Exhibit 2.2
CROWN PARTNERSHIP DISTRIBUTION AGREEMENT
----------------------------------------
THIS CROWN PARTNERSHIP DISTRIBUTION AGREEMENT (this
"Agreement"), dated as of May 13, 2003, is entered into by and between CROWN
AMERICAN REALTY TRUST, a Maryland real estate investment trust ("Crown"), and
CROWN AMERICAN PROPERTIES, L.P., a Delaware limited partnership ("Crown
Partnership").
RECITALS
--------
A. Contemporaneously with the execution and delivery of this
Agreement, Crown, Crown Partnership, Pennsylvania Real Estate Investment Trust,
a Pennsylvania business trust ("PREIT"), and PREIT Associates, L.P., a Delaware
limited partnership ("PREIT Partnership"), are entering into an Agreement and
Plan of Merger of even date herewith (the "Merger Agreement"), pursuant to
which, among other things, the parties have agreed that Crown will merge with
and into PREIT, subject to satisfaction of the terms and conditions set forth in
the Merger Agreement. Capitalized terms used herein and not defined are used as
defined in the Merger Agreement.
B. As of the Crown Partnership Distribution Closing Date (as
defined below) and after giving effect to the transactions contemplated by the
4th Amendment to CFSA and the 8th Amendment to Crown Partnership Agreement,
Crown will own units of limited partnership in Crown Partnership (the
"Crown-Owned Common Units") and 11% senior preferred units of limited
partnership in Crown Partnership (the "Crown-Owned Preferred Units").
C. Crown currently is the sole general partner of Crown
Partnership (such interest, the "Crown-Owned General Partner Interest").
D. Pursuant to the Merger Agreement, the parties thereto have
agreed that, subject to satisfaction of the terms and conditions set forth in
Sections 6.1, 6.2 and 6.3 of the Merger Agreement and the terms and conditions
set forth in this Agreement, one (1) business day prior to the Effective Time of
the Merger, (i) Crown Partnership will (A) distribute to Crown, in complete
liquidation of all of the Crown-Owned Common Units, the Crown-Owned Preferred
Units, the Crown-Owned General Partner Interest and any other interest that
Crown might be considered to have in Crown Partnership, the Crown Proportionate
Interest (as defined below) in the Crown Partnership Assets (as defined below)
and (B) admit a new general partner designated by the other partners of Crown
Partnership, and (ii) Crown will (A) assume the Crown Proportionate Interest in
the Crown Partnership Liabilities (as defined below), and (B) agree to indemnify
Crown Partnership for the Crown Proportionate Interest in the Crown Partnership
Liabilities.
E. The parties desire to set forth the terms of the
transactions described in Recital D above.
NOW, THEREFORE, in consideration of the premises and the
mutual representations, warranties, covenants and agreements contained herein,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto, intending to be legally
bound, hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 Definitions. In addition to terms defined elsewhere herein
or in the Merger Agreement, as used herein, the terms set forth below shall have
the meanings:
"Crown Partnership Agreement" shall mean the Amended and
Restated Agreement of Limited Partnership, dated as of August 17, 1993, of Crown
Partnership, as amended.
"Crown Partnership Assets" shall mean all assets, properties,
goodwill and rights, wherever located, whether real, personal or mixed, tangible
or intangible, of Crown Partnership, including, without limitation, Crown
Partnership's interests in the properties identified on Schedule 2.2(a) included
in the Crown Disclosure Letter delivered pursuant to the Merger Agreement as
being owned directly by Crown Partnership, Crown Partnership's partnership
interests in the Limited Partnerships, Crown Partnership's ownership interests
in the General Partners, Crown Partnership's limited liability company interests
in the Limited Liability Companies, Crown Partnership's general partnership
interest in the Palmer Park Mall Venture, and Crown Partnership's stock in the
TRSs.
"Crown Partnership Distribution Closing" shall mean the
closing of the Crown Partnership Distribution Transactions.
"Crown Partnership Distribution Closing Date" shall mean the
date on which the transactions contemplated by this Agreement are consummated,
which date shall be one (1) business day prior to the Effective Time of the
Merger.
"Crown Partnership Distribution Transactions" shall mean the
transactions contemplated by this Agreement.
"Crown Partnership Liabilities" shall mean all liabilities and
obligations of Crown Partnership, including any liability or obligation of any
kind, character or description, whether known or unknown, absolute or
contingent, accrued or unaccrued, disputed or undisputed, liquidated or
unliquidated, secured or unsecured, joint or several, due or to become due,
vested or unvested, executory, determined, determinable or otherwise, other than
the Excluded Liabilities.
"Crown Proportionate Interest" shall mean the percentage of
the economic value of Crown Partnership held by Crown as of the Crown
Partnership Distribution Closing Date, after giving effect to the 4th Amendment
to CFSA and the 8th Amendment to Crown Partnership Agreement, which percentage
shall equal a fraction (i) the numerator of which is the aggregate market value
(as determined in accordance with the following sentence) of the Crown-Owned
Common Units and Crown-Owned Preferred Units, and (ii) the denominator of which
is the aggregate market value (as determined in accordance with the following
sentence) of all of the outstanding common and preferred units of Crown
Partnership immediately prior to the consummation of the transactions
contemplated hereby. The market value of the common and preferred units of Crown
Partnership shall be determined based upon the average trading price of Crown
common shares and preferred shares, respectively, over the five trading day
period ending on the day immediately prior to the Crown Partnership Distribution
Closing Date, and shall take into account, in the case of the Crown Partnership
common units, the "Partner Adjustment Factor," as defined in the Crown
Partnership Agreement, as amended by the Eighth Amendment thereto.
-2-
"Excluded Liabilities" shall mean (i) liabilities for "Claims"
(as defined in the Indemnification Agreement) that are the subject of the
Indemnification Agreement (whether or not PREIT or PREIT Partnership actually
receives indemnification thereunder) or for which the Indemnification Agreement
requires the Indemnifying Parties (as defined therein) to indemnify PREIT or
PREIT Partnership; (ii) liabilities owed by Crown Partnership to the limited
partners of Crown Partnership in their capacities as such; (iii) liabilities of
Crown Partnership for any breach of or failure of Crown Partnership to perform
any of its obligations pursuant to the Merger Agreement or any other agreements
contemplated thereby; and (iv) liabilities of Crown Partnership which accrue or
arise during the period following the Crown Partnership Distribution Closing
Date and which relate to such period, including for purposes of this clause (iv)
any increased costs of doing business for Crown Partnership from and after the
Crown Partnership Distribution Closing Date, whether or not attributable to the
transactions contemplated by the Merger Agreement and the other agreements
referenced therein.
"General Partners" shall mean the single purpose entities
wholly owned by Crown or Crown Partnership and identified on Schedule 2.2(a)
included in the Crown Disclosure Letter delivered pursuant to the Merger
Agreement as the general partners of the Limited Partnerships.
"Limited Liability Companies" shall mean the limited liability
companies identified on Schedule 2.2(a) included in the Crown Disclosure Letter
delivered pursuant to the Merger Agreement, in which Crown Partnership owns all
the issued and outstanding limited liability company ownership interests.
"Limited Partnerships" shall mean the limited partnerships
identified on Schedule 2.2(a) included in the Crown Disclosure Letter delivered
pursuant to the Merger Agreement, in which Crown Partnership owns a 99.5%
limited partnership interest and a General Partner owns a 0.5% general
partnership interest.
"Palmer Park Mall Venture" shall mean the Palmer Park Mall
Joint Venture identified on Schedule 2.2(a) included in the Crown Disclosure
Letter delivered pursuant to the Merger Agreement, in which, as of the Crown
Partnership Distribution Closing Date, Crown Partnership will own a 49.9%
general partnership interest and PR Palmer Park Limited Partnership, a
Pennsylvania limited partnership and an affiliate of PREIT Partnership, will own
a 50.1% general partnership interest.
"TRSs" shall mean Crown American GC, Inc., a Maryland
corporation, and Crown American Services Corporation, a Pennsylvania
corporation, in which Crown Partnership owns 100% of the issued and outstanding
stock, each of which has elected to be treated as a "taxable REIT subsidiary."
-3-
ARTICLE II
DISTRIBUTION AND ASSUMPTION
2.1. Distribution of Proportionate Share of Crown Partnership
Assets. Subject to the terms and conditions of this Agreement, on the Crown
Partnership Distribution Closing Date, Crown Partnership shall distribute to
Crown the Crown Proportionate Interest in the Crown Partnership Assets, in
complete liquidation of all of the Crown-Owned Common Units, the Crown-Owned
Preferred Units, the Crown-Owned General Partner Interest and any other interest
that Crown might be considered to have in Crown Partnership. Following such
distribution, Crown shall have no continuing interest in Crown Partnership.
2.2. Assumption of Proportionate Share of Crown Partnership
Liabilities. Subject to the terms and conditions of this Agreement, on the Crown
Partnership Distribution Closing Date, Crown shall assume the Crown
Proportionate Interest in the Crown Partnership Liabilities.
2.3. Other Actions to be Taken. Subject to the terms and
conditions of this Agreement, on the Crown Partnership Distribution Closing
Date, Crown and Crown Partnership shall execute the documents, and take the
actions contemplated by, Section 4.2.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.1. Crown Partnership's Representations and Warranties. Crown
Partnership hereby represents and warrants to Crown that, except as disclosed in
the Merger Agreement or the Crown Disclosure Letter:
(a) Organization. Crown Partnership is a Delaware
limited partnership duly existing and in good standing under the laws of the
State of Delaware.
(b) Due Authorization. The execution, delivery and
performance of this Agreement and all other documents and agreements to be
executed by Crown Partnership in connection with the transactions contemplated
by this Agreement have been duly and validly authorized by all necessary action
of Crown Partnership. This Agreement constitutes a valid and binding obligation
of Crown Partnership, enforceable against Crown Partnership in accordance with
its terms.
(c) Survival of Representations and Warranties. All
representations and warranties made in this Agreement by Crown Partnership shall
survive the execution of this Agreement and closing of the transactions
contemplated by this Agreement.
3.2 Crown's Representations and Warranties. Crown hereby
represents and warrants to Crown Partnership that, except as disclosed in the
Merger Agreement or the Crown Disclosure Letter:
-4-
(a) Organization. Crown is a Maryland real estate
investment trust duly existing and in good standing under the laws of the State
of Maryland.
(b) Due Authorization. The execution, delivery and
performance of this Agreement and all other documents and agreements to be
executed by Crown in connection with the transactions contemplated by this
Agreement have been duly and validly authorized by all necessary action of
Crown. This Agreement constitutes a valid and binding obligation of Crown,
enforceable against Crown in accordance with its terms.
(c) Survival of Representations and Warranties. All
representations and warranties made in this Agreement by Crown shall survive the
execution of this Agreement and closing of the transactions contemplated by this
Agreement.
ARTICLE IV
CONDITIONS
4.1. Conditions to Each Party's Obligation to Effect the Crown
Partnership Distribution Transactions. The obligation of each party to effect
the Crown Partnership Distribution Transactions shall be subject to the
fulfillment or waiver by the parties to the Merger Agreement at or prior to the
Crown Partnership Distribution Closing Date of the conditions set forth in
Sections 6.1, 6.2 and 6.3 of the Merger Agreement, which conditions are
incorporated herein, mutatis mutandis, as if fully set forth herein.
4.2. Deliveries at Crown Partnership Distribution Closing. At
the Crown Partnership Distribution Closing, in addition to the other actions
contemplated herein, the following actions shall be taken and deliveries shall
be made:
(a) Crown Partnership shall take all steps as shall
be necessary under the Crown Partnership Agreement or otherwise to remove Crown
as its general partner, to admit a new general partner designated by the other
partners of Crown Partnership and otherwise to reflect that Crown has no
continuing interest of any kind in Crown Partnership following the distribution
described in Section 2.1 hereof.
(b) Crown and Crown Partnership shall enter into such
further documents and instruments, including without limitation deeds,
assignments, bills of sale, and other conveyancing documents as either party may
reasonably request to evidence the Crown Partnership Distribution Transactions
and carry out the intent of this Agreement.
ARTICLE V
TERMINATION, AMENDMENT AND WAIVER
5.1 Termination. This Agreement shall be terminated
automatically and without further action by either of the parties if and at such
time as the Merger Agreement is terminated in accordance with the terms thereof.
5.2. Effect of Termination. In the event of termination of
this Agreement pursuant to Section 5.1, this Agreement shall forthwith become
null and void and have no effect, without any liability or obligation on the
part of Crown or Crown Partnership; provided, however, that nothing contained
herein shall affect the rights and obligations of any party under the Merger
Agreement.
-5-
5.3. Amendment. This Agreement may be amended by the parties
in writing; provided, however, that no amendment, modification or waiver shall
be made without the express written consent of PREIT, which consent shall not be
unreasonably withheld or delayed.
ARTICLE VI
POST-CLOSING COVENANTS AND AGREEMENTS
6.1. Indemnification of Crown Partnership by Crown and Its
Successors.
(a) Indemnification of Crown Partnership by Crown and
Its Successors. From and after the Crown Partnership Distribution Closing Date,
Crown and its successors, including without limitation PREIT from and after the
Effective Time of the Merger and PREIT's successors (collectively, the
"Indemnifying Parties"), shall, indemnify and hold harmless Crown Partnership
and its partners (other than Crown), officers, employees and agents
(collectively, the "Indemnified Parties") against any losses, claims,
liabilities, expenses (including reasonable attorneys' fees and expenses),
judgments, fines and amounts paid in settlement in accordance herewith
(collectively, "Losses") incurred by any Indemnified Party arising, directly or
indirectly, from or in connection with (i) the Crown Partnership Liabilities to
the extent of the Crown Proportionate Interest; (ii) all obligations under the
WARN Act with respect to current or former employees of Crown, Crown Partnership
or CASC, including all Solicited Employees, (iii) any unemployment tax statute
or regulation arising from or related to the termination or resignation of
employment by employees of Crown, Crown Partnership and CASC pursuant to
Sections 5.8(a) or 5.8(b) of the Merger Agreement, excluding, however, any
Losses relating to unfavorable experience ratings resulting from such
terminations or resignations, (iv) all obligations under COBRA with respect to
any employees, including former employees, of Crown, Crown Partnership or CASC,
and (v) any failure by PREIT and/or any PREIT Subsidiary (including without
limitation the entity acting as the Successor Employer) to perform any of its
obligations under Section 5.8 of the Merger Agreement. Notwithstanding the
foregoing, the Indemnifying Parties shall not be liable under this Agreement for
Losses in excess of the Crown Proportionate Interest in such Losses (the "Excess
Losses"), provided, however, that the Indemnified Parties shall be entitled to
seek indemnification for the Excess Losses under the indemnification provisions
of the Crown Partnership Contribution Agreement.
(b) Procedures Relating to Third Party Claims. Any
Indemnified Party proposing to assert the right to be indemnified under this
Distribution Agreement shall, promptly after receipt of notice of commencement
of any action by a third party against such Indemnified Party in respect of
which a claim for indemnification is to be made under this Distribution
Agreement by an Indemnified Party against the Indemnifying Parties (a "Third
Party Claim"), notify the Indemnifying Parties of the commencement of such Third
Party Claim through written notice describing it with reasonable specificity and
enclosing a copy of all papers served; provided, however, that the failure so to
notify the Indemnifying Parties shall not relieve the Indemnifying Parties from
any liability which they may have under this Distribution Agreement (except to
the extent such failure to notify materially prejudices the Indemnifying
Parties' ability to defend such Third Party Claim) or from any liability which
the Indemnifying Parties may otherwise have. If any such Third Party Claim is
brought against any of the Indemnified Parties and such Indemnified Parties
notify the Indemnifying Parties of its commencement in accordance herewith, the
Indemnifying Parties shall be entitled to participate in and, to the extent that
-6-
the Indemnifying Parties elect by delivering written notice to such Indemnified
Parties promptly after receiving notice of the commencement of the action from
the Indemnified Parties, to assume the defense of the action and after notice
from the Indemnifying Parties to the Indemnified Parties of their election to
assume the defense of any Third Party Claim, the Indemnifying Parties will not
be liable to the Indemnified Parties for any legal or other expenses except as
provided below. If the Indemnifying Parties assume the defense, the Indemnifying
Parties shall have the right to settle such action without the consent of the
Indemnified Parties; provided, however, that the Indemnifying Parties shall be
required to obtain such consent if the settlement includes (i) any admission of
wrongdoing on the part of the Indemnified Parties, (ii) any decree or
restriction on the Indemnified Parties or (iii) an obligation of the Indemnified
Parties to pay any money that is not otherwise indemnified by the Indemnifying
Parties; provided further, however, that none of the Indemnifying Parties, in
the defense of any such action shall, except with the consent of the Indemnified
Parties, consent to entry of any judgment or enter into any settlement that (i)
does not include as an unconditional term thereof the giving by the claimant or
plaintiff to such Indemnified Parties of a release from all liability with
respect to such action, or (ii) contains obligations other than with respect to
the payment of money. The Indemnified Parties shall have the right to employ
their own counsel in any such action, but the fees, expenses and other charges
of such counsel shall be at the expense of such Indemnified Parties unless (i)
the employment of counsel by the Indemnified Parties has been authorized in
writing by the Indemnifying Parties, (ii) the Indemnified Parties have
reasonably concluded (based on written advice of counsel to the Indemnified
Parties) that there may be legal defenses available to them that are different
from or in addition to and inconsistent with those available to the Indemnifying
Parties, (iii) a conflict or potential conflict exists (based on written advice
of counsel to the Indemnified Parties) between the Indemnified Parties and the
Indemnifying Parties (in which case the Indemnifying Parties will not have the
right to direct the defense of such action on behalf of the Indemnified Parties)
or (iv) the Indemnifying Parties have not in fact employed counsel to assume the
defense of such action within a reasonable time (not to exceed 10 days) after
receiving notice of the commencement of the action from the Indemnified Parties
in accordance herewith, in each of which cases the reasonable fees,
disbursements and other charges of counsel will be at the expense of the
Indemnifying Parties and shall promptly be paid by each of the Indemnifying
Parties as they become due and payable in advance of the final disposition of
the Third Party Claim to the fullest extent and in the manner permitted by law;
provided, however, that in no event shall any contingent fee arrangement be
considered reasonable. Notwithstanding the foregoing, the Indemnifying Parties
shall not be obligated to advance any expenses or costs prior to receipt of an
undertaking by or on behalf of the Indemnified Parties to repay any expenses
advanced if it shall ultimately be determined that the Indemnified Parties are
not entitled to be indemnified against such expense pursuant to the last
sentence of this Section 6.1(b). It is understood that the Indemnifying Parties
shall not, in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees, disbursements and other charges
of more than one separate counsel admitted to practice in such jurisdiction at
any one time for all such Indemnified Parties unless (a) the employment of more
-7-
than one counsel has been authorized in writing by the Indemnifying Parties,
(b) any of the Indemnified Parties have reasonably concluded (based on written
advice of counsel to the Indemnified Parties) that there may be legal defenses
available to them that are different from or in addition to and inconsistent
with those available to other Indemnified Parties, or (c) a conflict or
potential conflict exists (based on written advice of counsel to the Indemnified
Parties) between any of the Indemnified Parties and the other Indemnified
Parties, in case of each of which the Indemnifying Parties shall be obligated to
pay the reasonable fees and expenses of such additional counsel or counsels on
the same basis as provided in the immediately preceding sentence.
Notwithstanding anything to the contrary set forth in this Agreement, the
Indemnifying Parties (i) shall not be liable for any settlement effected without
their prior written consent and (ii) shall not have any obligation hereunder to
any of the Indemnified Parties to the extent that a court of competent
jurisdiction shall determine in a final and non-appealable order that such
indemnification is prohibited by applicable law. In the event of a final and
non-appealable determination by a court that any payment of expenses is
prohibited by applicable law, the Indemnified Parties shall promptly refund to
the Indemnifying Parties the amount of all such expenses theretofore advanced
pursuant hereto.
(c) Procedures Relating to Inter-Party Claims. In the
event that any Indemnified Party desires to seek indemnification from the
Indemnifying Parties pursuant to Section 6.1 (other than in connection with a
Third Party Claim), Crown Partnership shall, on behalf of such Indemnified
Party, notify the Indemnifying Parties from which such indemnification is
sought, which indemnification notices shall be provided not more frequently than
monthly, specifying the basis of such indemnification claim and providing
reasonable back-up information and documentation therefor. The Indemnified Party
shall thereupon give the Indemnifying Parties reasonable access to the books and
records of the Indemnified Party which evidence or support such claim or the
act, omission or occurrence giving rise to such claim and the right, upon prior
notice during normal business hours, to interview any appropriate personnel of
the Indemnified Party related thereto. Within 30 days of the Indemnifying
Parties' receipt of any notice seeking indemnification under this subsection
(c), the Indemnifying Parties shall either pay the amount of such claim or
notify Crown Partnership in writing of the basis for any objection to such
claim. Any undisputed portion of such a claim shall be paid within such 30 day
period.
(d) Exclusive Remedy; Survival. The indemnification
provided in this Section 6.1 will be exclusive of any other remedies that may be
available to the Indemnified Persons with respect to Losses covered by this
Section 6.1, other than Losses for which equitable relief is sought. This
Section 6.1 and the indemnification provided for hereunder shall survive
indefinitely and shall be binding upon Crown and, after the Effective Time of
the Merger, PREIT and their successors and assigns.
6.2. Tax Matters. Crown and Crown Partnership agree that the
distribution of the Crown Proportionate Interest in the Crown Partnership Assets
to Crown under this Agreement is intended to be a liquidating distribution of
all of Crown's interest in Crown Partnership under Internal Revenue Code
Sections 731 and 732(b), and Crown and Crown Partnership agree to file all tax
returns in conformity therewith and not to take any position with any taxing
authority that is inconsistent therewith.
-8-
ARTICLE VII
GENERAL PROVISIONS
7.1. Notices. All notices, requests, claims, demands and other
communications under this Agreement shall be in writing and shall be delivered
in accordance with Section 8.2 of the Merger Agreement; provided, however, that
after the Effective Time of the Merger, any notice to Crown shall be provided to
PREIT.
7.2. Interpretation. When a reference is made in this
Agreement to a Section, such reference shall be to a Section of this Agreement
unless otherwise indicated. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Whenever the words "include", "includes" or
"including" are used in this Agreement, they shall be deemed to be followed by
the words "without limitation."
7.3. Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original and all of which,
taken together, shall be considered one and the same agreement and shall become
effective when one or more counterparts have been signed by each of the parties
and delivered to the other party.
7.4. Entire Agreement. This Agreement and the Merger
Agreement, to the extent its terms are incorporated herein (a) constitute the
entire agreement and supersede all prior agreements and understandings, both
written and oral between the parties with respect to the subject matter of this
Agreement, and (b) are not intended to confer upon any Person other than the
parties hereto any rights or remedies.
7.5. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA,
REGARDLESS OF THE LAWS THAT MIGHT OTHERWISE GOVERN UNDER APPLICABLE PRINCIPLES
OF CONFLICT OF LAWS THEREOF.
7.6. Assignment. Neither this Agreement nor any of the rights,
interests or obligations under this Agreement shall be assigned or delegated, in
whole or in part, by operation of law or otherwise by any of the parties without
the prior written consent of the other parties, except in connection with the
Merger. Subject to the preceding sentence, this Agreement (including without
limitation this Article VII) will be binding upon, inure to the benefit of, and
be enforceable by, the parties and their respective successors and assigns.
7.7. Enforcement. The parties agree that irreparable damage
may occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the parties shall be entitled to seek an injunction
or injunctions to prevent breaches of this Agreement and seek to enforce
specifically the terms and provisions of this Agreement in any federal court
located in Pennsylvania or in any state court located in Pennsylvania this being
in addition to any other remedy to which they are entitled at law or in equity.
In addition, each of the parties hereto (a) consents to submit itself (without
making such submission exclusive) to the personal jurisdiction of any federal
court located in Pennsylvania or any state court located in Pennsylvania in the
event any dispute arises out of this Agreement or any of the transactions
contemplated by this Agreement and (b) agrees that it will not attempt to deny
or defeat such personal jurisdiction by motion or other request for leave from
any such court.
-9-
7.8. Severability. Any term or provision of this Agreement
which is invalid or unenforceable in any jurisdiction shall, as to that
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining terms
and provisions of this Agreement or affecting the validity or enforceability of
any of the terms or provisions of this Agreement in any other jurisdiction. If
any provision of this Agreement is so broad as to be unenforceable, the
provision shall be interpreted to be only so broad as is enforceable.
7.9. Exculpation. This Agreement shall not impose any personal
liability on any shareholder, partner, trustee, trust manager, officer, employee
or agent of Crown, Crown Partnership, or any Subsidiary of Crown or Crown
Partnership, and all Persons shall look solely to the property of Crown or Crown
Partnership for the payment of any claim hereunder or for the performance of
this Agreement. After the Effective Time of the Merger, Crown Partnership shall
have no obligation or liability to Crown, PREIT or PREIT Partnership except as
provided in this Agreement or in any other agreement entered into as
contemplated by the Merger Agreement, and Crown, PREIT and PREIT Partnership
shall have no obligation or liability to Crown Partnership except as provided in
this Agreement or in any other agreement entered into as contemplated by the
Merger Agreement.
-10-
IN WITNESS WHEREOF, Crown and Crown Partnership have caused
this Agreement to be signed by their respective officers (or general partners)
thereunto duly authorized all as of the date first written above.
CROWN AMERICAN REALTY TRUST
By: Mark E. Pasquerilla
---------------------------------------
Name: Mark E. Pasquerilla
Title: Chief Executive Officer
CROWN AMERICAN PROPERTIES, L.P.
By: Crown American Realty Trust, as general partner
By: Mark E. Pasquerilla
---------------------------------------
Name: Mark E. Pasquerilla
Title: Chief Executive Officer