EXHIBIT 10.25
FIRST AMENDMENT TO AMENDED AND
RESTATED OPERATING AGREEMENT
First Amendment to Amended and Restated Operating Agreement, dated December
19, 2002 (the "Amendment"), among GGP Limited Partnership, a Delaware limited
partnership ("GGPLP"), Teachers' Retirement System of the State of Illinois
("TRS" and, together with GGPLP, the "Members"), and GGP-TRS L.L.C., a Delaware
limited liability company (the "Company").
RECITALS:
WHEREAS, the Members are all of the members of the Company;
WHEREAS, the Company and the Members have entered into that certain Amended
and Restated Operating Agreement dated August 26, 2002 (the "Existing Operating
Agreement"), relating to, among other things, the management of the Company and
the transfer of units of membership interest therein;
WHEREAS, GGPLP and The Western and Southern Life Insurance Company (the
"Florence Mall Seller") have entered into that certain Purchase and Sale
Agreement, dated as of November 27, 2002 (as the same may be amended from time
to time, the "Florence Mall Purchase Agreement"), pursuant to which GGPLP has
agreed to purchase Florence Mall in Florence, Kentucky ("Florence Mall");
WHEREAS, the Florence Mall Seller has made certain representations and
warranties in the Florence Mall Purchase Agreement (collectively, the "Florence
Mall Seller Representations");
WHEREAS, the Company is the sole member of Florence Mall L.L.C., a Delaware
limited liability company ("Florence Mall L.L.C.");
WHEREAS, pursuant to Section 6.3(d) of the Existing Operating Agreement,
GGPLP agreed to provide TRS with certain projections for the Company and its
properties for the TRS fiscal year commencing on July 1, 2003 (the "2003/2004
Projections") as well as projections for subsequent fiscal years;
WHEREAS, the parties hereto desire that (a) GGPLP contribute to the capital
of the Company all of the right, title and interest of GGPLP under the Florence
Mall Purchase Agreement, (b) the Company contribute to the capital of Florence
Mall L.L.C. all of such right, title and interest, (c) Florence Mall L.L.C.
obtain a loan upon the terms described on Schedule A, attached hereto and by
this reference made a part hereof (the "Florence Mall Loan"), the proceeds of
which will be used to pay a portion of the purchase price for Florence Mall (the
"Florence Mall Purchase Price"), (d) GGPLP and TRS make additional capital
contributions to the Company which will be used to pay the remainder of the
Florence Mall Purchase Price and the acquisition costs for Florence Mall, (e)
Florence Mall L.L.C. acquire Florence Mall pursuant to the Florence Mall
Purchase Agreement (the "Florence Mall Acquisition" and, together with
the Florence Mall Loan, the "Florence Mall Transactions") and (f) the parties
make certain other modifications to the Existing Operating Agreement; and
WHEREAS, the parties desire that the Company amend the Existing Operating
Agreement as hereinafter set forth to reflect their understandings regarding the
foregoing.
NOW, THEREFORE, for and in consideration of the mutual covenants and
agreements set forth herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties do hereby
agree as follows:
1. DEFINED TERMS. Capitalized terms used but not defined herein shall have
the meanings set forth in the Existing Operating Agreement, as amended hereby.
2. MATTERS RELATING TO ACQUISITION OF FLORENCE MALL.
(a) Prior to the closing of the Florence Mall Acquisition, (i) GGPLP shall
contribute to the capital of the Company all of GGPLP's right, title and
interest under the Florence Mall Purchase Agreement, and the Company shall
assume all of the obligations of GGPLP under the Florence Mall Purchase
Agreement, pursuant to an Assignment and Assumption Agreement substantially in
the form attached hereto as Exhibit A and (ii) the Company shall contribute to
the capital of Florence Mall L.L.C. all of such right, title and interest and
Florence Mall L.L.C. shall assume all of such obligations, pursuant to an
Assignment and Assumption Agreement substantially in the form attached hereto as
Exhibit B.
(b) The parties hereby approve the Florence Mall Transactions, which shall
be deemed to have been approved by the Board. The provisions of the last
sentence of Section 6.2 of the Existing Operating Agreement shall apply to the
loan documents relating to the Florence Mall Loan.
(c) Concurrently with the closing of the Florence Mall Acquisition, each
Member shall pay $20,500,000 to the Company as an additional capital
contribution thereto; provided, however, that GGPLP shall be entitled to a
credit against the amount of such payment for the $1,000,000 earnest money
deposit paid by it pursuant to the Florence Mall Purchase Agreement and any
interest accrued thereon, and GGPLP shall be deemed to have made a capital
contribution to the Company in the amount of such credit. The additional capital
contributions to be made pursuant to this paragraph shall be paid in immediately
available funds.
(d) No additional Units shall be issued to GGPLP or TRS on account of the
additional capital contributions referred to in this Section 2.
(e) The Company shall pay (and/or cause Florence Mall L.L.C. to pay) the
costs of the types described in Schedule 6.2 of the Existing Operating Agreement
incurred by the Company, Florence Mall L.L.C. and/or GGPLP in connection with
the consummation of the Florence Mall Transactions, including without limitation
the costs specified in Sections 3 and 4 of Schedule 7.1-2 of the Existing
Operating Agreement (collectively, the "Florence Mall Costs"), and the payment
of the Florence Mall Costs shall be deemed to have been approved by the Board.
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(f) Notwithstanding anything to the contrary contained in the Existing
Operating Agreement, the provisions of Section 6.2(e)(xvi) of the Existing
Operating Agreement shall not apply to the modifications described in Schedule
A.
(g) Notwithstanding anything to the contrary contained in the Existing
Operating Agreement, no portion of the Florence Mall Loan shall constitute
Retained Debt and no adjustment in the existing Retained Debt or the existing
allocation thereof shall occur on account of the incurrence of the Florence Mall
Loan.
(h) Notwithstanding anything to the contrary contained in the Existing
Operating Agreement, the Managing Member shall submit the portions of the 2003
Proposed Annual Business Plan and the 2003/2004 Projections that pertain to
Florence Mall on or before March 31, 2003 (instead of the earlier dates, if any,
specified in the Existing Operating Agreement) (but nothing contained herein
shall extend the due date for delivery of the remainder of the 2003 Proposed
Annual Business Plan, the remainder of the 2003/2004 Projections or any other
Proposed Annual Business Plan or projections). Notwithstanding anything to the
contrary contained herein, until there is an Annual Business Plan that pertains
to Florence Mall, the Company shall cause Florence Mall L.L.C. to operate
Florence Mall in a manner which is consistent with the operation by GGPLP of its
properties generally and Florence Mall L.L.C. may make such expenditures as are
consistent with the operation of Florence Mall in such manner without the
consent of the Board (but the making of capital expenditures during such period
in respect of Florence Mall shall require the approval of the Board unless they
are in connection with tenant leasing or constitute Nondiscretionary Items).
(i) GGPLP represents and warrants to TRS that, as of the date hereof and
except for matters set forth in written materials furnished to TRS or
Commonwealth Realty Advisors, Inc. prior to the execution and delivery hereof,
GGPLP has no Knowledge of inaccuracies in the Florence Mall Seller
Representations (without regard to the knowledge qualifications contained
therein) that individually or in the aggregate would have a material adverse
effect on Florence Mall. For purposes of this paragraph, "Knowledge" means the
actual knowledge (excluding any constructive or imputed knowledge) of Joel
Bayer. The representation and warranty contained in this Section 2(i) shall be
subject to the same limitations on survival as are contained in Section 5.3 of
the Florence Mall Purchase Agreement.
3. AMENDMENT TO SCHEDULE I. Schedule I of the Existing Operating Agreement
is hereby amended by deleting the reference to Piper Rudnick and its address and
inserting the following in lieu thereof:
"Gardner, Carton & Douglas
191 North Wacker Drive, Suite 3700
Chicago, Illinois 60606
Attn: Steven L. Loren
Telephone: 312/569-1337
Facsimile: 312/569-3337"
4. NO OTHER CHANGES; ETC. Except as specifically set forth herein, the
Existing Operating Agreement shall remain in full force and effect. Any
references in the Existing
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Operating Agreement to "hereunder" or "herein" or other terms of similar import
shall mean the Existing Operating Agreement, as amended hereby.
5. GOVERNING LAW. This Amendment shall be deemed to be a contract made
under the laws of the State of Delaware (without regard to its conflicts of law
principles).
6. COUNTERPARTS. This Amendment may be executed in counterparts, each of
which shall be an original and all of which together shall constitute the same
document.
7. BINDING EFFECT. This Amendment shall be binding upon, and inure to the
benefit of, the parties and their respective successors and assigns.
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IN WITNESS WHEREOF, the parties have executed this Amendment on the date
first written above.
GGP LIMITED PARTNERSHIP,
a Delaware limited partnership
By: General Growth Properties, Inc.,
a Delaware corporation, its general
partner
By: /s/ Joel Bayer
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Joel Bayer, Senior Vice President
TEACHERS' RETIREMENT SYSTEM OF THE STATE
OF ILLINOIS
By: Commonwealth Realty Advisors, Inc.,
as attorney-in-fact under power of
attorney
By: /s/ Mark Kirincich
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Mark Kirincich, President
GGP-TRS 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 general
partner
By: /s/ Joel Bayer
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Joel Bayer,
Senior Vice President