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EXHIBIT 4.12
REDEMPTION RIGHTS AGREEMENT (SERIES B PREFERRED UNITS)
Redemption Rights Agreement, dated July 10, 2002, among GGP
Limited
Partnership, a Delaware limited partnership (the "Partnership"),
General Growth
Properties, Inc., a Delaware corporation (the "General Partner"),
and the
parties who are designated as "Contributing Parties" on the
signature pages
hereof (the "Contributing Parties").
R E C I T A L S
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WHEREAS, the General Partner is the general partner of the
Partnership;
WHEREAS, pursuant to that certain Agreement and Plan of Merger
dated as
of March 3, 2002 (as the same has been amended and may be further
amended from
time to time, the "Merger Agreement"), among the Partnership, the
General
Partner and the other parties thereto, the Contributing Parties are
being
admitted as limited partners of the Partnership and the Partnership
is issuing
to them 8.5% Series B Cumulative Convertible Preferred Units of
limited
partnership in the Partnership (such units that are being issued
pursuant to the
Merger Agreement or any other securities issued in substitution
therefor (other
than Common Units, as defined below) pursuant to the Series B
Preferred Unit
Designation (as defined below), the "Series B Preferred Units");
and
WHEREAS, the parties desire to set forth herein the terms and
conditions upon which the Contributing Parties may cause the
Partnership to
redeem their Series B Preferred Units.
NOW, THEREFORE, the parties hereby agree as follows:
1. Definitions. For purposes of this Agreement, the following
terms
shall have the meanings set forth below:
"Acts" shall mean the Securities Act and the Exchange Act,
collectively.
"Affiliates" shall mean "affiliates" as defined pursuant to the
Securities Act and the regulations promulgated thereunder.
"Business Day" shall mean any day upon which commercial banks are
open
for business in Chicago, Illinois.
"Cash Purchase Price" shall mean, with respect to any redeemed
or
purchased Series B Preferred Units, an amount of cash equal to the
product of
(i) the $50 face amount per Series B Preferred Unit plus an amount
equal to all
distributions (whether or not earned or declared) accrued and
unpaid thereon to
the closing date multiplied by (ii) the number of such redeemed or
purchased
Series B Preferred Units.
"Certificate of Incorporation" shall mean the Certificate of
Incorporation of the General Partner, as the same may be amended
from time to
time.
"Claims" shall have the meaning set forth in Section 4.1(c).
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"Code" shall mean the Internal Revenue Code of 1986, as amended, or
any
successor code.
"Common Units" shall mean common units of limited partnership in
the
Partnership.
"Common Units Redemption Rights Agreement" shall mean that
certain
Redemption Rights Agreement (Common Units) dated the date hereof,
among the
parties hereto.
"Contributing Party Representative" shall mean Jay L. Bernstein, in
his
capacity as a member of Clifford Chance Rogers & Wells LLP, 200
Park Avenue, New
York, New York 10166, (212)878-8375 (facsimile), or such other
Person as the
holders of at least a majority of the issued and outstanding Series
B Preferred
Units may designate from time to time by delivery of written notice
to the
General Partner and the Partnership.
"Conversion Factor" shall mean .05, provided that such factor shall
be
adjusted in accordance with Section 6(a).
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as
amended, or any successor statute.
"Exchange Act Reporting Company" shall mean any corporation or
other
entity which is subject to the reporting requirements of the
Exchange Act.
"Expiration Date" shall mean the earlier of the fifteenth
anniversary
of the date hereof and the date upon which all Series B Preferred
Units have
been converted into Common Units or redeemed or purchased in
accordance with the
terms hereof.
"Liens" shall have the meaning set forth in the Merger
Agreement.
"Major Transaction Event" shall mean, with respect to the
General
Partner, (a) a reclassification, capital reorganization or other
similar change
regarding or affecting outstanding Shares (other than a change
addressed in
Section 6(a)); (b) a merger or consolidation of the General Partner
with one or
more other corporations or entities, other than a merger pursuant
to which the
General Partner is the surviving corporation and the outstanding
Shares are not
affected, (c) a sale, lease or exchange of all or substantially all
of the
General Partner's assets or (d) the liquidation, dissolution or
winding up of
the General Partner.
"Merger Agreement" shall have the meaning set forth in the
recitals.
"Notice" shall have the meaning set forth in Section 3.2.
"Partnership Agreement" shall mean that certain Second Amended
and
Restated Agreement of Limited Partnership of the Partnership, dated
as of April
1, 1998, as amended by that certain First Amendment thereto dated
as of June 10,
1998, that certain Second Amendment thereto dated as of June 29,
1998, that
certain Third Amendment thereto dated as of February 15, 2002, that
certain
Amendment dated as of April 24, 2002 and that certain Fourth
Amendment thereto
dated as July 10, 2002 and as the same may be further amended from
time to time.
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"Person" shall mean any natural person, corporation,
partnership,
association, limited liability company, trust or other entity.
"Prospectus" shall have the meaning set forth in Section
4.1(a).
"Preferred Stock" shall mean the 8.5% Cumulative Convertible
Preferred
Stock, Series C, $100 par value per share, of the General
Partner.
"Purchase Price" shall mean the Cash Purchase Price or the
Share
Purchase Price, or a combination thereof.
"Redemption Rights" shall have the meaning set forth in Section
2.
"Registration Statement" shall have the meaning set forth in
Section
4.1(a).
"REIT" shall mean real estate investment trust as such term is
defined
under the Code.
"REIT Requirements" shall have the meaning set forth in the
Partnership
Agreement, as the same may change from time to time.
"Rights" shall have the meaning set forth in Section 6(b).
"SEC" shall mean the
Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended,
or
any successor statute.
"Series B Preferred Units" shall have the meaning set forth in
the
recitals.
"Series B
Preferred Unit Designation" shall mean Schedule A to the
Fourth Amendment referred to in the definition of "Partnership
Agreement".
"Share Purchase Price" shall mean, with respect to the exercise of
any
Redemption Rights and subject to the provisions of Section 6(c), a
number of
Shares equal to the product of (a) the number of Series B Preferred
Units being
redeemed or purchased multiplied by (b) the Conversion Factor;
provided,
however, that, in the event the General Partner, after the date of
this
Agreement, issues to all holders of Shares rights, options,
warrants or
convertible or exchangeable securities entitling the stockholders
to subscribe
for or purchase Shares (other than Rights referred to in Section
6(b)) or any
other securities or property (other than distributions paid in
cash), then the
Share Purchase Price also shall include such rights, options,
warrants or
convertible or exchangeable securities or other securities or
property that a
holder of that number of Shares would have been entitled to receive
had such
holder held such Shares immediately prior to the time holders of
Shares became
entitled thereto.
"Shares" shall mean shares of the Preferred Stock.
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2. Grant
of Redemption Rights.
(a) Upon the terms and subject to the conditions contained herein,
the
Partnership does hereby grant to each Contributing Party, and such
Contributing
Party does hereby accept, the right, but without obligation on the
part of such
Contributing Party, to require the Partnership to redeem from time
to time part
or all of the Series B Preferred Units of such Contributing Party
for the Cash
Purchase Price with respect to such Series B Preferred Units
("Redemption
Rights").
(b) Notwithstanding the provisions of Section 2(a), the General
Partner
may, in its sole and absolute discretion, assume and satisfy the
obligation of
the Partnership with respect to any Contributing Party's exercise
of a
Redemption Right by paying to such Contributing Party, at the
General Partner's
election (which may be exercised in the General Partner's sole
discretion),
either the Cash Purchase Price or the Share Purchase Price (or a
combination
thereof) with respect to the Series B Preferred Units for which
such
Contributing Party exercised its Redemption Rights. If the General
Partner
assumes such obligations with respect to the exercise by any
Contributing Party
of a Redemption Right as to certain Series B Preferred Units and
makes the
required payment of the Share Purchase Price, the Cash Purchase
Price or any
combination thereof, then the Partnership shall have no obligation
to pay any
amount to such Contributing Party with respect to the exercise of a
Redemption
Right for such Series B Preferred Units, and any Series B Preferred
Units
purchased shall be owned by the General Partner for all
purposes.
(c) If the General Partner shall assume and satisfy the obligations
of
the Partnership with respect to the exercise of a Redemption Right
by any
Contributing Party, the Partnership, such Contributing Party and
the General
Partner each shall treat the transaction between the General
Partner and such
Contributing Party as a sale of such Contributing Party's Series B
Preferred
Units (or a portion thereof) to the General Partner for federal
income tax
purposes.
(d) Upon the redemption or purchase of part or all of any
Contributing
Party's Series B Preferred Units and the payment of the Purchase
Price with
respect thereto, such Person shall be deemed withdrawn as a Partner
in the
Partnership to the extent of the Series B Preferred Units redeemed
or purchased
and shall have no further rights or obligations under this
Agreement with
respect to such redeemed or purchased Series B Preferred Units;
provided,
however, that such Contributing Party's rights under this Agreement
with regard
to any other Series B Preferred Units will continue in full force
and effect.
(e) No fractional Shares shall be issued hereunder. In lieu of
fractional Shares, the General Partner shall pay cash based on the
per Share
liquidation preference on the relevant closing date.
(f) Notwithstanding anything to the contrary contained herein,
the
General Partner shall not issue the Share Purchase Price upon
exercise of any
Redemption Right by a Contributing Partner with respect to any
Series B
Preferred Units unless all of the Shares so issued are listed on
the New York
Stock Exchange and the Registration Statement (as herein defined)
covering such
Shares shall be in effect and available for use to effect a public
distribution
by the holder thereof of such Shares immediately upon such issuance
and the
General Partner only shall issue
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such Share Purchase Price to the extent that the issuance of such
Shares to such
Contributing Party does not violate the Certificate of
Incorporation (assuming
such Contributing Party owns no shares of capital stock of the
General Partner
other than those issued pursuant hereto and pursuant to the Common
Units
Redemption Rights Agreement).
3. Exercise of Redemption Rights.
3.1 Time for Exercise of Redemption Rights. Each Contributing Party
may
exercise its Redemption Rights in whole or in part and at any time
and from time
to time on or after the date hereof but prior to the Expiration
Date; provided,
however, that the Redemption Rights may not be exercised at any one
time by any
Contributing Party with respect to less than 2,000 Series B
Preferred Units (or
all the Series B Preferred Units then owned by such Contributing
Party if such
Contributing Party owns less than 2,000 Series B Preferred Units)
or in the
event that such exercise of Redemption Rights (or the assignment of
Series B
Preferred Units or delivery of either the Cash Purchase Price or
the Share
Purchase Price with respect thereto) violates the terms of the
Partnership
Agreement, the Certificate of Incorporation or applicable law. Once
given, a
Notice shall be irrevocable subject to the payment of the Purchase
Price for the
Series B Preferred Units specified therein in accordance with the
terms hereof.
3.2 Method of Exercise; Etc. The Redemption Rights shall be
exercised
by delivery to the Partnership of (a) written notice (the "Notice")
in the form
of Exhibit A specifying the number of the Series B Preferred Units
to be
redeemed and the name or names (with address) in which any Shares
issuable upon
such exercise shall be registered if different than the
Contributing Party and
(b) the certificates, if any, representing such Series B Preferred
Units.
Notwithstanding anything to the contrary contained herein, in the
event that (A)
all of the Series B Preferred Units of any deceased Contributing
Party or the
Series B Preferred Units of any partnership, limited liability
company or
pass-through entity that are allocable to a deceased partner,
member or other
Person have not been converted into Common Units on or prior to the
date of
death of such Contributing Party or other Person, and (B) the
exercise of the
Redemption Rights with respect to said Series B Preferred Units
shall not result
in the recognition of gain for federal income tax purposes by any
party, the
Partnership shall have the right to require the Contributing Party
or
partnership, limited liability company or other pass-through entity
or its legal
representative, to exercise the Redemption Rights as to all of such
Series B
Preferred Units and to take any and all necessary action hereunder
to effect
such exercise.
3.3
Closing. The closing of the redemption or purchase and sale
pursuant to an exercise of the Redemption Rights by any
Contributing Party shall
occur within 30 days following the giving of the Notice; provided,
however, that
no closing may occur hereunder prior to the earlier of the one
hundred twentieth
day after the date hereof and the date of effectiveness of the
Registration
Statement. Such Contributing Party shall execute such other
documents as the
General Partner may reasonably require in connection with the
closing of such
redemption or purchase and sale.
3.4 Payment of Cash or Issuance of Shares. At the closing of
the
redemption or purchase and sale of Series B Preferred Units
pursuant to an
exercise of Redemption Rights by a Contributing Party, the
Partnership shall
deliver to such Contributing Party the Cash Purchase Price by check
or, in the
event that the General Partner has assumed the obligations of
the
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Partnership with respect to such exercise of Redemption Rights, the
General
Partner shall deliver to such Contributing Party, at the election
of the General
Partner (which may be exercised in the General Partner's sole
discretion) either
(a) the Cash Purchase Price by check or (b) certificates
representing the Shares
and any other securities and/or other property constituting the
Share Purchase
Price, together with cash in lieu of the issuance of any fraction
of a Share as
provided in Section 2(e), or a combination thereof. In addition, in
the event
that the General Partner has assumed the obligations of the
Partnership with
respect to such exercise of Redemption Rights and delivers the
Share Purchase
Price, the General Partner also shall pay to such Contributing
Partner the
accrued and unpaid distributions in respect of the Series B
Preferred Units that
are acquired by the General Partner.
4. Matters Relating to Shares.
4.1 Registration.
(a) As soon as practicable following the date hereof, the
General
Partner shall file a Registration Statement on Form S-3 or other
appropriate
registration form (the "Registration Statement") with the SEC
covering the
resale by Contributing Parties of the Shares to be issued upon
exercise of the
Redemption Rights as to all Series B Preferred Units and full
satisfaction of
the Redemption Rights by delivery of Shares and/or the shares of
common stock of
the General Partner to be issued upon their conversion (all of such
shares
referred to hereafter in this Section 4.1 as the "Shares") and
shall use its
reasonable best efforts to cause the Registration Statement to
become effective
as soon as practicable thereafter. Following the effective date of
the
Registration Statement and until the Shares covered by the
Registration
Statement have been sold or are eligible for resale under Rule 1
