Exhibit 10.119
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NON COMPETITION AGREEMENT
FOR
XXXXX XXXX
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NON-COMPETITION AGREEMENT
THIS NON-COMPETITION AGREEMENT (this "Agreement") is entered into as of
December ___, 1997, by and between Xxxxx Xxxx, an individual residing at
______________________________________________________ (the "X. Xxxx"), and
Cali Realty Corporation, a Maryland corporation with offices at 00 Xxxxxxxx
Xxxxx, Xxxxxxxx, Xxx Xxxxxx 00000 ("Cali").
R E C I T A L S
WHEREAS, the MK Contributors and MK Entities (both as defined in the
Contribution and Exchange Agreement between the parties dated September 18,
1997, as amended by that certain First Amendment dated as of December ,
1997 (as amended, the "Contribution and Exchange Agreement")), each with offices
at 000 Xxxx Xxxxxxx Xxxxxx, Xxxxxxxx Xxxx, Xxx Xxxxxx 00000 and the Patriot
Contributors, Patriot Entities (both as defined in the Contribution and Exchange
Agreement) and Patriot American Management and Leasing Corporation, each with
offices at 0000 XXX Xxxxxxx, Xxxxx 0000, Xxxxxx, Xxxxx 00000 (the MK
Contributors, the MK Entities, the Patriot Contributors and the Patriot Entities
shall collectively be referred to as "Xxxx") and Cali Realty, L.P., a Delaware
limited partnership ("CRLP") and Cali have determined that it is in the best
interests of the parties' long term strategic growth to combine their respective
properties and related assets; and
WHEREAS, in order to effectuate this exchange, Xxxx has agreed to
contribute certain properties and partnership, limited liability company and/or
other ownership interests to designees of CRLP and to cause certain key
executives of Xxxx to become part of the management of Cali. Xxxx has also been
granted certain rights with respect to appointing members of the Board of
Directors of Cali (the "Board") which is the sole general partner of CRLP; and
WHEREAS, X. Xxxx participated in the operation of Xxxx, had a substantial
ownership interest, either individually or in the aggregate with other members
of the Xxxx Group (as defined in the Contribution and Exchange Agreement), in
Xxxx and subsequent to the closing of the transactions contemplated by the
Contribution and Exchange Agreement (the "Closing") received, either
individually or in the aggregate with other members of the Xxxx Group, a
significant block of Units (as defined in the Contribution and Exchange
Agreement) in Cali; and
WHEREAS, Cali or its affiliates are the recipients of some or all of the
property and ownership interests, and in connection with the contribution of the
property and ownership interests to Cali or its affiliates, X. Xxxx had access
to Xxxx'x and Cali's business plans, financial data and other confidential
matters; and
WHEREAS, as a condition of (i) the contribution of the property and
ownership interests to Cali or its affiliates and (ii) the receipt of a
significant block of Units, X. Xxxx has agreed to be bound by the
non-competition restrictions provided herein; and
WHEREAS, Cali desires to have X. Xxxx enter into this Agreement in order to
protect Cali from unfair competition, and X. Xxxx desires to enter into this
Agreement based on the significant ownership interest the Xxxx Group is
obtaining in Cali pursuant to the Contribution and Exchange Agreement,
NOW, THEREFORE, in consideration of Ten Dollars ($10.00) and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. NON-COMPETITION. X. Xxxx hereby agrees that:
(a) For the period commencing on the Closing and ending on the later
to occur of:
(i) three (3) years from the Closing, or
(ii) Xxxx'x Significant Interest (as defined in the Contribution
and Exchange Agreement) is no longer retained by the Xxxx Group,
X. Xxxx shall not, directly or indirectly, within the continental United States,
engage in, or own, invest in, manage or control any venture or enterprise
engaged in any development, acquisition or management activities with respect to
office-service, office or flex property without regard to whether or not such
activities compete with Cali; provided, however, that in the event that the X.
Xxxx acquires industrial or other property and subsequently determines that the
most commercially practicable use for such property is flex, the property may be
converted to flex and the prohibitions set forth in this Paragraph 1 shall not
apply to such property.
Nothing herein shall prohibit X. Xxxx from being a passive owner of not
more than (i) five percent (5%) of the outstanding stock of any class of
securities of a corporation or other entity engaged in real estate which is
publicly traded or (ii) twenty (20%) percent of any real estate venture so long
as such investment does not exceed $15,000,000 per venture and so long as, in
either case, X. Xxxx has no active participation in the business of such
venture,
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corporation or other entity. Moreover, the foregoing limitations shall not be
deemed to restrict or otherwise limit X. Xxxx from:
(A) conducting real estate development or management activities
with respect to Eliminated Property (as defined in the Contribution
and Exchange Agreement) and the properties set forth in Schedule
5.1(r) of the Contribution and Exchange Agreement,
(B) acquiring and conducting real estate development, acquisition
or management activities with respect to properties which may be
purchased by the Director pursuant to Section 27 of the Contribution
and Exchange Agreement.
(b) If, at the time of enforcement of this Paragraph 1, a court of
competent jurisdiction shall hold that the duration, scope, area or other
restriction stated herein is unreasonable, the parties hereto agree that without
further action by the parties hereto the maximum duration, scope, area or other
restriction may be substituted by such court for the stated duration, scope,
area or other restriction.
(c) For purposes of this Agreement, Cali shall be deemed to include
any entity which is controlled, directly or indirectly, by Cali and any entity
of which a majority of the economic interest is owned, directly or indirectly,
by Cali.
2. REMEDIES. The parties hereto agree that Cali would suffer irreparable
harm from a breach by X. Xxxx of any of the covenants or agreements contained
herein. Therefore, in the event of the actual or threatened breach by X. Xxxx
of any of the provisions of this Agreement, Cali may, in addition and
supplementary to any other rights and remedies existing in its favor, apply to
any court of law or equity of competent jurisdiction for specific performance
and/or injunctive or other relief in order to enforce or prevent any violation
of the provisions hereof.
3. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns.
4. MODIFICATION OR WAIVER. No amendment, modification, waiver,
termination or cancellation of this Agreement shall be binding or effective for
any purpose unless it is made in writing signed by the party against whom
enforcement of such amendment, modification, waiver, termination or
cancellation is sought. No course of dealing between or among the parties to
this Agreement shall be deemed to affect or to modify, amend or discharge any
provisions or terms of this Agreement. No delay on the part of Cali or X. Xxxx
in
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the exercise of any of their respective rights or remedies shall operate as a
waiver thereof, and no single or partial exercise by Cali or X. Xxxx of any such
right or remedy shall preclude other or further exercise thereof. A waiver of
right or remedy on any one occasion shall not be construed as a bar to or waiver
of any such right or remedy on any other occasion.
5. NOTICES. All notices or other communications required or permitted
hereunder shall be made in writing and shall be deemed to have been duly given
if delivered by hand or delivered by a recognized delivery service or mailed,
postage prepaid, by express, certified or registered mail, return receipt
requested, and addressed to Cali or X. Xxxx, as applicable, at the address set
forth above (or to such other address as shall have been previously or may
subsequently be provided in accordance with this section).
6. GOVERNING LAW. This Agreement will be governed by and construed in
accordance with the laws of the State of New Jersey, without regard to
principles of conflicts of law thereunder.
7. SEVERABILITY. Whenever possible, each provision and term of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision or term of this Agreement shall be held to
be prohibited by or invalid under such applicable law, then, subject to the
provisions of Paragraph 1 (b) above, such provision or term shall be ineffective
only to the extent of such prohibition or invalidity, without invalidating or
affecting in any manner whatsoever the remainder of such provision or term or
the remaining provisions or terms of this Agreement.
8. COUNTERPARTS. This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and both of which when
taken together shall constitute one and the same Agreement.
9. HEADINGS. The headings of the Paragraphs of this Agreement are
inserted for convenience only and shall not be deemed to constitute a part
hereof and shall not affect the construction or interpretation of this
Agreement.
10. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement of
the parties with respect to the subject matter hereof and supersedes all other
prior agreements and undertakings, both written and oral, among the parties with
respect to the subject matter hereof.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first above written.
CALI REALTY CORPORATION
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By:
Title:
XXXXX XXXX
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Name: Xxxxx Xxxx by Xxxxxxxx X. Xxxxx,
as Attorney-in-fact
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