<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Act of 1934
Date of Report (Date of Earliest Event Reported)
July 8, 1999
General Growth Properties, Inc.
(Exact name of registrant as specified in its charter)
Delaware 1-11656 42-1283895
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification
incorporation) Number)
110 N. Wacker Drive, Chicago, Illinois 60606
(Address of principal executive offices) (Zip Code)
(312) 960-5000
(Registrant's telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
<PAGE> 2
Item 5. Other Events
On July 8, 1999, General Growth Properties, Inc. (the "Company") and
GGP Limited Partnership entered into an Underwriting Agreement with Lehman
Brothers Inc. (the "Underwriter"), relating to the issuance and sale by the
Company of 10,000,000 shares of its common stock for an aggregate purchase
price of $332,225,000, or $33.2225 per share. The issuance and sale of the
common stock was consummated on July 14, 1999. The Company has granted the
Underwriter an option, exercisable for 30 days after July 8, 1999, to purchase
up to 1,000,000 additional shares of common stock, solely to cover
over-allotments. If this option is exercised in full, the total proceeds to the
Company will be $365,447,500, before deducting expenses payable by the Company,
estimated to be approximately $500,000. The net proceeds to the Company from
the offering, after deduction of expenses payable by the Company, are estimated
to be approximately $331,725,000 ($364,947,500 if the Underwriter's
overallotment option is exercised in full). The shares of common stock were
registered under the Securities Act of 1933, as amended, pursuant to the
Company's Registration Statement on Form S-3 (File No. 333-37247).
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
(a), (b) not applicable.
(c) Exhibits
See Exhibit Index attached hereto and incorporated herein.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GENERAL GROWTH PROPERTIES, INC.
By:/s/ Bernard Freibaum
-------------------------------
Bernard Freibaum
Executive Vice President and
Chief Financial Officer
Date: July 14, 1999
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EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Name Page
Number Number
<S> <C> <C>
1.1 Underwriting Agreement, dated July 8, 1999, among General
Growth Properties, Inc., GGP Limited Partnership and Lehman
Brothers Inc.
8.1 Tax Opinion of Neal, Gerber & Eisenberg, counsel for the
Company.
23.1 Consent of Neal, Gerber & Eisenberg (included
in Exhibit 8.1).
</TABLE>
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Exhibit 1.1
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10,000,000 SHARES
GENERAL GROWTH PROPERTIES, INC.
COMMON STOCK
UNDERWRITING AGREEMENT
July 8, 1999
LEHMAN BROTHERS INC.
As Representative of the several
Underwriters named in Schedule I,
c/o Lehman Brothers Inc.
Three World Financial Center
New York, New York 10285
Ladies and Gentlemen:
General Growth Properties, Inc., a Delaware corporation (the "Company")
and the general partner of GGP Limited Partnership, a Delaware limited
partnership (the "Operating Partnership"), proposes to issue and sell up to an
aggregate of 10,000,000 shares of the Company's common stock par value $.10 per
share (the "Common Stock"). Subject to the terms and conditions stated herein,
the Company hereby agrees to sell to the firms named in Schedule 1 hereto (the
"Underwriters"), and each of the Underwriters agrees, severally and not jointly,
to purchase from the Company, at the time and place and at the purchase price to
the Underwriters set forth in Schedule II hereto, the number of shares of Common
Stock set forth in Schedule I hereto (the "Firm Shares"). At the election of the
Underwriters, the Underwriters may purchase up to an additional 1,000,000 shares
of the Common Stock on the terms and for the purposes set forth in Section 2
hereof (the "Option Shares"). The Firm Shares and the Option Shares, if
purchased, are herein collectively called "Shares". In the event and to the
extent that the Underwriters shall exercise the election to purchase Option
Shares pursuant to Section 2 and subject to the terms and conditions stated
therein, the Company agrees to issue and sell to each of the Underwriters, and
each of the Underwriters agree, severally and not jointly, to purchase from the
Company at the purchase price to the Underwriters set forth in Schedule II
hereto that portion of the number of Option Shares as set forth in Section 2
hereof as to which such election shall have been exercised.
This is to confirm the agreement concerning the purchase of the Shares
from the Company by the Underwriters.
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2
1. The Company and the Operating Partnership, jointly and severally,
represent and warrant to, and agree with, each of the Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-37247)
in respect of the Shares has been filed with the Securities and
Exchange Commission (the "Commission"); such registration statement and
any post-effective amendment thereto, each in the form heretofore
delivered or to be delivered to you as the representative (the
"Representative") of the Underwriters and, excluding exhibits to such
registration statement, but including all documents incorporated by
reference in the prospectus included therein, to the Representative for
each of the other Underwriters have been declared effective by the
Commission in such form; no other document with respect to such
registration statement or document incorporated by reference therein
has heretofore been filed, or transmitted for filing, with the
Commission (other than documents incorporated by reference in such
prospectus and prospectuses filed pursuant to Rule 424(b) of the rules
and regulations of the Commission under the Securities Act of 1933, as
amended (the "Act"), each in the form heretofore delivered to the
Representative); and no stop order suspending the effectiveness of such
registration statement has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (any
preliminary prospectus included in such registration statement or filed
with the Commission pursuant to Rule 424(a) under the Act, is
hereinafter called a "Preliminary Prospectus"; the various parts of
such registration statement, including all exhibits thereto and the
documents incorporated by reference in the prospectus contained in the
registration statement at the time such part of the registration
statement became effective, each as amended at the time such part of
the registration statement became effective, are hereinafter
collectively called the "Registration Statement"; the prospectus
relating to the Shares, in the form in which it has most recently been
filed, or transmitted for filing, with the Commission on or prior to
the date of this Agreement, is hereinafter called the "Prospectus"; any
reference herein to any Preliminary Prospectus or the Prospectus shall
be deemed to refer to and include the documents incorporated by
reference therein pursuant to the applicable form under the Act, as of
the date of such Preliminary Prospectus or Prospectus, as the case may
be; any reference to any amendment or supplement to any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and include
any documents filed after the date of such Preliminary Prospectus or
Prospectus, as the case may be, under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and incorporated by reference in
such Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment to the Registration Statement shall be
deemed to refer to and include any annual report of the Company filed
pursuant to Section 13(a) or 15(d) of the Exchange Act after the
effective date of the Registration Statement that is incorporated by
reference in the Registration Statement; and any reference to the
Prospectus as amended or supplemented shall be deemed to refer to the
Prospectus as amended or supplemented in the form in which it is filed
with the Commission pursuant to Rule 424(b) under the Act in accordance
with Section 4(a) hereof, including any documents incorporated by
reference therein as of the date of such filing);
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(b) The documents incorporated by reference in the Prospectus,
when they became effective or were filed with the Commission, as the
case may be, conformed in all material respects to the requirements of
the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder, and none of such documents
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; and any further documents so filed
and incorporated by reference in the Prospectus or any further
amendment or supplement thereto, when such documents become effective
or are filed with the Commission, as the case may be, will conform in
all material respects to the requirements of the Act or the Exchange
Act, as applicable, and the rules and regulations of the Commission
thereunder and will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter
through the Representative expressly for use in the Prospectus as
amended or supplemented;
(c) The Registration Statement and the Prospectus conform, and
any further amendments or supplements to the Registration Statement or
the Prospectus will conform, in all material respects to the
requirements of the Act and the rules and regulations of the Commission
thereunder and do not and will not, as of the applicable effective date
as to the Registration Statement and any amendment thereto and as of
the applicable filing date as to the Prospectus and any amendment or
supplement thereto, contain an untrue statement or a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter
through the Representative expressly for use in the Prospectus as
amended or supplemented;
(d) Neither the Company nor any of its subsidiaries
("subsidiaries", as used in this Agreement, shall include the Operating
Partnership and each other partnership which is together wholly-owned
by the Company and the Operating Partnership (each, a "Property
Partnership")), has sustained since the date of the latest audited
financial statements included or incorporated by reference in the
Prospectus any material loss or interference with its business from
fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth or contemplated in the
Prospectus; and, since the respective dates as of which information is
given in the Registration Statement and the Prospectus as amended or
supplemented, there has not been any change in the capital stock (other
than issuances pursuant to stock option plans) of the Company or the
short-term or long-term debt of the Company (other than reductions in
short-term or long-term debt pursuant to scheduled reductions in the
applicable debt instrument) or the capital stock or equity capital of
any of its subsidiaries or any material adverse change, or any
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development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position,
stockholders' equity (or, with respect to partnership subsidiaries,
partnership capital) or results of operations of the Company and its
subsidiaries, taken as a whole, otherwise than as set forth or
contemplated in the Prospectus;
(e) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of Delaware
with power and authority (corporate and other) to own its properties
and conduct its business as described in the Prospectus, and has been
duly qualified as a foreign corporation for the transaction of business
and is in good standing under the laws of each other jurisdiction in
which it owns or leases properties, or conducts any business, so as to
require such qualification, or is subject to no material liability or
disability by reason of the failure to be so qualified in any such
jurisdiction; and each material subsidiary of the Company has been duly
organized and is validly existing as a partnership or corporation, as
the case may be, in good standing (to the extent applicable) under the
laws of its jurisdiction of organization and has been duly qualified
for the transaction of business and is in good standing under the laws
of each other jurisdiction in which it owns or leases properties, or
conducts any business, so as to require such qualification, or is
subject to no material liability or disability by reason of the failure
to be so qualified in any such jurisdiction;
(f) The Company has an authorized capitalization as set forth
in the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued and are fully
paid and non-assessable. Except as disclosed in the Prospectus, no
shares of the Company's Common Stock are reserved for any purpose and
except for (i) the equity interests in the Operating Partnership
("Units"), (ii) shares of capital stock of GGP/Homart, Inc. and (iii) a
warrant issued to lenders to the Company and its affiliates there are
no outstanding securities convertible into or exchangeable for any
shares of Common Stock of the Company, and no outstanding options,
rights (preemptive or otherwise) or warrants to purchase or subscribe
for shares of Common Stock or any other securities of the Company
(except, in the case of options, any options granted on or after the
date on which the Company filed its definitive proxy statement on
Schedule 14A and a warrant issued to lenders to the Company and its
affiliates);
(g) The Shares have been duly and validly authorized and, when
issued and delivered pursuant to this Agreement, will be validly
issued, fully paid and non-assessable; will not be subject to the
preemptive rights or other similar rights of any stockholder of the
Company; all corporate action required to be taken for the
authorization, issue and sale of the Shares has been validly and
sufficiently taken; and the Shares will conform to the description
thereof contained in the Prospectus as amended or supplemented;
(h) The issue and sale of the Shares by the Company, the
compliance by the Company with all of the provisions of this Agreement
and the consummation of the transactions contemplated herein will not
conflict with or result in a breach or violation of
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5
any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which the Company or any subsidiary is a party or by
which the Company or any subsidiary is bound or to which any of the
property or assets of the Company or any subsidiary is subject, except
for a conflict, breach, violation, or default which would not have a
material adverse effect on (i) the Company's ability to perform its
obligations hereunder or (ii) the Company and its subsidiaries taken as
a whole, nor will such action result in any violation of the provisions
of the certificate of incorporation or bylaws of the Company or the
constituent documents of any subsidiary or any statute or any order,
rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of
their properties; and no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body is required for the issue and sale of the Shares or the
consummation by the Company of the transactions contemplated by this
Agreement, except such consents, approvals, authorizations,
registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of the Shares by the Underwriters;
(i) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property of the Company
or any of its subsidiaries is the subject, which might reasonably be
expected to individually or in the aggregate have a material adverse
effect on the current or future consolidated financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries taken as a whole; and, to the best of the Company's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(j) Neither the Company nor any of its subsidiaries is in
violation of its certificate of incorporation or certificate of limited
partnership, as the case may be, or bylaws or partnership agreement, as
the case may be, or in breach of or default in the performance or
observance of any material obligation, agreement, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement,
lease or other agreement or instrument or under any applicable law,
rule, order, administrative regulation or administrative or court
decree to which it is a party or by which it or any of its properties
may be bound, which breaches or defaults would not, in the aggregate,
have a material adverse effect on the general affairs, management,
financial position, stockholders equity or results of operations of the
Company and its subsidiaries taken as a whole;
(k) The statements set forth in the Prospectus (i) under the
captions "Description of Common Stock", insofar as they purport to
constitute a summary of the terms of the securities of the Company and
the provisions of the laws and documents referred to therein, and (ii)
under the caption "Federal Income Tax Considerations", insofar as they
purport to describe the provisions of the laws and documents referred
to therein, are accurate and complete;
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(l) Neither the Company, nor any of its subsidiaries, is, or
will be, after giving effect to the issue and sale of the Shares by the
Company, an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act
of 1940, as amended (the "Investment Company Act");
(m) PricewaterhouseCoopers LLP, who have certified certain
financial statements of the Company and its subsidiaries or affiliates,
are independent public accountants as required by the Act and the rules
and regulations of the Commission thereunder;
(n) The Company and its subsidiaries have good and marketable
title in fee simple to, or good and marketable leasehold estates in,
all real property described in the Prospectus as being owned by them,
and good and marketable title to all personal property owned by them
which is material to the business of the Company and its subsidiaries,
in each case free and clear of all liens, encumbrances and defects
except such as are described in the Prospectus or such as do not
materially affect the value of such property, and do not materially
interfere with the use made and proposed to be made of such property by
the Company and its subsidiaries; and any real property and buildings
held under lease by the Company and its subsidiaries are held by them
under valid and subsisting leases, in each case except as set forth or
contemplated in the Prospectus;
(o) The partnership agreement or shareholder agreement of each
subsidiary of the Company has been duly authorized, executed and
delivered by each party thereto and is valid, legally binding and
enforceable in accordance with its terms; all of the partnership
interests in each partnership subsidiary of the Company have been duly
and validly authorized and issued and (except as described in the
Prospectus and for a 50.0% interest in Dayjay Associates and except
with respect to the pledge of partnership interests in Ho Retail
Properties I Limited Partnership, Ho Retail Properties II Limited
Partnership and Parks at Arlington, L.P. (collectively, the "Pledged
Partnership Interests")) are owned directly or indirectly by the
Company or the Operating Partnership free and clear of all liens,
encumbrances, equities and claims; all of the stock of each corporate
subsidiary of the Company has been duly and validly authorized and
issued and (except as described in the Prospectus and except with
respect to the pledge of capital stock of GGP-Moreno Valley, Inc., GGP
General I and GGP General II (collectively, the "Pledged Capital
Stock")) is owned directly by the Company free and clear of all liens,
encumbrances, equities and claims;
(p) Application will be made to list the Shares on the New
York Stock Exchange ("NYSE");
(q) This Agreement has been duly and validly authorized,
executed and delivered by each of the Company and the Operating
Partnership and is a valid and legally binding agreement of each of the
Company and the Operating Partnership in accordance with its terms;
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(r) The financial statements (including the related notes and
supporting schedules) filed as part of, or incorporated by reference
in, the Registration Statement and the Prospectus present fairly the
financial condition and results of operations of the entities purported
to be shown thereby, at the dates and for the periods indicated, and
have been prepared in conformity with generally accepted accounting
principles applied on a consistent basis throughout the periods
involved. Pro forma financial information included in or incorporated
by reference in the Registration Statement and the Prospectus has been
prepared in accordance with applicable requirements of the Securities
Act, the Rules and Regulations and AICPA guidelines with respect to pro
forma financial information and includes all adjustments necessary to
present fairly the pro forma financial position of the Company at the
respective dates indicated and the results of operations for the
respective periods specified;
(s) Each of the Company and the Operating Partnership and
their subsidiaries, and each property carries, or is covered by,
insurance in such amounts and covering such risks as is adequate for
the conduct of its business and the value of such property and as is
customary for companies engaged in similar businesses in similar
industries;
(t) At all times commencing with the Company's taxable year
ending December 31, 1994, the Company and the Operating Partnership
have been and upon the sale of the Shares will continue to be,
organized and operated in conformity with the requirements for
qualification of the Company as a real estate investment trust under
the Internal Revenue Code of 1986, as amended (the "Code") and the
proposed method of operation of the Company and the Operating
Partnership will enable the Company to continue to meet the
requirements for qualification and taxation as a real estate investment
trust under the Code;
2. On the basis of the representations and warranties contained in, and
subject to the terms and conditions of, this Agreement, the Company agrees to
sell the Firm Shares to the several Underwriters and each of the Underwriters,
severally and not jointly, agrees to purchase the number of shares of the Firm
Shares set opposite that Underwriter's name in Schedule I hereto.
The Company hereby grants to the Underwriters the right (an
"Overallotment Option") to purchase at their election up to the number of
Optional Shares set forth in Schedule II hereto on the terms referred to herein
for the sole purpose of covering over-allotments in the sale of the Firm Shares.
Any such election to purchase Option Shares may be exercised by written notice
from the Representative to the Company given within a period of 30 calendar days
after the date of this Agreement, setting forth the aggregate number of Option
Shares to be purchased and the date on which such Option Shares are to be
delivered, as determined by the Representative, but in no event earlier than the
First Time of Delivery or, unless the Representative and the Company otherwise
agree in writing, no earlier than two or later than ten business days after the
date of such notice.
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The number of Option Shares to be added to the number of Firm
Shares to be purchased by each Underwriter as set forth in Schedule I hereto
shall be, in each case, the number of Option Shares which the Company has been
advised by the Representative have been attributed to such Underwriter; provided
that, if the Company has not been so advised, the number of Option Shares to be
so added shall be, in each case, that proportion of Option Shares which the
number of Firm Shares to be purchased by such Underwriter under this Agreement
bears to the aggregate number of Firm Shares (rounded as the Representative may
determine to the nearest 100 shares). The total number of Shares to be purchased
by all the Underwriters pursuant to this Agreement shall be the aggregate number
of Firm Shares set forth in Schedule I to this Agreement plus the aggregate
number of Option Shares which the Underwriters elect to purchase.
3. Upon the authorization by the Representative of the release of the
Firm Shares, the several Underwriters propose to offer the Firm Shares for sale
upon the terms and conditions set forth in the Prospectus as amended or
supplemented.
4. Certificates representing the Firm Shares and the Option Shares to
be purchased by each Underwriter pursuant to this Agreement, in the form
specified in Schedule II hereto and in such authorized denominations and
registered in such names as the Representative may request upon at least
forty-eight hours' prior notice to the Company, shall be delivered by or on
behalf of the Company to the Representative for the account of such Underwriter,
against payment by such Underwriter or on its behalf of the purchase price
therefor by certified or official bank check or checks or by transfer to an
account designated by the Company, payable to the order of the Company in funds
specified in Schedule II, (i) with respect to the Firm Shares, all in the manner
and at the place and time and date specified in Schedule II or at such other
place and time and date as the Representative and the Company may agree upon in
writing, such time and date being herein called the "First Time of Delivery" and
(ii) with respect to the Option Shares, if any, in the manner and at the time
and date specified by the Representative in the written notice given by the
Representative of the Underwriters' election to purchase such Option Shares, or
at such other time and date as the Representative and the Company may agree upon
in writing, such time and date, if not the First Time of Delivery, herein called
the "Second Time of Delivery". Each such time and date for delivery is herein
called a "Time of Delivery". For the purpose of expediting the checking and
packaging of the certificates for the Shares, the Company shall make the
certificates representing the Shares available for inspection by the
Representative in New York, New York, not later than 2:00 P.M., New York City
time, on the business day prior to each Time of Delivery.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus as amended and supplemented in a form
approved by the Representative and to file such Prospectus pursuant to Rule
424(b) under the Act not later than the Commission's close of business on the
second business day following the execution and delivery of this Agreement or,
if applicable, such earlier time as may be required by Rule 424(b); to make no
further amendment or any supplement to the Registration Statement or Prospectus
as amended or supplemented after the date of this Agreement and prior to any
Time of Delivery which shall be disapproved by the Representative promptly after
reasonable notice thereof; to advise the Representative promptly of any such
amendment or supplement after any Time of
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9
Delivery for such Shares and furnish the Representative with copies thereof; to
file promptly all reports and any definitive proxy or information statements
required to be filed by the Company with the Commission pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act for so long as the delivery of a
prospectus is required in connection with the offering or sale of the Shares,
and during such same period to advise the Representative, promptly after it
receives notice thereof, of the time when any amendment to the Registration
Statement has been filed or becomes effective or any supplement to the
Prospectus or any amended Prospectus has been filed with the Commission, of the
issuance by the Commission of any stop order or of any order preventing or
suspending the use of any prospectus relating to the Shares, of the suspension
of the qualification of such Shares for offering or sale in any jurisdiction, of
the initiation or threatening of any proceeding for any such purpose, or of any
request by the Commission for the amending or supplementing of the Registration
Statement or Prospectus or for additional information; and, in the event of the
issuance of any such stop order or of any such order preventing or suspending
the use of any prospectus relating to the Shares or suspending any such
qualification, promptly to use its best efforts to obtain the withdrawal of such
order;
(b) Promptly from time to time to take such action as the
Representative may reasonably request to qualify such Shares for offering and
sale under the securities laws of such jurisdictions as the Representative may
request and to comply with such laws so as to permit the continuance of sales
and dealings therein in such jurisdictions for as long as may be necessary to
complete the distribution of such Shares, provided that in connection therewith
the Company shall not be required to qualify as a foreign corporation or to file
a general consent to service of process in any jurisdiction;
(c) To furnish the Underwriters with copies of the Prospectus as
amended or supplemented in such quantities as the Representative may from time
to time reasonably request, and, if the delivery of a prospectus is required at
any time in connection with the offering or sale of the Shares and if at such
time any event shall have occurred as a result of which the Prospectus as then
amended or supplemented would include an untrue statement of a material fact or
omit to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made when such
Prospectus is delivered, not misleading, or, if for any other reason it shall be
necessary during such same period to amend or supplement the Prospectus or to
file under the Exchange Act any document incorporated by reference in the
Prospectus in order to comply with the Act or the Exchange Act, to notify the
Representative and upon their request to file such document and to prepare and
furnish without charge to each Underwriter and to any dealer in securities as
many copies as the Representative may from time to time reasonably request of an
amended Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance, and in case any Underwriter is
required to deliver a prospectus in connection with sales of any of the Shares
at any time nine months or more after the date hereof, upon the request of the
Representative but at the expense of such Underwriter, as many copies as the
Representative may from time to time reasonably request of an amended or
supplemented Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its security holders as soon as
practicable, but in any event not later than eighteen months after the effective
date of the Registration Statement (as
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defined in Rule 158(c) under the Act), an earnings statement of the Company and
its subsidiaries (which need not be audited) complying with Section 11(a) of the
Act and the rules and regulations of the Commission thereunder (including, at
the option of the Company, Rule 158);
(e) To use its best efforts to list, subject to notice of issuance, the
Shares on the NYSE;
(f) During the period beginning from the date of the Prospectus
Supplement and continuing to and including the date 30 days after the date of
the Prospectus Supplement, the Company will not offer, sell, contract to sell or
otherwise dispose of any securities of GGP which are substantially similar to
Common Stock or which are convertible or exchangeable into Common Stock or
securities which are substantially similar to common stock, without the prior
written consent of Lehman Brothers, except for (i) the Shares; (ii) any Common
Stock or securities convertible into or exercisable or exchangeable for Common
Stock issued by the Company in connection with acquisitions; (iii) shares issued
under employee stock option or stock purchase plans existing on the date of the
Prospectus Supplement; (iv) shares issued on the conversion or exchange of
convertible or exchangeable securities outstanding on the date of the Prospectus
Supplement; (v) shares that are contingently issuable as collateral for the
repayment of a loan and (vi) securities having substantially the same terms as
the Company's 7.25% Preferred Income Equity Redeemable Stock, Series A, par
value $100 per share (the "PIERS").
(g) Except as stated in this Agreement and in the Prospectus, neither
the Company nor the Operating Partnership has taken, nor will take, directly or
indirectly, any action designed to or that might reasonably be expected to cause
or result in stabilization or manipulation of the price of the Shares or the
Common Stock to facilitate the sale or resale of the Shares.
6. The Company covenants and agrees with the several Underwriters that
the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
any Agreement among Underwriters, this Agreement, any Blue Sky Memorandum,
closing documents (including compilations thereof) and any other documents in
connection with the offering, purchase, sale and delivery of the Shares; (iii)
all expenses in connection with the qualification of the Shares for offering and
sale under state securities laws as provided in Section 5(b) hereof, including
the reasonable fees and disbursements of counsel for the Underwriters in
connection with such qualification and in connection with the Blue Sky
survey(s); (iv) any filing fees incident to, and the fees and disbursements of
counsel for the Underwriters in connection with, any required reviews by the
National Association of Securities Dealers, Inc. of the terms of the sale of the
Shares; (v) the cost of preparing certificates for the Shares and Receipts; (vi)
the cost and charges of any transfer agent or registrar; (vii) listing fees of
the NYSE; (viii) fees payable to credit rating agencies; and (ix) all other
costs and expenses incident to the performance of its obligations hereunder
which are not otherwise
<PAGE> 12
11
specifically provided for in this Section. It is understood, however, that,
except as provided in this Section, and Sections 8 and 11 hereof, the
Underwriters will pay all of their own costs and expenses, including the fees of
their counsel, transfer taxes on resale of any of the Shares by them, and any
advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters shall be subject, in the
discretion of the Representative, to the condition that all representations and
warranties and other statements of the Company and the Operating Partnership in
this Agreement are, at and as of each Time of Delivery, true and correct, the
condition that the Company and the Operating Partnership shall have performed
all of their obligations hereunder theretofore to be performed, and the
following additional conditions:
(a) The Prospectus as amended or supplemented shall have been filed
with the Commission pursuant to Rule 424(b) within the applicable time period
prescribed for such filing by the rules and regulations under the Act and in
accordance with Section 5(a) hereof; no stop order suspending the effectiveness
of the Registration Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part of the
Commission shall have been complied with to the Representative's reasonable
satisfaction;
(b) The Underwriters shall have received from Simpson Thacher &
Bartlett, counsel for the Underwriters, such opinion or opinions, dated such
Time of Delivery, with respect to the issuance and sale of the Shares, the
Registration Statement, the Prospectus and other related matters as the
Underwriters may reasonably require, and the Company shall have furnished to
such counsel such documents as they reasonably request for the purpose of
enabling them to pass upon such matters;
(c) Sullivan & Cromwell, special counsel for the Company, shall have
furnished to the Representative their written opinion or opinions, dated each
Time of Delivery, in form and substance satisfactory to the Representative, to
the effect that:
(i) The Company has been duly incorporated and is an existing
corporation in good standing under the General Corporation Law of the
State of Delaware;
(ii) The Shares have been duly authorized and are validly
issued and fully paid and non-assessable;
(iii) This Agreement has been duly authorized, executed and
delivered by the Company;
(iv) The issuance of the Shares and the sale of the Shares by
the Company to you pursuant to this Agreement do not (i) violate the
Company's certificate of incorporation or by-laws, in each case as in
effect on the date hereof, or (ii) violate any existing Federal law of
the United States or existing law of the State of New York or the
<PAGE> 13
12
existing General Corporation Law of the State of Delaware; provided
that such counsel need not express any opinion with respect to Federal
or state securities laws;
(v) The Company is not an "investment company" as that term is
defined in the Investment Company Act of 1940; and
(vi) All regulatory consents, authorizations, approvals and
filings required to be obtained or made by the Company under the
Federal laws of the United States and the laws of the State of New York
for the issuance, sale and delivery of the Shares by the Company to you
have been obtained or made.
In addition, you shall have received from Sullivan & Cromwell a letter
stating that as special counsel to the Company, they reviewed the Registration
Statement, the prospectus contained therein (the "Basic Prospectus") and the
prospectus supplement, dated July 8, 1999 (the "Prospectus Supplement"),
participated in discussions with your representatives and those of the Company
and its accountants, and advised the Company as to the requirements of the Act
and the applicable rules and regulations thereunder; on the basis of the
information that such counsel gained in the course of the performance of such
services, considered in the light of their understanding of the applicable law
(including the requirements of Form S-3 and the character of the prospectus
contemplated thereby) and the experience they have gained through their practice
under the Act, they confirm to you that, in their opinion, each part of the
Registration Statement, when such part became effective, and the Basic
Prospectus, as supplemented by the Prospectus Supplement, as of the date of the
Prospectus Supplement, appeared on their face to be appropriately responsive, in
all material respects relevant to the offering of the Shares, to the
requirements of the Act and the applicable rules and regulations of the
Commission thereunder; nothing that came to such counsel's attention in the
course of such review has caused such counsel to believe, insofar as relevant to
the offering of the Shares, any part of the Registration Statement, when such
part became effective, contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or necessary to
make the statements therein not misleading or that, insofar as relevant to the
offering of the Shares, the Basic Prospectus, as supplemented by the Prospectus
Supplement, as of the date of the Prospectus Supplement and as of the date of
such letter, contained any untrue statement of a material fact or omitted to
state any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. Such counsel may state that the limitations inherent in the
independent verification of factual matters and the character of determinations
involved in the registration process are such that they do not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement, the Basic Prospectus or the Prospectus
Supplement except for those made under the captions "Description of Common
Stock" and "Plan of Distribution" in the Basic Prospectus, as supplemented by
the statements made under the captions "Description of Common Stock," and
"Underwriting" in the Prospectus Supplement, respectively, insofar as they
relate to provisions of the Company's Second Amended and Restated Certificate of
Incorporation, the Company's by-laws, the Company's Rights Agreement,
indemnification agreements with officers and directors of the Company and this
Agreement; and that such counsel do not express any opinion or belief as to the
financial statements or other
<PAGE> 14
13
financial data derived from accounting records contained in the Registration
Statement, the Basic Prospectus or the Prospectus Supplement.
(d) Neal, Gerber & Eisenberg, counsel for the Company, shall have
furnished to the Representative its written opinion or opinions, dated each Time
of Delivery, in form and substance satisfactory to the Representative, to the
effect that:
(i) The Company has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties, or conducts any business, so as to require such
qualification, or is subject to no material liability or disability by
reason of its failure to be so qualified in any such jurisdiction (such
counsel being entitled to rely in respect of the opinion in this clause
upon opinions of local counsel and in respect of matters of fact upon
certificates of officers of the Company, provided that such counsel
shall state that they believe that both you and they are justified in
relying upon such opinions and certificates);
(ii) Each subsidiary of the Company listed on Annex III has
been duly organized and is validly existing as a partnership, limited
liability company or corporation, as the case may be, in good standing
(to the extent applicable) under the laws of its jurisdiction of
incorporation or organization and, to the best of such counsel's
knowledge, each other subsidiary of the Company has been duly organized
or formed and is validly existing as a partnership, limited liability
company, trust or corporation, as the case may be, in good standing (to
the extent applicable) under the laws of its jurisdiction of
incorporation or organization or is subject to no material liability or
disability by reason of its failure to be so duly organized, formed or
validly existing in good standing in any such jurisdiction; the
partnership agreement or shareholder agreement of each subsidiary of
the Company has been duly authorized, executed and delivered by each
party thereto and is valid, legally binding and enforceable in
accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and
the effect of general principles of equity; all of the partnership
interests in each partnership subsidiary of the Company have been duly
and validly authorized and issued and (except as described in the
Prospectus) are owned directly or indirectly by the Company or the
Operating Partnership, free and clear of all liens, encumbrances,
equities and claims (except with respect to the pledge of the Pledged
Partnership Interests); all of the membership interests in each limited
liability company subsidiary of the Company have been duly and validly
authorized and issued and (except as described in the Prospectus) are
owned directly or indirectly by the Company or the Operating
Partnership, free and clear of all liens, encumbrances, equities and
claims; all of the stock of each corporate subsidiary of the Company
has been duly and validly authorized and issued and (except as
described in the Prospectus) is owned directly or indirectly by the
Company or the Operating Partnership, free and clear of all liens,
encumbrances, equities and claims (except with respect to the Pledged
Capital Stock) (Such counsel being entitled to rely in respect of the
opinion in this clause (ii) upon opinions of local counsel and in
respect of matters of fact upon certificates of officers of
<PAGE> 15
14
the Company or its subsidiaries, provided that such counsel shall state
that they believe both you and they are justified in relying upon such
opinions and certificates);
(iii) All of the issued shares of capital stock of the Company
(provided that no opinion is being delivered hereunder for Shares being
delivered at each Time of Delivery) have been duly and validly
authorized and issued and are fully paid and non-assessable;
(iv) To the best of such counsel's knowledge and other than as
set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries is
a party or of which any property of the Company or any of its
subsidiaries is the subject which, if determined adversely to the
Company or any of its subsidiaries, would individually or in the
aggregate have a material adverse effect on the current or future
consolidated financial position, stockholders' equity or results of
operations of the Company and its subsidiaries taken as a whole; and to
the best of such counsel's knowledge, no such proceedings are
threatened or contemplated by governmental authorities or threatened by
others;
(v) The issue and sale of the Shares being delivered at such
Time of Delivery, and the compliance by the Company and the Operating
Partnership with all of the provisions of this Agreement and the
consummation of the transactions herein will not conflict with or
result in a breach or violation of any of the terms or provisions of,
or constitute a default under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument known to such counsel
to which the Company or the Operating Partnership is a party or by
which the Company or the Operating Partnership is bound or to which any
of the property or assets of the Company, the Operating Partnership or
any Property Partnership is subject, nor will such action result in any
violation of the provisions of the certificate of incorporation or
bylaws of the Company or the certificate of limited partnership or
partnership agreement of the Operating Partnership or any statute or
any order, rule or regulation known to such counsel of any court or
governmental agency or body having jurisdiction over the Company or the
Operating Partnership or any of their properties;
(vi) The Shares are free of any preemptive or other similar
rights created by the Company's Second Amended and Restated Certificate
of Incorporation, as amended, and, to our knowledge, are free of any
preemptive or other similar rights created pursuant to any agreement
entered into by the Company;
(vii) Neither the Company nor, to our knowledge, any of its
subsidiaries, is in violation of its certificate of incorporation,
certificate of limited partnership or operating agreement, as the case
may be, or bylaws or partnership agreement, as the case may be, or in
default in the performance or observance of any material obligation,
agreement, covenant or condition contained in any indenture, mortgage,
deed of trust, loan agreement, lease or other agreement or instrument
known to us to which it is a party or by which it or any of its
properties may be bound;
<PAGE> 16
15
(viii) The partnership agreement of the Operating Partnership
has been duly authorized, executed and delivered by the Company and is
the valid and legally binding obligation of, and is enforceable
against, the Company, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and the effect
of general principles of equity; and the partnership agreement of each
Property Partnership has been duly authorized, executed and delivered
by the Company in its corporate capacity or by the Company or a
subsidiary of the Company in its capacity as general partner of the
Operating Partnership or the Property Partnerships;
(ix) Each partnership in which the Company owns an interest in
excess of 10 percent is properly treated (x) as a partnership for
federal income tax purposes and (y) not as a "publicly traded
partnership" as defined in the Code;
(x) The statements set forth in the Prospectus under the
caption "Federal Income Tax Considerations" insofar as they purport to
describe the provisions of the laws, legal conclusions with respect
thereto and documents referred to therein, are accurate and complete in
all material respects; and
(xi) In the opinion of such counsel, commencing with the
Company's taxable year ending December 31, 1993, the Company has been
organized in conformity with the requirements for qualification as a
REIT, and its historic and proposed methods of operation have enabled
and will enable it to meet the requirements for qualification and
taxation as a REIT under the Code and the right, in certain
circumstances, of holders of interests in the Operating Partnership to
exchange those interests for shares of Common Stock has not caused and
will not cause the Company to fail the diversity test of Section
856(a)(6) of the Code.
(e) At each Time of Delivery, PricewaterhouseCoopers LLP, who have
certified certain financial statements of the Company and its subsidiaries
included or incorporated by reference in the Registration Statement, shall have
furnished to the Representative a letter, dated the date of this Agreement, and
a letter dated such Time of Delivery, to the effect set forth in Annex I hereto
and as to such other matters as the Representative may reasonably request and in
form and substance satisfactory to the Representative;
(f) Deloitte & Touche, LLP, who have certified certain of the combined
statements of revenues and certain expenses of Ala Moana Center (the "Mall"),
included in the Registration Statement, shall have furnished to the
Representative a letter, dated the First Time of Delivery, to the effect set
forth in Annex II hereto and as to such other matters as the Representative may
reasonably request and in form and substance satisfactory to the Representative;
(g) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus as amended prior to the date of this
Agreement relating to the Shares any loss or interference with its business from
fire, explosion, flood or other calamity, whether or not covered
<PAGE> 17
16
by insurance, or from any labor dispute or court or governmental action, order
or decree, otherwise than as set forth or contemplated in the Prospectus as
amended prior to the date of this Agreement, and (ii) since the respective dates
as of which information is given in the Prospectus as amended prior to the date
of this Agreement there shall not have been any change in the capital stock
(other than issuances pursuant to stock option plans) or long-term or short-term
debt of the Company or any of its subsidiaries (other than reductions in
short-term or long-term debt pursuant to scheduled reductions in the applicable
debt instrument) or any change, or any development involving a prospective
change, in or affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the Prospectus as
amended prior to the date of this Agreement, the effect of which, in any such
case described in clauses (i) or (ii), is in the judgment of the Representative
so material and adverse as to make it impracticable or inadvisable to proceed
with the public offering or the delivery of the Shares on the terms and in the
manner contemplated in the Prospectus as first amended or supplemented;
(h) On or after the date of this Agreement (i) no downgrading shall
have occurred in the rating accorded the Company's debt securities or preferred
stock by any "nationally recognized statistical rating organization", as that
term is defined by the Commission for purposes of Rule 436(g)(2) under the Act,
and (ii) no such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of any
of the Company's debt securities or preferred stock;
(i) On or after the date of this Agreement there shall not have
occurred any of the following: (i) a suspension or material limitation in
trading in securities generally on the NYSE; (ii) a suspension or material
limitation in trading in the Company's securities on the NYSE; (iii) a general
moratorium on commercial banking activities declared by either Federal or New
York State authorities; and (iv) the outbreak or escalation of hostilities
involving the United States or the declaration by the United States of a
national emergency or war, if the effect of any such event specified in this
Clause (iv) in the judgment of the Representative made it impracticable or
inadvisable to proceed with the public offering or the delivery of the Firm
Shares or Option Shares or both on the terms and in the manner contemplated in
the Prospectus as first amended or supplemented;
(j) The Shares at each Time of Delivery shall have been duly listed,
subject to notice of issuance, on the NYSE; and
(k) The Company shall have furnished or caused to be furnished to the
Representative at such Time of Delivery certificates of officers of the Company
satisfactory to the Representative as to the accuracy of the representations and
warranties of the Company herein at and as of such Time of Delivery, as to the
performance by the Company of all of its obligations hereunder to be performed
at or prior to such Time of Delivery, as to the matters set forth in subsections
(a) and (g) of this Section 7 and as to such other matters as Representative may
reasonably request.
8. (a) The Company and the Operating Partnership, jointly and
severally, shall indemnify and hold harmless each Underwriter, its officers and
employees and each person, if any,
<PAGE> 18
17
who controls any Underwriter within the meaning of the Securities Act, from and
against any loss, claim, damage, or liability, joint or several, or any action
in respect thereof (including, but not limited to, any loss, claim, damage,
liability or action relating to purchases and sales of Shares), to which that
Underwriter, officer, employee or controlling person may become subject, under
the Securities Act or otherwise, insofar as such loss, claim, damage, liability
or action arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement or
the Prospectus or in any amendment or supplement thereto (with respect to the
Prospectus, in light of the circumstances under which they were made), (ii) the
omission or alleged omission to state in the Registration Statement or the
Prospectus, or in any amendment or supplement thereto, any material fact
required to be stated therein or necessary to make the statements therein not
misleading (with respect to the Prospectus, in light of the circumstances under
which they were made), or (iii) any act or failure to act or any alleged act or
failure to act by any Underwriter in connection with, or relating in any manner
to, the Shares or the offering contemplated hereby, and which is included as
part of or referred to in any loss, claim, damage, liability or action arising
out of or based upon matters covered by clause (i) or (ii) above (provided that
neither the Company nor the Operating Partnership shall be liable under this
clause (iii) to the extent that it is determined in a final judgment by a court
of competent jurisdiction that such loss, claim, damage, liability or action
resulted directly from any such acts or failures to act undertaken or omitted to
be taken by such Underwriter through its gross negligence or willful
misconduct), and shall reimburse each Underwriter and each such officer,
employee or controlling person for any legal or other expenses reasonably
incurred by that Underwriter, officer, employee or controlling person in
connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that neither the Company nor the Operating Partnership shall
be liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, any untrue statement or
alleged untrue statement or omission or alleged omission made in the
Registration Statement or the Prospectus, or in any such amendment or
supplement, in reliance upon and in conformity with written information
concerning such Underwriter furnished to the Company through the Underwriters by
or on behalf of any Underwriter specifically for inclusion therein. The
foregoing indemnity agreement is in addition to any liability which the Company
and the Operating Partnership may otherwise have to any Underwriter or to any
officer, employee or controlling person of that Underwriter.
(b) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless each of the Company and the Operating Partnership, its officers
and employees, each of its directors, and each person, if any, who controls the
Company or the Operating Partnership within the meaning of the Securities Act,
from and against any loss, claim, damage or liability, joint or several, or any
action in respect thereof, to which each of the Company or the Operating
Partnership or any such director, officer or controlling person may become
subject, under the Securities Act or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon, (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or the Prospectus or in any amendment or supplement
thereto, or (ii) the omission or alleged omission to state in the Registration
Statement or the Prospectus, or in any amendment or supplement thereto, any
material fact required to be stated therein or necessary to make the statements
therein not misleading, but in each case only to the extent that the untrue
<PAGE> 19
18
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information concerning such
Underwriter furnished to the Company through the Underwriters by or on behalf of
that Underwriter specifically for inclusion therein, and shall reimburse the
Company or the Operating Partnership and any such director, officer or
controlling person for any legal or other expenses reasonably incurred by the
Company or the Operating Partnership or any such director, officer or
controlling person in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred. The foregoing indemnity agreement is in addition to any
liability which any Underwriter may otherwise have to the Company, the Operating
Partnership or any such director, officer, employee or controlling person.
(c) Promptly after receipt by an indemnified party under this Section 8
of notice of any claim or the commencement of any action, the indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under this Section 8, notify the indemnifying party in writing of the
claim or the commencement of that action; provided, however, that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have under this Section 8 except to the extent it has been materially
prejudiced by such failure and, provided further, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have to
an indemnified party otherwise than under this Section 8. If any such claim or
action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
the indemnified party shall have the right to employ its own counsel, with such
counsel, in the case of the Underwriters, to represent jointly the Underwriters
and their respective officers, employees and controlling persons who may be
subject to liability arising out of any claim in respect of which indemnity may
be sought by the Underwriters against the Company or the Operating Partnership
under this Section 8 if, in the reasonable judgment of the Underwriters, it is
advisable for the Underwriters and those officers, employees and controlling
persons to be jointly represented by separate counsel, and in that event the
fees and expenses of such separate counsel shall be paid by the Company and the
Operating Partnership. No indemnifying party shall (i) without the prior written
consent of the indemnified parties (which consent shall not be unreasonably
withheld), settle or compromise or consent to the entry of any judgment with
respect to any pending or threatened claim, action, suit or proceeding in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising out
of such claim, action, suit or proceeding, or (ii) be liable for any settlement
of any such action effected without its written consent (which consent shall not
be unreasonably withheld), but if settled with the consent of the indemnifying
party or if there be a final judgment of the plaintiff in any such action, the
indemnifying party
<PAGE> 20
19
agrees to indemnify and hold harmless any indemnified party from and against any
loss or liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 8 shall for any
reason be unavailable to or insufficient to hold harmless an indemnified party
under Section 8(a) or 8(b) in respect of any loss, claim, damage or liability,
or any action in respect thereof, referred to therein, then each indemnifying
party shall, in lieu of indemnifying such indemnified party, contribute to the
amount paid or payable by such indemnified party as a result of such loss,
claim, damage or liability, or action in respect thereof, (i) in such proportion
as shall be appropriate to reflect the relative benefits received by the Company
and the Operating Partnership on the one hand and the Underwriters on the other
from the offering of the Shares or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company and the Operating Partnership on the one
hand and the Underwriters on the other with respect to the statements or
omission which resulted in such loss, claim, damage or liability, or action in
respect thereof, as well as any other relevant equitable considerations. The
relative benefits received by the Company and the Operating Partnership on the
one hand and the Underwriters on the other with respect to such offering shall
be deemed to be in the same proportion as the total net proceeds from the
offering of the Shares purchased under this Agreement (before deducting
expenses) received by the Company or the Operating Partnership, on the one hand,
and the total underwriting discounts and commissions received by the
Underwriters with respect to the Shares purchased under this Agreement, on the
other hand, bear to the total gross proceeds from the offering of the Shares
under this Agreement. The relative fault shall be determined by reference to
whether the untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to information supplied by the
Company or the Operating Partnership or the Underwriters, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company, the Operating
Partnership and the Underwriters agree that it would not be just and equitable
if contributions pursuant to this Section were to be determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take into account
the equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Section shall be deemed to
include, for purposes of this Section 8(d), any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Section 8(d), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Shares underwritten
by it and distributed to the public was offered to the public exceeds the amount
of any damages which such Underwriter has otherwise paid or become liable to pay
by reason of any untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute as provided in this Section 8(d) are
several in proportion to their respective underwriting obligations and not
joint.
<PAGE> 21
20
(e) The Underwriters severally confirm and the Company and the
Operating Partnership each acknowledge that the statements with respect to the
public offering of the Shares by the Underwriters set forth on the cover page of
and, pursuant to Item 508 of Regulation S-K of the Act, the third and seventh
paragraphs appearing in the section captioned "Underwriting" in, the Prospectus
are correct and constitute the only information concerning such Underwriters
furnished in writing to the Company by or on behalf of the Underwriters
specifically for inclusion in the Registration Statement and the Prospectus.
9. (a) If any Underwriter shall default in its obligation to purchase
the Firm Shares or Option Shares which it has agreed to purchase under this
Agreement, the Representative may in its discretion arrange for themselves or
another party or other parties to purchase such Shares on the terms contained
herein. If within thirty-six hours after such default by any Underwriter the
Representative does not arrange for the purchase of such Firm Shares or Option
Shares, as the case may be, then the Company shall be entitled to a further
period of thirty-six hours within which to procure another party or other
parties reasonably satisfactory to the Representative to purchase such Shares on
such terms. In the event that, within the respective prescribed period, the
Representative notifies the Company that it has so arranged for the purchase of
such Shares, or the Company notifies the Representative that it has so arranged
for the purchase of such Shares, the Representative or the Company shall have
the right to postpone a Time of Delivery for such Shares for a period of not
more than seven days, in order to effect whatever changes may thereby be made
necessary in the Registration Statement or the Prospectus as amended or
supplemented, or in any other documents or arrangements, and the Company agrees
to file promptly any amendments or supplements to the Registration Statement or
the Prospectus which in the opinion of the Representative may thereby be made
necessary. The term "Underwriter" as used in this Agreement shall include any
person substituted under this Section with like effect as if such person had
originally been a party to this Agreement.
(b) If, after giving effect to any arrangements for the purchase of the
Firm Shares or Option Shares, as the case may be, of a defaulting Underwriter or
Underwriters by the Representative and the Company as provided in subsection (a)
above, the aggregate number of such Shares which remains unpurchased does not
exceed one-eleventh of the aggregate number of the Firm Shares or Option Shares,
as the case may be, to be purchased at the respective Time of Delivery, then the
Company shall have the right to require each non-defaulting Underwriter to
purchase the number of Firm Shares or Option Shares, as the case may be, which
such Underwriter agreed to purchase under this Agreement and, in addition, to
require each non-defaulting Underwriter to purchase its pro rata share (based on
the number of Firm Shares or Option Shares, as the case may be, which such
Underwriter agreed to purchase under this Agreement) of the Firm Shares or
Option Shares, as the case may be, of such defaulting Underwriter or
Underwriters for which such arrangements have not been made; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Firm Shares or Option Shares, as the case may be, of a defaulting Underwriter or
Underwriters by the Representative and the Company as provided in subsection (a)
above, the aggregate number of Firm Shares or Option Shares, as the case may be,
which remains unpurchased exceeds one-
<PAGE> 22
21
eleventh of the aggregate number of the Firm Shares or Option Shares, as the
case may be, to be purchased at the respective Time of Delivery, as referred to
in subsection (b) above, or if the Company shall not exercise the right
described in subsection (b) above to require non-defaulting Underwriters to
purchase Firm Shares or Option Shares, as the case may be, of a defaulting
Underwriter or Underwriters, then this Agreement shall thereupon terminate,
without liability on the part of any non-defaulting Underwriter or the Company,
except for the expenses to be borne by the Company and the Underwriters as
provided in Section 6 hereof and the indemnity and contribution agreements in
Section 8 hereof; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Operating Partnership and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and effect,
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of any Underwriter or any controlling person of any
Underwriter, or the Company or the Operating Partnership, or any officer or
director or controlling person of the Company or the Operating Partnership, and
shall survive delivery of and payment for the Shares.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
or if any Shares are not delivered by the Company as provided herein because the
condition set forth in Section 7(j) hereof has not been met, the Company shall
not then be under any liability to any Underwriter except as provided in
Sections 6 and 8 hereof; but, if for any other reason, Shares are not delivered
by or on behalf of the Company as provided herein, the Company will reimburse
the Underwriters through the Representative for all out-of-pocket expenses
approved in writing by the Representative, including fees and disbursements of
counsel, reasonably incurred by the Underwriters in making preparations for the
purchase, sale and delivery of such Shares, but neither the Company nor the
Operating Partnership shall then be under any further liability to any
Underwriter with respect to such Shares except as provided in Sections 6 and 8
hereof.
12. In all dealings hereunder, the Representative of the Underwriters
of Shares shall act on behalf of each of such Underwriters, and the parties
hereto shall be entitled to act any rely upon any statement, request, notice or
agreement on behalf of any Underwriter made or given by such Representative.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Representative as set forth in
Schedule II hereto; and if to the Company or the Operating Partnership shall be
delivered or sent by mail, telex or facsimile transmission to the address of the
Company set forth in the Registration Statement, Attention: Secretary; provided,
however, that any notice to an Underwriter pursuant to Section 8(c) hereof shall
be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its Underwriters' Questionnaire, or
telex constituting such Questionnaire, which address will be supplied to the
Company by the Representative upon request. Any such statements, requests,
notices or agreements shall take effect upon receipt thereof.
<PAGE> 23
22
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company, the Operating Partnership and, to the
extent provided in Sections 8 and 10 hereof, the officers and directors of the
Company and the Operating Partnership and each person who controls the Company,
the Operating Partnership or any Underwriter, and their respective heirs,
executors, administrators, successors and assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement. No purchaser of
any of the Shares from any Underwriter shall be deemed a successor or assign by
reason merely of such purchase.
14. Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement may be executed by any one or more of the parties
hereto and thereto in any number of counterparts, each of which shall be deemed
to be an original, but all such respective counterparts shall together
constitute one and the same instrument.
If the foregoing is in accordance with your understanding, please sign
and return to us (one for the Company and one for the Representative plus one
for each counsel) counterparts hereof.
<PAGE> 24
23
Very truly yours,
GENERAL GROWTH PROPERTIES, INC.
By: /s/ Bernard Freibaum
--------------------------------------
Name: Bernard Freibaum
Title: Executive Vice President/Chief
Financial Officer
GGP LIMITED PARTNERSHIP
By: /s/ Bernard Freibaum
--------------------------------------
Name: Bernard Freibaum
Title: Executive Vice President/Chief
Financial Officer
Accepted as of the date hereof:
LEHMAN BROTHERS INC.
For itself and as Representative
of the several Underwriters named
in Schedule I hereto
By: LEHMAN BROTHERS INC.
By: /s/ Michael DeMarco
--------------------------------------
Authorized Representative
<PAGE> 25
SCHEDULE I
<TABLE>
<CAPTION>
NUMBER OF
FIRM SHARES
TO BE PURCHASED
---------------
<S> <C>
UNDERWRITERS
LEHMAN BROTHERS INC............................................................. 10,000,000
TOTAL ..................................................................... 10,000,000
==========
</TABLE>
<PAGE> 26
SCHEDULE II
NUMBER OF SHARES:
Number of Firm Shares: 10,000,000
Maximum Number of Option Shares: 1,000,000
INITIAL OFFERING PRICE TO PUBLIC:
Lehman Brothers proposes to offer the Shares from time to time for sale in
one or more transactions on the New York Stock Exchange, in the
over-the-counter market or otherwise, at market prices prevailing at the
time of sale, at prices related to prevailing market prices, or at
negotiated prices, subject to prior sale when, as and if delivered to and
accepted by Lehman Brothers.
PURCHASE PRICE BY UNDERWRITERS:
$33.2225 per Share
LISTING:
New York Stock Exchange
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
Wire transfer of immediately available funds
TIME OF DELIVERY:
10.00 a.m. (New York City time), July 14, 1998
CLOSING LOCATION:
Sullivan & Cromwell, 125 Broad Street, New York, New York 10004
NAMES AND ADDRESSES OF REPRESENTATIVE:
Lehman Brothers Inc.
c/o Lehman Brothers Inc.
Three World Financial Center
New York, New York 10285
<PAGE> 27
2
Address for Notices, etc.: Three World Financial Center, New York,
New York 10285, Attention: Syndicate Department
(Fax: 212-528-8822)
<PAGE> 28
ANNEX I
Pursuant to Section 7(e) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with
respect to the Company and its subsidiaries within the meaning of the
Act and the applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules (and, if applicable,
financial forecasts and/or pro forma financial information) examined by
them and included or incorporated by reference in the Registration
Statement or the Prospectus comply as to form in all material respects
with the applicable accounting requirements of the Act or the Exchange
Act, as applicable, and the related published rules and regulations
thereunder; and, if applicable, they have made a review in accordance
with standards established by the American Institute of Certified
Public Accountants of the unaudited consolidated interim financial
statements, selected financial data, pro forma financial information,
financial forecasts and/or condensed financial statements derived from
audited financial statements of the Company for the periods specified
in such letter, as indicated in their reports thereon;
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants
of the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus and/or included in the Company's quarterly
reports on Form 10-Q incorporated by reference into the Prospectus; and
on the basis of specified procedures including inquiries of officials
of the Company who have responsibility for financial and accounting
matters regarding whether the unaudited condensed consolidated
financial statements referred to in paragraph (iv)(A)(i) below comply
as to form in all material respects with the applicable accounting
requirements of the Act and the Exchange Act and the related published
rules and regulations, nothing came to their attention that caused them
to believe that the unaudited condensed consolidated financial
statements do not comply as to form in all material respects with the
applicable accounting requirements of the Act and the Exchange Act and
the related published rules and regulations;
(iv) On the basis of limited procedures, not constituting an
audit in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available
interim financial statements of the Company and its subsidiaries,
inspection of the minute books of the Company and its subsidiaries
since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus, inquiries of officials of
the Company and its subsidiaries responsible for financial and
accounting matters and such other inquiries and procedures as may be
specified in such letter, nothing came to their attention that caused
them to believe that:
<PAGE> 29
2
(A) (i) the unaudited condensed consolidated
statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the
Prospectus and/or included or incorporated by reference in the
Company's Quarterly Reports on Form 10-Q incorporated by
reference in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements
of the Exchange Act and the related published rules and
regulations, or (ii) any material modifications should be made
to the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus or included in the
Company's Quarterly Reports on Form 10-Q incorporated by
reference in the Prospectus, for them to be in conformity with
generally accepted accounting principles:
(B) any unaudited pro forma consolidated condensed
financial statements included or incorporated by reference in
the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the
Act and the published rules and regulations thereunder or the
pro forma adjustments have not been properly applied to the
historical amounts in the compilation of those statements;
(C) as of a specified date not more than five days
prior to the date of such letter, there have been any changes
in the consolidated stock (other than issuances of capital
stock upon exercise of options and stock appreciation rights,
upon earn-outs of performance shares and upon conversions of
convertible securities, in each case which were outstanding on
the date of the latest balance sheet included or incorporated
by reference in the Prospectus) or any increase in the
consolidated long-term debt of the Company and its
subsidiaries, or any decreases in consolidated net current
assets or stockholders' equity or other items specified by the
Representative, or any increases or decreases in inventories
or other items specified by the Representative, in each case
as compared with amounts shown in the latest balance sheet
included or incorporated by reference in the Prospectus,
except in each case for changes, increases or decreases which
the Prospectus discloses have occurred or may occur or which
are described in such letter; and
(D) for the period from the date of the latest
financial statements included or incorporated by reference in
the Prospectus to the specified date referred to in Clause (C)
there were any decreases in consolidated net revenues or
operating profit or the total or per share amounts of
consolidated net income or other items specified by the
Representative, or any increases in any items specified by the
Representative, in each case as compared with the comparable
period of the preceding year and with any other period of
corresponding length specified by the Representative, except
in each case for increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in
such letter; and
(v) In addition to the examination referred to in their
report(s) included or incorporated by reference in the Prospectus and
the limited procedures, inspection of minute books, inquiries and other
procedures referred to in paragraphs (iii) and (iv) above, they have
<PAGE> 30
3
carried out certain specified procedures, not constituting an
examination in accordance with generally accepted auditing standards,
with respect to certain amounts, percentages and financial information
specified by the Representative which are derived from the general
accounting records of the Company and its subsidiaries, which appear in
the Prospectus (excluding documents incorporated by reference), or in
Part II of, or in exhibits and schedules to, the Registration Statement
specified by the Representative or in documents incorporated by
reference in the Prospectus specified by the Representative, and have
compared certain of such amounts, percentages and financial information
with the accounting records of the Company and its subsidiaries and
have found them to be in agreement.
All references in this Annex I to the Prospectus shall be
deemed to refer to the Prospectus as amended or supplemented (including
the documents incorporated by reference therein) for purposes of each
letter delivered.
<PAGE> 31
ANNEX II
Pursuant to Section 7(f) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with
respect to the prior owner of the properties within the meaning of the
Act and the applicable published rules and regulations thereunder;
(ii) In their opinion, the combined statement of revenues and
certain expenses audited by them and included in the registration
statement complies as to form in all material respects with the
applicable accounting requirements of the Act and the related rules and
regulations adopted thereunder;
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants
of the unaudited combined statements of revenues and certain expenses
for the three-month period ended March 31, 1999 included in the
Prospectus; and on the basis of specified procedures including
inquiries of officials who have responsibility for financial and
accounting matters regarding whether the unaudited combined statements
of revenues and certain expenses for the three-month period ended March
31, 1999 comply as to form in all material respects with the applicable
accounting requirements of the Act and the Exchange Act and the related
published rules and regulations, nothing came to their attention that
caused them to believe that the unaudited combined statements of
revenues and certain expenses for the three-month period ended March
31, 1999 do not comply as to form in all material respects with the
applicable accounting requirements of the Act and the Exchange Act and
the related published rules and regulations.
<PAGE> 32
2
ANNEX III
GGP Limited Partnership
General Growth Finance SPE, Inc.
GGP Holding, Inc.
GGP Ivanhoe, Inc.
GGP Ivanhoe II, Inc.
GGP Ivanhoe III, Inc.
GGP/Homart, Inc.
General Growth Management, Inc.
<PAGE> 1
Exhibit 8.1
<PAGE> 2
Exhibit 8.1
NEAL, GERBER & EISENBERG
Two N. LaSalle - Suite 2200
Chicago, Illinois 60602
July 14, 1999
General Growth Properties, Inc.
110 North Wacker
Chicago, Illinois 60606
Ladies and Gentlemen:
We are rendering the opinion contained herein with respect to General
Growth Properties, Inc., a Delaware corporation (the "Company"). In so acting
and in rendering the opinions expressed below, we have examined and relied upon
the originals, or copies certified or otherwise identified to our satisfaction
of such records, documents, agreements and instruments as we have deemed
necessary to the rendering of these opinions including, without limitation, the
representations (the "Representations") made by the Company and by certain
entities all in which the Company holds direct or indirect interests in, dated
July 13, 1999.
Based upon and subject to the Representations and the assumptions noted
below, we are of the opinion that as of the date hereof, (i) each partnership in
which the Company owns an interest in excess of 10 percent is properly treated
(x) as a partnership for federal income tax purposes and (y) not as a "publicly
traded partnership" as defined in the Internal Revenue Code of 1986, as amended
(the "Code"); (ii) the statements set forth in the Prospectus Supplement under
the caption "Federal Income Tax Considerations" insofar as they purport to
describe the provisions of federal tax laws, legal conclusions with respect
thereto and documents referred to therein, are accurate and complete in all
material respects and (iii) commencing with the Company's taxable year ending
December 31, 1993, the Company has been organized in conformity with the
requirements for qualification as a real estate investment trust ("REIT"), and
its historic and proposed methods of operation have enabled and will enable it
to meet the requirements for qualification and taxation as a REIT under the Code
and the right, in certain circumstances, of holders of interests in GGP Limited
Partnership, a Delaware limited partnership, to exchange those interests for
shares of Common Stock has not caused and will not cause the Company to fail the
diversity test of Section 856(a)(6) of the Code.
<PAGE> 3
Lehman Brothers Inc.
July 14, 1999
Page 2
The opinion expressed herein is subject to the qualification and
assumption that all documents submitted to us as originals and the originals of
all documents submitted to us as certified or photostatic copies are authentic,
all documents submitted to us as certified or photostatic copies conform to the
original documents and all signatures are genuine.
The opinion herein is given as of the date hereof, is based upon the
Code, regulations of the Department of the Treasury (the "Treasury
Regulations"), published rulings and procedures of the Internal Revenue Service,
and judicial decisions, all as in effect on the date hereof. The opinion is
limited to the matters expressly set forth herein and no opinions are to be
implied or may be inferred beyond the matters expressly so stated. We disclaim
any obligation to update this letter for events, whether legal or factual,
occurring after the date hereof.
We hereby consent to the filing of this opinion as Exhibit 8.1 to the
Company's Current Report on Form 8-K dated July 14, 1999 and to the reference to
our firm under the captions "Federal Income Tax Considerations" and "Validity of
Common Stock" in the Prospectus Supplement.
Without our prior written consent, this opinion may not be used or
relied upon by any other person other than the addressee.
We note that Marshall E. Eisenberg, a partner of our firm, is the
Secretary of the Company and certain of its affiliates and that certain partners
of our firm and attorneys associated with our firm and members of their
respective families and/or trusts for their benefit are stockholders of or are
beneficial owners of equity securities of the Company or are trustees (or
officers, directors or stockholders of trustees) of the Company or its
affiliates.
Very truly yours,
/s/ NEAL, GERBER & EISENBERG
