EX-2.1 2 a16-10302_4ex2d1.htm EX-2.1

Exhibit 2.1

 

EXECUTION VERSION

 

MASTER COMBINATION AGREEMENT

 

by and among

 

NEW YORK REIT, INC.,

 

NEW YORK RECOVERY OPERATING PARTNERSHIP, L.P.,

 

JBG PROPERTIES INC.,

 

JBG/OPERATING PARTNERS, L.P.,

 

and

 

THE JAGUAR PARTIES SET FORTH ON SCHEDULE A

 

dated as of

 

May 25, 2016

 



 

TABLE OF CONTENTS

 

 

 

Page

 

 

 

ARTICLE I CONTRIBUTIONS AND MERGERS

3

Section 1.1.

Contribution of Included Assets and Mergers of the Jaguar Management Entities

3

Section 1.2.

Post-Closing Structuring

5

Section 1.3.

Consideration

6

Section 1.4.

Allocation of Consideration and Value Among the Included Assets and Giants Properties

6

Section 1.5.

Kickout of Included Interests

7

Section 1.6.

Distributions of Consideration to the Equityholders of the Jaguar Parties

7

Section 1.7.

Jaguar Representative

7

Section 1.8.

Withholding

9

 

 

 

ARTICLE II CLOSING

9

Section 2.1.

Closing

9

Section 2.2.

Deliveries by the Giants Parties at the Closing.

10

Section 2.3.

Deliveries by the Jaguar Parties at the Closing.

11

Section 2.4.

Giants Restricted Stock

12

 

 

 

ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE GIANTS PARTIES

12

Section 3.1.

Organization and Qualification; Subsidiaries

12

Section 3.2.

Organizational Documents

13

Section 3.3.

Capital Structure

14

Section 3.4.

Authority

15

Section 3.5.

No Conflict; Required Filings and Consents

16

Section 3.6.

SEC Filings; Financial Statements

18

Section 3.7.

Internal Controls

19

Section 3.8.

No Undisclosed Liabilities

19

Section 3.9.

Absence of Certain Changes or Events

20

Section 3.10.

Litigation

20

Section 3.11.

Labor and Other Employment Matters

20

Section 3.12.

Employee Benefit Plans

20

Section 3.13.

Taxes

21

Section 3.14.

Material Contracts

23

Section 3.15.

Environmental Matters

26

 

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Section 3.16.

Compliance with Laws; Permits

26

Section 3.17.

Intellectual Property

27

Section 3.18.

Properties

27

Section 3.19.

Approval Required

30

Section 3.20.

Opinion of Financial Advisor

30

Section 3.21.

Insurance

30

Section 3.22.

Information in the Proxy Statement and SEC Filings

30

Section 3.23.

WWP Joint Venture

31

Section 3.24.

Affiliate Transactions

31

Section 3.25.

Takeover Statutes

31

Section 3.26.

Brokers; Expenses

31

Section 3.27.

Termination of Related Party Agreements

32

Section 3.28.

Directors and Officers

32

Section 3.29.

No Other Representations or Warranties

32

 

 

 

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE JAGUAR PARTIES

33

Section 4.1.

Organization

33

Section 4.2.

Authorization; Validity of Agreement

34

Section 4.3.

No Conflict; Consents

35

Section 4.4.

Capital Structure; Subsidiaries

35

Section 4.5.

Securities Laws Matters

37

Section 4.6.

Financial Statements; Working Capital

40

Section 4.7.

No Undisclosed Liabilities

40

Section 4.8.

Absence of Certain Changes or Events

41

Section 4.9.

Jaguar Included Properties

41

Section 4.10.

Jaguar Development Properties

44

Section 4.11.

Personal Property

45

Section 4.12.

Litigation

45

Section 4.13.

Taxes

45

Section 4.14.

Compliance with Laws; Permits

48

Section 4.15.

Funds

49

Section 4.16.

Material Contracts

50

Section 4.17.

Environmental Matters

53

Section 4.18.

Bankruptcy

53

Section 4.19.

Employee Benefit Plans

54

Section 4.20.

Labor and Other Employment Matters

55

Section 4.21.

Intellectual Property

56

Section 4.22.

OFAC

56

 

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Section 4.23.

Patriot Act

56

Section 4.24.

Anti-Corruption

57

Section 4.25.

Insurance

57

Section 4.26.

Information in the Proxy Statement and SEC Filings

57

Section 4.27.

Brokers; Expenses

57

Section 4.28.

Directors

58

Section 4.29.

Roll-Forward Balance Sheet Matters

58

Section 4.30.

Non-Controlled Subsidiaries

58

Section 4.31.

No Other Representations or Warranties

58

 

 

 

ARTICLE V PRE-CLOSING COVENANTS

59

Section 5.1.

Access; Confidentiality; Notice of Certain Events

59

Section 5.2.

Consents and Approvals

60

Section 5.3.

Publicity

64

Section 5.4.

Conduct of Business by the Giants Parties

64

Section 5.5.

Conduct of Business by the Jaguar Parties Pending the Closing

69

Section 5.6.

Preparation of Proxy Statement; Giants Stockholder Meeting

72

Section 5.7.

Giants Acquisition Proposals

74

Section 5.8.

Credit Facility

78

Section 5.9.

Assistance with Credit Facility

80

Section 5.10.

Certain Pre-Closing Actions

81

Section 5.11.

Rule 3-14/Regulation S-X Cooperation

81

Section 5.12.

Jaguar Party Exclusivity

82

Section 5.13.

NYSE Listing

82

Section 5.14.

OPP Termination Agreement

83

Section 5.15.

Giants Board of Directors and Officers

83

Section 5.16.

Giants Charter and Partnership Agreement Amendment

83

Section 5.17.

REIT Ownership Waiver

84

Section 5.18.

Giants Officers Certificate

84

Section 5.19.

Jaguar Officers Certificate

84

Section 5.20.

Roll-Forward Balance Sheet Matters

85

 

 

 

ARTICLE VI ADDITIONAL AGREEMENTS

85

Section 6.1.

ROFRs and Tenant Estoppels under Ground Leases and Joint Venture Agreements

85

Section 6.2.

Casualty and Condemnation

86

Section 6.3.

Tax Matters

86

Section 6.4.

Jaguar Party Employee Matters

88

Section 6.5.

Directors’ and Officers’ Indemnification and Insurance

89

 

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Section 6.6.

Further Assurances

90

 

 

ARTICLE VII CONDITIONS TO CONSUMMATION OF THE TRANSACTIONS

91

Section 7.1.

Conditions to Each Party’s Obligations to Consummate the Transactions at the Closing

91

Section 7.2.

Conditions to Obligations of the Giants Parties

91

Section 7.3.

Conditions to Obligations of the Jaguar Parties

94

 

 

 

ARTICLE VIII TERMINATION

96

Section 8.1.

Termination

96

Section 8.2.

Effect of Termination

98

Section 8.3.

Termination Fee; Expense Reimbursement

98

 

 

 

ARTICLE IX MISCELLANEOUS

102

Section 9.1.

Amendment

102

Section 9.2.

Waiver

102

Section 9.3.

Non-Survival

102

Section 9.4.

Expenses

103

Section 9.5.

Notices

103

Section 9.6.

Certain Definitions

104

Section 9.7.

Terms Defined Elsewhere

118

Section 9.8.

Interpretation

121

Section 9.9.

Counterparts

122

Section 9.10.

Entire Agreement; Third-Party Beneficiaries

122

Section 9.11.

Severability

122

Section 9.12.

Governing Law; Jurisdiction

122

Section 9.13.

Waiver of Jury Trial

123

Section 9.14.

Assignment

123

Section 9.15.

Enforcement; Remedies

123

Section 9.16.

No Recourse

124

Section 9.17.

Joint and Several

124

 

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Schedules and Exhibits

 

Schedule A

 

Jaguar Funds

Schedule B

 

Cash Consideration

 

 

 

Exhibit A-1

 

Jaguar Included Properties

Exhibit A-2

 

Included Interests

Exhibit A-3

 

Managing Member Entities

Exhibit A-4

 

Excluded Properties

Exhibit B-1

 

Form of Contribution Agreement

Exhibit B-2

 

Form of Merger Agreement for Corporation

Exhibit B-3

 

Form of Merger Agreement for Partnership

Exhibit C

 

Form of Registration Rights Agreements

Exhibit D

 

Form of Partnership Agreement Amendment and Restatement

Exhibit E

 

Form of FIRPTA Certificate

Exhibit F

 

Form of Ownership Limit Waiver

Exhibit G

 

Form of Ground Lease Estoppel

Exhibit H

 

Form of Debt Maintenance Agreement

 

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MASTER COMBINATION AGREEMENT

 

This MASTER COMBINATION AGREEMENT (hereinafter referred to as this “Agreement”), dated as of May 25, 2016, is made by and among New York REIT, Inc., a Maryland corporation (“Giants”), New York Recovery Operating Partnership, L.P., a Delaware limited partnership and the operating partnership of Giants (the “Operating Partnership” and together with Giants, the “Giants Parties”), JBG Properties Inc., a Maryland corporation (“Jaguar Properties”), JBG/Operating Partners, L.P., a Delaware limited partnership (“Jaguar Operating Partners” and together with Jaguar Properties, the “Jaguar Management Entities”) and the Jaguar Properties affiliates listed on Schedule A (the “Jaguar Funds” and together with the Jaguar Management Entities, the “Jaguar Parties” and together with the Giants Parties, collectively, the “Parties”) .  All capitalized terms used in this Agreement shall have the meaning ascribed to such terms in Section 9.6 (Certain Definitions) or as otherwise defined elsewhere in this Agreement unless the context clearly provides otherwise.

 

RECITALS

 

WHEREAS, the Jaguar Parties and their affiliate entities are engaged in real estate investment, development, leasing and property management predominantly in the Washington D.C. metropolitan area;

 

WHEREAS, the Jaguar Funds own direct or indirect interests in the real properties set forth on Exhibit A-1 hereto (all such real property interests, together with all buildings, structures and other improvements and fixtures located on or under such real property and all easements, rights and other appurtenances benefitting such real property, collectively, the “Jaguar Included Properties”) through their ownership of the Equity Interests of the entities (the “Included Entities”) set forth on Exhibit A-2 hereto (collectively, the “Included Interests”);

 

WHEREAS, the entities listed on Exhibit A-3 hereto (the “Managing Member Entities”) act as the managing member in respect of certain Included Entities;

 

WHEREAS, the Jaguar Funds own direct or indirect interests in the real properties listed on Exhibit A-4 hereto (collectively, the “Excluded Properties”), which Excluded Properties will not be acquired by the Giants Parties (together with all other assets and properties of the Jaguar Funds other than the Included Assets, the “Excluded Assets”);

 

WHEREAS, prior to the Closing, each Jaguar Fund will engage in a restructuring through a series of steps pursuant to which, among other things, the Included Assets of certain of such Jaguar Funds will be transferred to a newly formed entity (each such newly formed entity, a “Wanted LLC”) to be owned indirectly by the members or partners of such Jaguar Fund, as applicable, through a newly formed entity (each such newly formed entity, a “Legacy LLC”);

 

WHEREAS, pursuant to the terms and subject to the conditions of this Agreement, the Parties desire to effectuate a series of transactions pursuant to which, among other things, the Jaguar Funds will contribute the Included Assets (or the Legacy LLCs will contribute the Wanted LLCs) to, the Managing Member Entities will contribute certain managing member

 



 

interests in the Included Assets to, and the Jaguar Management Entities will merge with and into, Giants, the Operating Partnership or their respective subsidiaries;

 

WHEREAS, as consideration for the contributions of the Included Assets and the Wanted LLCs, and the merger of the Jaguar Management Entities referenced above and more fully described below, (a) the applicable Giants Parties shall deliver to the applicable Jaguar Parties the Cash Consideration, (b) Giants shall issue to the applicable Jaguar Parties the Issued Giants Shares and/or shall contribute certain of the Issued Giants Shares to the Operating Partnership in exchange for an equal number of OP Units, and in turn the Operating Partnership shall deliver such Issued Giants Shares to the applicable Jaguar Parties, and (c) the Operating Partnership shall issue to the Jaguar Parties the Issued OP Units (the transactions contemplated under the preceding clauses (b) and (c), and any issuance of Giants Shares upon redemption of the Issued OP Units, being referred to herein as the “Equity Issuance”);

 

WHEREAS, the board of directors of Giants (the “Giants Board”) has (a) duly and validly authorized the execution and delivery of this Agreement and the direct or indirect acquisition of the Included Assets, the Equity Issuance, the Giants Charter Amendment, and the other transactions as contemplated by this Agreement (collectively, including with respect to the Jaguar Parties and their Affiliates, the Restructuring Transactions, the “Transactions”) to be effected by Giants and the Giants Subsidiaries, (b) directed that the Equity Issuance be submitted for consideration at a meeting of Giants’ stockholders and (c) resolved to recommend that Giants’ stockholders vote in favor of the approval of the Equity Issuance and (the “Giants Board Recommendation”) and to include such recommendation in the Proxy Statement;

 

WHEREAS, Giants in its capacity as the sole general partner of the Operating Partnership, on behalf of the Operating Partnership, has approved this Agreement and the direct or indirect acquisition of the Included Assets, the Equity Issuance, the Partnership Agreement Amendment and Restatement and the other Transactions to be effected by the Operating Partnership and its subsidiaries;

 

WHEREAS, each of the Jaguar Parties has received any requisite approval pursuant to its Governing Documents of the Restructuring Transactions, this Agreement, the contribution of the Included Assets and the other Transactions;

 

WHEREAS, concurrently with the execution and delivery of this Agreement, Jaguar Operating Partners and certain officers and directors of Giants have entered into that certain Support Agreement, dated as of the date hereof;

 

WHEREAS, concurrently with the execution and delivery of this Agreement, Giants, the Operating Partnership, New York Recovery Advisors, LLC (“Giants Advisor”) and New York Recovery Properties, LLC (“Giants Property Manager”) entered into a Termination Agreement and Release (the “Termination Agreement and Release”) in respect of which the parties thereto agreed to mutually release each other from certain claims under, among other agreements, the Giants Advisory Agreement, the Tax Indemnification Agreement and the Property Management Agreement and terminate the Tax Indemnification Agreement and the Property Management Agreement;

 

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WHEREAS, concurrently with the execution and delivery of this Agreement, Giants and the Operating Partnership have entered into a transition services agreement with Giants Advisor (the “Transition Services Agreement”), which Transition Services Agreement will be effective at the Closing;

 

WHEREAS, concurrently with the execution and delivery of this Agreement, Giants, the Operating Partnership and Giants Advisor have agreed to enter into the OPP Termination Agreement in order to amend the OPP Agreement to provide that at the Closing, the OPP Agreement and all Award LTIP Units (as defined in the OPP Agreement) issued thereunder shall terminate and be of no further force and effect in exchange for the consideration set forth therein; and

 

WHEREAS, the Giants Parties and the Jaguar Parties desire to make certain representations, warranties, covenants and agreements in connection with the Transactions and also prescribe various conditions to the Transactions as set forth herein.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained in this Agreement and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Parties agree as follows:

 

AGREEMENT

 

ARTICLE I

 

CONTRIBUTIONS AND MERGERS

 

Section 1.1.                                                         Contribution of Included Assets and Mergers of the Jaguar Management Entities.  Pursuant to the terms and subject to the conditions herein, and in reliance upon the representations, warranties and agreements herein:

 

(a)                                 Fund I Contribution.  At the Closing, JBG Investment Fund I, L.P. (“Fund I”) will contribute to the Operating Partnership all of its Included Interests with respect to the Jaguar Included Properties listed under “Fund I” on Section 1.1 of the Jaguar Disclosure Letter and all Included Assets related thereto pursuant to a contribution agreement substantially in the form attached hereto as Exhibit B-1 (such form, with all blanks completed and other applicable revisions made in a manner consistent with this Agreement being hereinafter referred to as the “Contribution Agreement”).

 

(b)                                 Fund II Contribution.  At the Closing, JBG Investment Fund II, L.P. (“Fund II”) will contribute to the Operating Partnership all of its Included Interests with respect to the Jaguar Included Properties listed under “Fund II” on Section 1.1 of the Jaguar Disclosure Letter and all Included Assets related thereto pursuant to the Contribution Agreement.

 

(c)                                  Fund III Contribution.  At the Closing, JBG Investment Fund III, L.P. (“Fund III”) will cause the Legacy LLC of Fund III to contribute to the Operating Partnership all of its Equity Interests in Fund III Wanted LLC (which will own all right, title and interest in and to the Included Interests with respect to the Jaguar Included Properties listed under “Fund III” on

 

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Section 1.1 of the Jaguar Disclosure Letter and all Included Assets related thereto and no other assets or properties) pursuant to the Contribution Agreement.

 

(d)                                 Fund VI Contribution.  At the Closing, JBG Investment Fund VI, L.L.C. (“Fund VI”) will cause the Legacy LLC of Fund VI to contribute to the Operating Partnership all of its Equity Interests in Fund VI Wanted LLC (which will own all right, title and interest in and to the Included Interests with respect to the Jaguar Included Properties listed under “Fund VI” on Section 1.1 of the Jaguar Disclosure Letter and all Included Assets related thereto and no other assets or properties) pursuant to the Contribution Agreement.

 

(e)                                  Fund VII Contribution.  At the Closing, JBG Investment Fund VII, L.L.C. (“Fund VII”) will cause the Legacy LLC of Fund VII to contribute to the Operating Partnership all of its Equity Interests in Fund VII Wanted LLC (which will own 100% of the outstanding common Equity Interests in Jaguar/Fund VII Trust (“Fund VII REIT”) and which together with Fund VII REIT will collectively own all right, title and interest in and to the Included Interests with respect to the Jaguar Included Properties listed under “Fund VII” on Section 1.1 of the Jaguar Disclosure Letter and all Included Assets related thereto and no other assets or properties) pursuant to the Contribution Agreement.

 

(f)                                   Fund VIII Contribution.  At the Closing, JBG Investment Fund VIII, L.L.C. (“Fund VIII”) will cause the Legacy LLC of Fund VIII to contribute to the Operating Partnership all of its Equity Interests in Fund VIII Wanted LLC (which will own 100% of the outstanding common Equity Interests in Jaguar/Fund VIII Trust (“Fund VIII REIT”) and which together with Fund VIII REIT will collectively own all right, title and interest in and to the Included Interests with respect to the Jaguar Included Properties listed under “Fund VIII” on Section 1.1 of the Jaguar Disclosure Letter and all Included Assets related thereto and no other assets or properties) pursuant to the Contribution Agreement.

 

(g)                                  Fund IX Contribution and Merger.  At the Closing, JBG Investment Fund IX, L.L.C. (“Fund IX”) will cause:

 

(i)                                     Fund IX Wanted LLC and Jaguar/Fund IX Trust (“Fund IX REIT”) to collectively own all right, title and interest in and to the Included Interests with respect to the Jaguar Included Properties listed under “Fund IX” on Section 1.1 of the Jaguar Disclosure Letter and all other Included Assets related thereto and no other assets or properties;

 

(ii)                                  Fund IX REIT to convert into a Maryland corporation and subsequently merge with and into a newly formed Delaware limited liability company wholly owned by Giants with the shareholders of Fund IX REIT receiving shares of Giants Common Stock as set forth in a merger agreement substantially in the form attached hereto as Exhibit B-2 (such form with all blanks completed and other applicable revisions made in a manner consistent with this Agreement being hereinafter referred to as the “Merger Agreement”); and

 

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(iii)                               the Legacy LLC of Fund IX to contribute to the Operating Partnership all of its Equity Interests in Fund IX Wanted LLC, pursuant to the Contribution Agreement.

 

(h)                                 UDM Contribution.  At the Closing, JBG/Urban Direct Member, L.L.C. (“UDM”) will cause the Legacy LLC of UDM to contribute to the Operating Partnership and its Subsidiary all of its Equity Interests (respectively, each class of Equity Interests) in UDM Wanted LLC (which will own all right, title and interest in and to the Included Interests listed under “UDM” on Section 1.1 of the Jaguar Disclosure Letter and all Included Assets related thereto and no other assets or properties) pursuant to the Contribution Agreement.

 

(i)                                     Recap Investors Contribution.  At the Closing, JBG/Recap Investors, L.L.C. (“Recap Investors”) will contribute to the Operating Partnership all of its Included Interests with respect to the Jaguar Included Properties listed under “Recap Investors” on Section 1.1 of the Jaguar Disclosure Letter and all Included Assets related thereto pursuant to the Contribution Agreement.

 

(j)                                    SEFC Investors and SEFC Partners Contributions.  At the Closing, (i) JBG/SEFC Fund Investors, L.L.C. (“SEFC Investors”) will contribute to the Operating Partnership all of its Included Interests with respect to the Jaguar Included Properties listed under “SEFC Investors” on Section 1.1 of the Jaguar Disclosure Letter and all Included Assets related thereto pursuant to the Contribution Agreement and (ii) JBG/SEFC Partners, L.L.C. (“SEFC Partners”) will contribute to the Operating Partnership all of its Included Interests with respect to the Jaguar Included Properties listed under “SEFC Partners” on Section 1.1 of the Jaguar Disclosure Letter and all Included Assets related thereto pursuant to the Contribution Agreement.

 

(k)                                 Management Company Combination Transactions.  At the Closing:

 

(i)                                     Jaguar Operating Partners will merge with and into a wholly owned limited liability company subsidiary of the Operating Partnership, with the partners of Jaguar Operating Partners receiving OP Units as set forth in a merger agreement substantially in the form attached hereto as Exhibit B-3 (such form with all blanks completed in a manner consistent with this Agreement being hereinafter referred to as the “Partnership Merger Agreement”);

 

(ii)                                  Jaguar Properties will merge with and into a newly formed Delaware limited liability company wholly owned by Giants, with the stockholders of Jaguar Properties receiving shares of Giants Common Stock pursuant to the Partnership Merger Agreement; and

 

(iii)                               The Jaguar Management Entities shall cause each Managing Member Entity to transfer and contribute any managing member interest it has in any Included Entity as set forth on Section 1.1 of the Jaguar Disclosure Letter (collectively, the “Managing Member Interests”) other than any Excluded Managing Member Interest, to a newly formed wholly owned subsidiary of the Operating Partnership pursuant to the Contribution Agreement.

 

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Section 1.2.                                                         Post-Closing Structuring.  Immediately following the Closing, Giants shall cause the actions set forth on Section 5.10 of the Jaguar Disclosure Letter that are contemplated to be taken after Closing to be implemented as set forth therein.

 

Section 1.3.                                                         Consideration.  The consideration to be delivered (or caused to be delivered) by Giants and the Operating Partnership to the applicable Jaguar Parties or one or more Persons designated by the Jaguar Parties to the Giants Parties in writing prior to the Closing (each, a “Jaguar Designee”) in connection with the transactions described in Section 1.1 shall consist of the Cash Consideration and the Equity Consideration as set forth below (collectively, the “Consideration”).

 

(a)                                 Cash Consideration.  The aggregate amount of cash to be delivered by the Giants Parties to the applicable Jaguar Parties and/or Jaguar Designees pursuant to the transactions described in Section 1.1 (the “Cash Consideration”) shall be determined in the manner described on Schedule B, subject to adjustment pursuant to Section 1.5; provided, that the aggregate Cash Consideration shall not exceed $20,000,000 without the approval of Giants.

 

(b)                                 Equity Consideration.  With respect to any shares of Giants Common Stock to be delivered by the Operating Partnership to the applicable Jaguar Parties and/or one or more Jaguar Designees, Giants shall contribute to the Operating Partnership and the Jaguar Parties (and/or Jaguar Designees, if applicable) shall receive from the Operating Partnership, newly-issued shares of Giants Common Stock, and with respect to any shares of Giants Common Stock to be issued by Giants directly to the Jaguar Parties or Jaguar Designees, Giants shall issue newly issued shares of Giants Common Stock (collectively, the “Issued Giants Shares”), which shall be validly issued, fully paid and non-assessable, and free and clear of all Liens (other than restrictions arising under applicable securities Laws and the Governing Documents of Giants), and which will be registered in the name of the applicable Jaguar Party (and/or Jaguar Designee) by book entry in an account or accounts with Giants’ transfer agent. The Operating Partnership shall issue to the Jaguar Parties (and/or Jaguar Designees, if applicable), and the Jaguar Parties (and/or Jaguar Designees, if applicable) shall receive from the Operating Partnership, a number of newly issued OP Units (collectively, the “Issued OP Units”), which shall be validly issued and free and clear of all Liens (other than restrictions arising under applicable securities Laws and the Governing Documents of the Operating Partnership).  The aggregate amount of shares of Giants Common Stock and OP Units to be delivered by the Giants Parties to the applicable Jaguar Parties and/or one or more Jaguar Designees, shall equal 319,908,191 shares of Giants Common Stock and/or OP Units minus the amount of shares of Giants Common Stock and/or OP Units determined in the manner described in Schedule B, subject to adjustment pursuant to Section 1.5 (the Issued Giants Shares, together with the Issued OP Units, the “Equity Consideration”), as applicable.

 

Section 1.4.                                                         Allocation of Consideration and Value Among the Included Assets and Giants Properties.  The Parties agree to cooperate in good faith to determine the allocation of the Cash Consideration and the Equity Consideration among each Legacy LLC, the Jaguar Management Entities and each of the Included Assets, as applicable, and the allocation of the Giants Valuation among each of the Giants Properties; provided, that if the Parties are unable to agree to the allocation of the Giants Valuation among each of the Giants Properties, such allocation shall be based on the relative value of each of the Giants Properties as determined for

 

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GAAP purposes in connection with the Transactions (the “Allocation”).  The Parties shall prepare and file their respective Tax Returns and any transfer Tax returns or other filings consistent with the Allocation and shall take no positions contrary thereto in any Tax Return or other Tax filing or proceeding unless otherwise required by applicable Law, provided, however, that nothing contained herein shall prevent the Giants Parties or the Jaguar Parties (or their respective Affiliates) from settling any proposed deficiency or adjustment by any Governmental Entity based upon or arising out of the Allocation, and neither the Giants Parties nor the Jaguar Parties (or their respective Affiliates) shall be required to litigate before any court any proposed deficiency or adjustment by any Governmental Entity challenging such Allocation.

 

Section 1.5.                                                         Kickout of Included Interests.  The Parties acknowledge that certain Included Interests may become Kickout Interests pursuant to Section 5.2(h). Notwithstanding anything to the contrary contained herein, no Kickout Interest shall be transferred at the Closing, and the Cash Consideration and Equity Consideration payable to the applicable Jaguar Fund that owns such Kickout Interest shall be reduced by an amount of cash, Issued Giants Shares and Issued OP Units set forth opposite such Kickout Interests on Section 1.5 of the Jaguar Disclosure Letter.

 

Section 1.6.                                                         Distributions of Consideration to the Equityholders of the Jaguar Parties.  The Jaguar Parties shall cause any Consideration received by the Jaguar Parties hereunder to be distributed in accordance with the respective Contribution Agreements and Merger Agreements, the Restructuring Transactions and the applicable Governing Documents of the Jaguar Parties and their respective Affiliates; provided, however, that any equityholder of a Jaguar Party that is not an accredited investor within the meaning of Rule 501 of Regulation D under the Securities Act shall only receive its applicable portion of the Cash Consideration and shall not receive any Equity Consideration.

 

Section 1.7.                                                         Jaguar Representative.

 

(a)                                 Each Jaguar Party (on behalf of itself, its Subsidiaries, its Jaguar Designees and their respective successors, assigns and heirs) hereby irrevocably appoints Jaguar Properties as the representative of the Jaguar Parties (the “Jaguar Representative”) and to be the agent, proxy and attorney-in-fact for such Person regarding any matter relating to or arising from this Agreement, any Ancillary Document or the Transactions, including the full power and authority on such Person’s behalf (i) to execute the Partnership Agreement Amendment and Restatement and any other Ancillary Documents and otherwise to consummate the transactions contemplated herein and therein, (ii) to pay such Person’s expenses incurred in connection with the negotiation and performance of this Agreement, the Ancillary Documents and any other agreement entered into in connection herewith (whether incurred on or after the date hereof), (iii) to disburse any funds received hereunder to the Jaguar Parties (as applicable), (iv) to endorse and deliver any certificates or instruments representing the Equity Consideration and execute such further agreements or instruments of assignment as the Giants Parties shall reasonably request or which the Jaguar Representative shall consider necessary or proper to effectuate the Transactions, all of which shall have the effect of binding the Jaguar Parties, their Subsidiaries and the Jaguar Designees as if such Person had personally executed such agreement or instrument, (v) to give and receive notices, communications and other deliverables hereunder or under any Ancillary Document on behalf of such Person, (vi) to take all other actions to be taken

 

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by or on behalf of such Person in connection herewith, including under any Ancillary Document, (vii) to dispute, compromise, settle and pay any claims made in connection with this Agreement or the Transactions, (viii) to retain legal and other professional advisors on behalf of, and at the expense of such Persons in connection with its actions hereunder and (ix) to take all actions necessary or appropriate in the judgment of the Jaguar Representative for the accomplishment of the foregoing.  Each Jaguar Party agrees that such agency, proxy and attorney-in-fact and all authority granted hereunder are coupled with an interest, and are therefore irrevocable without the consent of the Jaguar Representative and shall survive the death, incapacity, bankruptcy, dissolution or liquidation of any Person.  If, after the execution of this Agreement, any Jaguar Party, its Subsidiaries or its Jaguar Designee dies, dissolves or liquidates or becomes incapacitated or incompetent, then the Jaguar Representative is nevertheless authorized, empowered and directed to act in accordance with this Agreement as if that death, dissolution, liquidation, incapacity or incompetency had not occurred and regardless of notice thereof.  All actions, decisions or determinations so made or taken by the Jaguar Representative (to the extent authorized by this Agreement) shall be deemed the actions, decisions or determinations of each such Person, and any notice, communication, document, certificate or information required (other than any notice required by Law or under any Jaguar Party’s or its Subsidiaries’ Governing Documents) to be given to any Jaguar Party, its Subsidiaries or its Jaguar Designees hereunder or pursuant to any other agreement entered into in connection herewith shall be deemed so given if given to the Jaguar Representative.

 

(b)                                 Each Jaguar Party will severally, for itself, its Subsidiaries, and its Jaguar Designees only, and not jointly, indemnify the Jaguar Representative and hold the Jaguar Representative harmless against all expenses (including reasonable attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred without gross negligence or willful misconduct on the part of the Jaguar Representative and arising out of or in connection with the good faith acceptance or administration of its duties hereunder, and any act done or omitted pursuant to the advice of counsel will be conclusive evidence of such good faith.

 

(c)                                  The Jaguar Representative hereby accepts its appointment as representative of the Jaguar Parties under this Agreement.  The Jaguar Representative shall act in good faith.  Subject to the Jaguar Representative’s right to pay expenses reasonably incurred in connection with the negotiation and performance of this Agreement or otherwise to satisfy the reasonable expenses and obligations of the Jaguar Parties, their Subsidiaries and their Jaguar Designees, the Jaguar Representative shall promptly disburse to each Person such Person’s share of any Cash Consideration and Equity Consideration (as applicable) received by the Jaguar Representative in accordance with the terms of this Agreement.  The Jaguar Representative shall have only the duties expressly stated in this Agreement and shall have no other duty, express or implied.  The Jaguar Representative is not, by virtue of serving as the Jaguar Representative, a fiduciary of the Jaguar Parties or any other Person.  The Jaguar Representative, in his capacity as such, has no personal responsibility or liability for any representation, warranty or covenant of the Jaguar Parties.

 

(d)                                 The Jaguar Representative shall not be liable to any Jaguar Party or any other Person for any action taken or omitted by it or any agent employed by it hereunder or under any other document entered into in connection herewith, except that the Jaguar Representative shall not be relieved of any liability imposed by Law for fraud or bad faith.  The Jaguar

 

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Representative shall not be liable to the Jaguar Parties or any other Person for any apportionment or distribution of consideration made by the Jaguar Representative in good faith, and, if any such apportionment or distribution is subsequently determined to have been made in error, the sole recourse of any Person to whom payment was due, but not made, shall be to recover from other Jaguar Parties any payment in excess of the amount to which they are determined to have been entitled.  The Jaguar Representative shall not be required to make any inquiry concerning either the performance or observance of any of the terms, provisions or conditions of this Agreement.  Neither the Jaguar Representative nor any agent employed by it shall incur any liability to any Jaguar Party or any other Person by virtue of the failure or refusal of the Jaguar Representative for any reason to consummate the Transactions or relating to the performance of its other duties hereunder, except for actions or omissions constituting fraud or bad faith.

 

(e)                                  The Jaguar Representative shall not be entitled to and shall not charge or collect from the Jaguar Parties or any other Person any fees or other compensation for its services as the Jaguar Representative under this Agreement.  The Jaguar Representative, however, shall be entitled to reimbursement from the Jaguar Parties for its reasonable out-of-pocket expenses incurred in connection with its services as the Jaguar Representative under this Agreement.

 

(f)                                   If the Jaguar Representative resigns or is otherwise unable or unwilling to serve in such capacity, then the Jaguar Parties will appoint a new Person to serve as the Jaguar Representative and will provide prompt written notice thereof to Giants.  Until such notice is received, the Giants Parties will be entitled to rely on the actions and statements of the previous Jaguar Representative.

 

Section 1.8.                                                         Withholding.  Notwithstanding anything to the contrary in this Agreement, the Giants Parties shall be entitled to deduct and withhold from any amounts otherwise payable in connection with this Agreement and the Transactions to any Person such amounts as are required to be deducted and withheld under the Code or any provision of applicable Law.  Any amounts so withheld shall be paid over to the appropriate Governmental Entity to the extent required by Law.  To the extent that amounts are so deducted and withheld, such deducted and withheld amounts shall be treated for all purposes of this Agreement as having been paid to such Person in respect of whom such deduction and withholding were made.

 

ARTICLE II

 

CLOSING

 

Section 2.1.                                                         Closing.  The closing of the Transactions (the “Closing”) shall take place at the offices of Hogan Lovells US LLP, 555 Thirteenth Street NW, Washington, D.C. 20004, at 10:00 a.m. Eastern time on the second (2nd) Business Day following the satisfaction or waiver of all of the conditions set forth in Sections 7.1, 7.2 and 7.3 (other than those that by their terms are to be satisfied at the Closing, but subject to the satisfaction or waiver (by the Parties entitled to grant such waiver) of such conditions), or at such other place or on such other date as is mutually acceptable to the Giants Parties and the Jaguar Parties; provided, that notwithstanding the satisfaction or waiver of the closing conditions described in Sections 7.1, 7.2 and 7.3 (other than those that by their terms are to be satisfied at the Closing, but subject to the

 

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satisfaction or waiver (by the Parties entitled to grant such waiver) of such conditions), (a) the Jaguar Parties shall not be required to effect the Closing until the earlier of (i) the date on which all consents listed on Section 4.3 of the Jaguar Disclosure Letter have been obtained or (ii) the Outside Date, and (b) the Giants Parties shall not be required to effect the Closing until the October 28, 2016; provided, further, that if the satisfaction or waiver of the closing conditions described in Sections 7.1, 7.2 and 7.3 (other than those that by their terms are to be satisfied at the Closing, but subject to the satisfaction or waiver (by the Parties entitled to grant such waiver) of such conditions), has not occurred by November 15, 2016 and such conditions are subsequently satisfied or waived prior to December 31, 2016, then the Jaguar Parties shall have the right to defer the Closing until a date identified by the Jaguar Parties (by written notice to the Giants Parties at the time such conditions are satisfied or waived), but in no event later than January 18, 2017.  The date of the Closing hereunder is referred to herein as the “Closing Date” and the Closing will be deemed to have occurred at 12:01 a.m. Eastern time, on the date upon which the Closing occurs.

 

Section 2.2.                                                         Deliveries by the Giants Parties at the Closing.  Subject to the terms and conditions set forth herein, and on the basis of the representations, warranties, covenants and agreements set forth herein, at the Closing, the applicable Giants Party shall deliver, or cause to be delivered, to the Jaguar Parties (and/or the Jaguar Designees, as applicable):

 

(a)                                 the Cash Consideration by wire transfer of immediately available funds to the account(s) designated by the Jaguar Parties in writing at least two (2) Business Days prior to the Closing Date;

 

(b)                                 evidence of the issuance of the Giants Common Stock and OP Units to the Jaguar Parties (and/or Jaguar Designees, as applicable) issuable pursuant to Section 1.3(b);

 

(c)                                  The Contribution Agreements referenced in Section 1.1 and the Merger Agreements referenced in Section 1.1, duly executed by Giants or its applicable Subsidiary;

 

(d)                                 Registration Rights Agreements, in the forms attached hereto as Exhibit C (the “Registration Rights Agreements”), duly executed by Giants;

 

(e)                                  an amendment and restatement of the Partnership Agreement in the form attached hereto as Exhibit D (the “Partnership Agreement Amendment and Restatement”), duly executed by Giants in its capacity as the sole general partner of the Operating Partnership and as the attorney-in-fact for the other partners of the Operating Partnership, and effective as of the Closing;

 

(f)                                   Ownership Limit Waiver Agreements, to the extent necessary and in accordance with Section 5.17, duly executed by Giants;

 

(g)                                  a certificate executed by a duly authorized officer of Giants pursuant to Section 7.3(e);

 

(h)                                 the Giants REIT Opinion;

 

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(i)                                     any transfer Tax returns as may be necessary to comply with Article 31 of the Tax Law of the State of New York and the regulations applicable thereto, and the New York City Real Property Transfer Tax Law (Admin. Code Article 21) and the regulations applicable thereto and any other required transfer Tax declarations or similar documentation required to evidence the payment of any Tax imposed by any state, county or municipality together with any change of ownership statements required under any legal requirements;

 

(j)                                    the Debt Maintenance Agreement, duly executed by Giants;

 

(k)                                 the Payoff Letter; and

 

(l)                                     all documents, items or agreements required to be delivered by the Giants Parties or their Affiliates under the Merger Agreements and the Contribution Agreements.

 

Section 2.3.                                                         Deliveries by the Jaguar Parties at the Closing.  Subject to the terms and conditions set forth herein, and on the basis of the representations, warranties, covenants and agreements set forth herein, at the Closing, the applicable Jaguar Party shall deliver, or cause to be delivered, to the Giants Parties:

 

(a)                                 the Registration Rights Agreements, duly executed by each of the Jaguar Parties (and/or Jaguar Designees, as applicable);

 

(b)                                 a counterpart signature page to the Partnership Agreement Amendment and Restatement and all other documents or instruments as required by the terms of the Partnership Agreement for the admission of the Jaguar Parties (and/or Jaguar Designees, as applicable) as limited partners of the Operating Partnership;

 

(c)                                  a certificate executed by a duly authorized officer of each of the Jaguar Parties or its general partner or manager pursuant to Section 7.2(e);

 

(d)                                 a certificate duly completed and executed by each of the transferor Jaguar Parties, dated as of the Closing Date, certifying in accordance with Section 1445 of the Code that each such Jaguar Party (or, if such Jaguar Party is a disregarded entity for U.S. federal income tax purposes, the Person treated as the owner of such Jaguar Party’s assets for such purposes) is not a “foreign person” within the meaning of such section, in substantially the form of Exhibit E hereto (“FIRPTA Certificate”);

 

(e)                                  an Internal Revenue Service Form W-9 or relevant Form W-8, as applicable, completed and executed by each Jaguar Party or Affiliate directly receiving Equity Consideration pursuant to this Agreement;

 

(f)                                   any transfer Tax returns as may be necessary to comply with Title 42, Subtitle 1, Chapter 11 of the District of Columbia Code and the regulations applicable thereto, and Titles 12 and 13 of the Maryland TAX-PROPERTY Code and the regulations applicable thereto and any other required transfer Tax declarations or similar documentation required to evidence the payment of any Tax imposed by any state, county or municipality together with any change of ownership statements required under any legal requirements;

 

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(g)                                  the Jaguar REIT Opinions; and

 

(h)                                 all documents, items or agreements required to be delivered by the Jaguar Parties or their Affiliates under the Merger Agreements and the Contribution Agreements.

 

Section 2.4.                                                         Giants Restricted Stock.  At or immediately prior to the Closing, Giants shall cause each share of Giants Restricted Stock granted pursuant to a Giants Stock Plan that is outstanding immediately prior to the Closing to, automatically upon the consummation of the Closing and without any required action on the part of the holder thereof, cease to be subject to any forfeiture or vesting conditions.

 

ARTICLE III

 

REPRESENTATIONS AND WARRANTIES
OF THE GIANTS PARTIES

 

The following representations and warranties by the Giants Parties set forth in this Article III are qualified in their entirety by reference to the disclosures (i) in the publicly available Giants SEC Filings filed or furnished on or after January 1, 2015 and prior to the second Business Day preceding the date hereof (including any filings incorporated by reference therein, but excluding any risk factor disclosures contained in such documents under the heading “Risk Factors” and any disclosures of risks or other matters included in any “forward-looking statements” disclaimer); provided, however, that the disclosures in the Giants SEC Filings shall not be deemed to qualify the representations and warranties made in Sections 3.1(a) and (c) (Organization and Qualification; Subsidiaries), Section 3.2 (Organizational Documents), Section 3.4 (Authority), Section 3.5 (No Conflict; Required Filings and Consents), and Section 3.26 (Brokers; Expenses) and (ii) set forth in the disclosure letter delivered by the Giants Parties to the Jaguar Parties immediately prior to the execution of this Agreement (the “Giants Disclosure Letter”).  Each disclosure set forth in the Giants Disclosure Letter shall qualify or modify the Section to which it corresponds and any other Section to the extent the applicability of the disclosure to each other Section is reasonably apparent from the text of the disclosure made.

 

Section 3.1.                                                         Organization and Qualification; Subsidiaries.

 

(a)                                 Giants is a corporation duly organized, validly existing and in good standing under the laws of the State of Maryland and has the requisite organizational power and authority and any necessary governmental authorization to own, lease and, to the extent applicable, operate its properties and to carry on its business as it is now being conducted.  Giants is duly qualified or licensed to do business, and is in good standing, in each jurisdiction where the character of the properties owned, operated or leased by it or the nature of its business makes such qualification, licensing or good standing necessary, except for such failures to be so qualified, licensed or in good standing that, individually or in the aggregate, have not had and would not reasonably be expected to have a Giants Material Adverse Effect.

 

(b)                                 Each Giants Subsidiary is duly incorporated or organized, validly existing and in good standing under the Laws of the jurisdiction of its incorporation or organization, as

 

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the case may be, and has the requisite organizational power and authority and any necessary governmental authorization to own, lease and, to the extent applicable, operate its properties and to carry on its business as it is now being conducted, except, with respect only to each Giants Subsidiary other than the Operating Partnership, for such failures to be so organized, in good standing or have certain power and authority that, individually or in the aggregate, have not had and would not reasonably be expected to have a Giants Material Adverse Effect.  Each Giants Subsidiary is duly qualified or licensed to do business, and is in good standing, in each jurisdiction where the character of the properties owned, operated or leased by it or the nature of its business makes such qualification, licensing or good standing necessary, except for such failures to be so qualified, licensed or in good standing that, individually or in the aggregate, have not had and would not reasonably be expected to have a Giants Material Adverse Effect.

 

(c)                                  Section 3.1(c) of the Giants Disclosure Letter sets forth a true and complete list of the Giants Subsidiaries and each other corporate or other entity in which Giants owns any direct or indirect voting, capital, profits or other beneficial interest (“Other Giants Subsidiary”), including a list of each Giants Subsidiary or Other Giants Subsidiary that is a “qualified REIT subsidiary” within the meaning of Section 856(i)(2) of the Code (“Qualified REIT Subsidiary”), a “taxable REIT subsidiary” within the meaning of Section 856(l) of the Code (“Taxable REIT Subsidiary”) or a real estate investment trust within the meaning of Sections 856 — 860 of the Code (“REIT”), together with (i) the jurisdiction of incorporation or organization, as the case may be, of each Giants Subsidiary and each Other Giants Subsidiary, (ii) the type of and percentage of voting, equity, profits, capital and other beneficial interest held, directly or indirectly, by Giants in and to each Giants Subsidiary and each Other Giants Subsidiary, (iii) the names of and the type of and percentage of voting, equity, profits, capital and other beneficial interest held by any Person other than Giants or a Giants Subsidiary in each Giants Subsidiary and, to the knowledge of Giants, each Other Giants Subsidiary, and (iv) the classification for U.S. federal income tax purposes of each Giants Subsidiary and, to the knowledge of Giants, each Other Giants Subsidiary.

 

(d)                                 Neither Giants nor any Giants Subsidiary directly or indirectly owns any interest or investment (whether equity or debt) in any Person (other than the equity interests in the Giants Subsidiaries and Other Giants Subsidiaries and investments in bank time deposits or money market accounts).

 

(e)                                  Except as set forth in Section 3.1(e) of the Giants Disclosure Letter, Giants has not exempted any “Person” from the “Aggregate Share Ownership Limit” or established or increased an “Excepted Holder Limit,” as such terms are defined in the Giants Charter, which exemption or Excepted Holder Limit is currently in effect.

 

(f)                                   Section 3.1(f) of the Giants Disclosure Letter sets forth a complete list of the partners of the Operating Partnership and the number of partnership units held by each partner in the Operating Partnership.  Giants is the sole general partner of the Operating Partnership.

 

Section 3.2.                                                         Organizational Documents.  Giants has made available to the Jaguar Parties complete and correct copies of (i) Giants’ charter (the “Giants Charter”) and Giants’ bylaws, as amended to date (the “Giants Bylaws”), and (ii) the organizational documents of each

 

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Giants Subsidiary, each as in effect on the date hereof, including the certificate of limited partnership of the Operating Partnership and the Partnership Agreement.  Giants is in compliance with the terms of the Giants Charter and the Giants Bylaws in all material respects.  The Operating Partnership is in compliance with the terms of the certificate of limited partnership of the Operating Partnership and the Partnership Agreement in all material respects.

 

Section 3.3.                                                         Capital Structure.

 

(a)                                 The authorized capital stock of Giants consists of 300,000,000 shares of common stock, $0.01 par value per share (the “Giants Common Stock”), and 50,000,000 shares of preferred stock, $0.01 par value per share (the “Giants Preferred Stock”).  At the close of business on May 25, 2016, (i) 165,128,055 shares of Giants Common Stock were issued and outstanding (including 258,697 shares of unvested Giants Restricted Stock), (ii) approximately 17,105,263 shares of Giants Common Stock were available for issuance under the Giants Stock Plans and (iii) 10,448,604 shares of Giants Common Stock were reserved for issuance upon conversion of any partnership units.  All issued and outstanding shares of the capital stock of Giants are duly authorized, validly issued, fully paid and non-assessable, and no class of capital stock of Giants is entitled to preemptive rights.  There are no outstanding bonds, debentures, notes or other indebtedness of Giants having the right to vote (or convertible into, or exchangeable for, securities having the right to vote) on any matter on which holders of shares of Giants Common Stock may vote.  Section 3.3(a) of the Giants Disclosure Letter sets forth for each holder of Giants Restricted Stock outstanding as of the date of this Agreement (A) the name with respect to the holder, (B) the aggregate number of shares of Giants Restricted Stock held by all such holders, (C) the date of grant of such Giants Restricted Stock, and (D) the vesting schedule for such Giants Restricted Stock.  There are no other rights, options, stock or unit appreciation rights, phantom stock or units, restricted stock units, dividend equivalents or similar rights with respect to the Giants Common Stock.  No grants or awards have been made under the Giants Stock Plans other than grants of Giants Restricted Stock, and each Giants Restricted Stock grant was made in accordance with the terms of the Giants Stock Plans and applicable Law in all material respects.  Prior to the Closing (and as close to Closing as reasonably practicable), Giants will provide to the Jaguar Parties a complete and correct list that contains the information required to be provided in Section 3.3(a) of the Giants Disclosure Letter, that is correct and complete as of the date such list is provided; provided, however, that delivery of such updated schedule shall not cure any breach of this Section 3.3(a) for purposes of determining whether the applicable closing condition has been satisfied.

 

(b)                                 Section 3.3(b) of the Giants Disclosure Letter sets forth, a list of all of the partners of the Operating Partnership, together with the number of OP Units held by each such partner.  At the close of business on May 25, 2016, there are (i) 1,568,025 OP Units issued and outstanding, (ii) zero Class B Units issued and outstanding and (iii) 8,880,579 LTIP Units issued and outstanding (which includes 1,172,738 earned LTIP Units and 7,707,841 unearned LTIP Units), each of which LTIP Units is owned of record and beneficially by the Persons set forth on Section 3.3(b) of the Giants Disclosure Letter, and each of which LTIP Units shall be forfeited immediately prior to the Closing.  Except as set forth in the preceding sentence, there are no other partnership interests or other equity or ownership interests in the Operating Partnership and there are no existing options, warrants, calls, subscriptions, convertible securities or other securities, agreements, commitments or obligations of any character relating to the partnership

 

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interests or other equity or ownership interests in the Operating Partnership or other securities, in each case, which would require the Operating Partnership to issue or sell any partnership interests or other equity or ownership interests in the Operating Partnership.  No grants or awards have been made under the OPP Agreement other than the grants of LTIP Units and each LTIP Unit grant was made in accordance in all material respects with the terms of the OPP Agreement, the Partnership Agreement and applicable Law.

 

(c)                                  All the outstanding shares of capital stock of each of the Giants Subsidiaries that is a corporation are duly authorized, validly issued, fully paid and non-assessable.  All Equity Interests in each of the Giants Subsidiaries that is a partnership or limited liability company are duly authorized and validly issued.  All shares of capital stock of (or other ownership interests in) each of the Giants Subsidiaries that may be issued upon exercise of outstanding options or exchange rights are duly authorized and, upon issuance, will be validly issued, fully paid and non-assessable.  Except as set forth in Section 3.3(c) of the Giants Disclosure Letter, Giants owns, directly or indirectly, all of the issued and outstanding capital stock and other ownership interests of each of the Giants Subsidiaries, free and clear of all encumbrances other than statutory or other liens for Taxes or assessments which are not yet due or delinquent or the validity of which is being contested in good faith by appropriate proceedings and for which adequate reserves are maintained on Giants’ financial statements in accordance with GAAP to the extent required under GAAP and there are no existing options, warrants, calls, subscriptions, convertible securities or other securities, agreements, commitments or obligations of any character relating to the outstanding capital stock or other securities of any Giants Subsidiary or which would require any Giants Subsidiary to issue or sell any shares of its capital stock, ownership interests or securities convertible into or exchangeable for shares of its capital stock or ownership interests.

 

(d)                                 Except as set forth in this Agreement or in Section 3.3(d) of the Giants Disclosure Letter and except as set forth in the OPP Termination Agreement, as of the date of this Agreement, there are no securities, options, warrants, calls, rights, commitments, agreements, rights of first refusal, arrangements or undertakings of any kind to which Giants or any Giants Subsidiary is a party or by which any of them is bound, obligating Giants or any Giants Subsidiary to issue, deliver or sell or create, or cause to be issued, delivered or sold or created, additional shares of Giants Common Stock, shares of Giants Preferred Stock, any partnership units or other Equity Interests or phantom stock or other contractual rights the value of which is determined in whole or in part by the value of any equity security of Giants or any Giants Subsidiaries or obligating Giants or any Giants Subsidiary to issue, grant, extend or enter into any such security, option, warrant, call, right, commitment, agreement, right of first refusal, arrangement or undertaking.  Except as set forth in Section 3.3(d) of the Giants Disclosure Letter, as of the date of this Agreement, there are no outstanding contractual obligations of Giants or any Giants Subsidiary to repurchase, redeem or otherwise acquire any shares of Giants Common Stock or other equity securities of Giants or any Giants Subsidiary (other than pursuant to the Partnership Agreement or in satisfaction of withholding Tax obligations pursuant to certain awards outstanding under the Giants Stock Plans in the event the grantees otherwise fail to satisfy withholding Tax obligations).  Neither Giants nor any Giants Subsidiary is a party to or bound by any agreements or understandings concerning the voting (including voting trusts and proxies) of any capital stock of Giants or any Giants Subsidiaries.

 

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Section 3.4.                                                         Authority.

 

(a)                                 Each of the Giants Parties has all necessary corporate or limited partnership power and authority, as applicable, to execute and deliver this Agreement, and each Ancillary Document to be executed and delivered by it at the Closing, to perform its obligations hereunder and thereunder, and, subject to receipt of the Giants Stockholder Approval, to consummate the Transactions.  The execution, delivery and performance by the Giants Parties of this Agreement and the execution, delivery and performance by such Giants Party of each Ancillary Document to which such Giants Party is or will be a party and the consummation by the Giants Parties of the Transactions have been duly and validly authorized by all necessary corporate and limited partnership action, and no other corporate or limited partnership proceedings on the part of the Giants Parties, as applicable, are necessary to authorize the execution and delivery by any Giants Party of this Agreement, any such Ancillary Document and the consummation by it of the Transactions, subject to receipt of the Giants Stockholder Approval and the filing with and acceptance by, the applicable Governmental Entity, of any certificate or articles of merger for any merger contemplated by the Transactions.  This Agreement has been, and each Ancillary Document to which it is or will be contemplated that such Giants Party will be party is or will be, duly executed and delivered by such Giants Party (as applicable) and, assuming due and valid authorization, execution and delivery hereof and thereof by such Giants Parties party thereto, is or will be a valid and binding obligation of such Giants Party, enforceable against such Giants Party in accordance with its terms, except as the enforcement hereof or thereof may be limited by (i) bankruptcy, insolvency, reorganization, moratorium or other similar Laws, now or hereafter in effect, relating to creditors’ rights generally and (ii) general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at Law).

 

(b)                                 The Giants Board, at a duly held meeting, has (i) duly and validly authorized the execution and delivery of this Agreement and each Ancillary Document to be executed and delivered by such Giants Party at the Closing and declared advisable and in the best interests of Giants the consummation of the Transactions, (ii) directed that the Equity Issuance be submitted for consideration at the Giants Stockholder Meeting, and (iii) resolved to recommend that the stockholders of Giants vote in favor of the approval of the Equity Issuance and to include such recommendation in the Proxy Statement, which resolutions remain in full force and effect and have not been subsequently rescinded, modified or withdrawn in any way, subject to Section 5.7.

 

Section 3.5.                                                         No Conflict; Required Filings and Consents.

 

(a)                                 Except as set forth in Section 3.5(a) of the Giants Disclosure Letter, none of the execution, delivery or performance of this Agreement or the Ancillary Documents to which any Giants Party is a party, the consummation of the Transactions or compliance by such Giants Parties with any of the provisions of this Agreement or any Ancillary Document will, (i) assuming receipt of the Giants Stockholder Approval, conflict with or result in any breach of any provision of (A) the Giants Charter, the Giants Bylaws, the certificate of limited partnership of the Operating Partnership or the Partnership Agreement or (B) any governing documents of any Giants Subsidiary, (ii) assuming that all consents, approvals, authorizations and permits described in Section 3.5(b) have been obtained, all filings and notifications described in

 

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Section 3.5(b) have been made and any waiting periods thereunder have terminated or expired, require any filing by the Giants Parties with, or the obtaining of any permit, authorization, consent or approval of, any court, arbitral tribunal, administrative agency or commission or other governmental or other regulatory authority or agency, whether foreign, federal, state or local (a “Governmental Entity”), (iii) automatically result in a modification, violation or breach of, or material increase in cost or obligation of Giants or any Giants Subsidiary under, or constitute (with or without notice or lapse of time or both) a default (or give rise to any right to others, including, but not limited to, any right of termination, amendment, cancellation or acceleration) under, or give rise to any right of purchase, first offer or forced sale under or result in the creation of a Lien on any property or asset of Giants or any Giants Subsidiary pursuant to any note, bond, mortgage, debt instrument, indenture, contract, agreement, ground lease, license, permit or other legally binding obligation to which Giants or any Giants Subsidiary is a party, (iv) assuming that all consents, approvals, authorizations and permits described in Section 3.5(b) have been obtained, all filings and notifications described in Section 3.5(b) have been made and any waiting periods thereunder have terminated or expired, violate any order, writ, injunction, decree or Law applicable to such Giants Parties or any of their respective properties or assets, or (v) assuming receipt of the Giants Stockholder Approval, require any consent or approval of, or notice to, any other Person, including, without limitation, from limited partners, members or parties to leases or other agreements or commitments, except, as to clauses (i)(B), (ii), (iv) and (v), respectively, for any such conflicts, violations, breaches, defaults or other occurrences which, individually or in the aggregate, have not had and would not reasonably be expected to have a Giants Material Adverse Effect.

 

(b)                                 The execution and delivery of this Agreement or the Ancillary Documents to which any Giants Party is a party does not, and the performance of this Agreement, any Ancillary Document or the Ancillary Documents to which any Giants Party is a party will not, require any consent, approval, authorization or permit of, or filing with or notification to, any Governmental Entity, except (i) (A) the filing with the Securities and Exchange Commission (the “SEC”) of a proxy statement in preliminary and definitive form relating to the Giants Stockholder Meeting (together with any amendments or supplements thereto, the “Proxy Statement”) and (B) such reports under, and other compliance with, the Exchange Act (and the rules and regulations promulgated thereunder) and the Securities Act (and the rules and regulations promulgated thereunder) as may be required in connection with this Agreement and the Transactions, (ii) as may be required under the rules and regulations of the NYSE, (iii) filings, permits, authorizations, consents, waiting period expirations or terminations, and approvals as may be required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), (iv) the filing with SDAT of any articles of merger and the acceptance for record by SDAT of such articles of merger pursuant to the MGCL, or the filing of any certificate of merger with the Delaware Secretary, in each case, as required in connection with any merger contemplated by the Transactions, (v) such filings and approvals as may be required by any applicable state securities or “blue sky” Laws, (vi) such filings as may be required in connection with state and local transfer Taxes, and (vii) where failure to obtain such consents, approvals, authorizations or permits, or to make such filings or notifications, individually or in the aggregate, has not had and would not reasonably be expected to have a Giants Material Adverse Effect.

 

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Section 3.6.                                                         SEC Filings; Financial Statements.

 

(a)                                 Giants has filed with, or furnished (on a publicly available basis) to, the SEC all forms, reports, schedules, statements and documents required to be filed or furnished by it under the Securities Act or the Exchange Act, as the case may be, including any amendments or supplements thereto, from and after April 15, 2014 (collectively, the “Giants SEC Filings”).  Each Giants SEC Filing, as amended or supplemented, if applicable, (i) as of its date (or, if amended or supplemented, as of the date of the most recent amendment or supplement thereto, in each case, to the extent filed prior to the date of this Agreement) complied in all material respects with the requirements of the Securities Act or the Exchange Act, as the case may be, and the applicable rules and regulations of the SEC thereunder, and (ii) did not, at the time it was filed (or became effective in the case of registration statements) or furnished (or, if amended or supplemented, as of the date of the most recent amendment or supplement thereto in each case, to the extent filed prior to the date of this Agreement) contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading.  To the knowledge of Giants, none of the Giants SEC Filings is the subject of ongoing SEC review and Giants does not have any outstanding and unresolved comments from the SEC with respect to any Giants SEC Filing, nor any inquiry or information request from the SEC.  As of the date of this Agreement, no Giants Subsidiary is separately subject to the periodic reporting requirements of the Exchange Act.  Giants has made available to the Jaguar Parties complete and correct copies of all material written correspondence between the SEC, on the one hand, and Giants, on the other hand, since April 15, 2014.

 

(b)                                 None of Giants or any Giants Subsidiary has made any prohibited loans to any director or executive officer of the Giants (as defined in Rule 3b-7 promulgated under the Exchange Act).

 

(c)                                  Each of the consolidated financial statements contained or incorporated by reference in the Giants SEC Filings as amended, supplemented or restated, if applicable (in each case, to the extent included in a filing prior to the date of this Agreement), including the related notes and schedules (except as indicated in the notes thereto) (i) was prepared from the books and records of Giants and the Giants Subsidiaries (as applicable), (ii) was prepared in accordance with United States Generally Accepted Accounting Principles (“GAAP”) applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto or, in the case of interim financial statements, for normal and recurring year-end adjustments), and (iii) fairly present, in all material respects, the consolidated financial position, results of operations, stockholders’ equity and cash flows of Giants and its consolidated subsidiaries as of the respective dates thereof and for the periods referred to therein (subject, in the case of unaudited quarterly financial statements, to normal year-end adjustments).

 

(d)                                 Neither Giants nor any Giants Subsidiary is a party to, or has any commitment to become a party to, any joint venture, off-balance sheet partnership or any similar contract or arrangement, including any contract relating to any transaction or relationship between or among Giants and any Giants Subsidiary, on the one hand, and any unconsolidated Affiliate of Giants or any Giants Subsidiary, including any structure finance, special purpose or limited purpose entity or Person, on the other hand, or any “off-balance sheet arrangements” (as defined in Item 303(a) of Regulation S-K of the SEC), which is intended to avoid disclosure of any material transaction involving, or material liability of, Giants or any Giants Subsidiary that

 

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would otherwise be required to be disclosed on such Giants’ or Giants Subsidiary’s audited financial statements or other Giants SEC Filings.

 

Section 3.7.                                                         Internal Controls.  After taking into account that services are provided under the Giants Advisory Agreement, the records, systems, controls, data and information of Giants and the Giants Subsidiaries that are used in the system of internal accounting controls described in the following sentence are recorded, stored, maintained and operated under means that are under the exclusive ownership and direct control of Giants or the Giants Subsidiaries or accountants, except for any non-exclusive ownership and non-direct control that would not reasonably be expected to have a materially adverse effect on the system of internal accounting controls.  After taking into account that services are provided under the Giants Advisory Agreement, Giants and the Giants Subsidiaries have devised and maintain a system of internal accounting controls sufficient to provide reasonable assurances regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP, including that:  (1) transactions are executed only in accordance with management’s authorization; (2) transactions are recorded as necessary to permit preparation of the financial statements of Giants and the Giants Subsidiaries and to maintain accountability for the assets of Giants and the Giants Subsidiaries; (3) access to such assets is permitted only in accordance with management’s authorization; (4) the reporting of such assets is compared with existing assets at regular intervals; and (5) accounts, notes and other receivables and inventory are recorded accurately, and proper and adequate procedures are implemented to effect the collection thereof on a current and timely basis.  Giants’ principal executive officer and its principal financial officer have disclosed to Giants’ auditors and the audit committee of the Giants Board (i) all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting that are reasonably likely to adversely affect Giants’ ability to record, process, summarize and report financial data, and (ii) any fraud, whether or not material, that involves management or other employees who have a significant role in Giants’ internal controls, and Giants has made available to the Jaguar Parties copies of any material written materials relating to the foregoing.  After taking into account that services are provided under the Giants Advisory Agreement, Giants has established and maintains disclosure controls and procedures (as such term is defined in Rule 13a-15 promulgated under the Exchange Act) designed to ensure that material information relating to Giants required to be included in reports filed under the Exchange Act, including its consolidated subsidiaries, is made known to Giants’ principal executive officer and its principal financial officer by others within those entities, particularly during the periods in which the periodic reports required under the Exchange Act are being prepared, and such disclosure controls and procedures are effective in timely alerting Giants’ principal executive officer and its principal financial officer to material information required to be included in Giants’ periodic reports required under the Exchange Act.

 

Section 3.8.                                                         No Undisclosed Liabilities.  Except as reflected or reserved against on Giants’ most recent balance sheet (or, in the notes thereto) included in the Giants SEC Filings, none of Giants or its consolidated subsidiaries has any liabilities or obligations of any nature (whether accrued, contingent or otherwise) which are required by GAAP to be reflected in a consolidated balance sheet, except for liabilities or obligations (i) expressly contemplated by, or arising out of, or under this Agreement, (ii) incurred in the ordinary course of business consistent with past practice since the most recent balance sheet set forth in the Giants SEC Filings made through and including the date of this Agreement, (iii) described in Section 3.8 of the Giants

 

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Disclosure Letter or (iv) that, individually or in the aggregate, have not had and would not reasonably be expected to have a Giants Material Adverse Effect.

 

Section 3.9.                                                         Absence of Certain Changes or Events.  Between December 31, 2015 and the date hereof, except as contemplated by this Agreement or as set forth in Section 3.9 of the Giants Disclosure Letter, Giants and each Giants Subsidiary has conducted its business in the ordinary course in all material respects consistent with past practice.  Since December 31, 2015, there has not been any Giants Material Adverse Effect.

 

Section 3.10.                                                  Litigation.  Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Giants Material Adverse Effect, or as set forth in Section 3.10 of the Giants Disclosure Letter, as of the date hereof, there is no litigation, claim, action, suit, arbitration, alternative dispute resolution action, order, decree, writ, injunction, government investigation, proceeding or any other judicial or administrative proceeding, in Law or equity (each, an “Action”), pending against (or to the knowledge of the Giants Parties, threatened in writing against), Giants, a Giants Subsidiary or any executive officer or director of Giants (in their capacity as such) nor, to the knowledge of the Giants Parties, is there any investigation by a Governmental Entity pending or threatened in writing against Giants or any Giants Subsidiary, other than as have not had and would not reasonably be expected to have, individually or in the aggregate, a Giants Material Adverse Effect.  As of the date hereof, neither Giants nor any Giants Subsidiary is subject to any outstanding order, writ, injunction, decree or arbitration ruling or judgment or award of any Governmental Entity which has had or would reasonably be expected to have, individually or in the aggregate, a Giants Material Adverse Effect or which would reasonably be expected to adversely affect the ability of Giants or any Giants Subsidiary to perform its obligations hereunder or under any Ancillary Documents to which such Persons are a party, or prevent or materially delay the consummation of the Transactions.

 

Section 3.11.                                                  Labor and Other Employment Matters.  Neither Giants nor any Giants Subsidiary has, or has within the past three (3) years had, any employees (whether directly or as a “joint” or “single” employer).

 

Section 3.12.                                                  Employee Benefit Plans.

 

(a)                                 There are no Giants Benefit Plans other than the Giants Stock Plans.

 

(b)                                 Except as, individually or in the aggregate, have not had and would not reasonably be expected to have a Giants Material Adverse Effect, each Giants Benefit Plan has been established and administered in accordance with its terms and in compliance with all applicable Laws, including the Code.

 

(c)                                  No Giants Benefit Plan is, and neither Giants nor any Giants Subsidiary maintains, contributes to, or participates in, or has ever maintained, contributed to, or participated in, or otherwise would reasonably expect to have any obligation or liability in connection with:  (i) a “pension plan” under Section 3(2) of ERISA that is subject to Title IV or Section 302 of ERISA or Section 412 or 4971 of the Code, (ii) a Multiemployer Plan, (iii) a

 

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“multiple employer welfare arrangement” (as defined in Section 3(40) of ERISA), or (iv) a “multiple employer plan” (as defined in Section 413I of the Code).

 

(d)                                 Except as would not result in a loss of tax deduction to Giants under Section 280G of the Code, no amount that would reasonably be expected to be received (whether in cash or property or the vesting of property) as a result of the Transactions (alone or in combination with any other event) by any Person who is a “disqualified individual” (as such term is defined in Treasury Regulation Section 1.280G-1) would reasonably be expected to be characterized as an “excess parachute payment” (as such term is defined in Section 280G(b)(1) of the Code).

 

(e)                                  Neither Giants nor any Giants Subsidiary is a party to, or has any obligation under, any Contract or Giants Benefit Plan to compensate any Person for excise taxes payable pursuant to Section 4999 of the Code or for additional taxes payable pursuant to Section 409A of the Code.

 

Section 3.13.                                                  Taxes.  Except as expressly set forth in Section 3.13 of the Giants Disclosure Letter:

 

(a)                                 Giants and each Giants Subsidiary has (i) duly and timely filed (or caused to be filed on its behalf) with the appropriate Governmental Entity all U.S. federal and all other material Tax Returns required to be filed by it, taking into account any extensions of time within which to file such Tax Returns, and all such Tax Returns were and are true, correct and complete and (ii) duly and timely paid in full (or there has been duly and timely paid in full on its behalf), or made adequate provision for, all material amounts of Taxes required to be paid by it.

 

(b)                                 Giants (i) for its taxable years commencing with Giants’ taxable year that ended on December 31, 2010 and through and including its taxable year ended December 31, 2015 (and, for purposes of Section 7.3(a), through and including in its taxable year ended December 31, 2016, if the Closing Date occurs in the taxable year ending December 31, 2017) has been subject to taxation as a REIT and has satisfied all requirements to qualify as a REIT for such taxable years; (ii) has operated since January 1, 2016 (and, for purposes of Section 7.3(a), January 1, 2017, if the Closing Date occurs in the taxable year ending December 31, 2017) to the date hereof in such a manner so as to qualify as a REIT; (iii) intends to continue to operate through the Closing Date in such a manner so as to qualify as a REIT; and (iv) has not taken or omitted to take any action that would reasonably be expected to result in a challenge by the IRS or any other Governmental Entity to its status as a REIT, and no such challenge is pending or threatened in writing.

 

(c)                                  Each Giants Subsidiary has been since the later of its acquisition or formation and continues to be treated for U.S. federal Tax purposes as (i) a partnership (or a disregarded entity) and not as a corporation or an association or publicly traded partnership taxable as a corporation, (ii) a Qualified REIT Subsidiary or (iii) a Taxable REIT Subsidiary.

 

(d)                                 Neither Giants nor any Giants Subsidiary holds, directly or indirectly, any asset the disposition of which would be subject to (or to rules similar to) Section 1374 of the Code.

 

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(e)                                  (i) There are no audits, investigations or proceedings pending (or threatened in writing) for and/or in respect of any material Taxes or material Tax Returns of Giants or any Giants Subsidiary and neither Giants nor any Giants Subsidiary is a party to any litigation or administrative proceeding relating to Taxes; (ii) no deficiency for Taxes of Giants or any Giants Subsidiary has been claimed, proposed or assessed in writing or, to the knowledge of Giants, threatened in writing, by any Governmental Entity, which deficiency has not yet been settled, except for such deficiencies which are being contested in good faith; (iii) neither Giants nor any Giants Subsidiary has extended or waived (nor granted any extension or waiver of) the limitation period for the assessment or collection of any Tax that has not since expired; and (iv) neither Giants nor any Giants Subsidiary has entered into any “closing agreement” as described in Section 7121 of the Code (or any corresponding or similar provision of state, local or foreign income Tax Law).

 

(f)                                   Since Giants’ formation, (i) neither Giants nor any Giants Subsidiary has incurred any material liability for Taxes under Sections 857(b), 860(c) or 4981 of the Code which have not been previously paid; and (ii) neither Giants nor any Giants Subsidiary has incurred any material liability for any other Taxes other than (x) in the ordinary course of business, or (y) transfer or similar Taxes arising in connection with acquisitions or dispositions of property.  No event has occurred, and no condition or circumstance exists, which presents a material risk that any material amount of Tax described in the previous sentence will be imposed upon Giants or any Giants Subsidiary (other than in connection with the Transactions).

 

(g)                                  Giants and each Giants Subsidiary has complied in all material respects with all applicable Laws relating to the payment and withholding of Taxes (including withholding of Taxes pursuant to Sections 1441, 1442, 1445, 1446 and 3402 of the Code or similar provisions under any state and foreign Laws) and have duly and timely withheld and, in each case, have paid over to the appropriate Governmental Entities any and all material amounts required to be so withheld and paid over on or prior to the due date thereof under all applicable Laws.

 

(h)                                 There are no Giants Tax Protection Agreements (as hereinafter defined) in force as of the date of this Agreement, and, as of the date of this Agreement, no Person has raised in writing a material claim against Giants or any Giants Subsidiary for any breach of any Giants Tax Protection Agreement.  As used herein, “Giants Tax Protection Agreement” means any written agreement to which Giants or any Giants Subsidiary is a party pursuant to which:  (i) any liability to holders of limited partnership interests in a Giants Subsidiary Partnership relating to Taxes may arise, whether or not as a result of the consummation of the Transactions; and/or (ii) in connection with the deferral of income Taxes of a holder of limited partnership interests in a Giants Subsidiary Partnership, Giants or the Giants Subsidiaries have agreed to (A) maintain a minimum level of debt, continue a particular debt or provide rights to guarantee debt, (B) retain or not dispose of assets for a period of time that has not since expired, (C) make or refrain from making Tax elections, and/or (D) only dispose of assets in a particular manner.  As used herein, “Giants Subsidiary Partnership” means a Giants Subsidiary that is a partnership for United States federal income tax purposes.

 

(i)                                     There are no material Tax Liens upon any property or assets of Giants or any Giants Subsidiary except Liens for Taxes not yet due and payable or that are being contested

 

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in good faith by appropriate proceedings and for which adequate reserves have been established in accordance with GAAP.

 

(j)                                    Except as set forth on Section 3.13(j) of the Giants Disclosure Letter, neither Giants nor any Giants Subsidiary (A) has been a member of an affiliated group filing a consolidated U.S. federal income Tax Return or (B) has any liability for the Taxes of any Person (other than Giants or any Giants Subsidiary) under Treasury Regulations Section 1.1502-6 (or any similar provision of state, local or foreign law), as a transferee or successor, or otherwise.

 

(k)                                 Neither Giants nor any Giants Subsidiary has participated in any “listed transaction” within the meaning of Treasury Regulations Section 1.6011-4(b)(2).

 

(l)                                     Neither Giants nor any of the Giants Subsidiaries has constituted either a “distributing corporation” or a “controlled corporation” (within the meaning of Section 355(a) of the Code) in a distribution of stock qualifying for tax-free treatment under Section 355 of the Code in the two (2) years prior to the date of this Agreement.

 

(m)                             Neither Giants nor any of the Giants Subsidiaries (other than Taxable REIT Subsidiaries) currently has or, as of December 31 of any taxable year through and including the taxable year ended December 31 immediately prior to the Closing Date, has had any earnings and profits attributable to such entity or any other corporation in any non-REIT year within the meaning of Section 857(a) of the Code.

 

Section 3.14.                                                  Material Contracts.

 

(a)                                 Except for contracts listed in Section 3.14(a) of the Giants Disclosure Letter or filed as exhibits to the Giants SEC Filings, as of the date of this Agreement, neither Giants nor any Giants Subsidiary is a party to or bound by any contract that, as of the date hereof:

 

(i)                                     is required to be filed as an exhibit to Giants’ Annual Report on Form 10 K pursuant to Item 601(b)(2), (4), (9) or (10) of Regulation S K promulgated by the SEC;

 

(ii)                                  obligates Giants or any Giants Subsidiary to make non-contingent aggregate annual expenditures (other than principal and/or interest payments or the deposit of other reserves with respect to debt obligations) in excess of $500,000 and is not cancelable within ninety (90) days without material penalty to Giants or any Giants Subsidiary, except for any lease under which Giants or any Giants Subsidiary is lessee or any ground lease affecting any Giants Property;

 

(iii)                               contains any non-compete or exclusivity provisions with respect to any line of business or geographic area that restricts the business of Giants or any Giants Subsidiary in any material respect, or that otherwise restricts the lines of business conducted by Giants or any Giants Subsidiary or the geographic area in which Giants or any Giants Subsidiary may conduct business in any material respect;

 

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(iv)                              is an agreement which obligates Giants or any Giants Subsidiary to indemnify any past or present directors, officers, trustees, employees and agents of Giants or any Giants Subsidiary pursuant to which Giants or a Giants Subsidiary is the indemnitor, in each case, other than pursuant to any Governing Documents, operating agreements, property management agreements, advisory agreements or any similar agreement;

 

(v)                                 obligates Giants or any Giants Subsidiary to any material continuing contractual obligation (i) for indemnification under any agreements relating to the sale of real property, or any other business or material assets, previously owned, whether directly or indirectly, by Giants or any Giants Subsidiary that are reasonably likely to involve a Liability of $1,000,000 or more or (ii) to make payments, contingent or otherwise, on account of prior acquisitions or sales of any real property of Giants or any Giants Subsidiary;

 

(vi)                              constitutes an Indebtedness obligation of Giants or any Giants Subsidiary with a principal amount outstanding as of the date hereof greater than $500,000;

 

(vii)                           requires Giants or any Giants Subsidiary to dispose of or acquire assets or properties (other than in connection with the expiration of a Giants Lease or a ground lease affecting a Giants Property) with a fair market value in excess of $1,000,000, or involves any pending or contemplated merger, consolidation or similar business combination transaction, except for any Giants Lease or any ground lease affecting any Giants Property;

 

(viii)                        constitutes an interest rate cap, interest rate collar, interest rate swap or other contract or agreement relating to a hedging transaction;

 

(ix)                              is an agreement, arrangement or understanding between Giants or any Giants Subsidiary, on the one hand, and Giants Advisor, or any Affiliate of Giants or Giants Advisor, on the other hand;

 

(x)                                 constitutes a loan to any Person (other than a wholly owned Giants Subsidiary) by Giants or any Giants Subsidiary (other than advances made pursuant to the Giants Leases or any disbursement agreement, development agreement, or development addendum entered into in connection with a Giants Lease with respect to the development, construction, or equipping of Giants Properties or the funding of improvements to Giants Properties) in an amount in excess of $500,000;

 

(xi)                              governs the WWP Joint Venture, or sets forth the operational terms of any other joint venture, partnership, limited liability company or strategic alliance of Giants or any Giants Subsidiary with any party other than Giants or a Giants Subsidiary;

 

(xii)                           is an agreement obligating Giants or any Giants Subsidiaries to provide any funds to, or make any investment (in the form of a loan, capital contribution or otherwise) in, any other Person in excess of $500,000;

 

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(xiii)                        is an agreement with or for the benefit of any Governmental Entity requiring payment in excess of $500,000 in any calendar year remaining in its term or requires total remaining payment in excess of $500,000;

 

(xiv)                       is a gross maximum price contract or an agreement for any construction or development work (including any additions or expansions) which are currently in effect and under which Giants or any Giants Subsidiaries currently has an obligation in excess of $5,000,000;

 

(xv)                          is an agreement between Giants or any Giants Subsidiary, on the one hand, any other Giants Party or any Giants Party’s respective current directors, officers, partners, members or other Affiliates, on the other hand; or

 

(xvi)                       is a management agreement (i.e., contracts providing for or otherwise governing the management and/or operation of Giants, any Giants Subsidiaries or Giants Properties), including, without limitation, asset management, construction management and property management agreements pursuant to which Giants or any Giants Subsidiaries are obligated to pay to another party an amount in excess of $1,000,000.

 

Each contract of the type described above in this Section 3.14(a), whether or not listed on Section 3.14(a) of the Giants Disclosure Letter, to which Giants or any Giants Subsidiary is a party or by which it is bound as of the date hereof and together with the OPP Termination Agreement is referred to herein as a “Giants Material Contract”.  True and complete copies of each Giants Material Contract listed on Section 3.14(a) of the Giants Disclosure Letter have been provided or made available to the Jaguar Parties.

 

(b)                                 Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Giants Material Adverse Effect, each Giants Material Contract is legal, valid, binding and enforceable on Giants and each Giants Subsidiary that is a party thereto and, to the knowledge of Giants, each other party thereto, and is in full force and effect, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting creditors’ rights generally and by general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at Law).  Except as, individually or in the aggregate, have not had and would not reasonably be expected to have a Giants Material Adverse Effect, Giants and each Giants Subsidiary has performed all obligations required to be performed by it prior to the date hereof under each Giants Material Contract and, to the knowledge of Giants, each other party thereto has performed all obligations required to be performed by it prior to the date hereof under each Giants Material Contract.  None of Giants or any Giants Subsidiary, nor, to the knowledge of Giants, any other party thereto, is in material breach or violation of, or default under, any Giants Material Contract, and no event has occurred that, with notice or lapse of time or both, would constitute a violation or breach of, or default under, any Giants Material Contract, except where in each case such breach, violation or default is not reasonably likely to have, individually or in the aggregate, reasonably be expected to have a Giants Material Adverse Effect.  Neither Giants nor any Giants Subsidiary has given or received notice of any violation or default under any Giants Material Contract, except for

 

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violations or defaults that would not, individually or in the aggregate, reasonably be expected to have a Giants Material Adverse Effect.

 

Section 3.15.                                                  Environmental Matters.  Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Giants Material Adverse Effect, or as set forth in Section 3.15 of the Giants Disclosure Letter:  (a) Giants and each Giants Subsidiary are in compliance with all Environmental Laws; (b) neither Giants nor any Giants Subsidiary has received any written notice, demand, letter or claim alleging that Giants or any such Giants Subsidiary is in violation of, or liable under, any Environmental Law or that any judicial, administrative or compliance order has been issued against Giants or any Giants Subsidiary which remains unresolved; and (c) neither Giants nor any Giants Subsidiary has entered into or agreed to any consent decree or order or is subject to any judgment, decree or judicial, administrative or compliance order relating to compliance with Environmental Laws, Environmental Permits or the investigation, sampling, monitoring, treatment, remediation, removal or cleanup of Hazardous Substances and no investigation, litigation or other proceeding is pending or, to the knowledge of Giants, threatened against Giants or any Giants Subsidiary under any Environmental Law.  This Section 3.15 contains the exclusive representations and warranties of Giants with respect to environmental matters.

 

Section 3.16.                                                  Compliance with Laws; Permits.

 

(a)                                 As of the date hereof, (i) Giants and each Giants Subsidiary are in compliance with all Laws applicable to Giants or any Giants Subsidiary or by which any property or asset of Giants or any Giants Subsidiary is bound and (ii) no notice, charge or assertion has been received by Giants or any Giants Subsidiary or, to the knowledge of Giants, threatened against Giants or any Giants Subsidiary alleging any non-compliance of Giants or any Giants Subsidiary with any such Laws, except in each case above for such non-compliance that has not had and would not reasonably be expected to have a Giants Material Adverse Effect.  Notwithstanding anything to the contrary in this Section 3.16(a), the provisions of this Section 3.16(a) shall not apply to matters covered by Section 3.11 (Labor and Other Employment Matters), Section 3.12 (Employee Benefit Plans) or Section 3.15 (Environmental Matters).

 

(b)                                 Giants and each Giants Subsidiary is in possession of all authorizations, licenses, permits, certificates, approvals variances, exemptions, orders, franchises, certifications and clearances of any Governmental Entity necessary for Giants and each Giants Subsidiary to own, lease and operate its properties or to carry on its respective business as currently conducted (the “Giants Permits”), and all such Giants Permits are valid, and in full force and effect, except where the failure to possess and maintain such Giants Permits in full force and effect has not had and would not reasonably be expected to have a Giants Material Adverse Effect.  All applications required to have been filed for the renewal of the Giants Permits have been filed on a timely basis with the appropriate Governmental Entity, and all other filings required to have been made with respect to such Giants Permits have been duly made on a timely basis with the appropriate Governmental Entity, except in each case, where such failure to do so, individually or in the aggregate, has not had and would not reasonably be expected to have a Giants Material Adverse Effect.  Neither Giants nor any Giants Subsidiary has received any claim or notice, nor has any knowledge indicating, that Giants or any Giants Subsidiary currently is not in compliance with the terms of any Giants Permit, except where the failure to be in compliance

 

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with the terms of any such Giants Permit, individually or in the aggregate, would not have had and would not reasonably be expected to have a Giants Material Adverse Effect.

 

(c)                                  Neither Giants nor any Giants Subsidiary is required to be a registered “Investment Company” under the Investment Company Act.

 

Section 3.17.                                                  Intellectual Property.  Except as set forth on Section 3.17 of the Giants Disclosure Letter or, as individually or in the aggregate, has not had and would not reasonably be expected to have a Giants Material Adverse Effect, (a) Giants and the Giants Subsidiaries own or are licensed or otherwise possess valid rights to use all Intellectual Property used in the conduct of the business of Giants and the Giants Subsidiaries as it is currently conducted, (b) the conduct of the business of Giants and the Giants Subsidiaries as it is currently conducted does not infringe, misappropriate or otherwise violate and, to the knowledge of Giants, is not alleged to infringe, misappropriate or otherwise violate, the Intellectual Property rights of any third party, (c) there are no pending or, to the knowledge of Giants, threatened claims with respect to any of the Intellectual Property rights owned by Giants or any Giants Subsidiary, and (d) to the knowledge of Giants, no third party is currently infringing or misappropriating Intellectual Property rights of Giants or any Giants Subsidiary.  This Section 3.17 contains the exclusive representations and warranties of Giants with respect to intellectual property matters.

 

Section 3.18.                                                  Properties.

 

(a)                                 Section 3.18(a) of the Giants Disclosure Letter sets forth a list of the common name of each facility and real property owned, leased (as lessee or sublessee), including ground leased, or under contract for purchase by Giants or any Giants Subsidiary as of the date of this Agreement (all such real property interests, together with all buildings, structures and other improvements and fixtures located on or under such real property and all easements, rights and other appurtenances benefitting such real property, are individually referred to herein as a “Giants Property” and collectively referred to herein as the “Giants Properties”).  Except as set forth in Section 3.18(a) of the Giants Disclosure Letter, as of the date hereof there are no real properties that Giants or any Giants Subsidiary is obligated to buy, lease or sublease at some future date.

 

(b)                                 Giants or a Giants Subsidiary owns fee simple title or leasehold title (as applicable) to each of the Giants Properties, in each case, free and clear of Liens, except for Giants Permitted Liens.  Except as set forth on Section 3.18(b) of the Giants Disclosure Letter, Giants and the Giants Subsidiaries have not granted, and to the knowledge of Giants, none of the Giants Properties is subject to, unexpired option to purchase agreements, rights of first refusal or first offer or any other rights to purchase or otherwise acquire any Giants Property or any portion thereof.

 

(c)                                  The Giants Properties are, to the knowledge of Giants, (x) supplied with utilities and other services as necessary to permit their continued operation as they are now being operated and (y) in good working order sufficient for their normal operation in the manner currently being operated and without any structural defects other than as may be disclosed in any physical condition reports that have been made available to the Jaguar Parties, except for any of

 

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the foregoing as, individually or in the aggregate, have not had and would not reasonably be expected to have a Giants Material Adverse Effect.

 

(d)                                 Neither Giants nor any Giants Subsidiary has received (i) written notice that any certificate, permit or license from any Governmental Entity having jurisdiction over any of the Giants Properties necessary to permit the lawful use and operation of the buildings and improvements on any of the Giants Properties as currently used and operated or that is necessary to permit the lawful use and operation of all utilities and means of egress and ingress to and from any of the Giants Properties for the current use and operation of the Giants Properties is not in full force and effect as of the date of this Agreement, except for such failures to be in full force and effect that, individually or in the aggregate, would not reasonably be expected to have a Giants Material Adverse Effect, or of any pending written threat of modification or cancellation of any of same, that would reasonably be expected to have a Giants Material Adverse Effect, or (ii) written notice of any uncured violation of any Laws affecting any of the Giants Properties which, individually or in the aggregate, has had or would reasonably be expected to have a Giants Material Adverse Effect.

 

(e)                                  Except as set forth in Section 3.18(e) of the Giants Disclosure Letter, no condemnation, eminent domain or similar proceeding has occurred or is pending with respect to any Giants Property and, except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Giants Material Adverse Effect, neither Giants nor any Giants Subsidiary has received any written notice to the effect that (i) any condemnation or rezoning proceedings are threatened with respect to any of the Giants Properties, or (ii) any zoning regulation or ordinance (including with respect to parking), Board of Fire Underwriters rules, building, fire, health or other Law has been violated (and remains in violation) for any Giants Property.

 

(f)                                   Section 3.18(f) of the Giants Disclosure Letter sets forth all ground leases affecting the interest of Giants or Giants Subsidiaries in any Giants Property and all amendments, modifications (including pursuant to any estoppel), guarantees, renewals and extensions exercised related thereto (collectively, the “Giants Ground Leases”).  Giants hereby represents that (a) Section 3.18(f) of the Giants Disclosure Letter contains a true, complete and correct list of all Giants Ground Leases to which Giants or Giants Subsidiaries is bound; (b) true, complete and correct copies of such Giants Ground Leases have been delivered or made available to the Jaguar Parties; and (c) each such Giants Ground Lease is valid, binding and enforceable in accordance with its terms and is in full force and effect with respect to Giants or its Subsidiaries and, to the knowledge of Giants, with respect to the other parties thereto, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting creditors’ rights generally and by general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at Law).  As of the date hereof, there are no monetary defaults under any Giants Ground Lease to which Giants or Giants Subsidiaries are bound, by Giants or Giants Subsidiaries or any other party thereto.  As of the date hereof, Giants and Giants Subsidiaries have not sent or received any notice of any violation or breach of, or default under, any Giants Ground Lease to which Giants or Giants Subsidiaries are bound.

 

(g)                                  Except for discrepancies, errors or omissions that, individually or in the aggregate, would not reasonably be expected to have a Giants Material Adverse Effect, the rent

 

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rolls for each of the Giants Properties as of April 1, 2016 (other than with respect to World Wide Plaza, which rent rolls are as of March 31, 2016), have been previously made available to the by or on behalf of Giants or any Giants Subsidiary to the Jaguar Parties (including an indication of whether any Giants Property is subject to net leases), are true and correct and (i) correctly reference each tenant under each lease or sublease that was in effect as of as of April 1, 2016 (other than with respect to World Wide Plaza, which leases or subleases were in effect as of March 31, 2016), and to which Giants or a Giants Subsidiary is a party as lessor or sublessor with respect to each of the Giants Properties (all leases or subleases (including any net leases), together with all amendments, modifications, supplements, renewals and extensions related thereto, the “Giants Leases”) and (ii) identify the rent payable under the Giants Lease as of such date.  Giants has made available to the Jaguar Parties a list of all security deposit amounts currently held under the Giants Leases.

 

(h)                                 True and complete (in all material respects) copies of all (x) Giants Ground Leases and (y) Giants Leases for space in excess of 25,000 square feet in or at any Giants Properties (the “Material Giants Leases”), in each case in effect as of the date hereof, have been made available to the Jaguar Parties.  Except as would not, individually or in the aggregate, reasonably be expected to have a Giants Material Adverse Effect, (i) neither Giants nor any Giants Subsidiary has given or received written notice of any violation or breach of, or default under, any Material Giants Lease, (ii) except as set forth on Section 3.18(h) of the Giants Disclosure Letter, no tenant under a Material Giants Lease is in monetary default under such Material Giants Lease and (iii) each Material Giants Lease is valid, binding and enforceable in accordance with its terms and is in full force and effect with respect to Giants or a Giants Subsidiary and, to the knowledge of Giants, with respect to the other parties thereto, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting creditors’ rights generally and by general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at Law).

 

(i)                                     Except as set forth on Section 3.18(i) of the Giants Disclosure Letter, there are no material Tax abatements or exemptions specifically affecting the Giants Properties, and Giants and the Giants Subsidiaries have not received any written notice of (and Giants and the Giants Subsidiaries do not have any knowledge of) any proposed increase in the assessed valuation of any of the Giants Properties, except in each case for any such Taxes or assessment that have not had and would not reasonably be expected to have, individually or in the aggregate, a Giants Material Adverse Effect.

 

(j)                                    Except for Giants Permitted Liens, as set forth in Giants Leases and title documents made available to the Jaguar Parties prior to the date hereof or as would not reasonably be expected to have, individually or in the aggregate, a Giants Material Adverse Effect and except as set forth on Section 3.18(j) of the Giants Disclosure Letter, neither Giants nor any Giants Subsidiary is a party to any (i) unexpired option to purchase agreements, rights of first refusal or first offer or any other rights to purchase or otherwise acquire any Giants Property or any portion thereof that would materially adversely affect Giants’, or any Giants Subsidiary’s, ownership, ground lease or right to use a Giants Property subject to a Material Giants Lease, and (ii) other outstanding rights or agreements to enter into any contract for sale, ground lease or letter of intent to sell or ground lease any Giants Property or any portion thereof that is owned by

 

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any Giants Subsidiary, which, in each case, is in favor of any party other than Giants or a Giants Subsidiary.

 

(k)                                 Each Giants Party and each Giants Subsidiary, as applicable, is in possession of all title insurance policies evidencing title insurance with respect to each of their Giants Properties (each, a “Giants Title Policy” and, collectively, the “Giants Title Policies”).  A copy of each Giants Title Policy in the possession or control of Giants or a Giants Subsidiary has been made available to the Jaguar Parties.  No written claim has been made against any Giants Title Policy, which, individually or in the aggregate, would be material to any Giants Property.

 

Section 3.19.                                                  Approval Required.  The Giants Stockholder Approval is the only vote of holders of securities of Giants required to approve this Agreement and the Transactions.  No vote of the holders of any limited partnership units of the Operating Partnership is necessary to approve this Agreement and the Transactions.

 

Section 3.20.                                                  Opinion of Financial Advisor.  The Giants Board has received the oral opinion of Wells Fargo Securities, LLC to be confirmed in writing, to the effect that, as of the date of such opinion and based on and subject to the assumptions, qualifications, limitations and other matters set forth in such written opinion, the aggregate consideration to be paid in the contribution and merger transactions (taken together as an integrated transaction) pursuant to this Agreement is fair, from a financial point of view, to Giants.

 

Section 3.21.                                                  Insurance.  Except for those matters that, individually or in the aggregate, have not had and would not reasonably be expected to have a Giants Material Adverse Effect, there is no claim for coverage by Giants or any Giants Subsidiary pending under any of the material insurance policies (including title insurance policies) and all material fidelity bonds or other insurance service contracts in Giants’ possession providing coverage for all material Giants Properties (the “Giants Insurance Policies”) that has been denied or disputed by the insurer.  Except for those matters that have not had and would not reasonably be expected to have a Giants Material Adverse Effect, all premiums due and payable under all Giants Insurance Policies have been paid, and Giants and the Giants Subsidiaries have otherwise complied in all material respects with the terms and conditions of all the Giants Insurance Policies.  To the knowledge of Giants, such Giants Insurance Policies are valid and enforceable in accordance with their terms and are in full force and effect and no written notice of cancellation or termination has been received by Giants or any Giants Subsidiary with respect to any such policy which has not been replaced on substantially similar terms prior to the date of such cancellation.

 

Section 3.22.                                                  Information in the Proxy Statement and SEC Filings.  None of the information supplied or to be supplied in writing by or on behalf of Giants or any Giants Subsidiary for inclusion or incorporation by reference in the Proxy Statement will, at the date the Proxy Statement is first mailed to the stockholders of Giants, at any time it is amended or supplemented or at the time of the Giants Stockholder Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading.  None of the information supplied or to be supplied by or on behalf of Giants or any Giants Subsidiary for inclusion in any of the filings made or to be made by the Giants Parties or their Affiliates with the SEC or with any stock exchange of or other regulatory authority will, at the

 

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time filed with the SEC, any stock exchange or other regulatory authority, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which they are made, not misleading.  All documents that Giants is responsible for filing with the SEC in connection with the Transactions, to the extent relating to Giants or any Giants Subsidiary or other information supplied by or on behalf of Giants or any Giants Subsidiary for inclusion therein, will comply as to form, in all material respects, with the provisions of the Securities Act or Exchange Act, as applicable, and the rules and regulations of the SEC thereunder and each such document required to be filed with any Governmental Entity (other than the SEC) will comply in all material respects with the provisions of any applicable Law as to the information required to be contained therein.  The representations and warranties contained in this Section 3.22 will not apply to statements or omissions included in the Proxy Statement or any of the filings to be made by the Giants Parties or their Affiliates with the SEC or with any stock exchange of or other regulatory authority to the extent based upon information supplied in writing to Giants by or on behalf of the Jaguar Parties for use therein.

 

Section 3.23.                                                  WWP Joint Venture.  Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Giants Material Adverse Effect, (a) all of the capital obligations currently due and payable of Giants and any Giants Subsidiary and, to the knowledge of Giants, all of the capital obligations of the sponsor member of the WWP Joint Venture, with respect to the WWP Joint Venture, have been fully funded and to the knowledge of Giants, there are no pending capital calls, nor has Giants or any Giants Subsidiary been party to discussions with the sponsor member of the WWP Joint Venture regarding any proposed capital calls, and (b) as of the date hereof, no right of first offer, buy/sell or similar right under the WWP Joint Venture Agreement as to or affecting any Equity Interest in the WWP Joint Venture has been exercised by Giants or any Giants Subsidiary, on the one hand, or the sponsor member of the WWP Joint Venture, on the other hand, or is the exercise of any such right now pending or proposed.  To the knowledge of Giants, the sponsor member of the WWP Joint Venture has not made or advanced any loans that would adversely impact the Giants’ share of distributions from the WWP Joint Venture.  With the exception of the WWP Joint Venture, neither Giants nor any Giants Subsidiary is a party to any Joint Venture.

 

Section 3.24.                                                  Affiliate Transactions.  Except as set forth in Section 3.24 of the Giants Disclosure Letter or in the Giants SEC Filings made through and including the date of this Agreement or as permitted by this Agreement, from April 15, 2014 through the date of this Agreement there have been no transactions, agreements, arrangements or understandings between Giants or any Giants Subsidiary, on the one hand, and any Affiliates (other than Giants Subsidiaries) of Giants or other Persons, on the other hand, that would be required to be disclosed under Item 404 of Regulation S-K promulgated by the SEC.

 

Section 3.25.                          Takeover Statutes.  The Giants Board has taken all action necessary to render inapplicable to the Transactions the restrictions on business combinations contained in Subtitle 6 of Title 3 of the MGCL.  The restrictions on control share acquisitions contained in Subtitle 7 of Title 3 of the MGCL are not applicable to the Transactions.  No other “business combination,” “control share acquisition,” “fair price,” “moratorium” or other takeover or anti-takeover statute is applicable to this Agreement or the Transactions.

 

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Section 3.26.                                                  Brokers; Expenses.  No broker, investment banker, financial advisor or other Person (other than Wells Fargo Securities, LLC), is entitled to receive any broker’s, finder’s, financial advisor’s or other similar fee or commission in connection with this Agreement or the Transactions based upon arrangements made by or on behalf of the Giants Parties or any Giants Subsidiary.  Other than the arrangements described in the engagement letters with Wells Fargo Securities, LLC, true and complete copies of which have been previously made available to the Jaguar Parties, Section 3.26 of the Giants Disclosure Letter sets forth the outside legal, accounting and financial advisors retained as of the date hereof by any Giants Party or any Giants Subsidiary (on its own behalf or on behalf of any other Person) in connection with the Transactions with which such Giants Party has any contingent payment arrangements requiring payments to be made after December 31, 2015 in connection with the Transactions that are contingent upon the execution of this Agreement or the Transactions or, in the case of advisors customarily compensated on the basis of hourly time charges, are not based on actual time charges and expense reimbursement and describes such arrangements.  Since December 31, 2015, none of the Giants Parties or any Giants Subsidiaries or their respective Affiliates has made any material payments in excess of the amounts contemplated by this Section 3.26 to any such advisors.

 

Section 3.27.                                                  Termination of Related Party Agreements.  Concurrently with the execution of this Agreement, Giants has entered into the Termination Agreement and Release, and the OPP Termination Agreement (“Related Party Termination Agreements”) with, among other parties, Giants Advisor.  The Related Party Termination Agreements terminate all existing agreements between Giants or any Giants Subsidiaries, on the one hand, and the Giants Advisor or any of its Subsidiaries, on the other hand, (other than any indemnification agreement for the benefit of Giants Advisor or any current or former officer or director of Giants or any Giants Subsidiaries), effective as of the Closing, subject to the terms of the Related Party Termination Agreements (including the survival of the provisions specified therein). Giants has provided to the Jaguar Parties true, correct and complete executed copies of (i) each Related Party agreement subject to the Related Party Termination Agreements and (ii) the Related Party Termination Agreements.

 

Section 3.28.                                                  Directors and Officers.  The Giants Board has elected, effective as of the Closing, (a) the individuals set forth on Section 3.28(a) of the Giants Disclosure Letter to the Giants Board, and (b) the individuals set forth on Section 3.28(b) of the Giants Disclosure Letter as the executive officers of Giants.

 

Section 3.29.                                                  No Other Representations or Warranties.  Except for the representations and warranties expressly set forth in this Article III, no Giants Party nor any other Person makes any express or implied representation or warranty with respect to the Giants Parties or with respect to any other information provided to the Jaguar Parties in connection with (i) the Transactions or (ii) the businesses, affairs, operations, assets, Liabilities, condition (financial or otherwise) or prospects or any other matter relating to the Giants Parties, including with respect to any documentation, forecasts, budgets, projections, estimates or other information (including the accuracy or completeness of, or the reasonableness of the assumptions underlying, such documentation, forecasts, budgets, projections, estimates or other information) provided by the Giants Parties or any other Person to the Jaguar Parties.

 

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ARTICLE IV

 

REPRESENTATIONS AND WARRANTIES
OF THE JAGUAR PARTIES

 

The following representations and warranties by the Jaguar Parties set forth in this Article IV are qualified in their entirety by reference to the disclosures set forth in the disclosure letter delivered by the Jaguar Parties immediately prior to the execution of this Agreement (the “Jaguar Disclosure Letter”).  Each disclosure set forth in the Jaguar Disclosure Letter shall qualify or modify the Section to which it corresponds and any other Section to the extent the applicability of the disclosure to each other Section is reasonably apparent from the text of the disclosure made.  Except as set forth in the Jaguar Disclosure Letter, each Jaguar Party, severally and not jointly, represents to the Giants Parties as follows; provided, that with respect to any representation or warranty made by any Jaguar Fund, such representation or warranty is made jointly and severally by such Jaguar Fund and Jaguar Operating Partners:

 

Section 4.1.                                                         Organization.

 

(a)                                 Such Jaguar Party is a limited partnership, limited liability company or other legal entity duly organized, validly existing and in good standing under the Laws of the jurisdiction in which it is organized and has the requisite organizational power, as the case may be, and authority to own, lease and operate its properties (including its Included Assets) and to conduct its business as it is now being conducted.  Such Jaguar Party and each of its Subsidiaries is duly qualified or licensed to do business, and is in good standing and has all necessary governmental authorizations, in each jurisdiction where the character of the assets owned, operated or leased by it or the nature of its business makes such qualification, licensing or good standing necessary, except for such failures to be so qualified, licensed or in good standing that, individually or in the aggregate, have not had and would not reasonably be expected to have a Jaguar Material Adverse Effect.  Such Jaguar Party and each of its Subsidiaries is in compliance in all material respects with the terms of its Governing Documents.

 

(b)                                 Each Subsidiary of such Jaguar Party is a limited partnership, limited liability company or other legal entity duly organized, validly existing and in good standing under the Laws of the jurisdiction in which it is organized and has the requisite organizational power, as the case may be, and authority to own, lease and operate its properties (including its Included Assets) and to conduct its business as it is now being conducted, except for such failures to be so organized, in good standing or have certain power and authority that, individually or in the aggregate, have not had and would not reasonably be expected to have a Jaguar Material Adverse Effect.  Each Subsidiary of such Jaguar Party is duly qualified or licensed to do business, and is in good standing and has all necessary governmental authorizations, in each jurisdiction where the character of the assets owned, operated or leased by it or the nature of its business makes such qualification, licensing or good standing necessary, except for such failures to be so qualified, licensed or in good standing that, individually or in the aggregate, have not had and would not reasonably be expected to have a Jaguar Material Adverse Effect.  Each Subsidiary of such Jaguar Party is in compliance in all material respects with the terms of its Governing Documents.

 

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(c)                                  Section 4.1(c) of the Jaguar Disclosure Letter sets forth a true, correct and complete list of all of the Subsidiaries of such Jaguar Party, including a list of each Subsidiary of such Jaguar Party that is a Qualified REIT Subsidiary, a Taxable REIT Subsidiary or a REIT, together with (i) the jurisdiction of incorporation or organization, as the case may be, of each Subsidiary of such Jaguar Party and (ii) the classification for U.S. federal income tax purposes of each Subsidiary of such Jaguar Party.  Exhibit A-2 sets forth for each Jaguar Included Property, a true, correct and complete organizational chart identifying each Jaguar Fund, Subsidiary of a Jaguar Fund, Joint Venture or subsidiary of a Joint Venture through which any Jaguar Party holds a direct or indirect ownership interest in such Jaguar Included Property.

 

(d)                                 Except as set forth on Section 4.1(d) of the Jaguar Disclosure Letter, no Person, other than a Managing Member Entity, an Included Entity or a Jaguar Management Entity, is a managing member or holds any managing member or similar interest in any Included Entity.  Section 4.1(d) of the Jaguar Disclosure Letter sets forth, for each Managing Member Entity, each Person owning Equity Interests therein and the percentage interest of each such Person in such Managing Member Entity.

 

Section 4.2.                                                         Authorization; Validity of Agreement.

 

(a)                                 Such Jaguar Party and each of its Subsidiaries has all necessary organizational power and authority to execute and deliver this Agreement, the Contribution Agreement, the Merger Agreement and each Ancillary Document to be executed and delivered by it at the Closing, to perform its obligations hereunder and thereunder and to consummate the Transactions.  The execution, delivery and performance by such Jaguar Party of this Agreement and the execution, delivery and performance by such Jaguar Party or any of its Subsidiaries of each Ancillary Document to which such Jaguar Party or any such Subsidiary will be a party, and the consummation by such Jaguar Party and each of its Subsidiaries of the Transactions, have been duly and validly authorized by the general partner or managing member of such Jaguar Party or each such Subsidiary (as applicable), and each other member or partner or committee of members or partners or their representatives (as applicable and as necessary), and no other organizational action on the part of such Jaguar Party or any of its Subsidiaries is necessary to authorize the execution and delivery by such Jaguar Party or any of its Subsidiaries of this Agreement, any such Ancillary Document and the consummation by it of the Transactions.  Each Jaguar Management Entity has obtained all required consents from its stockholders, board of directors or other governing body with respect to the Transactions to be effected by such Jaguar Management Entity pursuant to this Agreement, including the applicable merger to be effected by such Management Entity, and true, complete and correct copy of such consents have been delivered to the Giants Parties.  This Agreement has been, and each Ancillary Document to which it is contemplated that such Jaguar Party or any of its Subsidiaries will be party will be, duly executed and delivered by such Jaguar Party or its Subsidiaries (as applicable) and, assuming due and valid authorization, execution and delivery hereof and thereof by each of the Giants Parties party thereto, is or will be a valid and binding obligation of such Jaguar Party or each such Subsidiary, enforceable against such Jaguar Party or each such Subsidiary in accordance with its terms, except as the enforcement hereof or thereof may be limited by (i) bankruptcy, insolvency, reorganization, moratorium or other similar Laws, now or hereafter in effect, relating to creditors’ rights generally and (ii) general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at Law).

 

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(b)                                 Pursuant to a valid power of attorney granted by each of its direct and indirect equityholders (as applicable), the Jaguar Party designated as attorney in fact in such power of attorney has full power and authority to execute and deliver the Partnership Agreement and any other Ancillary Document so executed and delivered by such Jaguar Party on each such equityholder’s behalf, and the execution and delivery by such Jaguar Party of such Ancillary Documents on any such equityholder’s behalf will be binding on such Person as fully as if such Person had executed and delivered such Ancillary Documents.

 

Section 4.3.                                                         No Conflict; Consents.  Except as set forth in Section 4.3 of the Jaguar Disclosure Letter, none of the execution, delivery or performance of this Agreement or any Ancillary Document to which such Jaguar Party or any of its Subsidiaries is a party, the consummation by such Jaguar Party and its Subsidiaries of the direct or indirect sale of its Included Assets, the Equity Issuance or any other Transaction or compliance by such Jaguar Party or any of its Subsidiaries with any of the provisions of this Agreement or any Ancillary Document will (i) conflict with or result in any breach of any provision of such Jaguar Party’s or any of its Subsidiaries’ Governing Documents, (ii) require any filing by such Jaguar Party or any of its Subsidiaries with, or the obtaining of any permit, authorization, consent or approval of, any Governmental Entity (except for (x) compliance with any applicable requirements of the Exchange Act, (y) filings, permits, authorizations, consents, waiting period expirations or terminations, and approvals as may be required under the HSR Act or (z) such filings as may be required in connection with state and local transfer Taxes), (iii) automatically result in a modification, violation or breach of, or constitute (with or without notice or lapse of time or both) a default (or give rise to any right, including, but not limited to, any right of termination, amendment, cancellation or acceleration) under, any of the terms, conditions or provisions of any Jaguar Ground Lease, Jaguar Lease or other material contract to which such Jaguar Party or any of its Subsidiaries is a party or by which any of their Included Assets are bound, (iv) assuming that all consents, approvals, authorizations, waiting period expirations or terminations, and permits described in Section 4.3(ii)(y) have been obtained, and all filings and notifications described in Section 4.3(ii)(y) have been made, violate any order, writ, injunction, decree or Law applicable to such Jaguar Party or any of its Subsidiaries or any of their respective properties or assets, (v) require any consent or approval of, or notice to, any other Person, under any of the terms, conditions or provisions of (x) any Jaguar Ground Lease other than any Jaguar Ground Lease set forth in Section 4.3(v)(x) of the Jaguar Disclosure Letter (the “Required Jaguar Ground Lease Consents”), (y) any Joint Venture Agreement other than any Joint Venture Agreement set forth on Section 4.3(v)(y) of the Jaguar Disclosure Letter (the “Required Jaguar JV Consents”), or (z) any Contract constituting an Indebtedness obligation of such Jaguar Party or any of its Subsidiaries that relates to any of the Included Assets or pursuant to which Giants or any of its Subsidiaries (including, after the Closing, the Included Entities and the Jaguar Management Entities) could become an obligor pursuant to the Transactions other than any such Contract set forth on Section 4.3(v)(z) of the Jaguar Disclosure Letter (the “Required Jaguar Debt Consents”), or (vi) require any consent or approval of, or notice to, any other Person, including, without limitation, from limited partners, members or parties to leases or other agreements, except as to clauses (i), (ii), (iv) and (vi), respectively, for any such conflicts, violations, breaches, defaults or other occurrences which would not materially and adversely affect any Included Asset or Jaguar Management Entity or the consummation of any contribution or merger contemplated herein or in any Contribution Agreement or Merger Agreement.

 

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Section 4.4.                                                         Capital Structure; Subsidiaries.

 

(a)                                 Except as set forth on Section 4.4(a) of the Jaguar Disclosure Letter Jaguar, Operating Partners directly or indirectly wholly owns each of its Subsidiaries.  Other than through its Equity Interests in Jaguar Operating Partners, Jaguar Properties owns no Equity Interests in any Person.  As of the date hereof, with respect to each Jaguar Management Entity and each Subsidiary of each Jaguar Party, all of the outstanding Equity Interests have been duly authorized and validly issued and (i) in the case of outstanding shares of capital stock of any Subsidiary of such Jaguar Party that is a corporation, are fully paid and non-assessable and (ii) are free of preemptive or other similar rights under Law, any applicable organization document and any Contract or instrument to which such Jaguar Party or any of its Subsidiaries is a party or by which it is bound.

 

(b)                                 Except as set forth in Section 4.4(b) of the Jaguar Disclosure Letter, as of the date of this Agreement, there are no securities, options, warrants, calls, rights, commitments, agreements, rights of first refusal, arrangements or undertakings of any kind to which such Jaguar Party or any of its Subsidiaries is a party or by which any of them is bound, obligating such Jaguar Party or any of its Subsidiaries to issue, deliver or sell or create, or cause to be issued, delivered or sold or created, additional Equity Interests, phantom stock or other contractual rights, the value of which is determined in whole or in part by the value of any equity security of such Jaguar Party or any of its Subsidiaries or obligating such Jaguar Party or any of its Subsidiaries to issue, grant, extend or enter into any such security, option, warrant, call, right, commitment, agreement, right of first refusal, arrangement or undertaking.  Neither such Jaguar Party nor any of its Subsidiaries is a party to or bound by any agreements or understandings concerning the voting (including voting trusts and proxies) of any capital stock or other Equity Interests of such Jaguar Party or any of its Subsidiaries.

 

(c)                                  Section 4.4(c) of the Jaguar Disclosure Letter sets forth each Jaguar Funds’ direct or indirect percentage interests in the Jaguar Included Properties as of the date hereof and, subject to the exceptions set forth on Section 4.4(c) of the Jaguar Disclosure Letter and after giving effect to the Restructuring Transactions, such Jaguar Fund or the Legacy LLC of such Jaguar Fund will own not less than such percentage immediately prior to the consummation of the Closing except as adjusted or modified as permitted under this Agreement.  The Jaguar Funds own such percentage interests through the Included Entities.  Except as set forth on Section 4.4(c) of the Jaguar Disclosure Letter, each Subsidiary of Jaguar Operating Partners is and, immediately prior to the Closing, will be, directly or indirectly wholly owned, beneficially and of record by Jaguar Operating Partners and neither Jaguar Operating Partners nor any of its Subsidiaries owns directly or indirectly any other capital stock, limited liability company or partnership interest, joint venture interest or other Equity Interest in any other Person.

 

(d)                                 With regard to the Included Interests, all of the material capital obligations currently due and payable of any Jaguar Party and, to the knowledge of the Jaguar Parties, all of the material capital obligations currently due and payable of any Joint Venture Partner have been fully funded.  To the knowledge of the Jaguar Parties, no Joint Venture Partner has made or advanced any loans that would adversely impact the Giants’ share of distributions from the Joint Venture.

 

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(e)                                  Except with respect to the Included Interests to be acquired pursuant to Section 5.10(b), the Jaguar Parties own, directly or indirectly, beneficially and of record all of the Included Interests.  Each of the Persons on Section 4.4(e) of the Jaguar Disclosure Letter owns, directly or indirectly, beneficially and or record each of the Equity Interests in each of the Jaguar Management Entities and Fund IX REIT (other than any preferred interests in Fund IX REIT to be redeemed at or prior to Closing) set forth opposite his, her or its name on Section 4.4(e) of the Jaguar Disclosure Letter.  All of the Included Interests, Managing Member Interests and the Equity Interests in each of Jaguar Operating Partners, Jaguar Properties and Fund IX REIT, are duly authorized, validly issued (and with respect to any corporate Equity Interests, fully paid and non-assessable), and free and clear of all Liens, except for Jaguar Permitted Liens.  Immediately prior to the Closing, the Wanted LLCs will own beneficially and of record all of the Included Interests (other than any Included Interests set forth on Section 5.10(b) of the Jaguar Disclosure Letter, owned by Fund I, Fund II, Recap Investors, SEFC Investors and SEFC Partners and contributed to the Giants Parties at the Closing), free and clear of all Liens, except for Jaguar Permitted Liens. Immediately prior to the Closing, Fund I, Fund II, Recap Investors and SEFC Investors and SEFC Partners will own beneficially and of record all Included Interests not owned by the Wanted LLCs, free and clear of any Liens, except for Jaguar Permitted Liens. Upon the consummation of the transactions contemplated by the Merger Agreements and Contribution Agreements, the applicable Giants Parties will own beneficially and of record all of the Included Interests (other than any Kickout Interest) free and clear of any Liens, except for Jaguar Permitted Liens.

 

(f)                                   Each Equity Interest in each Subsidiary of a Jaguar Management Entity has been duly authorized, validly issued (and with respect to any corporate Equity Interests, fully paid and non-assessable), and is free and clear of any Liens, except as otherwise set forth in this Agreement.

 

(g)                                  As of the date hereof, (i) no right of first offer, buy/sell or similar right under any Joint Venture Agreement has been exercised by any Jaguar Party or any Subsidiary thereof, on the one hand, or any Joint Venture Partner, on the other hand, or is the exercise of any such right now pending or proposed and (ii) no Joint Venture has been dissolved or liquidated and not reconstituted in accordance with the applicable Joint Venture Agreement and no event or condition which would trigger or result in the dissolution or liquidation of a Joint Venture has occurred and is continuing without the reconstitution of such person in accordance with the applicable Joint Venture Agreement.

 

Section 4.5.                                                         Securities Laws Matters.

 

(a)                                 Such Jaguar Party acknowledges that the Issued OP Units and Issued Giants Shares have not been registered under the Securities Act or under any state securities Laws.  Such Jaguar Party acknowledges (on behalf of itself and its Jaguar Designees) that the Issued OP Units and Issued Giants Shares to be acquired by such Jaguar Party or any of its Subsidiaries pursuant hereto are “restricted securities” as that term is defined by Rule 144(a)(3) under the Securities Act and under applicable state securities Laws and that, pursuant to such Laws, such Jaguar Party and its Jaguar Designees must hold such Issued OP Units and Issued Giants Shares until they are registered with the SEC and qualified by state authorities, or an exemption from such registration and qualification requirements is available and, other than as

 

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set forth in the Registration Rights Agreements, the Giants Parties have no obligation to register or qualify such units or shares for resale.

 

(b)                                 Such Jaguar Party (i) acknowledges that it or any of its Subsidiaries is acquiring the Issued OP Units and Issued Giants Shares pursuant to an exemption from registration under the Securities Act solely for investment with no present intention to distribute any of the Issued OP Units and Issued Giants Shares to any Person in violation of applicable securities Laws, (ii) will not sell or otherwise dispose of any of the Issued OP Units and Issued Giants Shares, except in compliance with the registration requirements or exemption provisions of the Securities Act and any other applicable securities Laws, (iii) is an “accredited investor” (as that term is defined by Rule 501(a) of Regulation D under the Securities Act), and (iv) (x) has had access to and has received such financial and other information regarding the Jaguar Parties, the Operating Partnership, the Issued Giants Shares and/or the Issued OP Units, as applicable, that it deems necessary to make an informed investment decision regarding such Issued OP Units and Issued Giants Shares and (y) can bear the economic risk of an investment in the Issued OP Units and/or Issued Giants Shares indefinitely.  Such Jaguar Party will have obtained questionnaires from each of its Jaguar Designees to which the Issued OP Units and Issued Giants Shares will be issued, which questionnaires shall contain, for the benefit of Giants and the Operating Partnership (as applicable), acknowledgements with respect to the matters covered in Section 4.5(a) and written representations from each such Jaguar Designee to the effect that that such Jaguar Designee is an “accredited investor” (as that term is defined by Rule 501(a) of Regulation D under the Securities Act) and that the preceding representations and warranties in this Section 4.5(b) are otherwise true, complete and correct with respect to such Jaguar Designee.  To the knowledge of such Jaguar Party, each such questionnaire is true, complete and correct.

 

(c)                                  Each Jaguar Party acknowledges that the Issued OP Units and Issued Giants Shares to be acquired by such Jaguar Party and its Jaguar Designees pursuant hereto, if certificated, shall bear the following legends (in addition to any legend required under applicable state securities Laws):

 

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND MAY NOT BE ENCUMBERED, PLEDGED, HYPOTHECATED, SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF WITHIN THE UNITED STATES EXCEPT PURSUANT TO THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS AND, IN EACH CASE, IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS.”

 

(d)                                 In addition, such Jaguar Party acknowledges that the Issued Giants Shares are subject to restrictions on ownership and transfer set forth in the Giants Charter, and the Giants Shares to be acquired by such Jaguar Party and its Jaguar Designees pursuant hereto, if certificated, shall bear the following legends, or such other legend as may be required from time to time by the Giants Charter:

 

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“THE SECURITIES OF GIANTS (THE “COMPANY”) ARE SUBJECT TO RESTRICTIONS ON BENEFICIAL AND CONSTRUCTIVE OWNERSHIP AND TRANSFER FOR THE PURPOSE, AMONG OTHERS, OF THE COMPANY’S MAINTENANCE OF ITS STATUS AS A REAL ESTATE INVESTMENT TRUST UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”).  SUBJECT TO CERTAIN FURTHER RESTRICTIONS AND EXCEPT AS EXPRESSLY PROVIDED IN THE COMPANY’S CHARTER, (i) NO PERSON MAY BENEFICIALLY OR CONSTRUCTIVELY OWN SHARES IN EXCESS OF 9.8% OF THE VALUE OF THE TOTAL OUTSTANDING SHARES OR 9.8% (IN VALUE OR IN NUMBER OF SHARES, WHICHEVER IS MORE RESTRICTIVE) OF ANY CLASS OR SERIES OF SHARES UNLESS SUCH PERSON IS AN EXCEPTED HOLDER (IN WHICH CASE THE EXCEPTED HOLDER LIMIT SHALL BE APPLICABLE); (ii) NO PERSON MAY BENEFICIALLY OR CONSTRUCTIVELY OWN SHARES THAT WOULD RESULT IN THE COMPANY BEING “CLOSELY HELD” UNDER SECTION 856(h) OF THE CODE OR OTHERWISE CAUSE THE COMPANY TO FAIL TO QUALIFY AS A REIT; AND (iii) ANY TRANSFER OF SHARES THAT, IF EFFECTIVE, WOULD RESULT IN THE SHARES BEING BENEFICIALLY OWNED BY FEWER THAN 100 PERSONS (AS DETERMINED UNDER THE PRINCIPLES OF SECTION 856(a)(5) OF THE CODE) SHALL BE VOID AB INITIO AND THE INTENDED TRANSFEREE SHALL ACQUIRE NO RIGHTS IN SUCH SHARES.  ANY PERSON WHO BENEFICIALLY OR CONSTRUCTIVELY OWNS OR ATTEMPTS TO BENEFICIALLY OR CONSTRUCTIVELY OWN SHARES WHICH CAUSES OR WILL CAUSE A PERSON TO BENEFICIALLY OR CONSTRUCTIVELY OWN SHARES IN EXCESS OR IN VIOLATION OF THE ABOVE LIMITATIONS MUST IMMEDIATELY NOTIFY THE COMPANY IN WRITING (OR, IN THE CASE OF AN ATTEMPTED TRANSACTION, GIVE AT LEAST 15 DAYS PRIOR WRITTEN NOTICE).  IF ANY OF THE RESTRICTIONS ON TRANSFER OR OWNERSHIP AS SET FORTH IN (i) AND (ii) ABOVE ARE VIOLATED, THE SHARES IN EXCESS OR IN VIOLATION OF THE ABOVE LIMITATIONS WILL BE AUTOMATICALLY TRANSFERRED TO A TRUSTEE OF A TRUST FOR THE BENEFIT OF ONE OR MORE CHARITABLE BENEFICIARIES.  IN ADDITION, THE COMPANY MAY REDEEM SHARES UPON THE TERMS AND CONDITIONS SPECIFIED BY THE BOARD IN ITS SOLE DISCRETION IF THE BOARD DETERMINES THAT OWNERSHIP OR A TRANSFER OR OTHER EVENT MAY VIOLATE THE RESTRICTIONS DESCRIBED ABOVE.  FURTHERMORE, UPON THE OCCURRENCE OF CERTAIN EVENTS, ATTEMPTED TRANSFERS IN VIOLATION OF THE RESTRICTIONS DESCRIBED ABOVE MAY BE VOID AB INITIO.  ALL CAPITALIZED TERMS IN THIS NOTICE HAVE THE MEANINGS DEFINED IN THE COMPANY’S CHARTER, AS THE SAME MAY BE AMENDED FROM TIME TO TIME, A COPY OF WHICH, INCLUDING THE RESTRICTIONS ON TRANSFER AND OWNERSHIP, WILL BE FURNISHED TO EACH HOLDER OF SHARES ON REQUEST AND WITHOUT CHARGE.  REQUESTS FOR SUCH A COPY MAY BE DIRECTED TO THE SECRETARY OF THE COMPANY AT ITS PRINCIPAL OFFICE.”

 

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Section 4.6.                                                         Financial Statements; Working Capital.

 

(a)                                 The Jaguar Parties have delivered to Giants (i) a copy of the audited consolidated balance sheets and the related consolidated statements of operations and comprehensive income, consolidated statements of changes in partners’ deficit and consolidated statements of cash flows as of and for the fiscal years ended December 31, 2015, 2014 and 2013 and the unaudited consolidated balance sheet as of March 31, 2016 and the related consolidated statements of operations and comprehensive income, consolidated statements of changes in partners’ deficit and consolidated statements of cash flows as of and for the three months ended March 31, 2016 and 2015 (the “Jaguar Operating Partners Financial Statements”); (ii) a copy of the audited balance sheet of the JBG/Rosenfeld Retail Properties, LLC and the related statements of operations and comprehensive income, statements of changes in partners’ deficit and statements of cash flows as of and for the fiscal years ended December 31, 2015 and 2014 (the “Jaguar Retail Financial Statements”); and (iii) the audited combined statements of revenues and expenses from real estate operations of the Jaguar Included Properties listed on Section 4.6(a)(iii) of the Jaguar Disclosure Letter for the years ended December 31, 2015, 2014 and 2013 and the unaudited combined statements of revenues and expenses from real estate operations of the Jaguar Included Properties listed on Section 4.6(a)(iii) of the Jaguar Disclosure Letter for the three months ended March 31, 2016 (the “3-14 Financial Statements” and together with the Jaguar Operating Partners Financial Statements and the Jaguar Retail Financial Statements, collectively, the “Jaguar Financial Statements”).  The Jaguar Financial Statements (x) have been prepared from the books and records of the Jaguar Parties and their Subsidiaries (as applicable), (y) have been prepared in accordance with GAAP applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto or, in the case of interim financial statements, for normal and recurring year-end adjustments), and (z) with respect to the Jaguar Operating Partners Financial Statements, fairly present, in all material respects, the financial position and the results of operations of Jaguar Operating Partners and its subsidiaries, with respect to the Jaguar Retail Financial Statements, fairly present, in all material respects, the financial position and the results of operations of JBG/Rosenfeld Retail Properties, LLC and with respect to the 3-14 Financial Statements, fairly present, in all material respects, the revenues and expenses from the real estate operations presented therein as of the times and for the periods referred to therein (subject, in the case of unaudited quarterly financial statements, to normal year-end adjustments).

 

(b)                                 The Roll-Forward Pro Forma March 31, 2016 Cash Flow Calculation has been prepared from the books and records of the Included Entities and fairly presents, in all material respects, the revenues and expenses from the real estate operations of the Included Entities presented therein during such period.  Since March 31, 2016, none of the Jaguar Parties nor any of their Subsidiaries has taken any action that would be restricted by Section 5.20(b) if such limitation would have been in effect since March 31, 2016.

 

Section 4.7.                                                         No Undisclosed Liabilities.  Neither the Included Entities nor the Jaguar Management Entities has any liabilities or obligations of any nature (whether accrued, contingent or otherwise) which are required by GAAP to be reflected in a consolidated balance sheet, except for liabilities or obligations (a) reflected or reserved against on the most recent balance sheet included in the Jaguar Operating Partners Financial Statements and the Jaguar Retail Financial Statements, (b) under the Indebtedness disclosed in Section 4.16(a)(v) of the Jaguar Disclosure Letter, (c) under the Jaguar Leases and Jaguar Ground Leases, (d) incurred in the ordinary course of business consistent with past practice since March 31, 2016, (e) set forth

 

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on Section 4.7 of the Jaguar Disclosure Letter, (f) expressly contemplated by, or arising out of, or under this Agreement, or (g) that, individually or in the aggregate, have not had and would not reasonably be expected to have a Jaguar Material Adverse Effect.

 

Section 4.8.                                                         Absence of Certain Changes or Events.  Since December 31, 2015, except as contemplated by this Agreement or as set forth in Section 4.8 of the Jaguar Disclosure Letter, (a) each Jaguar Management Entity, and with respect to the Included Assets each Jaguar Fund and its Subsidiaries have conducted their businesses in the ordinary course consistent with past practice in all material respects and (b) there has not been any Jaguar Material Adverse Effect.

 

Section 4.9.                                                         Jaguar Included Properties.

 

(a)                                 Section 4.9(a)(i) of the Jaguar Disclosure Letter sets forth a list of (i) the street address of each Jaguar Included Property, and (ii) whether such Jaguar Party or its Subsidiary directly or indirectly owns such Jaguar Included Property in fee simple or directly or indirectly holds such Jaguar Included Property pursuant to a leasehold, ground leasehold or some other property interest.  With respect to each Jaguar Party, Section 4.9(a)(i) of the Jaguar Disclosure Letter sets forth a true, complete and correct list of all Jaguar Included Properties in which such Jaguar Party owns a direct or indirect interest.  Except as expressly set forth in Section 4.9(a)(ii) of the Jaguar Disclosure Letter, as of the date hereof, neither such Jaguar Party nor its Subsidiaries is obligated to buy or sell any Jaguar Included Properties at some future date, or otherwise enter into any contract for sale, ground lease or letter of intent to sell or ground lease any such Jaguar Included Property or any portion thereof.

 

(b)                                 Such Jaguar Party and its Subsidiaries owns fee simple title or leasehold title (as applicable) to each of their respective Jaguar Included Properties, in each case, free and clear of Liens, except for Jaguar Permitted Liens.  Except as set forth on Section 4.9(b) of the Jaguar Disclosure Letter, such Jaguar Party and its Subsidiaries have not granted, and to the knowledge of such Jaguar Party, none of its or its Subsidiaries’ Jaguar Included Properties is subject to, unexpired option to purchase agreements, rights of first refusal or first offer or any other rights to purchase or otherwise acquire any Jaguar Included Property of such Jaguar Party or its Subsidiaries or any portion thereof.

 

(c)                                  To the knowledge of such Jaguar Party, except as may be disclosed in the third party physical condition reports with respect to its and its Subsidiaries’ Jaguar Included Properties which have been delivered or otherwise made available to the Giants Parties (it being understood and agreed that a reference in a physical condition report to a document not otherwise delivered or made available to the Giants Parties shall not be deemed to constitute disclosure of the contents of such document), as of the date hereof, with respect to each Jaguar Included Property of such Jaguar Party and its Subsidiaries, (i) such Jaguar Included Property is supplied with utilities and other services as necessary to permit its continued operation as it is now being operated and (ii) such Jaguar Included Property is in good working order sufficient for its normal operation in the manner currently being conducted, in each case, except as has not had and would not reasonably be expected to have a Jaguar Material Adverse Effect; provided, however, that this Section 4.9(c) shall be understood not to include Included Properties that are Jaguar Development Properties.

 

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(d)           Neither such Jaguar Party or any of its Subsidiaries has received (i) written notice that any certificate, permit or license from any Governmental Entity having jurisdiction over any of its Jaguar Included Properties necessary to permit the lawful use and operation of the buildings and improvements on any of its Jaguar Included Properties as currently used and operated or that is necessary to permit the lawful use and operation of all utilities and means of egress and ingress to and from any of its Jaguar Included Properties for the current use and operation of the Jaguar Included Property is not in full force and effect as of the date of this Agreement, except for such failures to be in full force and effect that, individually or in the aggregate, would not reasonably be expected to have a Jaguar Material Adverse Effect, or of any pending written threat of modification or cancellation of any of same, that would reasonably be expected to have a Jaguar Material Adverse Effect, or (ii) written notice of any uncured violation of any Laws affecting any of its Jaguar Included Properties which, individually or in the aggregate, has had or would reasonably be expected to have a Jaguar Material Adverse Effect.

 

(e)           Except as set forth in Section 4.9(e) of the Jaguar Disclosure Letter, no condemnation, eminent domain or similar proceeding has occurred or to the knowledge of such Jaguar Party is pending with respect to any Jaguar Included Property of such Jaguar Party or any of its Subsidiaries and, except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Jaguar Material Adverse Effect, neither such Jaguar Party nor any of its Subsidiaries has received any written notice to the effect that (i) any condemnation or rezoning proceedings are threatened with respect to any of its Jaguar Included Properties, or (ii) any zoning regulation or ordinance (including with respect to parking), Board of Fire Underwriters rules, building, fire, health or other Law has been violated (and remains in violation) for any of its Jaguar Included Properties.

 

(f)            Except as set forth on Section 4.9(f) of the Jaguar Disclosure Letter, there are no material Tax abatements or exemptions specifically affecting the Jaguar Included Properties of such Jaguar Party or any of its Subsidiaries, and such Jaguar Party and its Subsidiaries have not received any written notice of (and such Jaguar Party and its Subsidiaries do not have any knowledge of) any proposed increase in the assessed valuation of any of the Jaguar Included Properties, except in each case for any such Taxes or assessment that have not had and would not reasonably be expected to have, individually or in the aggregate, a Jaguar Material Adverse Effect.

 

(g)           Such Jaguar Party and each of its Subsidiaries, as applicable, is in possession of all title insurance policies evidencing title insurance with respect to each of their Jaguar Included Properties (each, a “Jaguar Title Policy” and, collectively, the “Jaguar Title Policies”).  A copy of each Jaguar Title Policy in the possession or control of such Jaguar Party and its Subsidiaries has been made available to the Giants Parties if such Jaguar Title Policy was specifically requested by the Giants Parties with respect to such Jaguar Included Property in a writing which specifically referenced such Jaguar Included Property.  No written unresolved claim has been made against any Jaguar Title Policy, which, individually or in the aggregate, would be material to any Jaguar Included Property.

 

(h)           Section 4.9(h) of the Jaguar Disclosure Letter sets forth all ground leases affecting the interest of each Jaguar Party or its Subsidiaries in any Jaguar Included Property and all amendments, modifications (including pursuant to any estoppel), guarantees, renewals and

 

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extensions exercised related thereto (collectively, the “Jaguar Ground Leases”).  With respect to each Jaguar Party, such Jaguar Party hereby represents that (i) Section 4.9(h) of the Jaguar Disclosure Letter contains a true, complete and correct list of all Jaguar Ground Leases to which such Jaguar Party or any of its Subsidiaries is bound; (ii) true, complete and correct copies of such Jaguar Ground Leases have been delivered or made available to the Giants Parties; and (iii) each such Jaguar Ground Lease is valid, binding and enforceable in accordance with its terms and is in full force and effect with respect to such Jaguar Party or its Subsidiary and, to the knowledge of such Jaguar Party, with respect to the other parties thereto, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting creditors’ rights generally and by general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at Law).  As of the date hereof, there are no monetary defaults under any Jaguar Ground Lease to which such Jaguar Party or any of its Subsidiaries is bound, by such Jaguar Party or its Subsidiaries or any other party thereto.  As of the date hereof, such Jaguar Party and its Subsidiaries have not sent or received any notice of any violation or breach of, or default under, any Jaguar Ground Lease to which such Jaguar Party or any of its Subsidiaries is bound.

 

(i)            The rent rolls for each of the Jaguar Included Properties as of May 9, 2016 are set forth in the Jaguar Data Room under the folder “Section 4.9(i)_Rent Rolls as of 05.09.16” (including an indication of whether any Jaguar Included Property is subject to net leases), and except for discrepancies, errors or omissions that are, individually or in the aggregate, not material, are true and correct and (i) correctly reference each tenant under each lease that was in effect as of May 9, 2016, and to which any Jaguar Party is a party as lessor with respect to each of the Jaguar Included Properties (all leases (including any net leases), together with, in the case of Jaguar Leases for non-residential Jaguar Included Properties, for all amendments, modifications, supplements, renewals and extensions related thereto, the “Jaguar Leases”) and (ii) identify the rent payable under the Jaguar Lease as of such date.

 

(j)            True and complete (in all material respects) copies of all Jaguar Leases for space in excess of 25,000 square feet in or at any Jaguar Included Properties (the “Material Jaguar Leases”), in each case in effect as of the date hereof, have been made available to the Giants Parties.  Except as would not, individually or in the aggregate, reasonably be expected to have a Jaguar Material Adverse Effect, (i) neither such Jaguar Party nor any of its Subsidiaries has given or received written notice of any violation or breach of, or default under, any Jaguar Lease, (ii) except as set forth on Section 4.9(j) of the Jaguar Disclosure Letter, no tenant under a Jaguar Lease is in monetary default under such Jaguar Lease, and (iii) each Jaguar Lease is valid, binding and enforceable in accordance with its terms and is in full force and effect with respect to any Jaguar Party and, to the knowledge of any Jaguar Party, with respect to the other parties thereto, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting creditors’ rights generally and by general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at Law).  Except as set forth on Section 4.9(j) of the Jaguar Disclosure Letter, any and all material leasing commissions or brokerage fees payable by such Jaguar Party or any of its Subsidiaries with respect to any Material Jaguar Leases have been paid in full.  Such Jaguar Party has provided to the Giants Parties the aggregate security deposit amount currently held by such Jaguar Party or any of its Subsidiaries under Jaguar Leases.

 

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(k)           Other than any economic rights assigned to an Included Entity or the Jaguar Management Entities, the Managing Member Interests do not include any economic rights in any Joint Venture to which such Managing Member Interests are attributable, except as set forth on Section 4.9(k) of the Jaguar Disclosure Letter.

 

(l)            As of the date hereof, the Jaguar Included Properties and the Excluded Assets constitute all of the real property interests held by the Jaguar Parties and their controlled Affiliates.

 

(m)          Except as (i) set forth on Section 4.9(m) of the Jaguar Disclosure Letter and (ii) by virtue of their interest in the Management Entities, no member of the executive committee of Jaguar Operating Partners is entitled to receive compensation for providing development, asset and property management, leasing, construction management or other real estate-related services.

 

Section 4.10.                 Jaguar Development Properties.

 

(a)           Section 4.10(a) of the Jaguar Disclosure Letter (i) lists each Jaguar Included Property (x) which is under construction or (y) which such Jaguar Party expects to be in a position to commence construction by March 31, 2018 (each, a “Jaguar Development Property”) and (ii) sets forth the estimated completion date for each Jaguar Development Property.

 

(b)           Except as would not materially affect any Jaguar Development Property, to the knowledge of such Jaguar Party, no circumstances exist that would (i) prevent or unreasonably delay the development or construction of any of its or its Subsidiaries’ Jaguar Development Properties or (ii) prevent or unreasonably delay the attainment of any entitlements required to commence or complete construction or development of such Jaguar Development Properties, in each case, in accordance with the estimated completion date set forth on Section 4.10(a) of the Jaguar Disclosure Letter, subject, in the case of any Jaguar Development Property where the development or construction is not “by right” to, (A) any delays in the receipt of all required approvals, (B) failure to receive all required approvals and (C) receipt of approvals with conditions that are unacceptable to the applicable Jaguar Party in its good faith business discretion.

 

(c)           Except as would not reasonably be expected to have, in the aggregate, a Jaguar Material Adverse Effect, (i) all development and construction required to be completed with respect to any Jaguar Development Property (and any Contract related to such development or construction) (A) has been completed timely and on budget (or such requirement has been waived by the party benefiting from such covenant), or (B) is on schedule to be completed timely and on budget, and all payments, expenses and fees required in connection therewith have been made, in each case, in accordance therewith and (ii) neither such Jaguar Party nor any of its Subsidiaries is and, to the knowledge of such Jaguar Party, no other party is in breach or violation of, or default under, any such Jaguar Lease or Contract related to such development or construction, nor has any event occurred which would result in a breach or violation of, or a default under, any such Jaguar Lease or Contract by such Jaguar Party or any of its Subsidiaries,

 

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or, to the knowledge of such Jaguar Party, any other party thereto (in each case, with or without notice or lapse of time or both).

 

Section 4.11.                 Personal Property.  Such Jaguar Party and its Subsidiaries have good and valid title to, or a valid and enforceable leasehold interest in, or other right to use, all personal property owned, used or held for use by them which constitutes part of the “Included Assets” (other than property owned by tenants and used or held in connection with the applicable tenancy), except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Jaguar Material Adverse Effect.  Neither such Jaguar Party’s nor any of its Subsidiaries’ ownership of or leasehold interest in any such personal property is subject to any Liens, except for Jaguar Permitted Liens and Liens that have not had and would not reasonably be expected to have a Jaguar Material Adverse Effect.

 

Section 4.12.                 Litigation.  Except as set forth in Section 4.12 of the Jaguar Disclosure Letter, as of the date hereof, there is no Action, pending against (or to the knowledge of such Jaguar Party, threatened in writing against), such Jaguar Party, any of its Subsidiaries or their Included Assets nor, to the knowledge of such Jaguar Party, is there any investigation by a Governmental Entity pending or threatened in writing against such Jaguar Party or any of its Subsidiaries or, with respect to any Included Assets of such Jaguar Party or its Subsidiaries, other than as have not had and would not reasonably be expected to have a Jaguar Material Adverse Effect.  As of the date hereof, neither such Jaguar Party nor any of its Subsidiaries is subject to any outstanding order, writ, injunction, decree or arbitration ruling or judgment or award of a Governmental Entity which has had or would reasonably be expected to have, individually or in the aggregate, a Jaguar Material Adverse Effect or which would reasonably be expected to adversely affect the ability of such Jaguar Party or any of its Subsidiaries to perform their obligations hereunder or under any Ancillary Documents to which such Persons are a party, or prevent or materially delay the consummation of the Transactions.

 

Section 4.13.                 Taxes.  Except as expressly set forth in Section 4.13 of the Jaguar Disclosure Letter:

 

(a)           The Jaguar Parties and their Subsidiaries have each (i) duly and timely filed (or caused to be filed on its behalf) with the appropriate Governmental Entity all U.S. federal and all other material Tax Returns required to be filed by them, taking into account any extensions of time within which to file such Tax Returns, and all such Tax Returns were and are true, correct and complete and (ii) duly and timely paid in full (or there has been duly and timely paid in full on its behalf), or made adequate provision for, all material amounts of Taxes required to be paid by it.

 

(b)           Fund VII REIT (i) for its taxable years commencing with Fund VII REIT’s taxable year that ended on December 31, 2012 and through and including its taxable year ended December 31, 2015 (and, for purposes of Section 7.2(a), through and including its taxable year ended December 31, 2016, if the Closing Date occurs in the taxable year ending December 31, 2017) has been subject to taxation as a REIT and has satisfied all requirements to qualify as a REIT for such taxable years; (ii) has operated since January 1, 2016 (and, for purposes of Section 7.2(a), January 1, 2017, if the Closing Date occurs in the taxable year ending December 31, 2017) to the date hereof in such a manner so as to qualify as a REIT; (iii) intends

 

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to continue to operate through the Closing Date in such a manner so as to qualify as a REIT; and (iv) has not taken or omitted to take any action that would reasonably be expected to result in a challenge by the IRS or any other Governmental Entity to its status as a REIT, and no such challenge is pending or threatened in writing.

 

(c)           Fund VIII REIT (i) for its taxable years commencing with Fund VIII REIT’s taxable year that ended on December 31, 2011 and through and including its taxable year ended December 31, 2015 (and, for purposes of Section 7.2(a), through and including its taxable year ended December 31, 2016, if the Closing Date occurs in the taxable year ending December 31, 2017) has been subject to taxation as a REIT and has satisfied all requirements to qualify as a REIT for such taxable years; (ii) has operated since January 1, 2016 (and, for purposes of Section 7.2(a), January 1, 2017, if the Closing Date occurs in the taxable year ending December 31, 2017) to the date hereof in such a manner so as to qualify as a REIT; (iii) intends to continue to operate through the Closing Date in such a manner so as to qualify as a REIT; and (iv) has not taken or omitted to take any action that would reasonably be expected to result in a challenge by the IRS or any other Governmental Entity to its status as a REIT, and no such challenge is pending or threatened in writing.

 

(d)           Fund IX REIT (i) for its taxable years commencing with Fund IX REIT’s taxable year that ended on December 31, 2014 and through and including its taxable year ended December 31, 2015 (and, for purposes of Section 7.2(a), through and including its taxable year ended December 31, 2016, if the Closing Date occurs in the taxable year ending December 31, 2017) has been subject to taxation as a REIT and has satisfied all requirements to qualify as a REIT for such taxable years; (ii) has operated since January 1, 2016 (and, for purposes of Section 7.2(a), January 1, 2017, if the Closing Date occurs in the taxable year ending December 31, 2017) to the date hereof in such a manner so as to qualify as a REIT; (iii) intends to continue to operate through the effective time of the merger of the Fund IX REIT as set forth in Section 1.1(g)(ii) and the relevant Merger Agreement in such a manner so as to qualify as a REIT; and (iv) has not taken or omitted to take any action that would reasonably be expected to result in a challenge by the IRS or any other Governmental Entity to its status as a REIT, and no such challenge is pending or threatened in writing.

 

(e)           The Atlantic REIT and each Core REIT (i) for its taxable years commencing with its taxable year that ended on December 31 of the year for which it made its initial REIT election pursuant to Section 856(c)(1) of the Code and through and including its taxable year ended December 31, 2015 (and, for purposes of Section 7.2(a), through and including its taxable year ended December 31, 2016, if the Closing Date occurs in the taxable year ending December 31, 2017) has been subject to taxation as a REIT and has satisfied all requirements to qualify as a REIT for such taxable years; (ii) has operated since January 1, 2016 (and, for purposes of Section 7.2(a), January 1, 2017, if the Closing Date occurs in the taxable year ending December 31, 2017) to the date hereof in such a manner so as to qualify as a REIT; (iii) intends to continue to operate through the Closing Date in such a manner so as to qualify as a REIT; and (iv) has not taken or omitted to take any action that would reasonably be expected to result in a challenge by the IRS or any other Governmental Entity to its status as a REIT, and no such challenge is pending or threatened in writing.

 

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(f)            The Jaguar Parties and their Subsidiaries, other than the Jaguar Corporate Entities, has each been since the later of its acquisition or formation and continues to be treated for U.S. federal Tax purposes as a partnership (or a disregarded entity (other than a Qualified REIT Subsidiary)) and not as a corporation or an association or publicly traded partnership taxable as a corporation.

 

(g)           None of the Jaguar Parties nor any of their Subsidiaries holds, directly or indirectly, any asset the disposition of which would be subject to (or to rules similar to) Section 1374 of the Code.

 

(h)           (i) There are no audits, investigations or proceedings pending (or threatened in writing) for and/or in respect of any material Taxes or material Tax Returns of a Jaguar Party or any of their Subsidiaries and none of the Jaguar Parties nor any of their Subsidiaries is a party to any litigation or administrative proceeding relating to Taxes; (ii) no deficiency for Taxes of the Jaguar Parties or any of their Subsidiaries has been claimed, proposed or assessed in writing or, to the knowledge of the Jaguar Parties, threatened in writing, by any Governmental Entity, which deficiency has not yet been settled, except for such deficiencies which are being contested in good faith; (iii) none of the Jaguar Parties nor any of their Subsidiaries has extended or waived (nor granted any extension or waiver of) the limitation period for the assessment or collection of any Tax that has not since expired; and (iv) none of the Jaguar Parties nor any of their Subsidiaries has entered into any “closing agreement” as described in Section 7121 of the Code (or any corresponding or similar provision of state, local or foreign income Tax Law).

 

(i)            Since formation of the Jaguar REITs, (i) none of the Jaguar REITs nor any of their Subsidiaries has incurred any material liability for Taxes under Sections 857(b), 860(c) or 4981 of the Code which have not been previously paid; and (ii) none of the Jaguar REITs nor any of their Subsidiaries has incurred any material liability for any other Taxes other than (x) in the ordinary course of business, or (y) transfer or similar Taxes arising in connection with acquisitions or dispositions of property.  No event has occurred, and no condition or circumstance exists, which presents a material risk that any material amount of Tax described in the previous sentence will be imposed upon the Jaguar REITs or any of their Subsidiaries.

 

(j)            The Jaguar Parties and each of their Subsidiaries have complied in all material respects with all applicable Laws relating to the payment and withholding of Taxes (including withholding of Taxes pursuant to Sections 1441, 1442, 1445, 1446 and 3402 of the Code or similar provisions under any state and foreign Laws) and have duly and timely withheld and, in each case, have paid over to the appropriate Governmental Entities any and all material amounts required to be so withheld and paid over on or prior to the due date thereof under all applicable Laws.

 

(k)           None of the Jaguar Parties is a “foreign person” within the meaning of Treasury Regulations Section 1.1445-2.

 

(l)            There are no Jaguar Tax Protection Agreements (as hereinafter defined) in force as of the date of this Agreement, and, as of the date of this Agreement, no Person has raised in writing a material claim against the Jaguar Parties or any of their Subsidiaries for any breach

 

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of any Jaguar Tax Protection Agreement.  As used herein, “Jaguar Tax Protection Agreement” means any written agreement to which the Jaguar Parties or any of their Subsidiaries is a party pursuant to which:  (i) any liability to holders of limited partnership interests in a Jaguar Subsidiary Partnership relating to Taxes may arise, whether or not as a result of the consummation of the Transactions; and/or (ii) in connection with the deferral of income Taxes of a holder of limited partnership interests in a Jaguar Subsidiary Partnership, the Jaguar Parties or any of their Subsidiaries have agreed to (A) maintain a minimum level of debt, continue a particular debt or provide rights to guarantee debt, (B) retain or not dispose of assets for a period of time that has not since expired, (C) make or refrain from making Tax elections, and/or (D) only dispose of assets in a particular manner.  As used herein, “Jaguar Subsidiary Partnership” means a Jaguar Party or a Subsidiary of a Jaguar Party that is a partnership for United States federal income tax purposes.

 

(m)          Section 4.13(m) of the Jaguar Disclosure Letter sets forth, for each Included Asset, the relevant Jaguar Party’s adjusted tax basis in such Included Asset.

 

(n)           There are no material Tax Liens upon any property or assets of the Jaguar Parties or any of their Subsidiaries except Liens for Taxes not yet due and payable or that are being contested in good faith by appropriate proceedings and for which adequate reserves have been established in accordance with GAAP.

 

(o)           Neither the Jaguar Parties nor any of their Subsidiaries (A) has been a member of an affiliated group filing a consolidated U.S. federal income Tax Return or (B) has any liability for the Taxes of any Person (other than the Jaguar Parties or any of their Subsidiaries) under Treasury Regulations Section 1.1502-6 (or any similar provision of state, local or foreign law), as a transferee or successor, or otherwise.

 

(p)           Neither the Jaguar Parties nor any of their Subsidiaries has participated in any “listed transaction” within the meaning of Treasury Regulations Section 1.6011-4(b)(2).

 

(q)           Neither the Jaguar Parties nor any of their Subsidiaries has constituted either a “distributing corporation” or a “controlled corporation” (within the meaning of Section 355(a) of the Code) in a distribution of stock qualifying for tax-free treatment under Section 355 of the Code in the two (2) years prior to the date of this Agreement.

 

(r)            None of the Jaguar REITs nor any of their Subsidiaries (other than Taxable REIT Subsidiaries) currently has or, as of December 31 of any taxable year through and including the taxable year ended December 31 immediately prior to the Closing Date, has had any earnings and profits attributable to such entity or any other corporation in any non-REIT year within the meaning of Section 857(a) of the Code.

 

Section 4.14.                 Compliance with Laws; Permits.

 

(a)           As of the date hereof (i) such Jaguar Party and its Subsidiaries, have complied and are in compliance with all Laws applicable to such Jaguar Party or any of its Subsidiaries or by which their Included Assets (including, without limitation, any Jaguar Included Property) is bound, and (ii) no notice, charge or assertion has been received by such Jaguar Party or its Subsidiaries or, to the knowledge of such Jaguar Party, threatened against

 

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such Jaguar Party or its Subsidiaries alleging any non-compliance of any Jaguar Party or its Subsidiaries, except in each case above for such non-compliance that has not had and would not reasonably be expected to have a Jaguar Material Adverse Effect.  Notwithstanding anything to the contrary in this Section 4.14(a), the provisions of this Section 4.14(a) shall not apply to matters covered by Section 4.17 (Environmental Matters).

 

(b)           Such Jaguar Party and its Subsidiaries are in possession of all authorizations, licenses, permits, certificates, approvals, variances, exemptions, orders, franchises, certifications and clearances of any Governmental Entity necessary for such Jaguar Party and its Subsidiaries to own, lease and operate their respective Included Assets (including, without limitation, the Jaguar Included Properties) and conduct their respective businesses as currently conducted (the “Jaguar Permits”), and all such Jaguar Permits are valid, and in full force and effect, except where the failure to possess and maintain such Jaguar Permits in full force and effect have not had and would not reasonably be expected to have a Jaguar Material Adverse Effect.  All applications required to have been filed for the renewal of the Jaguar Permits have been filed on a timely basis with the appropriate Governmental Entity, and all other filings required to have been made with respect to such Jaguar Permits have been duly made on a timely basis with the appropriate Governmental Entity, except in each case, where such failure to do so, individually or in the aggregate, has not had and would not reasonably be expected to have a Jaguar Material Adverse Effect.  Neither any Jaguar Party nor any of their Subsidiaries has received any claim or notice, nor has any knowledge indicating, that such Jaguar Party or its Subsidiaries currently is not in compliance with the terms of any Jaguar Permit, except where the failure to be in compliance with the terms of any such Jaguar Permit, individually or in the aggregate, would not have had and would not reasonably be expected to have a Jaguar Material Adverse Effect.

 

(c)           Neither such Jaguar Party nor any of its Subsidiaries are required to be a registered “Investment Company” under the Investment Company Act.

 

Section 4.15.                 Funds.

 

(a)           The Equity Interests of such Jaguar Party and any of its Subsidiaries have been issued and sold in compliance with applicable Law in all material respects.

 

(b)           Neither of the Jaguar Management Entities nor any of its Subsidiaries or any managing member of any Jaguar Fund currently acts as an adviser, sub-adviser, general partner, managing member, manager or sponsor to any pooled investment vehicle that would be required to be a registered “Investment Company” under the Investment Company Act.  Section 4.15(b)(i) of the Jaguar Disclosure Letter sets forth each material agreement pursuant to which such Jaguar Management Entity (or its Subsidiaries) performs management, advisory or sub-advisory services for any Person, and each material Contract pursuant to which such Jaguar Management Entity (or its Subsidiaries) receives compensation in respect of any such activities in connection with any such Person (each such agreement, an “Advisory Agreement”), and each such Advisory Agreement was duly approved and performed in all material respects in accordance with the applicable Governing Documents of such fund and applicable Law.  There are no existing material violations by such Jaguar Management Entity or any of its Subsidiaries or any managing member of any Jaguar Fund or, to the knowledge of such Persons, any other

 

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party thereto, of the Governing Documents of any fund or any Advisory Agreement or any side letter with any investor in a fund.  True and complete copies have been made available to the Giants Parties prior to the date hereof of (i) each form of subscription agreement and private placement memorandum or other offering document in effect as of the date hereof for each fund (ii) all material side letters with any investor in any fund.

 

Section 4.16.                 Material Contracts.

 

(a)           Except for contracts listed in Section 4.16(a) of the Jaguar Disclosure Letter, as of the date of this Agreement, no such Jaguar Party or any of its Subsidiaries is a party to or bound by any contract that, as of the date hereof:

 

(i)            obligates such Jaguar Party or any of its Subsidiaries to make non-contingent aggregate annual expenditures (other than principal and/or interest payments or the deposit of other reserves with respect to debt obligations) in excess of $500,000 and is not cancelable within ninety (90) days without material penalty to such Jaguar Party or any of its Subsidiaries that relates to any of the Included Assets or pursuant to which Giants or any of its Subsidiaries (including, after the Closing, the Included Entities and the Jaguar Management Entities) could become an obligor pursuant to the Transactions, except for any lease under which such Jaguar Party or any of its Subsidiaries is lessee, any ground lease affecting any Jaguar Included Property or relates to tenant improvement expenses under a Jaguar Lease;

 

(ii)           contains any non-compete or exclusivity provisions with respect to any line of business or geographic area that restricts the business of such Jaguar Party or any of its Subsidiaries in any material respect, or would otherwise limit the freedom of such persons with respect to, or restrict, the lines of business conducted by such Jaguar Party or any of its Subsidiaries or the geographic area in which such Jaguar Party or any of its Subsidiaries may conduct business in any material respect that relates to any of the Included Assets or pursuant to which Giants or any of its Subsidiaries (including, after the Closing, the Included Entities and the Jaguar Management Entities) could become an obligor pursuant to the Transactions;

 

(iii)          obligates any Included Entity, Jaguar Management Entity or Subsidiary of a Jaguar Party to any material continuing contractual obligation (i) for indemnification under any agreements relating to the sale of real property, or any other business or material assets, previously owned, whether directly or indirectly, by a Jaguar Management Entity, an Included Entity, or Subsidiary of a Jaguar Party that are reasonably likely to involve a Liability of $1,000,000 or more or (ii) to make payments, contingent or otherwise, on account of prior acquisitions or sales of any real property;

 

(iv)          is an agreement which obligates such Jaguar Party or any of its Subsidiaries to indemnify any past or present directors, officers, trustees, employees and agents of such Jaguar Party or any of its Subsidiaries pursuant to which such Jaguar Party or any of its Subsidiaries is the indemnitor, in each case, other than pursuant to any Governing Documents, operating agreements, property management agreements, development agreements, advisory agreements or any similar agreement;

 

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(v)           constitutes an Indebtedness obligation of such Jaguar Party or any of its Subsidiaries with a principal amount outstanding as of the date hereof greater than $500,000 that relates to any of the Included Assets or pursuant to which Giants or any of its Subsidiaries (including, after the Closing, the Included Entities and the Jaguar Management Entities) could become an obligor pursuant to the Transactions;

 

(vi)          requires such Jaguar Party or any of its Subsidiaries to dispose of or acquire assets or properties (other than in connection with the expiration of a Jaguar Lease or a ground lease affecting a Jaguar Included Property) with a fair market value in excess of $1,000,000, or involves any pending or contemplated merger, consolidation or similar business combination transaction, except for any Jaguar Lease or any ground lease affecting any Jaguar Included Property, that relates to any of the Included Assets or pursuant to which Giants or any of its Subsidiaries (including, after the Closing, the Included Entities and the Jaguar Management Entities) could become an obligor pursuant to the Transactions;

 

(vii)         constitutes an interest rate cap, interest rate collar, interest rate swap or other contract or agreement relating to a hedging transaction that relates to any of the Included Assets or pursuant to which Giants or any of its Subsidiaries (including, after the Closing, the Included Entities and the Jaguar Management Entities) could become an obligor pursuant to the Transactions;

 

(viii)        is an Advisory Agreement;

 

(ix)          sets forth the operational terms of a joint venture, partnership, limited liability company or strategic alliance of an Included Entity, a Jaguar Management Entity or Subsidiary of a Jaguar Party with any party other than an Included Entity, Jaguar Management Entity or Subsidiary of a Jaguar Party; or

 

(x)           constitutes a loan to any Person (other than to a wholly owned Subsidiary of a Jaguar Party) by an Included Entity, Jaguar Management Entity or Subsidiary of a Jaguar Party (other than advances made pursuant to the Jaguar Leases or any disbursement agreement, development agreement, or development addendum entered into in connection with a Jaguar Lease with respect to the development, construction, or equipping of a Jaguar Included Property or the funding of improvements to Jaguar Included Properties) in an amount in excess of $500,000;

 

(xi)          is an agreement that obligates payments to any Person contingent on the future operating results or other similar future events having a material economic effect relating to the Included Assets or the Jaguar Management Entities or arising out of prior acquisitions or sales in respect of the Included Assets or the Jaguar Management Entities pursuant to which Giants or any of its Subsidiaries (including, after the Closing, the Included Entities and the Jaguar Management Entities) could become an obligor pursuant to the Transactions;

 

(xii)         is an agreement (other than a Joint Venture Agreement) obligating an Included Entity, a Jaguar Management Entity or a Subsidiary of a Jaguar Party to

 

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provide any funds to, or make any investment (in the form of a loan, capital contribution or otherwise) in any other Person in excess of $500,000;

 

(xiii)        is a service or equipment leasing agreement relating to any Included Assets which obligates such Jaguar Party or any of its Subsidiaries to make non-contingent aggregate annual expenditures in excess of $500,000 and is not terminable on thirty (30) days’ notice or less without penalty or fee and which may be binding on the Giants Parties or a Jaguar Included Property after the Closing;

 

(xiv)        is an agreement with or for the benefit of any Governmental Entity requiring payment by an Included Entity, a Jaguar Management Entity or Subsidiary of a Jaguar Party in excess of $500,000 in any calendar year remaining in its term or requires total remaining payment in excess of $500,000 other than a ground lease that relates to any of the Included Assets or pursuant to which Giants or any Giants Subsidiaries could become an obligor pursuant to the Transactions;

 

(xv)         is a gross maximum price construction contract or an agreement for any construction or development work (including any additions or expansions) which are currently in effect and under which such Jaguar Party or any of its Subsidiaries currently has an obligation in excess of $5,000,000, unless a Jaguar Party or its Subsidiary is the developer, that relates to any of the Included Assets or pursuant to which Giants or any of its Subsidiaries (including, after the Closing, the Included Entities and the Jaguar Management Entities) could become an obligor pursuant to the Transactions;

 

(xvi)        is an agreement between a Jaguar Management Entity or an Included Entity, on the one hand, and the current directors, officers, partners, members or other Affiliates of any Jaguar Party (but not including as Affiliates any Included Entities or Jaguar Management Entities), on the other hand, pursuant to which Giants or any of its Subsidiaries (including, after the Closing, the Included Entities and the Jaguar Management Entities) could become an obligor pursuant to the Transaction; or

 

(xvii)       is a management agreement (i.e., contracts providing for or otherwise governing the management and/or operation of such Jaguar Party, its Subsidiaries or any of their Included Assets (including their Jaguar Included Properties)), including, without limitation, asset management, construction management and property management agreements pursuant to which such Jaguar Party or its Subsidiaries are obligated to pay to another party (that is not a Jaguar Party or a Jaguar Party’s Subsidiary) an amount in excess of $1,000,000 that relates to any of the Included Assets or pursuant to which Giants or any of its Subsidiaries (including, after the Closing, the Included Entities and the Jaguar Management Entities) could become an obligor pursuant to the Transactions.

 

Each contract of the type described above in this Section 4.16(a), whether or not listed on Section 4.16(a) of the Jaguar Disclosure Letter, to which such Jaguar Party or any of its Subsidiaries is a party is referred to herein as a “Jaguar Material Contract”.  True and complete

 

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copies of each Jaguar Material Contract listed on Section 4.16(a) of the Jaguar Disclosure Letter have been provided or made available to the Giants Parties.

 

(b)           Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Jaguar Material Adverse Effect, each Jaguar Material Contract is legal, valid, binding and enforceable on such Jaguar Party and each of its Subsidiaries that is a party thereto and, to the knowledge of such Jaguar Party, each other party thereto, and is in full force and effect, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting creditors’ rights generally and by general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at Law).  Except as, individually or in the aggregate, have not had and would not reasonably be expected to have a Jaguar Material Adverse Effect, such Jaguar Party and each of its Subsidiaries has performed all obligations required to be performed by it prior to the date hereof under each Jaguar Material Contract and, to the knowledge of such Jaguar Party, each other party thereto has performed all obligations required to be performed by it prior to the date hereof under each Jaguar Material Contract.  No such Jaguar Party or any of its Subsidiaries, nor, to the knowledge of such Jaguar Party, any other party thereto, is in material breach or violation of, or default under, any Jaguar Material Contract, and no event has occurred that, with notice or lapse of time or both, would constitute a violation or breach of, or default under, any Jaguar Material Contract, except where in each case such breach, violation or default is not reasonably likely to have, individually or in the aggregate, reasonably be expected to have a Jaguar Material Adverse Effect.  Neither such Jaguar Party nor any of its Subsidiaries has given or received notice of any violation or default under any Jaguar Material Contract, except for violations or defaults that would not, individually or in the aggregate, reasonably be expected to have a Jaguar Material Adverse Effect.

 

Section 4.17.                 Environmental Matters.  Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Jaguar Material Adverse Effect, or as set forth in Section 4.17 of the Jaguar Disclosure Letter:  (a) with respect to the Included Assets, Such Jaguar Party and its Subsidiaries are in compliance with all Environmental Laws; (b) neither such Jaguar Party nor any of its Subsidiaries has received any written notice, demand, letter or claim alleging that such Jaguar Party or any of its Subsidiaries is in violation of, or liable under, any Environmental Law or that any judicial, administrative or compliance order has been issued against such Jaguar Party or any of its Subsidiaries which remains unresolved that relates to any of the Included Assets; and (c) neither such Jaguar Party nor any of its Subsidiaries has entered into or agreed to any consent decree or order or is subject to any judgment, decree or judicial, administrative or compliance order relating to compliance with Environmental Laws, Environmental Permits or the investigation, sampling, monitoring, treatment, remediation, removal or cleanup of Hazardous Substances and no investigation, litigation or other proceeding is pending or, to the knowledge of such Jaguar Party, threatened against such Jaguar Party or any of its Subsidiaries under any Environmental Law, in each case, that relates to the Included Assets.  This Section 4.17 contains the exclusive representations and warranties of such Jaguar Party with respect to environmental matters.

 

Section 4.18.                 Bankruptcy.  Neither such Jaguar Party nor any of its Subsidiaries has (i) made a general assignment for the benefit of creditors, (ii) filed any voluntary petition in bankruptcy or suffered the filing of any involuntary petition by such Jaguar Party’s or any such

 

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Subsidiary’s creditors, (iii) suffered the appointment of a receiver to take possession of all, or substantially all, of such Jaguar Party’s or any such Subsidiary’s assets, which remains pending as of such time, (iv) suffered the attachment or other judicial seizure of all, or substantially all, of such Jaguar Party’s or any such Subsidiary’s assets, which remains pending as of such time, (v) admitted in writing its inability to pay its debts as they come due, or (vi) made an offer of settlement, extension or composition to its creditors generally.

 

Section 4.19.                 Employee Benefit Plans.

 

(a)           Section 4.19(a) of the Jaguar Disclosure Letter sets forth a true, correct and complete list of all material Jaguar Benefit Plans.

 

(b)           Each Jaguar Benefit Plan of such Jaguar Party or any of its Subsidiaries (as applicable) has been established and administered in accordance with its terms and in compliance in all material respects with all applicable Laws, including the Code.

 

(c)           Each Jaguar Benefit Plan of such Jaguar Party or any of its Subsidiaries (as applicable) that is intended to be qualified under Section 401(a) of the Code has received a favorable determination letter from the Internal Revenue Service or is the subject of a favorable opinion letter from the Internal Revenue Service on the form of such Jaguar Benefit Plan and there are no facts or circumstances that would be reasonably likely to adversely affect the qualified status of any such Jaguar Benefit Plan.  Each trust established in connection with any Jaguar Benefit Plan which is intended to be exempt from federal income taxation under Section 501(a) of the Code is so exempt, and no fact or event has occurred that would reasonably be expected to adversely affect the exempt status of any such trust.

 

(d)           Section 4.19(d) of the Jaguar Disclosure Letter sets forth, as of the date of this Agreement, each (i) Multiemployer Plan, or (ii) single employer plan or other pension plan that is subject to Title IV of ERISA or Section 302 of ERISA or Section 412 of the Code, in each case, that any Jaguar Party or any of their respective Subsidiaries or ERISA Affiliates, sponsors, maintains or contributes to, or has within the last six (6) years prior to the date hereof sponsored, maintained or contributed to.  Except as set forth on Section 4.19(d) of the Jaguar Disclosure Letter, neither such Jaguar Party nor any of its Subsidiaries or ERISA Affiliates have incurred or would be likely to incur (whether as a result of the Transactions or otherwise) any liability (including any indirect, contingent or secondary liability) to or on account of a Multiemployer Plan pursuant to Sections 515, 4201, 4204 or 4212 of ERISA; no lien imposed under the Code or ERISA on the assets of any Jaguar Party or any of their respective Subsidiaries or ERISA Affiliates thereof exists or is likely to arise on account of any Multiemployer Plan; and Jaguar Parties and each of their respective Subsidiaries and ERISA Affiliates have made all required contributions and are not delinquent in any contributions to any Multiemployer Plan.

 

(e)           No such Jaguar Party nor any of its Subsidiaries has any obligation to provide (whether under any Jaguar Benefit Plan or otherwise) health, accident, disability, life insurance, death or other welfare benefits to any Jaguar Employee (or any spouse, beneficiary or dependent of the foregoing) beyond the termination of service or retirement of such Service Provider other than as required under Section 4980B of the Code or any similar applicable Law or at the sole expense of such Service Provider.

 

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(f)            No assets of the Jaguar Parties or any of their Subsidiaries constitute “plan assets” for purposes of Title I of ERISA or Section 4975 of the Code or any applicable similar Law.

 

(g)           Neither the execution and delivery of this Agreement, nor the consummation of the Transactions, either alone or in combination with another event (whether contingent or otherwise) will (i) entitle any current or former Service Provider to any payment; (ii) increase the amount of compensation or benefits due to any such Service Provider; or (iii) accelerate the vesting, funding or time of payment of any compensation, equity award or other benefit.

 

(h)           Neither such Jaguar Party nor any of its Subsidiaries is a party to, or has any obligation under, any Contract or Jaguar Benefit Plan to compensate any Person for additional taxes payable pursuant to Sections 409A or 4999 of the Code.

 

Section 4.20.                 Labor and Other Employment Matters.

 

(a)           Section 4.20(a) of the Jaguar Disclosure Letter sets forth, as of the date of this Agreement, each collective bargaining or similar agreement by which a Jaguar Party or any Affiliate thereof is, or has, within the past six (6) years been bound with respect to any current or former employees of the Jaguar Parties or their Affiliates that provide services to the Jaguar Included Properties (“Jaguar Employees”).  As of the date hereof, there is no, and since January 1, 2014, there has not been any, labor strike, work stoppage, picketing, lockout, walkout or other organized work interruption pending, threatened or anticipated against any Jaguar Party or any Affiliate thereof relating to any Service Providers.  Neither such Jaguar Party nor any Affiliate thereof has experienced any such labor strike, work stoppage, picketing, lockout, walkout or other organized work interruption during the past three (3) years by any Service Providers.  Except as specified in Section 4.20(a) of the Jaguar Disclosure Letter, there are no labor unions or other organizations certified or recognized to represent any Jaguar Employees and as of the date hereof, to the Jaguar Parties’ knowledge, no union organization campaign is in progress with respect to, any Jaguar Employees at any of the Included Assets.  As of the date hereof, there are no unfair labor practice charges pending before the National Labor Relations Board or any other Governmental Entity, any grievances, complaints, claims or judicial or administrative proceedings, in each case, which are pending, threatened or, to the Jaguar Parties’ knowledge, anticipated by or on behalf of any current or former Jaguar Employees at any of the Included Assets.

 

(b)           The Jaguar Parties are in compliance in all material respects with all applicable Laws, statutes, rules and regulations respecting employment and employment practices, terms and conditions of employment of current, former and prospective Jaguar Employees, wages and hours, discrimination in employment, wrongful discharge, collective bargaining, the Worker Adjustment Retraining and Notification Act of 1988, as amended or similar state or local Law, statute, rule or regulation (the “WARN Act”), fair labor standards, occupational health and safety, and any other labor and employment-related matters, in each case, with respect to all current and former Jaguar Employees.

 

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(c)           During the three (3) years prior to the date of this Agreement, no Jaguar Party nor any of their respective Subsidiaries have engaged in or effectuated any “plant closing” or employee “mass layoff” (in each case, as defined in the WARN Act), or any similar state or local Law, statute, rule or regulation affecting any current or former Service Providers.

 

Section 4.21.                 Intellectual Property.  Except as set forth on Section 4.21 of the Jaguar Disclosure Letter or, as individually or in the aggregate, has not had and would not reasonably be expected to have a Jaguar Material Adverse Effect, (a) such Jaguar Party and its Subsidiaries own or are licensed or otherwise possess valid rights to use all Intellectual Property necessary to conduct the business of such Jaguar Party and its Subsidiaries as it is currently conducted, (b) the conduct of the business of such Jaguar Party and its Subsidiaries as it is currently conducted does not infringe, misappropriate or otherwise violate and, to the knowledge of such Jaguar Party, is not alleged to infringe misappropriate or otherwise violate, the Intellectual Property rights of any third party (c) there are no pending or, to the knowledge of such Jaguar Party, threatened claims with respect to any of the Intellectual Property rights owned by such Jaguar Party or any of its Subsidiaries, and (d) to the knowledge of such Jaguar Party, no third party is currently infringing or misappropriating Intellectual Property rights of such Jaguar Party or any of its Subsidiaries.  This Section 4.21 contains the exclusive representations and warranties of such Jaguar Party and its Subsidiaries with respect to intellectual property matters.

 

Section 4.22.                 OFAC.  Neither such Jaguar Party nor any of its Subsidiaries constitutes a Person with whom a U.S. Person is prohibited from transacting business of the type contemplated by this Agreement, whether such prohibition arises under United States Laws and lists published by Office of Foreign Assets Control, Department of the Treasury (“OFAC”) (including those executive orders and lists published by OFAC with respect to Persons that have been designated by executive order or by the sanction regulations of OFAC as Persons with whom U.S. Persons may not transact business or must limit their interactions to types approved by OFAC) or otherwise.

 

Section 4.23.                 Patriot Act.  Neither such Jaguar Party or any of its Subsidiaries nor, to the knowledge of such Jaguar Party, any Person providing funds to a Jaguar Party or any of its Subsidiaries (a) is under investigation by any Governmental Entity for, or has been charged with, or convicted of, money laundering, drug trafficking, terrorist related activities, any crimes which in the United States would be predicate crimes to money laundering, or any violation of any Anti-Money Laundering Laws; (b) has been assessed civil or criminal penalties under any Anti-Money Laundering Laws; or (c) has had any of its funds seized or forfeited in any action under any Anti-Money Laundering Laws.  For purposes of this Agreement, “Anti-Money Laundering Laws” means all Laws, regulations and sanctions, state and federal, criminal and civil, that (i) limit the use of and/or seek the forfeiture of proceeds from illegal transactions; (ii) limit commercial transactions with designated countries or individuals believed to be terrorists, narcotics dealers or otherwise engaged in activities contrary to the interests of the United States; (iii) require identification and documentation of the parties with whom a financial institution conducts business; or (iv) are designed to disrupt the flow of funds to terrorist organizations.  Such laws, regulations and sanctions shall be deemed to include the USA PATRIOT Act of 2001, Pub. L. No. 107-56, the Bank Secrecy Act, 31 U.S.C. Section 5311 et seq., the Trading with the Enemy Act, 50 U.S.C. App. Section 1 et seq., the International Emergency Economic Powers Act, 50 U.S.C. Section 1701 et seq., and the sanction regulations promulgated pursuant

 

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thereto by the OFAC, as well as laws relating to prevention and detection of money laundering in 18 U.S.C. Sections 1956 and 1957.

 

Section 4.24.                 Anti-Corruption.  The Jaguar Parties have complied, are in compliance with, and will continue to comply with applicable anti-bribery/anti-corruption laws, including the US Foreign Corrupt Practices Act.  Neither such Jaguar Party or any of its Subsidiaries nor, to the knowledge of such Jaguar Party, any of their principals, owners, officers, directors, or agents, in each case, acting at the direction or on behalf of such Jaguar Party, its Subsidiaries or any of their respective Affiliates, has engaged, promised to engage, will promise to engage, or will cause to be engaged, in any transaction or activity involving a direct or indirect improper inducement to any Person (including but not limited to a government official) to obtain or keep business or to secure some other advantage, in violation of applicable anti-bribery/anti-corruption laws.

 

Section 4.25.                 Insurance.  Except for those matters that have not had and would not reasonably be expected to have a Jaguar Material Adverse Effect, there is no claim for coverage by such Jaguar Party or any of its Subsidiaries that relates to any of the Included Assets pending under any of the material insurance policies (including title insurance policies) and all material fidelity bonds or other insurance service contracts in such Jaguar Party’s or its Subsidiaries’ possession providing coverage for all Jaguar Included Properties (the “Jaguar Insurance Policies”) that has been denied or disputed by the insurer.  Except for those matters that have not had and would not reasonably be expected to have a Jaguar Material Adverse Effect, all premiums due and payable under all Jaguar Insurance Policies that relate to any of the Included Assets have been paid, and such Jaguar Party and its Subsidiaries have otherwise complied in all material respects with the terms and conditions of all Jaguar Insurance Policies.  To the knowledge of such Jaguar Party, such Jaguar Insurance Policies that relate to any of the Included Assets are valid and enforceable in accordance with their terms and are in full force and effect and no written notice of cancellation or termination has been received by such Jaguar Party or any of its Subsidiaries with respect to any such policy which has not been replaced on substantially similar terms prior to the date of such cancellation.

 

Section 4.26.                 Information in the Proxy Statement and SEC Filings.  None of the information supplied or to be supplied in writing by or on behalf of such Jaguar Party or its Subsidiaries for inclusion or incorporation by reference in the Proxy Statement will, at the date it is first mailed to the stockholders of Giants, at any time it is amended or supplemented or at the time of the Giants Stockholder Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading.  None of the information supplied or to be supplied by or on behalf of such Jaguar Party or its Subsidiaries for inclusion in any of the filings made or to be made by the Giants Parties or their Affiliates with the SEC or with any stock exchange of or other regulatory authority will, at the time filed with the SEC, any stock exchange or other regulatory authority, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which they are made, not misleading.

 

Section 4.27.                 Brokers; Expenses.  No broker, investment banker, financial advisor or other Person (other than Merrill Lynch, Pierce, Fenner & Smith Incorporated and Morgan

 

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Stanley Incorporated), is entitled to receive any broker’s, finder’s, financial advisor’s or other similar fee or commission in connection with this Agreement or the Transactions based upon arrangements made by or on behalf of such Jaguar Party or any of its Subsidiaries.  Other than the arrangements described in the engagement letters with Merrill Lynch, Pierce, Fenner & Smith Incorporated and Morgan Stanley Incorporated, true and complete copies of which have been previously made available to the Jaguar Parties, Section 4.27 of the Jaguar Disclosure Letter sets forth the outside legal, accounting and financial advisors retained as of the date hereof by any Jaguar Party (on its own behalf or on behalf of any other Person) in connection with the Transactions with which such Jaguar Party has any contingent payment arrangements requiring payments to be made after December 31, 2015 in connection with the Transactions that are contingent upon the execution of this Agreement or the Transactions or, in the case of advisors customarily compensated on the basis of hourly time charges, are not based on actual time charges and expense reimbursement and describes such arrangements.  Since December 31, 2015, none of the Jaguar Parties or any of their Subsidiaries or Affiliates has made any material payments in excess of the amounts contemplated by this Section 4.27 to any such advisors.

 

Section 4.28.                 Directors.  Each individual listed on Section 3.28(a) of the Giants Disclosure Letter has agreed in writing to serve as a member of the Giants Board effective as of the Closing.  A true and complete copy of each such agreement has been delivered to Giants.

 

Section 4.29.                 Roll-Forward Balance Sheet Matters.

 

(a)           The Retained Partners Equity for the Included Entities for the period from January 1, 2016 through and including March 31, 2016 was not less than $47,001,000.  The Jaguar Parties have provided the Giants Parties with true, complete and correct supporting documentation evidencing the investment of such Retained Partners Equity in the Included Assets.

 

(b)           Section 4.29 of the Jaguar Disclosure Letter sets forth, for each Jaguar Fund, the aggregate amount of capital commitments that the general partner or managing member of the applicable Jaguar Fund has available to call from the direct and indirect limited partners or members of each Jaguar Fund.

 

Section 4.30.                 Non-Controlled Subsidiaries.  Each Subsidiary of the Jaguar Parties listed on Section 4.30 of the Jaguar Disclosure Letter is controlled, directly or indirectly, by a Person other than a Jaguar Party or its Affiliates.  Notwithstanding anything to the contrary contained herein, the representations and warranties of the Jaguar Parties in this Article IV with respect to such Subsidiaries shall be qualified to the knowledge of the Jaguar Parties.

 

Section 4.31.                 No Other Representations or Warranties.  Except for the representations and warranties expressly set forth in this Article IV, such Jaguar Party nor any of its Subsidiaries or any other Person makes any other express or implied representation or warranty with respect to such Jaguar Party, its Subsidiaries, the Jaguar Included Properties, the Included Entities, the Included Interests, the Managing Member Interests, the Included Assets,  or with respect to any other information provided to the Giants Parties in connection with (i) the

 

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Transactions or (ii) the businesses, affairs, operations, assets, Liabilities, condition (financial or otherwise) or prospects or any other matter relating to such Jaguar Party, its Subsidiaries or any of their Jaguar Included Properties, including with respect to any documentation, forecasts, budgets, projections, estimates or other information (including the accuracy or completeness of, or the reasonableness of the assumptions underlying, such documentation, forecasts, budgets, projections, estimates or other information) provided by such Jaguar Party, its Subsidiaries or any other Person to the Giants Parties.

 

ARTICLE V

 

PRE-CLOSING COVENANTS

 

Each of the Parties covenants and agrees to the extent applicable to it as follows (it being understood that the covenants and agreements of any Jaguar Party are as to itself and not as to the other Jaguar Parties and are several and not joint; provided, that with respect to any covenant or agreement of any Jaguar Fund, such covenant or agreement is made jointly and severally by such Jaguar Fund and Jaguar Operating Partners).

 

Section 5.1.                   Access; Confidentiality; Notice of Certain Events.

 

(a)           Between the date of this Agreement and the Closing or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, to the extent permitted by applicable Law and contracts, each of the Parties shall, and shall cause each of its Subsidiaries to, afford to the other Party and its respective Representatives reasonable access during normal business hours and upon reasonable advance notice to all of their respective properties, offices, books, contracts, commitments and records and, during such period, each of the Parties shall, and shall cause each of its Subsidiaries to, furnish reasonably promptly to the other Party all information (financial or otherwise) concerning its business and properties the other Party may reasonably request.  Notwithstanding the foregoing, the Parties shall not be required by this Section 5.1 to provide the other Party or its respective Representatives with access to or to disclose (i) material prepared in connection with or relating to the Transactions or any other strategic alternatives contemplated by the Parties, (ii) information that is subject to confidentiality obligations to a third party (provided, however, that each of the Giants Parties and the Jaguar Parties, as applicable, shall use their commercially reasonable efforts to obtain the required consent of such third party to such access or disclosure), (iii) information the disclosure of which would violate any Law, (iv) information that is subject to any attorney-client, attorney work product or other legal privilege or (v) information that Parties reasonably believe is competitively sensitive with respect to the other Party.  The Parties shall use their commercially reasonable efforts to minimize any disruption to the business of the other Party or any of its Subsidiaries that may result from any requests for access, data or information hereunder.  Any access to the properties of the Parties or any of its Subsidiaries shall be subject to the other Party’s reasonable security measures and insurance requirements and shall not include the right to perform invasive testing without such Party’s prior written consent, which consent shall not be unreasonably withheld, delayed or conditioned.  Prior to the Closing, each of the Parties shall not, and shall cause their respective Representatives and Affiliates not to, contact or otherwise communicate with the employees of the other Party or any of its Subsidiaries (other than those senior executive officers set forth on Section 5.1 of the Giants Disclosure Letter or the Jaguar Disclosure Letter) or

 

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tenants, lenders or other parties with which such Party or any of its Subsidiaries has a business relationship regarding the business of the such Party and its Subsidiaries or this Agreement and the Transactions without the prior consent of the other Party.

 

(b)           Each of the Parties will hold, and will cause its Representatives and Affiliates to hold, any nonpublic information of the other Party and its Subsidiaries, including any information exchanged pursuant to this Section 5.1, in confidence to the extent required by and in accordance with, and will otherwise comply with, the terms of the Confidentiality Agreement.

 

(c)           Each of the Giants Parties and the Jaguar Parties agree to give prompt written notice to the other (i) of any notice or other communication received by such Party (A) from any Governmental Entity in connection with this Agreement or the Transactions, (B) from any Person alleging that the consent of such Person (or another Person) is or may be required in connection with the Transactions, or (C) of any written notice received from any Person in connection with any material violation or default under or notice to terminate, not renew or challenge the validity or enforceability of any Giants Material Contract or Jaguar Material Contract, as applicable, (ii) of any legal proceeding commenced or, any written threat to commence against, such Party or any of its Subsidiaries or Affiliates or, to its knowledge, otherwise relating to, involving or affecting such Party or any of its Subsidiaries or Affiliates, in each case in connection with, arising from or otherwise relating to the Transactions, and (iii) upon becoming aware of the occurrence or impending occurrence of any event, change, development or circumstance relating to it or any Giants Subsidiary or any Subsidiary of such Jaguar Party, respectively, which makes or is reasonably likely to make any of the conditions set forth in Article VII to not be satisfied.  The failure to deliver any such notice, in and of itself, shall not result in the failure of, or otherwise affect, any of the conditions set forth in Article VII.

 

Section 5.2.                   Consents and Approvals.

 

(a)           Upon the terms and subject to the conditions set forth in this Agreement, each of the Parties shall use commercially reasonable efforts (unless, with respect to any action, another standard is set forth herein) to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other Parties in doing, all things necessary, proper or advisable under applicable Law or pursuant to any contract or agreement to consummate and make effective, as promptly as practicable, the Transactions, including using commercially reasonable efforts (i) to cause the conditions to Closing set forth in Article VII to be satisfied, (ii) to obtain all necessary actions or nonactions, waiting period expirations or terminations, waivers, consents, authorizations and approvals from Governmental Entities or other Persons necessary in connection with the consummation of the Transactions, including, with respect to the Giants Parties, the consents listed on Section 3.5(a) of the Giants Disclosure Letter and with respect to the Jaguar Parties, the consents listed on Section 4.3 of the Jaguar Disclosure Letter, and the making of all necessary registrations and filings (including filings with Governmental Entities, if any) to obtain an approval, waiting period expirations or terminations or waiver from, or to avoid an action or proceeding by, any Governmental Entity or other Persons necessary in connection with the consummation of the Transactions, (iii) to defend any lawsuits or other legal proceedings, whether judicial or administrative, challenging this Agreement or the Transactions, including seeking to have any stay or temporary restraining order

 

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entered by any court or other Governmental Entity vacated or reversed, and avoid each and every impediment under any antitrust, merger control, competition or trade regulation Law that may be asserted by any Governmental Entity with respect to the Transactions so as to enable the Closing to occur as soon as reasonably possible, and (iv) to execute and deliver any additional instruments necessary to consummate the Transactions and to fully carry out the purposes of this Agreement. The Jaguar Parties shall use their commercially reasonable efforts, to satisfy the condition set forth in Section 7.2(i), and, to the extent not otherwise satisfied, shall take all actions within their respective control to make capital calls from their respective limited partners or members who have unfunded capital commitments to cause such condition to be satisfied.

 

(b)           In connection with and without limiting the foregoing, each of the Giants Parties and the Jaguar Parties shall give (or shall cause to be given) any notices to any Person, and the Giants Parties and the Jaguar Parties shall use, and cause each of their respective Affiliates to use, commercially reasonable efforts to obtain any consents, terminations, waivers, authorizations and approvals not covered by Section 5.2(a) that are proper or advisable to consummate the Transactions.

 

(c)           Any material notices pursuant to Sections 5.2(a) and (b) shall be subject to the review and consent of the other Party, such consent not to be unreasonably withheld, delayed or conditioned.  Any material notice with respect to any waiver, consent, authorization or approval shall be subject to the review and consent of the other Party, such consent not to be unreasonably withheld, delayed or conditioned.

 

(d)           Each of the Parties will furnish to the other such necessary information and reasonable assistance as the other may request in connection with the preparation of any required governmental filings or submissions and will cooperate in responding to any inquiry from a Governmental Entity, including promptly informing the other Party of such inquiry, consulting in advance before making any presentations or submissions to a Governmental Entity, and supplying each other with copies of all material correspondence, filings, productions or communications between either Party and any Governmental Entity with respect to this Agreement.  To the extent reasonably practicable, the Parties or their Representatives shall have the right to review in advance and each of the Parties will consult the others on, all the information relating to the other and each of their Affiliates that appears in any filing made with, or written materials submitted to, any Governmental Entity in connection with the Transactions, except that confidential competitively sensitive business information may be redacted from such exchanges.  The Parties may, as they deem advisable and necessary, designate any competitively sensitive materials provided to the other under this Section 5.2 as “outside counsel only”.  Such materials and the information contained therein shall be given only to outside counsel of the recipient and will not be disclosed by such outside counsel to employees, officers, or directors of the recipient without the advance written consent of the Party providing such materials.  To the extent reasonably practicable, neither the Giants Parties nor the Jaguar Parties shall, nor shall they permit their respective Representatives to, participate independently in any meeting or engage in any substantive conversation with any Governmental Entity in respect of any filing, investigation or other inquiry relating to the Transactions without giving the other Party prior notice of such meeting or conversation and, to the extent permitted by applicable Law and the Governmental Entity, without giving the other Party the opportunity to attend or participate (whether by telephone or in person) in any such meeting with such Governmental Entity.

 

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Subject to applicable law, the Parties will consult and cooperate with each other in connection with any analyses, appearances, presentations, memoranda, briefs, arguments, and proposals made or submitted to any Governmental Entity regarding the Transactions.

 

(e)           Notwithstanding anything to the contrary in this Agreement, in connection with obtaining any approval or consent from any Person with respect to the Transactions, none of the Giants Parties, or any of their Representatives, shall without the consent of the Jaguar Parties, which consent shall not be unreasonably withheld, delayed or conditioned, (i) pay or commit to pay to such Person whose approval or consent is being solicited any cash or other consideration, make any accommodation or commitment or incur any Liability or other obligation to such Person prior to the Closing, except that the Giants Parties may incur (A) legal, servicers and other similar fees required to be paid under the applicable agreement in connection with obtaining such approval or consent, (B) assumption fees required to be paid under the applicable agreement, which will be payable at Closing, and (C) filing fees due to Governmental Entities in connection with required filings or notifications regarding the Transactions or (ii) agree or otherwise be required to sell, divest, dispose of, license, hold separate, or take or commit to take any action that limits in any respect its freedom of action with respect to, or its ability to retain, any businesses, products, rights, services, licenses or assets.  Subject to the immediately preceding sentence, the Parties shall cooperate with respect to accommodations that may be requested or appropriate to obtain such consents.  Notwithstanding anything to the contrary herein, the Giants Parties shall not agree to any material economic concessions or any material changes to any contract listed on Section 3.5(a) of the Giants Disclosure Letter in connection with obtaining its consent, except as set forth on Section 5.2 of the Giants Disclosure Letter without the written consent of the Jaguar Parties, which consent shall not be unreasonably withheld, delayed or conditioned.

 

(f)            Notwithstanding anything to the contrary in this Agreement except for actions permitted under Section 5.5(b)(xii) and 5.5(b)(xiii), in connection with obtaining any approval or consent from any Person with respect to the Transactions, none of the Jaguar Parties, or any of their Representatives, shall without the consent of the Giants Parties, which consent shall not be unreasonably withheld, delayed or conditioned, (i) make any material accommodation or commitment or incur any material Liability or other obligation to such Person prior to the Closing, (ii) agree or otherwise be required to sell, divest, dispose of, license, hold separate, or take or commit to take any action that limits in any respect its freedom of action with respect to, or its ability to retain, any businesses, products, rights, services, licenses or assets or (iii) agree to any material economic concessions or any material changes to any contract listed on Section 4.3 of the Jaguar Disclosure Letter provided, however, that the Jaguar Parties may pay or commit to pay to any such Persons whose approval or consent is being solicited any Jaguar Consent Expenses and any filing fees due to Governmental Entities in connection with required filings or notifications regarding the Transactions.

 

(g)           The Giants Parties and the Jaguar Parties agree:  (i) to make, or cause their ultimate parent entities as that term is defined in the HSR Act to make, or cause to be made, appropriate filings of the Notification and Report Form under the HSR Act if applicable, with respect to the Transactions as promptly as practicable; and (ii) to take all other actions reasonably necessary to cause the expiration or termination of the applicable waiting periods under the HSR Act as soon as practicable.  The responsibility for the payment of any filings fees

 

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in connection with any filings under the HSR Act shall be apportioned 35% by Giants, and 65% by the Jaguar Parties.

 

(h)           Additional Jaguar Third Party Consent Procedures; Designation of Kickout Interests.

 

(i)            If a Required Jaguar Debt Consent has not been obtained within 120 days of the date hereof, then, except with the consent of the Giants Parties (not to be unreasonably withheld, conditioned or delayed), the Jaguar Parties shall use commercially reasonable efforts either (i) to refinance the applicable Indebtedness (A) for a principal amount not to exceed the sum of the outstanding principal amount under the Indebtedness being refinanced plus all costs specifically necessary to accomplish such refinancing, (B) for a term that is no shorter than the term then remaining on the Indebtedness being refinanced, and (C) on other market terms and on terms which do not restrict the consummation of the Transactions or (ii) to increase the capacity of the Credit Facility, if necessary, in an amount sufficient to draw down and repay the outstanding principal amount of such Indebtedness and to use such additional amounts available under the Credit Facility to repay the Indebtedness under which such Required Jaguar Debt Consent is required (a “Jaguar Debt Refinancing”).  The Jaguar Parties shall provide Giants copies of any term sheets, commitments, agreements or instruments to be executed in connection with any Jaguar Debt Refinancing prior to the execution thereof, and shall promptly provide to Giants written notice of the consummation of any Jaguar Debt Refinancing.  If, prior to the Closing, the Jaguar Parties are not able to obtain such Required Jaguar Debt Consent or consummate a Jaguar Debt Refinancing with respect to the Indebtedness relating, directly or indirectly, to any Included Properties set forth on Section 5.2(h)(i), the Included Interest the contribution of which requires such Required Jaguar Debt Consent will be deemed a “Kickout Interest” for purposes of this Agreement and the contribution of such Kickout Interest shall not occur.;

 

(ii)           If the Jaguar Parties are not able to obtain any Required Jaguar Ground Lease Consent with respect to any Included Interest holding a direct or indirect interest in the Included Properties set forth on Section 5.2(h)(ii)(A) of the Jaguar Disclosure Letter prior to the Closing, the applicable Included Interest the contribution of which requires such Required Jaguar Ground Lease Consent will be deemed a “Kickout Interest” for purposes of this Agreement and the contribution of such Kickout Interest shall not occur.  If a Required Jaguar Ground Lease Consent with respect to any Included Interest holding a direct or indirect interest in the Included Properties set forth on Section 5.2(h)(ii)(B) of the Jaguar Disclosure Letter  is not obtained prior to the Closing, then the Managing Member Interest with respect to any such Included Interest will be deemed an “Excluded Managing Member Interest” for purposes of this Agreement and shall not be contributed to Giants, the Operating Partnership or any Giants Subsidiary.

 

(iii)          If a Required Jaguar JV Consent with respect to any Included Interest holding a direct or indirect interest in the Included Properties set forth on Section 5.2(h)(iii)(A) of the Jaguar Disclosure Letter  is not obtained prior to the Closing, the applicable Included Interest the contribution of which requires such Required Jaguar JV Consent will be deemed a “Kickout Interest” for purposes of this Agreement and the

 

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contribution of such Kickout Interest shall not occur.  If a Required JV Consent with respect to any Included Interest holding a direct or indirect interest in the Included Properties set forth on Section 5.2(h)(iii)(B) of the Jaguar Disclosure Letter  is not obtained prior to the Closing, then the Managing Member Interest with respect to any such Included Interest will be deemed an “Excluded Managing Member Interest” for purposes of this Agreement and shall not be contributed to Giants, the Operating Partnership or any Giants Subsidiary.

 

(iv)          If an Included Interest identified on Section 5.2(h)(iv) of the Jaguar Disclosure Letter is not acquired prior to or concurrently with the Closing and therefore is not able to be contributed at the time of Closing for any reason, then such Included Interest will be deemed a “Kickout Interest” for purposes of this Agreement and the contribution of such Kickout Interest shall not occur.

 

(i)            The Giant Parties will use commercially reasonable efforts to replace recourse guarantees in respect of any Indebtedness that will continue in place after the Closing Date or other similar obligations of any Jaguar Party or Affiliate of any Jaguar Party related to an Included Assets and which such Jaguar Party reasonably believe would be advisable in connection with this Transaction, with respect to liabilities arising thereunder from and after the Closing Date.  To the extent the Parties are unable to replace such guarantee or other similar obligation, then Giants or a suitable Giants Subsidiary will indemnify, defend and hold harmless the applicable Jaguar Party and its agents, assigns and successors from and against all Liabilities and expenses incurred by such Jaguar Party to the beneficiaries of the guarantees or other similar agreement arising out of, relating to, or resulting from the failure of Giants to obtain a release of such guarantees or similar agreements previously made by such Jaguar Party with respect to an Included Asset with respect to liabilities arising thereunder from and after the Closing Date.

 

Section 5.3.                   Publicity.  So long as this Agreement is in effect, none of the Giants Parties or the Jaguar Parties, nor any of their respective Affiliates or Representatives, shall issue or cause the publication of any press release or other public announcement with respect to the Transactions or this Agreement without the prior written consent of the other Party, unless such Party determines, after consultation with outside counsel, that it is required by applicable Law or by any listing agreement with or the listing rules of a national securities exchange or trading market to issue or cause the publication of any press release or other public announcement with respect to the Transactions or this Agreement, in which event such Party shall endeavor, on a basis reasonable under the circumstances, to provide a meaningful opportunity to the other Party to review and comment upon such press release or other public announcement and shall give due consideration to all reasonable additions, deletions or changes suggested thereto; provided, however, that (i) the Giants Parties shall not be required to provide any such review or comment to the Jaguar Parties in connection with the receipt and existence of a Takeover Proposal and matters related thereto or an Adverse Recommendation Change and (ii) this Section 5.3 does not apply to the information that the Parties are required to include in any notification required under the HSR Act or in connection with their responses to any inquiries from a Governmental Entity regarding the Transactions.

 

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Section 5.4.                   Conduct of Business by the Giants Parties.

 

(a)           The Giants Parties agree that between the date of this Agreement and the Closing or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, except (i) as set forth in Section 5.4 of the Giants Disclosure Letter, (ii) as required pursuant to this Agreement, (iii) as may be required by Law or (iv) as consented to in writing by the Jaguar Parties (which consent shall not be unreasonably withheld, delayed or conditioned), Giants shall, and shall cause each of the Giants Subsidiaries (including the Operating Partnership) to (A) conduct its business consistent with past practices (it being understood that this clause (A) shall not restrict Giants from the issuance of any Equity Interests if such issuance is permitted by Section 5.4(b)(v)), (B) operate and manage the Giants Properties and its business in the ordinary course and consistent with past practices (including, with respect to maintenance of insurance and the application of security deposits and the payment of obligations) in all material respects, provided that the foregoing shall not impose any obligation on the Giants Parties to undertake any new capital improvement projects after the date hereof (other than to repair or replace any capital improvements requiring immediate repair or replacement) except as provided in Section 5.4 of the Giants Disclosure Letter, (C) perform and otherwise comply, or cause its agents to perform and otherwise comply, in all material respects with, all of the obligations of the lessee under the ground leases affecting any Giants Property and all obligations of the Giants Parties under the Giants Material Contracts, (D) use their respective commercially reasonable efforts to maintain in all material respects the Giants Properties in their current condition (ordinary wear and tear excepted), preserve their business organizations intact in all material respects, and maintain existing relations and goodwill with lenders, tenants, employees and business associates in all material respects and (E) maintain the status of Giants as a REIT and the status of the Operating Partnership as a partnership for U.S. federal income tax purposes.

 

(b)           Without limiting the generality of the foregoing, and except (w) as set forth in Section 5.4 of the Giants Disclosure Letter, (x) as required pursuant to this Agreement, (y) as required by Law or (z) as consented to in writing by the Jaguar Parties (which consent shall not be unreasonably withheld, delayed or conditioned), between the date of this Agreement and the Closing or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, no Giants Party shall, and the Giants Parties shall not permit any Giants Subsidiary to, directly or indirectly:

 

(i)            amend its Governing Documents, except as contemplated by the Giants Charter Amendment;

 

(ii)           adjust, split, combine, subdivide or reclassify any shares of capital stock of Giants or any Giants Subsidiary;

 

(iii)          declare, set aside or pay any dividend (in cash, stock, property or otherwise) on or make any other distributions with respect to Equity Interests of Giants or the Operating Partnership other than the declaration and payment by Giants or the Operating Partnership, as applicable, of (x) monthly cash dividends with respect to Giants Common Stock in accordance with past practice (including timing) for the period up to the Closing Date at a rate not to exceed an annual rate of $0.038333333 per share of Giants Common Stock, (y) monthly cash distributions with respect to OP Units in

 

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accordance with past practice (including timing) for the period up to the Closing Date at a rate not to exceed an annual rate of $0.038333333 per OP Unit, (z) cash distributions or other payments by the Operating Partnership to Giants as required pursuant to the terms of the Partnership Agreement and/or to enable Giants to make any distributions referenced in clause (x) and cash or stock dividends and distributions by Giants, including under Sections 858 or 860 of the Code, if the making of such dividends or distributions prior to the Closing is necessary for Giants to maintain its status as a REIT under the Code or applicable state Law and avoid the imposition of any entity level income or excise Tax under the Code or applicable state Law;

 

(iv)          except as otherwise provided under the Giants Charter, redeem, purchase or otherwise acquire, or offer to redeem, purchase or otherwise acquire, directly or indirectly, any capital stock or other Equity Interests of Giants or any Giants Subsidiary, except (i) from holders of Giants Restricted Stock or recipients of payments under any Giants Stock Plans in full or partial payment of any purchase price and any applicable Taxes payable by such holder upon the lapse of restrictions on the Giants Restricted Stock, (ii) with respect to the redemption or exchange of any partnership units of the Operating Partnership for Giants Common Stock in accordance with the terms of the Partnership Agreement, or (iii) pursuant to the OPP Termination Agreement;

 

(v)           grant, issue, deliver or sell any additional Giants Shares or other common Equity Interests of Giants or any Giants Subsidiaries; provided, however, that (i) Giants may grant annual equity awards to directors of Giants as required by any applicable Giants Stock Plan or in the ordinary course consistent with past practice, (ii) Giants and Giants Subsidiaries, as applicable, may issue Giants Shares upon the vesting or exercise of any equity awards (granted pursuant to a Giants Stock Plan) outstanding as of the date hereof in accordance with the terms and conditions thereof as in effect on the date hereof, (iii) the Giants Parties may issue Giants Shares in connection with the settlement, redemption or exchange of any OP Units in accordance with the terms of the Partnership Agreement, and (iv) the Operating Partnership may issue additional OP Units to Giants in connection with the issuance of any Giants Shares permitted by clauses (ii) and (iii) hereof and the Issued Giants Shares;

 

(vi)          enter into a line of business other than the line of business currently engaged in by Giants and the Giants Subsidiaries;

 

(vii)         knowingly take any action, or knowingly fail to take any action, which action or failure would reasonably be expected to cause Giants to fail to qualify as a REIT or the Operating Partnership to fail to qualify as a partnership for U.S. federal income tax purposes;

 

(viii)        subject to Section 5.7, enter into a merger agreement, acquisition agreement or disposition agreement with respect to Giants, any Giants Subsidiary or any Giants Property or authorize a liquidation, dissolution, consolidation, bankruptcy or other reorganization of Giants or any Giants Subsidiary; provided that nothing herein shall restrict the Giants Parties from taking any such actions in connection with the Giants Marketed Properties;

 

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(ix)          make any change to its methods of accounting in effect at December 31, 2015, except as required by GAAP (or any interpretation or change thereof in accordance with the Financial Accounting Standards Board Statements of Financial Accounting Standards and Interpretations), any Governmental Entity or applicable Law;

 

(x)           change any material method of Tax accounting, make or change any material Tax election, file any amended material Tax Return, settle or compromise any material Tax liability, agree to an extension or waiver of the statute of limitations with respect to the assessment or determination of a material amount of Taxes other than in the ordinary course of business, enter into any closing agreement with respect to a material amount of Tax or surrender any right to claim a material Tax refund;

 

(xi)          enter into any acquisition agreement or acquire any real property;

 

(xii)         sell, transfer or assign any Giants Property or any interest therein or encumber (other than in connection with Indebtedness permitted to be incurred hereunder) any Giants Property with any mortgages, deeds of trust or other Liens which secure Indebtedness for borrowed money; provided that nothing herein shall restrict the Giants Parties from taking any such actions in connection with the Giants Marketed Properties;

 

(xiii)        sell, transfer, assign or remove any personal property from any Giants Property, except in the ordinary course consistent with past practices, unless replaced by unencumbered personal property of equal or greater utility and value; provided that nothing herein shall restrict the Giants Parties from taking any such actions in connection with the Giants Marketed Properties;

 

(xiv)        incur, create, assume, refinance, replace or prepay any Indebtedness for borrowed money or issue or amend the terms of any Indebtedness for borrowed money or assume, guarantee or endorse, or otherwise become responsible (whether directly, contingently or otherwise) for the Indebtedness of any other Person other than in the ordinary course of business, except (A) the refinancing of existing Indebtedness (other than the Giants Parties Credit Agreement) at maturity, in a principal amount not to exceed the principal amount of such Indebtedness being refinanced, and on market terms, which debt shall be prepayable without penalty, (B) the extension of the maturity of the Giants Parties Credit Agreement in accordance with its terms, or (C) as set forth on Section 5.4(b)(xiv) of the Giants Disclosure Letter;

 

(xv)         except to the extent provided in Section 5.14, enter into, or amend, extend, modify, terminate or consent to any such amendment, extension, modification or termination of, any agreement with any Related Party;

 

(xvi)        amend, extend, modify, terminate or consent to any such amendment, extension, modification or termination of any ground lease affecting any Giants Property in a manner that would materially and adversely affect such Giants Property;

 

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(xvii)       enter into, or amend, extend, modify, terminate or consent to, any such amendment, extension, modification or termination of, any Joint Venture Agreement in a manner that would materially and adversely affect such Giants Property;

 

(xviii)      amend or modify or consent to the material amendment or modification of the zoning or entitlements use of any Giants Property;

 

(xix)        waive, release, assign, commence, settle or compromise any pending or threatened legal proceeding (A) of or against Giants or any Giants Subsidiary or (B) involving any present, former or purported holder or group of holders of shares or Giants Common Stock or OP Units, that in the case of (A) or (B), (1) requires payment (not covered by insurance) by Giants or any Giants Subsidiary of an amount in excess of $1,000,000 in the aggregate or that would require the issuance of any Equity Interests or (2) entails the incurrence of any obligation or liability of Giants or any Giants Subsidiary in excess of such amount, including costs or revenue reductions or obligations that would impose any material restrictions on the business or operations of Giants or any Giants Subsidiary, or (3) imposes any non-monetary relief or an admission of liability or wrong doing or that would result in any supplement, modification to or amendment of the terms of (a) any agreement or document relating to the Transactions to which the Jaguar Parties nor any of their affiliates is a party or (b) any Giants Material Contract;

 

(xx)         except as required by applicable Law, (A) hire or terminate (without cause) any employee, officer or director of Giants or any Giants Subsidiary or appoint any Person to a position of officer or director of Giants or any Giants Subsidiary (other than to replace any officer that departs after the date of this Agreement), (B) increase in any manner the amount, rate or terms of compensation or benefits of any officer or director of Giants or any Giants Subsidiary other than in the ordinary course of business and consistent with past practice, or (C) enter into, or adopt any employment, bonus, severance or retirement contract or plan or other compensation or benefit plan; or

 

(xxi)        authorize, or enter into, any Contract, commitment or arrangement to do any of the foregoing.

 

Notwithstanding anything to the contrary set forth in this Agreement, nothing in this Agreement shall prohibit Giants from taking any action, at any time or from time to time, that in the reasonable judgment of Giants is reasonably necessary for Giants to maintain its qualification as a REIT under the Code for any period or portion thereof ending on or prior to the Closing or to avoid incurring entity level income or excise Taxes under the Code, including making dividend or other distribution payments to stockholders of Giants in accordance with this Agreement or otherwise.  If Giants determines that it is necessary to take any such action, it shall notify the Jaguar Parties in writing as soon as reasonably practicable and the Jaguar Parties shall be given a reasonable opportunity to review and provide comments to such action, and Giants shall give consideration, not to be unreasonably withheld, to such comments of the Jaguar Parties prior to the taking of such action.

 

Nothing contained in this Agreement shall give the Jaguar Parties, directly or indirectly, the right to control or direct the Giant Parties’ operations prior to the Closing.  Prior to the

 

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Closing, the Giant Parties shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over their operations.  Notwithstanding anything to the contrary set forth in this Agreement, no consent of the Jaguar Parties shall be required with respect to any matter set forth in Section 5.4 or elsewhere in this Agreement to the extent that the requirement of such consent could violate any applicable Law.

 

Section 5.5.                   Conduct of Business by the Jaguar Parties Pending the Closing.

 

(a)           Each Jaguar Party agrees that between the date of this Agreement and the Closing or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, except (i) as set forth in Section 5.5 of the Jaguar Disclosure Letter, (ii) as required pursuant to this Agreement, (iii) as may be required by Law or (iv) as consented to in writing by the Giants Parties (which consent shall not be unreasonably withheld, delayed or conditioned), such Jaguar Party shall (A) conduct its business in all material respects in the ordinary course of business consistent with past practice (it being understood that this clause (A) shall not restrict any Jaguar Party from the issuance of any Equity Interests if such issuance is permitted by Section 5.5(c)(x)); (B) operate and manage the Jaguar Included Properties and its business in the ordinary course and consistent with past practices (including, with respect to maintenance of insurance and the application of security deposits and the payment of obligations) in all material respects, provided that the foregoing shall not impose any obligation on the Jaguar Parties to undertake any new capital improvement projects after the date hereof (other than to repair or replace any capital improvements requiring immediate repair or replacement) except as provided Section 5.5 of the Jaguar Disclosure Letter; (C) perform and otherwise comply, or cause its agents to perform and otherwise comply, in all material respects with, all of the obligations of the lessee under the ground leases affecting any Jaguar Included Property and all obligations of the Jaguar Parties under the Jaguar Material Contracts; (D) continue to implement the development plan for the Jaguar Included Properties that constitute properties under development in accordance with existing plans, specifications and budgets and past practice; and (E) maintain the status of the Jaguar REITs as REITs, and the status of the other Jaguar Funds and the Jaguar Management Entities as a partnerships or corporations, for U.S. federal income tax purposes.

 

(b)           Without limiting the generality of the foregoing, and except (w) as set forth in Section 5.5 of the Jaguar Disclosure Letter, (x) as required pursuant to this Agreement, (y) as required by Law or (z) as consented to in writing by the Giants Parties (which consent shall not be unreasonably withheld, delayed or conditioned), between the date of this Agreement and the Closing or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, the Jaguar Parties shall not:

 

(i)            (A) with respect to each Included Entity, declare, set aside or pay any Distribution on or with respect to Equity Interests of such Included Entity; provided, that each Included Entity shall be permitted to declare, set aside or pay Distributions (w) out of net sales proceeds (after repayment of any indebtedness and net of any expenses related thereto) from the sale of the properties set forth on Section 5.1(b)(i) of the Jaguar Disclosure Letter that were sold prior to the date hereof, (x) permitted to be made in connection with the Restructuring Transactions, (y) of cash by the Jaguar REITs, if the making of such dividends or distributions prior to the Closing is necessary for such Jaguar REIT to maintain its status as a REIT under the Code including under Sections

 

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858 or  860 of the Code or applicable state Law and avoid the imposition of any entity level income or excise Tax under the Code or applicable state Law, and (z) if the Closing has not occurred by September 30, 2016, of Net Cash Flow relating to the period from and after October 1, 2016, and (B) with respect to the Jaguar Management Entities, declare, set aside or pay any Distribution on or with respect to Equity Interests of such Jaguar Management Entity, other than distributions of Net Cash Flow;

 

(ii)           redeem, purchase or otherwise acquire, or offer to redeem, purchase or otherwise acquire, directly or indirectly, any capital stock or other Equity Interests of any Jaguar Party or its Subsidiary;

 

(iii)          enter into a line of business other than the line of business currently engaged in by any Jaguar Party or its Subsidiary;

 

(iv)          change any material method of Tax accounting, make or change any material Tax election, file any amended material Tax Return, settle or compromise any material Tax liability, agree to an extension or waiver of the statute of limitations with respect to the assessment or determination of a material amount of Taxes other than in the ordinary course of business, enter into any closing agreement with respect to a material amount of Tax or surrender any right to claim a material Tax refund with respect to the Jaguar Parties and the Included Entities;

 

(v)           enter into any acquisition agreement or acquire any real property that is proposed to be included in the Transactions as a Jaguar Included Property, except for the acquisition of the Designated Pipeline Properties;

 

(vi)          sell, transfer or assign any Jaguar Included Property or any interest therein or encumber (other than in connection with Indebtedness permitted to be incurred hereunder) any Jaguar Included Property with any mortgages, deeds of trust or other Liens which secure indebtedness for borrowed money;

 

(vii)         sell, transfer, assign or remove any personal property from any Jaguar Included Property, except as may be done in the ordinary course consistent with past practices, unless replaced by unencumbered personal property of equal or greater utility and value;

 

(viii)        take any action to cause the termination or material amendment or waiver of any provision of any Advisory Agreement;

 

(ix)          incur, create, assume, refinance, replace or prepay any Indebtedness for borrowed money or issue or amend the terms of any Indebtedness for borrowed money or assume, guarantee or endorse, or otherwise become responsible (whether directly, contingently or otherwise) for the Indebtedness of any other Person other than in the ordinary course of business, except (A) the refinancing of existing Indebtedness at maturity, in a principal amount not to exceed the principal amount of such Indebtedness being refinanced, for a term that is no shorter than the term then remaining on the Indebtedness being refinanced, and on other market terms and on terms which does not restrict the Transactions, (B) as set forth on Section 5.5(b)(ix) of the

 

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Jaguar Disclosure Letter, (C) as contemplated by Section 5.2(h), (D) the drawdown of unused amounts under existing construction loans and delayed draw mortgage loans that are available for draw in accordance with the terms of such facilities, (E) the incurrence of Indebtedness by Jaguar Operating Partners to pay for Expenses (other than Excluded Expenses), including from Jaguar Funds, and(F) provided that the condition set forth in Section 7.2(i) has been satisfied, the incurrence of additional Indebtedness (whether or not from existing credit facilities) to fund capital and investment needs solely to the extent the Jaguar Parties reasonably believe in good faith, that there will be sufficient capacity under the Credit Facility (after taking into effect the impact of all financial covenants) to repay such Indebtedness at the Closing in full, after payment of all Mandatory Uses through borrowings under the Credit Facility;

 

(x)           grant, issue, deliver or sell any additional Equity Interests; provided, however, that the Jaguar Parties may issue Equity Interests as required in connection with the Restructuring Transactions;

 

(xi)          except as required by applicable Law or written Contract in effect as of the date of this Agreement that has been disclosed or made available to the Giants Parties and except for arrangements on market terms  in preparation of assuming the responsibilities of a public company take or permit to be taken any action or commitment to (i) increase the compensation payable or that could become payable by the Jaguar Parties or any of its Subsidiaries to Service Providers, other than increases in compensation to employees who are not directors or executive officers made in the ordinary course of business consistent with past practice, or grant, award, pay or accelerate any bonus to any Service Providers, (ii) enter into or amend or terminate any employment, severance, retention or change in control agreement with any of its past or present directors or executive officers, (iii) establish, adopt, enter into, amend, terminate, exercise any discretion under, or take any action to accelerate rights or payments under any Jaguar Benefit Plans or any plan, agreement, program, policy, trust, fund or other arrangement that would be a Jaguar Benefit Plan if it were in existence as of the date of this Agreement, or make any contribution to any Jaguar Benefit Plan, other than contributions required by Law or the terms of such Jaguar Benefit Plan which are made in the ordinary course of business consistent with past practice;

 

(xii)         amend, extend, modify, terminate or consent to any such amendment, extension, modification or termination of any ground lease affecting a Jaguar Included Property in a manner that would materially adversely affect such Jaguar Included Asset;

 

(xiii)        enter into, or amend, extend, modify, terminate or consent to any such amendment, extension, modification or termination of, any Joint Venture Agreement related to a Jaguar Included Property in a manner that would materially adversely affect such Jaguar Included Property;

 

(xiv)        enter into, or amend, extend, modify, terminate or consent to any such amendment, extension, modification or termination of, any agreement with any Related Party;

 

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(xv)                          amend or modify, or consent to the amendment or modification of, the zoning or entitlements use of any Jaguar Included Property in a manner that would materially and adversely affect such Jaguar Included Property;

 

(xvi)                       knowingly take any action, or knowingly fail to take any action, which action or failure would reasonably be expected to cause any of the Jaguar REITs to fail to qualify as a REIT or that would affect the ability of any of the Jaguar Surviving REITs or Giants to qualify as a REIT after the Closing;

 

(xvii)                    waive, release, assign, commence, settle or compromise any pending or threatened legal proceeding of or against the Jaguar Management Entities or any Included Entity that (A) requires payment (not covered by insurance) by the Jaguar Management Entities or any Included Entity of an amount in excess of $1,000,000 in the aggregate or that would require the issuance of any Equity Interests, (B) entails the incurrence of any obligation or liability of any Jaguar Management Entities or Included Entity in excess of such amount, including costs or revenue reductions or obligations that would impose any material restrictions on the business or operations of the Jaguar Management Entities or the Included Entities, or (C) imposes any non-monetary relief or an admission of liability or wrong doing or that would result in any supplement, modification to or amendment of the terms of (a) any agreement or document relating to the Transactions to which the Jaguar Parties or any of their Affiliates is a party or (b) any Jaguar Material Contract;

 

(xviii)                 pay prior to Closing more than $20,000,000 in the aggregate for pursuit and acquisition costs related to the Designated Pipeline Properties; or

 

(xix)                       authorize, or enter into, any Contract, commitment or arrangement to do any of the foregoing.

 

Nothing in this Section 5.5 shall restrict the Jaguar Parties’ rights with respect to any Excluded Assets or give the Giants Parties any approval, consent or other rights with respect thereto.

 

(c)                                  Nothing contained in this Agreement shall give the Giant Parties, directly or indirectly, the right to control or direct the Jaguar Parties’ operations prior to the Closing.  Prior to the Closing, the Jaguar Parties shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over their operations.  Notwithstanding anything to the contrary set forth in this Agreement, no consent of the Giant Parties shall be required with respect to any matter set forth in Section 5.5 or elsewhere in this Agreement to the extent that the requirement of such consent could violate any applicable Law.

 

Section 5.6.                                                         Preparation of Proxy Statement; Giants Stockholder Meeting.

 

(a)                                 As promptly as practicable following the date of this Agreement, Giants shall prepare and cause to be filed with the SEC the Proxy Statement in preliminary form.  The Jaguar Parties shall furnish all information concerning themselves, their Affiliates and their management and provide such other assistance as may be reasonably requested in connection with the preparation, filing and distribution of the Proxy Statement.  The Proxy Statement shall

 

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include all information reasonably requested by the Parties to be included therein.  Giants shall promptly notify the Jaguar Parties upon the receipt of any comments from the SEC or any request from the SEC for amendments or supplements to the Proxy Statement, and shall, as promptly as practicable after receipt thereof, provide the Jaguar Parties with copies of all correspondence between Giants and its Representatives, on one hand, and the SEC, on the other hand, and all written comments with respect to the Proxy Statement received from the SEC and promptly advise the Jaguar Parties of any oral comments with respect to the Proxy Statement received from the SEC.  Giants shall use its commercially reasonable efforts to respond as promptly as practicable to any comments from the SEC with respect to the Proxy Statement and have such comments cleared by the SEC as promptly as practicable.  Notwithstanding the foregoing, prior to filing the Proxy Statement (including with respect to the preliminary proxy statement), mailing the Proxy Statement (or any amendment or supplement thereto) or responding to any comments of the SEC with respect thereto, Giants shall cooperate and provide the Jaguar Parties a reasonable opportunity to review and comment on such document or response (including the proposed final version of such document or response) and shall give due consideration to all changes provided by the Jaguar Parties.

 

(b)                                 Giants shall also use commercially reasonable efforts to take any other action required to be taken under the Securities Act, the Exchange Act, and any applicable foreign or state securities or “blue sky” Laws and regulations thereunder in connection with the Equity Issuance and the Jaguar Parties shall furnish all information as Giants may reasonably request in connection with any such actions.

 

(c)                                  If, at any time prior to the receipt of the Giants Stockholder Approval, any information relating to Giants or the Jaguar Parties, or any of their respective Affiliates or, in the case of the Jaguar Parties, management, should be discovered by Giants or the Jaguar Parties which, in the reasonable judgment of Giants or the Jaguar Parties, should be set forth in an amendment of, or a supplement to, the Proxy Statement, so that such document would not include any misstatement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, the party which discovers such information shall promptly notify the other parties hereto, and Giants and the Jaguar Parties shall cooperate in the prompt filing with the SEC of any necessary amendment of, or supplement to, the Proxy Statement and, to the extent required by Law, in disseminating the information contained in such amendment or supplement to stockholders of Giants.  Nothing in this Section 5.6(c) shall limit the obligations of any party under Section 5.6(a).  For purposes of Section 5.7, Section 3.22 and this Section 5.6, any information concerning or related to Giants, its Affiliates or the Giants Stockholder Meeting will be deemed to have been provided by Giants, and any information concerning or related to the Jaguar Parties or their Affiliates (including with respect to their properties, management or businesses) will be deemed to have been provided by the Jaguar Parties.

 

(d)                                 As promptly as practicable following the date of this Agreement, Giants shall, in accordance with applicable Law and the Giants Charter and Giants Bylaws, establish a record date for, duly call, give notice of, convene and hold the Giants Stockholder Meeting.  Giants shall cause the definitive Proxy Statement to be mailed to the stockholders of Giants entitled to vote at the Giants Stockholder Meeting as soon as practicable after it has cleared or resolved any comments, if any, received from the SEC.  Giants shall, through the Giants Board,

 

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recommend to its stockholders that they give the Giants Stockholder Approval, include such recommendation in the Proxy Statement and solicit and use its commercially reasonable efforts to obtain the Giants Stockholder Approval, except to the extent that the Giants Board shall have made an Adverse Recommendation Change as permitted by Section 5.7.  Giants shall keep the Jaguar Parties updated on a periodic basis with respect to proxy solicitation results as reasonably requested by the Jaguar Parties.  Notwithstanding the foregoing provisions of this Section 5.6(d), if, on a date for which the Giants Stockholder Meeting is scheduled, Giants has not received proxies representing a sufficient number of shares of Giants Common Stock to obtain the Giants Stockholder Approval, whether or not a quorum is present, the Jaguar Parties may require Giants, and Giants shall have the right, to make one or more successive postponements or adjournments of the Giants Stockholder Meeting, provided, however, that the Giants Stockholder Meeting may not be postponed or adjourned to a date that is more than 60 days after the date for which the Giants Stockholder Meeting was originally scheduled (excluding any adjournments or postponements required by Law) without the approval of both Parties.

 

Section 5.7.                                                         Giants Acquisition Proposals.

 

(a)                                 From the date hereof through the Closing Date or the earlier termination of the Agreement pursuant to Article VIII, except as permitted by Section 5.7(b), or as permitted by Section 5.4(b)(xii), Giants shall not, and Giants shall cause the Giants Subsidiaries and its and their respective officers and directors not to, and Giants shall use its commercially reasonable efforts to cause its Representatives not to, directly or indirectly (i) solicit, initiate, knowingly facilitate or knowingly encourage any inquiries or discussion regarding, or the making of any proposal or offer that constitutes or could reasonably be expected to lead to, a Takeover Proposal, (ii) continue, enter into or participate in any discussions with any Person regarding, or furnish to any third party any non-public information in connection with, or knowingly facilitate any third party in making a Takeover Proposal (other than to state that Giants is not permitted to have discussions), (iii)  approve, recommend, publicly declare advisable or execute or enter into any letter of intent, memorandum of understanding, agreement in principle or Contract with respect to a Takeover Proposal (other than an Acceptable Confidentiality Agreement), or requiring or having the effect of requiring Giants to abandon, terminate or breach its obligations hereunder or fail to consummate the Transactions or (iv) agree to or propose publicly to do any of the foregoing.  Upon execution of this Agreement, Giants shall, and shall cause the Giants Subsidiaries and its and their respective officers and directors to, and Giants shall use commercially reasonable efforts to cause its Representatives to (i) immediately cease and cause to be terminated any existing discussions, negotiations or communications with any third party conducted heretofore with respect to a Takeover Proposal, and (ii) take such action as is necessary to enforce any confidentiality provisions or provisions of similar effect to which Giants or any Giants Subsidiary is a party or of which Giants or any Giants Subsidiary is a beneficiary; provided, that notwithstanding anything in this Agreement to the contrary, it is understood and agreed that Giants, the Operating Partnership and each other Giants Subsidiary (as applicable) by execution of this Agreement shall be deemed to have waived immediately prior to the date of this Agreement any provision in any agreement that prohibits the counterparty thereto from confidentially requesting Giants, the Operating Partnership or any other Giants Subsidiary (as applicable) to amend or waive the standstill provision in such agreement (i.e., a “don’t ask, don’t waive” provision) to the extent necessary (and only to such extent) to enable such counterparty to convey a Takeover Proposal to the Giants Board;

 

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provided, further, however, notwithstanding anything to the contrary set forth in this Agreement, the Giants Board shall be permitted to modify, waive, amend or release any existing standstill obligation owed by any Person that prohibits a confidential Takeover Proposal being made directly, or indirectly through Representatives of Giants, to Giants, the Operating Partnership or any other Giants Subsidiary (as applicable) to the extent the Giants Board determines in good faith, after consultation with outside legal counsel, that failure to take such action would be inconsistent with the directors’ duties under applicable Law, so long as (A) such modification, waiver, amendment or release is limited only to permitting such a confidential Takeover Proposal and (B) Giants promptly (and in any event, within twenty-four (24) hours) notifies the Jaguar Parties of the granting of such modification, waiver, amendment or release.  Giants shall use commercially reasonable efforts to cause all third parties who have been furnished confidential information regarding Giants or any Giants Subsidiary in connection with the solicitation of or discussions regarding a Takeover Proposal within the twelve (12) months prior to the date of this Agreement to promptly return or destroy such information (to the extent that they are entitled to have such information returned or destroyed).

 

(b)                                 At any time prior to obtaining the Giants Stockholder Approval, following the receipt by Giants of an unsolicited bona fide Takeover Proposal (that was not the result of a breach of this Section 5.7) after the date of this Agreement, (i) the Giants Board shall be permitted to participate in discussions regarding such Takeover Proposal solely to clarify the terms of such Takeover Proposal (provided that, for the avoidance of doubt, Giants shall be required to comply with the provisions of Section 5.7(c) with respect thereto), and (ii) if the Giants Board determines in good faith after consultation with outside legal counsel that such Takeover Proposal constitutes or would reasonably be expected to lead to a Superior Proposal, then Giants may, in response to such Takeover Proposal, (x) furnish access and non-public information with respect to Giants and any of the Giants Subsidiaries to the Person who has made such Takeover Proposal pursuant to an Acceptable Confidentiality Agreement, so long as any written material non-public information provided under this clause (x) has previously been provided to the Jaguar Parties or is provided to the Jaguar Parties substantially concurrently with the time it is provided to such Person, and (y) participate in discussions and negotiations regarding such Takeover Proposal.

 

(c)                                  From and after the date of this Agreement, Giants shall promptly advise the Jaguar Parties of (i) the receipt of any Takeover Proposal or any inquiry from any Person seeking to have discussion or negotiations with Giants or any of its Representatives relating to a possible Takeover Proposal, specifying the identity of the third party making the Takeover Proposal or such inquiry and the material terms and conditions thereof (including a copy thereof if in writing, and any related documentation or correspondence), and (ii) any material modifications to the financial or other material terms and conditions of such Takeover Proposal (and any related documentation or correspondence related thereto), in each case, within twenty-four (24) hours after Giants’ receipt thereof.  Giants shall also promptly, and in any event within twenty-four (24) hours, notify the Jaguar Parties orally and in writing, if Giants (i) enters into discussions or negotiations concerning any Takeover Proposal, or (ii) provides non-public information or data to any third party in accordance with Section 5.7(b), and keep the Jaguar Parties reasonably informed of the status and material terms of any such Takeover Proposal on a reasonably current basis, including by providing a copy of all material documentation or material correspondence relating thereto.

 

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(d)                                 Except as set forth in Section 5.7(e) and Section 5.7(f), the Giants Board shall not (i) withhold, withdraw, qualify, modify or amend the Giants Board Recommendation or publicly propose to do any of the foregoing  in any manner adverse to the Jaguar Parties, (ii) approve, endorse, recommend or otherwise declare advisable a Takeover Proposal (or publicly propose to do any of the foregoing), (iii) approve, recommend or allow Giants to enter into any letter of intent, memorandum of understanding, agreement in principle or Contract relating to a Takeover Proposal (or publicly propose to do any of the foregoing) (other than an Acceptable Confidentiality Agreement), (iv) fail to include the Giants Board Recommendation in the Proxy Statement, or (v) fail to publicly recommend against any Takeover Proposal, or fail to publicly reaffirm the Giants Board Recommendation, within ten (10) Business Days after the written request of the Jaguar Parties following a Takeover Proposal that has been publicly announced (or such fewer number of days as remains prior to the Giants Stockholder Meeting) (provided that the Jaguar Parties shall not be permitted to make any such request on more than one (1) occasion in respect of (A) each Takeover Proposal and (B) each material amendment or material modification of each such Takeover Proposal) (any of the foregoing, an “Adverse Recommendation Change”).

 

(e)                                  At any time before the date the Giants Stockholder Approval is obtained, the Giants Board may (i) make an Adverse Recommendation Change if (x) the Giants Board has received an unsolicited bona fide Takeover Proposal (that did not result from a breach of this Section 5.7) that the Giants Board has concluded (in good faith), following consultation with its outside legal counsel, and after giving effect to all of the adjustments which may be offered by the Jaguar Parties pursuant to Section 5.7(f), constitutes a Superior Proposal, and (y) determines, following consultation with its outside legal counsel, that failure to take such action would reasonably be expected to be inconsistent with the directors’ duties under applicable Law, and in such case Giants may terminate this Agreement pursuant to Section 8.1(c)(ii) and enter into a Contract with respect to such Superior Proposal; or (ii) make an Adverse Recommendation Change as a result of an Intervening Event, if the Giants Board determines in good faith, following consultation with its outside legal counsel, and after giving effect to all of the adjustments which may be offered by the Jaguar Parties pursuant to Section 5.7(f), that failure to take such action would reasonably be expected to be inconsistent with the directors’ duties under applicable Law.

 

(f)                                   The Giants Board shall not be entitled to effect an Adverse Recommendation Change pursuant to Section 5.7(e) or terminate this Agreement pursuant to Section 8.1(c)(ii) unless (i) Giants has provided a written notice (a “Notice of Superior Proposal/Intervening Event”) to the Jaguar Parties that Giants intends to take such action, specifying in reasonable detail the reasons therefor and, (A) in the case of a Superior Proposal, describing the material terms and conditions of, and attaching the most recent draft of, the Superior Proposal that is the basis of such action (it being understood that such material terms shall include the identity of the third party making such Superior Proposal), and (B) in the case of an Intervening Event, the material facts and circumstances (based on information reasonably available) related to such Intervening Event, (ii) during the five (5) Business Day period following the Jaguar Parties’ receipt of the Notice of Superior Proposal/Intervening Event, Giants shall, and shall use commercially reasonable efforts to cause its Representatives to, negotiate with the Jaguar Parties in good faith (to the extent the Jaguar Parties desire to negotiate) to make such adjustments in the terms and conditions of this Agreement (A) so that, in

 

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the case of a Superior Proposal, the Superior Proposal ceases to be a Superior Proposal, and (B) in the case of an Intervening Event, as may be proposed by the Jaguar Parties, and (iii) following the end of the five (5) Business Day period, the Giants Board shall have determined in good faith, after consultation with outside legal counsel, taking into account any changes to this Agreement proposed in writing by the Jaguar Parties in response to the Notice of Superior Proposal/Intervening Event or otherwise, that (A) in the case of a Superior Proposal, the Superior Proposal giving rise to the Notice of Superior Proposal/Intervening Event continues to constitute a Superior Proposal and the failure to make an Adverse Recommendation Change pursuant to Section 5.7(e) or terminate this Agreement pursuant to Section 8.1(c)(ii) would still reasonably be expected to be inconsistent with the directors’ duties under applicable Law, or (B) in the case of an Intervening Event, the failure to make an Adverse Recommendation Change pursuant to Section 5.7(e) would still reasonably be expected to be inconsistent with the directors’ duties under applicable Law.  Any material change to the terms of a Superior Proposal, including any change to the financial terms, shall require a new Notice of Superior Proposal/Intervening Event and Giants shall be required to comply again with the requirements of this Section 5.7(f); provided, however, that in connection with the second and any subsequent Notice of Superior Proposal/Intervening Event, if any, references to five (5) Business Days in this Section 5.7(f) shall be deemed to be references to two (2) Business Days instead.

 

(g)                                  Nothing contained in this Agreement shall prohibit Giants from complying with Rules 14a-9, 14d-9, 14e-2 and Item 1012(a) of Regulation M-A promulgated under the Exchange Act, or from issuing a “stop, look and listen” statement pending disclosure of its position thereunder or making any required disclosure to Giants’ stockholders if, in the judgment of the Giants Board, after consultation with its outside legal counsel, the failure to do so would reasonably be expected to be inconsistent with the directors’ duties under applicable Law or such disclosure is otherwise required under applicable Law; provided, however, that any disclosure other than a “stop, look and listen” or similar communication of the type contemplated by Rule 14a-9, 14d-9, 14e-2 or Item 1012(a) of Regulation M-A promulgated under the Exchange Act, an express rejection of any applicable Takeover Proposal or an express reaffirmation of the Giants Board Recommendation shall be deemed to be an Adverse Recommendation Change.

 

(h)                                 For purposes of this Agreement:

 

(i)                                     Intervening Event” shall mean any material event, fact, circumstance, change, development or occurrence that arises or otherwise becomes known from or after the date of this Agreement  that is unknown and not reasonably foreseeable to or by the Giants Board as of the date of this Agreement (or if known, the magnitude or material consequences of which were not known or understood by the Giants Board as of the date hereof), which material event, fact, circumstance, change, development, occurrence, magnitude or material consequence becomes known to or by the Giants Board prior to obtaining the Giants Stockholder Approval; provided, that in no event shall any of the following events, developments or changes constitute an Intervening Event:  (A) the receipt, existence or terms of a Takeover Proposal; (B) changes in market price or trading volume of the Giants Shares in and of itself (provided that the underlying causes of any such decline may be considered in determining whether an Intervening Event has occurred); and (C) the fact that Giants exceeds any internal projections, budget forecasts or third-party revenue or earnings

 

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predictions or other analysts expectations, projections, forecasts or budgets for any period in and of itself (provided that the underlying causes of any such event may be considered in determining whether an Intervening Event has occurred).

 

(ii)                                  Superior Proposal” means a bona fide written Takeover Proposal (except that for purposes of this definition, the references in the definition of “Takeover Proposal” to “20%” shall be replaced by “50%”) made by a third party after the date hereof which the Giants Board determines in good faith, in consultation with its legal and financial advisors and taking into account all financial, legal, regulatory and any other aspects that the Giants Board deems relevant, (i) is on terms and conditions more favorable from a financial point of view to the stockholders of Giants than those contemplated by this Agreement (taking into account, without limitation, any termination fees and expense reimbursement provisions contemplated by this Agreement or the Takeover Proposal) and (ii) is reasonably likely to be consummated (if accepted) on the terms proposed.

 

(iii)                               Takeover Proposal” means any proposal, offer or inquiry made by a Person or “group” (as such term is defined in Rule 13d-3 promulgated under the Exchange Act), whether in one transaction or a series of related transactions, relating to (i) a merger, consolidation, spin-off, share exchange (including a split-off), business combination or similar transaction involving Giants or any Giants Subsidiary representing assets that generate 20% or more of the net revenues or net income of the consolidated assets of Giants and the Giants Subsidiaries, or represent 20% or more of the consolidated assets of Giants and the Giants Subsidiaries, taken as a whole, determined on a book-value basis (including any indebtedness secured solely by such asset) immediately prior to such transaction (ii) a sale, contribution, exchange, transfer or other disposition (including by way of merger, consolidation, joint venture, business combination, share exchange or similar transaction), of assets that generate 20% or more of the net revenues or net income of the consolidated assets of Giants and the Giants Subsidiaries, or represent 20% or more of the consolidated assets of Giants and the Giants Subsidiaries, taken as a whole, determined on a book-value basis (including any indebtedness secured by such asset) immediately prior to such transaction, (iii) a purchase, issuance, sale or contribution of shares of capital stock or other securities (including by way of merger, consolidation, joint venture, business combination, share exchange or similar transaction), representing 20% or more of the voting power of the capital stock of Giants, (iv) any tender offer or exchange offer in which such Person or “group” seeks to acquire beneficial ownership (as such term is defined in Rule 13d-3 promulgated under the Exchange Act), or the right to acquire beneficial ownership, of 20% or more of the outstanding Giants Shares, (v) an issuance of OP Units representing 20% or more of the OP Units, including by way of property, partnership interest or limited liability company interest contribution or (vi) a reorganization, recapitalization, liquidation or dissolution of Giants and/or the Operating Partnership.  Notwithstanding anything to the contrary, (A) a proposal or offer shall not be deemed to be a Takeover Proposal if it is only with respect to the Giants Marketed Properties or any other individual Giants Property and (B) in calculating the 20% of assets figure provided for in subclause (ii) of this definition, the Giants Marketed Properties shall not be considered “assets” of Giants and the Giants Subsidiaries.

 

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Section 5.8.                                                         Credit Facility.

 

(a)                                 The Parties acknowledge that the Credit Facility is necessary to consummate the Transactions and fund the Credit Facility Amount.  The Jaguar Parties shall take the lead in arranging the Credit Facility and shall use commercially reasonable efforts to take, or cause to be taken, all actions and do, or cause to be done, all things that are within the Jaguar Parties’ control and are reasonably necessary or advisable to obtain the Credit Facility on or immediately prior to the Closing, which shall have a maturity date at least twelve (12) months after the date of the loan and be on market terms.  Without limiting the generality of the foregoing, such actions shall include, to the extent reasonably necessary or advisable to obtain and close the Credit Facility, the following:  (i) using commercially reasonable efforts to identify and contact potential lenders; (ii) preparation of any materials related to marketing the Credit Facility to the extent reasonably requested by the Financing Sources; (iii) participation in and assistance with the preparation of rating agency presentations and meetings with rating agencies; (iv) delivery to the Financing Sources of the Credit Facility Information, including:  (x) such other financial, operating, property, tenant and lease data and information regarding the Jaguar Parties, the Jaguar Included Properties or the Transactions reasonably required by the Financing Sources in connection with the Credit Facility, (y) any existing third-party reports regarding the Jaguar Included Properties and (z) any rent rolls, schedules of tenant security deposits, aging reports, schedules of outstanding tenant improvement and leasing commissions, insurance policies, existing surveys, existing zoning reports, leases, management agreements and licenses reasonably requested by the Financing Sources; (v) at the reasonable request of the Financing Sources, using commercially reasonable efforts to deliver any requests for, and to reasonably cooperate with the Jaguar Parties in seeking to obtain, consents, landlord waivers and estoppels, or non-disturbance agreements to the applicable counterparties; (vi) granting the Financing Sources and their Representatives access to the Jaguar Included Properties (including related documentation or other items in the Jaguar Parties’ possession or control) in order to conduct field examinations, collateral audits, asset appraisals, surveys, environmental site assessments and engineering/property condition reports and other inspections that are reasonably necessary in connection with the Credit Facility, including taking and analyzing any samples of any environmental media or any building material or performing any invasive environmental testing on any Jaguar Included Property, but only to the extent such sampling and/or invasive testing is reasonably recommended pursuant to a third-party environmental report and reasonably required by such Financing Source; (vii) using commercially reasonable efforts to facilitate such actions as are reasonably requested by the Financing Sources to satisfy all Credit Facility Conditions that are in the control of the Giants Parties; and (viii) participating in negotiating Credit Facility Documents.

 

(b)                                 The Jaguar Parties shall (x) keep the Giants Parties informed, periodically and upon the reasonable request of the Giants Parties, in reasonable detail of the status of its efforts to arrange the Credit Facility and (y) give the Giants Parties prompt notice of any change, event, occurrence or circumstance that has had or is reasonably likely to have, individually or in the aggregate, a material adverse impact with respect to obtaining the Credit Facility of which the Jaguar Parties become aware or any termination or threatened termination in writing thereof; provided, that in no event will the Jaguar Parties be under any obligation to disclose any information that is subject to any applicable legal privileges (including the attorney-client

 

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privilege) or subject to confidentiality obligations that do not permit disclosure to the Giants Parties.

 

(c)                                  Notwithstanding anything to the contrary contained in this Agreement, nothing contained in this Agreement shall require, and in no event shall the commercially reasonable efforts of the Giants Parties or Jaguar Parties be deemed or construed to require, the Giants Parties or Jaguar Parties to (i) pay any amounts, fees or expenses materially in excess of those contemplated in Section 5.8(c) of the Jaguar Disclosure Letter  (whether to secure waiver of any conditions therein or otherwise) or (ii) consummate the Closing at any time prior to the date determined in accordance with Section 2.1.

 

(d)                                 The Giants Parties shall use the proceeds from the Credit Facility for the purposes set forth in the definition of Closing Date Payments.

 

Section 5.9.                                                         Assistance with Credit Facility.  The Giants Parties acknowledge that the Jaguar Parties intend to pursue the Credit Facility and agree to provide such assistance (and to cause their respective Representatives to provide such assistance) in connection with obtaining the Credit Facility as is reasonably requested by the Jaguar Parties.  Such assistance by the Giants Parties shall include the following to the extent reasonably requested by the Jaguar Parties with respect to the Credit Facility:  (i) participation in and assistance with any materials related to marketing and syndication of the Credit Facility to potential lenders; (ii) participation in and assistance with the preparation of rating agency presentations and meetings with rating agencies; (iii) delivery to the Jaguar Parties and their financing sources of the Credit Facility Information, including:  (x) such financial, operating, property, tenant and lease data and information regarding the Giants Parties, the Giants Properties or the Transactions reasonably required in connection with the Credit Facility; (y) any existing third-party reports regarding the Giants Properties and (z) any rent rolls, schedules of tenant security deposits, aging reports, schedules of outstanding tenant improvement and leasing commissions, insurance policies, existing surveys, existing zoning reports, leases, management agreements and licenses; (iv) at the reasonable request of the Jaguar Parties and the Financing Sources, using commercially reasonable efforts to deliver any requests for, and to reasonably cooperate with the Jaguar Parties in seeking to obtain, consents, landlord waivers and estoppels, or non-disturbance agreements to the applicable counterparties; (v) granting the Jaguar Parties and the Financing Sources and their Representatives access to Giants Properties (including related documentation or other items in the Giants Parties’ possession or control) in order to conduct field examinations, collateral audits, asset appraisals, surveys, environmental site assessments and engineering/property condition reports and other inspections that are reasonably necessary in connection with the Credit Facility, including taking and analyzing any samples of any environmental media or any building material or performing any invasive environmental testing on any Giants Property, but only to the extent such sampling and/or invasive testing is reasonably recommended pursuant to a third-party environmental report and reasonably required by such Financing Source; (vi) taking such actions as are reasonably requested by the Jaguar Parties or the Financing Sources to facilitate the satisfaction on a timely basis of all Credit Facility Conditions that are in the control of the Giants Parties, and (vii) executing and delivering Credit Facility Documents; and (viii) using commercially reasonable efforts to arrange for (x) a customary payoff letter (in form and substance reasonably acceptable to the Jaguar Parties) to be delivered at or prior to Closing relating to the payoff and termination of the Giants Parties Credit Agreement, duly executed by

 

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the administrative agent thereof, and setting form all amounts necessary to be paid in order to fully pay off all of the amounts outstanding under the Giants Parties Credit Agreement, and providing that, upon such payment, such indebtedness will be extinguished and all Liens relating thereto will be released (the “Payoff Letter”) and (y) customary Lien release instruments, filings and documentation to be delivered at or prior to closing in respect of the Payoff Letter, and (ix) if and as necessary to timely consummate the Transactions, consummate the Credit Facility, in the event that the conditions set forth in Sections 7.1 and 7.2 and the conditions to the Credit Facility have been satisfied or, upon funding, would be satisfied.

 

Section 5.10.                                                  Certain Pre-Closing Actions.

 

(a)                                 Prior to the Closing, the Jaguar Parties shall cause the actions set forth on Section 5.10(a) of the Jaguar Disclosure Letter that are contemplated to be taken prior to the Closing (collectively, the “Restructuring Transactions”) to be implemented as set forth therein provided, however, the Parties agree to modifications to such Restructuring Transactions so long as such modifications do not adversely affect Giants or any Giants Subsidiaries.

 

(b)                                 The Jaguar Parties shall use commercially reasonable efforts to cause the applicable Jaguar Funds to have completed, and paid in full for, the acquisition of the Included Interests set forth on Section 5.10(b) of the Jaguar Disclosure Letter prior to or concurrently with the Closing.

 

(c)                                  The Jaguar Parties and their Subsidiaries shall use commercially reasonable efforts prior to the Closing, to take such actions as may be necessary so that at Closing it has the capacity, after taking into account the services to be provided under the Transition Services Agreement, to cause Giants to continue to maintain material compliance with Section 404 of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated thereunder and related or similar rules and regulations promulgated by any other governmental or self-regulatory entity or agency with jurisdiction over Giants.

 

Section 5.11.                                                  Rule 3-14/Regulation S-X Cooperation.  Without limiting the obligations of the Jaguar Parties under this Section 5.11, from the date of this Agreement and continuing through the first (1st) anniversary of the Closing Date, the Jaguar Parties shall, within thirty (30) days of the date of this Agreement, provide:

 

(a)                                 the Giants Parties and their Representatives with financial statements (prepared from the books and records of the Jaguar Parties,  in accordance with GAAP applied on a consistent basis during the periods involved and fairly presenting, in all material respects, the financial position and results of operations of the relevant Jaguar Party, as of the times and for the periods referred to therein) and access to all financial and other information pertaining to the Jaguar Parties and the Jaguar Included Properties pertaining to the period of the Jaguar Parties’ ownership and operation of the Jaguar Included Properties to the extent in the Jaguar Parties’ possession or control (or to the extent the Jaguar Parties could obtain such information without unreasonable effort or expense), which information is relevant and reasonably necessary, in the opinion of the Giants Parties, for the preparation and filing of financial statements in compliance with the requirements of any or all of (x) Rules 3-12 and 3-14 of Regulation S-X of the SEC, or if required by the SEC, Rule 3-05 of Regulation S-X of the SEC, and enable the

 

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Giants Parties’ outside, third-party accountants (the “Accountants”) to audit such information, (y) any other rule issued by the SEC and applicable to the Giants Parties or their Affiliates, and (z) any registration statement, schedule, proxy statement, report or disclosure statement filed with the SEC by or on behalf of the Giants Parties or their Affiliates; and

 

(b)                                 reasonable assistance to the Giants Parties and the Accountants in completing audits and the preparation of such financial statements and any required pro forma financial statements.  Without limiting the generality of the foregoing, if requested by the Giants Parties (A) the Jaguar Parties shall deliver a customary representation letter in such form as is reasonably required by the Accountants, with such facts and assumptions as reasonably determined by the Accountants in order to make such certificate accurate, signed by the individual(s) responsible for the Jaguar Parties’ financial reporting, as prescribed by GAAP promulgated by the Auditing Standards Division of the American Institute of Certified Public Accountants, which representation letter may be required to assist the Accountants in rendering an opinion on such financial statements in order to comply with subclauses (x), (y) and (z) of Section 5.11(a) above and (B) to the extent that the Jaguar Parties’ financial statements have previously been audited, the Jaguar Parties shall use commercially reasonable efforts to cause the auditor of the Jaguar Parties’ financial statements to provide its consent to the inclusion of its report, without exception or qualification, with respect to such audited financial statements, to provide to the Giants Parties and/or their Affiliates or the underwriters or initial purchasers in any financing with appropriate comfort letters in accordance with the American Institute of Public Accountants’ professional standards and to participate in due diligence sessions customarily conducted in connection with the provision of comfort letters.

 

Section 5.12.                                                  Jaguar Party Exclusivity.  From the date of this Agreement until the Closing or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, each Jaguar Party shall not, and shall cause each of its Affiliates not to, and shall direct its Representatives not to, directly or indirectly (a) except as permitted under Section 5.5 solicit, initiate, knowingly facilitate or otherwise enter into any discussions, negotiations or agreements which could reasonably be expected to lead to a possible sale or other disposition of (i) all or any of the Jaguar Included Assets, other than as specifically required pursuant to the terms of any right of first refusal of Jaguar described in Section 6.1(b) or Section 6.1(c) or in connection with a sale permitted under Section 5.5(b)(vii), or (ii) except as contemplated by the Restructuring Transactions or as permitted under Section 5.5(b)(i), all or any part of the ownership interests in the Jaguar Parties (whether by merger, reorganization, recapitalization or otherwise) that are proposed to be transferred to the Giants Parties pursuant to the Transactions, in each case with any Person other than the Giants Parties or provide any non-public information regarding the Jaguar Included Assets to any Person other than the Giants Parties and their Affiliates and Representatives and Financing Sources other than as required by applicable Law or as specifically required pursuant to the terms of any Contract affecting a Jaguar Included Property or Joint Venture Agreement, in each case excluding any information which is traditionally provided in the regular course of the Jaguar Parties’ operation and management of the Jaguar Included Properties to third parties where the Jaguar Parties and their Affiliates and Representatives have no reason to believe that such information may be utilized to evaluate any such transaction; or (b) take any further action pursuing an initial public offering of common shares of beneficial interest of JBG Realty Trust on Form S-11 with the SEC (the “Proposed Jaguar IPO”).

 

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Section 5.13.                                                  NYSE Listing.  Giants shall use its commercially reasonable efforts to cause the Issued Giants Shares to be approved for listing on the NYSE prior to the Closing Date, subject only to official notice of issuance.

 

Section 5.14.                                                  OPP Termination Agreement.  The Parties hereto acknowledge and agree that, in accordance with the terms of the OPP Termination Agreement, the effectiveness of which is contingent upon the occurrence of the Closing, (1) immediately prior to the Closing, 2,865,916 Award LTIP Units will be deemed to be earned, in addition to the 1,172,738 Award LTIP Units earned through April 15, 2016 under the terms of the OPP Agreement, and all other Award LTIP Units will be forfeited, (2) all Award LTIP Units treated as earned, or deemed to be, earned, will become fully vested (the “Vested LTIP Units”) and all other LTIP Units will be forfeited, (3) immediately after the Award LTIP Units become Vested LTIP Units and following the Book-Up, but immediately prior to Closing, all Vested LTIP Units will convert into an equal number of OP Units and (4) concurrent with Closing and on the same day as such conversion, all such OP Units will be redeemed for an equal number of Giants Shares.

 

Section 5.15.                                                  Giants Board of Directors and Officers.  Giants shall use commercially reasonable efforts to cause each member of the Giants Board other than Randolph Read to deliver to Giants an irrevocable written resignation from the Giants Board, effective as of the Closing (collectively, the “Giants Board Resignations”).  The Giants Board shall take or cause to be taken such action as may be necessary, in each case, to be effective as of the Closing, to (i) increase the number of directors to nine (9) and to cause the Jaguar Designees (as defined below) and the Giants Board Designee to compose the entire Giants Board (such persons, and any replacement designees selected, the “Board Designees”), (ii) appoint Michael Glosserman and Robert Stewart as Co-Chairmen of the Giants Board, and (iii) appoint, at the direction of the Jaguar Parties, the Board Designees to the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee.  The Board Designees shall include eight (8) individuals designated by the Jaguar Parties (the “Jaguar Board Designees”) and one (1) individual designated by Giants (who shall be Randolph Read unless he is unable or unwilling to serve as director as of the Closing) (the “Giants Board Designee”).  The initial Jaguar Designees shall be the eight (8) individuals listed on Section 5.15 of the Jaguar Disclosure Letter.  A majority of the Board Designees shall be independent as determined under the applicable NYSE independence rules.  If any of such persons is unable or unwilling to serve on the Giants Board, as of the Closing, the Jaguar Parties (in the case of any Board Designee initially designated by the Jaguar Parties) or Giants (in the case of the Giants Board Designee) shall select, within a reasonable period of time prior to the Closing, a replacement, which designee shall (i) not violate any of the NYSE independence tests set forth in Section 303A.02(b) of the NYSE Listed Company Manual, (ii) satisfy the nominating criteria of the Nominating and Corporate Governance Committee of the Giants Board, and (iii) not be subject to any disclosures required under Rule 401(f) of Regulation S-K.  Subject to the foregoing, the Giants Board shall elect such replacement as a member of the Giants Board, as of the Closing.  If any executive officer set forth on Section 3.28(b) of the Giants Disclosure Letter is unable or unwilling to serve as an executive officer as of the Closing, then the Jaguar Parties shall select, within a reasonable period of time prior to the Closing, a replacement, which replacement shall be subject to the approval of the Giants Board, such approval not to be unreasonably withheld, conditioned or delayed.  Subject to the foregoing, the Giants Board shall elect such replacement to such office, as of the Closing.

 

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Section 5.16.                                                  Giants Charter and Partnership Agreement Amendment.  Prior to the Closing, the Giants Board, in accordance with the Giants Charter, shall amend the Giants Charter to (a) change the name of Giants effective as of the Closing to Jaguar Realty Trust, Inc. and, in accordance with MGCL Section 2-605, without any further action by any of Giants’ stockholders, and (b) authorize the increase of the number of authorized shares of Giants Common Stock to 800,000,000 shares, such increase to be effective prior to the Closing, without any further action by any of Giants’ stockholders (the amendments described in clauses (a) and (b), the “Giants Charter Amendment”).  Giants shall take all actions necessary to adopt the Partnership Agreement Amendment and Restatement, such amendment to become effective simultaneously with the Closing.  Giants shall file the Giants Charter Amendment with SDAT as required by the MGCL.

 

Section 5.17.                                                  REIT Ownership Waiver.  In connection with the Closing, the Giants Board, in accordance with the Giants Charter, shall exempt from the ownership limitations set forth therein, any Jaguar Party or Jaguar Designee to the extent the receipt of the Equity Consideration by such Person would result in such Person owning (constructively or beneficially) in excess of the amount permitted to be owned pursuant to such ownership limitations pursuant to an Ownership Limit Waiver Agreement between Giants and each such Person substantially in the form attached hereto as Exhibit F (each, an “Ownership Limit Waiver Agreement”); provided, however, that any such Person delivers for this purpose to Giants a customary representation letter substantially in the form of Exhibit A to such Ownership Limit Waiver Agreement and an executed signature page to such Ownership Limit Waiver Agreement; provided, further, that any such Ownership Limit Waiver may be conditioned on the continued accuracy of such representation letter in order to protect the status of Giants as a REIT.  Notwithstanding the foregoing, the Giants Board shall not enter into an Ownership Limit Waiver Agreement if it would cause any individual, within the meaning of Section 542(a)(2) of the Code, to “Beneficially Own” Giants Shares in excess of the “Aggregate Share Ownership Limit” as such terms are defined in the Giants Charter.

 

Section 5.18.                                                  Giants Officers Certificate.  Giants shall deliver to Proskauer Rose LLP an officer’s certificate, dated as of the Closing Date, signed by an officer of Giants and the Operating Partnership with the knowledge necessary to make the representations contained therein and in form and substance reasonably satisfactory to the Jaguar Parties, containing representations of Giants and the Operating Partnership as shall be reasonably necessary or appropriate to enable Proskauer Rose LLP to render the opinion described in Section 7.3(g) on the Closing Date.

 

Section 5.19.                                                  Jaguar Officers Certificate.  The Jaguar REITs shall each deliver to Hogan Lovells US LLP an officer’s certificate, dated as of the Closing Date, signed by an officer of such Jaguar REIT with the knowledge necessary to make the representations contained therein and in form and substance reasonably satisfactory to the Giants Parties, containing representations of the Jaguar REITs as shall be reasonably necessary or appropriate to enable Hogan Lovells US LLP to render the opinions described in Section 7.2(g) on the Closing Date.  The Jaguar Parties shall deliver to Proskauer Rose LLP an officer’s certificate, dated as of the Closing Date, signed by an officer of the relevant Jaguar Party with the knowledge necessary to make the representations contained therein and in form and substance reasonably satisfactory to Proskauer Rose LLP, containing representations of the Jaguar Parties as shall be reasonably

 

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necessary or appropriate to enable Proskauer Rose LLP to render the opinion described in Section 7.3(g) on the Closing Date.

 

Section 5.20.                                                  Roll-Forward Balance Sheet Matters.

 

(a)                                 Prior to the Closing, the Jaguar Parties shall provide the Giants Parties with true, complete and correct supporting documentation evidencing the amount of Net Invested Capital between April 1, 2016 and the earlier of (i) the Closing Date, or (ii) September 30, 2016.

 

(b)                                 The Included Entities shall not use any of (i) the cash that would be that would be required to be reflected on their respective balance sheets prepared in accordance with GAAP at March 31, 2016, (ii) Net Cash Flow generated from and after April 1, 2016 or (iii) Net Invested Capital generated from and after April 1, 2016, for any purpose other than a use related to the operation of the Jaguar Included Properties, transaction expenses for which the Jaguar Funds are entitled to reimbursement under this Agreement or Distributions that are not prohibited under Section 5.5(b)(i).

 

ARTICLE VI

 

ADDITIONAL AGREEMENTS

 

Section 6.1.                                                         ROFRs and Tenant Estoppels under Ground Leases and Joint Venture Agreements.

 

(a)                                 The Jaguar Parties shall use commercially reasonable efforts to obtain prior to the Closing from each of the ground lessors under the Jaguar Ground Leases listed on Section 4.9(h) of the Jaguar Disclosure Letter, a ground lease estoppel substantially in the form of Exhibit G hereto or such other form or terms as is provided under the applicable Jaguar Ground Lease, if applicable.  The Jaguar Parties shall keep the Giants Parties reasonably informed regarding the status of the discussions with the applicable ground lessors regarding the foregoing matters from time to time prior to the Closing and shall within a reasonable period of time, provide the Giants Parties with any estoppel received under this Section 6.1.  In no event will failure to obtain a ground lease estoppel be a condition to the Closing.

 

(b)                                 With regard to any Jaguar Included Property located in Montgomery County that is a multifamily property that already has leases, which Jaguar Included Properties are listed on Section 6.1(b) of the Jaguar Disclosure Letter (the “Jaguar Montgomery County Multifamily Properties”), the Parties acknowledge that the Transactions may be subject to the requirements imposed by Section 11C-18 and Chapter 53A of the Code of Ordinances (said referenced sections, the “Ordinances”) of Montgomery County, Maryland (the “County”), pursuant to which the County and certain other entities, organizations and persons (the County and such other entities, organizations and persons, collectively, the “Montgomery County Rights Holders”) may be entitled to notice of any sale of certain rental housing projects in the County, and may have a right of first refusal to acquire such a project on substantially the same terms and conditions as a pending bona fide contract of sale from a third party to buy the rental housing.  For each Jaguar Montgomery County Multifamily Property, to the extent such Jaguar Party is required to provide a right of first refusal, said right of first refusal shall be for the purchase price

 

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set forth on Section 6.1(b) of the Jaguar Disclosure Letter or as otherwise required by the Ordinances.

 

(c)                                  With regard to any Jaguar Included Property located in the District of Columbia that is a multifamily property that already has leases, which Jaguar Included Properties are listed on Section 6.1(c) of the Jaguar Disclosure Letter (the “Jaguar District of Columbia Multifamily Properties”), the Parties acknowledge that the Transactions may be subject to the requirements imposed by Subchapter IV of Section 42-3404 of the District of Columbia Code (“TOPA”) pursuant to which the tenants of said Jaguar District of Columbia Multifamily Properties (collectively, the “DC Rights Holders”) are entitled to notice of any sale of certain rental housing projects in the District of Columbia.  For each Jaguar District of Columbia Multifamily Property, to the extent such Jaguar Party is required to provide a right of first refusal, said right of first refusal shall be for the purchase price set forth on Section 6.1(c) of the Jaguar Disclosure Letter.

 

(d)                                 Such Jaguar Party shall prepare all required notices and take all required steps as required under the Ordinances and TOPA as promptly as reasonably possible after the date hereof in consultation with Giants and may enter into such settlements and agreements with the Montgomery County Rights Holders and the DC Rights Holders with the approval of Giants, which shall not be unreasonably withheld.

 

(e)                                  Should Montgomery County Rights Holders or DC Rights Holders exercise their right to purchase and close such purchase of the applicable Jaguar Included Property, (a) the applicable Jaguar Party shall notify the Giants Party of the same, and (b) the net purchase price paid or payable to the applicable Jaguar Party with respect to the applicable Jaguar Included Property shall be included in the Included Assets.

 

Section 6.2.                                                         Casualty and Condemnation.  The risk of loss relating to the Giants Properties and the Jaguar Included Properties prior to the Closing shall be borne by the Giants Parties if the Transaction closes and the Closing shall not be affected by a condemnation or casualty.  If, prior to the Closing, (a) any Jaguar Included Property is materially or totally destroyed or damaged by fire or other casualty or (b) any Jaguar Included Property is materially or totally taken by eminent domain or through condemnation proceedings, then at Closing any sums collected (directly or indirectly) by the Jaguar Party, if any, under any policies of insurance or award proceeds relating to such casualty or condemnation, which have not been applied to repair or replacement of any such damage or destruction shall be paid to (or retained by) Giants, and all rights (directly or indirectly) of the Jaguar Parties to collect such sums as may then be uncollected shall be included in the Included Assets, except to the extent required for collection costs or repairs by Jaguar Party prior to the Closing Date.

 

Section 6.3.                                                         Tax Matters.

 

(a)                                 The Giants Parties and the Jaguar Parties and their respective Affiliates will reasonably cooperate, to the extent reasonably requested by any of the Giants Parties, Jaguar Parties and their respective Affiliates, in connection with any Tax matters relating to the Jaguar Included Properties or the Transactions (including by the provision of reasonably relevant records or information reasonably available to such party, which shall include depreciation

 

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methodology and other Tax information necessary for the preparation and filing of any Tax return).  The Giants Parties and the Jaguar Parties agree and shall cause their respective Affiliates (i) to retain all books and records with respect to Tax matters pertinent to the Jaguar Included Properties and the Transactions relating to any taxable period beginning before the Closing Date until the expiration of the statute of limitations (and, to the extent notified by the Giants Parties or Jaguar Parties, as applicable, any extensions thereof) of the respective taxable periods, and to substantially abide by all record retention agreements entered into with any Tax authority or other Governmental Entity, and (ii) to give the other parties reasonable written notice prior to transferring, destroying or discarding any such books and records and, upon reasonable request, the Giants Parties or the Jaguar Parties or their respective Affiliates, as the case may be, shall furnish or cause to be furnished to the other parties or allow the other parties access to such books and records.

 

(b)                                 The Giants Parties and the Jaguar Parties and their respective Affiliates will cooperate in the preparation, execution and filing of all returns, questionnaires, applications or other documents regarding any real property transfer or gains, sales, use, transfer, value added, stock transfer or stamp taxes, any transfer, recording registration and other fees and any similar taxes that become payable in connection with the Transactions (together with any related interest, penalties or additions to Tax, “Transfer Taxes”), and shall cooperate in attempting to minimize the amount of Transfer Taxes.  From and after the Closing, Giants shall pay or cause to be paid, without deduction or withholding from any consideration or amounts payable pursuant to this Agreement, all Transfer Taxes resulting from the transactions contemplated by Section 1.1; provided, that for the avoidance of doubt, the Jaguar Parties and their respective Affiliates shall be liable for and shall pay or cause to be paid all Taxes (excluding Transfer Taxes previously described in this Section 6.3(b)) that may be incurred by them as a result of the Restructuring Transactions..

 

(c)                                  The Parties agree that the combined enterprise value of Giants and the Operating Partnership immediately prior to the transactions contemplated in Section 1.1 shall be equal to 34.8% of the combined enterprise value of Giants and the Operating Partnership immediately following the consummation of the transactions contemplated in Section 1.1 as determined based upon the trading price of the Giants Common Stock on the Closing Date. (the “Giants Valuation”); provided, that the Giants Valuation shall be modified or adjusted as reasonably necessary to reflect any adjustments to the Cash Consideration and the Equity Consideration in accordance with this Agreement.  Giants, as general partner of the Operating Partnership, shall adjust the Gross Asset Value (as defined in the Partnership Agreement) of the Operating Partnership’s assets immediately prior to the consummation of the transactions contemplated in Section 1.1 (the “Historic Giants Assets”) in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) and paragraph (b)(i) of the definition of Gross Asset Value, and consistent with the Giants Valuation, and the capital accounts of the partners of the Operating Partnership who were partners immediately prior to the consummation of the transactions contemplated in Section 1.1, including the holders of Award LTIP Units that are treated as “Vested LTIP Units,” in accordance with the OPP Termination Agreement, shall be adjusted to reflect such adjustment to the Gross Asset Value of the Historic Giants Assets (the “Book-Up”), which shall include adjusting, to the extent possible, the LTIP Economic Capital Account Balances (as defined in the Partnership Agreement) of the holders of such Vested LTIP

 

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Units, as determined on a per unit basis, to be equal to the OP Unit Economic Balance (as defined in the Partnership Agreement).

 

(d)                                 The Giants Parties agree to report for U.S. federal income tax purposes the contribution transactions described in Sections 1.1(a)-(k) in the manner set forth in the relevant Contribution Agreement or Merger Agreement.

 

Section 6.4.                                                         Jaguar Party Employee Matters.

 

(a)                                 Employees.  Following the Closing, a Giants Party or its Affiliate shall continue to employ each Jaguar Employee who is employed by a Jaguar Party as of the Closing.  Each Jaguar Employee who so remains in active employment with a Giants Party or an Affiliate thereof shall hereinafter be referred to as a “Continuing Employee” as of the Closing.

 

(b)                                 No Severance Obligations.  The Giants Parties and the Jaguar Parties intend that the Transactions shall not result in a separation of employment of any Continuing Employee for purposes of any Jaguar Benefit Plan prior to or upon the consummation of the Transactions and that the Continuing Employees will have continuous and uninterrupted employment for such purposes immediately before and immediately after the Closing Date, and the Giants Parties and the Jaguar Parties shall make reasonable efforts to ensure the same.

 

(c)                                  WARN Act.  Without limiting any other provision hereof, the Jaguar Parties shall be solely responsible for complying with the WARN Act and any and all obligations under other applicable Laws requiring notice of plant closings, relocations, mass layoffs, reductions in force or similar actions (and for any failures to so comply), in any case, applicable to the Jaguar Employees as a result of any action by any Jaguar Party on or prior to the Closing Date.

 

(d)                                 Collective Bargaining Agreements.  The Jaguar Parties shall, or shall cause their Affiliates, consistent with applicable Law, to bargain in good faith and consistent with past practice with any union that has been certified or recognized as the collective bargaining representative of any Continuing Employees who are employed by the Jaguar Parties and/or their Affiliates; to assume all obligations to any such employees under all collective bargaining, works council or other similar employee representative agreements; and to cooperate and take all reasonable steps and fulfill all of their respective obligations under applicable Law and the terms of such collective bargaining, works council or other similar employee representative agreements, including obtaining any prior approvals or consents, or engaging in any prior discussions or consultations, on a timely basis, as may be legally required in order for the Jaguar Parties and their Affiliates to assume such obligations.  This Agreement shall only be subject to such agreements, if any, that result from such bargaining, if such agreements are approved by the Giants Parties, in their sole and absolute discretion after discussions with the Jaguar Parties.

 

(e)                                  No Third Party Beneficiaries; No Continued Service or Service Terms.  The provisions of this Section 6.4 are solely for the benefit of the Parties and nothing in this Section 6.4, express or implied, shall confer upon any employee, consultant, manager or other service provider (or any dependent, successor, legal representative or beneficiary thereof), any

 

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rights or remedies, including any right to continuance of employment or any other service relationship with the Giants Parties or any of their Affiliates, or any right to compensation or benefits of any nature or kind whatsoever under this Agreement.  Nothing in this Section 6.4, express or implied, shall be:  (i) an amendment or deemed amendment of any plan providing benefits to any employee, or (ii) construed to interfere with the right of the Giants Parties or their Affiliates to terminate the employment or other service relationship of any of the Continuing Employees at any time, with or without cause, or restrict any such entity in the exercise of their independent business judgment in modifying any of the terms and conditions of the employment or other service arrangement of the Continuing Employees, or (iii) deemed to obligate the Giants Parties or any of their Affiliates to adopt, enter into or maintain any employee benefit plan or other compensatory plan, program or arrangement at any time.

 

(f)                                   The Jaguar Management Entities, on behalf of Giants, may offer employment to the employees of AR Global Investments, LLC or its Affiliates listed on Section 6.4(f) of the Giants Disclosure Letter, such employment to be effective on or after the Closing.

 

Section 6.5.                                                         Directors’ and Officers’ Indemnification and Insurance.

 

(a)                                 To the fullest extent permitted by Law, from and after the Closing, Giants shall provide exculpation, indemnification and advancement of expenses for each Indemnitee, which is at least as favorable in scope and amount to such Indemnitee as the exculpation, indemnification and advancement of expenses provided to such Indemnitee by Giants and the Giants Subsidiaries, as applicable, immediately prior to the Closing in the Giants Charter and the Giants Bylaws or each of the Giants Subsidiaries’ respective articles or certificates of incorporation or bylaws (or comparable organizational or governing documents), as in effect on the date of this Agreement; provided that such exculpation, indemnification and advancement of expenses covers actions and omissions at or prior to the Closing, including all Transactions.

 

(b)                                 Prior to the Closing, Giants shall obtain and fully pay the premium for the non-cancellable extension of the coverage afforded by Giants’ existing directors’ and officers’ liability insurance policies and Giants’ existing fiduciary liability insurance policies (collectively, the “D&O Insurance”), in each case, for a claims reporting or discovery period of at least six (6) years from and after the Closing with respect to any claim related to any period of time at or prior to the Closing from one or more insurance carriers with the same or better credit rating as Giants’ current insurance carrier with respect to D&O Insurance with terms, conditions and retentions that are no less favorable in the aggregate than the coverage provided under Giants’ existing policies and with limits of liability that are no lower than the limits on Giants’ existing policies.  If Giants for any reason fails to obtain such “tail” insurance policies as of the Closing, Giants shall continue to maintain in effect, for a period of at least six (6) years from and after the Closing, the D&O Insurance in place as of the date hereof with Giants’ current insurance carrier or with an insurance carrier with the same or better credit rating as Giants’ current insurance carrier with respect to D&O Insurance with terms, conditions, retentions and limits of liability that are no less favorable in the aggregate than the coverage provided under the Giants’ existing policies as of the date hereof; provided, however, that Giants shall not be required to pay an annual premium for the D&O Insurance in excess of 300% of the annual premium currently paid by Giants for such insurance; and provided, further, that if the annual premiums of such insurance coverage exceed such amount, Giants shall be obligated to obtain a

 

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policy with the greatest coverage available, with respect to matters occurring prior to the Closing, for a cost not exceeding such amount.

 

(c)                                  The Indemnitees to whom this Section 6.5 applies are intended to be third-party beneficiaries of this Section 6.5.  The provisions of this Section 6.5 are intended to be for the benefit of each Indemnitee and his or her successors, heirs, executors, trustees, fiduciaries, administrators or representatives.  Giants shall pay all reasonable expenses, including attorneys’ fees, that may be incurred by any Indemnitee in successfully enforcing the indemnity and other obligations provided in this Section 6.5.

 

(d)                                 The rights of each Indemnitee under this Section 6.5 shall be in addition to, and shall not be deemed to be exclusive of, any rights such Person or any employee of Giants or any Giants Subsidiary may have under the Giants Charter, the Giants Bylaws or the certificate of incorporation or bylaws (or equivalent organizational or governing documents) of any of the Giants Subsidiaries, or under any applicable Law or under any agreement of any Indemnitee or any employee with Giants or any Giants Subsidiaries.  Nothing in this Agreement is intended to, shall be construed to or shall release, waive or impair any rights to directors’ and officers’ insurance claims under any policy that is or has been in existence with respect to the Giants Parties or their respective Subsidiaries or its or their respective officers, directors and employees, it being understood and agreed that the indemnification provided for in this Section 6.5 is not prior to, or in substitution for, any such claims under any such policies.

 

(e)                                  Notwithstanding anything contained in this Agreement to the contrary, this Section 6.5 shall survive the consummation of the Transactions indefinitely and shall be binding, jointly and severally, on all successors and assigns of Giants and the Giants Subsidiaries, and shall be enforceable by the Indemnitees and their successors, heirs or representatives.  In the event that Giants or any of its successors or assigns consolidates with or merges into any other Person and shall not be the continuing or surviving corporation or entity of such consolidation or merger, or transfers or conveys all or a majority of its properties and assets to any Person, then, and in each such case, proper provision shall be made so that the successors and assigns of Giants, as applicable, shall succeed to the obligations set forth in this Section 6.5.

 

Section 6.6.                                                         Further Assurances.  Upon the terms and subject to the conditions contained herein, the Parties agree, both prior to and following the Closing (for a period not to exceed twelve (12) months) (a) to use commercially reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable to consummate and make effective the transfer of the Included Interests contemplated hereunder, (b) to execute any documents, instruments or conveyances of any kind which may be reasonably necessary or advisable to carry out the transfer of the Included Interests contemplated hereunder, and (c) to cooperate with each other in connection with the foregoing.  The foregoing provisions of this Section 6.6 shall survive the Closing.  In addition, if requested by the Giants Parties, the Jaguar Parties agree prior to Closing to use commercially reasonable efforts to deliver requests for estoppels, waivers or other agreements under any covenants, conditions or restrictions or other encumbrances affecting any of the Jaguar Included Properties and Joint Venture Agreements.

 

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ARTICLE VII

 

CONDITIONS TO CONSUMMATION OF THE TRANSACTIONS

 

Section 7.1.                                                         Conditions to Each Party’s Obligations to Consummate the Transactions at the Closing.  The respective obligations of each Party to consummate the Transactions contemplated at the Closing shall be subject to the satisfaction on or prior to the Closing Date of each of the following conditions, any and all of which may be waived in whole or in part by the Giants Parties and the Jaguar Representative, as the case may be, to the extent permitted by applicable Law:

 

(a)                                 Stockholder Approval.  The Giants Stockholder Approval shall have been obtained.

 

(b)                                 Listing.  The Issued Giants Shares and Giants Shares issuable in exchange for OP Units shall have been approved for listing on the NYSE, subject only to official notice of issuance.

 

(c)                                  Laws; Court Orders.  No Law shall have been enacted or promulgated by any Governmental Entity of competent jurisdiction which prohibits or makes illegal the consummation of the Transactions, and there shall be no order or injunction of a court of competent jurisdiction in effect preventing the consummation of the Transactions.

 

(d)                                 Credit Facility.  All conditions to the closing of the Credit Facility shall have occurred and there shall be not less than the amount required to make the Credit Facility Amount available under the Credit Facility to be borrowed at the Closing; provided, however, that no Party shall be able to rely on the failure of this condition to be satisfied if such party is in breach of its obligations under Section 5.8 or Section 5.9, as applicable.

 

(e)                                  Antitrust Laws.  Any required waiting periods (or any extensions thereof) under any provision of the HSR Act, and all other all federal and state statutes, rules, regulations, orders, decrees, administrative and judicial doctrines, and other Laws that are designed or intended to prohibit, restrict or regulate actions having the purpose or effect of monopolization or restraint of trade, shall have expired, waived or been terminated.

 

(f)                                   Payoff Letters.  The Giants Parties shall have received duly executed payoff letters on behalf of the holders of any Indebtedness of Giants (other than any Indebtedness for which such holder has delivered its consent to consummation of the Closing or with respect to which such consent is not required), certifying that all such Indebtedness shall have been fully paid upon the receipt by such holder of funds pursuant to Section 5.8(d).

 

Section 7.2.                                                         Conditions to Obligations of the Giants Parties.  The obligations of the Giants Parties to consummate the Transactions shall also be subject to the satisfaction or waiver by Giants Parties (in writing) on or prior to the Closing Date of each of the following additional conditions:

 

(a)                                 Representations and Warranties.  (i) Other than the representations and warranties set forth in Section 4.1 (Organization), Section 4.2 (Authorization; Validity of

 

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Agreement), Section 4.4 (Capital Structure; Subsidiaries), Sections 4.13(b), (c), (d) and (e) (Taxes) and Section 4.27 (Brokers; Expenses), each of the representations and warranties of each of the Jaguar Parties set forth in this Agreement shall be true and correct (without giving effect to any qualification as to materiality or Jaguar Material Adverse Effect contained in Article IV) as of the date of this Agreement and as of the Closing as though made on and as of the Closing (except that representations and warranties that by their terms speak specifically as of the date of this Agreement or another date shall be true and correct (without giving effect to any qualification as to materiality or Jaguar Material Adverse Effect contained in Article IV) as of such date), except (i) where any failures of any such representations and warranties to be true and correct would not reasonably be expected to have, individually or in the aggregate, a Jaguar Material Adverse Effect, and (ii) the representations and warranties set forth in Section 4.1 (Organization), Section 4.2 (Authorization; Validity of Agreement), Section 4.4 (Capital Structure; Subsidiaries), Sections 4.13(b), (c), (d) and (e) (Taxes) and Section 4.27 (Brokers; Expenses) of each of the Jaguar Parties shall be true and correct in all material respects as of the date of this Agreement and as of the Closing Date as though made on and as of the Closing Date (except that representations and warranties that by their terms speak specifically as of the date of this Agreement or another date shall be true and correct as of such date).

 

(b)                                 Performance of Obligations of the Jaguar Parties.  Each of the Jaguar Parties shall have performed or complied in all material respects with all obligations required to be performed or complied with by such Jaguar Party under this Agreement at or prior to the Closing, including without limitation, their obligations set forth in the last sentence of Section 9.4.

 

(c)                                  No Jaguar Material Adverse Effect.  Since the date of this Agreement, there shall have been no change, event, occurrence or circumstance that has had or would reasonably be expected to have a Jaguar Material Adverse Effect.

 

(d)                                 Closing of Contribution and Merger Agreements.  The closing of the transactions contemplated by the Contribution Agreements and Merger Agreements shall have occurred or shall occur simultaneously with the Closing, unless such failure to close is the result of a breach by the Giants Parties.

 

(e)                                  Officer’s Certificate.  The Jaguar Parties shall have delivered to Giants a certificate, dated the date of the Closing and signed by the chief executive officer or another senior officer of its general partner or managing member on behalf of each of the Jaguar Parties, certifying to the effect that the conditions set forth in Section 7.2(a), Section 7.2(b) and Section 7.2(c) have been satisfied.

 

(f)                                   Jaguar Party Deliverables.  The Jaguar Parties shall have delivered to the Giants Parties at the Closing all other agreements and items set forth in Section 2.3.

 

(g)                                  REIT Opinion.

 

(i)                                     The Giants Parties shall have received a written opinion of Hogan Lovells US LLP on which Proskauer Rose LLP shall be entitled to rely in connection with its opinion rendered pursuant to Section 7.3(g), dated as of the Closing Date and in

 

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form and substance reasonably satisfactory to the Giants Parties, to the effect that, commencing with Fund VII REIT’s taxable year that ended on December 31, 2012, Fund VII REIT has been organized and operated in conformity with the requirements for qualification and taxation as a REIT under the Code and its actual method of operation has enabled Fund VII REIT to meet, through the Closing Date, and its proposed method of operation will enable Fund VII REIT to continue to meet, the requirements for qualification and taxation as a REIT under the Code (the “Fund VII REIT Opinion”), which opinion will (i) be subject to customary exceptions, assumptions and qualifications and (ii) be based on customary representations contained in an officer’s certificate from the Jaguar Parties, provided pursuant to Section 5.19, and executed by an officer with the knowledge necessary to make the representations contained therein.

 

(ii)                                  The Giants Parties shall have received a written opinion of Hogan Lovells US LLP on which Proskauer Rose LLP shall be entitled to rely in connection with its opinion rendered pursuant to Section 7.3(g), dated as of the Closing Date and in form and substance reasonably satisfactory to the Giants Parties, to the effect that, commencing with Fund VIII REIT’s taxable year that ended on December 31, 2011, Fund VIII REIT has been organized and operated in conformity with the requirements for qualification and taxation as a REIT under the Code and its actual method of operation has enabled Fund VIII REIT to meet, through the Closing Date, and its proposed method of operation will enable Fund VIII REIT to continue to meet, the requirements for qualification and taxation as a REIT under the Code (the “Fund VIII REIT Opinion”), which opinion will (i) be subject to customary exceptions, assumptions and qualifications and (ii) be based on customary representations contained in an officer’s certificate from the Jaguar Parties, provided pursuant to Section 5.19, and executed by an officer with the knowledge necessary to make the representations contained therein.

 

(iii)                               The Giants Parties shall have received a written opinion of Hogan Lovells US LLP on which Proskauer Rose LLP shall be entitled to rely in connection with its opinion rendered pursuant to Section 7.3(g), dated as of the Closing Date and in form and substance reasonably satisfactory to the Giants Parties, to the effect that, commencing with Fund IX REIT’s taxable year that ended on December 31, 2014, Fund IX REIT has been organized and operated in conformity with the requirements for qualification and taxation as a REIT under the Code and its actual method of operation has enabled Fund IX REIT to meet, through the effective time of the merger of Fund IX REIT as set forth in Section 1.1(g)(ii) and the relevant Merger Agreement, the requirements for qualification and taxation as a REIT under the Code (the “Fund IX REIT Opinion”), which opinion will (i) be subject to customary exceptions, assumptions and qualifications and (ii) be based on customary representations contained in an officer’s certificate from the Jaguar Parties, provided pursuant to Section 5. 19, and executed by an officer with the knowledge necessary to make the representations contained therein.

 

(iv)                              The Giants Parties shall have received a written opinion of Hogan Lovells US LLP with respect to each Core REIT on which Proskauer Rose LLP shall be entitled to rely in connection with its opinion rendered pursuant to Section 7.3(g), dated as of the Closing Date and in form and substance reasonably satisfactory to the Giants Parties, to the effect that, commencing with the Core REIT’s taxable year that ended on

 

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December 31 of the year for which it made its initial REIT election pursuant to Section 856(c)(1) of the Code, such Core REIT has been organized and operated in conformity with the requirements for qualification and taxation as a REIT under the Code and its actual method of operation has enabled such Core REIT to meet, through the Closing Date, and its proposed method of operation will enable such Core REIT to continue to meet, the requirements for qualification and taxation as a REIT under the Code (each such opinion a “Core REIT Opinion” and collectively, the “Core REIT Opinions”), which opinion will (i) be subject to customary exceptions, assumptions and qualifications and (ii) be based on customary representations contained in an officer’s certificate from the Jaguar Parties, provided pursuant to Section 5. 19, and executed by an officer with the knowledge necessary to make the representations contained therein.

 

(v)                                 The Giants Parties shall have received a written opinion of Hogan Lovells US LLP on which Proskauer Rose LLP shall be entitled to rely in connection with its opinion rendered pursuant to Section 7.3(g), dated as of the Closing Date and in form and substance reasonably satisfactory to the Giants Parties, to the effect that, commencing with Atlantic REIT’s taxable year that ended on December 31 of the year for which it made its initial REIT election pursuant to Section 856(c)(1) of the Code, Atlantic REIT has been organized and operated in conformity with the requirements for qualification and taxation as a REIT under the Code and its actual method of operation has enabled Atlantic REIT to meet, through the Closing Date, and its proposed method of operation will enable Atlantic REIT to continue to meet, the requirements for qualification and taxation as a REIT under the Code (the “Atlantic REIT Opinion”), which opinion will (i) be subject to customary exceptions, assumptions and qualifications and (ii) be based on customary representations contained in an officer’s certificate from the Jaguar Parties, provided pursuant to Section 5. 19, and executed by an officer with the knowledge necessary to make the representations contained therein.

 

(h)                                 Required Jaguar Consents; Minimum Equity Consideration.  (i) All of the Required Jaguar Consents with respect to the Included Interests other than the Potential Kickout Interests shall have been obtained, and (ii) after taking into account any reduction in respect of Kickout Interests, at least 58.75% of the Equity Consideration to be issued in respect of the Potential Kickout Interests shall be payable at Closing.

 

(i)                                     Minimum Net Invested Capital.  Net Invested Capital shall be at least (A) $141,999,000  minus (B) the product of (i) $233,002 multiplied by (ii) the number of days from and including April 1, 2016 and through and including the earlier of (A) the Closing Date and (B) September 30, 2016.

 

Section 7.3.                                                         Conditions to Obligations of the Jaguar Parties.  The obligations of the Jaguar Parties to consummate the Transactions contemplated at the Closing are also subject to the satisfaction or waiver (in writing) by the Jaguar Representative on or prior to the Closing Date of each of the following additional conditions:

 

(a)                                 Representations and Warranties.  (i) Other than the representations and warranties set forth in Section 3.1 (Organization and Qualifications; Subsidiaries), Section 3.3 (Capital Structure), Section 3.4 (Authority), Section 3.13(b) (Taxes) and Section 3.26 (Brokers;

 

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Expenses), each of the representations and warranties of the Giants Parties set forth in this Agreement shall be true and correct (without giving effect to any qualification as to materiality or Giants Material Adverse Effect contained in Article III) as of the date of this Agreement and as of the Closing as though made on and as of the Closing (except that representations and warranties that by their terms speak specifically as of the date of this Agreement or another date shall be true and correct (without giving effect to any qualification as to materiality or Giants Material Adverse Effect contained in Article III) as of such date), except where any failures of any such representations and warranties to be true and correct would not reasonably be expected to have, individually or in the aggregate, a Giants Material Adverse Effect, and (ii) the representations and warranties set forth in Section 3.1 (Organization and Qualifications; Subsidiaries), Section 3.3 (Capital Structure), Section 3.4 (Authority), Section 3.13(b) (Taxes) and Section 3.26 (Brokers; Expenses) shall be true and correct in all material respects as of the date of this Agreement and as of the Closing Date as though made on and as of the Closing Date (except that representations and warranties that by their terms speak specifically as of the date of this Agreement or another date shall be true and correct as of such date).

 

(b)                                 Performance of Obligations of the Giants Parties.  The Giants Parties shall have performed or complied in all material respects with all obligations required to be performed or complied with by them under this Agreement at or prior to the Closing.

 

(c)                                  No Giants Material Adverse Effect.  Since the date of this Agreement, there shall have been no change, event, occurrence or circumstance that has had or would reasonably be expected to have a Giants Material Adverse Effect.

 

(d)                                 Closing of Contribution and Merger Agreements.  The closing of the transactions contemplated by the Contribution Agreements and Merger Agreements with respect to the other Jaguar Parties shall have occurred or shall occur simultaneously with the Closing, unless such failure to close is the result of a breach by a Jaguar Party.

 

(e)                                  Officer’s Certificate.  Giants shall have delivered to the Jaguar Parties a certificate, dated the date of the Closing and signed by its chief executive officer or another senior officer on behalf of Giants, certifying to the effect that the conditions set forth in Section 7.3(a), Section 7.3(b) and Section 7.3(c) have been satisfied.

 

(f)                                   Giants Party Deliverables.  The Giants Parties shall have delivered to the Jaguar Parties at the Closing the Cash Consideration, the Equity Consideration and all agreements and other items set forth in Section 2.2.

 

(g)                                  REIT Opinion.  The Jaguar Parties shall have received a written opinion of Proskauer Rose LLP, dated as of the Closing Date and in form and substance reasonably satisfactory to the Jaguar Parties, to the effect that, commencing with Giants’ taxable year that ended on December 31, 2010, Giants has been organized and operated in conformity with the requirements for qualification and taxation as a REIT under the Code and its actual method of operation has enabled Giants to meet, through the Closing Date, and its proposed method of operation will enable Giants to continue to meet, the requirements for qualification and taxation as a REIT under the Code for the tax year that includes the Closing (the “Giants REIT Opinion”), which opinion will (i) be subject to customary exceptions, assumptions and qualifications, (ii) be

 

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based on customary representations contained in officer’s certificates from the Giants Parties, provided pursuant to Section 5.18, and the Jaguar Parties, provided pursuant to Section 5.19, and executed in each case by an officer with the knowledge necessary to make the representations contained therein and (iii) rely on the opinions provided to the Giant Parties pursuant to Section 7.2(g) and (iv) expressly provide that it thereafter may be relied upon during the period after the Closing through and including the four (4) tax years of Giants following its tax year that includes the Closing by any tax counsel selected by Giants to render opinions following the Closing as to the qualification of Giants as a REIT for all periods prior to and including the Closing Date.

 

(h)                                 Giants Board Resignations.  Each current member of the Giants Board other than Randolph Read shall have delivered a Giants Board Resignation or shall have otherwise ceased to be a member of the Giants Board.

 

ARTICLE VIII

 

TERMINATION

 

Section 8.1.                                                         Termination.  This Agreement may be terminated at any time prior to the Closing, whether before or after receipt of the Giants Stockholder Approval (except as otherwise expressly noted), as follows:

 

(a)                                 by mutual written agreement of each of Giants and the Jaguar Representative; or

 

(b)                                 by either Giants or the Jaguar Parties, if:

 

(i)                                     the Closing shall not have occurred on or before January 31, 2017 (the “Outside Date”); provided, however, that the right to terminate this Agreement pursuant to this Section 8.1(b)(i) shall not be available to any Party if the failure of such Party (and (A) in the case of Giants, including the failure of any Giants Party and (B) in the case of the Jaguar Parties, including the failure of any Jaguar Party) to perform any of its obligations under this Agreement has been a principal cause of, or resulted in, the failure of the Closing to be consummated on or before such date; or

 

(ii)                                  any Governmental Entity of competent jurisdiction shall have issued a judgment, injunction, order or decree or taken any other action permanently restraining, enjoining or otherwise prohibiting the Transactions, and such judgment, injunction, order or decree or other action shall have become final and non-appealable; provided, however, that the right to terminate this Agreement under this Section 8.1(b)(ii) shall not be available to a Party if the issuance of such final, non-appealable judgment, injunction, order or decree was primarily due to the failure of such Party (and (A) in the case of Giants, including the failure of any Giants Party and (B) in the case of the Jaguar Parties, including the failure of any Jaguar Party) to perform any of its obligations under this Agreement; or

 

(iii)                               the Giants Stockholder Approval shall not have been obtained at a duly held Giants Stockholder Meeting (including any adjournment or postponement thereof); provided, however, that the right to terminate this Agreement under this

 

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Section 8.1(b)(iii) shall not be available to a Party if the failure to obtain the Giants Stockholder Approval was primarily caused by such Party (and (A) in the case of Giants, including the failure of any Giants Party or any Giants Subsidiary, and (B) in the case of the Jaguar Parties, including the failure of any Jaguar Party or any of its Affiliates) to perform any of its obligations under this Agreement; or

 

(c)                                  by Giants:

 

(i)                                     if any Jaguar Party shall have breached or failed to perform any of its representations, warranties, covenants or other agreements set forth in this Agreement, which breach or failure to perform, either individually or in the aggregate, (x) would result in a failure of a condition set forth in Section 7.1 or Section 7.2 and (y) cannot be cured on or before the Outside Date or, if curable, is not cured by the Jaguar Parties within twenty (20) Business Day of receipt by the Jaguar Parties of written notice of such breach or failure; provided that Giants shall not have the right to terminate this Agreement pursuant to this Section 8.1(c) if any Giants Party is then in breach of any of their respective representations, warranties, covenants or agreements set forth in this Agreement such that the conditions set forth in either Section 7.1 or Section 7.3 would not be satisfied; or

 

(ii)                                  pursuant to and in accordance with the terms and conditions of Section 5.7(e) in order to enter into a Superior Proposal; provided that Giants pays the Termination Fee in accordance with Section 8.3(a)(ii) in full to the Jaguar Parties (as directed in writing to Giants by the Jaguar Parties) and an agreement with respect to such Superior Proposal is entered into, and in the event that such an agreement is not substantially concurrently entered into and such payment is not substantially concurrently made, such termination shall be null and void; or

 

(iii)                               if (w) all of the conditions to the Closing set forth in Section 7.1 and Section 7.3 have been satisfied or (to the extent permitted by Law) waived (other than those conditions that by their terms are to be satisfied at the Closing, each of which is capable of being satisfied at such time), (x) any Jaguar Party fails to complete the Closing on the date the Closing should have occurred pursuant to Section 2.1, (y) Giants shall have delivered a written notice to the Jaguar Parties certifying that all conditions set forth in Article VII have been satisfied (or would be satisfied if the Closing were to occur on the date of such notice) or (to the extent permitted by Law) waived by the party entitled to the benefit of such condition, and the Giants Parties stand ready, willing and able to effect the Closing at such time and (z) any Jaguar Party fails to effect the Closing by the third (3rd) Business Day after the delivery of such notification described in clause (y).

 

(d)                                 by the Jaguar Parties:

 

(i)                                     if any Giants Party shall have breached or failed to perform  any of its representations, warranties, covenants or other agreements set forth in this Agreement, which breach or failure to perform, either individually or in the aggregate, (x) would result in a failure of a condition set forth in Section 7.1 or Section 7.3 and (y) cannot be

 

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cured on or before the Outside Date or, if curable, is not cured by the Giants Parties within twenty (20) Business Days of receipt by the Giants Parties of written notice of such breach or failure; provided that the Jaguar Parties shall not have the right to terminate this Agreement pursuant to this Section 8.1(d)(i) if any Jaguar Party is then in breach of any of its respective representations, warranties, covenants or agreements set forth in this Agreement such that the conditions set forth in either Section 7.1 or Section 7.2 would not be satisfied; or

 

(ii)                                  prior to receipt of the Giants Stockholder Approval, if the Giants Board makes an Adverse Recommendation Change; provided that the Jaguar Parties’ right to terminate this Agreement pursuant to this Section 8.1(d)(ii) shall expire at 5:00 p.m. (New York City time) on the twentieth (20th) day following the date on which the event first permitting such termination occurred; or

 

(iii)                               if (w) all of the conditions to the Closing set forth in Section 7.1 and Section 7.2 have been satisfied or (to the extent permitted by Law) waived (other than those conditions that by their terms are to be satisfied at the Closing, each of which is capable of being satisfied at such time), (x) any Giants Party fails to complete the Closing on the date the Closing should have occurred pursuant to Section 2.1, (y) Jaguar shall have delivered a written notice to the Giants Parties certifying that all conditions set forth in Article VII have been satisfied (or would be satisfied if the Closing were to occur on the date of such notice) or (to the extent permitted by Law) waived by the party entitled to the benefit of such condition, and the Jaguar Parties stand ready, willing and able to effect the Closing at such time and (z) any Giants Party fails to effect the Closing by the third (3rd) Business Day after the delivery of such notification described in clause (y).

 

Section 8.2.                                                         Effect of Termination.  In the event that this Agreement is terminated and the Closing and the other Transactions are abandoned pursuant to Section 8.1, written notice thereof shall be given to the other party or parties, specifying the provisions hereof pursuant to which such termination is made and describing the basis therefor in reasonable detail, and this Agreement shall forthwith become null and void and of no further force or effect whatsoever without liability on the part of any party hereto (or any of the Giants Subsidiaries, Jaguar Parties’ Subsidiaries or any of Giants Parties’ or the Jaguar Parties’ respective Representatives), and all rights and obligations of any party hereto shall cease; provided, however, that, notwithstanding anything in the foregoing to the contrary (a) no such termination shall relieve any party hereto of any liability or damages resulting from or arising out of any fraud or willful or intentional material breach of this Agreement prior to such termination of this Agreement, in which case the aggrieved party shall be entitled to all rights and remedies available at law or in equity; and (b) the Confidentiality Agreement, this Section 8.2, Section 8.3, Section 9.4, Article IX and the definitions of all defined terms appearing in such sections shall survive any termination of this Agreement pursuant to Section 8.1 for twelve (12) months.  For avoidance of doubt, and without limiting the foregoing, any failure of the Giants Parties or the Jaguar Parties (as applicable) to effect the Closing as required by Section 2.1 shall be a willful and intentional material breach of this Agreement by such parties.  If this Agreement is terminated as provided herein, all filings, applications and other submissions made pursuant to this Agreement, to the extent practicable, shall be withdrawn from the Governmental Entity or other Person to which they were made.

 

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Section 8.3.                                                         Termination Fee; Expense Reimbursement.

 

(a)                                 If, but only if, the Agreement is terminated:

 

(i)                                     by either Giants or the Jaguar Parties pursuant to Section 8.1(b)(iii), or by the Jaguar Parties pursuant to Section 8.1(d)(i), and, in any such case, (x) the Giants Board receives or has received a Takeover Proposal after the date of this Agreement, which proposal has not been subsequently withdrawn (and with respect to a termination pursuant to Section 8.1(b)(iii), which proposal has been publicly announced) and (y) within twelve (12) months of the termination of this Agreement, Giants or any of the Giants Subsidiaries enters into a transaction regarding, or executes a definitive agreement with respect to any Takeover Proposal, then Giants shall pay, or cause to be paid, to the Jaguar Parties a fee equal to $55,000,000 (the “Termination Fee”), less, if previously paid, the Expense Amount, by wire transfer of same day funds to an account or accounts designated by the Jaguar Parties, not later than two (2) Business Days following the execution of such definitive agreement; provided, however, that for purposes of this Section 8.3(a)(i), the references to “20%” in the definition of Takeover Proposal shall be deemed to be references to “50%”; or

 

(ii)                                  by Giants pursuant to Section 8.1(c)(ii) or the Jaguar Parties pursuant to Section 8.1(d)(ii), as applicable, then Giants shall pay, or cause to be paid, to the Jaguar Parties the Termination Fee by wire transfer of same day funds to an account or accounts designated by the Jaguar Parties, not later than two (2) Business Days following such termination; or

 

(iii)                               by either Giants or the Jaguar Parties pursuant to Section 8.1(b)(iii), then Giants shall reimburse the Jaguar Parties for its actual reasonable out-of-pocket Expenses up to a maximum amount of $10,000,000 (the “Expense Amount”) by wire transfer of same day funds to an account or accounts designated by the Jaguar Parties within thirty (30) days after receipt by Giants of written notice of demand for payment and a documented itemization setting forth in reasonable detail all such Expenses of the Jaguar Parties; or

 

(iv)                              by Giants pursuant to Section 8.1(b)(i), if as of the Outside Date the conditions set forth in Section 7.2(h) have not been satisfied, then the Jaguar Parties shall reimburse the Giants Parties for their reasonable out-of-pocket Expenses up to the Expense Amount by wire transfer of same day funds to an account or accounts designated by the Giants Parties within thirty (30) days after receipt by the Jaguar Representative of written notice of demand for payment and a documented itemization setting forth in reasonable detail all such Expenses of the Giants Parties.

 

(b)                                 Notwithstanding anything to the contrary set forth in this Agreement, the Parties agree that:

 

(i)                                     under no circumstances shall Giants be required to pay the Termination Fee or Expense Amount (x) earlier than one (1) full Business Day after

 

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receipt of appropriate wire transfer instructions from the Jaguar Parties or (y) on more than one occasion; and

 

(ii)                                  under no circumstances shall the Jaguar Parties be required to pay the Expense Amount (x) earlier than one (1) full Business Day after receipt of appropriate wire transfer instructions from Giants or (y) on more than one occasion.

 

(c)                                  Each of the Parties acknowledges that (i) the agreements contained in this Section 8.3 are an integral part of the Transactions, (ii) the Termination Fee and Expense Amount payable to the Jaguar Parties and the Expense Amount payable to the Giants Parties are not penalties, but are liquidated damages, in a reasonable amount that will compensate the Jaguar Parties or the Giants Parties, as applicable, in the circumstances in which such amounts are payable for the efforts and resources expended and opportunities foregone while negotiating this Agreement and in reliance on this Agreement and on the expectation of the consummation of the Transactions, which amounts would otherwise be impossible to calculate with precision, and (iii) without these agreements, the parties would not enter into this Agreement; accordingly, if any Party fails to timely pay any amount due pursuant to this Section 8.3 and, in order to obtain such payment, the Party entitled to such payment commences a suit that results in a judgment against the other Party for the payment of any amount set forth in this Section 8.3, the Party against whom such judgment was rendered shall pay the Party entitled to such payment its costs and expenses in connection with such suit, together with interest on such amount at the rate of eight percent (8%) per annum for the period from the date such payment was required to be made through the date such payment was actually received, or such lesser rate as is the maximum permitted by applicable Law.

 

(d)                                 Upon termination of this Agreement in accordance with its terms, in the event the Jaguar Parties are entitled to receive the Termination Fee or Expense Amount pursuant to Section 8.3(a)(i iii), the receipt by the Jaguar Parties of such Termination Fee or Expense Amount shall be the sole and exclusive remedy of the Jaguar Parties and their respective Affiliates against the Giants Parties and their former, current or future stockholders, directors, officers, Affiliates, agents or other Representatives for any loss suffered as a result of any breach of any representation, warranty, covenant or agreement in this Agreement or the failure of the Closing or the other Transactions to be consummated, and upon payment of such Termination Fee or Expense Amount, neither the Giants Parties nor any of their former, current or future stockholders, directors, officers, Affiliates, agents or other Representatives shall have any further liability or obligation relating to or arising out of this Agreement or the Closing or the other Transactions; provided that, nothing in this Section 8.3(d) shall relieve any Person from any liabilities or damages resulting from or arising out of any fraud or willful or intentional material breach of this Agreement prior to or in connection with such termination in which case the Jaguar Parties shall be entitled to all the rights and remedies available at Law or in equity.

 

(e)                                  (i) If the Jaguar Parties are required to make a payment to the Giants Parties pursuant to Section 8.3(a)(iv) (the “Giants Expense Reimbursement”) such Giants Expense Reimbursement shall be paid into escrow on the date such payment is required to be paid by the Jaguar Parties pursuant to this Agreement by wire transfer of immediately available funds to an escrow account designated in accordance with this Section 8.3(e).  In the event that the Jaguar Parties are obligated to pay the Giants Parties the Giants Expense Reimbursement, the

 

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amount payable to the Giants Parties in any tax year of Giants shall not exceed the lesser of (i) the Giants Expense Reimbursement payable to the Giants Parties, and (ii) the sum of (A) the maximum amount that can be paid to the Giants Parties without causing Giants to fail to meet the requirements of Section 856(c)(2) and (3) of the Code for the relevant tax year, determined as if the payment of such amount did not constitute income described in Sections 856(c)(2) or 856(c)(3) of the Code (“Qualifying Income”) and Giants has $1,000,000 of income from unknown sources during such year which is not Qualifying Income (in addition to any known or anticipated income which is not Qualifying Income), in each case, as determined by Giants Parties’ independent accountants, plus (B) in the event the Giants Parties receive either (x) a letter from the Giants Parties’ counsel indicating that the Giants Parties has received a ruling from the IRS as described below in this Section 8.3(e) or (y) an opinion from the Giants Parties’ outside counsel as described below in this Section 8.3(e), an amount equal to the excess of the Giants Expense Reimbursement less the amount payable under clause (A) above.

 

(ii)                                  To secure the Jaguar Parties’ obligation to pay these amounts, the Jaguar Parties shall deposit into escrow an amount in cash equal to the Giants Expense Reimbursement with an escrow agent selected by the Jaguar Parties on such terms (subject to this Section 8.3(e)) as shall be mutually agreed upon by the Jaguar Parties, the Giants Parties and the escrow agent.  The payment or deposit into escrow of the Giants Expense Reimbursement pursuant to this Section 8.3(e) shall be made at the time the Jaguar Parties are obligated to pay the Giants Parties such amount pursuant to Section 8.3 by wire transfer.  The escrow agreement shall provide that the Giants Expense Reimbursement in escrow or any portion thereof shall not be released to the Giants Parties unless the escrow agent receives any one or combination of the following:  (A) a letter from the Giants Parties’ independent accountants indicating the maximum amount that can be paid by the escrow agent to the Giants Parties without causing Giants to fail to meet the requirements of Sections 856(c)(2) and (3) of the Code determined as if the payment of such amount did not constitute Qualifying Income and Giants has $1,000,000 of income from unknown sources during such year which is not Qualifying Income (in addition to any known or anticipated income which is not Qualifying Income), in which case the escrow agent shall release such amount to the Giants Parties, or (B) a letter from the Giants Parties’ counsel indicating that (x) the Giants Parties received a ruling from the IRS holding that the receipt by the Giants Parties of the Giants Expense Reimbursement would either constitute Qualifying Income or would be excluded from gross income within the meaning of Sections 856(c)(2) and (3) of the Code or (y) the Giants Parties’ outside counsel has rendered a legal opinion to the effect that the receipt by the Giants Parties of the Giants Expense Reimbursement should either constitute Qualifying Income or should be excluded from gross income within the meaning of Sections 856(c)(2) and (3) of the Code, in which case the escrow agent shall release the remainder of the Giants Expense Reimbursement to the Giants Parties.  The Jaguar Parties agree to amend this Section 8.3(e) at the reasonable request of the Giants Parties in order to (1) maximize the portion of the Giants Expense Reimbursement that may be distributed to the Giants Parties hereunder without causing the Giants Parties to fail to meet the requirements of Sections 856(c)(2) and (3) of the Code, or (2) assist the Giants Parties in obtaining a favorable ruling or legal opinion from its outside counsel, in each case, as described in this Section 8.3(e).  Any amount of the Giants Expense Reimbursement that remains unpaid as of the end of a taxable year shall be paid as soon

 

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as possible during the following taxable year, subject to the foregoing limitations of this Section 8.3(e).

 

(f)                                   Upon termination of this Agreement in accordance with its terms, in the event the Giants Parties are entitled to receive the Expense Amount pursuant to Section 8.3(a)(iv), the receipt by the Giants Parties of such Expense Amount shall be the sole and exclusive remedy of the Giants Parties and their respective Affiliates against the Jaguar Parties and their former, current or future stockholders, directors, officers, Affiliates, agents or other Representatives for any loss suffered as a result of any breach of any representation, warranty, covenant or agreement in this Agreement or the failure of the Closing or the other Transactions to be consummated, and upon payment of such Expense Amount, neither the Jaguar Parties nor any of their former, current or future stockholders, directors, officers, Affiliates, agents or other Representatives shall have any further liability or obligation relating to or arising out of this Agreement or the Closing or the other Transactions; provided that, nothing in this Section 8.3(f) shall relieve any Person from any liabilities or damages resulting from or arising out of any fraud or willful or intentional material breach of this Agreement prior to or in connection with such termination in which case the Giants Parties shall be entitled to all the rights and remedies available at Law or in equity.

 

ARTICLE IX

 

MISCELLANEOUS

 

Section 9.1.                                                         Amendment.  Subject to compliance with applicable Law, this Agreement may be amended by mutual agreement of the Parties hereto by action taken or authorized by their respective boards of directors, general partners or other similar governing body or entity at any time before or after receipt of the Giants Stockholder Approval and prior to the Closing; provided, however, that after the Giants Stockholder Approval has been obtained, there shall not be (a) any amendment of this Agreement that changes the amount or the form of the Consideration to be delivered under this Agreement to the Jaguar Parties, or which by applicable Law or in accordance with the rules of any stock exchange requires the further approval of the stockholders of Giants without such further approval of such stockholders, or (b) any amendment or change not permitted under applicable Law.  This Agreement may not be amended except by an instrument in writing signed by each of the Parties hereto.

 

Section 9.2.                                                         Waiver.  At any time prior to the Closing, subject to applicable Law, any Party hereto may (a) extend the time for the performance of any obligation or other act of any other Party hereto, (b) waive any inaccuracy in the representations and warranties of the other Party contained herein or in any document delivered pursuant hereto, and (c) subject to the proviso of Section 9.1, waive compliance with any agreement or condition contained herein.  Any agreement on the part of a Party hereto to any such extension or waiver shall be valid only if set forth in an instrument in writing signed by the Party or Parties to be bound thereby.  Notwithstanding the foregoing, no failure or delay by any Party hereto in exercising any right hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise of any other right hereunder.

 

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Section 9.3.                                                         Non-Survival.  None of the representations, warranties, pre-Closing covenants or agreements in this Agreement or in any schedule, instrument or other document delivered pursuant to this Agreement shall survive the Closing; provided, however, that this Section 9.3 shall not limit any covenant or agreement of the Parties to the extent such covenant or agreement by its terms contemplates performance after the Closing, which shall survive the Closing.

 

Section 9.4.                                                         Expenses.  Except as may be otherwise expressly contemplated herein, all Expenses incurred in connection with this Agreement and the Transactions shall be paid by the Party incurring such Expenses in the event the Closing does not occur.  In the event that the Closing occurs, Giants shall pay all bona fide third party Expenses (which, for the avoidance of doubt, shall not include any expenses incurred by the Jaguar Parties or their Affiliates solely in connection with the Proposed Jaguar IPO) incurred by the Parties in connection with this Agreement, the Restructuring Transactions and the other Transactions (and shall reimburse the Jaguar Parties for any such Expenses previously paid by them), other than Excluded Expenses.  At the Closing, the Jaguar Parties (other than any Jaguar Management Entity, Included Entity or any of their respective Subsidiaries) shall pay any Excluded Expenses.

 

Section 9.5.                                                         Notices.  All notices, requests, demands, claims and other communications which are required or may be given under this Agreement shall be in writing and shall be deemed to have been duly given (i) when received if delivered personally; (ii) when transmitted if transmitted by e-mail of a pdf attachment and the hard copy is sent by the next Business Day by reliable overnight delivery service (with proof of service) or hand delivery); and (iii) the Business Day after it is sent, if sent for next day delivery by reliable overnight delivery service (with proof of service), hand delivery or certified or registered mail (return receipt requested and first-class postage prepaid), addressed as follows (or at such other address for a Party as shall be specified in a notice given in accordance with this Section 9.5):

 

if to the Giants Parties, to:

 

New York REIT, Inc.

405 Park Avenue

New York, New York

Attention:

Chief Executive Officer

E-mail:

mhappel@nyrt.com

 

with copies to (which shall not constitute notice):

 

New York REIT, Inc.

405 Park Avenue

New York, New York

Attention:

Legal Department

E-mail:

mead@nyrt.com

 

 

Proskauer Rose LLP

Eleven Times Square

 

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New York, New York 10036

Phone:

(212) 969-3000

Facsimile:

(212) 969-2900

Attention:

Steven L. Lichtenfeld, Esq.

E-mail:

slichtenfeld@proskauer.com

 

if to the Jaguar Parties, to:

 

JBG Properties Inc.

4445 Willard Avenue, Suite 400

Chevy Chase, Maryland 20815

Attention:

W. Matthew Kelly

E-mail:

mkelly@jbg.com

 

with copies to (which shall not constitute notice):

 

Hogan Lovells US LLP

Columbia Square

555 Thirteenth Street, NW

Washington, District of Columbia 20004

Phone:

(202) 637-5868

Facsimile:

(202) 637-5910

Attention:

David W. Bonser, Esq.

E-mail:

david.bonser@hoganlovells.com

 

Section 9.6.                                                         Certain Definitions.  For the purposes of this Agreement, the term:

 

Acceptable Confidentiality Agreement” means a confidentiality agreement that contains terms that are no less favorable in the aggregate to Giants than those contained in the Confidentiality Agreement; provided, however, that an Acceptable Confidentiality Agreement shall not be required to contain standstill provisions; and provided, further, that an Acceptable Confidentiality Agreement shall not contain any provision that would prevent Giants from complying with its obligations to provide any disclosure to Jaguar Parties or their Representatives pursuant to Section 5.7.

 

Affiliate” of any Person means any other Person directly or indirectly controlling or controlled by or under common control with such Person.  For the purposes of this definition, “control”, when used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

 

Ancillary Documents” means the Contribution Agreements, the Merger Agreements, Registration Rights Agreements, the Partnership Agreement Amendment and Restatement and each other document or instrument contemplated hereby to be executed and delivered by any of the Parties at the Closing.

 

Atlantic REIT” means JBG/Atlantic REIT, L.L.C.

 

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Business Day” means any day that is not a Saturday, Sunday or other day on which banking institutions in New York City or Washington D.C. are authorized or required by Law to close.

 

Class B Units” means a partnership unit designated by the Operating Partnership as a Class B Unit under the Partnership Agreement.

 

Closing Date Payments” means the payment in full, in cash, of the Mandatory Uses.

 

Code” means the Internal Revenue Code of 1986, as amended.

 

Confidentiality Agreement” means the Confidentiality Agreement, dated January 29, 2016, between New York REIT, Inc. and JBG Properties, as amended to date.

 

Contract” means any agreement, contract, instrument, commitment, lease, guaranty, indenture, license, or other arrangement or understanding (and all amendments, side letters, modifications and supplements thereto) between parties or by one party in favor of another party, whether written or oral, but excluding any Giants Leases, Jaguar Leases and any ground lease  affecting a Jaguar Included Property.

 

Core REITs” means 151 Q Street REIT, L.L.C., Fairways Residential REIT, L.L.C., JBG/Foundry Office REIT, L.L.C., JBG/Pickett Office REIT, L.L.C., and JBG/Woodbridge REIT, L.L.C.

 

Credit Facility” means the debt financing incurred or intended to be incurred pursuant to Section 5.8 in the principal amount equal to the Credit Facility Amount plus such additional amount as shall be determined by the Jaguar Parties and approved by the Giants Parties, such approval not to be unreasonably withheld.

 

Credit Facility Amount” means an amount equal to no less than (i) the full amount required to fulfill the payment of the Mandatory Uses (less any Mandatory Uses paid at Closing through sources other than the Credit Facility) in full plus (ii) $50,000,000.

 

Credit Facility Conditions” means the conditions precedent to the funding of the Credit Facility under the credit agreement entered into in connection therewith.

 

Credit Facility Documents” means the agreements, documents and certificates required to be entered into in connection with the Credit Facility, including (a) credit agreements, promissory notes, guarantees, loan documents and other instruments or agreements; (b) any certificates, opinions, corporate organizational documents, good standing certificates, lien searches, and/or resolutions contemplated by the Credit Facility; and (c) all documentation and other information required by the lenders in connection with the Credit Facility.

 

Credit Facility Information” means all information with respect to the Jaguar Included Properties or Giants Properties, as applicable, as may be reasonably requested by the Giants Parties or Jaguar Parties or their potential Financing Sources in connection with obtaining the Credit Facility or otherwise as may be reasonably required to be delivered to satisfy a Credit Facility Condition.

 

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Debt Maintenance Agreement” means that Debt Maintenance Agreement by and among Giants, the Operating Partnership and each protected partner identified as a signatory on a schedule thereto substantially in form attached hereto as Exhibit H which allows for debt of the Operating Partnership to be guaranteed by certain Persons who become partners of the Operating Partnership as a result of the Transactions and who were partners or members of the Jaguar Funds which own an interest in Jaguar Included Property known as “DOT”.

 

Designated Pipeline Properties” means the real property interests described in Section 9.6 of the Jaguar Disclosure Letter.

 

Distributions” means, during the applicable period, any of the following:  (i) the declaration or payment of any dividend or any other distribution in respect of the partnership, membership or other ownership interests or any payment made to the direct or indirect holders (in their capacities as such) of the partnership, limited liability company or other entity, or (ii) the purchase, redemption or other acquisition or retirement for value by of any Equity Interest in such entity.

 

Environmental Law” means any and all applicable Laws which (i) regulate or relate to the protection or clean-up of the environment; the use, treatment, storage, transportation, handling, disposal or release of Hazardous Substances, the preservation or protection of waterways, groundwater, drinking water, air, wildlife, plants or other natural resources; or the health and safety of persons or property, including protection of the health and safety of employees, with respect to exposure to Hazardous Substances; or (ii) impose liability or responsibility with respect to any of the foregoing, including the Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. § 9601 et seq.), or any other Law of similar effect.

 

Environmental Permits” means any material permit, license, authorization or approval required under applicable Environmental Laws.

 

Equity Interest” means, with respect to any entity, any share, capital stock, partnership, member or similar interest in such entity, and any option, warrant, right or security (including debt securities) convertible, exchangeable or exercisable therefor.

 

ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and all regulations, rules and other guidance promulgated thereunder.

 

ERISA Affiliate” means any Person (whether or not incorporated) which is (or at any relevant time was) a member of a “controlled group of corporations” with, under “common control” with, or a member of an “affiliated service group” with, any Party as defined in Section 414(b), (c), (m) or (o) of the Code.

 

Exchange Act” means the Securities Exchange Act of 1934, as amended, and all regulations, rules and other guidance promulgated thereunder.

 

Excluded Expenses” means the amount by which the total amount (without duplication) of Jaguar Consent Expenses is greater than $15,000,000.

 

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Expenses” means all reasonable out-of-pocket expenses (including all fees and expenses of counsel, accountants, investment bankers, experts and consultants to a Party and its affiliates) incurred by a Party or on its behalf in connection with or related to the authorization, preparation, negotiation, execution and performance of this Agreement, the preparation, printing, filing and mailing of the Proxy Statement, the solicitation of stockholder and stockholder approvals, the filing of any required notices under the HSR Act or other similar regulations, any filings with the SEC and all other matters related to the consummation of the Transactions, including debt assumption costs and expenses and Transfer Taxes.

 

Failed Loan Assumption” means the rejection by a lender or servicer (acting on behalf of a lender) to consent to the direct or indirect transfer of a Jaguar Included Property to a Giants Party or a Subsidiary thereof.

 

Financing Sources” means the entities that provide or arrange or otherwise have entered into agreements in connection with all or any part of the Credit Facility in connection with the Transactions, together with their respective Affiliates, and their respective Affiliates’ officers, directors, employees, agents and representatives and their respective successors and assigns.

 

Giants Advisory Agreement” shall mean the Seventh Amended and Restated Advisory Agreement dated June 26, 2015, between Giants, the Operating Partnership and Giants Advisor, as amended, modified or supplemented through the date hereof.

 

Giants Benefit Plan” means each Plan which is sponsored, maintained or contributed to, or required to be sponsored, maintained or contributed to, by Giants or any Giants Subsidiary, or under which Giants or any Giants Subsidiary has any obligation or liability to provide compensation or benefits to or for the benefit of any current or former employee, or the spouses, beneficiaries or other dependents thereof.

 

Giants Lease” means each lease or sublease or license or agreement to occupy space with respect to each of the applicable Giants Properties and to which Giants or any Giants Subsidiary is a party as lessor or sublessor or licensor, together with all amendments, modifications, renewals and extensions exercised related thereto.

 

Giants Marketed Properties” means (i) the leasehold interest at 120 W. 57th Street and operated as “The Viceroy Central Park,” and (ii) the fee interest in the property located at 1100 Kings Highway.

 

Giants Material Adverse Effect” means any effect, change, event or occurrence that, individually or in the aggregate, has had, or would reasonably be expected to have, a material adverse effect on the business, properties, assets, liabilities, results of operations or financial condition of Giants and the Giants Subsidiaries, taken as a whole; provided, however, that no effect, change, event or occurrence resulting or arising from the following shall be deemed to constitute a Giants Material Adverse Effect or shall be taken into account when determining whether a Giants Material Adverse Effect has occurred or is reasonably likely to exist or occur:  (i) any changes in general United States or global political, regulatory or economic conditions, or the capital, financial or securities markets, including changes in interest rates, to the extent that such changes do not disproportionately have a greater adverse impact on the Giants and the

 

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Giants Subsidiaries, taken as a whole, relative to other similarly situated participants in the industries in which Giants and the Giants Subsidiaries operate generally, (ii) any changes generally affecting the industries or markets in which Giants and the Giants Subsidiaries operate to the extent that such changes do not disproportionately have a greater adverse impact on Giants and the Giants Subsidiaries, taken as a whole, relative to other similarly situated participants in the industries in which Giants and the Giants Subsidiaries operate generally, (iii) any changes after the date hereof in GAAP (or any interpretation thereof in accordance with the Financial Accounting Standards Board Statements of Financial Accounting Standards and Interpretations), (iv) any adoption, implementation, promulgation, repeal, modification, amendment, reinterpretation, change or proposal of any applicable Law of or by any Governmental Entity after the date hereof to the extent that such adoption, implementation, promulgation, repeal, modification, amendment, reinterpretation, change or proposal does not disproportionately have a greater adverse impact on Giants and the Giants Subsidiaries, taken as a whole, relative to other similarly situated participants in the industries in which Giants and the Giants Subsidiaries operate generally, (v) any actions taken, or the failure to take any action, if such action or such failure to take action is at the written request or with the prior written consent of the Jaguar Parties, (vi) any effect, change, event or occurrence attributable to the negotiation, execution, announcement or other public disclosure or performance of this Agreement and the Transactions or the impact of such negotiation, execution, announcement, disclosure or performance on relationships, contractual or otherwise, with customers, suppliers, tenants, lenders, employees, unions, licensors, joint venture partners or other Persons with business relationships with Giants or any Giants Subsidiary, or any action by a Governmental Entity or any Action or dispute brought or threatened arising out of or relating from such negotiation, execution, announcement, disclosure or performance (provided that this clause (vi) shall not apply with respect to Section 3.5 of this Agreement), (vii) any failure by Giants to meet any internal or published projections, estimates or expectations of Giants’ revenue, earnings or other financial performance or results of operations for any period, in and of itself, or any failure by Giants to meet its internal budgets, plans or forecasts of its revenues, earnings or other financial performance or results of operations, in and of itself (it being understood that the facts or occurrences giving rise or contributing to such failure that are not otherwise excluded from the definition of a “Giants Material Adverse Effect” may be taken into account, unless such fact or occurrence is otherwise excluded from this definition), (viii) any effect, change, event or occurrence after the date hereof arising out of changes in geopolitical conditions, acts of terrorism, civil disobedience or sabotage, the commencement, continuation or escalation of a war, acts of armed hostility, weather conditions or other force majeure events, including any material worsening of such conditions threatened or existing as of the date of this Agreement to the extent that such changes do not disproportionately have a greater adverse impact on Giants and the Giants Subsidiaries, taken as a whole, relative to other similarly situated participants in the industries in which Giants and the Giants Subsidiaries operate generally; and (ix) the matters set forth on Section 9.6(a) of the Giants Disclosure Letter.

 

Giants Parties Credit Agreement” means that certain Second Amended and Restated Credit Agreement dated April 14, 2014, by and among New York Recovery Operating Partnership, LP, New York REIT, Inc. and Capital One, National Association.

 

Giants Permitted Liens” means all of the following:  (i) the Giants Leases and the ground leases affecting any of the Giants Properties as of the date hereof, or amendments or

 

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modifications to the foregoing, entered into after the date hereof in accordance with the terms of this Agreement, (ii) Liens for current real estate taxes and special assessments which are not yet due and payable (subject to apportionment in accordance with the terms hereof), (iii) subject to the adjustments provided for herein and to the extent due after Closing, any charges for service, installation, connection, maintenance, sewer, water, electricity, telephone, cable television or gas, (iv) rights of vendors and holders of security interests on personal property installed at any Giants Property by tenants under Giants Leases in effect on the date hereof or entered into after the date hereof in accordance with the terms of this Agreement, (v) to the extent permitted under the Giants Leases in effect on the date hereof or entered into after the date hereof in accordance with the terms of this Agreement, rights of tenants to remove fixtures at the expiration of the term of the Giants Leases of such tenants, (vi) mechanics liens arising by or through the tenants under any Giants Leases affecting Giants Properties or personal property of Giants or any Giants Subsidiary, (vii) any exceptions created by the ground lessor pursuant to any ground lease of which Giants is ground lessee affecting any of the Giants Properties on the fee interest of the relevant property, (viii) Laws, regulations, resolutions or ordinances, including, without limitation, building, zoning and environmental protection, as to the use, occupancy, subdivision, development, conversion or redevelopment of any Giants Property currently or hereinafter imposed by any governmental or quasi-governmental body or authority; (ix) Liens relating to Indebtedness that is disclosed in Section 3.14(a)(vi) of the Giants Disclosure Letter, (x) any other non-monetary Liens, limitations, restrictions or title defects first arising from and after the date of this Agreement in the ordinary course of operation of the applicable Included Asset that do not have a Giants Material Adverse Effect on the applicable Giants Property of personal property of Giants or any Giants Subsidiary; and (xi) the matters set forth in any of the Giants Title Policies.

 

Giants Restricted Stock” means any shares of Giants Common Stock that were granted pursuant to the Giants Stock Plans and are subject to restrictions on transfer and/or forfeiture.

 

Giants Shares” means shares of Giants Common Stock.

 

Giants Stock Plans” means Giants’ 2010 Stock Option Plan and Giants’ Employee and Director Incentive Restricted Share Plan, as amended.

 

Giants Stockholder Approval” means the affirmative vote of a majority of votes cast by the holders of Giants Common Stock at the Giants Stockholder Meeting on the Equity Issuance.

 

Giants Stockholder Meeting” means a meeting of the holders of shares of Giants Common Stock convened for the purpose of seeking the Giants Stockholder Approval, including any postponement or adjournment thereof.

 

Governing Documents” means (a) the articles or certificate of formation or incorporation, all certificates of determination and designation, and the bylaws of a corporation; (b) the partnership agreement and any statement of partnership of a general partnership; (c) the limited partnership agreement and the certificate or articles of limited partnership of a limited partnership; (d) the operating agreement, limited liability company agreement and the certificate or articles of organization or formation of a limited liability company; (e) any charter or similar document adopted or filed in connection with the creation, formation or organization of any other Person; and (f) any amendment to any of the foregoing.

 

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Hazardous Substances” means any pollutant, chemical, substance and any toxic, infectious, carcinogenic, reactive, corrosive, ignitable or flammable chemical, or chemical compound, or hazardous substance, material or waste, whether solid, liquid or gas, that is subject to regulation, control or remediation under any Environmental Laws, including any quantity of asbestos, urea formaldehyde, polychlorinated biphenyls (PCBs), radon gas, and petroleum products or by-products.

 

Included Assets” means, in addition to the Included Interests, all assets, liabilities and properties of the Jaguar Funds and their Subsidiaries related to the Designated Pipeline Properties, the Jaguar Included Properties and Included Interests or the proceeds from any sale thereof.

 

Indebtedness” means with respect to any Person, (i) all indebtedness, notes payable, accrued interest payable or other obligations for borrowed money, whether secured or unsecured, (ii) all indebtedness evidenced by a note, bond, debenture or other similar instrument or debt security, (iii) all obligations under conditional sale or other title retention agreements, or incurred as financing, in either case with respect to property acquired by such Person, (iv) all obligations issued, undertaken or assumed as the deferred purchase price for any property or assets, (v) all obligations under capital leases, (vi) all obligations in respect of bankers acceptances or letters of credit, (vii) all obligations under interest rate cap, swap, collar or similar transaction or currency hedging transactions, and (viii) any guarantee (other than customary non-recourse carve-out or “badboy” guarantees) of any of the foregoing, whether or not evidenced by a note, mortgage, bond, indenture or similar instrument.

 

Indemnitee” means Giants Advisor and its Affiliates and any individual who, on or prior to the Closing, was an officer, director, partner, manager or service provider of Giants or Giants Advisor or its Affiliates or served on behalf of Giants as an officer, director, service provider, partner, manager, member or trustee of any of the Giants Subsidiaries.

 

Intellectual Property” means all United States and foreign (i) patents, patent applications, invention disclosures, and all related continuations, continuations-in-part, divisionals, reissues, re-examinations, substitutions and extensions thereof, (ii) trademarks, service marks, trade dress, logos, trade names, corporate names, internet domain names, design rights and other source identifiers, together with the goodwill symbolized by any of the foregoing, (iii) copyrightable works and copyrights, (iv) confidential and proprietary information, including trade secrets, know-how, ideas, formulae, models and methodologies, (v) all rights in the foregoing and in other similar intangible assets, and (vi) all applications and registrations for the foregoing.

 

Interest Payments” means, during the applicable period, all interest payments, including the net cash costs or benefits under all interest rate protection agreements related to the applicable Indebtedness, made in accordance with the loan documents evidencing Indebtedness for borrowed money, excluding any interest payments that would be capitalized under GAAP.

 

Investment Company Act” means the Investment Company Act of 1940, as amended.

 

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Jaguar Benefit Plan” means each Plan which is sponsored, maintained or contributed to, or required to be sponsored, maintained or contributed to, by any Jaguar Party or any of its Subsidiaries under which any Jaguar Party or any such Subsidiary has any obligation or liability to provide compensation or benefits to or for the benefit of any current or former Jaguar Employee, or the spouses, beneficiaries or other dependents thereof.

 

Jaguar Consent Expenses” means (i) any assumption, consent or transfer fees owed or otherwise charged by the applicable counterparty (or its servicer or representative) in connection with obtaining any Required Jaguar Consents, (ii) all refinancing costs and expenses (including, without limitation, brokerage fees, origination fees, title insurance premiums and other costs incurred or reimbursed to a lender) relating to any refinanced Indebtedness in respect of any Jaguar Included Properties as a result of a Failed Loan Assumption or otherwise, (iii) all prepayment premiums and penalties and “make-wholes” that result from the refinancing of any Indebtedness in respect of any Jaguar Included Property as a result of a Failed Loan Assumption or otherwise, (iv) all costs to provide replacement collateral required to defease any Indebtedness in respect of any Jaguar Included Property as a result of a Failed Loan Assumption or otherwise, (v) all processing fees charged by a lender or a servicer in order to submit application packages relating to the assumption of any Indebtedness in respect of any Jaguar Included Property, (vi) all applicable mortgage taxes, intangible taxes, documentary stamp taxes and recordation charges relating to any assumption of any Indebtedness in respect of a Jaguar Included Property or a refinancing thereof, (vii) any third party, out-of-pocket costs and expenses, including attorneys’ fees and expenses charged by a lender in connection with the assumption of any Indebtedness relating to a Jaguar Included Property or the refinancing thereof, and (viii) any third party, out-of-pocket costs and expenses, including attorneys’ fees and expenses charged by a landlord or a joint venture partner in connection with the consideration of, and/or the documentation of, any Required Jaguar Ground Lessor Consent or Required Jaguar JV Consent (as applicable).

 

Jaguar Corporate Entities” means Fund VII REIT, Fund VIII REIT, Fund IX REIT, Atlantic REIT, the Core REITs, 51 N 50 Patterson Corporate Member, L.L.C., JBG/Landbay G Corporate Member, L.L.C., Upper Rock District Association, Inc., the Jaguar TRSs and Jaguar Properties.

 

Jaguar Data Room” means the materials made available to the Giants Parties by the Jaguar Parties before 11:59 p.m. on May 25, 2016 on the Project Giants online data room hosted by Merrill DataSite.

 

Jaguar Material Adverse Effect” means any effect, change, event or occurrence  that, individually or in the aggregate, has had, or would reasonably be expected to have, a material adverse effect on the business, properties, assets, liabilities, results of operation or financial condition of the Jaguar Parties and their Subsidiaries (but with respect to each Jaguar Fund, only the Included Assets), taken as a whole; provided, however, that no effect, change, event or occurrence resulting or arising from the following shall be deemed to constitute a Jaguar Material Adverse Effect or shall be taken into account when determining whether a Jaguar Material Adverse Effect has occurred or is reasonably likely to exist or occur:  (i) any changes in general United States or global political, regulatory or economic conditions, or the capital, financial or securities markets, including changes in interest rates, to the extent that such changes do not have a disproportionately greater adverse impact on the Jaguar Parties and their

 

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Subsidiaries, taken as a whole, relative to other similarly situated participants in the industries in which the Jaguar Parties and their Subsidiaries operate generally, (ii) any changes generally affecting the industries or markets in which the Jaguar Parties and their Subsidiaries operate to the extent that such changes do not disproportionately have a greater adverse impact on the Jaguar Parties and their Subsidiaries, relative to other similarly situated participants in the industries in which the Jaguar Parties operate generally, (iii) any changes after the date hereof in GAAP (or any interpretation thereof in accordance with the Financial Accounting Standards Board Statements of Financial Accounting Standards and Interpretations), (iv) any adoption, implementation, promulgation, repeal, modification, amendment, reinterpretation, change or proposal of any applicable Law of or by any Governmental Entity after the date hereof to the extent that such adoption, implementation, promulgation, repeal, modification, amendment, reinterpretation, change or proposal does not disproportionately have a greater adverse impact on the Jaguar Parties, taken as a whole, relative to other similarly situated participants in the industries in which the Jaguar Parties operate generally, (v) any actions taken, or the failure to take any action, if such action or such failure to take action is at the written request or with the prior written consent of the Giants Parties, (vi) any effect, change, event or occurrence  attributable to the negotiation, execution, announcement or other public disclosure or performance of this Agreement and the Transactions or the impact of such negotiation, execution, announcement, disclosure or performance on relationships, contractual or otherwise, with customers, suppliers, tenants, lenders, employees, unions, licensors, joint venture partners or other Persons with business relationships with Jaguar Parties, or any action by a Governmental Entity or any Action or dispute brought or threatened out of or relating from such negotiation, execution, announcement, disclosure or performance (provided that this clause (vi) shall not apply with respect to Section 4.3 of this Agreement), (vii) any failure by the Jaguar Parties to meet any internal projections, estimates or expectations of the Jaguar Included Properties’ revenue, earnings or other financial performance or results of operations for any period, in and of itself, or any failure by the Jaguar Parties to meet their internal budgets, plans or forecasts of their revenues, earnings or other financial performance or results of operations, in and of itself (it being understood that the facts or occurrences giving rise or contributing to such failure that are not otherwise excluded from the definition of a “Jaguar Material Adverse Effect” may be taken into account, unless such fact or occurrence is otherwise excluded from this definition), (viii) any effect, change, event or occurrence after the date hereof arising out of changes in geopolitical conditions, acts of terrorism, civil disobedience or sabotage, the commencement, continuation or escalation of a war, acts of armed hostility, weather conditions or other force majeure events, including any material worsening of such conditions threatened or existing as of the date of this Agreement to the extent that such changes do not disproportionately have a greater adverse impact on the Jaguar Parties, taken as a whole, relative to other similarly situated participants in the industries in which the Jaguar Parties operate generally and (ix) any disclosure by the Giants Parties or Giants Subsidiaries regarding its plans with regard to the conduct of the business of the Jaguar Included Properties and other Included Assets following the Closing.

 

Jaguar Permitted Liens” means all of the following:  (i) the matters set forth in any of the Jaguar Title Policies, (ii) the Jaguar Leases and any ground lease  affecting any of the Jaguar Included Properties as of the date hereof, or amendments or modifications to the foregoing, entered into after the date hereof in accordance with the terms of this Agreement, (iii) Liens for current real estate taxes and special assessments which are not yet due and payable (subject to

 

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apportionment in accordance with the terms hereof), (iv) standard exceptions and provisions contained in the form of owner’s title insurance policies for each of the Jaguar Included Properties, (v) subject to the adjustments provided for herein and to the extent due after Closing, any charges for service, installation, connection, maintenance, sewer, water, electricity, telephone, cable television or gas, (vi) rights of vendors and holders of security interests on personal property installed at any Jaguar Included Property by tenants under Jaguar Leases in effect on the date hereof or entered into after the date hereof in accordance with the terms of this Agreement, (vii) to the extent permitted under the Jaguar Leases in effect on the date hereof or entered into after the date hereof in accordance with the terms of this Agreement, rights of tenants to remove fixtures at the expiration of the term of the Jaguar Leases of such tenants, (viii) mechanics liens arising by or through the tenants under any Jaguar Leases affecting the Included Assets, (ix) any exceptions created by the ground lessor pursuant to any ground lease  on the fee interest of the relevant property, (x) Laws, regulations, resolutions or ordinances, including, without limitation, building, zoning and environmental protection, as to the use, occupancy, subdivision, development, conversion or redevelopment of any Jaguar Included Property currently or hereinafter imposed by any governmental or quasi-governmental body or authority;(xi) Liens relating to Indebtedness that is disclosed in Section 4.16(a)(v) of the Jaguar Disclosure Letter; and (xii) any other non-monetary Liens, limitations, restrictions or title defects first arising from and after the date of this Agreement in the ordinary course of operation of the applicable Included Asset that do not have a Jaguar Material Adverse Effect on the applicable Included Asset.  In no event shall any Jaguar right of first refusal under Section 6.1 constitute a Jaguar Permitted Lien.

 

Jaguar REIT Opinions” means the Fund VII REIT Opinion, the Fund VIII REIT Opinion, the Fund IX REIT Opinion, the Atlantic REIT Opinion and the Core REIT Opinions.

 

Jaguar REITs” means Fund VII REIT, Fund VIII REIT, Fund IX REIT, Atlantic REIT and the Core REITs.

 

Jaguar Surviving REITs” means Fund VII REIT, Fund VIII REIT, Atlantic REIT and the Core REITs.

 

Jaguar TRSs” means the taxable REIT subsidiaries of the Jaguar REITs which includes:  JBG/Fund VII Services II, L.L.C., , Fund VIII TRS, L.L.C., JBG/Fund VIII Services, L.L.C., JBG/New York Hotel Operator, L.L.C., JBG/Crystal City Hotel Operator, L.L.C., JBG/151 Q Street Services, L.L.C., and JBG/Foundry Office Services, L.L.C.

 

Joint Venture” means any Person owning, directly or indirectly, any interests in any Jaguar Included Properties and in which one or more Jaguar Parties owns Equity Interests and which Person is not wholly owned, directly or indirectly, by such Jaguar Parties.

 

Joint Venture Agreement” means any partnership agreement, limited partnership agreement, shareholders’ agreement, limited liability company operating agreement, joint venture agreement (or the equivalent), together with all amendments, amendment and restatements, addendums, side letters and joinders in respect of which any of the Joint Ventures is governed.

 

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Joint Venture Partner” means any Person, other than a Jaguar Party, which holds a direct or indirect legal or beneficial right, title or interest or the right or option to acquire such right, title or interest, in a Joint Venture.

 

Kickout Interest” means any Included Interest that is deemed to be a “Kickout Interest” pursuant to Section 5.2(h).

 

knowledge” means, with respect to any Giants Party, the actual knowledge of any executive officer (under the rules promulgated under the Exchange Act) of Giants as of the date hereof.

 

knowledge” means, with respect to any Jaguar Party, the actual knowledge of any member of the executive committee of Jaguar Operating Partners as of the date hereof.

 

Law” means any law, statute, code, rule, regulation, order, ordinance, judgment or decree or other requirement or rule of law of any Governmental Entity having the effect of law.

 

Liability” means any liability, debt, obligation, deficiency, interest, Tax, penalty, fine, claim, demand, damage, judgment, cause of action or other loss (including loss of benefit or relief), cost or expense of any kind or nature whatsoever, whether asserted or unasserted, absolute or contingent, accrued or unaccrued, liquidated or unliquidated, and whether matured or unmatured, regardless of when asserted.

 

Lien” means any lien, pledge, hypothecation, mortgage, security interest, encumbrance, claim, infringement, interference, option, right of first refusal, preemptive right, community property interest or other restriction of any nature (including any restriction on the voting of any security, any restriction on the transfer of any security or other asset, any restriction on the possession, exercise or transfer of any other attribute of ownership of any asset).

 

LTIP Unit” means a partnership unit designated by the Operating Partnership as an LTIP Unit under the Partnership Agreement.

 

Mandatory Uses” means the payment of (i) the Cash Consideration, plus (ii) the aggregate Expenses of the Parties other than Excluded Expenses, plus (iii) the amount required to repay in full at the Closing the Existing Giants Credit Facility and any other Indebtedness of Giants or any Giants Subsidiary that will accelerate or become due and payable upon the consummation of the Transactions including, without limitation, any make whole or prepayment costs or premiums, plus (iv) up to $97,500,000 to be used to pay (or repay Indebtedness incurred by a Jaguar Party or any of its Subsidiaries to pay): (A) up to $68,000,000 to replace maturing Indebtedness in respect of the Jaguar Properties known as 1600 K, 2121 Wisconsin and 2115 Wisconsin); (B) up to $20,000,000 in the aggregate of pursuit and acquisition costs with respect to the Designated Pipeline Properties; (C) up to $4,500,000 of contingent purchase price payments due in connection with the acquisition by Jaguar Operating Partners of interests in JBG/Rosenfeld Retail Properties, LLC; and (D) up to $5,000,000 in connection with the purchase of interests of third parties in the Jaguar Included Property known as “Tritec”.

 

MGCL” means the Maryland General Corporation Law, as amended.

 

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Multiemployer Plan” means a “multiemployer plan” within the meaning of Section 3(37) of ERISA.

 

Net Cash Flow” means, during the applicable period, the following, calculated on a basis consistent with the Roll-Forward Pro Forma March 31, 2016 Cash Flow Calculation:

 

(a)         cash operating revenues; minus

 

(b)         cash operating expenses (other than Expenses, but including Excluded Expenses); minus

 

(c)          Interest Payments.

 

Net Invested Capital” means, for the Included Entities during the applicable period, (A) the equity capital contributed to an Included Entity, excluding any amounts contributed and used for an Other Use, minus (B) Distributions.

 

NYSE” means the New York Stock Exchange.

 

OP Units” means a partnership unit designated by the Operating Partnership as an OP Unit under the Partnership Agreement.

 

OPP Agreement” means the Second Amended and Restated 2014 Advisor Multi-Year Outperformance Agreement, effective as of August 5, 2015, among Giants, the Operating Partnership and Giants Advisor, as in effect on the date hereof and as modified by the OPP Termination Agreement.

 

OPP Termination Agreement” means the Amendment to the OPP Agreement and Release, dated as of May 25, 2016, by and among Giants, the Operating Partnership and Giants Advisor.

 

Other Uses” means the payment of (i) the aggregate Expenses of the Parties other than Excluded Expenses and (ii) up to $93,000,000 to be used to pay (or repay Indebtedness incurred by a Jaguar Party or any of its Subsidiaries to pay): (A) up to $68,000,000 to replace maturing Indebtedness in respect of the Jaguar Properties known as 1600 K, 2121 Wisconsin and 2115 Wisconsin; (B) up to $20,000,000 in the aggregate of pursuit and acquisition costs with respect to the Designated Pipeline Properties; and (C) up to $5,000,000 in connection with the purchase of interests of third parties in the Jaguar Included Property known as “Tritec”.

 

Partnership Agreement” means the Fourth Amended and Restated Agreement of Limited Partnership of the Operating Partnership entered into on April 15, 2014, as amended, modified or supplemented through the date hereof.

 

Person” means a natural person, sole proprietorship, firm, entity, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, unincorporated syndicate, unincorporated organization, joint venture, Governmental Entity or other entity or organization.

 

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Plan” means (i) each employment, consulting, noncompetition, nondisclosure, nonsolicitation, severance, termination, pension, retirement, supplemental retirement, excess benefit, profit sharing, bonus, incentive, deferred compensation, retention, transaction and change in control plan, program, arrangement, agreement, policy or commitment, (ii) each stock option, restricted stock, deferred stock, performance stock, stock appreciation, stock unit or other equity or equity-based plan, program, arrangement, agreement, policy or commitment, and (iii) each savings, life, health, disability, accident, medical, dental, vision, death benefit, cafeteria, insurance, flex spending, adoption/dependent/employee assistance, tuition, vacation, paid-time-off, perquisite, outplacement, welfare benefit, fringe benefit and other similar compensation or benefit plan, program, arrangement, agreement, policy (whether formal or informal) or commitment, including in each case each “employee benefit plan” as defined in Section 3(3) of ERISA (whether not subject to ERISA) and any trust, escrow, funding, insurance or other agreement related to any of the foregoing.

 

Potential Kickout Interests” means all Included Interests holding, directly or indirectly, any interest in the Included Properties listed on Sections 5.2(h)(i), 5.2(h)(ii)(A) and 5.2(h)(iii)(A) of the Jaguar Disclosure Letter.

 

Property Management Agreement” means the Amended and Restated Management Agreement, dated as of September 2, 2010, among Giants, the Operating Partnership and Giants Property Manager.

 

Related Party” means (i) with respect to the Giants Parties, Giants Advisor and any former, current or future officers, employees, directors, partners, equityholders, managers, members, Affiliates or agents of Giants, any Giants Subsidiary or Giants Advisor, and the family members of each such person (other than the Jaguar Parties) and (ii) with respect to the Jaguar Parties, the principals and executive officers of any Jaguar Party or its Subsidiaries, Affiliates (other than the Giants Parties) and members of the family of each such person.

 

Representatives” means, with respect to any Person, such Person’s directors, officers, employees, consultants, financial advisors, accountants, legal counsel, investment bankers, and other agents, advisors and representatives.

 

Required Jaguar Consents” means, collectively, the Required Jaguar Debt Consents, the Required Jaguar Ground Lease Consents and the Required Jaguar JV Consents.

 

Retained Partners Equity” means, for the Included Entities during the applicable period, the sum of (i) Net Cash Flow of the Included Entities, taken as a whole, plus (ii) Net Invested Capital.

 

Roll-Forward Pro Forma March 31, 2016 Cash Flow Calculation” means collectively the cash flow calculation and related supporting schedules set forth in the Jaguar Data Room under the folder “16. MCA-Additional Invested Capital Rider”.

 

SDAT” means the State Department of Assessments and Taxation of Maryland.

 

Securities Act” means the Securities Act of 1933, as amended, and all regulations, rules and other guidance promulgated thereunder.

 

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Service Provider” means any employee (including any Jaguar Employee), consultant, director or other service provider of any Jaguar Party or any Affiliate of any Jaguar Party who is engaged or employed at, or principally provides services to, any of the Jaguar Included Properties.

 

Subsidiary” or “Subsidiaries” means with respect to any Person, any corporation, limited liability company, partnership or other organization, whether incorporated or unincorporated, of which (i) at least a majority of the outstanding shares of capital stock of, or other Equity Interests, having by their terms ordinary voting power to elect a majority of the board of directors or others performing similar functions with respect to such corporation or other organization is directly or indirectly owned or controlled by such Person or by any one or more of its Subsidiaries, or by such Person and one or more of its Subsidiaries, or (ii) with respect to a partnership or any limited liability company, such Person or any other Affiliate of such Person is a general partner or managing member of such partnership or limited liability company.  Notwithstanding the above, with regard to each Jaguar Fund, a “Subsidiary” means only any Included Entity in which such Jaguar Fund has a direct or indirect Equity Interest; provided, that a “Subsidiary” shall include solely with respect to representations and warranties contained in Section 4.13, any Jaguar TRS that is not an Included Entity and any Jaguar REIT not otherwise described in this definition.

 

Tax” or “Taxes” means any and all taxes, levies, duties, tariffs, imposts and other similar charges and fees (together with any and all interest, penalties, additions to tax and additional amounts imposed with respect thereto, whether disputed or not) imposed by any Governmental Entity or domestic or foreign taxing authority, including income, franchise, windfall or other profits, gross receipts, premiums, property, sales, use, net worth, capital stock, payroll, employment, social security, workers’ compensation, unemployment compensation, excise, withholding, ad valorem, stamp, transfer, value-added, gains tax and license, registration and documentation fees, severance, occupation, environmental, customs duties, disability, real property, personal property, registration, alternative or add-on minimum, or estimated tax.

 

Tax Indemnification Agreement” means, collectively:  (i) the Indemnity Agreement, dated December 28, 2012, between Giants Advisor and Giants, and (ii) the Indemnity Agreement, dated December 31, 2013, between Giants Advisor and Giants.

 

Tax Return” means any report, return, certificate, claim for refund, information return, election, estimated tax filing or declaration required to be filed with any Governmental Entity or domestic or foreign taxing authority with respect to Taxes, including any schedule or attachment thereto, and including any amendments thereof.

 

Treasury Regulations” means the U.S. Treasury Regulations, promulgated under the Code.

 

WWP Joint Venture” means the “Company” as defined in the WWP Joint Venture Agreement.

 

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WWP Joint Venture Agreement” means that certain Second Amended and Restated Limited Liability Company Agreement of WWP Holdings, LLC, dated as of October 31, 2013, by and between ARC NYWWPJV001, LLC and WWP Sponsor, LLC, as amended by that certain First Amendment to Second Amended and Restated Limited Liability Company Agreement, dated October 3, 2014.

 

Section 9.7.                                                         Terms Defined Elsewhere.  The following terms are defined elsewhere in this Agreement, as indicated below:

 

“3-14 Financial Statements”

 

Section 4.6(a)

“Accountants”

 

Section 5.11(a)

“Action”

 

Section 3.1010

“Adverse Recommendation Change”

 

Section 5.7(d)

“Advisory Agreement”

 

Section 4.15(b)

“Agreement”

 

Preamble

“Allocation”

 

Section 1.4

“Anti-Money Laundering Laws

 

Section 4.23

“Atlantic REIT Opinion”

 

Section 7.2(g)(v)

“Board Designees”

 

Section 5.15

“Book-Up”

 

Section 6.3(c)

“Cash Consideration”

 

Section 1.3(a)

“Chosen Courts”

 

Section 9.12(b)

“Closing”

 

Section 2.1

“Closing Date”

 

Section 2.1

“Consideration”

 

Section 1.3

“Contribution Agreement”

 

Section 1.1(a)

“Core REIT Opinions”

 

Section 7.2(g)(iv)

“County”

 

Section 6.1(b)

“DC Rights Holders”

 

Section 6.1(c)

“D&O Insurance”

 

Section 6.5(b)

“Equity Consideration”

 

Section 1.3(b)

“Equity Issuance”

 

Recitals

“Excluded Assets”

 

Recitals

“Excluded Managing Member Interest”

 

Section 5.2(h)(ii-iii)

“Excluded Properties”

 

Recitals

“Expense Amount”

 

Section 8.3(a)(iii)

“FIRPTA Certificate”

 

Section 2.3(d)

“Fund I”

 

Section 1.1(a)

“Fund II”

 

Section 1.1(b)

“Fund III”

 

Section 1.1(c)

“Fund VI”

 

Section 1.1(d)

“Fund VII”

 

Section 1.1(e)

 

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“Fund VIII”

 

Section 1.1(f)

“Fund IX”

 

Section 1.1(g)

“Fund VII REIT”

 

Section 1.1(e)

“Fund VII REIT Opinion”

 

Section 7.2(g)(i)

“Fund VIII REIT”

 

Section 1.1(f)

“Fund VIII REIT Opinion”

 

Section 7.2(g)(ii)

“Fund IX REIT”

 

Section 1.1(g)(i)

“Fund IX REIT Opinion”

 

Section 7.2(g)(iii)

“GAAP”

 

Section 3.6(c)

“Giants”

 

Preamble

“Giants Advisor”

 

Recitals

“Giants Board”

 

Recitals

“Giants Board Designee”

 

Section 5.15

“Giants Board Recommendation”

 

Recitals

Giants Board Resignations

 

Section 5.15

“Giants Bylaws”

 

Section 3.2

“Giants Charter”

 

Section 3.2

“Giants Charter Amendment”

 

Section 5.16

“Giants Common Stock”

 

Section 3.3(a)

“Giants Disclosure Letter”

 

Article III

“Giants Expense Reimbursement”

 

Section 8.3(e)(i)

“Giants Ground Leases”

 

Section 3.18(f)

“Giants Insurance Policies”

 

Section 3.21

“Giants Leases”

 

Section 3.18(g)

“Giants Material Contract”

 

Section 3.14(a)

“Giants Parties”

 

Preamble

“Giants Permits”

 

Section 3.16(b)

“Giants Preferred Stock”

 

Section 3.3(a)

“Giants Properties”

 

Section 3.18(a)

“Giants Property Manager”

 

Recitals

“Giants REIT Opinion”

 

Section 7.3(g)

“Giants SEC Filings”

 

Section 3.6(a)

“Giants Subsidiary Partnership”

 

Section 3.13(h)

“Giants Tax Protection Agreement”

 

Section 3.13(h)

“Giants Title Policy”

 

Section 3.18(k)

“Giants Valuation”

 

Section 6.3(c)

“Governmental Entity”

 

Section 3.5(a)

“Historic Giants Assets”

 

Section 6.3(c)

“HSR Act”

 

Section 3.5(b)

“Included Entity”

 

Recitals

“Included Interests”

 

Recitals

 

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“Intervening Event”

 

Section 5.7(h)(i)

“Issued Giants Shares”

 

Section 1.3(b)

“Issued OP Units”

 

Section 1.3(b)

“Jaguar Board Designee”

 

Section 5.15

“Jaguar Debt Refinancing”

 

Section 5.2(h)(i)

“Jaguar Designee”

 

Section 1.3

“Jaguar Development Properties”

 

Section 4.10(a)

“Jaguar Disclosure Letter”

 

Article IV

“Jaguar District of Columbia Multifamily Properties”

 

Section 6.1(c)

“Jaguar Employees”

 

Section 4.20(a)

“Jaguar Financial Statements”

 

Section 4.6(a)

“Jaguar Funds”

 

Preamble

“Jaguar Ground Leases”

 

Section 4.9(h)

“Jaguar Included Properties”

 

Recitals

“Jaguar Insurance Policies”

 

Section 4.25

“Jaguar Leases”

 

Section 4.9(i)

“Jaguar Management Entities”

 

Preamble

“Jaguar Material Contract”

 

Section 4.16

“Jaguar Montgomery County Multifamily Properties”

 

Section 6.1(b)

“Jaguar Operating Partners”

 

Preamble

“Jaguar Operating Partners Financial Statements”

 

Section 4.6(a)

“Jaguar Parties”

 

Preamble

“Jaguar Permits”

 

Section 4.14(b)

“Jaguar Properties”

 

Preamble

“Jaguar Representative”

 

Section 1.7(a)

“Jaguar Retail Financial Statements”

 

Section 4.6(a)

“Jaguar Subsidiary Partnership”

 

Section 4.13(l)

“Jaguar Tax Protection Agreement”

 

Section 4.13(l)

“Jaguar Title Policy”

 

Section 4.9(g)

“Legacy LLC”

 

Recitals

“Managing Member Entities”

 

Recitals

“Managing Member Interests”

 

Section 1.1(k)(iii)

“Material Giants Leases”

 

Section 3.18(h)

“Material Jaguar Leases”

 

Section 4.6(a)

“Merger Agreement”

 

Section 1.1(g)(ii)

“Minimum Equity Consideration”

 

Section 7.2(h)

“Montgomery County Rights Holders”

 

Section 6.1(b)

“Non-Recourse Party”

 

Section 9.16

“Notice of Superior Proposal/Intervening Event”

 

Section 5.7(f)

“OFAC”

 

Section 4.22

“Operating Partnership”

 

Preamble

 

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“Ordinances”

 

Section 6.1(b)

“Other Giants Subsidiary”

 

Section 3.1(c)

“Outside Date”

 

Section 8.1(b)(i)

“Ownership Limit Waiver Agreement”

 

Section 5.17

“Parties”

 

Preamble

“Partnership Agreement Amendment and Restatement”

 

Section 2.2(e)

“Partnership Merger Agreement”

 

Section 1.1(k)(i)

“Payoff Letter”

 

Section 5.9

“Proposed Jaguar IPO”

 

Section 5.12

“Proxy Statement”

 

Section 3.5(b)

“Qualified REIT Subsidiary”

 

Section 3.1(c)

“Qualifying Income”

 

Section 8.3(e)(i)

“Recap Investors”

 

Section 1.1(i)

“Registration Rights Agreements”

 

Section 2.2(d)

“REIT”

 

Section 3.1(c)

“Related Party Termination Agreements”

 

Section 3.27

“Required Jaguar Debt Consents”

 

Section 4.3

“Required Jaguar Ground Lease Consents”

 

Section 4.3

“Required Jaguar JV Consents”

 

Section 4.3

“Restructuring Transactions”

 

Section 5.10(a)

“SEC”

 

Section 3.5(b)

“SEFC Investors”

 

Section 1.1(j)

“SEFC Partners”

 

Section 1.1(j)

“Superior Proposal”

 

Section 5.7(h)(ii)

“Takeover Proposal”

 

Section 5.7(h)(iii)

“Taxable REIT Subsidiary”

 

Section 3.1(c)

“Termination Agreement and Release

 

Recitals

“Termination Fee”

 

Section 8.3(a)(i)

“TOPA”

 

Section 6.1(c)

“Transactions”

 

Recitals

“Transfer Taxes”

 

Section 6.3(b)

“Transition Services Agreement”

 

Recitals

“UDM”

 

Section 1.1(h)

“Vested LTIP Units”

 

Section 5.14

“Wanted LLC”

 

Recitals

“WARN Act”

 

Section 4.20(b)

 

Section 9.8.                                                         Interpretation.  When a reference is made in this Agreement to Sections, such reference shall be to a Section of this Agreement unless otherwise indicated.  Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation.” The table of contents and headings

 

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set forth in this Agreement are for convenience of reference purposes only and shall not affect or be deemed to affect in any way the meaning or interpretation of this Agreement or any term or provision hereof.  When reference is made herein to a Person, such reference shall be deemed to include all direct and indirect Subsidiaries of such Person unless otherwise indicated or the context otherwise requires.  All references herein to the Subsidiaries of a Person shall be deemed to include all direct and indirect Subsidiaries of such Person unless otherwise indicated or the context otherwise requires.  The Parties agree that they have been represented by counsel during the negotiation and execution of this Agreement and, therefore, waive the application of any Law, regulation, holding or rule of construction providing that ambiguities in an agreement or other document will be construed against the party drafting such agreement or document.

 

Section 9.9.                                                         Counterparts.  This Agreement may be executed in two or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.  Delivery of an executed counterpart of a signature page to this Agreement by facsimile, portable document format (.pdf) or other electronic means shall be effective as delivery of a manually executed counterpart to this Agreement.

 

Section 9.10.                                                  Entire Agreement; Third-Party Beneficiaries.

 

(a)                                 This Agreement (including the Giants Disclosure Letter and the Jaguar Disclosure Letter) and the Confidentiality Agreement constitute the entire agreement among the Parties with respect to the subject matter hereof and thereof and supersede all other prior agreements and understandings, both written and oral, among the Parties or any of them with respect to the subject matter hereof and thereof.

 

(b)                                 Neither this Agreement (including the Giants Disclosure Letter and the Jaguar Disclosure Letter) nor the Confidentiality Agreement are intended to confer upon any Person, other than the Parties and their successors and permitted assigns, any rights or remedies hereunder, other than Section 6.5 (Directors’ and Officers’ Indemnification and Insurance) and Section 9.16 (No Recourse).

 

Section 9.11.                                                  Severability.  If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by rule of Law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the Transactions is not affected in any manner adverse to any Party.  Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in an acceptable manner to the end that the Transactions are fulfilled to the extent possible.

 

Section 9.12.                                                  Governing Law; Jurisdiction.

 

(a)                                 This Agreement, and all claims or causes of actions (whether at Law, in contract or in tort) that may be based upon, arise out of or related to this Agreement or the negotiation, execution or performance of this Agreement, shall be governed by, and construed in accordance with, the Laws of the State of Maryland without giving effect to conflicts of laws

 

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principles (whether of the State of Maryland or any other jurisdiction that would cause the application of the Laws of any jurisdiction other than the State of Maryland).

 

(b)                                 All Actions arising out of or relating to this Agreement shall be heard and determined exclusively in the Circuit Court for Baltimore City, Maryland, or if jurisdiction over the matter is vested exclusively in federal courts, the United States District Court for the District of Maryland, and the appellate courts to which orders and judgments thereof may be appealed (the “Chosen Courts”).  Each of the Parties hereby irrevocably and unconditionally (a) submits to the exclusive jurisdiction of the Chosen Courts for the purpose of any Action arising out of or relating to this Agreement brought by any Party, whether sounding in tort, contract or otherwise, (b) consents to the assignment of any proceeding in the Circuit Court for Baltimore City, Maryland to the Business and Technology Case Management Program pursuant to Maryland Rule 16-205 (or any successor thereof), (c) agrees not to commence any such action or proceeding except in such courts, (d) agrees that any claim in respect of any such action or proceeding may be heard and determined in any Chosen Court, (e) waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any such action or proceeding, and (f) waives, to the fullest extent permitted by Law, the defense of an inconvenient forum to the maintenance of such action or proceeding.  Each of the Parties agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law.  Each Party irrevocably consents to service of process in the manner provided for notices in Section 9.5.  Nothing in this Agreement will affect the right of any Party to serve process in any other manner permitted by Law.

 

Section 9.13.                                                  Waiver of Jury Trial.  EACH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT AND ANY OF THE AGREEMENTS DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.  EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE EITHER OF SUCH WAIVERS, (B) IT UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVERS, (C) IT MAKES SUCH WAIVERS VOLUNTARILY, AND (D) IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.13.

 

Section 9.14.                                                  Assignment.  This Agreement shall not be assigned by any of the Parties (whether by operation of Law or otherwise) without the prior written consent of the other Parties.  Any assignment referred to in the immediately preceding sentence shall not relieve any Party of any obligation hereunder, and following such assignment this Agreement will be binding upon, inure to the benefit of and be enforceable by the Parties and their respective successors and assigns.

 

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Section 9.15.                                                  Enforcement; Remedies.

 

(a)                                 Except as otherwise provided herein, any and all remedies herein expressly conferred upon a Party will be deemed cumulative with and not exclusive of any other remedy conferred hereby, or by Law or equity upon such Party, and the exercise by a Party of any one remedy will not preclude the exercise of any other remedy.

 

(b)                                 The Parties’ right of specific enforcement is an integral part of the Transactions and each Party hereby waives any objections to the grant of the equitable remedy of specific performance to prevent or restrain breaches of this Agreement by any other Party (including any objection on the basis that there is an adequate remedy at Law or that an award of specific performance is not an appropriate remedy for any reason at Law or equity), and except as set forth in this Section 9.15, each Party shall be entitled to an injunction or injunctions and to specifically enforce the terms and provisions of this Agreement to prevent or restrain breaches or threatened breaches of, or to enforce compliance with, the covenants and obligations of such Party under this Agreement all in accordance with the terms of this Section 9.15.  In the event any Party seeks an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement, such Party shall not be required to provide any bond or other security in connection with such order or injunction all in accordance with the terms of this Section 9.15.