EX 99(d)(12)
WESTFIELD AMERICA TRUST
c/o Westfield America Management Limited
Xxxxx 00 Xxxxxxxxx Xxxxxx
000 Xxxxxxxx Xxxxxx
Xxxxxx, XXX Xxxxxxxxx 0000
February 14, 0000
Xxxxxx Xxxx Xxxxxxxxxx Xxxxx Member LLC
c/o X.X. Xxxxxx Investment Management Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: PUT OPTION AGREEMENT
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Ladies and Gentlemen:
Reference is made to (A) the Put Option Agreement, dated June
23, 1999 (the "AGREEMENT"), among Valley Fair University Towne Member LLC
("VFUT"), a Delaware limited liability company, WEA Valley Fair UTC LLC, a
Delaware limited liability company ("WEA VALLEY FAIR"), and Westfield America,
Inc., a Missouri corporation ("WEA"), pursuant to which VFUT has the right to
exchange its interest in (i) Valley Fair UTC LLC, or (ii) either University
Towne Center LLC, a Delaware limited liability company, or VF Mall LLC, a
Delaware limited liability company, in each case, for shares of common stock of
WEA, and (B) the Registration Rights Agreement, dated June 23, 1999, between WEA
and VFUT (the "REGISTRATION RIGHTS AGREEMENT"). Capitalized terms used but not
defined herein shall have the meanings ascribed to such terms in the Agreement.
This letter confirms our agreement as follows:
(1) Westfield America Management Limited ("WAML"), in its
capacity as responsible entity and trustee of Westfield America Trust (the
"MANAGER"), holds the majority of outstanding common shares in WEA.
(2) VFUT agrees to, and the Manager agrees to cause WEA to, as
soon as practicable following the consummation of the Merger (as defined
herein), enter into an amendment to the Agreement for the purpose of deleting
references to WEA's common share price in order to revise the basis on which the
numbers of WEA common shares will be calculated upon the exercise of the option,
with the result that the number of WEA common shares to be received by VFUT
would be that number of common shares to which is attributable the same amount
of FFO as is attributable to the interest to be put. The
amendment is not intended to affect the economic results to either VFUT or WEA
as a result of exercising the put option.
(3) (a) The Manager agrees to issue an option (the "WAT
OPTION") to VFUT pursuant to which, at any time simultaneous with or after the
exercise of the LLC Put Option or the Mall Put Option, VFUT has the right to
exchange WEA common shares received under the Agreement for cash or ordinary
units in WAT (at the Manager's election), calculated based on the WAT/WEA
exchange ratio. The Manager represents that the current exchange ratio is 20.16
WAT ordinary units per WEA common share, which is subject to adjustment for any
recapitalizations of WEA or WAT. The Manager shall, and the Manager shall cause
WEA to, provide VFUT with such information as VFUT shall reasonably request to
confirm the current exchange ratio. If cash in lieu of WAT ordinary units is
delivered it shall be delivered in an amount equal to the market value of the
WAT ordinary units that were to be delivered. If the Manager elects to deliver
WAT ordinary units and if VFUT is prohibited from owning WAT ordinary units
pursuant to applicable law or the owning of such WAT ordinary units would cause
VFUT or any of its direct or indirect members or participants to realize
unrelated business taxable income ("UBTI") under Section 511-514 of the Internal
Revenue Code of 1986, as amended, then WAT and VFUT agree to negotiate in good
faith to structure VFUT's ownership of the WAT ordinary units so that such
ownership is lawful under applicable law and so that VFUT or any of its direct
or indirect members or participants will not realize any UBTI. If the parties
are not able to structure VFUT's ownership in the manner described above, then
WAT will deliver cash to VFUT in lieu of WAT ordinary units at the reasonable
expense of VFUT, which reasonable expenses shall include, but are not limited
to, the expense of underwriting or otherwise liquidating the WAT ordinary units.
(b) The WAT Option will provide that the Manager will use
its best efforts to ensure that the ordinary units in WAT (including the
ordinary units issued on the exercise of the WAT Option) are officially quoted
on the Australian Stock Exchange, as soon as possible after they are issued, and
that such official quotation is maintained.
(c) The WAT Option will provide that the Manager shall
indemnify VFUT and its members for any and all taxes, levies and similar charges
(including interest and penalties thereon and including any taxes, interest or
penalties incurred as a result of the receipt of any indemnity payment
hereunder) and reasonable transaction costs incurred by VFUT, its members or by
any entity formed to acquire the WAT ordinary units in connection with the
acquisition or disposition of any WAT ordinary units acquired by VFUT pursuant
to the WAT Option, that would not have been incurred by VFUT or its members in
an acquisition or disposition of WEA common shares as contemplated by the
original Agreement and the Registration Rights Agreement; PROVIDED, HOWEVER,
that WAT shall not indemnify VFUT or its members for such taxes, levies or other
charges (i) attributable solely to economic appreciation in the WAT ordinary
units occurring after the date on which such units are acquired, or (ii) with
respect to a disposition of the WAT ordinary units if such disposition is not
completed within sixty (60) days of the date on which such ordinary units are
acquired pursuant to the exercise of the WAT Option.
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Notwithstanding any other provision of this letter agreement, the Manager shall
not indemnify VFUT for any tax liability incurred by VFUT as a result of its
ownership of any WAT ordinary units other than those acquired pursuant to the
WAT Option. Although VFUT shall have no duty to seek any refund or challenge any
tax, levy or other similar charge, in the event VFUT receives a refund of any
amount which gave rise to an indemnification payment hereunder, it shall refund
the indemnification payment to the Manager to the extent of the refund, net of
collection or other costs (including any additional taxes) related thereto;
PROVIDED, HOWEVER, that in connection with the indemnification, the Manager
shall be entitled to reasonable contest rights to be specified in the WAT
Option.
(4) The Manager shall, and the Manager shall cause WEA to,
comply with all applicable Australian and United States laws and obtain all
applicable approvals necessary for the Manager and WEA to consummate the
transactions contemplated hereby.
(5) VFUT agrees to, and the Manager shall cause WEA to, as
soon as practicable following the consummation of the Merger, enter into an
agreement with VFUT to terminate the Registration Rights Agreement.
(6) The Manager and VFUT's obligations to undertake the above
transactions shall be subject to (i) documentation reasonably satisfactory to
the Manager and VFUT; (ii) the consummation of the merger transaction (the
"MERGER") between WEA and WAML, in its capacity as responsible entity and
trustee of Westfield America Trust ("WAT"); (iii) approval of the members of WAT
of the issuance of the WAT Option to VFUT; and (iv) VFUT's reasonable
satisfaction that the current exchange ratio is 20.16 WAT ordinary units per WEA
common share.
(7) The Manager agrees to reimburse VFUT for its reasonable
external costs, fees and expenses (including, without limitation, legal and
accounting costs, fees and expenses) in connection with VFUT's negotiation of
this letter agreement and the documents contemplated hereby.
(8) The Manager and VFUT agree, to the extent practicable, to
structure the transactions contemplated by this letter agreement in a manner so
that neither VFUT nor any of its direct or indirect members of participants will
incur any UBTI.
This letter agreement shall be governed by and construed in
accordance with the laws of the State of New York, including, without
limitation, Section 5-1401 of the New York General Obligations Law.
This letter agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which shall,
taken together, be considered one and the same agreement and shall become
effective when one or more counterparts have been signed by each of the parties
and delivered to the other parties.
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After reviewing this letter agreement, please indicate your
acceptance and acknowledgment of our agreement as set forth above by signing and
returning a copy of this letter to the undersigned at Westfield America
Management Limited, Level 24 Westfield Towers, 000 Xxxxxxx Xxxxxx, Xxxxxx XXX
Xxxxxxxxx 0000.
Very truly yours,
WESTFIELD AMERICA MANAGEMENT LIMITED,
in its capacity as responsible entity and
trustee of Westfield America Trust
By: /s/ XXXXX X. XXXX
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Xxxxx X. Xxxx
Authorized Signatory
ACCEPTED AND ACKNOWLEDGED:
VALLEY FAIR UNIVERSITY TOWNE
MEMBER LLC
By: /s/ XXXXXXXX XXXXXX
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Name: Xxxxxxxx Xxxxxx
Title: Vice President
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