AGREEMENT
THIS AGREEMENT
is entered into and made effective as of August 22, 2005 (the
“ Agreement Date ”) by and between
BROC PORTFOLIO L.L.C. (“
Seller ”), a Delaware Limited Liability
Company and TANGER COROC, LLC (“
Buyer ”), a North Carolina Limited Liability
Company. Seller and Buyer are herein sometimes referred to as the
“ Parties ”.
RECITALS:
A.
COROC Holdings L.L.C. (the “
Company ”) is a Delaware limited liability
company operated pursuant to a Limited Liability Company Agreement
dated October 3, 2003 (the “ Company Operating
Agreement ”). Capitalized terms used herein which
are not otherwise defined herein shall have the meanings such terms
have in the Company Operating Agreement.
B.
Seller and Buyer are the owners and
holders of all of the Company’s Interests.
C.
Seller has agreed to sell to Buyer,
and Buyer has agreed to purchase from Seller, all of Seller’s
Interests in the Company upon and subject to the terms and
conditions of this Agreement.
NOW THEREFORE,
in consideration of the respective agreements and commitments set
forth herein and other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged by each of the
Parties, the Parties agree as follows:
1.
Basic Transaction
.
1.1
Sale and Purchase of
Seller’s Interests . On and subject to the terms and conditions of
this Agreement, Seller agrees to sell to Buyer, and Buyer agrees to
purchase from Seller, all of Seller’s Interests in the
Company (the “ Acquired Interest
”).
1.2
Purchase Price
. Buyer shall pay Seller at the
Closing Two Hundred Eighty-Two Million Five Hundred Thousand
Dollars ($282,500,000.00) (the “ Purchase
Price ”) in cash by wire transfer or delivery of
other immediately available guaranteed U.S. funds. There shall be
no adjustments to the Purchase Price.
1.3
The Closing
. Provided all conditions precedent
for Closing set forth in this Agreement have been satisfied or
waived by the appropriate party, the consummation of the
transaction contemplated herein (herein called the “
Closing ”) shall take place at the offices
of Simpson Thacher & Bartlett, 425 Lexington Avenue, New York,
New York 10017 at 10:00 a.m. on the thirtieth (30 th )
calendar day (or if such day is not a Business Day, the next
succeeding Business Day) following satisfaction of the condition
set forth in Section 4.7, and notice of such
satisfaction
has been received by both Parties (the “ Closing
Date ”); provided however, the Closing shall take
place on such earlier Business Day as set by Buyer in a written
notice (a “ Closing Date Notice ”)
received by Seller at least sixteen (16) calendar days (or such
shorter notice period as the Parties shall mutually agree upon) in
advance of said earlier Closing Date; and provided further, unless
the Parties mutually agree otherwise, the Closing Date shall not be
later than November 30, 2005.
1.4
Delivery at Closing
. At the Closing, (i) Seller will
deliver to Buyer the various certificates, instruments and
documents referred to in Paragraph 6.3(a) below, (ii) Buyer will
deliver to Seller the various certificates, instruments and
documents referred to in Paragraph 6.3(b) below, and (iii) Buyer
will pay and deliver to Seller the consideration specified in
Section 1.2 hereof.
1.5
Minimum Primary Return
. The Parties agree that
contemporaneously with the Closing, as a condition to
Seller’s obligations to close hereunder, the Company shall
make a distribution to Seller pursuant to Section 5.4(a)(i) of the
Company Operating Agreement in an amount sufficient to reduce
Seller’s Primary Return Account to zero.
1.6
Tanger Management Fee
. The Parties agree that prior to
Closing, as a condition to Buyer’s obligations to close
hereunder, the Company shall pay Tanger Properties Limited
Partnership (“ TPLP ”) a pro rated
portion of the Incentive Fee (as defined in the Management
Agreement) payable to TPLP pursuant to the Shopping Center
Management Agreement dated December 19, 2003 (the “
Management Agreement ”). Such pro rated
Incentive Fee shall be an amount determined by multiplying (i) the
Incentive Fee that would be payable for the full 2005 calendar year
if the Company’s Net Operating Income (as determined in the
Management Agreement) for the year had been $50,340,000 by (ii) a
fraction the numerator of which is the number of days in 2005 prior
to and through the Closing Date and the denominator of which is
365.
2.
Representations and Warranties of
Seller . Seller
represents and warrants to Buyer that the statements contained in
this Section are correct and complete as of the date of this
Agreement and will be correct and complete as of the Closing Date
(as though made then and as though the Closing Date were
substituted for the date of this Agreement throughout this Section)
except as set forth in the Disclosure Schedule delivered by Seller
to Buyer on the date hereof and initialed by the Parties (the
“ Seller’s Disclosure Schedule
”). The Seller’s Disclosure Schedule will be arranged
in paragraphs corresponding to the lettered and numbered paragraphs
contained in this Section 2.
2.1
Representations and Warranties
Concerning the Transaction
(a)
Organization of Seller
. Seller is a limited liability
company duly formed, validly existing and in good standing under
the laws of the State of Delaware.
(b)
Authorization of
Transaction . Seller has
full power and authority (including full power and authority as a
limited liability company) to execute and deliver this Agreement
and to perform its obligations hereunder. This Agreement
constitutes the valid and legally binding obligation of Seller,
enforceable in accordance with its terms and conditions. Seller
need not give any notice to, make any filings with, or obtain any
authorization, consent, or approval of, any government or
governmental agency in order to consummate the transactions
contemplated by this Agreement. The execution, delivery and
performance of this Agreement and all other agreements contemplated
hereby have been duly authorized by Seller, including, without
limitation, due authorization by all of Seller’s
members.
(c)
Noncontravention
. Neither the execution and
delivery of this Agreement, nor the consummation of the
transactions contemplated hereby, will (i) violate any
constitution, statute, regulation, rule, injunction, judgment,
order, decree, ruling, charge or other restriction of any
government, governmental agency or court to which Seller is subject
or any provision of the Articles of Organization or Operating
Agreement of Seller; (ii) conflict with, result in a breach of,
constitute a default under, result in the acceleration of, create
in any party the right to accelerate, terminate, modify, or cancel,
or require any notice under any agreement, contract, lease,
license, instrument or other arrangement to which Seller is a party
or by which it is bound or to which any of its assets is subject;
or (iii) result in the imposition or creation of a Lien upon or
with respect to the Acquired Interest. Seller is not required to
give any notice to, make any filing with, or obtain any
authorization, consent or approval of any government or
governmental agency in order for the Parties to consummate the
transactions contemplated by this Agreement.
(d)
Brokers’ Fees
. Seller has no liability or
obligation to pay any fees or commissions to any broker, finder, or
agent with respect to the transactions contemplated by this
Agreement for which Buyer could become liable or
obligated.
(e)
Ownership and Transfer of
Acquired Interest .
Seller holds of record and owns beneficially the Acquired Interest
free and clear of any restrictions on transfer (other than any
restriction under (i) the Securities Act and state securities laws,
and (ii) the Company Operating Agreement), taxes, Liens, options,
warrants, purchase rights, contracts, commitments, equities, claims
and demands. Seller is not a party to any option, warrant, purchase
right or other contract or commitment (other than this Agreement
and the Company Operating Agreement) that could require Seller to
sell, transfer or otherwise dispose of any ownership interest in
the Company. Seller is not a party to any agreement or
understanding with respect to the voting of any ownership interest
in the Company other than the Company Operating
Agreement.
2.2
Representations and Warranties
Concerning the Company
(a) Seller has
not received notice of, and has no Knowledge of, (i) any third
party claim against the Company or any of its Subsidiaries, or (ii)
any violation by the Company or any of its Subsidiaries of any
statute, regulation, rule, injunction, order, decree, ruling, or
charge of any government, governmental agency or court, in each
case which claim or violation has not been disclosed to Buyer or of
which Buyer is not otherwise aware.
(b) Seller has
not taken any action that, to its Knowledge, (i) would bind or
obligate the Company, (ii) is in material violation of the Company
Operating Agreement, or (iii) would cause the Company or any
Subsidiary to take any action in violation of the limited liability
company agreement of any of its Subsidiaries, except, in each case
(A) pursuant to a Member Consent approved by the Tanger Member or
(B) as otherwise permitted by the Company Operating Agreement
without a Member Consent, provided that in the case of this clause
(B) Seller has disclosed such action to Buyer or Buyer has
Knowledge of such action.
3.
Representations and Warranties of
Buyer . Buyer represents
and warrants to Seller that the statements contained in this
Section 3 are correct and complete as of the date of this Agreement
and will be correct and complete as of the Closing Date (as though
made then and as though the Closing Date were substituted for the
date of this Agreement throughout this Section 3) except as set
forth in the Disclosure Schedule delivered by Buyer to Seller on
the date hereof and initialed by the Parties (the “
Buyer’s Disclosure Schedule ”). The
Buyer’s Disclosure Schedule will be arranged in paragraphs
corresponding to the lettered and numbered paragraphs contained in
this Section 3.
3.1
Organization of Buyer
. Buyer is a limited liability
company duly formed, validly existing and in good standing under
the laws of the State of North Carolina.
3.2
Authorization of
Transaction . Buyer has
full power and authority (including full power and authority acting
as a limited liability company) to execute and deliver this
Agreement and to perform its obligations hereunder. This Agreement
constitutes the valid and legally binding obligation of Buyer
enforceable in accordance with its terms and conditions. Buyer need
not give any notice to, make any filings with or obtain any
authorization, consent or approval of any government or
governmental agency in order to consummate the transactions
contemplated by this Agreement.
3.3
Noncontravention
. Neither the execution and
delivery of this Agreement, nor the consummation of the
transactions contemplated hereby, will (i) violate any
constitution, statute, regulation, rule, injunction, judgment,
order, decree, ruling, charge or other restriction of any
government, governmental agency, or court to which Buyer is subject
or any provision of the articles of organization or operating
agreement of Buyer; or (ii) conflict with, result in a breach of,
constitute a default under, result in the acceleration of, create
in any party the right to accelerate, terminate, modify or cancel
or require any notice under any agreement, contract, lease, license
instrument or other arrangement to which Buyer is a party or by
which it is bound or to which any of its assets are subject. Buyer
is not required to give any notice to, make any filing with, or
obtain any authorization, consent or approval of any government or
governmental agency in order for the Parties to consummate the
transactions contemplated by this Agreement.
3.4
Brokers’ Fees
. Buyer has no liability or
obligation to pay any fee or commissions to any broker, finder or
agent other than Compass Advisers, LLP (“
Compass ”) with respect to the transactions
contemplated by this Agreement for which Seller could become liable
or obligated. Buyer shall pay any fees or commissions payable to
Compass pursuant to a separate agreement between Buyer and
Compass.
4.
Pre-Closing Covenants
. The Parties agree as follows with
respect to the period between the execution of this Agreement and
the Closing:
4.1
General . Each of the Parties will use its reasonable
best efforts to take all action and to do all things necessary,
proper or advisable in order to consummate and make effective the
transactions contemplated by this Agreement (including
satisfaction, but not waiver, of the closing conditions set forth
in Section 6 below).
4.2
Notices and Consents
. Each Party will give any notices,
make any filings with, and use its reasonable best efforts to
obtain any authorizations, consents and approvals of governments
and governmental agencies in connection with the matters, if any,
referred to in Sections 2 and 3 above.
4.3
Operation of Business
. Seller will not take any action
that (i) would bind or obligate the Company, (ii) is in material
violation of the Company Operating Agreement, or (iii) would cause
the Company or any Subsidiary to take any action in violation of
the limited liability company agreement of any of its Subsidiaries,
except, in each case (A) pursuant to a Member Consent approved by
the Tanger Member or (B) as otherwise permitted by the Company
Operating Agreement without a Member Consent, provided that in the
case of this clause (B) Seller has disclosed such action to Buyer
or Buyer has Knowledge of such action.
4.4
Intentionally Omitted
.
4.5
Notice of Developments
. Each Party will give prompt,
written notice to the other Party of any material adverse
development causing a breach of any of its own representations and
warranties in Sections 2 and 3 above. No disclosure by any Party
pursuant to this Section 4 however, shall be deemed to amend or
supplement the Disclosure Schedule or to prevent or cure any
misrepresentation, breach of warranty or breach of
covenant.
4.6
Exclusivity
. During the term of this Agreement,
Seller will not (and Seller will not exercise its rights as a
Member of the Company to cause or permit the Company or any of its
Subsidiaries to) (i) solicit, initiate or encourage the submission
of any proposal or offer from any Person relating to the
acquisition of Seller’s Interests in the Company or any
substantial portion of the assets of the Company or any of its
Subsidiaries; or (ii) participate in any discussions or
negotiations regarding, furnish any information with respect to,
assist or participate in, or facilitate in any other manner any
effort or attempt by any Person to do or seek any of the foregoing.
During the term of this Agreement, Seller will not vote its
Interests in favor of any such acquisition without Buyer’s
consent, and will notify Buyer immediately if any Person makes any
proposal, offer, inquiry of contract to Seller with respect to any
of the foregoing.
4.7
GMAC Conditions
. Seller and Buyer will each use
their reasonable best efforts to satisfy such conditions in
connection with the sale and purchase of the Acquired Interest
pursuant to the loan documents evidencing and securing a loan from
GMAC Commercial Mortgage Corporation in the original aggregate
principal amount of $200 Million assumed by the Company and its
Subsidiaries; provided that such reasonable best efforts shall not
be deemed to required either Party to agree to pay GMAC any fees,
prepayments or other amounts except as expressly provided in the
loan documents for such loan. Buyer and Seller shall be responsible
for and each shall pay one-half of any costs or fees associated
with satisfying such conditions.
5.
Post Closing Covenants
. The Parties agree as follows with
respect to the period following the Closing:
5.1.
General . In case at any time after the Closing any
further actions are necessary to carry out the purposes of this
Agreement, each of the Parties will take such further actions
(including the execution and delivery of such further instruments
and documents) as any other Party may reasonably request, all at
the sole costs and expense of the requesting party (unless the
requesting party is entitled to indemnification therefore under
Section 8 of this Agreement). Seller acknowledges and agrees that,
from and after the Closing, Buyer will be entitled to possession of
all documents, books, records (including tax records), agreements
and financial data of any sort relating to the Company and its
Subsidiaries, provided that Seller shall be entitled to retain a
copy of any such financial data, records, agreements or documents
currently in Seller’s possession to the extent necessary for
Seller’s tax filings, accounting or financial reporting. For
a period of three years after the Closing, at Seller’s
request, Buyer shall provide Seller with reasonable access to the
books and records of the Company for the period prior to the
Closing to the extent reasonably necessary for Seller’s tax
filings, accounting or financial reporting, such agreement to
survive the Closing.
5.2
Litigation Support
. In the event and for so long as
any Party actively is contesting or defending against any action,
suit, proceeding, hearing, investigation, charge, complaint, claim
or demand in connection with (i) any transaction contemplated under
this Agreement; or (ii) any fact, situation, circumstance, status,
condition, activity, practice, plan, occurrence, event, incident,
action, failure to act or transaction on or prior to the Closing
Date involving the Company or any of its Subsidiaries, each of the
other Parties will cooperate with it and/or its counsel in the
contest or defense, make available its personnel and provide such
testimony and access to its books and records as shall be required
in connection with the contest or defense, all at the sole costs
and expense of the contesting or defending party (unless the
contesting or defending party is entitled to indemnification
therefore under Section 8 of this Agreement). This Section 5.2
shall not apply to any action, suit, proceeding, hearing,
investigation, charge, complaint, claim or demand between Seller
and Buyer.
5.3.
Intentionally Omitted
.
5.4.
Confidentiality
. Seller will treat and hold as such
all of the Confidential Information, refrain from using any of the
Confidential Information, except in connection with this Agreement,
and deliver promptly to Buyer or destroy, at Seller’s option,
all tangible embodiments (and all copies) of the Confidential
Information that are in its possession. In the event that Seller is
requested or required pursuant to oral or written question or
request for information or documents in any legal proceeding,
interrogatories, subpoena, civil investigation, demand, or similar
process to disclose any Confidential Information, Seller will
notify Buyer promptly of the request or requirement so that Buyer
may seek an appropriate protective order or waive compliance with
the provisions of this sub-section 5.4. If, in the absence of a
protective order, or the receipt of a wavier hereunder, Seller is,
on advice of counsel, compelled to disclose any Confidential
Information to any tribunal, Seller may disclose the Confidential
Information to the tribunal; provided, however, that Seller shall
use its reasonable best efforts to obtain, at the reasonable
request of Buyer and at Buyer’s sole cost and expense, an
order or other assurance that confidential treatment will be
accorded to such portion of the Confidential Information required
to be disclosed as Buyer shall designate.
5.5.
Intentionally Omitted
.
6.
Conditions to Obligation to
Close .
6.1
Conditions to Obligations of
Buyer . The obligations
of Buyer to consummate the transactions to be performed by it in
connection with the Closing are subject to satisfaction of the
following conditions:
(a)
The representations and warranties
of Seller set forth in Section 2 above shall be true and correct in
all material respects at and as of the Closing Date;
(b)
Seller shall have performed and
complied with all of its covenants hereunder in all material
respects through the Closing;
(c)
The Company and its Subsidiaries
shall have procured any of the third party consents specified in
Section 2 above and the Seller’s Disclosure
Schedule;
(d)
No action, suit or proceeding shall
have been brought by any Person (other than the parties hereto or
any of such parties’ affiliates) and be pending before any
court or quasi judicial or administrative agency of any federal,
state, local or foreign jurisdiction or before any arbitrator
wherein an unfavorable injunction, judgment, order, decree, ruling
or charge would (A) prevent consummation of any of the transactions
contemplated by this Agreement, (B) cause any of the transactions
contemplated by this Agreement to be rescinded following
consummation, (C) materially and adversely affect the right of
Buyer to acquire the Acquired Interest or (D) materially and
adversely affect the right of th
