SEVERANCE AND CONSULTING AGREEMENT
THIS AGREEMENT dated this 15th day of April, 1998, is between
XXXX CENTERS TRUST, a Maryland real estate investment trust (the "Company"),
XXXX CENTERS LIMITED PARTNERSHIP (the "Partnership") and XXXXXX XXXXXXXXX
("Xxxxxxxxx").
BACKGROUND
Xxxxxxxxx has been employed by the Company and the Partnership
since their inception, most recently as its chief executive officer and as a
director of the Company. There are no employment or severance agreements
currently in existence between the Company, the Partnership and Xxxxxxxxx other
than that certain Non-Competition Agreement between the Company and Xxxxxxxxx
dated as of June 3, 1993 (the "Non-Competition Agreement").
The Company and Xxxxxxxxx have agreed that in connection with
the reorganization of the Company as a result of the transactions (the
"Transactions") contemplated by that certain Contribution and Share Purchase
Agreement dated as of April 15, 1998 among the Company and certain other parties
("Contribution Agreement"), Xxxxxxxxx will resign as chief executive officer
effective as of the closing of the Transactions (the "Effective Date"). In this
regard, the Company has agreed to compensate Xxxxxxxxx in connection with his
resignation, his agreement to modify the terms of the Non-Competition Agreement,
his past assistance in ensuring a smooth transition and his agreement to
continue to assist the Company during the transition period.
NOW, THEREFORE, in consideration of the foregoing and the
mutual premises and covenants set forth herein, and intending to be legally
bound hereby, the Company, the Partnership and Xxxxxxxxx agree as follows:
1. Consulting and Real Estate Brokerage Services.
For a period of three (3) years from the Effective Date,
Xxxxxxxxx, upon request by the Company, shall provide the following services:
a. Consulting Services. Xxxxxxxxx shall provide consulting
services to the Company and its management on matters relating to, among other
matters, (i) assistance in implementing the terms of the Transaction; (ii)
facilitating the smooth transition in management; and (iii) other matters
regarding the future operations of the Company.
Xxxxxxxxx shall perform such consulting services as called
for hereunder at such time or times and to such extent as he shall reasonably
determine is reasonably necessary to perform the services requested by the
Company pursuant to this Agreement. The services shall be of a nature consistent
with those performed by the chief executive officer and shall be performed in
such manner and place, including his office, as he reasonably determines to be
necessary or advisable.
b. Brokerage Services. Xxxxxxxxx shall provide non-exclusive
real estate brokerage services in connection with the sale of the Contributed
Properties (defined below) set forth on Schedule X.
Xxxxxxxxx shall perform such real estate brokerage services
as called for hereunder at such time or times and to such extent as he shall
reasonably determine is reasonably necessary to perform the services requested
by the Company pursuant to this Agreement. Notwithstanding the foregoing, it is
understood that the Company shall have the right to determine whether or not to
enter into, to proceed with or consummate the conveyance of a property.
2. Compensation.
1. In consideration for his resignation as an officer of
the Company and the services previously provided to the Company, the Company
shall pay to Xxxxxxxxx on the Effective Date cash in the sum of Six Hundred
Thousand Dollars ($600,000).
2. In consideration of the sum of (i) Two Hundred Thousand
Dollars ($200,000) for agreeing to enter into the Restated Non-Competition
Agreement (defined below) and (ii) One Hundred Thousand Dollars ($100,000) for
providing the consulting services to be provided hereunder, the Company shall
pay to Xxxxxxxxx cash in the aggregate sum of Three Hundred Thousand Dollars
($300,000) payable as follows: $100,000 on the Effective Date; $100,000 on the
first anniversary of the Effective Date and $100,000 on the second anniversary
of the Effective Date.
3. In consideration for the real estate brokerage services
to be provided hereunder, the Company shall pay to Xxxxxxxxx 2.0% of the gross
sale price of each property on Schedule B up to a maximum aggregate commission
of Six Hundred Thousand Dollars ($600,000) (the "Maximum Commission"). Xxxxxxxxx
shall be entitled to such commission whether or not he is the broker of record
with respect to the sale of such properties. Such commission or any part thereof
shall not be considered earned and shall not be due and payable unless and until
the full purchase price as agreed upon is paid to the Company and title actually
passes to the buyer, all in accordance with any contract of sale entered into
between the Company and the buyer. Xxxxxxxxx agrees that the proceeds of the
sale of each such property shall be the sole source of payment of the
commission. Xxxxxxxxx agrees that he shall be responsible for all out-of-pocket
and overhead costs (other than as set forth in Section 5 hereof) incurred in
connection with the real estate brokerage services provided by him pursuant to
this Agreement, it being acknowledged and agreed that the Maximum Commission
shall be the exclusive fee earned by Xxxxxxxxx for his real estate brokerage
services provided hereunder.
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3. Health Benefits.
The Company shall continue the payment of all premiums on
health insurance coverage for Xxxxxxxxx and his wife under the Company's group
medical plan, as the same may be with respect to all executive employees amended
from time to time, for a period of five (5) years from the Effective Date.
4. Share Options.
1. As of the Effective Date, the Company shall grant to
Xxxxxxxxx options to purchase 300,000 of its common shares of beneficial
interest ("Common Shares") at a price of $9.00 per Common Share which shall vest
as follows: 100,000 options on the Effective Date; 100,000 options on the first
anniversary of the Effective Date and 100,000 options on the second anniversary
of the Effective Date. The options shall expire ten (10) years from the
Effective Date. The terms of the options shall otherwise be subject to the
Company's 1994 Share Option Plan, as it may be amended from time to time. Such
options and the underlying Common Shares shall be subject to such restrictions
against transfer and with such registration rights as shall apply on the date of
exercise to the most senior of the Company's officers.
2. As of the Effective Date, all existing options for
Common Shares held by Xxxxxxxxx (i.e. options to purchase 200,000 Common Shares
at $12.00 per Common Share) shall be canceled.
5. Support Services and Expenses.
The Company shall, at its sole cost and expense, continue
to provide Xxxxxxxxx with the use of his and his bookkeeper's current office
space at its offices in Kingston, Pennsylvania for use by himself and his
bookkeeper. In the event the Company relocates its offices from the Kingston
building in which Xxxxxxxxx'x offices are located, the Company no longer shall
have any obligation to provide office space to Xxxxxxxxx or his bookkeeper.
6. Maintenance of Auto Lease Payments.
For the period from the Effective Date through and
including October 1, 1999, the Company shall continue to make the scheduled
monthly lease payments pursuant to the automobile lease, dated as of November 1,
1995, by and between Xxxxxxxxx, as the lessee, and Xxxxxx Motors, as the lessor.
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7. Independent Contractor and Indemnification.
In the performance of this Agreement, it is mutually
understood and agreed that Xxxxxxxxx is at all times acting and performing as an
independent contractor, and not an employee of the Company, and nothing
contained herein shall be construed as appointing Xxxxxxxxx as agent of the
Company, or authorizing him to represent the Company in any matter. Except as
otherwise set forth herein, the Company shall neither have nor exercise any
control or direction over the specific methods by which Xxxxxxxxx shall perform
services hereunder. Xxxxxxxxx understands and agrees that the Company will not
withhold from payments provided hereunder any funds for income tax, unemployment
insurance, social security or any other withholding pursuant to any law or
requirement of any governmental body and all of such payments that may be
required by law are the sole responsibility of Xxxxxxxxx.
Further, Xxxxxxxxx shall indemnify the Company for the
amount (including any penalties and legal fees relating thereto) which the
Company may be required to pay as a result of a determination that Xxxxxxxxx is
an employee to the extent that the Company would have had to withhold funds from
payments made by the Company hereunder if Xxxxxxxxx had been employed by the
Company from the Effective Date.
8. Services for Others.
Nothing in this Agreement shall preclude Xxxxxxxxx from
engaging in any activity, including such as may now or hereafter be engaged in
by Company, except as expressly provided by the amended and restated
Non-Competition Agreement set forth on Exhibit A, which Xxxxxxxxx shall execute
and deliver to the Company on the Effective Date (the "Restated Non-Competition
Agreement")
9. Mutual Releases.
For and in consideration of the transactions contemplated in
this Agreement and the execution of the Restated Non-Competition Agreement, the
receipt and sufficiency of which is hereby acknowledged, the parties hereby
grant the following mutual releases:
1. Company/Partnership Release
The Company and the Partnership (collectively, the "Company
Releasors") hereby release and forever discharge Xxxxxxxxx, his agents,
servants, employees, heirs and assigns, and all other persons, firms and
corporations with whom and which he is, was, or in the future may be, related or
affiliated, both directly and indirectly (collectively, the "Xxxxxxxxx
Releasees"), from any and all claims, demands, actions and causes of action, and
all liability whatsoever (collectively "Losses,") on account of or in any manner
arising or to arise out of actions or inactions by the Xxxxxxxxx Releasees at
any time before the date hereof, whether released or indemnified against under
this Agreement, the by-laws of the Company, the Partnership's Limited
Partnership Agreement or the Contribution Agreement; excluding, however, (i) the
enforceability of the covenants, representations and warranties under the terms
of this Agreement; (ii) the enforceability of the Restated Non-Competition
Agreement; (iii) the willful misconduct or gross negligence of the Xxxxxxxxx
Releasees, which is injurious to the Company and/or the Partnership; (iv) the
Xxxxxxxxx Releasees conviction of, or plea of guilty to, a felony; (v) actions
which are ultra xxxxx or otherwise outside the scope of Xxxxxxxxx'x authority as
chief executive officer and/or director of the Company; and (vi) acts of
dishonesty or fraud by the Xxxxxxxxx Releasees with respect to the Company
and/or the Partnership; provided, however, that the foregoing exclusions (i)
through (vi) shall not apply to those activities, transactions and matters by,
between and among the Company Releasors and the Xxxxxxxxx Releasees
("Activities") which prior to the Effective Date have been disclosed by the
Xxxxxxxxx Releasees to the Company Releasors other than new facts with respect
to such Activities which were not disclosed to the Company Releasors prior to
the date hereof.
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The execution of this instrument by the Company Releasors
releases the Xxxxxxxxx Releasees of and from all Losses, known or unknown at the
time of the execution of this instrument, which have resulted or may hereafter
result, or which may hereafter be discovered, and which relate in any way to the
subject matter of this Section 9.a.
2. Xxxxxxxxx Release
Xxxxxxxxx, his agents, servants, employees, heirs and
assigns, and all other persons, firms and corporations with whom and which he
is, was, or in the future may be, related or affiliated, both directly and
indirectly (collectively the "Xxxxxxxxx Releasors"), hereby release and forever
discharge the Company, the Partnership, their respective officers, directors,
trustees and employees and other persons, firms and corporations with whom and
which they are, were, or in the future may be, related or affiliated, both
directly and indirectly (collectively, the "Company Releasees") from any and all
Losses on account of or in any manner arising or to arise out of actions or
inactions by the Company Releasees at any time before the date hereof, whether
indemnified against under the Contribution Agreement or this Agreement;
excluding, however, (i) the enforceability of the covenants, representations and
warranties made by the Company Releasees under the terms of this Agreement or
the Contribution Agreement, and (ii) the indemnification provisions contained in
this Agreement, the by-laws of the Company and the Limited Partnership Agreement
of the Partnership.
The execution of this instrument by the Xxxxxxxxx Releasees
releases the Company Releasees of and from all Losses, known or unknown at the
time of the execution of this instrument, which have resulted or may hereafter
result, or which may hereafter be discovered, and which relate in any way to the
subject matter of this Section 9.b.
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10. Indemnification.
1. (i) Those provisions of the by-laws of the Company and
of the Agreement of Limited Partnership of the Partnership with respect to
indemnification, advancement of expenses and limitation on liability for the
benefit of the trustees, officers, employees and consultants set forth therein,
shall not be amended, repealed, or otherwise modified for a period of six (6)
years after the Effective Date in any manner that would adversely affect the
rights thereunder of individuals who at any time prior to the Effective Date
were trustees or officers of the Company in respect of actions or omissions
occurring at or prior to the Effective Date (including, without limitation, the
transactions contemplated by this Agreement), unless such modification is
required by law.
(ii) From and after the Effective Time, the Company and
the Partnership shall indemnify, defend and hold harmless Xxxxxxxxx to the same
extent as any other present and former officers and trustees of the Company
(collectively with Xxxxxxxxx, the "Indemnified Parties") against all losses,
expenses, claims, damages or liabilities, or amounts that are paid in settlement
of, or otherwise in connection with, any claim, action, suit, proceeding or
investigation (a "Claim"), based in whole or in part on the fact that such
person is or was a trustee, officer, employee or agent of the Company or any
Subsidiary thereof (including the Partnership) and arising out of actions or
omissions occurring at or prior to the Effective Date, in each case to the full
extent permitted under Maryland law as it pertains to the Company and under
Delaware law as it pertains to the Partnership (and shall pay in advance of the
final disposition of any action or proceeding to each Indemnified party to the
fullest extent permitted by Maryland law and Delaware law, as the case may be,
upon receipt from the Indemnified Party to whom expenses are advanced of an
undertaking to repay such advances in the event that it shall be finally
judicially determined that indemnification and the payment of such advances is
not permissible under applicable law).
(iii) Without limiting the foregoing, in the event any
Claim is brought against any Indemnified Party (whether arising before or after
the Effective Date) after the Effective Date: (A) the Indemnified Parties may
retain the Company's regularly engaged independent legal counsel, or other
independent legal counsel satisfactory to them provided that such other counsel
shall be reasonably acceptable to the Company; (B) the Company shall pay all
reasonable fees and expenses of such counsel for the Indemnified Parties
promptly as statements therefor are received; and (C) the Company will use their
reasonable best efforts to assist in the vigorous defense of any such matter,
provided that the Company shall not be liable for any settlement of any Claim
effected without its written consent, which consent shall not be unreasonably
withheld. Any Indemnified Party wishing to claim indemnification under this
Section 10.a, upon learning of any such Claim, shall notify the Company
(although the failure so to notify the Company shall not relieve the Company
from any liability which the Company may have under this Section 10.a except to
the extent such failure prejudices the Company, and shall deliver to the Company
and to the Partnership the undertaking contemplated by the Maryland law and the
Delaware law, respectively). The Indemnified Parties as a group may retain one
law firm (in addition to local counsel) to represent them with respect to each
such matter unless there is, under applicable standards of professional conduct
(as reasonably determined by counsel to the Indemnified Parties), a conflict on
any significant issue between the positions of any two or more Indemnified
Parties in which event, such additional counsel as may be required may be
retained by the Indemnified Parties.
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(iv) The Company shall cause to be maintained in effect
for not less than six (6) years after the Effective Date the current policies of
trustees' and officers' liability insurance maintained by the Company with
respect to matters occurring prior to the Effective Date; provided, however,
that the Company may substitute therefor policies of substantially similar
coverage containing substantially similar terms and conditions to the extent
reasonably available and the Company shall not be required to pay an annual
premium for such insurance in excess of 200% of the last annual premium paid
prior to the date of this Agreement, but in such case shall purchase as much
coverage as possible for such amount.
(v) This Section 10.a is intended to be for the benefit
of, and shall be enforceable by, the Indemnified Parties, their heirs and
personal representatives, shall be binding on the Company and its and their
respective successors and assigns, and shall not be amended or modified to
adversely affect any such party without the prior written consent of such party.
2. Supplementing and in addition to Xxxxxxxxx'x right to
indemnification for Losses under and pursuant to the indemnification provisions
contained in Section 10.a hereof or the Company's by-laws and the Partnership's
Limited Partnership Agreement, the Company and the Partnership agree that (i)
with respect to Losses for which Xxxxxxxxx is entitled to indemnification they
will not settle or otherwise resolve any Claim asserted or imposed against them,
or either of them, and Xxxxxxxxx, jointly or severally, without simultaneously
settling or otherwise resolving the Claim asserted or imposed against Xxxxxxxxx;
and (ii) such indemnification provisions shall apply to any Activities which
prior to the Effective Date have been disclosed by the Xxxxxxxxx Releasees to
the Company Releasors, provided Xxxxxxxxx'x Losses are not related to new facts
with respect to such Activities which were not disclosed to the Company
Releasors prior to the date hereof.
11. Voting Arrangements; Consents. Xxxxxxxxx hereby agrees (a)
as a shareholder of the Company, to vote any Common Shares which he directly or
indirectly owns or controls in favor of the Transactions; (b) as a limited
partner of the Partnership, (i) to execute any amendment to the Partnership's
Agreement of Limited Partnership required pursuant to the Contribution Agreement
(the "Amendment") and (ii) that by execution of this Agreement Xxxxxxxxx hereby
consents to the Amendment.
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12. Agreements Respecting Properties Previously Owned by
Xxxxxxxxx.
1. Guaranty or Indemnity. Xxxxxxxxx has previously
contributed to the Partnership the properties set forth on Schedule A (the
"Contributed Properties"). At the Effective Date, or at any time subsequent
thereto in accordance with the terms hereof, the Company and the Partnership and
its respective subsidiaries will permit the Xxxxxxxxx to guarantee, or indemnify
the Company, the Partnership and their respective subsidiaries for, the "bottom"
portion (i.e., the least risky portion) of indebtedness of the Partnership. In
the event that other partners of the Partnership or any subsidiary (including
future contributors) similarly require a guarantee or indemnity of indebtedness
of the Company, the Partnership and/or their respective subsidiaries, and such
guarantee of indemnity of indebtedness is the "bottom" portion of the
indebtedness of the Partnership, then all such partners (including Xxxxxxxxx)
shall share pari passu in the "bottom" portion of such indebtedness.
Notwithstanding the previous sentence, the Company and the Partnership agree to
maintain (or make available for the benefit of Xxxxxxxxx) (i) during the
Restricted Period (as defined below) an amount of indebtedness equal to
$55,000,000, and (ii) after the Restricted Period any debt encumbering the
Contributed Properties, solely for Xxxxxxxxx to guarantee (or indemnify the
Company, the Partnership or their respective subsidiaries for such
indebtedness). In the event that during the Restricted Period Xxxxxxxxx
guarantees or indemnifies the Company, the Partnership, or their respective
subsidiaries with respect to indebtedness encumbering any property of the
Company, the Partnership or any subsidiary, such indebtedness shall not exceed
sixty (60%) percent of the fair market value of such property, as determined by
a majority of the disinterested trustees of the Company. The Company and the
Partnership agree, and shall cause their respective subsidiaries to agree, to
take any and all action reasonably designed so that the execution of each
guarantee or indemnity by Xxxxxxxxx results in tax basis for Xxxxxxxxx for
federal income tax purposes.
2. No Property Disposition. Except as set forth in Section
12.d, the Company and the Partnership covenant that they shall not sell,
transfer, distribute or otherwise dispose, nor permit any of their respective
subsidiaries to sell, transfer, distribute or otherwise dispose, of the
Contributed Properties (including, but not limited to, the stock of any
corporations) (or the properties, if any, that are substituted or exchanged for
the Contributed Properties), prior to the fifth anniversary of the Effective
Date (the "Restricted Period") other than an exchange or other disposition which
does not cause Xxxxxxxxx to recognize gain for federal income tax purposes
(including, without limitation, a transaction pursuant to Section 1031 of the
Code or any successor provision which would not cause such recognition of gain).
Before the end of the Restricted Period, the Company, the Partnership or any of
their respective subsidiaries shall have the right to dispose of or distribute
any of the Contributed Properties in a taxable transaction provided the Company,
the Partnership and/or such subsidiary pays to Xxxxxxxxx the Tax Payment (as
defined below). Nothing contained in this Section 12.b shall be deemed to be
construed to limit the rights of any lender or other secured party to foreclose
on, or otherwise dispose of, the Contributed Properties, or, of the Partnership
to dispose of the Contributed Properties; provided, however, the Company, the
Partnership and/or such subsidiary shall pay to Xxxxxxxxx the Tax Payment, if
any, triggered by any taxable disposition of the Contributed Properties (other
than as a result of a foreclosure) prior to the expiration of the Restricted
Period. The term "Tax Payment" as used herein means an amount equal to the sum
of (i) the federal, state, and local income Taxes actually payable by Xxxxxxxxx
resulting from the recognition of gain and (ii) an additional payment in an
amount equal to the amount such that, after payment by Xxxxxxxxx of all Taxes
(including interest and penalties) on amounts received under clause (i) and this
clause (ii), Xxxxxxxxx retains an amount equal to the amount described in clause
(i).
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3. Right of Redemption.
1. Except as set forth in Section 12.d, in the event that
after the end of the Restricted Period and prior to the second (2nd) anniversary
of the termination of the Restricted Period, the Company, the Partnership or any
of their respective subsidiaries desires to sell or otherwise desire to dispose
of (through foreclosure or otherwise), or receive an unsolicited offer to
purchase any Contributed Property after the Restricted Period, which offer the
Company, the Partnership or such subsidiary wishes to accept, and provided that
Xxxxxxxxx has given notice to the Company in December of the calendar year
immediately preceding the calendar year in which occurs such proposed sale or
disposition to the effect that Xxxxxxxxx desires to receive any Offering Notice
(as described below) required to be sent during the next calendar year; the
Company, the Partnership or such subsidiary shall give notice (the "Offering
Notice") thereof to Xxxxxxxxx. The Offering Notice shall specify the nature of
the sale and the consideration and other terms upon which it intends to
undertake such sale, and shall specify that the failure of Xxxxxxxxx to respond
within the time period set forth below shall be deemed an election by Xxxxxxxxx
not to purchase the Contributed Property. Within thirty (30) days from the date
of the Offering Notice, Xxxxxxxxx may elect, by written notice to the Company,
to purchase the Contributed Property. If Xxxxxxxxx elects to so purchase the
Contributed Property as aforesaid, then such purchase shall be consummated on
the terms and conditions set forth in the Offering Notice; provided, however, to
the extent that the Contributed Property is then subject to separately allocated
debt and the lender thereof consents to Xxxxxxxxx assuming such debt at no cost,
expense or liability to the Company, the Partnership or any subsidiary, the
Company shall cause the Contributed Property to be conveyed to Xxxxxxxxx subject
to such debt.
2. Xxxxxxxxx may use units of limited partnership in the
Partnership ("OP Units") as currency, in whole or in part, in connection with
the purchase of the Contributed Property from the Company, Partnership or any
subsidiary pursuant to an election made in accordance with Section 12.c.i. In
addition, as part of a transfer of the Contributed Property pursuant to a
foreclosure proceeding with respect to any debt secured by the Contributed
Property, if Xxxxxxxxx can cause the third party which is otherwise to obtain
title to the Property to accept OP Units in whole or in part, in lieu of
obtaining title to the Contributed Property (and without modifying any other
terms in the agreement of sale or transfer which has been executed in respect of
such Contributed Property), Xxxxxxxxx shall have the right to do so provided
that such third party agrees in writing for the benefit of the Partnership to be
bound by all of the terms and conditions of the Agreement of Limited Partnership
of the Partnership and, in accordance therewith, compliance with all
requirements pertaining to a transfer of OP Units (other than the need to obtain
the consent of the general partner of the Partnership, which consent is deemed
to be given pursuant to the terms of this Section 12.c; in such event, title to
the Property shall be transferred to Xxxxxxxxx in redemption of the OP Units
described above.
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3. If within the thirty (30) day period during which
Xxxxxxxxx has the right to elect to purchase the Contributed Property under the
Offering Notice, Xxxxxxxxx does not make the election or fails to respond to the
Offering Notice, the Company, the Partnership or their subsidiary may undertake
to sell the Contributed Property on such terms and conditions as it shall elect;
provided, however, that the sale of the Contributed Property to which the
Offering Notice pertains shall not be consummated at less than ninety percent
(90%) of the price as specified in the Offering Notice unless the Company, the
Partnership or the subsidiary again offers the Contributed Property to Xxxxxxxxx
upon such more favorable terms and conditions. If Xxxxxxxxx notifies the Company
of his intention not to purchase the Contributed Property as set forth in the
revised Offering Notice, or if Xxxxxxxxx does not respond to the revised
Offering Notice within the prescribed thirty (30) day period, then the Company,
the Partnership or the subsidiary may consummate the sale at any time
thereafter. In such event, Xxxxxxxxx shall have no further right of redemption
as against the party to whom the Company, the Partnership or the subsidiary
transferred title to the Contributed Property; provided, however, that
Xxxxxxxxx'x right of redemption hereunder shall apply to any real property
received by the Company, the Partnership or a subsidiary and in an exchange for
the Contributed Property, whether said property represents all or only a part of
the consideration for the transfer of the Contributed Property.
4. In the event that Xxxxxxxxx elects to purchase the
Contributed Property pursuant to this Section 12.c, the Company agrees to
cooperate with Xxxxxxxxx at no cost, expense or liability to the Company to
cause debt to be placed on the Contributed Property immediately prior to the
closing of the conveyance of the Contributed Property; provided that: (1)
Xxxxxxxxx arranges for such debt at his sole cost and expense; (2) Xxxxxxxxx is
unconditionally and irrevocably prepared to close such conveyance immediately
after said closing of the loan; and (3) Xxxxxxxxx agrees to assume the debt and
thereafter assumes the same at the closing and the Company, the Partnership and
all of their respective subsidiaries are released of all liability thereunder
immediately following the closing of the conveyance of the Contributed Property.
5. Notwithstanding anything herein to the contrary, the
provisions of Section 12.b. and c. shall not apply to those properties set forth
on Schedule C, which the Company, the Partnership or their subsidiary may sell
or otherwise transfer without restriction. The provisions of Section 12.a. shall
not apply to any Contributed Properties sold pursuant to this Agreement.
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13. Entire Agreement. This Agreement contains the entire
agreement of the parties with respect to the subject matter hereof and shall not
be modified or changed in any respect except in writing duly signed by the
parties hereto.
14. Term; Termination.
1. This Agreement shall terminate five (5) years after the
Effective Date.
2. This Agreement may be terminated at any time prior to
its expiration as set forth in Section 14(a) hereof (i) by mutual agreement of
the parties hereto, (ii) by Xxxxxxxxx voluntarily upon thirty (30) days written
notice to the Company, or (iii) by the Company for cause upon written notice to
Xxxxxxxxx.
3. The Company shall be entitled, at its discretion, to
terminate this Agreement for cause whenever: (i) Xxxxxxxxx shall be convicted of
a felony involving the Company's business, assets or employees; or (ii) after
written notice specifying the nature and occurrence of the following misconduct
or breach and a period of 30 days within which to corrrect, or if not
correctable, then to cease, the continuation of such breach or misconduct,
Xxxxxxxxx (1) commits a material breach of this Agreement, the Restated
Non-Competition Agreement or any other agreement with the Company; (2)
misappropriates confidential and proprietary information of the Company; (3)
engages in willful misconduct with respect to the Company's business, assets or
employees causing a disruption of the Company's business, or (4) engages in any
other verifiable misconduct adversely affecting the business reputation of the
Company in a material manner.
4. In the event this Agreement is terminated as set forth
in Section 14(b) or 14(c) hereof or Xxxxxxxxx'x death, Xxxxxxxxx shall no longer
be entitled to, and the Company shall cease to provide or make available to
Xxxxxxxxx, the compensation and other benefits set forth in Sections 2.b and c.,
3, 4, and 6 hereof and any unvested options issued pursuant to Section 4 shall
be canceled.
5. The provisions of Sections 7, 8, 9, 10 and 12 shall
survive the expiration or earlier termination of this Agreement.
15. Governing Law.
This Agreement shall be governed by, and interpreted,
construed and enforced in accordance with the laws of the State of Pennsylvania.
16. Captions.
Captions in this Agreement are solely for purposes of
identification and shall not in any manner alter or vary the interpretation or
construction of this Agreement.
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17. Notice Provisions.
Any notices or other communications required or permitted
hereunder shall be sufficient if in writing and delivered by hand or sent by
telecopy, or sent, postage prepaid, by U.S. Post Office express-mail, or by
recognized overnight air courier service and shall be deemed given when so
delivered by hand, or telecopied, or if mailed or sent by overnight courier
service, on the scheduled delivery date, to the parties at the following
addresses:
1. if to the Company, to:
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxx
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
with a copy to:
Battle Xxxxxx LLP
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxxxxxx
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
2. if to Xxxxxxxxx, to:
Xxxxxx Xxxxxxxxx
000 Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxxx 00000
Telephone No.: (000) 000-0000, (000) 000-0000
and (000) 000-0000
Facsimile No.: (000) 000-0000, (000) 000-0000
and (000) 000-0000
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with a copy to:
Rosenn, Xxxxxxx & Xxxxxxxxx, L.L.P.
00 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxx-Xxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxx Xxxx, Esq.
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
or to such other address as the addressee may have specified in a notice duly
given to the sender as provided herein.
18. Successors and Assigns.
All terms and provisions of this Agreement shall be
binding upon and shall inure to the benefit of the parties hereto, the
successors and assigns of the Company, and in the event of the death or
incapacity of Xxxxxxxxx, his heirs or personal representatives. Xxxxxxxxx shall
not assign, sell or transfer this Agreement, his obligations hereunder or any
interest herein.
19. Effectiveness.
This Agreement shall not be effective unless and until the
closing of the Transactions under the Contribution Agreement has occurred.
20. Further Assurances. The parties agree to (a) furnish upon
request to each other such further information, (b) execute and deliver to each
other such other documents, and (c) do such other acts and things, all as the
other party may reasonably request for the purpose of consummating the
Transactions and carrying out the intent of this Agreement and the Contribution
Agreement and the documents referred to in this Agreement and the Contribution
Agreement.
[SIGNATURE PAGE FOLLOWS]
13
IN WITNESS WHEREOF, the parties hereto have executed and
delivered this Agreement on the date first above written.
XXXX CENTERS TRUST
By: /s/ Xxxxxx Xxxx
---------------------------------------
Name:
Title:
XXXX CENTERS LIMITED PARTNERSHIP
By: Xxxx Centers Trust, general partner
By: /s/ Xxxxxx Xxxx
---------------------------------
Name: Xxxxxx Xxxx
Title: Senior Vice President
/s/ Xxxxxx Xxxxxxxxx
------------------------------------------
Xxxxxx Xxxxxxxxx
14
Schedule A
----------
25th Street
Xxxxxxxx
Kingston Plaza
Ledgewood
Manahwakin
Xxxx Plaza
New Xxxxxx
Xxxxxx Plaza
Circle Plaza
Crescent Plaza
Dunmore
East End
Greenridge
Luzerne
Monroe
Mountainville
Northside
Northwood
Plaza 000
Xxxxx 0
Xxxxxxxxxxx
Xxxx Plaza
Union
Wesmark
Normandale
Xxxx Plaza
Plaza 15
New Smyrna
Searstown
Pittston
Berlin
Bradford
Tioga
Valmont
Auburne
Cloud Springs
Kings Fairground
Martintown
Midway
New Castle
Schedule B
----------
Pittston
Berlin
Xxxxxxxx
Xxxxxxx
Towanda
Tioga
Valmont
Cloud Springs
Kings Fairground
Schedule C
----------
Pittston
Berlin
Xxxxxxxx
Xxxxxxx
Towanda
