<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 30, 1998
WESTFIELD AMERICA, INC.
-----------------------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
MISSOURI 1-12923 43-0758627
- ------------------------------ ------- ----------
(State or Other Jurisdiction Commission file number (IRS EMPLOYER IDENTIFICATION
of incorporation) NUMBER)
</TABLE>
11601 WILSHIRE BOULEVARD
12TH FLOOR
LOS ANGELES, CALIFORNIA 90025
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
---------------------------------------------------------
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 310/445-2427
NO CHANGE
- --------------------------------------------------------------------------------
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
<PAGE>
ITEM 2. Acquisition or Disposition of Assets.
------------------------------------
On November 2, 1998, Westfield America, Inc. (the "Company") announced its
acquisition, on October 30, 1998, of a 100% interest in each of Downtown Plaza
located in Sacramento, California and Horton Plaza located in San Diego,
California and a 55% interest in North Country Fair located in Escondido,
California giving the Company a 100% interest in North County Fair. The
acquisitions were made pursuant to an Asset Purchase Agreement, dated as of
April 6, 1998, between TrizecHahn Centers, Inc. ("TrizecHahn") and The Rouse
Company and the Company, as amended by Amendment No. 1 dated as of July 31,
1998, by Amendment No. 2 dated as of August 31, 1998, by Amendment No. 3 dated
as of September 23, 1998, by Amendment No. 4 dated as of September 25, 1998,
by Amendment No. 5 dated as of October 7, 1998, by Amendment No. 6 dated as of
October 22, 1998 and by Amendment No. 7 dated as of October 30, 1998.
The acquisitions were made through separate limited liability companies
wholly-owned by Westfield America Limited Partnership, the operating partnership
through which the Company conducts substantially all of its business. The
Company paid a total consideration of approximately $454 million for the
acquisitions to affiliates of TrizecHahn, including the assumption of
approximately $120 million of mortgage indebtedness. The amount of consideration
was determined by arm's length negotiations. The funds for these acquisitions
came from borrowings under the Company's secured loan facility with the Capital
Company of America LLC and borrowings under a bridge financing provided by a
consortium of banks led by Union Bank of Switzerland.
Downtown Plaza is a super regional shopping center with 1,166,000
square feet of gross leasable area. It has 155 specialty stores and two Macy's
stores as anchors.
Horton Plaza is a super regional shopping center with 800,000 square
feet of gross leasable area. It has 140 specialty stores and three anchors:
Nordstrom, Macy's and Mervyn's.
North County Fair is a super regional shopping center with 1,260,000 square
feet of gross leasable area. It has 168 specialty stores and six anchors:
Nordstrom, Macy's, two Robinsons-May stores, Sears and JC Penney.
The Company intends to continue to operate each of Downtown Plaza, Horton
Plaza and North County Fair as a super regional shopping center for the
foreseeable future.
Item 7. Financial Statements and Exhibits
---------------------------------
(a) Financial statements of properties acquired (or to be acquired) pursuant to
an Asset Purchase Agreement, dated as of April 6, 1998, between TrizecHahn
and The Rouse Company and the Company, as amended.
Index to Combined Statements of Revenue and Certain Expenses
------------------------------------------------------------
<TABLE>
<CAPTION>
Page Reference
Combined Statement of Revenue and Certain Expenses Form 8-K
-------------------------------------------------- --------------
<S> <C>
1. Los Cerritos Center and Oakridge Mall
-- Independent Auditors' Report F-1
-- Combined Statement of Revenue and Certain
Expenses for the year ended December 31, 1997 F-2
-- Notes to Combined Statement of Revenue and
Certain Expenses F-3
2. Downtown Plaza and Santa Anita Fashion Park
-- Independent Auditors' Report F-6
-- Combined Statement of Revenue and Certain
Expenses for the year ended December 31, 1997 F-7
-- Notes to Combined Statement of Revenue and
Certain Expenses. F-8
3. Selected TrizecHahn Acquisition Properties to Be Acquired
-- Independent Auditors' Report F-14
-- Combined Statement of Revenue and Certain
Expenses for the year ended December 31, 1997 F-15
-- Notes to Combined Statement of Revenue and
Certain Expenses F-16
4. Selected TrizecHahn Acquisition Properties to be
acquired less than 100%
-- Independent Auditors' Report F-21
-- Combined Statement of Revenue and Certain
Expenses for the year ended December 31, 1997 F-22
-- Notes to Combined Statement of Revenue and
Certain Expenses. F-23
</TABLE>
(b) Pro Forma Financial Information.
<TABLE>
<CAPTION>
Page Reference
Form 8-K
--------------
<S> <C>
1. Pro Forma Condensed Consolidated Balance Sheet as
of June 30, 1998 (unaudited) P-3
2. Notes to Pro Forma Condensed Consolidated Balance
Sheet (unaudited) P-5
3. Pro Forma Condensed Consolidated Statements of
Income for the six months ended June 30, 1998 and for
the year ended December 31, 1997 (unaudited) P-6
4. Notes to Pro Forma Condensed Consolidated
Statements of Income (unaudited) P-9
</TABLE>
i
<PAGE>
(c) Exhibits.
<TABLE>
<CAPTION>
Exhibit No. Description of Exhibit
- ----------- ----------------------
<C> <S>
10.1 Asset Purchase Agreement, dated as of April 6, 1998, between
TrizecHahn, and The Rouse Company and the Company,
incorporated herein by reference to Exhibit 10.1 to the
Company's Form 10-Q for the quarter ended June 30, 1998.
10.2 Amendment No. 1, dated as of July 31, 1998, between
TrizecHahn, and The Rouse Company and the Company,
incorporated herein by reference to Exhibit 10.2 to the
Company's Form 8-K dated July 31, 1998.
10.3 Amendment No. 2, dated as of August 31, 1998, between
TrizecHahn, and The Rouse Company and the Company,
incorporated herein by reference to Exhibit 10.3 to the
Company's Form 8-K dated September 25, 1998.
10.4 Amendment No. 3, dated as of September 23, 1998, between
TrizecHahn, and The Rouse Company and the Company,
incorporated herein by reference to Exhibit 10.4 to the
Company's Form 8-K dated September 25, 1998.
10.5 Amendment No. 4, dated as of September 25, 1998, between
TrizecHahn, and The Rouse Company and the Company,
incorporated herein by reference to Exhibit 10.5 to the
Company's Form 8-K dated September 25, 1998.
10.6 Amendment No. 5, dated as of October 7, 1998, between
TrizecHahn, and The Rouse Company and the Company,
incorporated herein by reference to Exhibit 10.6 to the
Company's Form 8-K dated September 25, 1998.
10.7 Amendment No. 6, dated as of October 22, 1998 between
TrizecHahn, and The Rouse Company and the Company.
10.8 Amendment No. 7, dated as of October 30, 1998 between
TrizecHahn, and The Rouse Company and the Company.
23.1 Consent of Independent Accountants - PricewaterhouseCoopers
LLP
23.2 Consent of Independent Auditors - KPMG Peat Marwick LLP
23.3 Consent of Independent Auditors - KPMG Peat Marwick LLP
99.1 Copy of the Press Release, dated November 2, 1998, issued
by the Company, publicly announcing the activities reported
therein.
</TABLE>
ii
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Board of Directors of Westfield America, Inc.,
the Managing General Partner of H and H - Cerritos,
and the Managing General Partner of Oakridge Associates:
We have audited the accompanying combined statement of revenue and certain
expenses of Los Cerritos Center and Oakridge Mall for the year ended December
31, 1997. This combined statement is the responsibility of management. Our
responsibility is to express an opinion on this combined statement based on our
audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the combined statement of revenue and certain expenses
is free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the combined statement. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of
the combined statement. We believe that our audit provides a reasonable basis
for our opinion.
The accompanying combined statement of revenue and certain expenses was prepared
for the purpose of complying with the rules and regulations of the Securities
and Exchange Commission as described in Note 1 to the combined statement of
revenue and certain expenses. It is not intended to be a complete presentation
of Los Cerritos Center and Oakridge Mall's combined revenue and expenses.
In our opinion, the combined statement referred to above presents fairly, in all
material respects, the combined revenue and certain expenses, as described in
Note 1, of Los Cerritos Center and Oakridge Mall for the year ended December 31,
1997 in conformity with generally accepted accounting principles.
/s/ KPMG Peat Marwick LLP
San Diego, California
May 27, 1998
F-1
<PAGE>
LOS CERRITOS CENTER AND OAKRIDGE MALL
COMBINED STATEMENT OF REVENUE AND CERTAIN EXPENSES
For the Year Ended December 31, 1997
(in Thousands)
<TABLE>
<S> <C>
Revenue:
Minimum rent (note 3) $15,533
Overage rent 267
Cart and temporary tenant rent 1,823
Recoveries from tenants 8,522
Other 1,386
-------
27,531
-------
Certain expenses:
Operating expenses 5,255
Payroll and related benefits - related party 1,875
Ground rent (note 3) 1,274
Property taxes 889
Professional services 75
Professional services - related party 32
Promotion 56
-------
9,456
-------
Revenue in excess of certain expenses $18,075
=======
</TABLE>
See accompanying notes to combined statement of revenue and certain expenses.
F-2
<PAGE>
LOS CERRITOS CENTER AND OAKRIDGE MALL
NOTES TO COMBINED STATEMENT OF REVENUE AND CERTAIN EXPENSES
For the Year Ended December 31, 1997
(in Thousands)
1. BASIS OF PRESENTATION
The accompanying combined statement of revenue and certain expenses relates
to the operations of Los Cerritos Center and Oakridge Mall (the
"Properties") located in Cerritos and San Jose, California, respectively.
Westfield America, Inc. (the "Company") intends to acquire the Properties.
The accompanying combined statement of revenue and certain expenses has
been prepared for the purpose of complying with the rules and regulations
of the Securities and Exchange Commission and accordingly, is not
representative of the actual results of operations of the Properties for
the year ended December 31, 1997 due to the exclusion of the following
expenses, which may not be comparable to the proposed future operations of
the Properties:
. Depreciation and amortization
. Interest on mortgages which will not be assumed by the Company
. Federal and state income taxes
. Management fees and leasing commissions
. Other costs not directly related to the proposed future
operations of the Properties
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES
REVENUE RECOGNITION
Minimum rent revenue is recognized on a straight-line basis over the term
of the individual leases. Overage rent, which is based upon the level of
sales achieved by the lessee, and cart and temporary tenant rent are
recognized on an accrual basis. Recoveries from tenants for real estate
taxes, insurance and certain other shopping center operating expenses are
recognized as revenue in the period the applicable costs are incurred.
MAINTENANCE AND REPAIRS
Maintenance and repairs are charged to operations as incurred.
USE OF ESTIMATES
Management has made a number of estimates and assumptions relating to the
reporting and disclosure of revenue and certain expenses during the
reporting period to prepare the combined statement of revenue and certain
expenses in conformity with generally accepted accounting principles.
Actual results could differ from those estimates.
F-3
<PAGE>
LOS CERRITOS CENTER AND OAKRIDGE MALL
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, CONTINUED
3. COMMITMENTS AND CONTINGENCIES
PARKING LEASE - LOS CERRITOS CENTER
In conjunction with the acquisition of Los Cerritos Center, the Company
will assume the lease of a parking area from one of the center's major
retailers. The term of the lease is 50 years, expiring in 2030. Total rent
expense under the lease was $50 in 1997.
Future minimum rents to be paid under the terms of the above lease are as
follows:
<TABLE>
<CAPTION>
YEARS ENDING DECEMBER 31,
---------------------------------
<S> <C>
1998 $ 50
1999 50
2000 50
2001 50
2002 50
Thereafter 1,400
------
$1,650
======
</TABLE>
GROUND LEASES - OAKRIDGE MALL
In conjunction with the acquisition of Oakridge Mall, the Company will
assume the ground leases related to the Property. In aggregate, these
leases require minimum annual rent payments of $203 plus a participation
percentage of 25% on the rent collected which exceeds a specified rent
base, as defined. These leases expire in 2008. Total rent expense under
these leases was $1,224 in 1997.
Future minimum rents to be paid under the terms of the above leases are as
follows:
<TABLE>
<CAPTION>
YEARS ENDING DECEMBER 31,
----------------------------------
<S> <C>
1998 $ 203
1999 203
2000 203
2001 203
2002 203
Thereafter 1,061
------
$2,076
======
</TABLE>
F-4
<PAGE>
LOS CERRITOS CENTER AND OAKRIDGE MALL
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, CONTINUED
SHOPPING CENTER LEASES
Shopping center space is leased to tenants under various operating leases
with terms ranging primarily from one to 24 years. The leases generally
provide for minimum rent and reimbursement of real estate taxes, insurance
and certain other operating expenses. The majority of the leases also
provide for additional overage rent during any year in which a tenant's
gross sales exceed a stated amount.
Future minimum rent revenue to be received under leases in force at
December 31, 1997 are as follows:
<TABLE>
<CAPTION>
YEARS ENDING DECEMBER 31,
----------------------------------
<S> <C>
1998 $16,145
1999 15,311
2000 13,823
2001 12,782
2002 11,487
Thereafter 27,817
-------
$97,365
=======
</TABLE>
LEGAL
The Properties are, from time to time, involved in various claims and legal
actions arising in the ordinary course of business. Although the final
outcome of these legal matters cannot be determined, it is management's
opinion, based in part on advice of legal counsel, that the final
resolution of these matters will not have a material adverse effect on the
Properties' results of operations.
4. RELATED-PARTY TRANSACTIONS
MANAGEMENT
The previous owner and its wholly-owned subsidiary have provided various
professional services to the Properties.
A summary of costs and fees incurred and expensed for the year ended
December 31, 1997 follows:
<TABLE>
<S> <C>
Payroll and related benefits $1,875
Professional services 32
</TABLE>
F-5
<PAGE>
INDEPENDENT AUDITOR'S REPORT
The Board of Directors of Westfield America, Inc.,
the Managing General Partner of DPA, L.P.,
and the General Partner of Anita Associates:
We have audited the accompanying combined statement of revenue and certain
expenses of Downtown Plaza and Santa Anita Fashion Park for the year ended
December 31, 1997. This combined statement is the responsibility of management.
Our responsibility is to express an opinion on this combined statement based on
our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the combined statement of revenue and certain expenses
is free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the combined statement. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of
the combined statement. We believe that our audit provides a reasonable basis
for our opinion.
The accompanying combined statement of revenue and certain expenses was prepared
for the purpose of complying with the rules and regulations of the Securities
and Exchange Commission as described in Note 1 to the combined statement of
revenue and certain expenses. It is not intended to be a complete presentation
of Downtown Plaza and Santa Anita Fashion Park's combined revenue and expenses.
In our opinion, the combined statement referred to above presents fairly, in all
material respects, the combined revenue and certain expenses, as described in
Note 1, of Downtown Plaza and Santa Anita Fashion Park for the year ended
December 31, 1997 in conformity with generally accepted accounting principles.
/S/ KPMG Peat Marwick LLP
San Diego, California
May 27, 1998
F-6
<PAGE>
DOWNTOWN PLAZA AND SANTA ANITA FASHION PARK
COMBINED STATEMENT OF REVENUE AND CERTAIN EXPENSES
For the Year Ended December 31, 1997
(in Thousands)
<TABLE>
<CAPTION>
<S> <C>
Revenue:
Minimum rent (note 4) $21,046
Overage rent 261
Cart and temporary tenant rent 1,284
Recoveries from tenants 9,805
Other 1,315
-------
33,711
-------
Certain expenses:
Operating expenses 8,040
Interest 12,152
Interest - related party 2,315
Payroll and related benefits - related party 2,302
Ground rent - related party 511
Property taxes 962
Management fees - related party 1,087
Leasing commissions - related party 125
Professional services 108
Professional services - related party 41
Promotion 615
-------
28,258
-------
Revenue in excess of certain expenses $ 5,453
=======
</TABLE>
See accompanying notes to combined statement of revenue and certain expenses.
F-7
<PAGE>
DOWNTOWN PLAZA AND SANTA ANITA FASHION PARK
NOTES TO COMBINED STATEMENT OF REVENUE AND CERTAIN EXPENSES
FOR THE YEAR ENDED DECEMBER 31, 1997
1. ORGANIZATIONS AND BASIS OF PRESENTATION
The accompanying combined statement of revenue and certain expenses relates
to the operations of Downtown Plaza and Santa Anita Fashion Park (the
"Properties"), located in Sacramento and Arcadia, California, respectively.
Westfield America, Inc. (the "Company") intends to acquire a 50%
partnership interest in DPA, L.P., a California limited partnership, and a
39.68% partnership interest in Anita Associates, a California limited
partnership, (collectively the "Partnerships"), which own Downtown Plaza
and Santa Anita Fashion Park, respectively.
DOWNTOWN PLAZA
DPA, L.P. is a California limited partnership formed on November 1, 1991
for the purpose of redeveloping and operating Downtown Plaza, a regional
shopping center and office complex. The partnership agreement provides that
DPA, L.P. is to continue until December 31, 2025, unless sooner terminated.
Profits and losses are shared as follows:
<TABLE>
<S> <C>
General Partners:
DPA-H, Inc., a California corporation 50.0%
PKL Corp., a California corporation 1.0%
Limited Partners:
Campbell, Mackey and Gibson, a California general partnership 12.5%
Edward K. Rice 2.62625%
Alice O. Rice, Trustee of Alice O. Rice Living Trust 8.87375%
Sacvent Garage, a California corporation 12.5%
Teichert Land Co., a California corporation 12.5%
</TABLE>
DPA-H, Inc. is 100% owned by TrizecHahn Centers Inc.
F-8
<PAGE>
DOWNTOWN PLAZA AND SANTA ANITA FASHION PARK
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, CONTINUED
SANTA ANITA FASHION PARK
Anita Associates is a California limited partnership consisting of Hahn-
UPI, the general partner, and Santa Anita Realty Enterprises, Inc., formed
to develop and operate Santa Anita Fashion Park, a regional shopping
center. Hahn-UPI is a limited partnership consisting of TrizecHahn Centers
Inc., the general partner, and UPI Associates, the limited partner. UPI
does not have responsibility for, or participation in, any duties,
obligations or rights of approval assumed by Hahn-UPI as general partner of
Anita Associates. The partnership agreement provides that Anita Associates
shall continue from year to year until the partners elect to terminate the
partnership. Profits and losses are shared as follows:
Hahn-UPI:
TrizecHahn Centers Inc. 39.68%
UPI Associates 10.32%
Santa Anita Realty Enterprises, Inc. 50.00%
The accompanying combined statement of revenue and certain expenses has
been prepared for the purpose of complying with the rules and regulations
of the Securities and Exchange Commission and accordingly, is not
representative of the actual results of operations of the Properties for
the year ended December 31, 1997 due to the exclusion of the following
expenses, which may not be comparable to the proposed future operations of
the Properties:
. Depreciation and amortization
. Federal and state income taxes
. Other costs not directly related to the proposed future
operations of the Properties
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES
REVENUE RECOGNITION
Minimum rent revenue is recognized on a straight-line basis over the term
of the individual leases. Overage rent, which is based upon the level of
sales achieved by the lessee, and cart and temporary tenant rent are
recognized on an accrual basis. Recoveries from tenants for real estate
taxes, insurance and certain other shopping center operating expenses are
recognized as revenue in the period the applicable costs are incurred.
F-9
<PAGE>
DOWNTOWN PLAZA AND SANTA ANITA FASHION PARK
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, CONTINUED
MAINTENANCE AND REPAIRS
Maintenance and repairs are charged to operations as incurred.
USE OF ESTIMATES
Management has made a number of estimates and assumptions relating to the
reporting and disclosure of revenue and certain expenses during the
reporting period to prepare the combined statement of revenue and certain
expenses in conformity with generally accepted accounting principles.
Actual results could differ from those estimates.
3. MORTGAGE NOTES PAYABLE
DOWNTOWN PLAZA
A loan in the amount of $93,000, secured by a deed of trust on the
property, was executed by DPA, L.P. on November 27, 1991. The loan bears
interest at a base rate, as defined in the loan agreement, plus a spread or
at the then current London Interbank offer rate ("LIBOR") plus 1.5%, as
selected by DPA, L.P. Interest is payable under the terms of the loan,
either monthly or quarterly, also as selected by DPA, L.P., and the note is
due December 2, 1998. The principal balance of the loan at December 31,
1997 was $92,476.
SANTA ANITA FASHION PARK
Loans in the amounts of $46,577 and $15,778, secured by a first lien on the
leasehold estates and improvements, were executed by Anita Associates in
1994. The loans bear interest at a rate of 9.0% and 9.25%, respectively,
with principal and interest payments of $391 and $136, respectively, due
monthly through February 2004, at which time the outstanding principal
balances and any accrued interest thereon are due. The principal balances
of the loans at December 31, 1997 were $44,306 and $15,184, respectively.
4. COMMITMENTS AND CONTINGENCIES
PARTNERSHIPS AS LESSORS
The Partnerships lease space to tenants in the shopping centers for which
they charge minimum rent and receive reimbursement for real estate taxes,
insurance and certain other shopping center operating expenses. The terms
of the leases vary by tenant and range from one to 30 years, and the
majority of the leases also provide for additional overage rents during any
year in which a tenant's gross sales exceed a stated amount.
F-10
<PAGE>
DOWNTOWN PLAZA AND SANTA ANITA FASHION PARK
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, CONTINUED
Future minimum rent revenue to be received under leases in force at
December 31, 1997 are as follows:
<TABLE>
<CAPTION>
YEARS ENDING DECEMBER 31,
----------------------------------
<S> <C>
1998 $ 21,340
1999 20,836
2000 20,073
2001 19,359
2002 18,819
Thereafter 65,109
--------
$165,536
========
</TABLE>
LEGAL
The Partnerships are, from time to time, involved in various claims and
legal actions arising in the ordinary course of business. Although the
final outcome of these legal matters cannot be determined, it is
management's opinion, based in part on advice of legal counsel, that the
final resolution of these matters will not have a material adverse effect
on the Partnerships' financial position, results of operations, or
liquidity.
5. RELATED PARTY TRANSACTIONS
MANAGEMENT
Affiliates of the general partners of the Partnerships have provided
property management, leasing and various professional services to the
Properties.
A summary of costs and fees incurred and expensed for the year ended
December 31, 1997 follows:
<TABLE>
<S> <C>
Payroll and related benefits $2,302
Management fees 1,087
Leasing commissions 125
Professional services 41
</TABLE>
F-11
<PAGE>
DOWNTOWN PLAZA AND SANTA ANITA FASHION PARK
COMBINED STATEMENT OF REVENUE AND CERTAIN EXPENSES, CONTINUED
ADVANCES FROM PARTNER
In accordance with DPA, L.P.'s partnership agreement, the managing general
partner was required to make cash advances totaling $20,922. The advances
bear interest at a rate of prime plus 1%, and the principal balance and any
accrued interest is to be repaid over a five-year period, beginning October
1998. Interest incurred for the year ended December 31, 1997 was $2,315.
The principal balance of the advances at December 31, 1997 was $20,922.
GROUND LEASE
Santa Anita Fashion Park was developed on approximately 70 acres of land
leased from the limited partner of Anita Associates. The leased property
consists of four parcels, each covered by a separate ground lease,
requiring total annual rentals of $768 in 1997. Three of the parcels are
subleased for aggregate rentals of $257 annually. The sublease terms are
identical to the primary lease and continue through October 2017. The
subleases are assigned to the limited partner of Anita Associates.
Net rental expense amounted to $511 in 1997. The minimum annual rental
payments under the lease, net of sublease rentals, are as follows:
<TABLE>
<CAPTION>
YEARS ENDING DECEMBER 31, AMOUNT
--------------------------------- ------
<S> <C>
1998 $ 537
1999 537
2000 537
2001 537
2002 537
Thereafter 7,953
-------
$10,638
=======
</TABLE>
F-12
<PAGE>
DOWNTOWN PLAZA AND SANTA ANITA FASHION PARK
COMBINED STATEMENT OF REVENUE AND CERTAIN EXPENSES, CONTINUED
6. PARTNERSHIP INTEREST (UNAUDITED)
The following calculation reflects the revenue in excess of certain
expenses multiplied by DPA-H, Inc.'s, DPA, L.P.'s managing general partner,
partnership interest and TrizecHahn Center Inc.'s, Anita Associates'
general partner, partnership interest in the Partnerships, as stated in
Note 1, for the year ended December 31, 1997:
<TABLE>
<CAPTION>
SANTA ANITA
DOWNTOWN FASHION
PLAZA PARK COMBINED
--------- ----------- --------
<S> <C> <C> <C>
Revenue in excess of certain expenses $1,763 3,690 $5,453
======
DPA-H, Inc.'s interest 50.00% --
TrizecHahn Center Inc.'s interest -- 39.68%
------ -----
$ 881 1,464 $2,345
====== ===== ======
</TABLE>
F-13
<PAGE>
INDEPENDENT AUDITORS' REPORT
__________
To the Board of Directors
of Westfield America, Inc.
We have audited the accompanying combined statement of revenues and certain
expenses for the year ended December 31, 1997 of selected TrizecHahn Acquisition
Properties, as defined in Note 1, which are intended to be acquired by Westfield
America, Inc. This combined statement is the responsibility of the management
of TrizecHahn Centers, Inc. Our responsibility is to express an opinion on this
combined statement based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the combined statement is free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the statement. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall presentation of the combined statement. We believe
that our audit provides a reasonable basis for our opinion.
As described in Note 2, this combined statement excludes certain expenses that
would not be comparable with those resulting from the operations of the
TrizecHahn Acquisition Properties after acquisition by Westfield America, Inc.
The accompanying combined statement was prepared for the purpose of complying
with the rules and regulations of the Securities and Exchange Commission Rule 3-
14 of Regulation S-X and is not intended to be a complete presentation of the
TrizecHahn Acquisition Properties' revenues and expenses.
In our opinion, the combined statement referred to above presents fairly, in all
material respects, the revenues and certain expenses described in Note 2, of the
TrizecHahn Acquisition Properties for the year ended December 31, 1997, in
conformity with generally accepted accounting principles.
/s/ Coopers & Lybrand LLP
Newport Beach, California
May 29, 1998
F-14
<PAGE>
TRIZECHAHN ACQUISITION PROPERTIES
COMBINED STATEMENT OF REVENUES AND CERTAIN EXPENSES
OF SELECTED TRIZECHAHN ACQUISITION PROPERTIES
TO BE ACQUIRED BY WESTFIELD AMERICA, INC.
FOR THE YEAR ENDED DECEMBER 31, 1997
(IN THOUSANDS)
<TABLE>
<S> <C>
Revenues:
Minimum rent $39,574
Overage rent 1,665
Carts and temporary tenant rents 4,213
Recoveries from tenants 25,210
Parking structure income 2,687
Other income 2,088
-------
75,437
-------
Certain expenses:
Operating expenses 18,668
Property taxes 5,830
Parking structure expenses 1,232
Promotion 383
Professional services 339
Ground lease 112
Redevelopment agency fee 221
Other expenses 339
-------
27,124
-------
Revenues in excess of certain expenses $48,313
=======
</TABLE>
The accompanying notes are an integral part of this combined statement.
F-15
<PAGE>
TRIZECHAHN ACQUISITION PROPERTIES
NOTES TO COMBINED STATEMENT OF REVENUE AND CERTAIN EXPENSES
1. DESCRIPTION OF THE PROPERTIES AND ORGANIZATION:
The accompanying combined statement of revenues and certain expenses
("Combined Statement") of the TrizecHahn Acquisition Properties, as defined
herein, relates to the operations of five regional shopping centers (the
"TrizecHahn Acquisition Properties" or "Properties"), each of which is
owned by a partnership (together, the "Partnerships") and is managed by
TrizecHahn Centers Management, Inc. ("THCMI"), a wholly-owned subsidiary of
one of the partners, TrizecHahn Centers, Inc. ("TrizecHahn"). The
Properties are intended to be sold to Westfield America, Inc. ("Westfield")
in a single transaction subject to, among other things, an executed Asset
Purchase Agreement between TrizecHahn and Westfield.
<TABLE>
<CAPTION>
Property Abbreviated
Properties Partnerships Locations Names
- ------------------------ --------------------------------- ---------------- ------------
<S> <C> <C> <C>
Fox Hills Mall H, B-H Associates Culver City, CA Fox Hills
Horton Plaza HSD/Horton Associates San Diego, CA Horton Plaza
Parkway Plaza H and H El Cajon El Cajon, CA Parkway Plaza
Solano Mall Solano Associates Fairfield, CA Solano Mall
University Towne Centre University Town Center Associates San Diego, CA UTC
</TABLE>
2. SIGNIFICANT ACCOUNTING POLICIES:
The following are significant accounting policies followed in the
preparation of the accompanying Combined Statement. This Combined
Statement and notes are representations of TrizecHahn and THCMI, whose
managements are responsible for their integrity and objectivity.
Basis of Presentation:
---------------------
The accompanying Combined Statement is presented on the accrual basis of
accounting in conformity with Rule 3-14 of Regulation S-X of the Securities
and Exchange Commission. Accordingly, it is not representative of the
actual operations for the period presented because certain expenses, which
may not be comparable to those expected to be incurred by Westfield in the
proposed future operations of the Properties, have been excluded. Expenses
excluded consist of depreciation and amortization, management and leasing
fees and mortgage interest.
F-16
<PAGE>
TRIZECHAHN ACQUISITION PROPERTIES
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, Continued
2. SIGNIFICANT ACCOUNTING POLICIES, CONTINUED:
Revenue Recognition:
-------------------
Minimum rental revenues are recognized on a straight-line basis over the
terms of the individual leases. Certain of the leases provide for
additional rental revenue ("Overage Rents") to be paid based upon the level
of sales achieved by the lessee. These Overage Rents are recognized on the
accrual basis. Tenants are also charged for certain operating expenses,
including real estate taxes, insurance and common area costs. Such
recovery is recorded in the period the applicable costs are incurred.
Lease Fees:
----------
Payments received from tenants in connection with early termination of a
tenant's lease(s) are recognized as income when received.
Maintenance and Repairs:
-----------------------
Maintenance and repairs are charged to operations as incurred.
Management's Estimates and Certain Risks:
----------------------------------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from these
estimates.
3. COMMITMENTS AND CONTINGENCIES:
Partnerships as Lessors:
-----------------------
The Partnerships lease space to tenants in the shopping centers for which
they charge minimum rents and receive reimbursements for real estate taxes,
insurance and certain other shopping center operating expenses. The leases
are noncancelable with varying terms, some of which have renewal options
available.
F-17
<PAGE>
TRIZECHAHN ACQUISITION PROPERTIES
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, Continued
3. COMMITMENTS AND CONTINGENCIES, CONTINUED:
Partnerships as Lessors, continued:
----------------------------------
Future minimum rental revenues to be received under leases in effect at
December 31, 1997 are as follows (in thousands):
<TABLE>
<S> <C>
1998 $ 41,648
1999 39,354
2000 35,007
2001 29,593
2002 25,659
Thereafter 102,531
--------
$273,792
========
</TABLE>
Horton Plaza charges the tenants a parking structure validation fee which
entitles the tenants' customers to use the parking structure adjacent to
the shopping center. Future parking structure income to be received under
leases in force at December 31, 1997 is as follows (in thousands):
<TABLE>
<S> <C>
1998 $ 510
1999 490
2000 476
2001 443
2002 415
Thereafter 2,531
------
$4,865
======
</TABLE>
Partnerships as Lessee:
----------------------
Parkway Plaza leases the land underlying the shopping center from Sears,
Roebuck and Co. at an annual cost of $112,000 until August 2000 with an
increase to $128,000 per year thereafter. The lease expires in July 2051.
F-18
<PAGE>
TRIZECHAHN ACQUISITION PROPERTIES
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, Continued
3. COMMITMENTS AND CONTINGENCIES, CONTINUED:
Partnerships as Lessee, continued:
---------------------------------
Minimum annual rental payments for Parkway Plaza are as follows (in
thousands):
<TABLE>
<S> <C>
1998 $ 112
1999 112
2000 112
2001 117
2002 128
Thereafter 6,156
------
$6,737
======
</TABLE>
Redevelopment Agency Fee:
------------------------
Pursuant to the Development and Disposition Agreement ("DDA Agreement")
between HSD/Horton Associates and the Redevelopment Agency of the City of
San Diego (the "Agency"), the Agency conveyed certain parcels of real
estate to HSD/Horton Associates for the development of Horton Plaza.
In connection with the DDA Agreement, HSD/Horton Associates entered into a
Payment Agreement whereby HSD/Horton Associates pays a participation amount
equal to 10% of gross rental income received, as defined, in excess of
$8,750,000. Participation in the amount of $221,000 was due to the Agency
for the year ended December 31, 1997.
Legal:
-----
The Partnerships are, from time to time, involved in various claims and
legal actions arising in the ordinary course of business. Although the
final outcome of these legal matters cannot be determined, it is
management's opinion, based in part upon advice from legal counsel, that
the final resolution of these matters will not have a material adverse
effect on the Partnerships' results of operations.
F-19
<PAGE>
TRIZECHAHN ACQUISITION PROPERTIES
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, Continued
4. RELATED PARTY TRANSACTIONS:
TrizecHahn and its wholly-owned subsidiary, THCMI, provided payroll,
professional and various legal services to the Partnerships.
A summary of related party costs and fees included in operating expense for
the year ended December 31, 1997 is as follows (in thousands):
<TABLE>
<S> <C>
Payroll and related benefits $6,521
Professional services 130
Legal fees 334
------
$6,985
======
</TABLE>
F-20
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors
of Westfield America, Inc.
We have audited the accompanying combined statement of revenues and certain
expenses for the year ended December 31, 1997 of selected TrizecHahn Acquisition
Properties, as defined in Note 1, which are intended to be acquired less than
100% by Westfield America, Inc. This combined statement is the responsibility
of TrizecHahn Centers, Inc. management. Our responsibility is to express an
opinion on this combined statement based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the combined statement is free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the statement. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall presentation of the combined statement. We believe
that our audit provides a reasonable basis for our opinion.
As described in Note 2, this combined statement excludes certain expenses that
would not be comparable with those resulting from the operations of the
TrizecHahn Acquisition Properties after acquisition by Westfield America, Inc.
The accompanying combined statement was prepared for the purpose of complying
with the rules and regulations of the Securities and Exchange Commission Rule 3-
14 of Regulation S-X and is not intended to be a complete presentation of the
TrizecHahn Acquisition Properties' revenues and expenses.
In our opinion, the combined statement referred to above presents fairly, in all
material respects, the revenues and certain expenses described in Note 2, of the
TrizecHahn Acquisition Properties for the year ended December 31, 1997, in
conformity with generally accepted accounting principles.
/s/ Coopers & Lybrand LLP
Newport Beach, California
April 27, 1998
F-21
<PAGE>
TRIZECHAHN ACQUISITION PROPERTIES
COMBINED STATEMENT OF REVENUES AND CERTAIN EXPENSES
OF SELECTED TRIZECHAHN ACQUISITION PROPERTIES
TO BE ACQUIRED LESS THAN 100%
BY WESTFIELD AMERICA, INC.
FOR THE YEAR ENDED DECEMBER 31, 1997
(IN THOUSANDS)
<TABLE>
<S> <C>
Revenues:
Minimum rent $28,206
Overage rent 2,279
Carts and temporary tenant rents 2,933
Recoveries from tenants 12,815
Other income 938
-------
47,171
-------
Certain expenses:
Operating expenses 9,278
Interest 13,464
Property taxes 2,468
Office and management 1,064
Promotion 84
Professional services 142
Ground lease 1,296
Other expenses 266
-------
28,062
-------
Revenues in excess of certain expenses $19,109
=======
</TABLE>
The accompanying notes are an integral part of this combined statement.
F-22
<PAGE>
TRIZECHAHN ACQUISITION PROPERTIES
NOTES TO COMBINED STATEMENT OF REVENUE AND CERTAIN EXPENSES
1. DESCRIPTION OF THE PROPERTIES AND ORGANIZATION:
The accompanying combined statement of revenues and certain expenses
("Combined Statement") of the TrizecHahn Acquisition Properties, as defined
herein, relates to the operations of three regional shopping centers (the
"TrizecHahn Acquisition Properties" or "Properties"), each of which is
owned by a partnership (together, the "Partnerships") and is managed by
TrizecHahn Centers Management, Inc. ("THCMI"), a wholly-owned subsidiary of
one of the partners, TrizecHahn Centers, Inc. ("TrizecHahn"). The
ownership interest of TrizecHahn in the Partnerships is intended to be sold
to Westfield America, Inc. ("Westfield") in a single transaction subject
to, among other things, an executed Asset Purchase Agreement between
TrizecHahn and Westfield.
<TABLE>
<CAPTION>
Properties Partnerships Property Locations
- ----------------- ----------------------------- -------------------
<S> <C> <C>
Valley Fair Stevens Creek Associates San Jose, CA
Capital Mall Capital Mall Company Olympia, WA
North County Fair EWH Escondido Associates, LP Escondido, CA
</TABLE>
Valley Fair:
-----------
Stevens Creek Associates is a California general partnership formed for the
purpose of improving, renovating and integrating two existing shopping
centers, known as "Valley Fair Shopping Center," located in San Jose,
California, and "Stevens Creek Plaza," located in the cities of San Jose
and Santa Clara, California, into a regional shopping center known as
"Valley Fair." The partnership agreement provides that the partnership is
to continue until December 31, 2024 unless terminated earlier.
The revenues and certain expenses of Stevens Creek Associates include the
accounts of Stevens Creek Associates and its wholly-owned subsidiary, Hahn
Issuing Corporation (the "Subsidiary"). The Subsidiary is a Delaware
corporation formed in 1986 solely for the purpose of issuing commercial
paper to private investors under the Partnership's credit agreement with a
commercial bank. All significant intercompany balances and transactions
have been eliminated.
The general partners and their respective partnership interests are as
follows:
<TABLE>
<S> <C>
TrizecHahn 33.33%
RT-H Corporation ("RT-H") 16.67%
Valley Fair Associates, L.P. ("VFA") 50.00%
</TABLE>
RT-H is effectively wholly owned by TrizecHahn.
F-23
<PAGE>
TRIZECHAHN ACQUISITION PROPERTIES
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, Continued
1. DESCRIPTION OF THE PROPERTIES AND ORGANIZATION, CONTINUED:
Valley Fair, Continued:
----------------------
Profit and loss is allocated at year-end based upon each partner's capital
(deficit) account balance, as defined in the partnership agreement.
Capital Mall:
------------
Capital Mall Company is a Washington limited partnership formed by
TrizecHahn, JCP Realty, Inc., a wholly-owned subsidiary of JCPenney
Company, Inc. and Cordano Associates to develop and operate a regional
shopping center in Olympia, Washington. The partnership agreement provides
for the partnership to terminate as of December 31, 2038. Profits and
losses and distributions of net cash flows, as defined by the partnership
agreement, are shared as follows:
<TABLE>
<S> <C>
General partner:
TrizecHahn 50%
Limited partners:
JCP Realty, Inc. 25%
Cordano Associates 25%
</TABLE>
North County Fair:
-----------------
EWH Escondido Associates, L.P. is a Delaware limited partnership formed for
the purpose of developing, constructing, and operating a regional shopping
center in Escondido, California. The partnership agreement, dated April
25, 1984, provides that the partnership is to terminate as of June 30,
2033, unless terminated or dissolved earlier. The partners and their
respective interests are as follows:
<TABLE>
<S> <C>
General partner:
EWH 1979 Development Company, L.P. ("EWH") 55%
Limited partner:
Westfield America, Inc. 45%
</TABLE>
EWH is effectively wholly-owned by TrizecHahn.
F-24
<PAGE>
TRIZECHAHN ACQUISITION PROPERTIES
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, Continued
2. SIGNIFICANT ACCOUNTING POLICIES:
The following are significant accounting policies followed in the
preparation of the accompanying Combined Statement. This Combined
Statement and notes are representations of TrizecHahn and THCMI, whose
managements are responsible for their integrity and objectivity.
Basis of Presentation:
---------------------
The accompanying Combined Statement is presented on the accrual basis of
accounting in conformity with Rule 3-14 of Regulation S-X of the Securities
and Exchange Commission. Accordingly, it is not representative of the
actual operations for the period presented because certain expenses, which
may not be comparable to those expected to be incurred by Westfield in the
proposed future operations of the Properties, have been excluded. Expenses
excluded consist of depreciation and amortization. For North County Fair
which will become wholly-owned by Westfield upon acquisition of
TrizecHahn's 55% interest, management and leasing fees have also been
excluded.
Revenue Recognition:
-------------------
Minimum rent revenues are recognized on a straight-line basis over the
terms of the individual leases. Certain of the leases provide for
additional rental revenue ("Overage Rents") to be paid based upon the level
of sales achieved by the lessee. These Overage Rents are recognized on the
accrual basis. Tenants are also charged for certain operating expenses,
including real estate taxes, insurance and common area costs. Such recovery
is recorded in the period the applicable costs are incurred.
Lease Fees:
----------
Payments received from tenants in connection with early termination of a
tenant's lease(s) are recognized as income when received.
Maintenance and Repairs:
-----------------------
Maintenance and repairs are charged to operations as incurred.
Management's Estimates and Certain Risks:
----------------------------------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from these
estimates.
F-25
<PAGE>
TRIZECHAHN ACQUISITION PROPERTIES
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, Continued
3. INTEREST EXPENSE:
Valley Fair:
-----------
On October 20, 1997, the Partnership entered into a $100 million loan
agreement with a commercial bank which is collateralized by a deed of trust
on the shopping center property and an assignment of leases and rents. The
agreement provides that the Partnership can: (1) borrow funds at the
greater of the then current federal funds rate plus 0.5% per annum or the
then current prime rate of the commercial banks; or (2) borrow funds at the
current London Interbank Offered ("LIBO") rate, as defined, plus 0.75% per
annum for periods ranging from one to six months. $80 million was
initially drawn on the loan with the proceeds being used to pay off the
interest rate exchange contract which expired. These funds were obtained
under the LIBO option. Interest is payable monthly and the note balance is
due October 20, 1999. The variable interest rate in effect on the
outstanding balance as of December 31, 1997 was 6.625%.
The Partnership had also entered into interest rate exchange contracts,
aggregating $41,000,000, to minimize the impact of changes in interest
rates associated with the commercial paper program. The exchange contracts
provided for the Partnership to pay annual interest at an average fixed
rate of 8.825%. Variable interest payments received were based on various
market indexes including six-month LIBO and thirty-day commercial paper.
Total interest expense was $5,355,000 for the year ended December 31, 1997.
Capital Mall:
------------
Notes payable at December 31, 1997 consist of the following (in thousands):
<TABLE>
<S> <C>
Connecticut General Life Insurance Company $11,817
Lincoln National Life Insurance Company 2,883
-------
$14,700
=======
</TABLE>
The note payable to Connecticut General Life Insurance Company is
collateralized by a deed of trust on certain shopping center property. The
note matures in 2000 and is payable in monthly installments of $132,000,
including interest at 9%, with all remaining principal due in the year
2000.
Notes payable to Lincoln National Life Insurance Company are collateralized
by deeds of trust on the remaining shopping center property. The notes
mature in 2009 and are payable in monthly installments of $34,000,
including interest at 8-5/8% and 9-3/4%.
F-26
<PAGE>
TRIZECHAHN ACQUISITION PROPERTIES
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, Continued
3. INTEREST EXPENSE, CONTINUED:
North County Fair:
-----------------
North County Fair has a note which is payable to an insurance company and
is collateralized by a first deed of trust and assignment of rents on the
shopping center property. The note matures in June 2002 and is payable in
monthly installments of $533,000, including interest at 12.25% with
contingent interest of 30% of the excess of gross receipts, as defined,
over a base amount. Contingent interest expense in 1997 amounted to
$587,000.
4. COMMITMENTS AND CONTINGENCIES:
Partnerships as Lessors:
-----------------------
The Partnerships lease space to tenants in the shopping centers for which
they charge minimum rents and receive reimbursements for real estate taxes,
insurance and certain other shopping center operating expenses. The leases
are noncancelable with varying terms, some of which have renewal options
available.
Future minimum rental revenues to be received under leases in effect at
December 31, 1997 are as follows (in thousands):
<TABLE>
<S> <C>
1998 $ 27,953
1999 26,502
2000 24,920
2001 23,803
2002 21,489
Thereafter 68,951
--------
$193,618
========
</TABLE>
Partnerships as Lessees:
-----------------------
Capital Mall
------------
Capital Mall leases the land underlying the shopping center from
Connecticut General Life Insurance Company at an annual cost of $213,000,
plus a percentage of rental revenues generated by the shopping center. The
lease expires in April 2040. Participation rent expense totaled $224,000
for the year ended December 31, 1997.
F-27
<PAGE>
TRIZECHAHN ACQUISITION PROPERTIES
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, Continued
4. COMMITMENTS AND CONTINGENCIES, CONTINUED:
PARTNERSHIPS AS LESSEES, CONTINUED:
----------------------------------
Capital Mall, Continued
-----------------------
Minimum annual rental payments for Capital Mall are as follows (in
thousands):
<TABLE>
<S> <C>
1998 $ 213
1999 213
2000 213
2001 213
2002 213
Thereafter 7,940
------
$9,005
======
</TABLE>
North County Fair
-----------------
A portion of the North County Fair shopping center is situated on land
leased from two local municipalities. Both leases provide for a fixed
annual rent and a contingent rental when rental receipts, as defined,
exceed certain levels. The terms run concurrently for 55 years and expire
in 2038. Contingent rentals of $61,000 are included in ground lease
expense for 1997.
A portion of land on one of the leased tracts has been subleased by North
County Fair to the anchor department stores. North County Fair's fixed
annual rent is reduced by payments made directly to the municipality under
the subleases. North County Fair is contingently liable for the total
fixed annual rent amount. There have been no instances of nonpayment by
the department stores.
F-28
<PAGE>
TRIZECHAHN ACQUISITION PROPERTIES
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, Continued
4. COMMITMENTS AND CONTINGENCIES, CONTINUED:
PARTNERSHIPS AS LESSEES, CONTINUED:
----------------------------------
North County Fair, Continued
----------------------------
Minimum annual fixed rental payments under both leases, including the
anchor department stores, for North County Fair are as follows (in
thousands):
<TABLE>
<CAPTION>
Expected
Department
Gross Stores' Expected Net
Fixed Rent Fixed Rent Fixed Rent
---------- ---------- ------------
<S> <C> <C> <C>
1998 $ 1,190 $ (392) $ 798
1999 1,190 (392) 798
2000 1,190 (392) 798
2001 1,190 (392) 798
2002 1,190 (392) 798
Thereafter 42,245 (13,916) 28,329
------- -------- -------
$48,195 $(15,876) $32,319
======= ======== =======
</TABLE>
Legal:
-----
The Partnerships are, from time to time, involved in various claims and
legal actions arising in the ordinary course of business. Although the
final outcome of these legal matters cannot be determined, it is
management's opinion, based in part upon advice from legal counsel, that
the final resolution of these matters will not have a material adverse
effect on the Partnerships' results of operations.
F-29
<PAGE>
TRIZECHAHN ACQUISITION PROPERTIES
NOTES TO COMBINED STATEMENT OF REVENUE
AND CERTAIN EXPENSES, Continued
5. RELATED PARTY TRANSACTIONS:
TrizecHahn and its wholly-owned subsidiary, THCMI, provided payroll,
professional and various legal services to the Partnerships.
A summary of related party costs and fees included in operating expense for
the year ended December 31, 1997 is as follows (in thousands):
<TABLE>
<S> <C>
Management fees $ 884
Payroll and related benefits 3,158
Professional services 548
Leasing commissions 901
Legal fees 222
------
$5,713
======
</TABLE>
6. TRIZECHAHN'S PARTNERSHIP INTEREST (UNAUDITED):
The following calculation reflects the revenues in excess of certain
expenses multiplied by TrizecHahn's interest in the Partnerships as stated
in Note 1.
For the Twelve Months Ended December 31, 1997 (in thousands):
------------------------------------------------------------
<TABLE>
<CAPTION>
North
Valley Fair Capital Mall County Fair Combined
----------- ------------ ----------- --------
<S> <C> <C> <C> <C>
Revenues in excess of certain expenses $13,006 $2,427 $3,676 $19,109
TrizecHahn's interest 50% 50% 55%
------- ------ ------ -------
$ 6,503 $1,214 $2,022 $ 9,739
======= ====== ====== =======
</TABLE>
F-30
<PAGE>
PRO FORMA FINANCIAL INFORMATION
Pursuant to an Asset Purchase Agreement, dated April 6, 1998, between TrizecHahn
and The Rouse Company and the Company, as amended (the "Agreement"), the Company
has agreed to acquire interests in twelve shopping centers (the "Hahn
Portfolio") from TrizecHahn and one of TrizecHahn's joint venture partners.
Under the Agreement, the Company will acquire a 100% interest in seven shopping
centers (the "Wholly-Owned Centers"), partial interests in four shopping centers
(the "Joint Venture Centers") and the remaining 55% interest in North County
Fair that the Company does not already own.(1)
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
This Current Report includes, and future public filings and oral and written
statements by the Company and its management may include, statements (other than
the historical financial statements and other statements of historical fact)
that are subject to risks and uncertainties. Forward-looking statements include
the information concerning the possible acquisition of certain properties
comprising part of the Hahn Portfolio. Statements preceded by, followed by or
that include the words "believes," "expects," "anticipates," "intends," "plans,"
"estimates," "assumes," "assuming," "projects," "projected" or similar
expressions indicate forward-looking statements.
Forward-looking statements are made based on management's current expectations
and belief concerning future developments and their potential effects on the
Company. There can be no assurance that future developments will be in
accordance with management's expectations or that the effect of future
developments on the Company will be those anticipated by management. Many of the
factors that will determine these results are beyond the Company's ability to
control or predict.
While the Company periodically reassesses material trends and uncertainties
affecting its operations and financial condition, the Company does not intend to
review or revise any particular forward-looking statement referenced in this
Current Report in light of future events, even if new information, future events
or other circumstances have made them incorrect or misleading.
The information referred to above and in the Company's other Securities and
Exchange Commission (the "SEC") filings should be considered by investors when
reviewing any forward-looking statements contained in this report, in any
documents incorporated herein by reference, in any of the Company's public
filings or press releases or in any oral statements made by the Company or any
of its officers or any other persons acting on its behalf. For those statements,
the Company intends to avail itself of the protection of the safe harbor from
liability contained in the Private Securities Litigation Reform Act of 1995 with
respect to forward-looking statements.
The following table sets forth the percentage acquired (or to be acquired), the
gross leasable area (GLA) and closing dates for the Hahn Portfolio:
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
GLA
OWNERSHIP INTEREST (SQ. FEET) CLOSING
CENTER ACQUIRED (IN THOUSANDS) DATE
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Horton Plaza 100% 800 October 30, 1998
San Diego, CA
- -------------------------------------------------------------------------------------------------------
Parkway Plaza 100 1,030 September 25, 1998
El Cajon, CA
- -------------------------------------------------------------------------------------------------------
University Town Center 100 1,030 July 31, 1998
San Diego, CA
- -------------------------------------------------------------------------------------------------------
North County Fair 55 1,260 October 30, 1998
Escondido, CA
- -------------------------------------------------------------------------------------------------------
Santa Anita Fashion Park 39.7 1,100 September 25, 1998
Arcadia, CA
- -------------------------------------------------------------------------------------------------------
Los Cerritos Center 100 1,250 November 30, 1998*
Cerritos, CA
- -------------------------------------------------------------------------------------------------------
Fox Hills Mall 100 890 October 7, 1998
Culver City, CA
- -------------------------------------------------------------------------------------------------------
Valley Fair 50 1,140 July 31, 1998
San Jose, CA
- -------------------------------------------------------------------------------------------------------
Oakridge Mall 100 800 October 7, 1998
San Jose, CA
- -------------------------------------------------------------------------------------------------------
Solano Mall 100 1,010 September 25, 1998
Fairfield, CA
- -------------------------------------------------------------------------------------------------------
Downtown Plaza 100 1,170 October 30, 1998
Sacramento, CA
- -------------------------------------------------------------------------------------------------------
Capital Mall 50 600 October 7, 1998
Olympia, WA
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
*Projected closing date of the remaining 50% interest to be acquired. The original 50% interest was
acquired on July 21, 1998.
- -------------------------------------------------------------------------------------------------------
</TABLE>
(1) Instead of acquiring a 50% interest in Downtown Plaza as originally
anticipated in the Agreement, the Company acquired a 100% interest in such
property pursuant to Amendment No. 7 to the Agreement, dated October 30,
1998. This change in ownership has resulted in the Company acquiring a 100%
interest in eight shopping centers, instead of seven, and partial interests
in three shopping centers, instead of four. The effect of the additional
50% interest in Downtown Plaza is not reflected in and does not materially
affect the Pro Forma Financial information set forth below.
P-1
<PAGE>
The following table summarizes the total purchase price to be paid and sources
of funds to be used by the Company for purchase of the Hahn Portfolio pursuant
to the Agreement:
<TABLE>
<CAPTION>
Purchase price:
Real Estate Assets (in thousands)
- ---------------------
<S> <C>
Wholly-Owned Centers $1,064,891
Joint Venture Centers 319,000
Acquisition costs 36,323
----------
Total real estate assets purchased 1,420,214
Other Assets
- ------------
Purchase of 55% of North County Fair's
Non-real estate assets (net of
accrued liabilities assumed of $970) 1,869
----------
Total purchase price $1,422,083
==========
Sources of Funds:
Debt Sources
------------
Capital Notes $ 301,088
Wholly-Owned Centers debt assumed 103,691
Joint Venture Centers debt assumed 116,848
Secured Financing 400,955
Unsecured Financing 206,189
----------
Total debt funding 1,128,771
Equity Sources
--------------
Series C and D preferred shares 200,000
Other
-----
WHL warrants 99,670
Less: debt and equity issuance costs (6,358)
----------
Total sources of funds $1,422,083
==========
</TABLE>
P-2
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIAIRIES
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
JUNE 30, 1998
(UNAUDITED AND IN THOUSANDS)
The unaudited Pro Forma Condensed Consolidated Balance Sheet is presented
assuming the Company acquires the Wholly-Owned Centers, the Joint Venture
Centers and the remaining 55% interest in North County Fair that the Company
does not already own. For purposes of presenting the following unaudited Pro
forma Condensed Consolidated Balance Sheet it is assumed that (i) the Company
uses its proceeds from its sale of WHL shares received upon the exercise of the
WHL warrants totaling $99,670 towards the acquisition of the Hahn Portfolio,
(ii) the Company uses its proceeds from the issuance of unsecured subordinated
notes ("Capital Notes") totaling $301,088 towards the acquisition of the Hahn
Portfolio, (iii) the Company assumes existing mortgage debt totaling $193,352,
including the Company's proportionate share of Joint Venture debt totaling
$116,848, (iv) the Company assumes existing North County Fair mortgage debt
totaling $49,431, including the Company's proportionate share already
encumbered, (v) $206,189 is borrowed under unsecured financing ("Unsecured
Financing") provided by a consortium of banks led by Union Bank of Switzerland,
(vi) the Company borrows $400,955 under a secured loan ("Secured Financing")
obtained through a conduit lender and (vii) the Company issues $200,000 of
Series C and D Cumulative Convertible Preferred Stock ("Cumulative Convertible
Preferred Stock").
The unaudited Pro Forma Consolidated Balance Sheet should be read in conjunction
with the Consolidated Financial Statements of Westfield America, Inc. and
Subsidiaries included in the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1997 and Quarterly Reports on Forms 10-Q for the
calendar quarters ended March 31 and June 30, 1998, respectively. In the
Company's opinion, all adjustments necessary to reflect the effects of the
acquisition of the Hahn Portfolio, obtaining loan facilities, use of proceeds
from the issuance of Capital Notes and Cumulative Convertible Preferred Stock,
and sale of the WHL warrants to acquire the Hahn Portfolio have been made.
The unaudited Pro Forma Condensed Consolidated Balance Sheet is not necessarily
indicative of what the actual financial position of the Company would have been
at June 30, 1998 nor does it purport to present the future financial position of
the Company.
P-3
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIAIRIES
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
JUNE 30, 1998
(Unaudited and in Thousands)
<TABLE>
<CAPTION>
June 30, 1998
---------------------------------------------------------------
CONSOLIDATED PRO FORMA PRO FORMA
HISTORICAL (a) ADJUSTMENTS AS ADJUSTED
-------------- ------------ ------------
<S> <C> <C> <C>
ASSETS:
Net investment in real estate $1,971,620 $1,324,081 (b) $3,295,701
Cash and cash equivalents 8,067 707 (c) 8,774
Restricted cash 30,882 - 30,882
Accounts and notes receivable 28,432 2,474 (c) 30,906
Deferred expenses and other assets, net 25,013 7,589 (d) 32,602
---------- ---------- ----------
Total assets $2,064,014 $1,334,851 $3,398,865
========== ========== ==========
LIABILITIES:
Notes payable and revolving credit facility $1,176,059 $1,133,837 (e) $2,309,896
Accounts payable and accrued expenses 31,025 1,764 (c) 32,789
Distribution payable 28,758 - 28,758
Minority interest 23,986 - 23,986
---------- ---------- ----------
Total liabilities 1,259,828 1,135,601 2,395,429
---------- ---------- ----------
SHAREHOLDERS' EQUITY:
Common stock 731 - 731
Preferred stock 121,000 200,000 (f) 321,000
Paid-in-capital 648,769 (750) (g) 648,019
Retained earnings 33,686 - 33,686
---------- ---------- ----------
Total shareholders' equity 804,186 199,250 1,003,436
---------- ---------- ----------
Total liabilities and shareholders' equity $2,064,014 $1,334,851 $3,398,865
========== ========== ==========
</TABLE>
P-4
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIARIES
NOTES TO PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED AND IN THOUSANDS)
(a) Reflects Westfield America, Inc. and Subsidiaries consolidated unaudited
historical balance sheet at June 30, 1998.
<TABLE>
<S> <C>
(b) Increase reflects:
Acquisition of Wholly-Owned Centers $1,064,891
Acquistion of Joint Venture Centers (net of $116,848 which
represents the Company's proportionate share of assumed debt) 202,152
Consolidation of the Company's original 45%
investment in North County Fair at historic cost 20,715
Acquisition costs 36,323
----------
$1,324,081
==========
(c) Increase reflects North County Fair consolidation of
the Company's original 45% investment at historic value.
(d) Decrease reflects:
Deferred financing fees $ 5,608
Consolidation of the Company's original 45% investment in North
County Fair at historic cost 1,981
----------
$ 7,589
==========
(e) Reflects total additional borrowings to acquire the Hahn Portfolio
comprised of the following:
Assumption of North County Fair debt including the Company's
proportionate share already encumbered, interest at 13.5% $ 49,431
Secured Financing, interest at 6.67% 400,955
Unsecured Financing, interest at 7.0% 206,189
Mortgage debt assumed on Wholly-Owned Centers:
Los Cerritos Center, interest at 8.5% 37,873
Solano Mall, interest at 8.5% 38,631
Line of credit financing (including borrowings for temporary paydowns
of $301,088 and $99,670 for funds received from the Capital Notes
(interest at 8.38%) and sale of WHL warrants, respectively, to account
for paydowns previously described). 400,758
----------
$1,133,837
==========
</TABLE>
(f) Reflects issuance of Series C and D Cumulative Convertible Preferred Stock.
(g) Reflects equity issuance costs.
P-5
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIAIRIES
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND THE TWELVE MONTHS ENDED DECEMBER 31,
1997
(UNAUDITED AND IN THOUSANDS)
The unaudited Pro Forma Condensed Consolidated Statements of Income are
presented as if the Company acquired Wheaton Plaza Partnership for $51,500,
Annapolis Mall Partnership interest that the Company did not already own for
$133,000, Meriden Square Partnership interest that the Company did not already
own for $53,500, Northwest Plaza for $111,000 and Crestwood Plaza for $106,400
(the "Previously Acquired Centers") and the Company paid $1,422,083 to acquire
the Wholly-Owned Centers, Joint Venture Centers and the remaining 45% interest
in North County Fair that the Company does not already own from TrizecHahn
Centers, Inc. and one of TrizecHahn Centers Inc.'s joint venture partners as of
January 1, 1997. For purposes of presenting the following unaudited Pro forma
Condensed Consolidated Statements of Income it is assumed that (i) the Company
uses its proceeds from its sale of WHL shares received upon the exercise of the
WHL warrants totaling $99,670 (sold in April 1998, proceeds used to temporarily
paydown the Company's corporate line of credit) towards the acquisition of the
Hahn Portfolio, (ii) the Company uses its proceeds from the issuance of
unsecured subordinated notes ("Capital Notes") totaling $301,088 (issued in June
1998, proceeds used to temporarily paydown the Company's corporate line of
credit) towards the acquisition of the Hahn Portfolio, (iii) the Company assumes
existing mortgage debt totaling $193,352 including the Company's proportionate
share of Joint Venture debt totaling $116,848, (iv) the Company assumes existing
North County Fair mortgage debt totaling $49,431, including the Company's
proportionate share already encumbered, (v) $206,189 is borrowed under unsecured
financing ("Unsecured Financing") provided by a consortium of banks led by Union
Bank of Switzerland, (vi) the Company borrows $400,955 under a secured loan
obtained through a conduit lender, (vii) the Company issues $200,000 of Series C
and D Cumulative Convertible Preferred Stock ("Cumulative Convertible Preferred
Stock"), and (viii) the Company completed its May 1997 initial public offering
of 20,400 common shares and 270 preferred shares resulting in net proceeds
totaling $300,384 ("Offering") as of January 1, 1997.
The unaudited Pro Forma Consolidated Statements of Income should be read in
conjunction with the Consolidated Financial Statements of Westfield America,
Inc. and Subsidiaries included in the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1997 and Quarterly Reports on Forms 10-Q for
the calendar quarters ended March 31 and June 30, 1998, respectively. In the
Company's opinion, all adjustments necessary to reflect the effects of the
consummation of the acquisition of the Previously Acquired Centers and the Hahn
Portfolio, obtaining loan facilities, use of proceeds from the issuance of
Capital Notes and Cumulative Convertible Preferred Stock, and sale of the WHL
warrants to acquire the Hahn Portfolio have been made.
The unaudited Pro Forma Condensed Consolidated Statements of Income are not
necessarily indicative of what the actual results of operations of the Company
would have been assuming the transactions above had been consummated as of the
beginning of the year presented, nor do they purport to present the future
operations of the Company.
P-6
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIAIRIES
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(THOUSANDS EXCEPT FOR PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED JUNE 30, 1998
------------------------------------------------------------------
PRO FORMA PRO FORMA
HISTORICAL (a) ADJUSTMENTS CONSOLIDATED
-------------- ------------ --------------
<S> <C> <C> <C>
REVENUES:
Minimum and percentage rents $100,817 $ 40,407 (b) $141,224
Tenant recoveries 37,779 19,078 (b) 56,857
-------- -------- --------
Total revenues 138,596 59,485 198,081
-------- -------- --------
EXPENSES:
Operating 39,763 20,581 (b) 60,344
Management fees 2,770 1,274 (b) 4,044
Advisory fee 2,966 (2,407) (c) 559
General and administrative 901 - 901
Depreciation and amortization 33,878 9,435 (b) 43,313
-------- -------- --------
Total expenses 80,278 28,883 109,161
-------- -------- --------
OPERATING INCOME 58,318 30,602 88,920
Interest expense, net (39,202) (40,943) (d) (80,145)
Equity in income of unconsolidated real
estate partnerships 910 5,095 (e) 6,005
Gain on sale of investments 65,710 - 65,710
Interest and other income 7,440 - 7,440
-------- -------- --------
Income before minority interest 93,176 (5,246) 87,930
Minority interest in earnings of
consolidated real estate partnerships (1,978) - (1,978)
-------- -------- --------
NET INCOME $ 91,198 $ (5,246) $ 85,952
======== ======== ========
Net income allocable to preferred shares 5,447 13,642
Net income allocable to common shares 85,751 72,310
-------- --------
$ 91,198 $ 85,952
======== ========
EARNINGS PER SHARE
Basic $ 1.17 $ 0.99
======== ========
Diluted $ 1.06 $ 0.97
======== ========
</TABLE>
P-7
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIAIRIES
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS EXCEPT FOR PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31, 1997
------------------------------------------------------------------
PRO FORMA PRO FORMA
HISTORICAL (a) ADJUSTMENTS CONSOLIDATED
---------------- --------------- ----------------
REVENUES: (Audited) (Unaudited)
<S> <C> <C> <C>
Minimum and percentage rents $152,146 $ 122,452 (b) $ 274,598
Tenant recoveries 64,662 53,372 (b) 118,034
-------- --------- ---------
Total revenues 216,808 175,824 392,632
-------- --------- ---------
EXPENSES:
Operating 64,156 57,367 (b) 121,523
Management fees 4,074 3,914 (b) 7,988
Advisory fee - - (c) -
General and administrative 949 - 949
Depreciation and amortization 53,913 27,950 (b) 81,863
-------- --------- ---------
Total expenses 123,092 89,231 212,323
-------- --------- ---------
OPERATING INCOME 93,716 86,593 180,309
Interest expense, net (57,472) (101,773) (d) (159,245)
Equity in income of unconsolidated real
estate partnerships 3,887 6,292 (e) 10,179
Gain on sale of investments - 65,710 (f) 65,710
Interest and other income 9,212 4,959 (g) 14,171
-------- --------- ---------
Income before minority interest 49,343 61,781 111,124
Minority interest in earnings of
consolidated real estate partnerships (2,478) (1,330) (h) (3,808)
-------- --------- ---------
NET INCOME $ 46,865 $ 60,451 $ 107,316
======== ========= =========
Net income allocable to preferred shares 11,428 27,285
Net income allocable to common shares 35,437 80,031
-------- ---------
$ 46,865 $ 107,316
======== =========
EARNINGS PER SHARE INCOME(1)
Basic $ 0.54 $ 1.09
======== =========
Diluted $ 0.54 $ 1.08
======== =========
</TABLE>
P-8
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIAIRIES
NOTES TO PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED AND IN THOUSANDS EXCEPT FOR SHARE AMOUNTS)
(a) Reflects the Westfield America, Inc. and Subsidiaries unaudited and audited
Consolidated Statement of Income for the six months ended June 30, 1998 and
the year ended December 31, 1997, respectively.
(b) Reflects the historical operations of the Previously Acquired Centers and
the Hahn Portfolio as if these properties were acquired at the beginning of
each period presented. Additionally, management fees were adjusted to
reflect a payment equal to 5% of the minimum and percentage rents, and
depreciation expense was adjusted to reflect the new basis of the
properties based on purchase price.
(c) Effective July 1996, in conjunction with a reorganization of the Company, a
separate Advisory Agreement was entered into between the Company and
Westfield U.S. Advisory, L.P. ("Advisor") which provided for an advisory
fee. In connection with the Offering, the Advisory Agreement was amended
and the advisory fee was modified to be the lower of (i) 55 basis points of
the Company's net assets or (ii) a base amount of 25% of the Company's
funds from operations ("FFO"), as defined and was waived through December
31, 1997. The Company's Pro Forma Advisory Fee for the six months ended
June 30, 1998 is 25% of FFO in excess of the advisory FFO amount of
$130,419, on a Pro Forma basis.
(d) Reflects the increase in interest expense resulting from the following:
<TABLE>
<CAPTION>
SIX MONTHS YEAR ENDED
ENDED DECEMBER 31,
JUNE 30, 1998 1997
------------- ------------
<S> <C> <C>
Additional interest expense related to Previously
Acquired Centers $ 327 $ 19,857
Additional interest expense related to the 13,262 26,744
Secured Financing
Additional interest expense related to consolidated mortgage
debt assumed 3,248 6,666
Interest expense related to the Capital Notes 12,512 25,231
Additional interest expense related to the Unsecured
Financing 7,157 14,433
Additional interest expense related to North County Fair
mortgage loan assumed 3,391 6,752
Amortization of loan costs 1,046 2,090
------- --------
$40,943 $101,773
======= ========
</TABLE>
P-9
<PAGE>
WESTFIELD AMERICA, INC. AND SUBSIDIAIRIES
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME, CONTINUED
(UNAUDITED AND IN THOUSANDS EXCEPT FOR SHARE AMOUNTS)
(e) Reflects reduction in equity in income of unconsolidated real estate
partnerships due to the consolidation of Annapolis, Meriden and North
County Fair and increase in equity in income of unconsolidated Hahn
Properties.
(f) Reflects gain on sale of investments from the sale of WHL warrants.
(g) Reflects interest earned from the Garden State Plaza participating mortgage
loan.
(h) Reflects increase in minority interest from the consolidation of Wheaton
Plaza.
(i) Earnings per share are computed assuming the Offering was completed as of
January 1, 1997. The weighted average number of shares outstanding during
the six months ended June 30, 1998 and the year ended December 31, 1997 for
the purpose of computing pro forma earnings per share were as follows:
<TABLE>
<CAPTION>
SIX MONTHS Year
ENDED Ended
JUNE 30, December 31,
1998 1997
----------- ------------
<S> <C> <C>
Basic 73,336,000 73,336,000
========== ==========
Diluted 74,189,000 74,247,000
========== ==========
</TABLE>
For purposes of computing diluted earnings per share for the six months
ended June 30, 1998, and the year ended December 31, 1998, the Company's
preferred shares are excluded as their impact is antidilutive.
P-10
<PAGE>
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
WESTFIELD AMERICA, INC.
Date: November 13, 1998 /s/ Irv Hepner
_________________________
Irv Hepner
Secretary
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit No. Description of Exhibit*
- ----------- -----------------------
<C> <S>
10.1 Asset Purchase Agreement, dated as of April 6, 1998, between
TrizecHahn, and The Rouse Company and the Company,
incorporated herein by reference to Exhibit 10.1 to the
Company's Form 10-Q for the quarter ended June 30, 1998.
10.2 Amendment No. 1, dated as of July 31, 1998, between
TrizecHahn, and The Rouse Company and the Company,
incorporated herein by reference to Exhibit 10.2 to the
Company's Form 8-K dated July 31, 1998.
10.3 Amendment No. 2, dated as of August 31, 1998, between
TrizecHahn, and The Rouse Company and the Company,
incorporated herein by reference to Exhibit 10.3 to the
Company's Form 8-K dated September 25, 1998.
10.4 Amendment No. 3, dated as of September 23, 1998, between
TrizecHahn, and The Rouse Company and the Company,
incorporated herein by reference to Exhibit 10.4 to the
Company's Form 8-K dated September 25, 1998.
10.5 Amendment No. 4, dated as of September 25, 1998, between
TrizecHahn, and The Rouse Company and the Company,
incorporated herein by reference to Exhibit 10.5 to the
Company's Form 8-K dated September 25, 1998.
10.6 Amendment No. 5, dated as of October 7, 1998, between
TrizecHahn, and The Rouse Company and the Company,
incorporated herein by reference to Exhibit 10.6 to the
Company's Form 8-K dated September 25, 1998.
10.7 Amendment No. 6, dated as of October 22, 1998, between
TrizecHahn, and The Rouse Company and the Company.
10.8 Amendment No. 7, dated as of October 30, 1998, between
TrizecHahn, and The Rouse Company and the Company.
23.1 Consent of Independent Accountants - PricewaterhouseCoopers
LLP
23.2 Consent of Independent Auditors - KPMG Peat Marwick LLP
23.3 Consent of Independent Auditors - KPMG Peat Marwick LLP
99.1 Copy of the Press Release, dated November 2, 1998, issued
by the Company, publicly announcing the activities reported
therein.
</TABLE>
* Schedules and supplemental materials to the exhibits have been omitted but
will be provided to the SEC upon request.
<PAGE>
EXHIBIT 10.7
AMENDMENT NO. 6
AMENDMENT NO. 6, dated as of October 22, 1998 (this "Amendment"),
between TrizecHahn Centers Inc., a California corporation ("THCI"), The Rouse
Company, a Maryland corporation ("Rouse"), and Westfield America, Inc., a
Missouri corporation ("Westfield" and, together with Rouse the "Acquirors").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, THCI, Rouse and Westfield are parties to an Asset Purchase
Agreement, dated as of April 6, 1998, as amended by the following amendments:
Amendment No. 1 dated as of July 31, 1998, Amendment No. 2 dated as of August
31, 1998, Amendment No. 3 dated as of September 22, 1998, Amendment No. 4 dated
as of September 25, 1998, and Amendment No. 5 dated as of October 7, 1998
(together, the "Asset Purchase Agreement"; terms not otherwise defined herein
are defined in the Asset Purchase Agreement);
WHEREAS, THCI, Rouse and Westfield desire to further amend the Asset
Purchase Agreement as set forth in this Amendment; and
WHEREAS, pursuant to Section 12.09 of the Asset Purchase Agreement,
the Asset Purchase Agreement may be amended by the parties hereto.
NOW THEREFORE, in consideration of the premises and for other valuable
consideration, the receipt of which is hereby acknowledged, the parties hereto
hereby agree as follows:
ARTICLE I
AMENDMENTS TO THE PURCHASE AGREEMENT
SECTION 1.01. Towson Town Center. THCI and certain of its Affiliates are
now the owner of 100% of the partnership interests in Towson Town Center
Associates, a Maryland general partnership ("TTCA"). Pursuant to Articles of
Organization dated October 15, 1998 and filed on October 19, 1998, TTCA was
converted into Towson TC, LLC, a Maryland limited liability company ("Towson TC,
LLC "). The sole member of Towson TC, LLC is Towson Town Center Associates, a
Maryland general partnership formed on October 19, 1998 ("New TTCA"). New TTCA
shall constitute a "THCI Partnership" and Towson TC, LLC shall constitute a
"Partnership" for purposes of the Asset Purchase Agreement. In addition, the
100% membership interest held by New TTCA in Towson TC, LLC shall constitute a
"Partnership Interest" for purposes of the Asset Purchase Agreement. Towson Town
Center, Inc. a Delaware corporation, shall constitute a "THCI Subsidiary" for
purposes of Section 9.02(a)(iv) of the Asset Purchase Agreement. Section 1.01(A)
of the THCI Disclosure Schedule for the Towson Town Center Property (item P.) is
hereby amended by (i) under the Partnership column (in row P.), deleting "H-T
Associates" and substituting therefor "Towson TC, LLC", (ii) under the Second
Tier Partnership column (in row P.), deleting "Towson Town
-1-
<PAGE>
Center Associates", and (iii) under the Transfer of column (in row P.), deleting
"Property Assets" and substituting therefor "Partnership Interest in Towson TC,
LLC."
ARTICLE II
GENERAL PROVISIONS
SECTION 2.01. Authority; Effect on Asset Purchase Agreement.
(a) THCI hereby represents as follows:
(i) THCI has all necessary corporate power and authority to
execute and deliver this Amendment, to perform its obligations under the
Asset Purchase Agreement (as amended by this Amendment) and to consummate
the transactions contemplated by the Asset Purchase Agreement (as amended
by this Amendment).
(ii) The execution and delivery of this Amendment by THCI and
the consummation by THCI of the transactions contemplated by the Asset
Purchase Agreement have been duly and validly authorized by all necessary
corporate action and no other corporate proceedings on the part of THCI are
necessary to authorize this Amendment or to consummate the transactions
contemplated by the Asset Purchase Agreement (as amended by this
Amendment).
(iii) This Amendment has been duly and validly executed and
delivered by THCI and, assuming the due authorization, execution and
delivery by Rouse and Westfield, the Asset Purchase Agreement (as amended
by this Amendment) constitutes the legal, valid and binding obligation of
THCI, enforceable against THCI in accordance with its terms (except
insofar as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally, or principles governing the availability of equitable
remedies).
(b) Rouse and Westfield each, severally but not jointly, hereby
represents as follows:
(i) Such Acquiror has all necessary corporate power and
authority to execute and deliver this Amendment, to perform its obligations
under the Asset Purchase Agreement (as amended by this Amendment) and to
consummate the transactions contemplated by the Asset Purchase Agreement
(as amended by this Amendment).
(ii) The execution and delivery of this Amendment by such
Acquiror and the consummation by them of the transactions contemplated by
the Asset Purchase Agreement (as amended by this Amendment) have been duly
and validly authorized by all necessary corporate action and no other
corporate proceedings on the part of such
-2-
<PAGE>
Acquiror is necessary to authorize this Amendment or to consummate the
transactions contemplated by the Asset Purchase Agreement (as amended by
this Amendment).
(iii) This Amendment has been duly and validly executed and
delivered by such Acquiror and, assuming the due authorization, execution
and delivery by THCI, the Asset Purchase Agreement (as amended by this
Amendment) constitutes the legal, valid and binding obligation of such
Acquiror, enforceable against such Acquiror in accordance with its terms
(except insofar as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally, or principles governing the availability of equitable
remedies).
(c) Except as amended hereby, the provisions of the Asset Purchase
Agreement are and shall remain in full force and effect.
SECTION 2.02. Counterparts. This Amendment may be executed in two or more
counterparts, and by the different parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of this Amendment by telecopier shall be effective as delivery of a
manually executed counterpart of this Amendment.
SECTION 2.03. Governing Law. This Amendment shall be governed in the same
manner as provided in Section 12.10 of the Asset Purchase Agreement.
IN WITNESS WHEREOF, THCI, Rouse and Westfield have caused this Amendment to
be executed as of the date first written above by their respective officers
thereunto duly authorized.
TRIZECHAHN CENTER INC.
By: /s/ Neil Jacob
--------------------------------------------
Name: Neil Jacob
Title: Vice President
THE ROUSE COMPANY
By: /s/ Richard E. Galen
-------------------------------------------
Name: Richard E. Galen
Title: Vice President
WESTFIELD AMERICA, INC.
By: /s/ Irv Hepner
-------------------------------------------
Name: Irv Hepner
Title: Secretary
-3-
<PAGE>
EXHIBIT 10.8
AMENDMENT NO. 7
TO ASSET PURCHASE AGREEMENT
DATED AS OF APRIL 6, 1998
This AMENDMENT NO. 7 to Asset Purchase Agreement is, dated as of
October 30, 1998 (this "Amendment"), among TrizecHahn Centers Inc., a California
corporation ("THCI"), and The Rouse Company, a Maryland corporation ("Rouse"),
and Westfield America, Inc., a Missouri corporation ("Westfield" and, together
with Rouse the "Acquirors").
W I T N E S S E T H
- - - - - - - - - -
WHEREAS, THCI, Rouse and Westfield are parties to an Asset Purchase
Agreement, dated as of April 6, 1998 as amended by Amendment No. 1 dated as of
July 31, 1998, by the letter agreement dated as of July 31, 1998, by Amendment
No. 2 dated as of August 31, 1998, by Amendment No. 3 dated as of September 23,
1998, by Amendment No. 4 dated as of September 25, 1998, by Amendment No. 5,
dated as of October 7, 1998 and by Amendment No. 6 dated October 22, 1998 ( the
"Asset Purchase Agreement"; terms defined in the Asset Purchase Agreement and
not otherwise defined being used herein as therein defined);
WHEREAS, THCI, Rouse and Westfield desire to amend the Asset Purchase
Agreement as set forth in this Amendment; and
WHEREAS, pursuant to Section 12.09 of the Asset Purchase Agreement,
the Asset Purchase Agreement may be amended by the parties hereto.
NOW THEREFORE, in consideration of the premises and for other valuable
consideration, the receipt of which is hereby acknowledged, the parties hereto
hereby agree as follows;
ARTICLE I
AMENDMENTS TO THE ASSET PURCHASE AGREEMENT
SECTION 1.01 Amendment to Section 5.10(b) of the Asset Purchase
Agreement. Section 5.10(b) of the Asset Purchase Agreement is hereby amended and
restated as follows:
"(b)(1) THCI and the Acquirors acknowledge that Affiliates of THCI
entered into an agreement dated as of October 27, 1998 with all of the partners
in DPA, L.P. (all of such partners, excluding DPA, being the "DP Partners",)
pursuant to which THCI's Affiliates will acquire the limited partner interests
of the DP Partners in DPA, L.P. for an aggregate purchase price of $18,032,000
on the Applicable Closing Date for Downtown Plaza (and the general partner
interest of one DP Partner will be redeemed for $368,000 (the "Redeemed
Interest")) (the "THCI Purchase"). On the Applicable Closing Date for Downtown
Plaza, THCI shall cause to be
<PAGE>
sold to the Acquirors, and the Acquirors shall purchase from DPA, L.P., the
Downtown Plaza Property Assets for the Adjusted Allocated Purchase Price
therefor, in lieu of THCI selling and the Acquirors acquiring 100% of the stock
of DPA.
(2) The Acquirors and THCI agree that Canadian Imperial Bank of
Commerce ("CIBC"), holder of the Existing Debt on Downtown Plaza (the "CIBC
Loan"), has required payment of the following fees (each, a "CIBC Fee" and
collectively, the "CIBC Fees") in connection with the assumption by an affiliate
of Westfield of the CIBC Loan and the extension of the maturity date of the CIBC
Loan until June 2, 1999: (i) a fee of $184,952 on the Applicable Closing Date;
(ii) the Second Fee (as defined in the Assignment and Assumption, Release and
Modification of Loan Documents Agreement, dated as of the Applicable Closing
Date for Downtown Plaza); and (iii) CIBC may require the payment of attorneys'
fees and title endorsement fees in connection with such assumption. THCI agrees
to pay each CIBC Fee when due and the Acquirors shall reimburse THCI for 50% of
each such payment of a CIBC Fee on such Closing Date with respect to the
$184,952 CIBC Fee and, with respect to the other CIBC Fees, within five (5)
Business Days after THCI notifies the Acquirors that THCI has paid the subject
other CIBC Fee.
(3) The Acquirors acknowledge that the Guarantee of Indebtedness (the
"THCI Guaranty"), dated November 27, 1991 made by THCI in favor of CIBC of the
CIBC Loan will not be released on the Applicable Closing Date for Downtown
Plaza. Westfield hereby confirms that the terms of Section 5.05(d) shall
continue to apply to the THCI Guaranty. In addition to the foregoing, Westfield
agrees that if the THCI Guaranty has not been released prior to March 2, 1999,
Westfield shall on or prior to March 2, 1999 offer to CIBC its guaranty in
substitution of the THCI Guaranty in substantially the same form thereof and to
prepay $10,000,000 of the CIBC Loan in exchange for CIBC releasing the THCI
Guaranty, and if such offer is accepted by CIBC, Westfield shall make such
prepayment and deliver such guaranty (the "Replacement Guaranty") on the date
agreed to by CIBC. Such offer shall be unconditional and shall not be subject to
any other modification of the CIBC loan documents, except for the release of the
THCI Guaranty. In the event that Westfield fails to make such offer on or prior
to March 2, 1999, then THCI shall have the right, at any time thereafter, on
behalf of Westfield, to offer to CIBC a $10,000,000 prepayment of the CIBC Loan
and/or the Replacement Guaranty in exchange for CIBC releasing the THCI
Guaranty, and, if CIBC accepts such offer, (i) Westfield (if requested) will
deliver the Replacement Guaranty, (ii) conditioned only upon delivery of the
Replacement Guaranty, THCI shall make such prepayment to CIBC and (iii)
Westfield shall reimburse THCI for the full amount of such prepayment upon
demand the indemnity of Westfield hereunder shall apply to such reimbursement
obligation without regard to the Threshold Amount. Westfield agrees not to
extend or otherwise amend the CIBC Loan (as extended until June 2, 1999) or any
of the documents relating thereto unless the THCI Guaranty is released at the
time of such extension or amendment."
SECTION 1.02. Amendment to definition of "Adjusted Allocated Purchase
Price" in Section 1.01. Section 1.01 of the Asset Purchase Agreement is hereby
amended by adding the following at the end of the definition of "Adjusted
Allocated Purchase Price":
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<PAGE>
"(f) Notwithstanding clause (a) above, the Adjusted Allocated Purchase
Price for the Downtown Plaza Property Assets shall equal the sum of (i) Thirty-
six Million One Hundred Thousand Dollars ($36,100,000), plus or minus, as
applicable one hundred percent (100.0%) of the net amount of prorations made in
accordance with Section 2.07(a) for the Downtown Plaza Property Assets as of the
day preceding the Applicable Closing Date, plus (ii) Eighteen Million Four
Hundred Thousand Dollars ($18,400,000) which shall be used by THCI to consummate
the THCI Purchase, plus (iii) the Capital Costs paid on or prior to the
Applicable Closing by THCI or DPA, L.P., with respect to such property under
leases and construction contracts that are executed and delivered after the date
of this Agreement and renewals and extensions, exercised or executed after the
date of this Agreement, of leases executed on or prior to the date of this
Agreement, in each case in accordance with the terms of this Agreement, plus
(iv) the cash (net of outstanding payments) held by the Management Company for
the benefit of DPA, L.P., minus $700,000."
"(g) The "Adjusted Allocated Purchase Price" for Horton Plaza shall be
reduced by $75,000 on account of certain alleged defective floor covering work
performed at Horton Plaza."
SECTION 1.03. Completion of Performance of ADA Work. THCI agrees (i)
to cause, at no cost or expense to the Acquirors and in a good and workman-like
manner and in compliance with all Laws, the performance of the remediation
obligations of THCI and/or its Affiliates (the "Remediation Work") pursuant to
the settlement agreement relating to Civil Case Number S-96-1605 LKK/GGH
currently pending in United States District Court for the Eastern District of
California, and (ii) to keep Downtown Plaza free of liens arising from the
Remediation Work. THCI, DPA, L.P., DPA-H, Inc. and their respective agents and
contractors shall have the right to enter Downtown Plaza for the purpose of
completing the Remediation Work during reasonable and customary hours for the
performance of construction work of the same type and character as the
Remediation Work. THCI agrees to indemnify the Acquirors from and against any
and all losses, damages or claims suffered by the Acquirors as a result of any
such entry. Upon completion of the Remediation Work, THCI will cause the
assignment to the Acquirors without representation or warranty of any and all
express or implied warranties received from the contractors and their
subcontractors performing the Remediation Work.
SECTION 1.04. Amendment to Definition of "Excluded Property Assets" in
Section 101. Section 1.01 of the Asset Purchase Agreement is hereby amended by
adding the following at the end of the definition of "Excluded Property Assets":
"In addition, with respect to Horton Plaza only, the term
`Excluded Property Assets' shall also include (A) that certain
Standard Form of Agreement Between Owner and Contractor dated February
l2, 1998 by and between Hensel Phelps Construction Company and
HSD/Horton Associates, a California general partnership (the `Horton
Plaza Construction Contract') and the construction obligations
thereunder (the `Horton Plaza Construction Work')."
SECTION 1.05. Horton Plaza Construction Work. THCI agrees (i) to
cause, at no cost or expense to the Acquirors, the completion of that portion of
the Horton Plaza
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<PAGE>
Construction Work represented by the punch lists attached hereto as Exhibit "A"
(the "Horton Plaza Punchlist Work") in a good and workmanlike manner and in
compliance with all Laws and (ii) to keep Horton Plaza free of liens arising
from the Horton Plaza Punchlist Work. THCI, HSD Horton Associates and their
respective agents and contractors shall have the right to enter Horton Plaza for
the purpose of completing the Horton Plaza Punchlist Work during reasonable and
customary hours for the performance of construction work of the same type and
character as the Horton Plaza Punchlist Work. THCI agrees to indemnify the
Acquirors from and against any and all losses, damages or claims suffered by the
Acquirors as a result of any such entry. Upon completion of the Horton Plaza
Punchlist Work, THCI will assign or cause to be assigned to the Acquirors
without representation or warranty any and all express or implied warranties
received from the contractor and its subcontractors under the Horton Plaza
Construction Contract.
SECTION 1.06. Horton Plaza CAM Claim.
(a) THCI acknowledges that Nordstrom Inc. claims that HSD/Horton
Associates has over collected common area maintenance costs and merchants
association dues in the amount of $652,348 and that THCI is responsible for the
amount of any such over collection (and any interest thereon). THCI shall cause
HSD/Horton Associates to investigate the validity of such claim and use its
diligent efforts to resolve such claim in full to Nordstrom Inc.'s and
Westfield's reasonable satisfaction within thirty (30) days of the date hereof.
(b) If THCI has not resolved such claim to Nordstrom's and Westfield's
reasonable satisfaction by the earlier of (i) provided the Acquirors are not
then in breach of their obligation to close the acquisition of Los Cerritos
Mall, November 30, 1998, or (ii) the Applicable Closing Date for Los Cerritos
Mall, the Acquirors shall receive a credit against the Adjusted Allocated
Purchase Price for Los Cerritos Mall in the amount of such claim less the sum of
(i) any portion of such claim which THCI has paid and (ii) any portion of such
claim which THCI demonstrates to Westfield's reasonable satisfaction as being
without merit (or, if the Applicable Closing Date for Los Cerritos Mall has not
occurred by November 30, 1998, provided Acquirors are not then in breach of
their obligation to close the acquisition of Los Cerritos Mall, THCI shall pay
such amount to Westfield). Westfield agrees to promptly pay to Nordstrom, Inc.
the full amount of such credit or payment received by Westfield. Nothing
contained in this Section 1.06(b) shall limit THCI's responsibility for the
Nordstrom's claim or THC1's indemnification obligations with respect thereto
pursuant to Section 9.02(a)(iv) of the Agreement.
SECTION 1.07. Preliminary Adjustment of Prorations.
The word "prior" in Section 1.03 of Amendment No. 4 is hereby deleted
and replaced with "on or prior."
ARTICLE II
GENERAL PROVISIONS
SECTION 2.01. Authority; Effect on Asset Purchase Agreement.
(a) THCI hereby represents as follows:
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<PAGE>
(i) THCI has all necessary corporate power and authority to
execute and deliver this Amendment, to perform its obligations under the
Asset Purchase Agreement (as amended by this Amendment) and to consummate
the transactions contemplated by the Asset Purchase Agreement (as amended
by this Amendment).
(ii) The execution and delivery of this Amendment by THCI and
the consummation by THCI of the transactions contemplated by the Asset
Purchase Agreement (as amended by this Amendment) have been duly and
validly authorized by all necessary corporate action and no other corporate
proceedings on the past of THCI are necessary to authorize this Amendment
or to consummate the transactions contemplated by the Asset Purchase
Agreement (as amended by this Amendment).
(iii) This Amendment has been duly and va1idly executed and
delivered by THCI and, assuming the due authorization, execution and
delivery by Rouse and Westfield, the Asset Purchase Agreement (as amended
by this Amendment) constitutes the legal, valid and binding obligation of
THC1, enforceable against THCI in accordance with its terms (except insofar
as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization moratorium or similar laws affecting creditors' rights
generally, or principles governing the availability of equitable remedies).
(b) Rouse and Westfield each, severally but not jointly, hereby
represents as follows:
(i) Such Acquiror has all necessary corporate power and authority
to execute and deliver this Amendment, to perform its obligations under the
Asset Purchase Agreement (as amended by this Amendment) and to consummate
the transactions contemplated by the Asset Purchase Agreement (as amended
by this Amendment).
(ii) The execution and delivery of this Amendment by such
Acquiror and the consummation by them of the transactions contemplated by
the Asset Purchase Agreement (as amended by this Amendment) have been duly
and validly authorized by all necessary corporate action and no other
corporate proceedings on the part of such Acquiror are necessary to
authorize this Amendment or to consummate the transactions contemplated by
the Asset Purchase Agreement (as amended by this Amendment).
(iii) This Amendment has been duly and validly executed and
delivered by such Acquiror and, assuming the due authorization, execution
and delivery by THCI, the Asset Purchase Agreement (as amended by this
Amendment) constitutes the legal, valid and binding obligation of such
Acquiror, enforceable against such Acquiror in accordance with its terms
(except insofar as enforceability may be limited by applicable bankruptcy
insolvency, reorganization,
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<PAGE>
moratoriums or similar laws affecting creditors' rights generally, or
principles governing the availability of equitable remedies).
(c) Except as amended hereby, the provisions of the Asset Purchase
Agreement are and shall remain in full force and effect.
SECTION 2.02. Counterparts. This Amendment may be executed in two or
more counterparts, and by the different parties hereto in separate counterparts,
each of which when executed shall be deemed to be an original but all of which
taken together shall constitute one and the same agreement. Delivery of an
executed counterpart of this Amendment by telecopier shall be effective as
delivery of a manually executed counterpart of this Amendment.
SECTION 2.03. Governing Law. This Amendment shall be governed in the
same manner as provided in Section 12.10 of the Asset Purchase Agreement
[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]
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<PAGE>
IN WITNESS WHEREOF, THCI, Rouse and Westfield have caused this
Amendment to be executed as of the date first written above by their respective
officers hereunto duly authorized.
TR1ZECHAHN CENTERS INC.
By: /s/ Neil Jacob
---------------------------------------
Name: Neil Jacob
Title: Vice President
THE ROUSE COMPANY
By: /s/ Bruce I. Rothschild
---------------------------------------
Name: Bruce I. Rothschild
Title: Vice President
WESTFIELD AMERICA, INC.
By: /s/ Irv Hepner
---------------------------------------
Name: Irv Hepner
Title: Secretary
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<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statement of
Westfield America, Inc. on Form S-3 (File No. 333-52977) of our report dated
April 27, 1998, on our audit of the combined statement of revenues and certain
expenses of selected TrizecHahn Acquisition Properties to be acquired less than
100% by Westfield America, Inc. for the year ended December 31, 1997 and of our
report dated May 29, 1998, on our audit of the statement of revenues and certain
expenses of selected TrizecHahn Acquisition Properties to be acquired by
Westfield America, Inc. for the year ended December 31, 1997 which reports are
included in this filing on Form 8-K.
/s/ PRICEWATERHOUSECOOPERS LLP
Newport Beach, California
November 13, 1998
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors of Westfield America, Inc.,
the Managing General Partner of DPA, L.P.,
and the General Partner of Anita Associates:
We consent to the incorporation by reference in the registration statement (No.
333-52977) on Form S-3 of Westfield America, Inc. of our report dated May 27,
1998, with respect to the combined statement of revenue and certain expenses of
Downtown Plaza and Santa Anita Fashion Park for the year ended December 31,
1997, which report appears in the Form 8-K of Westfield America, Inc. dated
November 13, 1998 (date of earliest event reported, October 30, 1998). Such
report contains a paragraph that states that the combined statement of revenue
and certain expenses was prepared for the purpose of complying with the rules an
regulations of the Securities and Exchange Commission as described in Note 1. It
is not intended to be a complete presentation of Downtown Plaza and Santa Anita
Fashion Park's combined revenue and expenses.
/s/ KPMG Peat Marwick LLP
San Diego, California
November 13, 1998
<PAGE>
EXHIBIT 23.3
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors of Westfield America, Inc.,
the Managing General Partner of H and H Cerritos,
and the Managing General Partner of Oakridge Associates:
We consent to the incorporation by reference in the registration statement (No.
333-52977) on Form S-3 of Westfield America, Inc. of our report dated May 27,
1998, with respect to the combined statement of revenue and certain expenses of
Los Cerritos Center and Oakridge Mall for the year ended December 31, 1997,
which report appears in the Form 8-K of Westfield America, Inc. dated November
13, 1998 (date of earliest event reported, October 30, 1998). Such report
contains a paragraph that states that the combined statement of revenue and
certain expenses was prepared for the purpose of complying with the rules an
regulations of the Securities and Exchange Commission as described in Note 1. It
is not intended to be a complete presentation of Los Cerritos Center and
Oakridge Mall's combined revenue and expenses.
/s/ KPMG Peat Marwick LLP
San Diego, California
November 13, 1998
<PAGE>
EXHIBIT 99.1
FOR IMMEDIATE RELEASE
November 2, 1998
FOR MORE INFORMATION,
PLEASE CONTACT:
RANDALL J. SMITH, (310) 445-6822
WEBSITE: www.westfieldamerica.com
------------------------
WESTFIELD AMERICA, INC. (NYSE: WEA) ANNOUNCES ACQUISITION OF
DOWNTOWN PLAZA, HORTON PLAZA AND NORTH COUNTY FAIR.
Los Angeles, CA. November 2, 1998 - Westfield America, Inc. (NYSE:WEA) announced
that it has completed the acquisition of 100% interests in Downtown Plaza
located in Sacramento, CA and Horton Plaza in San Diego, CA, and a 55% interest
in North County Fair in Escondido, CA, giving WEA a 100% interest in North
County Fair. The interests in the three super regional centers were acquired
for approximately $454 million from TrizecHahn Corporation. With these
acquisitions Westfield America has purchased interests in eleven regional and
super regional shopping centers from TrizecHahn, of the twelve to be acquired.
The total acquisition cost for the portfolio will be approximately $1.4 billion
including the assumption of debt. The acquisition of TrizecHahn's interest in
Los Cerritos Center is scheduled for November, 1998.
Downtown Plaza is a super regional shopping center with 1,166,000 square feet
located in downtown Sacramento, CA, which is the state capital of California.
Downtown Plaza is anchored by two Macy's department stores and has 155 specialty
stores. The center also has 290,000 square feet of office building space.
Downtown Plaza's total sales were approximately $175 million in 1997, and the
specialty stores produced $289 per square foot. Downtown Plaza serves a high
number of daytime office workers and state government employees, and benefits
from its location adjacent to the "Old Sacramento" district, a major tourist
attraction.
Horton Plaza is a super regional shopping center with 800,000 square feet
located in downtown San Diego, CA. Horton Plaza is anchored by Nordstrom,
Macy's, and Mervyn's and has 140 specialty stores. Horton Plaza's total sales
were over $215 million in 1997, and the specialty stores produced $436 per
square foot. Horton Plaza is positioned to attract the visitor and convention
market in San Diego, and is one of the most successful downtown/urban shopping
centers in the U.S.
North County Fair is a super regional shopping center with 1,260,000 square feet
located in Escondido, CA. North County Fair is anchored by Nordstrom, Macy's,
two Robinsons-May stores, Sears, and JC Penney and has 168 specialty stores.
North County Fair's total sales in 1997 were approximately $280 million and the
specialty stores produced $337 per square foot. The center has excellent
visibility and access from Interstate 15 and serves the north San Diego County
market. Westfield America has owned a 45% interest in North County Fair since
1994, and the center will now be 100% owned by Westfield America.
Westfield America, Inc. (NYSE:WEA), a real-estate investment trust, is one of
the nation's leading owners of regional shopping centers. With this acquisition
the company owns interests in 37 major shopping centers, and after the
acquisition of the remaining TrizecHahn property, Los Cerritos Center, the
company will have interests in 38 major shopping centers. These centers comprise
35.2 million square feet of retail space in the states of California, Colorado,
Connecticut, Maryland, Missouri, New York, North Carolina, and Washington.
