Agreement and Plan of Merger (2001)Full Document 

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                        AGREEMENT AND PLAN OF MERGER



                                BY AND AMONG



                APARTMENT INVESTMENT AND MANAGEMENT COMPANY,



                           CASDEN PROPERTIES INC.



                                    AND



                              XYZ HOLDINGS LLC







                        Dated as of December 3, 2001




                             TABLE OF CONTENTS

                                                                          Page

ARTICLE I  THE MERGER       ................................................5
         Section 1.1       THE MERGER.......................................5
         Section 1.2       EFFECTS OF THE MERGER............................5
         Section 1.3       EFFECTIVE TIME OF THE MERGER.....................6

ARTICLE II  TREATMENT OF SHARES.............................................6
         Section 2.1       CERTAIN DEFINITIONS..............................6
         Section 2.2       EFFECT OF THE MERGER ON SHARES..................13
         Section 2.3       PAYMENT OF MERGER CONSIDERATION.................17
         Section 2.4       APPRAISAL RIGHTS................................20

ARTICLE III  THE CLOSING...................................................20
         Section 3.1       CLOSING.........................................20

ARTICLE IV  REPRESENTATIONS AND WARRANTIES OF CASDEN.......................20
         Section 4.1       ORGANIZATION AND QUALIFICATION; ASSETS..........20
         Section 4.2       CAPITALIZATION..................................23
         Section 4.3       AUTHORITY; NON-CONTRAVENTION; STATUTORY
                           APPROVALS; COMPLIANCE...........................24
         Section 4.4       CASDEN FINANCIAL STATEMENTS.....................26
         Section 4.5       ABSENCE OF CERTAIN CHANGES OR EVENTS............26
         Section 4.6       LITIGATION......................................27
         Section 4.7       TAX MATTERS.....................................27
         Section 4.8       EMPLOYEE MATTERS; ERISA.........................30
         Section 4.9       ENVIRONMENTAL PROTECTION........................34
         Section 4.10      VOTE REQUIRED...................................36
         Section 4.11      HUD      .......................................36
         Section 4.12      ABSENCE OF INDUCEMENT...........................37
         Section 4.13      REAL PROPERTIES.................................37
         Section 4.14      BOOKS AND RECORDS...............................40
         Section 4.15      NO UNDISCLOSED LIABILITIES......................40
         Section 4.16      INSURANCE.......................................40
         Section 4.17      CONTRACTS.......................................41
         Section 4.18      PROPRIETY OF PAST PAYMENTS......................41
         Section 4.19      BANK ACCOUNTS...................................42
         Section 4.20      DEFICIT RESTORATION OBLIGATIONS, ADJUSTED
                           CAPITAL ACCOUNT DEFICITS AND CAPITAL
                           CONTRIBUTION OBLIGATIONS........................42
         Section 4.21      COMPLIANCE WITH LAWS............................42
         Section 4.22      RELATIONSHIPS WITH RELATED PERSONS..............42
         Section 4.23      MARYLAND TAKEOVER LAWS..........................42
         Section 4.24      OFFICERS AND DIRECTORS..........................43
         Section 4.25      NO CASDEN MATERIAL MISSTATEMENTS................43
         Section  4.26     TAX QUESTIONNAIRES..............................43
         Section  4.27     CLOSING PAYOFF AMOUNTS..........................43
         Section  4.28     CASDEN BOARD OF DIRECTORS APPROVAL..............43

ARTICLE V  REPRESENTATIONS AND WARRANTIES OF AIMCO.........................43
         Section 5.1       ORGANIZATION AND QUALIFICATION..................43
         Section 5.2       AIMCO SUBSIDIARIES..............................43
         Section 5.3       CAPITALIZATION..................................44
         Section 5.4       AUTHORITY; NON-CONTRAVENTION; STATUTORY
                           APPROVALS; COMPLIANCE...........................44
         Section 5.5       REPORTS AND FINANCIAL STATEMENTS................46
         Section 5.6       ABSENCE OF CERTAIN CHANGES OR EVENTS............46
         Section 5.7       LITIGATION......................................46
         Section 5.8       REGISTRATION STATEMENT..........................46
         Section 5.9       TAX MATTERS.....................................47
         Section 5.10      EMPLOYEE MATTERS; ERISA.........................48
         Section 5.11      ENVIRONMENTAL PROTECTION........................49
         Section 5.12      HUD   ..........................................50
         Section 5.13      ABSENCE OF INDUCEMENT...........................51
         Section 5.14      NO AIMCO MATERIAL MISSTATEMENTS.................51
         Section 5.15      MARYLAND TAKEOVER LAWS..........................51

ARTICLE VI  CONDUCT OF BUSINESS PENDING THE MERGER.........................51
         Section 6.1       COVENANTS OF CASDEN.............................51
         Section 6.2       COVENANTS OF AIMCO..............................56

ARTICLE VII  ADDITIONAL AGREEMENTS.........................................56
         Section 7.1       ACCESS TO INFORMATION...........................56
         Section 7.2       REGISTRATION RIGHTS AGREEMENT...................57
         Section 7.3       LETTERS OF ACCOUNTANTS..........................57
         Section 7.4       REGULATORY MATTERS..............................58
         Section 7.5       APPROVAL OF CASDEN STOCKHOLDERS.................58
         Section 7.6       PUBLIC ANNOUNCEMENTS............................58
         Section 7.7       NO SOLICITATION.................................59
         Section 7.8       EXPENSES........................................59
         Section 7.9       FURTHER ASSURANCES..............................59
         Section 7.10      REIT STATUS.....................................60
         Section 7.11      EMPLOYEES; EMPLOYEE PLANS.......................60
         Section 7.12      RECORD DATES AND DIVIDEND PAYMENT DATES.........61
         Section 7.13      INSURANCE.......................................61
         Section 7.14      BREACHES 61
         Section 7.15      TRANSFER TAXES..................................61
         Section 7.16      NAMES AND TRADEMARKS............................62
         Section 7.17      PREPARATION OF TAX RETURNS......................62
         Section 7.18      DEPOSIT BY AIMCO................................62
         Section 7.19      TAX FREE REORGANIZATION.........................63
         Section 7.20      MEZZANINE LOAN..................................63
         Section 7.21      PLEDGE AND GUARANTY AGREEMENTS..................63
         Section 7.22      RELEASE  63
         Section 7.23      QUESTIONNAIRES..................................63
         Section 7.24      CPLB DISTRIBUTION...............................64
         Section 7.25      COMMERCIAL PROPERTIES...........................64
         Section 7.26      LEGAL MATTERS...................................64
         Section 7.27      RESERVATION OF AIMCO STOCK......................64
         Section 7.28      CASDEN WARRANTS.................................64
         Section 7.29      MATERIAL ADVERSE EFFECTS; KNOWLEDGE OF
                           BREACHES........................................64
         Section 7.30      LITIGATION......................................64
         Section 7.31      LISTING OF SHARES...............................65
         Section 7.32      NAPICO SYNDICATED PROPERTIES....................65
         Section 7.33      COMPLIANCE WITH THE MGCL........................65
         Section 7.34      CASDEN CHARTER..................................65
         Section 7.35      NAPICO PROPERTY CONSENTS........................65
         Section 7.36      CLOSING PAYOFF AMOUNTS..........................65

ARTICLE VIII  CONDITIONS...................................................66
         Section 8.1       CONDITIONS TO EACH PARTY'S OBLIGATION TO
                           EFFECT THE MERGER...............................66
         Section 8.2       CONDITIONS TO OBLIGATION OF AIMCO TO EFFECT
                           THE MERGER......................................66
         Section 8.3       CONDITIONS TO OBLIGATION OF CASDEN TO EFFECT
                           THE MERGER......................................68

ARTICLE IX  TERMINATION, AMENDMENT AND WAIVER..............................70
         Section 9.1       TERMINATION.....................................70
         Section 9.2       EFFECT OF TERMINATION...........................71
         Section 9.3       TERMINATION FEES................................71
         Section 9.4       AMENDMENT.......................................72
         Section 9.5       WAIVER..........................................72
         Section 9.6       DAMAGES.........................................72

ARTICLE X  GENERAL PROVISIONS..............................................72
         Section 10.1      BROKERS.........................................72
         Section 10.2      NOTICES.........................................73
         Section 10.3      MISCELLANEOUS...................................74
         Section 10.4      INTERPRETATION..................................75
         Section 10.5      COUNTERPARTS; EFFECT............................75
         Section 10.6      PARTIES' INTEREST...............................75
         Section 10.7      ENFORCEMENT.....................................75
         Section 10.8      SEVERABILITY....................................76




                           EXHIBITS TO AGREEMENT

Exhibit A         Form of OP Contribution Agreement
Exhibit B-1       Form of Casden Contribution Agreement
Exhibit B-2       Form of Commercial Purchase Agreement
Exhibit C-1       Form of Tri-Party Agreement
Exhibit C-2       Form of WW Letter Agreement
Exhibit C-3       Form of Villa Azure Letter Agreement
Exhibit D         Form of CPLB Merger Agreement
Exhibit E-1       Form of Development LLC Agreement
Exhibit E-2       Form of Ross Purchase Agreement
Exhibit E-3       Form of Development LLC Purchase Agreement
Exhibit F         Form of Consent and Voting Agreement
Exhibit G         Form of Tax Indemnification and Tax Contest Agreement
Exhibit H         Form of Master Indemnification Agreement
Exhibit I         Form of Amended and Restated Limited Liability Company
                  Operating
                  Agreement of Casden Park La Brea A LLC
Exhibit J         Form of Amended and Restated Limited Liability Company
                  Operating
                  Agreement of Casden Park La Brea B LLC
Exhibit K         Form of Amended and Restated Limited Liability Company
                  Operating
                  Agreement of Casden Park La Brea C LLC
Exhibit L         Form of Amended and Restated Limited Liability Company
                  Operating
                  Agreement of Casden Glendon LLC
Exhibit M         Form of Registration Rights Agreement (Stock)
Exhibit N         Form of Consulting Agreement
Exhibit O         List of Core Properties
Exhibit P-1       Form of Tax Questionnaires - Subsidiaries
Exhibit P-2       Form of General Questionnaires
Exhibit P-3       Form of Tax Questionnaires - NAPICO
Exhibit Q-1       Form of Non-Foreign Status (1)
Exhibit Q-2       Form of Non-Foreign Status (2)
Exhibit R         Form of Casden Comfort Letter
Exhibit S         Form of AIMCO Comfort Letter
Exhibit T         Form of Investor Representation Letter
Exhibit U         Form of Escrow Agreement
Exhibit V         Form of Mezzanine Loan Documents
Exhibit W-1       Form of Pledge Agreement
Exhibit W-2       Form of Guaranty Agreement
Exhibit X-1       Form of Release (Casden)
Exhibit X-2       Form of Release (Blackacre)
Exhibit Y         CPLB Instrument of Assignment
Exhibit 8.2(c)-1  Form of Opinion of Casden's Maryland Counsel(1)
Exhibit 8.2(c)-2  Form of Opinion of Casden's Maryland Counsel(2)
Exhibit 8.2(d)    Form of Opinion of Casden Special Counsel
Exhibit 8.2(f)    Form of Casden REIT Opinion
Exhibit 8.3(c)    Form of Opinion of AIMCO's Maryland Counsel
Exhibit 8.3(d)(i) Form of Merger Opinion of Casden's Counsel
Exhibit 8.3(d)(ii)Form of AIMCO Officer's Certificate re: REIT
Exhibit 8.3(e)    Form of Opinion of AIMCO's Counsel



                           SCHEDULES TO AGREEMENT


Schedule 2.1(a)   Closing Payoff Amounts
Schedule 2.1(b)   Casden Mortgage Debt






                           TABLE OF DEFINED TERMS

                                                                      Cross Reference
Term                                                                   in Agreement                            Page

                                                                                                        
Acquisition Proposal .............................................Section 2.1.....................................6
Additional Tax Liabilities .......................................Section 2.1.....................................6
Affected Employees ...............................................Section 7.11(a)................................60
Affiliate ........................................................Section 2.1.....................................6
Aggregate Consideration ..........................................Section 2.1.....................................6
Agreement ........................................................Preamble........................................1
AIC...............................................................Recitals........................................1
AIC Common Per Share Consideration................................Section 2.1.....................................6
AIC Common Stock..................................................Section 2.1.....................................6
AIMCO ............................................................Preamble........................................1
AIMCO Benefit Plans ..............................................Section 5.10(a)................................48
AIMCO Charter ....................................................Section 1.2.....................................5
AIMCO Common Stock ...............................................Section 2.1.....................................6
AIMCO Common Stock Price .........................................Section 2.1.....................................7
AIMCO CPLB Merger Sub ............................................Recitals........................................2
AIMCO Disclosure Letter ..........................................Article V......................................43
AIMCO Financial Statements .......................................Section 5.5....................................46
AIMCO Material Adverse Effect ....................................Section 2.1.....................................7
AIMCO OP .........................................................Recitals........................................1
AIMCO Required Statutory Approvals ...............................Section 5.4(c).................................45
AIMCO SEC Reports ................................................Section 2.1.....................................7
AIMCO Subsidiary .................................................Section 2.1.....................................7
ARP...............................................................Recitals........................................1
Articles of Merger ...............................................Recitals........................................1
Asset Purchase....................................................Recitals........................................3
Blackacre.........................................................Section 8.2(d).................................67
Blackacre Parties.................................................Section 8.2(d).................................67
Canceled Shares ..................................................Section 2.3(b)(i)..............................17
Casden ...........................................................Preamble........................................1
Casden Benefit Plans .............................................Section 4.8(a).................................30
Casden Capital Stock .............................................Section 2.1.....................................7
Casden Charter ...................................................Section 4.1(a).................................20
Casden Class A Preferred Stock ...................................Section 2.1.....................................7
Casden Common Stock ..............................................Section 2.1.....................................7
Casden Contribution Agreement.....................................Recitals........................................1
Casden Contribution Consideration.................................Section 2.1.....................................6
Casden Disclosure Letter .........................................Article IV.....................................20
Casden Financial Statements ......................................Section 2.1.....................................7
Casden Junior Preferred Stock ....................................Section 2.1.....................................7
Casden Material Adverse Effect ...................................Section 2.1.....................................8
Casden Meeting ...................................................Section 7.5(a).................................58
Casden OP ........................................................Recitals........................................1
Casden Option.....................................................Section 2.2(c).................................15
Casden OPUs ......................................................Recitals........................................1
Casden Pro Forma Financial Information............................Section 4.4(b).................................26
Casden Property Consents..........................................Section 4.3(b).................................24
Casden Properties ................................................Section 4.13(a)................................37
Casden Required Consents..........................................Section 7.35...................................24
Casden Required Statutory Approvals ..............................Section 4.3(c).................................25
Casden Reverse Stock Split .......................................Recitals........................................1
Casden Stock Plan ................................................Section 2.1.....................................8
Casden Stockholders' Approval ....................................Section 4.10...................................36
Casden Subsidiary ................................................Section 2.1.....................................8
Casden Transfer Tax Amount........................................Section 2.1.....................................8
Casden I Warrants ................................................Section 2.1.....................................8
Casden II Warrants ...............................................Section 2.1.....................................8
Cerberus Partners.................................................Recitals........................................3
Certificate ......................................................Section 2.3(b)(i)..............................17
Certificates .....................................................Section 2.3(b)(i)..............................17
CIC...............................................................Recitals........................................1
Closing ..........................................................Section 3.1....................................20
Closing Agreement ................................................Section 2.1.....................................8
Closing Date .....................................................Section 3.1....................................20
Code .............................................................Recitals........................................5
CommercialCo .....................................................Recitals........................................2
Commercial Debt ..................................................Recitals........................................2
Commercial Properties ............................................Recitals........................................2
Commercial Sale ..................................................Recitals........................................2
Common Per Share Value............................................Section 2.2(d).................................15
Confidentiality Agreement ........................................Section 7.1....................................56
Consulting Agreement  ............................................Recitals........................................4
Contract .........................................................Section 2.1.....................................8
Contribution Effective Date.......................................Section 2.1.....................................8
Core Properties ..................................................Section 2.1.....................................9
Core Properties Earnout Amount ...................................Section 2.1.....................................9
CPLB .............................................................Recitals........................................1
CPLB LLC..........................................................Recitals........................................3
CPLB Merger ......................................................Recitals........................................2
CPLB Merger Agreement ............................................Recitals........................................2
CPLB Merger Consideration.........................................Section 2.1.....................................9
CPLB Reverse Stock Split .........................................Recitals........................................1
Deferred Consideration............................................Section 2.1.....................................9
Development LLC ..................................................Recitals........................................2
Development LLC Agreement ........................................Recitals........................................2
Development LLC Assets ...........................................Recitals........................................2
Development LLC Purchase Agreement ...............................Recitals........................................3
Development Properties ...........................................Recitals........................................2
Dissenting Shares ................................................Section 2.1.....................................9
Effective Time ...................................................Section 1.3.....................................6
Environmental Claim ..............................................Section 2.1.....................................9
Environmental Laws ...............................................Section 2.1.....................................9
Environmental Permits ............................................Section 4.9(b).................................35
Environmental Release.............................................Section 2.1.....................................9
Equity Consideration..............................................Section 2.2(d).................................15
ERISA ............................................................Section 4.8(a).................................30
ERISA Affiliate ..................................................Section 4.8(a).................................30
Escrow Agent .....................................................Section 7.18...................................62
Escrow Agreement..................................................Section 7.18...................................62
Escrow Amount ....................................................Section 7.18...................................62
Exchange Act .....................................................Section 2.1....................................10
Exchange Fund ....................................................Section 2.3(a).................................17
GAAP .............................................................Section 4.4(a).................................26
General Questionnaires............................................Section 2.1....................................10
Governmental Authority ...........................................Section 4.3(c).................................25
Ground Lease .....................................................Section 4.13(b)................................38
Hazardous Materials ..............................................Section 2.1....................................10
Holder ...........................................................Section 2.1....................................10
HSR Act ..........................................................Section 4.3(c).................................25
HUD ..............................................................Section 4.3(c).................................25
HUD Approval .....................................................Section 7.4(a).................................58
IRS ..............................................................Section 4.8(a).................................31
Joint Venture ....................................................Recitals........................................2
Junior Preferred Liquidation Amount ..............................Section 2.1....................................10
knowledge ........................................................Section 2.1....................................10
Latest Casden Financial Statements................................Section 2.1....................................10
Latest Casden Pro Forma Financial Information.....................Section 2.1....................................11
Laws .............................................................Section 4.13(a)................................38
Leased Properties ................................................Section 4.13(a)(ii)...........................37
Leased Properties Lessees ........................................Section 4.13(a)(ii)............................37
Liens ............................................................Section 4.1(b).................................21
Liquidated Damages ...............................................Section 9.3(a).................................71
Master Indemnification Agreement .................................Recitals........................................3
Merger ...........................................................Recitals........................................1
Mezzanine Loan ...................................................Section 7.20...................................63
Mezzanine Loan Documents .........................................Section 7.20...................................63
Mortgage Debt Amortization........................................Section 2.1....................................11
MGCL .............................................................Section 1.2.....................................5
MSDAT ............................................................Section 1.3.....................................6
NAPICO ...........................................................Section 4.1(e).................................22
NAPICO Entities ..................................................Section 4.1(e).................................22
NAPICO Properties ................................................Section 4.13(a)(iii)..........................37
NAPICO Property Consents .........................................Section 7.35...................................65
NAPICO Property Owners ...........................................Section 4.13(a)(iii)...........................37
NAPICO Syndicated Properties .....................................Section 7.32..................................65
New Merger Sub....................................................Section 2.2(f).................................66
Non-Equity Consideration..........................................Section 2.2(d).................................15
Non-Equity Ratio..................................................Section 2.2(d).................................15
NYSE .............................................................Section 2.1....................................11
OP Contribution ..................................................Recitals........................................1
OP Contribution Agreement ........................................Recitals........................................1
OP Contribution Consideration.....................................Section 2.1....................................11
Option Settlement Amount..........................................Section 2.2(c).................................15
Other Common Per Share Consideration..............................Section 2.1....................................11
Other Common Stock................................................Section 2.1...................................11
Owned Properties .................................................Section 4.13(a)(i)............................37
Owner Property Owners.............................................Section 2.1...................................11
PBGC .............................................................Section 4.8(d)................................31
Per Share Casden Jenior Preferred Liquidation Amount .............Section 4.13(a)(i).............................37
Permitted Encumbrances ...........................................Section 4.13(a)................................38
Person ...........................................................Section 2.1....................................11
PLB ..............................................................Recitals........................................2
Proposed Transferred Employees....................................Section 4.8(s).................................34
Qualified REIT Subsidiary.........................................Section 4.1(c).................................21
Questionnaires....................................................Section 2.1....................................10
Registration Rights Agreement (Stock).............................Recitals........................................4
Registration Rights Agreement (Units).............................Recitals........................................4
Registration Statement ...........................................Section 2.1....................................11
REIT .............................................................Recitals........................................5
REIT Cash Consideration...........................................Section 2.1....................................11
REIT Common Consideration ........................................Section 2.1....................................12
REIT Common Deferred Consideration................................Section 2.1....................................12
REIT Merger Consideration.........................................Section 2.1....................................12
REIT Preferred Consideration......................................Section 2.1....................................12
Related Transaction Documents ....................................Section 2.1....................................12
Related Transactions .............................................Section 2.1....................................12
Release ..........................................................Section 7.22...................................63
Representatives ..................................................Section 7.1...................................56
Ross Purchase Agreement...........................................Recitals........................................3
Ross Retail LLC ..................................................Recitals........................................3
Ross Store Sale...................................................Recitals........................................3
SEC ..............................................................Section 2.1....................................12
Securities Act ...................................................Section 2.1....................................12
Spin-Off..........................................................Recitals........................................2
Status Requirements ..............................................Section 4.7(f).................................28
Subsidiary .......................................................Section 2.1....................................12
Surviving Corporation ............................................Section 1.1.....................................5
Tax Indemnity Agreement ..........................................Recitals........................................3
Tax Questionnaires-NAPICO.........................................Section 2.1....................................10
Tax Questionnaires-Subsidiaries...................................Section 2.1....................................10
Tax Return .......................................................Section 2.1....................................13
Tax Ruling .......................................................Section 2.1....................................13
Taxable Election..................................................Section 2.2(f).................................16
Taxable REIT Subsidiary...........................................Section 4.1(c).................................21
Taxes ............................................................Section 2.1....................................13
Termination Date .................................................Section 9.1(c).................................70
Test Date.........................................................Section 2.2(f).................................16
Total Consideration...............................................Section 2.2(d).................................15
Trademarks .......................................................Section 7.16(a)................................62
Transaction Documents ............................................Section 2.1....................................13
Transactions .....................................................Section 2.1....................................13
Transfer Taxes ...................................................Section 7.15...................................61
Transferred Employees.............................................Section 7.11(a)................................60
Transition Period ................................................Section 7.16(c)................................62
Tri-Party Agreement ..............................................Recitals........................................2
Villa Azure Earnout Amount .......................................Section 2.1....................................13
Villa Azure Letter Agreement......................................Recitals........................................2
Villa Azure Property .............................................Section 2.1....................................13
Violation ........................................................Section 4.3(b).................................24
Voting Agreement .................................................Recitals........................................3
Voting Debt ......................................................Section 4.2(a).................................23
WARN Act .........................................................Section 2.1....................................13
Westwood..........................................................Recitals........................................2
WW Letter Agreement...............................................Recitals........................................2
XYZ ..............................................................Preamble........................................1
XYZ Agreement.....................................................Section 2.1....................................13





                        AGREEMENT AND PLAN OF MERGER

         THIS AGREEMENT AND PLAN OF MERGER (this "Agreement") is made and
entered into as of December 3, 2001, by and between Apartment Investment
and Management Company, a Maryland corporation ("AIMCO"), Casden Properties
Inc., a Maryland corporation ("Casden"), and XYZ Holdings LLC, a Delaware
limited liability company ("XYZ").

         WHEREAS, the respective boards of directors of AIMCO and Casden
deem it advisable and in the best interests of their respective
stockholders that AIMCO acquire Casden in a merger (the "Merger"), upon the
terms and subject to the conditions set forth in this Agreement;

         WHEREAS, pursuant to this Agreement, AIMCO shall acquire Casden
REIT, and pursuant to the OP Unit Contribution Agreement (as defined
herein), the CPLB Merger Agreement (as defined herein) and the Casden
Contribution Agreement (as defined herein), AIMCO shall acquire certain
affiliated entities, all in exchange for the Aggregate Consideration;

         WHEREAS, immediately prior to the Closing Date (as defined in
Section 3.1), Casden shall effect a reverse stock split with respect to the
Casden Common Stock, whereby every 100 shares of Casden Common Stock will
represent one share of Casden Common Stock after giving effect thereto (the
"Casden Reverse Stock Split");

         WHEREAS, immediately prior to the Closing Date, Casden Park La
Brea, Inc., a Maryland corporation ("CPLB"), shall effect a reverse stock
split with respect to its common stock, whereby every 10 shares of CPLB
common stock will represent one share of CPLB common stock after giving
effect thereto (the "CPLB Reverse Stock Split");

         WHEREAS, upon the terms and subject to the conditions set forth
herein, AIMCO and Casden shall execute Articles of Merger ("Articles of
Merger") and shall file such Articles of Merger in accordance with Maryland
law to effectuate the Merger;

         WHEREAS, Casden and AIMCO desire that, on or prior to the
Contribution Effective Date, holders of limited partnership interests in
Casden Properties Operating Partnership, L.P., a Delaware limited
partnership ("Casden OP"), will exchange such limited partnership interests
("Casden OPUs") for cash and limited partnership interests in AIMCO
Properties, L.P., a Delaware limited partnership ("AIMCO OP"), on the terms
and subject to the conditions of an OP Unit Contribution Agreement, dated
as of December 3, 2001 and attached hereto as Exhibit A (the "OP
Contribution Agreement"), by and among the holders of Casden OPUs, Casden,
Casden OP and AIMCO OP (the "OP Contribution");

         WHEREAS, Casden and AIMCO desire that, on or prior to the
Contribution Effective Date, (i) Alan I. Casden ("AIC") will contribute all
of his interests in AIC REIT Properties LLC, a Delaware limited liability
company ("ARP"), and (ii) Casden Investment Corp., a California corporation
("CIC"), will contribute all of its interests in NAPICO (as defined in
Section 4.1(e)) to AIMCO OP in exchange for cash and/or limited partnership
interests in AIMCO OP, on the terms and subject to the conditions of a
Contribution Agreement, dated as of the date hereof and attached hereto as
Exhibit B-1 (the "Casden Contribution Agreement"), by and among ARP, AIC,
CIC and AIMCO OP;

         WHEREAS, Casden and AIMCO desire that, on or prior to the
Contribution Effective Date, certain commercial real estate properties of
Casden (the "Commercial Properties") either (i) shall be sold to, and
certain indebtedness of Casden relating to such Commercial Properties (the
"Commercial Debt") shall be assumed by, one or more entities pursuant to an
asset purchase agreement substantially in the form attached hereto as
Exhibit B-2 or (ii) any Commercial Debt and the interests in the limited
liability companies that own the Commercial Properties shall be distributed
by Casden to its stockholders in a spin-off transaction (the "Spin-Off")
(collectively, such entity or entities referred to herein as "CommercialCo"
and such transaction(s), including the Spin-Off, referred to herein as the
"Commercial Sale");

         WHEREAS, Casden and AIMCO desire that, on the Closing Date, AIMCO
acquire 100% of the ownership interest in certain real estate properties
currently under development and commonly referred to as the "PLB" and
"Westwood" developments (the "Development Properties"), subject to
compliance with the terms and conditions of the Tri-Party and Construction
Completion Agreement, by and among XYZ, AIMCO, Development LLC, AIMCO OP,
Casden Park La Brea A LLC, Casden Park La Brea B LLC, Casden Park La Brea C
LLC, Casden Glendon, LLC and the agent for the construction lenders named
therein, substantially in the form attached hereto as Exhibit C-1 (the
"Tri-Party Agreement"), subject to Section 7.9, providing for, among other
things, the financing, development and completion of the construction of
the Development Properties;

         WHEREAS, XYZ and AIMCO desire that, concurrently with the
execution of the Tri-Party Agreement, AIMCO and XYZ shall execute and
deliver a letter agreement relating to the "Westwood" Development Property,
substantially in the form attached hereto as Exhibit C-2 (the "WW Letter
Agreement");

         WHEREAS, Casden and AIMCO desire that on the Closing Date, AIMCO
shall execute and deliver, and Casden shall cause The Casden Company to
execute and deliver, a letter agreement relating to the Villa Azure
Property (as defined herein), substantially in the form attached hereto as
Exhibit C-3 (the "Villa Azure Letter Agreement");

         WHEREAS, on or prior to the date of the OP Contribution, Casden
shall cause Casden OP to distribute to Casden its entire interest in CPLB;

         WHEREAS, immediately after the Effective Time (as defined in
Section 1.3), a wholly-owned subsidiary of AIMCO ("AIMCO CPLB Merger Sub")
will be merged with and into CPLB (the "CPLB Merger"), pursuant to an
Agreement and Plan of Merger, dated as of December 3, 2001 (the "CPLB
Merger Agreement"), by and among AIMCO, CPLB, AIMCO CPLB Merger Sub and XYZ
and attached hereto as Exhibit D;

         WHEREAS, AIMCO and certain Casden stockholders desire to enter
into a joint venture with respect to the development of real estate
properties (the "Joint Venture"), and for such purpose AIMCO and certain
Casden stockholders shall contribute cash and certain other assets (the
"Development LLC Assets") to a newly formed limited liability company
("Development LLC"), on the terms and subject to the conditions of a
limited liability company agreement substantially in the form attached
hereto as Exhibit E-1 (the "Development LLC Agreement");

         WHEREAS, Casden and AIMCO desire that, on or prior to the
Contribution Effective Date, either (i) Casden Park La Brea LLC, a Delaware
limited liability company ("CPLB LLC"), shall sell all of the issued and
outstanding ownership interests of Casden Park La Brea Retail LLC, a
Delaware limited liability company ("Ross Retail LLC"), to Development LLC,
on the terms and subject to the conditions of a purchase agreement (the
"Ross Purchase Agreement"), substantially in the form attached hereto as
Exhibit E-2 or (ii) the limited liability company interests in Ross Retail
LLC shall be distributed to the stockholders of CPLB in a spin-off
transaction (the transactions described in clauses (i) and (ii) above being
referred to herein, collectively, as the "Ross Store Sale");

         WHEREAS, Casden and AIMCO desire that, on or prior to the
Contribution Effective Date, Casden shall sell certain assets it owns,
together with all development rights that it acquires after the date
hereof, to Development LLC (the "Asset Purchase"), on the terms and subject
to the conditions of an asset purchase agreement (the "Development LLC
Purchase Agreement") substantially in the form attached hereto as Exhibit
E-3;

         WHEREAS, concurrently with the execution of this Agreement and as
an inducement to AIMCO and Casden to enter into this Agreement, the
following parties have entered into the following agreements (each of even
date herewith):

                  (i) certain of the holders of Casden OPUs, Casden, Casden
         OP and AIMCO OP have entered into the OP Contribution Agreement;

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