AMENDED AND RESTATED
NON-COMPETITION AGREEMENT
THIS AMENDED AND RESTATED NON-COMPETITION AGREEMENT (this
"Agreement") is made and entered into as of the 30th day of March, 1998, by
and among Philips International Realty, L.P. (the "Partnership"), Philips
International Realty Corp., a general partner of the Partnership (the
"Corporation" and together with the Partnership, the "Owner"), Philips
International Holding Corp. (the "Managing Company"), Xxxxxx Xxxxxxxx, the
Chairman of the Board of Directors and Chief Executive Officer of the
Corporation and the sole member of the managing general partner of the
Partnership ("Xx. Xxxxxxxx"), and Xxxxxx Xxxxxx, a director and executive
officer of the Corporation ("Xx. Xxxxxx," and together with the Managing
Company and Xx. Xxxxxxxx, the "Managers").
WHEREAS, pursuant to the Amended and Restated Management
Agreement by and between the Managing Company and Owner dated as of the date
hereof (the "Management Agreement"), the Managing Company provides certain
management services to Owner and the properties of Owner (the "Owner's
Properties") and, in such capacity, is engaged in, among other things, the
acquisition, ownership, management, leasing, renovation, development and
redevelopment of commercial real estate in the United States.
WHEREAS, the Managing Company acknowledges that its
engagement by Owner creates a relationship of confidence and trust and it will
obtain confidential information with regard to the business of Owner and its
affiliates and clients;
WHEREAS, the Managing Company acknowledges that, as a result
of its obtaining confidential information as to Owner and its affiliates and
clients, Owner and its affiliates will suffer substantial damage, which would
be difficult to ascertain if the Managing
Company enters into competition with Owner or any affiliate and that it is
necessary for Owner to be protected by the prohibition against competition and
the confidentiality restrictions set forth herein;
WHEREAS, Xx. Xxxxxxxx and Xx. Xxxxxx acknowledge that their
position with the Corporation creates a relationship of confidence and trust
and they will obtain confidential information with regard to the business of
Owner, and its affiliates and clients;
WHEREAS, Xx. Xxxxxxxx and Xx. Xxxxxx acknowledge that, as a
result of their obtaining confidential information as to Owner and its
affiliates and clients, Owner and its affiliates will suffer substantial
damage, which would be difficult to ascertain, if Xx. Xxxxxxxx or Xx. Xxxxxx
enters into competition with Owner or any affiliate;
WHEREAS, the Managers and Owner entered into that certain
Non-Competition Agreement, dated as of December 31, 1997 (the "Original
Agreement"), which provided for Owner to be protected by the prohibition
against competition and the confidentiality restrictions set forth therein;
and
WHEREAS, the Managers and Owner wish to amend and restate
the terms and provisions of the Original Agreement in its entirety, all upon
the terms and provisions, and subject to the conditions, set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants herein set forth, and for other good and valuable
consideration, the Managers and Owner agree as follows:
1. Non-competition.
1(a) Non-competition. Except as expressly provided
herein, each of the Managers agrees that during the period commencing on
December 31, 1997 and until such time
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as (i) one year after such time as the Management Agreement is terminated
and neither Xx. Xxxxxxxx nor Xx. Xxxxxx is a director or executive officer of
the Corporation, and (ii) the date on which neither Xx. Xxxxxxxx nor Xx.
Xxxxxx beneficially owns more than fifteen (15%) percent of the outstanding
shares of common stock of the Corporation on a fully diluted basis (including
Partnership units redeemable for shares of common stock of the Corporation
(the "Non-Competition Period"), neither Xx. Xxxxxxxx, Xx. Xxxxxx, the Managing
Company nor any affiliate of the Managing Company (within the meaning of Rule
12(b)-2 of the Securities Exchange Act of 1934) (an "Affiliate" and together
with Xx. Xxxxxxxx, Xx. Xxxxxx and the Managing Company, the "Managing Group")
shall engage in any way, directly or indirectly, in the acquisition,
ownership, operation, development, management, renovation or leasing of any
retail shopping center properties (or mixed properties which are primarily
known as retail shopping center properties based upon the relative square
footage of each use) or any improvements thereof located in the United States,
except for (i) the Managing Company in its capacity as a manager of the
Owner's Properties, (ii) Xx. Xxxxxxxx or Xx. Xxxxxx in his or her capacity as
a director, officer or employee of the Managing Company but solely in the
Managing Company's capacity as manager of the Owner's Properties, or (iii) Xx.
Xxxxxxxx or Xx. Xxxxxx in his or her capacity as an employee, director,
trustee, officer or equity owner of the Corporation; provided, however, that
this Section 1(a) shall not apply to (i) the activities of the Managing Group
with respect to any property listed in Exhibit A (the "Excluded Properties")
attached hereto; (ii) the expansion of the Excluded Properties which expansion
is contiguous to such property and (a) will not increase the existing gross
leaseable area of the property by more than 20%; or (b) is the result of the
exercise of the fiduciary duty of Xx. Xxxxxxxx or Xx. Xxxxxx after discussion
with their partners or members, as the case may be; and (iii) the acquisition,
operation,
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development, management or leasing of any retail shopping center property
located anywhere in the Continental United States by the Managing Group
provided that the retail shopping center portion of such property shall not
exceed ten thousand (10,000) square feet. In the event five (5) years from the
date hereof Xx. Xxxxxx has ceased being a director and an executive officer of
the Corporation for at least one year and beneficially owns less than five
(5%) percent of the outstanding shares of common stock of the Corporation on a
fully diluted basis (including Partnership units redeemable for shares of
common stock of the Corporation), then notwithstanding anything to the
contrary herein, with respect to Xx. Xxxxxx only, this Agreement shall be
deemed terminated and of no further force or effect.
Nothing contained in this Agreement shall in any
way be construed as a restriction or limitation, now or in the future, on the
ability of Xx. Xxxxxxxx'x father, Xxxx Xxxxxxxx, or brother, Xxxxx Xxxxxxxx,
to own, develop, operate or manage retail shopping centers.
1(b) Reasonable and Necessary Restrictions. Each of
the Managers acknowledges that the restrictions, prohibitions and other
provisions of this Section 1 are reasonable, fair and equitable in scope,
terms and duration, are necessary to protect the legitimate business interests
of Owner, and are a material inducement to Owner's engagement of the Managing
Company and the Corporation's retention of Xx. Xxxxxxxx and Xx. Xxxxxx.
1(c) Non-Solicitation. Each of the Managers agrees
that during the Non-Competition Period, none of the members of the Managing
Group will directly or indirectly solicit any of Owner's or its affiliates'
non-clerical employees, agents or independent contractors to end their
relationship with Owner or its affiliates.
1(d) Confidential Information. Each of the members
of the Managing Group shall hold in a fiduciary capacity for the benefit of
the Partnership and the Corporation all
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trade secrets and confidential information, knowledge or data relating to
Owner and its business and investments, which shall have been obtained by the
Managing Company during its engagement by Owner or Xx. Xxxxxxxx or Xx. Xxxxxx
during his or her service as a director or officer of the Corporation, and
which is not generally available public knowledge (other than by acts by
members of the Managing Group in violation or this Agreement). Each member of
the Managing Group shall not, without the prior written consent of the
Partnership or Corporation or as may otherwise be required by law or any legal
process, or as is necessary in connection with any adversarial proceeding
against the Partnership or Corporation (in which case the members of the
Managing Group shall cooperate with the Partnership and/or Corporation, at the
expense of the Partnership and/or Corporation, in the Partnership and/or
Corporation seeking to obtain a protective order against disclosure by a court
of competent jurisdiction), communicate or divulge any such trade secrets,
information, knowledge or data to anyone other than the Partnership and/or
Corporation in furtherance of its or his business or to perform duties
hereunder.
1(e) Removal of Documents. All records, files,
drawings, documents, models, equipment, and the like relating to the business
of the Partnership or Corporation which any member of the Managing Group has
control over shall not be removed from the premises of the Partnership or
Corporation without the written consent of the Partnership or Corporation, as
the case may be, unless such removal is in the furtherance of the business of
the Partnership or Corporation and, if so removed, shall be returned to the
Partnership or Corporation, as the case may be, promptly after termination of
the employment of Xx. Xxxxxxxx or Xx. Xxxxxx or engagement of the Managing
Company by the Partnership and/or Corporation, as the case may be, or
otherwise promptly after removal if such removal occurs following termination
of employment or engagement. Rolodexes, telephone directories and similar type
items, and
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furniture, art works and property owned by members of the Managing Group or
otherwise not owned by the Partnership or Corporation shall not be deemed
property of the Partnership or Corporation and shall not be covered by this
Section 1(e). The Partnership and/or Corporation shall be the owner of all
trade secrets and other products relating to the Partnership's and/or
Corporation's business developed by members of the Managing Group alone or in
conjunction with others as part of the Managing Company serving as manager for
Owner.
1(f) Specific Performance. Each of the Managers
acknowledges that the Partnership and Corporation will have no adequate remedy
at law if any of the Managers shall fail to perform any of its or his
obligations hereunder, and each of the Managers therefore confirms that the
right of the Partnership and Corporation to specific performance of the terms
of this Section 1 is essential to protect the rights and interests of the
Partnership and Corporation. Accordingly, in addition to any other remedies
that the Partnership and Corporation may have at law or in equity, the
Partnership and Corporation shall have the right to have all obligations,
agreements and other provisions of this Section 1 specifically performed by
the Managers, and the Partnership and Corporation shall have the right to
obtain preliminary injunctive relief to secure specific performance and to
prevent a breach of this Section 1 by the Managers without a requirement to
post any bond.
1(g) If, at the time of enforcement of this Section
1, a court shall hold that the duration, scope, area or other restriction
stated herein is unreasonable, the parties hereto agree that reasonable
maximum duration, scope, area or other restriction may be substituted by such
court for the stated duration, scope, area or other restriction.
2. Miscellaneous.
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2(a) Integration; Amendment. This Agreement
supersedes and renders of no force and effect all prior understandings and
agreements with respect to the matters set forth herein. No amendments or
additions to this Agreement shall be binding unless in writing and signed by
all of the parties.
2(b) Assignment. No rights or obligations of the
Partnership or Corporation under this Agreement may be assigned or
transferred, except in connection with a merger, consolidation or sale of all
or substantially all of the assets of the Partnership or Corporation, as the
case may be, where the successor of the Partnership or Corporation, as the
case may be, expressly assumes and agrees to perform this Agreement in the
same manner and to the same extent that the Partnership or Corporation, as the
case may be, would be required to perform it if no such succession had taken
place; provided that the forgoing shall not serve as a release of the
Partnership or Corporation, as the case may be. None of the Managers may
assign this Agreement or any right or interest therein, whether by operation
of law or otherwise, without the prior written consent of the Partnership
and/or Corporation, as the case may be.
2(c) 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 Section 1(g) 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. In addition, in place of such invalid or unenforceable
provision, there shall automatically be added hereto a provision as similar to
such invalid or unenforceable provision as may be possible and still be valid
and enforceable.
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2(d) Waivers. The failure or delay of any party at
any time to require performance by any other party of any provision of this
Agreement, even if known, shall not affect the right of such party to require
performance of that provision or to exercise any right, power, or remedy
hereunder, and any waiver by any party of any breach of any provision of this
Agreement shall not be construed as a waiver of any continuing or succeeding
breach of such provision, a waiver of the provision itself, or a waiver of any
right, power or remedy under this Agreement. No notice to or demand on any
party in any case shall, of itself, entitle such party to other or further
notice or demand in similar or the circumstances.
2(e) Burden and Benefit. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective heirs, executors, personal and legal representatives, successors
and, subject to Section 2(b) above, assigns.
2(f) Governing Law; Headings. This Agreement and
its construction, performance, and enforceability shall be governed by, and
construed in accordance with, the laws of the State of New York without regard
to provisions of conflict of laws. Headings and titles herein are included
solely for convenience and shall not affect, or be used in connection with,
the interpretation of this Agreement.
2(g) Notices. All notices called for under this
Agreement shall be in writing and shall be deemed to be sufficient if
contained in a written instrument delivered (i) in person, (ii) by first class
registered or certified mail, postage prepaid and return receipt requested,
(iii) by overnight delivery by a recognized courier service providing a
receipt, or (iv) by facsimile transmission confirmed by transmission report,
addressed to the intended recipient at the address set forth on the signature
page hereof (or at such other address for a party as shall be specified by
like notice). Any notice delivered to the party hereto to whom it is addressed
shall
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be deemed to have been given on the day it was received; provided,
however, that if such day is not a business day, then the notice shall be
deemed to have been given and received on the business day next following such
day. If the other party is aware that the intended recipient is not at the
notice location, either permanently or temporarily, notice also shall be sent
to such location as the notifying party becomes aware (after reasonable
inquiry) that the intended recipient is then located.
2(h) Counterparts. This Agreement may be executed
in one or more counterparts, each of which counterparts shall be deemed to be
an original, and all such counterparts shall constitute one and the same
instrument.
2(i) Number and Gender. When the context in which
the words are used in this Agreement indicates that such is the intent, words
in singular number shall include the plural and vice-versa. All terms and
words used in this Agreement, regardless of the sex or gender in which they
are used shall be deemed to include each other sex and gender unless the
context requires otherwise.
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IN WITNESS WHEREOF, the parties have duly executed this
Agreement, or caused this Agreement to be duly executed on their behalf, as of
the date first above written.
PHILIPS INTERNATIONAL REALTY CORP.
By: /s/ Xxxxx X. Petra
--------------------------
Name: Xxxxx X. Xxxxx
Title: President
Address: 000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
PHILIPS INTERNATIONAL REALTY, L.P.
By: PHILIPS INTERNATIONAL REALTY CORP.
a general partner
By: /s/ Xxxxx X. Petra
--------------------------
Name: Xxxxx X. Xxxxx
Title: President
Address: 000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
PHILIPS INTERNATIONAL HOLDING CORP.
By: /s/ Xxxxxx Xxxxxxxx
--------------------------
Name: Xxxxxx Xxxxxxxx
Title: President
Address: 000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
/s/ Xxxxxx Xxxxxxxx
--------------------------
Xxxxxx Xxxxxxxx, individually
Address: 000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
/s/ Xxxxxx Xxxxxx
--------------------------
Xxxxxx Xxxxxx, individually
Address: 000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
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