<SUBMISSION>
<ACCESSION-NUMBER>0000950123-04-001009
<TYPE>8-K
<PUBLIC-DOCUMENT-COUNT>3
<PERIOD>20040127
<ITEMS>2
<ITEMS>7
<FILING-DATE>20040129
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>LENNAR CORP /NEW/
<CIK>0000920760
<ASSIGNED-SIC>1520
<IRS-NUMBER>954337490
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1130
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>8-K
<ACT>34
<FILE-NUMBER>001-11749
<FILM-NUMBER>04552257
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>700 NW 107TH AVENUE
<STREET2>SUITE 400
<CITY>MIAMI
<STATE>FL
<ZIP>33172
<PHONE>3055594000
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>700 NW 107TH AVENUE
<STREET2>SUITE 400
<CITY>MIAMI
<STATE>FL
<ZIP>33172
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>PACIFIC GREYSTONE CORP /DE/
<DATE-CHANGED>19940323
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>y93462e8vk.htm
<DESCRIPTION>LENNAR CORPORATION
<TEXT>
<HTML>
<HEAD>
<TITLE>LENNAR CORPORATION</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>UNITED STATES<BR>
SECURITIES AND EXCHANGE COMMISSION</B></FONT>

<DIV align="center"><FONT size="3"><B>WASHINGTON, D.C. 20549</B>
</FONT></DIV>


<P align="center"><HR align="center" size="1" noshade width="25%">

<P align="center"><FONT size="5"><B>FORM 8-K</B></FONT>


<P align="center"><FONT size="2"><B>CURRENT REPORT<BR>
PURSUANT TO SECTION 13 OR 15(d) OF THE<BR>
SECURITIES EXCHANGE ACT OF 1934</B>
</FONT>


<P align="center"><FONT size="2">January&nbsp;27, 2004
</FONT>

<DIV align="center"><FONT size="2"><HR align="center" size="1" noshade width="20%">
Date of Report (Date of earliest event reported)
</FONT>
</DIV>

<P align="center"><FONT size="6"><B>LENNAR CORPORATION</B></FONT>

<DIV align="center"><FONT size="2"><HR align="center" size="1" noshade width="75%">
(Exact Name of Registrant as Specified in its Charter)
</FONT>
</DIV>

<DIV align="center">
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><FONT size="2"><B>Delaware</B></FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2">
<B>1 &#151; 11749</B>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><B>95 &#151; 4337490</B></FONT></TD>
</TR>
<TR>
    <TD align="center" valign="top"><HR size="1" noshade></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2">
<HR size="1" noshade>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><FONT size="2">(State of Incorporation)</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2">
(Commission File Number)
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2">(IRS Employer Identification No.)</FONT></TD>
</TR>
</TABLE>
</DIV>


<P align="center"><FONT size="2"><B>700 Northwest 107</B><B><SUP>th</SUP> Avenue<BR>
Miami, Florida<BR>
33172</B><BR>
(Address of Registrant&#146;s Principal Executive Office) (Zip Code)
</FONT>


<P align="center"><FONT size="2"><B>(305)&nbsp;559-4000</B>
</FONT>

<DIV align="center"><FONT size="2"><HR align="center" size="1" noshade width="25%">
(Registrant&#146;s Telephone Number, Including Area Code)
</FONT>
</DIV>



<P align="center"><FONT size="2">&nbsp;
</FONT>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<!-- link2 "Item&nbsp;2. Acquisition or Disposition of Assets." -->
<DIV align="left"><A NAME="000"></A></DIV>

<P align="left"><FONT size="2"><B>Item&nbsp;2. Acquisition or Disposition of Assets.</B>
</FONT>

<P align="left"><FONT size="2">On January&nbsp;27, 2004, NWHL Investment LLC (&#147;NWHL&#148;), which is 50% owned by
Lennar Corporation and 50% owned by LNR Property Corporation, acquired The
Newhall Land and Farming Company (&#147;Newhall Land&#148;) by merging a wholly owned
subsidiary of NWHL into Newhall Land in a transaction in which NWHL and a
wholly owned subsidiary became the sole members of Newhall Land and Newhall
Land unitholders received, for each Newhall Land unit they owned, $40.50 per
unit in cash. The payments to Newhall Land unitholders (including payments for
options that had not yet been exercised) totaled approximately
$1&nbsp;billion.
</FONT>

<P align="left"><FONT size="2">At the same time that NWHL acquired
Newhall Land, the venture sold a group of income producing properties
to LNR for approximately $217&nbsp;million and Lennar agreed to
purchase 687 homesites, and obtained options to purchase 623
homesites, from the venture.</FONT>

<!-- link2 "Item&nbsp;7. Financial Statements, Pro Forma Financial Information and Exhibits." -->
<DIV align="left"><A NAME="001"></A></DIV>

<P align="left"><FONT size="2">Item&nbsp;7. Financial Statements, Pro Forma Financial Information and Exhibits.
</FONT>


<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;<I>Financial Statements of Businesses Acquired.</I>
</FONT>


<P align="left" style="margin-left:3%; margin-right:0%"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Not Applicable
</FONT>


<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;<I>Pro Forma Financial Information.</I>
</FONT>


<P align="left" style="margin-left:3%; margin-right:0%"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Not Applicable
</FONT>


<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;<I>Exhibits.</I>
</FONT>


<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1&nbsp;&nbsp;&nbsp;Agreement and Plan of Merger by and among The Newhall Land and Farming
Company, Lennar Corporation, LNR Property<BR>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Corporation, NWHL Investment LLC and
NWHL Acquisition, L.P. dated as of July&nbsp;21, 2003.
</FONT>


<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;99.1&nbsp;&nbsp;&nbsp;Press
Release dated January&nbsp;27, 2004.
</FONT>



<P align="center"><FONT size="2">2
</FONT>

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<!-- link1 "SIGNATURES" -->

<P align="center"><FONT size="2"><B>SIGNATURES</B>
</FONT>


<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
</FONT>

<DIV align="center">
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="50%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="18%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="5" valign="top" align="left"><FONT size="2">LENNAR CORPORATION</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
By:</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;&nbsp;&nbsp;/s/&nbsp;Bruce E. Gross</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2"><HR align="left" size="1" noshade width="100%">
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>

<TD align="left" valign="top"><FONT size="2">&nbsp;&nbsp;&nbsp;Name:
Bruce E. Gross</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>

<TD align="left" valign="top"><FONT size="2">&nbsp;&nbsp;&nbsp;Title:
Vice President &amp; Chief &nbsp;&nbsp;&nbsp;Financial Officer</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
</DIV>


<P align="left"><FONT size="2">Date: January&nbsp;29, 2004
</FONT>

<!-- link1 "EXHIBIT INDEX" -->

<P align="center"><FONT size="2"><B>EXHIBIT INDEX</B>
</FONT>

<DIV align="center">
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="8%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="87%">&nbsp;</TD>
</TR>
<TR  valign="bottom">
    <TD nowrap align="left"><FONT size="1"><B>Exhibit No.</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center"><FONT size="1"><B>Exhibit</B></FONT></TD>
</TR>
<TR  valign="bottom">
    <TD nowrap align="left"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">2.1</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Agreement and Plan of Merger by and among The Newhall Land and Farming
Company, Lennar Corporation, LNR Property Corporation, NWHL Investment LLC
and NWHL Acquisition, L.P. dated as of July&nbsp;21, 2003.</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">99.1</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Press Release, dated January&nbsp;27, 2004</FONT></TD>
</TR>
</TABLE>
</DIV>




<P align="center"><FONT size="2">3
</FONT>


</BODY>
</HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-2.1
<SEQUENCE>3
<FILENAME>y93462exv2w1.htm
<DESCRIPTION>AGREEMENT AND PLAN OF MERGER
<TEXT>
<HTML>
<HEAD>
<TITLE>AGREEMENT AND PLAN OF MERGER</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="right"><FONT size="2"><B>EXECUTION COPY</B></FONT>
<P>
<HR size="4" noshade color="#000000" style="margin-top: -5px">
<HR size="1" noshade color="#000000" style="margin-top: -10px">




<P align="center"><FONT size="2"><B>AGREEMENT AND PLAN OF MERGER</B>
</FONT>

<P align="center"><FONT size="2"><B>by and among</B>
</FONT>

<P align="center"><FONT size="2"><B>THE NEWHALL LAND AND FARMING COMPANY,</B>
</FONT>

<P align="center"><FONT size="2"><B>LENNAR CORPORATION,</B>
</FONT>

<P align="center"><FONT size="2"><B>LNR PROPERTY CORPORATION,</B>
</FONT>

<P align="center"><FONT size="2"><B>NWHL INVESTMENT LLC,</B>
</FONT>

<P align="center"><FONT size="2"><B>and</B>
</FONT>

<P align="center"><FONT size="2"><B>NWHL ACQUISITION, L.P.</B>
</FONT>

<P align="center"><FONT size="2"><B>Dated as of</B>
</FONT>

<P align="center"><FONT size="2"><B>July&nbsp;21, 2003</B>
</FONT>

<P>
<HR size="1" noshade color="#000000" style="margin-top: -2px">
<HR size="4" noshade color="#000000" style="margin-top: -10px">




<P align="center"><FONT size="2">&nbsp;</FONT>
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>







<P align="center"><FONT size="2">TABLE OF CONTENTS
</FONT>

<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="85%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Page</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
    <TD colspan="3" valign="top" align="center"><FONT size="2">ARTICLE 1</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">MERGER OF ACQUISITION AND THE COMPANY</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">1.1</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">The Merger</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">1.2</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Certificate of Limited Partnership</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">1.3</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Limited Partnership Agreement</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">1.4</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">General Partner</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">1.5</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Limited Partner</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">1.6</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Further Assurances</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">1.7</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Units of Interest in the Company</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">3</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">1.8</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Units of Interest in Acquisition</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">3</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">1.9</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Deposit</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">3</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">1.10</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Adjustments</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">4</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">1.11</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Distributions with Regard to Company Interests</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">4</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">1.12</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Determinations Regarding Documents</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">5</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">1.13</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Equity Awards</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">6</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">1.14</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Withholding</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">6</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD colspan="3" valign="top" align="center"><FONT size="2">ARTICLE 2</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">EFFECTIVE TIME OF MERGER</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">6</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">2.1</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Date of the Merger</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">6</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">2.2</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Execution of Certificate of Merger</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">7</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">2.3</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Effective Time of the Merger</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">7</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD colspan="3" valign="top" align="center"><FONT size="2">ARTICLE 3</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">REPRESENTATIONS AND WARRANTIES OF THE COMPANY</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">7</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.1</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Organization and Authorization, Validity of Agreement, Company Action</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">7</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.2</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">No Conflicts</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">7</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.3</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">No Violations</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">8</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.4</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Qualification</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">9</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.5</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Capitalization</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">9</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.6</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Subsidiaries</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">9</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.7</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Reports and Financial Statements</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">10</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.8</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Assets</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">10</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.9</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Compliance with Law; Permits</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">10</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.10</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Tax Matters</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">10</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">-i-</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>


<P align="center"><FONT size="2">TABLE OF CONTENTS<BR>
(continued)
</FONT>

<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="84%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Page</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.11</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Environmental Matters</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">11</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.12</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Opinion of Financial Advisor</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">12</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.13</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Litigation</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">12</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.14</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Section&nbsp;280G</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">12</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.15</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Affiliate Transactions</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">12</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.16</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">ERISA Matters</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">13</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.17</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Brokers or Finders</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">14</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.18</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Material Contracts</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">14</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">3.19</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Conduct of Business</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">15</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD colspan="3" valign="top" align="center"><FONT size="2">ARTICLE 4</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="1"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">REPRESENTATIONS AND WARRANTIES OF LIMA, PARENT AND ACQUISITION</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">15</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">4.1</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Organization</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">15</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">4.2</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Authorization</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">15</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">4.3</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">No Violations</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">15</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>


<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">4.4</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Consents; Approval</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">16</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">4.5</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Brokers or Finders</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">16</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD colspan="3" valign="top" align="center"><FONT size="2">ARTICLE 5</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">COVENANTS</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">16</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">5.1</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Due Diligence Period</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">16</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">5.2</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Company&#146;s Activities Until Effective Time</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">20</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">5.3</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Parent&#146;s, Acquisition&#146;s and Lima&#146;s Activities Until Effective Time</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">22</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">5.4</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Regulatory Filings; Securities Filings</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">22</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">5.5</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Unitholders&#146; Action</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">23</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">5.6</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Proxy Statement</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">23</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">5.7</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">No Solicitation of Offers; Notice of Proposals from Others</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">24</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">5.8</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Company Financial Information</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">25</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">5.9</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Company Disclosure Letter</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">26</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD colspan="3" valign="top" align="center"><FONT size="2">ARTICLE 6</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">CONDITIONS</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">26</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">6.1</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Conditions to the Company&#146;s Obligations</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">26</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">6.2</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Conditions to Parent&#146;s, Lima&#146;s and Acquisition&#146;s Obligations</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">26</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">6.3</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Conditions to the Parties&#146; Obligations</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">27</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">-ii-
</FONT>


<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>



<P align="center"><FONT size="2">TABLE OF CONTENTS<BR>
(continued)
</FONT>

<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="80%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Page</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" valign="top" align="center"><FONT size="2">ARTICLE 7</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">TERMINATION</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">28</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">7.1</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Right to Terminate</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">28</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">7.2</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Manner of Terminating Agreement</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">30</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">7.3</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Effect of Termination</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">30</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">7.4</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Survival</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">30</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD colspan="3" valign="top" align="center"><FONT size="2">ARTICLE 8</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">OTHER AGREEMENTS</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">31</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">8.1</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Liquidated Damages</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">31</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">8.2</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Other Actions; Filings; Consents</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">33</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">8.3</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Notification of Certain Matters</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">34</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">8.4</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Post-Closing Tax Matters</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">34</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD colspan="3" valign="top" align="center"><FONT size="2">ARTICLE 9</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">GENERAL</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">35</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.1</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Expenses</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">35</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.2</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Employee Benefit Plans</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">35</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.3</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Insurance and Indemnification</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">36</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.4</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Benefit of Provisions</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">37</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.5</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Access to Properties, Books and Records</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">37</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.6</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Press Releases; Tax Matters Disclosure</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">37</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.7</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Entire Agreement</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">38</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.8</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Interpretation</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">38</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.9</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Prohibition Against Assignment</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">39</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.10</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Intentional Failure to Perform Obligations;
Termination Post 270 Days after Date of this Agreement</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">39</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.11</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Notices and Other Communications</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">40</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

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    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.12</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Governing Law</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">41</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

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    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.13</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Amendments</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">41</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.14</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Counterparts</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">41</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

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    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.15</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Assignability; Parties in Interest</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">41</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

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    <TD valign="top" align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top" align="right"><FONT size="2">9.16</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Joint and Several Obligation of Lima</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">42</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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<P align="center"><FONT size="2">-iii-</FONT>
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<P align="center"><FONT size="2">TABLE OF CONTENTS<BR>
(continued)
</FONT>






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    <TD colspan="6" valign="top" align="left"><FONT size="2">Exhibit&nbsp;A &#150; Voting Agreement</FONT></TD>

    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD colspan="6" valign="top" align="left"><FONT size="2">Exhibit&nbsp;B &#150; Escrow Agreement</FONT></TD>

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<P align="center"><FONT size="2">-iv-</FONT>
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<P align="right"><FONT size="2"><B>EXECUTION COPY</B></FONT>

<P align="center"><FONT size="2"><B>AGREEMENT AND PLAN OF MERGER</B>
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AGREEMENT AND PLAN OF MERGER, dated as of July&nbsp;21, 2003 (this
&#147;Agreement&#148;), by and among The Newhall Land and Farming Company, a California
limited partnership (the &#147;Company&#148;), Lennar Corporation, a Delaware
corporation, and LNR Property Corporation, a Delaware corporation
(collectively, &#147;Lima&#148;), NWHL Investment LLC, a Delaware limited liability
company, a directly or indirectly owned subsidiary of Lima (&#147;Parent&#148;), and NWHL
Acquisition, L.P., a California limited partnership (&#147;Acquisition&#148;).
</FONT>
<P align="center"><FONT size="2">RECITALS
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The board of directors, board of managers, general partner or general
partners, as the case may be, of each of Lima, Parent, Acquisition and the
Company have approved, and deem it fair, advisable and in the best interests of
each respective corporation, limited liability company or limited partnership
and its shareholders, members or limited partners, as the case may be, to
consummate the acquisition of the Company by Parent through the merger of
Acquisition with and into the Company upon the terms and subject to the
conditions set forth in this Agreement (the &#147;Merger&#148;).
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The respective general partner or general partners of each of Acquisition
and the Company have unanimously approved the Merger and the principal terms of
this Agreement in accordance with the California Revised Limited Partnership
Act (the &#147;RLPA&#148;) and the respective board of directors or members of each of
Lima and Parent have approved the Merger and the Agreement.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The general partners of the Company have determined that this Agreement is
advisable, and that the consideration to be paid for each Unit (as defined in
Section&nbsp;1.7) in the Merger is fair to the holders of such Units, and have
resolved to recommend that the holders of such Units approve the principal
terms of the Merger on the terms and subject to the conditions set forth in
this Agreement.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As a condition and inducement to each party&#146;s entering into this Agreement
and incurring the obligations set forth herein, (i)&nbsp;certain unitholders of the
Company, concurrently with the execution and delivery of this Agreement, are
entering into a voting agreement, substantially in the form attached to this
Agreement as Exhibit&nbsp;A (the &#147;Voting Agreement&#148;), and (ii)&nbsp;Parent is delivering
to the Company cash in the amount of $5.0&nbsp;million.
</FONT>
<P align="center"><FONT size="2">AGREEMENT
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In consideration of the foregoing and the mutual representations,
warranties and covenants in this Agreement, the parties hereto, intending to be
legally bound, agree as follows:
</FONT>
<P align="center"><FONT size="2">- 1 -</FONT>
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<P align="center"><FONT size="2"><B>ARTICLE 1<BR>
MERGER OF ACQUISITION AND THE COMPANY</B>
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 The Merger. Upon the terms and subject to the conditions set forth in
this Agreement, and in accordance with the RLPA, at the Effective Time (as
defined in Section&nbsp;2.3), Acquisition will be merged with and into the Company,
which will be the surviving limited partnership in the Merger (the &#147;Surviving
Partnership&#148;). Except as specifically provided in this Agreement, when the
Merger becomes effective, (a)&nbsp;the real and personal property, other assets,
rights, privileges, immunities, powers, purposes and franchises of the Company
will continue as those of the Surviving Partnership, unaffected and unimpaired
by the Merger, (b)&nbsp;the separate existence of Acquisition will terminate, and
Acquisition&#146;s real and personal property, other assets, rights, privileges,
immunities, powers, purposes and franchises will be merged into the Surviving
Partnership, which will succeed to and assume all the rights and obligations of
Acquisition in accordance with the RLPA, and (c)&nbsp;the Merger will have the other
effects specified in the RLPA (including Section&nbsp;15678.6 of the RLPA).
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2 Certificate of Limited Partnership. The certificate of limited
partnership of the Company immediately before the Effective Time will be
amended in its entirety to be identical to the certificate of limited
partnership of Acquisition immediately before the Effective Time and shall be
the certificate of limited partnership of Surviving Partnership from the
Effective Time until subsequently amended in accordance with applicable law.
The certificate of limited partnership of Company, as so amended, separate and
apart from this Agreement, may be certified as the certificate of limited
partnership of the Surviving Partnership.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3 Limited Partnership Agreement. The limited partnership agreement of
the Company immediately before the Effective Time will be amended in its
entirety to be identical to the limited partnership agreement of Acquisition
immediately before the Effective Time and shall be the limited partnership
agreement of the Surviving Partnership from the Effective Time until it is
amended in accordance with its terms and applicable law.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4 General Partner. NWHL GP LLC, a Delaware limited liability company, a
wholly owned subsidiary of Parent (&#147;Acquisition General Partner&#148;), as the sole
general partner of Acquisition immediately prior to the Effective Time, will be
the sole general partner of the Surviving Partnership after the Effective Time
and will serve in accordance with the limited partnership agreement of the
Surviving Partnership until its withdrawal or removal in accordance with the
terms of the limited partnership agreement of the Surviving Partnership.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.5 Limited Partner. Parent, the sole limited partner of Acquisition
immediately prior to the Effective Time, will be the sole limited partner of
the Surviving Partnership after the Effective Time.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.6 Further Assurances. If at any time after the Effective Time, the
Surviving Partnership determines or is advised that any deeds, bills of sale,
assignments, assurances or other actions or things are necessary or desirable
to vest, perfect or confirm of record or otherwise in the Surviving Partnership
its right, obligation, title or interest in, to or under any of the rights,
properties or assets of either the Company or Acquisition acquired or to be
acquired by the Surviving Partnership as a result of, or in connection with,
the Merger or otherwise to
</FONT>
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<P align="left"><FONT size="2">carry out the transactions which are the subject of this Agreement, the
general partner of the Surviving Partnership will be authorized to execute and
deliver all documents, in the name and behalf of the Company, Acquisition or
otherwise, and to take all other actions and do all other things as may be
necessary or desirable to vest, perfect or confirm any and all right,
obligation, title and interest in, to and under such rights, properties or
assets in the Surviving Partnership or otherwise to carry out the transactions
contemplated by this Agreement.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.7 Units of Interest in the Company.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;At the Effective Time, each depositary unit of limited partnership
interest in the Company (each, a &#147;Unit&#148;), including Units owned by the General
Partners (as defined in Section&nbsp;3.1), which is outstanding immediately before
the Effective Time will be converted into and become the right to receive (i)
$40.50 in cash, without interest, plus (ii)&nbsp;an amount in cash equal to the
product of (A) $40.50, multiplied by (B)&nbsp;5% multiplied by (C)&nbsp;the fraction
obtained by dividing (1)&nbsp;the total number of days elapsed between (x)&nbsp;the date
that is 270&nbsp;days after the date that a public announcement is first jointly
made by the parties with respect to the proposed Merger and (y)&nbsp;the Merger
Date, by (2)&nbsp;365, (the sum of (i)&nbsp;and (ii)&nbsp;above, net of and reduced by
applicable Tax (as defined in Section&nbsp;3.10) withholding, being referred to as
the &#147;Merger Consideration&#148;). From and after the Effective Time, a depositary
receipt which represented a Unit will represent only the right to receive the
Merger Consideration.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;At the Effective Time, each general partnership interest in the
Company which is outstanding immediately before the Effective Time will be
converted into and become the right to receive the Merger Consideration. From
and after the Effective Time, any certificate which represented any general
partnership interest in the Company will represent only the right to receive
the Merger Consideration. The parties acknowledge that each general
partnership interest in the Company is represented by a unit (a &#147;GP Unit&#148;)
which represents the same economic interest in the Company as a Unit;
accordingly, for purposes of paying the Merger Consideration, each GP Unit
shall be considered to be a Unit.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;Concurrently with the execution of this Agreement, the holders of
Units listed in Section&nbsp;1.7 of the Company Disclosure Letter (as defined in
Article&nbsp;3), who hold in the aggregate 12.13% of the Units outstanding on the
date of this Agreement, delivered Voting Agreements to Parent.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.8 Units of Interest in Acquisition. At the Effective Time, each unit of
limited partnership interest in Acquisition (each, an &#147;Acquisition Unit&#148;) which
is outstanding immediately before the Effective Time will remain outstanding
and will become one limited partnership unit of the Surviving Partnership.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.9 Deposit. Concurrently with the execution and delivery of this
Agreement, Lima is delivering to the Company cash in the amount of $5.0&nbsp;million
(the &#147;Initial Deposit Amount&#148;). In the event this Agreement has not been
terminated by Parent pursuant to Section&nbsp;7.1(c) or otherwise terminated
pursuant to Article&nbsp;VII prior to the Due Diligence Termination Date (as defined
in Section&nbsp;3.3), (i)&nbsp;Lima, Parent, the Company and Wells Fargo Bank, N.A. (the
&#147;Escrow Agent&#148;) shall, on or prior to the Due Diligence Termination Date,
execute an Escrow Agreement substantially in the form attached hereto as
Exhibit&nbsp;B, subject to any changes that may be
</FONT>
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<P align="left"><FONT size="2">required by the Escrow Agent (the &#147;Escrow Agreement&#148;), and (ii)&nbsp;Lima shall
(or shall cause Parent to), on the first business day after the Due Diligence
Termination Date, deliver to the Escrow Agent cash in the amount of $25.0
million (the &#147;Additional Deposit Amount&#148;) to be held by the Escrow Agent in
escrow pursuant to the terms of the Escrow Agreement. In the event that this
Agreement has not been terminated pursuant to Article&nbsp;VII on or prior to the
date of the Company Meeting (as defined in Section&nbsp;5.5) and the principal terms
of the Merger are approved by the holders of the majority of the Units entitled
to vote on the matter at the Company Meeting, Lima shall (or shall cause Parent
to), on the first business day after the Company Meeting, cause the Escrow
Agent to deliver the Additional Deposit Amount to the Company pursuant to the
terms of the Escrow Agreement. The Initial Deposit Amount and all amounts held
in escrow at any time (including the Additional Deposit Amount together with
interest earned thereon while held by the Escrow Agent) shall be referred to in
this Agreement as the &#147;Escrow Fund&#148;).
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.10 Adjustments. If between the date of this Agreement and the Effective
Time, the outstanding Units or GP Units are changed into a different number of
Units or GP Units by reason of a reclassification, recapitalization, split up,
combination or exchange of Units or GP Units that has a record date between the
date of this Agreement and the Effective Time, the Merger Consideration will be
adjusted to provide the holders of the Units (the &#147;Unitholders&#148;) and the
holders of the GP Units (&#147;GP Holders&#148;) the same economic effect as that
contemplated by this Agreement if the reclassification, recapitalization,
split-up, combination, or exchange had not taken place.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.11 Distributions with Regard to Company Interests.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Prior to the Effective Time, Parent and the Company will jointly
designate a bank or trust company to act as distributing agent in connection
with the Merger (the &#147;Distributing Agent&#148;). Immediately before the Effective
Time, (i)&nbsp;the Company will wire transfer the Escrow Fund (excluding interest)
to the Distributing Agent and (ii)&nbsp;Lima will (or will cause Parent to) provide
the Distributing Agent with the balance of the Merger Consideration, after
taking into account the Escrow Fund, which will have to be distributed to
Unitholders and GP Holders under Section&nbsp;1.11(c).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;While the Distributing Agent is holding funds provided by Lima or
Parent under Section&nbsp;1.11(a), the Distributing Agent will invest the funds, as
directed by Parent, in obligations of or guaranteed by the United States of
America or obligations of an agency of the United States of America which are
backed by the full faith and credit of the United States of America, in
commercial paper obligations rated A-1 or P-1 or better by Moody&#146;s Investors
Services Inc. or Standard &#038; Poors&#146; Corporation, or in deposit accounts,
certificates of deposit or banker&#146;s acceptances of, repurchase or reverse
repurchase agreements with, or Eurodollar time deposits purchased from,
commercial banks with capital, surplus and undivided profits aggregating more
than $500&nbsp;million (based on the most recent financial statements of the banks
which are then publicly available at the Securities and Exchange Commission
(&#147;SEC&#148;) or otherwise); <I>provided </I>that any losses on such investment will not
reduce any Unitholder&#146;s right or GP Holder&#146;s right to Merger Consideration.
</FONT>



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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;Promptly after the Effective Time, Lima or Parent will cause the
Distributing Agent to mail to each person who was a Unitholder of record or GP
Holder of record at the Effective Time, a letter of transmittal (in a form
which will have been approved by counsel to the Company prior to the Effective
Time, which approval shall not be unreasonably withheld) for use in effecting
the surrender of depositary receipts representing Units or certificates
representing GP Units (such depository receipts and certificates being referred
to herein as &#147;Certificates&#148;), in order to receive payment of the Merger
Consideration. When the Distributing Agent receives a Certificate, together
with a properly completed and executed letter of transmittal and any other
required documents, the Distributing Agent will distribute to the holder of the
Certificate, or as otherwise directed in the letter of transmittal, the Merger
Consideration with regard to the Units or GP Units represented by the
Certificate, and the Certificate will be canceled. No interest will be paid or
accrued on the cash payable upon the surrender of Certificates. If payment is
to be made to a person other than the person in whose name a surrendered
Certificate is registered, the surrendered Certificate must be properly
endorsed or otherwise be in proper form for transfer, and the person who
surrenders the Certificate must provide funds for payment of any transfer or
other taxes required by reason of the distribution to a person other than the
registered holder of the surrendered Certificate or establish to the
satisfaction of the Surviving Partnership that the tax has been paid. After
the Effective Time, a Certificate which has not been surrendered will represent
only the right to receive the Merger Consideration, without any interest.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;If a Certificate has been lost, stolen or destroyed, Lima or Parent
will accept (and will cause the Distributing Agent to accept) an affidavit and
indemnification or bond reasonably satisfactory to it instead of the
Certificate and will cause the Merger Consideration to be paid the holder of
the Units or GP Units which had been represented by the Certificate.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;At any time which is more than six months after the Effective Time,
Lima or Parent may require the Distributing Agent to deliver to it any funds
which had been made available to the Distributing Agent and have not been
disbursed to former holders of Units or GP Units (including, without
limitation, interest and other income received by the Distributing Agent in
respect of the funds made available to it), and after the funds have been
delivered to Lima or Parent, former holders of Units or GP Units must look to
Lima or Parent for payment of the Merger Consideration upon surrender of the
Certificates held by them. None of Lima, Parent, the Surviving Partnership or
the Distributing Agent will be liable to any former holders of Units or GP
Units for any Merger Consideration which is delivered to a public official
pursuant to any abandoned property, escheat or similar law.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;At the close of business on the day during which the Effective Time
occurs, the Company will not record any transfers of Units or GP Units on the
books of the Company, and the depositary of the Company will be closed. If,
after the Effective Time, Certificates are presented for transfer (together
with a properly completed letter of transmittal as contemplated by Section
1.11(c)), they will be canceled and treated as having been surrendered for the
Merger Consideration described in Section&nbsp;1.7(a).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.12 Determinations Regarding Documents. The Surviving Partnership will
have the discretion, which it may delegate in whole or in part, to determine
whether letters of transmittal accompanying Certificates have been properly and
timely completed, signed and submitted and
</FONT>
<P align="center"><FONT size="2">- 5 -</FONT>
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<P align="left"><FONT size="2">to determine whether or not to disregard immaterial defects in particular
letters of transmittal. The decision of the Surviving Partnership with regard
to those matters will be conclusive and binding. None of Lima, Parent, the
Company, the Surviving Partnership or the Distributing Agent will have any
obligation to notify any person of any defect in a letter of transmittal
submitted to the Surviving Partnership or the Distributing Agent, as
applicable.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.13 Equity Awards. Immediately prior to the Effective Time, each option,
appreciation right, restricted Unit or Unit right issued by the Company which
is outstanding at the Effective Time (collectively, the &#147;Awards&#148;) and not then
otherwise fully vested will be deemed fully vested pursuant to the terms of the
applicable plan or instrument for the total number of Units purchasable or
issuable thereunder. All vested Awards will be cancelled in connection with
the Merger. As of the Effective Time, each cancelled Award will represent the
right to receive an amount of cash equal to the product of (x)&nbsp;the number of
Units subject to the Award multiplied by (y)&nbsp;the Merger Consideration, reduced
by the aggregate unpaid exercise or purchase price or other consideration
payable for the Units issued under such Award. To receive the amount to which
a holder of an Award is entitled under this Section&nbsp;1.13, the holder must
deliver to the Surviving Partnership (a)&nbsp;any certificate or agreement relating
to the Award and (b)&nbsp;a document in form reasonably satisfactory to Parent in
which the holder acknowledges that the payment the holder is receiving is in
full satisfaction of any rights the holder may have under or with regard to the
Award. Lima will (or will cause Parent or the Surviving Partnership to) pay
the amount due (less the applicable exercise price of such Award) under this
Section&nbsp;1.13 to a holder of an Award promptly after the Surviving Partnership
receives from the holder the items described in clauses (a)&nbsp;and (b)&nbsp;of the
preceding sentence.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.14 Withholding. Parent may withhold from the Merger Consideration
payable to any Unitholder or GP Holder or consideration payable to any holder
of an Award pursuant to Section&nbsp;1.13 and pay to the appropriate taxing
authorities, any amounts which Parent may be required (or may reasonably
believe it is required) to withhold under the Internal Revenue Code of 1986
(the &#147;Code&#148;), or any provision of state, local or foreign tax law. Any portion
of the Merger Consideration or consideration payable pursuant to Section&nbsp;1.13
which is withheld as permitted by this Section&nbsp;1.14 will be deemed to have been
paid to the Unitholder, GP Holder, or holder of an Award with respect to whom
it is withheld. Parent acknowledges that because the Units represent interests
in a publicly traded partnership that are regularly traded on an established
securities market, no withholding will be required or undertaken by Parent
under Section&nbsp;1445(a) of the Code.
</FONT>
<P align="center"><FONT size="2"><B>ARTICLE 2<BR>
EFFECTIVE TIME OF MERGER</B>
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 Date of the Merger. Unless this Agreement is terminated prior to the
Effective Time in accordance with Article&nbsp;7, the day on which the Merger is to
take place (the &#147;Merger Date&#148;) shall be within seven business days after the
day on which all the conditions set forth in Article&nbsp;6 (other than conditions
which are contemplated to be satisfied on or after the Merger Date) have been
satisfied or waived. The Merger Date may be changed with the consent of the
Company and Parent.
</FONT>
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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 Execution of Certificate of Merger. On or prior to the Merger Date,
Acquisition and the Company will each execute a certificate of merger (the
&#147;Certificate of Merger&#148;) along with appropriate officers&#146; certificates as
required by applicable law, each of which will be in proper form for filing
under the RLPA, and deliver it to Paul, Hastings, Janofsky &#038; Walker LLP for
filing with the Secretary of State of California after all of the conditions in
Article&nbsp;6 have been satisfied or waived. When all the conditions in Article&nbsp;6
have been satisfied or waived, Parent and the Company will (a)&nbsp;cause the
Certificate of Merger to be filed with the Secretary of State of the State of
California on the Merger Date and (b)&nbsp;cause all other documents which must be
recorded or filed as a result of the Merger to be recorded or filed.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 Effective Time of the Merger. The Merger will become effective at the
date and time that the Certificate of Merger is filed with the Secretary of
State of the State of California, or at such other time and date as are agreed
upon by Parent and the Company and specified in the Certificate of Merger (that
being the &#147;Effective Time&#148;).
</FONT>
<P align="center"><FONT size="2"><B>ARTICLE 3<BR>
REPRESENTATIONS AND WARRANTIES OF THE COMPANY</B>
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except as set forth in a disclosure letter, dated as of the date of this
Agreement (the &#147;Company Disclosure Letter&#148;), delivered to Parent as provided in
Section&nbsp;5.9 hereof, the Company represents and warrants to Parent and
Acquisition as follows:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 Organization and Authorization, Validity of Agreement, Company Action.
The Company is a limited partnership duly formed, validly existing and in good
standing under the laws of the State of California. The Company has all
partnership power and authority necessary to enable it to enter into this
Agreement and carry out the transactions contemplated by this Agreement. All
limited partnership actions necessary to authorize the Company to enter into
this Agreement and carry out the transactions contemplated by it, other than
approval of the principal terms of the Merger by a majority of the Unitholders
entitled to vote on the matter, have been taken. This Agreement has been duly
executed by the Company and, assuming the due authorization, execution and
delivery of this Agreement by each of Acquisition, Parent and Lima, is a valid
and binding agreement of the Company, enforceable against the Company in
accordance with its terms. Each of Newhall Management Limited Partnership, a
California limited partnership, which is the Company&#146;s managing general partner
(the &#147;Managing General Partner&#148;), Newhall General Partnership, a California
general partnership, which is the Company&#146;s only other general partner
(together with the Managing General Partner, the &#147;General Partners&#148;) and
Newhall Management Corporation, a California corporation, which is the managing
general partner of the Managing General Partner, and its board of directors,
have, in accordance with their respective organizational and constituent
documents, approved the Merger and this Agreement and have voted to recommend
to the Unitholders that they approve the principal terms of the Merger.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 No Conflicts. Neither the execution and delivery of this Agreement or
of any document to be delivered in accordance with this Agreement nor the
consummation of the transactions contemplated by this Agreement or by any
document to be delivered in accordance with this Agreement will (a)&nbsp;violate,
result in a breach of, or constitute a default (or an event which, with notice
or lapse of time or both, would constitute a default) under, the certificate of
</FONT>
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<P align="left"><FONT size="2">limited partnership or the limited partnership agreement of the Company
(the &#147;Governing Documents&#148;) or any of the constituent documents of either of
the General Partners or (b)&nbsp;contravene, conflict with, or result in a violation
or breach (with or without the passage of time or the giving of any notice) in
any material respect of any provision of, or give any person the right to
declare a default or exercise any remedy or right of termination under, or to
accelerate the maturity or performance of, or to cancel, terminate, or modify,
any loan or other evidence of indebtedness or mortgage or any other material
contract or document to which the Company is a party or any of its assets or
property is bound or subject, except as provided in Section&nbsp;1.13 hereof and
except as shown in Section&nbsp;3.2 of the Company Disclosure Letter.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3 No Violations. Except as shown in Section&nbsp;3.3 of the Company
Disclosure Letter, no governmental filings, authorizations, approvals, or
consents, or other governmental action, other than the expiration or
termination of waiting periods under the Hart-Scott Rodino Antitrust
Improvements Act of 1976 (the &#147;HSR Act&#148;), clearance by the SEC of the Proxy
Statement for mailing, and the approval of the California Public Utilities
Commission (&#147;Utilities Commission&#148;) under the California Public Utilities Act
(the &#147;PUA&#148;), are required to permit the Company to fulfill all its obligations
under this Agreement and consummate the Merger, other than governmental
filings, authorizations, approvals, consents or other governmental actions the
absence of which would not have a Material Adverse Effect on the Company. As
used in this Agreement, the term &#147;Material Adverse Effect on the Company&#148; means
(i)&nbsp;aggregate losses, liabilities and/or expenses to the Company and its
subsidiaries that exceed, or would reasonably be expected to exceed, $50.0
million or (ii)&nbsp;events, facts, circumstances and/or conditions that would
reasonably be expected to prevent the Company from consummating the Merger, but
(a)&nbsp;no individual loss, liability or expense of $1.0&nbsp;million or less will be
counted in determining losses, liabilities or expenses which are aggregated
towards such $50.0&nbsp;million threshold, although a series of directly related
losses, liabilities or expenses will be aggregated together to determine
whether the $1.0&nbsp;million threshold has been met; (b)&nbsp;no losses, liabilities or
expenses related to, arising out of or otherwise by virtue of the Newhall Ranch
Entitlement (as defined in Section&nbsp;5.2(b)) will be aggregated toward such $50.0
million threshold; (c)&nbsp;no losses, liabilities or expenses related to, arising
out of or otherwise by virtue of (i)&nbsp;changes in general economic conditions
(including, without limitation, changes in interest rates), (ii)&nbsp;changes or
occurrences affecting the homebuilding industry generally or (iii)&nbsp;changes in
laws, rules, orders or regulations of governmental entities, will be aggregated
toward such $50.0&nbsp;million threshold; (d)&nbsp;no losses, liabilities or expenses
required by a change in generally accepted accounting principles (&#147;GAAP&#148;) will
be aggregated toward such $50.0&nbsp;million threshold; and (e)&nbsp;no losses,
liabilities or expenses arising out of, related to, or otherwise by virtue of
facts, circumstances or conditions that existed on or before September&nbsp;4, 2003
(the &#147;Due Diligence Termination Date&#148;) and which either (i)&nbsp;the Company
disclosed in writing to Parent and/or Lima at least three (3)&nbsp;business days
prior to the Due Diligence Termination Date or (ii)&nbsp;Parent or Lima has
independently obtained actual and current knowledge as of the Due Diligence
Termination Date will be aggregated toward such $50.0&nbsp;million threshold.
Except as shown in Section&nbsp;3.3 of the Company Disclosure Letter, neither the
Company nor any other person is or will be required to give any notice to or
obtain any consent or approval from any person in connection with the execution
and delivery of this Agreement or the consummation or performance of the
transaction contemplated hereby or any change in control of the Company. In
that regard, except as specifically shown in Section&nbsp;3.3 of the Company
Disclosure Letter, as a result of the change in control of the Company, no
</FONT>
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<P align="left"><FONT size="2">indebtedness or other material obligations or material contracts of the
Company or any of its subsidiaries or affiliates will be accelerated, become
due or terminate.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4 Qualification. Section&nbsp;3.4 of the Company Disclosure Letter contains
a true and complete list of all of the Company&#146;s subsidiaries, the states of
organization or formation and the percentage ownership by the Company of such
subsidiaries and a true and complete list of all other equity interests,
options, warrants or other rights exercisable into or debt or equity
convertible or exchangeable into equity interests of any other person or entity
owned directly or indirectly by the Company or any of its subsidiaries. The
Company and each of its subsidiaries is qualified to do business as a foreign
partnership or other business entity in each state in which it is required to
be qualified, except states in which the failure to qualify, in the aggregate,
would not have a Material Adverse Effect on the Company.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5 Capitalization. On July&nbsp;18, 2003, there were 36,483,333 Units
outstanding (including 187,000 outstanding restricted Units shown in Section
3.5 of the Company Disclosure Letter and 13,252,347 Units held in treasury) and
288,810 GP Units outstanding. All the outstanding Units and GP Units have been
duly authorized and issued and are fully paid and issued in accordance with the
Company&#146;s limited partnership agreement. Except as shown in Section&nbsp;3.5 of the
Company Disclosure Letter, the Company has not issued any options, warrants or
convertible or exchangeable securities or other rights to acquire Units or GP
Units or any other equity securities or any appreciation rights, and is not a
party to any other agreements, which require, or upon the passage of time, the
payment of money or the occurrence of any other event may require, the Company
to issue or sell any Units or GP Units or any other equity securities. Except
as set forth in Section&nbsp;3.5 of the Company Disclosure Letter, there are no
restricted Units outstanding. The number of Units which the Company
repurchased between January&nbsp;1, 2003 and the date of this Agreement did not
exceed 1,289,265 Units and the total amount the Company paid for those Units
did not exceed $37,779,695.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.6 Subsidiaries. Except as shown in Section&nbsp;3.6 of the Company
Disclosure Letter, (a)&nbsp;each of the corporations and other entities of which the
Company owns directly or indirectly 51% or more of the equity (each corporation
or other entity of which a company owns directly or indirectly 51% or more of
the equity being a &#147;subsidiary&#148; of that company) has been duly organized, and
is validly existing and in good standing under the laws of its state of
incorporation or organization, (b)&nbsp;all the shares of stock or interests owned
by the Company or any subsidiary of the Company are duly authorized, validly
issued, fully paid and, in the case of stock, non-assessable and are not
subject to any preemptive rights, and (c)&nbsp;neither the Company nor any of its
subsidiaries has issued any options, warrants or convertible or exchangeable
securities or any other rights to acquire any equity securities or any
appreciation rights, or is a party to any other agreements, which require, or
upon the passage of time, the payment of money or the occurrence of any other
event may require, the Company or any subsidiary to issue or sell any stock or
other equity interests in any of the Company&#146;s subsidiaries and, there are no
registration covenants or transfer or voting restrictions or other shareholder
agreements or arrangements with respect to outstanding securities of any of the
Company&#146;s subsidiaries.
</FONT>
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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.7 Reports and Financial Statements.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Since January&nbsp;1, 2002, the Company has filed with the SEC all forms,
statements, reports and documents it has been required to file under the
Securities Act of 1933, as amended (the &#147;Securities Act&#148;), the Securities
Exchange Act of 1934, as amended (the &#147;Exchange Act&#148;), or the rules promulgated
under them.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;The Company&#146;s Annual Report on Form&nbsp;10-K for the year ended December
31, 2002 (the &#147;2002 10-K&#148;) and its Quarterly Report on Form&nbsp;10-Q for the period
ended March&nbsp;31, 2003 (the &#147;March&nbsp;10-Q&#148;) which the Company filed with the SEC,
including the documents incorporated by reference therein, each contained, all
the information required to be included in it and, when it was filed, did not
contain an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements made in it, in light of the
circumstances under which they were made, not misleading. Without limiting
what is said in the preceding sentence, the financial statements included in
the 2002 10-K all were prepared, and the financial information included in the
March&nbsp;10-Q was derived from financial statements which were prepared, in
accordance with GAAP applied on a consistent basis (except that financial
information included in the March&nbsp;10-Q does not contain notes and is subject to
normal year-end adjustments) and present fairly the consolidated financial
condition and the consolidated results of operations of the Company and its
subsidiaries at the dates, and for the periods, to which they relate.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.8 Assets. The assets of the Company and its subsidiaries constitute, in
the aggregate, all the assets (including, but not limited to, intellectual
property rights) used in or necessary to the conduct of their businesses as
they currently are being conducted.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.9 Compliance with Law; Permits.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;The Company and its subsidiaries have at all times complied, and
currently are complying, with all applicable Federal, state, local and foreign
laws and regulations, except failures to comply which would not reasonably be
expected, in the aggregate, to have a Material Adverse Effect on the Company.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;Except as shown in Section&nbsp;3.9(b) of the Company Disclosure Letter,
the Company and its subsidiaries have all licenses and permits which are
required at the date of this Agreement to enable them to conduct their
businesses as they currently are being conducted, except licenses or permits
the lack of which would not reasonably be expected, in the aggregate, to have a
Material Adverse Effect on the Company.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.10 Tax Matters. The Company and each of its subsidiaries has filed when
due (taking account of extensions) all Tax Returns (as defined below) relating
to Federal income taxes, and all other material Tax Returns, which it has been
required to file and has paid all Taxes shown on those returns to be due.
Those Tax Returns are true, correct and complete in all material respects and
accurately reflect the income, gains, losses, deductions, credits and Taxes
required to have been reported or paid, except to the extent of items which may
be disputed by applicable taxing authorities but for which there is substantial
authority to support the position taken by the Company or the subsidiary and
which have been adequately reserved against in
</FONT>
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<P align="left"><FONT size="2">accordance with GAAP on the balance sheet at March&nbsp;31, 2003 included in
the March&nbsp;10-Q. The Company has maintained all documents, books and records as
are required to be maintained by it and its subsidiaries under applicable Tax
laws. Except as shown in Section&nbsp;3.10 of the Company Disclosure Letter, (a)&nbsp;no
waiver or consent regarding the application of the statute of limitations or
extension of time given by the Company or any of its subsidiaries for
completion of the audit of any of its Federal income Tax Returns or other
material Tax Returns is in effect, (b)&nbsp;no tax lien has been filed by any taxing
authority against the Company or any of its subsidiaries or any of their assets
relating to Taxes, penalties and interest in excess of $100,000 in any
instance, or $1,000,000 in aggregate, (c)&nbsp;no Federal income Tax Return, or
material state, local or foreign Tax Return, of the Company or any subsidiary,
is the subject of a pending audit or other administrative proceeding or court
proceeding, (d)&nbsp;except as shown in Section&nbsp;3.10 of the Company Disclosure
Letter, neither the Company nor any subsidiary is a party to any agreement
providing for the allocation or sharing of Taxes (other than agreements solely
between the Company and its direct or indirect wholly owned subsidiaries or
among direct or indirect wholly owned subsidiaries of the Company), (e)&nbsp;neither
the Company nor any subsidiary has participated in or cooperated with an
international boycott as that term is used in Section&nbsp;999 of the Code, (f)&nbsp;the
liabilities and reserves for Taxes reflected in the consolidated balance sheet
at March&nbsp;31, 2003 included in the March&nbsp;10-Q cover all Taxes for all periods
ended at or prior to the date of such balance sheet and have been determined in
accordance with GAAP and there is no material liability for Taxes for any
period beginning after the date of such balance sheet other than Taxes arising
in the ordinary course of business, including Tax liabilities assumed or
incurred in the purchase of real estate in the ordinary course of business
which are not material in the aggregate, (g)&nbsp;no event, transaction, act or
omission has occurred which could result in the Company&#146;s becoming liable to
pay or to bear any Tax as a transferee, successor or otherwise which is
primarily or directly chargeable or attributable to any other person, firm or
company, and the Company has no actual or contingent liability (whether by
reason of any indemnity, warranty or otherwise) to any other person in respect
of any actual, contingent or deferred liability of such person for Taxes, (h)
the Company is not required to include in income any adjustment pursuant to
Section&nbsp;481(a) of the Code by reason of a voluntary change in accounting method
initiated by the Company, and the Internal Revenue Service (the &#147;IRS&#148;) has not
proposed any such adjustment or change in accounting method, (i)&nbsp;the Company
and each of its subsidiaries which have been treated as partnerships or
disregarded entities for federal or state Tax purposes have been properly so
classified for each taxable year beginning in or after 1985, (j)&nbsp;the Company
has satisfied the requirements of Section&nbsp;7704(c) of the Code for each year
beginning after December&nbsp;31, 1987, and (k)&nbsp;the Company has not made an election
under Section&nbsp;7704(g)(2) of the Code. For the purposes of this Agreement, the
term &#147;Taxes&#148; means all taxes (including, but not limited to, withholding
taxes), assessments, fees, levies and other governmental charges, and any
related interest or penalties. For the purposes of this Agreement, the term
&#147;Tax Return&#148; means any report, return or other tax-related information required
to be supplied to a taxing authority or to Unitholders or their assignees in
connection with Taxes.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.11 Environmental Matters. The Company and its subsidiaries have all
material environmental permits which are necessary to enable them to conduct
their businesses as they currently are being conducted without violating any
Environmental Laws, except as shown in Section&nbsp;3.11 of the Company Disclosure
Letter. Except as shown in Section&nbsp;3.11 of the Company Disclosure Letter,
neither the Company nor any subsidiary has received any written notice of, and,
to the Knowledge of the Officers (as defined below), the Company is not aware
</FONT>
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<P align="left"><FONT size="2">of, noncompliance or liability under any Environmental Law which is now
pending. Except as shown in Section&nbsp;3.11 of the Company Disclosure Letter,
neither the Company nor any subsidiary has performed any acts, including, but
not limited to, releasing, storing or disposing of hazardous materials, there
is no condition on any property owned or leased by the Company or a subsidiary,
and there was no condition on any property formerly owned or leased by the
Company or a subsidiary while the Company or a subsidiary owned or leased that
property, that would be a basis for liability of the Company or a subsidiary
under any Environmental Law, except as shown in Section&nbsp;3.11 of the Company
Disclosure Letter. Except as shown in Section&nbsp;3.11 of the Company Disclosure
Letter, neither the Company nor any subsidiary is subject to any order of any
court or governmental agency requiring the Company or any subsidiary to take,
or refrain from taking, any actions in order to comply with any Environmental
Law and no action or proceeding seeking such an order is pending or, to the
Knowledge of the Officers, threatened against the Company. For purposes of
this Agreement the term &#147;Knowledge of the Officers&#148; means the current actual
knowledge of Gary M. Cusumano, Donald L. Kimball, Ross J. Pistone, Thomas E.
Dierckman, Steven D. Zimmer and Eric Higgins. As used in this Agreement, the
term &#147;Environmental Law&#148; means any Federal, state or local law, rule,
regulation, guideline or other legally enforceable requirement of a
governmental authority relating to protection of the environment (including,
without limitation, endangered or threatened species) or to environmental
conditions which affect human health or safety.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.12 Opinion of Financial Advisor. The General Partners have received the
opinion of Morgan Stanley &#038; Co. Incorporated (the &#147;Financial Advisor&#148;), the
Company&#146;s financial advisor, dated not earlier than the day before the date of
this Agreement, in form satisfactory to the General Partners, to the effect
that, as of the date of such opinion, the Merger Consideration was fair, from a
financial point of view, to the Unitholders.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.13 Litigation. Except as is described in the 2002 10-K or a subsequent
report filed with the SEC prior to the date hereof or in Section&nbsp;3.13 of the
Company Disclosure Letter, neither the Company nor any subsidiary is a party to
(i)&nbsp;any condemnation proceedings (pending or, to the Knowledge of the Officers,
threatened), (ii)&nbsp;any proceedings (pending, or to the Knowledge of the
Officers, threatened) relating to employment or employee related matters or
(iii)&nbsp;any litigation, proceeding or investigation (pending or, to Knowledge of
the Officers, threatened) which is required to be disclosed in an Annual Report
on Form&nbsp;10-K of the Company or would reasonably be expected to result in the
Company incurring any loss, liability or expense in excess of $1&nbsp;million.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.14 Section&nbsp;280G. Except as shown in Section&nbsp;3.14 of the Company
Disclosure Letter, there are no contracts, agreements or other arrangements
which could result, as a result of the Merger or this Agreement, in the payment
by the Company or by any of its subsidiaries or the Surviving Partnership,
Parent or Lima of an &#147;Excess Parachute Payment&#148; as that term is used in Section
280G of the Code or the payment by the Company or any of its subsidiaries or
the Surviving Partnership, Parent or Lima of compensation which will not be
deductible because of Section&nbsp;162(m) of the Code.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.15 Affiliate Transactions. Except as shown in Section&nbsp;3.15 of the
Company Disclosure Letter, no Unitholder (to the extent of the Knowledge of any
Officer), officer, director or general partner of the Company, affiliate of the
Company or a general partner, officer, director
</FONT>
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<P align="left"><FONT size="2">or general partner of an affiliate of the Company or member of the
immediate family of any of the foregoing (to the extent of the Knowledge of the
Officers) has within the preceding 18&nbsp;months: (a)&nbsp;borrowed from or loaned money
or other property to the Company or an affiliate of the Company which has not
been repaid or returned; or (b)&nbsp;except as described in the 2002 10-K (i)&nbsp;had
any direct or indirect material interest in any person which is a customer or
supplier of the Company or an affiliate of the Company or (ii)&nbsp;has any other
material contract, agreement or arrangement (oral or written) with the Company.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.16 ERISA Matters. Section&nbsp;3.16 of the Company Disclosure Letter
contains a complete and accurate list of each pension, retirement, profit
sharing, savings, stock option, restricted stock, severance, termination,
bonus, fringe benefit, insurance, supplemental benefit, medical, or education
reimbursement, including each material &#147;employee benefit plan&#148; as defined in
Section&nbsp;3(3) of ERISA, sponsored, maintained or contributed to or required to
be contributed to by the Company for the benefit of current or former employees
and/or officers of the Company or any subsidiary (each a &#147;Plan&#148;). Company is
in compliance in all material respects with and not in material violation of
any and all material obligations and agreements of the Company under each Plan
and is not in material violation of any law, regulation, rule or other
requirement of any governmental authority with respect to any Plan and no
&#147;reportable event&#148; within the meaning of Section&nbsp;4043 of ERISA (excluding any
such event for which the thirty-day notice requirement has been waived under
the regulations to Section&nbsp;4043 of ERISA) nor any event described in Section
4062 or 4063 of ERISA has occurred. Complete and accurate copies of the
following items relating to each Plan, where applicable, have been delivered to
Parent or its representatives: (a)&nbsp;all material Plan documents and related
trust agreements, including amendments thereto; (b)&nbsp;the most recent
determination letter received from the IRS with respect to each such Plan that
is intended to be qualified under the Code; (c)&nbsp;the most recent summary plan
description, summary of material modifications and all material communications
to participants, other than individualized participant communications such as
benefit statements, projections, and the like; and (d)&nbsp;the most recent Annual
Report (5500 Series) and accompanying schedules for each Plan as filed with the
IRS. Each of the Plans that is intended to be &#147;qualified&#148; within the meaning
of Section&nbsp;401(a) of the Code has either been determined to be so qualified by
the IRS, still has a remaining period of time under applicable Treasury
Regulations or IRS pronouncements in which to apply for such determination
letter and to make any amendments necessary to obtain a favorable determination
(and Section&nbsp;3.16 of the Company Disclosure Letter indicates which are in the
foregoing category) or has been established under a standardized prototype plan
for which an IRS opinion letter has been obtained by the plan sponsor and is
valid as to the Plan. The Company has incurred no liability with respect to a
Plan termination under Title IV of ERISA, a funding deficiency under Section
412 of the Code or Section&nbsp;302 of ERISA or a withdrawal from a &#147;multiemployer
plan&#148; or under Section&nbsp;4063 of ERISA. The consummation of the transactions
contemplated under this Agreement will not change, create or accelerate any
obligation or liability of the Company under any Plan or terminate or require
any material modification or change to any Plan except as provided in Section
1.13 hereof and as set forth in Section&nbsp;3.16 of the Company Disclosure Letter.
Each Plan can be amended, terminated or otherwise discontinued after the Merger
Date in accordance with its terms, without liability to Acquisition (other than
ordinary administrative expenses typically incurred in a termination event).
With respect to each Plan, the Company and its affiliates have complied in all
material respects with (x)&nbsp;the applicable health care continuation and notice
provisions of COBRA and the regulations thereunder, (y)&nbsp;the applicable
requirements
</FONT>
<P align="center"><FONT size="2">- 13 -</FONT>
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<P align="left"><FONT size="2">of the Family Medical and Leave Act of 1993 and the regulations
thereunder, and (z)&nbsp;the applicable requirements of the Health Insurance
Portability and Accountability Act of 1996 and the regulations thereunder. Set
forth in Section&nbsp;3.16 of the Company Disclosure Letter is a list of all
employment and consulting agreements or similar type agreements of the Company
and its subsidiaries.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.17 Brokers or Finders. Except for the Financial Advisor (whose fees
will be paid by the Company), neither the Company nor any Company subsidiary or
their respective affiliates has an obligation to pay any agent, broker,
investment banker, financial advisor or other firm or Person any brokers&#146; or
finder&#146;s fee or any other commission or similar fee in connection with any of
the transactions contemplated by this Agreement. For purposes of this agreement
the term &#147;Person&#148; will mean a natural person, partnership (general or limited),
corporation limited liability company, business trust, joint stock company,
trust, unincorporated association, joint venture, governmental entity or other
entity or organization.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.18 Material Contracts. Section&nbsp;3.18 of the Company Disclosure Letter
contains a true and complete list of the Material Contracts (as hereinafter
defined) to which the Company or any of its subsidiaries is a party as of the
date hereof which relates directly or indirectly to the Company or the assets
owned or used by the Company or the Company&#146;s or any of its subsidiaries&#146;
business or operations, including, without limitation, loans, guarantees or
other evidence of indebtedness; mortgages or security agreements; warranties;
contracts relating to employment and services of independent contractors, the
purchase of raw materials and supplies or other products or service contracts;
contracts relating to the purchase or sale of real estate; development or
construction contracts; the Plans; contracts with any government authority or
other third parties relating to the sharing of costs of the construction,
installation and maintenance of streets, utility lines or other on or off-site
improvements; contracts relating to the reproration of real estate taxes and
assessments following the Company&#146;s acquisition of any real estate (excluding
all contracts for the sale of homes entered into with a home buyer or for the
purchase or sale of land entered into in either case in the ordinary course of
business consistent with past custom and practice); and any contract or
agreement relating to the Units or a change in control of the Company. For
purposes of this Section&nbsp;3.18, a contract is deemed material (the &#147;Material
Contracts&#148;) if it is: (i)&nbsp;a contract for the sale of real estate or the
purchase of real estate (under which legal title to such real estate has not
yet been fully conveyed to the Company or any of its subsidiaries or the
Company or any of its subsidiaries has any outstanding liability or obligation)
or the leasing of real estate (other than commercial tenant leases) or an
option or other right to purchase or sell or lease (other than commercial
tenant leases) real estate; (ii)&nbsp;a contract or agreement (including any
commercial tenant leases) that gives rise to rights, liabilities, expenses or
obligations on the part of either the Company or another party exceeding $1.0
million in the aggregate throughout the term of the contract or agreement;
provided, however, that any such contract or agreement shall not be deemed
material for purposes of this Section&nbsp;3.18 if such contract or agreement is
terminable or cancelable at will by the Company without any penalty, charge,
fee or further obligation or liability of the Company or any of its
subsidiaries thereunder; (iii)&nbsp;each joint venture, partnership, limited
liability company and other contract involving a sharing of profits, losses,
costs, or liabilities by the Company with any other person or relating to any
ownership or equity interest of the Company in any person; (iv)&nbsp;a contract
containing covenants that in any way purport to restrict the business activity
of the Company or any of its subsidiaries or limit the freedom of the Company
or any of its subsidiaries
</FONT>
<P align="center"><FONT size="2">- 14 -</FONT>
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<P align="left"><FONT size="2">to engage in any line of business or to compete with any person; or (v)
union contracts or collective bargaining agreements. The Company has
performed, in all material respects, its obligations under each Material
Contract to the extent that such obligations to perform have accrued. Except
as set forth in Section&nbsp;3.18 of the Company Disclosure Letter, no breach or
default, alleged breach or default, or event which would constitute a breach or
default (by either Company or any party thereto, but as to any other party only
to the Knowledge of the Officers) has occurred under any Material Contract or
will occur as a result of this Agreement or the consummation of the
transactions contemplated hereunder, except to the extent that such breach or
default would not reasonably be expected to have a Material Adverse Effect.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.19 Conduct of Business. Since January&nbsp;1, 2003 to the date of this
Agreement, (i)&nbsp;the Company and its subsidiaries have conducted their respective
businesses in the ordinary course and in the same manner in which they were
conducted prior to January&nbsp;1, 2003 and (ii)&nbsp;no events or circumstances have
occurred or material facts exist which, individually or in the aggregate, have
had a Material Adverse Effect on the Company which has not been disclosed in
Section&nbsp;3.19 of the Company Disclosure Letter.
</FONT>
<P align="center"><FONT size="2"><B>ARTICLE 4<BR>
REPRESENTATIONS AND WARRANTIES OF LIMA,<BR>
PARENT AND ACQUISITION</B>
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each of Lima, Parent and Acquisition represents and warrants to the
Company as follows:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1 Organization. Each of Lima is a Delaware corporation, validly
existing and in good standing under the laws of the State of Delaware. Parent
is a limited liability company duly formed, validly existing and in good
standing under the laws of the State of Delaware. Acquisition is a limited
partnership duly formed, validly existing and in good standing under the laws
of the State of California. Parent has only two members. Acquisition General
Partner is the sole general partner of Acquisition. Neither Parent nor
Acquisition has engaged in any business since the date of its organization
other than as contemplated hereby.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 Authorization. Each of Lima, Parent and Acquisition has the power and
authority necessary to enable it to enter into this Agreement and carry out the
transactions contemplated by this Agreement. All actions necessary to
authorize each of Lima, Parent and Acquisition to enter into this Agreement and
carry out the transactions contemplated by it, including obtaining the approval
of the board of directors of each Lima, partners of Acquisition and all of the
members of Parent, have been taken. This Agreement has been duly executed by
each of Lima, Parent and Acquisition and, assuming the due authorization,
execution and delivery of this Agreement by the Company, is a valid and binding
agreement of each of Lima, Parent and Acquisition, enforceable against each of
Lima, Parent and Acquisition in accordance with its terms.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 No Violations. Neither the execution and delivery of this Agreement
or of any document to be delivered in accordance with this Agreement nor the
consummation of the transactions contemplated by this Agreement or by any
document to be delivered in accordance with this Agreement will violate, result
in a breach of, or constitute a default (or an event which, with notice or
lapse of time or both, would constitute a default) under, (a)&nbsp;the certificate
of
</FONT>

<P align="center"><FONT size="2">- 15 -</FONT>



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<P align="left"><FONT size="2">incorporation or bylaws of each Lima, (b)&nbsp;the certificate of formation or
operating agreement of Parent or (c)&nbsp;the certificate of limited partnership or
limited partnership agreement of Acquisition, any agreement or instrument to
which either of Lima, Parent or Acquisition or by which any of them is bound,
any law, or any order, rule or regulation of any court or governmental agency
or other regulatory organization having jurisdiction over Lima, Parent and/or
Acquisition, except violations or breaches of, or defaults under, agreements or
instruments which would not have a material adverse effect on the ability of
Lima, Parent or Acquisition to timely consummate the transactions contemplated
by this Agreement.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4 Consents; Approval. No governmental filings, authorizations,
approvals, or consents, or other governmental action, other than (a)&nbsp;the
expiration or termination of waiting periods under the HSR Act, if any, (b)&nbsp;the
approval of the Utilities Commission under the PUA and the filing of the
Certificate of Merger as required by the RLPA, are required to permit each of
Lima, Parent and Acquisition to fulfill all its obligations under this
Agreement.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5 Brokers or Finders. Neither Lima, Parent or Acquisition, nor their
respective affiliates, has any obligation to pay any agent, broker, investment
banker, financial advisor or other firm or Person, any brokers&#146; or finders&#146; fee
or any other commission or similar fee in connection with any of the
transactions contemplated by this Agreement.
</FONT>
<P align="center"><FONT size="2"><B>ARTICLE 5<BR>
COVENANTS</B>
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1 Due Diligence Period.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Inspections. In addition to the rights of Parent under Section&nbsp;9.5,
Parent will have the right, at any time during the period commencing on the
date of this Agreement and ending at the termination of this Agreement (the
&#147;Termination Date&#148;) and at Parent&#146;s sole cost and expense except as otherwise
provided in Section&nbsp;7.1(i) and Section&nbsp;8.1, to investigate, review, inspect and
become familiar with all aspects of the land owned or leased, directly or
indirectly, by the Company or any of its subsidiaries, together with any
easements, access rights, air, water and riparian rights, development rights,
solar rights and all tenements, privileges and appurtenances thereto, including
all improvements to such land (the &#147;Real Property&#148;), and the Company&#146;s and its
subsidiaries&#146; operations and businesses. Parent will, at Parent&#146;s sole cost
and expense: (i)&nbsp;consult with such geotechnical engineers, contractors and
other professional consultants as deemed necessary by Parent, (ii)&nbsp;conduct a
physical inspection of the Real Property with such professional consultants as
Parent deems necessary; (iii)&nbsp;consult with employees of the Company; (iv)
contact and consult with governmental and regulatory agencies and authorities
and their representatives; and (v)&nbsp;make such other inquiries, evaluations,
appraisals, inspections and investigation as Parent deems necessary or
advisable; <I>provided</I>, <I>however</I>, that any entry onto the Real Property by Parent
or Parent&#146;s Representatives will be made in accordance with and subject to
Section&nbsp;5.1(b). Subject to Section&nbsp;7.1(i) and Section&nbsp;8.1, Parent will be
responsible for all costs and expenses incurred in connection with its
investigations relating to the Real Property. In no event will the Company be
liable for any amount or payments for any work done by or on behalf of Parent.
As used in this Agreement, the &#147;Parent&#146;s Representatives&#148; means engineers,
professional consultants, lenders, contractors, subcontractors, agents,
employees, licensees, invitees or representatives or any other parties
</FONT>

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<P align="left"><FONT size="2">directly or indirectly employed or contracted by Parent, Acquisition, any
of Parent&#146;s members or affiliates or reasonably under the control of any of the
foregoing or for whose acts any of the foregoing may be liable.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;License to Enter Real Property. The Company hereby grants to Parent a
nonexclusive license and permission to enter upon the Real Property for the
purpose of inspecting and investigating the Real Property and for no other
purpose and otherwise subject to Parent&#146;s strict compliance with the following
terms and conditions:
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;The permission granted by this Section&nbsp;5.1(b) is solely a license;
Parent has no rights as an owner, purchaser or tenant solely by virtue of this
Agreement or the right to enter the Real Property.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;The term of this license will commence as of the date of this
Agreement and will continue until the earlier of the Due Diligence Termination
Date or the termination of this Agreement. Upon the expiration or termination
of this license, Parent will vacate all portions of the Real Property and
remove any of Parent&#146;s property located thereon.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;Except for Parent&#146;s Representatives, Parent will not authorize any
other party or person to enter or use the Real Property during the term of this
license without the Company&#146;s prior written consent. Parent will be totally
responsible and liable for all acts and omissions of any of Parent&#146;s
Representatives to the same extent Parent is responsible and liable for the
acts and omissions of parties directly employed by Parent. In no event will
the Company be liable to Parent for any amount whatsoever for work done by
Parent or any of Parent&#146;s Representatives on or with respect to the Real
Property. Parent will be solely responsible for all payments due all Parent&#146;s
Representatives whether or not such persons or parties are entitled to assert
mechanics&#146; liens, stop notices, equitable liens or labor and material bond
rights against the Real Property.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;Lima or Parent and each of Lima&#146;s or Parent&#146;s Representatives, or
Lima or Parent on behalf of Lima or Parent&#146;s Representatives, will, at their
sole cost and expense, maintain in full force and effect with reputable
companies qualified to do business in California during any time when Parent
and/or any of Parent&#146;s Representatives enter upon the Real Property or are
otherwise taking any action with respect to the Real Property, the following
insurance:
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A)&nbsp;If such party or person has employees, such person or party will
maintain in force at all times prior to the Due Diligence Termination Date
workers&#146; compensation insurance, including employer&#146;s liability (at a minimum
limit of $1,000,000 each accident, $1,000,000 disease policy limit, $1,000,000
disease each employee) for all persons who will be carrying out any work on or
in connection with the Real Property. Such insurance will be in accordance
with the requirements of the most current and applicable workers&#146; compensation
insurance laws in effect from time to time.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B)&nbsp;Such person will maintain in force at all times prior to the Due
Diligence Termination Date comprehensive or commercial general liability
insurance on an
</FONT>


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<P align="left"><FONT size="2">&#147;occurrence&#148; basis with a combined single limit for death,
bodily injury and property damage of $5,000,000 per occurrence.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C)&nbsp;Such person will maintain in force at all times prior to the Due
Diligence Termination Date owned, hired and non-owned automobile liability
insurance covering all use of all automobiles, trucks and other motor vehicles
utilized by or on behalf of Parent or Parent&#146;s Representative in connection
with investigations of and access to/from the Real Property with a combined
single limit for bodily injury and property damage of $1,000,000 or in an
amount equal to the limit from time to time carried by Parent or Parent&#146;s
Representatives, if greater.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D)&nbsp;The limits of liability of the insurance coverage specified in this
Section&nbsp;5.1(b) may be provided by any combination of primary and excess
liability insurance policies. Parent hereby waives all rights against the
Company and its subsidiaries and affiliates (and each of their respective
employees, partners, managers, representatives, agents and officers) for
damages caused by fire and other perils and any other risk to the extent
covered by Parent&#146;s policies of insurance or required to be covered by Parent&#146;s
policies of insurance as set forth above. The Company will be included as an
additional insured in a form acceptable to the Company under the coverage
specified above (exclusive of worker&#146;s compensation), and Parent will deliver
certificates issued by Parent&#146;s insurance carriers acceptable to the Company
showing such policies in force for the specified period. Nothing contained in
these insurance requirements is to be construed as limiting the type, quality
or quantity of insurance Parent should maintain or the extent of Parent&#146;s
responsibility for payment of damages resulting from its operations.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;Compliance with Rules. Parent and Lima will comply with, and will
cause Parent&#146;s Representatives to comply with, all oral or written rules and
regulations established by the Company from time to time for access to and
entry on the Real Property, including, without limitation, the following:
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;The Company reserves the right to prohibit and restrict access at
certain times and from time to time without notice to Lima, Parent and Parent&#146;s
Representatives; provided, however, that such prohibitions and restrictions
shall not negatively impact Parent&#146;s or Parent&#146;s Representatives&#146; ability to
conduct their due diligence investigation. No access and/or use of the Real
Property will be permitted or otherwise undertaken except during reasonable
business hours and such other times as authorized by the Company.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;Lima and Parent (and their respective representatives) will be
subject to being stopped by the Company&#146;s security personnel and will cooperate
with such security personnel, including providing personal and company
identification.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;The Company may require that Lima and Parent (and their respective
representatives) be accompanied at any or all times when accessing the Real
Property or on the Real Property by the Company or its authorized
representatives so long as the foregoing does not negatively impact Parent&#146;s or
Parent&#146;s Representatives&#146; ability to conduct their due diligence investigation.
</FONT>


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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;None of the following will be permitted on the Real Property: drugs
or narcotics (except subject to a written medical prescription therefor and
which is evidenced thereon), alcohol, firearms or fires.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;The Company will have the right to participate in, and supervise, all
meetings between Parent or Parent&#146;s Representatives and the employees of the
Company or representatives of any governmental agency or entity.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;Compliance with Applicable Laws. Lima and Parent (and their
respective representatives) will comply with all applicable federal, state or
local laws, ordinances, rules, regulations (whether under common law, statute,
rule, regulation or otherwise), permits, orders and any other requirements of
governmental authorities and agencies having jurisdiction over the Real
Property (&#147;Applicable Laws&#148;). Parent will give the Company immediate written
notice of any known violation, potential violation or non-compliance by Lima or
Parent or their respective representatives with any Applicable Laws.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;Risk. All persons who enter upon the Real Property pursuant to the
license granted in Section&nbsp;5.1(b) do so at their sole and exclusive risk.
Parent acknowledges that neither the Real Property nor the access routes
thereto will be maintained to facilitate viewing or inspection of the Real
Property and that the same may contain hazardous conditions. The Company will
not: (i)&nbsp;have any duty or obligation to inspect the Real Property or the
access routes thereto, (ii)&nbsp;have any duty or obligation to warn any person of
any patent or latent defect, condition or risk that might be incurred by Parent
and Parent&#146;s Representatives at the Real Property or in transit thereto; or
(iii)&nbsp;be liable for any damage of any kind whatsoever to any property belonging
to or used by Parent or any of Parent&#146;s Representatives while accessing or on
the Real Property or otherwise in connection with the Real Property. Lima and
Parent hereby waive all claims and demands relating to the matters described in
the preceding sentence.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;No Interference. Parent acknowledges that the Company, utility
companies and governmental authorities may be in the process of grading,
constructing and installing infrastructure, landscaping and other improvements
for the Real Property. Neither Parent&#146;s access to nor use of the Real Property
under this license will interfere with the reasonable use and enjoyment thereof
by the Company or any persons claiming through or under the Company.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;No Improvements. Neither Parent nor any of Parent&#146;s Representatives
will grade the Real Property, construct or install any improvements or
structures of any kind on the Real Property or bring or permit any hazardous
materials to be located on the Real Property in violation of any law.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;Repair of Real Property; Mechanics&#146; Liens. Parent will, at its sole
cost and expense, repair any damage done to the Real Property during the term
of this license by Parent or any of Parent&#146;s Representatives. Upon the
termination or expiration of this license, Parent will repair and restore every
portion of the Real Property to at least as good condition as existed prior to
Parent&#146;s entry onto the Real Property and otherwise attributable to activities
of Parent and any Parent&#146;s Representatives. Parent will, at its sole cost and
expense, promptly cause the removal of all exceptions to title and otherwise
pay and discharge all mechanics&#146;,
</FONT>


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<P align="left"><FONT size="2">materialmen&#146;s, contractors&#146; or
subcontractors&#146; or other liens or claims, or possible liens or claims or
similar exceptions arising from Parent&#146;s inspections and investigations of and
on the Real Property. Any and all increased costs of any title policy arising
from or due to the removal of such exceptions will be borne by Parent.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2 Company&#146;s Activities Until Effective Time. From the date of this
Agreement to the Effective Time, or such earlier time as this Agreement is
terminated in accordance with Article&nbsp;7, the Company will, and will cause each
of its subsidiaries to, except with the written consent of Parent (which
consent will not be unreasonably withheld, conditioned or delayed):
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Operate its business in the ordinary course and in a manner consistent
with past practices.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;Use commercially reasonable efforts to obtain in the ordinary course,
and not request a continuance, without the approval of Parent (which approval
will not be unreasonably conditioned, withheld or delayed), the Newhall Ranch
Entitlement. &#147;Newhall Ranch Entitlement&#148; means obtaining all approvals,
permits, consents and other authorizations from government and quasi-government
agencies for the entitlement and development of the project known as Newhall
Ranch, including, defending litigation and other claims under California
Environmental Quality Act, the Subdivision Map Act, California Zoning and
Planning Law, Federal and state Endangered Species Acts, the Clean Water Act
and local ordinances (it being understood that the receipt of such approvals,
permits, consents and other authorizations shall not be a condition to
Parent&#146;s, Lima&#146;s and Acquisition&#146;s obligations hereunder).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;Use commercially reasonable efforts to maintain the goodwill and value
of its business and the continued employment of its executives and other key
employees and to maintain good relationships with the customers, vendors,
suppliers, contractors, lenders, governmental and regulatory agencies and
authorities and others with which it does business.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;At its expense, use commercially reasonable efforts to maintain all
its assets in good repair and condition, except to the extent of reasonable
wear and use and damage by fire or other casualty.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;Not make any borrowings, other than borrowings in the ordinary course
of business consistent with past practices under working capital lines which
are disclosed in the notes to the consolidated balance sheet included in the
2002 10-K.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;Not incur or enter into any contractual commitments involving capital
expenditures, loans or advances, and not voluntarily incur any contingent
liabilities, except, in each case, in the ordinary course of business
consistent with past practices.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;Not redeem or purchase any of the outstanding Units and not make or
declare any distributions of any kind or repayments of debt to its partners
(other than payments by subsidiaries of the Company to the Company or to other
wholly owned subsidiaries of the Company), except in a manner consistent with
past practice or in accordance with existing contractual obligations described
in Section&nbsp;5.2(g) of the Company Disclosure Letter; <I>provided</I>, <I>however</I>, that
redemptions or purchases of any outstanding Units will not be made at a
purchase price in excess of the Merger Consideration; provided, further,
however, that, notwithstanding
</FONT>


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<P align="left"><FONT size="2">the foregoing, the distributions made by the
Company in any fiscal quarter from the date of this Agreement through the
Merger Date with respect to outstanding Units may not exceed $0.10 per Unit in
each of the second, third and fourth fiscal quarters and in the first fiscal
quarter the greater of $0.10 per Unit or the amount by which federal income tax
(assuming the then highest marginal federal income tax rate) payable by a holder of a Unit as a
result of the taxable income allocated to such holder by the Company with
respect to the prior calendar year exceeds $0.30 per Unit.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;Not make any loans or advances (other than advances for travel and
other normal business expenses otherwise permitted by law) to Unitholders or
directors, officers or employees of the Company or its General Partners or any
affiliates thereof.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;Maintain its books of account and records in the usual manner, in
accordance with GAAP applied on a basis consistent with the basis on which they
were applied in prior years (except to the extent such bases of reporting are
required to be changed by changes in GAAP or applicable law), subject to normal
year-end adjustments and accruals.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)&nbsp;Comply in all material respects with all applicable laws and
regulations of governmental agencies.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k)&nbsp;Except as set forth in Section&nbsp;5.2(k) of the Company Disclosure
Letter, not purchase, sell or otherwise dispose of or encumber any property or
assets, except in each case in the ordinary course of business and not in
violation of this Agreement.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l)&nbsp;Not sell any real property or asset out of the ordinary course of
business or at a price that is inconsistent with the Company&#146;s past practices
except for the sales listed in Section&nbsp;5.2(l) of the Company Disclosure Letter.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m)&nbsp;Not enter into or amend any employment, severance, change in control
or similar agreements or arrangements, or increase the salaries of any
employees, other than through normal annual increases consistent with past
practices.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n)&nbsp;Not adopt or amend any employee compensation, employee benefit or
post-employment benefit plan or agreement including, the Plans, other than as
required by a change in law.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o)&nbsp;Not amend its Governing Documents.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p)&nbsp;Except as set forth in Section&nbsp;5.2(p) of the Company Disclosure
Letter, (i)&nbsp;not issue or sell any of its stock, membership units or partnership
units (except upon exercise of Awards which are outstanding on the date of this
Agreement) or issue or grant any Awards (except Awards having a purchase or
exercise price payable to the Company at least equal to the amount of the
Merger Consideration as of the date of the grant of any such Award) or any
other options, warrants or convertible or exchangeable securities or other
rights to acquire equity securities or appreciations rights, (ii)&nbsp;not split,
combine or reclassify its outstanding stock, membership units or partnership
interests, and (iii)&nbsp;represent and warrant that as of the date of this
Agreement none of the actions set forth in clauses (i)&nbsp;and (ii)&nbsp;above has
occurred since July&nbsp;18, 2003.
</FONT>


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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q)&nbsp;Except as set forth in Section&nbsp;5.2(q) of the Company Disclosure
Letter, not construct any commercial buildings.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r)&nbsp;Not materially reduce the amount or modify the type and scope of any
insurance coverage provided by existing insurance policies (including, without
limitation, not allowing any policy to expire);
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(s)&nbsp;Not make or change any material election in respect of Taxes, adopt or
change any accounting method in respect of Taxes, file any material Tax Return
or any amendment to a material Tax Return except in the ordinary course of
business consistent with past practices, enter into any closing agreement,
settle any claim or assessment in respect of Taxes, or consent to any extension
or waiver of the limitation period applicable to any claim or assessment in
respect of Taxes.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(t)&nbsp;Not authorize or enter into any agreement to take any of the actions
which constitute negative covenants referred to in, or otherwise are restricted
or prohibited by, Sections&nbsp;5.2(a) through 5.2(s).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3 Parent&#146;s, Acquisition&#146;s and Lima&#146;s Activities Until Effective Time.
From the date of this Agreement to the Effective Time, or such earlier time as
this Agreement is terminated in accordance with Article&nbsp;7, each of Lima, Parent
and Acquisition will, and will cause each of its subsidiaries to, except with
the written consent of the Company:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Not take action, or not fail to take any action, which could
reasonably be expected to prevent or delay the provision of funding by Lima or
Parent in order to pay the Merger Consideration.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;Provide the Company all information reasonably requested by the
Company and all documents regarding the provision of funding by Lima or Parent
in order to pay the Merger Consideration.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;Not purchase (i)&nbsp;any Units in excess of 10% of the Company&#146;s
outstanding Units prior to the Company Meeting, or (ii)&nbsp;any Units at any time
that any of Lima, Parent or Acquisition is in possession of any material,
non-public information, except by operation of the Merger.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;Not authorize or enter into any agreement to take any of the actions
referred to in Sections&nbsp;5.3(a) and 5.3(c).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4 Regulatory Filings; Securities Filings.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;The Company, Lima and Parent and its members will each make as
promptly as practicable the filing it is required to make under the HSR Act and
the PUA with regard to the transactions which are the subject of this Agreement
and each of them will take all reasonable steps within its control (including
providing information to the Federal Trade Commission and the Department of
Justice, or the Utilities Commission, as the case may be) to cause the waiting
periods required by the HSR Act to be terminated or to expire, and approval of
the Utilities Commission to be obtained, as promptly as practicable. The
Company, Lima and
</FONT>


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<P align="left"><FONT size="2">Parent will each provide information and cooperate in all
other respects to assist the other of them in making its filing under the HSR
Act and the PUA.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;Any report that the Company is required to file after the date of this
Agreement with the SEC will contain all of the information required to be
included in such report and, when such report is filed, it will not contain an
untrue statement of a material fact or omit to state a material fact necessary
to make the statements in such report, in light of the circumstances under
which they are made, not misleading.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5 Unitholders&#146; Action. Subject to the Company&#146;s right to terminate this
Agreement pursuant to Section&nbsp;7.1, the Company will take all action which is
necessary in accordance with applicable law and its Governing Documents to call
and convene a meeting of the Unitholders (a &#147;Company Meeting&#148;) to consider and
vote upon approval of the principal terms of the Merger, which meeting shall be
held regardless of whether the General Partners have withdrawn or modified
their recommendation to approve the Merger unless this Agreement is terminated
pursuant to Article&nbsp;VII. The proxy statement distributed by the Company with
respect to the Company Meeting (&#147;Proxy Statement&#148;) will include the
recommendation of the General Partners that the Unitholders vote to approve the
principal terms of the Merger, unless the General Partners determine in good
faith, after consultation with counsel about the nature of their fiduciary
duties, that the failure to amend, withdraw or modify their recommendation of
the Merger would reasonably be expected to constitute a breach of their
fiduciary duties to the Unitholders under applicable law; <I>provided </I>that for all
purposes of this Agreement, a reasonable delay (not in excess of 10&nbsp;days) in
the date of the Company Meeting to allow the General Partners to consider a
Third Party (as defined in Section&nbsp;5.7) proposal for an Acquisition Transaction
(as defined in Section&nbsp;5.7) will not constitute a withdrawal, change or
modification of the General Partners&#146; recommendation. Subject to the preceding
sentence, the Company will (a)&nbsp;use commercially reasonable efforts to solicit
from the Unitholders proxies or votes in favor of approval of the principal
terms of the Merger, (b)&nbsp;mail the Proxy Statement to Unitholders as soon as
practicable after the SEC has cleared the Proxy Statement for mailing but in no
event later than five business days thereafter, and (c)&nbsp;cause the Company
Meeting to be held as soon as practicable after mailing of the Proxy Statement
but in no event later than 45&nbsp;days after the date on which the Proxy Statement
is cleared for mailing.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.6 Proxy Statement.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;The Company will prepare and file with the SEC as soon as practicable
after the date of this Agreement a Proxy Statement. Parent, Lima and the
Company will (i)&nbsp;consult with each other&#146;s counsel, (ii)&nbsp;cooperate with each
other in good faith (including the Company providing Lima and Parent and their
respective counsel for comment drafts of the Proxy Statement (which drafts
shall be promptly reviewed by them) and including any additions or changes
reasonably requested by them), and (iii)&nbsp;provide all information about itself
and its affiliates which is required to be included in the Proxy Statement in a
timely manner so the Proxy Statement can be filed with the SEC as soon as
reasonably practicable. The Company will cause the Proxy Statement to comply
as to form in all material respects with the applicable provisions of the
Exchange Act and the rules under the Exchange Act. The Company will use
commercially reasonable efforts, and Parent and Lima will cooperate with the
Company, to cause the Proxy Statement to be cleared for mailing by the staff of
the SEC as promptly as
</FONT>


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<P align="left"><FONT size="2">practicable after it is filed (including, without
limitation, responding to any comments received from the SEC with respect to
the Proxy Statement) and to keep the Proxy Statement accurate as long as is
necessary to consummate the Merger. The Company will, as promptly as
practicable, provide to Parent copies of any written comments received from the SEC
with regard to the Proxy Statement and will advise Parent of any comments with
respect to the Proxy Statement which are received orally from the staff of the
SEC.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;Parent, Lima and Acquisition each represents and warrants to the
Company, and the Company represents and warrants to Parent, that none of the
information supplied by it for inclusion, or included in a document filed by it
which is incorporated by reference, in the Proxy Statement and any amendments
or supplements to it, will, at the time it is mailed to Unitholders and at the
time of the Company Meeting, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they
were made, not misleading. If at any time before the Company Meeting an event
occurs with respect to the Company or any of its subsidiaries, or with respect
to Parent or any of its members, as the case may be, which is required to be
described in the Proxy Statement, an amendment or supplement to the Proxy
Statement will be filed with the SEC as promptly as practicable and, to the
extent required by law, will be distributed to the Unitholders. The Company
will not make any amendment or supplement to the Proxy Statement without the
approval of Parent, which approval will not be unreasonably withheld (and will
under no circumstances be withheld to the extent the amendment or supplement is
required to cause the Proxy Statement to comply with applicable law or relates
to a withdrawal, modification or amendment to the General Partners&#146;
recommendation as contemplated by Section&nbsp;5.5). The Company will advise Parent
promptly after it receives notice that the Proxy Statement has been cleared for
mailing or that any supplement or amendment to it has been filed, that any
order suspending or preventing the use of the Proxy Statement has been issued,
of any request by the staff of the SEC for an amendment of the Proxy Statement,
or of the receipt of comments or requests for additional information from the
staff of the SEC or the response to any such comments or requests for
additional information.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.7 No Solicitation of Offers; Notice of Proposals from Others.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Neither the Company nor any of its subsidiaries will, and the Company
will use commercially reasonable efforts to cause its and its subsidiaries&#146;
respective directors, officers, employees, investment bankers, attorneys and
other agents and representatives not to, directly or indirectly (i)&nbsp;solicit,
initiate or knowingly facilitate or encourage (including by way of furnishing
or disclosing nonpublic information) any inquiry or the making of any offer or
proposal by any corporation, partnership, trust, person or other entity or
group (a &#147;Third Party&#148;) with respect to, or that could reasonably be expected
to lead to, any acquisition of Units representing 15% or more of the fully
diluted Units as of the date of determination, any merger, consolidation, asset
purchase, unit exchange, business combination, tender offer, exchange offer or
similar transaction involving the acquisition of all or a substantial amount of
the assets or real property of the Company and its subsidiaries, taken as a
whole, out of the ordinary course of the Company&#146;s business, or a 15% or
greater fully diluted equity interest in (including by way of tender offer), or
a recapitalization or restructuring of, the Company or any of its material
subsidiaries (any of those transactions being an &#147;Acquisition Transaction&#148;) or
(ii)&nbsp;negotiate, explore or otherwise communicate in any way with any Third
Party with respect to any possible
</FONT>


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<P align="left"><FONT size="2">Acquisition Transaction, or enter into,
approve or recommend any agreement, arrangement or understanding requiring it
to abandon, terminate or otherwise fail to consummate the Merger or any other
of the transactions contemplated by this Agreement; <I>provided</I>, <I>however</I>, that the
Company may, in response to a proposal which was not solicited after the
date of this Agreement furnish information to, and engage in discussions or
negotiations with, a Third Party, if, but only if, (A)&nbsp;the General Partners
determine in good faith, after consultation with a financial advisor of
nationally recognized reputation, that the Third Party is financially capable
of completing the transaction which is the subject of the proposal and that, if
completed, that transaction would, taking all relevant circumstances into
consideration, reasonably be expected to result in greater value to the
Unitholders than the transactions contemplated by this Agreement and (B)&nbsp;before
furnishing or disclosing any non-public information to, or entering into
discussions or negotiations with, the Third Party, the Company receives from
the Third Party an executed confidentiality agreement with terms no less
favorable in the aggregate to the Company than those contained in the
Confidentiality Agreement, dated as of February&nbsp;28, 2002 (as amended, the
&#147;Confidentiality Agreement&#148;), among each of Lima and the Company, which
confidentiality agreement does not provide for any exclusive right to negotiate
with the Company or payments by the Company. Nothing in this Section will
prohibit the Company from complying with Rule&nbsp;14e-2 and Rule&nbsp;14d-9 under the
Exchange Act with regard to a tender offer or an exchange offer or prohibit the
Company from selling assets or properties in the ordinary course of business.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;The Company will (i)&nbsp;no later than the end of the first business day
after the Company receives an inquiry, proposal or offer with respect to a
possible Acquisition Transaction or a request for non-public information
relating to the Company in connection with a possible Acquisition Transaction
or for access to its or any of its subsidiaries&#146; properties, books or records
by any Third Party that informs the General Partners that the Third Party is
considering making, or has made, a proposal or offer with respect to an
Acquisition Transaction (any such inquiry proposal, offer or request being an
&#147;Acquisition Proposal&#148;), notify Parent in writing of the inquiry, proposal,
offer or request, (ii)&nbsp;in that written notice, indicate in reasonable detail
the identity of the Third Party (including the name of the Third Party) and the
terms and conditions of the proposal or offer, (iii)&nbsp;promptly notify Parent of
any determination by the General Partners that the Company should furnish
information to, or engage in discussions or negotiations with, any Third Party,
and (iv)&nbsp;keep Parent informed of the progress of any discussions or
negotiations with any Third Party.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;The Company will immediately cease and cause to be terminated any
existing activities, discussions or negotiations with any parties (other than
Parent) which are currently being conducted before the date of this Agreement
with respect to any possible Acquisition Transaction, and will inform any such
parties of the Company&#146;s obligations under this Section&nbsp;5.7.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.8 Company Financial Information. To the extent Lima is required under
the Securities Act or the Exchange Act and/or the rules promulgated thereunder
or determines to include in any of their respective SEC filings to be made
between the execution and delivery of this Agreement and the Merger Date the
Company&#146;s financial statements or financial information (in whole or in part)
for any period or periods prior to the Merger Date (including prior years&#146;
financial statements or information), the Company agrees to make such financial
statements and information available to Lima and to cause its independent
public accounts to discuss same and
</FONT>

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<P align="left"><FONT size="2">cooperate with Lima in order for Lima to be
able to include such financial statements and information in their respective
SEC filings.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.9 Company Disclosure Letter. Notwithstanding anything to the contrary
contained herein, Lima, Parent and Acquisition acknowledge that the Company
Disclosure Letter has not yet been delivered to them and the Company covenants
and agrees to deliver to Parent, as soon as practicable but in no event later
than seven (7)&nbsp;days after the date of this Agreement (the &#147;Delivery Date&#148;), the
Company Disclosure Letter in form reasonably satisfactory to Parent. In the
event that such Company Disclosure Letter is not delivered to Parent on or
before the Delivery Date, the Due Diligence Termination Date shall be extended
by the number of days after the Delivery Date on which such Company Disclosure
Letter was delivered to Parent.
</FONT>
<P align="center"><FONT size="2"><B>ARTICLE 6<BR>
CONDITIONS</B>
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1 Conditions to the Company&#146;s Obligations. The obligations of the
Company to complete the Merger are subject to satisfaction on or before the
Merger Date of the following conditions (any or all of which may be waived by
the Company):
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;The representations and warranties of Lima, Parent and Acquisition
contained in this Agreement will, except as contemplated by this Agreement, be
true and correct on the Merger Date with the same effect as though made on that
date except that representations or warranties which relate expressly to a
specified date or a specified period need only have been true and correct
(without giving effect to any qualifications as to &#147;materiality&#148; or any
&#147;material adverse effect&#148; set forth therein) in all material respects with
respect to the specified date or period, and Lima and Parent will have
delivered to the Company a certificate dated that date and signed by the
president or a vice president or similar representative of Lima and Parent to
that effect.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;Lima, Parent and Acquisition will have fulfilled in all material
respects all their obligations under this Agreement required to have been
fulfilled on or before the Merger Date, and Lima and Parent will have delivered
to the Company a certificate dated that date and signed by the president or a
vice president or similar representative of Lima and Parent to that effect.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;Lima or Parent will have delivered to the Company reasonable evidence
that the monies required to pay the Merger Consideration have been or
concurrently with the filing of the Certificate or Merger will be wire
transferred, in the form of immediately available funds, to the Distributing
Agent.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2 Conditions to Parent&#146;s, Lima&#146;s and Acquisition&#146;s Obligations. The
obligations of Parent, Lima and Acquisition to complete the Merger are subject
to satisfaction on or before the Merger Date of the following conditions (any
or all of which may be waived by Parent):
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;The representations and warranties of the Company contained in this
Agreement will be true and correct in all respects (without giving effect to
any qualifications as to &#147;materiality&#148; or any &#147;Material Adverse Effect on the
Company&#148; set forth therein) on the Merger Date with the same effect as though
made on that date (except that representations or
</FONT>


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<P align="left"><FONT size="2">warranties which relate
expressly to a specified date or a specified period need only have been true
and correct with regard to the specified date or period), except where the
failure of such
representations and warranties to be true and correct (without giving
effect to any qualifications as to &#147;materiality&#148; or any &#147;Material Adverse
Effect on the Company&#148; set forth therein) would not, individually or in the
aggregate, result in a Material Adverse Effect on the Company; and the Company
will have delivered to Parent a certificate dated that date and signed by the
president or a vice president of the Managing General Partner to that effect.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;The Company will have fulfilled in all material respects all its
obligations under this Agreement required to have been fulfilled on or before
the Merger Date.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;No action will be pending against the Company, Lima, Parent or
Acquisition relating to the transactions which are the subject of this
Agreement which presents a reasonable likelihood of resulting in an award of
damages against the Company, Lima, Parent, Acquisition or the Surviving
Partnership which, in the case of the Company or the Surviving Partnership,
would reasonably be expected to have a Material Adverse Effect on the Company
or the Surviving Partnership or, in the case of the other foregoing entities,
would reasonably be expected to have a material adverse effect on them.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;Since the date of this Agreement, no events will have occurred and no
circumstances will have occurred that, individually or in the aggregate, have
resulted in or would reasonably be expected to result in a Material Adverse
Effect on the Company.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;The Company will have delivered to Parent reasonable evidence that any
of the Escrow Fund released to the Company prior to the Merger Date has been or
concurrently with the filing of the Certificate of Merger will be wire
transferred, in the form of immediately available funds, to the Distributing
Agent.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3 Conditions to the Parties&#146; Obligations. The obligations of each of
the parties to complete the Merger are subject to satisfaction on or before the
Merger Date of the following conditions (any or all of which may be waived by
the parties, except as prohibited by applicable law):
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Any waiting period under the HSR Act with regard to the Merger will
have expired or been terminated, without the imposition of any cost,
restriction or requirement on the operation of the Surviving Partnership&#146;s
business that would reasonably be expected to have a Material Adverse Effect on
the Company (including the Surviving Partnership).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;The Utilities Commission will have approved the transfer of a
controlling interest in the capital stock of Valencia Water Company, a
California corporation, as a result of the Merger, without the imposition of
any cost or restriction on the operation of the Surviving Partnership&#146;s
business that would be reasonably expected to have a Material Adverse Effect on
the Company (including the Surviving Partnership).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;No statute, rule or regulation will have been enacted or promulgated
by any governmental authority which prohibits the consummation of the Merger,
and there will be no order or injunction of a court of competent jurisdictions
in effect precluding the consummation of the Merger.
</FONT>


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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;The principal terms of the Merger will have been approved by the
holders of a majority of the Units entitled to vote on the matter.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;No order will have been entered by any court or governmental authority
and be in force which invalidates this Agreement or materially restrains
Parent, Acquisition or the Company from completing the transactions which are
the subject of this Agreement.
</FONT>

<P align="center"><FONT size="2"><B>ARTICLE 7<BR>
TERMINATION</B>
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1 Right to Terminate. This Agreement may be terminated at any time
prior to the Effective Time (whether or not the Unitholders have approved the
principal terms of the Merger):
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;By mutual written consent of the Company (after receiving approval
from the General Partners) and Parent.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;By the Company if (i)&nbsp;it is determined that there has been a breach of
any of the representations and warranties of Lima, Parent or Acquisition
contained in this Agreement which would result in the failure of the condition
set forth in Section&nbsp;6.1(a) to be satisfied as of the time such representation
or warranty shall have been breached (assuming the Merger Date were as of such
time), or (ii)&nbsp;if Lima, Parent or Acquisition has breached any of their
respective obligations contained in this Agreement which would result in the
failure of the condition set forth in Section&nbsp;6.1(b) to be satisfied as of the
time of such breach (assuming the Merger Date were as of such time); <I>provided</I>,
<I>however</I>, that, if a breach of Lima&#146;s, Parent&#146;s or Acquisition&#146;s
representations, warranties or obligations occurring as of a date subsequent to
the date of this Agreement is curable by such parties and such parties are
continuing to exercise all reasonable efforts to cure such breach, then the
Company may not terminate this Agreement under this Section&nbsp;7.1(b) on account
of such breach until 10 business days subsequent to the date of such breach if
such breach has not been cured.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;By Parent, on or before the Due Diligence Termination Date, if Parent
(in its subjective judgment made in its sole discretion) is not satisfied with
the results of its due diligence investigation of the Company.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;By Parent if (i)&nbsp;it is determined that there has been a breach of any
of the representations and warranties of the Company contained in this
Agreement which would result in the failure of the condition set forth in
Section&nbsp;6.2(a) to be satisfied as of the time such representation or warranty
shall have been breached (assuming the Merger Date were as of such time), or
(ii)&nbsp;if the Company has breached any of its obligations contained in this
Agreement which would result in the failure of the condition set forth in
Section&nbsp;6.2(b) to be satisfied as of the time of such breach (assuming the
Merger Date were as of such time); <I>provided</I>, <I>however</I>, that, if a breach of the
Company&#146;s representations, warranties or obligations occurring as of a date
subsequent to the date of this Agreement is curable by the Company and the
Company is continuing to exercise all reasonable efforts to cure such breach,
then Parent may not terminate this Agreement under this Section&nbsp;7.1(d) on
account of such breach until 10 business days subsequent to the date of such
breach if such breach has not been cured.
</FONT>


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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;By either Parent or the Company if the Merger is not consummated on or
before December&nbsp;31, 2004 which date will be extended to March&nbsp;31, 2005 if the
required approval under the PUA has not been received from the Utilities
Commission or if such order has been stayed or enjoined as of December&nbsp;31, 2004
(such date, as may be extended hereunder, being referred to as the &#147;Outside
Termination Date&#148;); <I>provided</I>, <I>however</I>, that the right to terminate this
Agreement pursuant to this Section&nbsp;7.1(e) will not be available to any party
whose failure to perform or observe in any material respect any of its
obligations under this Agreement has been the cause of, or resulted in, the
failure of the Merger to occur on or before the Outside Termination Date.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;By either Parent or the Company, if any court of competent
jurisdiction or other governmental authority issues an order (other than a
temporary restraining order), decree or ruling, or takes any other action,
restraining, enjoining or otherwise prohibiting the Merger, and that order,
decree, ruling or other action becomes final and nonappealable.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;By either Parent or the Company, if the Unitholders fail to approve
the principal terms of the Merger at the Company Meeting.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;By Parent, if the General Partners (i)&nbsp;withdraw, change or modify in a
manner materially adverse to Parent their recommendation that the Unitholders
vote to approve the principal terms of the Merger; or (ii)&nbsp;adopt resolutions
approving or otherwise authorizing or recommending or otherwise approve,
authorize or recommend an Acquisition Transaction (other than the Merger) to
the Unitholders.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;By the Company, if before the principal terms of the Merger are
approved by the holders of the majority of the Units entitled to vote on the
matter at the Company Meeting (i)&nbsp;the Company or either of its General Partners
receives an Acquisition Proposal in which a person or group (a &#147;Potential
Acquiror&#148;) makes a specific proposal for an Acquisition Transaction on specific
terms (a &#147;Firm Proposal&#148;), or a Potential Acquiror commences a cash tender
offer or exchange offer for at least 50% of the then outstanding Units (other
than any Units already owned by the Potential Acquiror), (ii)&nbsp;within ten (10)
days after the Company or its General Partners receives the Firm Proposal or
the tender offer or exchange offer is commenced, the General Partners determine
that the Firm Proposal or the tender offer or exchange offer is a Superior
Proposal and resolves to accept the Superior Proposal, or to recommend that the
Unitholders vote for, authorize, or tender their Units in response to, the
Superior Proposal, (iii)&nbsp;the Company has given Parent at least three (3)
business days&#146; prior notice of the terms of the Superior Proposal (including
the consideration per Unit, which the Unitholders would receive as a result of
the Superior Proposal), and that it intends in three business days to terminate
this Agreement pursuant to this Section&nbsp;7.1(i) unless within the three (3)
business day period Lima and Parent make a written offer that the Company
determines, in good faith after consultation with its financial advisors, is at
least as favorable as the Superior Proposal set forth in the notice, and (iv)
the Company has (A)&nbsp;paid Parent $35&nbsp;million (the &#147;Special Termination Fee&#148;),
(B)&nbsp;reimbursed Parent for all the out-of-pocket expenses which Lima and Parent
or their subsidiaries (including Acquisition) incurred in connection with this
Agreement and the transactions contemplated by it (including reasonable fees
and expenses of professionals and other consultants, commitment fees and other
financing costs, and out of pocket costs incurred by employees in investigating
the business (including the Real Property), operations and
</FONT>


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<P align="left"><FONT size="2">financial
condition of the Company and in connection with the negotiation of this
Agreement and efforts to carry out the transactions which are the subject of
this Agreement) (the &#147;Parent Expenses&#148;) regarding which Parent has presented
reasonable documentation to the Company as of the date of termination (the
&#147;Parent Incurred Expenses&#148;), (C)&nbsp;agreed in writing to reimburse Lima and Parent
for all Parent Expenses for which Parent presents after the date of termination
reasonable documentation to the Company (the &#147;Parent Invoiced Expenses&#148;) as
soon as practicable after the presentation thereof, up to a total reimbursement
of Parent Expenses under clauses (B)&nbsp;and (C)&nbsp;not exceeding $5&nbsp;million, and (D)
either terminated the Escrow Agreement and instructed the Escrow Agent to
return the Escrow Fund it is then holding to Parent, if the Escrow Agent is
then holding any portion of the Escrow Fund, and/or returned any of the Escrow
Fund released to the Company to Parent (without any interest earned after the
Escrow Fund was released to the Company). A &#147;Superior Proposal&#148; is a proposal
for an Acquisition Transaction or a tender offer or exchange offer which would
result in the Unitholders receiving consideration which the General Partners
determine in good faith, considering all relevant factors (including, but not
limited to, financing contingencies, any due diligence out to the extent that
the Due Diligence Termination Date has passed, the financial wherewithal of the
Potential Acquiror to carry out the transaction and the overall likelihood of
consummation) and after consultation with their financial advisor, would
deliver superior value (valuing non-cash consideration at its fair value as
determined in good faith by the General Partners after consultation with their
financial advisor) to the Unitholders (after giving effect to the payment of
the fees and expenses contemplated by clause (iv)) than the transactions
contemplated by this Agreement.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2 Manner of Terminating Agreement. If at any time the Company or Parent
has the right under Section&nbsp;7.1 to terminate this Agreement, it can terminate
this Agreement by a written notice to the other of them that it is terminating
this Agreement; <I>provided</I>, that the right to terminate this Agreement pursuant
to Section&nbsp;7.1(c) may only be exercised on or before the Due Diligence
Termination Date.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3 Effect of Termination. If this Agreement is terminated pursuant to
Section&nbsp;7.1, after this Agreement is terminated, neither party will have any
further rights, obligations or liabilities under this Agreement, other than the
rights and obligations under (a)&nbsp;Section&nbsp;8.1, (b)&nbsp;the agreement to reimburse
expenses described in Section&nbsp;7.1(i), (c)&nbsp;the right of the applicable party to
receive the Escrow Fund then held pursuant to the terms of the Escrow Agreement
and (d)&nbsp;the rights and obligations under Section&nbsp;9.10(b) hereof.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4 Survival. The representations and warranties in this Agreement or in
any certificate delivered pursuant to this Agreement will terminate at the
earlier to occur of the (a)&nbsp;Effective Time or (b)&nbsp;the termination of this
Agreement pursuant to this Article&nbsp;7, and none of the Company, Lima, Parent or
Acquisition, nor any of their respective affiliates, stockholders, members or
partners, as the case may be, will have any rights or claims as a result of any
of those representations or warranties after such time except the
representations and warranties in Sections&nbsp;3.17 and 4.5 shall survive the
termination of this Agreement.
</FONT>
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<P align="center"><FONT size="2"><B>ARTICLE 8<BR>
OTHER AGREEMENTS</B>
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1 Liquidated Damages.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;If at any time prior to or at the Company Meeting (i)&nbsp;the General
Partners withdraw or change or modify in a manner materially adverse to Parent
their recommendation that the Unitholders vote in favor of the principal terms
of the Merger, but (ii)&nbsp;this Agreement is not terminated before the Company
Meeting and (iii)&nbsp;at that Company Meeting, the principal terms of the Merger
are not approved by holders of the majority of the Units entitled to vote on
the matter, within three business days after the day on which that Company
Meeting is held, the Company will (A)&nbsp;return to Parent the amount (without
interest) released to the Company from the Escrow Fund pursuant to the Escrow
Agreement, (B)&nbsp;pay $30&nbsp;million (the &#147;Termination Fee&#148;) to Parent, (C)&nbsp;reimburse
Parent for all Parent Incurred Expenses, (D)&nbsp;agree in writing to reimburse
Parent for all Parent Invoiced Expenses (up to a total reimbursement of Parent
Expenses under clauses (C)&nbsp;and (D)&nbsp;not exceeding $5&nbsp;million) and (E)&nbsp;instruct
the Escrow Agent to release to Parent any of the Escrow Fund then being held by
it. Upon the payment by the Company of the amount (without interest) released
to the Company from the Escrow Fund, the Termination Fee and Parent Expenses to
Parent hereunder and the release by the Escrow Agent to Parent of any of the
Escrow Fund then held by the Escrow Agent, this Agreement will terminate.
Notwithstanding the foregoing, if within twelve months after such termination
the Company consummates a Change of Control Transaction (as defined in Section
8.1(b)) or enters into a definitive agreement for such a transaction, and such
Change of Control Transaction is consummated, the Company will pay an
additional $5&nbsp;million to Parent upon such consummation.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;If the General Partners do not withdraw or change or modify their
recommendation that the Unitholders approve the principal terms of the Merger,
but nonetheless, at the Company Meeting, the principal terms of the Merger are
not approved, within three business days after the day on which the Company
Meeting is held, the Company will (i)&nbsp;reimburse Parent for all Parent Incurred
Expenses and will agree in writing to reimburse Parent for all Parent Invoiced
Expenses (up to a total reimbursement of all Parent Expenses not exceeding $5
million), (ii)&nbsp;will return to Parent any of the Escrow Fund released to the
Company (without any interest earned after it was released to the Company),
(iii)&nbsp;instruct the Escrow Agent to release to Parent any of the Escrow Fund
then being held by it, and (iv)&nbsp;if on or prior to the Company Meeting there is
a publicly announced proposal for a Change of Control Transaction and within
twelve months after such Company Meeting the Company consummates a Change of
Control Transaction (as defined below) or enters into a definitive agreement
for such a transaction and such Change of Control Transaction is consummated
with the party or parties (including their respective affiliates) that made, or
were the proposed acquiror(s) in, such publicly announced proposal, pay to
Parent on such consummation the Special Termination Fee. A &#147;Change of Control
Transaction&#148; means an Acquisition Transaction which results in the Unitholders
of the Company immediately prior to the transaction owning 50% or less of the
equity or voting power of the Company or of the surviving or successor entity
resulting from or of the purchaser in the transaction.
</FONT>


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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;If this Agreement is terminated pursuant to Section&nbsp;7.1(b), (i)&nbsp;the
Company will retain the Initial Deposit Amount, (ii)&nbsp;the Company will return to
Parent (without any interest earned after it was released to the Company), or
instruct the Escrow Agent to release to Parent (with interest), the Additional
Deposit Amount, (iii)&nbsp;Parent will reimburse the Company for all the
out-of-pocket expenses which the Company incurred in connection with this
Agreement and the transactions contemplated by it (including reasonable fees
and expenses of professionals and other consultants and out of pocket costs
incurred in connection with the negotiation of this Agreement and efforts to
carry out the transactions which are the subject of this Agreement) (the
&#147;Company Expenses&#148;) regarding which the Company has presented reasonable
documentation to Parent as of the date of termination (the &#147;Company Incurred
Expenses&#148;) and (iv)&nbsp;Parent will agree in writing to reimburse the Company for
all Company Expenses for which the Company presents after the date of
termination reasonable documentation to Parent (the &#147;Company Invoiced
Expenses&#148;) as soon as practicable after the presentation thereof, up to a total
reimbursement of Company Expenses under clauses (iii)&nbsp;and (iv)&nbsp;not exceeding $5
million; provided, however, that, if the termination by the Company is as a
result of an intentional or willful breach or intentional or willful
misrepresentation by Lima, Parent or Acquisition, the Company will also retain
the entire Escrow Fund and, to the extent that the Escrow Agent then holds any
of the Escrow Fund, the Parent will instruct the Escrow Agent to release to the
Company any of the Escrow Fund then being held by it.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;If this Agreement is terminated by Parent pursuant to Section&nbsp;7.1(c),
then the Company shall retain the Initial Deposit Amount (along with any
interest accrued thereon).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;If this Agreement is terminated by Parent pursuant to Section&nbsp;7.1(d),
the Company will (i)&nbsp;return to Parent the amount (without any interest earned
after it was released to the Company) released to the Company from the Escrow
Fund, (ii)&nbsp;instruct the Escrow Agent to release to Parent any of the Escrow
Fund then being held by it, (iii)&nbsp;reimburse Parent for all Parent Incurred
Expenses and (iv)&nbsp;agree in writing to reimburse all Parent Invoiced Expenses
(up to a total reimbursement of Parent Expenses under clauses (iii)&nbsp;and (iv)
not exceeding $5&nbsp;million); provided, however, that, if termination by Parent is
as a result of the intentional or willful breach or intentional or willful
misrepresentation by the Company, (a)&nbsp;the Company shall also pay the
Termination Fee to Parent and (b)&nbsp;the Company shall have the obligations, and
Parent shall have the right to reinstate this Agreement, as set forth in
Section&nbsp;9.10(b)(i)(B) to the same extent and as if this Agreement had been
terminated by the Company pursuant to Section&nbsp;9.10(b).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;If this Agreement is terminated pursuant to Section&nbsp;7.1(e), then the
Company (i)&nbsp;will retain the Initial Deposit Amount (along with any interest
accrued thereon) and (ii)&nbsp;return to Parent (without any interest earned after
it was released to the Company), or instruct the Escrow Agent to release to
Parent (with interest), the Additional Deposit Amount.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;If this Agreement is terminated pursuant to Section&nbsp;7.1(f), the
Company will return and/or cause the Escrow Agent to return to Parent the
Escrow Fund (without any interest earned after it was released to the Company).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;If all conditions in Section&nbsp;6.2 and all conditions in Section&nbsp;6.3
have been satisfied prior to the Merger Date, and within seven business days
thereof the Merger is not
</FONT>


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<P align="left"><FONT size="2">consummated due to any action or inaction by Lima, Parent or Acquisition,
then, and without limiting Company&#146;s rights under Article&nbsp;7, the other
provisions of this Section&nbsp;8.1 or under Section&nbsp;9.10, the Company will retain
the entire Escrow Fund that has been released to it and, to the extent that the
Escrow Agent then holds any of the Escrow Fund, the Parent will instruct the
Escrow Agent to release to the Company any of the Escrow Fund then being held
by it.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;If all conditions in Section&nbsp;6.1 and all conditions in Section&nbsp;6.3
have been satisfied prior to the Merger Date, and within seven business days
thereof the Merger is not consummated due to any action or inaction by the
Company, then, and without limiting Lima&#146;s and Parent&#146;s rights under Article&nbsp;7,
the other provisions of this Section&nbsp;8.1 or under Section&nbsp;9.10, the Company
will (i)&nbsp;return to Parent the amount (without any interest earned after it was
released to the Company) released to the Company from the Escrow Fund and, (ii)
to the extent that the Escrow Agent then holds any of the Escrow Fund, the
Company will instruct the Escrow Agent to release to Parent any of the Escrow
Fund then being held by it.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)&nbsp;The parties irrevocably stipulate that actual damages in the event of
a termination of this Agreement would be extremely difficult or impracticable
to determine. Accordingly, but subject, however, to Section&nbsp;9.10, the Company,
Lima, Parent and Acquisition each acknowledge and agree that given the
circumstances in effect at the time this Agreement is executed, the payments
set forth in this Section&nbsp;8.1 constitute liquidated damages and, if a party
seeks the remedy of damages hereunder, a reasonable calculation of damages
designed to compensate for injuries suffered as a result of termination of this
Agreement. If any of the parties hereto challenge the applicability or
efficacy of this Section&nbsp;8.1 or if this provision is held to be void or
unenforceable for any reason, the other party will be entitled to any and all
other damages and remedies otherwise provided at law, including attorneys&#146;
fees.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2 Other Actions; Filings; Consents. Subject to the terms and conditions
contained in this Agreement, Lima, Parent, Acquisition and the Company each
will (a)&nbsp;use its commercially reasonable efforts to take, or cause to be taken,
all actions, and to do, or cause to be done, all other things, which are
necessary, proper or appropriate under applicable laws and regulations, or are
required to be taken by any governmental authorities, to consummate the Merger
as promptly as practicable, (b)&nbsp;use its commercially reasonable efforts to make
as promptly as practicable all necessary filings, and subsequently make any
other required submissions, with regard to this Agreement or the Merger under
(i)&nbsp;the Exchange Act and any other applicable federal or state securities laws
or regulations, (ii)&nbsp;the HSR Act and any related governmental requests under
that HSR Act, (iii)&nbsp;the PUA and any related governmental or quasi-governmental
requests under the PUA and (iv)&nbsp;any other applicable or federal, state, local
or foreign statutes, laws, rules or regulations, (c)&nbsp;use its commercially
reasonable efforts to obtain from governmental authorities any consents,
licenses, permits, waivers, approvals, authorizations and orders required to be
obtained by the Company or Parent or any of their respective subsidiaries in
connection with the authorization, execution and delivery of this Agreement and
the consummation of the Merger and the other transactions contemplated by this
Agreement, (d)&nbsp;use its commercially reasonable efforts to resolve any
objections which may be asserted by any governmental authority with regard to
the Merger or any other transactions contemplated by this Agreement under any
anti-trust, trade or regulatory laws or regulations, (e)&nbsp;furnish the other of
them, upon request, with copies of all correspondence, filings and
communications between it and its affiliates and representatives, on the one
hand, and any governmental authority or
</FONT>
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<P align="left"><FONT size="2">member of the staff of any governmental authority, on the other hand, with
respect to this Agreement, the Merger or any other of the transactions
contemplated by this Agreement, (f)&nbsp;furnish the other of them with all
information and reasonable assistance which the other of them may reasonably
request in connection with the preparation of filings, registrations or
submissions of information required by any governmental authorities, (g)&nbsp;use
its commercially reasonable efforts to cause any injunction, restraining order
or other order of any court or governmental authority which adversely effects
the ability of the parties to consummate the Merger to be dissolved, and to
defend vigorously any litigation seeking to enjoin, prevent or delay the
consummation of the Merger or seeking material changes in the terms of the
Merger or any other transaction which is the subject to this Agreement, and (h)
use commercially reasonable efforts to cause the conditions in Article&nbsp;6 to be
satisfied as promptly as practicable.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3 Notification of Certain Matters. The Company will cause one or more
of its representatives to confer on a regular and frequent basis with Parent&#146;s
Representatives and to report to Parent and Parent&#146;s Representatives on the
general status of its ongoing operations. Each party will give prompt notice
to the other party of (a)&nbsp;any written notice or other communication from any
third party alleging that the consent of that third party is or may be required
in connection with the Merger or other transactions contemplated by this
Agreement, (b)&nbsp;its receipt of written notice of any governmental complaint,
investigation or hearing, or any litigation, which may impair the parties&#146;
ability to consummate the Merger or any of the other transactions contemplated
by this Agreement or may have a Material Adverse Effect on the Company, (c)&nbsp;any
change, event, fact or circumstance that, in the party&#146;s good faith judgment,
is reasonably likely to impair the party&#146;s ability to consummate the Merger or
is reasonably likely to have a Material Adverse Effect on the Company or (d)
the occurrence or the existence of any event that would, or could with a
passage of time or otherwise, make any representation or warranty in this
Agreement untrue.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4 Post-Closing Tax Matters.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Acquisition General Partner will, from and after the Effective Time,
be the successor Tax Matters Partner of the Company (the &#147;TMP&#148;), within the
meaning of Section&nbsp;6231 of the Code, with respect to all Taxable years of the
Company and as of the closing assumes the duties of the Managing General
Partner, as the current TMP, to the Unitholders. As TMP and subject to the
provisions and requirements of the Code, Acquisition General Partner will
represent the Company and control the handling of any Tax audit, investigation
or assessment against the Company, regardless of the Taxable year to which such
audit, investigation or assessment relates. In exercising its duties as TMP,
Acquisition General Partner will have the right to employ counsel of its choice
at its expense and to control the conduct of such audit, investigation,
assessment or proceeding, including settlement or other disposition thereof and
to settle the contest of any Tax or agree to an adjustment to any Tax or
partnership item. Notwithstanding the preceding sentence, Acquisition General
Partner will neither consent nor agree to the settlement of any dispute
regarding Taxes for any Taxable period (or portion thereof) ending on or prior
to the Merger Date if such settlement would reasonably be expected to have a
material adverse impact on the Unitholders without the prior written consent of
the Managing General Partner (or any successor person or entity), which consent
will not be unreasonably withheld or delayed. Notwithstanding the foregoing,
the Managing General Partner will prepare and file all income and franchise Tax
Returns of the Company due after the
</FONT>


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<P align="left"><FONT size="2">Merger Date (taking into account applicable extensions of time for filing)
with respect to any Taxable period (or portion thereof) ending on or prior to
the Merger Date. In connection with the foregoing, the Managing General
Partner will submit drafts of all income and franchise Tax Returns to the
Acquisition General Partner no later than twenty days prior to the filing date
and will not file such Tax Returns without the prior written consent of the
Acquisition General Partner (or any successor person or entity), which consent
will not be unreasonably withheld or delayed.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;The parties acknowledge that pursuant to the Company&#146;s currently
effective election under Section&nbsp;754 of the Code, the tax basis of the
Company&#146;s assets will be adjusted pursuant to Sections&nbsp;743 and 755 of the Code
upon the Merger. Acquisition General Partner and the Managing General Partner
shall cooperate to prepare, within a reasonable time after the Effective Time,
a schedule (the &#147;Allocation Schedule&#148;) allocating the Merger Consideration, the
liabilities of the Company and any other applicable amounts among the assets
and properties of the Company in accordance with Section&nbsp;755 and Section
1.755-2T of the Treasury Regulations thereunder which will be consistent with
the allocation of the value of assets and properties between the members of
Parent. The Allocation Schedule so arrived at shall be used by (i)&nbsp;Acquisition
General Partner in determining and reporting the basis of the Company&#146;s assets
for federal (and all applicable state) income tax purposes, and (ii)&nbsp;the
Managing General Partner in preparing reports to the respective Unitholders
enabling them to report their taxable income from the Merger and to comply with
Section&nbsp;1.751-1(a)(3) of the Treasury Regulations (&#147;Partner Reports&#148;). The
Managing General Partner shall prepare and provide the Partner Reports to the
Acquisition General Partner for approval within thirty days after the
Allocation Schedule is finally completed. The Managing General Partner shall
not forward the Partner Reports to the Unitholders until approved by the
Acquisition General Partner, which approval shall not be unreasonably withheld
or delayed. The parties further agree that, in reporting the Merger for
federal (and applicable state) income tax purposes, they shall treat any amount
of the Escrow Fund released to the Company and then paid to the Unitholders as
constituting additional Merger Consideration.
</FONT>

<P align="center"><FONT size="2"><B>ARTICLE 9<BR>
GENERAL</B>
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1 Expenses. Except as provided in Sections&nbsp;7.1(i) and 8.1, the Company,
Lima, Parent and Acquisition will each pay its own expenses in connection with
the transactions which are the subject of this Agreement, including legal fees.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2 Employee Benefit Plans.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Lima and Parent agree to provide (or cause the Surviving Partnership
to provide) to employees of the Surviving Partnership as of the Merger Date
(the &#147;Surviving Employees&#148;), where any of Lima or Parent provide substantially
similar type benefits as provided by the Company prior to the Merger Date,
employee benefits as provided to similarly situated employees of Lima, Parent
or any of their respective Affiliates, <I>provided </I>that where the Company provided
higher levels of benefits Lima or Parent shall provide such higher levels or
the substantial economic equivalent of such. Lima or Parent shall credit or
cause the Surviving Partnership to credit Surviving Employees with service
credit for their period of employment
</FONT>


<P align="center"><FONT size="2">- 35 -</FONT>




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<P align="left"><FONT size="2">with the Company for eligibility and vesting purposes under any Lima or
Parent plan that is qualified under Section&nbsp;401(a) of the Code that is
applicable to the Surviving Employees. Lima and Parent will and will cause the
Surviving Partnership to waive all pre-existing condition exclusions with
respect to group health plans maintained for the benefit of Surviving Employees
(to the extent such pre-existing conditions were satisfied prior to the Merger
Date under the Company&#146;s group health plans) and provide that each such
Surviving Employee will be given credit for all deductible payments and
co-payments paid by such employee under the Company&#146;s group health plans prior
to the Merger Date during the current year for purposes of determining the
extent to which any such employee has satisfied any deductible or maximum
out-of-pocket limitation under such plan for such plan year.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;From and after the Effective Time, Lima and Parent agree to maintain
or to cause one of its affiliates to maintain the severance plans, and the
non-qualified deferred compensation plans that supplement qualified retirement
plans set forth in Section&nbsp;9.2(b) of the Company Disclosure Letter, without any
material modification, in accordance with their terms; provided, however, that
Lima and Parent shall have the right to terminate the foregoing plans at any
time on or after the Merger Date subject to paying out the accrued benefits
thereunder as of such date of termination. The provisions of this Section&nbsp;9.2
are intended to be for the benefit of, and shall be enforceable by, each of the
covered Company employees.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;Nothing in this Section&nbsp;9.2 shall create any right to employment nor
make any person&#146;s employment other than &#147;at will.&#148;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.3 Insurance and Indemnification.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;The Surviving Partnership will at all times after the Effective Time
indemnify and hold harmless each person who is at the date of this Agreement,
or has been at any time prior to the date of this Agreement, a general partner
of the Company (or any general partner, officer or director thereof) or a
managing member, general partner, director, officer or employee of any of their
respective subsidiaries (&#147;Indemnified Parties&#148;), in each case to the fullest
extent permitted by applicable law, with respect to any claim, liability, loss,
damage, cost, fees (including reasonable attorneys&#146; fees) or expense (whenever
asserted or claimed) based in whole or in part, or arising in whole or in part
out of, any act or omission by that person at or prior to the Effective Time in
connection with that person&#146;s duties as a general partner, managing member,
director, officer or employee, to the same extent and on the same terms
(including with respect to advancement of expenses) provided in the relevant
limited partnership agreement, operating agreement or articles of
incorporation, or in any indemnification agreements, in effect on the date of
this Agreement. The Surviving Partnership will pay all reasonable expenses,
including attorney&#146;s fees that may be incurred by any Indemnified Party in
enforcing the indemnity and other obligations of the Surviving Partnership
under this Section&nbsp;9.3.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;Lima and Parent will cause the Surviving Partnership to keep in effect
(at no less than their current levels of coverage) for at least six years after
the Effective Time the policies or tail liability coverage of (i)&nbsp;general
partners&#146; liability insurance maintained by the General Partners and/or Company
and (ii)&nbsp;either directors and officers&#146; liability insurance, general partner&#146;s
liability insurance or managing member liability insurance, as the case may be,
maintained by the General Partners, the Company, their respective subsidiaries
at the date of this
</FONT>


<P align="center"><FONT size="2">- 36 -</FONT>
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<P align="left"><FONT size="2">Agreement; provided that (A)&nbsp;Lima and Parent may substitute policies
having comparable coverage and amounts and containing similar terms and
conditions which are no less advantageous to the persons who are currently
covered by those policies and with carriers comparable in terms of credit
worthiness to those which have written those policies and (B)&nbsp;neither Lima,
Parent nor the Surviving Partnership will be required to pay an annual premium
for that insurance in excess of three times the annual premium relating to the
year during which this Agreement is executed, but if they are not able to
maintain the required insurance for an annual premium for that amount, they
will purchase as much coverage as it can obtain for that amount.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.4 Benefit of Provisions. The provisions of Sections&nbsp;9.2 and 9.3 are
intended for the benefit of, and will be enforceable by, the parties who are
entitled to benefits or rights under those Sections.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.5 Access to Properties, Books and Records. Subject to Section&nbsp;5.1 from
the date of this Agreement until the Effective Time, the Company will, and will
cause each of its subsidiaries to, give Parent&#146;s Representatives reasonable
access during normal business hours to all of their respective properties,
books, records, contracts and agreements, reports, evaluations, title policies,
financial and other information and files and cause its independent public
accountants to make their audit work papers available to Parent&#146;s
Representatives and to answer questions related thereto and to the Company&#146;s
financial statements. Parent will, and will cause Parent&#146;s Representatives to,
hold all information received as a result of access to the properties, books
and records of the Company or its subsidiaries in confidence in compliance with
the Confidentiality Agreement. If this Agreement is terminated prior to the
Effective Time, Parent will, at the request of the Company, deliver to the
Company all documents and other material obtained by Parent and Parent&#146;s
Representative&#146;s from the Company or any of its subsidiaries in connection with
the transactions which are the subject of this Agreement or evidence that that
material has been destroyed by Parent.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.6 Press Releases; Tax Matters Disclosure. The Company and Lima, Parent
and Acquisition will consult with each other before issuing any press release
or otherwise making any public statement with respect to this Agreement or the
Merger, except that nothing in this Section will prevent either party from
making any statement when and as required by law or by the rules of any
securities exchange or securities quotation or trading system on which
securities of that party or an affiliate are listed, quoted or traded.
Notwithstanding anything to the contrary set forth in this Agreement, any party
to this Agreement (and any employee, shareholder, representative or other agent
of any party hereto) may disclose to any and all persons without limitation of
any kind, the tax treatment and tax structure of the Merger and all materials
of any kind (including opinions or other tax analyses) that are provided to the
party relating to such tax treatment and tax structure; <I>provided however</I>, that,
such disclosure may not be made to the extent reasonably necessary to comply
with any applicable federal or state securities laws; <I>provided further </I>that for
the purposes of this Section&nbsp;9.6, (i)&nbsp;the &#147;tax treatment&#148; of the Merger means
the purported or claimed federal income tax treatment of the Merger, and (ii)
the &#147;tax structure&#148; of the Merger means any fact that may be relevant to
understanding the purported or claimed federal income tax treatment of the
Merger. The preceding sentence is intended to cause the Merger to be treated
as not having been offered under conditions of confidentiality for purposes of
Section&nbsp;1.6011-4(b)(3) (or any successor provision) of the Treasury Regulations
</FONT>
<P align="center"><FONT size="2">- 37 -</FONT>
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<P align="left"><FONT size="2">promulgated under Section&nbsp;6011 of the Internal Revenue Code of 1986, as
amended, and shall be construed in a manner consistent with such purpose.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.7 Entire Agreement. This Agreement, the Confidentiality Agreement and
the documents to be delivered in accordance with this Agreement contain the
entire agreement among the Company, Lima, Parent and Acquisition relating to
the transactions which are the subject of this Agreement and those other
documents, all prior negotiations, understandings and agreements between the
Company and either Lima, Parent or Acquisition are superseded by this Agreement
and those other documents, and there are no representations, warranties,
understandings or agreements concerning the transactions which are the subject
of this Agreement or those other documents other than those expressly set forth
in this Agreement or those other documents.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.8 Interpretation.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Whenever the words &#147;include,&#148; &#147;includes&#148; or &#147;including&#148; are used in
this Agreement, they will be deemed to be followed by the words &#147;without
limitation.&#148;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;The words &#147;hereof,&#148; &#147;herein&#148; and &#147;herewith&#148; and words of similar
import will, unless otherwise stated, be construed to refer to this Agreement
as a whole and not to any particular provision of this Agreement, and article,
section, paragraph, exhibit and schedule references are to the articles,
sections, paragraphs, exhibits and schedules of and to this Agreement unless
otherwise specified.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;The plural of any defined term will have a meaning correlative to such
defined term, and words denoting any gender will include both genders and the
neuter. Where a word or phrase is defined herein, each of its other
grammatical forms will have a corresponding meaning.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;A reference to any party to this Agreement or any other agreement or
document will include such party&#146;s successors and permitted assigns.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;A reference to any legislation or to any provision of any legislation
will include any modification, amendment or re-enactment thereof, any
legislative provision substituted therefor and all rules, regulations and
statutory instruments issued thereunder or pursuant thereto.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;The parties have participated jointly in the negotiation and drafting
of this Agreement. If an ambiguity or question of intent or interpretation
arises, this Agreement will be construed as if drafted jointly by the parties,
and no presumption or burden of proof will arise favoring or disfavoring any
party by virtue of the authorship of any provisions of this Agreement.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;No prior draft nor any course of performance or course of dealing will
be used in the interpretation or construction of this Agreement.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;The descriptive headings in this Agreement are intended for reference
purposes only and will not be used in the interpretation or construction of
this Agreement.
</FONT>


<P align="center"><FONT size="2">- 38 -</FONT>
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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.9 Prohibition Against Assignment. Neither this Agreement nor any right
of any party under it may be assigned.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.10 Intentional Failure to Perform Obligations; Termination Post 270 Days
after Date of this Agreement.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;The Company, on the one hand, and Lima, Parent and Acquisition, on the
other hand, each acknowledges and agrees that they would be damaged irreparably
in the event any of the provisions of this Agreement are intentionally or
willfully not performed by the other party in accordance with their specific
terms or otherwise are intentionally or willfully breached and that actual
damages would be impossible to determine. Accordingly, and notwithstanding
anything to the contrary contained herein, the parties agree that the
performing or non-breaching party shall be entitled to an injunction or
injunctions (temporary and permanent) and other equitable relief to prevent
intentional or willful breaches of or failures to perform any of the provisions
of this Agreement that occur within 270&nbsp;days of the date of this Agreement and
in consequence to enforce specifically this Agreement and the terms and
provisions hereof.
</FONT>


<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;Notwithstanding anything to the contrary contained herein, if at any
time after 270&nbsp;days of the date of this Agreement and prior to any termination
of this Agreement pursuant to any provision of Article&nbsp;7 either the Company, on
the one hand, or Lima, Parent and Acquisition, on the other hand, desires to
terminate this Agreement and all of its or their obligations hereunder (other
than as set forth hereinbelow), such party or parties (as the case may be)
shall have the right to do so by delivering to the other party(ies) written
notice thereof and:
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;with respect to the Company&#146;s termination under this Section&nbsp;9.10(b):
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A)&nbsp;the Company will, concurrently with delivering such notice to the
other parties, (1)&nbsp;return to Parent the amount (without interest) released to
the Company from the Escrow Fund pursuant to the Escrow Agreement and instruct
the Escrow Agent to release to Parent any of the Escrow Fund then being held by
it, (2)&nbsp;pay the Termination Fee to Parent, (3)&nbsp;reimburse Parent for all Parent
Incurred Expenses and (4)&nbsp;deliver to Parent an agreement in writing to
reimburse Parent for all Parent Invoiced Expenses (up to a total reimbursement
of Parent Expenses under clauses (3)&nbsp;and (4)&nbsp;not exceeding $5&nbsp;million); and
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B)&nbsp;if the Company desires to enter into a definitive agreement for or
consummate a Change of Control Transaction with a Third Party within 270&nbsp;days
after the date of termination by the Company under this Section&nbsp;9.10(b), the
Company shall be obligated to so advise Lima and Parent in writing prior to
entering into any definitive agreement for or consummating such Change of
Control Transaction and Lima and Parent shall have the right to reinstate this
Agreement in its entirety as if this Agreement had not been terminated by
delivering, within ten (10)&nbsp;business days after the receipt of such written
notice of such Change of Control Transaction, written notice thereof to the
Company, together with returning to the Company the Termination Fee paid by the
Company, and returning the Escrow Fund to the Company and/or the Escrow Agent,
as applicable based upon where the Escrow Fund was held immediately prior to
such termination, and, if this Agreement is timely reinstated by Lima and
Parent, then:
</FONT>


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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;the Company, on the one hand, and Lima, Parent and Acquisition, on the
other hand, shall proceed using best efforts to complete the Merger and, in
connection therewith, to satisfy all unsatisfied conditions and covenants
hereunder as expeditiously and as soon as possible thereafter; and
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;notwithstanding anything to the contrary contained in this Agreement
(including, without limitation, Article&nbsp;7 or 8 or Section&nbsp;9.10(a)), Lima,
Parent and Acquisition shall be entitled to an injunction or injunctions
(temporary and permanent) and other equitable relief in consequence to enforce
specifically this Agreement and the terms and provisions hereof and the
Company&#146;s obligation to complete the Merger.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;with respect to the Parent&#146;s termination under this Section&nbsp;9.10(b),
(A)&nbsp;the Company will retain the entire Escrow Fund then held by it and (B)
Parent will, concurrently with delivering such notice to the Company, (1)
instruct the Escrow Agent to release to the Company any of the Escrow Fund then
being held by it, (2)&nbsp;reimburse the Company for all Company Incurred Expenses
and (3)&nbsp;deliver an agreement in writing to reimburse the Company for all
Company Invoiced Expenses (up to a total reimbursement of Company Expenses
under clauses (2)&nbsp;and (3)&nbsp;not exceeding $5&nbsp;million).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.11 Notices and Other Communications. Any notice or other communication
under this Agreement must be in writing and will be deemed given when it is
delivered in person or sent by facsimile (with proof of receipt at the number
to which it is required to be sent) or on the business day after the day on
which it is sent by a major nationwide overnight delivery service to the
following addresses (or such other address as may be specified after the date
of this Agreement by the party to which the notice or communication is sent):
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="55%">
<TR valign="bottom">
    <TD width="100%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">If to Lima, Parent or Acquisition:</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Lennar Corporation</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">24800 Chrisanta Drive</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Mission Viejo, CA 92691</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Attention: Mr.&nbsp;Jonathan Jaffe</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Facsimile No.: (949)&nbsp;598-8622</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">with a copy (which will not constitute notice) to:</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Bilzin Sumberg Baena Price &#038; Axelrod LLP</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">2500 Wachovia Financial Center</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Miami, Florida 33131-2336</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Attention: Brian L. Bilzin, Esq</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Facsimile No.: (305)&nbsp;374-7593</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">- 40 -</FONT>
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<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="55%">
<TR valign="bottom">
    <TD width="100%">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">LNR Property Corporation</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">1601 Washington Avenue</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Suite&nbsp;800</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Miami Beach, Florida 33139</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Attention: Mr.&nbsp;Jeffrey Krasnoff</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Facsimile No.: (305)&nbsp;695-5449</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">with a copy (which will not constitute notice) to:</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Clifford Chance LLP</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">200 Park Avenue</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">New York, New York 10166-0153</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Attention: David W. Bernstein, Esq</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Facsimile No.: (212)&nbsp;878-8375</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">If to the Company:</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">The Newhall Land and Farming Company</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">23823 Valencia Boulevard</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Valencia, California 91355</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Attention: Gary M. Cusumano</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Facsimile No.: (661)&nbsp;255-4200</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">with a copy (which will not constitute notice) to:</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Paul, Hastings, Janofsky &#038; Walker LLP</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">515 South Flower Street, 25th Floor</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Los Angeles, California 90071</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Attention: Kenneth R. Bender, Esq</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Facsimile No.: (213)&nbsp;627-0705</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.12 Governing Law. This Agreement will be governed by, and construed
under, the substantive laws of the State of California (without regard to any
conflicts of law principles).
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.13 Amendments. This Agreement may be amended only by a document in
writing signed by both the Company, on the one hand, and Parent, Acquisition
and Lima, on the other hand.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.14 Counterparts. This Agreement may be executed in two or more
counterparts, some of which may be signed by fewer than all the parties or may
contain facsimile copies of pages signed by some of the parties. Each of those
counterparts will be deemed to be an original copy of this Agreement, but all
of them together will constitute one and the same agreement.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.15 Assignability; Parties in Interest. This Agreement or the rights or
obligations hereunder shall not be assigned or transferred (in whole or in
part) by operation of law or otherwise except (i)&nbsp;with the prior written
consent of the parties hereto which consent can be arbitrarily withheld, or
(ii)&nbsp;Lima can add an additional member(s) or partner(s) (as the case may be) to
Parent and/or Acquisition so long as (A)&nbsp;Lima remains directly or indirectly in
control by
</FONT>
<P align="center"><FONT size="2">- 41 -</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="left"><FONT size="2">owning at least an aggregate of 50% of the equity voting interests of each
of Parent and Acquisition, (B)&nbsp;Lima remains obligated under this Agreement as
provided herein, (C)&nbsp;such additional member(s) or partner(s) agree in writing
to be obligated under Sections&nbsp;5.3(a) and 5.3(b) of this Agreement to the same
extent as Lima and Parent, and (D)&nbsp;the Company shall have given prior written
consent to the addition of such additional member(s) and/or partner(s),
provided that such consent may only be withheld if in the opinion of the
Company such additional member(s) and/or partner(s) could reasonably be
expected to interfere with the ability of Lima or Parent to fulfill their
obligations under this Agreement or could reasonably be expected to materially
adversely affect the obtaining of the approval of the Utilities Commission of
the transfer of a controlling interest in the capital stock of Valencia Water
Company as a result of the Merger or the timing of obtaining such approval, or
otherwise result in a delay in consummation of the Merger. To the extent that
an additional member(s) an/or partner(s) of Parent or Acquisition is added as
permitted hereunder, the parties agree that the representations and warranties
of Lima, Parent and Acquisition set forth in this Agreement shall be deemed
modified to take into account the ownership of such additional member(s) and/or
partner(s) of Parent and/or Acquisition.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.16 Joint and Several Obligation of Lima. Each of Lima shall be jointly
and severally liable for the covenants, agreements and obligations of Lima
hereunder.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the Company, Lima, Parent and Acquisition have
executed this Agreement, intending to be legally bound by it, on the day shown
on the first page of this Agreement.
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="65%">
<TR valign="bottom">
    <TD width="12%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="59%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="7" valign="top" align="left"><FONT size="2">THE NEWHALL LAND AND FARMING COMPANY</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top" nowrap><FONT size="2">By:</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="5" valign="top" align="left"><FONT size="2">Newhall Management Limited Partnership,<br>
Managing General Partner</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top" nowrap><FONT size="2">By:</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="3" valign="top" align="left"><FONT size="2">Newhall Management Corporation,<br>
Managing General Partner</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top" nowrap><FONT size="2">By:</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">/s/&nbsp;Gary M. Cusumano</FONT></TD>
</TR>
<TR>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">Name: Gary M. Cusumano</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">Title: President and Chief Executive
Officer</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top" nowrap><FONT size="2">By:</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">/s/&nbsp;Donald L. Kimball</FONT></TD>
</TR>
<TR>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">Name: Donald L. Kimball</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">Title: Vice President and Chief Financial
Officer</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">- 42 -</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="50%">
<TR valign="bottom">
    <TD width="33%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="42%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="5" valign="top" align="left"><FONT size="2">LENNAR CORPORATION</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
By:</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">/s/ Jonathan M. Jaffe</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top" colspan="2"><HR size="1" noshade></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>

<TD align="left" valign="top"><FONT size="2">Name:</FONT></TD>
    <TD><FONT size="2">&nbsp;Jonathan M. Jaffe</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD></TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2"><HR size="1" noshade></FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>


<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">Title:</FONT></TD>
    <TD><FONT size="2">&nbsp;Vice President</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2"><HR size="1" noshade></FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="5" valign="top" align="left"><FONT size="2">LNR
PROPERTY CORPORATION</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
By:</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">/s/ Shelly L. Rubin</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top" colspan="2"><HR size="1" noshade></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>

<TD align="left" valign="top"><FONT size="2">Name:</FONT></TD>
    <TD><FONT size="2">&nbsp;Shelly L. Rubin</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD></TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2"><HR size="1" noshade></FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>


<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">Title:</FONT></TD>
    <TD><FONT size="2">&nbsp;Vice President</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2"><HR size="1" noshade></FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="5" valign="top" align="left"><FONT size="2">NWHL
INVESTMENT LLC</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
By:</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">/s/ Jonathan M. Jaffe</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top" colspan="2"><HR size="1" noshade></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>

<TD align="left" valign="top"><FONT size="2">Name:</FONT></TD>
    <TD><FONT size="2">&nbsp;Jonathan M. Jaffe</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD></TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2"><HR size="1" noshade></FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>


<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">Title:</FONT></TD>
    <TD><FONT size="2">&nbsp;Vice President</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2"><HR size="1" noshade></FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
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    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="5" valign="top" align="left"><FONT size="2">NWHL
ACQUISITION, L.P.</FONT></TD>
</TR>

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    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
By:</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="3" valign="top" align="left"><FONT size="2">NWHL GP LLC,<BR>
General Partner</FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

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    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
By:</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">/s/ Jonathan M. Jaffe</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top" colspan="2"><HR size="1" noshade></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>

<TD align="left" valign="top"><FONT size="2">Name:</FONT></TD>
    <TD><FONT size="2">&nbsp;Jonathan M. Jaffe</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD></TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2"><HR size="1" noshade></FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>


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    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">Title:</FONT></TD>
    <TD><FONT size="2">&nbsp;Vice President</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2"><HR size="1" noshade></FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">- 43 -</FONT>
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="right"><FONT size="2">Exhibit&nbsp;A</FONT>

<P align="center"><FONT size="2">Voting Agreement
</FONT>

<P align="center"><FONT size="2">&nbsp;</FONT>
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>



<P align="right"><FONT size="2">Exhibit&nbsp;B</FONT>

<P align="center"><FONT size="2">Escrow Agreement
</FONT>


<P align="center"><FONT size="2">&nbsp;</FONT>



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<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>4
<FILENAME>y93462exv99w1.htm
<DESCRIPTION>PRESS RELEASE
<TEXT>
<HTML>
<HEAD>
<TITLE>PRESS RELEASE</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="right"><FONT size="2"><B>Exhibit&nbsp;99.1</B></FONT>
<P>
<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0">

<TR>
    <TD width="20%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="20%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="60%"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR>
    <TD align="left" valign="top">
    <FONT size="2"><B>Contacts:</B>
    </FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="bottom">
    <FONT size="2">&nbsp;
    </FONT></TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <FONT size="2">Marshall Ames
    </FONT></TD>
    <TD align="left" valign="bottom">
    <FONT size="2">Shelly Rubin
    </FONT></TD>
<TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <FONT size="2">Investor Relations
    </FONT></TD>
        <TD align="left" valign="bottom">
    <FONT size="2">Chief Financial Officer
    </FONT></TD>
<TD><FONT size="2">&nbsp;</FONT></TD>
    </TR>

<TR>
    <TD align="left" valign="top">
    <FONT size="2">Lennar Corporation
    </FONT></TD>
    <TD align="left" valign="bottom">
    <FONT size="2">LNR Property Corporation
    </FONT></TD>
<TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <FONT size="2">(305)&nbsp;485-2092
    </FONT></TD>
    <TD align="left" valign="bottom">
    <FONT size="2">(305)&nbsp;695-5440
    </FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

</TABLE>
</CENTER>

<P align="left">
<B><U>FOR IMMEDIATE RELEASE</U></B>

<P align="center">
<B><U>NEWHALL LAND ACQUISITION COMPLETED</U></B>

<P align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>MIAMI, January&nbsp;27, 2004&nbsp;&#151; Lennar Corporation
(NYSE:&nbsp;LEN and LEN.B),</B> one of the nation&#146;s largest
homebuilders, and LNR Property Corporation (NYSE:&nbsp;LNR), one
of the nation&#146;s leading real estate investment, finance and
management companies, announced today that a company jointly
owned by Lennar and LNR has completed the acquisition of The
Newhall Land and Farming Company. The total purchase
consideration, after giving effect to payment with regard to
employee options, was approximately $1&nbsp;billion.

<P align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Jeffrey Krasnoff, President and Chief Executive Officer of LNR
Property Corporation, and Robert Strudler, Chief Operating
Officer of Lennar Corporation, jointly stated, &#147;On behalf
of the venture, we would like to extend a warm welcome to
Newhall Land&#146;s associates. Newhall Land is an excellent
franchise and a wonderful complement to the operations of the
venture partners.&#148;

<P align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the transaction, the venture, and another
company jointly owned by Lennar and LNR, arranged
$600&nbsp;million of financing, of which $400&nbsp;million was
used in connection with the acquisition of Newhall Land, and the
remainder will be available to finance operations of Newhall
Land and other property ownership and development companies that
are jointly owned by Lennar and LNR.

<P align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Simultaneous with the acquisition, the venture sold
income-producing properties to LNR for approximately $217
million and Lennar agreed to purchase 687&nbsp;homesites, and
obtained options to purchase 623&nbsp;homesites, from the
venture.

<P align="center">
(more)

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Newhall Land is a premier community planner in north Los Angeles
County. Its primary activities are planning the communities of
Valencia and Newhall Ranch, which together form one of the
nation&#146;s most valuable landholdings. They are located on
Newhall Land&#146;s 34,000&nbsp;acres, 30&nbsp;miles north of
downtown Los Angeles.

<P align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Lennar Corporation, founded in 1954, is headquartered in Miami,
Florida and is one of the nation&#146;s leading builders of
quality homes for all generations, building affordable, move-up
and retirement homes. Lennar&#146;s Financial Services Division
provides mortgage financing, title insurance, closing services
and insurance agency services for both buyers of Lennar&#146;s
homes and others.

<P align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
LNR Property Corporation is a market leader in real estate
finance, management, and development, with proven expertise in
adding value to commercial real estate assets, including real
estate properties, loans collateralized by real estate
properties and securities backed by loans on real estate
properties.

<P>
<DIV align="center">
<HR size="2" width="100%" align="center" noshade>
</DIV>

<P align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Some of the statements contained in this press release are
&#147;forward-looking statements&#148; as that term is defined
in the Private Securities Litigation Reform Act of 1995. By
their nature, forward-looking statements involve risks,
uncertainties and other factors that may cause actual results to
differ materially from those which the statements anticipate.
Factors which may affect the companies include, but are not
limited to, changes in general economic conditions, the market
for real estate generally and in areas where the companies have
developments, the availability and cost of land suitable for
development, the cyclical nature of the real estate business,
agreement with buyers on definitive terms, or failure to close
transactions, materials prices, labor costs, interest rates,
consumer confidence, competition, terrorist acts or other acts
of war, environmental factors and government regulations
affecting the companies&#146; operations. See the respective
companies&#146; Annual Reports on Form&nbsp;10-K for their most
recent year-ends for a further discussion of these and other
risks and uncertainties applicable to the companies&#146;
businesses.

<P>
<DIV align="center">
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</DIV>

<P align="center">
#&nbsp;#&nbsp;#
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