Exhibit 10.13
AMENDED AND RESTATED NON-COMPETITION AGREEMENT
THIS AMENDED AND RESTATED NON-COMPETITION AGREEMENT (the "Agreement") is
entered into as of August 2, 2004 by and among Xxxxxxx X. Xxxxxxx (the
"Stockholder"), Xxxxxxx GRP, Inc., a Delaware corporation (the "Company"),
Xxxxxxx Holdings, Inc., a Delaware corporation ("Holdings"), and the parties set
forth on the signature pages hereto as Investors (the "Investors").
WITNESSETH
WHEREAS, the Company, Holdings and the Investors have entered into a
certain Contribution and Asset Transfer Agreement, dated as of June 29, 2004
(the "Contribution Agreement"), by and among the Company, Holdings, Stockholder,
the Investors, the Sellers named therein (the "Sellers") and the other
stockholders of certain of the Sellers as named therein, pursuant to which the
Company and Holdings have agreed to purchase substantially all of the assets and
to assume certain liabilities of the Sellers;
WHEREAS, as contemplated by the Contribution Agreement (i) certain of the
Investors, through the purchase of Convertible Preferred Stock of Holdings and
(ii) certain of the Investors and their affiliates, through the purchase of
Subordinated Notes of the Company and Common Stock of Holdings pursuant to a
certain Subordinated Note and Common Stock Purchase Agreement, are providing
funds necessary for the Company and Holdings to consummate the purchase and sale
transactions contemplated by the Contribution Agreement;
WHEREAS, the Sellers will hold a proportionate amount of the funds and
shares they receive pursuant to the Contribution Agreement for the benefit of,
or distribute a proportionate amount of the funds and shares they receive
pursuant to the Contribution Agreement to, the Stockholder, and, accordingly,
the Stockholder shall derive a substantial benefit from such transactions;
WHEREAS, the Company is a subsidiary of Holdings; and
WHEREAS, Sellers (immediately prior to the date hereof) were, and the
Company (as of the date hereof) is, in the business of providing advisory
products and services relating to residential, consumer and commercial loan
asset classes, including (i) portfolio due diligence, advice, data collection,
management and analysis, (ii) regulatory and operational compliance reporting,
(iii) credit underwriting, and (iv) loan valuation, in each case to financial
institutions, including investment banking firms, mortgage companies, commercial
banks, thrifts, government sponsored enterprises, rating agencies, mortgage
insurance companies and bond insurers (together with any other businesses or
activities conducted by the Company and its subsidiaries from time to time, the
"Company Business");
WHEREAS, the Company Business has been, and is presently contemplated to
be, conducted throughout the United States and Canada, and the reputation and
goodwill of the Company are an integral part of its business success; and
WHEREAS, in order to provide the Investors with the full benefits of their
investment, the Stockholder has agreed to execute and deliver this Agreement.
NOW, THEREFORE, in consideration of the mutual promises and covenants set
forth herein, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound, agree as follows:
Section 1. EFFECTIVE DATE. The Stockholder, the Company, Holdings and the
Investors agree that this Agreement is being entered into in connection with the
consummation of the transactions contemplated by the Contribution Agreement, and
that this Agreement is effective as of the date hereof (the "Effective Date").
Section 2. NON-COMPETITION; NON-SOLICITATION. In view of the fact that any
activity of the Stockholder or any Seller or any other person or entity subject
hereto in violation of the terms hereof would materially and adversely affect
the Company Business and would deprive the Investors under the Contribution
Agreement of the benefits of their bargains and investments thereunder, and to
preserve the goodwill associated with the Company Business, the Stockholder
hereby agrees on behalf of itself and each Seller to the following restrictions:
(a) STOCKHOLDER COVENANTS. The Stockholder hereby agrees that
during the period commencing on the Effective Date and ending on the date
which is the later of five (5) years after the Effective Date or two (2)
years after termination of Stockholder's employment with the Company and its
subsidiaries for any reason, he will not, without the express written consent
of the Company, directly or indirectly (through any Seller or any other
subsidiary, affiliate or controlled entity of the Stockholder) (collectively,
the "Seller Entities," and individually, a "Seller Entity"), and will cause
each Seller Entity not to, anywhere in the states of New York, New Jersey,
California, Connecticut, Florida and Oklahoma, or any other state in the
United States or in Canada: (i) engage in any activity which is competitive
with any of the business, activities, products or services conducted or
offered by any of the Company, any direct or indirect subsidiary of the
Company or Holdings or any other direct or indirect subsidiary of Holdings
(collectively, the "Company Entities," and individually, the "Company
Entity"), which business, activities, products and services shall include, in
any event and without limitation, the Company Business (any such activity, a
"Competitive Activity"), or (ii) participate or invest in, provide or
facilitate the provision of financing to, or assist (whether as owner,
part-owner, shareholder, member, partner, director, officer, trustee,
employee, agent or consultant, or in any other capacity) any business,
organization or person other than the Company, Holdings, or any of their
respective direct or indirect subsidiaries, whose business, activities,
products or services are competitive with any of the business, activities,
products or services conducted or offered by any Company Entity, which
business, activities, products and services shall include, in any event and
without limitation, the Company Business. Without implied limitation, the
forgoing covenant shall prohibit Stockholder from (A) hiring or engaging or
attempting to hire or engage for or on behalf of the Stockholder, any Seller
Entity or any such competitor, any officer or employee of any Company Entity,
or any former officer or employee of any Company Entity or any Seller Entity
who was employed by any Company Entity or any Seller Entity at any time
within the eighteen (18) month period prior to the date of such hiring or
engaging or attempt to hire or engage (provided, that during the last six (6)
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months of such eighteen (18) month period, if the Stockholder seeks the
Company's consent to such hiring or engaging, such consent shall not be
unreasonably withheld or delayed), (B) encouraging, for or on behalf of the
Stockholder, any Seller Entity, or any such competitor, any such officer or
employee or any such former officer or employee to terminate his or her
relationship or employment with any Company Entity, (C) soliciting, for or on
behalf of the Stockholder, any Seller Entity or any such competitor, any
client of any Company Entity or any person or entity who was a client of any
Company Entity or Seller within the eighteen (18) month period prior to the
date of such solicitation, and (D) diverting to any person any client or
business opportunity of any Company Entity.
Notwithstanding anything herein to the contrary, the Stockholder may (1) make
passive investments in any publicly traded enterprise if such investment
constitutes less than five percent (5%) of the equity of such enterprise, and
(2) engage in the business of purchasing and selling, or investing in entities
specially established for the purpose of purchasing and selling, real estate
and/or pools of performing, sub-performing and non-performing mortgage,
automobile and other types of loans and financial instruments, and managing such
investments, in each case in a manner consistent in nature with the
Stockholder's past and current involvement in such activities through the date
hereof (the activities described in clauses (2) and (3), the "Permitted
Activities").
(b) STOCKHOLDER REPRESENTATION. Neither the Stockholder nor any
Seller Entity (other than the Sellers) is a party to any contract,
commitment, arrangement or agreement which could, following the Effective
Date, restrain or restrict the Company Entities from carrying on the Company
Business or restrain or restrict the Stockholder from performing the
Stockholder's employment obligations, and, as of the date of this Agreement,
neither the Stockholder nor any Seller Entity is involved in any business
activities whatsoever in or relating to the industries in which the Sellers
currently engage other than the Stockholder's and/or such Selling Entity's
interest in the Company and other than the Permitted Activities.
(c) SUBSIDIARIES. For purposes of this Agreement, any reference to
a (i) "subsidiary" or "subsidiaries" of an entity shall be deemed to include
any entities directly or indirectly controlled by it through an ownership of
more than fifty percent (50%) of the voting interests and (ii) the term
"person" shall mean an individual, a corporation, an association, a
partnership, a limited liability company, an estate, a trust, and any other
entity or organization.
Section 3. SCOPE OF AGREEMENT. The parties acknowledge that the time,
scope, geographic area and other provisions of this Agreement have been
specifically negotiated by sophisticated commercial parties, and they agree that
(a) all such provisions are reasonable under the circumstances of the
transactions contemplated hereby, (b) are given as an integral and essential
part of the transactions contemplated hereby and (c) but for the covenants of
the Stockholder contained in this Agreement, the Company, Holdings and the
Investors would not have entered into or consummated the transactions
contemplated by the Contribution Agreement. The Stockholder has independently
consulted with counsel and has been advised in all respects concerning the
reasonableness and propriety of the covenants contained herein, with specific
regard to the business currently contemplated to be conducted by the Company
Entities, and represents that the Agreement is intended to be, and shall be,
fully enforceable and effective in
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accordance with its terms.
Section 4. CERTAIN REMEDIES; SEVERABILITY. It is specifically understood
and agreed that any breach of the provisions of this Agreement by Stockholder or
any Seller Entity will result in irreparable injury to the Company Entities,
that the remedy at law alone will be an inadequate remedy for such breach and
that, in addition to any other remedy it may have, each of the Company, Holdings
and each Investor shall be entitled to enforce the specific performance of this
Agreement through both temporary and permanent injunctive relief without the
necessity of proving actual damages, but without limitation of their right to
damages and any and all other remedies available to them, it being understood
that injunctive relief is in addition to, and not in lieu of, such other
remedies. In the event that any covenant contained in this Agreement shall be
determined by any court of competent jurisdiction to be unenforceable by reason
of its extending for too great a period of time or over too great a geographical
area or by reason of its being too extensive in any other respect, it shall be
interpreted to extend only over the maximum period of time for which it may be
enforceable and/or over the maximum geographical area as to which it may be
enforceable and/or to the maximum extent in all other respects as to which it
may be enforceable, all as determined by such court in such action. The
existence of any claim or cause of action which the Stockholder may have against
any Company Entity shall not constitute a defense or bar to the enforcement of
any of the provisions of this Agreement.
Section 5. JURISDICTION. The parties hereby irrevocably submit to the
non-exclusive jurisdiction of the courts of the State of Connecticut to construe
and enforce the covenants contained in this Agreement. In the event that the
courts of any state shall hold such covenants unenforceable (in whole or in
part) by reason of the breadth of such scope or otherwise, it is the intention
of the parties hereto that such determination shall not bar or in any way affect
the right of the Company Entities to the relief provided for herein in the
courts of any other state within the geographic scope of such covenants, as to
breaches of such covenants in such other respective states, the above covenants
as they relate to each state being, for this purpose, severable into diverse and
independent covenants.
Section 6. NOTICES. Any notice or demand which is required or provided to
be given under this Agreement shall be deemed to have been sufficiently given
and received for all purposes when delivered by hand, telecopy or other method
of facsimile, or five days after being sent by certified or registered mail,
postage and charges prepaid, return receipt requested, or two days after being
sent by overnight delivery providing receipt of delivery, to the following
addresses (or at such other address for any party as shall be specified by
notice given in accordance with the provisions hereof, provided that notices of
a change of address shall be effective only upon receipt thereof):
IF TO THE COMPANY OR HOLDINGS:
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c/o TA Associates, Inc.
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx
Facsimile: (000) 000-0000
IF TO THE INVESTORS:
c/o TA Associates, Inc.
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx
Facsimile: (000) 000-0000
IF TO THE STOCKHOLDER:
Xxxxxxx X. Xxxxxxx
Section 7. MISCELLANEOUS. This Agreement shall be governed by and construed
under the laws of the State of Connecticut and shall not be modified or
discharged in whole or in part except by an agreement in writing signed by
Holdings, the Company, the Investors and the Stockholder. The failure of any of
the parties to require the performance of a term or obligation or to exercise
any right under this Agreement or the waiver of any breach hereunder shall not
prevent subsequent enforcement of such term or obligation or exercise of such
right or the enforcement at any time of any other right hereunder or be deemed a
waiver of any subsequent breach of the provision so breached, or of any other
breach hereunder. This Agreement shall inure to the benefit of, and be binding
upon, successors of the Company and Holdings by way of merger, consolidation or
transfer of substantially all the assets of the Company or Holdings, and may not
be assigned by the Stockholder. This Agreement supersedes all prior
understandings and agreements between the parties relating to the subject matter
hereof.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties have executed this Non-Competition
Agreement under seal as of the date first set forth above.
COMPANY:
XXXXXXX GRP, INC.
By: /s/ Xxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxx
Title: President
HOLDINGS:
XXXXXXX HOLDINGS, INC.
By: /s/ Xxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxx
Title: President
STOCKHOLDER:
/s/ Xxxxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxx
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INVESTORS:
TA IX L.P.
By: TA Associates IX LLC, its General
Partner
By: TA Associates, Inc., its Manager
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Managing Director
TA/ATLANTIC AND PACIFIC IV L.P.
By: TA Associates AP IV L.P., its General
Partner
By: TA Associates, Inc., its General Partner
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Managing Director
TA STRATEGIC PARTNERS FUND A
L.P.
By: TA Associates SPF L.P., its General
Partner
By: TA Associates, Inc., its General Partner
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Managing Director
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TA STRATEGIC PARTNERS FUND B
L.P.
By: TA Associates SPF L.P., its General
Partner
By: TA Associates, Inc., its General Partner
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Managing Director
TA INVESTORS II, L.P.
By: TA Associates, Inc., its General Partner
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Managing Director
TA SUBORDINATED DEBT FUND, L.P.
By: TA Associates SDF LLC, its General
Partner
By: TA Associates, Inc., its Manager
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Managing Director
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