FORM 20-F/A Brookfield Property Partners L.P. - Brookfield Asset ...

such interests (in lieu of redemption) in exchange for our units. See Item 10.B. “Additional Information —Memorandum and Articles of Association — Description of the Property Partnership Limited PartnershipAgreement — Redemption-Exchange Mechanism”. Taken together, the effect of the redemption right and theright of exchange is that the holders of Redemption-Exchange Units will receive our units, or the value of suchunits, at the election of our company. Should we determine not to exercise our right of exchange, cash required tofund a redemption of Redemption-Exchange Units will likely be financed by a public offering of our units.Registration Rights AgreementOur company has entered into a customary registration rights agreement with Brookfield pursuant towhich we have agreed that, upon the request of Brookfield, our company will file one or more registrationstatements to register for sale under the U.S. Securities Act of 1933, as amended, or one or more prospectuses toqualify the distribution in Canada of, any of our units held by Brookfield (including units of our companyacquired pursuant to the Redemption-Exchange Mechanism). Under the registration rights agreement, ourcompany will not be required to file a U.S. registration statement or a Canadian prospectus unless Brookfieldrequests that units having a value of at least $50 million be registered or qualified. In the registration rightsagreement, we have agreed to pay expenses in connection with such registration and sales, except for anyunderwriting discounts or commissions, which will be borne by the selling unitholder, and to indemnifyBrookfield for material misstatements or omissions in the registration statement and/or prospectus.Equity Enhancement and Incentive DistributionsProperty GP LP, a wholly-owned subsidiary of Brookfield Asset Management, is entitled to receiveequity enhancement distributions and incentive distributions from the Property Partnership as a result of itsownership of the general partnership interest in the Property Partnership. Property GP LP will receive quarterlyequity enhancement distributions equal to 0.3125% of the amount by which our company’s total capitalizationvalue exceeds an initial reference value determined based on the market capitalization immediately following thespin-off, subject to adjustment as described under “Additional Information — Memorandum and Articles ofAssociation — Description of the Property Partnership Limited Partnership Agreement — Distributions”.In addition, the Property GP LP will receive incentive distributions calculated in increments based on theamount by which quarterly distributions on the limited partnership units of the Property Partnership exceedspecified target levels as set forth in the Property Partnership’s limited partnership agreement. See Item 10.B.“Additional Information — Memorandum and Articles of Association — Description of the Property PartnershipLimited Partnership Agreement — Distributions”.The Property GP LP may, at its sole discretion, elect to reinvest equity enhancement distributions andincentive distributions in exchange for Redemption-Exchange Units.To the extent that any Holding Entity or any operating entity pays to Brookfield any comparableperformance or incentive distribution, the amount of any future incentive distributions will be reduced in anequitable manner to avoid duplication of distributions.General Partner DistributionsPursuant to our limited partnership agreement, the BPY General Partner is entitled to receive a generalpartner distribution equal to 0.2% of the total distributions of our company.Pursuant to the limited partnership agreement of the Property Partnership, Property GP LP is entitled toreceive a general partner distribution from the Property Partnership equal to a share of the total distributions ofthe Property Partnership in proportion to the Property GP LP’s percentage interest in the Property Partnershipwhich, immediately following the spin-off, will be equal to 1% of the total distributions of the Property126