LIPPO-MAPLETREE - Lippo Malls Indonesia Retail Trust - Investor ...

Appendix Bprice is to be negotiated and agreed in good faith between the parties, provided that such acquisition priceshall not be more than the appraised value of Supermal Pakuwon Indah and Pakuwon Trade Center asdetermined by an independent property valuer to be appointed by the Trustee and the appraised value isagreed by the Vendor before the signing of the conditional sale and purchase agreement.(c)Rental Guarantee DeedsOn 10 August 2007, Lippo Strategic Holdings Inc (“Lippo Strategic”) entered into a Rental Guarantee Deedwith each of the Retail Mall Investment Holding Companies pursuant to which Lippo Strategic will provide arental guarantee to the relevant Retail Mall Investment Holding Companies in respect of existing and newunits in the respective retail malls which are untenanted and undertake to pay to the relevant Retail MallInvestment Holding Companies any shortfall in the maintenance and operation costs which the relevantOperating Company has undertaken to bear under the respective Operating Costs Agreement.The Rental Guarantee Deeds cover the period commencing from the Listing Date up to 31 December2009. Pursuant to the Rental Guarantee Deeds, Lippo Strategic is obliged to pay to the Retail MallInvestment Holding Companies a specified sum in respect of each Retail Mall for every year during the saidperiod. The first of such payment will be paid on or before 31 January 2008, and subsequent payments willbe made on a quarterly basis thereafter. In the event any of the specified units in the relevant Retail Mallbecomes tenanted during such period, the amount of the specified sum payable by Lippo Strategic inrespect of such Retail Mall will be reduced by the amount of the rental payable under the relevant tenancy,regardless of whether such rental is received by the owner of the relevant Retail Mall and notwithstandingthat such tenancy may be or is terminated prior to the expiry of such period.To secure Lippo Strategic’s performance under each of the Rental Guarantee Deeds, Lippo Strategic isrequired to furnish to the Retail Mall Investment Holding Companies bank guarantees. The aggregateamount of all the bank guarantees to be furnished under the Rental Guarantee Deeds is S$10.0 million.(d)Retail Malls Operating Costs AgreementsPursuant to each of the Operating Costs Agreements to be entered into between the relevant Retail MallProperty Companies and Operating Company, the relevant Operating Company will agree tounconditionally bear, for a period of three years commencing 1 January 2007, all costs directly relatedto the maintenance and operation of the relevant Retail Mall.In consideration of its agreements under the relevant Operating Costs Agreement, the relevant OperatingCompany has the right to collect, through the property manager, a service charge and statutory incomefrom the tenants of that Retail Mall. This service charge is intended to cover the costs directly related to themaintenance and operation of the Retail Mall. The amount of the service charge will be recommended bythe property manager as a result of its review of the prevailing market rates. The statutory income isintended to cover the costs directly related to the provision of utilities to the retail mall.The right to collect the service charge and statutory income shall be in accordance with the leaseagreements entered into by and between the Retail Malls Property Companies and the respective tenantsof the Retail Mall and such collection shall be coordinated by the property manager.The operating costs agreements will lapse on 31 December 2009 and LMIR Trust will bear all costs directlyrelated to the maintenance and operation of the Retail Malls thereafter.(e)Build Operate and Transfer (“BOT”) AgreementsThe Pro Forma Group has the following BOT agreements for the following Retail Malls:1. Cibubur JunctionPT Cibubur Utama (“PT Cibubur”) entered into a BOT agreement with Perusahaan Daerah PembangunanSarana Jaya DKI Jakarta (“Sarana”). PT Cibubur has the right to build operate and transfer the property fora period of 20 years commencing July 2005 and the first priority to extend the agreement. To obtain theextension, PT Cibubur must give at least 3 months prior written notice to Sarana and that PT Cibubur hasmet all obligations under the BOT agreement.B-23