NONCOMPETITION AGREEMENT
------------------------
THIS NONCOMPETITION AGREEMENT (this "Agreement"), is made and entered into
on this 1st day of November, 1996, by and among XXXXXX X. XXXXXXX, XX., an
individual resident of the State of Tennessee ("Executive"), and the Company (as
herein defined).
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, on the date hereof, the Company is entering into a series of
related transactions pursuant to which it will acquire, and obtain the
contractual right to acquire, substantially all of the real estate and operating
assets of NWI Warehouse Group, L.P. and Xxxxxxx & Company Real Estate, Inc.;
WHEREAS, as a condition to the consummation of the transactions described
above, the parties hereto desire to enter into certain agreements restricting
the activities of Executive in an effort to eliminate potential conflicts of
interest that may arise in the future, to protect the Company's legitimate
business interests, i.e., the value of its business and its good will, and for
other business purposes.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which hereby are
acknowledged, the parties hereto agree as follows:
1. Definitions. Capitalized terms used herein shall have the
-----------
meanings set forth below:
"Affiliate" means (i) any entity directly or indirectly controlling,
controlled by, or under common control with Executive, and (ii) each other
entity in which Executive, directly or indirectly, owns any controlling interest
or of which Executive serves as a general partner.
"Agreement" means this Noncompetition Agreement, including any
amendments hereto made in accordance with Section 9(d) hereof.
"Company" means Weeks Corporation, a Georgia corporation, Weeks
Realty, L.P., a Georgia limited partnership, Weeks Realty Services, Inc., a
Georgia corporation, Weeks Construction Services, Inc, a Georgia corporation,
Weeks GP Holdings, Inc., a Georgia corporation, Weeks LP Holdings, Inc., a
Georgia corporation, and any other entity under the common control of Weeks
Corporation and their respective successors.
"Effective Date" means the date as of which this Agreement is
executed.
"Employment Agreement" shall mean the Employment Agreement, of even
date herewith, between Executive and Weeks Corporation.
"Industrial or Office Property" means any real property on which a
distribution facility, service center and/or office building development has
been constructed or is now or hereafter proposed to constructed (for example,
and not by way of limitation, a property of the type managed by the Company).
"Managerial Responsibilities" means managerial and supervisory
responsibilities and duties of the kind contemplated by the Employment Agreement
or otherwise substantially similar to those that Executive has performed for the
Company at any time during his employment by the Company or, in the event that
Executive's employment by the Company is terminated, within two years
immediately prior thereto.
"Restricted Period" means from the Effective Date until the later of
(a) the third anniversary of the Effective Date or (b) one year following the
end of Executive's employment by the Company, subject to the provisions of
Section 4 hereof.
"Territory" means the standard metropolitan statistical area for
Nashville, Tennessee.
2. Noncompetition. Without the prior written consent of the Company,
--------------
Executive will not, during the Restricted Period, serve as an officer, director,
or partner of, or own any interest in, or engage in any Managerial
Responsibilities for or on behalf of, any corporation, partnership, venture, or
other business entity that engages, directly or indirectly, in the development,
operation, management, leasing, construction, or landscaping of an Industrial or
Office Property within the Territory; provided however, that notwithstanding the
foregoing (i) Executive may acquire an interest in any such entity so long as
the nature of any such interest does not afford Executive, acting alone or in
concert with any other person or persons the power to influence in any material
fashion the decision making processes of the entity in which such interest is
held, (ii) Executive may serve as an employee, director, partner, officer or
stockholder of the Company, and (iii) Executive may serve in the respective
capacity shown on Schedule A hereto for the entities identified on Schedule A,
---------- ----------
and to discharge Executive's fiduciary and contractual duties and obligations
with respect thereto, even though such entities (or one or more entities in
which or over which one or more of the entities shown on Schedule A has an
----------
investment or exercises control) may directly compete with the Company, provided
Executive shall not engage in any activity with respect to any such entity that
would negate or materially limit the benefits to the Company of the
restrictions, prohibitions, and provisions to which Executive otherwise is
subject pursuant hereto.
3. (a) Antipirating of Employees. Executive will not, within the
-------------------------
Territory and during the Restricted Period, employ or seek to employ on his own
behalf or on behalf of any other
-2-
person, firm or corporation that engages, directly or indirectly, in the
development, operation, management, leasing, construction, or landscaping of an
Industrial or Office Property, any person who was employed as an employee by the
Company in an executive, managerial, or supervisory capacity during the term of
Executive's employment by the Company and who has not thereafter ceased to be
employed by the Company for a period of at least one (1) year.
(b) Nonsolicitation of Customers. Executive will not, within the
----------------------------
Territory and during the Restricted Period, solicit or seek to solicit on his
own behalf or on behalf of any other person, firm or corporation that engages,
directly or indirectly, in the development, operation, management, leasing,
construction, or landscaping of an Industrial or Office Property, any customer
of the Company who is a customer of the Company at any time during Executive's
employment by the Company.
(c) Trade Secrets and Confidential Information. Executive hereby
------------------------------------------
agrees that he will hold in a fiduciary capacity for the benefit of the Company,
and shall not directly or indirectly use or disclose, any Trade Secret, as
defined hereinafter, that Executive may have acquired during the term of his
employment by the Company for so long as such information remains a Trade
Secret. The term "Trade Secret" as used in this Agreement shall mean
information, including, but not limited to, technical or nontechnical data, a
formula, a pattern, a compilation, a program, a device, a method, a technique, a
drawing, a process, financial data, financial plans, product plans, or a list of
actual or potential customers or suppliers that:
(i) derives economic value, actual or potential, from not being
generally known to, and not being readily ascertainable by
proper means by, other persons who can obtain economic value
from its disclosure or use; and
(ii) is the subject of reasonable efforts by the Company to maintain
its secrecy.
In addition to the foregoing and not in limitation thereof, Executive
agrees that during the period of his employment by the Company and for a period
of one (1) year thereafter, he will hold in a fiduciary capacity for the benefit
of the Company and shall not directly or indirectly use or disclose, any
Confidential or Proprietary Information, as defined hereinafter, that Executive
may have acquired (whether or not developed or compiled by Executive and whether
or not Executive was authorized to have access to such Information) during the
term of, in the course of, or as a result of his employment by the Company. The
term "Confidential or Proprietary Information" as used in this Agreement means
any secret, confidential, or proprietary information of the Company not
otherwise included in the definition of "Trade Secret" above. The term
"Confidential and Proprietary Information" does not include information that has
become generally available to the public by the act of one who has the right to
disclose such information without violating any right of the Company.
-3-
(d) At the termination of Executive's employment under the Employment
Agreement, Executive shall return to the Company all documentation and other
tangible materials in his possession containing Trade Secrets or Confidential
Information.
4. Adjustments to Restricted Period. If Executive's employment
--------------------------------
under the Employment Agreement is terminated and such termination is a No Cause
Termination or an Employee-Initiated Termination (as defined in the Employment
Agreement), the Restricted Period shall continue until what would have been
(absent such termination) the end of Executive's then current term of employment
under such Employment Agreement; provided, however, that in no event shall such
Restricted Period be less than one year from the date of such termination so
long as Executive is paid his "Base Salary" (as defined in the Employment
Agreement) in effect on the date of such termination during such continuation of
the Restricted Period.
5. Reasonable and Necessary Restrictions. Executive acknowledges
-------------------------------------
that the restrictions, prohibitions and other provisions hereof, including
without limitation the Territory and Restricted Period, are reasonable, fair and
equitable in scope, terms and duration, are necessary to protect the legitimate
business interests of the Company, and are a material inducement to the Company
to enter into the transactions contemplated in the recitals hereto. Executive
covenants that he will not challenge the enforceability of this Agreement nor
will he raise any equitable defense to its enforcement.
6. Restrictions In Addition to Employment Agreements. Executive
-------------------------------------------------
acknowledges that the restrictions, prohibitions and other provisions hereof
shall be in addition to and not in substitution of the restrictions,
prohibitions and other provisions of the Employment Agreement, as such agreement
shall be amended and supplemented from time to time.
7. Specific Performance. Executive acknowledges that the
--------------------
obligations undertaken by him pursuant to this Agreement are unique and that the
Company likely will have no adequate remedy at law if Executive shall fail to
perform any of his obligations hereunder, and Executive therefore confirms that
the Company's right to specific performance of the terms of this Agreement is
essential to protect the rights and interests of the Company. Accordingly, in
addition to any other remedies that the Company may have at law or in equity,
the Company shall have the right to have all obligations, covenants, agreements
and other provisions of this Agreement specifically performed by Executive, and
the Company shall have the right to obtain preliminary and permanent injunctive
relief to secure specific performance and to prevent a breach or contemplated
breach of this Agreement by Executive, and Executive submits to the jurisdiction
of the courts of the State of Tennessee for this purpose.
8. Operations of Affiliates. In addition to and without in any way
------------------------
limiting any of the other provisions of this Agreement, Executive agrees that he
will refrain from authorizing any Affiliate to perform any activities that would
be prohibited by the terms of this Agreement if they were performed by
Executive. Notwithstanding anything to the contrary contained in this Section 8
(or in any other section of this Agreement), Executive shall not be required by
the terms of this
-4-
Agreement to violate any fiduciary or contractual duty he owes as a director or
officer of a corporation, as a partner of a partnership, as a trustee of a
trust, or as a controlling person, manager or fiduciary of any other person or
entity.
9. Miscellaneous Provisions.
------------------------
(a) Binding Effect. Subject to any provisions hereof restricting
--------------
assignment, all covenants and agreements in this Agreement by or on behalf of
any of the parties hereto shall bind and inure to the benefit of their
respective successors, assigns, heirs, and personal representatives. None of the
parties hereto may assign any of his or its rights under this Agreement or
attempt to have any other person or entity assume any of his or its obligations
hereunder.
(b) Severability. If fulfillment of any provision of this Agreement,
------------
at the time such fulfillment shall be due, shall transcend the limit of validity
prescribed by law, then the obligation to be fulfilled shall be reduced to the
limit of such validity; and if any clause or provision contained in this
Agreement operates or would operate to invalidate this Agreement, in whole or in
part, then such clause or provision only shall be held ineffective to the extent
of such invalidity, as though not herein contained, and the remainder of this
Agreement shall remain operative and in full force and effect.
(c) Governing Law. This Agreement, the rights and obligations of the
-------------
parties hereto, and any claims or disputes relating thereto shall be governed by
and construed in accordance with the laws of the State of Tennessee, not
including the choice-of-law rules thereof.
(d) Amendment; Waiver. Except as otherwise expressly provided in
-----------------
this Agreement, no amendment, modification or discharge of this Agreement shall
be valid or binding unless set forth in writing and duly executed by each of the
parties hereto. Any waiver by any party or consent by any party to any variation
from any provision of this Agreement shall be valid only if in writing and only
in the specific instance in which it is given, and such waiver or consent shall
not be construed as a waiver of any other provision or as a consent with respect
to any similar instance or circumstance.
(e) Headings. Section and subsection headings contained in this
--------
Agreement are inserted for convenience of reference only, shall not be deemed to
be a part of this Agreement for any purpose, and shall not in any way define or
affect the meaning, construction or scope of any of the provisions hereof.
(f) Pronouns. All pronouns and any variations thereof shall be
--------
deemed to refer to the masculine, feminine, neuter, singular or plural, as the
identity of the person or entity may require.
-5-
(g) Arbitration. If a dispute arises between the parties, then the
-----------
parties agree that their respective representatives shall meet and consult in
good faith and attempt to settle the dispute, within thirty (30) days of written
notice thereof, as a condition precedent to the initiation of arbitration
proceedings as set forth below.
Any dispute, controversy, or claim arising out of or relating to this
Agreement, the breach, termination or invalidity thereof, or Executive's
noncompetition obligations, including claims of tortious interference or other
tort or statutory claims, and including without limitation any dispute
concerning the scope of this arbitration clause, shall be settled by arbitration
in accordance with the Employment Dispute Arbitration Rules of the American
Arbitrators Association then in effect. The judgment on the award rendered by
the arbitrator may be entered in any court having jurisdiction thereof. The
arbitration under this Agreement shall be held in Nashville, Tennessee, or at
such other place as may be selected by mutual agreement of the parties.
The arbitrator shall be mutually acceptable to the parties, or failing
agreement, selected pursuant to the Employment Dispute Arbitration Rules of the
American Arbitrators Association. The parties intend that the arbitrator shall
be independent and impartial. To this end, the arbitrator shall disclose to the
parties any professional, family, or social relationships, past or present, with
any party or counsel.
Strict rules of evidence shall not apply in any arbitration conducted
pursuant to this Agreement. The parties may offer such evidence as they desire
and the arbitrator shall accept such evidence as the arbitrator deems relevant
to the issues and accord it such weight as the arbitrator deems appropriate.
The arbitrator shall have the discretion to order a prehearing exchange of
information by the parties, including without limitation, production of
requested documents, exchange of summaries of testimony of proposed witnesses,
and examination by deposition of parties. No party shall be allowed, however,
to take more than one deposition of the opposing party and no deposition shall
last longer than six (6) hours. All disputes regarding discovery shall be
decided by the arbitrator.
The arbitrator award shall be in writing and shall specify the factual and
legal bases for the award. In rendering the award, the arbitrator shall
determine the respective rights and obligations of the parties according to the
laws of the State of Tennessee or, if applicable, federal law. The arbitrator
shall have the authority to award any remedy or relief that a federal or state
court within the State of Tennessee could order or grant.
Any provisional remedy that would be available from a court of law shall be
available from the arbitrator to the parties, pending the arbitrator's
determination of the merits of the parties' dispute. This shall include orders
of attachment, temporary restraining orders, injunctions, and appointment of a
receiver. If the arbitrator issues such an order, either party may immediately
apply to a court of competent jurisdiction for enforcement of the order, even
though the arbitrator may not have rendered a final award.
-6-
All fees and expenses of the arbitration, including the fees of the
arbitrator and the expense of each parties' counsel, experts, witnesses and
preparation and presentation of proofs, shall be paid by Company.
Unless legally required to do so, neither party may disclose the existence,
content, or results of any arbitration under this Agreement without the prior
written consent of the other party, nor may the arbitrator disclose any such
information without the consent of both parties. This provision shall apply to
all aspects of the arbitration proceeding, including without limitation,
discovery, testimony, other evidence, briefs, and the award.
It is the specific intent of the parties that this arbitration clause be
governed by the Federal Arbitration Act, 9 U.S.C. Section 1 et. seq. ("FAA");
however, if this cause is unenforceable for any reason under the FAA, then the
parties intend that it be governed by the provisions of Tenn. Code Xxx. Sections
29-5-30 through 29-5-320.
Both Executive and Company represent and warrant they have read the
foregoing Section 9(g), that they have had an opportunity to consult with and
receive advice from legal counsel regarding the foregoing Section 9(g), and that
they hereby forever waive all rights to assert that this Section 9(g) was the
result of duress, coercion, or mistake of law or fact.
_____ _____ (Initial of both parties in each space).
(h) Execution in Counterparts. This Agreement may be executed in two
-------------------------
or more counterparts, none of which need contain the signatures of all parties
hereto and each of which shall be deemed an original.
-7-
IN WITNESS WHEREOF, each of the undersigned has executed this Agreement, or
caused this Agreement to be duly executed on its behalf, as of the date first
set forth above.
WEEKS CORPORATION
By:_______________________________
Title:_________________________
WEEKS REALTY, L.P.
By: Weeks GP Holdings, Inc, its
sole General Partner
By:_______________________________
Title:_________________________
WEEKS REALTY SERVICES, INC.
By:_______________________________
Title:_________________________
-8-
WEEKS CONSTRUCTION SERVICES, INC.
By:_______________________________
Title:_________________________
WEEKS GP HOLDINGS, INC.
By:_______________________________
Title:_________________________
WEEKS LP HOLDINGS, INC.
By:_______________________________
Title:_________________________
__________________________________
XXXXXX X. XXXXXXX, XX.
-9-
SCHEDULE A
----------
Executive may serve as a general partner of NWI X, L.P., the sole
general partner of NWI Warehouse Group, L.P. and in that connection (i) complete
the properties under development, (ii) discharge NWI's obligations under various
contracts with respect to such properties under development and with respect to
the Aspen Grove land, I-440 land, and certain other land, and (iii) sell assets
of NWI and otherwise discharge the duties and responsibilities as a general
partner of NWI X, L.P. in its capacity as the general partner of NWI.
To the extent that Weeks has refused to accept a Development Property
pursuant to any right contained in one the Transaction Documents (as listed on
Exhibit A to the First Amendment to the Second Amended and Restated Agreement of
Limited Partnership of Weeks Realty), then Executive shall be entitled to
operate, develop, market and otherwise conduct business with respect to such
Development Property.
-10-
