1,000,000 9,000,002 424,937 0 McCreless Mall San Antonio, TX 1,000,000 9,424,939 10,424,939 633,803 1998 (f) MEPC Acquisition Financing 0 0 0 0 0 MEPC Acquisition Financing 0 (1,543,887) (1,543,887) 33,967 Northridge Fashion Center Northridge, CA 106,364,102 16,618,095 149,562,583 9,642,506 2,977,145 Northridge Fashion Center Northridge, CA 16,975,131 162,182,234 179,157,365 10,199,318 1998 (f) Oakwood Mall, Eau Claire, WI 58,604,593 3,266,669 18,281,160 18,503,779 1,711,573 Oakwood Mall, Eau Claire, WI 3,617,262 38,496,512 42,113,774 13,876,401 1985-1986 (f) Park Mall Tucson, AZ 50,000,000 4,996,024 44,993,177 64,141,572 4,287,996 Park Mall Tucson, AZ 4,715,836 113,422,745 118,138,581 6,946,607 1996 (f) Piedmont Mall, Danville, VA 16,750,000 2,000,000 38,000,000 3,602,722 20,787 Piedmont Mall, Danville, VA 2,000,000 41,623,509 43,623,509 5,789,233 1995 (f) Pierre Bossier Mall Bossier City, LA 40,948,801 5,280,707 47,558,468 2,845,909 0 Pierre Bossier Mall Bossier City, LA 5,283,970 50,404,377 55,688,347 2,871,538 1998 (f) The Pines, Pine Bluff, AR 26,750,000 1,488,928 17,627,258 9,891,252 1,365,091 The Pines, Pine Bluff, AR 1,247,414 28,883,601 30,131,015 10,513,288 1985-1986 (f) Regency Square Mall Jacksonville, FL 86,533,675 16,497,552 148,477,968 4,276,971 0 Regency Square Mall Jacksonville, FL 16,506,853 152,754,939 169,261,792 9,555,861 1998 (f) Rio West Mall, Gallup, NM 13,500,000 0 19,500,000 4,804,389 0 Rio West Mall, Gallup, NM 0 24,304,389 24,304,389 8,120,753 1986 (f) River Falls Mall, Clarksville, IN 28,000,000 3,177,688 54,610,421 7,299,882 5,281,892 River Falls Mall, Clarksville, IN 3,182,305 67,192,195 70,374,500 23,456,921 1989-1990 (f) River Hills Mall, Mankato, MN 51,200,000 3,713,529 29,013,757 17,407,275 2,603,416 River Hills Mall, Mankato, MN 4,707,314 49,024,448 53,731,762 14,459,371 1990-1991 (f) Riverlands Shopping Center LaPlace, LA 0 500,000 4,500,000 190,299 0 Riverlands Shopping Center LaPlace, LA 500,000 4,690,299 5,190,299 350,850 1998 (f)
F-41 GENERAL GROWTH PROPERTIES, INC.
Col. A Col. B Col. C Col. D Col. E ------ ------ ------ ------ ------ Costs Capitalized Subsequent Gross Amounts at Which Initial Cost To Acquisition Carried at Close of Period --------------------------- ------------------------- ------------------------------------------ Buildings and Buildings Encumbrances Improvements Carrying And Description (e) Land (a) Improvements Costs (b) Land Improvements Total(c)(d) ---------------- -------------- ------------ -------------- ------------ ----------- ------------ -------------- -------------- Rivertown Crossing Grandville, MI 109,999,997 10,972,923 97,141,738 25,876,171 12,889,406 7,246,462 135,907,315 143,153,777 Col. A Col. F Col. G Col. H Col. I ------ ------ ------ ------ ------ Life Upon Which Depreciation in Latest Income Accumulated Date of Date Statement is Description Depreciation Construction Acquired Computed - ------------------ ------------ ------------ -------- --------------- Rivertown Crossing Grandville, MI 4,353,186 1998-1999 (f) Sooner Fashion Mall, Norman, OK 20,000,000 2,700,000 24,300,000 13,043,186 0 2,580,578 37,343,186 39,923,764 Sooner Fashion Mall, Norman, OK 3,174,793 1996 (f) Southlake Mall, Morrow, GA 51,300,000 6,700,000 60,406,902 9,272,591 0 6,700,000 69,679,493 76,379,493 Southlake Mall, Morrow, GA 5 ,621,045 1997 (f) SouthShore Mall, Aberdeen, WA 9,000,000 650,000 15,350,000 5,268,915 0 650,000 20,618,915 21,268,915 SouthShore Mall, Aberdeen, WA 7,332, 334 1986 (f) Southwest Plaza Littleton, CO 83,936,068 9,000,000 103,983,673 11,430,141 118,012 9,000,000 115,531,826 124,531,826 Southwest Plaza Littleton, CO 7,323,807 1998 (f) Spring Hill West Dundee, IL 89,726,859 12,400,000 111,643,525 3,780,912 0 12,400,000 115,424,437 127,824,437 Spring Hill West Dundee, IL 7,279,691 1998 (f) Valley Hills, Harrisonburg, VA 34,675,327 3,443,594 31,025,471 20,368,473 47,615 5,656,275 51,441,559 57,097,834 Valley Hills, Harrisonburg, VA 3,047,443 1997 (f) Valley Plaza Shopping Center Bakersfield, CA 74,679,067 12,685,151 114,166,356 (6,616,950) 0 12,685,151 107,549,406 120,234,557 Valley Plaza Shopping Center Bakersfield, CA 6,854,466 1998 (f) West Valley Mall, Tracy, CA 32,000,000 9,295,045 47,789,310 11,763,585 7,756,557 10,890,502 67,309,452 78,199,954 West Valley Mall, Tracy, CA 9,378,925 1995 (f) Westwood Mall Jackson, MI 20,900,000 2,658,208 23,923,869 3,450,367 0 3,571,208 27,374,236 30,945,444 -------------- ------------ -------------- ------------ ----------- ------------ -------------- -------------- Westwood Mall Jackson, MI 2,812,474 1996 (f) ------------ Grand Totals $3,244,126,113 $654,506,050 $3,163,403,012 $768,859,180 $90,441,221 $667,096,357 $4,024,103,672 $4,691,200,029 ============== ============ ============== ============ =========== ============ ============== ============== Grand Totals $488,129,874 ============
F-42 GENERAL GROWTH PROPERTIES, INC General Growth Properties, Inc. Notes to Schedule III (Dollars in Thousands) (a) See description of mortgage notes payable in Note 5 of Notes to Consolidated Financial Statements. (b) Initial cost for constructed malls is cost at end of first complete calendar year subsequent to opening. (c) Carrying costs consists of capitalized construction- period interest and taxes. (d) The aggregate cost of land, buildings and equipment for federal income tax purposes is approximately $3,467,614 Reconciliation of Real Estate
1998 1999 2000 ---- ---- ---- Balance at beginning of year $1,863,485 $3,676,796 $4,326,551 Additions: 1,813,311 1,238,874 364,649 Reductions: -- (589,119) -- ---------- ---------- ---------- Balance at close of year $3,676,796 $4,326,551 $4,691,200 ========== ========== ==========
Reconciliation of Accumulated Depreciation
1998 1999 2000 ---- ---- ---- Balance at beginning of year $233,295 $301,789 $376,673 Depreciation Expense 68,494 105,046 $111,457 Reductions: -- (30,162) -- -------- -------- -------- Balance at close of year $301,789 $376,673 $488,130 ======== ======== ========
(f) Depreciation is computed based upon the following estimated lives: Buildings, improvements and carrying costs 40 years Tenant allowances 10 - 40 years Equipment and fixtures 10 years
F-43 GENERAL GROWTH PROPERTIES, INC. EXHIBIT INDEX 2(a) Purchase and Sale Agreement dated as of May 3, 1999, among D/E Hawaii Joint Venture, GGP Limited Partnership and General Growth Properties, Inc. (17) 2(b) Agreement of Purchase and Sale, dated as of July 27, 1999, among Oak View Mall Corporation, a Delaware corporation, and Oak View Mall, L.L.C., a Delaware limited liability company. (18) 2(c) Agreement of Purchase and Sale, dated as of July 22, 1999 between General Growth Properties, Inc., a Delaware corporation (the "Company"), and RREEF USA Fund-III, a California group trust. (18) 2(d) Operating Agreement, dated November 10, 1999, between GGP Limited Partnership, a Delaware limited partnership, The Comptroller of the State of New York as Trustee of the Common Retirement Fund ("NYSCRF"), and GGP/Homart II L.L.C. a Delaware limited liability company ("GGP/ Homart II"). (19) 2(e) Contribution Agreement dated November 10, 1999, by and between GGP Limited Partnership, a Delaware limited partnership (the "Operating Partnership"), and GGP/Homart II (Altamonte Mall). (19) 2(f) Contribution Agreement dated November 10, 1999, by and between the Operating Partnership and GGP/Homart II (Northbrook Court). (19) 2(g) Contribution Agreement dated November 10, 1999, by and between the Operating Partnership and GGP/Homart II (Natick Trust). (19) 2(h) Contribution Agreement dated November 10, 1999, by and between the Operating Partnership and GGP/Homart II (Stonebriar Centre). (19) 2(i) Contribution Agreement dated November 10, 1999, by and between NYSCRF and GGP/Homart II (Carolina Place). (19) 2(j) Contribution Agreement dated November 10, 1999, by and between NYSCRF and GGP/Homart II (Alderwood Mall). (19) 2(k) Contribution Agreement dated November 10, 1999, by and between NYSCRF and GGP/Homart II (Montclair Plaza). (19) 2(l) Contribution Agreement, dated February 1, 2000, by and between General Growth Companies, Inc. and GGP Limited Partnership. (20) 2(m) Purchase and Sale Agreement dated as of March 15, 2000 by and between Crossroads Shopping Center Trust and St. Cloud Mall L.L.C. (21) 2(n) Purchase Agreement dated May 25, 2000 among General Growth Properties, Inc., GGP Limited Partnership, GGPLP L.L.C. and Goldman Sachs 2000 Exchange Place Fund, L.P. (23) 3(a) Amended and Restated Certificate of Incorporation of the Company. (2) 3(b) Amendment to Amended and Restated Certificate of Incorporation of the Company.(3) 3(c) Amendment to Amended and Restated Certificate of Incorporation of the Company filed on December 21, 1995.(6) S-1 GENERAL GROWTH PROPERTIES, INC. 3(d) Amendment to Amended and Restated Certificate of Incorporation of the Company filed on May 20, 1997.(10) 3(e) Amendment to Second Amendment and Restated Certificate of Incorporation of the Company filed on May 17, 1999.(17) 3(f) Bylaws of the Company.(3) 3(g) Amendment to Bylaws of the Company.(3) 4(a) Redemption Rights Agreement, dated July 13, 1995, by and among GGP Limited Partnership, General Growth Properties, Inc. and the persons listed on the signature pages thereof.(5) 4(b) Redemption Rights Agreement dated December 6, 1996, among GGP Limited Partnership, a Delaware corporation, Forbes/Cohen Properties, a Michigan general partnership, Lakeview Square Associates, a Michigan general partnership, and Jackson Properties, a Michigan general partnership.(1) 4(c) Redemption Rights Agreement, dated June 19, 1997, among GGP Limited Partnership, a Delaware limited partnership, General Growth Properties, Inc., a Delaware corporation, and CA Southlake Investors, Ltd., a Georgia limited partnership.(8) 4(d) Redemption Rights Agreement dated October 23, 1997, among GGPI, GGPLP and Peter Leibowits.(10) 4(e) Form of Indenture.(7) 4(f) Certificate of Designations, Preferences and Rights of 7.25% Preferred Equity Redeemable Stock, Series A.(14) 4(g) Amendment to Certificate of Designations, Preferences and Rights of 7.25% Preferred Income Equity Redeemable Stock, Series A of General Growth Properties, Inc. filed on May 17, 1999.(17) 4(h) Redemption Rights Agreement dated April 2, 1998, among GGP Limited Partnership, General Growth Properties, Inc. and Southwest Properties Venture. (11) 4(i) Indenture and Servicing Agreement dated as of November 25, 1997, among the Issuers named therein, LaSalle National Bank, as Trustee, and Midland Loan Services, L.P., as Servicer (the "Indenture Agreement"). (12) 4(j) Form of Note pursuant to the Indenture Agreement. (12) 4(k) Mortgage, Deed of Trust, Security Agreement, Assignment of Leases and Rents, Fixture Filing and Financing Statement, date and effective as of November 25, 1997, among the Issuers, the Trustee and the Deed Trustees named therein. (12) 4(l) Rights Agreement, dated November 18, 1998, between General Growth Properties, Inc. and Norwest Bank Minnesota, N.A., as Rights Agent (including the Form of Certificate of Designation of Series A Junior Participating Preferred Stock attached thereto as Exhibit A, the Form of Right Certificate attached Preferred Stock attached thereto as Exhibit C). (15) 4(m) Form of Common Stock Certificate. (16) 4(n) First Amendment to Rights Agreement, dated as of November 10, 1999, between the Company and Norwest Bank, Minnesota, N.A. (18) S-2 GENERAL GROWTH PROPERTIES, INC. 4(o) Letter Agreement concerning Rights Agreement, dated November 10, 1999, between the Operating Partnership and NYSCRF. (18) 4(p) Certificate of Designations, Preferences and Rights of 8.95% Cumulative Redeemable Preferred Stock, Series B. (22) 10(a) Second Amended and Restated Agreement of Limited Partnership of the Operating Partnership. (13) 10(b) Rights Agreement between the Company and the Limited Partners of the Operating Partnership.(4) 10(c)* General Growth Properties, Inc. 1993 Stock Incentive Plan, as amended.(9) 10(d) Form of Amended and Restated Agreement of Partnership for each of the Property Partnerships.(2) 10(e) Form of Indemnification Agreement between the Operating Partnership, Martin Bucksbaum, Matthew Bucksbaum, Mall Investment L.P. and M. Bucksbaum Company. (2) 10(f) Form of Registration Rights Agreement between the Company and the Bucksbaums. (2) 10(g) Form of Registration Rights Agreement between the Company and certain trustees for the IBM Retirement Plan. (2) 10(h) Form of Incidental Registration Rights Agreement between the Company, Equitable, Frank Russell and Wells Fargo.(2) 10(i) Form of Letter Agreements restricting sale of certain shares of Common Stock.(2) 10(j)* Letter Agreement dated October 14, 1993, between the Company and Bernard Freibaum.(4) 10(k)* Form of Option Agreement between the Company and certain Executive Officers.(8) 10(l)* General Growth Properties, Inc. 1998 Incentive Stock Plan.(16) 10(m) Amended and Restated Operating Agreement of GGPLP L.L.C. dated as of May 25, 2000. (22) 10(n) Registration Rights Agreement dated May 25, 2000 between General Growth Properties, Inc. and Goldman Sachs 2000 Exchange Place Fund, L.P. (23) 10(o) Term Loan Agreement, dated as of July 31, 2000, among the Operating Partnership and GGPLP L.L.C. (collectively "Borrower"), Bankers Trust Company ("BT") and Lehman Commercial Paper Inc. ("Lehman"). 10(p) Promissory Note dated July 31, 2000 made by Borrower in favor of BT. 10(q) Promissory Note dated July 31, 2000 made by Borrower in favor of Lehman. 10(r) Joinder Agreement, dated as of September 1, 2000, between Bayerische Hypo-Und Vereinsbank AG, New York Branch ("Hypo") and Borrower. 10(s) Promissory Note dated September 1, 2000 made by Borrower in favor of Hypo. 10(t) Joinder Agreement, dated as of September 22, 2000, between Fleet National Bank ("Fleet") and Borrower. S-3 GENERAL GROWTH PROPERTIES, INC. 10(u) Promissory Note dated September 22, 2000 made by Borrower in favor of Fleet. 10(v) First Amendment to Term Loan Agreement, dated as of September 22, 2000, among Borrower and BT, Lehman, Hypo and Fleet. 10(w) Lender Addendum, dated as of October 20, 2000, between Lehman, Borrower and BT. 10(x) Replacement Note dated October 20, 2000 made by Borrower in favor of Lehman. 10(y) Joinder Agreement, dated as of December 28, 2000, between The Chase Manhattan Bank ("Chase"), Borrower, BT and Lehman. 10(z) Promissory Note dated December 28, 2000 made by Borrower in favor of Chase. 10(aa) Second Amendment to Term Loan Agreement, dated as of December 28, 2000, among Borrower and BT, Lehman, Fleet and Chase. 10(bb) Revolving Credit Agreement, dated as of July 31, 2000, among Borrower, Bank of America, N.A. ("BofA") Dresdner Bank, AG ("Dresdner"), and U.S. Bank National Association ("USB"). 10(cc) Promissory Note dated July 31, 2000 made by Borrower in favor of BofA. 10(dd) Promissory Note dated July 31, 2000 made by Borrower in favor of Dresdner. 10(ee) Promissory Note dated July 31, 2000 made by Borrower in favor of USB. 10(ff) Joinder to Revolving Credit Agreement, dated as of September 1, 2000, among Hypo, Borrower, BofA, Dresdner and USB. 10(gg) Promissory Note dated September 1, 2000 made by Borrower in favor of Hypo. 21 List of Subsidiaries of General Growth Properties, Inc. 23 Consent of PricewaterhouseCoopers LLP - Independent Accountants. (*) A compensatory plan or arrangement required to be filed. - ------------------------------------------------------------------------------- (1) Previously filed as an exhibit to the Company's Current Report on Form 8-K dated January 3, 1996, incorporated herein by reference. (2) Previously filed as an exhibit to the Company's Registration Statement on Form S-11 (No. 33-56640), incorporated herein by reference. (3) Previously filed as an exhibit to the Company's Annual Report on Form 10-K for the year ended December 31, 1994, incorporated herein by reference. (4) Previously filed as an exhibit to the Company's Annual Report on Form 10-K for the year ended December 31, 1993, incorporated herein by reference. (5) Previously filed as an exhibit to the Company's Current Report on Form 8-K dated July 17, 1996, incorporated herein by reference. S-4 GENERAL GROWTH PROPERTIES, INC. (6) Previously filed as an exhibit to the Company's Annual Report on Form 10-K for the year ended December 31, 1995, incorporated herein by reference. (7) Previously filed as an exhibit to the Company's Registration Statement on Form S-3 (No. 333-37247) dated October 6, 1997, incorporated herein by reference. (8) Previously filed as an exhibit to the Company's Annual Report on Form 10-K for the year ended December 31, 1996, incorporated herein by reference. (9) Previously filed as an exhibit to the Company's Registration Statement on Form S-8 (No. 333-28449) dated June 3, 1997, incorporated herein by reference. (10) Previously filed as an exhibit to the Company's Annual Report on Form 10-K for the year ended December 31, 1997, incorporated herein by reference. (11) Previously filed as an exhibit to the Company's current report on Form 8-K dated May 26, 1998, incorporated herein by reference. (12) Previously filed as an exhibit to the Company's current report on Form 8-K/A dated June 2, 1998, incorporated herein by reference. (13) Previously filed as an exhibit to the Company's current report on Form 10-Q dated May 14, 1998, as amended May 21, 1998, incorporated herein by reference. (14) Previously filed as an exhibit to the Company's current report on Form 8-K dated August 7, 1998, incorporated herein by reference. (15) Previously filed as an exhibit to the Company's current report on Form 8-K, dated November 18, 1998, incorporated herein by reference. (16) Previously filed as an exhibit to the Company's Annual Report on Form 10-K for the year ended December 31, 1998, incorporated herein by reference. (17) Previously filed as an exhibit to the Company's Current Report on Form 8-K, dated July 12, 1999, incorporated herein by reference. (18) Previously filed as an exhibit to the Company's Current Report on Form 8-K, dated November 23, 1999, incorporated herein by reference. (19) Previously filed as an exhibit to the Company's Current Report on Form 8-K/A, dated January 11, 2000, incorporated herein by reference. (20) Previously filed as an exhibit to the Company's Annual Report on Form 10-K for the year ended December 31, 1999, incorporated herein by reference. (21) Previously filed as an exhibit to the Company's Current Report on Form 8-K, dated May 9, 2000, incorporated herein by reference. (22) Previously filed as an exhibit to the Company's Current Report on Form 8-K, dated June 13, 2000, incorporated herein by reference. (23) Previously filed as an exhibit to the Company's Quarterly Report on Form 10-Q dated August 9, 2000, incorporated herein by reference. S-5 EX-10.(O) 2 dex10o.txt 7/31/00 TERM NOTE AGREEMENT Exhibit 10(o) EXECUTION COPY ================================================================================ TERM LOAN AGREEMENT among GGP LIMITED PARTNERSHIP, as Borrower, GGPLP L.L.C., as Borrower, The Institutions From Time to Time Parties Hereto, as Lenders, BANKERS TRUST COMPANY, as Administrative Agent, and LEHMAN COMMERCIAL PAPER INC., as Syndication Agent, Dated as of July 31, 2000 ___________________________ DEUTSCHE BANK SECURITIES, INC. AND LEHMAN BROTHERS INC., as Co-Lead Arrangers and Joint Book Running Managers ================================================================================ Table of Contents
Page ARTICLE I DEFINITIONS.................................................................................... 1 1.1. Certain Defined Terms.................................................................... 1 1.2. Computation of Time Periods.............................................................. 23 1.3. Accounting Terms......................................................................... 24 1.4. Other Terms.............................................................................. 24 ARTICLE II AMOUNTS AND TERMS OF LOANS.................................................................... 24 2.1. Loans.................................................................................... 24 2.2. [Intentionally Omitted].................................................................. 25 2.3. Use of Proceeds of Loans................................................................. 25 2.4. Repayment................................................................................ 25 2.5. [Intentionally Omitted].................................................................. 26 2.6. [Intentionally Omitted].................................................................. 26 2.7. Authorized Agents........................................................................ 26 ARTICLE III ADDITIONAL LOANS............................................................................. 26 3.1. Additional Loans......................................................................... 26 3.2. Joinder of New Lender.................................................................... 26 3.3. Additional Loans made by Existing Lender................................................. 27 ARTICLE IV PAYMENTS AND PREPAYMENTS...................................................................... 28 4.1. Prepayments.............................................................................. 28 4.2. Payments................................................................................. 29 4.3. Promise to Repay; Evidence of Indebtedness............................................... 31 ARTICLE V INTEREST AND FEES.............................................................................. 31 5.1. Interest on the Loans and Other Obligations.............................................. 31
i 5.2. Special Provisions Governing Eurodollar Rate Loans....................................... 34 5.3. Fees..................................................................................... 37 ARTICLE VI CONDITIONS TO LOANS........................................................................... 37 6.1. Conditions Precedent to the Initial Loans................................................ 37 6.2. Conditions Precedent to All Subsequent Loans............................................. 39 ARTICLE VII REPRESENTATIONS AND WARRANTIES............................................................... 40 7.1. Representations and Warranties of the Borrower........................................... 40 ARTICLE VIII REPORTING COVENANTS......................................................................... 49 8.1. Borrower Accounting Practices............................................................ 49 8.2. Financial Reports........................................................................ 49 8.3. Events of Default........................................................................ 52 8.4. Lawsuits................................................................................. 53 8.5. Insurance................................................................................ 53 8.6. ERISA Notices............................................................................ 53 8.7. Environmental Notices.................................................................... 55 8.8. Labor Matters............................................................................ 55 8.9. Notices of Asset Sales and/or Acquisitions............................................... 55 8.10. Other Reports............................................................................ 56 8.11. Other Information........................................................................ 56 ARTICLE IX AFFIRMATIVE COVENANTS......................................................................... 56 9.1. Existence, Etc........................................................................... 56 9.2. Powers; Conduct of Business.............................................................. 56 9.3. Compliance with Laws, Etc................................................................ 56 9.4. Payment of Taxes and Claims.............................................................. 57 9.5. Insurance................................................................................ 57
ii 9.6. Inspection of Property; Books and Records; Discussions................................... 57 9.7. ERISA Compliance......................................................................... 57 9.8. Maintenance of Property.................................................................. 58 9.9. Management of the Company................................................................ 58 9.10. Ownership of Property.................................................................... 58 9.11. Committed Financing...................................................................... 58 ARTICLE X NEGATIVE COVENANTS............................................................................. 58 10.1. Sales of Assets.......................................................................... 58 10.2. Liens.................................................................................... 58 10.3. Conduct of Business...................................................................... 59 10.4. Transactions with Partners and Affiliates................................................ 59 10.5. Restriction on Fundamental Changes and Changes of Control................................ 59 10.6. Margin Regulations; Securities Laws...................................................... 60 10.7. ERISA.................................................................................... 60 10.8. Organizational Documents................................................................. 60 10.9. Fiscal Year.............................................................................. 60 10.10. [Intentionally Omitted]................................................................. 61 10.11. Investments............................................................................. 61 10.12. Other Financial Covenants............................................................... 62 ARTICLE XI EVENTS OF DEFAULT; RIGHTS AND REMEDIES........................................................ 65 11.1. Events of Default....................................................................... 65 11.2. Rights and Remedies..................................................................... 68 ARTICLE XII THE CO-AGENTS................................................................................ 69 12.1. Appointment............................................................................. 69 12.2. Powers.................................................................................. 69
iii 12.3. General Immunity........................................................................ 70 12.4. No Responsibility for Loans, Recitals, etc.............................................. 70 12.5. Action on Instructions of Lenders....................................................... 70 12.6. Employment of Agents and Counsel........................................................ 70 12.7. Reliance on Documents................................................................... 70 12.8. Co-Agents' Reimbursement and Indemnification............................................ 71 12.9. Rights as a Lender...................................................................... 71 12.10. Lender Credit Decision.................................................................. 71 12.11. Successor Co-Agents..................................................................... 72 12.12. Notice of Defaults...................................................................... 72 12.13. Requests for Approval................................................................... 73 12.14. Copies of Documents..................................................................... 73 12.15. Withholding Tax......................................................................... 73 12.16. Borrower's Default; Enforcement......................................................... 73 12.17. Relationship of Parties................................................................. 73 12.18. Counsel................................................................................. 74 ARTICLE XIII YIELD PROTECTION............................................................................ 74 13.1. Taxes................................................................................... 74 13.2. Increased Capital....................................................................... 76 13.3. Changes; Legal Restrictions............................................................. 77 ARTICLE XIV BENEFIT OF LOANS............................................................................. 78 ARTICLE XV MISCELLANEOUS................................................................................. 78 15.1. Assignments and Participations.......................................................... 78 15.2. Expenses................................................................................ 80 15.3. Indemnity............................................................................... 81
iv 15.4. Change in Accounting Principles......................................................... 82 15.5. Setoff.................................................................................. 82 15.6. Ratable Sharing......................................................................... 82 15.7. Amendments and Waivers.................................................................. 83 15.8. Notices................................................................................. 84 15.9. Survival of Warranties and Agreements................................................... 84 15.10. Failure or Indulgence Not Waiver; Remedies Cumulative................................... 85 15.11. Marshalling: Payments Set Aside......................................................... 85 15.12. Severability............................................................................ 85 15.13. Headings................................................................................ 85 15.14. Governing Law........................................................................... 85 15.15. Limitation of Liability................................................................. 85 15.16. Successors and Assigns.................................................................. 86 15.17. Submission to Jurisdiction.............................................................. 86 15.18. Counterparts; Effectiveness; Inconsistencies............................................ 86 15.19. Limitation on Agreements................................................................ 87 15.20. Confidentiality......................................................................... 87 15.21. Disclaimers............................................................................. 87 15.22. [Intentionally Omitted]................................................................. 88 15.23. Entire Agreement........................................................................ 88 15.24. No Third Party Beneficiaires............................................................ 88
v Schedules Schedule 1 -- Certain Construction Asset Values Schedule 7.1A -- Organizational Documents Schedule 7.1C -- Subsidiaries Schedule 7.1H -- Indebtedness Schedule 7.1I -- Litigation Schedule 7.1Q -- ERISA Plans Schedule 7.1T -- Insurance Schedule 10.12 -- Excluded Encumbrances Exhibits Exhibit A -- Assignment and Acceptance Exhibit B -- Note Exhibit C -- Notice of Conversion/Continuation Exhibit D -- List of Closing Documents Exhibit E -- Sample Covenant Calculations Exhibit F -- Non-Bank Certificate Exhibit G -- Guaranty vi This TERM LOAN AGREEMENT, dated as of July 31, 2000 (as the same may be amended, supplemented or modified from time to time, the "Agreement") is entered into among GGP LIMITED PARTNERSHIP, a Delaware limited partnership (the "Partnership"), GGPLP L.L.C., a Delaware limited liability company (the "Company;" the Partnership and the Company being referred to herein, individually and collectively, as the "Borrower"), the institutions from time to time parties hereto as Lenders, BANKERS TRUST COMPANY, a New York banking corporation ("Bankers Trust"), as a Lender and as administrative agent for the Lenders (in such capacity, the "Administrative Agent") and LEHMAN COMMERCIAL PAPER INC., a New York corporation ("Lehman"), as a Lender and as syndication agent for the Lenders (in such capacity, the "Syndication Agent") (the Administrative Agent and the Syndication Agent being referred to herein collectively as the "Co-Agents"). The parties hereto agree as follows: ARTICLE I DEFINITIONS 1.1. Certain Defined Terms. The following terms used in this Agreement shall have the following meanings, applicable both to the singular and the plural forms of the terms defined: "Adjusted EBITDA" means, with respect to any Property, for any period, an amount equal to (i) total revenues relating to such Property for such period, less (ii) the sum of total operating expenses relating to such Property for such period determined in accordance with GAAP (excluding any such expenses funded from the Capital Improvement Reserve) and the Capital Improvement Reserve for such period, plus (iii) to the extent subtracted pursuant to clause (ii) above, interest, income taxes (but not real estate taxes), depreciation, amortization and other non-cash charges determined in accordance with GAAP, which amount shall be adjusted for nonrecurring items such as sales of Properties or Minority Holdings and to eliminate the straight-lining of rents; provided, however, that for each Property which has been owned by the Borrower, a Consolidated Business or a Minority Holding or open for business for a period of less than one quarter, Adjusted EBITDA shall be calculated on a pro forma basis based on actual results. Adjusted EBITDA shall be determined by reference to the Borrower's statement of operations for the applicable period. Notwithstanding anything to the contrary contained herein, (1) Adjusted EBITDA shall not include any revenues generated by or allocable to any Property to the extent that the Investment in such Property constitutes an Event of Default or Potential Event of Default under Section 10.11 hereof; (2) Adjusted EBITDA shall not include any revenues generated by or allocable to any Real Estate Under Construction with respect to which the Borrower elects to include Construction Asset Cost in Capitalization Value; provided, however, that such revenues may be included to the extent that (A) the construction in question constitutes renovation or expansion of a Property that is otherwise completed, open for business and operational, (B) the construction in question will not materially interrupt, limit or impair such ongoing business and operations and (C) the inclusion of both such revenues in Adjusted EBITDA and such Construction Asset Cost in Capitalization Value 2 is not duplicative; and (3) the building located at 110 North Wacker Drive, Chicago, Illinois shall not be considered to be a Property for the purposes of this definition. "Administrative Agent" is defined in the preamble and includes Bankers Trust in its capacity as administrative agent for the Lenders and each successor administrative agent appointed in accordance with the terms of this Agreement. Affiliate" as applied to any Person, means any other Person that directly or indirectly controls, is controlled by, or is under common control with, that Person. For purposes of this definition, "control" (including, with correlative meanings, the terms "controlling", "controlled by" and "under common control with"), as applied to any Person, means the possession, directly or indirectly, of the power to vote fifteen percent (15.0%) or more of the equity Securities having voting power for the election of directors of such Person or otherwise to direct or cause the direction of the management and policies of that Person, whether through the ownership of voting equity Securities or by contract or otherwise. "Agreement" is defined in the preamble to this Agreement. "Annual EBITDA" means, with respect to any Property as of the first day of any calendar quarter: (i) for purposes of determining the Applicable Margin and the financial ratios described in Sections 10.12(b) and (e) hereof, Adjusted EBITDA for the immediately preceding consecutive four calendar quarters; provided, however, that for each Property which has been owned by the Borrower, a Consolidated Business or a Minority Holding or open for business for a period of less than one year, Annual EBITDA shall be calculated on the basis of Adjusted EBITDA determined as of the first day of each calendar quarter for such period or the immediately preceding consecutive one, two or three calendar quarters, as applicable with respect to the length of such ownership, for the period of the Borrower's ownership or since opening, annualized; and (ii) for all other purposes of this Agreement, the sum of (x) Adjusted EBITDA for the immediately preceding calendar quarter determined without regard to any percentage rent or temporary rent, annualized, plus (y) percentage rent and temporary rent for the immediately preceding consecutive four calendar quarters, adjusted for any Properties or Minority Holdings acquired, opened or sold during that period. Examples of the foregoing calculations are set forth on Exhibit E hereto. The building located at 110 North Wacker Drive, Chicago, Illinois shall not be considered to be a Property for the purposes of this definition. "Applicable Lending Office" means, with respect to a particular Lender, (i) its Eurodollar Lending Office in respect of provisions relating to Eurodollar Rate Loans, and (ii) its Domestic Lending Office in respect of provisions relating to Base Rate Loans. "Applicable Margin" means, with respect to each Loan, the respective percentages per annum determined, at any time, based on the range into which the Leverage Ratio then falls, in accordance with the following table. Any change in the Applicable Margin shall be effective as of the applicable financial reporting date set forth 3 in Section 8.2 hereof (exclusive of Section 8.2(b)(iv) hereof), and as of the date of the consummation and funding of each Capital Event. Applicable Margin (% per annum) Eurodollar Base Leverage Ratio Rate Loans Rate Loans - -------------- ---------- ---------- less than 50% 1.00% 0.00% 50% to less than 60% 1.35% 0.00% 60% or greater 1.70% 0.00% "Assignment and Acceptance" means an Assignment and Acceptance in substantially the form of Exhibit A attached hereto and made a part hereof (with blanks appropriately completed) delivered to the Administrative Agent in connection with an assignment of a Lender's interest under this Agreement in accordance with the provisions of Section 15.1. "Authorized Financial Officer" means a chief executive officer, chief financial officer, treasurer or other qualified senior officer acceptable to the Co-Agents. "Bankers Trust" is defined in the preamble to this Agreement. "Base Eurodollar Rate" means, with respect to any Eurodollar Interest Period applicable to a Borrowing of Eurodollar Rate Loans, an interest rate per annum displayed on the Rate Page for the purpose of displaying interest rates at which Dollar deposits are offered by major banks in the London interbank market as of 11:00 a.m., London time, on the applicable Eurodollar Interest Rate Determination Date, for deposits in Dollars, in immediately available funds, in an amount comparable to the amount of the applicable Eurodollar Rate Loan on such date, and for a duration comparable to the applicable Eurodollar Interest Period; provided, however, that if such rate does not appear on the Rate Page, the "Base Eurodollar Rate" applicable to a particular Eurodollar Interest Period shall mean a rate per annum equal to the rate at which Dollar deposits in an amount approximately equal to the principal balance (or the portion thereof which will bear interest at a rate determined by reference to the Base Eurodollar Rate during the Interest Period to which such Base Eurodollar Rate is applicable in accordance with the provisions hereof), and with maturities comparable to the last day of the Eurodollar Interest Period with respect to which such Base Eurodollar Rate is applicable, are offered in immediately available funds in the London Interbank Market to the London office of Bankers Trust by leading banks in the Eurodollar market at 11:00 a.m., London time, on the applicable Eurodollar Interest Rate Determination Date. "Base Rate" means, for any period, a fluctuating interest rate per annum as shall be in effect from time to time, which rate per annum shall at all times be equal to the higher of: 4 (i) the rate of interest announced publicly by Bankers Trust, from time to time, as Bankers Trust's reference rate; and (ii) the sum of (A) one-half of one percent (0.50%) per annum plus (B) the Federal Funds Rate in effect from time to time during such period. "Base Rate Loan" means (i) a Loan which bears interest at the Base Rate, or (ii) an overdue amount which was a Base Rate Loan immediately before it became due. "Benefit Plan" means a "defined benefit plan" as defined in Section 3(35) of ERISA and any other "pension plan" as defined in Section 3(2) of ERISA subject to Section 302 of ERISA (other than a Multiemployer Plan) in respect of which the Borrower or any ERISA Affiliate is, or within the immediately preceding six (6) years was, an "employer" as defined in Section 3(5) of ERISA or in respect of which the Borrower or any ERISA Affiliate has assumed any liability. "Borrower" is defined in the preamble to this Agreement. "Borrower Operating Agreement" means the Amended and Restated Operating Agreement of the Company dated May 25, 2000, as such agreement may be amended, restated, modified or supplemented from time to time with the consent of the Co-Agents or as permitted under Section 10.8. "Borrower Partnership Agreement" means the Second Amended and Restated Agreement of Limited Partnership of the Partnership dated April 1, 1998, as amended by the First Amendment thereto dated as of June 10, 1998, and the Second Amendment thereto dated as of June 29, 1998, as supplemented by the joinders of certain third parties as limited partners in the Partnership, as such agreement may be amended, restated, modified or supplemented from time to time with the consent of the Co-Agents or as permitted under Section 10.8. "Borrowing" means a borrowing consisting of Loans of the same type made, continued or converted on the same day. "Business Day" means a day, in the applicable local time, which is not a Saturday or Sunday or a legal holiday and on which banks are not required or permitted by law or other governmental action to close (i) in New York, New York, and (ii) in the case of Eurodollar Rate Loans, in London, England. "Capital Event" means any sale or issuance (or series of related sales or issuances) by GGP, Inc., the Borrower or any of its Subsidiaries of: (i) equity Securities representing interests in such entity that generates net proceeds in excess of $50,000,000; or (ii) debt Securities representing obligations of such entity (including, without limitation, any secured or unsecured financing or refinancing) that generates net proceeds in excess of $75,000,000. "Capital Expenditures" means, for any period, the aggregate of all expenditures (whether payable in cash or other Property or accrued as a liability (but without 5 duplication)) during such period that, in conformity with GAAP, are required to be included in or reflected by the Borrower's or any of its Subsidiaries' fixed asset accounts as reflected in any of their respective balance sheets; provided, however, (i) Capital Expenditures shall include, whether or not such a designation would be in conformity with GAAP, (a) that portion of Capital Leases which is capitalized on the Consolidated balance sheet of the Borrower and its Subsidiaries and (b) expenditures for Equipment which is purchased simultaneously with the trade-in of existing Equipment owned by the Borrower or any of its Subsidiaries, to the extent the gross purchase price of the purchased Equipment exceeds the book value of the Equipment being traded in at such time; and (ii) Capital Expenditures shall exclude, whether or not such a designation would be in conformity with GAAP, expenditures made in connection with the restoration of Property, to the extent reimbursed or financed from insurance or condemnation proceeds. Notwithstanding the foregoing, Capital Expenditures shall not include Construction Asset Cost or costs associated with the renovation of an individual Property in excess of $5,000,000. "Capital Improvement Reserve" means $0.25 per annum per square foot of mall store gross leaseable area in the Real Properties and in that portion of real property owned by Minority Holdings allocable, on a pro rata basis, to the Borrower or any of its Subsidiaries. "Capitalization Value" means the sum of (i) the Combined EBITDA for the applicable period divided by 8.25%, (ii) Cash and Cash Equivalents, (iii) Inactive Assets, other than Construction Assets, at the lesser of cost or fair market value and (iv) Construction Asset Cost; provided, however, that Capitalization Value shall include Inactive Assets and Construction Asset Cost only to the extent that Inactive Assets and Construction Asset Cost do not exceed, in the aggregate, eight percent (8%) of Capitalization Value; provided, further, that for purposes of determining Capitalization Value only, "Construction Asset Cost" shall mean, with respect to the land portion of the Construction Assets set forth on Schedule 1, instead of acquisition cost, the values of the land portion of such Construction Assets as set forth on such Schedule 1; provided, further, that Capitalization Value shall not include any Inactive Asset or Construction Asset Cost incurred with respect to any Construction Asset to the extent the incurrence of such Construction Asset Cost or the Investment in such Inactive Asset or Construction Asset constitutes an Event of Default or Potential Event of Default under Section 10.11 hereof; and provided, further, that Capitalization Value shall not include Construction Asset Cost as to any Real Estate Under Construction with respect to which the Borrower elects to include revenues in Adjusted EBITDA, provided, however, that such Construction Asset Cost may be included to the extent that (A) the construction in question constitutes renovation or expansion of a Property that is otherwise completed, open for business and operational, (B) the construction in question will not materially interrupt, limit or impair such ongoing business and operations and (C) the inclusion of both such revenues in Adjusted EBITDA and such Construction Asset Cost in Capitalization Value is not duplicative. 6 "Capital Lease" means any lease of any property (whether real, personal or mixed) by a Person as lessee which, in conformity with GAAP, is accounted for as a capital lease on the balance sheet of that Person. "Capital Stock" means, with respect to any Person, any capital stock of such Person, regardless of class or designation, and all warrants, options, purchase rights, conversion or exchange rights, voting rights, calls or claims of any character with respect thereto. "Cash and Cash Equivalents" means (i) unrestricted cash, (ii) unrestricted marketable direct obligations issued or unconditionally guaranteed by the United States government and backed by the full faith and credit of the United States government; and (iii) unrestricted domestic and Eurodollar certificates of deposit and time deposits, bankers' acceptances and floating rate certificates of deposit issued by any commercial bank organized under the laws of the United States, any state thereof, the District of Columbia, any foreign bank, or its branches or agencies (fully protected against currency fluctuations), which, at the time of acquisition, are rated A1 (or better) by S&P or P1 (or better) by Moody's; provided, however, that the maturities of such Cash and Cash Equivalents shall not exceed one year. "CERCLA" means the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. ss.ss. 9601 et seq., any amendments thereto, any successor statutes, and any regulations or guidance having the force of law promulgated thereunder. "Change of Control" means that (i) more than two of Matthew Bucksbaum, John Bucksbaum, Robert Michaels, Bernard Freibaum and Jon Batesole, or any replacement for any of the foregoing Persons approved by the Requisite Lenders pursuant to clause (ii) below, cease to be senior officers primarily responsible for the day-to-day management and operation of GGP, Inc., and (ii) if the circumstances described in clause (i) above shall occur, the senior management positions of the foregoing Persons who cease to be senior officers as aforesaid are not filled within 180 days after the vacancy in such positions arise with replacements approved by the Requisite Lenders. "Claim" means any claim or demand, by any Person, of whatsoever kind or nature for any alleged Liabilities and Costs, whether based in contract, tort, implied or express warranty, strict liability, criminal or civil statute, Permit, ordinance or regulation, common law or otherwise. "Closing Date" means July 31, 2000. "Co-Agents" is defined in the preamble to this Agreement. "Combined EBITDA" means the sum of (i) 100% of the Annual EBITDA of the Borrower and its wholly-owned Subsidiaries with respect to Properties wholly-owned by the Borrower or any such Subsidiary; and (ii) the portion of the Annual EBITDA of the Minority Holdings allocable to the Borrower and the Management Company in accordance with GAAP; provided, however, that Combined EBITDA shall include 7 Annual EBITDA allocable to the Management Company only to the extent that Annual EBITDA allocable to the Management Company does not exceed four percent (4%) of Combined EBITDA. "Combined Equity Value" means Capitalization Value minus Total Adjusted Outstanding Indebtedness. "Combined Interest Expense" means, for any period, the sum of (i) interest expense of GGP, Inc. and the Consolidated Businesses paid during such period and (ii) interest expense of GGP, Inc. and the Consolidated Businesses accrued for such period to the extent not paid during such period, and (iii) the portion of the interest expense of Minority Holdings allocable to GGP, Inc. or the Borrower in accordance with GAAP and paid during such period, and (iv) the portion of the interest expense of Minority Holdings allocable to the Borrower in accordance with GAAP and accrued for such period, to the extent not paid during such period, in each case including participating interest expense but excluding extraordinary interest expense and prepayment fees, premiums or penalties and net of amortization of deferred costs associated with new financings or refinancings of existing Indebtedness; provided, however, that with respect to Properties that GGP, Inc., the Borrower, a Consolidated Business or a Minority Holding has owned for less than one year and which is included in the calculation of Annual EBITDA, the interest expense with respect thereto (including interest expense incurred in connection with any Loans made in connection with the acquisition of such Property or in connection with any mortgage loans entered into or assumed in connection therewith) shall be determined as of the first day of each fiscal quarter for the immediately preceding consecutive one, two or three fiscal quarters, as applicable with respect to the period such Property has been owned by the Borrower, a Consolidated Business or a Minority Holding, annualized. "Commission" means the Securities and Exchange Commission and any Person succeeding to the functions thereof. "Compliance Certificate" is defined in Section 8.2(b)(iii). "Consolidated" means consolidated in accordance with GAAP. "Consolidated Businesses" means the Borrower and its respective wholly-owned Subsidiaries. "Construction Asset" means any Property which is raw land, vacant out-parcels or Real Estate Under Construction. "Construction Asset Cost" means, with respect to all Construction Assets, the aggregate sums expended on the construction of such improvements (including land acquisition costs). "Contaminant" means any waste, pollutant, hazardous substance, toxic substance, hazardous waste, special waste, petroleum or petroleum-derived substance or waste, radioactive materials, asbestos (in any form or condition), polychlorinated biphenyls (PCBs), or any constituent of any such substance or waste, and includes, but is not 8 limited to, these terms as defined in federal, state or local laws or regulations; provided, however, that "Contaminant" shall not include the foregoing items to the extent (i) the same exist on the applicable Property in negligible or customary amounts and are stored and used in accordance with all Environmental, Health or Safety Requirements of Law or (ii) are used in connection with a tire or battery retail store provided the same are stored, sold and used in accordance with all Environmental, Health or Safety Requirements of Law. "Contingent Obligation" as to any Person means, without duplication, (i) any contingent obligation of such Person required to be shown on such Person's balance sheet in accordance with GAAP, and (ii) any obligation required to be disclosed in the footnotes to such Person's financial statements in accordance with GAAP, guaranteeing partially or in whole any Non-Recourse Indebtedness, lease, dividend or other obligation, exclusive of (A) contractual indemnities (including, without limitation, any indemnity or price-adjustment provision relating to the purchase or sale of Securities or other assets) and (B) guarantees of non-monetary obligations (other than guarantees of completion) which have not yet been called on or quantified, of such Person or of any other Person. The amount of any Contingent Obligation described in clause (ii) shall be deemed to be (a) with respect to a guaranty of interest or interest and principal, or operating income guaranty, the sum of all payments required to be made thereunder (which in the case of an operating income guaranty shall be deemed to be equal to the debt service for the note secured thereby), calculated at the interest rate applicable to such Indebtedness, through (i) in the case of an interest or interest and principal guaranty, the stated date of maturity of the obligation (and commencing on the date interest could first be payable thereunder), or (ii) in the case of an operating income guaranty, the date through which such guaranty will remain in effect, and (b) with respect to all guarantees not covered by the preceding clause (a) an amount equal to the stated or determinable amount of the primary obligation in respect of which such guaranty is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder) as recorded on the balance sheet and on the footnotes to the most recent financial statements of the applicable Borrower required to be delivered pursuant hereto. Notwithstanding anything contained herein to the contrary, guarantees of completion or other performance shall not be deemed to be Contingent Obligations unless and until a claim for payment has been made thereunder, at which time any such guaranty of completion or other performance shall be deemed to be a Contingent Obligation in an amount equal to any such claim. Subject to the preceding sentence, (i) in the case of a joint and several guaranty given by such Person and another Person (but only to the extent such guaranty is Recourse Indebtedness, directly or indirectly to the applicable Borrower), the amount of the guaranty shall be deemed to be 100% thereof unless and only to the extent that (X) such other Person has delivered Cash or Cash Equivalents to secure all or any part of such Person's obligations under such joint and several guaranty or (Y) such other Person holds an Investment Grade Credit Rating from either Moody's or S&P or has creditworthiness otherwise reasonably acceptable to the Co-Agents, and (ii) in the case of a guaranty (whether or not joint and several) of an obligation otherwise constituting Indebtedness of such Person, the amount of such guaranty shall be deemed to be only that amount in excess of the amount of the obligation constituting Indebtedness of such Person. Notwithstanding anything contained herein to the contrary, "Contingent 9 Obligations" shall not be deemed to include guarantees of loan commitments or of construction loans to the extent the same have not been drawn. "Contractual Obligation" means, as applied to any Person, any provision of any Securities issued by that Person or any Organizational Document, indenture, mortgage, deed of trust, security agreement, pledge agreement, guaranty, contract, undertaking, agreement or instrument to which that Person is a party or by which it or any of its properties is bound, or to which it or any of its properties is subject. "Credit Rating" means the publicly announced rating of a Person given by Moody's or S&P. "Customary Permitted Liens" means (a) Liens (other than Environmental Liens and Liens in favor of the PBGC) with respect to the payment of taxes, assessments or utility or governmental charges in all cases which are not yet due or which are being contested in good faith by appropriate proceedings in accordance with Section 9.4 and with respect to which adequate reserves or other appropriate provisions are being maintained in accordance with GAAP; (b) Statutory Liens of landlords or Equipment lessors against any Property of the Borrower or any of its Subsidiaries and Liens against any Property of the Borrower or any of its Subsidiaries in favor of suppliers, mechanics, carriers, materialmen, warehousemen or workmen and other Liens against any Property of the Borrower or any of its Subsidiaries imposed by law created in the ordinary course of business for amounts which, if not resolved in favor of the Borrower or such Subsidiary, would not, individually or in the aggregate, be likely to result in a Material Adverse Effect; (c) Liens (other than any Lien in favor of the PBGC) incurred or deposits made in the ordinary course of business in connection with workers' compensation, unemployment insurance or other types of social security benefits or to secure the performance of bids, tenders, sales, contracts (other than for the repayment of borrowed money), surety, appeal and performance bonds; provided that (A) all such Liens do not in the aggregate materially detract from the value of the Borrower's (if such Liens are against Property of Borrower) or a Subsidiary's assets or Property or materially impair the use thereof in the operation of their respective businesses, and (B) all Liens of attachment or judgment and Liens securing bonds to stay judgments or in connection with appeals do not secure at any time an aggregate amount of Recourse Indebtedness exceeding $5,000,000 with respect to the Borrower and its Subsidiaries; and (d) Liens against any Property of the Borrower or any Subsidiary of the Borrower arising with respect to zoning restrictions, easements, operating agreements, licenses, reservations, covenants, rights-of- way, utility easements, building restrictions and other similar charges or encumbrances on the use of Real Property which do not interfere with the ordinary conduct of the business of the Borrower or any of its Subsidiaries or materially affect the value thereof or, taken together, to the extent they would not be likely to result in a Material Adverse Effect. 10 "Documentation Agent" means any Lender appointed as documentation agent under this Agreement, in its capacity as documentation agent for the Lenders and each successor documentation agent appointed in accordance with the terms of this Agreement. "DOL" means the United States Department of Labor and any Person succeeding to the functions thereof. "Dollars" and "$" mean the lawful money of the United States. "Domestic Lending Office" means, with respect to any Lender, such Lender's office, located in the United States, specified as the "Domestic Lending Office" under its name on the signature pages hereof or on the Assignment and Acceptance or the joinder agreement executed pursuant to Section 3.2 hereof by which it became a Lender or such other United States office of such Lender as it may from time to time specify by written notice to the Borrower and the Administrative Agent. "Eligible Assignee" means (i) a Lender, Hypo-und Vereinsbank, or any Affiliate thereof; (ii) a commercial bank having total assets in excess of $5,000,000,000; (iii) the central bank of any country which is a member of the Organization for Economic Cooperation and Development; or (iv) a finance company or other financial institution reasonably acceptable to the Co-Agents, which is regularly engaged in making, purchasing or investing in loans and having total assets in excess of $500,000,000 or is otherwise acceptable to the Co-Agents and in each case when an Event of Default does not exist and other than in the case of clause (i) above, reasonably acceptable to the Borrower. "Environmental, Health or Safety Requirements of Law" means all Requirements of Law derived from or relating to any federal, state or local law (including common law), ordinance, rule, regulation, Permit, license or other binding determination of any Governmental Authority relating to, imposing liability or standards concerning, or otherwise addressing the environment, health and/or safety, including, but not limited to the Clean Air Act, the Clean Water Act, CERCLA, RCRA, any so-called "Superfund" or "Superlien" law, the Toxic Substances Control Act and OSHA, and public health codes, each as from time to time in effect, in each case as applicable to the Borrower, any of its Subsidiaries or a Property. "Environmental Lien" means a Lien in favor of any Governmental Authority for any (i) liabilities under any Environmental, Health or Safety Requirement of Law, or (ii) damages arising from, or costs incurred by such Governmental Authority in response to, a Release or threatened Release of a Contaminant into the environment. "Environmental Property Transfer Act" means any applicable Requirement of Law that conditions, restricts, prohibits or requires any notification or disclosure triggered by the transfer (including a transfer of direct or indirect equity or debt interests), sale, lease or closure of any Property or deed or title for any Property for environmental 11 reasons, including, but not limited to, any so-called "Environmental Cleanup Responsibility Act" or "Responsible Property Transfer Act". "Equipment" means equipment which is personal property used in connection with the maintenance of any Property. "ERISA" means the Employee Retirement Income Security Act of 1974, 29 U.S.C.ss.ss.1000 et seq., any amendments thereto, any successor statutes, and any regulations or guidance having the force of law promulgated thereunder. "ERISA Affiliate" means (i) any corporation which is a member of the same controlled group of corporations (within the meaning of Section 414(b) of the Internal Revenue Code) as the Borrower; (ii) a partnership or other trade or business (whether or not incorporated) which is under common control (within the meaning of Section 414(c) of the Internal Revenue Code) with the Borrower; and (iii) a member of the same affiliated service group (within the meaning of Section 414(m) of the Internal Revenue Code) as the Borrower, any corporation described in clause (i) above or any partnership or trade or business described in clause (ii) above. "ERISA Termination Event" means (i) a Reportable Event with respect to any Benefit Plan; (ii) the withdrawal of the Borrower or any ERISA Affiliate from a Benefit Plan during a plan year in which the Borrower or such ERISA Affiliate was a "substantial employer" as defined in Section 4001(a)(2) of ERISA or the cessation of operations which results in the termination of employment of twenty percent (20%) of Benefit Plan participants who are employees of the Borrower or any ERISA Affiliate; (iii) the imposition of an obligation on the Borrower or any ERISA Affiliate under Section 4041 of ERISA to provide affected parties written notice of intent to terminate a Benefit Plan in a distress termination described in Section 4041(c) of ERISA; (iv) the institution by the PBGC of proceedings to terminate a Benefit Plan; (v) any event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Benefit Plan; (vi) any event or condition which results in material liability to the Borrower under Section 4069 of ERISA; (vii) the partial or complete withdrawal of the Borrower or any ERISA Affiliate from a Multiemployer Plan; or (viii) any other event or condition shall occur or exist with respect to a Plan, and in each such case in clauses (i) through (vii) above, such event or condition together with all other events or conditions with respect to a Plan, if any, could, in the reasonable judgment of the Co-Agents, reasonably be expected to have a Material Adverse Effect. "Eurodollar Affiliate" means, with respect to each Lender, the Affiliate of such Lender (if any) set forth below such Lender's name under the heading "Eurodollar Affiliate" on the signature pages hereof or on the Assignment and Acceptance or the joinder agreement executed pursuant to Section 3.2 hereof by which it became a Lender or such Affiliate of a Lender as it may from time to time specify by written notice to the Borrower and the Administrative Agent. "Eurodollar Interest Period" is defined in Section 5.2(b). 12 "Eurodollar Interest Rate Determination Date" is defined in Section 5.2(c). "Eurodollar Lending Office" means, with respect to any Lender, such Lender's office (if any) specified as the "Eurodollar Lending Office" under its name on the signature pages hereof or on the Assignment and Acceptance or the joinder agreement executed pursuant to Section 3.2 hereof by which it became a Lender or such other office or offices of such Lender as it may from time to time specify by written notice to the Borrower and the Administrative Agent. "Eurodollar Rate" means, with respect to any Eurodollar Interest Period applicable to a Eurodollar Rate Loan, an interest rate per annum obtained by dividing (i) the Base Eurodollar Rate applicable to that Eurodollar Interest Period by (ii) a percentage, calculated for each Lender in respect of the Loans made by it, equal to 100% minus the Eurodollar Reserve Percentage in effect as to such Lender, if any, on the relevant Eurodollar Interest Rate Determination Date. "Eurodollar Rate Loan" means (i) a Loan which bears interest at a rate determined by reference to the Eurodollar Rate and the Applicable Margin for Eurodollar Rate Loans, as provided in Section 5.1(a) or (ii) an overdue amount which was a Eurodollar Rate Loan immediately before it became due. "Eurodollar Reserve Percentage" means the total of the maximum reserve percentages for determining the reserves to be maintained by member banks of the Federal Reserve System for Eurocurrency Liabilities, as defined in Federal Reserve Board Regulation D. The Eurodollar Reserve Percentage shall be expressed in decimal form and rounded upward, if necessary, to the nearest 1/100th of one percent, and shall include marginal, emergency, supplemental, special and other reserve percentages. "Event of Default" means any of the occurrences set forth in Section 11.1 after the expiration of any applicable grace period and the giving of any applicable notice, in each case as expressly provided in Section 11.1. "External Revenues" means all the excess of (i) gross revenues realized by GGP, Inc., the Consolidated Businesses and, to the extent allocable to the Consolidated Businesses, in accordance with GAAP, the Minority Holdings, excluding only revenues realized in the ordinary course of business, but including, without limitation, proceeds of any sales of Properties, financings or refinancings of Properties, whether secured or unsecured, or sales or issuance of any Securities representing equity interests in or obligations of such entity, over (ii) the sum of (A) the reasonable and customary out-of-pocket costs, fees and expenses paid or incurred by GGP, Inc., the Consolidated Businesses and, to the extent allocable to the Consolidated Businesses, in accordance with GAAP, the Minority Holdings, in connection with the transactions or other proceedings from which such revenues were realized; (B) the amount of such proceeds applied to repay Indebtedness secured by or otherwise directly related to the Property sold, financed or refinanced; and (C) the amount of such proceeds used to acquire Property (other than Real Property) in replacement or substitution of Property (other than Real Property) so sold. 13 "Federal Funds Rate" means, for any period, a fluctuating interest rate per annum equal for each day during such period to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published for such day (or, if such day is not a Business Day in New York, New York, for the next preceding Business Day) in New York, New York by the Federal Reserve Bank of New York, or if such rate is not so published for any day which is a Business Day in New York, New York, the average of the quotations for such day on transactions by the Reference Bank, as reasonably determined by the Administrative Agent. "Federal Reserve Board" means the Board of Governors of the Federal Reserve System or any Governmental Authority succeeding to its functions. "FFO" means net income, as determined in accordance with GAAP, excluding gains (or losses) from debt restructuring and sales of property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures (which will be calculated to reflect funds from operations on the same basis). "Financial Statements" means (i) quarterly and annual Consolidated statements of income and retained earnings, statements of cash flow, and balance sheets, (ii) such other financial statements as GGP, Inc. and the Borrower shall routinely and regularly prepare on a quarterly or annual basis, and (iii) such other regularly prepared financial statements of the Consolidated Businesses or Minority Holdings as the Co-Agents or the Requisite Lenders may from time to time reasonably specify; provided, however, that the Financial Statements referenced in clauses (i) and (ii) above shall be prepared in form satisfactory to the Co-Agents. "Fiscal Year" means the fiscal year of the Borrower or GGP, Inc., as applicable, for accounting and tax purposes, which shall be the 12-month period ending on December 31 of each calendar year. "Fixed Charges" means, as of the first day of each fiscal quarter for the immediately preceding consecutive four fiscal quarters, the sum of (a) Combined Interest Expense and (b) the aggregate of all scheduled principal payments on Total Adjusted Outstanding Indebtedness according to GAAP made or required to be made during such fiscal period for the Consolidated Businesses and Minority Holdings (but excluding balloon payments of principal due upon the stated maturity of an Indebtedness), and (c) the aggregate of all dividends payable on the preferred stock of GGP, Inc. and the Consolidated Businesses not owned by the Borrower or any of its Affiliates. "Funding Date" means any date on which a Loan under this Agreement is made by the Lenders to the Borrower. "GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the American Institute of Certified Public Accountants' Accounting Principles Board and Financial Accounting Standards Board or in such other statements by such other entity as may be in general use by significant segments of the 14 accounting profession as in effect on the Closing Date (unless otherwise specified herein as in effect on another date or dates). "GGP, Inc." means General Growth Properties, Inc., a Delaware corporation and the general partner of the Partnership. "Governmental Approval" means all right, title and interest in any existing or future certificates, licenses, permits, variances, authorizations and approvals issued by any Governmental Authority having jurisdiction with respect to any Property. "Governmental Authority" means any nation or government, any federal, state, local or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government. "Guaranty" means that certain Guaranty, substantially in the form attached as Exhibit G, made by GGP, Inc. in favor of the Administrative Agent guaranteeing the payment and performance of the Obligations. "Holder" means any Person entitled to enforce any of the Obligations, whether or not such Person holds any evidence of Indebtedness, including, without limitation, the Co-Agents and each Lender. "Homart Portfolio" means the portfolio of Properties commonly described by the Borrower as GGP/Homart and GGP/Homart II and their Subsidiaries and Investments. "Improvements" means, with respect to any Real Property, all buildings, fixtures, structures, parking areas, landscaping and all other improvements whether existing now or hereafter constructed, together with all machinery and mechanical, electrical, HVAC and plumbing systems presently or hereafter located thereon and used in the operation thereof, excluding (a) any such items owned by utility service providers, (b) any such items owned by tenants or other third-parties and (c) any items of personal property. "Inactive Assets" means Construction Assets (other than Real Estate Under Construction), loans receivable (including, without limitation, purchase money and other mortgage loans), and other miscellaneous Property not described in any of clauses (A) through (D) of Section 10.11(iv) hereof. "Indebtedness" as applied to any Person, means, at any time, without duplication, (a) all indebtedness, obligations or other liabilities of such Person (whether consolidated or representing the proportionate interest in any other Person) (i) for borrowed money (including construction loans) or evidenced by debt securities, debentures, acceptances, notes or other similar instruments, and any accrued interest, fees and charges relating thereto, (ii) under profit payment agreements or in respect of obligations to redeem, repurchase or exchange any Securities issued by such Person or to pay dividends in respect of any stock, (iii) with respect to letters of credit issued for such Person's account, (iv) to pay the deferred purchase price of property or services, except accounts payable and accrued expenses arising in the ordinary course of business, (v) in respect of Capital 15 Leases, (vi) which are Contingent Obligations, (vii) under warranties and indemnities or (viii) for the payment of taxes, levies or other obligations which then are past due and payable to any Governmental Authority; (b) all indebtedness, obligations or other liabilities of such Person or others secured by a Lien on any property of such Person, whether or not such indebtedness, obligations or liabilities are assumed by such Person, all as of such time; (c) all indebtedness, obligations or other liabilities of such Person in respect of interest rate contracts and foreign exchange contracts, net of liabilities owed to such Person by the counterparties thereon; (d) all preferred stock or other Securities subject (upon the occurrence of any contingency or otherwise) to mandatory redemption by such Person; (e) all indebtedness, obligations or other liabilities of such Person in respect of forward equity sales and similar purchase obligations, and (f) all contingent Contractual Obligations with respect to any of the foregoing. "Indemnified Matters" is defined in Section 15.3. "Indemnitees" is defined in Section 15.3. "Initial Funding Date" means the date on or after the Closing Date, on which all of the conditions described in Section 6.1 have been satisfied (or waived) in a manner satisfactory to the Co-Agents and the Lenders and on which Loans under this Agreement are made by the Lenders to the Borrower. "Internal Revenue Code" means the Internal Revenue Code of 1986, as amended to the date hereof and from time to time hereafter, any successor statute and any regulations or guidance having the force of law promulgated thereunder. "Investment" means, with respect to any Person, (i) any purchase or other acquisition by that Person of any Property including, without limitation, Securities, or of a beneficial interest in Securities, issued by any other Person, (ii) any purchase by that Person of all or substantially all of the assets of a business conducted by another Person, and (iii) any loan, advance (other than deposits with financial institutions available for withdrawal on demand, prepaid expenses, accounts receivable, advances to employees and similar items made or incurred in the ordinary course of business) or capital contribution by that Person to any other Person, including all Indebtedness to such Person arising from a sale of property by such Person other than in the ordinary course of its business. The amount of any Investment shall be the original cost of such Investment, plus the cost of all additions thereto less the amount of any return of capital or principal to the extent such return is in cash with respect to such Investment without any adjustments for increases or decreases in value or write-ups, write-downs or write-offs with respect to such Investment. "Investment Grade" means (i) with respect to Moody's a Credit Rating of Baa3 or higher and (ii) with respect to S&P, a Credit Rating of BBB- or higher. "IRS" means the Internal Revenue Service and any Person succeeding to the functions thereof. 16 "Ivanhoe Portfolio" means the portfolio of Properties commonly described by the Borrower as GGP/Ivanhoe, GGP/Ivanhoe II and GGP/Ivanhoe III and their Subsidiaries and Investments. "Knowledge" with reference to any Person, means the actual knowledge of an officer of such Person after reasonable inquiry (which reasonable inquiry shall include, without limitation, interviewing and questioning such other Persons as such Person deems reasonably necessary). "Lease" means a lease, license, concession agreement or other agreement providing for the use or occupancy of any portion of any Property, including all amendments, supplements, modifications and assignments thereof and all side letters or side agreements relating thereto. "Lehman" is defined in the preamble to this Agreement. "Lender" means each financial institution which is a party hereto as a Lender, whether as a signatory hereto, pursuant to an Assignment and Acceptance or pursuant to a joinder agreement executed and delivered in accordance with Section 3.2 hereof. "Leverage Ratio" means the ratio, expressed as a percentage, of the Total Adjusted Outstanding Indebtedness to the Capitalization Value. "Liabilities and Costs" means all liabilities, obligations, responsibilities, losses, damages, personal injury, death, punitive damages, economic damages, consequential damages, treble damages, intentional, willful or wanton injury, damage or threat to the environment, natural resources or public health or welfare, costs and expenses (including, without limitation, attorney, expert and consulting fees and costs of investigation, feasibility or Remedial Action studies), fines, penalties and monetary sanctions, interest, direct or indirect, known or unknown, absolute or contingent, past, present or future. "Lien" means any mortgage, deed of trust, pledge, hypothecation, assignment, conditional sale agreement, deposit arrangement, security interest, encumbrance, lien (statutory or other and including, without limitation, any Environmental Lien), preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever in respect of any property of a Person, whether granted voluntarily or imposed by law, and includes the interest of a lessor under a Capital Lease or under any financing lease having substantially the same economic effect as any of the foregoing and the filing of any financing statement or similar notice (other than a financing statement filed by a "true" lessor pursuant to ss. 9-408 of the Uniform Commercial Code), naming the owner of such property as debtor, under the Uniform Commercial Code or other comparable law of any jurisdiction. "Limited Minority Holdings" means Minority Holdings in which (i) the Borrower or GGP, Inc. has a less than fifty percent (50%) ownership interest or (ii) the Borrower or GGP, Inc. does not control the management of such Minority Holdings, whether as the general partner or managing member of such Minority Holding, or otherwise or (iii) the Borrower or GGP, Inc. does not control decisions with respect to the financing or sale or 17 other disposition of the assets thereof. As used in this definition only, the term "control" shall mean the authority to make major management decisions or the management of day-to-day operations of such entity and shall include instances in which the Management Company manages the day-to-day leasing, management, control or development of the Properties of such Minority Holding pursuant to the terms of a management agreement. "Loan" means a loan made by a Lender pursuant to Section 2.1 or Article III; provided, that if any such loan or loans (or portions thereof) are combined or subdivided pursuant to a Notice of Conversion/Continuation under Section 4.1, the term "Loan" shall refer to the combined principal amount resulting from such combination or to each of the separate principal amounts resulting from such subdivision, as the case may be. "Loan Account" is defined in Section 4.3(b). "Loan Commitment" means, with respect to any Lender, the obligation of such Lender to make Loans pursuant to the terms and conditions of this Agreement, and which shall not exceed the principal amount set forth opposite such Lender's name under the heading "Loan Commitment" on the signature pages hereof or the signature page of the joinder agreement pursuant to Section 3.2 by which it became a Lender, as modified from time to time pursuant to the terms of this Agreement or to give effect to any applicable joinder agreement pursuant to Section 3.2, and "Loan Commitments" means the aggregate principal amount of the Loan Commitments of all the Lenders, which shall initially be $100,000,000. "Loan Documents" means this Agreement, the Notes, the Guaranty and all other instruments, agreements and written Contractual Obligations between the Borrower and any of the Lenders pursuant to or in connection with the transactions contemplated hereby. "Loan Obligations" means, at any particular time, the sum of the outstanding principal amount of the Loans of all Lenders at such time. "Loan-to-Value Ratio" means, with respect to all Indebtedness for borrowed money directly related to any Property or asset (including, without limitation, Indebtedness secured by a Lien thereon or on the equity interests in the entity owning such Property or incurred to finance any construction thereon) the ratio (expressed as a percentage) of: (i) the amount of such Indebtedness; to (ii) the Capitalization Value attributable to such Property or asset. "Management Company" means General Growth Management, Inc., a Delaware corporation and its Subsidiaries, its successors or assigns, so long as it is an Affiliate of GGP, Inc. "Margin Stock" means "margin stock" as such term is defined in Regulation U. "Material Adverse Effect" means a material adverse effect upon (i) the financial condition or assets of GGP, Inc., the Borrower and its Subsidiaries taken as a whole, (ii) 18 the ability of GGP, Inc. or the Borrower to perform their respective obligations under the Loan Documents, or (iii) the ability of the Lenders or the Administrative Agent to enforce any of the Loan Documents. "Maturity Date" means July 31, 2003 (or, if not a Business Day, the next preceding Business Day). "Maximum Aggregate Loan Amount" means $100,000,000, subject to increase in accordance with Article III hereof. "Minority Holdings" means partnerships, joint ventures, trusts, limited liability companies and corporations held or owned by the Borrower, GGP, Inc. or the Management Company, which are not wholly-owned by the Borrower, GGP, Inc. or the Management Company. "Moody's" means Moody's Investor Services, Inc. "Multiemployer Plan" means a "multiemployer plan" as defined in Section 3(37) of ERISA which is, or within the immediately preceding six (6) years was, contributed to by either the Borrower or any ERISA Affiliate or in respect of which the Borrower or any ERISA Affiliate has assumed any liability. "Non-Recourse Indebtedness" means Indebtedness which is not Recourse Indebtedness. "Note" means a promissory note substantially in the form attached hereto as Exhibit B payable to a Lender, in form and substance acceptable to the Administrative Agent and such Lender, evidencing certain of the joint and several Obligations of and executed by the Borrower as required by Section 4.3(a), as well as any such other promissory note as is necessary to evidence the Loans owing to a Lender after giving effect to any Assignment and Acceptance pursuant to Section 15.1 or joinder agreement pursuant to Section 3.2 which is in form and substance acceptable to the Administrative Agent and the parties to such Assignment and Acceptance or joinder agreement, as applicable. All such promissory notes, as the same may be amended, supplemented, modified or restated from time to time and all replacements thereof and substitutions therefor are collectively referred to herein as the "Notes". "Notice of Conversion/Continuation" means a notice substantially in the form of Exhibit C attached hereto and made a part hereof with respect to a proposed conversion or continuation of a Loan pursuant to Section 5.1(c). "Obligations" means all Loans, advances, debts, liabilities, obligations, covenants and duties owing by the Borrower to the Co-Agents, any other Lender, any Affiliate of the Co-Agents or any Lender, or any Person entitled to indemnification pursuant to Section 15.3 of this Agreement, of any kind or nature, arising under this Agreement, the Notes or any other Loan Document. The term includes, without limitation, all interest (including, without limitation, interest, fees and expenses accruing after the maturity of the Loans and interest, fees and expenses accruing after the filing of any petition in 19 bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to the Borrower, whether or not a claim for post-filing or post-petition interest, fees and expenses is allowed in such proceeding), charges, expenses, fees, reasonable attorneys' fees and disbursements and any other sum chargeable to the Borrower under this Agreement or any other Loan Document. "Officer's Certificate" means, (a) as to a corporation, a certificate executed on behalf of such corporation by the chairman of its board of directors (if an officer of such corporation) or its chief executive officer, president, any of its vice-presidents, its chief financial officer, or its treasurer, (b) as to a partnership, a certificate executed on behalf of such partnership by the chairman of the board of directors (if an officer of such corporation) or chief executive officer, president, any vice-president, or treasurer of the general partner of such partnership and (c) as to a limited liability company, a certificate executed on behalf of such limited liability company by the chairman of the board of directors (if an officer of such corporation) or chief executive officer, president, any vice-president, or treasurer of the managing member of such limited liability company. "Organizational Documents" means, with respect to any corporation, limited liability company, trust or partnership (i) the articles/certificate of incorporation, formation or limited partnership (or the equivalent organizational documents) of such corporation or limited liability company or trust or limited partnership, (ii) the partnership agreement, operating agreement or trust agreement executed by the partners in the partnership, the members in the limited liability company or governing the trust, (iii) the bylaws (or the equivalent governing documents) of the corporation, limited liability company, trust or partnership, and (iv) any document setting forth the designation, amount and/or relative rights, limitations and preferences of any class or series of such corporation's Capital Stock or such limited liability company's, partnership's or trust's equity, ownership or beneficial interests. "OSHA" means the Occupational Safety and Health Act of 1970, 29 U.S.C.ss.ss.651 et seq., any amendments thereto, any successor statutes and any regulations or guidance having the force of law promulgated thereunder. "Partnership" is defined in the preamble to this Agreement. "PBGC" means the Pension Benefit Guaranty Corporation and any Person succeeding to the functions thereof. "Permits" means any permit, consent, approval, authorization, license, variance, or permission required from any Person, including any Governmental Approvals. "Person" means any natural person, corporation, limited liability company, limited partnership, general partnership, joint stock company, joint venture, association, company, trust, bank, trust company, land trust, business trust or other organization, whether or not a legal entity, and any Governmental Authority. "Plan" means an "employee benefit" plan defined in Section 3(3) of ERISA in respect of which the Borrower or any ERISA Affiliate is, or within the immediately 20 preceding six (6) years was, an "employer" as defined in Section 3(5) of ERISA or the Borrower or any ERISA Affiliate has assumed any liability. "Potential Event of Default" means an event which, with the giving of notice or the lapse of time, or both, would constitute an Event of Default. "Prepayment Date" is defined in Section 4.1(d)(i). "Property" means any Real Property or personal property, plant, building, facility, structure, underground storage tank or unit, equipment, general intangible, receivable, or other asset owned, leased or operated by any Consolidated Business or any Minority Holding (including any surface water thereon or adjacent thereto, and soil and groundwater thereunder). "Pro Rata Share" means, with respect to any Lender, at any time the percentage obtained by dividing (i) the aggregate amount of the then unpaid principal amount of such Lender's Loans by (ii) the aggregate amount of the then unpaid principal amount of all of the Lenders' Loans. "Rate Page" means the display designated as "Page 3750" on the Associated Press-Dow Jones Telerate Service (or such other page as may replace Page 3750 on the Associated Press-Dow Jones Telerate Service or such other service as may be nominated by the British Bankers' Association as the information vendor for the purpose of displaying British Bankers' Association interest settlement rates for Dollar deposits). "RCRA" means the Resource Conservation and Recovery Act of 1976, 42 U.S.C.ss.ss.6901 et seq., any amendments thereto, any successor statutes, and any regulations or guidance having the force of law promulgated thereunder. "Real Estate Under Construction" means Real Property on which construction of material improvements has commenced and is continuing to be performed but has not yet been completed (as such completion shall be evidenced by such Property being opened for business to the general public). "Real Property" means all of the Borrower's or any Subsidiary of the Borrower's present and future right, title and interest (including, without limitation, any leasehold estate) in (i) any plots, pieces or parcels of land, (ii) any Improvements of every nature whatsoever (the rights and interests described in clauses (i) and (ii) above being the "Premises"), (iii) all easements, rights of way, gores of land or any lands occupied by streets, ways, alleys, passages, sewer rights, water courses, water rights and powers, and public places adjoining such land, and any other interests in property constituting appurtenances to the Premises, or which hereafter shall in any way belong, relate or be appurtenant thereto, (iv) all hereditaments, gas, oil, minerals (with the right to extract, sever and remove such gas, oil and minerals), and easements, of every nature whatsoever, located in, on or benefitting the Premises and (v) all other rights and privileges thereunto belonging or appertaining and all extensions, additions, improvements, betterments, renewals, substitutions and replacements to or of any of the rights and interests described in clauses (iii) and (iv) above. 21 "Recourse Indebtedness" means any Indebtedness to the extent that recourse of the applicable lender for non-payment is not limited to such lender's Liens on a particular asset or group of assets (except to the extent the property on which such lender has a Lien and to which its recourse for non-payment is limited constitutes Cash or Cash Equivalents, to which extent such Indebtedness shall be deemed to be Recourse Indebtedness). "Reference Bank" means Bankers Trust. "Register" is defined in Section 15.1(c). "Regulation A" means Regulation A of the Federal Reserve Board as in effect from time to time. "Regulation T" means Regulation T of the Federal Reserve Board as in effect from time to time. "Regulation U" means Regulation U of the Federal Reserve Board as in effect from time to time. "Regulation X" means Regulation X of the Federal Reserve Board as in effect from time to time. "REIT" means a domestic trust or corporation that qualifies as a real estate investment trust under the provisions of Sections 856, et seq. of the Internal Revenue Code. "Release" means any release, spill, emission, leaking, pumping, pouring, dumping, injection, deposit, disposal, abandonment, or discarding of barrels, containers or other receptacles, discharge, emptying, escape, dispersal, leaching or migration into the indoor or outdoor environment or into or out of any Property, including the movement of Contaminants through or in the air, soil, surface water, groundwater or Property. "Remedial Action" means actions required to (i) clean up, remove, treat or in any other way address Contaminants in the indoor or outdoor environment; (ii) prevent the Release or threat of Release or minimize the further Release of Contaminants; or (iii) investigate and determine if a remedial response is needed and to design such a response and post-remedial investigation, monitoring, operation and maintenance and care. "Reportable Event" means any of the events described in Section 4043(c) of ERISA and the regulations having the force of law promulgated thereunder as in effect from time to time but not including any such event as to which the thirty (30) day notice requirement has been waived by applicable PBGC regulations. "Requirements of Law" means, as to any Person, the charter and bylaws or other organizational or governing documents of such Person, and any law, rule or regulation, or 22 determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject including, without limitation, the Securities Act, the Securities Exchange Act, Regulations T, U and X, ERISA, the Fair Labor Standards Act, the Worker Adjustment and Retraining Notification Act, Americans with Disabilities Act of 1990, and any certificate of occupancy, zoning ordinance, building, environmental or land use requirement or Permit and Environmental, Health or Safety Requirement of Law. "Requisite Lenders" means the Lenders whose Pro Rata Shares, in the aggregate, represent an amount equal to or more than sixty-six and two-thirds percent (66-2/3%) of the aggregate Pro Rata Shares of all Lenders. "S&P" means Standard & Poor's Ratings Services, a Division of The McGraw Hill Companies, Inc. "Secured Indebtedness" means any Indebtedness secured by a Lien. "Securities" means any stock, shares, voting trust certificates, partnership interests, bonds, debentures, notes or other evidences of indebtedness, secured or unsecured, convertible, subordinated or otherwise, or in general any instruments commonly known as "securities", including, without limitation, any "security" as such term is defined in Section 8-102 of the Uniform Commercial Code, or any certificates of interest, shares, or participations in temporary or interim certificates for the purchase or acquisition of, or any right to subscribe to, purchase or acquire any of the foregoing, but shall not include the Notes or any other evidence of the Obligations. "Securities Act" means the Securities Act of 1933, as amended from time to time, and any successor statute. "Securities Exchange Act" means the Securities Exchange Act of 1934, as amended from time to time, and any successor statute. "Solvent" when used with respect to any Person, means that at the time of determination: (a) the fair saleable value of its assets is in excess of the total amount of its liabilities (including, without limitation, contingent liabilities); and (b) the present fair saleable value of its assets is greater than its probable liability on its existing debts as such debts become absolute and matured; and (c) such Person is then able and expects to be able to pay its debts (including, without limitation, contingent debts and other commitments) as they mature; and (d) such Person has capital sufficient to carry on its business as conducted and as proposed to be conducted. 23 "Subsidiary" of a Person means any corporation, limited liability company, general or limited partnership, trust or other entity of which Securities or other ownership interests having ordinary voting power to elect a majority of the board of directors or other persons performing similar functions are at the time directly or indirectly owned or controlled by such Person, one or more of the other subsidiaries of such Person or any combination thereof. For purposes of this Agreement, Subsidiaries of GGP, Inc. shall be considered Subsidiaries of the Borrower. "Syndication Agent" is defined in the preamble and includes Lehman, in its capacity as syndication agent for the Lenders and each successor syndication agent appointed in accordance with the terms of this Agreement. "Taxes" is defined in Section 13.1(a) hereof. "Tenant Allowance" means a cash allowance paid to a tenant by the landlord pursuant to a Lease. "TI Work" means any construction or other "build-out" of tenant leasehold improvements to the space demised to such tenant under Leases (excluding such tenant's furniture, fixtures and equipment) performed pursuant to the terms of such Leases, whether or not such tenant improvement work is performed by or on behalf of the landlord or as part of a Tenant Allowance. "Total Adjusted Outstanding Indebtedness" means, for any period, the sum of (i) the amount of Indebtedness of GGP, Inc. and the Consolidated Businesses set forth on the then most recent quarterly financial statements of GGP, Inc. and the Borrower, as applicable, and (ii) the outstanding amount of Minority Holding Indebtedness pro rata allocable to the Borrower and GGP, Inc. as of the time of determination and (iii) without duplication, the Contingent Obligations of GGP, Inc. and the Consolidated Businesses and, to the extent allocable to GGP, Inc. and the Consolidated Businesses in accordance with GAAP, of the Minority Holdings; provided, however, that for purposes of this calculation only, the term "Indebtedness" shall not include Indebtedness with respect to undrawn letters of credit issued to support guaranties of interest or interest and principal, or operating income guaranties or other performance guaranty or completion guaranty obligations; provided, however, that the exclusion for letters of credit issued to support performance guaranty obligations shall not exceed one percent (1.0%) of Capitalization Value. "Total Adjusted Outstanding Unsecured Indebtedness" means that portion of Total Adjusted Outstanding Indebtedness that is Unsecured Indebtedness. "Uniform Commercial Code" means the Uniform Commercial Code as enacted in the State of New York, as it may be amended from time to time. "Unsecured Indebtedness" means Indebtedness that is not secured by any Lien. 1.2. Computation of Time Periods. In this Agreement, in the computation of periods of time from a specified date to a later specified date, the word "from" means "from and 24 including" and the words "to" and "until" each mean "to but excluding". Periods of days referred to in this Agreement shall be counted in calendar days unless Business Days are expressly prescribed. Any period determined hereunder by reference to a month or months or year or years shall end on the day in the relevant calendar month in the relevant year, if applicable, immediately preceding the date numerically corresponding to the first day of such period, provided, that if such period commences on the last day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month during which such period is to end), such period shall, unless otherwise expressly required by the other provisions of this Agreement, end on the last day of the calendar month. 1.3. Accounting Terms. Subject to Section 15.4, for purposes of this Agreement, all accounting terms not otherwise defined herein shall have the meanings assigned to them in conformity with GAAP. 1.4. Other Terms. All other terms contained in this Agreement shall, unless the context indicates otherwise, have the meanings assigned to such terms by the Uniform Commercial Code to the extent the same are defined therein. ARTICLE II AMOUNTS AND TERMS OF LOANS 2.1. Loans. (a) Availability. Subject to the terms and conditions set forth in this Agreement, each Lender hereby severally and not jointly agrees to make term loans, in Dollars (each individually, a "Loan" and, collectively, the "Loans") to the Borrower on the Initial Funding Date, in the case of the Lenders parties hereto as of the Closing Date, and on the Funding Date requested by the Borrower in respect of any requested Borrowing in connection with additional Loans provided pursuant to Article III, in an amount not to exceed such Lender's Loan Commitment at such time. No Lender shall be responsible for any failure by any other Lender to perform its obligation to make a Loan hereunder nor shall the Loan Commitment of any Lender be increased or decreased as a result of any such failure. (b) Notice of Borrowing. The Borrower shall deliver to the Administrative Agent an irrevocable notice of borrowing, signed by it (i) no later than 12:00 noon (New York time) on the Business Day immediately preceding the proposed Funding Date, in the case of a Borrowing of Base Rate Loans and (ii) no later than 12:00 noon (New York time) at least three (3) Business Days in advance of the proposed Funding Date, in the case of a Borrowing of Eurodollar Rate Loans. Such notice of borrowing shall specify (i) the proposed Funding Date (which shall be a Business Day), (ii) the amount of the proposed Borrowing, (iii) whether the proposed Borrowing will be of Base Rate Loans or Eurodollar Rate Loans, (iv) in the case of Eurodollar Rate Loans, the requested Eurodollar Interest Period and (v) instructions for the disbursement of the proceeds of the proposed Borrowing. (c) Making of Loans. Promptly after receipt of a notice of borrowing under Section 2.1(b), the Administrative Agent shall promptly notify each Lender by facsimile 25 transmission, or other similar form of transmission, of the proposed Borrowing. Each Lender shall deposit an amount equal to its Pro Rata Share of the Borrowing requested by the Borrower with the Administrative Agent at its office in New York, New York in immediately available funds, not later than 12:00 Noon (New York time) on the Funding Date therefor, provided that with respect to any Borrowing made after the Initial Funding Date pursuant to Article III, each Lender agreeing to provide additional Loans on a Funding Date shall provide its proportionate share of Loans agreed to be made by such Lender pursuant to Article III on such Funding Date. Subject to the fulfillment of the conditions precedent set forth in Section 6.1 or Section 6.2, as applicable, the Administrative Agent shall make the proceeds of such amounts received by it available to the Borrower at the Administrative Agent's office in New York, New York on the applicable Funding Date and shall disburse such proceeds in accordance with the Borrower's disbursement instructions set forth in the applicable notice of borrowing. The failure of any Lender to deposit the amount described above with the Administrative Agent on the applicable Funding Date shall not relieve any other Lender of its obligations hereunder to make its Loan on such Funding Date. 2.2. [Intentionally Omitted]. 2.3. Use of Proceeds of Loans. The proceeds of the Loans to the Borrower hereunder may be used for the purposes of: (a) development of Real Properties owned, directly or indirectly, and operated by the Borrower; and (b) other general and working capital needs of the Borrower, inclusive of repayment of Indebtedness for borrowed money, each of which purposes described in clauses (a) and (b) shall be lawful working capital purposes of the Borrower. 2.4. Repayment. The Loans of each Lender shall mature in six (6) consecutive quarterly installments, commencing on January 31, 2002, each of which shall be in an amount equal to the amount (as a percentage as set forth below of the sum of the original principal amount of the Loans made by such Lender on the Initial Funding Date, plus the original principal amount of any additional Loans made by such Lender pursuant to Article III) on the installment payment date set forth below: Percentage of Lenders' Installment Payment Date Original Loans ------------------------ -------------- January 31, 2002 10% April 30, 2002 5% July 31, 2002 5% October 31, 2002 5% January 31, 2003 5% April 30, 2003 5% July 31, 2003 Remaining Balance 26 2.5. [Intentionally Omitted]. 2.6. [Intentionally Omitted]. 2.7. Authorized Agents. On the Closing Date and from time to time thereafter, the Borrower shall deliver to the Administrative Agent an Officer's Certificate setting forth the names of the employees and agents authorized to request Loans and to request a conversion/continuation of any Loan and containing a specimen signature of each such employee or agent. The employees and agents so authorized shall also be authorized to act for the Borrower in respect of all other matters relating to the Loan Documents. The Co-Agents and the Lenders shall be entitled to rely conclusively on such employee's or agent's authority to request such Loan or such conversion/continuation until the Administrative Agent receives written notice to the contrary. The Administrative Agent shall have no duty to verify the authenticity of the signature appearing on any written notice of borrowing or Notice of Conversion/Continuation or any other document, and, with respect to an oral request for any Loan or any conversion/continuation, the Administrative Agent shall have no duty to verify the identity of any person representing himself or herself as one of the employees or agents authorized to make such request or otherwise to act on behalf of the Borrower. None of the Co-Agents or the Lenders shall incur any liability to the Borrower or any other Person in acting upon any telephonic or facsimile notice referred to above which such Co-Agent or such Lender reasonably believes to have been given by a person duly authorized to act on behalf of the Borrower and the Borrower hereby indemnifies and holds harmless each Co-Agent and each Lender from any loss or expense the Co-Agents or the Lenders incur in acting in good faith as provided in this Section 2.7, provided, however, that the Borrower shall not indemnify or hold harmless either Co-Agent or any Lender from any loss or expense incurred as the result of such Co-Agent's or such Lender's gross negligence or willful misconduct. ARTICLE III ADDITIONAL LOANS 3.1. Additional Loans. Notwithstanding anything to the contrary contained herein, in connection with any proposed additional Loans to be made by any Lender(s) or any proposed joinder of any Eligible Assignee(s) as a new Lender(s) party to this Agreement, the Maximum Aggregate Loan Amount may be increased (i) with the consent of the Borrower (and such Lender) to an amount not greater than $150,000,000 and (ii) with the consent of the Borrower and the Co-Agents (and such Lender), to an amount not greater than $300,000,000. 3.2. Joinder of New Lender. In the event of any such proposed joinder by an Eligible Assignee, such joinder shall occur only as to additional Loans to be made by such Eligible Assignee that will not cause the Loan Obligations to exceed the Maximum Aggregate Loan Amount, after giving effect to such joinder and any other such joinders, and the additional Loans made thereunder, and any additional Loans made under Section 3.3 hereof to occur substantially contemporaneously therewith. The proposed joinder of any Eligible Assignee satisfying the requirements of the preceding sentence shall be effectuated through such Eligible Assignee's execution and delivery to the Administrative Agent, the Borrower and each Lender of a joinder agreement, in form and content reasonably satisfactory to the Co-Agents and the 27 Borrower, pursuant to which such Eligible Assignee agrees to become a Lender hereunder and under the other Loan Documents and assumes all of the obligations of a Lender hereunder and thereunder, whereupon, effective as of the date of such execution and delivery: (a) such Eligible Assignee shall become a Lender party to this Agreement for all purposes hereof, entitled to all of the rights and subject to all of the obligations of a Lender hereunder, (b) the Loan Obligations of such Eligible Assignee shall be the amount of additional Loans made by such Eligible Assignee as set forth in such joinder agreement (which amount will not cause all Loan Obligations to exceed the Maximum Aggregate Loan Amount, after giving effect to such joinder and any other such joinders, and the additional Loans made thereunder, and any additional Loans made under Section 3.3 hereof to occur substantially contemporaneously therewith), (c) the Borrower shall immediately pay to such Eligible Assignee such fees as the Borrower may have agreed to pay in connection with the joinder of such Eligible Assignee and/or the related increase in the Maximum Aggregate Loan Amount), and (d) to the extent requested by such Eligible Assignee, the Borrower shall immediately deliver to each such Eligible Assignee a Note substantially in the form attached hereto as Exhibit B in the amount of such Eligible Assignee's Loans. 3.3. Additional Loans made by Existing Lender. In the event of any such proposed additional Loans to be made by any Lender, such additional Loans shall be made only as to additional Loans in an amount that will not cause all Loan Obligations to exceed the Maximum Aggregate Loan Amount, after giving effect to such additional Loans and any other such additional Loans and any joinders under Section 3.2 hereof to occur substantially contemporaneously therewith. Any proposed additional Loans satisfying the requirements of the preceding sentence shall be effectuated through such Lender's execution and delivery to the Co-Agents, the Borrower and each Lender of an addendum to this Agreement, in form and content reasonably satisfactory to the Co-Agents and the Borrower, evidencing such additional Loans, whereupon, effective as of the date of such execution and delivery: (a) the Loan Obligations of such Lender shall be increased by the amount of additional Loans made by such Lender as set forth in such addendum (which amount shall not cause all Loan Obligations to exceed the Maximum Aggregate Loan Amount, after giving effect to such additional Loans and any other such additional Loans and any joinders under Section 3.2 hereof to occur substantially contemporaneously therewith), (b) the Borrower shall immediately pay to such Lender such fees as the Borrower may have agreed to pay in connection with the increase and/or the related increase in the Maximum Aggregate Loan Amount, and (c) to the extent requested by such Lender, the Borrower shall immediately deliver to each such Lender a replacement Note substantially in the form attached hereto as Exhibit B in the amount of such Lender's Loan Obligations, upon receipt of which such Lender shall surrender its original Note, if any, marked "Replaced". 28 ARTICLE IV PAYMENTS AND PREPAYMENTS 4.1. Prepayments. (a) Voluntary Prepayments. The Borrower may, at any time and from time to time, prepay the Loans, in part or in their entirety, subject to the following limitations. The Borrower shall give at least five (5) days' prior written notice to the Administrative Agent (which the Administrative Agent shall promptly transmit to each Lender) of any prepayment in the entirety to be made prior to the occurrence of an Event of Default, which notice of prepayment shall specify the date (which shall be a Business Day) of prepayment. When notice of prepayment is delivered as provided herein, the outstanding principal amount of the Loans to be prepaid on the prepayment date specified in the notice shall become due and payable on such prepayment date. Each voluntary partial prepayment of the Loans shall be in a minimum amount of $1,000,000. Eurodollar Rate Loans may be prepaid in part or in their entirety only upon payment of the amounts described in Section 5.2(f). Amounts prepaid pursuant to this Section 4.1(a) may not be reborrowed. (b) No Penalty. The prepayments and payments described in clause (a) of this Section 4.1 may be made without premium or penalty (except as provided in Section 5.2(f)). (c) Mandatory Prepayment. (i) If at any time from and after the Closing Date: (i) the Borrower merges or consolidates with another Person and the Borrower is not the surviving entity, or (ii) within any twelve (12) month period, the Borrower or any Consolidated Subsidiary or any Minority Holding sells, transfers, assigns, conveys or suffers foreclosure as to assets, the book value of which (computed in accordance with GAAP but without deduction for depreciation), in the aggregate of all such sales, transfers, assignments, foreclosures or conveyances exceeds twenty percent (20%) of the then Capitalization Value, or (iii) the portion of Capitalization Value attributable to the aggregate Limited Minority Holdings (exclusive of Limited Minority Holdings existing as of the Closing Date) of the Borrower and its Consolidated Subsidiaries exceeds twenty percent (20%) of the then Capitalization Value, or (iv) the Management Company ceases to provide property management and leasing services to at least seventy-five percent (75%) of the total number of Real Properties in which the Borrower has an ownership interest (exclusive of Properties which are Limited Minority Holdings) (the date any such event shall occur being the "Prepayment Date"), the Borrower shall be required to prepay the Loans in their entirety as if the Prepayment Date were the Maturity Date. The Borrower shall immediately make such prepayment together with interest accrued to the date of the prepayment on the principal amount prepaid. In connection with the prepayment of any Loan prior to the maturity thereof, the Borrower shall also pay any applicable expenses pursuant to Section 5.2(f). Each such prepayment shall be applied to prepay ratably the Loans of the Lenders. Amounts prepaid pursuant to this Section 4.1(c)(i) may not be reborrowed. As used in this Section 4.1(c)(i) only, the phrase "sells, transfers, assigns or conveys" shall not include (i) sales or conveyances among Borrower and any 29 Consolidated Subsidiaries, or (ii) the granting of mortgages secured by Real Property, or (iii) sales or conveyances of Securities in the Borrower or in newly-formed Subsidiaries or Minority Holdings in connection with the acquisition of interests in Real Property. (ii) If an Event of Default shall occur under Section 10.12(e) hereof and for so long as it shall be continuing, then, in addition to all other rights and remedies of the Co-Agents and the Lenders hereunder in respect of such Event of Default, the Borrower shall apply all External Revenues, within thirty (30) days after receipt thereof, to pay or prepay, as the case may be, on a pro rata basis, all Total Adjusted Outstanding Unsecured Indebtedness for borrowed money, including, without limitation, the Loans then outstanding hereunder; provided, however, that no such application of External Revenues, nor any demand therefor or acceptance thereof by the Co-Agents, the Lenders or any other lender, shall result in any waiver, release, limitation or impairment of any Obligation of the Borrower, or of any right, remedy or recourse of the Co-Agents and the Lenders, in connection with such Event of Default. 4.2. Payments. (a) Manner and Time of Payment. All payments of principal and interest on the Loans and other Obligations (including, without limitation, fees and expenses) which are payable to the Administrative Agent or any other Lender shall be made without condition or reservation of right, in immediately available funds, transmitted to the Administrative Agent not later than 12:00 noon (New York time) on the date and at the place due, to such account of the Administrative Agent as it may designate, for the account of the Administrative Agent or such other Lender, as the case may be; and funds received by the Administrative Agent, including, without limitation, funds in respect of any Loans to be made on that date, not later than 12:00 noon (New York time) on any given Business Day shall be credited against payment to be made that day and funds received by the Administrative Agent after that time shall be deemed to have been paid on the next succeeding Business Day. Payments actually received by the Administrative Agent for the account of the Lenders, or any of them, shall be paid to them in immediately available funds by the Administrative Agent promptly after receipt thereof. (b) Apportionment of Payments. (i) All payments of principal and interest in respect of outstanding Loans, all payments of fees and all other payments in respect of any other Obligations, shall be allocated among such of the Lenders as are entitled thereto, in proportion to their respective Pro Rata Shares or otherwise as provided herein. Subject to the provisions of Section 4.2(b)(ii), all such payments and any other amounts received by the Administrative Agent from or for the benefit of the Borrower shall be applied in the following order: (1) first, to pay all Obligations then due and payable, (2) second, to pay installments of principal next due, and (3) third, as the Borrower so designates. 30 Unless otherwise designated by the Borrower, all principal payments in respect of Loans shall be applied first, to repay outstanding Base Rate Loans, and then to repay outstanding Eurodollar Rate Loans, with those Eurodollar Rate Loans which have earlier expiring Eurodollar Interest Periods being repaid prior to those which have later expiring Eurodollar Interest Periods. (ii) After the occurrence of an Event of Default and while the same is continuing, the Administrative Agent shall apply all payments in respect of any Obligations in the following order: (1) first, to pay Obligations in respect of any fees, expense reimbursements or indemnities then due to the Co-Agents, or any of them, in their respective capacities as such and not as Lenders; (2) second, to pay Obligations in respect of any fees, expense reimbursements or indemnities then due to the Lenders; (3) (third, to pay interest due in respect of Loans; (4) fourth, to the ratable payment or prepayment of the outstanding principal amounts of Loans to be applied to installments of principal next due; and (5) fifth, to the ratable payment of all other Obligations. The order of priority set forth in this Section 4.2(b)(ii) and the related provisions of this Agreement (other than the provisions regarding application of payments in clause (4), on which the Borrower may rely) are set forth solely to determine the rights and priorities of the Administrative Agent, the Lenders and other Holders as among themselves. (iii) The Administrative Agent shall promptly distribute to each other Lender at its primary address set forth on the appropriate signature page hereof or the signature page to the Assignment and Acceptance or joinder agreement pursuant to Section 3.2 by which it became a Lender, or at such other address as a Lender or other Holder may request in writing, such funds as such Person may be entitled to receive, subject to the provisions of Article XII; provided, however, that the Administrative Agent shall under no circumstances be bound to inquire into or determine the validity, scope or priority of any interest or entitlement of any Holder and may suspend all payments or seek appropriate relief (including, without limitation, instructions from the Requisite Lenders or an action in the nature of interpleader) in the event of any doubt or dispute as to any apportionment or distribution contemplated hereby. (c) Payments on Non-Business Days. Whenever any payment to be made by the Borrower hereunder or under the Notes is stated to be due on a day which is not a Business Day, the payment shall instead be due on the next succeeding Business Day (or, if required pursuant to Section 5.2(b)(iii), the next preceding Business Day). 31 4.3. Promise to Repay; Evidence of Indebtedness. (a) Promise to Repay. The Borrower, jointly and severally, hereby agrees to pay when due the principal amount of each Loan which is made to it, and, jointly and severally, further agrees to pay all unpaid interest accrued thereon, in accordance with the terms of this Agreement and the Notes. The Borrower shall execute and deliver on the Closing Date to each Lender requesting a Note, a Note evidencing the Loans owing or which may become owing to such Lender, and thereafter shall execute and deliver such other Notes as are necessary to evidence the Loans owing to any Lender requesting a Note after giving effect to any Assignment and Acceptance thereof pursuant to Section 15.1 or joinder agreement pursuant to Section 3.2, all in form and substance acceptable to the Administrative Agent and the parties to such Assignment and Acceptance or joinder agreement. (b) Loan Account. Each Lender shall maintain in accordance with its usual practice an account or accounts (a "Loan Account") evidencing the Indebtedness of the Borrower to such Lender resulting from each Loan owing to such Lender from time to time, including, without limitation, the amount of principal and interest payable and paid to such Lender from time to time hereunder and under the Notes. (c) Control Account. The Register maintained by the Administrative Agent pursuant to Section 15.1(c) shall include a control account, and a subsidiary account for each Lender, in which accounts (taken together) shall be recorded (i) the amount of the Loan Obligations, the type of Loans and any Eurodollar Interest Period applicable thereto, (ii) the effective date and amount of each Assignment and Acceptance or joinder agreement pursuant to Section 3.2 delivered to and accepted by it and the parties thereto, (iii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder or under the Notes and (iv) the amount of any sum received by the Administrative Agent from the Borrower hereunder and each Lender's share thereof. (d) Entries Binding. The entries made in the Register and each Loan Account shall be conclusive and binding for all purposes, absent manifest error. ARTICLE V INTEREST AND FEES 5.1. Interest on the Loans and Other Obligations. (a) Rate of Interest. All Loans and the outstanding principal balance of all other Obligations shall bear interest on the unpaid principal amount thereof from the date such Loans are made and such other Obligations are due and payable until paid in full, except as otherwise provided in Section 5.1(d), as follows: (i) If a Base Rate Loan or an Obligation other than a Eurodollar Rate Loan, at a rate per annum equal to the sum of (A) the Base Rate, as in effect from time to time as interest accrues, plus (B) the then Applicable Margin for Base Rate Loans; and 32 (ii) If a Eurodollar Rate Loan, at a rate per annum equal to the sum of (A) the Eurodollar Rate determined for the applicable Eurodollar Interest Period, plus (B) the then Applicable Margin for Eurodollar Rate Loans. The applicable basis for determining the rate of interest on the Loans shall be selected by the Borrower at the time a notice of borrowing or a Notice of Conversion/Continuation is delivered by the Borrower to the Administrative Agent; provided, however, that the Borrower may not select the Eurodollar Rate as the applicable basis for determining the rate of interest on such a Loan if at the time of such selection an Event of Default has occurred and is continuing or would occur as a result of such selection; and provided further that from and after the occurrence of an Event of Default, each Eurodollar Rate Loan then outstanding shall, at the Administrative Agent's option (notice of any election of which the Administrative Agent shall promptly give to the Borrower), be converted to a Base Rate Loan. If on any day any Loan is outstanding with respect to which notice has not been timely delivered to the Administrative Agent in accordance with the terms of this Agreement specifying the basis for determining the rate of interest on that day, then for that day interest on that Loan shall be determined by reference to the Base Rate. (b) Interest Payments. (i) Interest accrued on each Loan, whether a Base Rate Loan or a Eurodollar Rate Loan, shall be calculated on the last day of each calendar month and shall be payable in arrears (A) on the first day of each calendar month with respect to a Base Rate Loan or Eurodollar Rate Loan, commencing on the first such day following the making of such Loan, (B) upon the payment or prepayment thereof in full or in part, and (C) if not previously paid in full, at maturity (whether by acceleration or otherwise) of such Loan. (ii) Interest accrued on the principal balance of all other Obligations shall be calculated on the last day of each calendar month and shall be payable in arrears (A) on the first day of each calendar month, commencing on the first such day following the accrual of such Obligation, (B) upon repayment thereof in full or in part, and (C) if not previously paid in full, at the time such other Obligation becomes due and payable (whether by acceleration or otherwise). (c) Conversion or Continuation. (i) The Borrower shall have the option (A) to convert at any time all or any part of outstanding Base Rate Loans to Eurodollar Rate Loans; (B) to convert all or any part of outstanding Eurodollar Rate Loans having Eurodollar Interest Periods which expire on the same date to Base Rate Loans on such expiration date; or (C) to continue all or any part of outstanding Eurodollar Rate Loans having Eurodollar Interest Periods which expire on the same date as Eurodollar Rate Loans, and the succeeding Eurodollar Interest Period of such continued Loans shall commence on such expiration date; provided, however, no such outstanding Loan may be continued as, or be converted into, a Eurodollar Rate Loan (i) if such continuation or conversion would violate any of the provisions of Section 5.2 or (ii) if an Event of Default has occurred and is continuing or would occur as a result of such continuation or conversion. Any conversion into or 33 continuation of Eurodollar Rate Loans under this Section 5.1(c) shall be in a minimum amount of $2,000,000 and in integral multiples of $1,000,000 in excess of that amount. (ii) To convert or continue a Loan under Section 5.1(c)(i), the Borrower shall deliver a Notice of Conversion/Continuation to the Administrative Agent no later than 12:00 noon (New York time) at least three (3) Business Days in advance of the proposed conversion/ continuation date. A Notice of Conversion/Continuation shall specify (A) the proposed conversion/continuation date (which shall be a Business Day), (B) the principal amount of the Loan to be converted/continued, (C) whether such Loan shall be converted and/or continued, and (D) in the case of a conversion to, or continuation of, a Eurodollar Rate Loan, the requested Eurodollar Interest Period. In lieu of delivering a Notice of Conversion/Continuation, the Borrower may give the Administrative Agent telephonic notice of any proposed conversion/continuation by the time required under this Section 5.1(c)(ii), if the Borrower confirms such notice by delivery of the Notice of Conversion/Continuation to the Administrative Agent by facsimile transmission promptly, but in no event later than 3:00 p.m. (New York time) on the same day. Promptly after receipt of a Notice of Conversion/ Continuation under this Section 5.1(c)(ii) (or telephonic notice in lieu thereof), the Administrative Agent shall notify each Lender by facsimile transmission, or other similar form of transmission, of the proposed conversion/continuation. Any Notice of Conversion/Continuation for conversion to, or continuation of, a Loan (or telephonic notice in lieu thereof) given pursuant to this Section 5.1(c)(ii) shall be irrevocable, and the Borrower shall be bound to convert or continue in accordance therewith. In the event no Notice of Conversion/Continuation is delivered as and when specified in this Section 5.1(c)(ii) with respect to outstanding Eurodollar Rate Loans, upon the expiration of the Eurodollar Interest Period applicable thereto, such Loans shall automatically be continued as Eurodollar Rate Loans with a Eurodollar Interest Period of thirty (30) days. (d) Default Interest. Notwithstanding the rates of interest specified in Section 5.1(a) or elsewhere in this Agreement, effective immediately upon the occurrence of an Event of Default, and for as long thereafter as such Event of Default shall be continuing, the principal balance of all Loans and other Obligations shall bear interest at a rate equal to the sum of (A) the applicable interest rate, as in effect from time to time as interest accrues, plus (B) three percent (3.0%) per annum. (e) Computation of Interest. Interest on all Obligations shall be computed on the basis of the actual number of days elapsed in the period during which interest accrues and a year of 360 days. In computing interest on any Loan, the date of the making of the Loan or the first day of a Eurodollar Interest Period, as the case may be, shall be included and the date of payment or the expiration date of a Eurodollar Interest Period, as the case may be, shall be excluded; provided, however, if a Loan is repaid on the same day on which it is made, one (1) day's interest shall be paid on such Loan. (f) Eurodollar Rate Information. Upon the reasonable request of the Borrower from time to time, the Administrative Agent shall promptly provide to the Borrower such information with respect to the applicable Eurodollar Rate as may be so requested. 34 5.2. Special Provisions Governing Eurodollar Rate Loans. (a) Amount of Eurodollar Rate Loans. Each Eurodollar Rate Loan shall be in a minimum principal amount of $2,000,000 and in integral multiples of $1,000,000 in excess of that amount. (b) Determination of Eurodollar Interest Period. By giving notice as set forth in Section 2.1(b) (with respect to a Borrowing of Eurodollar Rate Loans) or Section 5.1(c) (with respect to a conversion into or continuation of Eurodollar Rate Loans), the Borrower shall have the option, subject to the other provisions of this Section 5.2, to select an interest period (each, a "Eurodollar Interest Period") to apply to the Loans described in such notice, subject to the following provisions: (i) The Borrower may only select, as to a particular Borrowing of Eurodollar Rate Loans, a Eurodollar Interest Period of one, two, three or six months in duration or, with the prior written consent of the Administrative Agent, a shorter or a longer duration; (ii) In the case of immediately successive Eurodollar Interest Periods applicable to a Borrowing of Eurodollar Rate Loans, each successive Eurodollar Interest Period shall commence on the day on which the next preceding Eurodollar Interest Period expires; (iii) If any Eurodollar Interest Period would otherwise expire on a day which is not a Business Day, such Eurodollar Interest Period shall be extended to expire on the next succeeding Business Day, if the next succeeding Business Day occurs in the same calendar month, and, if there will be no succeeding Business Day in such calendar month, the Eurodollar Interest Period shall expire on the immediately preceding Business Day; (iv) The Borrower may not select a Eurodollar Interest Period as to any Loan if such Eurodollar Interest Period terminates later than the Maturity Date; and (v) There shall be no more than six (6) Eurodollar Rate Loans outstanding at any one time. (c) Determination of Eurodollar Interest Rate. As soon as practicable on the second Business Day prior to the first day of each Eurodollar Interest Period (the "Eurodollar Interest Rate Determination Date"), the Administrative Agent shall determine (pursuant to the procedures set forth in the definition of Eurodollar Rate) the interest rate which shall apply to the Eurodollar Rate Loans for which an interest rate is then being determined for the applicable Eurodollar Interest Period and shall promptly give notice thereof (in writing or by telephone confirmed in writing) to the Borrower and to each Lender. The Administrative Agent's determination shall be presumed to be correct, absent manifest error, and shall be binding upon the Borrower. (d) Interest Rate Unascertainable Inadequate or Unfair. In the event that at least one (1) Business Day before the Eurodollar Interest Rate Determination Date: 35 (i) the Administrative Agent determines that deposits in Dollars are not being offered in the London interbank market for such Eurodollar Interest Period; or (ii) the Administrative Agent determines that adequate and fair means do not exist for ascertaining the applicable interest rates by reference to which the Eurodollar Rate then being determined is to be fixed; or (iii) the Requisite Lenders advise the Administrative Agent that the Eurodollar Rate for Eurodollar Rate Loans comprising such Borrowing will not adequately reflect the cost to such Requisite Lenders of obtaining funds in Dollars in the London interbank market in the amount substantially equal to such Lenders' Eurodollar Rate Loans in Dollars and for a period equal to such Eurodollar Interest Period; then the Administrative Agent shall forthwith give notice thereof to the Borrower, whereupon (until the Administrative Agent notifies the Borrower that the circumstances giving rise to such suspension no longer exist) the right of the Borrower to elect to have Loans bear interest based upon the Eurodollar Rate shall be suspended and each outstanding Eurodollar Rate Loan shall be converted into a Base Rate Loan on the last day of the then current Eurodollar Interest Period therefor, notwithstanding any prior election by the Borrower to the contrary. (e) Illegality. (i) If at any time any Lender determines (which determination shall, absent manifest error, be final and conclusive and binding upon all parties) that the making or continuation of any Eurodollar Rate Loan has become unlawful or impermissible by compliance by that Lender with any law, governmental rule, regulation or order of any Governmental Authority (whether or not having the force of law and whether or not failure to comply therewith would be unlawful or would result in costs or penalties), then, and in any such event, such Lender may give notice of that determination, in writing, to the Borrower and the Administrative Agent, and the Administrative Agent shall promptly transmit the notice to each other Lender. (ii) When notice is given by a Lender under Section 5.2(e)(i), (A) the Borrower's right to request from such Lender and such Lender's obligation, if any, to make Eurodollar Rate Loans shall be immediately suspended, and such Lender shall make a Base Rate Loan as part of any requested Borrowing of Eurodollar Rate Loans and (B) if the affected Eurodollar Rate Loan or Loans are then outstanding, the Borrower shall immediately, or if permitted by applicable law, no later than the date permitted thereby, upon at least one (1) Business Day's prior written notice to the Administrative Agent and the affected Lender, convert each such Loan into a Base Rate Loan. (iii) If at any time after a Lender gives notice under Section 5.2(e)(i) such Lender determines that it may lawfully make Eurodollar Rate Loans, such Lender shall promptly give notice of that determination, in writing, to the Borrower and the Administrative Agent, and the Administrative Agent shall promptly transmit the notice to each other Lender. The Borrower's right to request, and such Lender's obligation, if any, to make Eurodollar Rate Loans shall thereupon be restored. 36 (iv) Notwithstanding the foregoing, in the event that any Lender gives such a notice, at Borrower's sole election, Borrower may identify an Eligible Assignee to whom the Lender which has given such a notice shall assign its interest in the Loans pursuant to the terms of an Assignment and Acceptance substantially in the form attached as Exhibit A. (f) Compensation. In addition to all amounts required to be paid by the Borrower pursuant to Section 5.1 and Article XIII, the Borrower shall compensate each Lender, upon demand, for all losses, expenses and liabilities (including, without limitation, any loss or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Lender to fund or maintain such Lender's Eurodollar Rate Loans to the Borrower but excluding any loss of Applicable Margin on the relevant Loans and losses or expenses incurred as the result of such Lender's gross negligence or willful misconduct) which that Lender may sustain (i) if for any reason a Borrowing, conversion into or continuation of Eurodollar Rate Loans does not occur on a date specified therefor in a notice of borrowing or a Notice of Conversion/Continuation given by the Borrower or in a telephonic request by it for borrowing or conversion/continuation or a successive Eurodollar Interest Period does not commence after notice therefor is given pursuant to Section 5.1(c) (other than such a failure resulting from the circumstances described in Sections 5.2(d) or 5.2(e)), (ii) if for any reason any Eurodollar Rate Loan is prepaid (including, without limitation, on a mandatory basis pursuant to Section 4.1(d)) on a date which is not the last day of the applicable Eurodollar Interest Period, or (iii) as a consequence of any failure by the Borrower to repay a Eurodollar Rate Loan when required by the terms of this Agreement. The Lender making demand for such compensation shall deliver to the Administrative Agent concurrently with such demand, and the Administrative Agent shall promptly forward to the Borrower, a written statement setting forth in reasonable detail such losses, expenses and liabilities, and such statement shall be conclusive as to the amount of compensation due to that Lender, absent manifest error. (g) Booking of Eurodollar Rate Loans. Any Lender may make, carry or transfer Eurodollar Rate Loans at, to, or for the account of, its Eurodollar Lending Office or Eurodollar Affiliate or its other offices or Affiliates. No Lender shall be entitled, however, to receive any greater amount under Sections 4.2 or 5.2(f) or Article XIII as a result of the transfer of any such Eurodollar Rate Loan to any office (other than such Eurodollar Lending Office) or any Affiliate (other than such Eurodollar Affiliate) than such Lender would have been entitled to receive immediately prior thereto, unless (i) the transfer occurred at a time when circumstances giving rise to the claim for such greater amount did not exist and (ii) such claim would have arisen even if such transfer had not occurred. (h) Affiliates Not Obligated. No Eurodollar Affiliate or other Affiliate of any Lender shall be deemed a party to this Agreement or shall have any liability or obligation under this Agreement unless such Eurodollar Affiliate, itself, is a Lender. (i) Adjusted Eurodollar Rate. Any failure by any Lender to take into account the Eurodollar Reserve Percentage when calculating interest due on Eurodollar Rate Loans shall not constitute, whether by course of dealing or otherwise, a waiver by such Lender of its right to collect such amount for any future period. 37 5.3. Fees. (a) Agency Fee. The Borrower shall pay to the Administrative Agent for its own account an annual fee in an amount equal to $40,000, prorated on a per diem basis for any partial calendar year, and payable in advance in monthly installments, with the first installment being due and payable on the Closing Date and subsequent installments being due and payable on the first day of each calendar month. (b) Calculation and Payment of Fees. All fees shall be calculated on the basis of the actual number of days elapsed during the relevant period in a 360-day year. All fees shall be payable in addition to, and not in lieu of, interest, compensation, expense reimbursements, indemnification and other Obligations. Fees shall be payable to the Administrative Agent at its office in New York, New York in immediately available funds. All fees shall be fully earned and nonrefundable when paid. All fees due to any other Lender, including, without limitation, those referred to in this Section 5.3, shall bear interest, if not paid when due, at the interest rate specified in Section 5.1(d) and shall constitute Obligations. ARTICLE VI CONDITIONS TO LOANS 6.1. Conditions Precedent to the Initial Loans. The obligation of each Lender on the Initial Funding Date to make any Loan requested to be made by it shall be subject to the satisfaction or waiver of all of the following conditions precedent: (a) Documents. The Administrative Agent shall have received, on or before the Initial Funding Date, this Agreement, the Notes for each Lender requesting a Note, the Guaranty, all other Loan Documents and agreements, documents and instruments described in the List of Closing Documents attached hereto as Exhibit D and made a part hereof, and such additional documentation as either Co-Agent may reasonably request, each duly executed, if applicable, by the Borrower or GGP, Inc., as appropriate, and in form and substance satisfactory to such Co-Agent. Without limiting the foregoing, the Borrower hereby directs its counsel, Neal, Gerber & Eisenberg, to prepare and deliver to the Co-Agents and the Lenders, the legal opinion referred to in such List of Closing Documents. (b) No Legal Impediments. No law, regulation, order, judgment or decree of any Governmental Authority shall, and the Co-Agents shall not have received any notice that litigation is pending or threatened which is likely to (i) enjoin, prohibit or restrain the making of the Loans on the Initial Funding Date or (ii) have a Material Adverse Effect. (c) No Change in Condition. No change in the business, assets, management, operations, financial condition or prospects of the Borrower, GGP, Inc. or any of their respective Subsidiaries or Properties shall have occurred since March 31, 2000, which change, in the judgment of the Co-Agents, has had, will have or is reasonably likely to have a Material Adverse Effect. (d) Interim Liabilities and Equity. Except as disclosed to the Co- Agents and the Lenders, since March 31, 2000, the Borrower or any of its Subsidiaries shall not have (i) 38 entered into any material (as determined in good faith by the Co-Agents) commitment or transaction, including, without limitation, transactions for borrowings and Capital Expenditures, which are not in the ordinary course of the Borrower's or such Subsidiary's business, (ii) declared or paid any dividends or other distributions (other than the dividend anticipated to be paid on July 31, 2000), (iii) established compensation or employee benefit plans, or (iv) redeemed any equity Securities. (e) No Loss of Material Agreements and Licenses. Since March 31, 2000, no agreement or license relating to the business, operations or employee relations of the Borrower or any of its Subsidiaries or Properties shall have been terminated, modified, revoked, breached or declared to be in default, the termination, modification, revocation, breach or default under which, in the reasonable judgment of the Co-Agents, would result in a Material Adverse Effect. (f) Sharing Agreement. The Partnership and the Company shall have entered into, and delivered to the Co-Agents a complete and accurate copy of, a written agreement, in form and substance reasonably satisfactory to the Co- Agents, providing for such adjustments between the Partnership and the Company as may be necessary from time to time to assure, insofar as practicable, that each of them bears the costs and other burdens imposed on the Borrower under this Agreement and the other Loan Documents to which the Borrower is a party substantially in proportion to the loan proceeds and other benefits received and enjoyed by them, respectively, hereunder and thereunder. (g) No Default. No Event of Default or Potential Event of Default shall have occurred and be continuing or would result from the making of the Loans. (h) Representations and Warranties. All of the representations and warranties contained in Section 7.1 and in any of the other Loan Documents shall be true and correct in all material respects on and as of the Initial Funding Date (other than representations and warranties which expressly speak as to a different specific date, which shall be true and correct as of such date). (i) Fees and Expenses Paid. There shall have been paid to the Co-Agents, for the accounts of the Co-Agents and the Lenders, as applicable, all fees due and payable on or before the Initial Funding Date and all expenses due and payable on or before the Initial Funding Date, including, without limitation, reasonable attorneys' fees and expenses, and other costs and expenses incurred in connection with the Loan Documents. (ii) Committed Financing. The Borrower shall have: (i) obtained from lenders or investors acceptable to the Co-Agents and delivered to the Co-Agents copies of bona fide written commitments for equity or unsecured debt financing available or to be funded to the Borrower on the date hereof in an aggregate amount which, when added to the Loan Commitments, equals $235,000,000; (ii) delivered to the Co-Agents a schedule acceptable to the Co-Agents of the Borrower's sources and uses of funds for the twelve calendar months following the date hereof; and (iii) given the Co-Agents reasonably detailed written notice of all other requests, proposals, expressions of interest, offers, commitments and letters of intent for unsecured debt financing given or received 39 by or on behalf of the Borrower that is proposed first to be funded or available to the Borrower on or before the date hereof. (i) Repayment of Other Facilities. The Borrower shall have repaid in full all of its obligations, and all commitments of the lenders shall have terminated, under that certain Credit Agreement dated as of January 31, 2000 among the Partnership, Dresdner Bank, AG, New York and Grand Cayman Branches, as agent and a lender thereunder, and the other lenders identified therein and all guarantees delivered in connection with such Credit Agreement shall have been terminated and be of no further force and effect. (j) Covenant Calculations. The Borrower shall have delivered to the Co-Agents pro forma calculations of the financial covenants and ratios described in Article X hereof as of the end of the first calendar quarter after the Closing Date, in form as provided in Sections 8.2(a)(iii)(B) and 8.2(b)(iii)(B) hereof for such calculations and otherwise in form and substance satisfactory to the Co-Agents. 6.2. Conditions Precedent to All Subsequent Loans. The obligation of each Lender to make any Loan pursuant to Article III requested to be made by it on any date after the Initial Funding Date is subject to the following conditions precedent as of each such date: (a) Representations and Warranties. As of such date, both before and after giving effect to the Loans to be made on such date, all of the representations and warranties of the Borrower contained in Section 7.1 and in any other Loan Document shall be true and correct in all material respects (other than representations and warranties which expressly speak as of a different date, which shall be true and correct as of such date, and other than representations and warranties with respect to which the Borrower has disclosed to the Co-Agents in writing that the facts are not as represented therein and the Co-Agents have approved or consented to, conditionally or otherwise, the facts as so disclosed by the Borrower). (b) No Defaults. No Event of Default or Potential Event of Default shall have occurred and be continuing or would result from the making of the requested Loan. (c) No Legal Impediments. No law, regulation, order, judgment or decree of any Governmental Authority shall, and the Co-Agents shall not have received from any Lender notice that, in the judgment of such Lender, litigation is pending or threatened which is likely to, enjoin, prohibit or restrain, or impose or result in the imposition of any material adverse condition upon, such Lender's making the requested Loan. (d) No Material Adverse Effect. The Borrower shall not have received written notice from the Requisite Lenders that an event has occurred since the date of this Agreement which has had and continues to have, will have or is reasonably likely to have, a Material Adverse Effect. Each submission by the Borrower to the Administrative Agent of a notice of borrowing with respect to a Borrowing or a Notice of Conversion/Continuation with respect to any Loan and each acceptance by the Borrower of the proceeds of each Loan made, converted or continued hereunder, shall constitute a representation and warranty by the Borrower as of the Funding Date in respect of such Borrowing or Loan and the date of conversion or continuation, that all the 40 conditions contained in this Section 6.2 have been satisfied or waived in accordance with Section 15.7. ARTICLE VII REPRESENTATIONS AND WARRANTIES 7.1. Representations and Warranties of the Borrower. In order to induce the Lenders to enter into this Agreement and to make the Loans and the other financial accommodations to the Borrower described herein, the Borrower hereby represents and warrants to each Lender that the following statements are true, correct and complete: (a) Organization; Powers. (i) The Partnership (A) is a limited partnership duly formed, validly existing and in good standing under the laws of the State of Delaware, (B) is duly qualified to do business and is in good standing under the laws of each jurisdiction in which failure to be so qualified and in good standing will have or is reasonably likely to have a Material Adverse Effect, (C) has all requisite partnership power and authority to own, operate and encumber its Property and to conduct its business as presently conducted and as proposed to be conducted in connection with and following the consummation of the transactions contemplated by this Agreement and (D) is a partnership for federal income tax purposes. (ii) The Company (A) is a Delaware limited liability company duly formed, validly existing and in good standing under the laws of the State of Delaware, (B) is duly qualified to do business and is in good standing under the laws of each jurisdiction in which failure to be so qualified and in good standing will have or is reasonably likely to have a Material Adverse Effect, (C) has all requisite limited liability company power and authority to own, operate and encumber its Property and to conduct its business as presently conducted and as proposed to be conducted in connection with and following the consummation of the transactions contemplated by this Agreement and (D) is a partnership for federal income tax purposes. The Partnership is a member of the Company, holding 911,900 common units of membership interest in the Company. The only other members of the Company are (x) Goldman Sachs 2000 Exchange Place Fund, L.P. (a limited partnership of which Goldman, Sachs or an entity controlled thereby is the sole general partner), which holds 700,000 Series A preferred units of membership interest in the Company; (y) Caledonian Holding Company, Inc. (a corporation which is an Affiliate of the Partnership), which holds 29,600 common units of membership in the Company; and (z) GGP American Properties Inc. (a corporation which is an Affiliate of the Partnership), which holds 58,500 common units of membership interest in the Company. There are no holders of common units of membership interest in the Company other than as set forth above. (iii) GGP, Inc. (A) is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware, (B) is duly authorized and qualified to do business and is in good standing under the laws of each jurisdiction in 41 which failure to be so qualified and in good standing will have or is reasonably likely to have a Material Adverse Effect, and (C) has all requisite corporate power and authority to own, operate and encumber its Property and to conduct its business as presently conducted. (iv) True, correct and complete copies of the Organizational Documents identified on Schedule 7.1A have been delivered to the Co-Agents, each of which is in full force and effect, has not been modified or amended except to the extent indicated therein and, to the best of the Borrower's knowledge, there are no defaults under such Organizational Documents and no events which, with the passage of time or giving of notice or both, would constitute a default under such Organizational Documents. (v) Neither Borrower nor any of its Affiliates are "foreign persons" within the meaning of Section 1445 of the Internal Revenue Code. (b) Authority. (i) The Partnership is the sole managing member of the Company, and no other member of the Company has any decision-making authority in connection with the business, assets, liabilities, operations or other affairs of the Company. GGP, Inc. is the sole general partner of the Partnership. (ii) GGP, Inc., (A) for itself, (B) in its capacity as the sole general partner of the Partnership, in respect of the Partnership, and (C) in its capacity as the sole general partner of the Partnership, in the Partnership's capacity as the sole managing member of the Company, in respect of the Company, has the requisite power and authority to execute, deliver and perform this Agreement on behalf of the Borrower and each of the other Loan Documents which are required to be executed for itself and on behalf of the Borrower as required by this Agreement. GGP, Inc. is the Person who has executed this Agreement and such other Loan Documents for itself and on behalf of the Borrower. (iii) The execution, delivery and performance of each of the Loan Documents which must be executed in connection with this Agreement by GGP, Inc. or the Borrower and to which GGP, Inc. or the Borrower is a party and the consummation of the transactions contemplated thereby are within GGP, Inc.'s corporate powers, the Partnership's partnership powers and the Company's limited liability company powers, as applicable, have been duly authorized by all necessary corporate action, partnership action or limited liability action, as applicable and such authorization has not been rescinded. No other partnership, limited liability company or corporate action or proceedings on the part of the Borrower or GGP, Inc. is necessary to consummate such transactions. (iv) Each of the Loan Documents to which GGP, Inc. or the Borrower is a party has been duly executed and delivered on behalf of GGP, Inc. or the Borrower, as applicable, and constitutes the legal, valid and binding obligation of GGP, Inc. or the 42 Borrower, as applicable, enforceable against GGP, Inc. or the Borrower, as applicable, in accordance with its terms (except to the extent that the enforcement thereof or the availability of equitable remedies may be limited by applicable bankruptcy, reorganization, insolvency, moratorium, fraudulent transfer, fraudulent conveyance or similar laws now or hereafter in effect relating to or affecting creditors' rights generally or by general principles of equity, or by the discretion of any court in awarding equitable remedies, regardless of whether such enforcement is considered in a preceding in equity or at law), is in full force and effect and all the terms, provisions, agreements and conditions set forth therein and required to be performed or complied with by GGP, Inc. or the Borrower, as applicable, on or before the Initial Funding Date have been performed or complied with, and no Potential Event of Default, Event of Default or breach of any covenant by GGP, Inc. or the Borrower, as applicable, exists thereunder. (c) Subsidiaries; Ownership of Capital Stock and Partnership Interests. (i) Schedule 7.1C (A) contains a diagram indicating the structure of the Borrower, and any other Person in which the Borrower holds a direct or indirect partnership, membership, joint venture or other equity interest, indicating the nature of such interest with respect to each Person included in such diagram; and (B) accurately sets forth the correct legal name of such Person, the jurisdiction of its incorporation or organization and the jurisdictions in which it is qualified to transact business as a foreign corporation, or otherwise. None of the authorized, issued and outstanding shares or interests of each class of Securities issued by the Borrower is subject to any vesting, redemption, or repurchase agreement, and there are no warrants or options outstanding with respect to such Securities, except as noted on Schedule 7.1C. (ii) The outstanding Capital Stock issued by GGP, Inc. is duly authorized, validly issued, fully paid and nonassessable and the outstanding Securities issued by the Borrower and, to the extent owned by Borrower, its Subsidiaries are duly authorized and validly issued. The Borrower has previously delivered to the Co-Agents a true, accurate and complete copy of the Borrower Partnership Agreement and the Borrower Operating Agreement, each as amended through and as in effect on the Closing Date, and neither the Borrower Partnership Agreement nor the Borrower Operating Agreement has been amended, supplemented, replaced, restated or otherwise modified in any respect since the Closing Date. (iii) Except where failure may not have a Material Adverse Effect on the Borrower, each Subsidiary: (A) is a corporation, limited liability company, trust or partnership, as indicated on Schedule 7.1C, duly organized or formed, validly existing and, if applicable, in good standing under the laws of the jurisdiction of its organization; (B) is duly qualified to do business and, if applicable, is in good standing under the laws of each jurisdiction in which failure to be so qualified and in good standing would limit its ability to use the courts of such jurisdiction to enforce Contractual Obligations to which it is a party; and (C) has all requisite power and authority to own, operate and encumber its Property and to conduct its business as presently conducted and as proposed to be conducted hereafter. 43 (d) No Conflict. The execution, delivery and performance of each of the Loan Documents to which GGP, Inc. or the Borrower is a party do not and will not (i) conflict with the Organizational Documents of GGP, Inc. or the Borrower, as applicable, (ii) constitute a tortious interference with any Contractual Obligation of any Person or conflict with, result in a breach of or constitute (with or without notice or lapse of time or both) a default under any Requirement of Law or Contractual Obligation of GGP, Inc. or the Borrower, as applicable, or require termination of any such Contractual Obligation which may subject either the Co-Agent or any of the Lenders to any liability or which is reasonably likely to have a Material Adverse Affect, (iii) result in or require the creation or imposition of any Lien whatsoever upon any of the Property or assets of GGP, Inc. or the Borrower or any Subsidiary of the Borrower, or (iv) require any approval of shareholders of GGP, Inc. (e) Governmental Consents. The execution, delivery and performance of each of the Loan Documents to which GGP, Inc. or the Borrower is a party do not and will not require any registration with, consent or approval of, or notice to, or other action to, with or by any Governmental Authority, except filings, consents or notices which have been made, obtained or given. (f) Governmental Regulation. Neither the Borrower nor GGP, Inc. is subject to regulation under the Public Utility Holding Company Act of 1935, the Federal Power Act, the Interstate Commerce Act, or the Investment Company Act of 1940, or any other federal or state statute or regulation which limits its ability to incur indebtedness or its ability to consummate the transactions contemplated by this Agreement. (g) Financial Position. Complete and accurate copies of the following financial statements and materials have been delivered to the Co-Agents: (i) annual audited financial statements of GGP, Inc. and its Consolidated Subsidiaries for the fiscal year ended December 31, 1999, and (ii) quarterly financial statements for the Borrower and its Consolidated Subsidiaries for the fiscal quarter ending March 31, 2000. All financial statements included in such materials were prepared in all material respects in conformity with GAAP, except as otherwise noted therein, and fairly present in all material respects the respective Consolidated financial positions, and the Consolidated results of operations and cash flows for each of the periods covered thereby of GGP, Inc. or the Borrower, as applicable, and its Consolidated Subsidiaries as at the respective dates thereof. Neither the Borrower nor any of its Consolidated Subsidiaries has any Contingent Obligation, contingent liability or liability for any taxes, long-term leases or commitments, not reflected in its audited financial statements delivered to the Co-Agents on or prior to the Closing Date or otherwise disclosed to the Co-Agents and the Lenders in writing, which will have or is reasonably likely to have a Material Adverse Effect. (h) Indebtedness. Schedule 7.1H sets forth, as of June 30, 2000, all Indebtedness for borrowed money of each of the Borrower and its respective Subsidiaries and, except as set forth on Schedule 7.1H, there are no defaults in the payment of principal or interest on any such Indebtedness and no payments thereunder have been deferred or extended beyond their stated maturity and there has been no material change in the type or amount of such Indebtedness (except for the repayment or refinance of certain Indebtedness) since June 30, 2000. 44 (i) Litigation: Adverse Effects. Except as set forth in Schedule 7.1I, as of the Closing Date, there is no action, suit, proceeding, Claim, investigation or arbitration before or by any Governmental Authority or private arbitrator pending or, to the knowledge of the Borrower, threatened against GGP, Inc. or the Borrower, or any of their respective Subsidiaries, or any Property of any of them (i) challenging the validity or the enforceability of any of the Loan Documents, (ii) which will or is reasonably likely to result in any Material Adverse Effect, or (iii) under the Racketeering Influenced and Corrupt Organizations Act or any similar federal or state statute where such Person is a defendant in a criminal indictment that provides for the forfeiture of assets to any Governmental Authority as a potential criminal penalty. There is no material loss contingency within the meaning of GAAP which has not been reflected in the Consolidated financial statements of the Borrower. None of GGP, Inc., the Borrower or any Subsidiary of the Borrower is (A) in violation of any applicable Requirements of Law, which violation has had, will have or is reasonably likely to have a Material Adverse Effect, or (B) subject to or in default with respect to any final judgment, writ, injunction, restraining order or order of any nature, decree, rule or regulation of any court or Governmental Authority which has had, will have or is reasonably likely to have a Material Adverse Effect. (j) No Material Adverse Effect. Since March 31, 2000, there has occurred no event which has had, will have or is reasonably likely to have a Material Adverse Effect. (k) Tax Examinations. All deficiencies which have been asserted against GGP, Inc. or the Borrower as a result of any federal, state, local or foreign tax examination for each taxable year in respect of which an examination has been conducted have been fully paid or finally settled or are being contested in good faith, and no issue has been raised in any such examination which, by application of similar principles, reasonably can be expected to result in assertion of a material deficiency for any other year not so examined which has not been reserved for in the financial statements of GGP, Inc. or the Borrower, as applicable, to the extent, if any, required by GAAP. The Borrower has not taken any reporting positions for which it does not have a reasonable basis nor does the Borrower anticipate any further material tax liability with respect to the years which have not been closed pursuant to applicable law. (l) Payment of Taxes. All tax returns, reports and similar statements or filings of GGP, Inc., the Borrower and its Subsidiaries required to be filed have been timely filed, and, except for Customary Permitted Liens, all taxes, assessments, fees and other charges of Governmental Authorities thereupon and upon or relating to their respective Properties, assets, receipts, sales, use, payroll, employment, income, licenses and franchises which are shown in such returns or reports to be due and payable have been paid, except to the extent (i) such taxes, assessments, fees and other charges of Governmental Authorities are being contested in good faith by an appropriate proceeding diligently pursued as permitted by the terms of Section 9.4 and (ii) such taxes, assessments, fees and other charges of Governmental Authorities pertain to Property of GGP, Inc., the Borrower or any of its Subsidiaries and the nonpayment of the amounts thereof would not, individually or in the aggregate, result in a Material Adverse Effect. All other taxes (including, without limitation, real estate taxes), assessments, fees and other governmental charges upon or relating to the respective Properties of GGP, Inc., the Borrower and its Subsidiaries which are due and payable have been paid, except for Customary Permitted Liens and except to the extent described in clauses (i) and (ii) above. The Borrower has no knowledge of any proposed tax assessment against GGP, Inc., the Borrower, any of their 45 respective Subsidiaries, or any of their respective Properties that, if not paid, will have or is reasonably likely to have a Material Adverse Effect. (m) Performance. None of GGP, Inc., the Borrower or any of its Subsidiaries has received any notice, citation or allegation, nor has actual knowledge, that (i) it is in default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any Contractual Obligation applicable to it, (ii) any of its Properties is in violation of any Requirements of Law or (iii) any condition exists which, with the giving of notice or the lapse of time or both, would constitute a default with respect to any such Contractual Obligation, in each case, except where such default or defaults, if any, has not had, will not have and is not reasonably likely to have a Material Adverse Effect. (n) Disclosure. The representations and warranties of GGP, Inc. and the Borrower contained in the Loan Documents, and all certificates and other documents delivered to the Co-Agents pursuant to the terms thereof, do not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained herein or therein, in light of the circumstances under which they were made, not misleading. The Borrower has not intentionally withheld any fact from the Co-Agents or the Lenders in regard to any matter which will have or is reasonably likely to have a Material Adverse Effect. Notwithstanding the foregoing, the Lenders acknowledge that the Borrower does not have liability under this clause (n) with respect to its projections of future events. (o) Requirements of Law. GGP, Inc., the Borrower and each of its Subsidiaries is in compliance in all material respects with all Requirements of Law applicable to it and its respective businesses and Properties, in each case where the failure to so comply individually or in the aggregate will have or is reasonably likely to have a Material Adverse Effect. (p) Environmental Matters. (i) Except as could not, individually or in the aggregate, be reasonably expected to have a Material Adverse Effect: (A) the operations of the Borrower, each of its Subsidiaries, and their respective Properties comply in all respects with all applicable Environmental, Health or Safety Requirements of Law; (B) the Borrower and each of its Subsidiaries have obtained all environmental, health and safety Permits necessary for their respective operations, and all such Permits are in good standing and the holder of each such Permit is currently in compliance in all respects with all terms and conditions of such Permits; (C) none of the Borrower or any of its Subsidiaries or any of their respective present or, to the Borrower's knowledge, past Property or operations is subject to or is the subject of any investigation, judicial or administrative proceeding, order, judgment, decree, dispute, negotiations, agreement or settlement respecting (1) any Environmental, Health or 46 Safety Requirements of Law, (2) any Remedial Action, (3) any Claims or Liabilities and Costs arising from the Release or threatened Release of a Contaminant into the environment, or (4) any violation of or liability under any Environmental, Health or Safety Requirement of Law; (D) none of Borrower or any of its Subsidiaries has filed any notice under any applicable Requirement of Law (1) reporting a Release of a Contaminant; (2) indicating past or present treatment, storage or disposal of a hazardous waste, as that term is defined under 40 C.F.R. Part 261 or any state equivalent; or (3) reporting a violation of any applicable Environmental, Health or Safety Requirement of Law; (E) none of the Borrower's or any of its Subsidiaries' present or, to Borrower's knowledge, past Property presently is listed or proposed for listing on the National Priorities List ("NPL") pursuant to CERCLA or on the Comprehensive Environmental Response Compensation Liability Information System List ("CERCLIS") or any similar state list of sites requiring Remedial Action; (F) neither the Borrower nor any of its Subsidiaries has sent or directly arranged for the transport of any waste to any site listed or proposed for listing on the NPL, CERCLIS or any similar state list; (G) there is not now, and to Borrower's knowledge there has never been on or in any Real Property of the Borrower or any of its Subsidiaries (1) any treatment, recycling, storage or disposal of any hazardous waste, as that term is defined under 40 C.F.R. Part 261 or any state equivalent; (2) any landfill, waste pile, or surface impoundment; (3) any underground storage tanks the presence or use of which is or, to Borrower's knowledge, has been in violation of applicable Environmental, Health or Safety Requirements of Law, (4) any asbestos-containing material; or (5) any polychlorinated biphenyls (PCB) used in hydraulic oils, electrical transformers or other Equipment; (H) neither the Borrower nor any of its Subsidiaries has received any notice or Claim to the effect that any of the Borrower or its Subsidiaries is or may be liable to any Person as a result of the Release or threatened Release of a Contaminant into the environment; (I) to the Borrower's knowledge, neither the Borrower nor any of its Subsidiaries has any contingent liability in connection with any Release or threatened Release of any Contaminants into the environment; (J) no Environmental Lien is presently recorded with respect to any Property of the Borrower or any Subsidiary of the Borrower; (K) no Property of the Borrower or any Subsidiary of the Borrower is subject to any Environmental Property Transfer Act, or to the 47 extent such acts are applicable to any such Property, the Borrower and/or such Subsidiary whose Property is subject thereto has fully complied with the requirements of such acts; and (L) neither the Borrower nor any of its Subsidiaries owns or operates, or, to the Borrower's knowledge, has ever owned or operated, any underground storage tank, the presence or use of which is or has been in violation of applicable Environmental, Health or Safety Requirements of Law, at any Real Property. (ii) the Borrower and each of its Subsidiaries are conducting and will continue to conduct their respective businesses and operations and maintain each Real Property in compliance in all material respects with applicable Environmental, Health or Safety Requirements of Law and neither the Borrower nor any of its Subsidiaries has been or has any reason to believe that it or any of its Property will be subject to Liabilities and Costs arising out of or relating to environmental, health or safety matters that could individually or in the aggregate be reasonably expected to result in a Material Adverse Effect. (q) ERISA. Neither the Borrower nor any ERISA Affiliate maintains or contributes to any Benefit Plan or Multiemployer Plan other than those listed on Schedule 7.1Q hereto. Each Plan which is intended to be qualified under Section 401(a) of the Internal Revenue Code as currently in effect has been determined by the IRS to be so qualified, and each trust related to any such Plan has been determined to be exempt from federal income tax under Section 501(a) of the Internal Revenue Code as currently in effect. Except as disclosed in Schedule 7.1Q, neither the Borrower nor any of its Subsidiaries maintains or contributes to any "employee welfare benefit plan" within the meaning of Section 3(1) of ERISA which provides benefits to employees after termination of employment other than as required by Section 601 of ERISA. The Borrower and each of its Subsidiaries is in compliance in all material respects with the responsibilities, obligations and duties imposed on it by ERISA, the Internal Revenue Code and regulations promulgated thereunder with respect to all Plans. No Benefit Plan has incurred any accumulated funding deficiency (as defined in Sections 302(a)(2) of ERISA and 412(a) of the Internal Revenue Code) whether or not waived. Neither the Borrower nor any ERISA Affiliate nor any fiduciary of any Plan which is not a Multiemployer Plan (i) has engaged in a nonexempt prohibited transaction described in Sections 406 of ERISA or 4975 of the Internal Revenue Code with respect to which the Borrower can be subject to any liability or (ii) has taken or failed to take any action which would constitute or result in an ERISA Termination Event. Neither the Borrower nor any ERISA Affiliate is subject to any liability under Sections 4063, 4064, 4069, 4204 or 4212(c) of ERISA. Neither the Borrower nor any ERISA Affiliate has incurred any liability to the PBGC which remains outstanding other than the payment of premiums, and there are no premium payments which have become due which are unpaid. Schedule B to the most recent annual report filed with the IRS (i.e. IRS Form 5500) with respect to each Benefit Plan and furnished to the Co-Agents is complete and accurate in all material respects. Since the date of each such Schedule B, there has been no material adverse change in the funding status or financial condition of the Benefit Plan relating to such Schedule B. Neither the Borrower nor any ERISA Affiliate has (i) failed to make a required contribution or payment to a Multiemployer Plan or (ii) made a complete or partial withdrawal under Sections 4203 or 48 4205 of ERISA from a Multiemployer Plan. Neither the Borrower nor any ERISA Affiliate has failed to make a required installment or any other required payment under Section 412 of the Internal Revenue Code on or before the due date for such installment or other payment. Neither the Borrower nor any ERISA Affiliate is required to provide security to a Benefit Plan under Section 401(a)(29) of the Internal Revenue Code due to a Benefit Plan amendment that results in an increase in current liability for the plan year. Except as disclosed on Schedule 7.1Q, neither the Borrower nor any of its Subsidiaries has, by reason of the transactions contemplated hereby, any obligation to make any payment to any employee pursuant to any Plan or existing contract or arrangement. (r) Securities Activities. Neither the Borrower nor any of its Subsidiaries is engaged in the business of extending credit for the purpose of purchasing or carrying Margin Stock. (s) Solvency. After giving effect to the Loans to be made on the Initial Funding Date or such other date as Loans requested hereunder are made, and the disbursement of the proceeds of such Loans pursuant to the Borrower's instructions, each of the Borrower and GGP, Inc. is Solvent. (t) Insurance. Schedule 7.1T accurately sets forth as of the Closing Date all insurance policies and programs currently in effect with respect to the respective Property and assets and business of the Borrower and its Subsidiaries, specifying for each such policy and program, (i) the amount thereof, (ii) the risks insured against thereby, (iii) the name of the insurer and each insured party thereunder, (iv) the policy or other identification number thereof, and (v) the expiration date thereof. Such insurance policies and programs are currently in full force and effect, in compliance with the requirements of Section 9.5 hereof and, together with payment by the insured of scheduled deductible payments, are in amounts sufficient to cover the replacement value of the respective Property and assets of the Borrower and/or its Subsidiaries. (u) REIT Status. GGP, Inc. qualifies as a REIT under the Internal Revenue Code. (v) Ownership of Property. Ownership of substantially all Property of the Consolidated Businesses is held by the Borrower and its Subsidiaries. (w) Year 2000 Issues. The Borrower has reviewed and assessed its and its Subsidiaries' business operations and computer systems and applications to address the "year 2000 problem" (i.e., the risk that computer applications and equipment used by the Borrower, directly or indirectly through third parties, may have been or may be unable properly to perform date-sensitive functions before, during or after January 1, 2000), and the "year 2000 problem" has not resulted in and is not reasonably expected to result in a Material Adverse Effect on the business, financial condition, operations or Properties of the Borrower or any of its Subsidiaries, or on the ability of the Borrower to repay the Loans and otherwise fulfill its Obligations under this Agreement. The Borrower shall promptly deliver to the Co-Agents all information relating to this representation that the Co-Agents may reasonably request. 49 ARTICLE VIII REPORTING COVENANTS The Borrower covenants and agrees that until payment in full of all of the Obligations (other than indemnities pursuant to Section 15.3 not yet due): 8.1. Borrower Accounting Practices. The Borrower shall maintain, and cause each of its Subsidiaries to maintain, a system of accounting established and administered in accordance with sound business practices to permit preparation of Consolidated and consolidating financial statements in conformity with GAAP, and each of the financial statements and reports described below shall be prepared from such system and records and in form satisfactory to the Co-Agents. 8.2. Financial Reports. The Borrower shall deliver or cause to be delivered to the Co-Agents and the Lenders: (a) Quarterly Reports. (i) Borrower Quarterly Financial Reports. As soon as practicable, and in any event within forty-five (45) days after the end of each fiscal quarter in each Fiscal Year (other than the last fiscal quarter in each Fiscal Year), an unaudited Consolidated balance sheet of the Borrower and the related Consolidated statements of income and cash flow of the Borrower (to be prepared and delivered quarterly in conjunction with the other reports delivered hereunder at the end of each fiscal quarter) for each such fiscal quarter, in each case in form and substance satisfactory to the Co-Agents and, in comparative form, the corresponding figures for the corresponding periods of the previous Fiscal Year, certified by an Authorized Financial Officer of GGP, Inc. as fairly presenting the Consolidated and consolidating financial position of the Borrower and its Consolidated Subsidiaries as of the dates indicated and the results of its operations and cash flow for the months indicated in accordance with GAAP, subject to normal quarterly adjustments. (ii) GGP, Inc. Quarterly Financial Reports. As soon as practicable, and in any event within forty-five (45) days after the end of each fiscal quarter in each Fiscal Year (other than the last fiscal quarter in each Fiscal Year), the Financial Statements of GGP, Inc. and its Subsidiaries on Form 10Q as at the end of such period and a report setting forth in comparative form the corresponding figures for the corresponding period of the previous Fiscal Year, certified by an Authorized Financial Officer of GGP, Inc. as fairly presenting the Consolidated and consolidating financial position of GGP, Inc. and its Subsidiaries as of the date indicated and the results of its operations and cash flow for the period indicated in accordance with GAAP, subject to normal adjustments. (iii) Quarterly Compliance Certificates. Together with each delivery of any quarterly report pursuant to paragraph (a)(i) of this Section 8.2, the Borrower shall deliver an Officer's Certificate of the Borrower (the "Quarterly Compliance 50 Certificates"), signed by the Borrower's respective Authorized Financial Officers setting forth, representing and certifying (A) that the Authorized Financial Officer signatory thereto has reviewed the terms of the Loan Documents, and has made, or caused to be made under his/her supervision, a review in reasonable detail of the transactions and Consolidated and consolidating financial condition of the Borrower and its Subsidiaries, during the fiscal quarter covered by such reports, that such review has not disclosed the existence during or at the end of such fiscal quarter, and that such officer does not have knowledge of the existence as of the date of such Officer's Certificate, of any condition or event which constitutes an Event of Default or Potential Event of Default or mandatory prepayment event as described in Section 4.1(c) of this Agreement, or, if any such condition or event existed or exists, and specifying the nature and period of existence thereof and what action the Borrower or any of its Subsidiaries has taken, is taking and proposes to take with respect thereto; (B) the calculations (in the form of Exhibit E hereto and otherwise with such specificity as the Co-Agents may reasonably request) for the period then ended which demonstrate compliance with the covenants and financial ratios set forth in Articles IX and X and, when applicable, that no Event of Default described in Section 11.1 exists, (C) a schedule of changes, if any, in the Borrower's outstanding Indebtedness for borrowed money, including the amount, maturity, interest rate and amortization requirements, as well as such other information regarding such Indebtedness as may be reasonably requested by the Co-Agents, since the last date on which such a schedule was submitted, (D) a schedule of Combined EBITDA, (E) a schedule of each bankruptcy or cessation of operations of any tenant to which greater than 5% of the Borrower's share of consolidated minimum rent is attributable, of which bankruptcy or cessation of operations the Borrower obtained knowledge since the last date on which such a schedule was submitted, together with such other information reasonably satisfactory to the Co-Agents as to the square footage and total rent payable by any such tenants of any such Real Properties and (F) such other information and reports as the Administrative Agent may reasonably request. (b) Annual Reports. (i) Borrower Financial Statements. As soon as practicable, and in any event within ninety (90) days after the end of each Fiscal Year, (A) the unaudited Consolidated balance sheet of the Borrower and the related Consolidated statements of income and cash flow of the Borrower for such Fiscal Year, in each case in form and substance satisfactory to the Co-Agents and, in comparative form, the corresponding figures for the previous Fiscal Year, certified by an Authorized Financial Officer of GGP, Inc. as fairly presenting the Consolidated and Consolidating financial position of each of the Borrower and its Consolidated Subsidiaries as at the dates indicated and the results of their operations and cash flow for the periods indicated in conformity with GAAP applied on a basis consistent with prior years, and (B) a copy of any management letter or any similar written report delivered to the Borrower or GGP, Inc. or to any Authorized Financial Officer thereof by any independent certified public accountants or other independent consultant in connection with or relating to such financial statements (which letter or report shall be subject to the confidentiality limitations set forth herein). The Co-Agents and each Lender (through the Administrative Agent) may, with the consent of the Borrower (which consent shall not be unreasonably withheld), communicate directly 51 with such accountants or consultant, with any such communication to occur together with a representative of the Borrower, at the expense of the Co-Agents (or the Lender requesting such communication), upon reasonable notice and at reasonable times during normal business hours. (ii) GGP, Inc. Annual Financial Reports. As soon as practicable, and in any event within ninety (90) days after the end of each Fiscal Year, (A) the financial statements of GGP, Inc. and its Consolidated Subsidiaries as at the end of such period, and a report setting forth in comparative form the corresponding figures for the previous Fiscal Year, (B) an audit report with respect thereto by any independent certified public accountants reasonably acceptable to the Co-Agents, which report shall be unqualified and shall state that such financial statements fairly present the Consolidated and consolidating financial position of GGP, Inc. and its consolidating Subsidiaries as of the date indicated and the results of its operations and cash flow for the period indicated in conformity with GAAP applied on a basis consistent with prior years (except for changes with which any such independent certified public accountants shall concur and which shall have been disclosed in the notes to the financial statements), and (C) a copy of the management letter or any similar written report delivered to GGP, Inc. or to any Authorized Financial Officer thereof by such independent certified public accountants or any other independent consultant in connection with or relating to such financial statements (which letter or report shall be subject to the confidentiality limitations set forth herein). The Co-Agents and each Lender (through the Administrative Agent) may, with the consent of the Borrower (which consent shall not be unreasonably withheld), communicate directly with such accountants or consultant, with any such communication to occur together with a representative of the Borrower, at the expense of the Co-Agents (or the Lender requesting such communication), upon reasonable notice and at reasonable times during normal business hours. (iii) Annual Compliance Certificates. Together with each delivery of any annual report pursuant to clause (i) of this Section 8.2(b), the Borrower shall deliver Officer's Certificates of the Borrower (the "Annual Compliance Certificates" and, collectively with the Quarterly Compliance Certificates, the "Compliance Certificates"), signed by the Borrower's respective Authorized Financial Officers, setting forth, representing and certifying (A) that the officer signatory thereto has reviewed the terms of the Loan Documents, and has made, or caused to be made under his/her supervision, a review in reasonable detail of the transactions and Consolidated and Consolidating financial condition of the Borrower and its Subsidiaries, during the accounting period covered by such reports, that such review has not disclosed the existence during or at the end of such accounting period, and that such officer does not have knowledge of the existence as at the date of such Officer's Certificate, of any condition or event which constitutes an Event of Default or Potential Event of Default or mandatory prepayment event as described in Section 4.1(c) of this Agreement, or, if any such condition or event existed or exists, and specifying the nature and period of existence thereof and what action the Borrower or any of its Subsidiaries has taken, is taking and proposes to take with respect thereto; (B) the calculations (in the form of Exhibit E and otherwise with such specificity as the Co-Agents may reasonably request) for the period then ended which demonstrate compliance with the covenants and financial ratios set forth in 52 Articles IX and X and, when applicable, that no Event of Default described in Section 11.1 exists, (C) a schedule of the Borrower's outstanding Indebtedness for borrowed money including the amount, maturity, interest rate and amortization requirements, as well as such other information regarding such Indebtedness as may be reasonably requested by the Co-Agents, (D) a schedule of Combined EBITDA, (E) a schedule of the estimated taxable income of the Borrower for such fiscal year, (F) a statement of net operating income and a schedule of tenant sales and occupancy with respect to each Real Property, (G) pro forma statements of operations (including, without limitation, projections of net operating income and interest expense for each Real Property) and sources and uses of capital for the next 24 months of the operations of GGP, Inc. and the Borrower, together with a capital plan for such 24 month period, all in form, content and detail reasonably acceptable to the Co-Agents, and (H) such other information and reports as either Co-Agent may reasonably request. (iv) Tenant Bankruptcy Reports. As soon as practicable, and in any event within ninety (90) days after the end of each Fiscal Year, the Borrower shall deliver a written report (which shall be incorporated into the Annual Compliance Certificate), in form reasonably satisfactory to the Co-Agents, of all bankruptcy proceedings filed by or against, or the cessation of business or operations of, any tenant of any of the Real Properties of the Borrower or any of its Subsidiaries, the base rent payments of which tenant account for more than five percent (5%) of the Borrower's share of consolidated minimum rent in the Real Properties in the aggregate, together with such other information reasonably satisfactory to the Co-Agents as to the square footage and total rent payable by any such tenants of any such Real Properties. (c) Reports of Capital Events. On the date of consummation and funding of each Capital Event, the Borrower shall submit to the Co-Agents a reasonably detailed report thereof, which shall include a computation of the Leverage Ratio after giving effect thereto, and which shall be otherwise reasonably acceptable in form and substance to the Co-Agents. (d) Information Regarding the Borrower. From time to time upon request by either Co-Agent, the Borrower shall deliver to such Co-Agents such information, reports and documents concerning the Borrower as such Co-Agent may reasonably request. 8.3. Events of Default. Promptly upon the Borrower obtaining knowledge (a) of any condition or event which constitutes an Event of Default or Potential Event of Default, (b) that any Lender or either Co-Agent has given any notice with respect to a claimed Event of Default or Potential Event of Default, (c) that any Person has given any notice to the Borrower or taken any other action with respect to a claimed default or event or condition of the type referred to in Section 11.1(e), or (d) of any condition or event which has or is reasonably likely to have a Material Adverse Effect, the Borrower shall deliver to the Co-Agents and the Lenders an Officer's Certificate specifying (i) the nature and period of existence of any such claimed default, Event of Default, Potential Event of Default, condition or event, (ii) the notice given or action taken by such Person in connection therewith, and (iii) what action the Borrower has taken, is taking and proposes to take with respect thereto. 53 8.4. Lawsuits. (i) Promptly upon the Borrower's obtaining knowledge of the institution of, or written threat of, any action, suit, proceeding, governmental investigation or arbitration against or affecting the Borrower or any of its Subsidiaries of the type described in Section 7.1(i) of this Agreement not previously disclosed pursuant to Section 7.1(i), the Borrower shall give written notice thereof to the Co-Agents and the Lenders and provide such other information as may be reasonably available to enable each Lender and each Co-Agent and each Co-Agent's counsel to evaluate such matters; (ii) as soon as practicable and in any event within forty-five (45) days after the end of each fiscal quarter of the Borrower, the Borrower shall provide a written quarterly report to the Co-Agents and the Lenders (which may be incorporated into the Quarterly Compliance Certificate) covering the institution of, or written threat of, any action, suit, proceeding, governmental investigation or arbitration of the type described in Section 7.1(i) of this Agreement (not previously reported) and involving a Claim which is uninsured against or affecting the Borrower or any of its Subsidiaries or any Property of the Borrower or any of its Subsidiaries not previously disclosed by the Borrower to the Co-Agents and the Lenders, and shall provide such other information at such time as may be reasonably available to enable each Lender and each Co-Agent and each Co-Agent's counsel to evaluate such matters; and (iii) in addition to the requirements set forth in clauses (i) and (ii) of this Section 8.4, the Borrower upon request of the either Co-Agent or the Requisite Lenders shall promptly give written notice of the status of any action, suit, proceeding, governmental investigation or arbitration covered by a report delivered pursuant to clause (i) or (ii) above and provide such other information as may be reasonably available to it to enable each Lender and the Administrative Agent and its counsel to evaluate such matters. 8.5. Insurance. If requested by either Co-Agent, the Borrower shall promptly deliver to the Co-Agents and the Lenders (i) a report in form and substance reasonably satisfactory to the Co-Agents and the Lenders outlining all insurance coverage maintained as of the date of such report by the Borrower and its Subsidiaries and the duration of such coverage and (ii) the certificate of an Authorized Financial Officer that all premiums with respect to such coverage have been paid when due. 8.6. ERISA Notices. The Borrower shall deliver or cause to be delivered to the Co-Agents and the Lenders, at the Borrower's expense, the following information and notices as soon as reasonably possible, and in any event: (a) within fifteen (15) Business Days after the Borrower or any ERISA Affiliate knows or has reason to know that an ERISA Termination Event has occurred, a written statement of the chief financial officer of the Borrower describing such ERISA Termination Event and the action, if any, which the Borrower or any ERISA Affiliate has taken, is taking or proposes to take with respect thereto, and when known, any action taken or threatened by the IRS, DOL or PBGC with respect thereto; (b) within fifteen (15) Business Days after the Borrower knows or has reason to know that a prohibited transaction (defined in Sections 406 of ERISA and 4975 of the Internal Revenue Code) has occurred, a statement of the chief financial officer of the Borrower describing such transaction and the action which the Borrower or any ERISA Affiliate has taken, is taking or proposes to take with respect thereto; 54 (c) within fifteen (15) Business Days after the filing of the same with the DOL, IRS or PBGC, copies of each annual report (IRS Form 5500 series), including Schedule B thereto, filed with respect to each Benefit Plan; (d) within fifteen (15) Business Days after receipt by the Borrower or any ERISA Affiliate of each actuarial report for any Benefit Plan or Multiemployer Plan and each annual report for any Multiemployer Plan (IRS Form 5500), copies of each such report; (e) within fifteen (15) Business Days after the filing of the same with the IRS, a copy of each funding waiver request filed with respect to any Benefit Plan and all written communications received by the Borrower or any ERISA Affiliate with respect to such request; (f) within fifteen (15) Business Days after the occurrence of any material increase in the benefits of any existing Benefit Plan or Multiemployer Plan or the establishment of any new Benefit Plan or the commencement of contributions to any Benefit Plan or Multiemployer Plan to which the Borrower or any ERISA Affiliate was not previously contributing, notification of such increase, establishment or commencement; (g) within fifteen (15) Business Days after the Borrower or any ERISA Affiliate receives notice of the PBGC's intention to terminate a Benefit Plan or to have a trustee appointed to administer a Benefit Plan, copies of each such notice; (h) within fifteen (15) Business Days after the Borrower or any ERISA Affiliate receives notice of any unfavorable determination letter from the IRS regarding the qualification of a Plan under Section 401(a) of the Internal Revenue Code, copies of each such letter; (i) within fifteen (15) Business Days after the Borrower or any ERISA Affiliate receives notice from a Multiemployer Plan regarding the imposition of withdrawal liability, copies of each such notice; (j) within fifteen (15) Business Days after the Borrower or any ERISA Affiliate fails to make a required installment or any other required payment under Section 412 of the Internal Revenue Code on or before the due date for such installment or payment, a notification of such failure; and (k) within fifteen (15) Business Days after the Borrower or any ERISA Affiliate knows or has reason to know (i) a Multiemployer Plan has been terminated, (ii) the administrator or plan sponsor of a Multiemployer Plan intends to terminate a Multiemployer Plan, or (iii) the PBGC has instituted or will institute proceedings under Section 4042 of ERISA to terminate a Multiemployer Plan, notification of such termination, intention to terminate, or institution of proceedings. For purposes of this Section 8.6, the Borrower and any ERISA Affiliate shall be deemed to know all facts known by the "Administrator" of any Plan of which the Borrower or any ERISA Affiliate is the plan sponsor. 55 8.7. Environmental Notices. The Borrower shall notify the Co-Agents and the Lenders in writing, promptly upon any senior employee of the Borrower responsible for environmental matters at the applicable Property of the Borrower or any of its Subsidiaries learning thereof with respect to a Property, of any of the following (together with any material documents and correspondence received or sent in connection therewith): (a) notice or claim to the effect that the Borrower or any of its Subsidiaries is or may be liable to any Person as a result of the Release or threatened Release of any Contaminant into the environment, if such liability could result in a Material Adverse Effect; (b) notice that the Borrower or any of its Subsidiaries is subject to investigation by any Governmental Authority evaluating whether any Remedial Action is needed to respond to the Release or threatened Release of any Contaminant into the environment which could result in a Material Adverse Effect; (c) notice that any Property of the Borrower or any of its Subsidiaries is subject to an Environmental Lien if the claim to which such Environmental Lien relates could result in a Material Adverse Effect; (d) notice of a violation by the Borrower or any of its Subsidiaries of any Environmental, Health or Safety Requirement of Law which violation could result in a Material Adverse Effect; (e) any condition which might reasonably result in a violation by the Borrower or any Subsidiary of the Borrower of any Environmental, Health or Safety Requirement of Law, which violation could result in a Material Adverse Effect; (f) commencement or threat of any judicial or administrative proceeding alleging a violation by the Borrower or any of its Subsidiaries of any Environmental, Health or Safety Requirement of Law, which could result in a Material Adverse Effect; (g) new or proposed changes to any existing Environmental, Health or Safety Requirement of Law that could result in a Material Adverse Effect; or (h) any proposed acquisition of stock, assets, real estate, or leasing of Property, or any other action by the Borrower or any of its Subsidiaries that could subject the Borrower or any of its Subsidiaries to environmental, health or safety Liabilities and Costs which could result in a Material Adverse Effect. 8.8. Labor Matters. The Borrower shall notify the Co-Agents in writing, promptly upon the Borrower's learning thereof, of any labor dispute to which the Borrower or any of its Subsidiaries may become a party (including, without limitation, any strikes, lockouts or other disputes relating to any Property of such Persons and other facilities) which could result in a Material Adverse Effect. 8.9. Notices of Asset Sales and/or Acquisitions. The Borrower shall deliver to the Co-Agents and the Lenders written notice of each of the following upon the occurrence thereof: (a) a sale, transfer or other disposition of Real Property or any interests therein, in a 56 single transaction or series of related transactions, for consideration in excess of $100,000,000, (b) an acquisition of Real Property or any interest therein, in a single transaction or series of related transactions, for consideration in excess of $100,000,000 and (c) the grant of a Lien with respect to Real Property or any interest therein, in a single transaction or series of related transactions, in connection with Indebtedness aggregating an amount in excess of $200,000,000. 8.10. Other Reports. The Borrower shall deliver or cause to be delivered to the Co-Agents copies of all financial statements, reports, material notices and other materials, if any, sent or made available generally by GGP, Inc. or the Borrower to their respective Securities holders or filed with the Commission, all press releases made available generally by GGP, Inc., the Borrower or any of its Subsidiaries to the public concerning material developments in the business of GGP, Inc., the Borrower or any such Subsidiary and all notifications received by GGP, Inc., the Borrower or its Subsidiaries pursuant to the Securities Exchange Act and the rules promulgated thereunder. 8.11. Other Information. Promptly upon receiving a request therefor from either Co-Agent, the Borrower shall prepare and deliver to the Co- Agents such other information with respect to the Borrower and its Subsidiaries, on a Consolidated basis, as from time to time may be reasonably requested by such Co-Agent. ARTICLE IX AFFIRMATIVE COVENANTS The Borrower covenants and agrees that until payment in full of all of the Obligations (other than indemnities pursuant to Section 15.3 not yet due): 9.1. Existence, Etc. The Borrower shall, and shall cause each of its Subsidiaries to, at all times maintain its corporate existence or existence as a limited liability company, limited partnership, general partnership, trust or joint venture, as applicable, and preserve and keep, or cause to be preserved and kept, in full force and effect, its rights and franchises material to its businesses, except where the loss or termination of such rights and franchises is not likely to have a Material Adverse Effect. 9.2. Powers; Conduct of Business. The Borrower shall remain qualified, and shall cause each of its Subsidiaries to qualify and remain qualified, to do business and maintain its good standing in each jurisdiction in which the nature of its business and the ownership of its respective Properties requires it to be so qualified and in good standing. 9.3. Compliance with Laws, Etc. The Borrower shall, and shall cause each of its Subsidiaries to, (a) comply in all material respects with all Requirements of Law and all restrictive covenants affecting such Person or the business, Property, assets or operations of such Person, and (b) obtain and maintain as needed all Permits necessary for its operations (including, without limitation, the operation of the Real Properties) and maintain such Permits in good standing, except where noncompliance with either clause (a) or (b) above is not reasonably likely to have a Material Adverse Effect. 57 9.4. Payment of Taxes and Claims. (a) The Borrower shall pay, and cause each of its Subsidiaries to pay, (i) all taxes, assessments and other governmental charges imposed upon it or on any of its Property or assets or in respect of any of its franchises, licenses, receipts, sales, use, payroll, employment, business, income or Property before any penalty or interest accrues thereon, and (ii) all Claims (including, without limitation, claims for labor, services, materials and supplies) for sums which have become due and payable and which by law have or may become a Lien (other than a Lien permitted by Section 10.2 or a Customary Permitted Lien for property taxes and assessments not yet due) upon any of the Borrower's or any of the Borrower's Subsidiaries' Property or assets, prior to the time when any penalty or fine shall be incurred with respect thereto; provided, however, that no such taxes, assessments, fees and governmental charges referred to in clause (i) above or Claims referred to in clause (ii) above need be paid if being contested in good faith by appropriate proceedings diligently instituted and conducted and if such reserve or other appropriate provision, if any, as shall be required in conformity with GAAP shall have been made therefor. 9.5. Insurance. The Borrower shall maintain for itself and its Subsidiaries, or shall cause each of its Subsidiaries to maintain in full force and effect the insurance policies and programs listed on Schedule 7.1T or substantially similar policies and programs or other policies and programs as are reasonably acceptable to the Co-Agents. All such policies and programs shall be maintained with insurers reasonably acceptable to the Co-Agents. 9.6. Inspection of Property; Books and Records; Discussions. The Borrower shall permit, and cause each of its Subsidiaries to permit, any authorized representative(s) designated by either Co-Agent or any Lender to visit and inspect any of their respective Real Properties, to examine, audit, check and make copies of their respective financial and accounting records, books, journals, orders, receipts and any correspondence and other data relating to their respective businesses or the transactions contemplated hereby (including, without limitation, in connection with environmental compliance, hazard or liability), and to discuss their affairs, finances and accounts with their Authorized Financial Officers and independent certified public accountants, all with a representative of the Borrower present, upon reasonable notice and at such reasonable times during normal business hours, as often as may be reasonably requested. Each such visitation and inspection shall be at such visitor's expense; provided that at any time during the continuance of an Event of Default, each such visitation and inspection by the Administrative Agent shall be at the Borrower's expense. The Borrower shall keep and maintain, and cause its Subsidiaries to keep and maintain, in all material respects proper books of record and account in which entries in conformity with GAAP shall be made of all dealings and transactions in relation to their respective businesses and activities. 9.7. ERISA Compliance. The Borrower shall, and shall cause each of its ERISA Affiliates to, establish, maintain and operate all Plans to comply in all material respects with the provisions of ERISA, the Internal Revenue Code, all other applicable laws, and the regulations and interpretations having the force of law thereunder and the respective requirements of the governing documents for such Plans. Each Plan which is intended to qualify under Section 401(a) of the Internal Revenue Code has received a favorable determination letter from the Internal Revenue Service and nothing has occurred which would reasonably be expected to cause the loss of such qualification. 58 9.8. Maintenance of Property. The Borrower shall, and shall cause each of its Subsidiaries to, maintain in all material respects all of their respective owned and leased Property in good, safe and insurable condition and repair, and not permit, commit or suffer any waste or abandonment of any such Property and from time to time shall make or cause to be made all material repairs, renewal and replacements thereof, including, without limitation, any capital improvements which may be required to maintain the same in good condition and repair; provided, however, that such Property may be altered or renovated in the ordinary course of business of the Borrower or such applicable Subsidiary. Without any limitation on the foregoing, the Borrower shall maintain the Real Property in a manner such that each Real Property can be used in the manner and substantially for the purposes such Real Property is used on the Closing Date, including, without limitation, maintaining all utilities, access rights, zoning and necessary Permits for such Real Property. 9.9. Management of the Company. The Partnership shall at all times retain direct or indirect control of the Company. 9.10. Ownership of Property. The ownership of substantially all Property of the Consolidated Businesses shall be held by the Borrower and its Subsidiaries. 9.11. Committed Financing. Within 90 days after the Closing Date, the Borrower shall obtain from lenders or investors acceptable to the Co-Agents equity or unsecured debt financing in an aggregate amount, when added to the unsecured debt financing incurred on the Closing Date and under this Agreement, equal to $275,000,000 and the terms, conditions and pricing of such unsecured debt financing shall be reasonably acceptable to the Co-Agents, shall comply with the requirements of Section 10.12(h) hereof, and shall not otherwise be more favorable to the lender(s) thereof than the terms, conditions and pricing provided for herein. ARTICLE X NEGATIVE COVENANTS The Borrower covenants and agrees that it shall comply, or cause compliance, with the following covenants until payment in full of all of the Obligations (other than indemnities pursuant to Section 15.3 not yet due): 10.1. Sales of Assets. Neither the Borrower nor any of its Subsidiaries shall sell, assign, transfer, lease, convey or otherwise dispose of any Property, whether now owned or hereafter acquired, or any income or profits therefrom, or enter into any agreement to do so which would result in a Material Adverse Effect. 10.2. Liens. Neither the Borrower nor any of its Subsidiaries shall directly or indirectly create, incur, assume or permit to exist any Lien on or with respect to any Property, or (to the extent the same constitutes a pledge or other encumbrance of equity interests in the Borrower or the Consolidated Businesses) on or with respect to any such Securities held by the Borrower, except, subject to Section 10.12(i) hereof: (a) Liens with respect to Capital Leases of Equipment entered into in the ordinary course of business of the Borrower or any of its Subsidiaries pursuant to which the 59 aggregate Indebtedness under such Capital Leases does not exceed $1,000,000 for any Real Property; (b) Customary Permitted Liens; and (c) Liens to secure capital contributions arising in favor of the holders of equity interests in entities which are Minority Holdings of the Borrower pursuant to the terms of the applicable partnership, joint venture, operating, shareholders or similar agreement between such holders and the Borrower; provided, however, that none of the foregoing shall limit or prohibit the Borrower from (i) granting Liens on its respective Real Properties for the purposes of securing Secured Indebtedness otherwise permitted hereunder or (ii) incurring additional Unsecured Indebtedness otherwise permitted hereunder. 10.3. Conduct of Business. Neither the Borrower nor any of its Subsidiaries shall engage in any business, enterprise or activity other than (a) the businesses of acquiring, developing, redeveloping and managing predominately retail Real Properties and portfolios of like Real Properties and (b) any business or activities which are substantially similar, related or incidental thereto. 10.4. Transactions with Partners and Affiliates. Neither the Borrower nor any of its Subsidiaries shall directly or indirectly enter into or permit to exist any transaction (including, without limitation, the purchase, sale, lease or exchange of any Property or the rendering of any service) with any Affiliate of the Borrower which is not its Subsidiary, on terms that are determined by the Board of Directors of GGP, Inc. to be less favorable to the Borrower or any of its Subsidiaries, as applicable, than those that might be obtained in an arm's length transaction at the time from Persons who are not such an Affiliate. Nothing contained in this Section 10.4 shall prohibit (a) increases in compensation and benefits for officers and employees of the Borrower or any of its Subsidiaries which are customary in the industry or consistent with the past business practice of the Borrower or such Subsidiary; provided, however, that no Event of Default has occurred and is continuing; (b) payment of customary partners' indemnities; or (c) performance of any obligations arising under the Loan Documents. 10.5. Restriction on Fundamental Changes and Changes of Control. Neither the Borrower nor any of its Subsidiaries shall enter into any merger or consolidation, or liquidate, windup or dissolve (or suffer any liquidation or dissolution), or convey, lease, sell, transfer or otherwise dispose of, in one transaction or series of related transactions, all or substantially all of the Borrower's or any such Subsidiary's business or Property, whether now or hereafter acquired, except in connection with issuance, transfer, conversion or repurchase of limited partnership interests in the Partnership or membership interests in the Company (a) in connection with the acquisition of Real Property as consideration paid to the seller thereof or (b) to the extent required under the Borrower Operating Agreement. Notwithstanding the foregoing, the Borrower shall be permitted to merge with another Person so long as the Borrower (i) is the surviving Person following such merger or (ii) complies with Section 4.1(c)(i). No Change of Control shall occur. 60 10.6. Margin Regulations; Securities Laws. Neither the Borrower nor any of its Subsidiaries, shall use all or any portion of the proceeds of any credit extended under this Agreement to purchase or carry Margin Stock. 10.7. ERISA. The Borrower shall not and shall not permit any of its ERISA Affiliates to: (a) engage in any prohibited transaction described in Sections 406 of ERISA or 4975 of the Internal Revenue Code for which a statutory or class exemption is not available or a private exemption has not been previously obtained from the DOL; (b) permit to exist any accumulated funding deficiency (as defined in Sections 302 of ERISA and 412 of the Internal Revenue Code), with respect to any Benefit Plan, whether or not waived; (c) fail to pay timely required contributions or annual installments due with respect to any waived funding deficiency to any Benefit Plan; (d) terminate any Benefit Plan which would result in any liability of Borrower or any ERISA Affiliate under Title IV of ERISA; (e) fail to make any contribution or payment to any Multiemployer Plan which Borrower or any ERISA Affiliate may be required to make under any agreement relating to such Multiemployer Plan, or any law pertaining thereto; (f) fail to pay any required installment or any other payment required under Section 412 of the Internal Revenue Code on or before the due date for such installment or other payment; or (g) amend a Benefit Plan resulting in an increase in current liability for the plan year such that the Borrower or any ERISA Affiliate is required to provide security to such Plan under Section 401(a)(29) of the Internal Revenue Code. 10.8. Organizational Documents. Neither the Borrower nor any of its Subsidiaries shall amend, modify or otherwise change any of the terms or provisions in any of their respective Organizational Documents as in effect on the Closing Date, except amendments to effect (a) a change of name of the Borrower or any such Subsidiary (provided, however, that the Borrower shall have provided the Co-Agents with at least ten (10) Business Days' prior written notice of any such name change), (b) changes to the Borrower Partnership Agreement relating to the acquisition of Real Property or interests in an owner of Real Property with respect to which the consideration paid to the seller thereof includes limited partnership interests in the Partnership, or (c) changes that would not affect such Organizational Documents in any material manner not otherwise permitted under this Agreement or in any manner adverse to the Co-Agents or the Lenders. 10.9. Fiscal Year. Neither the Borrower nor any of its Consolidated Subsidiaries shall change its Fiscal Year for accounting or tax purposes from a period consisting of the 12-month period ending on December 31 of each calendar year. 61 10.10. [Intentionally Omitted]. 10.11. Investments. Neither the Borrower nor any of its Subsidiaries shall directly or indirectly make or own any Investment, except: (i) Investments in Cash and Cash Equivalents; (ii) Subject to the limitations set forth in this Section 10.11, Investments in the Borrower's Subsidiaries, the Borrower's Affiliates and the Management Company; (iii) Investments received in connection with the bankruptcy or reorganization of suppliers and lessees and in settlement of delinquent obligations of, and other disputes with, lessees and suppliers arising in the ordinary course of business; (iv) Investments in: (A) any individual Real Property (other than the Ala Moana Center and Property related thereto) which do not exceed seven percent (7%) of the Capitalization Value after giving effect to such Investments of the Borrower and its Subsidiaries; (B) any single Person owning Property or any portfolio of Properties (other than the Homart Portfolio and the Ivanhoe Portfolio of the Borrower) which do not exceed twenty percent (20%) of the Capitalization Value after giving effect to such Investments of the Borrower and its Subsidiaries, it being understood that no Investment in any individual Person will be permitted if the Borrower's allocable share of the Investment of such Person in any individual Property would exceed the limitation described in clause (A) above; (C) joint ventures and Subsidiaries that are not Consolidated Subsidiaries (including, without limitation, such Subsidiaries in the Homart Portfolio of the Borrower) which, in the aggregate, do not exceed fifty percent (50%) of the Capitalization Value after giving effect to such Investments of the Borrower and its Subsidiaries; (D) Real Estate Under Construction which, in the aggregate, does not exceed fifteen percent (15%) of the Capitalization Value after giving effect to such Investments of the Borrower and its Subsidiaries (provided, however, that, for purposes of this clause (D) only, the term Real Estate Under Construction shall not include any Construction Asset which is at least eighty percent (80%) leased, and provided further that, for purposes of this clause (D), any portion of a Construction Asset which is under an unconditional (except for customary closing conditions) binding contract of sale to an "anchor tenant" shall be deemed to be leased); and 62 (E) Inactive Assets which, in the aggregate, do not exceed eight percent (8%) of the Capitalization Value after giving effect to such Investments of the Borrower and its Subsidiaries; provided, however, that the Investments of the Borrower and its Subsidiaries described in clauses (D) and (E) above shall not together exceed fifteen percent (15%) of the Capitalization Value after giving effect to such Investments of the Borrower and its Subsidiaries; and (v) Investments held as of the Closing Date. 10.12. Other Financial Covenants. (a) Minimum Combined Equity Value. The Combined Equity Value shall at no time be less than the sum of (i) $2,000,000,000, plus (ii) an amount equal to seventy-five percent (75%) of the aggregate net proceeds received by the Borrower or GGP, Inc. in connection with any offering or issuance after the date of this Agreement of equity Securities (including, without limitation, common stock, preferred stock, partnership interests and membership interests) representing interests in the Borrower, or GGP, Inc. or any of their respective Subsidiaries. (b) Consolidated Interest Coverage Ratio. As of the last day of each fiscal quarter for the immediately preceding four fiscal quarters, the ratio of (i) Combined EBITDA to (ii) Combined Interest Expense shall not be less than 1.8 to 1.0. (c) Minimum Debt Yield. As of the last day of each fiscal quarter, the ratio (expressed as a percentage) of (i) the sum of (A) Combined EBITDA, plus (B) interest paid from reserves established under construction loans to (ii) Total Adjusted Outstanding Indebtedness shall not be less than 13.25%. (d) Dividends and Redemptions. (i) The Borrower will not, as determined on an aggregate annual basis, pay any dividends (excluding special capital gain distributions, if any) in excess of 65% of FFO for such year. (ii) Neither the Borrower nor GGP, Inc. will, as determined on a combined, aggregate annual basis for both the Borrower and GGP, Inc., voluntarily redeem, repurchase or otherwise acquire for value more than $50,000,000 of the common stock, preferred stock, partnership interests and/or membership interests issued by GGP, Inc. and/or the Borrower, respectively, excluding any such redemption, repurchase or acquisition required pursuant to any Contractual Obligation to honor any conversion, exchange or put right heretofore or hereafter granted to any Person as consideration for capital contributions to GGP, Inc. or the Borrower, as the case may be, or in furtherance of any other bona fide business purpose of GGP, Inc. or the Borrower, as the case may be; provided, however, that no such redemption, repurchase or acquisition shall have, or be reasonably likely to have, a Material Adverse Effect. 63 (e) Minimum Fixed Charge Coverage Ratio. As of the first day of each calendar quarter for the immediately preceding calendar quarter, the ratio of (i) Combined EBITDA to (ii) Fixed Charges shall not be less than 1.5 to 1.0. (f) Minimum Net Equity and Loan-to-Value For Certain Wholly-Owned Properties. In the event that, and for so long as, the aggregate Investments of the Borrower and its Subsidiaries in joint ventures and Subsidiaries that are not Consolidated Subsidiaries (including, without limitation, such Subsidiaries in the Homart Portfolio of the Borrower), exceed thirty-five percent (35%) of the Capitalization Value: (i) the Capitalization Value attributable to Properties that are wholly owned, directly or indirectly, by the Borrower, less Indebtedness secured by Liens thereon or otherwise attributable thereto, shall at no time be less than $1,750,000,000; and (ii) the Loan-to-Value Ratio with respect to such Properties in the aggregate shall at no time exceed sixty-five percent (65%). (g) Leverage Ratio. (i) Neither the Borrower nor any of its Subsidiaries shall directly or indirectly create, incur, assume or otherwise become or remain directly or indirectly liable with respect to: (w) any Indebtedness, except Indebtedness which, when aggregated with Indebtedness of the Borrower and, without duplication, its Subsidiaries and Minority Holdings Indebtedness allocable pro rata in accordance with GAAP to the Borrower as of the time of determination, would not cause Total Adjusted Outstanding Indebtedness to exceed sixty-five percent (65%) of Capitalization Value as of the date of incurrence; (x) any Recourse Indebtedness of the Borrower, except Recourse Indebtedness which, when aggregated with Recourse Indebtedness of the Borrower and without, duplication, its respective Subsidiaries and Recourse Minority Holdings Indebtedness allocable in accordance with GAAP to the Borrower as of the time of determination, would not cause the portion of Total Adjusted Outstanding Indebtedness consisting of Recourse Indebtedness to exceed twenty percent (20%) of Capitalization Value as of the date of incurrence; (y) secured Recourse Indebtedness (other than secured Indebtedness relating to construction loans) in an aggregate amount outstanding not to exceed $175,000,000; or (z) any Unsecured Indebtedness, except Unsecured Indebtedness which, when aggregated with Total Adjusted Outstanding Unsecured Indebtedness, would not cause Total Adjusted Outstanding Unsecured Indebtedness to exceed the lesser of twenty percent (20%) Combined Equity Value as of the date of incurrence or the amount that is then applicable under subsection (ii) or subsection (iii) below. (ii) From and after the date hereof, through and including July 31, 2002, Total Adjusted Outstanding Unsecured Indebtedness shall not exceed $650,000,000. (iii) From and after August 1, 2002, through and including the Maturity Date, Total Adjusted Outstanding Unsecured Indebtedness shall not exceed $450,000,000. 64 (h) Most Favored Loan. (i) The Borrower will not enter into any credit agreement or execute any note, deed of trust, mortgage, security agreement, pledge or any other loan agreement, document or instrument governing, evidencing or securing any Indebtedness of the Borrower (or any amendment or modification of Indebtedness of the Borrower) which is either (A) Unsecured Indebtedness or (B) secured and Recourse Indebtedness, the terms of which require compliance by the Borrower with covenants that, taken as a whole, are more restrictive than the covenants of the Borrower herein contained, including, without limitation, those covenants set forth in this Section 10.12. (ii) The Borrower will not grant any Liens on any Property of the Borrower or its Subsidiaries to secure Unsecured Indebtedness in respect of the Revolving Credit Agreement, dated as of the date hereof, among the Company, the Partnership, Bank of America, N.A., as administrative agent, and others, unless substantially simultaneously therewith the Borrower or its Subsidiaries, as applicable, shall grant similar Liens on a pari passu basis to secure the Obligations to the extent and in a manner reasonably satisfactory to the Co-Agents. (i) Certain Liens. None of the Borrower, GGP, Inc. or any of the Affiliates which are controlled by them, respectively, will encumber with any Lien any stock, partnership interest, joint venture interest, membership interest, beneficial interest or other equity interest in any corporation, partnership, joint venture, limited liability company, trust or other entity that (i) owns any of the respective Property, or (ii) is a direct or indirect shareholder, partner, joint venturer, member, beneficiary or other type of equity holder in any entity described in clause (i) above; provided, however, that the foregoing prohibition shall not apply with respect to any of the encumbrances existing on the date hereof set forth in Schedule 10.12 hereto; and provided further; that the prohibition set forth in this subsection (i) shall not apply as to any such corporation, partnership, joint venture, limited liability company, trust or other entity which owns Property with respect to which the Loan-to-Value Ratio as to all Secured Indebtedness for borrowed money related to such Property, in the aggregate, before giving effect to such encumbrance, is not greater than fifty percent (50%), and, after giving effect to such encumbrance, is not greater than sixty-five percent (65%); and provided further that the prohibition set forth in this subsection (i) shall not apply as to any such encumbrance granted to secure Indebtedness related to any Property or asset of such corporation, partnership, joint venture, limited liability company, trust or other entity, if such encumbrance secures a construction loan and the Loan-to-Value Ratio with respect to all Indebtedness relating to the construction in question does not exceed seventy-five percent (75%), or would not exceed such Loan-to-Value Ratio, but for the applicability of unusually onerous stamp, transfer or recording taxes and fees in connection with such encumbrance; and provided further that the prohibition set forth in this subsection (i) shall not apply as to any such encumbrance of equity interests in Minority Holdings in favor of holders(s) of the remaining equity interests in such Minority Holdings to secure obligations under the applicable Organizational Documents of such Minority Holdings. 65 ARTICLE XI EVENTS OF DEFAULT; RIGHTS AND REMEDIES 11.1. Events of Default. Each of the following occurrences shall constitute an Event of Default under this Agreement: (a) Failure to Make Payments When Due. The Borrower shall fail to pay when due any principal payment of or interest payment on the Obligations. (b) Breach of Certain Covenants. (i) The Borrower shall fail duly and punctually to perform or observe any agreement, covenant or obligation binding on the Borrower under Sections 8.3, 9.1, 9.2, 9.3, 9.9, 9.10 or Article X. (ii) The Borrower shall fail duly and punctually to perform or observe any agreement, covenant or obligation binding on the Borrower under Sections 8.2, 9.4, 9.5 or 9.6 and such failure shall continue for fifteen (15) days after receipt of written notice from the Administrative Agent thereof. (iii) GGP, Inc. shall fail duly and punctually to perform or observe any covenant in the Guaranty (provided that if such covenant requires performance by the Guarantor which is substantially similar to performance of the Borrower required by a covenant hereunder, the Guarantor shall be permitted the same right to notice of failure of performance and period of opportunity for cure, if any, provided to the Borrower hereunder in respect of such covenant). (c) Breach of Representation or Warranty. Any representation or warranty made by the Borrower to the Co-Agents or any Lender herein or by GGP, Inc., the Borrower or any of its Subsidiaries in any of the other Loan Documents or in any statement or certificate at any time given by any such Person pursuant to any of the Loan Documents shall be false or misleading in any material respect on the date as of which made. (d) Other Defaults. Except as set forth in the next sentence, the Borrower shall default in the performance of or compliance with any term contained in this Agreement (other than as identified in paragraphs (a), (b) or (c) of this Section 11.1), or any default or event of default (other than as identified in paragraphs (a), (b) or (c) of this Section 11.1) shall occur under any of the other Loan Documents, and such default or event of default shall continue for thirty (30) days after receipt of written notice from the Administrative Agent thereof. Notwithstanding the foregoing sentence, such failure or noncompliance shall not constitute an Event of Default so long as the Borrower commences the cure within such thirty (30) day period after the receipt of written notice, thereafter diligently pursues the same until completion and completes the cure of such failure or noncompliance within ninety (90) days after the receipt of such notice. (e) Cross-Defaults; Acceleration of Other Indebtedness. Any breach, default or event of default shall occur, or any other condition shall exist, subject to the receipt of any 66 applicable notice and the expiration of any applicable cure period or grace period, under any instrument, agreement or indenture pertaining to any Recourse Indebtedness (other than the Obligations) of the Borrower or its Subsidiaries aggregating $15,000,000 or more; or any such Recourse Indebtedness aggregating $15,000,000 or more shall be otherwise declared to be due and payable (by acceleration or otherwise) or required to be prepaid, redeemed or otherwise repurchased by the Borrower or any of its Subsidiaries (other than by a regularly scheduled required prepayment) prior to the stated maturity thereof. (f) Involuntary Bankruptcy: Appointment of Receiver, Etc. (i) An involuntary case shall be commenced against GGP, Inc., the Borrower, or any of its Subsidiaries to which more than $50,000,000 of the Capitalization Value is attributable, and the petition shall not be dismissed, stayed or discharged within sixty (60) days after commencement of the case; or a court having jurisdiction in the premises shall enter a decree or order for relief in respect of GGP, Inc., the Borrower or any of their respective Subsidiaries in an involuntary case, under any applicable bankruptcy, insolvency or other similar law now or hereinafter in effect; or any other similar relief shall be granted under any applicable federal, state, local or foreign law; or the board of directors of GGP, Inc. or the partners or members, as the case may be, of the Borrower or the board of directors, partners or members of any of the Borrower's Subsidiaries to which more than $50,000,000 of the Capitalization Value is attributable (or any committee thereof) adopts any resolution or otherwise authorizes any action to approve any of the foregoing. (ii) A decree or order of a court having jurisdiction in the premises for the appointment of a receiver, liquidator, sequestrator, trustee, custodian or other officer having similar powers over GGP, Inc., the Borrower or any of their respective Subsidiaries to which more than $50,000,000 of the Capitalization Value is attributable, or over all or a substantial part of the Property of any of GGP, Inc., the Borrower or any of such Subsidiaries shall be entered; or an interim receiver, trustee or other custodian of any of GGP, Inc., the Borrower or any of such Subsidiaries or of all or a substantial part of the Property of any of GGP, Inc., the Borrower or any of such Subsidiaries shall be appointed or a warrant of attachment, execution or similar process against any substantial part of the Property of any of GGP, Inc., the Borrower or any of such Subsidiaries shall be issued and any such event shall not be stayed, dismissed, bonded or discharged within sixty (60) days after entry, appointment or issuance; or the respective board of directors of any of GGP, Inc., the Borrower or partners of the Borrower or the board of directors or partners of any of Borrower's Subsidiaries to which more than $50,000,000 of the Capitalization Value is attributable (or any committee thereof) adopts any resolution or otherwise authorizes any action to approve any of the foregoing. (g) Voluntary Bankruptcy; Appointment of Receiver, Etc. Any of GGP, Inc., the Borrower, or any of their respective Subsidiaries to which more than $50,000,000 of the Capitalization Value is attributable, shall commence a voluntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or shall consent to the entry of an order for relief in an involuntary case, or to the conversion of an involuntary case to a voluntary case, under any such law, or shall consent to the appointment of or taking possession 67 by a receiver, trustee or other custodian for all or a substantial part of its Property; or any of GGP, Inc., the Borrower or any of such Subsidiaries to which more than $50,000,000 of the Capitalization Value is attributable shall make any assignment for the benefit of creditors or shall be unable or fail, or admit in writing its inability, generally to pay its debts as such debts become due. (h) Judgments and Unpermitted Liens. (i) Any money judgment (other than a money judgment covered by insurance as to which the insurance company has acknowledged coverage), writ or warrant of attachment, or similar process against GGP, Inc., the Borrower or any of its Subsidiaries or any of its respective assets involving in any event an amount in excess of $15,000,000 (other than with respect to Claims arising out of nonrecourse Indebtedness) is entered and shall remain undischarged, unvacated, unbonded or unstayed for a period of sixty (60) days or in any event later than five (5) days prior to the date of any proposed sale thereunder. (ii) A federal, state, local or foreign tax Lien (other than a Lien permitted by Section 10.2 of this Agreement or a Lien relating to taxes being contested pursuant to Section 9.4 of this Agreement) is filed against GGP, Inc., the Borrower which is not discharged of record, bonded over or otherwise secured to the satisfaction of the Co-Agents within thirty (30) days after the filing thereof or the date upon which the Co- Agents receive actual knowledge of the filing thereof for an amount which, either separately or when aggregated with the amount of any judgments described in clause (i) above and/or the amount of the Environmental Lien Claims described in clause (iii) below, equals or exceeds $15,000,000. (iii) An Environmental Lien is filed against any Real Property with respect to Claims in an amount which, either separately or when aggregated with the amount of any judgments described in clause (i) above and/or the amount of the tax Liens described in clause (ii) above, equals or exceeds $15,000,000. (i) Dissolution. Any order, judgment or decree shall be entered against GGP, Inc. or the Borrower decreeing its involuntary dissolution or split up; or GGP, Inc. or the Borrower shall otherwise dissolve or cease to exist except as specifically permitted by this Agreement. (j) Loan Documents. At any time, for any reason, any Loan Document ceases to be in full force and effect or any of the Borrower or GGP, Inc. seeks to repudiate its obligations thereunder. (k) ERISA Termination Event. Any ERISA Termination Event occurs which the Co-Agents reasonably believe could subject either the Borrower or any ERISA Affiliate to liability in excess of $1,000,000. (l) Waiver Application. The plan administrator of any Benefit Plan applies under Section 412(d) of the Internal Revenue Code for a waiver of the minimum funding standards of Section 412(a) of the Internal Revenue Code and the Co-Agents reasonably believe 68 that the substantial business hardship upon which the application for the waiver is based could subject either the Borrower or any ERISA Affiliate to liability in excess of $1,000,000. (m) Certain Defaults Pertaining to GGP, Inc. GGP, Inc. shall fail to (i) maintain its status as a REIT under the Internal Revenue Code, (ii) retain direct or indirect management and control of the Borrower, (iii) continue as the general partner of the Partnership, (iv) comply in all material respects with all Requirements of Law applicable to it and its businesses and Properties, in each case where the failure to so comply individually or in the aggregate will have or is reasonably likely to have a Material Adverse Effect, (v) remain listed on the New York Stock Exchange or other national stock exchange, or (vi) file all tax returns and reports required to be filed by it with any Governmental Authority as and when required to be filed or to pay any taxes, assessments, fees or other governmental charges upon it or its Property, assets, receipts, sales, use, payroll, employment, licenses, income, or franchises which are shown in such returns, reports or similar statements to be due and payable as and when due and payable, except for taxes, assessments, fees and other governmental charges (A) that are being contested by GGP, Inc. in good faith by an appropriate proceeding diligently pursued, (B) for which adequate reserves have been made on its books and records, and (C) the amounts the nonpayment of which would not, individually or in the aggregate, result in a Material Adverse Effect. (n) Merger or Liquidation of GGP, Inc. or the Borrower. GGP, Inc. or the Borrower shall merge or liquidate with or into any other Person and, as a result thereof and after giving effect thereto, (i) GGP, Inc. or the Borrower, as applicable is not the surviving Person or (ii) such merger or liquidation would effect an acquisition of or Investment in any Person not otherwise permitted under the terms of this Agreement. An Event of Default shall be deemed "continuing" until cured or waived in writing in accordance with Section 15.7. 11.2. Rights and Remedies. (a) Acceleration and Termination. Upon the occurrence of any Event of Default described in Sections 11.1(f) or 11.1(g), the unpaid principal amount of, and any and all accrued interest on, the Obligations and all accrued fees shall automatically become immediately due and payable, without presentment, demand, or protest or other requirements of any kind (including, without limitation, valuation and appraisement, diligence, presentment, notice of intent to demand or accelerate and of acceleration), all of which are hereby expressly waived by the Borrower; and upon the occurrence and during the continuance of any other Event of Default, the Administrative Agent shall at the request, or may with the consent, of the Requisite Lenders, by written notice to the Borrower, declare the unpaid principal amount of and any and all accrued and unpaid interest on the Obligations to be, and the same shall thereupon be, immediately due and payable, without any other presentment, demand, or protest or other requirements of any kind (including, without limitation, valuation and appraisement, diligence, presentment, notice of intent to demand or accelerate and of acceleration), all of which are hereby expressly waived by the Borrower. 69 (b) Enforcement. The Borrower acknowledges that in the event the Borrower fails to perform, observe or discharge any of its obligations or liabilities under this Agreement or any other Loan Document, any remedy of law may prove to be inadequate relief to the Co-Agents and the other Lenders; therefore, the Borrower agrees that the Co-Agents and the other Lenders shall be entitled to temporary and permanent injunctive relief in any such case without the necessity of proving actual damages. ARTICLE XII THE CO-AGENTS 12.1. Appointment. Bankers Trust is hereby irrevocably appointed Administrative Agent hereunder and under each other Loan Document and Lehman is hereby irrevocably appointed Syndication Agent hereunder and under each other Loans Document, and each of the Lenders irrevocably authorizes the Co-Agents to act as co-agents of such Lender. The Co-Agents agree to act as such upon the express condition contained in this Article XII. The Co-Agents shall not have any duties or responsibilities to the Lenders except those expressly set forth herein and shall not have a fiduciary relationship in respect of any Lender by reason of this Agreement. The Co-Agents, with the consent of the Borrower, may appoint any Lender as Documentation Agent under this Agreement. Any Documentation Agent appointed pursuant to the preceding sentence shall not have a fiduciary relationship in respect of any Lender by reason of this Agreement, and has no duties or responsibilities to the Lenders in that capacity, in connection with the administration of the Loan Documents or otherwise. 12.2. Powers. Each Co-Agent shall have and may exercise such powers under the Loan Documents as are specifically delegated to such Co-Agent by the terms of each thereof, together with such powers as are reasonably incidental thereto (but subject to Section 15.7 below). No Co-Agent shall have implied duties, obligations or liabilities to the Lenders, or any obligation to the Lenders to take any action thereunder except any action specifically provided by the Loan Documents to be taken by such Co-Agent. Only the Co-Agents may perform the duties reserved to them, respectively, under the Loan Documents and no Lender shall act or purport to act on behalf of the other Lenders or the Co- Agents on any such matters. Without limiting the generality of the foregoing: (a) The Administrative Agent shall have the exclusive right to collect from Borrower and any Guarantor, or third parties, on account of the Obligations, including, principal, interest, fees, protective advances and prepayment premiums (if any), whether such sums are received directly from Borrower, any guarantor, or any other Persons, or are obtained by right of offset by the Administrative Agent of any kind, or by enforcement of the Loan Documents. The Administrative Agent will receive and hold all collections with respect to the Loan for the benefit of the Lenders in accordance with their respective Pro Rata Shares or as otherwise provided herein. (b) If any Lender shall receive any payments or property in connection with the Obligations (whether or not voluntary), from any Person other than the Administrative Agent, such Lender shall transfer to the Administrative Agent all such payments or property within one (1) Business Day of receipt. 70 (c) No Lender shall independently initiate any judicial action or other proceeding against Borrower or any guarantor under the Guaranty or any other guaranty with respect to the Obligations. 12.3. General Immunity. None of the Co-Agents or any of their respective directors, officers, agents or employees shall be liable to the Borrower or the Lenders for any action taken or omitted to be taken by it or them hereunder or under any other Loan Document or in connection herewith or therewith, except for its or their own gross negligence or willful misconduct. 12.4. No Responsibility for Loans, Recitals, etc. None of the Co-Agents or any of their respective directors, officers, agents or employees shall be responsible for or have any duty to ascertain, inquire into, or verify (i) any statement, warranty or representation made in connection with any Loan Document or any Borrowing hereunder; (ii) the performance or observance of any of the covenants or agreements of any obligor under any Loan Document; (iii) the satisfaction of any condition specified in Article VI, except receipt of items required to be delivered to the Co-Agents or either of them, respectively; or (iv) the validity, effectiveness or genuineness of any Loan Document or any other instrument or writing furnished in connection therewith. 12.5. Action on Instructions of Lenders. The Co-Agents shall in all cases be fully protected by the Lenders, as against any claim or other action of any kind or nature whatsoever by any Lender, in acting, or in refraining from acting, hereunder and under any other Loan Document in accordance with written instructions signed by the Requisite Lenders (or, in the case of any waiver or amendment listed in Section 15.7(b) hereof, all of the Lenders) and such instructions and any action taken or failure to act pursuant thereto shall be binding on all of the Lenders and on all Holders. As between the Co-Agents and the Lenders, the Co-Agents shall be fully justified in failing or refusing to take any action hereunder and under any other Loan Document unless it shall first receive such advice or concurrence, if it so requests, of the Requisite Lenders and shall first be indemnified to its satisfaction by the Lenders in accordance with their respective Pro Rata Shares against any and all liability, cost and expense that it may incur by reason of taking or continuing to take any such action. 12.6. Employment of Agents and Counsel. Each Co-Agent may execute any of its duties as administrative agent or syndication agent, as applicable, hereunder and under any other Loan Document by or through employees, agents and attorneys-in-fact and shall not be answerable to the Lenders, except as to money or securities received by them or their respective authorized agents, for the default or misconduct of any such agents or attorneys-in-fact selected by them with reasonable care. As between the Co-Agents and the Lenders, each Co-Agent shall be entitled to engage and rely upon advice of legal counsel (including the Borrower's counsel), independent accountants and other professionals and experts selected by such Co-Agent concerning all matters pertaining to its agency hereby created and its duties hereunder and under any other Loan Document. 12.7. Reliance on Documents. The Co-Agents shall be entitled to rely upon any Note or other Loan Document, writing, notice, consent, certificate, facsimile, affidavit, letter, telegram, statement, paper, document or other communication believed by it to be genuine and 71 correct and to have been signed, sent or otherwise communicated by the proper person or persons. 12.8. Co-Agents' Reimbursement and Indemnification. The Lenders, ratably in accordance with their respective Pro Rata Shares, agree to reimburse and indemnify upon demand each of the Co-Agents (i) for any amounts not reimbursed by the Borrower for which such Co-Agent is entitled to reimbursement by the Borrower under the Loan Documents, (ii) for any other expenses (including reasonable attorneys' fees) incurred by such Co-Agent on behalf of the Lenders, in connection with the preparation, execution, delivery, administration, modification and enforcement of the Loan Documents, if not paid by Borrower, and (iii) for any liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind and nature whatsoever which may be imposed on, incurred by or asserted against such Co- Agent in any way relating to or arising out of the Loan Documents or any other document delivered in connection therewith or the transactions contemplated thereby, or the enforcement of any of the terms thereof or of any such other documents, provided that no Lender shall be liable for any of the foregoing to the extent they arise from the gross negligence or willful misconduct of such Co-Agent. Each Lender shall indemnify each of the Co-Agents and each of the other Lenders with respect to claims, liabilities, damages, costs, losses and expenses (including, without limitation, attorneys' fees) arising from or relating to the failure of such indemnifying Lender to satisfy its obligations under this Agreement and the other Loan Documents. No Co-Agent shall have any liability or obligation hereunder with respect to any negligence or misconduct of any other Co-Agent. 12.9. Rights as a Lender. With respect to the Loans made by it, the Note issued to it and otherwise, each of the Co-Agents shall have the same rights and powers hereunder and under any other Loan Document as any Lender and may exercise the same as though it were not one of the Co-Agents, and the term "Lender" or "Lenders" shall, unless the context otherwise indicates, include each of the Co-Agents in its capacity as a Lender. Each of the Co-Agents, in its capacity as a Lender, may accept deposits from, lend money to, and generally engage in any kind of trust, debt, equity or other transaction, in addition to those contemplated by this Agreement or any other Loan Document, with the Borrower in which the Borrower is not restricted hereby from engaging with any other Person. The Lenders acknowledge that each of the Co-Agents and their respective Affiliates now or in the future may have banking or other financial relationships, including being an agent on other loans, with Borrower and its Affiliates, as though it were not one of the Co-Agents hereunder and without notice to or consent of the Lenders. Each Lender hereby expressly waives any objection to such actual or potential conflict of interest. The Lenders acknowledge that in the course of such activities, any of the Co-Agents or their respective Affiliates may receive information regarding the Borrower or its Affiliates and acknowledge that none of the Co-Agents shall be under any obligation to provide such information to them, whether or not confidential. 12.10. Lender Credit Decision. Each Lender acknowledges that none of the Co-Agents or any of their respective agents has made any representation or warranty to such Lender and that no action or statement hereafter made or taken by either Co-Agent or any of their respective agents shall be deemed to be representation or warranty by such Co-Agent to such Lenders. Each Lender further acknowledges that it has, independently and without reliance upon the Co-Agents or any Lender and based on the financial statements prepared by the 72 Borrower and such other documents and information as such Lender has deemed appropriate, made its own credit analysis and decision to enter into this Agreement and the other Loan Documents. Each Lender also acknowledges that it will, independently and without reliance upon the Co-Agents or any Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis and decisions in taking or not taking action under this Agreement and the other Loan Documents. 12.11. Successor Co-Agents. Each Lender agrees that Bankers Trust shall serve as the Administrative Agent and Lehman as Syndication Agent at all times until all of the Obligations are paid in full, except that Bankers Trust or Lehman, as applicable, may resign from its agency at any time, in its sole discretion, upon thirty (30) days' prior written notice to the Lenders and the Borrower. If either Co-Agent is permitted to (in accordance with the terms of this Agreement) and does participate or assign its total interests in its Loans, other than to a successor entity to such Co-Agent, then such Co-Agent agrees to resign upon the request of any Lender or the Borrower. Upon any such resignation, the other Lenders shall have the right to appoint, on behalf of the Borrower and the Lenders, a successor Co-Agent, which successor Co-Agent, other than a successor entity to such Co-Agent, shall, so long as no Event of Default exists hereunder, be subject to the approval of Borrower (such approval not to be unreasonably withheld or delayed). If no successor Co-Agent shall have been so appointed by the other Lenders (and, if applicable, approved by Borrower) and shall have accepted such appointment within thirty (30) days after the retiring Co-Agent's giving notice of resignation, then the retiring Co-Agent may appoint, on behalf of the Borrower and the Lenders, a successor Co-Agent, which successor Co-Agent, other than a successor entity to the Co-Agent, shall, so long as no Event of Default exists hereunder, be subject to the approval of the Borrower (such approval not to be unreasonably withheld or delayed). Any successor Administrative Agent shall be a commercial bank having capital and retained earnings of at least $1,000,000,000. Upon the acceptance of any appointment as Co-Agent hereunder by a successor Co-Agent, such successor Co-Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Co-Agent, including the right to receive any fees for performing such duties which accrue thereafter, and the retiring Co-Agent shall be discharged from its duties and obligations subsequently arising hereunder and under the other Loan Documents. After any retiring Co-Agent's resignation hereunder as Co-Agent, the provisions of this Article XII shall continue in effect for its benefit and that of the other Lenders in respect of any actions taken or omitted to be taken by it while it was acting as the Co-Agent hereunder and under the other Loan Documents. 12.12. Notice of Defaults. If a Lender becomes aware of a Potential Event of Default or Event of Default, such Lender shall notify the Administrative Agent of such fact. Upon receipt of such notice that a Potential Event of Default or Event of Default has occurred, the Administrative Agent shall notify each of the Lenders of such fact. Except for defaults in the payment of principal, interest and fees payable to the Administrative Agent for the account of the Lenders and such other Obligations for which the Administrative Agent is expressly responsible for determining the Borrower's compliance, the Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Potential Event of Default or Event of Default, unless the Administrative Agent shall have received written notice from a Lender or the Borrower referring to the Loan, describing such Potential Event of Default or Event of Default and stating that such notice is a "notice of default". The Administrative Agent will notify the Lenders of its receipt of any such notice. The Administrative Agent shall take action with 73 respect to such Potential Event of Default or Event of Default in accordance with the provisions of this Agreement and the Loan Documents. 12.13. Requests for Approval. If the Administrative Agent requests in writing the consent or approval of a Lender, whether or not such consent or approval is required hereunder (and no such requirement shall be inferred from any such request), such Lender shall respond and either approve or disapprove definitively in writing to the Administrative Agent within ten (10) Business Days (or sooner if such notice specifies a shorter period based on the Administrative Agent's good faith determination that circumstances warrant an earlier response) after such written request from the Administrative Agent. 12.14. Copies of Documents. The Administrative Agent shall promptly deliver to each of the Lenders copies of all notices of default and other formal notices sent to or received by the Administrative Agent pursuant to Section 15.1 of this Agreement. 12.15. Withholding Tax. All taxes due and payable on any payments to be made by the Administrative Agent to a Lender under this Agreement shall be such Lender's sole responsibility, except to the extent such taxes are actually reimbursed by the Borrower under the Loan Documents. All payments to be made by the Administrative Agent to each Lender under this Agreement shall be made after deduction for any taxes, charges, levies or withholdings which are imposed by the country of organization of the Borrower, the United States of America or any other applicable taxing authority. Each Lender agrees to provide to the Administrative Agent completed and signed copies of any forms that may be required by the IRS (and any applicable state authority) in order to certify such Lender's exemption from or reduction of United States (or applicable state) withholding taxes with respect to payments to be made to such Lender under this Agreement or the Loan Documents. Each Lender agrees to promptly notify the Administrative Agent of any change which would modify or render invalid any claimed exemption or reduction. If any governmental authority of the United States or other jurisdiction asserts a claim that the Administrative Agent did not properly withhold tax from amounts paid to or for the account of any Lender, such Lender shall indemnify the Administrative Agent fully for all amounts paid by the Administrative Agent as tax or otherwise, including penalties and interest, and including any taxes imposed by any jurisdiction on the amount payable to the Administrative Agent under this section, together with all costs and expenses (including legal expenses). The obligation of the Lenders under this subsection shall survive the payment of all Obligations and the resignation or replacement of the Administrative Agent. 12.16. Borrower's Default; Enforcement. Upon the occurrence of an Event of Default under any Loan Document, the Requisite Lenders shall have the right, upon written notice to the Administrative Agent, to require that the Administrative Agent exercise the rights of the Lenders as directed by the Requisite Lenders; provided, however, that the Lenders shall indemnify, exonerate and hold the Administrative Agent harmless from and against any and all claims, losses, liabilities, damages and costs (including reasonable legal fees) incurred by the Administrative Agent as a result of any such exercise of rights at the direction of the Lenders and not resulting from the gross negligence or willful misconduct of the Administrative Agent. 12.17. Relationship of Parties. This Agreement is not intended to establish a partnership or joint venture between the Co-Agents and the Lenders. The provisions of the Loan 74 Documents regarding the relationships among the Co-Agents and the Lenders and this Article XII are intended solely to facilitate co-lending relationships among the Lenders under this Agreement. No security or investment contract under any federal or state law is intended to be created among the Lenders or between the Co-Agents and the Lenders. The execution of this Agreement, the performance of the terms thereof, and the Lenders' purchase of and ownership interests under this Agreement and the Loan Documents shall not constitute any Lender as owner, purchaser or seller of any security (as that term is defined in the Securities Act of 1933 or the Securities Exchange Act of 1934) issued, owned, purchased or sold by Bankers Trust or any of their Subsidiaries or Affiliates, either as principal or as agent for the Borrower. Each Lender is purchasing and acquiring legal and equitable ownership of its Pro Rata Share and is not making a loan to Bankers Trust or Lehman, and no debtor-creditor relationship exists between them as a result of this Agreement. 12.18. Counsel. The Lenders acknowledge that the Administrative Agent's counsel has represented and shall represent only the Administrative Agent in its capacity as such, in connection with the Loan Documents and this Agreement. Each other Lender shall retain independent legal counsel regarding all such matters, documents and agreements. After an Event of Default, the Lenders shall enter into a joint privilege agreement regarding the exchange of information that is or may be subject to attorney-client privilege or related privileges. The Administrative Agent's counsel shall prepare such joint privilege agreement, subject to the approval of the Requisite Lenders which approval shall not be unreasonably withheld by any Lender. ARTICLE XIII YIELD PROTECTION 13.1. Taxes. Payment of Taxes. Any and all payments by the Borrower hereunder or under any Note or other document evidencing any Obligations shall be made, in accordance with Section 4.2, free and clear of and without reduction for any and all present or future taxes, levies, imposts, deductions, charges, withholdings, and all stamp or documentary taxes, excise taxes, ad valorem taxes and other taxes imposed on the value of the Property, charges or levies which arise from the execution, delivery or registration, or from payment or performance under, or otherwise with respect to, any of the Loan Documents or the Loan Commitments and all other liabilities with respect thereto excluding, in the case of each Lender, taxes imposed on or measured by net income or overall gross receipts and capital and franchise taxes (imposed in lieu of taxes imposed on or measured by net income or overall gross receipts and capital) imposed on it by (i) the United States, (ii) the Governmental Authority of the jurisdiction in which such Lender's Applicable Lending Office is located or any political subdivision thereof or (iii) the Governmental Authority of the jurisdiction in which such Lender is organized, managed and controlled or any political subdivision thereof (all such nonexcluded taxes, levies, imposts, deductions, charges and withholdings being hereinafter referred to as "Taxes"). If the Borrower shall be required by law to withhold or deduct any Taxes from or in respect of any sum payable hereunder or under any such Note or document to any Lender, (x) the sum payable to such Lender shall be increased as may be necessary so that after making all required withholding or deductions (including withholding or deductions applicable to additional sums payable under this Section 13.1) such Lender receives an amount equal to the sum it would 75 have received had no such withholding or deductions been made, (y) the Borrower shall make such withholding or deductions, and (z) the Borrower shall pay the full amount withheld or deducted to the relevant taxation authority or other authority in accordance with applicable law. Notwithstanding the foregoing, in the event that any Lender is or becomes so subject to such Taxes, at Borrower's sole election, Borrower may identify an Eligible Assignee not so subject to such Taxes to whom the Lender which is so subject shall assign its interest in the Loans pursuant to the terms of an Assignment and Acceptance substantially in the form attached as Exhibit A. (b) Indemnification. The Borrower will indemnify each Lender against, and reimburse each on demand for, the full amount of all Taxes (including, without limitation, any Taxes imposed by any Governmental Authority on amounts payable under this Section 13.1 resulting therefrom) incurred or paid by such Lender or any of its respective Affiliates and any liability (including penalties, interest, and out-of-pocket expenses paid to third parties) arising therefrom or with respect thereto, whether or not such Taxes were lawfully payable. A certificate as to any additional amount payable to any Person under this Section 13.1 submitted by a Lender to the Borrower shall, absent manifest error, be final, conclusive and binding upon all parties hereto. Each Lender agrees, within a reasonable time, to provide the Borrower and the Administrative Agent with such certificates as are reasonably required, and take such other actions as are reasonably necessary to claim such exemptions as such Lender may be entitled to claim in respect of all or a portion of any Taxes which are otherwise required to be paid or deducted or withheld pursuant to this Section 13.1 in respect of any payments under this Agreement or under the Notes. (c) Receipts. Within thirty (30) days after the date of any payment of Taxes by the Borrower, it will furnish to the Administrative Agent, at its address referred to in Section 15.8, the original or a certified copy of a receipt evidencing payment thereof. (d) Certifications. (i) Each Lender that is not created or organized under the laws of the United States or a political subdivision thereof shall deliver to the Borrower and the Administrative Agent on the Closing Date or the date on which such Lender becomes a Lender pursuant to Section 15.1 hereof a true and accurate certificate executed in duplicate by a duly authorized officer of such Lender to the effect that such Lender is eligible to receive payments hereunder and under the Notes without deduction or withholding of United States federal income tax (I) under the provisions of an applicable tax treaty concluded by the United States (in which case the certificate shall be accompanied by two duly completed copies of IRS Form 1001 (or any successor or substitute form or forms)), (II) under Section 1442(b) of the Internal Revenue Code (in which case the certificate shall be accompanied by two duly completed copies of IRS Form 4224 (or any successor or substitute form or forms)) or (III) under Section 871(h) of the Internal Revenue Code with respect to payments of "portfolio interest" (which certificate shall be substantially in the form of Exhibit F hereto and shall be accompanied by two duly completed copies of IRS Form W-8 (or any successor or substitute form or forms). 76 (ii) Each Lender further agrees to deliver to the Borrower and the Administrative Agent from time to time, a true and accurate certificate executed in duplicate by a duly authorized officer of such Lender before or promptly upon the occurrence of any event requiring a change in the most recent certificate previously delivered by it to the Borrower and the Administrative Agent pursuant to this Section 13.1(d). Each certificate required to be delivered pursuant to this Section 13.1(d)(ii) shall certify as to one of the following: (A) that such Lender can continue to receive payments hereunder and under the Notes without deduction or withholding of United States federal income tax; (B) that such Lender cannot continue to receive payments hereunder and under the Notes without deduction or withholding of United States federal income tax as specified therein but does not require additional payments pursuant to Section 13.1(a) because it is entitled to recover the full amount of any such deduction or withholding from a source other than the Borrower; or (C) that such Lender is no longer capable of receiving payments hereunder and under the Notes without deduction or withholding of United States federal income tax as specified therein and that it is not capable of recovering the full amount of the same from a source other than the Borrower. Each Lender agrees to deliver to the Borrower and the Administrative Agent further duly completed copies of the above-mentioned IRS forms on or before the earlier of (x) the date that any such form expires or becomes obsolete or otherwise is required to be resubmitted as a condition to obtaining an exemption from withholding from United States federal income tax and (y) fifteen (15) days after the occurrence of any event requiring a change in the most recent form previously delivered by such Lender to the Borrower and the Administrative Agent, unless any change in treaty, law, regulation, or official interpretation thereof which would render such form inapplicable or which would prevent the Lender from duly completing and delivering such form has occurred prior to the date on which any such delivery would otherwise be required and the Lender promptly advises the Borrower that it is not capable of receiving payments hereunder and under the Notes without any deduction or withholding of United States federal income tax. 13.2. Increased Capital. If after the date hereof any Lender determines that (i) the adoption or implementation of or any change in or in the interpretation or administration of any law or regulation or any guideline or request from any central bank or other Governmental Authority or quasi- governmental authority exercising jurisdiction, power or control over any Lender or banks or financial institutions generally (whether or not having the force of law), compliance with which affects or would affect the amount of capital required or expected to be maintained by such Lender or any corporation controlling such Lender and (ii) the amount of such capital is increased by or based upon the making or maintenance by any Lender of its Loans, any Lender's participation in or obligation to participate in the Loans or other advances made hereunder or the existence of any Lender's obligation to make Loans, then, in any such 77 case, within thirty (30) days after written demand by such Lender (with a copy of such demand to the Administrative Agent), the Borrower shall pay to the Administrative Agent for the account of such Lender, from time to time as specified by such Lender, additional amounts sufficient to compensate such Lender or such corporation therefor. Such demand shall be accompanied by a statement as to the amount of such compensation and include a brief summary of the basis for such demand. Such statement shall be conclusive and binding for all purposes, absent manifest error. Notwithstanding the foregoing, in the event of any such demand, at the Borrower's sole election, the Borrower may identify an Eligible Assignee not making such a demand to whom the demanding Lender shall assign its interest in the Loans pursuant to the terms of an Assignment and Acceptance substantially in the form attached as Exhibit A. 13.3. Changes; Legal Restrictions. If after the date hereof any Lender determines that the adoption or implementation of or any change in or in the interpretation or administration of any law or regulation or any guideline or request from any central bank or other Governmental Authority or quasi- governmental authority exercising jurisdiction, power or control over any Lender, or over banks or financial institutions generally (whether or not having the force of law), compliance with which: (a) does or will subject a Lender (or its Applicable Lending Office or Eurodollar Affiliate) to charges (other than taxes) of any kind which such Lender reasonably determines to be applicable to the Loan Commitments of the Lenders to make Eurodollar Rate Loans or change the basis of taxation of payments to that Lender of principal, fees, interest, or any other amount payable hereunder with respect to Eurodollar Rate Loans; or (b) does or will impose, modify, or hold applicable, in the reasonable determination of a Lender, any reserve (other than reserves taken into account in calculating the Eurodollar Rate), special deposit, compulsory loan, FDIC insurance or similar requirement against assets held by, or deposits or other liabilities in or for the account of, advances or loans by, commitments made, or other credit extended by, or any other acquisition of funds by, a Lender or any Applicable Lending Office or Eurodollar Affiliate of that Lender; and the result of any of the foregoing is to increase the cost to that Lender of making, renewing or maintaining the Loans or its Loan Commitment or to reduce any amount receivable thereunder; then, in any such case, within thirty (30) days after written demand by such Lender (with a copy of such demand to the Administrative Agent), the Borrower shall pay to the Administrative Agent for the account of such Lender, from time to time as specified by such Lender, such amount or amounts as may be necessary to compensate such Lender or its Eurodollar Affiliate for any such additional cost incurred or reduced amount received. Such demand shall be accompanied by a statement as to the amount of such compensation and include a brief summary of the basis for such demand. Such statement shall be conclusive and binding for all purposes, absent manifest error. Notwithstanding the foregoing, in the event of any such demand, at the Borrower's sole election, the Borrower may identify an Eligible Assignee not making such a demand to whom the demanding Lender shall assign its interest in the Loans pursuant to the terms of an Assignment and Acceptance substantially in the form attached as Exhibit A. 78 ARTICLE XIV BENEFIT OF LOANS The Borrower represents and warrants to the Lenders: (i) that the financing provided for herein is for the mutual benefit of both the Partnership and the Company; and (ii) that the pricing, terms and conditions of the financing provided for herein are more favorable than those that the Company could reasonably expect to obtain were it to seek alternative financing independently of the Partnership. ARTICLE XV MISCELLANEOUS 15.1. Assignments and Participations. (a) Assignments. No assignments or participations of any Lender's rights or obligations under this Agreement shall be made except in accordance with this Section 15.1. Each Lender may assign to one or more Eligible Assignees all or a portion of its rights and obligations under this Agreement in accordance with the provisions of this Section 15.1. (b) Limitations on Assignments. For so long as no Event of Default has occurred and is continuing, each assignment shall be subject to the following conditions: (i) each assignment shall be of a constant, and not a varying, ratable percentage of all of the assigning Lender's rights and obligations under this Agreement and, in the case of a partial assignment, shall be in a minimum principal amount of at least $5,000,000, (ii) each such assignment shall be to an Eligible Assignee approved by the Co-Agents and, so long as no Event of Default shall have occurred and be continuing hereunder, by the Borrower (which approval shall not be unreasonably withheld, conditioned or delayed by the Co- Agents or the Borrower), (iii) the parties to each such assignment shall execute and deliver to the Administrative Agent, for its acceptance and recording in the Register, an Assignment and Acceptance, and (iv) each Lender which maintains any Loans shall maintain minimum Loans of at least $5,000,000; provided, however, that, following the occurrence and during the continuation of an Event of Default hereunder, none of the foregoing restrictions on assignments shall apply, and, notwithstanding any subsequent cure or elimination of such Event of Default, neither the assignee nor the assignor in any assignment made during the continuance of such Event of Default shall thereafter be required to cause such assignment or any condition or state of affairs resulting therefrom to satisfy the foregoing requirements. Upon such execution, delivery, acceptance and recording in the Register, from and after the effective date specified in each Assignment and Acceptance and agreed to by the Administrative Agent, (A) the assignee thereunder shall, in addition to any rights and obligations hereunder held by it immediately prior to such effective date, if any, have the rights and obligations hereunder that have been assigned to it pursuant to such Assignment and Acceptance and shall, to the fullest extent permitted by law, have the same rights and benefits hereunder as if it were an original Lender hereunder, (B) the assigning Lender shall, to the extent that rights and obligations hereunder have been assigned by it pursuant to such Assignment and Acceptance, relinquish its rights and be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all or the remaining 79 portion of such assigning Lender's rights and obligations under this Agreement, the assigning Lender shall cease to be a party hereto) and (C) if requested by the assignee thereunder, the Borrower shall execute and deliver to such assignee a Note evidencing its obligations to such assignee with respect to the Loans upon the cancellation or amendment of the original thereby being replaced. (c) The Register. The Administrative Agent shall maintain at its address referred to in Section 15.8 a copy of each Assignment and Acceptance delivered to and accepted by it and a register (the "Register") for the recordation of the names and addresses of the Lenders, the Loan Commitment of, and the principal amount of the Loans owing to, each Lender from time to time and whether such Lender is an original Lender or the assignee of another Lender pursuant to an Assignment and Acceptance. The entries in the Register shall be conclusive and binding for all purposes, absent manifest error, and the Borrower and each of its Subsidiaries, GGP, Inc., the Administrative Agent and the other Lenders may treat each Person whose name is recorded in the Register as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by the Borrower or any Lender at any reasonable time and from time to time upon reasonable prior notice. (d) Fee. Upon its receipt of an Assignment and Acceptance executed by the assigning Lender and an Eligible Assignee and a processing and recordation fee of $3,500 (payable by the assignee to the Administrative Agent), the Administrative Agent shall, if such Assignment and Acceptance has been completed and is in compliance with this Agreement and in substantially the form of Exhibit A hereto, (i) accept such Assignment and Acceptance, (ii) record the information contained therein in the Register and (iii) give prompt notice thereof to the Borrower and the other Lenders; provided, however that no such processing and recordation fee shall be payable in connection with an assignment to an Affiliate of a Lender. (e) Participations. Each Lender may sell participations to one or more other financial institutions in or to all or a portion of its rights and obligations under and in respect of any and all facilities under this Agreement (including, without limitation, all or a portion of any or all of its Loan Commitment hereunder and the Loans owing to it); provided, however, that (i) such Lender's obligations under this Agreement (including, without limitation, its Loan Obligations hereunder) shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, (iii) the Borrower, the Co-Agents and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement, (iv) each participation shall be in a minimum amount of $5,000,000 and (v) such participant's rights to agree or to restrict such Lender's ability to agree to the modification, waiver or release of any of the terms of the Loan Documents, to consent to any action or failure to act by any party to any of the Loan Documents or any of their respective Affiliates, or to exercise or refrain from exercising any powers or rights which any Lender may have under or in respect of the Loan Documents, shall be limited to the right to consent to (A) reduction of the principal of, or rate or amount of interest on the Loans subject to such participation (other than by the payment or prepayment thereof), (B) postponement of any date fixed for any payment of principal of, or interest on, the Loan(s) subject to such participation and (C) release of any guarantor of the Obligations. 80 (f) Certain Transfers. Notwithstanding the foregoing or anything to the contrary contained herein (other than Section 15.1(b)(i) and Section 15.1(b)(iv), to which any transaction described in this Section 15.1(f) shall be subject), any of the Co-Agents may, from time to time in its sole discretion, without the consent of the Borrower or the Administrative Agent and without the payment of any fee, assign, pledge, convey, sell participations or otherwise sell or transfer, in one or more transactions and in whole or in part, any of its Loans, Loan Commitment, rights to payment of principal, interest or fee and other rights or interests created or existing under this Agreement (including any rights to any related collateral), to any Affiliate or branch of such Co- Agent, or to any trust or special purpose funding vehicle, whether or not such Co-Agent maintains any interest in such trust or special funding vehicle; provided, however, that no such assignment, pledge, conveyance, sale of participations or other sale or transfer shall cause the Borrower or any other party hereto to incur any greater expense or liability than the Borrower or such other party hereto would have incurred had no such assignment, pledge, conveyance, sale of participations or other sale or transfer occurred. (g) Payment to Participants. Anything in this Agreement to the contrary notwithstanding, in the case of any participation, all amounts payable by the Borrower under the Loan Documents shall be calculated and made in the manner and to the parties required hereby as if no such participation had been sold. (h) Lenders' Creation of Security Interests. Notwithstanding any other provision set forth in this Agreement, any Lender may at any time create a security interest in all or any portion of its rights under this Agreement (including, without limitation, Obligations owing to it and any Note held by it) in favor of any Federal Reserve bank in accordance with Regulation A. 15.2. Expenses. Generally. Subject to Section 15.2(b), the Borrower agrees upon demand to pay, or reimburse the each of the Co-Agents for all of their respective reasonable external audit, investigation and other expenses and for the reasonable fees, expenses and disbursements of one legal counsel and for all other reasonable out-of-pocket costs and expenses of every type and nature incurred by the Co-Agents, or any of them, in connection with (i) the audit and investigation of the Consolidated Businesses, the Real Properties and other Properties of the Consolidated Businesses in connection with the preparation, negotiation, and execution of the Loan Documents; (ii) the preparation, negotiation, execution, syndication and interpretation of this Agreement (including, without limitation, the satisfaction or attempted satisfaction of any of the conditions set forth in Article VI), the Loan Documents, and the making of the Loans hereunder; (iii) the ongoing administration (exclusive of customary and routine administration and oversight, the payment of which shall be satisfied by the Borrower's payment of the agency fee pursuant to Section 5.3(b)) of this Agreement and the Loans, including, without limitation, consultation with attorneys in connection therewith and with respect to the Co- Agents' rights and responsibilities under this Agreement and the other Loan Documents; (iv) the protection, collection or enforcement of any of the Obligations or the enforcement of any of the Loan Documents; (v) the commencement, defense or intervention in any court proceeding relating in any way to the Obligations, the Borrower, this Agreement or any of the other Loan Documents; (vi) the response to, and preparation for, any subpoena or request for document production with which any of the Co-Agents or any other Lender is served or deposition or other proceeding in which any Lender is called to testify, in each case, relating 81 in any way to the Obligations, a Real Property, the Borrower, any of the Consolidated Businesses, this Agreement or any of the other Loan Documents; and (vii) any amendments, consents, waivers, assignments, restatements, or supplements to any of the Loan Documents and the preparation, negotiation, and execution of the same. (b) After Default. The Borrower further agrees to pay or reimburse each of the Co-Agents and each of the Lenders upon demand for all out-of-pocket costs and expenses, including, without limitation, attorneys' fees (including allocated costs of internal counsel and costs of settlement) incurred by such entity after the occurrence of an Event of Default (i) in enforcing any Loan Document or Obligation or any security therefor or exercising or enforcing any other right or remedy available by reason of such Event of Default; (ii) in connection with any refinancing or restructuring of the credit arrangements provided under this Agreement in the nature of a "workout" or in any insolvency or bankruptcy proceeding; (iii) in commencing, defending or intervening in any litigation or in filing a petition, complaint, answer, motion or other pleadings in any legal proceeding relating to the Obligations, a Real Property, any of the Consolidated Businesses and related to or arising out of the transactions contemplated hereby or by any of the other Loan Documents; and (iv) in taking any other action in or with respect to any suit or proceeding (bankruptcy or otherwise) described in clauses (i) through (iii) above. 15.3. Indemnity. The Borrower further agrees (a) to defend, protect, indemnify, and hold harmless each of the Co-Agents and each and all of the other Lenders and each of their respective officers, directors, employees, attorneys and agents (including, without limitation, those retained in connection with the satisfaction or attempted satisfaction of any of the conditions set forth in Article VI) (collectively, the "Indemnitees") from and against any and all liabilities, obligations, losses (other than loss of profits), damages, penalties, actions, judgments, suits, claims, costs, reasonable expenses and disbursements of any kind or nature whatsoever (excluding any taxes and including, without limitation, the reasonable fees and disbursements of counsel for such Indemnitees in connection with any investigative, administrative or judicial proceeding, whether or not such Indemnitees shall be designated a party thereto), imposed on, incurred by, or asserted against such Indemnitees in any manner relating to or arising out of this Agreement or the other Loan Documents, or any act, event or transaction related or attendant thereto, the making of the Loans hereunder, the management of such Loans, the use or intended use of the proceeds of the Loans hereunder, the violation of, noncompliance with or liability under, any Environmental, Health or Safety Requirements of Law applicable to the operations of the Borrower or any of its Subsidiaries or any of the Properties or any of the other transactions contemplated by the Loan Documents (collectively, the "Indemnified Matters"); provided, however, the Borrower shall have no obligation to an Indemnitee hereunder with respect to Indemnified Matters caused by or resulting from the willful misconduct or gross negligence of such Indemnitee, as determined by a court of competent jurisdiction in a nonappealable final judgment; and (b) not to assert any claim against any of the Indemnitees, on any theory of liability, for consequential or punitive damages arising out of, or in any way in connection with, the Loan Commitments, the Credit Obligations, or the other matters governed by this Agreement and the other Loan Documents. To the extent that the undertaking to indemnify, pay and hold harmless set forth in the preceding sentence may be unenforceable because it is violative of any law or public policy, the Borrower shall contribute the maximum portion which it is permitted to pay and satisfy under applicable law, to the payment and satisfaction of all Indemnified Matters incurred by the Indemnitees. 82 15.4. Change in Accounting Principles. If any change in the accounting principles used in the preparation of the most recent financial statements referred to in Sections 8.1 or 8.2 are hereafter required or permitted by the rules, regulations, pronouncements and opinions of the Financial Accounting Standards Board or the American Institute of Certified Public Accountants (or successors thereto or agencies with similar functions) and are adopted by the Borrower, as applicable, with the agreement of its independent certified public accountants and such changes result in a change in the method of calculation of any of the covenants, standards or terms found in Article X, the parties hereto agree to enter into negotiations in order to amend such provisions so as to equitably reflect such changes with the desired result that the criteria for evaluating compliance with such covenants, standards and terms by the Borrower shall be the same after such changes as if such changes had not been made; provided, however, that no change in GAAP that would affect the method of calculation of any of the covenants, standards or terms shall be given effect in such calculations until such provisions are amended, in a manner satisfactory to the Co-Agents and the Borrower, to so reflect such change in accounting principles. 15.5. Setoff. In addition to any rights now or hereafter granted under applicable law, upon the occurrence and during the continuance of any Event of Default, each Lender is hereby authorized by the Borrower at any time or from time to time, without notice to any Person (any such notice being hereby expressly waived) to set off and to appropriate and to apply any and all deposits (general or special, including, but not limited to, indebtedness evidenced by certificates of deposit, whether matured or unmatured (but not including trust accounts)) and any other Indebtedness at any time held or owing by such Lender to or for the credit or the account of the Borrower against and on account of the Obligations of the Borrower then due to such Lender, including, but not limited to, all Loans and all claims of any nature or description arising out of or in connection with this Agreement, irrespective of whether or not (i) such Lender shall have made any demand hereunder or (ii) the Administrative Agent, at the request or with the consent of the Requisite Lenders, shall have declared the principal of and interest on the Loans and other amounts due hereunder to be due and payable as permitted by Article XI and even though such Obligations may be contingent or unmatured. Each Lender agrees that it shall not, without the express consent of the Requisite Lenders, and that it shall, to the extent it is lawfully entitled to do so, upon the request of the Requisite Lenders, exercise its setoff rights hereunder against any accounts of the Borrower now or hereafter maintained with such Lender. 15.6. Ratable Sharing. The Lenders agree among themselves that (i) with respect to all amounts received by them which are applicable to the payment of the Obligations (excluding the fees described in Sections 5.2(f) and 5.3 and Article XIII) equitable adjustment will be made so that, in effect, all such amounts will be shared among them ratably in accordance with their Pro Rata Shares, whether received by voluntary payment, by the exercise of the right of setoff or banker's lien, by counterclaim or crossaction or by the enforcement of any or all of the Obligations (excluding the amounts described in Sections 5.2(f) and 5.3 and Article XIII), (ii) if any of them shall by voluntary payment or by the exercise of any right of counterclaim, setoff, banker's lien or otherwise, receive payment of a proportion of the aggregate amount of the Obligations held by it, which is greater than the amount which such Lender is entitled to receive hereunder, the Lender receiving such excess payment shall purchase, without recourse or warranty, an undivided interest and participation (which it shall be deemed to have done simultaneously upon the receipt of such payment) in such Obligations owed to the others so that 83 all such recoveries with respect to such Obligations shall be applied ratably in accordance with their Pro Rata Shares; provided, however, that if all or part of such excess payment received by the purchasing party is thereafter recovered from it, those purchases shall be rescinded and the purchase prices paid for such participations shall be returned to such party to the extent necessary to adjust for such recovery, but without interest except to the extent the purchasing party is required to pay interest in connection with such recovery. The Borrower agrees that any Lender so purchasing a participation from another Lender pursuant to this Section 15.6 may, to the fullest extent permitted by law, exercise all its rights of payment (including, subject to Section 15.5, the right of setoff) with respect to such participation as fully as if such Lender were the direct creditor of the Borrower in the amount of such participation. 15.7. Amendments and Waivers. General Provisions. Unless otherwise provided for or required in this Agreement, no amendment or modification of any provision of this Agreement or any of the other Loan Documents shall be effective without the written agreement of the Requisite Lenders (which the Requisite Lenders shall have the right to grant or withhold in their sole discretion) and the Borrower; provided, however, that the Borrower's agreement shall not be required for any amendment or modification of Article XII (other than such Sections thereof on which the Borrower is entitled to rely or which the Borrower is entitled to enforce). No termination or waiver of any provision of this Agreement or any of the other Loan Documents, or consent to any departure by the Borrower therefrom, other than those specifically reserved to the Co-Agents (or either of them) or the other Lenders, shall be effective without the written concurrence of the Requisite Lenders, which the Requisite Lenders shall have the right to grant or withhold in their sole discretion. All amendments, waivers and consents not specifically reserved to the Co-Agents (or either of them) or the Lenders in Section 15.7(b), 15.7(c), and in other provisions of this Agreement shall require only the approval of the Requisite Lenders. Any waiver or consent shall be effective only in the specific instance and for the specific purpose for which it was given. No notice to or demand on the Borrower in any case shall entitle the Borrower to any other or further notice or demand in similar or other circumstances. (b) Amendments. Consents and Waivers by Affected Lenders. Any amendment, modification, termination, waiver or consent with respect to any of the following provisions of this Agreement shall be effective only by a written agreement, signed by each Lender affected thereby as described below: (i) waiver of any of the conditions specified in Sections 6.1 and 6.2 (except with respect to a condition based upon another provision of this Agreement, the waiver of which requires the concurrence of only the Requisite Lenders), (ii) increase in the amount of such Lender's Loan Obligations, (iii) reduction of the principal of, rate or amount of interest on the Loans or any fees or other amounts payable to such Lender (other than by the payment or prepayment thereof), and (iv) postponement or extension of any date (other than the Maturity Date postponement or extension of which is governed by Section 15.7(c)(i)) fixed for any payment of principal of, or interest on, the Loans or any fees or other amounts payable to 84 such Lender (except with respect to any modifications of the applicable provisions relating to prepayments of Loans and other Obligations which are governed by Section 4.2(b)). (c) Amendments, Consents and Waivers by All Lenders. Any amendment, modification, termination, waiver or consent with respect to any of the following provisions of this Agreement shall be effective only by a written agreement, signed by each Lender: (i) postponement or extension of the Maturity Date, (ii) change in the definition of Requisite Lenders or in the aggregate Pro Rata Share of the Lenders which shall be required for the Lenders or any of them to take action hereunder or under the other Loan Documents, (iii) amendment of Section 15.6 or this Section 15.7, (iv) assignment of any right or interest in or under this Agreement or any of the other Loan Documents by the Borrower, (v) any release of any guarantor of the Obligations prior to the satisfaction in full of the Obligations, and (vi) waiver of any Event of Default described in Section 11.1(a). (d) Agent Authority. The Administrative Agent may, but shall have no obligation to, with the written concurrence of any Lender, execute amendments, modifications, waivers or consents on behalf of such Lender. Notwithstanding anything to the contrary contained in this Section 15.7, no amendment, modification, waiver or consent shall affect the rights or duties of the Administrative Agent as Administrative Agent or the Syndication Agent as Syndication Agent under this Agreement and the other Loan Documents, unless made in writing and signed by the applicable Co-Agent in addition to the Lenders required above to take such action. 15.8. Notices. Unless otherwise specifically provided herein, any notice or other communication herein required or permitted to be given shall be in writing and may be personally served, sent by facsimile transmission or by courier service or United States certified mail and shall be deemed to have been given when delivered in person or by courier service, upon receipt of a facsimile transmission, or four (4) Business Days after deposit in the United States mail with postage prepaid and properly addressed. Notices to either of the Co-Agents pursuant to Articles II, IV or XII shall not be effective until received by such Co-Agent. For the purposes hereof, the addresses of the parties hereto (until notice of a change thereof is delivered as provided in this Section 15.8) shall be as set forth below each party's name on the signature pages hereof or the signature page of any applicable Assignment and Acceptance or joinder agreement pursuant to Section 3.2, or, as to each party, at such other address as may be designated by such party in a written notice to all of the other parties to this Agreement. 15.9. Survival of Warranties and Agreements. All representations and warranties made herein and all obligations of the Borrower in respect of taxes, indemnification 85 and expense reimbursement shall survive the execution and delivery of this Agreement and the other Loan Documents, the making and repayment of the Loans and the termination of this Agreement and shall not be limited in any way by the passage of time or occurrence of any event (other than as set forth in Section 6.2) and shall expressly cover time periods when either Co-Agent or any of the other Lenders may have come into possession or control of any Property of the Borrower or any of its Subsidiaries. Notwithstanding the foregoing, however, such representations, warranties and obligations shall terminate and be of no further force and effect after the earlier of (a) two years after the Maturity Date or (b) payment in full of the Obligations. 15.10. Failure or Indulgence Not Waiver; Remedies Cumulative. Subject to the terms of Section 15.7(d) of this Agreement, no failure or delay on the part of the Co-Agents or any other Lender in the exercise of any power, right or privilege under any of the Loan Documents shall impair such power, right or privilege or be construed to be a waiver of any default or acquiescence therein, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege. All rights and remedies existing under the Loan Documents are cumulative to and not exclusive of any rights or remedies otherwise available. 15.11. Marshalling: Payments Set Aside. None of the Co-Agents or any Lender shall be under any obligation to marshal any assets in favor of the Borrower or any other party or against or in payment of any or all of the Obligations. To the extent that the Borrower makes a payment or payments to the Co-Agents (or either of them) or any other Lender or any such Person exercises its rights of setoff, and such payment or payments or the proceeds of such enforcement or setoff or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside or required to be repaid to a trustee, receiver or any other party, then to the extent of such recovery, the obligation or part thereof originally intended to be satisfied, and all right and remedies therefor, shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred. 15.12. Severability. In case any provision in or obligation under this Agreement or the other Loan Documents shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby. 15.13. Headings. Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement or be given any substantive effect. 15.14. Governing Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED, IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. 15.15. Limitation of Liability. No claim may be made by any Lender, the Administrative Agent, the Syndication Agent or any other Person against any Lender (acting in any capacity hereunder) or the Affiliates, directors, officers, employees, attorneys or agents of 86 any of them for any consequential or punitive damages in respect of any claim for breach of contract or any other theory of liability arising out of or related to the transactions contemplated by this Agreement, or any act, omission or event occurring in connection therewith; and each Lender and each Co-Agent hereby waives, releases and agrees not to sue upon any such claim for any such damages, whether or not accrued and whether or not known or suspected to exist in its favor. In addition, no claim may be made by any Lender, either Co-Agent or any other Person against any directors, officers or trustees of the Borrower. 15.16. Successors and Assigns. This Agreement and the other Loan Documents shall be binding upon the parties hereto and their respective successors and assigns and shall inure to the benefit of the parties hereto and their successors and permitted assigns. 15.17. Submission to Jurisdiction. Jurisdiction; Service of Process. The Borrower hereby irrevocably and unconditionally : (i) submits for itself and its Property in any legal action or proceeding relating to this Agreement and the other Loan Documents to which it is a party, or for recognition and enforcement of any judgment in respect thereof, to the non-exclusive general jurisdiction of the courts of the State of New York, the courts of the United States for the Southern District of New York, and appellate courts from any thereof; (ii) consents that any such action or proceeding may be brought in such courts and waives any objection that it may now or hereafter have to the venue of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same; (iii) agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to the Borrower at its address set forth in Section 15.8 or at such other address of which the Administrative Agent shall have been notified pursuant thereto; and (iv) agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall limit the right to sue in any other jurisdiction. (b) Waiver of Jury Trial. EACH OF THE CO-AGENTS, THE LENDERS AND THE BORROWER IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN. 15.18. Counterparts; Effectiveness; Inconsistencies. This Agreement and any amendments, waivers, consents, or supplements hereto may be executed in counterparts, each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument. This Agreement shall become effective against the Borrower and each Lender on the Closing Date. This Agreement and each of the other Loan Documents shall be construed to the extent reasonable to be consistent one 87 with the other, but to the extent that the terms and conditions of this Agreement are actually inconsistent with the terms and conditions of any other Loan Document, this Agreement shall govern. In the event the Lenders enter into any co-lender agreement with the Administrative Agent pertaining to the Lenders' respective rights with respect to voting on any matter referenced in this Agreement or the other Loan Documents on which the Lenders have a right to vote under the terms of this Agreement or the other Loan Documents, such co-lender agreement shall be construed to the extent reasonable to be consistent with this Agreement and the other Loan Documents, but to the extent that the terms and conditions of such co-lender agreement are actually inconsistent with the terms and conditions of this Agreement and/or the other Loan Documents, such co-lender agreement shall govern as among the Administrative Agent and the Lenders. Notwithstanding the foregoing, any rights reserved to the Administrative Agent under this Agreement and the other Loan Documents shall not be varied or in any way affected by such co-lender agreement and the rights and obligations of the Borrower under the Loan Documents will not be varied. 15.19. Limitation on Agreements. All agreements between the Borrower, the Co-Agents and each Lender in the Loan Documents are hereby expressly limited so that in no event shall any of the Loans or other amounts payable by the Borrower under any of the Loan Documents be directly or indirectly secured (within the meaning of Regulation U) by Margin Stock. 15.20. Confidentiality. Subject to Section 15.1(g), the Lenders shall hold all nonpublic information obtained pursuant to the requirements of this Agreement, and identified as such by the Borrower, in accordance with such Lender's customary procedures for handling confidential information of this nature and in accordance with safe and sound banking practices (provided that such Lender may share such information with its Affiliates in accordance with such Lender's customary procedures for handling confidential information of this nature and provided further that such Affiliate shall hold such information confidential) and in any event the Lenders may make disclosure reasonably required by a bona fide offeree, transferee or participant in connection with the contemplated transfer or participation or as required or requested by any Governmental Authority or representative thereof or pursuant to legal process and shall require any such offeree, transferee or participant to agree (and require any of its offerees, transferees or participants to agree) to comply with this Section 15.20. In no event shall any Lender be obligated or required to return any materials furnished by the Borrower; provided, however, each offeree shall be required to agree that if it does not become a transferee or participant it shall return all materials furnished to it by the Borrower or any Lender in connection with this Agreement. Any and all confidentiality agreements entered into between any Lender and the Borrower shall survive the execution of this Agreement. 15.21. Disclaimers. The Co-Agents and the Lenders shall not be liable to any contractor, subcontractor, supplier, laborer, architect, engineer, tenant or other party for services performed or materials supplied in connection with any work performed on the Real Properties, including any TI Work. The Co- Agents and the Lenders shall not be liable for any debts or claims accruing in favor of any such parties against the Borrower or others or against any of the Real Properties. The Borrower is not and shall not be an agent of any of the Co- Agents or the Lenders for any purposes and none of the Lenders nor the Co-Agents shall be deemed partners or joint venturers with Borrower or any of its Affiliates as a result of the consummation of the 88 transactions contemplated by this Agreement. None of the Co-Agents or the Lenders shall be deemed to be in privity of contract with any contractor or provider of services to any Real Property, nor shall any payment of funds directly to a contractor or subcontractor or provider of services be deemed to create any third party beneficiary status or recognition of same by any of the Co-Agents or the Lenders and the Borrower agrees to hold the Co-Agents and the Lenders harmless from any of the damages and expenses resulting from such a construction of the relationship of the parties or any assertion thereof solely to the extent, if any, that the Borrower has requested that the Co-Agents or any Lender deal directly with or make any payments directly to such a contractor or provider of services. 15.22. [Intentionally Omitted]. 15.23. Entire Agreement. This Agreement, taken together with all of the other Loan Documents, embodies the entire agreement and understanding among the parties hereto and supersedes all prior agreements and understandings, written and oral, relating to the subject matter hereof. 15.24. No Third Party Beneficiaries. Nothing in this Agreement or any other Loan Document, whether express or implied, is intended to confer any rights or remedies under or by reason of this Agreement or such other Loan Documents on any third person nor is anything herein or therein intended to relieve or discharge the obligation or liability of any third person or give any third person any right of subrogation or action over or against any party hereto. [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK] IN WITNESS WHEREOF, this Agreement has been duly executed as of the date first above written. BORROWER: --------- GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By:__________________________________ Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By:__________________________________ Name: Bernard Freibaum Title: Executive Vice President Notice Address for Borrower: ---------------------------- c/o General Growth Properties, Inc. 110 North Wacker Drive Chicago, Illinois 60606 Attn: Chief Financial Officer Telecopy: (312) 960-5463 with a copy to: Neal, Gerber & Eisenberg Two North LaSalle Street, Suite 2200 Chicago, Illinois 60602 Attn: Marshall E. Eisenberg Telecopy: (312) 269-1747 Pro Rata Share: 50% BANKERS TRUST COMPANY, as Administrative Agent and Lender By:_________________________________ Name: Title: Notice Address: --------------- 130 Liberty Street New York, New York 10006 Attn: Anita Cheung Telecopy: (212) 669-0732 with a copy to: Simpson Thacher & Bartlett 425 Lexington Avenue New York, New York 10017 Attn: Scott Kobak Telecopy: (212) 455-2502 Pro Rata Share: 50% LEHMAN COMMERCIAL PAPER INC., as Syndication Agent and Lender By:_________________________________ Name: Title: Notice Address: --------------- 3 World Financial Center 200 Vesey Street, 12th Floor New York, New York 10285 Attn: Thomas Buffa Telecopy: (212) 526-0035 with a copy to: Hatfield Philips Suite 2300, Marquis Two Tower 285 Peachtree Center Avenue Atlanta, Georgia 30303 Attn: Jennifer Farthing Bean Telecopy: (404) 420-5610 EX-10.(P) 3 dex10p.txt 7/31/00 PROMISSORY NOTE IN FAVOR OR BT Exhibit 10(p) NOTE $50,000,000.00 New York, New York July 31, 2000 FOR VALUE RECEIVED, the undersigned, GGP LIMITED PARTNERSHIP, a Delaware limited partnership, and GGPLP L.L.C., a Delaware limited liability company (individually and collectively, the "Borrower"), jointly and severally, hereby unconditionally promise to pay to the order of BANKERS TRUST COMPANY (the "Lender") at the office of Bankers Trust Company, located at 130 Liberty Street, New York, New York 10006 in lawful money of the United States of America and in immediately available funds, the principal amount of FIFTY MILLION DOLLARS ($50,000,000.00), or, if less, the unpaid principal amount of the Loans made by the Lender pursuant to Section 2.1 or Article III of the Term Loan Agreement, as hereinafter defined. The Borrower further agrees to pay interest in like money at such office on the unpaid principal amount hereof from time to time outstanding at the rates and on the dates specified in Section 5.1 of such Term Loan Agreement. The holder of this Note is authorized to endorse on the schedules annexed hereto and made a part hereof or on a continuation thereof which shall be attached hereto and made a part hereof the date, type and amount of the Loan(s) evidenced hereby and the date and amount of each payment or prepayment of principal with respect thereto, each conversion of all or a portion thereof to another type, each continuation of all or a portion thereof as the same type and, in the case of Eurodollar Rate Loans, the length of each Interest Period with respect thereto. Each such endorsement shall constitute prima facie evidence of the accuracy of the information endorsed. The failure to make any such endorsement shall not affect the obligations of the Borrower in respect of such Loan. This Note (a) is one of the Notes referred to in the Term Loan Agreement dated as of July 31, 2000 (as amended, supplemented or otherwise modified from time to time, the "Term Loan Agreement"), among the Borrower, the Lender, the other institutions from time to time parties thereto as lenders and Bankers Trust Company, as administrative agent, (b) is subject to the provisions of the Term Loan Agreement and (c) is subject to voluntary and mandatory prepayment in whole or in part as provided in the Term Loan Agreement. This Note is guaranteed as provided in the Loan Documents. Reference is made to the Loan Documents for the nature and extent of the guarantees, the terms and conditions upon which each guarantee was granted and the rights of the holder of this Note in respect thereof. Upon the occurrence and during the continuance of any one or more of the Events of Default, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable, all as provided in the Term Loan Agreement. 2 To the extent not prohibited by law, all parties now and hereafter liable with respect to this Note, whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive presentment, demand, protest and all other notices of any kind. Unless otherwise defined herein, terms defined in the Term Loan Agreement and used herein shall have the meanings given to them in the Term Loan Agreement. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN THE TERM LOAN AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND IN ACCORDANCE WITH THE REGISTRATION AND OTHER PROVISIONS OF SECTION 15.1 OF THE TERM LOAN AGREEMENT. THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. [The remainder of this page is intentionally left blank] IN WITNESS WHEREOF, the Borrower has caused this Note to be executed and delivered by its duly authorized officer as of the day and year first above written. GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By:___________________________________ Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By:___________________________________ Name: Bernard Freibaum Title: Executive Vice President
Schedule A to Note - ------------------------------------------------------------------------------------------------------------------------------------ LOANS, CONVERSIONS AND REPAYMENTS OF BASE RATE LOANS - ------------------------------------------------------------------------------------------------------------------------------------ Amount Amount of Amount of Base Rate Unpaid Principal Amount of Converted to Principal of Base Loans Converted to Balance of Date Base Rate Loans Base Rate Loans Rate Loans Repaid Eurodollar Rate Loans Base Rate Loans Notation Made By - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------
Schedule B to Note ------- LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR RATE LOANS - ------------------------------------------------------------------------------------------------------------------------------------ Amount Interest Period Amount of Amount of Unpaid Principal Amount of Converted and Eurodollar Principal of Eurodollar Rate Balance of Eurodollar to Eurodollar Rate with Eurodollar Rate Loans Converted Eurodollar Notation Date Rate Loans Rate Loans Respect Thereto Loans Repaid to Base Rate Loans Rate Loans Made By - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------
EX-10.(Q) 4 dex10q.txt 7/31/00 PROMISSORY NOTE IN FAVOR OF LEHMAN Exhibit 10(q) NOTE $50,000,000.00 New York, New York July 31, 2000 FOR VALUE RECEIVED, the undersigned, GGP LIMITED PARTNERSHIP, a Delaware limited partnership, and GGPLP L.L.C., a Delaware limited liability company (individually and collectively, the "Borrower"), jointly and severally, hereby unconditionally promise to pay to the order of LEHMAN COMMERCIAL PAPER INC. (the "Lender") at the office of Bankers Trust Company, located at 130 Liberty Street, New York, New York 10006 in lawful money of the United States of America and in immediately available funds, the principal amount of FIFTY MILLION DOLLARS ($50,000,000.00), or, if less, the unpaid principal amount of the Loans made by the Lender pursuant to Section 2.1 or Article III of the Term Loan Agreement, as hereinafter defined. The Borrower further agrees to pay interest in like money at such office on the unpaid principal amount hereof from time to time outstanding at the rates and on the dates specified in Section 5.1 of such Term Loan Agreement. The holder of this Note is authorized to endorse on the schedules annexed hereto and made a part hereof or on a continuation thereof which shall be attached hereto and made a part hereof the date, type and amount of the Loan(s) evidenced hereby and the date and amount of each payment or prepayment of principal with respect thereto, each conversion of all or a portion thereof to another type, each continuation of all or a portion thereof as the same type and, in the case of Eurodollar Rate Loans, the length of each Interest Period with respect thereto. Each such endorsement shall constitute prima facie evidence of the accuracy of the information endorsed. The failure to make any such endorsement shall not affect the obligations of the Borrower in respect of such Loan. This Note (a) is one of the Notes referred to in the Term Loan Agreement dated as of July 31, 2000 (as amended, supplemented or otherwise modified from time to time, the "Term Loan Agreement"), among the Borrower, the Lender, the other institutions from time to time parties thereto as lenders and Bankers Trust Company, as administrative agent, (b) is subject to the provisions of the Term Loan Agreement and (c) is subject to voluntary and mandatory prepayment in whole or in part as provided in the Term Loan Agreement. This Note is guaranteed as provided in the Loan Documents. Reference is made to the Loan Documents for the nature and extent of the guarantees, the terms and conditions upon which each guarantee was granted and the rights of the holder of this Note in respect thereof. Upon the occurrence and during the continuance of any one or more of the Events of Default, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable, all as provided in the Term Loan Agreement. 2 To the extent not prohibited by law, all parties now and hereafter liable with respect to this Note, whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive presentment, demand, protest and all other notices of any kind. Unless otherwise defined herein, terms defined in the Term Loan Agreement and used herein shall have the meanings given to them in the Term Loan Agreement. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN THE TERM LOAN AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND IN ACCORDANCE WITH THE REGISTRATION AND OTHER PROVISIONS OF SECTION 15.1 OF THE TERM LOAN AGREEMENT. THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. [The remainder of this page is intentionally left blank] IN WITNESS WHEREOF, the Borrower has caused this Note to be executed and delivered by its duly authorized officer as of the day and year first above written. GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By:______________________________________________ Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By:______________________________________________ Name: Bernard Freibaum Title: Executive Vice President Schedule A to Note ------------------------------------------------------------------------------- LOANS, CONVERSIONS AND REPAYMENTS OF BASE RATE LOANS
- ----------------------------------------------------------------------------------------------------------------------------------- Amount Amount of Base Rate Unpaid Principal Converted to Amount of Principal of Loans Converted to Balance of Base Rate Notation Date Amount of Base Rate Loans Base Rate Loans Base Rate Loans Repaid Eurodollar Rate Loans Loans Made By - ----------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- - -----------------------------------------------------------------------------------------------------------------------------------
Schedule B to Note ------- LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR RATE LOANS
- ------------------------------------------------------------------------------------------------------------------------------------ Unpaid Principal Amount of Amount Converted Interest Period and Amount of Principal Amount of Eurodollar Balance of Eurodollar Rate to Eurodollar Rate Eurodollar Rate with of Eurodollar Rate Rate Loans Converted Eurodollar Rate Notation Date Loans Loans Respect Thereto Loans Repaid to Base Rate Loans Loans Made By - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------
EX-10.(R) 5 dex10r.txt 9/1/00 JOINDER AGREEMENT -- BAYERISCHE HYPO Exhibit 10(r) EXECUTION COPY JOINDER AGREEMENT Reference is made to the Term Loan Agreement, dated as of July 31, 2000 (as amended, supplemented or otherwise modified from time to time, the "Loan Agreement"), among GGP Limited Partnership, GGPLP L.L.C., the institutions from time to time parties thereto as Lenders, Lehman Commercial Paper Inc., as Syndication Agent, and Bankers Trust Company, as Administrative Agent. Unless otherwise defined herein, terms defined in the Loan Agreement and used herein shall have the meanings given to them in the Loan Agreement. Bayerische Hypo-Und Vereinsbank AG, New York Branch (the "Joining Lender") (i) represents and warrants that it is legally authorized to enter into this Joinder Agreement; (ii) confirms that it has received a copy of the Loan Agreement, together with copies of such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Joinder Agreement; (iii) agrees that it will, independently and without reliance upon the Co-Agents or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Agreement; (iv) appoints and authorizes the Co-Agents to take such action as agent on its behalf and to exercise such powers under the Loan Agreement as are delegated to the Co-Agents by the terms thereof, together with such powers as are reasonably incidental thereto; (v) agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Loan Agreement are required to be performed by it as a Lender; (vi) confirms that, to the best of its knowledge, as of the date hereof, it is not subject to any law, regulation or guideline from any central bank or other Governmental Authority or quasi-governmental authority exercising jurisdiction, power or control over it, which would subject the Borrower to the payment of additional compensation under Section 13.2 or under Section 13.3 of the Loan Agreement; (vii) specifies as its Domestic Lending Office (and address for notices) and Eurodollar Lending Office(s) the offices set forth on Schedule 1 hereto; and (viii) if the Joining Lender is organized under the laws of a jurisdiction outside the United States, attaches the forms prescribed by the Internal Revenue Service of the United States certifying as to the Joining Lender's status for purposes of determining exemption from United States withholding taxes with respect to all payments to be made to the Joining Lender under the Loan Agreement and the Notes or such other documents as are necessary to indicate that all such payments are subject to such taxes at a rate reduced by an applicable tax treaty. Upon execution and delivery of this Joinder Agreement by the parties hereto as provided in Section 3.2 of the Loan Agreement, (a) the Joining Lender hereby shall be a party to the Loan Agreement, shall be a Lender under the Loan Agreement having the Loan Commitments set forth in Schedule 1 hereto, effective as of the date of this Joinder Agreement, and shall have the rights and obligations of a Lender under the Loan Agreement and (b) the Maximum Aggregate Loan Amount shall be increased to $125,000,000.00. THIS JOINDER AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. 2 This Joinder Agreement may be executed by one or more of the parties hereto on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. Delivery of an executed signature page hereof by facsimile transmission shall be effective as delivery of a manually executed counterpart hereof. 3 IN WITNESS WHEREOF, the parties hereto have caused this Joinder Agreement to be duly executed and delivered by their proper and duly authorized officers as of this 1/st/ day of September, 2000. BAYERISCHE HYPO-UND VEREINSBANK AG, NEW YORK BRANCH By: _____________________________________ Name: Title: Accepted and agreed: GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: _______________________________________ Name: Bernard Freibaum Title: Executive Vice President GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware corporation, its managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation. its sole general partner By: ___________________________________ Name: Bernard Freibaum Title: Executive Vice President Schedule 1 LOAN COMMITMENT AND NOTICE ADDRESSES 1. Name of Lender: Bayerische Hypo-und Vereinsbank AG, New York Branch Notice Address and Domestic Lending Office: 150 East 42/nd/ Street New York, New York 10017 Attention: Christine Elcik Telephone: 212-672-5740 Facsimile: 212-672-5527 Eurodollar Lending Office: 150 East 42/nd/ Street New York, New York 10017 Attention: Christine Elcik Telephone: 212-672-5740 Facsimile: 212-672-5527 2. Loan Commitment: $25,000,000.00 Adjusted Pro Rata Share: 20.0% EX-10.(S) 6 dex10s.txt 9/1/00 PROMISSORY NOTE IN FAVOR OF HYPO Exhibit 10(s) NOTE $25,000,000.00 New York, New York September 1, 2000 FOR VALUE RECEIVED, the undersigned, GGP LIMITED PARTNERSHIP, a Delaware limited partnership, and GGPLP L.L.C., a Delaware limited liability company (individually and collectively, the "Borrower"), jointly and severally, hereby unconditionally promise to pay to the order of BAYERISCHE HYPO-UND VEREINSBANK AG, NEW YORK BRANCH (the "Lender") at the office of Bankers Trust Company, located at 130 Liberty Street, New York, New York 10006 in lawful money of the United States of America and in immediately available funds, the principal amount of TWENTY-FIVE MILLION DOLLARS ($25,000,000.00), or, if less, the unpaid principal amount of the Loans made by the Lender pursuant to Section 2.1 or Article III of the Term Loan Agreement, as hereinafter defined. The Borrower further agrees to pay interest in like money at such office on the unpaid principal amount hereof from time to time outstanding at the rates and on the dates specified in Section 5.1 of such Term Loan Agreement. The holder of this Note is authorized to endorse on the schedules annexed hereto and made a part hereof or on a continuation thereof which shall be attached hereto and made a part hereof the date, type and amount of the Loan(s) evidenced hereby and the date and amount of each payment or prepayment of principal with respect thereto, each conversion of all or a portion thereof to another type, each continuation of all or a portion thereof as the same type and, in the case of Eurodollar Rate Loans, the length of each Interest Period with respect thereto. Each such endorsement shall constitute prima facie evidence of the accuracy of the information endorsed. The failure to make any such endorsement shall not affect the obligations of the Borrower in respect of such Loan. This Note (a) is one of the Notes referred to in the Term Loan Agreement dated as of July 31, 2000 (as amended, supplemented or otherwise modified from time to time, the "Term Loan Agreement"), among the Borrower, the Lender, the other institutions from time to time parties thereto as lenders and Bankers Trust Company, as administrative agent, (b) is subject to the provisions of the Term Loan Agreement and (c) is subject to voluntary and mandatory prepayment in whole or in part as provided in the Term Loan Agreement. This Note is guaranteed as provided in the Loan Documents. Reference is made to the Loan Documents for the nature and extent of the guarantees, the terms and conditions upon which each guarantee was granted and the rights of the holder of this Note in respect thereof. Upon the occurrence and during the continuance of any one or more of the Events of Default, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable, all as provided in the Term Loan Agreement. 2 To the extent not prohibited by law, all parties now and hereafter liable with respect to this Note, whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive presentment, demand, protest and all other notices of any kind. Unless otherwise defined herein, terms defined in the Term Loan Agreement and used herein shall have the meanings given to them in the Term Loan Agreement. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN THE TERM LOAN AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND IN ACCORDANCE WITH THE REGISTRATION AND OTHER PROVISIONS OF SECTION 15.1 OF THE TERM LOAN AGREEMENT. THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. [The remainder of this page is intentionally left blank] IN WITNESS WHEREOF, the Borrower has caused this Note to be executed and delivered by its duly authorized officer as of the day and year first above written. GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: -------------------------------------------- Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: -------------------------------------------- Name: Bernard Freibaum Title: Executive Vice President Schedule A to Note ------- LOANS, CONVERSIONS AND REPAYMENTS OF BASE RATE LOANS
- ------------------------------------------------------------------------------------------------------------------------------------ Amount Amount of Principal Amount of Base Rate Unpaid Principal Amount of Base Converted to of Base Rate Loans Converted to Balance of Base Date Rate Loans Base Rate Loans Loans Repaid Eurodollar Rate Loans Rate Loans Notation Made By - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------
Schedule B to Note ------- LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR RATE LOANS
- ------------------------------------------------------------------------------------------------------------------------------------ Interest Period and Amount of Principal Amount of Eurodollar Unpaid Principal Amount of Amount Converted Eurodollar Rate of Eurodollar Rate Loans Balance of Eurodollar to Eurodollar with Respect Rate Loans Converted to Base Eurodollar Notation Date Rate Loans Rate Loans Thereto Repaid Rate Loans Rate Loans Made By - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------
EX-10.(T) 7 dex10t.txt 9/22/00 JOINDER AGREEMENT -- FLEET Exhibit 10(t) EXECUTION COPY JOINDER AGREEMENT Reference is made to the Term Loan Agreement, dated as of July 31, 2000 (as amended, supplemented or otherwise modified from time to time, the "Loan Agreement"), among GGP Limited Partnership, GGPLP L.L.C., the institutions from time to time parties thereto as Lenders, Lehman Commercial Paper Inc., as Syndication Agent, and Bankers Trust Company, as Administrative Agent. Unless otherwise defined herein, terms defined in the Loan Agreement and used herein shall have the meanings given to them in the Loan Agreement. Fleet National Bank (the "Joining Lender") (i) represents and warrants that it is legally authorized to enter into this Joinder Agreement; (ii) confirms that it has received a copy of the Loan Agreement, together with copies of such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Joinder Agreement; (iii) agrees that it will, independently and without reliance upon the Co-Agents or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Agreement; (iv) appoints and authorizes the Co- Agents to take such action as agent on its behalf and to exercise such powers under the Loan Agreement as are delegated to the Co-Agents by the terms thereof, together with such powers as are reasonably incidental thereto; (v) agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Loan Agreement are required to be performed by it as a Lender; (vi) confirms that, to the best of its knowledge, as of the date hereof, it is not subject to any law, regulation or guideline from any central bank or other Governmental Authority or quasi-governmental authority exercising jurisdiction, power or control over it, which would subject the Borrower to the payment of additional compensation under Section 13.2 or under Section 13.3 of the Loan Agreement; (vii) specifies as its Domestic Lending Office (and address for notices) and Eurodollar Lending Office(s) the offices set forth on Schedule 1 hereto; and (viii) if the Joining Lender is organized under the laws of a jurisdiction outside the United States, attaches the forms prescribed by the Internal Revenue Service of the United States certifying as to the Joining Lender's status for purposes of determining exemption from United States withholding taxes with respect to all payments to be made to the Joining Lender under the Loan Agreement and the Notes or such other documents as are necessary to indicate that all such payments are subject to such taxes at a rate reduced by an applicable tax treaty. Upon execution and delivery of this Joinder Agreement by the parties hereto as provided in Section 3.2 of the Loan Agreement, (a) the Joining Lender hereby shall be a party to the Loan Agreement, shall be a Lender under the Loan Agreement having the Loan Commitments set forth in Schedule 1 hereto, effective as of the date of this Joinder Agreement, and shall have the rights and obligations of a Lender under the Loan Agreement and (b) the Maximum Aggregate Loan Amount shall be increased to $155,000,000.00. THIS JOINDER AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. 2 This Joinder Agreement may be executed by one or more of the parties hereto on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. Delivery of an executed signature page hereof by facsimile transmission shall be effective as delivery of a manually executed counterpart hereof. 3 IN WITNESS WHEREOF, the parties hereto have caused this Joinder Agreement to be duly executed and delivered by their proper and duly authorized officers as of this 22nd day of September, 2000. FLEET NATIONAL BANK By:______________________________ Name: Title: Accepted and agreed: GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: _________________________________________ Name: Bernard Freibaum Title: Executive Vice President GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation. its sole general partner By: _____________________________________ Name: Bernard Freibaum Title: Executive Vice President 4 Consented to: BANKERS TRUST COMPANY, as Administrative Agent By:______________________________ Name: Title: LEHMAN COMMERCIAL PAPER INC., as Syndication Agent By:______________________________ Name: Title: Schedule 1 LOAN COMMITMENT AND NOTICE ADDRESSES 1. Name of Lender: Fleet National Bank Notice Address and Domestic Lending Office: One Federal Street Mail Stop - MA_DE10304X Boston, Masschusetts 02110 Attention: Margaret Mulcahy Telephone: 617-346-0996 Facsimile: 617-346-4672 Eurodollar Lending Office: One Federal Street Mail Stop - MA_DE10304X Boston, Masschusetts 02110 Attention: Margaret Mulcahy Telephone: 617-346-0996 Facsimile: 617-346-4672 2. Loan Commitment: $30,000,000.00 Adjusted Pro Rata Share: 19.35% EX-10.(U) 8 dex10u.txt 9/22/00 PROMISSORY NOTE IN FAVOR OF FLEET Exhibit 10(u) NOTE $30,000,000.00 New York, New York September 22,2000 FOR VALUE RECEIVED, the undersigned, GGP LIMITED PARTNERSHIP, a Delaware limited partnership, and GGPLP L.L.C., a Delaware limited liability company (individually and collectively, the "Borrower"), jointly and severally, hereby unconditionally promise to pay to the order of FLEET NATIONAL BANK (the "Lender") at the office of Bankers Trust Company, located at 130 Liberty Street, New York, New York 10006 in lawful money of the United States of America and in immediately available funds, the principal amount of THIRTY MILLION DOLLARS ($30,000,000.00), or, if less, the unpaid principal amount of the Loans made by the Lender pursuant to Section 2.1 or Article III of the Term Loan Agreement, as hereinafter defined. The Borrower further agrees to pay interest in like money at such office on the unpaid principal amount hereof from time to time outstanding at the rates and on the dates specified in Section 5.1 of such Term Loan Agreement. The holder of this Note is authorized to endorse on the schedules annexed hereto and made a part hereof or on a continuation thereof which shall be attached hereto and made a part hereof the date, type and amount of the Loan(s) evidenced hereby and the date and amount of each payment or prepayment of principal with respect thereto, each conversion of all or a portion thereof to another type, each continuation of all or a portion thereof as the same type and, in the case of Eurodollar Rate Loans, the length of each Interest Period with respect thereto. Each such endorsement shall constitute prima facie evidence of the accuracy of the information endorsed. The failure to make any such endorsement shall not affect the obligations of the Borrower in respect of such Loan. This Note (a) is one of the Notes referred to in the Term Loan Agreement dated as of July 31, 2000 (as amended, supplemented or otherwise modified from time to time, the "Term Loan Agreement"), among the Borrower, the Lender, the other institutions from time to time parties thereto as lenders and Bankers Trust Company, as administrative agent, (b) is subject to the provisions of the Term Loan Agreement and (c) is subject to voluntary and mandatory prepayment in whole or in part as provided in the Term Loan Agreement. This Note is guaranteed as provided in the Loan Documents. Reference is made to the Loan Documents for the nature and extent of the guarantees, the terms and conditions upon which each guarantee was granted and the rights of the holder of this Note in respect thereof. Upon the occurrence and during the continuance of any one or more of the Events of Default, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable, all as provided in the Term Loan Agreement. To the extent not prohibited by law, all parties now and hereafter liable with respect to this Note, whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive presentment, demand, protest and all other notices of any kind. 2 Unless otherwise defined herein, terms defined in the Term Loan Agreement and used herein shall have the meanings given to them in the Term Loan Agreement. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN THE TERM LOAN AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND IN ACCORDANCE WITH THE REGISTRATION AND OTHER PROVISIONS OF SECTION 15.1 OF THE TERM LOAN AGREEMENT. THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. [The remainder of this page is intentionally left blank] IN WITNESS WHEREOF, the Borrower has caused this Note to be executed and delivered by its duly authorized officer as of the day and year first above written. GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By:___________________________________ Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By:___________________________________ Name: Bernard Freibaum Title: Executive Vice President Schedule A to Note ------- LOANS, CONVERSIONS AND REPAYMENTS OF BASE RATE LOANS
- ------------------------------------------------------------------------------------------------------------------------------------ Amount Amount of Base Rate Unpaid Principal Amount of Base Converted to Amount of Principal of Loans Converted to Balance of Base Rate Notation Date Rate Loans Base Rate Loans Base Rate Loans Repaid Eurodollar Rate Loans Loans Made By - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------
Schedule B to Note ------- LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR RATE LOANS
- ---------------------------------------------------------------------------------------------------------------------------------- Interest Period Amount of Amount of Eurodollar Unpaid Principal Amount of Amount Converted and Eurodollar Principal of Rate Loans Balance of Eurodollar to Eurodollar Rate with Eurodollar Rate Converted to Eurodollar Notation Date Rate Loans Rate Loans Respect Thereto Loans Repaid Base Rate Loans Rate Loans Made By - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------
EX-10.(V) 9 dex10v.txt 1ST AMENDMENT OT 9/22/00 TERM LOAN AGREEMENT Exhibit 10(v) EXECUTION COPY FIRST AMENDMENT FIRST AMENDMENT, dated as of September 22, 2000 (this "Amendment"), to (a) the Term Loan Agreement, dated as of July 31, 2000 (such Loan Agreement, as amended, supplemented or otherwise modified from time to time, the "Loan Agreement"), among GGP LIMITED PARTNERSHIP, a Delaware limited partnership (the "Partnership"), GGPLP L.L.C., a Delaware limited liability company (together with the Partnership, the "Borrower"), the institutions from time to time parties to the Loan Agreement as Lenders (the "Lenders"), BANKERS TRUST COMPANY, a New York banking corporation, as a Lender and as administrative agent for the Lenders (in such capacity, the "Administrative Agent") and LEHMAN COMMERCIAL PAPER INC., as a Lender and as syndication agent for the Lenders (in such capacity, the "Syndication Agent" and, together with the Administrative Agent, the "Co-Agents") and (b) the Guaranty, dated as of July 31, 2000 (as amended, supplemented or otherwise modified from time to time, the "Guaranty"), by GENERAL GROWTH PROPERTIES, INC., a Delaware corporation ("GGP, Inc."), in favor of the Administrative Agent, for the benefit of the Lenders. W I T N E S S E T H: WHEREAS, pursuant to Section 3.2 of the Loan Agreement and the Joinder, dated as of the date hereof (the "Joinder"), between Fleet National Bank ("Fleet") and the Borrower, Fleet has agreed to become a Lender, and to provide an additional $30,000,000 Loan Commitment, under the Loan Agreement; WHEREAS, in connection with the execution of the Joinder, Fleet has requested that the Borrower, GGP, Inc. and the Lenders agree to amend certain provisions of the Loan Agreement and the Guaranty; WHEREAS, the Borrower, GGP, Inc. and the Lenders are willing to amend such provisions upon the terms and subject to the conditions set forth herein; NOW, THEREFORE, in consideration of the premises and mutual agreements contained herein, and for other valuable consideration the receipt of which is hereby acknowledged, the parties hereto hereby agree as follows: 1. Definitions. All terms defined in the Loan Agreement shall have such defined meanings when used herein unless otherwise defined herein. 2. Amendment to Section 12.11 (Successor Co-Agents). Section 12.11 of the Loan Agreement is hereby amended by adding immediately after the second sentence in such Section the following new sentence: "Upon the gross negligence or willful misconduct of the Administrative Agent in respect of its responsibilities as administrative agent for the Lenders under this Agreement, the Administrative Agent agrees to resign at the request of the Required Lenders." 2 3. Amendment of Section 15.7 (Amendments and Waivers). Section 15.7 of the Loan Agreement is hereby amended by: (a) re-lettering paragraph (d) of such Section as paragraph (e) and (b) adding immediately after paragraph (c) of such Section a new paragraph (d) as follows: "(d) Amendments, Consents and Waivers by Supermajority Lenders. Any amendment, modification, termination, waiver or consent with respect to Section 10.12 of this Agreement shall be effective only by a written agreement, signed by Borrower and Lenders whose Pro Rata Shares, in the aggregate, represent an amount equal to or more than seventy five percent (75%) of the aggregate Pro Rata Shares of all Lenders.". 4. Amendment to Guaranty. Section 2 of the Guaranty is hereby amended by adding immediately after the second sentence in such Section the following new sentence: "To the extent permitted by applicable law, the Guarantor hereby further expressly waives any suretyship defense in respect of the Guaranteed Obligations.". 5. Representations; No Default. On and as of the date hereof, and after giving effect to this Amendment, (i) the Borrower certifies that no Default or Event of Default has occurred or is continuing, and (ii) the Borrower and GGP, Inc., each confirms, reaffirms and restates that the representations and warranties set forth in Article VII of the Loan Agreement and in the other Loan Documents to which it is a party are true and correct in all material respects, provided that the references to the Loan Agreement and the Guaranty therein shall be deemed to be references to this Amendment and to the Loan Agreement and the Guaranty as amended by this Amendment. 6. Conditions to Effectiveness. This Amendment shall become effective on and as of the date that: (a) the Administrative Agent shall have received counterparts of this Amendment, duly executed and delivered by a duly authorized officer of each of the Borrower, GGP, Inc. and the Requisite Lenders; and (b) the Administrative Agent shall have received an executed Acknowledgment and Consent, in the form set forth at the end of this Amendment, from GGP, Inc. 7. Limited Consent and Amendment. Except as expressly amended herein, the Loan Agreement and the Guaranty shall continue to be, and shall remain, in full force and effect. This Amendment shall not be deemed to be a waiver of, or consent to, or a modification or amendment of, any other term or condition of the Loan Agreement, the Guaranty or any other Loan Document or to prejudice any other right or rights which the Co-Agents or the Lenders may now have or may have in the future under or in connection with the Loan Agreement, the Guaranty or any of the instruments or agreements referred to therein, as the same may be amended from time to time. 3 8. Counterparts. This Amendment may be executed by one or more of the parties hereto in any number of separate counterparts and all of said counterparts taken together shall be deemed to constitute one and the same instrument. 9. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed and delivered by their respective duly authorized officers as of the date first above written. GGP LIMITED PARTNERSHIP, as Borrower By: GENERAL GROWTH PROPERTIES, INC., its sole general partner By: _______________________________________ Name: Title: GGPLP L.L.C., as Borrower By: GGP LIMITED PARTNERSHIP, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., its sole general partner By: _______________________________________ Name: Title: GENERAL GROWTH PROPERTIES, INC., as a Guarantor By: _______________________________________ Name: Title: BANKERS TRUST COMPANY, as Administrative Agent and as a Lender By: _______________________________________ Name: Title: LEHMAN COMMERCIAL PAPER INC., as Syndication Agent and as a Lender By: _______________________________________ Name: Title: BAYERISCHE HYPO-UND VEREINSBANK AG, NEW YORK BRANCH, as a Lender By: _______________________________________ Name: Title: FLEET NATIONAL BANK, as a Lender By: _______________________________________ Name: Title: ACKNOWLEDGMENT AND CONSENT The undersigned party to the Guaranty, dated as of July 31, 2000 and as amended, supplemented or otherwise modified from time to time, made by the undersigned in favor of Bankers Trust Company, as Administrative Agent, for the benefit of the Lenders, hereby (a) consents to the transactions contemplated by the foregoing First Amendment and (b) acknowledges and agrees that the guarantees contained in the Guaranty are, and shall remain, in full force and effect after giving effect to such Amendment and all prior modifications to the Loan Agreement. GENERAL GROWTH PROPERTIES, INC. By: _______________________________ Name: Title: EX-10.(W) 10 dex10w.txt LENDER ADDENDUM Exhibit 10(w) LENDER ADDENDUM Reference is made to the Term Loan Agreement, dated as of July 31, 2000 (as amended, supplemented or otherwise modified from time to time, the "Loan Agreement"), among GGP Limited Partnership, GGPLP L.L.C., the institutions from time to time parties thereto as Lenders, Lehman Commercial Paper Inc., as Syndication Agent, and Bankers Trust Company, as Administrative Agent. Unless otherwise defined herein, terms defined in the Loan Agreement and used herein shall have the meanings given to them in the Loan Agreement. Upon execution and delivery of this Lender Addendum by the parties hereto as provided in Section 3.3 of the Loan Agreement, (a) Lehman Commercial Paper Inc. hereby agrees to increase its Loan Commitment under the Loan Agreement as set forth in Schedule 1 hereto, effective as of the date of this Lender Addendum and (b) the Maximum Aggregate Loan Amount shall be increased to $205,000,000.00. THIS LENDER ADDENDUM SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. This Lender Addendum may be executed by one or more of the parties hereto on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. Delivery of an executed signature page hereof by facsimile transmission shall be effective as delivery of a manually executed counterpart hereof. 2 IN WITNESS WHEREOF, the parties hereto have caused this Lender Addendum to be duly executed and delivered by their proper and duly authorized officers as of this 20th day of October, 2000. LEHMAN COMMERCIAL PAPER INC. By:________________________________ Name: Title: Accepted and agreed: GGP LIMITED PARTNERSHIP By: General Growth Properties, Inc., its sole general partner By:______________________________ Name: Bernard Friebaum Title: Executive Vice President GGPLP L.L.C. By: GGP Limited Partnership, its managing member By: General Growth Properties, Inc., its sole general partner By:______________________________ Name: Bernard Friedbaum Title: Executive Vice President BANKERS TRUST COMPANY, as Administrative Agent By:______________________________ Name: Title: 3 LEHMAN COMMERCIAL PAPER INC., as Syndication Agent By:______________________________ Name: Title: Schedule 1 LOAN COMMITMENTS Additional Loan Commitment: $50,000,000.00 Total Loan Commitments: $100,000,000.00 Adjusted Pro Rata Share: 0.4878% EX-10.(X) 11 dex10x.txt 10/20/00 REPLACEMENT NOTE IN FAVOR OF LEHMAN Exhibit 10(x) REPLACEMENT NOTE $100,000,000.00 New York, New York October 20, 2000 FOR VALUE RECEIVED, the undersigned, GGP LIMITED PARTNERSHIP, a Delaware limited partnership, and GGPLP L.L.C., a Delaware limited liability company (individually and collectively, the "Borrower"), jointly and severally, hereby unconditionally promise to pay to the order of LEHMAN COMMERCIAL PAPER INC. (the "Lender") at the office of Bankers Trust Company, located at 130 Liberty Street, New York, New York 10006 in lawful money of the United States of America and in immediately available funds, the principal amount of ONE HUNDRED MILLION DOLLARS ($100,000,000.00), or, if less, the unpaid principal amount of the Loans made by the Lender pursuant to Section 2.1 or Article III of the Term Loan Agreement, as hereinafter defined. The Borrower further agrees to pay interest in like money at such office on the unpaid principal amount hereof from time to time outstanding at the rates and on the dates specified in Section 5.1 of such Term Loan Agreement. The holder of this Note is authorized to endorse on the schedules annexed hereto and made a part hereof or on a continuation thereof which shall be attached hereto and made a part hereof the date, type and amount of the Loan(s) evidenced hereby and the date and amount of each payment or prepayment of principal with respect thereto, each conversion of all or a portion thereof to another type, each continuation of all or a portion thereof as the same type and, in the case of Eurodollar Rate Loans, the length of each Interest Period with respect thereto. Each such endorsement shall constitute prima facie evidence of the accuracy of the information endorsed. The failure to make any such endorsement shall not affect the obligations of the Borrower in respect of such Loan. This Note (a) is one of the Notes referred to in the Term Loan Agreement dated as of July 31, 2000 (as amended, supplemented or otherwise modified from time to time, the "Term Loan Agreement"), among the Borrower, the Lender, the other institutions from time to time parties thereto as lenders and Bankers Trust Company, as administrative agent, and replaces, as of October 20, 2000, that certain Note in the maximum principal amount of $50,000,000.00 made by Borrower to the order of Lender dated July 31, 2000, (b) is subject to the provisions of the Term Loan Agreement and (c) is subject to voluntary and mandatory prepayment in whole or in part as provided in the Term Loan Agreement. This Note is guaranteed as provided in the Loan Documents. Reference is made to the Loan Documents for the nature and extent of the guarantees, the terms and conditions upon which each guarantee was granted and the rights of the holder of this Note in respect thereof. Upon the occurrence and during the continuance of any one or more of the Events of Default, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable, all as provided in the Term Loan Agreement. 2 To the extent not prohibited by law, all parties now and hereafter liable with respect to this Note, whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive presentment, demand, protest and all other notices of any kind. Unless otherwise defined herein, terms defined in the Term Loan Agreement and used herein shall have the meanings given to them in the Term Loan Agreement. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN THE TERM LOAN AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND IN ACCORDANCE WITH THE REGISTRATION AND OTHER PROVISIONS OF SECTION 15.1 OF THE TERM LOAN AGREEMENT. THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. [The remainder of this page is intentionally left blank] IN WITNESS WHEREOF, the Borrower has caused this Note to be executed and delivered by its duly authorized officer as of the day and year first above written. GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By:___________________________________________ Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By:___________________________________________ Name: Bernard Freibaum Title: Executive Vice President Schedule A to Note -------
LOANS, CONVERSIONS AND REPAYMENTS OF BASE RATE LOANS - ------------------------------------------------------------------------------------------------------------------------------- Amount Amount of Base Rate Unpaid Principal Converted to Amount of Principal of Loans Converted to Balance of Base Notation Date Amount of Base Rate Loans Base Rate Loans Base Rate Loans Repaid Eurodollar Rate Loans Rate Loans Made By - ------------------------------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------------------------------------------------
Schedule B to Note
LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR RATE LOANS - ------------------------------------------------------------------------------------------------------------------------------------ Amount of Amount Converted Interest Period and Amount of Principal Amount of Eurodollar Unpaid Principal Eurodollar to Eurodollar Eurodollar Rate with of Eurodollar Rate Rate Loans Converted Balance of Eurodollar Notation Date Rate Loans Rate Loans Respect Thereto Loans Repaid to Base Rate Loans Rate Loans Made By - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------
EX-10.(Y) 12 dex10y.txt 12/28/00 JOINDER AGREEMENT Exhibit 10(y) EXECUTION COPY JOINDER AGREEMENT Reference is made to the Term Loan Agreement, dated as of July 31, 2000 (as amended, supplemented or otherwise modified from time to time, the "Loan Agreement"), among GGP Limited Partnership, GGPLP L.L.C., the institutions from time to time parties thereto as Lenders, Lehman Commercial Paper Inc., as Syndication Agent, and Bankers Trust Company, as Administrative Agent. Unless otherwise defined herein, terms defined in the Loan Agreement and used herein shall have the meanings given to them in the Loan Agreement. The Chase Manhattan Bank (the "Joining Lender") (i) represents and warrants that it is legally authorized to enter into this Joinder Agreement; (ii) confirms that it has received a copy of the Loan Agreement, together with copies of such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Joinder Agreement; (iii) agrees that it will, independently and without reliance upon the Co-Agents or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Agreement; (iv) appoints and authorizes the Co- Agents to take such action as agent on its behalf and to exercise such powers under the Loan Agreement as are delegated to the Co-Agents by the terms thereof, together with such powers as are reasonably incidental thereto and not otherwise reserved under the Loan Agreement; (v) agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Loan Agreement are required to be performed by it from and after the date hereof as a Lender; (vi) confirms that, to the best of its knowledge, as of the date hereof, it has not made any determination which would subject the Borrower to the payment of additional compensation under Section 13.2 or under Section 13.3 of the Loan Agreement; (vii) specifies as its Domestic Lending Office (and address for notices) and Eurodollar Lending Office(s) the offices set forth on Schedule 1 hereto; and (viii) if the Joining Lender is organized under the laws of a jurisdiction outside the United States, attaches the forms prescribed by the Internal Revenue Service of the United States certifying as to the Joining Lender's status for purposes of determining exemption from United States withholding taxes with respect to all payments to be made to the Joining Lender under the Loan Agreement and the Notes or such other documents as are necessary to indicate that all such payments are subject to such taxes at a rate reduced by an applicable tax treaty. Upon execution and delivery of this Joinder Agreement by the parties hereto as provided in Section 3.2 of the Loan Agreement, (a) the Joining Lender hereby shall be a party to the Loan Agreement, shall be a Lender under the Loan Agreement having the Loan Commitments set forth in Schedule 1 hereto, effective as of the date of this Joinder Agreement, and shall have the rights and obligations of a Lender under the Loan Agreement and (b) the Maximum Aggregate Loan Amount shall be increased to $230,000,000.00. THIS JOINDER AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. 2 This Joinder Agreement may be executed by one or more of the parties hereto on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. Delivery of an executed signature page hereof by facsimile transmission shall be effective as delivery of a manually executed counterpart hereof. 3 IN WITNESS WHEREOF, the parties hereto have caused this Joinder Agreement to be duly executed and delivered by their proper and duly authorized officers as of this 28th day of December, 2000. THE CHASE MANHATTAN BANK By:_________________________________ Name: Title: Accepted and agreed: GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: ______________________________ Name: Bernard Freibaum Title: Executive Vice President GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: ______________________________ Name: Bernard Freibaum Title: Executive Vice President 4 Consented to: BANKERS TRUST COMPANY, as Administrative Agent By: ______________________________ Name: Title LEHMAN COMMERCIAL PAPER INC., as Syndication Agent By: ______________________________ Name: Title Schedule 1 LOAN COMMITMENT AND NOTICE ADDRESSES 1. Name of Lender: The Chase Manhattan Bank Notice Address and Domestic Lending Office: 270 Park Avenue New York, New York 10017 Attention: Charles Hoagland Telephone: 212-270-9557 Facsimile: 212-270-3513 Eurodollar Lending Office: 270 Park Avenue New York, New York 10017 Attention: Charles Hoagland Telephone: 212-270-9557 Facsimile: 212-270-3513 2. Loan Commitment: $25,000,000.00 Adjusted Pro Rata Share: 10.87% ADMINISTRATIVE CONTACT 1. Name of Lender: The Chase Manhattan Bank Notice Address: 1 Chase Manhattan Plaza - 8/th/ Floor New York, New York 10081 Attention: Michael Cerniglia Telephone: 212-552-7906 Facsimile: 212-552-5701 EX-10.(Z) 13 dex10z.txt 12/28/00 PROMISSORY NOTE IN FAVOR OF CHASE Exhibit 10(z) NOTE $25,000,000.00 New York, New York December 28, 2000 FOR VALUE RECEIVED, the undersigned, GGP LIMITED PARTNERSHIP, a Delaware limited partnership, and GGPLP L.L.C., a Delaware limited liability company (individually and collectively, the "Borrower"), jointly and severally, hereby unconditionally promise to pay to the order of THE CHASE MANHATTAN BANK (the "Lender") at the office of Bankers Trust Company, located at 130 Liberty Street, New York, New York 10006 in lawful money of the United States of America and in immediately available funds, the principal amount of TWENTY-FIVE MILLION DOLLARS ($25,000,000.00), or, if less, the unpaid principal amount of the Loans made by the Lender pursuant to Section 2.1 or Article III of the Term Loan Agreement, as hereinafter defined. The Borrower further agrees to pay interest in like money at such office on the unpaid principal amount hereof from time to time outstanding at the rates and on the dates specified in Section 5.1 of such Term Loan Agreement. The holder of this Note is authorized to endorse on the schedules annexed hereto and made a part hereof or on a continuation thereof which shall be attached hereto and made a part hereof the date, type and amount of the Loan(s) evidenced hereby and the date and amount of each payment or prepayment of principal with respect thereto, each conversion of all or a portion thereof to another type, each continuation of all or a portion thereof as the same type and, in the case of Eurodollar Rate Loans, the length of each Interest Period with respect thereto. Each such endorsement shall constitute prima facie evidence of the accuracy of the information endorsed. The failure to make any such endorsement shall not affect the obligations of the Borrower in respect of such Loan. This Note (a) is one of the Notes referred to in the Term Loan Agreement dated as of July 31, 2000 (as amended, supplemented or otherwise modified from time to time, the "Term Loan Agreement"), among the Borrower, the Lender, the other institutions from time to time parties thereto as lenders and Bankers Trust Company, as administrative agent, (b) is subject to the provisions of the Term Loan Agreement and (c) is subject to voluntary and mandatory prepayment in whole or in part as provided in the Term Loan Agreement. This Note is guaranteed as provided in the Loan Documents. Reference is made to the Loan Documents for the nature and extent of the guarantees, the terms and conditions upon which each guarantee was granted and the rights of the holder of this Note in respect thereof. Upon the occurrence and during the continuance of any one or more of the Events of Default, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable, all as provided in the Term Loan Agreement. To the extent not prohibited by law, all parties now and hereafter liable with respect to this Note, whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive presentment, demand, protest and all other notices of any kind. Unless otherwise defined herein, terms defined in the Term Loan Agreement and used herein shall have the meanings given to them in the Term Loan Agreement. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN THE TERM LOAN AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND IN ACCORDANCE WITH THE REGISTRATION AND OTHER PROVISIONS OF SECTION 15.1 OF THE TERM LOAN AGREEMENT. THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. [The remainder of this page is intentionally left blank] IN WITNESS WHEREOF, the Borrower has caused this Note to be executed and delivered by its duly authorized officer as of the day and year first above written. GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: _________________________________ Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: ____________________________________ Name: Bernard Freibaum Title: Executive Vice President Schedule A to Note ------- LOANS, CONVERSIONS AND REPAYMENTS OF BASE RATE LOANS
- ------------------------------------------------------------------------------------------------------------------------------------ Amount Amount of Base Rate Unpaid Principal Converted to Amount of Principal of Loans Converted to Balance of Base Rate Notation Date Amount of Base Rate Loans Base Rate Loans Base Rate Loans Repaid Eurodollar Rate Loans Loans Made By - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------
Schedule B to Note ------- LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR RATE LOANS
- ------------------------------------------------------------------------------------------------------------------------------------ Interest Period and Amount of Principal Amount of Eurodollar Unpaid Principal Amount of Amount Converted Eurodollar Rate of Eurodollar Rate Loans Balance of Eurodollar to Eurodollar with Rate Converted to Base Eurodollar Notation Date Rate loans Rate Loans Respect Thereto Loans Repaid Rate Loans Rate Loans Made By - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------
EX-10.(AA) 14 dex10aa.txt 2ND AMENDMENT TO 12/28/00 TERM LOAN AGREEMENT Exhibit 10(aa) EXECUTION COPY SECOND AMENDMENT SECOND AMENDMENT, dated as of December 28, 2000 (this "Amendment"), to the Term Loan Agreement, dated as of July 31, 2000 (such Loan Agreement, as amended, supplemented or otherwise modified from time to time, the "Loan Agreement"), among GGP LIMITED PARTNERSHIP, a Delaware limited partnership (the "Partnership"), GGPLP L.L.C., a Delaware limited liability company (together with the Partnership, the "Borrower"), the institutions from time to time parties to the Loan Agreement as Lenders (the "Lenders"), BANKERS TRUST COMPANY, a New York banking corporation, as a Lender and as administrative agent for the Lenders (in such capacity, the "Administrative Agent") and LEHMAN COMMERCIAL PAPER INC., as a Lender and as syndication agent for the Lenders (in such capacity, the "Syndication Agent" and, together with the Administrative Agent, the "Co-Agents"). W I T N E S S E T H: WHEREAS, pursuant to Section 3.2 of the Loan Agreement and the Joinder, dated as of the date hereof (the "Joinder"), between The Chase Manhattan Bank ("Chase") and the Borrower, Chase has agreed to become a Lender, and to provide an additional $25,000,000 Loan Commitment, under the Loan Agreement; WHEREAS, in connection with the execution of the Joinder, Chase has requested that the Borrower and the Lenders agree to amend certain provisions of the Loan Agreement; WHEREAS, the Borrower and the Lenders are willing to amend such provisions upon the terms and subject to the conditions set forth herein; NOW, THEREFORE, in consideration of the premises and mutual agreements contained herein, and for other valuable consideration the receipt of which is hereby acknowledged, the parties hereto hereby agree as follows: 1. Definitions. All terms defined in the Loan Agreement shall have such defined meanings when used herein unless otherwise defined herein. 2. Amendment to Section 1.1 (Certain Defined Terms). Section 1.1 of the Loan Agreement is hereby amended by replacing the phrase "which is a party hereto as a Lender" in the definition of "Lender" in such Section with the phrase "which is or hereafter becomes a party hereto as a Lender". 3. Amendment to Section 5.3(a) (Agency Fee) Section 5.3(a) of the Loan Agreement is hereby amended by replacing the reference to "$40,000" in such Section with the following: "$50,000, plus an additional $5,000 for each Lender in excess of three". 4. Amendment to Section 12.2 (Powers). Section 12.2 of the Loan Agreement is hereby amended by adding immediately after paragraph (c) in such Section a new paragraph (d) as follows: 2 "(d) Notwithstanding anything to the contrary contained in this Section, each Lender shall be permitted to initiate any appropriate judicial action against the Borrower to collect payment in respect of such Lender's Note if, 180 days shall have elapsed after an Event of Default under Section 11.1(a) has occurred and is continuing, the Administrative Agent is not diligently pursuing enforcement of the Debt pursuant to Section 11.2 and the Lenders have not agreed in accordance with the applicable requirements of Section 15.7 to a waiver or consent under, or amendment or other modification to, this Agreement to waive, or otherwise provide for an amendment or modification in respect of, such Event of Default.". 5. Amendment to Section 15.1 (Assignments and Participations). Section 15.1 of the Credit Agreement is hereby amended by replacing each reference to "Co-Agent" and "Co-Agents" in paragraph (f) in such Section with a reference to "Lender" and "Lenders", as applicable. 6. Representations; No Default. On and as of the date hereof, and after giving effect to this Amendment, (i) the Borrower certifies that no Default or Event of Default has occurred or is continuing, and (ii) the Borrower confirms, reaffirms and restates that the representations and warranties set forth in Article VII of the Loan Agreement and in the other Loan Documents to which it is a party are true and correct in all material respects, provided that the references to the Loan Agreement therein shall be deemed to be references to this Amendment and to the Loan Agreement as amended by this Amendment. 7. Conditions to Effectiveness. This Amendment shall become effective on and as of the date that: (a) the Administrative Agent shall have received counterparts of this Amendment, duly executed and delivered by a duly authorized officer of the Borrower and the Requisite Lenders; and (b) the Administrative Agent shall have received an executed Acknowledgment and Consent, in the form set forth at the end of this Amendment, from GGP, Inc. 8. Limited Consent and Amendment. Except as expressly amended herein, the Loan Agreement shall continue to be, and shall remain, in full force and effect. This Amendment shall not be deemed to be a waiver of, or consent to, or a modification or amendment of, any other term or condition of the Loan Agreement or any other Loan Document or to prejudice any other right or rights which the Co-Agents or the Lenders may now have or may have in the future under or in connection with the Loan Agreement or any of the instruments or agreements referred to therein, as the same may be amended from time to time. 9. Counterparts. This Amendment may be executed by one or more of the parties hereto in any number of separate counterparts and all of said counterparts taken together shall be deemed to constitute one and the same instrument. 3 10. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed and delivered by their respective duly authorized officers as of the date first above written. GGP LIMITED PARTNERSHIP, as Borrower By: GENERAL GROWTH PROPERTIES, INC., its sole general partner By: ______________________________________ Name: Title: GGPLP L.L.C., as Borrower By: GGP LIMITED PARTNERSHIP, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., its sole general partner By: ______________________________________ Name: Title: BANKERS TRUST COMPANY, as Administrative Agent and as a Lender By: ______________________________________ Name: Title: LEHMAN COMMERCIAL PAPER INC., as Syndication Agent and as a Lender By: ______________________________________ Name: Title: BAYERISCHE HYPO-UND VEREINSBANK AG, NEW YORK BRANCH, as a Lender By: ______________________________________ Name: Title: FLEET NATIONAL BANK, as a Lender By: ______________________________________ Name: Title: THE CHASE MANHATTAN BANK, as a Lender By: ______________________________________ Name: Title: ACKNOWLEDGMENT AND CONSENT The undersigned party to the Guaranty, dated as of July 31, 2000 and as amended, supplemented or otherwise modified from time to time, made by the undersigned in favor of Bankers Trust Company, as Administrative Agent, for the benefit of the Lenders, hereby (a) consents to the transactions contemplated by the foregoing Second Amendment and (b) acknowledges and agrees that the guarantees contained in the Guaranty are, and shall remain, in full force and effect after giving effect to such Amendment and all prior modifications to the Loan Agreement. GENERAL GROWTH PROPERTIES, INC. By: ______________________________ Name: Title: EX-10.(BB) 15 dex10bb.txt 7/31/00 REVOLVING CREDIT AGREEMENT Exhibit 10(bb) REVOLVING CREDIT AGREEMENT This REVOLVING CREDIT AGREEMENT dated as of July 31, 2000 (as the same may be amended, supplemented or modified from time to time, the "Agreement") is entered into among GGP LIMITED PARTNERSHIP, a Delaware limited partnership (the "Partnership"), GGPLP L.L.C., a Delaware limited liability company (the "Company;" the Partnership and the Company being referred to herein, individually and collectively, as the "Borrower"), the institutions from time to time parties hereto as Lenders, BANK OF AMERICA, N.A., a national banking association ("Bank of America"), as a Lender and as administrative agent ("Administration Agent") for the Lenders, U.S. BANK NATIONAL ASSOCIATION, a national banking association ("USB"), as a Lender and as the syndication agent ("Syndication Agent") for the Lenders, and DRESDNER BANK AG, New York and Grand Cayman Branches ("Dresdner"), as a Lender and as the documentation agent ("Documentation Agent") for the Lenders (the Administrative Agent, the Documentation Agent and the Syndication Agent being referred to herein collectively as the "Co-Arrangers"). The parties hereto agree as follows: ARTICLE I - DEFINITIONS 1.1 Certain Defined Terms. The following terms used in this Agreement shall have the following meanings, applicable both to the singular and the plural forms of the terms defined: "Addendum" is defined in Section 3.3 hereof. "Adjusted EBITDA" means, with respect to any Property, for any period, an amount equal to (i) total revenues relating to such Property for such period, less (ii) the sum of total operating expenses relating to such Property for such - ---- period determined in accordance with GAAP (excluding any such expenses funded from the Capital Improvement Reserve) and the Capital Improvement Reserve for such period, plus (iii) to the extent subtracted pursuant to clause (ii) above, interest, income taxes (but not real estate taxes), depreciation, amortization and other non-cash charges determined in accordance with GAAP, which amount shall be adjusted for nonrecurring items such as sales of Properties or Minority Holdings and to eliminate the straight-lining of rents; provided, however, that for each Property which has been owned by Borrower, a Consolidated Business or a Minority Holding or open for business for a period of less than one quarter, Adjusted EBITDA shall be calculated on a pro forma basis based on actual results for such partial quarter. Adjusted EBITDA shall be determined by reference to the Borrower's statement of operations for the applicable period. Notwithstanding anything to the contrary contained herein, (1) Adjusted EBITDA shall not include any revenues generated by or allocable to any Property to the extent that the Investment in such Property constitutes an Event of Default or Potential Event of Default under Section 10.11 hereof; (2) Adjusted EBITDA shall not include any revenues generated by or allocable to any Real Estate Under Construction with respect to which the Borrower elects to include Construction Asset Cost in Capitalization Value; provided, however, that such revenues may be included to the extent that (A) the construction in question constitutes renovation or expansion of a Property that is otherwise completed, open for business and operational, (B) the construction in question will not materially interrupt, limit or impair such ongoing business and operations, and (C) the inclusion of both such revenues in Adjusted EBITDA and such Construction Asset Cost in Capitalization Value is not duplicative; and (3) the Building located at 110 North Wacker Drive, Chicago, Illinois is not a Property for the purposes of this definition. "Administrative Agent" is defined in the preamble and includes Bank of America in its capacity as administrative agent for the Lenders and each successor administrative agent appointed in accordance with the terms of this Agreement "Affiliate", as applied to any Person, means any other Person that directly or indirectly controls, is controlled by, or is under common control with, that Person. For purposes of this definition, "control" (including, with correlative meanings, the terms "controlling", "controlled by" and "under common control with"), as applied to any Person, means the possession, directly or indirectly, of the power to vote fifteen percent (15.0%) or more of the equity Securities having voting power for the election of directors of such Person or otherwise to direct or cause the direction of the management and policies of that Person, whether through the ownership of voting equity Securities or by contract or otherwise. "Annual EBITDA" means, with respect to any Property as of the first day of any calendar quarter: (i) for purposes of determining the Applicable Margin, the Facility Fee Percentage and the financial ratios described in Section 10.12(b) and (e) hereof, Adjusted EBITDA for the immediately preceding consecutive four calendar quarters; provided, however, that for each Property which has been owned by Borrower, a Consolidated Business or a Minority Holding or open for business for a period of less than one year, Annual EBITDA shall be calculated on the basis of Adjusted EBITDA determined as of the first day of each calendar quarter for such period or the immediately preceding consecutive one, two or three calendar quarters, as applicable with respect to the length of such ownership, for the period of Borrower's ownership or since opening, annualized; and (ii) for all other purposes of this Agreement, the sum of (x) Adjusted EBITDA for the immediately preceding calendar quarter determined without regard to any percentage rent or temporary rent, annualized, plus (y) percentage rent and temporary rent for the immediately preceding consecutive four calendar quarters, adjusted for any Properties or Minority Holdings acquired, opened or sold during that period. Examples of the foregoing calculations are set forth on Exhibit G hereto. The Building located at 110 North Wacker Drive, Chicago, Illinois is not a Property for the purposes of this definition. "Applicable Lending Office" means, with respect to a particular Lender, (i) its Eurodollar Lending Office in respect of provisions relating to Eurodollar Rate Loans, and (ii) its Domestic Lending Office in respect of provisions relating to Base Rate Loans. "Applicable Margin" means, with respect to each Loan, the respective percentages per annum determined, at any time, based on the range into which the Leverage Ratio then falls, in accordance with the following table. Any change in the Applicable Margin shall be effective as of the applicable financial reporting date set forth in Section 8.2 hereof (exclusive of Section 8.2(b)(iv) hereof), and as of the date of the consummation and funding of each Capital Event. 2 Applicable Margin (% per annum) ------------------------------- Eurodollar Base Leverage Ratio Rate Loans Rate Loans - -------------- ---------- ---------- less than 45% 1.00% 0.00% 45% to less than 50% 1.25% 0.00% 50% to less than 55% 1.40% 0.00% 55% to less than 60% 1.65% 0.00% 60% or greater 1.90% 0.00% "Assignment and Acceptance" means an Assignment and Acceptance in substantially the form of Exhibit A attached hereto and made a part hereof (with blanks appropriately completed) delivered to the Administrative Agent in connection with an assignment of a Lender's interest under this Agreement in accordance with the provisions of Section 15.1. "Authorized Financial Officer" means a chief executive officer, chief financial officer, treasurer or other qualified senior officer acceptable to the Administrative Agent. "Bank of America" is defined in the preamble to this Agreement. "Base Eurodollar Rate" means, with respect to any Eurodollar Interest Period applicable to a Borrowing of Eurodollar Rate Loans, an interest rate per annum displayed on the Rate Page for the purpose of displaying interest rates at which U.S. Dollar deposits are offered by major banks in the London interbank market as of 11:00 a.m., London time, on the applicable Eurodollar Interest Rate Determination Date, for deposits in Dollars, in immediately available funds, in an amount comparable to the amount of the applicable Eurodollar Rate Loan on such date, and for a duration comparable to the applicable Eurodollar Interest Period; provided, however, that if such rate does not appear on the Rate Page, the "Base Eurodollar Rate" applicable to a particular Eurodollar Interest Period shall mean a rate per annum equal to the rate at which U.S. Dollar deposits in an amount approximately equal to the principal balance (or the portion thereof which will bear interest at a rate determined by reference to the Base Eurodollar Rate during the Interest Period to which such Base Eurodollar Rate is applicable in accordance with the provisions hereof), and with maturities comparable to the last day of the Eurodollar Interest Period with respect to which such Base Eurodollar Rate is applicable, are offered in immediately available funds in the London Interbank Market to the London office of Bank of America by leading banks in the Eurodollar market at 11:00 a.m., London time, on the applicable Eurodollar Interest Rate Determination Date. "Base Rate" means, for any period, a fluctuating interest rate per annum as shall be in effect from time to time, which rate per annum shall at all times be equal to the higher of: 3 (i) the rate of interest announced publicly by Bank of America, from time to time, as Bank of America's reference rate; and (ii) the sum of (A) one-half of one percent (0.50%) per annum plus (B) the Federal Funds Rate in effect from time to time during such period.. "Base Rate Loan" means (i) a Loan which bears interest at the Base Rate, or (ii) an overdue amount which was a Base Rate Loan immediately before it became due. "Benefit Plan" means a "defined benefit plan" as defined in Section 3(35) of ERISA and any other "pension plan" as defined in Section 3(2) of ERISA subject to Section 302 of ERISA (other than a Multiemployer Plan) in respect of which the Borrower or any ERISA Affiliate is, or within the immediately preceding six (6) years was, an "employer" as defined in Section 3(5) of ERISA or in respect of which the Borrower or any ERISA Affiliate has assumed any liability. "Borrower" is defined in the preamble to this Agreement. "Borrower Operating Agreement" means the Amended and Restated Operating Agreement of the Company dated May 25, 2000, as such agreement may be amended, restated, modified or supplemented from time to time with the consent of the Administrative Agent or as permitted under Section 10.8. "Borrower Partnership Agreement" means the Second Amended and Restated Agreement of Limited Partnership of the Partnership dated April 1, 1998, as amended by First Amendment dated as of June 10, 1998 and Second Amendment dated as of June 29, 1998, and as supplemented by joinders of certain third parties as limited partners in the Partnership, as such agreement may be amended, restated, modified or supplemented from time to time with the consent of the Administrative Agent or as permitted under Section 10.8. "Borrowing" means a borrowing consisting of Loans of the same type made, continued or converted on the same day. "Business Day" means a day, in the applicable local time, which is not a Saturday or Sunday or a legal holiday and on which banks are not required or permitted by law or other governmental action to close (i) in Chicago, Illinois, and (ii) in the case of Eurodollar Rate Loans, in London, England. "Capital Event" means any sale or issuance (or series of related sales or issuances) by GGP,Inc., the Borrower or any of its Subsidiaries, of: (i) equity Securities representing interests in such entity that generates net proceeds in excess of $50,000,000; or (ii) debt Securities representing obligations of such entity (including, without limitation, any secured or unsecured financing or refinancing) that generates net proceeds in excess of $75,000,000. "Capital Expenditures" means, for any period, the aggregate of all expenditures (whether payable in cash or other Property or accrued as a liability (but without duplication)) during such period that, in conformity with GAAP, are required to be included in or reflected by the Borrower's or any of its Subsidiaries' fixed asset accounts as reflected in any of their respective 4 balance sheets; provided, however, (i) Capital Expenditures shall include, whether or not such a designation would be in conformity with GAAP, (a) that portion of Capital Leases which is capitalized on the Consolidated balance sheet of the Borrower and its Subsidiaries and (b) expenditures for Equipment which is purchased simultaneously with the trade-in of existing Equipment owned by the Borrower or any of its Subsidiaries, to the extent the gross purchase price of the purchased Equipment exceeds the book value of the Equipment being traded in at such time; and (ii) Capital Expenditures shall exclude, whether or not such a designation would be in conformity with GAAP, expenditures made in connection with the restoration of Property, to the extent reimbursed or financed from insurance or condemnation proceeds. Notwithstanding the foregoing, Capital Expenditures shall not include Construction Asset Cost or costs associated with the renovation of an individual Property in excess of $5,000,000. "Capital Improvement Reserve" means $0.25 per annum per square foot of mall store gross leasable area in Real Property, and in that portion of real property owned by Minority Holdings allocable, on a pro rata basis, to the Borrower or any of its Subsidiaries. "Capitalization Value" means the sum of (i) the Combined EBITDA for the applicable period divided by 8.25%, and (ii) Cash and Cash Equivalents, and (iii) Inactive Assets, other than Construction Assets, at the lesser of cost or fair market value; and (iv) Construction Asset Cost; provided, however, that Capitalization Value shall include Inactive Assets and Construction Asset Cost only to the extent that Inactive Assets and Construction Asset Cost do not exceed, in the aggregate, eight percent (8%) of Capitalization Value; and provided further that for purposes of determining Capitalization Value only, "Construction Asset Cost" shall mean, with respect to the land portion of the Construction Assets set forth on Schedule 1, instead of acquisition cost, the values of the land portion of such Construction Assets as set forth on such Schedule 1; and provided further that Capitalization Value shall not include any Inactive Asset or Construction Asset Cost incurred with respect to any Construction Asset to the extent the incurrence of such Construction Asset Cost or the Investment in such Inactive Asset or Construction Asset constitutes an Event of Default or Potential Event of Default under Section 10.11 hereof; and provided further that Capitalization Value shall not include Construction Asset Cost as to any Real Estate Under Construction with respect to which the Borrower elects to include revenues in Adjusted EBITDA; provided, however, that such Construction Asset Cost may be included to the extent that (A) the construction in question constitutes renovation or expansion of a Property that is otherwise completed, open for business and operational, (B) the construction in question will not materially interrupt, limit or impair such ongoing business and operations, and (C) the inclusion of both such revenues in Adjusted EBITDA and such Construction Asset Cost in Capitalization Value is not duplicative. "Capital Lease" means any lease of any property (whether real, personal or mixed) by a Person as lessee which, in conformity with GAAP, is accounted for as a capital lease on the balance sheet of that Person. "Capital Stock" means, with respect to any Person, any capital stock of such Person, regardless of class or designation, and all warrants, options, purchase rights, conversion or exchange rights, voting rights, calls or claims of any character with respect thereto. 5 "Cash and Cash Equivalents" means (i) unrestricted cash, (ii) unrestricted marketable direct obligations issued or unconditionally guaranteed by the United States government and backed by the full faith and credit of the United States government; and (iii) unrestricted domestic and Eurodollar certificates of deposit and time deposits, bankers' acceptances and floating rate certificates of deposit issued by any commercial bank organized under the laws of the United States, any state thereof, the District of Columbia, any foreign bank, or its branches or agencies (fully protected against currency fluctuations), which, at the time of acquisition, are rated A1 (or better) by S&P or P1 (or better) by Moody's; provided, however, that the maturities of such Cash and Cash Equivalents shall not exceed one year. "CERCLA" means the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. (S)(S) 9601 et seq., any amendments thereto, any successor statutes, and any regulations or guidance having the force of law promulgated thereunder. "Change of Control" means that (i) more than two of Matthew Bucksbaum, John Bucksbaum, Robert Michaels, Bernard Freibaum and Jon Batesole, or any replacement for any of the foregoing Persons approved by the Requisite Lenders pursuant to clause (ii) below, cease to be senior officers of GGP, Inc., and (ii) if the circumstances described in clause (i) shall occur, the senior management positions of the foregoing Persons who cease to be senior officers as aforesaid are not filled within 180 days after the vacancy in such positions arise with replacements approved by the Requisite Lenders. "Claim" means any claim or demand, by any Person, of whatsoever kind or nature for any alleged Liabilities and Costs, whether based in contract, tort, implied or express warranty, strict liability, criminal or civil statute, Permit, ordinance or regulation, common law or otherwise. "Closing Date" means July 31, 2000. "Co-Arrangers" is defined in the preamble to this Agreement. "Combined EBITDA" means the sum of (i) 100% of the Annual EBITDA of the Borrower and its wholly-owned Subsidiaries with respect to Properties wholly- owned by the Borrower or any such Subsidiary; and (ii) the portion of the Annual EBITDA of the Minority Holdings allocable to the Borrower and the Management Company in accordance with GAAP; provided, however, that Combined EBITDA shall include Annual EBITDA allocable to the Management Company only to the extent that Annual EBITDA allocable to the Management Company does not exceed four percent (4%) of Combined EBITDA. "Combined Equity Value" means Capitalization Value minus Total Adjusted Outstanding Indebtedness. "Combined Interest Expense" means, for any period, the sum of (i) interest expense of GGP, Inc. and the Consolidated Businesses paid during such period and (ii) interest expense of GGP, Inc. and the Consolidated Businesses accrued for such period to the extent not paid during such period, and (iii) the portion of the interest expense of Minority Holdings allocable to GGP, Inc. or the Borrower in accordance with GAAP and paid during such period, and (iv) the portion 6 of the interest expense of Minority Holdings allocable to the Borrower in accordance with GAAP and accrued for such period, to the extent not paid during such period, in each case including participating interest expense, but excluding extraordinary interest expense and prepayment fees, premiums or penalties and net of amortization of deferred costs associated with new financings or refinancings of existing Indebtedness; provided, however, that with respect to Properties that GGP, Inc., the Borrower, a Consolidated Business or a Minority Holding has owned for less than one year and which is included in the calculation of Annual EBITDA, the interest expense with respect thereto (incurred in connection with any Loans made in connection with the acquisition of such Property or in connection with any mortgage loans entered into or assumed in connection therewith) shall be determined as of the first day of each fiscal quarter for the immediately preceding consecutive one, two or three fiscal quarters, as applicable with respect to the period such Property has been owned by the Borrower, a Consolidated Business or a Minority Holding, annualized. "Commission" means the Securities and Exchange Commission and any Person succeeding to the functions thereof. "Compliance Certificate" is defined in Section 8.2(b). "Consolidated" means consolidated in accordance with GAAP. "Consolidated Businesses" means the Borrower and its respective wholly- owned Subsidiaries. "Construction Asset" means any Property which is raw land, vacant out- parcels or Real Estate Under Construction. "Construction Asset Cost" means, with respect to all Construction Assets, the aggregate sums expended on the construction of such improvements (including land acquisition costs). "Contaminant" means any waste, pollutant, hazardous substance, toxic substance, hazardous waste, special waste, petroleum or petroleum-derived substance or waste, radioactive materials, asbestos (in any form or condition), polychlorinated biphenyls (PCBs), or any constituent of any such substance or waste, and includes, but is not limited to, these terms as defined in federal, state or local laws or regulations; provided however that "Contaminant" shall not include the foregoing items to the extent (i) the same exist on the applicable Property in negligible or customary amounts and are stored and used in accordance with all Environmental, Health or Safety Requirements of Law or (ii) are used in connection with a tire or battery retail store provided the same are stored, sold and used in accordance with all Environmental, Health or Safety Requirements of Law. "Contingent Obligation" as to any Person means, without duplication, (i) any contingent obligation of such Person required to be shown on such Person's balance sheet in accordance with GAAP, and (ii) any obligation required to be disclosed in the footnotes to such Person's financial statements in accordance with GAAP, guaranteeing partially or in whole any Non-Recourse Indebtedness, lease, dividend or other obligation, exclusive of (A) contractual 7 indemnities (including, without limitation, any indemnity or price-adjustment provision relating to the purchase or sale of Securities or other assets) and (B) guarantees of non-monetary obligations (other than guarantees of completion) which have not yet been called on or quantified, of such Person or of any other Person. The amount of any Contingent Obligation described in clause (ii) shall be deemed to be (a) with respect to a guaranty of interest or interest and principal, or operating income guaranty, the sum of all payments required to be made thereunder (which in the case of an operating income guaranty shall be deemed to be equal to the debt service for the note secured thereby), calculated at the interest rate applicable to such Indebtedness, through (i) in the case of an interest or interest and principal guaranty, the stated date of maturity of the obligation (and commencing on the date interest could first be payable thereunder), or (ii) in the case of an operating income guaranty, the date through which such guaranty will remain in effect, and (b) with respect to all guarantees not covered by the preceding clause (a) an amount equal to the stated or determinable amount of the primary obligation in respect of which such guaranty is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder) as recorded on the balance sheet and on the footnotes to the most recent financial statements of the applicable Borrower required to be delivered pursuant hereto. Notwithstanding anything contained herein to the contrary, guarantees of completion or other performance shall not be deemed to be Contingent Obligations unless and until a claim for payment has been made thereunder, at which time any such guaranty of completion or other performance shall be deemed to be a Contingent Obligation in an amount equal to any such claim. Subject to the preceding sentence, (i) in the case of a joint and several guaranty given by such Person and another Person (but only to the extent such guaranty is Recourse Indebtedness, directly or indirectly to the applicable Borrower), the amount of the guaranty shall be deemed to be 100% thereof unless and only to the extent that (X) such other Person has delivered Cash or Cash Equivalents to secure all or any part of such Person's obligations under such joint and several guaranty or (Y) such other Person holds an Investment Grade Credit Rating from either Moody's or S&P or has creditworthiness otherwise reasonably acceptable to the Administrative Agent, and (ii) in the case of a guaranty (whether or not joint and several) of an obligation otherwise constituting Indebtedness of such Person, the amount of such guaranty shall be deemed to be only that amount in excess of the amount of the obligation constituting Indebtedness of such Person. Notwithstanding anything contained herein to the contrary, "Contingent Obligations" shall not be deemed to include guarantees of loan commitments or of construction loans to the extent the same have not been drawn. "Contractual Obligation" means, as applied to any Person, any provision of any Securities issued by that Person or any Organizational Document, indenture, mortgage, deed of trust, security agreement, pledge agreement, guaranty, contract, undertaking, agreement or instrument to which that Person is a party or by which it or any of its properties is bound, or to which it or any of its properties is subject. "Credit Rating" means the publicly announced rating of a Person given by Moody's or S&P. "Cure Loans" is defined in Section 4.2(b)(v)(C). 8 "Customary Permitted Liens" means (a) Liens (other than Environmental Liens and Liens in favor of the PBGC) with respect to the payment of taxes, assessments or utility or governmental charges in all cases which are not yet due or which are being contested in good faith by appropriate proceedings in accordance with Section 9.4 and with respect to which adequate reserves or other appropriate provisions are being maintained in accordance with GAAP; (b) Statutory Liens of landlords or Equipment lessors against any Property of the Borrower or any of its Subsidiaries and Liens against any Property of the Borrower or any of its Subsidiaries in favor of suppliers, mechanics, carriers, materialmen, warehousemen or workmen and other Liens against any Property of the Borrower or any of its Subsidiaries imposed by law created in the ordinary course of business for amounts which, if not resolved in favor of the Borrower or such Subsidiary, would not be likely to result in a Material Adverse Effect; (c) Liens (other than any Lien in favor of the PBGC) incurred or deposits made in the ordinary course of business in connection with worker's compensation, unemployment insurance or other types of social security benefits or to secure the performance of bids, tenders, sales, contracts (other than for the repayment of borrowed money), surety, appeal and performance bonds; provided that (A) all such Liens do not in the aggregate materially detract from the value of the Borrower's (if such Liens are against Property of Borrower) or a Subsidiary's assets or Property or materially impair the use thereof in the operation of their respective businesses, and (B) all Liens of attachment or judgment and Liens securing bonds to stay judgments or in connection with appeals do not secure at any time an aggregate amount of Recourse Indebtedness exceeding $5,000,000 with respect to the Borrower and its Subsidiaries; and (d) Liens against any Property of the Borrower or any Subsidiary of the Borrower arising with respect to zoning restrictions, easements, operating agreements, licenses, reservations, covenants, rights-of-way, utility easements, building restrictions and other similar charges or encumbrances on the use of Real Property which do not interfere with the ordinary conduct of the business of the Borrower or any of its Subsidiaries or materially affect the value thereof or, taken together, to the extent they would not be likely to result in a Material Adverse Effect. "Documentation Agent" is defined in the preamble to this Agreement and includes Dresdner in its capacity as documentation agent for the Lenders and each successor documentation agent appointed in accordance with the terms of this Agreement. "DOL" means the United States Department of Labor and any Person succeeding to the functions thereof. "Dollars" and "$" mean the lawful money of the United States. 9 "Domestic Lending Office" means, with respect to any Lender, such Lender's office, located in the United States, specified as the "Domestic Lending Office" under its name on the signature pages hereof or on the Assignment and Acceptance or the Joinder Agreement by which it became a Lender or such other United States office of such Lender as it may from time to time specify by written notice to the Borrower and the Administrative Agent. "Dresdner" is defined in the preamble to this Agreement. "Eligible Assignee" means (i) a Lender or any Affiliate thereof; (ii) a commercial bank having total assets in excess of $5,000,000,000; (iii) the central bank of any country which is a member of the Organization for Economic Cooperation and Development; or (iv) a finance company or other financial institution reasonably acceptable to the Administrative Agent, which is regularly engaged in making, purchasing or investing in loans and having total assets in excess of $500,000,000 or is otherwise acceptable to the Administrative Agent and in each case (other than (i) above) reasonably acceptable to the Borrower. "Environmental, Health or Safety Requirements of Law" means all Requirements of Law derived from or relating to any federal, state or local law, ordinance, rule, regulation, Permit, license or other binding determination of any Governmental Authority relating to, imposing liability or standards concerning, or otherwise addressing the environment, health and/or safety, including, but not limited to the Clean Air Act, the Clean Water Act, CERCLA, RCRA, any so-called "Superfund" or "Superlien" law, the Toxic Substances Control Act and OSHA, and public health codes, each as from time to time in effect, in each case as applicable to the Borrower or its Property. "Environmental Lien" means a Lien in favor of any Governmental Authority for any (i) liabilities under any Environmental, Health or Safety Requirement of Law, or (ii) damages arising from, or costs incurred by such Governmental Authority in response to, a Release or threatened Release of a Contaminant into the environment. "Environmental Property Transfer Act" means any applicable Requirement of Law that conditions, restricts, prohibits or requires any notification or disclosure triggered by the transfer, sale, lease or closure of any Property or deed or title for any Property for environmental reasons, including, but not limited to, any so-called "Environmental Cleanup Responsibility Act" or "Responsible Property Transfer Act". "Equipment" means equipment which is personal property used in connection with the maintenance of any Property. "ERISA" means the Employee Retirement Income Security Act of 1974, 29 U.S.C. (S)(S) 1000 et seq., any amendments thereto, any successor statutes, and any regulations or guidance having the force of law promulgated thereunder. "ERISA Affiliate" means (i) any corporation which is a member of the same controlled group of corporations (within the meaning of Section 414(b) of the Internal Revenue Code) as the Borrower; (ii) a partnership or other trade or business (whether or not incorporated) which is 10 under common control (within the meaning of Section 414(c) of the Internal Revenue Code) with the Borrower; and (iii) a member of the same affiliated service group (within the meaning of Section 414(m) of the Internal Revenue Code) as the Borrower, any corporation described in clause (i) above or any partnership or trade or business described in clause (ii) above. "ERISA Termination Event" means (i) a Reportable Event with respect to any Benefit Plan; (ii) the withdrawal of the Borrower or any ERISA Affiliate from a Benefit Plan during a plan year in which the Borrower or such ERISA Affiliate was a "substantial employer" as defined in Section 4001(a)(2) of ERISA or the cessation of operations which results in the termination of employment of 20% of Benefit Plan participants who are employees of the Borrower or any ERISA Affiliate; (iii) the imposition of an obligation on the Borrower or any ERISA Affiliate under Section 4041 of ERISA to provide affected parties written notice of intent to terminate a Benefit Plan in a distress termination described in Section 4041(c) of ERISA; (iv) the institution by the PBGC of proceedings to terminate a Benefit Plan; (v) any event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Benefit Plan; or (vi) the partial or complete withdrawal of the Borrower or any ERISA Affiliate from a Multiemployer Plan. "Eurodollar Affiliate" means, with respect to each Lender, the Affiliate of such Lender (if any) set forth below such Lender's name under the heading "Eurodollar Affiliate" on the signature pages hereof or on the Assignment and Acceptance or Joinder Agreement by which it became a Lender or such Affiliate of a Lender as it may from time to time specify by written notice to the Borrower and the Administrative Agent. "Eurodollar Interest Period" is defined in Section 5.2(b). "Eurodollar Interest Rate Determination Date" is defined in Section 5.2(c). "Eurodollar Lending Office" means, with respect to any Lender, such Lender's office (if any) specified as the "Eurodollar Lending Office" under its name on the signature pages hereof or on the Assignment and Acceptance or Joinder Agreement by which it became a Lender or such other office or offices of such Lender as it may from time to time specify by written notice to the Borrower and the Administrative Agent. "Eurodollar Rate" means, with respect to any Eurodollar Interest Period applicable to a Eurodollar Rate Loan, an interest rate per annum obtained by dividing (i) the Base Eurodollar Rate applicable to that Eurodollar Interest Period by (ii) a percentage, calculated for each Lender in respect of the Loans made by it, equal to 100% minus the Eurodollar Reserve Percentage in effect as to such Lender, if any, on the relevant Eurodollar Interest Rate Determination Date. "Eurodollar Rate Loan" means (i) a Loan which bears interest at a rate determined by reference to the Eurodollar Rate and the Applicable Margin for Eurodollar Rate Loans, as provided in Section 5.1(a) or (ii) an overdue amount which was a Eurodollar Rate Loan immediately before it became due. 11 "Eurodollar Reserve Percentage" means the total of the maximum reserve percentages for determining the reserves to be maintained by member banks of the Federal Reserve System for Eurocurrency Liabilities, as defined in Federal Reserve Board Regulation D. The Eurodollar Reserve Percentage shall be expressed in decimal form and rounded upward, if necessary, to the nearest 1/100th of one percent, and shall include marginal, emergency, supplemental, special and other reserve percentages. "Event of Default" means any of the occurrences set forth in Section 11.1 after the expiration of any applicable grace period and the giving of any applicable notice, in each case as expressly provided in Section 11.1. "External Revenues" means all the excess of (i) gross revenues realized by GGP, Inc., the Consolidated Businesses and, to the extent allocable to the Consolidated Businesses in accordance with GAAP, the Minority Holdings, excluding only revenues realized in the ordinary course of business, but including, without limitation, proceeds of any sales of Properties, financings or refinancings of Properties, whether secured or unsecured, or sales or issuance of any Securities representing equity interests in or obligations of such entity, over (ii) the sum of (A) the reasonable and customary out-of-pocket cost, fees and expenses paid or incurred by GGP, Inc., the Consolidated Businesses and, to the extent allocable to the Consolidated Businesses in accordance with GAAP, the Minority Holdings in connection with the transactions or other proceedings from which such revenues were realized, (B) the amount of such proceeds applied to repay indebtedness secured by or otherwise directly related to the Property sold, financed or refinanced, and (C) the amount of such proceeds applied to acquire Property, other than Real Property, in replacement of Property, other than Real Property, so sold. "Facility Fee" is defined in Section 5.3(a). "Facility Fee Percentage" means the applicable percentage per annum determined, at any time, based on the range into which the Leverage Ratio then falls, in accordance with the following table. Any change in the Facility Fee Percentage shall be effective as of the applicable financial reporting date set forth in Section 8.2 hereof (exclusive of Section 8.2(b)(iv) hereof) and as of the date of the consummation and funding of each Capital Event. Facility Fee Percentage Leverage Ratio (% per annum) -------------- ------------- less than 45% 0.10% 45% to less than 50% 0.15% 50% to less than 55% 0.20% 55% to less than 60% 0.25% 60% or greater 0.30% 12 "Federal Funds Rate" means, for any period, a fluctuating interest rate per annum equal for each day during such period to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published for such day (or, if such day is not a Business Day in Chicago, Illinois, for the next preceding Business Day) in Chicago, Illinois by the Federal Reserve Bank of Chicago, or if such rate is not so published for any day which is a Business Day in Chicago, Illinois, the average of the quotations for such day on transactions by the Reference Bank, as reasonably determined by the Administrative Agent. "Federal Reserve Board" means the Board of Governors of the Federal Reserve System or any Governmental Authority succeeding to its functions. "FFO" means net income, as determined in accordance with GAAP, excluding gains (or losses) from debt restructuring and sales of property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures (which will be calculated to reflect funds from operations on the same basis). "Financial Statements" means (i) quarterly and annual Consolidated statements of income and retained earnings, statements of cash flow, and balance sheets, (ii) such other financial statements as GGP, Inc. and the Borrower shall routinely and regularly prepare on a quarterly or annual basis, and (iii) such other regularly prepared financial statements of the Consolidated Businesses or Minority Holdings as the Administrative Agent or the Requisite Lenders may from time to time reasonably specify; provided, however, that the Financial Statements referenced in clauses (i) and (ii) above shall be prepared in form satisfactory to the Administrative Agent. "Fiscal Year" means the fiscal year of the Borrower or GGP, Inc., as applicable, for accounting and tax purposes, which shall be the 12-month period ending on December 31 of each calendar year. "Fixed Charges" means, as of the first day of each fiscal quarter for the immediately preceding consecutive four fiscal quarters, the sum of (a) Combined Interest Expense and (b) the aggregate of all scheduled principal payments on Total Adjusted Outstanding Indebtedness according to GAAP made or required to be made during such fiscal period for the Consolidated Businesses and Minority Holdings (but excluding balloon payments of principal due upon the stated maturity of an Indebtedness), and (c) the aggregate of all dividends payable on the preferred stock of the Consolidated Businesses and GGP, Inc. not owned by the Borrower or any of its Affiliates. "Funding Date" means any date on which a Loan under this Agreement is made by the Lenders to the Borrower. "GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the American Institute of Certified Public Accountants' Accounting Principles Board and Financial Accounting Standards Board or in such other statements by such other entity as may be in general use by significant segments of the accounting profession as in 13 effect on the Closing Date (unless otherwise specified herein as in effect on another date or dates). "GGP, Inc." means General Growth Properties, Inc., a Delaware corporation. "Governmental Approval" means all right, title and interest in any existing or future certificates, licenses, permits, variances, authorizations and approvals issued by any Governmental Authority having jurisdiction with respect to any Property. "Governmental Authority" means any nation or government, any federal, state, local or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government. "Guaranty" means that certain Guaranty, dated as of even date herewith, made by GGP, Inc. in favor of the Administrative Agent, as agent for the Lenders, guaranteeing the payment and performance of the Obligations of the Borrower hereunder. "Holder" means any Person entitled to enforce any of the Obligations, whether or not such Person holds any evidence of Indebtedness, including, without limitation, the Administrative Agent and each other Lender. "Homart Portfolio" means the portfolio of Properties commonly described by the Borrower as GGP/Homart and GGP/Homart II, and their respective Subsidiaries and Investments. "Improvements" means, with respect to any Real Property, all buildings, fixtures, structures, parking areas, landscaping and all other improvements whether existing now or hereafter constructed, together with all machinery and mechanical, electrical, HVAC and plumbing systems presently or hereafter located thereon and used in the operation thereof, excluding (a) any such items owned by utility service providers, (b) any such items owned by tenants or other third- parties and (c) any items of personal property. "Inactive Assets" means Construction Assets (other than Real Estate Under Construction), loans receivable (including, without limitation, purchase money and other mortgage loans), and other miscellaneous Property not described in any of clauses (i) through (iv) of Section 10.11(d) hereof. "Indebtedness", as applied to any Person, means, at any time, without duplication, (a) all indebtedness, obligations or other liabilities of such Person (whether consolidated or representing the proportionate interest in any other Person) (i) for borrowed money (including construction loans) or evidenced by debt securities, debentures, acceptances, notes or other similar instruments, and any accrued interest, fees and charges relating thereto, (ii) under profit payment agreements or in respect of obligations to redeem, repurchase or exchange any Securities issued by such Person or to pay dividends in respect of any stock, (iii) with respect to letters of credit issued for such Person's account, (iv) to pay the deferred purchase price of property or services, except accounts payable and accrued expenses arising in the ordinary course of business, (v) in respect of Capital Leases, (vi) which are Contingent Obligations, (vii) under warranties and 14 indemnities or (viii) for the payment of taxes, levies, or other obligations which are then past due and payable to any Governmental Authority; (b) all indebtedness, obligations or other liabilities of such Person or others secured by a Lien on any property of such Person, whether or not such indebtedness, obligations or liabilities are assumed by such Person, all as of such time; (c) all indebtedness, obligations or other liabilities of such Person in respect of interest rate contracts and foreign exchange contracts, net of liabilities owed to such Person by the counterparties thereon; (d) all preferred stock and other Securities subject (upon the occurrence of any contingency or otherwise) to mandatory redemption by such Person; (e) all indebtedness, obligations or other liabilities of such person in respect of forward equity sales and similar purchase obligations, and (f) all contingent Contractual Obligations with respect to any of the foregoing. "Indemnified Matters" is defined in Section 15.3. "Indemnitees" is defined in Section 15.3. "Initial Funding Date" means the date on or after the Closing Date, on which all of the conditions described in Section 6.1 have been satisfied (or waived) in a manner satisfactory to the Administrative Agent and the Lenders and on which the initial Loans under this Agreement are made by the Lenders to the Borrower. "Internal Revenue Code" means the Internal Revenue Code of 1986, as amended to the date hereof and from time to time hereafter, any successor statute and any regulations or guidance having the force of law promulgated thereunder. "Investment" means, with respect to any Person, (i) any purchase or other acquisition by that Person of any Property, including, without limitation, Securities, or of a beneficial interest in Securities, issued by any other Person, (ii) any purchase by that Person of all or substantially all of the assets of a business conducted by another Person, and (iii) any loan, advance (other than deposits with financial institutions available for withdrawal on demand, prepaid expenses, accounts receivable, advances to employees and similar items made or incurred in the ordinary course of business) or capital contribution by that Person to any other Person, including all Indebtedness to such Person arising from a sale of property by such Person other than in the ordinary course of its business. The amount of any Investment shall be the original cost of such Investment, plus the cost of all additions thereto less the amount of any return of capital or principal to the extent such return is in cash with respect to such Investment without any adjustments for increases or decreases in value or write-ups, write-downs or write-offs with respect to such Investment. "Investment Grade" means (i) with respect to Moody's a Credit Rating of Baa3 or higher and (ii) with respect to S&P, a Credit Rating of BBB- or higher. "IRS" means the Internal Revenue Service and any Person succeeding to the functions thereof. 15 "Ivanhoe Portfolio" means the portfolio of Properties commonly described by the Borrower as GGP/Ivanhoe, GGP/Ivanhoe II and GGP/Ivanhoe III, and their respective Subsidiaries and Investments. "Joinder Agreement" is defined in Section 3.2 hereof. "knowledge" with reference to any Person or any Subsidiary of such Person, means the actual knowledge of an officer of such Person after reasonable inquiry (which reasonable inquiry shall include, without limitation, interviewing and questioning such other Persons as such Person or such Subsidiary, as applicable, deems reasonably necessary). "Lease" means a lease, license, concession agreement or other agreement providing for the use or occupancy of any portion of any Property, including all amendments, supplements, modifications and assignments thereof and all side letters or side agreements relating thereto. "Lender" means each of the Co-Arrangers and, at any other given time, each financial institution which is a party hereto as a Lender, whether as a signatory hereto, pursuant to an Assignment and Acceptance or pursuant to a Joinder Agreement, and regardless of the capacity in which such entity is acting (i.e. whether as a Co-Arranger or Lender). "Lender Process Agent" is defined in Section 15.17(a). "Leverage Ratio" means the ratio, expressed as a percentage, of the Total Adjusted Outstanding Indebtedness to the Capitalization Value. "Liabilities and Costs" means all liabilities, obligations, responsibilities, losses, damages, personal injury, death, punitive damages, economic damages, consequential damages, treble damages, intentional, willful or wanton injury, damage or threat to the environment, natural resources or public health or welfare, costs and expenses (including, without limitation, attorney, expert and consulting fees and costs of investigation, feasibility or Remedial Action studies), fines, penalties and monetary sanctions, interest, direct or indirect, known or unknown, absolute or contingent, past, present or future. "Lien" means any mortgage, deed of trust, pledge, hypothecation, assignment, conditional sale agreement, deposit arrangement, security interest, encumbrance, lien (statutory or other and including, without limitation, any Environmental Lien), preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever in respect of any property of a Person, whether granted voluntarily or imposed by law, and includes the interest of a lessor under a Capital Lease or under any financing lease having substantially the same economic effect as any of the foregoing and the filing of any financing statement or similar notice (other than a financing statement filed by a "true" lessor pursuant to (S) 9-408 of the Uniform Commercial Code), naming the owner of such property as debtor, under the Uniform Commercial Code or other comparable law of any jurisdiction. "Limited Minority Holdings" means Minority Holdings in which (i) the Borrower or GGP, Inc. has a less than fifty percent (50%) ownership interest or (ii) the Borrower or GGP, Inc. does not control the management of such Minority Holdings, whether as the general partner or 16 managing member of such Minority Holding, or otherwise or (iii) the Borrower or GGP, Inc. does not control decisions with respect to the financing or sale or other disposition of the assets thereof. As used in this definition only, the term "control" shall mean the authority to make major management decisions or the management of day-to-day operations of such entity and shall include instances in which the Management Company manages the day-to-day leasing, management, control or development of the Properties of such Minority Holding pursuant to the terms of a management agreement. "Loan Account" is defined in Section 4.3(b). "Loan Documents" means this Agreement, the Notes, the Guaranty and all other instruments, agreements and written Contractual Obligations between the Borrower and any of the Lenders pursuant to or in connection with the transactions contemplated hereby. "Loan" means a loan made by a Lender pursuant to Section 2.1; provided, that if any such loan or loans (or portions thereof) are combined or subdivided pursuant to a Notice of Conversion/Continuation under Section 4.1, the term "Loan" shall refer to the combined principal amount resulting from such combination or to each of the separate principal amounts resulting from such subdivision, as the case may be. "Loan-to-Value Ratio" means, with respect to all Indebtedness for borrowed money directly related to any Property or asset (including, without limitation, Indebtedness secured by a Lien thereon or on the equity interests in the entity owning such Property, or incurred to finance any construction thereon) the ratio (expressed as a percentage) of: (i) the amount of such Indebtedness; to (ii) the value of such Property or asset (which value shall be the Capitalization Value attributable thereto). "Management Company" means General Growth Management, Inc., a Delaware corporation and its Subsidiaries, and any of its successors and assigns that are Affiliates of GGP, Inc. "Margin Stock" means "margin stock" as such term is defined in Regulation U and Regulation G. "Material Adverse Effect" means a material adverse effect upon (i) the financial condition or assets of the Borrower and its Subsidiaries taken as a whole, (ii) the ability of the Borrower to perform its obligations under the Loan Documents, or (iii) the ability of the Lenders or the Administrative Agent to enforce any of the Loan Documents. "Maximum Revolving Credit Amount" means, at any particular time, the Revolving Credit Commitments at such time, which shall not exceed the Maximum Aggregate Commitment Amount. "Maximum Aggregate Commitment Amount" means $135,000,000, subject to increase in accordance with Article III hereof. 17 "Minority Holdings" means partnerships, joint ventures, trusts, limited liability companies and corporations held or owned by the Borrower, GGP, Inc. or the Management Company, which are not wholly-owned by the Borrower, GGP, Inc. or the Management Company. "Moody's" means Moody's Investor Services, Inc. "Multiemployer Plan" means a "multiemployer plan" as defined in Section 3(37) of ERISA which is, or within the immediately preceding six (6) years was, contributed to by either the Borrower or any ERISA Affiliate or in respect of which the Borrower or any ERISA Affiliate has assumed any liability. "Non Pro Rata Loan" is defined in Section 4.2 (b)(v). "Non-Recourse Indebtedness" means Indebtedness which is not Recourse Indebtedness. "Note" means a promissory note substantially in the form attached hereto as Exhibit B payable to a Lender, in form and substance acceptable to the Administrative Agent and such Lender, evidencing certain of the joint and several Obligations of and executed by the Borrower as required by Section 4.3(a), as well as any such other promissory note as is necessary to evidence the Loans owing to a Lender, after giving effect to any Assignment and Acceptance pursuant to Section 15.1, any Joinder Agreement pursuant to Section 3.2 and any Addendum hereto pursuant to Section 3.3, which is in form and substance acceptable to the Administrative Agent and the parties to such Assignment and Acceptance, Joinder Agreement or Addendum, as applicable. All such promissory notes, as the same may be amended, supplemented, modified or restated from time to time and all replacements thereof and substitutions therefor are collectively referred to herein as the "Notes." "Notice of Borrowing" means a notice substantially in the form of Exhibit C attached hereto and made a part hereof. "Notice of Conversion/Continuation" means a notice substantially in the form of Exhibit D attached hereto and made a part hereof with respect to a proposed conversion or continuation of a Loan pursuant to Section 5.1(c). "Obligations" means all Loans, advances, debts, liabilities, obligations, covenants and duties owing by the Borrower to the Administrative Agent, any other Lender, any Affiliate of the Administrative Agent, any other Lender, or any Person entitled to indemnification pursuant to Section 15.3 of this Agreement, of any kind or nature, arising under this Agreement, the Notes or any other Loan Document. The term includes, without limitation, all interest, charges, expenses, fees, reasonable attorneys' fees and disbursements and any other sum chargeable to the Borrower under this Agreement or any other Loan Document. "Officer's Certificate" means, as to a corporation, a certificate executed on behalf of such corporation by the chairman of its board of directors (if an officer of such corporation) or its chief executive officer, president, any of its vice-presidents, its chief financial officer, or its treasurer and, as to a partnership, a certificate executed on behalf of such partnership by the 18 chairman of the board of directors (if an officer of such corporation) or chief executive officer, president, any vice-president, or treasurer of the general partner of such partnership. "Organizational Documents" means, with respect to any corporation, limited liability company, trust or partnership (i) the articles/certificate of incorporation, formation or limited partnership (or the equivalent organizational documents) of such corporation or limited liability company, trust or limited partnership, (ii) the partnership agreement, operating agreement or trust agreement executed by the partners in the partnership, the members in the limited liability company or governing the trust, (iii) the bylaws (or the equivalent governing documents) of the corporation, limited liability company, trust or partnership, and (iv) any document setting forth the designation, amount and/or relative rights, limitations and preferences of any class or series of such corporation's Capital Stock or such limited liability company's, partnership's or trust's equity, ownership or beneficial interests. "OSHA" means the Occupational Safety and Health Act of 1970, 29 U.S.C. (S)(S) 651 et seq., any amendments thereto, any successor statutes and any regulations or guidance having the force of law promulgated thereunder. "Partnership" is defined in the preamble to this Agreement. "PBGC" means the Pension Benefit Guaranty Corporation and any Person succeeding to the functions thereof. "Permits" means any permit, consent, approval, authorization, license, variance, or permission required from any Person, including any Governmental Approvals. "Person" means any natural person, corporation, limited liability company, limited partnership, general partnership, joint stock company, joint venture, association, company, trust, bank, trust company, land trust, business trust or other organization, whether or not a legal entity, and any Governmental Authority. "Plan" means an "employee benefit" plan defined in Section 3(3) of ERISA in respect of which the Borrower or any ERISA Affiliate is, or within the immediately preceding six (6) years was, an "employer" as defined in Section 3(5) of ERISA or the Borrower or any ERISA Affiliate has assumed any liability. "Potential Event of Default" means an event which, with the giving of notice or the lapse of time, or both, would constitute an Event of Default. "Prepayment Date" is defined in Section 4.1(d). "Process Agent" is defined in Section 15.17(a). "Property" means any Real Property or personal property, plant, building, facility, structure, underground storage tank or unit, equipment, general intangible, receivable, or other asset owned, leased or operated by any Consolidated Business or any Minority Holding (including any surface water thereon or adjacent thereto, and soil and groundwater thereunder). 19 "Pro Rata Share" means, with respect to any Lender, the percentage obtained by dividing (i) the sum of such Lender's Revolving Credit Commitments (in each case, as adjusted from time to time in accordance with the provisions of this Agreement or any Assignment and Acceptance, Joinder Agreement or Addendum to which such Lender is a party) by (ii) the aggregate amount of all of the Lenders' Revolving Credit Commitments. "Rate Page" means the display designated as "Page 3750" on the Associated Press-Dow Jones Telerate Service (or such other page as may replace Page 3750 on the Associated Press-Dow Jones Telerate Service or such other service as may be nominated by the British Bankers' Association as the information vendor for the purpose of displaying British Bankers' Association interest settlement rates for U.S. Dollar deposits). "RCRA" means the Resource Conservation and Recovery Act of 1976, 42 U.S.C. (S)(S) 6901 et seq., any amendments thereto, any successor statutes, and any regulations or guidance having the force of law promulgated thereunder. "Real Estate Under Construction" means Real Property on which construction of material improvements has commenced and is continuing to be performed, but has not yet been completed (as such completion shall be evidenced by such Property being opened for business to the general public). "Real Property" means all of the Borrower's or any Subsidiary of Borrower's present and future right, title and interest (including, without limitation, any leasehold estate) in (i) any plots, pieces or parcels of land, (ii) any Improvements of every nature whatsoever (the rights and interests described in clauses (i) and (ii) above being the "Premises"), (iii) all easements, rights of way, gores of land or any lands occupied by streets, ways, alleys, passages, sewer rights, water courses, water rights and powers, and public places adjoining such land, and any other interests in property constituting appurtenances to the Premises, or which hereafter shall in any way belong, relate or be appurtenant thereto, (iv) all hereditaments, gas, oil, minerals (with the right to extract, sever and remove such gas, oil and minerals), and easements, of every nature whatsoever, located in, on or benefiting the Premises and (v) all other rights and privileges thereunto belonging or appertaining and all extensions, additions, improvements, betterments, renewals, substitutions and replacements to or of any of the rights and interests described in clauses (iii) and (iv) above. "Recourse Indebtedness" means any Indebtedness, to the extent that recourse of the applicable lender for non-payment is not limited to such lender's Liens on a particular asset or group of assets (except to the extent the property on which such lender has a Lien and to which its recourse for non-payment is limited constitutes Cash or Cash Equivalents, to which extent such Indebtedness shall be deemed to be Recourse Indebtedness). "Reference Bank" means Bank of America. "Register" is defined in Section 15.1(c). 20 "Regulation A" means Regulation A of the Federal Reserve Board as in effect from time to time. "Regulation G" means Regulation G of the Federal Reserve Board as in effect from time to time. "Regulation T" means Regulation T of the Federal Reserve Board as in effect from time to time. "Regulation U" means Regulation U of the Federal Reserve Board as in effect from time to time. "Regulation X" means Regulation X of the Federal Reserve Board as in effect from time to time. "REIT" means a domestic trust or corporation that qualifies as a real estate investment trust under the provisions of Sections 856, et seq. of the Internal Revenue Code. "Release" means any release, spill, emission, leaking, pumping, pouring, dumping, injection, deposit, disposal, abandonment, or discarding of barrels, containers or other receptacles, discharge, emptying, escape, dispersal, leaching or migration into the indoor or outdoor environment or into or out of any Property, including the movement of Contaminants through or in the air, soil, surface water, groundwater or Property. "Remedial Action" means actions required to (i) clean up, remove, treat or in any other way address Contaminants in the indoor or outdoor environment; (ii) prevent the Release or threat of Release or minimize the further Release of Contaminants; or (iii) investigate and determine if a remedial response is needed and to design such a response and post-remedial investigation, monitoring, operation and maintenance and care. "Reportable Event" means any of the events described in Section 4043(c) of ERISA and the regulations having the force of law promulgated thereunder as in effect from time to time but not including any such event as to which the thirty (30) day notice requirement has been waived by applicable PBGC regulations. "Requirements of Law" means, as to any Person, the charter and bylaws or other organizational or governing documents of such Person, and any law, rule or regulation, or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject including, without limitation, the Securities Act, the Securities Exchange Act, Regulations G, T, U and X, ERISA, the Fair Labor Standards Act, the Worker Adjustment and Retraining Notification Act, Americans with Disabilities Act of 1990, and any certificate of occupancy, zoning ordinance, building, environmental or land use requirement or Permit and Environmental, Health or Safety Requirement of Law. 21 "Requisite Lenders" means the Lenders whose Pro Rata Shares, in the aggregate, represent an amount equal to or more than sixty-six and two-thirds percent (66-2/3%) of the aggregate Pro Rata Shares of all Lenders which are not then Defaulting Lenders. "Revolving Credit Availability" means, at any particular time, the amount by which the Maximum Revolving Credit Amount at such time exceeds the Revolving Credit Obligations at such time. "Revolving Credit Commitment" means, with respect to any Lender, the obligation of such Lender to make Loans pursuant to the terms and conditions of this Agreement, and which shall not exceed the principal amount set forth opposite such Lender's name under the heading "Revolving Credit Commitment" on the signature pages hereof or the signature page of the Assignment and Acceptance or Joinder Agreement by which it became a Lender, as modified from time to time pursuant to the terms of this Agreement or to give effect to any applicable Assignment and Acceptance or Addendum, and "Revolving Credit Commitments" means the aggregate principal amount of the Revolving Credit Commitments of all the Lenders, which shall not exceed the Maximum Aggregate Commitment Amount, as the Revolving Credit Commitments may be reduced from time to time pursuant to Section 4.1(b) hereof or increased from time to time in connection with any increase in the Maximum Aggregate Commitment Amount pursuant to Section 3.1 hereof. "Revolving Credit Obligations" means, at any particular time, the sum of the outstanding principal amount of the Loans at such time. "Revolving Credit Period" means the period from the Initial Funding Date to the Business Day next preceding the Revolving Credit Termination Date. "Revolving Credit Termination Date" means the earlier to occur of (i) July 31, 2003 (or, if not a Business Day, the next preceding Business Day); and (ii) the date of termination of the Revolving Credit Commitments pursuant to the terms of this Agreement. "S&P" means Standard & Poor's Ratings Services, a Division of The McGraw Hill Companies, Inc. "Secured Indebtedness" means any Indebtedness secured by a Lien. "Securities" means any stock, shares, voting trust certificates, partnership interests, bonds, debentures, notes or other evidences of indebtedness, secured or unsecured, convertible, subordinated or otherwise, or in general any instruments commonly known as "securities", including, without limitation, any "security" as such term is defined in Section 8-102 of the Uniform Commercial Code, or any certificates of interest, shares, or participations in temporary or interim certificates for the purchase or acquisition of, or any right to subscribe to, purchase or acquire any of the foregoing, but shall not include the Notes or any other evidence of the Obligations. "Securities Act" means the Securities Act of 1933, as amended from time to time, and any successor statute. 22 "Securities Exchange Act" means the Securities Exchange Act of 1934, as amended from time to time, and any successor statute. "Solvent", when used with respect to any Person, means that at the time of determination: (a) the fair saleable value of its assets is in excess of the total amount of its liabilities (including, without limitation, contingent liabilities); and (b) the present fair saleable value of its assets is greater than its probable liability on its existing debts as such debts become absolute and matured; and (c) it is then able and expects to be able to pay its debts (including, without limitation, contingent debts and other commitments) as they mature; and (d) it has capital sufficient to carry on its business as conducted and as proposed to be conducted. "Subsidiary" of a Person means any corporation, limited liability company, general or limited partnership, trust or other entity of which Securities or other ownership interests having ordinary voting power to elect a majority of the board of directors or other persons performing similar functions are at the time directly or indirectly owned or controlled by such Person, one or more of the other subsidiaries of such Person or any combination thereof. For purposes of this Agreement, Subsidiaries of GGP, Inc. shall be considered Subsidiaries of the Borrower. "Syndication Agent" is defined in the preamble and includes USB in its capacity as syndication agent for the Lenders and each successor syndication agent appointed in accordance with the terms of this Agreement. "Taxes" is defined in Section 13.1(a) hereof. "Tenant Allowance" means a cash allowance paid to a tenant by the landlord pursuant to a Lease. "TI Work" means any construction or other "build-out" of tenant leasehold improvements to the space demised to such tenant under Leases (excluding such tenant's furniture, fixtures and equipment) performed pursuant to the terms of such Leases, whether or not such tenant improvement work is performed by or on behalf of the landlord or as part of a Tenant Allowance. "Total Adjusted Outstanding Indebtedness" means, for any period, the sum of (i) the amount of Indebtedness of GGP, Inc. and the Consolidated Businesses set forth on the then most recent quarterly financial statements of GGP, Inc. and the Borrower, as applicable, and (ii) the outstanding amount of Minority Holding Indebtedness pro rata allocable to the Borrower and GGP, Inc. as of the time of determination and (iii) without duplication, the Contingent Obligations of GGP, Inc. and the Consolidated Businesses and, to the extent allocable to GGP, Inc. and the Consolidated Businesses in accordance with GAAP, of the Minority Holdings, provided however that for purposes of this calculation only, the term "Indebtedness" shall not include Indebtedness with respect to letters of credit issued to support guaranties of interest or 23 interest and principal, or operating income guaranties or other performance guaranty or completion guaranty obligations; provided, however, that the exclusion for letters of credit issued to support performance guaranty obligations shall not exceed 1.0% of Capitalization Value. "Total Adjusted Outstanding Unsecured Indebtedness" means that portion of Total Adjusted Outstanding Indebtedness that is Unsecured Indebtedness. "USB" is defined in the preamble to this Agreement. "Uniform Commercial Code" means the Uniform Commercial Code as enacted in the State of Illinois, as it may be amended from time to time. "Unsecured Indebtedness" means Indebtedness that is not secured by any Lien. 1.2 Computation of Time Periods. In this Agreement, in the computation of periods of time from a specified date to a later specified date, the word "from" means "from and including" and the words "to" and "until" each mean "to but excluding". Periods of days referred to in this Agreement shall be counted in calendar days unless Business Days are expressly prescribed. Any period determined hereunder by reference to a month or months or year or years shall end on the day in the relevant calendar month in the relevant year, if applicable, immediately preceding the date numerically corresponding to the first day of such period, provided, that if such period commences on the last day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month during which such period is to end), such period shall, unless otherwise expressly required by the other provisions of this Agreement, end on the last day of the calendar month. 1.3 Accounting Terms. Subject to Section 15.4, for purposes of this Agreement, all accounting terms not otherwise defined herein shall have the meanings assigned to them in conformity with GAAP. 1.4 Other Terms. All other terms contained in this Agreement shall, unless the context indicates otherwise, have the meanings assigned to such terms by the Uniform Commercial Code to the extent the same are defined therein. ARTICLE II - AMOUNTS AND TERMS OF LOANS 2.1 Loans. ----- (a) Availability. Subject to the terms and conditions set forth in ------------ this Agreement, each Lender hereby severally and not jointly agrees to make revolving loans, in Dollars (each individually, a "Loan" and, collectively, the "Loans") to the Borrower from time to time during the Revolving Credit Period, in an amount not to exceed such Lender's Pro Rata Share of the Revolving Credit Availability at such time. All Loans comprising the same Borrowing under this Agreement shall be made by the Lenders simultaneously and proportionately to their then respective Pro Rata Shares, it being understood that no Lender shall be responsible for any failure by any other Lender to perform its obligation to make a Loan hereunder nor shall the Revolving Credit Commitment of any Lender be increased or decreased 24 as a result of any such failure. Subject to the provisions of this Agreement, the Borrower may repay any outstanding Loan on any day which is a Business Day and any amounts so repaid may be reborrowed, up to the amount available under this Section 2.1(a) at the time of such Borrowing, until the Business Day next preceding the Revolving Credit Termination Date. Each requested Borrowing of Loans funded on any Funding Date shall be in a principal amount of at least $2,000,000 and (i) in integral multiples of $1,000,000 in excess of that amount, in the case of any Borrowing of Eurodollar Rate Loans, and (ii) in integral multiples of $500,000 in excess of that amount, in the case of any Borrowing of Base Rate Loans; provided, however, that if the aggregate Revolving Credit Commitments outstanding at the time of such requested Borrowing is less than $2,000,000, then the requested Borrowing shall be for the total amount of such outstanding aggregate Revolving Credit Commitments. (b) Notice of Borrowing. When the Borrower desires to borrow under this Section 2.1, it shall deliver to the Administrative Agent a Notice of Borrowing, signed by it (i) no later than 11:00 a.m. (Chicago time) on the Business Day immediately preceding the proposed Funding Date, in the case of a Borrowing of Base Rate Loans and (ii) no later than 11:00 a.m. (Chicago time) at least three (3) Business Days in advance of the proposed Funding Date, in the case of a Borrowing of Eurodollar Rate Loans; provided, however, that no Borrowing may be made within less than five (5) Business Days after any given Borrowing. Such Notice of Borrowing shall specify (i) the proposed Funding Date (which shall be a Business Day), (ii) the amount of the proposed Borrowing, (iii) the Revolving Credit Availability as of the date of such Notice of Borrowing, (iv) whether the proposed Borrowing will be of Base Rate Loans or Eurodollar Rate Loans, (v) in the case of Eurodollar Rate Loans, the requested Eurodollar Interest Period and (vi) instructions for the disbursement of the proceeds of the proposed Borrowing. In lieu of delivering such a Notice of Borrowing (except with respect to a Borrowing of Loans on the Initial Funding Date), the Borrower may give the Administrative Agent telephonic notice of any proposed Borrowing by the time required under this Section 2.1(b), if the Borrower confirms such notice by delivery of the Notice of Borrowing to the Administrative Agent by facsimile transmission promptly, but in no event later than 12:00 noon (Chicago time) on the same day. Any Notice of Borrowing (or telephonic notice in lieu thereof) given pursuant to this Section 2.1(b) shall be irrevocable. (c) Making of Loans. (i) Promptly after receipt of a Notice of Borrowing under Section 2.1(b) (or telephonic notice in lieu thereof), the Administrative Agent shall notify each Lender by facsimile transmission, or other similar form of transmission, of the proposed Borrowing (which notice to the Lenders, in the case of a Borrowing of Eurodollar Rate Loans, shall be at least three (3) Business Days in advance of the proposed Funding Date for such Loans). Each Lender shall deposit an amount equal to its Pro Rata Share of the Borrowing requested by the Borrower with the Administrative Agent at its office in Chicago, Illinois in immediately available funds, not later than 11:00 a.m. (Chicago time) on the respective Funding Date therefor. Subject to the fulfillment of the conditions precedent set forth in Section 6.1 or Section 6.2, as applicable, the Administrative Agent shall make the proceeds of such amounts received by it available to the Borrower at the Administrative Agent's office in Chicago, Illinois on such Funding Date (or on the date received if later than such Funding Date) and shall disburse such proceeds in accordance 25 with the Borrower's disbursement instructions set forth in the applicable Notice of Borrowing. The failure of any Lender to deposit the amount described above with the Administrative Agent on the applicable Funding Date shall not relieve any other Lender of its obligations hereunder to make its Loan on such Funding Date. In the event the conditions precedent set forth in Section 6.1 or Section 6.2, as applicable, are not fulfilled as of the proposed Funding Date for any Borrowing, the Administrative Agent shall promptly return to each Lender, by wire transfer of immediately available funds, the amount deposited by such Lender. (ii) Unless the Administrative Agent shall have been notified by any Lender on the Business Day immediately preceding the applicable Funding Date in respect of any Borrowing that such Lender does not intend to fund its Loan requested to be funded on such Funding Date, the Administrative Agent may assume that such Lender has funded its Loan and is depositing the proceeds thereof with the Administrative Agent on such Funding Date, and the Administrative Agent in its sole discretion may, but shall not be obligated to, disburse a corresponding amount to the Borrower on such Funding Date. If the Loan proceeds corresponding to that amount are advanced to the Borrower by the Administrative Agent but are not in fact deposited with the Administrative Agent by such Lender on or prior to such Funding Date, such Lender agrees to pay, and in addition the Borrower agrees to repay, to the Administrative Agent forthwith on demand such corresponding amount of such advance by the Administrative Agent, together with interest thereon, for each day from the date such amount is disbursed to or for the benefit of the Borrower until the date such amount is paid or repaid to the Administrative Agent, at the interest rate applicable to such Borrowing. If such Lender shall pay to the Administrative Agent the corresponding amount of such advance by the Administrative Agent, the amount so paid shall constitute such Lender's Loan, and if both such Lender and the Borrower shall pay and repay such corresponding amount, the Administrative Agent shall promptly pay to the Borrower such corresponding amount of such advance by the Administrative Agent. This Section 2.1(c)(ii) does not relieve any Lender of its obligation to make its Loan on any applicable Funding Date. (d) [Intentionally Omitted] 2.2 [Intentionally Omitted] 2.3 Use of Proceeds of Loans. The proceeds of the Loans to the Borrower hereunder may be used for the purposes of: (a) acquisition of Real Properties, directly or through a Subsidiary or Minority Holding, by the Borrower; (b) development of Real Properties owned, directly or indirectly, and operated by the Borrower; and (c) other general and working capital needs of the Borrower, inclusive of repayment of Indebtedness for borrowed money; 26 each of which purposes described in clauses (a) through (c) above shall be lawful working capital purposes of the Borrower. 2.4 Revolving Credit Termination Date. The Revolving Credit Commitments shall terminate, and all outstanding Revolving Credit Obligations shall be paid in full, on the Revolving Credit Termination Date. Each Lender's obligation to make Loans shall terminate on the Business Day next preceding the Revolving Credit Termination Date. 2.5 [Intentionally Omitted] 2.6 Maximum Credit Facility. Notwithstanding anything in this Agreement to the contrary, in no event shall the aggregate Revolving Credit Obligations exceed the Maximum Aggregate Commitment Amount. 2.7 Authorized Agents. On the Closing Date and from time to time thereafter, the Borrower shall deliver to the Administrative Agent an Officer's Certificate setting forth the names of the employees and agents authorized to request Loans and to request a conversion/continuation of any Loan and containing a specimen signature of each such employee or agent. The employees and agents so authorized shall also be authorized to act for the Borrower in respect of all other matters relating to the Loan Documents. The Administrative Agent and the Lenders shall be entitled to rely conclusively on such employee's or agent's authority to request such Loan or such conversion/continuation until the Administrative Agent receives written notice to the contrary. The Administrative Agent shall have no duty to verify the authenticity of the signature appearing on any written Notice of Borrowing or Notice of Conversion/Continuation or any other document, and, with respect to an oral request for any Loan or any conversion/continuation, the Administrative Agent shall have no duty to verify the identity of any person representing himself or herself as one of the employees or agents authorized to make such request or otherwise to act on behalf of the Borrower. None of the Administrative Agent or the Lenders shall incur any liability to the Borrower or any other Person in acting upon any telephonic or facsimile notice referred to above which the Administrative Agent or such Lender reasonably believes to have been given by a person duly authorized to act on behalf of the Borrower and the Borrower hereby indemnifies and holds harmless the Administrative Agent and each other Lender from any loss or expense the Administrative Agent or the Lenders incur in acting in good faith as provided in this Section 2.7., provided however that the Borrower shall not indemnify or hold harmless the Administrative Agent or any other Lender from any loss or expense incurred as the result of the Administrative Agent's or such Lender's gross negligence or willful misconduct. ARTICLE III - INCREASE OF THE FACILITY 3.1 Increase in Maximum Aggregate Commitment Amount. In no event shall the Revolving Credit Commitments exceed the Maximum Aggregate Commitment Amount. Notwithstanding anything to the contrary contained herein, in connection with any proposed increase in the Revolving Credit Commitment(s) of any Lender(s) or any proposed joinder of any Eligible Assignee(s) as a new Lender(s) party to this Agreement, the Maximum Aggregate Commitment Amount may be increased (i) with the consent of the Co-Arrangers and the 27 Borrower, to an amount not greater than $250,000,000, and (ii) with the consent of all of the Lenders and the Borrower, to an amount in excess of $250,000,000. 3.2 Joinder of New Lender. In the event of any such proposed joinder by an Eligible Assignee, such joinder shall occur only as to a Revolving Credit Commitment by such Eligible Assignee that will not cause all Revolving Credit Commitments to exceed the Maximum Aggregate Commitment Amount, after giving effect to such joinder and any other such joinders and any increases under Section 3.3 hereof to occur substantially contemporaneously therewith. The proposed joinder of any Eligible Assignee satisfying the requirements of the preceding sentence shall be effectuated through such Eligible Assignee's execution and delivery to the Administrative Agent, the Borrower and each Lender of a joinder agreement ("Joinder Agreement"), in form and content reasonably satisfactory to the Administrative Agent and the Borrower, pursuant to which such Eligible Assignee agrees to become a Lender hereunder and under the other Loan Documents and assumes all of the obligations of a Lender hereunder and thereunder, whereupon, effective as of the date of such execution and delivery: (a) such Eligible Assignee shall become a Lender party to this Agreement for all purposes hereof, entitled to all of the rights and subject to all of the obligations of a Lender hereunder, (b) the Revolving Credit Commitment of such Eligible Assignee shall be the amount committed by such Eligible Assignee as set forth in such Joinder Agreement (which amount will not cause all Revolving Credit Commitments to exceed the Maximum Aggregate Commitment Amount, after giving effect to such joinder and any other such joinders and any increases under Section 3.3 hereof to occur substantially contemporaneously therewith), (c) the Borrower shall immediately pay to such Eligible Assignee such fees as the Borrower may have agreed to pay in connection with the joinder of such Eligible Assignee, (d) each such Eligible Assignee shall immediately purchase from each party hereto that was a Lender immediately prior to such effective date, and pay to each such Lender at par, such Eligible Assignee's Pro Rata Share of each such Lender's Loans then outstanding hereunder (including, without limitation, interest then accrued and unpaid thereon), and (e) the Borrower shall immediately deliver to each such Eligible Assignee a Note substantially in the form attached hereto as Exhibit B in the amount of such Eligible Assignee's Revolving Credit Commitment. 3.3 Increase in Commitment of Existing Lender. In the event of any such proposed increase in the Revolving Credit Commitment of any Lender, such increase shall occur only as to an increase in an amount that will not cause all Revolving Credit Commitments to exceed the Maximum Aggregate Commitment Amount, after giving effect to such increase and any other such increases and any joinders under Section 3.2 hereof to occur substantially contemporaneously therewith. Any proposed increase satisfying the requirements of the preceding sentence shall be effectuated through such Lender's execution and delivery to the Administrative Agent, the Borrower and each Lender of an addendum to this Agreement 28 ("Addendum"), in form and content reasonably satisfactory to the Administrative Agent and the Borrower, evidencing such increase, whereupon, effective as of the date of such execution and delivery: (a) the Revolving Commitment of such Lender shall be increased by the amount set forth in such Addendum (which amount shall not cause all Revolving Credit Commitments to exceed the Maximum Aggregate Commitment Amount, after giving effect to such increase and any other such increases and any joinders under Section 3.2 hereof to occur substantially contemporaneously therewith), (b) the Borrower shall immediately pay to such Lender such fees as the Borrower may have agreed to pay in connection with such increase, (c) such Lender shall immediately purchase from each other Lender that was a party hereto immediately prior to such effective date, and pay to each such other Lender at par, a percentage of each such other Lender's Loans then outstanding hereunder (including, without limitation, interest then accrued and unpaid thereon), which percentage shall equal the increase in such purchasing Lender's Pro Rata Share resulting from the increase in its Revolving Credit Commitment, and (d) the Borrower shall immediately deliver to each such Lender a replacement Note substantially in the form attached hereto as Exhibit B in the amount of such Lender's Revolving Credit Commitment, upon receipt of which such Lender shall surrender its original Note marked "Replaced." ARTICLE IV - PAYMENTS AND PREPAYMENTS 4.1 Prepayments; Reductions in Revolving Credit Commitments. (a) Voluntary Prepayments. The Borrower may, at any time and from time to time, prepay the Loans, in part or in their entirety, subject to the following limitations. The Borrower shall give at least five (5) days' prior written notice to the Administrative Agent (which the Administrative Agent shall promptly transmit to each Lender) of any prepayment in the entirety to be made prior to the occurrence of an Event of Default, which notice of prepayment shall specify the date (which shall be a Business Day) of prepayment. When notice of prepayment is delivered as provided herein, the outstanding principal amount of the Loans to be prepaid on the prepayment date specified in the notice shall become due and payable on such prepayment date. Each voluntary partial prepayment of the Loans shall be in a minimum amount of $1,000,000. Eurodollar Rate Loans may be prepaid in part or in their entirety only upon payment of the amounts described in Section 5.2(f). (b) Voluntary Reductions In Revolving Credit Commitments. The Borrower may, upon at least five (5) days' prior written notice to the Administrative Agent (which the Administrative Agent shall promptly transmit to each Lender), at any time and from time to time, terminate in whole or permanently reduce in part the Revolving Credit Commitments; provided that the Borrower shall have made whatever payment may be required to reduce the Revolving 29 Credit Obligations to an amount less than or equal to the Revolving Credit Commitments as reduced or terminated, which amount shall become due and payable on the date specified in such notice. Any partial reduction of the Revolving Credit Commitments shall be in an aggregate minimum amount of $1,000,000, and shall reduce the Revolving Credit Commitment of each Lender proportionately in accordance with its Pro Rata Share. Any notice of termination or reduction given to the Administrative Agent under this Section 4.1(b) shall specify the date (which shall be a Business Day) of such termination or reduction and, with respect to a partial reduction, the aggregate principal amount thereof. (c) No Penalty. The prepayments and payments in respect of reductions and terminations described in clauses (a) and (b) of this Section 4.1 may be made without premium or penalty (except as provided in Section 5.2(f)). (d) Mandatory Prepayment. (i) If at any time from and after the Closing Date: (i) the Borrower merges or consolidates with another Person and the Borrower is not the surviving entity, or (ii) within any twelve (12) month period, the Borrower or any Consolidated Subsidiary or any Minority Holding sells, transfers, assigns, conveys or suffers foreclosure as to assets, the book value of which (computed in accordance with GAAP but without deduction for depreciation), in the aggregate of all such sales, transfers, assignments, foreclosures or conveyances exceeds twenty percent (20%) of the then Capitalization Value, or (iii) the portion of Capitalization Value attributable to the aggregate Limited Minority Holdings (exclusive of Limited Minority Holdings existing as of the Closing Date) of the Borrower and its Consolidated Subsidiaries exceeds twenty percent (20%) of the then Capitalization Value, or (iv) the Management Company ceases to provide property management and leasing services to at least seventy-five percent (75%) of the total number of Real Properties in which the Borrower has an ownership interest, excluding any such Real Properties that are Limited Minority Holdings (the date any such event shall occur being the "Prepayment Date"), the Revolving Credit Commitments shall be terminated and the Borrower shall be required to prepay the Loans in their entirety as if the Prepayment Date were the Revolving Credit Termination Date. The Borrower shall immediately make such prepayment together with interest accrued to the date of the prepayment on the principal amount prepaid. In connection with the prepayment of any Loan prior to the maturity thereof, the Borrower shall also pay any applicable expenses pursuant to Section 5.2(f). Each such prepayment shall be applied to prepay ratably the Loans of the Lenders. Amounts prepaid pursuant to this Section 4.1(d)(i) may not be reborrowed. As used in this Section 4.1(d)(i) only, the phrase "sells, transfers, assigns or conveys" shall not include (i) sales or conveyances among Borrower and any Consolidated Subsidiaries, or (ii) mortgages secured by Real Property, or (iii) sales or conveyances of Securities representing interests in or obligations of the Borrower or newly-formed Subsidiaries or Minority Holdings in connection with the acquisition of interests in Real Property. (ii) If an Event of Default shall occur under Section 10.12(e) hereof and for so long as it shall be continuing, then, in addition of all other rights and remedies of the Administrative Agent and the Lenders hereunder in respect of such Event of Default, the Borrower shall apply all External Revenues, within thirty (30) days after receipt thereof, to pay or prepay, as the case may be, on a pro rata basis, all Total Adjusted Outstanding Unsecured 30 Indebtedness for borrowed money, including, without limitation, the Loans then outstanding hereunder; provided, however, that no such application of External Revenues, nor any demand therefor or acceptance thereof by the Administrative Agent, the Lenders or any other lender, shall result in any waiver, release, limitation or impairment of any Obligation of the Borrower, or of any right, remedy or recourse of the Administrative Agent and the Lenders, in connection with such Event of Default. 4.2 Payments. (a) Manner and Time of Payment. All payments of principal and interest on the Loans and other Obligations (including, without limitation, fees and expenses) which are payable to the Administrative Agent or any other Lender shall be made without condition or reservation of right, in immediately available funds, transmitted to the Administrative Agent not later than 11:00 a.m. (Chicago time) on the date and at the place due, to such account of the Administrative Agent as it may designate, for the account of the Administrative Agent or such other Lender, as the case may be; and funds received by the Administrative Agent, including, without limitation, funds in respect of any Loans to be made on that date, not later than 11:00 a.m. (Chicago time) on any given Business Day shall be credited against payment to be made that day and funds received by the Administrative Agent after that time shall be deemed to have been paid on the next succeeding Business Day. Payments actually received by the Administrative Agent for the account of the Lenders, or any of them, shall be paid to them in immediately available funds by the Administrative Agent promptly after receipt thereof. (b) Apportionment of Payments. (i) Subject to the provisions of Section 4.2(b)(v), all payments of principal and interest in respect of outstanding Loans, all payments of fees and all other payments in respect of any other Obligations, shall be allocated among such of the Lenders as are entitled thereto, in proportion to their respective Pro Rata Shares or otherwise as provided herein. Subject to the provisions of Section 4.2(b)(ii), all such payments and any other amounts received by the Administrative Agent from or for the benefit of the Borrower shall be applied in the following order: (1) first, to pay principal and interest on any portion of the Loans which the Administrative Agent may have advanced on behalf of any Lender other than Bank of America for which the Administrative Agent has not then been reimbursed by such Lender or the Borrower, (2) second, to pay all other Obligations then due and payable, and (3) third, as the Borrower so designates. Unless otherwise designated by the Borrower, all principal payments in respect of Loans shall be applied first, to repay outstanding Base Rate Loans, and then to repay outstanding Eurodollar 31 Rate Loans, with those Eurodollar Rate Loans which have earlier expiring Eurodollar Interest Periods being repaid prior to those which have later expiring Eurodollar Interest Periods. (ii) After the occurrence of an Event of Default and while the same is continuing, the Administrative Agent shall apply all payments in respect of any Obligations in the following order: (1) first, to pay principal and interest on any portion of the Loans which the Administrative Agent may have advanced on behalf of any Lender other than Bank of America for which the Administrative Agent has not then been reimbursed by such Lender or the Borrower; (2) second, to pay Obligations in respect of any fees, expense reimbursements or indemnities then due to the Co-Arrangers, or any of them, in their respective capacities as such and not as Lenders; (3) third, to pay Obligations in respect of any fees, expense reimbursements or indemnities then due to the Lenders; (4) fourth, to pay interest due in respect of Loans; (5) fifth, to the ratable payment or prepayment of the outstanding principal amounts of Loans; and (6) sixth to the ratable payment of all other Obligations. The order of priority set forth in this Section 4.2(b)(ii) and the related provisions of this Agreement are set forth solely to determine the rights and priorities of the Administrative Agent, the other Lenders and other Holders as among themselves. The order of priority set forth in clauses (3) through (6) of this Section 4.2(b)(ii) may at any time and from time to time be changed by the Requisite Lenders without necessity of notice to or consent of or approval by the Borrower, any Holder which is not a Lender, or any other Person; provided, however, that no such change shall favor any Lender over any other Lender. The order of priority set forth in clauses (1) and (2) of this Section 4.2(b)(ii) may be changed only with the prior written consent of the Administrative Agent. (iii) Upon the occurrence and during the continuation of an Event of Default, the Administrative Agent, in its sole discretion subject only to the terms of this Section 4.2(b)(iii), may pay from the proceeds of Loans made to the Borrower hereunder, whether made following a request by the Borrower pursuant to Section 2.1 or a deemed request as provided in this Section 4.2(b)(iii), all amounts payable by the Borrower hereunder, including, without limitation, amounts payable with respect to payments of principal, interest and fees and all reimbursements for expenses pursuant to Section 15.2. The Borrower hereby irrevocably authorizes the Lenders, upon the occurrence and during the continuation of an Event of Default, to make Loans, which Loans shall be Base Rate Loans, in each case, upon notice from the Administrative Agent as described in the following sentence, for the purpose of paying principal, interest and fees due from the Borrower, reimbursing expenses pursuant to Section 15.2 and 32 paying any and all other amounts due and payable by the Borrower hereunder or under the Notes, and agrees that all such Loans so made shall be deemed to have been requested by it pursuant to Section 2.1 as of the date of the aforementioned notice. The Administrative Agent shall request Loans on behalf of the Borrower as described in the preceding sentence by notifying the Lenders by facsimile transmission or other similar form of transmission (which notice the Administrative Agent shall thereafter promptly transmit to the Borrower), of the amount and Funding Date of the proposed Borrowing and that such Borrowing is being requested on the Borrower's behalf pursuant to this Section 4.2(b)(iii). On the proposed Funding Date, the Lenders shall make the requested Loans in accordance with the procedures and subject to the conditions specified in Section 2.1. (iv) Subject to Section 4.2(b)(v), the Administrative Agent shall promptly distribute to each other Lender at its primary address set forth on the appropriate signature page hereof or the signature page to the Assignment and Acceptance or the Joinder Agreement by which it became a Lender, or at such other address as a Lender or other Holder may request in writing, such funds as such Person may be entitled to receive, subject to the provisions of Article XII; provided, however, that the Administrative Agent shall under no circumstances be bound to inquire into or determine the validity, scope or priority of any interest or entitlement of any Holder and may suspend all payments or seek appropriate relief (including, without limitation, instructions from the Requisite Lenders or an action in the nature of interpleader) in the event of any doubt or dispute as to any apportionment or distribution contemplated hereby. (v) In the event that any Lender fails to fund its Pro Rata Share of any Loan requested by the Borrower which such Lender is obligated to fund under the terms of this Agreement (the funded portion of such Loan being hereinafter referred to as a "Non Pro Rata Loan"), then until the earlier of such Lender's cure of such failure and the termination of the Revolving Credit Commitments, the proceeds of all amounts thereafter repaid to the Administrative Agent by the Borrower and otherwise required to be applied to such Lender's share of all other Obligations pursuant to the terms of this Agreement shall be advanced to the Borrower by the Administrative Agent on behalf of such Lender to cure, in full or in part, such failure by such Lender, but shall nevertheless be deemed to have been paid to such Lender in satisfaction of such other Obligations. Notwithstanding anything in this Agreement to the contrary: (A) the foregoing provisions of this Section 4.2(b)(v) shall apply only with respect to the proceeds of payments of Obligations and shall not affect the conversion or continuation of Loans pursuant to Section 5.1(c); (B) a Lender shall be deemed to have cured its failure to fund its Pro Rata Share of any Loan (without waiver by the Borrower, the Administrative Agent or any Lender of any claim against such Lender arising as a consequence of such failure) at such time as an amount equal to such Lender's original Pro Rata Share of the requested principal portion of such Loan is fully funded to the Borrower, whether made by such Lender itself or by operation of the terms of this Section 4.2(b)(v), and whether or not the Non Pro Rata Loan with respect thereto has been repaid, converted or continued; 33 (C) amounts advanced to the Borrower to cure, in full or in part, any such Lender's failure to fund its Pro Rata Share of any Loan ("Cure Loans") shall bear interest at the same rate as, and for all other purposes of this Agreement shall be treated as if they were Loans similar to, the advances that would have been made had such Lender advanced its Pro Rata Share of the requested Borrowing; and (D) regardless of whether or not an Event of Default has occurred or is continuing, and notwithstanding the instructions of the Borrower as to its desired application, all repayments of principal which, in accordance with the other terms of this Section 4.2, would be applied to the outstanding Base Rate Loans shall be applied first, ratably to all Base Rate Loans constituting Non Pro Rata Loans, second, ratably to Base Rate Loans other than those constituting Non Pro Rata Loans or Cure Loans and, third, ratably to Base Rate Loans constituting Cure Loans. (c) Payments on Non-Business Days. Whenever any payment to be made by the Borrower hereunder or under the Notes is stated to be due on a day which is not a Business Day, the payment shall instead be due on the next succeeding Business Day (or, if required pursuant to Section 5.2(b)(iii), the next preceding Business Day). 4.3 Promise to Repay; Evidence of Indebtedness. (a) Promise to Repay. The Borrower hereby agrees to pay when due the principal amount of each Loan which is made to it, and further agrees to pay all unpaid interest accrued thereon, in accordance with the terms of this Agreement and the Notes. The Borrower shall execute and deliver to each Lender on the Closing Date, a Note evidencing the Loans owing or which may become owing to such Lender, and thereafter shall execute and deliver such other Notes as are necessary to evidence the Loans owing to the Lenders after giving effect to any Assignment and Acceptance pursuant to Section 15.1, any Joinder Agreement pursuant to Section 3.2 and any Addendum pursuant to Section 3.3 hereof, all in form and substance acceptable to the Administrative Agent and the parties to such Assignment and Acceptance, Joinder Agreement or Addendum, as applicable. (b) Loan Account. Each Lender shall maintain in accordance with its usual practice an account or accounts (a "Loan Account") evidencing the Indebtedness of the Borrower to such Lender resulting from each Loan owing to such Lender from time to time, including, without limitation, the amount of principal and interest payable and paid to such Lender from time to time hereunder and under the Notes. (c) Control Account. The Register maintained by the Administrative Agent pursuant to Section 15.1(c) shall include a control account, and a subsidiary account for each Lender, in which accounts (taken together) shall be recorded (i) the date and amount of each Borrowing made hereunder, the type of Loans comprising such Borrowing and any Eurodollar Interest Period applicable thereto, (ii) the effective date and amount of each Assignment and Acceptance, Joinder Agreement and Addendum delivered to and accepted by it and the parties thereto, (iii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder or under the Notes and (iv) the amount of 34 any sum received by the Administrative Agent from the Borrower hereunder and each Lender's share thereof. (d) Entries Binding. The entries made in the Register and each Loan Account shall be conclusive and binding for all purposes, absent manifest error. ARTICLE V - INTEREST AND FEES 5.1 Interest on the Loans and Other Obligations. (a) Rate of Interest. All Loans and the outstanding principal balance of all other Obligations shall bear interest on the unpaid principal amount thereof from the date such Loans are made and such other Obligations are due and payable until paid in full, except as otherwise provided in Section 5.1(d), as follows: (i) If a Base Rate Loan or an Obligation other than a Eurodollar Rate Loan, at a rate per annum equal to the sum of (A) the Base Rate, as in effect from time to time as interest accrues, plus (B) the then Applicable Margin for Base Rate Loans; and (ii) If a Eurodollar Rate Loan, at a rate per annum equal to the sum of (A) the Eurodollar Rate determined for the applicable Eurodollar Interest Period, plus (B) the then Applicable Margin for Eurodollar Rate Loans. The applicable basis for determining the rate of interest on the Loans shall be selected by the Borrower at the time a Notice of Borrowing or a Notice of Conversion/Continuation is delivered by the Borrower to the Administrative Agent; provided, however, that the Borrower may not select the Eurodollar Rate as the applicable basis for determining the rate of interest on such a Loan if at the time of such selection an Event of Default has occurred and is continuing or an Event of Default would occur as a result of such selection; and provided further that the Borrower may not select the Eurodollar Rate for a Eurodollar Interest Period of more than thirty (30) days if at the time of such selection a Potential Event of Default has occurred and is continuing or a Potential Event of Default would occur as a result of such selection; and provided further that from and after the occurrence of an Event of Default, each Eurodollar Rate Loan then outstanding shall, at the Administrative Agent's option, convert to a Base Rate Loan. If on any day any Loan is outstanding with respect to which notice has not been timely delivered to the Administrative Agent in accordance with the terms of this Agreement specifying the basis for determining the rate of interest on that day, then for that day interest on that Loan shall be determined by reference to the Base Rate. (b) Interest Payments. (i) Interest accrued on each Loan, whether a Base Rate Loan or a Eurodollar Rate Loan, shall be calculated on the last day of each calendar month and shall be payable in arrears (A) on the first day of each calendar month with respect to a Base Rate Loan or Eurodollar Rate Loan, commencing on the first such day following the making of such Loan, (B) upon the payment or prepayment thereof in full or in part, and (C) if not previously paid in full, at maturity (whether by acceleration or otherwise) of such Loan. 35 (ii) Interest accrued on the principal balance of all other Obligations shall be calculated on the last day of each calendar month and shall be payable in arrears (A) on the first day of each calendar month, commencing on the first such day following the accrual of such Obligation, (B) upon repayment thereof in full or in part, and (C) if not previously paid in full, at the time such other Obligation becomes due and payable (whether by acceleration or otherwise). (c) Conversion or Continuation. (i) The Borrower shall have the option (A) to convert at any time all or any part of outstanding Base Rate Loans to Eurodollar Rate Loans; (B) to convert all or any part of outstanding Eurodollar Rate Loans having Eurodollar Interest Periods which expire on the same date to Base Rate Loans on such expiration date; or (C) to continue all or any part of outstanding Eurodollar Rate Loans having Eurodollar Interest Periods which expire on the same date as Eurodollar Rate Loans, and the succeeding Eurodollar Interest Period of such continued Loans shall commence on such expiration date; provided, however, no such outstanding Loan may be continued as, or be converted into, a Eurodollar Rate Loan (i) if such continuation or conversion would violate any of the provisions of Section 5.2 or (ii) if an Event of Default has occurred and is continuing or an Event of Default would occur as a result of such continuation or conversion; and provided further no such outstanding Loan may be continued as, or be converted into, a Eurodollar Rate Loan having a Eurodollar Interest Period of more than thirty (30) days, if a Potential Event of Default has occurred and is continuing or a Potential Event of Default would occur as a result of such continuation or conversion. Any conversion into or continuation of Eurodollar Rate Loans under this Section 5.1(c) shall be in a minimum amount of $2,000,000 and in integral multiples of $1,000,000 in excess of that amount, except in the case of a conversion or continuation of an entire Borrowing of Non Pro Rata Loans. (ii) To convert or continue a Loan under Section 5.1(c)(i), the Borrower shall deliver a Notice of Conversion/Continuation to the Administrative Agent no later than 11:00 a.m. (Chicago time) at least three (3) Business Days in advance of the proposed conversion/continuation date. A Notice of Conversion/Continuation shall specify (A) the proposed conversion/continuation date (which shall be a Business Day), (B) the principal amount of the Loan to be converted/continued, (C) whether such Loan shall be converted and/or continued, and (D) in the case of a conversion to, or continuation of, a Eurodollar Rate Loan, the requested Eurodollar Interest Period. In lieu of delivering a Notice of Conversion/Continuation, the Borrower may give the Administrative Agent telephonic notice of any proposed conversion/continuation by the time required under this Section 5.1(c)(ii), if the Borrower confirms such notice by delivery of the Notice of Conversion/Continuation to the Administrative Agent by facsimile transmission promptly, but in no event later than 12:00 noon (Chicago time) on the same day. Promptly after receipt of a Notice of Conversion/Continuation under this Section 5.1(c)(ii) (or telephonic notice in lieu thereof), the Administrative Agent shall notify each Lender by facsimile transmission, or other similar form of transmission, of the proposed conversion/continuation. Any Notice of Conversion/Continuation for conversion to, or continuation of, a Loan (or telephonic notice in lieu thereof) given pursuant to this Section 5.1(c)(ii) shall be irrevocable, and the Borrower shall be bound to convert or continue in accordance therewith. In the event no Notice of Conversion/Continuation is delivered as and 36 when specified in this Section 5.1(c)(ii) with respect to outstanding Eurodollar Rate Loans, upon the expiration of the Eurodollar Interest Period applicable thereto, such Loans shall automatically be continued as Eurodollar Rate Loans with a Eurodollar Interest Period of thirty (30) days. (d) Default Interest. Notwithstanding the rates of interest specified in Section 5.1(a) or elsewhere in this Agreement, effective immediately upon the occurrence of an Event of Default, and for as long thereafter as such Event of Default shall be continuing, the principal balance of all Loans and other Obligations shall bear interest at a rate equal to the sum of (A) the Base Rate, as in effect from time to time as interest accrues, plus (B) three percent (3.0%) per annum. (e) Computation of Interest. Interest on all Obligations shall be computed on the basis of the actual number of days elapsed in the period during which interest accrues and a year of 360 days. In computing interest on any Loan, the date of the making of the Loan or the first day of a Eurodollar Interest Period, as the case may be, shall be included and the date of payment or the expiration date of a Eurodollar Interest Period, as the case may be, shall be excluded; provided, however, if a Loan is repaid on the same day on which it is made, one (1) day's interest shall be paid on such Loan. (f) Eurodollar Rate Information. Upon the reasonable request of the Borrower from time to time, the Administrative Agent shall promptly provide to the Borrower such information with respect to the applicable Eurodollar Rate as may be so requested. 5.2 Special Provisions Governing Eurodollar Rate Loans. (a) Amount of Eurodollar Rate Loans. Each Eurodollar Rate Loan shall be in a minimum principal amount of $2,000,000 and in integral multiples of $1,000,000 in excess of that amount. (b) Determination of Eurodollar Interest Period. By giving notice as set forth in Section 2.1(b) (with respect to a Borrowing of Eurodollar Rate Loans) or Section 5.1(c) (with respect to a conversion into or continuation of Eurodollar Rate Loans), the Borrower shall have the option, subject to the other provisions of this Section 5.2, to select an interest period (each, a "Eurodollar Interest Period") to apply to the Loans described in such notice, subject to the following provisions: (i) The Borrower may only select, as to a particular Borrowing of Eurodollar Rate Loans, a Eurodollar Interest Period of one, two, three or six months in duration or, with the prior written consent of the Administrative Agent, a shorter or a longer duration; (ii) In the case of immediately successive Eurodollar Interest Periods applicable to a Borrowing of Eurodollar Rate Loans, each successive Eurodollar Interest Period shall commence on the day on which the next preceding Eurodollar Interest Period expires; (iii) If any Eurodollar Interest Period would otherwise expire on a day which is not a Business Day, such Eurodollar Interest Period shall be extended to expire on the 37 next succeeding Business Day, if the next succeeding Business Day occurs in the same calendar month, and, if there will be no succeeding Business Day in such calendar month, the Eurodollar Interest Period shall expire on the immediately preceding Business Day; (iv) The Borrower may not select a Eurodollar Interest Period as to any Loan if such Eurodollar Interest Period terminates later than the Revolving Credit Termination Date; and (v) There shall be no more than six (6) Eurodollar Rate Loans outstanding at any one time. (c) Determination of Eurodollar Interest Rate. As soon as practicable on the second Business Day prior to the first day of each Eurodollar Interest Period (the "Eurodollar Interest Rate Determination Date"), the Administrative Agent shall determine (pursuant to the procedures set forth in the definition of Eurodollar Rate) the interest rate which shall apply to the Eurodollar Rate Loans for which an interest rate is then being determined for the applicable Eurodollar Interest Period and shall promptly give notice thereof (in writing or by telephone confirmed in writing) to the Borrower and to each Lender. The Administrative Agent's determination shall be presumed to be correct, absent manifest error, and shall be binding upon the Borrower. (d) Interest Rate Unascertainable Inadequate or Unfair. In the event that at least one (1) Business Day before the Eurodollar Interest Rate Determination Date: (i) the Administrative Agent determines that deposits in Dollars are not generally being offered in the London interbank market for such Eurodollar Interest Period; or (ii) the Administrative Agent determines that adequate and fair means do not exist for ascertaining the applicable interest rates by reference to which the Eurodollar Rate then being determined is to be fixed; or (iii) the Requisite Lenders advise the Administrative Agent that the Eurodollar Rate for Eurodollar Rate Loans comprising such Borrowing will not adequately reflect the cost to such Requisite Lenders of obtaining funds in Dollars in the London interbank market in the amount substantially equal to such Lenders' Eurodollar Rate Loans in Dollars and for a period equal to such Eurodollar Interest Period; then the Administrative Agent shall forthwith give notice thereof to the Borrower, whereupon (until the Administrative Agent notifies the Borrower that the circumstances giving rise to such suspension no longer exist) the right of the Borrower to elect to have Loans bear interest based upon the Eurodollar Rate shall be suspended and each outstanding Eurodollar Rate Loan shall be converted into a Base Rate Loan on the last day of the then current Eurodollar Interest Period therefor, notwithstanding any prior election by the Borrower to the contrary. (e) Illegality. 38 (i) If at any time any Lender determines (which determination shall, absent manifest error, be final and conclusive and binding upon all parties) that the making or continuation of any Eurodollar Rate Loan has become unlawful or impermissible by compliance by that Lender with any law, governmental rule, regulation or order of any Governmental Authority (whether or not having the force of law and whether or not failure to comply therewith would be unlawful or would result in costs or penalties), then, and in any such event, such Lender may give notice of that determination, in writing, to the Borrower and the Administrative Agent, and the Administrative Agent shall promptly transmit the notice to each other Lender. (ii) When notice is given by a Lender under Section 5.2(e)(i), (A) the Borrower's right to request from such Lender and such Lender's obligation, if any, to make Eurodollar Rate Loans shall be immediately suspended, and such Lender shall make a Base Rate Loan as part of any requested Borrowing of Eurodollar Rate Loans and (B) if the affected Eurodollar Rate Loan or Loans are then outstanding, the Borrower shall immediately, or if permitted by applicable law, no later than the date permitted thereby, upon at least one (1) Business Day's prior written notice to the Administrative Agent and the affected Lender, convert each such Loan into a Base Rate Loan. (iii) If at any time after a Lender gives notice under Section 5.2(e)(i) such Lender determines that it may lawfully make Eurodollar Rate Loans, such Lender shall promptly give notice of that determination, in writing, to the Borrower and the Administrative Agent, and the Administrative Agent shall promptly transmit the notice to each other Lender. The Borrower's right to request, and such Lender's obligation, if any, to make Eurodollar Rate Loans shall thereupon be restored. (iv) Notwithstanding the foregoing, in the event that any Lender gives such a notice, at Borrower's sole election, Borrower may identify an Eligible Assignee to whom the Lender which has given such a notice shall assign its interest in the Loans pursuant to the terms of an Assignment and Acceptance substantially in the form attached as Exhibit A. (f) Compensation. In addition to all amounts required to be paid by the Borrower pursuant to Section 5.1 and Article XIII, the Borrower shall compensate each Lender, upon demand, for all losses, expenses and liabilities (including, without limitation, any loss or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Lender to fund or maintain such Lender's Eurodollar Rate Loans to the Borrower but excluding any loss of Applicable Margin on the relevant Loans and losses or expenses incurred as the result of such Lender's gross negligence or willful misconduct) which that Lender may sustain (i) if for any reason a Borrowing, conversion into or continuation of Eurodollar Rate Loans does not occur on a date specified therefor in a Notice of Borrowing or a Notice of Conversion/Continuation given by the Borrower or in a telephonic request by it for borrowing or conversion/continuation or a successive Eurodollar Interest Period does not commence after notice therefor is given pursuant to Section 5.1(c), other than such a failure resulting from the circumstances described in Section 5.2(d) or Section 5.2(e), (ii) if for any reason any Eurodollar Rate Loan is prepaid (including, without limitation, on a mandatory basis pursuant to Section 4.1(d)) on a date which is not the last day of the applicable Eurodollar Interest Period, or (iii) as a consequence of any failure by the Borrower to repay a Eurodollar 39 Rate Loan when required by the terms of this Agreement. The Lender making demand for such compensation shall deliver to the Administrative Agent concurrently with such demand, and the Administrative Agent shall promptly forward to the Borrower, a written statement setting forth in reasonable detail such losses, expenses and liabilities, and such statement shall be conclusive as to the amount of compensation due to that Lender, absent manifest error. (g) Booking of Eurodollar Rate Loans. Any Lender may make, carry or transfer Eurodollar Rate Loans at, to, or for the account of, its Eurodollar Lending Office or Eurodollar Affiliate or its other offices or Affiliates. No Lender shall be entitled, however, to receive any greater amount under Sections 4.2 or 5.2(f) or Article XIII as a result of the transfer of any such Eurodollar Rate Loan to any office (other than such Eurodollar Lending Office) or any Affiliate (other than such Eurodollar Affiliate) than such Lender would have been entitled to receive immediately prior thereto, unless (i) the transfer occurred at a time when circumstances giving rise to the claim for such greater amount did not exist and (ii) such claim would have arisen even if such transfer had not occurred. (h) Affiliates Not Obligated. No Eurodollar Affiliate or other Affiliate of any Lender shall be deemed a party to this Agreement or shall have any liability or obligation under this Agreement unless such Eurodollar Affiliate, itself, is a Lender. (i) Adjusted Eurodollar Rate. Any failure by any Lender to take into account the Eurodollar Reserve Percentage when calculating interest due on Eurodollar Rate Loans shall not constitute, whether by course of dealing or otherwise, a waiver by such Lender of its right to collect such amount for any future period. 5.3 Fees. ---- (a) Facility Fee. The Borrower shall pay to the Administrative Agent, for the account of the Lenders based on their respective Pro Rata Shares, a fee (the "Facility Fee"), accruing at a per annum rate equal to the then applicable Facility Fee Percentage on the then available Revolving Credit Commitments, such fee being payable quarterly, in arrears, commencing on October 1, 2000 and on the first day of each calendar quarter thereafter. Notwithstanding the foregoing, in the event that any Lender fails to fund its Pro Rata Share of any Loan requested by the Borrower which such Lender is obligated to fund under the terms of this Agreement, (A) such Lender shall not be entitled to any portion of the Facility Fee with respect to its Revolving Credit Commitment until such failure has been cured in accordance with Section 4.2(b)(v)(B) and (B) until such time, the Facility Fee shall accrue in favor of the Lenders which have funded their respective Pro Rata Shares of such requested Loan, shall be allocated among such performing Lenders ratably based upon their relative Revolving Credit Commitments, and shall be calculated based upon the average amount by which the aggregate Revolving Credit Commitments of such performing Lenders exceeds the sum of the outstanding principal amount of the Loans owing to such performing Lenders. (b) Calculation and Payment of Fees. All fees shall be calculated on the basis of the actual number of days elapsed during the relevant period in a 360-day year. All fees shall be payable in addition to, and not in lieu of, interest, compensation, expense reimbursements, 40 indemnification and other Obligations. Fees shall be payable to the Administrative Agent at its office in Chicago, Illinois in immediately available funds. All fees shall be fully earned and nonrefundable when paid. All fees due to any other Lender, including, without limitation, those referred to in this Section 5.3, shall bear interest, if not paid when due, at the interest rate specified in Section 5.1(d) and shall constitute Obligations. ARTICLE VI - CONDITIONS TO LOANS 6.1 Conditions Precedent to the Initial Loans. The obligation of each Lender on the Initial Funding Date to make any Loan requested to be made by it shall be subject to the satisfaction or waiver of all of the following conditions precedent: (a) Documents. The Administrative Agent shall have received, on or before the Initial Funding Date, this Agreement, the Notes, the Guaranty, all other Loan Documents and agreements, documents and instruments described in the List of Closing Documents attached hereto as Exhibit E and made a part hereof, and such additional documentation as the Administrative Agent may reasonably request, each duly executed, if applicable, by the Borrower or GGP, Inc., as appropriate, and in form and substance satisfactory to the Administrative Agent. Without limiting the foregoing, the Borrower hereby directs its counsel, Neal, Gerber & Eisenberg, to prepare and deliver to the Administrative Agent, the Lenders, and Barack Ferrazzano Kirschbaum Perlman & Nagelberg the legal opinion(s) referred to in such List of Closing Documents; and (b) No Legal Impediments. No law, regulation, order, judgment or decree of any Governmental Authority shall, and the Administrative Agent shall not have received any notice that litigation is pending or threatened which is likely to (i) enjoin, prohibit or restrain the making of the Loans on the Initial Funding Date or (ii) impose or result in the imposition of a Material Adverse Effect. (c) No Change in Condition. No change in the business, assets, management, operations, financial condition or prospects of the Borrower, GGP, Inc. or any of their respective Properties shall have occurred since March 31, 2000, which change, in the judgment of the Administrative Agent, has had, will have or is reasonably likely to have a Material Adverse Effect. (d) Interim Liabilities and Equity. Except as disclosed to the Administrative Agent and the Lenders, since March 31, 2000, the Borrower shall not have (i) entered into any material (as determined in good faith by the Administrative Agent) commitment or transaction, including, without limitation, transactions for borrowings and Capital Expenditures, which are not in the ordinary course of the Borrower's business, (ii) declared or paid any dividends or other distributions (other than the dividend anticipated to be paid on July 31, 2000), (iii) established compensation or employee benefit plans, or (iv) redeemed any equity Securities. (e) No Loss of Material Agreements and Licenses. Since March 31, 2000, no agreement or license relating to the business, operations or employee relations of the Borrower or any of its Properties shall have been terminated, modified, revoked, breached or declared to be in 41 default, the termination, modification, revocation, breach or default under which, in the reasonable judgment of the Administrative Agent, would result in a Material Adverse Effect. (f) Sharing Agreement. The Partnership and the Company shall have entered into, and delivered to the Co-Arrangers a complete and accurate copy of, a written agreement, in form and substance reasonably satisfactory to the Co- Arrangers, providing for such adjustments between the Partnership and the Company as may be necessary from time to time to assure, insofar as practicable, that each of them bears the costs and other burdens imposed on the Borrower under this Agreement and the other Loan Documents to which the Borrower is a party substantially in proportion to the loan proceeds and other benefits received and enjoyed by them, respectively, hereunder and thereunder. (g) No Default. No Event of Default or Potential Event of Default shall have occurred and be continuing or would result from the making of the Loans. (h) Representations and Warranties. All of the representations and warranties contained in Section 7.1 and in any of the other Loan Documents shall be true and correct in all material respects on and as of the Initial Funding Date (other than representations and warranties which expressly speak as to a different specific date, which shall be true and correct as of such date). (i) Fees and Expenses Paid. There shall have been paid to the Administrative Agent, for the accounts of the Administrative Agent and the other Lenders, as applicable, all fees due and payable on or before the Initial Funding Date and all expenses due and payable on or before the Initial Funding Date, including, without limitation, reasonable attorneys' fees and expenses, and other costs and expenses incurred in connection with the Loan Documents. (j) Committed Financing. The Borrower shall have: (i) obtained from lenders or investors acceptable to the Co-Arrangers, and delivered to the Co- Arrangers complete and accurate copies of, bona fide written commitments for equity or unsecured debt financing available or to be funded to the Borrower substantially contemporaneously herewith in an aggregate amount which, when added to the Revolving Credit Commitments, equals $235,000,000, the terms, conditions and pricing of which unsecured debt financing shall be acceptable to the Co-Arrangers, shall comply with the requirements of Section 10.12(h) hereof, and shall not otherwise be more favorable to the lender(s) than the terms, conditions and pricing provided for herein; (ii) delivered to the Co-Arrangers a schedule acceptable to the Administrative Agent of the Borrower's sources and uses of funds for the twelve calendar months following the date hereof; and (iii) given the Co-Arrangers reasonably detailed written notice of all other requests, proposals, expressions of interest, offers, commitments and letters of intent for unsecured debt financing given or received by or on behalf of the Borrower that is proposed first to be funded or available to the Borrower on or before the date hereof or at any time thereafter prior to the Revolving Credit Termination Date. (k) Repayment of Other Facilities. All commitments of the lenders shall have terminated, under that certain Credit Agreement dated as of January 31, 2000 among the Partnership, Dresdner, as agent and a lender thereunder, and the other lenders identified therein, 42 and Borrower shall repay in full all of its obligations thereunder immediately upon the initial funding of the Loans hereunder. (l) Covenant Calculations. The Borrower shall have delivered to the Administrative Agent pro forma calculations of the financial covenants and ratios described in Article X hereof as of the end of each of the first four calendar quarters ending after the date hereof, in form as provided in Section 8.2(a)(iii)(B) and 8.2(b)(iii)(B) hereof for such calculations and otherwise in form and substance satisfactory to the Administrative Agent. 6.2 Conditions Precedent to All Subsequent Loans. The obligation of each Lender to make any Loan requested to be made by it on any date after the Initial Funding Date is subject to the following conditions precedent as of each such date: (a) Representations and Warranties. As of such date, both before and after giving effect to the Loans to be made on such date, all of the representations and warranties of the Borrower contained in Section 7.1 and in any other Loan Document shall be true and correct in all material respects (other than representations and warranties which expressly speak as of a different date, which shall be true and correct as of such date, and other than representations and warranties with respect to which the Borrower has disclosed to the Administrative Agent in writing that the facts are not as represented therein and the Administrative Agent has approved or consented to, conditionally or otherwise, the facts as so disclosed by the Borrower). (b) No Defaults. No Event of Default or Potential Event of Default shall have occurred and be continuing or would result from the making of the requested Loan. (c) No Legal Impediments. No law, regulation, order, judgment or decree of any Governmental Authority shall, and the Administrative Agent shall not have received from any Lender notice that, in the judgment of such Lender, litigation is pending or threatened which is likely to, enjoin, prohibit or restrain, or impose or result in the imposition of any material adverse condition upon, such Lender's making the requested Loan. (d) No Material Adverse Effect. The Borrower shall not have received written notice from the Requisite Lenders that an event has occurred since the date of this Agreement which has had and continues to have, will have or is reasonably likely to have, a Material Adverse Effect. (e) Committed Financing. In the case of any Loan requested to be funded on or after November 1, 2000, the Borrower shall have obtained from lenders or investors reasonably acceptable to the Co-Arrangers, and delivered to the Co-Arrangers complete and accurate copies of, bona fide written commitments for equity or unsecured debt financing then available or to be funded to the Borrower in an aggregate amount which, when added to (i) the Revolving Credit Commitments and (ii) the commitments obtained pursuant to Section 6.1 (j) hereof, equals $275,000,000, the terms, conditions and pricing of which unsecured debt financing shall be reasonably acceptable to the Co-Arrangers, shall comply with the requirements of Section 10.12(h) hereof, and shall not otherwise be more favorable to the lender(s) than the terms, conditions and pricing provided for herein. 43 Each submission by the Borrower to the Administrative Agent of a Notice of Borrowing with respect to a Borrowing or a Notice of Conversion/Continuation with respect to any Loan and each acceptance by the Borrower of the proceeds of each Loan made, converted or continued hereunder, shall constitute a representation and warranty by the Borrower as of the Funding Date in respect of such Borrowing or Loan and the date of conversion or continuation, that all the conditions contained in this Section 6.2 have been satisfied or waived in accordance with Section 15.7. ARTICLE VII - REPRESENTATIONS AND WARRANTIES 7.1 Representations and Warranties of the Borrower. In order to induce the Lenders to enter into this Agreement and to make the Loans and the other financial accommodations to the Borrower described herein, the Borrower hereby represents and warrants to each Lender that the following statements are true, correct and complete: (a) Organization; Powers. (i) The Partnership (A) is a limited partnership duly formed, validly existing and in good standing under the laws of the State of Delaware, (B) is duly qualified to do business and is in good standing under the laws of each jurisdiction in which failure to be so qualified and in good standing will have or is reasonably likely to have a Material Adverse Effect, (C) has all requisite partnership power and authority to own, operate and encumber its Property and to conduct its business as presently conducted and as proposed to be conducted in connection with and following the consummation of the transactions contemplated by this Agreement and (D) is a partnership for federal income tax purposes. (ii) The Company (A) is a Delaware limited liability company duly formed, validly existing and in good standing under the laws of the State of Delaware, (B) is duly qualified to do business and is in good standing under the laws of each jurisdiction in which failure to be so qualified and in good standing will have or is reasonably likely to have a Material Adverse Effect, (C) has all requisite limited liability company power and authority to own, operate and encumber its Property and to conduct its business as presently conducted and as proposed to be conducted in connection with and following the consummation of the transactions contemplated by this Agreement and (D) is a partnership for federal income tax purposes. The Partnership is member of the Company, having an interest in the Company as set forth in Schedule 7.1-A-1 attached hereto. The only other members of the Company are Goldman Sachs 2000 Exchange Place Fund, L.P. (a limited partnership of which Goldman, Sachs or an entity controlled thereby is the sole general partner), Caledonian Holding Company, Inc. (a corporation which is an Affiliate of the Partnership), and GGP American Properties Inc. (a corporation which is an Affiliate of the Partnership), each having an interest in the Company as set forth in Schedule 7.1-A-1 attached hereto. (iii) GGP, Inc. (A) is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware, (B) is duly authorized and qualified to do business and is in good standing under the laws of each jurisdiction in which failure to be so qualified and in good standing will have or is reasonably likely to have a Material Adverse 44 Effect, and (C) has all requisite corporate power and authority to own, operate and encumber its Property and to conduct its business as presently conducted. (iv) True, correct and complete copies of the Organizational Documents identified on Schedule 7.1-A have been delivered to the Administrative Agent, each of which is in full force and effect, has not been modified or amended except to the extent indicated therein and, to the best of the Borrower's knowledge, there are no defaults under such Organizational Documents and no events which, with the passage of time or giving of notice or both, would constitute a default under such Organizational Documents. (v) Neither Borrower nor any of its Affiliates are "foreign persons" within the meaning of Section 1445 of the Internal Revenue Code. (b) Authority. --------- (i) The Partnership is the sole managing member of the Company, and no other member of the Company has any decision-making authority in connection with the business, assets, liabilities, operations or other affairs of the Company. GGP, Inc. is the sole general partner of the Partnership. (ii) GGP, Inc., (A) in its capacity as the sole general partner of the Partnership, in respect of the Partnership, and (B) in its capacity as the sole general partner of the Partnership, in the Partnership's capacity as the sole managing member of the Company, in respect of the Company, has the requisite power and authority to execute, deliver and perform this Agreement on behalf of the Borrower and each of the other Loan Documents which are required to be executed on behalf of the Borrower as required by this Agreement. GGP, Inc. is the Person who has executed this Agreement and such other Loan Documents on behalf of the Borrower. (iii) The execution, delivery and performance of each of the Loan Documents which must be executed in connection with this Agreement by the Borrower and to which the Borrower is a party and the consummation of the transactions contemplated thereby are within the Partnership's partnership powers and the Company's limited liability company powers, have been duly authorized by all necessary partnership action or limited liability action, as applicable (and, in the case of GGP, Inc. acting on behalf of the Borrower in connection therewith, all necessary corporate action thereof) and such authorization has not been rescinded. No other partnership, limited liability company or corporate action or proceedings on the part of the Borrower or GGP, Inc. is necessary to consummate such transactions. (iv) Each of the Loan Documents to which the Borrower is a party has been duly executed and delivered on behalf of the Borrower and constitutes the Borrower's legal, valid and binding obligation, enforceable against the Borrower in accordance with its terms (except to the extent that the enforcement thereof or the availability of equitable remedies may be limited by applicable bankruptcy, reorganization, insolvency, moratorium, fraudulent transfer, fraudulent conveyance or similar laws now or hereafter in effect relating to or affecting creditors' rights generally or by general principles of equity, or by the discretion of any court in awarding equitable remedies, regardless of whether such enforcement is considered in a preceding in 45 equity or at law), is in full force and effect and all the terms, provisions, agreements and conditions set forth therein and required to be performed or complied with by the Borrower on or before the Initial Funding Date have been performed or complied with, and no Potential Event of Default, Event of Default or breach of any covenant by the Borrower exists thereunder. (c) Subsidiaries; Ownership of Capital Stock and Partnership Interests. (i) Schedule 7.1-C (A) contains a diagram indicating the structure of the Borrower, and any other Person in which the Borrower holds a direct or indirect partnership, membership, joint venture or other equity interest, indicating the nature of such interest with respect to each Person included in such diagram; and (B) accurately sets forth (1) the correct legal name of such Person, the jurisdiction of its incorporation or organization and the jurisdictions in which it is qualified to transact business as a foreign corporation, or otherwise, and (2) the authorized, issued and outstanding shares or interests of each class of Securities representing equity interests of the Borrower and the owners of such shares or interests. None of such issued and outstanding Securities is subject to any vesting, redemption, or repurchase agreement, and there are no warrants or options outstanding with respect to such Securities, except as noted on Schedule 7.1-C. (ii) The outstanding Capital Stock issued by GGP, Inc. is duly authorized, validly issued, fully paid and nonassessable and the outstanding Securities issued by the Borrower and, to the extent owned by Borrower, its Subsidiaries are duly authorized and validly issued. The Borrower has previously delivered the Administrative Agent a true, accurate and complete copy of the Borrower Partnership Agreement and the Borrower Operating Agreement, each as amended through and as in effect on the Closing Date, and neither the Borrower Partnership Agreement nor the Borrower Operating Agreement has been amended, supplemented, replaced, restated or otherwise modified in any respect since the Closing Date. (iii) Except where failure may not have a Material Adverse Effect on the Borrower, each Subsidiary: (A) is a corporation, limited liability company, trust or partnership, as indicated on Schedule 7.1-C, duly organized or formed, validly existing and, if applicable, in good standing under the laws of the jurisdiction of its organization; (B) is duly qualified to do business and, if applicable, is in good standing under the laws of each jurisdiction in which failure to be so qualified and in good standing would limit its ability to use the courts of such jurisdiction to enforce Contractual Obligations to which it is a party; and (C) has all requisite power and authority to own, operate and encumber its Property and to conduct its business as presently conducted and as proposed to be conducted hereafter. (d) No Conflict. The execution, delivery and performance of each of the Loan Documents to which the Borrower is a party do not and will not (i) conflict with the Organizational Documents of the Borrower, (ii) constitute a tortious interference with any Contractual Obligation of any Person or conflict with, result in a breach of or constitute (with or without notice or lapse of time or both) a default under any Requirement of Law or Contractual Obligation of the Borrower, or require termination of any such Contractual Obligation which may subject the Administrative Agent or any of the other Lenders to any liability or which is reasonably likely to have a Material Adverse Affect, (iii) result in or require the creation or 46 imposition of any Lien whatsoever upon any of the Property or assets of the Borrower or any Subsidiary of the Borrower, or (iv) require any approval of shareholders of GGP, Inc. (e) Governmental Consents. The execution, delivery and performance of each of the Loan Documents to which the Borrower is a party do not and will not require any registration with, consent or approval of, or notice to, or other action to, with or by any Governmental Authority, except filings, consents or notices which have been made, obtained or given. (f) Governmental Regulation. Neither the Borrower nor GGP, Inc. is subject to regulation under the Public Utility Holding Company Act of 1935, the Federal Power Act, the Interstate Commerce Act, or the Investment Company Act of 1940, or any other federal or state statute or regulation which limits its ability to incur indebtedness or its ability to consummate the transactions contemplated by this Agreement. (g) Financial Position. Complete and accurate copies of the following financial statements and materials have been delivered to the Administrative Agent: (i) annual audited financial statements of GGP,Inc. and its Consolidated Subsidiaries for the fiscal year ended December 31, 1999, and (ii) quarterly financial statements for the Borrower and its Consolidated Subsidiaries for the fiscal quarter ending March 31, 2000. All financial statements included in such materials were prepared in all material respects in conformity with GAAP, except as otherwise noted therein, and fairly present in all material respects the respective Consolidated financial positions, and the Consolidated results of operations and cash flows for each of the periods covered thereby of GGP, Inc. or the Borrower, as applicable, and its Consolidated Subsidiaries as at the respective dates thereof. Neither the Borrower nor any of its Consolidated Subsidiaries has any Contingent Obligation, contingent liability or liability for any taxes, long-term leases or commitments, not reflected in its audited financial statements delivered to the Administrative Agent on or prior to the Closing Date or otherwise disclosed to the Administrative Agent and the Lenders in writing, which will have or is reasonably likely to have a Material Adverse Effect. (h) Indebtedness. Schedule 7.1-H sets forth, as of June 30, 2000, all Indebtedness for borrowed money of each of the Borrower and its respective Subsidiaries and, except as set forth on Schedule 7.1-H, there are no defaults in the payment of principal or interest on any such Indebtedness and no payments thereunder have been deferred or extended beyond their stated maturity and there has been no material change in the type or amount of such Indebtedness (except for the repayment or refinance of certain Indebtedness) since June 30, 2000. (i) Litigation: Adverse Effects. Except as set forth in Schedule 7.1- I, as of the Closing Date, there is no action, suit, proceeding, Claim, investigation or arbitration before or by any Governmental Authority or private arbitrator pending or, to the knowledge of the Borrower, threatened against the Borrower, or any of their respective Subsidiaries, or any Property of any of them (i) challenging the validity or the enforceability of any of the Loan Documents, (ii) which will or is reasonably likely to result in any Material Adverse Effect, or (iii) under the Racketeering Influenced and Corrupt Organizations Act or any similar federal or state statute where such Person is a defendant in a criminal indictment that provides for the forfeiture of 47 assets to any Governmental Authority as a potential criminal penalty. There is no material loss contingency within the meaning of GAAP which has not been reflected in the Consolidated financial statements of the Borrower. None of the Borrower or any Subsidiary of the Borrower is (A) in violation of any applicable Requirements of Law, which violation has had, will have or is reasonably likely to have a Material Adverse Effect, or (B) subject to or in default with respect to any final judgment, writ, injunction, restraining order or order of any nature, decree, rule or regulation of any court or Governmental Authority which has had, will have or is reasonably likely to have a Material Adverse Effect. (j) No Material Adverse Effect. Since March 31, 2000, there has occurred no event which has had, will have or is reasonably likely to have a Material Adverse Effect. (k) Tax Examinations. All deficiencies which have been asserted against the Borrower as a result of any federal, state, local or foreign tax examination for each taxable year in respect of which an examination has been conducted have been fully paid or finally settled or are being contested in good faith, and no issue has been raised in any such examination which, by application of similar principles, reasonably can be expected to result in assertion of a material deficiency for any other year not so examined which has not been reserved for in the financial statements of the Borrower to the extent, if any, required by GAAP. The Borrower has not taken any reporting positions for which it does not have a reasonable basis nor does the Borrower anticipate any further material tax liability with respect to the years which have not been closed pursuant to applicable law. (l) Payment of Taxes. All tax returns, reports and similar statements or filings of the Borrower and its Subsidiaries required to be filed have been timely filed, and, except for Customary Permitted Liens, all taxes, assessments, fees and other charges of Governmental Authorities thereupon and upon or relating to their respective Properties, assets, receipts, sales, use, payroll, employment, income, licenses and franchises which are shown in such returns or reports to be due and payable have been paid, except to the extent (i) such taxes, assessments, fees and other charges of Governmental Authorities are being contested in good faith by an appropriate proceeding diligently pursued as permitted by the terms of Section 9.4 and (ii) such taxes, assessments, fees and other charges of Governmental Authorities pertain to Property of the Borrower or any of its Subsidiaries and the nonpayment of the amounts thereof would not, individually or in the aggregate, result in a Material Adverse Effect. All other taxes (including, without limitation, real estate taxes), assessments, fees and other governmental charges upon or relating to the respective Properties of the Borrower and its Subsidiaries which are due and payable have been paid, except for Customary Permitted Liens and except to the extent described in clauses (i) and (ii) above. The Borrower has no knowledge of any proposed tax assessment against the Borrower, any of their respective Subsidiaries, or any of their respective Properties that, if not paid, will have or is reasonably likely to have a Material Adverse Effect. (m) Performance. Neither the Borrower nor any of its Subsidiaries has received any notice, citation or allegation, nor has actual knowledge, that (i) it is in default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any Contractual Obligation applicable to it, (ii) any of its Properties is in violation of 48 any Requirements of Law or (iii) any condition exists which, with the giving of notice or the lapse of time or both, would constitute a default with respect to any such Contractual Obligation, in each case, except where such default or defaults, if any, has not had, will not have and is not reasonably likely to have a Material Adverse Effect. (n) Disclosure. The representations and warranties of the Borrower contained in the Loan Documents, and all certificates and other documents delivered to the Administrative Agent pursuant to the terms thereof, do not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained herein or therein, in light of the circumstances under which they were made, not misleading. The Borrower has not intentionally withheld any fact from the Administrative Agent or the other Lenders in regard to any matter which will have or is reasonably likely to have a Material Adverse Effect. Notwithstanding the foregoing, the Lenders acknowledge that the Borrower does not have liability under this clause (n) with respect to its projections of future events. (o) Requirements of Law. The Borrower and each of its Subsidiaries is in compliance in all material respects with all Requirements of Law applicable to it and its respective businesses and Properties, in each case where the failure to so comply individually or in the aggregate will have or is reasonably likely to have a Material Adverse Effect. (p) Environmental Matters. (i) Except as disclosed on Schedule 7.1-P and except where failure is not reasonably likely to have a Material Adverse Effect: (A) the operations of the Borrower, each of its Subsidiaries, and their respective Properties comply in all material respects with all applicable Environmental, Health or Safety Requirements of Law; (B) the Borrower and each of its Subsidiaries have obtained all material environmental, health and safety Permits necessary for their respective operations, and all such Permits are in good standing and the holder of each such Permit is currently in compliance in all material respects with all material terms and conditions of such Permits; (C) none of the Borrower or any of its Subsidiaries or any of their respective present or, to the Borrower's knowledge, past Property or operations is subject to or is the subject of any investigation, judicial or administrative proceeding, order, judgment, decree, dispute, negotiations, agreement or settlement respecting (1) any Environmental, Health or Safety Requirements of Law, (2) any Remedial Action, (3) any Claims or Liabilities and Costs arising from the Release or threatened Release of a Contaminant into the environment, or (4) any violation of or liability under any Environmental, Health or Safety Requirement of Law; (D) none of Borrower or any of its Subsidiaries has filed any notice under any applicable Requirement of Law (1) reporting a Release of a Contaminant; (2) indicating past or present treatment, storage or disposal of a hazardous waste, as that term is 49 defined under 40 C.F.R. Part 261 or any state equivalent; or (3) reporting a violation of any applicable Environmental, Health or Safety Requirement of Law; (E) none of the Borrower's or any of its Subsidiaries' present or, to Borrower's knowledge, past Property presently is listed or proposed for listing on the National Priorities List ("NPL") pursuant to CERCLA or on the Comprehensive Environmental Response Compensation Liability Information System List ("CERCLIS") or any similar state list of sites requiring Remedial Action; (F) neither the Borrower nor any of its Subsidiaries has sent or directly arranged for the transport of any waste to any site listed or proposed for listing on the NPL, CERCLIS or any similar state list; (G) to the best of the Borrower's knowledge, there is not now, and to Borrower's knowledge there has never been on or in any Real Property of the Borrower or any of its Subsidiaries (1) any treatment, recycling, storage or disposal of any hazardous waste, as that term is defined under 40 C.F.R. Part 261 or any state equivalent; (2) any landfill, waste pile, or surface impoundment; (3) any underground storage tanks the presence or use of which is or, to Borrower's knowledge, has been in violation of applicable Environmental, Health or Safety Requirements of Law, (4) any asbestos-containing material which Borrower has any reason to believe could subject the Borrower, any of its Subsidiaries or any of their respective Properties to Liabilities and Costs arising out of or relating to environmental, health or safety matters that would result in a Material Adverse Effect; or (5) any polychlorinated biphenyls (PCB) used in hydraulic oils, electrical transformers or other Equipment which the Borrower has any reason to believe could subject the Borrower, any of its Subsidiaries or any of their respective Properties to Liabilities and Costs arising out of or relating to environmental, health or safety matters that would result in a Material Adverse Effect; (H) neither the Borrower nor any of its Subsidiaries has received any notice or Claim to the effect that any of the Borrower or its Subsidiaries is or may be liable to any Person as a result of the Release or threatened Release of a Contaminant into the environment; (I) to the Borrower's knowledge, neither the Borrower nor any of its Subsidiaries has any contingent liability in connection with any Release or threatened Release of any Contaminants into the environment; (J) no Environmental Lien is presently recorded with respect to any Property of the Borrower or any Subsidiary of the Borrower; (K) no Property of the Borrower or any Subsidiary of the Borrower is subject to any Environmental Property Transfer Act, or to the extent such acts are applicable to any such Property, the Borrower and/or such Subsidiary whose Property is subject thereto has fully complied with the requirements of such acts; and (L) neither the Borrower nor any of its Subsidiaries owns or operates, or, to the Borrower's knowledge, has ever owned or operated, any underground storage tank, the 50 presence or use of which is or has been in violation of applicable Environmental, Health or Safety Requirements of Law, at any Real Property. (ii) the Borrower and each of its Subsidiaries are conducting and will continue to conduct their respective businesses and operations and maintain each Real Property in compliance in all material respects with applicable Environmental, Health or Safety Requirements of Law and neither the Borrower nor any of its Subsidiaries has been or has any reason to believe that it or any of its Property will be, subject to Liabilities and Costs arising out of or relating to environmental, health or safety matters that would result in a Material Adverse Effect. (q) ERISA. Neither the Borrower nor any ERISA Affiliate maintains or contributes to any Benefit Plan or Multiemployer Plan other than those listed on Schedule 7.1-Q hereto. Each Plan which is intended to be qualified under Section 401(a) of the Internal Revenue Code as currently in effect has been determined by the IRS to be so qualified, and each trust related to any such Plan has been determined to be exempt from federal income tax under Section 501(a) of the Internal Revenue Code as currently in effect. Except as disclosed in Schedule 7.1-Q, neither the Borrower nor any of its Subsidiaries maintains or contributes to any "employee welfare benefit plan" within the meaning of Section 3(1) of ERISA which provides benefits to employees after termination of employment other than as required by Section 601 of ERISA. The Borrower and each of its Subsidiaries is in compliance in all material respects with the responsibilities, obligations and duties imposed on it by ERISA, the Internal Revenue Code and regulations promulgated thereunder with respect to all Plans. No Benefit Plan has incurred any accumulated funding deficiency (as defined in Sections 302(a)(2) of ERISA and 412(a) of the Internal Revenue Code) whether or not waived. Neither the Borrower nor any ERISA Affiliate nor any fiduciary of any Plan which is not a Multiemployer Plan (i) has engaged in a nonexempt prohibited transaction described in Sections 406 of ERISA or 4975 of the Internal Revenue Code with respect to which the Borrower can be subject to any liability or (ii) has taken or failed to take any action which would constitute or result in an ERISA Termination Event. Neither the Borrower nor any ERISA Affiliate is subject to any liability under Sections 4063, 4064, 4069, 4204 or 4212(c) of ERISA. Neither the Borrower nor any ERISA Affiliate has incurred any liability to the PBGC which remains outstanding other than the payment of premiums, and there are no premium payments which have become due which are unpaid. Schedule B to the most recent annual report filed with the IRS (i.e. IRS Form 5500) with respect to each Benefit Plan and furnished to the Administrative Agent is complete and accurate in all material respects. Since the date of each such Schedule B, there has been no material adverse change in the funding status or financial condition of the Benefit Plan relating to such Schedule B. Neither the Borrower nor any ERISA Affiliate has (i) failed to make a required contribution or payment to a Multiemployer Plan or (ii) made a complete or partial withdrawal under Sections 4203 or 4205 of ERISA from a Multiemployer Plan. Neither the Borrower nor any ERISA Affiliate has failed to make a required installment or any other required payment under Section 412 of the Internal Revenue Code on or before the due date for such installment or other payment. Neither the Borrower nor any ERISA Affiliate is required to provide security to a Benefit Plan under Section 401(a)(29) of the Internal Revenue Code due to a Benefit Plan amendment that results in an increase in current liability for the plan year. Except as disclosed on Schedule 7.1-Q, neither the Borrower nor any of its Subsidiaries has, by reason of the 51 transactions contemplated hereby, any obligation to make any payment to any employee pursuant to any Plan or existing contract or arrangement. (r) Securities Activities. Neither the Borrower nor any of its Subsidiaries is engaged in the business of extending credit for the purpose of purchasing or carrying Margin Stock. (s) Solvency. After giving effect to the Loans to be made on the Initial Funding Date or such other date as Loans requested hereunder are made, and the disbursement of the proceeds of such Loans pursuant to the Borrower's instructions, each of the Borrower and GGP, Inc. is Solvent. (t) Insurance. Schedule 7.1-T accurately sets forth as of the Closing Date all insurance policies and programs currently in effect with respect to the respective Property and assets and business of the Borrower and its Subsidiaries, specifying for each such policy and program, (i) the amount thereof, (ii) the risks insured against thereby, (iii) the name of the insurer and each insured party thereunder, (iv) the policy or other identification number thereof, and (v) the expiration date thereof. Such insurance policies and programs are currently in full force and effect, in compliance with the requirements of Section 9.5 hereof and, together with payment by the insured of scheduled deductible payments, are in amounts sufficient to cover the replacement value of the respective Property and assets of the Borrower and/or its Subsidiaries. (u) REIT Status. GGP, Inc. qualifies as a REIT under the Internal Revenue Code. (v) Ownership of Property. Ownership of substantially all Property of the Consolidated Businesses is held by the Borrower and its Subsidiaries. (w) Year 2000 Issues. The Borrower has reviewed and assessed its and its Subsidiaries' business operations and computer systems and applications to address the "year 2000 problem" (i.e., the risk that computer applications and equipment used by the Borrower, directly or indirectly through third parties, may have been or may be unable properly to perform date-sensitive functions before, during or after January 1, 2000), and the "year 2000 problem" has not resulted in and is not reasonably expected to result in a Material Adverse Effect on the business, financial condition, operations or Properties of the Borrower or any of its Subsidiaries, or on the ability of the Borrower to repay the Loans and otherwise fulfill its Obligations under this Agreement. The Borrower shall promptly deliver to the Administrative Agent all information relating to this representation that the Administrative Agent may reasonably request. ARTICLE VIII - REPORTING COVENANTS The Borrower covenants and agrees that so long as any Revolving Credit Commitments are outstanding and thereafter until payment in full of all of the Obligations (other than indemnities pursuant to Section 15.3 not yet due), unless the Requisite Lenders shall otherwise give prior written consent thereto: 52 8.1 Borrower Accounting Practices. The Borrower shall maintain, and cause each of its Subsidiaries to maintain, a system of accounting established and administered in accordance with sound business practices to permit preparation of Consolidated and Consolidating financial statements in conformity with GAAP, and each of the financial statements and reports described below shall be prepared from such system and records and in form satisfactory to the Administrative Agent. 8.2 Financial Reports. The Borrower shall deliver or cause to be delivered to the Administrative Agent and the Lenders: 53 (a) Quarterly Reports. (i) Borrower Quarterly Financial Reports. As soon as practicable, and in any event within forty-five (45) days after the end of each fiscal quarter in each Fiscal Year (other than the last fiscal quarter in each Fiscal Year), an unaudited Consolidated balance sheet of the Borrower and the related Consolidated statements of income and cash flow of the Borrower (to be prepared and delivered quarterly in conjunction with the other reports delivered hereunder at the end of each fiscal quarter) for each such fiscal quarter, in each case in form and substance satisfactory to the Administrative Agent and, in comparative form, the corresponding figures for the corresponding periods of the previous Fiscal Year, certified by an Authorized Financial Officer of GGP, Inc. as fairly presenting the Consolidated and Consolidating financial position of the Borrower and its Consolidated Subsidiaries as of the dates indicated and the results of its operations and cash flow for the months indicated in accordance with GAAP, subject to normal quarterly adjustments. (ii) GGP, Inc. Quarterly Financial Reports. As soon as practicable, and in any event within forty-five (45) days after the end of each fiscal quarter in each Fiscal Year (other than the last fiscal quarter in each Fiscal Year), the Financial Statements of GGP, Inc. and its Subsidiaries on Form 10Q as at the end of such period and a report setting forth in comparative form the corresponding figures for the corresponding period of the previous Fiscal Year, certified by an Authorized Financial Officer of GGP, Inc. as fairly presenting the Consolidated and Consolidating financial position of GGP, Inc. and its Subsidiaries as of the date indicated and the results of its operations and cash flow for the period indicated in accordance with GAAP, subject to normal adjustments. (iii) Quarterly Compliance Certificates. Together with each delivery of any quarterly report pursuant to paragraph (a)(i) of this Section 8.2, the Borrower shall deliver an Officer's Certificate of the Borrower (the "Quarterly Compliance Certificates"), signed by the Borrower's respective Authorized Financial Officers setting forth, representing and certifying (A) that the Authorized Financial Officer signatory thereto has reviewed the terms of the Loan Documents, and has made, or caused to be made under his/her supervision, a review in reasonable detail of the transactions and Consolidated and Consolidating financial condition of the Borrower and its Subsidiaries, during the fiscal quarter covered by such reports, that such review has not disclosed the existence during or at the end of such fiscal quarter, and that such officer does not have knowledge of the existence as of the date of such Officer's Certificate, of any condition or event which constitutes an Event of Default or Potential Event of Default or mandatory prepayment event as described in Section 4.1(d) of this Agreement, or, if any such condition or event existed or exists, and specifying the nature and period of existence thereof and what action the Borrower or any of its Subsidiaries has taken, is taking and proposes to take with respect thereto; (B) the calculations (in the form of Exhibit G hereto and otherwise with such specificity as the Administrative Agent may reasonably request) for the period then ended which demonstrate compliance with the covenants and financial ratios set forth in Articles IX and X and, when applicable, that no Event of Default described in Section 11.1 exists, (C) a schedule of changes, if any, in the Borrower's outstanding Indebtedness for borrowed money, including the amount, maturity, interest rate and amortization requirements, as well as such other information regarding such Indebtedness as may be reasonably requested by the Administrative Agent, since 54 the last date on which such a schedule was submitted, (D) a schedule of Combined EBITDA, (E) a schedule of each bankruptcy or cessation of operations of any tenant to which greater than 5% of the Borrower's share of consolidated minimum rent is attributable, of which bankruptcy or cessation of operations the Borrower obtained knowledge since the last date on which such a schedule was submitted, and (F) such other information and reports as the Administrative Agent may reasonably request. (b) Annual Reports. (i) Borrower Financial Statements. As soon as practicable, and in any event within ninety (90) days after the end of each Fiscal Year, (A) the unaudited Consolidated balance sheet of the Borrower and the related Consolidated statements of income and cash flow of the Borrower for such Fiscal Year, in each case in form and substance satisfactory to the Administrative Agent and, in comparative form, the corresponding figures for the previous Fiscal Year, certified by an Authorized Financial Officer of GGP, Inc. as fairly presenting the Consolidated and Consolidating financial position of each of the Borrower and its Consolidated Subsidiaries as at the dates indicated and the results of their operations and cash flow for the periods indicated in conformity with GAAP applied on a basis consistent with prior years, and (B) a copy of any management letter or any similar written report delivered to the Borrower or GGP, Inc. or to any Authorized Financial Officer thereof by any independent certified public accountants or other independent consultant in connection with or relating to such financial statements (which letter or report shall be subject to the confidentiality limitations set forth herein). The Administrative Agent and each Lender (through the Administrative Agent) may, with the consent of the Borrower (which consent shall not be unreasonably withheld), communicate directly with such accountants or consultant, with any such communication to occur together with a representative of the Borrower, at the expense of the Administrative Agent (or the Lender requesting such communication), upon reasonable notice and at reasonable times during normal business hours. (ii) GGP., Inc. Annual Financial Reports. As soon as practicable, and in any event within ninety (90) days after the end of each Fiscal Year, (A) the financial statements of GGP, Inc. and its Consolidated Subsidiaries as at the end of such period, and a report setting forth in comparative form the corresponding figures for the previous Fiscal Year, (B) an audit report with respect thereto by any independent certified public accountants reasonably acceptable to the Administrative Agent, which report shall be unqualified and shall state that such financial statements fairly present the Consolidated and Consolidating financial position of GGP, Inc. and its Consolidated Subsidiaries as of the date indicated and the results of its operations and cash flow for the period indicated in conformity with GAAP applied on a basis consistent with prior years (except for changes with which any such independent certified public accountants shall concur and which shall have been disclosed in the notes to the financial statements), and (C) a copy of the management letter or any similar written report delivered to GGP, Inc. or to any Authorized Financial Officer thereof by such independent certified public accountants or any other independent consultant in connection with or relating to such financial statements (which letter or report shall be subject to the confidentiality limitations set forth herein). The Administrative Agent and each Lender (through the Administrative Agent) may, with the consent of the Borrower (which consent shall not be unreasonably withheld), 55 communicate directly with such accountants or consultant, with any such communication to occur together with a representative of the Borrower, at the expense of the Administrative Agent (or the Lender requesting such communication), upon reasonable notice and at reasonable times during normal business hours. (iii) Annual Compliance Certificates. Together with each delivery of any annual report pursuant to clause (i) of this Section 8.2(b), the Borrower shall deliver Officer's Certificates of the Borrower (the "Annual Compliance Certificates" and, collectively with the Quarterly Compliance Certificates, the "Compliance Certificates"), signed by the Borrower's respective Authorized Financial Officers, setting forth, representing and certifying (A) that the officer signatory thereto has reviewed the terms of the Loan Documents, and has made, or caused to be made under his/her supervision, a review in reasonable detail of the transactions and Consolidated and Consolidating financial condition of the Borrower and its Subsidiaries, during the accounting period covered by such reports, that such review has not disclosed the existence during or at the end of such accounting period, and that such officer does not have knowledge of the existence as at the date of such Officer's Certificate, of any condition or event which constitutes an Event of Default or Potential Event of Default or mandatory prepayment event as described in Section 4.1(d) of this Agreement, or, if any such condition or event existed or exists, and specifying the nature and period of existence thereof and what action the Borrower or any of its Subsidiaries has taken, is taking and proposes to take with respect thereto; (B) the calculations (in the form of Exhibit G and otherwise with such specificity as the Administrative Agent may reasonably request) for the period then ended which demonstrate compliance with the covenants and financial ratios set forth in Articles IX and X and, when applicable, that no Event of Default described in Section 11.1 exists, (C) a schedule of the Borrower's outstanding Indebtedness for borrowed money, including the amount, maturity, interest rate and amortization requirements, as well as such other information regarding such Indebtedness as may be reasonably requested by the Administrative Agent, (D) a schedule of Combined EBITDA, (E) a schedule of the estimated taxable income of the Borrower for such fiscal year, (F) a statement of net operating income and schedule of tenant sales and occupancy with respect to each Real Property, (G) pro forma statements of operations (including, without limitation, projections of net operating income and interest expense for each Real Property) and sources and uses of capital for the next 24 months of the operations of GGP, Inc. and the Borrower, together with a capital plan for such 24 month period, all in form, content and detail reasonably acceptable to the Administrative Agent, and (I) such other information and reports as the Administrative Agent may reasonably request. (iv) Tenant Bankruptcy Reports. As soon as practicable, and in any event within ninety (90) days after the end of each Fiscal Year, the Borrower shall deliver a written report (which shall be incorporated into the Annual Compliance Certificate), in form reasonably satisfactory to the Administrative Agent, of all bankruptcy proceedings filed by or against, or the cessation of business or operations of, any tenant of any of the Real Properties of the Borrower or any of its Subsidiaries, the base rent payments of which tenant account for more than 5% of the Borrower's share of consolidated minimum rent in the Real Properties in the aggregate. (c) Reports of Capital Events. On the date of the consummation and funding of each Capital Event, the Borrower shall submit to the Administrative Agent a reasonably detailed report thereof, which shall include a computation of the Leverage Ratio after giving effect 56 thereto, and which shall be otherwise reasonably acceptable in form and substance to the Administrative Agent. (d) Information Regarding the Company. From time to time upon request by the Administrative Agent, the Borrower shall deliver to the Administrative Agent such information, reports and documents concerning the Company as the Administrative Agent may reasonably request. 8.3 Events of Default. Promptly upon the Borrower obtaining knowledge (a) of any condition or event which constitutes an Event of Default or Potential Event of Default, (b) that any Lender or the Administrative Agent has given any notice with respect to a claimed Event of Default or Potential Event of Default, (c) that any Person has given any notice to the Borrower or taken any other action with respect to a claimed default or event or condition of the type referred to in Section 11.1(e), or (d) of any condition or event which has or is reasonably likely to have a Material Adverse Effect, the Borrower shall deliver to the Administrative Agent and the Lenders an Officer's Certificate specifying (i) the nature and period of existence of any such claimed default, Event of Default, Potential Event of Default, condition or event, (ii) the notice given or action taken by such Person in connection therewith, and (iii) what action the Borrower has taken, is taking and proposes to take with respect thereto. 8.4 Lawsuits. (i) Promptly upon the Borrower's obtaining knowledge of the institution of, or written threat of, any action, suit, proceeding, governmental investigation or arbitration against or affecting the Borrower or any of its Subsidiaries of the type described in Section 7.1(i) of this Agreement not previously disclosed pursuant to Section 7.1(i), the Borrower shall give written notice thereof to the Administrative Agent and the Lenders and provide such other information as may be reasonably available to enable each Lender and the Administrative Agent and its counsel to evaluate such matters; (ii) as soon as practicable and in any event within forty-five (45) days after the end of each fiscal quarter of the Borrower, the Borrower shall provide a written quarterly report to the Administrative Agent and the Lenders (which may be incorporated into the Quarterly Compliance Certificate) covering the institution of, or written threat of, any action, suit, proceeding, governmental investigation or arbitration of the type described in Section 7.1(i) of this Agreement (not previously reported) and involving a Claim which is uninsured against or affecting the Borrower or any of its Subsidiaries or any Property of the Borrower or any of its Subsidiaries not previously disclosed by the Borrower to the Administrative Agent and the Lenders, and shall provide such other information at such time as may be reasonably available to enable each Lender and the Administrative Agent and its counsel to evaluate such matters; and (iii) in addition to the requirements set forth in clauses (i) and (ii) of this Section 8.4, the Borrower upon request of the Administrative Agent or the Requisite Lenders shall promptly give written notice of the status of any action, suit, proceeding, governmental investigation or arbitration covered by a report delivered pursuant to clause (i) or (ii) above and provide such other information as may be reasonably available to it to enable each Lender and the Administrative Agent and its counsel to evaluate such matters. 8.5 Insurance. If requested by the Administrative Agent, the Borrower shall promptly deliver to the Administrative Agent and the Lenders (i) a report in form and substance reasonably satisfactory to the Administrative Agent and the Lenders outlining all insurance coverage 57 maintained as of the date of such report by the Borrower and its Subsidiaries and the duration of such coverage and (ii) the certificate of an Authorized Financial Officer that all premiums with respect to such coverage have been paid when due. 8.6 ERISA Notices. The Borrower shall deliver or cause to be delivered to the Administrative Agent and the Lenders, at the Borrower's expense, the following information and notices as soon as reasonably possible, and in any event: (a) within fifteen (15) Business Days after the Borrower or any ERISA Affiliate knows or has reason to know that an ERISA Termination Event has occurred, a written statement of the chief financial officer of the Borrower describing such ERISA Termination Event and the action, if any, which the Borrower or any ERISA Affiliate has taken, is taking or proposes to take with respect thereto, and when known, any action taken or threatened by the IRS, DOL or PBGC with respect thereto; (b) within fifteen (15) Business Days after the Borrower knows or has reason to know that a prohibited transaction (defined in Sections 406 of ERISA and 4975 of the Internal Revenue Code) has occurred, a statement of the chief financial officer of the Borrower describing such transaction and the action which the Borrower or any ERISA Affiliate has taken, is taking or proposes to take with respect thereto; (c) within fifteen (15) Business Days after the filing of the same with the DOL, IRS or PBGC, copies of each annual report (IRS Form 5500 series), including Schedule B thereto, filed with respect to each Benefit Plan; (d) within fifteen (15) Business Days after receipt by the Borrower or any ERISA Affiliate of each actuarial report for any Benefit Plan or Multiemployer Plan and each annual report for any Multiemployer Plan (IRS Form 5500), copies of each such report; (e) within fifteen (15) Business Days after the filing of the same with the IRS, a copy of each funding waiver request filed with respect to any Benefit Plan and all written communications received by the Borrower or any ERISA Affiliate with respect to such request; (f) within fifteen (15) Business Days after the occurrence of any material increase in the benefits of any existing Benefit Plan or Multiemployer Plan or the establishment of any new Benefit Plan or the commencement of contributions to any Benefit Plan or Multiemployer Plan to which the Borrower or any ERISA Affiliate was not previously contributing, notification of such increase, establishment or commencement; (g) within fifteen (15) Business Days after the Borrower or any ERISA Affiliate receives notice of the PBGC's intention to terminate a Benefit Plan or to have a trustee appointed to administer a Benefit Plan, copies of each such notice; (h) within fifteen (15) Business Days after the Borrower or any ERISA Affiliate receives notice of any unfavorable determination letter from the IRS regarding the 58 qualification of a Plan under Section 401(a) of the Internal Revenue Code, copies of each such letter; (i) within fifteen (15) Business Days after the Borrower or any ERISA Affiliate receives notice from a Multiemployer Plan regarding the imposition of withdrawal liability, copies of each such notice; (j) within fifteen (15) Business Days after the Borrower or any ERISA Affiliate fails to make a required installment or any other required payment under Section 412 of the Internal Revenue Code on or before the due date for such installment or payment, a notification of such failure; and (k) within fifteen (15) Business Days after the Borrower or any ERISA Affiliate knows or has reason to know (i) a Multiemployer Plan has been terminated, (ii) the administrator or plan sponsor of a Multiemployer Plan intends to terminate a Multiemployer Plan, or (iii) the PBGC has instituted or will institute proceedings under Section 4042 of ERISA to terminate a Multiemployer Plan, notification of such termination, intention to terminate, or institution of proceedings. For purposes of this Section 8.6, the Borrower and any ERISA Affiliate shall be deemed to know all facts known by the "Administrator" of any Plan of which the Borrower or any ERISA Affiliate is the plan sponsor. 8.7 Environmental Notices. The Borrower shall notify the Administrative Agent and the Lenders in writing, promptly upon any senior employee of the Borrower responsible for environmental matters at the applicable Property of the Borrower or any of its Subsidiaries learning thereof with respect to a Property, of any of the following (together with any material documents and correspondence received or sent in connection therewith): (a) notice or claim to the effect that the Borrower or any of its Subsidiaries is or may be liable to any Person as a result of the Release or threatened Release of any Contaminant into the environment, if such liability would result in a Material Adverse Effect; (b) notice that the Borrower or any of its Subsidiaries is subject to investigation by any Governmental Authority evaluating whether any Remedial Action is needed to respond to the Release or threatened Release of any Contaminant into the environment which is reasonably likely to result in a Material Adverse Effect; (c) notice that any Property of the Borrower or any of its Subsidiaries is subject to an Environmental Lien if the claim to which such Environmental Lien relates would result in a Material Adverse Effect; (d) notice of a material violation by the Borrower or any of its Subsidiaries of any Environmental, Health or Safety Requirement of Law which is reasonably likely to result in a Material Adverse Effect; 59 (e) any condition which might reasonably result in a violation by the Borrower or any Subsidiary of the Borrower of any Environmental, Health or Safety Requirement of Law, which violation would result in a Material Adverse Effect; (f) commencement or threat of any judicial or administrative proceeding alleging a violation by the Borrower or any of its Subsidiaries of any Environmental, Health or Safety Requirement of Law, which would result in a Material Adverse Effect; (g) new or proposed changes to any existing Environmental, Health or Safety Requirement of Law that is reasonably likely to result in a Material Adverse Effect; or (h) any proposed acquisition of stock, assets, real estate, or leasing of Property, or any other action by the Borrower or any of its Subsidiaries that could subject the Borrower or any of its Subsidiaries to environmental, health or safety Liabilities and Costs which are reasonably likely to result in a Material Adverse Effect. 8.8 Labor Matters. The Borrower shall notify the Administrative Agent in writing, promptly upon the Borrower's learning thereof, of any labor dispute to which the Borrower or any of its Subsidiaries may become a party (including, without limitation, any strikes, lockouts or other disputes relating to any Property of such Persons and other facilities) which could result in a Material Adverse Effect. 8.9 Notices of Asset Sales and/or Acquisitions. The Borrower shall deliver to the Administrative Agent and the Lenders written notice of each of the following upon the occurrence thereof: (a) a sale, transfer or other disposition of assets, in a single transaction or series of related transactions, for consideration in excess of $200,000,000, (b) an acquisition of assets, in a single transaction or series of related transactions, for consideration in excess of $200,000,000, and (c) the grant of a Lien with respect to assets, in a single transaction or series of related transactions, in connection with Indebtedness aggregating an amount in excess of $200,000,000. 8.10 [Intentionally Omitted] 8.11 Other Reports. The Borrower shall deliver or cause to be delivered to the Administrative Agent copies of all financial statements, reports, material notices and other materials, if any, sent or made available generally by GGP, Inc. or the Borrower to their respective Securities holders or filed with the Commission, all press releases made available generally by GGP, Inc., the Borrower or any of its Subsidiaries to the public concerning material developments in the business of GGP, Inc., the Borrower or any such Subsidiary and all notifications received by GGP, Inc., the Borrower or its Subsidiaries pursuant to the Securities Exchange Act and the rules promulgated thereunder. 8.12 Other Information. Promptly upon receiving a request therefor from the Administrative Agent, the Borrower shall prepare and deliver to the Administrative Agent such other information with respect to the Borrower and its Subsidiaries, on a Consolidated basis, as from time to time may be reasonably requested by the Administrative Agent. 60 ARTICLE IX - AFFIRMATIVE COVENANTS Borrower covenants and agrees that so long as any Revolving Credit Commitments are outstanding and thereafter until payment in full of all of the Obligations (other than indemnities pursuant to Section 15.3 not yet due), unless the Requisite Lenders shall otherwise give prior written consent: 9.1 Existence, Etc. The Borrower shall, and shall cause each of its Subsidiaries to, at all times maintain its corporate existence or existence as a limited liability company, limited partnership, general partnership, trust or joint venture, as applicable, and preserve and keep, or cause to be preserved and kept, in full force and effect, its rights and franchises material to its businesses, except where the loss or termination of such rights and franchises is not likely to have a Material Adverse Effect. 9.2 Powers; Conduct of Business. The Borrower shall remain qualified, and shall cause each of its Subsidiaries to qualify and remain qualified, to do business and maintain its good standing in each jurisdiction in which the nature of its business and the ownership of its respective Properties requires it to be so qualified and in good standing. 9.3 Compliance with Laws, Etc. The Borrower shall, and shall cause each of its Subsidiaries to, (a) comply in all material respects with all Requirements of Law and all restrictive covenants affecting such Person or the business, Property, assets or operations of such Person, and (b) obtain and maintain as needed all Permits necessary for its operations (including, without limitation, the operation of the Real Properties) and maintain such Permits in good standing, except where noncompliance with either clause (a) or (b) above is not reasonably likely to have a Material Adverse Effect. 9.4 Payment of Taxes and Claims. (a) The Borrower shall pay, and cause each of its Subsidiaries to pay, (i) all taxes, assessments and other governmental charges imposed upon it or on any of its Property or assets or in respect of any of its franchises, licenses, receipts, sales, use, payroll, employment, business, income or Property before any penalty or interest accrues thereon, and (ii) all Claims (including, without limitation, claims for labor, services, materials and supplies) for sums which have become due and payable and which by law have or may become a Lien (other than a Lien permitted by Section 10.2 or a Customary Permitted Lien for property taxes and assessments not yet due) upon any of the Borrower's or any of the Borrower's Subsidiaries' Property or assets, prior to the time when any penalty or fine shall be incurred with respect thereto; provided, however, that no such taxes, assessments, fees and governmental charges referred to in clause (i) above or Claims referred to in clause (ii) above need be paid if being contested in good faith by appropriate proceedings diligently instituted and conducted and if such reserve or other appropriate provision, if any, as shall be required in conformity with GAAP shall have been made therefor. 9.5 Insurance. The Borrower shall maintain for itself and its Subsidiaries, or shall cause each of its Subsidiaries to maintain in full force and effect the insurance policies and programs listed on Schedule 7.1-T or substantially similar policies and programs or other policies 61 and programs as are reasonably acceptable to the Administrative Agent. All such policies and programs shall be maintained with insurers reasonably acceptable to the Administrative Agent. 9.6 Inspection of Property; Books and Records; Discussions. The Borrower shall permit, and cause each of its Subsidiaries to permit, any authorized representative(s) designated by either the Administrative Agent or other Lender to visit and inspect any of their respective Real Properties, to examine, audit, check and make copies of their respective financial and accounting records, books, journals, orders, receipts and any correspondence and other data relating to their respective businesses or the transactions contemplated hereby (including, without limitation, in connection with environmental compliance, hazard or liability), and to discuss their affairs, finances and accounts with their Authorized Financial Officers and independent certified public accountants, all with a representative of the Borrower present, upon reasonable notice and at such reasonable times during normal business hours, as often as may be reasonably requested. Each such visitation and inspection shall be at such visitor's expense. The Borrower shall keep and maintain, and cause its Subsidiaries to keep and maintain, in all material respects proper books of record and account in which entries in conformity with GAAP shall be made of all dealings and transactions in relation to their respective businesses and activities. 9.7 ERISA Compliance. The Borrower shall, and shall cause each of its ERISA Affiliates to, establish, maintain and operate all Plans to comply in all material respects with the provisions of ERISA, the Internal Revenue Code, all other applicable laws, and the regulations and interpretations having the force of law thereunder and the respective requirements of the governing documents for such Plans. 9.8 Maintenance of Property. The Borrower shall, and shall cause each of its Subsidiaries to, maintain in all material respects all of their respective owned and leased Property in good, safe and insurable condition and repair, and not permit, commit or suffer any waste or abandonment of any such Property and from time to time shall make or cause to be made all material repairs, renewal and replacements thereof, including, without limitation, any capital improvements which may be required to maintain the same in good condition and repair; provided, however, that such Property may be altered or renovated in the ordinary course of business of the Borrower or such applicable Subsidiary. Without any limitation on the foregoing, the Borrower shall maintain the Real Property in a manner such that each Real Property can be used in the manner and substantially for the purposes such Real Property is used on the Closing Date, including, without limitation, maintaining all utilities, access rights, zoning and necessary Permits for such Real Property. 9.9 REIT Status. GGP, Inc. shall at all times (1) remain a publicly traded company listed on the New York Stock Exchange or other national stock exchange; (2) maintain its status as a REIT under the Internal Revenue Code, and (3) retain direct or indirect management and control of the Borrower. The Partnership shall at all times retain direct or indirect control of the Company. 9.10 Ownership of Property. The ownership of substantially all Property of the Consolidated Businesses shall be held by the Borrower and its Subsidiaries. 62 9.11 Financing. The Borrower shall cause the condition set forth in Section 6.2(e) hereof to be fulfilled on or before October 31, 2000. ARTICLE X - NEGATIVE COVENANTS Borrower covenants and agrees that it shall comply, or cause compliance, with the following covenants so long as any Revolving Credit Commitments are outstanding and thereafter until payment in full of all of the Obligations (other than indemnities pursuant to Section 15.3 not yet due), unless the Requisite Lenders shall otherwise give prior written consent: 10.1 Sales of Assets. Neither the Borrower nor any of its Subsidiaries shall sell, assign, transfer, lease, convey or otherwise dispose of any Property, whether now owned or hereafter acquired, or any income or profits therefrom, or enter into any agreement to do so which would result in a Material Adverse Effect. 10.2 Liens. Neither the Borrower nor any of its Subsidiaries shall directly or indirectly create, incur, assume or permit to exist any Lien on or with respect to any Property, or (to the extent the same constitutes a pledge or other encumbrance of equity interests in the Borrower or the Consolidated Businesses) on or with respect to any such Securities held by the Borrower, except, subject to Section 10.12(i) hereof: (a) Liens with respect to Capital Leases of Equipment entered into in the ordinary course of business of the Borrower or any of its Subsidiaries pursuant to which the aggregate Indebtedness under such Capital Leases does not exceed $1,000,000 for any Real Property; (b) Customary Permitted Liens; and (c) Liens to secure capital contributions arising in favor of the holders of equity interests in entities which are Minority Holdings of the Borrower pursuant to the terms of the applicable partnership, joint venture, operating, shareholders or similar agreement between such holders and the Borrower; provided, however, that none of the foregoing shall limit or prohibit the Borrower from (i) granting Liens on its respective Real Properties for the purposes of securing Secured Indebtedness or (ii) incurring additional Unsecured Indebtedness otherwise permitted hereunder. 10.3 Conduct of Business. Neither the Borrower nor any of its Subsidiaries shall engage in any business, enterprise or activity other than (a) the businesses of acquiring, developing, redeveloping and managing predominately retail Real Properties and portfolios of like Real Properties and (b) any business or activities which are substantially similar, related or incidental thereto. 10.4 Transactions with Partners and Affiliates. Neither the Borrower nor any of its Subsidiaries shall directly or indirectly enter into or permit to exist any transaction (including, without limitation, the purchase, sale, lease or exchange of any Property or the rendering of any service) with any Affiliate of the Borrower which is not its Subsidiary, on terms that are 63 determined by the Board of Directors of GGP, Inc. to be less favorable to the Borrower or any of its Subsidiaries, as applicable, than those that might be obtained in an arm's length transaction at the time from Persons who are not such an Affiliate. Nothing contained in this Section 10.4 shall prohibit (a) increases in compensation and benefits for officers and employees of the Borrower or any of its Subsidiaries which are customary in the industry or consistent with the past business practice of the Borrower or such Subsidiary; provided, however, that no Event of Default has occurred and is continuing; (b) payment of customary partners' indemnities; or (c) performance of any obligations arising under the Loan Documents. 10.5 Restriction on Fundamental Changes and Changes of Control. Neither the Borrower nor any of its Subsidiaries shall enter into any merger or consolidation, or liquidate, windup or dissolve (or suffer any liquidation or dissolution), or convey, lease, sell, transfer or otherwise dispose of, in one transaction or series of related transactions, all or substantially all of the Borrower's or any such Subsidiary's business or Property, whether now or hereafter acquired, except in connection with (a) issuance, transfer, conversion or repurchase of limited partnership interests in the Partnership, or (b) conversion or repurchase of membership interests in the Company to the extent required pursuant to any existing Contractual Obligation under the Borrower Operating Agreement. Notwithstanding the foregoing, the Borrower shall be permitted to merge with another Person so long as the Borrower (i) is the surviving Person following such merger, or (ii) complies with Section 4.1(d) hereof. No Change of Control shall occur. 10.6 Margin Regulations; Securities Laws. Neither the Borrower nor any of its Subsidiaries, shall use all or any portion of the proceeds of any credit extended under this Agreement to purchase or carry Margin Stock. 10.7 ERISA. The Borrower shall not and shall not permit any of its ERISA Affiliates to: (a) engage in any prohibited transaction described in Sections 406 of ERISA or 4975 of the Internal Revenue Code for which a statutory or class exemption is not available or a private exemption has not been previously obtained from the DOL; (b) permit to exist any accumulated funding deficiency (as defined in Sections 302 of ERISA and 412 of the Internal Revenue Code), with respect to any Benefit Plan, whether or not waived; (c) fail to pay timely required contributions or annual installments due with respect to any waived funding deficiency to any Benefit Plan; (d) terminate any Benefit Plan which would result in any liability of Borrower or any ERISA Affiliate under Title IV of ERISA; (e) fail to make any contribution or payment to any Multiemployer Plan which Borrower or any ERISA Affiliate may be required to make under any agreement relating to such Multiemployer Plan, or any law pertaining thereto; 64 (f) fail to pay any required installment or any other payment required under Section 412 of the Internal Revenue Code on or before the due date for such installment or other payment; or (g) amend a Benefit Plan resulting in an increase in current liability for the plan year such that the Borrower or any ERISA Affiliate is required to provide security to such Plan under Section 401(a)(29) of the Internal Revenue Code. 10.8 Organizational Documents. Neither Borrower nor any of their respective Subsidiaries shall amend, modify or otherwise change any of the terms or provisions in any of their respective Organizational Documents as in effect on the Closing Date, except amendments to effect (a) a change of name of the Borrower or any such Subsidiary (provided, however, that the Borrower shall have provided the Administrative Agent with at least ten (10) Business Days' prior written notice of any such name change), (b) changes to the Borrower Partnership Agreement relating to the acquisition of Real Property or interests in an owner of Real Property with respect to which the consideration paid to the seller thereof includes limited partnership interests in the Partnership, or (c) changes that would not affect such Organizational Documents or the interests of the Lenders in any material manner not otherwise permitted under this Agreement. 10.9 Fiscal Year. Neither the Borrower nor any of its Consolidated Subsidiaries shall change its Fiscal Year for accounting or tax purposes from a period consisting of the 12-month period ending on December 31 of each calendar year. 10.10 [Intentionally Omitted] 10.11 Investments. Neither the Borrower nor any of its Subsidiaries shall directly or indirectly make or own any Investment, except: (a) Investments in Cash and Cash Equivalents; (b) Subject to the limitations set forth in this Section 10.11, Investments in the Borrower's Subsidiaries, Borrower's Affiliates and the Management Company; (c) Investments received in connection with the bankruptcy or reorganization of suppliers and lessees and in settlement of delinquent obligations of, and other disputes with, lessees and suppliers arising in the ordinary course of business; (d) Investments in: (i) any individual Real Property (other than the Ala Moana Center and Property related thereto) which do not exceed seven percent (7%) of the Capitalization Value after giving effect to such Investments of the Borrower and its Subsidiaries; (ii) any single Person owning Property or any portfolio of Properties (other than the Homart Portfolio and the Ivanhoe Portfolio of the Borrower) which do not exceed twenty percent (20%) of the Capitalization Value after giving effect to such Investments of the 65 Borrower and its Subsidiaries, it being understood that no Investment in any individual Person will be permitted if the Borrower's allocable share of the Investment of such Person in any individual Property would exceed the limitation described in clause (A) above; (iii) joint ventures and Subsidiaries that are not Consolidated Subsidiaries (including, without limitation, such Subsidiaries in the Homart Portfolio of the Borrower) which, in the aggregate, do not exceed fifty percent (50%) of the Capitalization Value after giving effect to such Investments of the Borrower and its Subsidiaries; (iv) Real Estate Under Construction which, in the aggregate, does not exceed fifteen percent (15%) of the Capitalization Value after giving effect to such Investments of the Borrower and its Subsidiaries (provided, however, that, for purposes of this clause (D) only, the term Real Estate Under Construction shall not include any Construction Asset which is at least eighty percent (80%) leased, and provided further that, for purposes of this clause (D), any portion of a Construction Asset which is under a binding contract of sale to an "anchor tenant" shall be deemed to be leased); and (v) Inactive Assets which, in the aggregate, do not exceed eight percent (8%) of the Capitalization Value after giving effect to such Investments of the Borrower and its Subsidiaries; provided, however, that the Investments of the Borrower and its Subsidiaries described in clauses (D) and (E) above shall not together exceed fifteen percent (15%) of the Capitalization Value after giving effect to such Investments of the Borrower and its Subsidiaries; and (e) Investments held as of the Closing Date. 66 10.12 Other Financial Covenants. (a) Minimum Combined Equity Value. The Combined Equity Value shall at no time be less than the sum of (i) $2,000,000,000, plus (ii) an amount equal to seventy-five percent (75%) of the aggregate net proceeds received by the Borrower or GGP, Inc. in connection with any offering or issuance after the date of this Agreement of equity Securities (including, without limitation, common stock, preferred stock partnership interests and membership interests) representing interests in the Borrower, or GGP, Inc. or any of their respective Subsidiaries. (b) Consolidated Interest Coverage Ratio. As of the last day of each fiscal quarter for the immediately preceding consecutive four fiscal quarters, the ratio of (i) Combined EBITDA to (ii) Combined Interest Expense, shall not be less than 1.8 to 1.0. (c) Minimum Debt Yield. As of the last day of each fiscal quarter, the ratio (expressed as a percentage) of (i) the sum of (A) Combined EBITDA plus (B) interest paid from reserves established under construction loans to (ii) Total Adjusted Outstanding Indebtedness shall not be less than 13.25%. (d) Dividends and Redemptions. (i) The Borrower will not, as determined on an aggregate annual basis, pay any dividends (excluding special capital gain distributions, if any) in excess of 65% of FFO for such year. (ii) Neither the Borrower nor GGP, Inc. will, as determined on a combined, aggregate annual basis for both the Borrower and GGP, Inc., voluntarily redeem, repurchase or otherwise acquire for value more than $50,000,000 of the common stock, preferred stock, partnership interests and/or membership interests issued by GGP, Inc. and/or the Borrower, respectively, excluding any such redemption, repurchase or acquisition required pursuant to any Contractual Obligation to honor any conversion, exchange or put right heretofore or hereafter granted to any Person as consideration for capital contributions to GGP, Inc. or the Borrower, as the case may be, or in furtherance of any other bona fide business purpose of GGP, Inc. or the Borrower, as the case may; provided, however, that no such redemption, repurchase or acquisition shall have, or be reasonably likely to have, a Material Adverse Effect. (e) Minimum Fixed Charge Coverage Ratio. As of the first day of each calendar quarter for the immediately preceding calendar quarter, the ratio of (i) Combined EBITDA to (ii) Fixed Charges shall not be less than 1.5 to 1.0. (f) Minimum Net Equity and Loan-to-Value For Certain Wholly-Owned Properties. In the event that, and for so long as, the cumulative, aggregate Investments of the Borrower and its Subsidiaries in joint ventures and Subsidiaries that are not Consolidated Subsidiaries (including, without limitation, such Subsidiaries in the Homart Portfolio of the Borrower), exceed thirty five percent (35%) of the Capitalization Value: (i) the Capitalization Value attributable to Properties that are wholly owned, directly or indirectly, by the Borrower, 67 less Indebtedness secured by Liens thereon or otherwise attributable thereto, shall at no time be less than $1,750,000,000; and (ii) the Loan-to-Value Ratio with respect to such wholly-owned Properties shall at no time exceed sixty five percent (65%), in the aggregate. (g) Leverage Ratio. (i) Neither the Borrower nor any of its Subsidiaries shall directly or indirectly create, incur, assume or otherwise become or remain directly or indirectly liable with respect to: (w) any Indebtedness, except Indebtedness which, when aggregated with Indebtedness of the Borrower and, without duplication, its Subsidiaries and Minority Holdings Indebtedness allocable in accordance with GAAP to the Borrower as of the time of determination, would not cause Total Adjusted Outstanding Indebtedness to exceed sixty-five percent (65%) of Capitalization Value as of the date of incurrence; (x) any Recourse Indebtedness, except Recourse Indebtedness which, when aggregated with Recourse Indebtedness of the Borrower and, without duplication, its respective Subsidiaries and Recourse Minority Holdings Indebtedness allocable in accordance with GAAP to the Borrower as of the time of determination, would not cause the portion of Total Adjusted Outstanding Indebtedness consisting of Recourse Indebtedness to exceed twenty percent (20%) of Capitalization Value as of the date of incurrence; (y) secured Recourse Indebtedness (other than Indebtedness relating to construction loans) in an aggregate amount outstanding not to exceed $175,000,000; or (z) any Unsecured Indebtedness, except Unsecured Indebtedness which, when aggregated with Total Adjusted Outstanding Unsecured Indebtedness, would not cause Total Adjusted Outstanding Unsecured Indebtedness to exceed the lesser of twenty percent (20%) Combined Equity Value as of the date of incurrence or the amount that is then applicable under subsection (ii), subsection (iii) or subsection (iv) below. (ii) From and after the date hereof, through and including July 31, 2002, Total Adjusted Outstanding Unsecured Indebtedness shall not exceed $650,000,000. (iii) From and after August 1, 2002, through and including July 31, 2003, Total Adjusted Outstanding Unsecured Indebtedness shall not exceed $450,000,000. (iv) As of and after August 1, 2003, if this Agreement is then in effect, through and including the Revolving Credit Termination Date, Total Adjusted Outstanding Unsecured Indebtedness shall not exceed $300,000,000. (h) Most Favored Loan. The Borrower will not enter into any credit agreement or execute any note, deed of trust, mortgage, security agreement, pledge or any other loan agreement, document or instrument governing, evidencing or securing any Indebtedness of the Borrower which is either (A) Unsecured Indebtedness or (B) secured and Recourse Indebtedness, the terms of which require compliance by the Borrower with covenants that, taken as a whole, are more restrictive than the covenants of the Borrower herein contained, including, without limitation, those covenants set forth in this Section 10.12. (i) Certain Liens. Neither the Borrower, GGP, Inc. nor any of their respective Affiliates controlled by them, respectively, will encumber with any Lien any stock, partnership 68 interest, joint venture interest, membership interest, beneficial interest or other equity interest in any corporation, partnership, joint venture, limited liability company, trust or other entity that (i) owns any of the Property, or (ii) is a direct or indirect shareholder, partner, joint venturer, member, beneficiary or other type of equity holder in any entity described in clause (i) above; provided, however, that the foregoing prohibition shall not apply with respect to any of the encumbrances existing on the date hereof set forth in Schedule 10.12 hereto; and provided further that the prohibition set forth in this subsection (i) shall not apply as to any such corporation, partnership, joint venture, limited liability company, trust or other entity which owns Property with respect to which the Loan-to-Value Ratio as to all Secured Indebtedness for borrowed money related to such Property, in the aggregate, before giving effect to such encumbrance, is not greater than fifty percent (50%), and, after giving effect to such encumbrance, is not greater than sixty- five percent (65%); and provided further that the prohibition set forth in this subsection (i) shall not apply as to any such encumbrance granted to secure Indebtedness related to any Property or asset of such corporation, partnership, joint venture, limited liability company, trust or other entity, if such encumbrance secures a construction loan and the Loan-to-Value Ratio with respect to all Secured Indebtedness relating to the construction in question does not exceed seventy-five percent (75%), or would not exceed such Loan-to-Value Ratio, but for the applicability of unusually onerous stamp, transfer or recording taxes and fees in connection with such encumbrance; and provided further that the prohibition set forth in this subsection (i) shall not apply as to any such encumbrance of equity interests in Minority Holdings in favor of the holder(s) of the remaining equity interests in such Minority Holdings to secure obligations under the applicable Organizational Documents of such Minority Holdings. ARTICLE XI - EVENTS OF DEFAULT; RIGHTS AND REMEDIES 11.1 Events of Default. Each of the following occurrences shall constitute an Event of Default under this Agreement: (a) Failure to Make Payments When Due. The Borrower shall fail to pay when due any principal payment of or interest payment on the Obligations. (b) Breach of Certain Covenants. (i) The Borrower shall fail duly and punctually to perform or observe any agreement, covenant or obligation binding on the Borrower under Sections 8.3, 9.1, 9.2, 9.3, 9.9, 9.10 or Article X. (ii) The Borrower shall fail duly and punctually to perform or observe any agreement, covenant or obligation binding on the Borrower under Sections 9.4, 9.5 or 9.6, and such failure shall continue for fifteen (15) days after receipt of written notice from the Administrative Agent thereof. (c) Breach of Representation or Warranty. Any representation or warranty made by the Borrower to the Administrative Agent or any other Lender herein or by the Borrower or any of its Subsidiaries in any of the other Loan Documents or in any statement or certificate at 69 any time given by any such Person pursuant to any of the Loan Documents shall be false or misleading in any material respect on the date as of which made. (d) Other Defaults. Except as set forth in the next sentence, the Borrower shall default in the performance of or compliance with any term contained in this Agreement (other than as identified in paragraphs (a), (b) or (c) of this Section 11.1), or any default or event of default (other than as identified in paragraphs (a), (b) or (c) of this Section 11.1) shall occur under any of the other Loan Documents, and such default or event of default shall continue for thirty (30) days after receipt of written notice from the Administrative Agent thereof. Notwithstanding the foregoing sentence, such failure or noncompliance shall not constitute an Event of Default so long as the Borrower commences the cure within such thirty (30) day period after the receipt of written notice, thereafter diligently pursues the same until completion and completes the cure of such failure or noncompliance within ninety (90) days after the receipt of such notice. (e) Acceleration of Other Indebtedness. Any breach, default or event of default shall occur, or any other condition shall exist, subject to the receipt of any applicable notice and the expiration of any applicable cure period or grace period, under any instrument, agreement or indenture pertaining to any Recourse Indebtedness (other than the Obligations) of the Borrower or its Subsidiaries aggregating $15,000,000 or more; or any such Recourse Indebtedness aggregating $15,000,000 or more shall be otherwise declared to be due and payable (by acceleration or otherwise) or required to be prepaid, redeemed or otherwise repurchased by the Borrower or any of its Subsidiaries (other than by a regularly scheduled required prepayment) prior to the stated maturity thereof. (f) Involuntary Bankruptcy: Appointment of Receiver, Etc. (i) An involuntary case shall be commenced against the Borrower, or any of its Subsidiaries to which more than $50,000,000 of the Capitalization Value is attributable, and the petition shall not be dismissed, stayed or discharged within sixty (60) days after commencement of the case; or a court having jurisdiction in the premises shall enter a decree or order for relief in respect of the Borrower or any of their respective Subsidiaries in an involuntary case, under any applicable bankruptcy, insolvency or other similar law now or hereinafter in effect; or any other similar relief shall be granted under any applicable federal, state, local or foreign law; or the board of directors of GGP, Inc. or the partners or members, as the case may be, of the Borrower or the board of directors, partners or members of any of the Borrower's Subsidiaries to which more than $50,000,000 of the Capitalization Value is attributable (or any committee thereof) adopts any resolution or otherwise authorizes any action to approve any of the foregoing. (ii) A decree or order of a court having jurisdiction in the premises for the appointment of a receiver, liquidator, sequestrator, trustee, custodian or other officer having similar powers over the Borrower, or any of their respective Subsidiaries to which more than $50,000,000 of the Capitalization Value is attributable, or over all or a substantial part of the Property of any of the Borrower or any of such Subsidiaries shall be entered; or an interim receiver, trustee or other custodian of any of the Borrower or any of such Subsidiaries or of all or 70 a substantial part of the Property of any of the Borrower or any of such Subsidiaries shall be appointed or a warrant of attachment, execution or similar process against any substantial part of the Property of any of the Borrower or any of such Subsidiaries shall be issued and any such event shall not be stayed, dismissed, bonded or discharged within sixty (60) days after entry, appointment or issuance; or the respective board of directors of any of the Borrower or partners of the Borrower or the board of directors or partners of any of Borrower's Subsidiaries to which more than $50,000,000 of the Capitalization Value is attributable(or any committee thereof) adopts any resolution or otherwise authorizes any action to approve any of the foregoing. (g) Voluntary Bankruptcy; Appointment of Receiver, Etc. Any of the Borrower, or any of their respective Subsidiaries to which more than $50,000,000 of the Capitalization Value is attributable, shall commence a voluntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or shall consent to the entry of an order for relief in an involuntary case, or to the conversion of an involuntary case to a voluntary case, under any such law, or shall consent to the appointment of or taking possession by a receiver, trustee or other custodian for all or a substantial part of its Property; or any of the Borrower or any of such Subsidiaries to which more than $50,000,000 of the Capitalization Value is attributable shall make any assignment for the benefit of creditors or shall be unable or fail, or admit in writing its inability, generally to pay its debts as such debts become due. (h) Judgments and Unpermitted Liens. (i) Any money judgment (other than a money judgment covered by insurance as to which the insurance company has acknowledged coverage), writ or warrant of attachment, or similar process against the Borrower or any of its Subsidiaries or any of its respective assets involving in any event an amount in excess of $15,000,000 (other than with respect to Claims arising out of nonrecourse Indebtedness) is entered and shall remain undischarged, unvacated, unbonded or unstayed for a period of sixty (60) days or in any event later than five (5) days prior to the date of any proposed sale thereunder. (ii) A federal, state, local or foreign tax Lien (other than a Lien permitted by Section 10.2 of this Agreement or a Lien relating to taxes being contested pursuant to Section 9.4 of this Agreement) is filed against the Borrower which is not discharged of record, bonded over or otherwise secured to the satisfaction of the Administrative Agent within thirty (30) days after the filing thereof or the date upon which the Administrative Agent receives actual knowledge of the filing thereof for an amount which, either separately or when aggregated with the amount of any judgments described in clause (i) above and/or the amount of the Environmental Lien Claims described in clause (iii) below, equals or exceeds $15,000,000. (iii) An Environmental Lien is filed against any Real Property with respect to Claims in an amount which, either separately or when aggregated with the amount of any judgments described in clause (i) above and/or the amount of the tax Liens described in clause (ii) above, equals or exceeds $15,000,000. 71 (i) Dissolution. Any order, judgment or decree shall be entered against the Borrower decreeing its involuntary dissolution or split up; or the Borrower shall otherwise dissolve or cease to exist except as specifically permitted by this Agreement. (j) Loan Documents. At any time, for any reason, any Loan Document ceases to be in full force and effect or the Borrower seeks to repudiate its obligations thereunder. (k) ERISA Termination Event. Any ERISA Termination Event occurs which the Administrative Agent reasonably believes could subject either the Borrower or any ERISA Affiliate to liability in excess of $1,000,000. (l) Waiver Application. The plan administrator of any Benefit Plan applies under Section 412(d) of the Internal Revenue Code for a waiver of the minimum funding standards of Section 412(a) of the Internal Revenue Code and the Administrative Agent reasonably believes that the substantial business hardship upon which the application for the waiver is based could subject either the Borrower or any ERISA Affiliate to liability in excess of $1,000,000. (m) Certain Defaults Pertaining to GGP, Inc. GGP, Inc. shall fail to (i) maintain its status as a REIT for federal income tax purposes, (ii) continue as a general partner of the Partnership, (iii) comply in all material respects with all Requirements of Law applicable to it and its businesses and Properties, in each case where the failure to so comply individually or in the aggregate will have or is reasonably likely to have a Material Adverse Effect, (iv) remain listed on the New York Stock Exchange or other national stock exchange, or (v) file all tax returns and reports required to be filed by it with any Governmental Authority as and when required to be filed or to pay any taxes, assessments, fees or other governmental charges upon it or its Property, assets, receipts, sales, use, payroll, employment, licenses, income, or franchises which are shown in such returns, reports or similar statements to be due and payable as and when due and payable, except for taxes, assessments, fees and other governmental charges (A) that are being contested by GGP, Inc. in good faith by an appropriate proceeding diligently pursued, (B) for which adequate reserves have been made on its books and records, and (C) the amounts the nonpayment of which would not, individually or in the aggregate, result in a Material Adverse Effect. (n) Merger or Liquidation of the Borrower. GGP, Inc. or the Borrower shall merge or liquidate with or into any other Person and, as a result thereof and after giving effect thereto, (i) GGP, Inc. or the Borrower, as applicable is not the surviving Person or (ii) such merger or liquidation would effect an acquisition of or Investment in any Person not otherwise permitted under the terms of this Agreement. An Event of Default shall be deemed "continuing" until cured or waived in writing in accordance with Section 15.7. 72 11.2 Rights and Remedies. (a) Acceleration and Termination. Upon the occurrence of any Event of Default described in Sections 11.1(f) or 11.1(g), the Revolving Credit Commitments shall automatically and immediately terminate and the unpaid principal amount of, and any and all accrued interest on, the Obligations and all accrued fees shall automatically become immediately due and payable, without presentment, demand, or protest or other requirements of any kind (including, without limitation, valuation and appraisement, diligence, presentment, notice of intent to demand or accelerate and of acceleration), all of which are hereby expressly waived by the Borrower; and upon the occurrence and during the continuance of any other Event of Default, the Administrative Agent shall at the request, or may with the consent, of the Requisite Lenders, by written notice to the Borrower, (i) declare that the Revolving Credit Commitments are terminated, whereupon the Revolving Credit Commitments and the obligation of each Lender to make any Loan hereunder shall immediately terminate, and/or (ii) declare the unpaid principal amount of and any and all accrued and unpaid interest on the Obligations to be, and the same shall thereupon be, immediately due and payable, without any other presentment, demand, or protest or other requirements of any kind (including, without limitation, valuation and appraisement, diligence, presentment, notice of intent to demand or accelerate and of acceleration), all of which are hereby expressly waived by the Borrower. (b) Rescission. If at any time after termination of the Revolving Credit Commitments and/or acceleration of the maturity of the Loans, the Borrower shall pay all arrears of interest and all payments on account of principal of the Loans which shall have become due otherwise than by acceleration (with interest on principal and, to the extent permitted by law, on overdue interest, at the rates specified in this Agreement) and all Events of Default and Potential Events of Default (other than nonpayment of principal of and accrued interest on the Loans due and payable solely by virtue of acceleration) shall be remedied or waived pursuant to Section 15.7, then upon the written consent of the Requisite Lenders and written notice to the Borrower, the termination of the Revolving Credit Commitments and/or the acceleration and the consequences thereof may be rescinded and annulled; but such action shall not affect any subsequent Event of Default or Potential Event of Default or impair any right or remedy consequent thereon. The provisions of the preceding sentence are intended merely to bind the Lenders to a decision which may be made at the election of the Requisite Lenders; they are not intended to benefit the Borrower and do not give the Borrower the right to require the Lenders to rescind or annul any acceleration hereunder, even if the conditions set forth herein are met. (c) Enforcement. The Borrower acknowledges that in the event the Borrower fails to perform, observe or discharge any of its obligations or liabilities under this Agreement or any other Loan Document, any remedy of law may prove to be inadequate relief to the Administrative Agent and the other Lenders; therefore, the Borrower agrees that the Administrative Agent and the other Lenders shall be entitled to temporary and permanent injunctive relief in any such case without the necessity of proving actual damages. ARTICLE XII - THE AGENT 73 12.1 Appointment. Bank of America is hereby irrevocably appointed Administrative Agent hereunder and under each other Loan Document, and each of the Lenders irrevocably authorizes the Administrative Agent to act as the agent of such Lender. The Administrative Agent agrees to act as such upon the express conditions contained in this Article XII. The Administrative Agent shall not have any duties or responsibilities to the Lenders except those expressly set forth herein and shall not have a fiduciary relationship in respect of any Lender by reason of this Agreement. USB and Dresdner are hereby irrevocably appointed as the Syndication Agent and Documentation Agent, respectively, for the Lenders. Neither the Documentation Agent nor the Syndication Agent shall have any fiduciary relationship in respect of any Lender by reason of this Agreement, or any duties or responsibilities to the Lenders in that capacity, in connection with the administration of the Facility or otherwise. 12.2 Powers. The Administrative Agent shall have and may exercise such powers under the Loan Documents as are specifically delegated to the Administrative Agent by the terms of each thereof, together with such powers as are reasonably incidental thereto (but subject to Section 15.7 below). The Administrative Agent shall have no implied duties, obligations or liabilities to the Lenders, or any obligation to the Lenders to take any action thereunder except any action specifically provided by the Loan Documents to be taken by the Administrative Agent. Only the Administrative Agent may perform the duties reserved to it under the Loan Documents and no Lender shall act or purport to act on behalf of the other Lenders or Administrative Agent on any such matters. Without limiting the generality of the foregoing: (a) The Administrative Agent shall have the exclusive right to collect from Borrower and any Guarantor, or third parties, on account of the Facility, including, principal, interest, fees, protective advances and prepayment premiums (if any), whether such sums are received directly from Borrower, any guarantor (including, without limitation, GGP, Inc., as the guarantor under the Guaranty) or any other Persons, or are obtained by right of offset by the Administrative Agent of any kind, or by enforcement of the Loan Documents. The Administrative Agent will receive and hold all collections with respect to the Loan for the benefit of the Lenders in accordance with their respective Pro Rata Shares or as otherwise provided herein. (b) If any Lender shall receive any payments or property in connection with the Facility (whether or not voluntary), from any Person other than the Administrative Agent, such Lender shall transfer to the Administrative Agent all such payments or property within one (1) Business Day of receipt. (c) No Lender shall independently initiate any judicial action or other proceeding against Borrower or any Guarantor with respect to the Facility. 12.3 General Immunity. None of the Co-Arrangers nor any of their respective directors, officers, agents or employees shall be liable to the Borrower or the Lenders for any action taken or omitted to be taken by it or them hereunder or under any other Loan Document or in connection herewith or therewith, except for its or their own gross negligence or willful misconduct. 74 12.4 No Responsibility for Loans, Recitals, etc. None of the Co-Arrangers nor any of their respective directors, officers, agents or employees shall be responsible for or have any duty to ascertain, inquire into, or verify (i) any statement, warranty or representation made in connection with any Loan Document or any Borrowing hereunder; (ii) the performance or observance of any of the covenants or agreements of any obligor under any Loan Document; (iii) the satisfaction of any condition specified in Article VI, except receipt of items required to be delivered to the Administrative Agent; or (iv) the validity, effectiveness or genuineness of any Loan Document or any other instrument or writing furnished in connection therewith. 12.5 Action on Instructions of Lenders. The Administrative Agent shall in all cases be fully protected by the Lenders, as against any claim or other action of any kind or nature whatsoever by any Lender, in acting, or in refraining from acting, hereunder and under any other Loan Document in accordance with written instructions signed by the Requisite Lenders (or, in the case of any waiver or amendment listed in Section 15.7(b) hereof, all of the Lenders) and such instructions and any action taken or failure to act pursuant thereto shall be binding on all of the Lenders and on all Holders. As between the Administrative Agent and the Lenders, the Administrative Agent shall be fully justified in failing or refusing to take any action hereunder and under any other Loan Document unless it shall first receive such advice or concurrence, if it so requests, of the Requisite Lenders and shall first be indemnified to its satisfaction by the Lenders in accordance with their respective Pro Rata Shares against any and all liability, cost and expense that it may incur by reason of taking or continuing to take any such action. 12.6 Employment of Administrative Agents and Counsel. Each of the Co- Arrangers may execute any of its duties as Administrative Agent, Documentation Agent or Syndication Agent (as the case may be) hereunder and under any other Loan Document by or through employees, agents and attorneys-in-fact and shall not be answerable to the Lenders, except as to money or securities received by it or its authorized agents, for the default or misconduct of any such agents or attorneys-in-fact selected by it with reasonable care. As between each of the Co-Arrangers, on the one hand, and the Lenders, on the other hand, such Co- Arranger shall be entitled to engage and rely upon advice of legal counsel (including the Borrower's counsel), independent accountants and other professionals and experts selected by the such Co-Arranger concerning all matters pertaining to its agency hereby created and its duties hereunder and under any other Loan Document. 12.7 Reliance on Documents. The Administrative Agent shall be entitled to rely upon any Note or other Loan Document, writing, notice, consent, certificate, facsimile, affidavit, letter, telegram, statement, paper, document or other communication believed by it to be genuine and correct and to have been signed, sent or otherwise communicated by the proper person or persons. 12.8 Administrative Agent's Reimbursement and Indemnification'. The Lenders, ratably in accordance with their respective Pro Rata Shares, agree to reimburse and indemnify upon demand each of the Co-Arrangers (i) for any amounts not reimbursed by the Borrower for which such Co-Arranger is entitled to reimbursement by the Borrower under the Loan Documents, (ii) for any other expenses (including reasonable attorneys' fees) incurred by such Co-Arranger on behalf of the Lenders, in connection with the preparation, execution, delivery, 75 administration, modification and enforcement of the Loan Documents, if not paid by Borrower, and (iii) for any liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind and nature whatsoever which may be imposed on, incurred by or asserted against such Co-Arranger in any way relating to or arising out of the Loan Documents or any other document delivered in connection therewith or the transactions contemplated thereby, or the enforcement of any of the terms thereof or of any such other documents, provided that no Lender shall be liable for any of the foregoing to the extent they arise from the gross negligence or willful misconduct of such Co-Arranger. Each Lender shall indemnify each of the Co-Arrangers and each of the other Lenders with respect to claims, liabilities, damages, costs, losses and expenses (including, without limitation, attorneys' fees) arising from or relating to the failure of such indemnifying Lender to satisfy its obligations under this Agreement and the other Loan Documents. No Co-Arranger shall have any liability or obligation hereunder with respect to any negligence or misconduct of any other Co-Arranger. 12.9 Rights as a Lender. With respect to the Loans made by it, the Note issued to it and otherwise, each of the Co-Arrangers shall have the same rights and powers hereunder and under any other Loan Document as any Lender and may exercise the same as though it were not one of the Co-Arrangers, and the term "Lender" or "Lenders" shall, unless the context otherwise indicates, include each of the Co-Arrangers in its capacity as a Lender. Each of the Co-Arrangers, in its capacity as a Lender, may accept deposits from, lend money to, and generally engage in any kind of trust, debt, equity or other transaction, in addition to those contemplated by this Agreement or any other Loan Document, with the Borrower in which the Borrower is not restricted hereby from engaging with any other Person. The Lenders acknowledge that each of the Co-Arrangers and their respective Affiliates now or in the future may have banking or other financial relationships, including being an agent on other loans, with Borrower and its Affiliates, as though it were not one of the Co-Arrangers hereunder and without notice to or consent of the Lenders. Each Lender hereby expressly waives any objection to such actual or potential conflict of interest. The Lenders acknowledge that in the course of such activities, any of the Co- Arrangers or their respective Affiliates may receive information regarding the Borrower or its Affiliates and acknowledge that none of the Co-Arrangers shall be under any obligation to provide such information to them, whether or not confidential. 12.10 Lender Credit Decision. Each Lender acknowledges that none of the Co-Arrangers nor any of their respective agents has made any representation or warranty to such Lender and that no action or statement hereafter made or taken by any of the Co-Arrangers or any of their respective agents shall be deemed to be representation or warranty by any other of the Co-Arrangers to such Lenders. Each Lender further acknowledges that it has, independently and without reliance upon any of the Co-Arrangers or any other Lender and based on the financial statements prepared by the Borrower and such other documents and information as such Lender has deemed appropriate, made its own credit analysis and decision to enter into this Agreement and the other Loan Documents. Each Lender also acknowledges that it will, independently and without reliance upon any of the Co-Arrangers or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis and decisions in taking or not taking action under this Agreement and the other Loan Documents. 76 12.11 Successor Administrative Agent. Each Lender agrees that Bank of America shall serve as the Administrative Agent at all times during the Term of this Facility, except that of Bank of America may resign from its agency at any time, in its sole discretion, upon thirty (30) days' prior written notice to the Lenders and the Borrower. If the Administrative Agent is permitted to (in accordance with the terms of this Agreement) and does participate or assign its total interests in the Facility, other than to a successor entity to the Administrative Agent, then the Administrative Agent agrees to resign upon the request of any Lender or the Borrower. Upon any such resignation, the other Lenders shall have the right to appoint, on behalf of the Borrower and the Lenders, a successor Administrative Agent, which successor Administrative Agent, other than a successor entity to the Administrative Agent, shall, so long as no Event of Default exists hereunder, be subject to the approval of the Borrower (such approval not to be unreasonably withheld or delayed). If no successor Administrative Agent shall have been so appointed by the other Lenders (and, if applicable, approved by Borrower) and shall have accepted such appointment within thirty (30) days after the retiring Administrative Agent's giving notice of resignation, then the retiring Administrative Agent may appoint, on behalf of the Borrower and the Lenders, a successor Administrative Agent, which successor Administrative Agent, other than a successor entity to the Administrative Agent, shall, so long as no Event of Default exists hereunder, be subject to the approval of Borrower (such approval not to be unreasonably withheld or delayed). Such successor Administrative Agent shall be a commercial bank having capital and retained earnings of at least $1,000,000,000. Upon the acceptance of any appointment as Administrative Agent hereunder by a successor Administrative Agent, such successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent, including the right to receive any fees for performing such duties which accrue thereafter, and the retiring Administrative Agent shall be discharged from its duties and obligations subsequently arising hereunder and under the other Loan Documents. After any retiring Administrative Agent's resignation hereunder as Administrative Agent, the provisions of this Article XII shall continue in effect for its benefit and that of the other Lenders in respect of any actions taken or omitted to be taken by it while it was acting as the Administrative Agent hereunder and under the other Loan Documents. 12.12 Notice of Defaults. If a Lender becomes aware of a Potential Event of Default or Event of Default, such Lender shall notify the Administrative Agent of such fact. Upon receipt of such notice that a Potential Event of Default or Event of Default has occurred, the Administrative Agent shall notify each of the Lenders of such fact. Except for defaults in the payment of principal, interest and fees payable to Administrative Agent for the account of the Lenders and such other Obligations for which Administrative Agent is expressly responsible for determining the Borrower's compliance, Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Potential Event of Default or Event of Default, unless Administrative Agent shall have received written notice from a Lender or the Borrower referring to the Loan, describing such Potential Event of Default or Event of Default and stating that such notice is a "notice of default". Administrative Agent will notify the Lenders of its receipt of any such notice. Administrative Agent shall take action with respect to such Potential Event of Default or Event of Default in accordance with the provisions of this Agreement and the Loan Documents. 77 12.13 Requests for Approval. If the Administrative Agent requests in writing the consent or approval of a Lender, whether or not such consent or approval is required hereunder (and no such requirement shall be inferred from any such request), such Lender shall respond and either approve or disapprove definitively in writing to the Administrative Agent within ten (10) Business Days (or sooner if such notice specifies a shorter period based on Administrative Agent's good faith determination that circumstances warrant an earlier response) after such written request from the Administrative Agent. If any Lender does not so respond, that Lender shall be deemed to have approved the request. Upon request, the Administrative Agent shall notify the Lenders which Lenders, if any, failed to respond to a request for approval. 12.14 Copies of Documents. Administrative Agent shall promptly deliver to each of the Lenders copies of all notices of default and other formal notices sent to or received by the Administrative Agent pursuant to Section 15.1 of this Agreement. Within fifteen (15) Business Days after a request by a Lender to the Administrative Agent for other documents furnished to the Administrative Agent by the Borrower, the Administrative Agent shall provide copies of such documents to such Lender except where this Agreement obligates Administrative Agent to provide copies in a shorter period of time. 12.15 Withholding Tax. All taxes due and payable on any payments to be made to a Lender under this Agreement shall be such Lender's sole responsibility, except to the extent such taxes are actually reimbursed by the Borrower under the Loan Documents. All payments to be made to each Lender under this Agreement shall be made after deduction for any taxes, charges, levies or withholdings which are imposed by the country of organization of the Borrower, the United States of America or any other applicable taxing authority. Each Lender agrees to provide to Administrative Agent completed and signed copies of any forms that may be required by the IRS (and any applicable state authority) in order to certify such Lender's exemption from or reduction of United States (or applicable state) withholding taxes with respect to payments to be made to such Lender under this Agreement or the Loan Documents. Each Lender agrees to promptly notify Administrative Agent of any change which would modify or render invalid any claimed exemption or reduction. If any governmental authority of the United States or other jurisdiction asserts a claim that Administrative Agent did not properly withhold tax from amounts paid to or for the account of any Lender, such Lender shall indemnify Administrative Agent fully for all amounts paid by Administrative Agent as tax or otherwise, including penalties and interest, and including any taxes imposed by any jurisdiction on the amount payable to Administrative Agent under this section, together with all costs and expenses (including legal expenses). The obligation of the Lenders under this subsection shall survive the payment of all Obligations and the resignation or replacement of Administrative Agent. 12.16 Borrower's Default; Enforcement'. Upon the occurrence of an Event of Default under any Loan Document, the Requisite Lenders shall have the right, upon written notice to Administrative Agent, to require that Administrative Agent exercise the rights of the Lenders as directed by the Requisite Lenders; provided, however, that the Lenders shall indemnify, exonerate and hold Administrative Agent harmless from and against any and all claims, losses, liabilities, damages and costs (including reasonable legal fees) incurred by Administrative Agent as a result of any such exercise of rights at the direction of the Lenders and not resulting from the gross negligence or willful misconduct of Administrative Agent. 78 12.17 Workout. If an Event of Default has occurred, Administrative Agent may declare by written notice to the Lenders (with a copy to the Borrower) that the Loan is "in workout" (the "Notice of Workout"). The Lenders acknowledge that workouts of defaulted loans usually are resolved by either a borrower cure of the default; or a restructure of or other modification to the loan; or by exercising remedies; and that it is in the interest of the Lenders to attain a resolution within a reasonable period of time. Notwithstanding any action by Administrative Agent under this Section 12.17, Administrative Agent shall follow the direction of the Requisite Lenders under Section 12.16 above at any time. Nevertheless, unless and until the Requisite Lenders shall direct Administrative Agent to the contrary, Administrative Agent shall have the right but not the obligation to take such action as it may deem appropriate to preserve the rights of the Lenders to recover any amounts owing under the Loan Documents, without the consent of the Requisite Lenders. 12.18 Bankruptcy of Borrower. In the event of a bankruptcy by the Borrower, the Lenders shall act through Administrative Agent to petition the court, make any motion for relief from the automatic stay, participate in any appropriate creditors' committee, vote on a plan of reorganization or pursue other remedies or actions in accordance with the approval of the Requisite Lenders. 12.19 Relationship of Parties. This Agreement is not intended to establish a partnership or joint venture between any of the Co-Arrangers, on the one hand, and the Lenders, on the other hand. The provisions of the Loan Documents regarding the relationships among each of the Co-Arrangers and the Lenders and this Article XII are intended solely to facilitate co-lending relationships among the Lenders for the Facility. No security or investment contract under any federal or state law is intended to be created among the Lenders or between any of the Co-Arrangers and the Lenders. The execution of this Agreement, the performance of the terms thereof, and the Lenders' purchase of and ownership interest in the Facility and the Loan Documents shall not constitute any Lender as owner, purchaser or seller of any security (as that term is defined in the Securities Act of 1933 or the Securities Exchange Act of 1934) issued, owned, purchased or sold by Bank of America, Dresdner or USB or any of their Subsidiaries or Affiliates, either as principal or as agent for the Borrower. Each Lender is purchasing and acquiring legal and equitable ownership of its Pro Rata Share and is not making a loan to Bank of America, Dresdner or USB, and no debtor-creditor relationship exists between them as a result of this Agreement. 12.20 Counsel. The Lenders acknowledge that the Co-Arranger's respective counsel have represented and shall represent only the Co-Arrangers, respectively, in their respective capacities as such, in connection with the Loan Documents and this Agreement. Each other Lender shall retain independent legal counsel regarding all such matters, documents and agreements. After an Event of Default, the Lenders shall enter into a joint privilege agreement regarding the exchange of information that is or may be subject to attorney- client privilege or related privileges. The Administrative Agent's counsel shall prepare such joint privilege agreement, subject to the approval of the Requisite Lenders which approval shall not be unreasonably withheld by any Lender. ARTICLE XIII - YIELD PROTECTION 79 13.1 Taxes. (a) Payment of Taxes. Any and all payments by the Borrower hereunder or under any Note or other document evidencing any Obligations shall be made, in accordance with Section 4.2, free and clear of and without reduction for any and all present or future taxes, levies, imposts, deductions, charges, withholdings, and all stamp or documentary taxes, excise taxes, ad valorem taxes and other taxes imposed on the value of the Property, charges or levies which arise from the execution, delivery or registration, or from payment or performance under, or otherwise with respect to, any of the Loan Documents or the Revolving Credit Commitments and all other liabilities with respect thereto excluding, in the case of each Lender, taxes imposed on or measured by net income or overall gross receipts and capital and franchise taxes imposed on it by (i) the United States, (ii) the Governmental Authority of the jurisdiction in which such Lender's Applicable Lending Office is located or any political subdivision thereof or (iii) the Governmental Authority of the jurisdiction in which such Person is organized, managed and controlled or any political subdivision thereof (all such nonexcluded taxes, levies, imposts, deductions, charges and withholdings being hereinafter referred to as "Taxes"). If the Borrower shall be required by law to withhold or deduct any Taxes from or in respect of any sum payable hereunder or under any such Note or document to any Lender, (x) the sum payable to such Lender shall be increased as may be necessary so that after making all required withholding or deductions (including withholding or deductions applicable to additional sums payable under this Section 13.1) such Lender receives an amount equal to the sum it would have received had no such withholding or deductions been made, (y) the Borrower shall make such withholding or deductions, and (z) the Borrower shall pay the full amount withheld or deducted to the relevant taxation authority or other authority in accordance with applicable law. Notwithstanding the foregoing, in the event that any Lender is or becomes so subject to such Taxes, at Borrower's sole election, Borrower may identify an Eligible Assignee not so subject to such Taxes to whom the Lender which is so subject shall assign its interest in the Loans pursuant to the terms of an Assignment and Acceptance substantially in the form attached as Exhibit A. (b) Indemnification. The Borrower will indemnify each Lender against, and reimburse each on demand for, the full amount of all Taxes (including, without limitation, any Taxes imposed by any Governmental Authority on amounts payable under this Section 13.1 resulting therefrom) incurred or paid by such Lender or any of its respective Affiliates and any liability (including penalties, interest, and out-of-pocket expenses paid to third parties) arising therefrom or with respect thereto, whether or not such Taxes were lawfully payable. A certificate as to any additional amount payable to any Person under this Section 13.1 submitted by a Lender to the Borrower shall, absent manifest error, be final, conclusive and binding upon all parties hereto. Each Lender agrees, within a reasonable time after receiving a written request from the Borrower, to provide the Borrower and the Administrative Agent with such certificates as are reasonably required, and take such other actions as are reasonably necessary to claim such exemptions as such Lender may be entitled to claim in respect of all or a portion of any Taxes which are otherwise required to be paid or deducted or withheld pursuant to this Section 13.1 in respect of any payments under this Agreement or under the Notes. 80 (c) Receipts. Within thirty (30) days after the date of any payment of Taxes by the Borrower, it will furnish to the Administrative Agent, at its address referred to in Section 15.8, the original or a certified copy of a receipt evidencing payment thereof. (d) Foreign Bank Certifications. (i) Each Lender that is not created or organized under the laws of the United States or a political subdivision thereof shall deliver to the Borrower and the Administrative Agent on the Closing Date or the date on which such Lender becomes a Lender pursuant to Section 15.1 hereof a true and accurate certificate executed in duplicate by a duly authorized officer of such Lender to the effect that such Lender is eligible to receive payments hereunder and under the Notes without deduction or withholding of United States federal income tax (I) under the provisions of an applicable tax treaty concluded by the United States (in which case the certificate shall be accompanied by two duly completed copies of IRS Form 1001 (or any successor or substitute form or forms)) or (II) under Sections 1442(c)(1) and 1442(a) of the Internal Revenue Code (in which case the certificate shall be accompanied by two duly completed copies of IRS Form 4224 (or any successor or substitute form or forms)). (ii) Each Lender further agrees to deliver to the Borrower and the Administrative Agent from time to time, a true and accurate certificate executed in duplicate by a duly authorized officer of such Lender before or promptly upon the occurrence of any event requiring a change in the most recent certificate previously delivered by it to the Borrower and the Administrative Agent pursuant to this Section 13.1(d). Each certificate required to be delivered pursuant to this Section 13.1(d)(ii) shall certify as to one of the following: (A) that such Lender can continue to receive payments hereunder and under the Notes without deduction or withholding of United States federal income tax; (B) that such Lender cannot continue to receive payments hereunder and under the Notes without deduction or withholding of United States federal income tax as specified therein but does not require additional payments pursuant to Section 13.1(a) because it is entitled to recover the full amount of any such deduction or withholding from a source other than the Borrower; or (C) that such Lender is no longer capable of receiving payments hereunder and under the Notes without deduction or withholding of United States federal income tax as specified therein and that it is not capable of recovering the full amount of the same from a source other than the Borrower. Each Lender agrees to deliver to the Borrower and the Administrative Agent further duly completed copies of the above-mentioned IRS forms on or before the earlier of (x) the date that any such form expires or becomes obsolete or otherwise is required to be resubmitted as a condition to obtaining an exemption from withholding from United States federal income tax and (y) fifteen (15) days after the occurrence of any event requiring a change in the most recent form previously delivered by such Lender to the Borrower and Administrative Agent, unless any change in treaty, law, regulation, or official interpretation thereof which would render such form 81 inapplicable or which would prevent the Lender from duly completing and delivering such form has occurred prior to the date on which any such delivery would otherwise be required and the Lender promptly advises the Borrower that it is not capable of receiving payments hereunder and under the Notes without any deduction or withholding of United States federal income tax. 13.2 Increased Capital. If after the date hereof any Lender determines that (i) the adoption or implementation of or any change in or in the interpretation or administration of any law or regulation or any guideline or request from any central bank or other Governmental Authority or quasi- governmental authority exercising jurisdiction, power or control over any Lender or banks or financial institutions generally (whether or not having the force of law), compliance with which affects or would affect the amount of capital required or expected to be maintained by such Lender or any corporation controlling such Lender and (ii) the amount of such capital is increased by or based upon the making or maintenance by any Lender of its Loans, any Lender's participation in or obligation to participate in the Loans or other advances made hereunder or the existence of any Lender's obligation to make Loans, then, in any such case, within thirty (30) days after written demand by such Lender (with a copy of such demand to the Administrative Agent), the Borrower shall pay to the Administrative Agent for the account of such Lender, from time to time as specified by such Lender, additional amounts sufficient to compensate such Lender or such corporation therefor. Such demand shall be accompanied by a statement as to the amount of such compensation and include a brief summary of the basis for such demand. Such statement shall be conclusive and binding for all purposes, absent manifest error. Notwithstanding the foregoing, in the event of any such demand, at Borrower's sole election, Borrower may identify an Eligible Assignee not making such a demand to whom the demanding Lender shall assign its interest in the Loans pursuant to the terms of an Assignment and Acceptance substantially in the form attached as Exhibit A. 13.3 Changes; Legal Restrictions. If after the date hereof any Lender determines that the adoption or implementation of or any change in or in the interpretation or administration of any law or regulation or any guideline or request from any central bank or other Governmental Authority or quasi- governmental authority exercising jurisdiction, power or control over any Lender, or over banks or financial institutions generally (whether or not having the force of law), compliance with which: (a) does or will subject a Lender (or its Applicable Lending Office or Eurodollar Affiliate) to charges (other than taxes) of any kind which such Lender reasonably determines to be applicable to the Revolving Credit Commitments of the Lenders to make Eurodollar Rate Loans or change the basis of taxation of payments to that Lender of principal, fees, interest, or any other amount payable hereunder with respect to Eurodollar Rate Loans; or (b) does or will impose, modify, or hold applicable, in the reasonable determination of a Lender, any reserve (other than reserves taken into account in calculating the Eurodollar Rate), special deposit, compulsory loan, FDIC insurance or similar requirement against assets held by, or deposits or other liabilities in or for the account of, advances or loans by, commitments made, or other credit extended by, or any other acquisition of funds by, a Lender or any Applicable Lending Office or Eurodollar Affiliate of that Lender; 82 and the result of any of the foregoing is to increase the cost to that Lender of making, renewing or maintaining the Loans or its Revolving Credit Commitment or to reduce any amount receivable thereunder; then, in any such case, within thirty (30) days after written demand by such Lender (with a copy of such demand to the Administrative Agent), the Borrower shall pay to the Administrative Agent for the account of such Lender, from time to time as specified by such Lender, such amount or amounts as may be necessary to compensate such Lender or its Eurodollar Affiliate for any such additional cost incurred or reduced amount received. Such demand shall be accompanied by a statement as to the amount of such compensation and include a brief summary of the basis for such demand. Such statement shall be conclusive and binding for all purposes, absent manifest error. Notwithstanding the foregoing, in the event of any such demand, at Borrower's sole election, Borrower may identify an Eligible Assignee not making such a demand to whom the demanding Lender shall assign its interest in the Loans pursuant to the terms of an Assignment and Acceptance substantially in the form attached as Exhibit A. ARTICLE XIV - BENEFIT OF LOANS The Borrower represents and warrants to the Lenders: (i) that the financing provided for herein is for the mutual benefit of both the Partnership and the Company; and (ii) that the pricing, terms and conditions of the financing provided for herein are more favorable than those that the Company could reasonably expect to obtain were it to seek alternative financing independently of the Partnership. ARTICLE XV - MISCELLANEOUS 15.1 Assignments and Participations. (a) Assignments. No assignments or participations of any Lender's rights or obligations under this Agreement shall be made except in accordance with this Section 15.1. Each Lender may assign to one or more Eligible Assignees all or, except as otherwise provided in subsection (b) below, a portion of its rights and obligations under this Agreement in accordance with the provisions of this Section 15.1. (b) Limitations on Assignments. For so long as no Event of Default has occurred and is continuing, each assignment shall be subject to the following conditions: (i) each assignment shall be of a constant, and not a varying, ratable percentage of all of the assigning Lender's rights and obligations under this Agreement and, in the case of a partial assignment, shall be in a minimum principal amount of at least $20,000,000, (ii) each such assignment shall be to an Eligible Assignee approved by the Administrative Agent and, so long as no Event of Default shall have occurred and be continuing hereunder, by the Borrower (which approval shall not be unreasonably withheld, conditioned or delayed by the Administrative Agent or the Borrower), (iii) the parties to each such assignment shall execute and deliver to the Administrative Agent, for its acceptance and recording in the Register, an Assignment and Acceptance, and (iv) each Lender shall maintain a minimum Revolving Credit Commitment of at least $20,000,000; provided, however, that, within six (6) months after the date hereof, one Eligible Assignee may become a Lender hereunder pursuant to a Joinder Agreement providing for a Revolving Credit Commitment in an amount less than $20,000,000, but not less than 83 $15,000,000, and such Lender (and its permitted assigns) may thereafter assign all, but not less than all, of its rights and obligations hereunder to an Eligible Assignee in accordance with all of the other requirements hereof, all without regard to the requirement as to dollar amount of the foregoing clause (i) or clause (iv); and provided further that, following the occurrence and during the continuation of an Event of Default hereunder, none of the foregoing restrictions on assignments shall apply, and, notwithstanding any subsequent cure or elimination of such Event of Default, neither the assignee nor the assignor in any assignment made during the continuance of such Event of Default shall thereafter be required to cause such assignment or any condition or state of affairs resulting therefrom to satisfy the foregoing requirements. Upon such execution, delivery, acceptance and recording in the Register, from and after the effective date specified in each Assignment and Acceptance and agreed to by the Administrative Agent, (A) the assignee thereunder shall, in addition to any rights and obligations hereunder held by it immediately prior to such effective date, if any, have the rights and obligations hereunder that have been assigned to it pursuant to such Assignment and Acceptance and shall, to the fullest extent permitted by law, have the same rights and benefits hereunder as if it were an original Lender hereunder, (B) the assigning Lender shall, to the extent that rights and obligations hereunder have been assigned by it pursuant to such Assignment and Acceptance, relinquish its rights and be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all or the remaining portion of such assigning Lender's rights and obligations under this Agreement, the assigning Lender shall cease to be a party hereto) and (C) the Borrower shall execute and deliver to the assignee thereunder a Note evidencing its obligations to such assignee with respect to the Loans upon the cancellation or amendment of the original thereby being replaced. (c) The Register. The Administrative Agent shall maintain at its address referred to in Section 15.8 a copy of each Assignment and Acceptance delivered to and accepted by it and a register (the "Register") for the recordation of the names and addresses of the Lenders, the Revolving Credit Commitment of, and the principal amount of the Loans under the Revolving Credit Commitments owing to, each Lender from time to time and whether such Lender is an original Lender, a Lender pursuant to a Joinder Agreement or the assignee of another Lender pursuant to an Assignment and Acceptance. The entries in the Register shall be conclusive and binding for all purposes, absent manifest error, and the Borrower and each of its Subsidiaries, GGP, Inc., the Administrative Agent and the other Lenders may treat each Person whose name is recorded in the Register as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by the Borrower or any Lender at any reasonable time and from time to time upon reasonable prior notice. (d) Fee. Upon its receipt of an Assignment and Acceptance executed by the assigning Lender and an Eligible Assignee and a processing and recordation fee of $3,500 (payable by the assignee to the Administrative Agent), the Administrative Agent shall, if such Assignment and Acceptance has been completed and is in compliance with this Agreement and in substantially the form of Exhibit A hereto, (i) accept such Assignment and Acceptance, (ii) record the information contained therein in the Register and (iii) give prompt notice thereof to the Borrower and the other Lenders; provided, however that no such processing and recordation fee shall be payable in connection with an assignment to an Affiliate of a Lender. 84 (e) Participations. Each Lender may sell participations to one or more other financial institutions in or to all or a portion of its rights and obligations under and in respect of any and all facilities under this Agreement (including, without limitation, all or a portion of any or all of its Revolving Credit Commitment hereunder and the Loans owing to it); Provided, however, that (i) such Lender's obligations under this Agreement (including, without limitation, its Revolving Credit Commitment hereunder) shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, (iii) the Borrower, the Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement, (iv) each participation shall be in a minimum amount of $10,000,000, and (v) such participant's rights to agree or to restrict such Lender's ability to agree to the modification, waiver or release of any of the terms of the Loan Documents, to consent to any action or failure to act by any party to any of the Loan Documents or any of their respective Affiliates, or to exercise or refrain from exercising any powers or rights which any Lender may have under or in respect of the Loan Documents, shall be limited to the right to consent to (A) increase in the Revolving Credit Commitment of the Lender from whom such participant purchased a participation, (B) reduction of the principal of, or rate or amount of interest on the Loans subject to such participation (other than by the payment or prepayment thereof), (C) postponement of any date fixed for any payment of principal of, or interest on, the Loan(s) subject to such participation and (D) release of any guarantor of the Obligations. (f) Certain Transfers. Notwithstanding the foregoing or anything to the contrary contained herein (other than Section 15.1(b)(i) and Section 15.1(b)(iv), to which any transaction described in this Section 15.1(f) shall be subject) any of the Co-Arrangers may, from time to time in its sole discretion, without the consent of the Borrower or the Administrative Agent and without the payment of any fee, assign, pledge, convey, sell participations or otherwise sell or transfer, in one or more transactions and in whole or in part, any of its Loans, Revolving Credit Commitment, rights to payment of principal, interest or fee and other rights or interests created or existing under this Agreement (including any rights to any related collateral), to any Affiliate or branch of such Co-Arranger, or to any trust or special purpose funding vehicle, whether or not such Co-Arranger maintains any interest in such trust or special funding vehicle; provided, however, that no such assignment, pledge, conveyance, sale of participations or other sale or transfer shall cause the Borrower or any other party hereto to incur any greater expense or liability than the Borrower or such other party hereto would have incurred had no such assignment, pledge, conveyance, sale of participations or other sale or transfer occurred. (g) Information Regarding the Borrower. Any Lender may, in connection with any assignment or participation or proposed assignment or participation pursuant to this Section 15.1, disclose to the assignee or participant or proposed assignee or participant, any information relating to the Borrower or its Subsidiaries furnished to such Lender by the Administrative Agent or by or on behalf of the Borrower; provided, that, prior to any such disclosure, such assignee or participant, or proposed assignee or participant, shall agree, in writing, to preserve in accordance with Section 15.20 the confidentiality of any confidential information described therein. (h) Payment to Participants. Anything in this Agreement to the contrary notwithstanding, in the case of any participation, all amounts payable by the Borrower under the 85 Loan Documents shall be calculated and made in the manner and to the parties required hereby as if no such participation had been sold. (i) Lenders' Creation of Security Interests. Notwithstanding any other provision set forth in this Agreement, any Lender may at any time create a security interest in all or any portion of its rights under this Agreement (including, without limitation, Obligations owing to it and any Note held by it) in favor of any Federal Reserve bank in accordance with Regulation A of the Federal Reserve Board. 15.2 Expenses. -------- (a) Generally. The Borrower agrees upon demand to pay, or reimburse the each of the Co-Arrangers for all of their respective reasonable external audit and investigation expenses and for the reasonable fees, expenses and disbursements of their respective legal counsel and for all other reasonable out-of-pocket costs and expenses of every type and nature incurred by the Co- Arrangers, or any of them, in connection with (i) the audit and investigation of the Consolidated Businesses, the Real Properties and other Properties of the Consolidated Businesses in connection with the preparation, negotiation, and execution of the Loan Documents; (ii) the preparation, negotiation, execution, syndication and interpretation of this Agreement (including, without limitation, the satisfaction or attempted satisfaction of any of the conditions set forth in Article VI), the Loan Documents, and the making of the Loans hereunder; (iii) the ongoing administration of this Agreement and the Loans, including, without limitation, consultation with attorneys in connection therewith and with respect to the Administrative Agent's rights and responsibilities under this Agreement and the other Loan Documents, but excluding any allocation of overhead; (iv) the protection, collection or enforcement of any of the Obligations or the enforcement of any of the Loan Documents; (v) the commencement, defense or intervention in any court proceeding relating in any way to the Obligations, the Borrower, this Agreement or any of the other Loan Documents; (vi) the response to, and preparation for, any subpoena or request for document production with which any of the Co-Arrangers or any other Lender is served or deposition or other proceeding in which any Lender is called to testify, in each case, relating in any way to the Obligations, a Real Property, the Borrower, any of the Consolidated Businesses, this Agreement or any of the other Loan Documents; and (vii) any amendments, consents, waivers, assignments, restatements, or supplements to any of the Loan Documents and the preparation, negotiation, and execution of the same. Notwithstanding anything to the contrary contained herein; (x) as to the negotiation and documentation of this Agreement and the other Loan Documents, the closing pursuant thereto and the matters described in clause (vii) above, the Borrower shall not be required to pay the fees, expenses or disbursements of more than two law firms acting as counsel for the Co- Arrangers or any of them; and (y) as to the other matters described in clauses (i) through (iv) above, the Borrower shall not be required to pay the fees, expenses or disbursements of more than one law firm acting as counsel for the Co-Arrangers or any of them. (b) After Default. The Borrower further agrees to pay or reimburse each of the Co-Arrangers and each of the Lenders upon demand for all out-of- pocket costs and expenses, including, without limitation, reasonable attorneys' fees (including allocated costs of internal counsel and costs of settlement) incurred by such entity after the occurrence of an Event of 86 Default (i) in enforcing any Loan Document or Obligation or any security therefor or exercising or enforcing any other right or remedy available by reason of such Event of Default; (ii) in connection with any refinancing or restructuring of the credit arrangements provided under this Agreement in the nature of a "workout" or in any insolvency or bankruptcy proceeding; (iii) in commencing, defending or intervening in any litigation or in filing a petition, complaint, answer, motion or other pleadings in any legal proceeding relating to the Obligations, a Real Property, any of the Consolidated Businesses and related to or arising out of the transactions contemplated hereby or by any of the other Loan Documents; and (iv) in taking any other action in or with respect to any suit or proceeding (bankruptcy or otherwise) described in clauses (i) through (iii) above. 15.3 Indemnity. The Borrower further agrees (a) to defend, protect, indemnify, and hold harmless each of the Co-Arrangers and each and all of the other Lenders and each of their respective officers, directors, employees, attorneys and agents (including, without limitation, those retained in connection with the satisfaction or attempted satisfaction of any of the conditions set forth in Article VI) (collectively, the "Indemnitees") from and against any and all liabilities, obligations, losses (other than loss of profits), damages, penalties, actions, judgments, suits, claims, costs, reasonable expenses and disbursements of any kind or nature whatsoever (excluding any taxes and including, without limitation, the reasonable fees and disbursements of counsel for such Indemnitees in connection with any investigative, administrative or judicial proceeding, whether or not such Indemnitees shall be designated a party thereto), imposed on, incurred by, or asserted against such Indemnitees in any manner relating to or arising out of this Agreement or the other Loan Documents, or any act, event or transaction related or attendant thereto, the making of the Loans hereunder, the management of such Loans, the use or intended use of the proceeds of the Loans hereunder, or any of the other transactions contemplated by the Loan Documents (collectively, the "Indemnified Matters"); provided, however, the Borrower shall have no obligation to an Indemnitee hereunder with respect to Indemnified Matters caused by or resulting from the willful misconduct or gross negligence of such Indemnitee, as determined by a court of competent jurisdiction in a nonappealable final judgment; and (b) not to assert any claim against any of the Indemnitees, on any theory of liability, for consequential or punitive damages arising out of, or in any way in connection with, the Revolving Credit Commitments, the Revolving Credit Obligations, or the other matters governed by this Agreement and the other Loan Documents. To the extent that the undertaking to indemnify, pay and hold harmless set forth in the preceding sentence may be unenforceable because it is violative of any law or public policy, the Borrower shall contribute the maximum portion which it is permitted to pay and satisfy under applicable law, to the payment and satisfaction of all Indemnified Matters incurred by the Indemnitees. 15.4 Change in Accounting Principles . If any change in the accounting principles used in the preparation of the most recent financial statements referred to in Sections 8.1 or 8.2 are hereafter required or permitted by the rules, regulations, pronouncements and opinions of the Financial Accounting Standards Board or the American Institute of Certified Public Accountants (or successors thereto or agencies with similar functions) and are adopted by the Borrower, as applicable, with the agreement of its independent certified public accountants and such changes result in a change in the method of calculation of any of the covenants, standards or terms found in Article X, the parties hereto agree to enter into negotiations in order to amend such provisions 87 so as to equitably reflect such changes with the desired result that the criteria for evaluating compliance with such covenants, standards and terms by the Borrower shall be the same after such changes as if such changes had not been made; provided, however, that no change in GAAP that would affect the method of calculation of any of the covenants, standards or terms shall be given effect in such calculations until such provisions are amended, in a manner satisfactory to the Administrative Agent and the Borrower, to so reflect such change in accounting principles. 15.5 Setoff. In addition to any rights now or hereafter granted under applicable law, upon the occurrence and during the continuance of any Event of Default, each Lender is hereby authorized by the Borrower at any time or from time to time, without notice to any Person (any such notice being hereby expressly waived) to set off and to appropriate and to apply any and all deposits (general or special, including, but not limited to, indebtedness evidenced by certificates of deposit, whether matured or unmatured (but not including trust accounts)) and any other Indebtedness at any time held or owing by such Lender to or for the credit or the account of the Borrower against and on account of the Obligations of the Borrower then due to such Lender, including, but not limited to, all Loans and all claims of any nature or description arising out of or in connection with this Agreement, irrespective of whether or not (i) such Lender shall have made any demand hereunder or (ii) the Administrative Agent, at the request or with the consent of the Requisite Lenders, shall have declared the principal of and interest on the Loans and other amounts due hereunder to be due and payable as permitted by Article XI and even though such Obligations may be contingent or unmatured. Each Lender agrees that it shall not, without the express consent of the Requisite Lenders, and that it shall, to the extent it is lawfully entitled to do so, upon the request of the Requisite Lenders, exercise its setoff rights hereunder against any accounts of the Borrower now or hereafter maintained with such Lender. 15.6 Ratable Sharing. The Lenders agree among themselves that (i) with respect to all amounts received by them which are applicable to the payment of the Obligations (excluding the fees described in Sections 5.2(f) and 5.3 and Article XIII) equitable adjustment will be made so that, in effect, all such amounts will be shared among them ratably in accordance with their Pro Rata Shares, whether received by voluntary payment, by the exercise of the right of setoff or banker's lien, by counterclaim or crossaction or by the enforcement of any or all of the Obligations (excluding the amounts described in Sections 5.2(f) and 5.3 and Article XIII), (ii) if any of them shall by voluntary payment or by the exercise of any right of counterclaim, setoff, banker's lien or otherwise, receive payment of a proportion of the aggregate amount of the Obligations held by it, which is greater than the amount which such Lender is entitled to receive hereunder, the Lender receiving such excess payment shall purchase, without recourse or warranty, an undivided interest and participation (which it shall be deemed to have done simultaneously upon the receipt of such payment) in such Obligations owed to the others so that all such recoveries with respect to such Obligations shall be applied ratably in accordance with their Pro Rata Shares; provided, however, that if all or part of such excess payment received by the purchasing party is thereafter recovered from it, those purchases shall be rescinded and the purchase prices paid for such participations shall be returned to such party to the extent necessary to adjust for such recovery, but without interest except to the extent the purchasing party is required to pay interest in connection with such recovery. The Borrower agrees that any Lender so purchasing a participation from another Lender pursuant to this Section 15.6 may, to the fullest extent permitted by law, exercise all its rights of payment (including, subject to Section 88 15.5, the right of setoff) with respect to such participation as fully as if such Lender were the direct creditor of the Borrower in the amount of such participation. 89 15.7 Amendments and Waivers. (a) General Provisions. Unless otherwise provided for or required in this Agreement, no amendment or modification of any provision of this Agreement or any of the other Loan Documents shall be effective without the written agreement of the Requisite Lenders (which the Requisite Lenders shall have the right to grant or withhold in their sole discretion) and the Borrower; provided, however, that the Borrower's agreement shall not be required for any amendment or modification of Article XII (other than any portions thereof on which the Borrower is entitled to rely or which the Borrower is entitled to enforce). No termination or waiver of any provision of this Agreement or any of the other Loan Documents, or consent to any departure by the Borrower therefrom, other than those specifically reserved to the Administrative Agent or the other Lenders, shall be effective without the written concurrence of the Requisite Lenders, which the Requisite Lenders shall have the right to grant or withhold in their sole discretion. All amendments, waivers and consents not specifically reserved to the Administrative Agent or the other Lenders in Section 15.7(b), 15.7(c), and in other provisions of this Agreement shall require only the approval of the Requisite Lenders. Any waiver or consent shall be effective only in the specific instance and for the specific purpose for which it was given. No notice to or demand on the Borrower in any case shall entitle the Borrower to any other or further notice or demand in similar or other circumstances. (b) Amendments. Consents and Waivers by Affected Lenders. Any amendment, modification, termination, waiver or consent with respect to any of the following provisions of this Agreement shall be effective only by a written agreement, signed by each Lender affected thereby as described below: (i) waiver of any of the conditions specified in Sections 6.1 and 6.2 (except with respect to a condition based upon another provision of this Agreement, the waiver of which requires the concurrence of only the Requisite Lenders), (ii) increase in the amount of such Lender's Revolving Credit Commitment, (iii) reduction of the principal of, rate or amount of interest on the Loans or any fees or other amounts payable to such Lender (other than by the payment or prepayment thereof), and (iv) postponement or extension of any date (other than the Revolving Credit Termination Date postponement or extension of which is governed by Section 15.7(c)(i)) fixed for any payment of principal of, or interest on, the Loans or any fees or other amounts payable to such Lender (except with respect to any modifications of the applicable provisions relating to prepayments of Loans and other Obligations which are governed by Section 4.2(b)). (c) Amendments, Consents and Waivers by All Lenders. Any amendment, modification, termination, waiver or consent with respect to any of the following provisions of this Agreement shall be effective only by a written agreement, signed by each Lender: 90 (i) postponement or extension of the Revolving Credit Termination Date, (ii) increase in the Maximum Aggregate Commitment Amount to any amount in excess of $250,000,000, (iii) change in the definition of Requisite Lenders or in the aggregate Pro Rata Share of the Lenders which shall be required for the Lenders or any of them to take action hereunder or under the other Loan Documents, (iv) amendment of Section 15.6 or this Section 15.7, (v) assignment of any right or interest in or under this Agreement or any of the other Loan Documents by the Borrower, (vi) any modification to or amendment of the Guaranty or any release of GGP, Inc., as the guarantor thereunder, prior to the satisfaction in full of the Obligations, (vii) any modification to or amendment of Section 10.12 hereof, and (viii) waiver of any Event of Default described in Section 11.1(a). (d) Agent Authority. The Administrative Agent may, but shall have no obligation to, with the written concurrence of any Lender, execute amendments, modifications, waivers or consents on behalf of that Lender. Notwithstanding anything to the contrary contained in this Section 15.7, no amendment, modification, waiver or consent shall affect the rights or duties of the Administrative Agent as Administrative Agent under this Agreement and the other Loan Documents, unless made in writing and signed by the Administrative Agent in addition to the Lenders required above to take such action. Notwithstanding anything herein to the contrary, in the event that the Borrower shall have requested, in writing, that any Lender agree to an amendment, modification, waiver or consent with respect to any particular provision or provisions of this Agreement or the other Loan Documents, and such Lender shall have failed to state, in writing, that it either agrees or disagrees (in full or in part) with all such requests (in the case of its statement of agreement, subject to satisfactory documentation and such other reasonable conditions it may specify) within thirty (30) days after such request, then such Lender hereby irrevocably authorizes the Administrative Agent to agree or disagree, in full or in part, and in the Administrative Agent's sole discretion, to such requests on behalf of such Lender as such Lender's attorney-in-fact and to execute and deliver any writing approved by the Administrative Agent which evidences such agreement as such Lender's duly authorized agent for such purposes. 15.8 Notices. Unless otherwise specifically provided herein, any notice or other communication herein required or permitted to be given shall be in writing and may be personally served, sent by facsimile transmission or by courier service or United States certified mail and shall be deemed to have been given when delivered in person or by courier service, upon receipt of a facsimile transmission, or four (4) Business Days after deposit in the United States mail with postage prepaid and properly addressed. Notices to the Administrative Agent 91 pursuant to Articles II, IV or XII shall not be effective until received by the Administrative Agent. For the purposes hereof, the addresses of the parties hereto (until notice of a change thereof is delivered as provided in this Section 15.8) shall be as set forth below each party's name on the signature pages hereof or the signature page of any applicable Assignment and Acceptance, Joinder Agreement or Addendum, or, as to each party, at such other address as may be designated by such party in a written notice to all of the other parties to this Agreement. 15.9 Survival of Warranties and Agreements. All representations and warranties made herein and all obligations of the Borrower in respect of taxes, indemnification and expense reimbursement shall survive the execution and delivery of this Agreement and the other Loan Documents, the making and repayment of the Loans and the termination of this Agreement and, except as otherwise expressly provided in Section 6.2(a) hereof, shall not be limited in any way by the passage of time or occurrence of any event and shall expressly cover time periods when the Administrative Agent or any of the other Lenders may have come into possession or control of any Property of the Borrower or any of its Subsidiaries. Notwithstanding the foregoing, however, such representations, warranties and obligations shall terminate and be of no further force and effect two years after payment in full of the Loans. 15.10 Failure or Indulgence Not Waiver; Remedies Cumulative. Subject to the terms of Section 15.7(d) of this Agreement, no failure or delay on the part of the Administrative Agent or any other Lender in the exercise of any power, right or privilege under any of the Loan Documents shall impair such power, right or privilege or be construed to be a waiver of any default or acquiescence therein, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege. All rights and remedies existing under the Loan Documents are cumulative to and not exclusive of any rights or remedies otherwise available. 15.11 Marshalling: Payments Set Aside. Neither the Administrative Agent nor any other Lender shall be under any obligation to marshal any assets in favor of the Borrower or any other party or against or in payment of any or all of the Obligations. To the extent that the Borrower makes a payment or payments to the Administrative Agent or any other Lender or any such Person exercises its rights of setoff, and such payment or payments or the proceeds of such enforcement or setoff or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside or required to be repaid to a trustee, receiver or any other party, then to the extent of such recovery, the obligation or part thereof originally intended to be satisfied, and all right and remedies therefor, shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred. 15.12 Severability. In case any provision in or obligation under this Agreement or the other Loan Documents shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby. 15.13 Headings. Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement or be given any substantive effect. 92 15.14 Governing Law. THIS AGREEMENT SHALL BE INTERPRETED, AND THE RIGHTS AND LIABILITIES OF THE PARTIES HERETO DETERMINED, IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF ILLINOIS WITHOUT REGARD TO ITS CONFLICT OF LAWS PRINCIPLES. 15.15 Limitation of Liability. No claim may be made by any Lender, any of the Co-Arrangers or any other Person against any Lender (acting in any capacity hereunder) or the Affiliates, directors, officers, employees, attorneys or agents of any of them for any consequential or punitive damages in respect of any claim for breach of contract or any other theory of liability arising out of or related to the transactions contemplated by this Agreement, or any act, omission or event occurring in connection therewith; and each Lender and the Administrative Agent hereby waives, releases and agrees not to sue upon any such claim for any such damages, whether or not accrued and whether or not known or suspected to exist in its favor. In addition, no claim may be made by any Lender, the Administrative Agent or any other Person against any directors, officers or trustees of the Borrower. 15.16 Successors and Assigns. This Agreement and the other Loan Documents shall be binding upon the parties hereto and their respective successors and assigns and shall inure to the benefit of the parties hereto and their successors and permitted assigns. 15.17 Certain Consents and Waivers. (a) Personal Jurisdiction. (i) EACH OF THE LENDERS AND THE BORROWER IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF ANY ILLINOIS STATE COURT OR FEDERAL COURT SITTING IN CHICAGO, ILLINOIS AND ANY COURT HAVING JURISDICTION OVER APPEALS OF MATTERS HEARD IN SUCH COURTS, IN ANY ACTION OR PROCEEDING ARISING OUT OF, CONNECTED WITH, RELATED TO OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS AGREEMENT, WHETHER ARISING IN CONTRACT, TORT, EQUITY OR OTHERWISE, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH STATE COURT OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH FEDERAL COURT. THE BORROWER (IN SUCH CAPACITY, THE "PROCESS AGENT") AGREES TO ACCEPT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT, SUCH SERVICE BEING HEREBY ACKNOWLEDGED TO BE EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT. EACH OF THE LENDERS AND THE BORROWER AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. EACH OF THE LENDERS (AS TO COURTS IN ILLINOIS ONLY) AND THE BORROWER WAIVES IN 93 ALL DISPUTES ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT CONSIDERING THE DISPUTE. (ii) THE BORROWER AGREES THAT THE AGENT SHALL HAVE THE RIGHT TO PROCEED AGAINST THE BORROWER OR ITS PROPERTY IN A COURT IN ANY LOCATION NECESSARY OR APPROPRIATE TO ENABLE THE AGENT AND THE OTHER LENDERS TO ENFORCE A JUDGMENT OR OTHER COURT ORDER ENTERED IN FAVOR OF THE AGENT OR ANY OTHER LENDER IN ANY PROCEEDING DESCRIBED IN SUBSECTION (i) ABOVE. THE BORROWER AGREES THAT IT WILL NOT ASSERT ANY PERMISSIVE COUNTERCLAIMS IN ANY PROCEEDING BROUGHT BY THE AGENT OR ANY LENDER TO ENFORCE SUCH A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE AGENT OR ANY LENDER. THE BORROWER WAIVES ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT IN WHICH THE AGENT OR ANY LENDER MAY COMMENCE A PROCEEDING DESCRIBED IN THIS SUBSECTION (ii). (b) Service of Process. EACH OF THE LENDERS (WITH RESPECT TO ILLINOIS ONLY) AND THE BORROWER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE PROCESS AGENT (FOR BORROWER) OR THE BORROWER'S NOTICE ADDRESS SPECIFIED BELOW, SUCH SERVICE TO BECOME EFFECTIVE UPON RECEIPT. EACH OF THE LENDERS (WITH RESPECT TO ILLINOIS ONLY) AND THE BORROWER IRREVOCABLY WAIVES ANY OBJECTION (INCLUDING, WITHOUT LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY JURISDICTION SET FORTH ABOVE. NOTHING HEREIN SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF THE AGENT, THE OTHER LENDERS OR THE BORROWER TO BRING PROCEEDINGS AGAINST THE BORROWER IN THE COURTS OF ANY OTHER JURISDICTION. (c) Waiver of Jury Trial. EACH OF THE AGENT AND THE OTHER LENDERS AND THE BORROWER IRREVOCABLY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT. 15.18 Counterparts; Effectiveness; Inconsistencies. This Agreement and any amendments, waivers, consents, or supplements hereto may be executed in counterparts, each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument. This Agreement shall become effective against the Borrower and each Lender on the Closing Date. This Agreement and each of the other Loan Documents shall be construed to the extent reasonable to be consistent one with the other, but to the extent that the terms and conditions of this Agreement are actually inconsistent with 94 the terms and conditions of any other Loan Document, this Agreement shall govern. In the event the Lenders enter into any co-lender agreement with the Administrative Agent pertaining to the Lenders' respective rights with respect to voting on any matter referenced in this Agreement or the other Loan Documents on which the Lenders have a right to vote under the terms of this Agreement or the other Loan Documents, such co-lender agreement shall be construed to the extent reasonable to be consistent with this Agreement and the other Loan Documents, but to the extent that the terms and conditions of such co-lender agreement are actually inconsistent with the terms and conditions of this Agreement and/or the other Loan Documents, such co-lender agreement shall govern as among the Administrative Agent and the Lenders. Notwithstanding the foregoing, any rights reserved to the Administrative Agent under this Agreement and the other Loan Documents shall not be varied or in any way affected by such co-lender agreement and the rights and obligations of the Borrower under the Loan Documents will not be varied. 15.19 Limitation on Agreements. All agreements between the Borrower, the Administrative Agent and each Lender in the Loan Documents are hereby expressly limited so that in no event shall any of the Loans or other amounts payable by the Borrower under any of the Loan Documents be directly or indirectly secured (within the meaning of Regulation U) by Margin Stock. 15.20 Confidentiality. Subject to Section 15.1(g), the Lenders shall hold all nonpublic information obtained pursuant to the requirements of this Agreement, and identified as such by the Borrower, in accordance with such Lender's customary procedures for handling confidential information of this nature and in accordance with safe and sound banking practices (provided that such Lender may share such information with its Affiliates in accordance with such Lender's customary procedures for handling confidential information of this nature and provided further that such Affiliate shall hold such information confidential) and in any event the Lenders may make disclosure reasonably required by a bona fide offeree, transferee or participant in connection with the contemplated transfer or participation or as required or requested by any Governmental Authority or representative thereof or pursuant to legal process and shall require any such offeree, transferee or participant to agree (and require any of its offerees, transferees or participants to agree) to comply with this Section 15.20. In no event shall any Lender be obligated or required to return any materials furnished by the Borrower; provided, however, each offeree shall be required to agree that if it does not become a transferee or participant it shall return all materials furnished to it by the Borrower or any Lender in connection with this Agreement. Any and all confidentiality agreements entered into between any Lender and the Borrower shall survive the execution of this Agreement. 15.21 Disclaimers. The Administrative Agent and the other Lenders shall not be liable to any contractor, subcontractor, supplier, laborer, architect, engineer, tenant or other party for services performed or materials supplied in connection with any work performed on the Real Properties, including any TI Work. The Administrative Agent and the other Lenders shall not be liable for any debts or claims accruing in favor of any such parties against the Borrower or others or against any of the Real Properties. The Borrower is not and shall not be an agent of any of the Administrative Agent or the other Lenders for any purposes and none of the Lenders nor the Administrative Agent shall be deemed partners or joint venturers with Borrower or any of its Affiliates as a result of the consummation of the transactions contemplated by this Agreement. 95 None of the Administrative Agent or the other Lenders shall be deemed to be in privity of contract with any contractor or provider of services to any Real Property, nor shall any payment of funds directly to a contractor or subcontractor or provider of services be deemed to create any third party beneficiary status or recognition of same by any of the Administrative Agent or the other Lenders and the Borrower agrees to hold the Administrative Agent and the other Lenders harmless from any of the damages and expenses resulting from such a construction of the relationship of the parties or any assertion thereof solely to the extent, if any, that the Borrower has requested that the Administrative Agent or any other Lender deal directly with or make any payments directly to such a contractor or provider of services. 15.22 No Third Party Beneficiaries. Nothing contained in this Agreement or any other Loan Document, whether express or implied, is intended to confer any rights or remedies under or by reason of this Agreement or such other Loan Documents on any Persons other than the parties hereto from time to time and, to the extent specifically provided herein, their respective officers, directors, shareholders, agents, attorneys, employees, Affiliates, successors and assigns (including, without limitation, the Indemnitees); nor is anything herein or therein intended to relieve or discharge the obligation or liability of any Persons other than those referred to above, or give any Persons other than those referred to above any right of subrogation or action over or against any party hereto. 15.23 Entire Agreement. This Agreement, taken together with all of the other Loan Documents, embodies the entire agreement and understanding among the parties hereto and supersedes all prior agreements and understandings, written and oral, relating to the subject matter hereof. 15.24 Borrower's Obligations. The Partnership and the Company shall be jointly and severally liable for all of the Obligations of the Borrower hereunder. [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK] 96 EXHIBIT A to Revolving Credit Agreement dated as of July 31, 2000 FORM OF ASSIGNMENT AND ACCEPTANCE ASSIGNMENT AND ACCEPTANCE This ASSIGNMENT AND ACCEPTANCE dated as of _______________________, _________, among [Names of Assignor Lenders] (each, an "Assignor" and collectively, the "Assignors") and ________________________, _______________________(etc.) (each, an "Assignee" and collectively, the "Assignees"). PRELIMINARY STATEMENTS Reference is made to the Revolving Credit Agreement dated as of July 31, 2000 (as the same may be amended, supplemented, restated or otherwise modified from time to time, the "Credit Agreement") among GGP Limited Partnership, GGPLP L.L.C., the institutions from time to time parties thereto as Lenders, and Bank of America, N.A., as Administrative Agent. Capitalized terms used herein and not otherwise defined herein are used as defined in the Credit Agreement. The Assignors are Lenders under the Credit Agreement and each desires to sell and assign to the Assignees a portion of such Assignor's Loans, as set forth on Schedule 2 attached hereto (collectively, the "Assigned Loans") in the aggregate amount of $________ (the "Aggregate Assigned Amount"), and each Assignee desires to purchase and assume from each Assignor, on terms and conditions set forth below, an interest in such Assignor's respective Assigned Loans (the "Assigned Percentages"), together with the Assignors' respective rights and obligations under the Credit Agreement with respect to the Assigned Percentages, such that each Assignee shall, from and after the Effective Date (as defined below), become a Lender under the Credit Agreement with the respective Pro Rata Share listed on the signature pages attached hereto. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Assignors and the Assignees hereby agree as follows: In consideration of the payments by each Assignee to each Assignor, to be made by wire transfer to the Administrative Agent of immediately available funds on the Effective Date in accordance with Schedule 3 attached hereto, each Assignor hereby sells and assigns to each Assignee, and each Assignee hereby purchases and assumes from such Assignor, the Assigned Percentage set forth on Schedule 1 attached hereto, together with such Assignor's rights and obligations under the Credit Agreement and all of the other Loan Documents with respect to the Assigned Percentages as of the date hereof (after giving effect to any other assignments thereof made prior to the date hereof, whether or not such assignments have become effective, but without giving effect to any other assignments thereof also made on the date hereof). Each Assignor (i) represents and warrants that as of the date hereof its Loans are set forth on Schedule 2 attached hereto (in each case, after giving effect to any other assignments thereof made prior to the date hereof, whether or not such assignments have become effective, but without giving effect to any other assignments thereof made as of the date hereof); (ii) represents and warrants that it is the legal and beneficial owner of the interest being assigned by it hereunder and that such interest is free and clear of any adverse claim and that such Assignor is legally authorized to enter into this Assignment and Acceptance; (iii) makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with the Credit Agreement or any of the other Loan Documents or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Credit Agreement or any of the other Loan Documents or any other instrument or document furnished pursuant thereto and (iv) makes no representation or warranty and assumes no responsibility with respect to the financial condition of the Borrower or the performance or observance by the Borrower of any obligations under the Credit Agreement or any of the other Loan Documents or any other instrument or document furnished pursuant thereto. Each Assignee (i) represents and warrants that it is legally authorized to enter into this Assignment and Acceptance; (ii) confirms that it has received a copy of the Credit Agreement, together with copies of such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Acceptance; (iii) agrees that it shall have no recourse against the Assignor with respect to any matter relating to the Credit Agreement, any of the other Loan Documents, or this Assignment and Acceptance (except with respect to the representations or warranties made by the Assignors in clauses (i) and (ii) of paragraph 2 above); (iv) agrees that it will, independently and without reliance upon the Administrative Agent, the Assignors or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement; (v) confirms that it is an Eligible Assignee; (vi) appoints and authorizes the Administrative Agent to take such action as agent on its behalf and to exercise such powers under the Credit Agreement as are delegated to the Administrative Agent by the terms thereof, together with such powers as are reasonably incidental thereto; (vii) agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Credit Agreement are required to be performed by it as a Lender; (viii) confirms that, to the best of its knowledge, as of the date hereof, it is not subject to any law, regulation or guideline from any central bank or other Governmental Authority or quasi-governmental authority exercising jurisdiction, power or control over it, which would subject the Borrower to the payment of additional compensation under Section 13.2 or under Section 13.3 of the Credit Agreement; (ix) specifies as its Domestic Lending Office (and address for notices) and Eurodollar Lending Office(s) the offices set forth beneath its name on the signature pages hereof; (x) if such Assignee is organized under the laws of a jurisdiction outside the United States, attaches the forms prescribed by the Internal Revenue Service of the United States certifying as to the Assignee's status for purposes of determining exemption from United States withholding taxes with respect to all payments to be made to the Assignee under the Credit Agreement and the Notes or such other documents as are necessary to indicate that all such payments are subject to such taxes at a rate reduced by an applicable tax treaty; and (xi) represents and warrants that none of the funds, monies, assets or other consideration being used to purchase pursuant to this Assignment and Acceptance are "plan assets" as defined under ERISA and that its rights, benefits, and interests in and under the Loan Documents will not be "plan assets" under ERISA. Following the execution of this Assignment and Acceptance by each of the Assignors and the Assignees, it will be delivered to the Administrative Agent for acceptance and recording by the Administrative Agent. The effective date of this Assignment and Acceptance shall be _______________________ (the "Effective Date"). As of the Effective Date, (i) each Assignee shall be a party to the Credit Agreement and, to the extent provided in this Assignment and Acceptance, have the rights and obligations of a Lender thereunder and (ii) each Assignor shall, to the extent provided in this Assignment and Acceptance, relinquish its rights and be released from its obligations subsequently arising under the Credit Agreement with respect to its Assigned Loans. From and after the Effective Date, the Administrative Agent shall make all payments under the Credit Agreement and the Notes in respect of the Aggregate Assigned Amount (including, without limitation, all payments of principal, interest and fees with respect thereto) to the appropriate Assignees. The Administrative Agent shall make all appropriate adjustments in payments under the Credit Agreement and the Notes for periods prior to the Effective Date. THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS. This Assignment and Acceptance may be executed in one or more counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument. IN WITNESS WHEREOF, the parties hereto have caused this Assignment and Acceptance to be executed by their respective officers thereunto duly authorized, as of the date first above written. ASSIGNORS: __________________________________ By:_______________________________ Name:_____________________________ Title:____________________________ By:_______________________________ Name:_____________________________ Title:____________________________ Notice Address, Domestic Lending Office and Eurodollar Lending Office: Adjusted Pro Rata Share: _______ % Adjusted Loans: $____________ ASSIGNEES: __________________________________ By:_______________________________ Name:_____________________________ Title:____________________________ By:_______________________________ Name:_____________________________ Title:____________________________ Pro Rata Share: % Accepted as of this ______ day of _________________________, _____ BANK OF AMERICA, N.A., as Administrative Agent By:____________________________ Name:__________________________ Title:_________________________ SCHEDULE 1 to Exhibit A Assigned New Pro Assignee Percentage Rata Share -------- ---------- ---------- SCHEDULE 2 to Exhibit A EXISTING LOANS AND PRO RATA SHARES OF ASSIGNORS Existing Assigned Assignor Existing Loans Pro Rata Share Loans -------- -------------- -------------- ----- SCHEDULE 3 to Exhibit A PAYMENTS* Funding Amount Repayment to Lender Facility Fee Assignors Agent** ------ ------------ --------- ------- __________________ * Payments to the Lenders are shown without parentheses; payments from the Lenders to the Agent, on its own behalf or on behalf of the Lenders, are shown in parentheses. ** Pursuant to Section 15.1(d) of the Credit Agreement. EXHIBIT B to Revolving Credit Agreement dated as of January 31, 2000 FORM OF PROMISSORY NOTE PROMISSORY NOTE Dated: January 31, 2000 FOR VALUE RECEIVED, the undersigned, GGP LIMITED PARTNERSHIP, a Delaware limited partnership, and GGPLP L.L.C., a Delaware limited liability company (the "Borrower"), jointly and severally, HEREBY PROMISE TO PAY to the order of ____________________ (the "Lender") on the Maturity Date, the aggregate principal amount then outstanding of the Loans made by the Lender to the Borrower pursuant to that certain Revolving Credit Agreement dated as of July 31, 2000, among the Borrower, the Lender, and the other financial institutions from time to time parties thereto as Lenders and Bank of America, N.A., as Administrative Agent (as the same may be amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement"). Capitalized terms used herein, and not otherwise defined herein, shall have the meanings ascribed to such terms in the Credit Agreement. The Borrower further promises to pay interest on the unpaid principal amount of each Loan from the date advanced until such principal amount is paid in full, at such interest rates (which shall not exceed the maximum rate permitted by Illinois law), and at such times, as are specified in the Credit Agreement. All payments of principal and interest in respect of this Promissory Note shall be made to the Administrative Agent in lawful money of the United States of America in same day funds for the account of the Lender in accordance with the terms of the Credit Agreement. Each Loan made by the Lender to the Borrower pursuant to the Credit Agreement, and all payments made on account of principal thereof, shall be recorded by the Lender on its books and records and, if the Lender so elects in connection with any transfer or enforcement hereof, appropriate notations to evidence the foregoing information with respect to each such Loan then outstanding may be endorsed by the Lender on a schedule to be attached hereto by the Lender and thereby made a part hereof, or on a continuation of such schedule to be attached to and made a part hereof; provided that the failure of the Lender to make any such recordation or endorsement shall not affect the obligations of the Borrower hereunder or under the Credit Agreement. This Promissory Note is one of the Notes referred to in, is executed and delivered pursuant to, and is entitled to the benefits of, the Credit Agreement, to which Credit Agreement reference is hereby made for a statement of the terms and conditions under which this Promissory Note may be prepaid or the Obligations accelerated or extended. The terms and conditions of the Credit Agreement are hereby incorporated in their entirety herein by reference as though fully set forth herein. Upon the occurrence of certain Events of Default as more particularly described in the Credit Agreement, the unpaid principal amount evidenced by this Promissory Note shall become, and upon the occurrence and during the continuance of certain other Events of Default, such unpaid principal amount may be declared to be, due and payable in the manner, upon the conditions and with the effect provided in the Credit Agreement. Demand, presentment, diligence, protest and notice of nonpayment are hereby waived by the Borrower. THIS PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS. IN WITNESS WHEREOF, the Borrower has caused this Promissory Note to be executed and delivered by its duly authorized officer as of the day and year first above written. GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: ________________________________________ Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: ________________________________________ Name: Bernard Freibaum Title: Executive Vice President EXHIBIT C-1 to Revolving Credit Agreement dated as of January 31, 2000 NOTICE OF BORROWING - BASE RATE LOANS Bank of America, N.A. 231 South LaSalle Street 12/th/ Floor Chicago, Illinois 60697 Attention: Ronald P. Phemister Zelinda Patarini Telephone: (312) 828-5175 Facsimile: (312) 974-4970 Ladies and Gentlemen: Reference is hereby made to that certain Revolving Credit Agreement dated as of July 31, 2000 (as the same may be amended, supplemented, restated or otherwise modified from time to time, the "Credit Agreement", the terms defined therein being used herein as therein defined), among GGP Limited Partnership, a Delaware limited partnership, and GGPLP L.L.C., a Delaware limited liability company (collectively, the "Borrower"), the institutions from time to time parties thereto as Lenders and Bank of America, N.A., as Administrative Agent. The Borrower hereby gives you notice, irrevocably, pursuant to Section 2.1(b) of the Credit Agreement that the Borrower hereby requests a Borrowing under the Credit Agreement and, in that connection, sets forth below the information relating to such Borrowing (the "Proposed Borrowing") as required pursuant to the terms of the Credit Agreement: The Funding Date (which shall be a Business Day) of the Proposed Borrowing is _____________, ____. The amount of the Proposed Borrowing is $___________. The Proposed Borrowing will be of Base Rate Loans. The Borrower hereby directs the Administrative Agent to disburse the proceeds of the Loans comprising the Proposed Borrowing on the Funding Date as set forth on Schedule 1 attached hereto and made a part hereof, whereupon the proceeds of such Loans shall be deemed received by or for the benefit of the Borrower. The Borrower hereby certifies that the conditions precedent contained in Section 6.1 or 6.2, as applicable, are satisfied on the date hereof and will be satisfied on the Funding Date of the Proposed Borrowing. [Signatures on next page] GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: ___________________________ Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: ______________________________ Name: Bernard Freibaum Title: Executive Vice President SCHEDULE 1 ---------- to Notice of Borrowing dated as of ____________, 2000 Bank: ABA No.: Account Name: Account No.: Special Instructions: EXHIBIT C-2 ----------- to Revolving Credit Agreement dated as of January 31, 2000 NOTICE OF BORROWING - EURODOLLAR RATE LOANS ------------------------------------------- Bank of America, N.A. 231 South LaSalle Street 12/th/ Floor Chicago, Illinois 60697 Attention: Ronald P. Phemister Zelinda Patarini Telephone: (312) 828-5175 Facsimile: (312) 974-4970 Ladies and Gentlemen: Reference is hereby made to that certain Revolving Credit Agreement dated as of July 31, 2000 (as the same may be amended, supplemented, restated or otherwise modified from time to time, the "Credit Agreement", the terms defined therein being used herein as therein defined), among GGP Limited Partnership, a Delaware limited partnership, and GGPLP L.L.C., a Delaware limited liability company (collectively, the "Borrower"), the institutions from time to time parties thereto as Lenders and Bank of America, N.A., as Administrative Agent. The Borrower hereby gives you notice, irrevocably, pursuant to Section 2.1(b) of the Credit Agreement that the Borrower hereby requests a Borrowing under the Credit Agreement and, in that connection, sets forth below the information relating to such Borrowing (the "Proposed Borrowing") as required pursuant to the terms of the Credit Agreement: The Funding Date (which shall be a Business Day) of the Proposed Borrowing is ___________, _____. The amount of the Proposed Borrowing is $_____________________. The Proposed Borrowing will be of Eurodollar Rate Loans. The requested Eurodollar Interest Period for the Proposed Borrowing is from _________ and ending __________ (for a total of _______ months). The Borrower hereby directs the Administrative Agent to disburse the proceeds of the Loans comprising the Proposed Borrowing on the Funding Date as set forth on Schedule 1 attached hereto and made a part hereof, whereupon the proceeds of such Loans shall be deemed received by or for the benefit of the Borrower. The Borrower hereby certifies that the conditions precedent contained in Section 6.1 or 6.2, as applicable, are satisfied on the date hereof and will be satisfied on the Funding Date of the Proposed Borrowing. GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: __________________________ Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: ______________________________ Name: Bernard Freibaum Title: Executive Vice President SCHEDULE 1 ---------- to Notice of Borrowing dated as of ____________, 2000 Bank: ABA No.: Account Name: Account No.: Special Instructions: EXHIBIT D --------- to Credit Agreement dated as of January 31, 2000 FORM OF NOTICE OF CONVERSION/CONTINUATION ----------------------------------------- Bank of America, N.A. 231 South LaSalle Street 12/th/ Floor Chicago, Illinois 60697 Attention: Ronald P. Phemister Zelinda Patarini Telephone: (312) 828-5175 Facsimile: (312) 974-4970 Ladies and Gentlemen: Reference is hereby made to that certain Revolving Credit Agreement dated as of July 31, 2000 (as the same may be amended, supplemented, restated or otherwise modified from time to time, the "Credit Agreement", the terms defined therein being used herein as therein defined), among GGP Limited Partnership, a Delaware limited partnership, and GGPLP L.L.C., a Delaware limited liability company (collectively, the "Borrower"), the institutions from time to time parties thereto as Lenders and Bank of America, N.A., as Administrative Agent. The Borrower hereby gives you notice pursuant to Section 5.1(c)(ii) of the Credit Agreement that the Borrower hereby elects to/1/: 1. Convert $__________/2/ in aggregate principal amount of Base Rate Loans from Base Rate Loans to Eurodollar Rate Loans on __________________, _______/3/. The Eurodollar Interest Period for such Eurodollar Rate Loans is requested to be month(s). 2. Convert $____________ in aggregate principal amount of Eurodollar Rate Loans with a current Eurodollar Interest Period ending ________________, _________/4/ to Base Rate Loans. /1/ Include those items that are applicable, completed appropriately for the circumstances. /2/ Such amount of conversion to or continuation of Eurodollar Rate Loans must be in a minimum amount of $2,000,000 and in integral multiples of $1,000,000 in excess of that amount. /3/ Date of conversion must be a Business Day. /4/ The Conversion of Eurodollar Rate Loans shall be made on, and only on, the last day of the Eurodollar Interest Period for such Eurodollar Rate Loans. 3. Continue as Eurodollar Rate Loans $__________/5/ in aggregate principal amount of Eurodollar Rate Loans with a current Eurodollar Interest Period ending __________________, ______. The succeeding Eurodollar Interest Period for such Eurodollar Rate Loans is requested to be _______ month(s). The Borrower hereby certifies that on the date hereof there are no prohibitions under the Credit Agreement to the requested conversion/continuation, and no such prohibitions will exist on the date of the requested conversion/continuation. GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: __________________________ Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: ______________________________ Name: Bernard Freibaum Title: Executive Vice President ______________________ /5/ Such amount of conversion to or continuation of Eurodollar Rate Loans must be in a minimum amount of $2,000,000 and in integral multiples of $1,000,000 in excess of that amount. EXHIBIT E --------- To Revolving Credit Agreement dated January 31, 2000 LIST OF CLOSING DOCUMENTS AND OTHER DELIVERIES ---------------------------------------------- - ------------------------------------------------------------- Document Description -------------------- - ------------------------------------------------------------- A. REVOLVING CREDIT AGREEMENT - CONDITIONS TO LOANS - ------------------------------------------------------------- 1. Signed Copies of the Credit Agreement - 6.1(a) - ------------------------------------------------------------- 2. Signed Copies of Promissory Notes - 6.1(a) - ------------------------------------------------------------- a. BOA - ------------------------------------------------------------- b. USB - ------------------------------------------------------------- c. Dresdner - ------------------------------------------------------------- 3. Signed Copies of the Guaranty - 6.1(a) - ------------------------------------------------------------- 4. Opinion of Counsel for the Borrower - 6.1(a) - ------------------------------------------------------------- 5. Borrower Sharing Agreement - 6.1(f) - ------------------------------------------------------------- 6. Pro Forma Covenant Calculations - 6.1(l) - ------------------------------------------------------------- 7. Set of Lehman Term Loan Documents - 6.1(j) - ------------------------------------------------------------- 8. Schedule of Sources and Uses of Funds - 6.1(j) - ------------------------------------------------------------- 9. Notice of Other Proposed Financing - 6.1(j) - ------------------------------------------------------------- b. EXHIBITS - ------------------------------------------------------------- 10. Exhibit A - Form of Assignment and Acceptance - ------------------------------------------------------------- 11. Exhibit B - Form of Promissory Note - ------------------------------------------------------------- 12. Exhibit C - Form of Notice of Borrowing - ------------------------------------------------------------- - ---------------------------------------------------------------------- Document Description -------------------- - ---------------------------------------------------------------------- 13. Exhibit D - Form of Notice of Conversion/ Continuation - ---------------------------------------------------------------------- 14. Exhibit E - List of Closing Documents - ---------------------------------------------------------------------- 15. Exhibit G - Calculations - ---------------------------------------------------------------------- C. SCHEDULES - ---------------------------------------------------------------------- 16. [Intentionally Omitted] - ---------------------------------------------------------------------- 17. Schedule 7.1-A - Copies of Organizational Documents Schedule 7.1-A-1 - Ownership Interests in GGPLP L.L.C. - ---------------------------------------------------------------------- 18. Schedule 7.1-C - Diagram of Structure of Borrower - ---------------------------------------------------------------------- 19. Schedule 7.1-C - Outstanding Warrants and Options - ---------------------------------------------------------------------- 20. Schedule 7.1-H - Indebtedness as of 6/30/00 - ---------------------------------------------------------------------- 21. Schedule 7.1-I - Litigation - ---------------------------------------------------------------------- 22. Schedule 7.1-P - Environmental Matters - ---------------------------------------------------------------------- 23. Schedule 7.1-Q - Benefit or Multiemployer Plan - ---------------------------------------------------------------------- 24. Schedule 7.1-T- Insurance policies and programs - ---------------------------------------------------------------------- 25. Schedule 10.12 - Existing Liens on Equity Interests - ---------------------------------------------------------------------- 26. Schedule 1 - Construction Asset Cost of Certain Land - ---------------------------------------------------------------------- D. MISCELLANEOUS - ---------------------------------------------------------------------- 27. Officer's Certificate Re: Authorized Employees - ---------------------------------------------------------------------- - ---------------------------------------------------------------------- - ---------------------------------------------------------------------- EXHIBIT F --------- [Intentionally Omitted] EXHIBIT G --------- to Credit Agreement dated as of January 31, 2000 SAMPLE CALCULATIONS OF FINANCIAL COVENANTS ------------------------------------------ (See Attached) EX-10.(CC) 16 dex10cc.txt 7/31/00 PROMISSORY NOTE IN FAVOR OF BOFA Exhibit 10(cc) PROMISSORY NOTE --------------- $50,000,000 Dated: July 31, 2000 FOR VALUE RECEIVED, the undersigned, GGP LIMITED PARTNERSHIP, a Delaware limited partnership, and GGPLP L.L.C., a Delaware limited liability company (collectively, the "Borrower"), jointly and severally, HEREBY PROMISE TO PAY to the order of BANK OF AMERICA, N.A. (the "Lender"), on the Maturity Date, the aggregate principal amount (or so much thereof as is then outstanding) of FIFTY MILLION AND NO/100 DOLLARS ($50,000,000), which is the total amount of the Loans made by the Lender to the Borrower pursuant to that certain Credit Agreement dated as of July 31, 2000, by and among the Borrower, the Lender, and the other financial institutions from time to time parties thereto as Lenders and Bank of America, N.A., as Administrative Agent (as the same may be amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement"). Capitalized terms used herein, and not otherwise defined herein, shall have the meanings ascribed to such terms in the Credit Agreement. The Borrower further promises to pay interest on the unpaid principal amount of each Loan from the date advanced until such principal amount is paid in full, at such interest rates (which shall not exceed the maximum rate permitted by Illinois law), and at such times, as are specified in the Credit Agreement. All payments of principal and interest in respect of this Promissory Note shall be made to the Administrative Agent in lawful money of the United States of America in same day funds for the account of the Lender in accordance with the terms of the Credit Agreement. Each Loan made by the Lender to the Borrower pursuant to the Credit Agreement, and all payments made on account of principal thereof, shall be recorded by the Lender on its books and records and, if the Lender so elects in connection with any transfer or enforcement hereof, appropriate notations to evidence the foregoing information with respect to each such Loan then outstanding may be endorsed by the Lender on a schedule to be attached hereto by the Lender and thereby made a part hereof, or on a continuation of such schedule to be attached to and made a part hereof; provided that the failure of the Lender to make any such recordation or endorsement shall not affect the obligations of the Borrower hereunder or under the Credit Agreement. This Promissory Note is one of the Notes referred to in, is executed and delivered pursuant to, and is entitled to the benefits of, the Credit Agreement, to which Credit Agreement reference is hereby made for a statement of the terms and conditions under which this Promissory Note may be prepaid or the Obligations accelerated or extended. The terms and conditions of the Credit Agreement are hereby incorporated in their entirety herein by reference as though fully set forth herein. Upon the occurrence of certain Events of Default as more particularly described in the Credit Agreement, the unpaid principal amount evidenced by this Promissory Note shall become, and upon the occurrence and during the continuance of certain other Events of Default, such unpaid principal amount may be declared to be, due and payable in the manner, upon the conditions and with the effect provided in the Credit Agreement. Demand, presentment, diligence, protest and notice of nonpayment are hereby waived by the Borrower. THIS PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS. IN WITNESS WHEREOF, the Borrower has caused this Promissory Note to be executed and delivered by its duly authorized officer as of the day and year first above written. GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: __________________________________________ Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: __________________________________________ Name: Bernard Freibaum Title: Executive Vice President -2- EX-10.(DD) 17 dex10dd.txt 7/31/00 PROMISSORY NOTE IN FAVOR OF DRESDNER Exhibit 10(dd) PROMISSORY NOTE --------------- $35,000,000 Dated: July 31, 2000 FOR VALUE RECEIVED, the undersigned, GGP LIMITED PARTNERSHIP, a Delaware limited partnership, and GGPLP L.L.C., a Delaware limited liability company (collectively, the "Borrower"), jointly and severally, HEREBY PROMISE TO PAY to the order of DRESDNER BANK, AG, New York and Grand Cayman Branches (the "Lender"), on the Maturity Date, the aggregate principal amount (or so much thereof as is then outstanding) of THIRTY-FIVE MILLION AND NO/100 DOLLARS ($35,000,000), which is the total amount of the Loans made by the Lender to the Borrower pursuant to that certain Credit Agreement dated as of July 31, 2000, by and among the Borrower, the Lender, and the other financial institutions from time to time parties thereto as Lenders and Bank of America, N.A., as Administrative Agent (as the same may be amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement"). Capitalized terms used herein, and not otherwise defined herein, shall have the meanings ascribed to such terms in the Credit Agreement. The Borrower further promises to pay interest on the unpaid principal amount of each Loan from the date advanced until such principal amount is paid in full, at such interest rates (which shall not exceed the maximum rate permitted by Illinois law), and at such times, as are specified in the Credit Agreement. All payments of principal and interest in respect of this Promissory Note shall be made to the Administrative Agent in lawful money of the United States of America in same day funds for the account of the Lender in accordance with the terms of the Credit Agreement. Each Loan made by the Lender to the Borrower pursuant to the Credit Agreement, and all payments made on account of principal thereof, shall be recorded by the Lender on its books and records and, if the Lender so elects in connection with any transfer or enforcement hereof, appropriate notations to evidence the foregoing information with respect to each such Loan then outstanding may be endorsed by the Lender on a schedule to be attached hereto by the Lender and thereby made a part hereof, or on a continuation of such schedule to be attached to and made a part hereof; provided that the failure of the Lender to make any such recordation or endorsement shall not affect the obligations of the Borrower hereunder or under the Credit Agreement. This Promissory Note is one of the Notes referred to in, is executed and delivered pursuant to, and is entitled to the benefits of, the Credit Agreement, to which Credit Agreement reference is hereby made for a statement of the terms and conditions under which this Promissory Note may be prepaid or the Obligations accelerated or extended. The terms and conditions of the Credit Agreement are hereby incorporated in their entirety herein by reference as though fully set forth herein. Upon the occurrence of certain Events of Default as more particularly described in the Credit Agreement, the unpaid principal amount evidenced by this Promissory Note shall become, and upon the occurrence and during the continuance of certain other Events of Default, such unpaid principal amount may be declared to be, due and payable in the manner, upon the conditions and with the effect provided in the Credit Agreement. Demand, presentment, diligence, protest and notice of nonpayment are hereby waived by the Borrower. THIS PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS. IN WITNESS WHEREOF, the Borrower has caused this Promissory Note to be executed and delivered by its duly authorized officer as of the day and year first above written. GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: ____________________________________________ Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: ____________________________________________ Name: Bernard Freibaum Title: Executive Vice President -2- EX-10.(EE) 18 dex10ee.txt 7/31/00 PROMISSORY NOTE IN FAVOR OF USB Exhibit 10(ee) PROMISSORY NOTE --------------- $50,000,000 Dated: July 31, 2000 FOR VALUE RECEIVED, the undersigned, GGP LIMITED PARTNERSHIP, a Delaware limited partnership, and GGPLP L.L.C., a Delaware limited liability company (collectively, the "Borrower"), jointly and severally, HEREBY PROMISE TO PAY to the order of U.S. BANK NATIONAL ASSOCIATION (the "Lender"), on the Maturity Date, the aggregate principal amount (or so much thereof as is then outstanding) of FIFTY MILLION AND NO/100 DOLLARS ($50,000,000), which is the total amount of the Loans made by the Lender to the Borrower pursuant to that certain Credit Agreement dated as of July 31, 2000, by and among the Borrower, the Lender, and the other financial institutions from time to time parties thereto as Lenders and Bank of America, N.A., as Administrative Agent (as the same may be amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement"). Capitalized terms used herein, and not otherwise defined herein, shall have the meanings ascribed to such terms in the Credit Agreement. The Borrower further promises to pay interest on the unpaid principal amount of each Loan from the date advanced until such principal amount is paid in full, at such interest rates (which shall not exceed the maximum rate permitted by Illinois law), and at such times, as are specified in the Credit Agreement. All payments of principal and interest in respect of this Promissory Note shall be made to the Administrative Agent in lawful money of the United States of America in same day funds for the account of the Lender in accordance with the terms of the Credit Agreement. Each Loan made by the Lender to the Borrower pursuant to the Credit Agreement, and all payments made on account of principal thereof, shall be recorded by the Lender on its books and records and, if the Lender so elects in connection with any transfer or enforcement hereof, appropriate notations to evidence the foregoing information with respect to each such Loan then outstanding may be endorsed by the Lender on a schedule to be attached hereto by the Lender and thereby made a part hereof, or on a continuation of such schedule to be attached to and made a part hereof; provided that the failure of the Lender to make any such recordation or endorsement shall not affect the obligations of the Borrower hereunder or under the Credit Agreement. This Promissory Note is one of the Notes referred to in, is executed and delivered pursuant to, and is entitled to the benefits of, the Credit Agreement, to which Credit Agreement reference is hereby made for a statement of the terms and conditions under which this Promissory Note may be prepaid or the Obligations accelerated or extended. The terms and conditions of the Credit Agreement are hereby incorporated in their entirety herein by reference as though fully set forth herein. Upon the occurrence of certain Events of Default as more particularly described in the Credit Agreement, the unpaid principal amount evidenced by this Promissory Note shall become, and upon the occurrence and during the continuance of certain other Events of Default, such unpaid principal amount may be declared to be, due and payable in the manner, upon the conditions and with the effect provided in the Credit Agreement. Demand, presentment, diligence, protest and notice of nonpayment are hereby waived by the Borrower. THIS PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS. IN WITNESS WHEREOF, the Borrower has caused this Promissory Note to be executed and delivered by its duly authorized officer as of the day and year first above written. GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: _____________________________________________ Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: _____________________________________________ Name: Bernard Freibaum Title: Executive Vice President -2- EX-10.(FF) 19 dex10ff.txt 9/1/00 JOINDER TO REVOLVING CREDIT AGREEMENT Exhibit 10(ff) JOINDER TO REVOLVING CREDIT AGREEMENT This JOINDER TO REVOLVING CREDIT AGREEMENT ("Joinder Agreement") is made and entered into as of this 1st day of September, 2000 by BAYERISCHE HYPO- UND VEREINSBANK, NEW YORK BRANCH (the "Joining Lender") for the benefit of the Borrower, the Co-Arrangers and the Lenders under that certain Revolving Credit Agreement dated as of July 31, 2000 (the "Credit Agreement") among GGP Limited Partnership, GGPLP L.L.C., Bank of America, N.A., U.S. Bank National Association, Dresdner Bank AG, New York and Grand Cayman Branches, and the institutions from time to time parties thereto as Lenders. Capitalized terms used and not otherwise defined in this Joinder Agreement shall have the respective meanings ascribed to them in the Credit Agreement. Pursuant to Section 3.2 of the Credit Agreement, the Joining Lender hereby joins in and becomes a party to the Credit Agreement and the other Loan Documents, and assumes all of the obligations of a Lender thereunder, all upon and subject to the terms and conditions set forth in the said Section 3.2, and with the effect as provided therein. In witness of the foregoing, the Joining Lender has executed and delivered this Joinder Agreement to the Borrower, the Co-Arrangers and the Lenders as of the day and year first set forth above. JOINING LENDER: BAYERISCHE HYPO- UND - -------------- VEREINSBANK, NEW YORK BRANCH By: ____________________________ Name: __________________________ Title: _________________________ Revolving Credit Commitment: $25,000,000 Notice Address, Domestic Lending -------------------------------- Office and Eurodollar Lending Office: ------------------------------------- Bayerische Hypo- und Vereinsbank 150 East 42/nd/ Street New York, NY 10017 Attention: Christine Elcik Telephone: (212) 672-5740 Facsimile: (212) 672-5527 CONSENT TO JOINDER AND ACKNOWLEDGEMENT Pursuant to and as required by Section 3.1 of the Credit Agreement, the Co-Arrangers and the Borrower hereby consent to the joinder of the Joining Lender pursuant to the foregoing Joinder Agreement, and to the increase in the Maximum Aggregate Commitment Amount resulting therefrom, which Maximum Aggregate Commitment Amount, after giving effect to the foregoing Joinder Agreement, is acknowledged to be $160,000,000. BORROWER: GGPLP L.L.C., a Delaware limited liability - -------- company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: ____________________________ Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: ________________________________ Name: Bernard Freibaum Title: Executive Vice President 2 SYNDICATION AGENT AND LENDER: U.S. BANK NATIONAL ASSOCIATION, - ---------------------------- a national banking association By: ___________________________________ Name: _________________________________ Title:_________________________________ ADMINISTRATIVE AGENT AND LENDER: BANK OF AMERICA, N.A., a national - ------------------------------- banking association By: ___________________________________ Name: _________________________________ Title: ________________________________ DOCUMENTATION AGENT and LENDER: DRESDNER BANK AG, NEW YORK AND - ------------------------------ GRAND CAYMAN BRANCHES By: ___________________________________ Name: _________________________________ Title: ________________________________ By: _________________________________ Name: _________________________________ Title: ________________________________ 3 EX-10.(GG) 20 dex10gg.txt 9/1/00 PROMISSORY NOTE IN FAVOR OF HYPO Exhibit 10(gg) PROMISSORY NOTE --------------- $25,000,000 Dated: September 1, 2000 FOR VALUE RECEIVED, the undersigned, GGP LIMITED PARTNERSHIP, a Delaware limited partnership, and GGPLP L.L.C., a Delaware limited liability company (collectively, the "Borrower"), jointly and severally, HEREBY PROMISE TO PAY to the order of BAYERISCHE Hypo- und Vereinsbank, NEW YORK BRANCH (the "Lender"), on the Maturity Date, the aggregate principal amount (or so much thereof as is then outstanding) of TWENTY-FIVE MILLION AND NO/100 DOLLARS ($25,000,000), which is the total amount of the Loans made by the Lender to the Borrower pursuant to that certain Credit Agreement dated as of July 31, 2000, by and among the Borrower, the Lender, and the other financial institutions from time to time parties thereto as Lenders and Bank of America, N.A., as Administrative Agent (as the same may be amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement"). Capitalized terms used herein, and not otherwise defined herein, shall have the meanings ascribed to such terms in the Credit Agreement. The Borrower further promises to pay interest on the unpaid principal amount of each Loan from the date advanced until such principal amount is paid in full, at such interest rates (which shall not exceed the maximum rate permitted by Illinois law), and at such times, as are specified in the Credit Agreement. All payments of principal and interest in respect of this Promissory Note shall be made to the Administrative Agent in lawful money of the United States of America in same day funds for the account of the Lender in accordance with the terms of the Credit Agreement. Each Loan made by the Lender to the Borrower pursuant to the Credit Agreement, and all payments made on account of principal thereof, shall be recorded by the Lender on its books and records and, if the Lender so elects in connection with any transfer or enforcement hereof, appropriate notations to evidence the foregoing information with respect to each such Loan then outstanding may be endorsed by the Lender on a schedule to be attached hereto by the Lender and thereby made a part hereof, or on a continuation of such schedule to be attached to and made a part hereof; provided that the failure of the Lender to make any such recordation or endorsement shall not affect the obligations of the Borrower hereunder or under the Credit Agreement. This Promissory Note is one of the Notes referred to in, is executed and delivered pursuant to, and is entitled to the benefits of, the Credit Agreement, to which Credit Agreement reference is hereby made for a statement of the terms and conditions under which this Promissory Note may be prepaid or the Obligations accelerated or extended. The terms and conditions of the Credit Agreement are hereby incorporated in their entirety herein by reference as though fully set forth herein. Upon the occurrence of certain Events of Default as more particularly described in the Credit Agreement, the unpaid principal amount evidenced by this Promissory Note shall become, and upon the occurrence and during the continuance of certain other Events of Default, such unpaid principal amount may be declared to be, due and payable in the manner, upon the conditions and with the effect provided in the Credit Agreement. Demand, presentment, diligence, protest and notice of nonpayment are hereby waived by the Borrower. THIS PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS. IN WITNESS WHEREOF, the Borrower has caused this Promissory Note to be executed and delivered by its duly authorized officer as of the day and year first above written. GGPLP L.L.C., a Delaware limited liability company By: GGP LIMITED PARTNERSHIP, a Delaware limited partnership, its sole managing member By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: ___________________________________________ Name: Bernard Freibaum Title: Executive Vice President GGP LIMITED PARTNERSHIP, a Delaware limited partnership By: GENERAL GROWTH PROPERTIES, INC., a Delaware corporation, its sole general partner By: ___________________________________________ Name: Bernard Freibaum Title: Executive Vice President -2- EX-21 21 dex21.txt LIST OF SUBSIDIARIES Exhibit 21 ---------- GENERAL GROWTH PROPERTIES, INC. LIST OF SUBSIDIARIES General Growth Properties, Inc. has a controlling interest in the following - --------------------------------------------------------------------------- entities: - --------
=================================================================================================== STATE OF ENTITY INCORPORATION/FORMATION - --------------------------------------------------------------------------------------------------- CENTURY PLAZA, INC. DELAWARE - --------------------------------------------------------------------------------------------------- COASTLAND CENTER, INC. DELAWARE - --------------------------------------------------------------------------------------------------- EAGLE RIDGE MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- EDEN PRAIRIE MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GENERAL GROWTH BAYBROOK MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GENERAL GROWTH - WESTLAKE (GP), INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP 110, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP ALA MOANA, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-LAKEVIEW SQUARE, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-LANSING MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-SOUTH SHORE PARTNERS, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GRANDVILLE MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- KALAMAZOO MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- KNOLLWOOD MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- MALL ST. VINCENT, INC. DELAWARE - --------------------------------------------------------------------------------------------------- MARKET PLACE OUTPARCEL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- MSAB HOLDINGS, INC. DELAWARE - --------------------------------------------------------------------------------------------------- OKLAHOMA MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- PIERRE BOSSIER MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- SPRING HILL MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- ST. CLOUD MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- TOWN EAST MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- TRACY MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- VALLEY HILLS MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------- GENERAL GROWTH FINANCE SPE, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP LIMITED PARTNERSHIP DELAWARE - --------------------------------------------------------------------------------------------------- ===================================================================================================
General Growth Finance SPE, Inc. has a controlling interest in the following - ---------------------------------------------------------------------------- entities: - --------
=================================================================================================== STATE OF ENTITY INCORPORATION/FORMATION - --------------------------------------------------------------------------------------------------- CHAMPAIGN MARKET PLACE, INC. DELAWARE - --------------------------------------------------------------------------------------------------- FALLBROOK SQUARE, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-WESTWOOD MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- SOUTHLAKE MALL, INC. DELAWARE ===================================================================================================
GGP Limited Partnership has a controlling interest in the following entities: - ----------------------------------------------------------------------------
=================================================================================================== STATE OF ENTITY INCORPORATION/FORMATION - --------------------------------------------------------------------------------------------------- DAYJAY ASSOCIATES (50% ownership) OKLAHOMA - --------------------------------------------------------------------------------------------------- GENERAL GROWTH - WESTLAKE, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-JORDAN CREEK L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- GG DR, L.L.C. ILLINOIS - --------------------------------------------------------------------------------------------------- GGP 110 HOLDING L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- GGP 110 L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- MALL ST. VINCENT, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- MSAB HOLDINGS L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- NORTHWEST OHIO MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- OKLAHOMA MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- ST. CLOUD MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- TOWN EAST MALL PARTNERSHIP TEXAS (50% ownership) - --------------------------------------------------------------------------------------------------- TOWN EAST MALL, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- WESTLAKE RETAIL ASSOCIATES, LTD. TEXAS (50% ownership) - --------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------- GGPLP L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- GGP HOLDING, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP IVANHOE, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP IVANHOE III, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GENERAL GROWTH MANAGEMENT, INC. DELAWARE ===================================================================================================
GGPLP L.L.C. has a controlling interest in the following entities: - -----------------------------------------------------------------
=================================================================================================== STATE OF ENTITY INCORPORATION/FORMATION - --------------------------------------------------------------------------------------------------- BAKERSFIELD MALL LLC DELAWARE - --------------------------------------------------------------------------------------------------- BAYBROOK MALL, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- BAY SHORE MALL I L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- BAY SHORE MALL PARTNERS CALIFORNIA - --------------------------------------------------------------------------------------------------- BAY SHORE MALL II L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- BELLIS FAIR PARTNERS WASHINGTON - --------------------------------------------------------------------------------------------------- BIRCHWOOD MALL PARTNERS L.L.C. MICHIGAN - --------------------------------------------------------------------------------------------------- BOSSIER OUTPARCEL, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- BOULEVARD MALL I LLC NEVADA - --------------------------------------------------------------------------------------------------- BOULEVARD MALL II LLC NEVADA - --------------------------------------------------------------------------------------------------- BOULEVARD ASSOCIATES NEVADA - --------------------------------------------------------------------------------------------------- CAPITAL MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- CENTURY PLAZA L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- CHAMPAIGN MARKET PLACE L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- CHAPEL HILLS MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- COASTLAND CENTER, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- COLONY SQUARE MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- COLUMBIA MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- EAGLE RIDGE MALL, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- EDEN PRAIRIE MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- FALLBROOK SQUARE PARTNERS LIMITED PARTNERSHIP CALIFORNIA - --------------------------------------------------------------------------------------------------- FALLBROOK SQUARE PARTNERS L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- FALLBROOK SQUARE PARTNERS II, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- FOX RIVER SHOPPING CENTER L.L.P. WISCONSIN - --------------------------------------------------------------------------------------------------- GATEWAY MALL PARTNERS SOUTH DAKOTA - --------------------------------------------------------------------------------------------------- GGP ALA MOANA HOLDINGS L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- GGP ALA MOANA L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-GRANDVILLE L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- GRAND TRAVERSE MALL PARTNERS IOWA - --------------------------------------------------------------------------------------------------- KALAMAZOO MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- KNOLLWOOD COMPANY, L.P. MINNESOTA - --------------------------------------------------------------------------------------------------- LAKEVIEW SQUARE LIMITED PARTNERSHIP DELAWARE - --------------------------------------------------------------------------------------------------- LANSING MALL LIMITED PARTNERSHIP DELAWARE - --------------------------------------------------------------------------------------------------- LOCKPORT L.L.C. NEW YORK - --------------------------------------------------------------------------------------------------- MALL OF THE BLUFFS PARTNERS L.L.C. IOWA - --------------------------------------------------------------------------------------------------- MARKET PLACE OUTPARCEL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- OAKWOOD HILLS MALL PARTNERS L.L.P. WISCONSIN - --------------------------------------------------------------------------------------------------- PARK MALL L.L.C. DELAWARE ===================================================================================================
=================================================================================================== STATE OF ENTITY INCORPORATION/FORMATION - --------------------------------------------------------------------------------------------------- PIEDMONT MALL PARTNERS ILLINOIS - --------------------------------------------------------------------------------------------------- PIERRE BOSSIER MALL, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- PINES MALL PARTNERS IOWA - --------------------------------------------------------------------------------------------------- RIO WEST L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- RIVER HILLS MALL L.L.P. MINNESOTA - --------------------------------------------------------------------------------------------------- RIVER FALLS MALL PARTNERS IOWA - --------------------------------------------------------------------------------------------------- ROCHESTER MALL LLC DELAWARE - --------------------------------------------------------------------------------------------------- SOONER FASHION MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- SOUTH SHORE PARTNERS, L.P. WASHINGTON - --------------------------------------------------------------------------------------------------- SOUTHLAKE MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- SOUTHWEST DENVER LAND L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- SOUTHWEST PLAZA L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- SPRING HILL MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- TRACY MALL PARTNERS I L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- TRACY MALL PARTNERS, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- TRACY MALL PARTNERS II, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- VALLEY HILLS MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- WESTWOOD LAND L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- WESTWOOD MALL LIMITED PARTNERSHIP DELAWARE ===================================================================================================
GGP Holding, Inc. has a controlling interest in the following entities: - ----------------------------------------------------------------------
=================================================================================================== STATE OF ENTITY INCORPORATION/FORMATION - --------------------------------------------------------------------------------------------------- BAKERSFIELD MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- BEXAR MCCRELESS CORP. DELAWARE - --------------------------------------------------------------------------------------------------- BOULEVARD MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- CALEDONIAN HOLDING COMPANY, INC. DELAWARE - --------------------------------------------------------------------------------------------------- DELTA INVESTMENTS LTD. NEVADA - --------------------------------------------------------------------------------------------------- GGP AMERICAN HOLDINGS INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP AMERICAN PROPERTIES INC. DELAWARE - --------------------------------------------------------------------------------------------------- HAWKEYE PROPERTIES, INC. NEVADA - --------------------------------------------------------------------------------------------------- JPT LIMITED NEVADA - --------------------------------------------------------------------------------------------------- LA PLACE SHOPPING CORP. DELAWARE - --------------------------------------------------------------------------------------------------- MJ, INC. NEVADA - --------------------------------------------------------------------------------------------------- MJF INVESTMENTS CORPORATION NEVADA - --------------------------------------------------------------------------------------------------- PACIFIC REALTY INC. NEVADA - --------------------------------------------------------------------------------------------------- PARIS PROPERTIES INC. NEVADA ===================================================================================================
=================================================================================================== STATE OF ENTITY INCORPORATION/FORMATION - --------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------- RASCAP REALTY, LTD. NEW YORK - --------------------------------------------------------------------------------------------------- RS PROPERTIES, INC. DELAWARE - --------------------------------------------------------------------------------------------------- STERLING FINANCIAL LTD. NEVADA - --------------------------------------------------------------------------------------------------- U.K. AMERICAN PROPERTIES, INC. DELAWARE - --------------------------------------------------------------------------------------------------- U.K.-LASALLE, INC. DELAWARE ===================================================================================================
GGP Ivanhoe, Inc. has a controlling interest in the following entities: - ----------------------------------------------------------------------
=================================================================================================== STATE OF ENTITY INCORPORATION/FORMATION - --------------------------------------------------------------------------------------------------- OAKS MALL GAINESVILLE LIMITED PARTNERSHIP DELAWARE - --------------------------------------------------------------------------------------------------- OAKS MALL GAINESVILLE II, INC. DELAWARE - --------------------------------------------------------------------------------------------------- WESTROADS MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- WESTROADS MALL II, INC. DELAWARE ===================================================================================================
GGP Ivanhoe III, Inc. has a controlling interest in the following entities: - --------------------------------------------------------------------------
=================================================================================================== STATE OF ENTITY INCORPORATION/FORMATION - --------------------------------------------------------------------------------------------------- CHATTANOOGA MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- EASTRIDGE SHOPPING CENTER, INC. DELAWARE - --------------------------------------------------------------------------------------------------- EASTRIDGE SHOPPING CENTER L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- GENERAL GROWTH OAK VIEW MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP SAVANNAH L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- GGP IVANHOE II, INC. DELAWARE - --------------------------------------------------------------------------------------------------- NORTHGATE MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- OAKVIEW MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- OGLETHORPE MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- OGLETHORPE MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- LANCASTER TRUST ILLINOIS - --------------------------------------------------------------------------------------------------- LANDMARK MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- LANDMARK MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- MAYFAIR PROPERTY INC. DELAWARE ===================================================================================================
=================================================================================================== STATE OF ENTITY INCORPORATION/FORMATION - --------------------------------------------------------------------------------------------------- PARCITY, INC. NEW YORK - --------------------------------------------------------------------------------------------------- PC LANCASTER, INC. DELAWARE - --------------------------------------------------------------------------------------------------- PARCIT-IIP LANCASTER VENTURE ILLINOIS ===================================================================================================
General Growth Management, Inc. has a controlling interest in the following - --------------------------------------------------------------------------- entities: - --------
=================================================================================================== STATE OF ENTITY INCORPORATION/FORMATION - --------------------------------------------------------------------------------------------------- GGMI MALLIBU, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGMI NATIONAL MALL NETWORK, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP CONTRACTOR, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP LH HOLDINGS L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- HOMART MANAGEMENT CO. DELAWARE - --------------------------------------------------------------------------------------------------- HOMART MANAGEMENT CO. - DELAWARE CONNECTICUT - --------------------------------------------------------------------------------------------------- HOMART MANAGEMENT CO. - FLORIDA DELAWARE - --------------------------------------------------------------------------------------------------- HOMART MANAGEMENT CO. - GEORGIA DELAWARE - --------------------------------------------------------------------------------------------------- HOMART MANAGEMENT CO. - HAWAII DELAWARE - --------------------------------------------------------------------------------------------------- HOMART MANAGEMENT CO. - ILLINOIS DELAWARE - --------------------------------------------------------------------------------------------------- HOMART MANAGEMENT CO. - MINNESOTA DELAWARE - --------------------------------------------------------------------------------------------------- HOMART MANAGEMENT CO. - DELAWARE PENNSYLVANIA - --------------------------------------------------------------------------------------------------- HOMART MANAGEMENT CO. - TEXAS TEXAS - --------------------------------------------------------------------------------------------------- HOMART MANAGEMENT CO. - WEST DELAWARE VIRGINIA - --------------------------------------------------------------------------------------------------- NATIONAL MALL NETWORK LLC DELAWARE ===================================================================================================
GGP Limited Partnership has a 50% interest in the following entities: - --------------------------------------------------------------------
=================================================================================================== STATE OF ENTITY INCORPORATION/FORMATION - --------------------------------------------------------------------------------------------------- GGP/HOMART, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP/HOMART II, L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- ===================================================================================================
GGP/Homart, Inc. has a controlling interest in the following entities: - ---------------------------------------------------------------------
=================================================================================================== STATE OF ENTITY INCORPORATION/FORMATION - --------------------------------------------------------------------------------------------------- ALAMEDA MALL ASSOCIATES ILLINOIS - --------------------------------------------------------------------------------------------------- ALAMEDA MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- BAY CITY MALL ASSOCIATES MICHIGAN - --------------------------------------------------------------------------------------------------- C.V. CENTER L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- EAST MESA ASSOCIATES (33 1/3% ownership) ARIZONA - --------------------------------------------------------------------------------------------------- EAST MESA LAND PARTNERSHIP ARIZONA (50% ownership) - --------------------------------------------------------------------------------------------------- GENERAL GROWTH WOODLANDS ONE, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GENERAL GROWTH WOODLANDS TWO, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-ARROWHEAD, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-BAY CITY ONE, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-BAY CITY TWO, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-BRASS MILL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-BUCKLAND HILLS ONE, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-BUCKLAND HILLS TWO, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-BUCKLAND HILLS THREE, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-CHANDLER, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-CHINO HILLS, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-CONCORD LAND CO., INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-DEERBROOK ONE, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-DEERBROOK TWO, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-DEERBROOK, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- GGP GENERAL I, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP GENERAL II, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP/H HOLDING, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-LAKELAND SQUARE, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-LAKELAND SQUARE II, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-MERIDEN SQUARE, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-MORENO VALLEY, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-NAUGATUCK VALLEY, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-NESHAMINY, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-NEWPARK, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-NEWPARK L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-NORTH POINT, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-PARKS AT ARLINGTON ONE, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-PARKS AT ARLINGTON TWO, INC. DELAWARE ===================================================================================================
=================================================================================================== STATE OF ENTITY INCORPORATION/FORMATION - --------------------------------------------------------------------------------------------------- GGP-PEMBROKE LAKES, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-PEMBROKE LAKES II, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-ROLLING OAKS, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-SHAVANO PARK, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-SPRING CREEK, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-STEEPLEGATE, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-SUPERSTITION SPRINGS, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-VISTA RIDGE, INC. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-VISTA RIDGE ASSOCIATES, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- GGP-WOODLANDS, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- H-D LAKELAND MALL JOINT VENTURE FLORIDA - --------------------------------------------------------------------------------------------------- HO RETAIL PROPERTIES I LIMITED ILLINOIS PARTNERSHIP - --------------------------------------------------------------------------------------------------- HO RETAIL PROPERTIES II LIMITED ILLINOIS PARTNERSHIP - --------------------------------------------------------------------------------------------------- NESHAMINY MALL JOINT VENTURE LIMITED ILLINOIS PARTNERSHIP (50% ownership) - --------------------------------------------------------------------------------------------------- NEWGATE MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- NEWPARK MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- NEW RIVER ASSOCIATES (33 1/3% ownership) ARIZONA - --------------------------------------------------------------------------------------------------- PARKS AT ARLINGTON, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- PAVILIONS AT BUCKLAND HILLS L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- PEMBROKE LAKES MALL LTD. FLORIDA - --------------------------------------------------------------------------------------------------- PRINCE KUHIO PLAZA, INC. DELAWARE - --------------------------------------------------------------------------------------------------- SIMON HOMART SHAVANO MALL TEXAS PARTNERSHIP (50% ownership) - --------------------------------------------------------------------------------------------------- SPECTRUM CENTER ASSOCIATES CALIFORNIA (50% ownership) - --------------------------------------------------------------------------------------------------- SPRING CREEK MALL ASSOCIATES COLORADO (50% ownership) - --------------------------------------------------------------------------------------------------- THE WOODLANDS MALL ASSOCIATES DELAWARE (50% ownership) - --------------------------------------------------------------------------------------------------- TYSONS GALLERIA L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- VISTA RIDGE ASSOCIATES, LTD. TEXAS - --------------------------------------------------------------------------------------------------- VISTA RIDGE JOINT VENTURE TEXAS - --------------------------------------------------------------------------------------------------- VISTA RIDGE MALL, INC. DELAWARE - --------------------------------------------------------------------------------------------------- WEST OAKS MALL TRUST DELAWARE ===================================================================================================
GGP/Homart II, L.L.C. has a controlling interest in the following entities: - --------------------------------------------------------------------------
=================================================================================================== STATE OF ENTITY INCORPORATION/FORMATION - --------------------------------------------------------------------------------------------------- ALDERWOOD MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- ALTAMONTE MALL VENTURE FLORIDA - --------------------------------------------------------------------------------------------------- ALTAMONTE SPRINGS MALL L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- ALTAMONTE SPRINGS MALL, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- ALTAMONTE SPRINGS MALL II, L.P. DELAWARE - --------------------------------------------------------------------------------------------------- CAROLINA PLACE L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- GENERAL GROWTH PROPERTIES-NATICK DELAWARE LIMITED PARTNERSHIP - --------------------------------------------------------------------------------------------------- GENERAL GROWTH PROPERTIES-NATICK II, DELAWARE INC. - --------------------------------------------------------------------------------------------------- GGP - NATICK TRUST MASSACHUSETTS - --------------------------------------------------------------------------------------------------- MONTCLAIR PLAZA L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- NORTHBROOK COURT L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- NORTHBROOK COURT I L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- NORTHBROOK COURT II L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- STONEBRIAR MALL LIMITED PARTNERSHIP DELAWARE - --------------------------------------------------------------------------------------------------- STONEBRIAR MALL (GP) L.L.C. DELAWARE - --------------------------------------------------------------------------------------------------- WESTCOAST ESTATES CALIFORNIA ===================================================================================================
EX-23 22 dex23.txt CONSENT OF INDEPENDENT ACCOUNTANTS Exhibit 23 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in the Registration Statements on Form S-3 (File Nos. 333-11067, 333-15907, 333-17021, 333-23035, 333-37247, 333-37383, 333-41603, 333-58045, 333-68505, 333-76379, 333-76757, 333-82569, 333-84419, 333-88813, 333-88819 and 333-91621) and the Registration Statements on Form S-8 (File Nos. 33-79372, 333-07241, 333-11237, 333-28449, 333-74461 and 333-79737) of General Growth Properties, Inc. of our report dated February 6, 2001 relating to the consolidated financial statements, which appears in the Annual Report on Form 10-K. We also consent to the incorporation by reference of our report dated February 6, 2001 relating to the financial statement schedule, which appears in this Form 10-K. Chicago, Illinois PricewaterhouseCoopers LLP March 14, 2001 -----END PRIVACY-ENHANCED MESSAGE-----