EXHIBIT 5
PURCHASE AGREEMENT
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THIS PURCHASE AGREEMENT, dated as of September 9, 2003, by and among The
Price Group LLC ("Price"), and Warburg, Xxxxxx Equity Partners, L.P. ("WPEP"),
Warburg, Xxxxxx Netherlands Equity Partners I, C.V., Warburg, Xxxxxx Netherlands
Equity Partners II, C.V., and Warburg, Xxxxxx Netherlands Equity Partners III,
C.V. (together with WPEP, Warburg, Xxxxxx Netherlands Equity Partners I, C.V.,
and Warburg, Xxxxxx Netherlands Equity Partners II, C.V., the "Sellers").
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties hereto agree as follows:
1. Subject to and in reliance upon the covenants set forth below, Price
hereby agrees to purchase or to arrange for the purchase by one or more
assignees from the Sellers (but in any event to be and remain responsible and
liable for the payments to Sellers and for its other obligations herein as
provided in Section 6 below), and the Sellers agree to sell to Price and/or such
assignees, on the date of the Closing all of the Sellers' right, title and
interest in and to (i) the 17,985,612 shares of Series B Junior Convertible
Redeemable Preferred Stock of the Price Legacy Corporation (the "Company") held
in the aggregate by the Sellers (the "Series B Stock"), including any dividends
accrued thereby, (ii) the 5,000,000 shares of common stock of the Company (the
"Common Stock") held in the aggregate by the Sellers and (iii) the warrant for
the purchase of 2,500,000 shares of Common Stock (the "Warrant") held by WPEP
((i), (ii) and (iii), collectively, the "Warburg Pincus Holdings") at the
Closing (as defined below) for an aggregate purchase price of $138,000,000 (the
"Purchase Price"). The closing of such sale and purchase shall take place at the
offices of Xxxxxxx Xxxx & Xxxxxxxxx, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 on January 5, 2004 (the "Closing").
2. The Sellers hereby make the following representations and warranties
to Price:
(a) Upon consummation of the transactions contemplated hereby, Price
(and/or its assignees) will acquire good and valid title to the Warburg Pincus
Holdings, constituting all of the shares of Series B Stock, Common Stock and
warrants for the purchase of the Common Stock of the Company held of record or
beneficially by Sellers, free and clear of any liens, restrictions on transfer
(other than any restrictions under the Securities Act of 1933, as amended (the
"Securities Act") or other applicable securities laws and restrictions relating
to maintaining the Company's status as a real estate investment trust (a "REIT")
pursuant to the Internal Revenue Code), options, warrants, rights, calls,
commitments, proxies or other contract rights. None of the Sellers has
transferred record or beneficial ownership of any securities of the Company to
any other person since September 30, 2001, nor will any of the Sellers transfer
record or beneficial ownership of any securities of the Company to any other
person prior to the Closing hereunder.
(b) The Sellers have all requisite power and authority to execute and
deliver this Agreement and to perform their obligations hereunder and to
consummate the
transactions contemplated hereby. The execution and delivery by the Sellers of
this Agreement and the performance by the Sellers of their obligations hereunder
have been duly and validly authorized by all requisite action on the part of
each Seller. This Agreement has been duly executed and delivered by the Sellers
and constitutes the legal, valid and binding obligation of each Seller,
enforceable against each Seller in accordance with its terms.
3. Price hereby makes the following representations and warranties to the
Sellers:
(a) Price has all requisite power and authority to execute and deliver
this Agreement and to perform its obligations hereunder and to consummate the
transactions contemplated hereby. The execution and delivery by Price of this
Agreement and the performance by Price of its obligations hereunder have been
duly and validly authorized by all requisite action on the part of Price. This
Agreement has been duly executed and delivered by Price and constitutes the
legal, valid and binding obligation of Price, enforceable against Price in
accordance with its terms.
(b) Price has, or will have at the time of the Closing, sufficient funds
(through investment partners, assignees or otherwise) to pay the Purchase Price.
(c) Price is an "accredited investor" within the meaning of Rule 501(a) of
Regulation D promulgated under the Securities Act and understands that the
Series B Stock and the Warrant (together, the "Restricted Securities") have not
been registered under the Securities Act, nor qualified under any state
securities laws, and that they are being sold pursuant to an exemption from such
registration and qualification based in part upon Price's representations
contained herein. Price has such knowledge and experience in financial and
business matters that Price is capable of evaluating the merits and risks of the
investment contemplated by this Agreement and is able to bear the economic risk
of this investment in the Company (including a complete loss of this
investment).
Price is acquiring the Restricted Securities solely for its own account for
investment and not with a view to the distribution thereof (as that term is used
in the Securities Act), nor with any present intention of engaging or
participating in such a distribution of the Restricted Securities.
4. (a) The Sellers hereby agree that they shall vote their Series B Stock
and Common Stock in favor of any proposals approved by the Company's Board of
Directors and authorized in accordance with the Company's organizational
documents.
(b) The Sellers hereby assign to Price, effective upon the Closing,
all claims and causes of action against the Company that the Sellers have from
September 18, 2001 to the date of this agreement that relate to the Sellers'
ownership interests in the Company.
5. (a) No later than 72 hours after the execution of this Agreement,
Price shall pay to the order of the Sellers via wire transfer the amount of
$5,000,000 in
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immediately available funds (the "Deposit Amount"), which amount shall applied
towards the payment of the Purchase Price at Closing.
(b) Price hereby agrees that, in the event that the transactions
contemplated hereby have not been completed on or before January 5, 2004, the
obligations of the Sellers under this Agreement will terminate and the Sellers
shall retain the Deposit Amount. Price and Sellers hereby agree that such
retention of the Deposit Amount is a necessary inducement for the Sellers to
agree to the transactions contemplated by this Agreement.
6. Price may assign all or any part of its rights but none of its
obligations hereunder to another party provided that such party agrees to
provide the representations and warranties provided by Price herein, to be bound
by the terms hereof and to provide such additional representations and
warranties and covenants to Sellers as Sellers may reasonably request. In any
event, Price shall be responsible for any breach of any representations and
warranties or other breaches of this Agreement by any assignee of Price.
7. Except for the warranties, promises and obligations set forth in this
Agreement, Price and each of the Sellers each hereby fully and forever releases
and discharges the other and its respective legal representatives, predecessors,
successors, and assigns from any and all claims, demands, covenants, actions,
suits, causes of action, and liabilities of any and every nature, character and
description, in law, equity or otherwise, whether known or unknown, whether
suspected or unsuspected, whether contingent or noncontingent, relating to their
investment in the Company or otherwise, which any of them now owns or holds
against any of the others. Each of Price and each of the Sellers them hereby
expressly waives any and all rights which he or she may have under the
provisions of Section 1542 of the California Civil Code in respect thereof, if
applicable, which section has been duly and sufficiently explained to the
parties and provides:
"CERTAIN CLAIMS NOT AFFECTED BY GENERAL RELEASE. A general release does
not extend to claims which the creditor does not know or suspect to exist in his
favor at the time of executing the release, which if known by him must have
materially affected his settlement with the debtor."
8. (a) This Agreement shall be governed by and construed and enforced in
accordance with the laws of New York, excluding those laws that direct the
application of the laws of another jurisdiction.
(b) A party that breaches any provision of this Agreement shall be liable,
in addition to any other remedies available at law or in equity, for all costs
and expenses, including, without limitation, reasonable attorneys' fees in
connection with the enforcement of the non-breaching party's rights hereunder.
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(c) Without limiting or waiving in any respect any rights or remedies of
the Sellers under this Agreement now or hereinafter existing at law or in equity
or by statute, each of the Sellers shall be entitled to seek specific
performance of the obligations to be performed by Price in accordance with the
provisions of this Agreement, including without limitation the completion of the
transactions contemplated hereby. For the avoidance of doubt, the rights
provided in this Section 8(c) shall in no way be limited or waived by the
Sellers' retention of the Deposit Amount.
9. This Agreement may be executed in original form or via facsimile in
counterparts, each of which shall be deemed to be an original.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first set forth above.
THE PRICE GROUP, LLC
By: /s/ Xxxx XxXxxxx
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Name: Xxxx XxXxxxx
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WARBURG, XXXXXX EQUITY
PARTNERS, X.X.
XXXXXXX, XXXXXX NETHERLANDS
EQUITY PARTNERS I, X.X.
XXXXXXX, XXXXXX NETHERLANDS
EQUITY PARTNERS II, X.X.
XXXXXXX, XXXXXX NETHERLANDS
EQUITY PARTNERS III, C.V.
By: Warburg Pincus & Co.
General Partner
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
Title: Partner
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