EXHIBIT 10 (a)(4)
NONDISCLOSURE AND NON-COMPETE AGREEMENT
This Agreement is entered into as of the 31st day of December, 2002 by and
between Universal Forest Products, Inc., and its affiliates and subsidiaries,
0000 Xxxx Xxxxxxxx XX, Xxxxx Xxxxxx, XX 00000 (herein "UFP"), and Xxxxx X.
Xxxxxxx, an individual, of 0000 Xxxxxxx XX, Xxxxx Xxxxxx, XX 00000 (herein
"Secchia").
RECITALS
X. Xxxxxxx intends to retire as an officer of UFP as of December 31, 2002.
UFP wishes to restrict his services from being provided to any
competitors of UFP.
The Parties agree as follows:
SECTION 1. DISCLOSURE OF INFORMATION.
Secchia acknowledges that UFP's trade secrets, private or secret
processes as they exist from time to time, and information concerning customers
and their identity, products, developments, manufacturing techniques, new
product plans, equipment, inventions, discoveries, patent applications, ideas,
designs, engineering drawings, sketches, renderings, other drawings,
manufacturing and test data, computer programs, progress reports, materials,
costs, specifications, processes, methods, research, procurement and sales
activities and procedures, promotion and pricing techniques, and credit and
financial data concerning customers of UFP, as well as information relating to
the management, operation, or planning of UFP, herein the ("Proprietary
Information") are valuable, special, and unique assets of UFP, access to and
knowledge of which may be essential to the performance of Secchia's duties under
this Agreement. In light of the highly competitive nature of the industries in
which UFP conducts businesses, Secchia agrees that all Proprietary Information
obtained by Secchia as a result of its relationship with UFP shall be considered
confidential. In recognition of this fact, Secchia agrees that except as may be
necessary for UFP's benefit, in Secchia's reasonable judgment, Secchia will not,
during and after the Non-Compete Period, disclose any of such Proprietary
Information to any person or entity for any reason or purpose whatsoever without
the written consent of UFP, and Secchia will not make use of any Proprietary
Information for Secchia's own purposes or for the benefit of any other person or
entity (except UFP) under any circumstances.
SECTION 2. NON-COMPETITION AGREEMENT.
In order to further protect the confidentiality of the Proprietary
Information and in recognition of the highly competitive nature of the
industries in which UFP conducts its businesses, and for the consideration set
forth herein, Secchia further agrees that during and for the period commencing
on January 1, 2003 and ending on December 31, 2009 (the "Non-Compete Period"):
2.1 Secchia will not directly or indirectly engage in any Business
Activities (hereinafter defined), other than on behalf of UFP, whether such
engagement is as an officer, director, proprietor, employee, partner, investor
(other than as a holder of less than 1% of the outstanding capital stock of a
publicly-traded corporation), advisor, agent, or other participant, in any
geographic area in which the products or services of UFP have been distributed
or provided during the period of Secchia's consulting relationship with UFP. For
purposes of this Agreement, the term "Business Activities" shall mean the
design, development, manufacture, sale, marketing, or servicing of UFP's
products, together with all other activities engaged in by UFP or any of its
subsidiaries at any time during Secchia's relationship with UFP, and activities
in any way related to activities with respect to which Secchia renders
consulting services under this Agreement.
2.2 Secchia will not directly or indirectly engage in any of the
Business Activities (other than on behalf of UFP) by supplying products or
providing services to any customer with whom UFP has done any business during
the consulting relationship with UFP, whether such engagement is as an officer,
director, proprietor, employee, partner, investor (other than as a holder of
less than one percent (1%) of the outstanding capital stock of a publicly traded
corporation), advisor, agent, or other participant.
2.3 ASSISTANCE TO OTHERS. Secchia will not directly or indirectly
assist others in engaging in any of the Business Activities in any manner
prohibited to Secchia under this Agreement.
2.4 UFP'S EMPLOYEES. Secchia will not directly or indirectly induce
employees of UFP to engage in any activity hereby prohibited to Secchia or to
terminate their employment with UFP.
2.5 NON-COMPETE PAYMENTS. In exchange for Secchia's agreements and
obligations under this Section 2, Secchia will receive a payment of Twelve
Thousand Five Hundred Dollars ($12,500.00) per month for the term of the
Non-Compete Period, subject to earlier termination upon the death or Disability
of Secchia. Disability shall mean a physical or mental injury or illness that
totally and permanently renders Secchia unable to perform all of the functions
called for under this Agreement.
SECTION 3. INTERPRETATION.
Although Secchia and UFP consider the restrictions contained in
Sections 1 and 2 of this Agreement reasonable for the purpose of preserving the
goodwill, proprietary rights, and going concern value of UFP, if a final
judicial determination is made by a
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court having jurisdiction that the time or territory or any other restriction
contained in Section 2 is an unenforceable restriction on the activities of
Secchia, the provisions of such restriction shall not be rendered void but shall
be deemed amended to apply as to such maximum time and territory and to such
other extent as such court may judicially determine or indicate to be
reasonable. Alternatively, if the court referred to above finds that any
restriction contained in Section 2 or any remedy provided in Section 4 of this
Agreement is unenforceable, and such restriction or remedy cannot be amended so
as to make it enforceable, such finding shall not affect the enforceability of
any of the other restrictions contained in this Agreement or the availability of
any other remedy. The provisions of Sections 1 and 2 shall in no respect limit
or otherwise affect the obligations of Secchia under other agreements with UFP.
SECTION 4. REMEDIES.
Secchia acknowledges and agrees that UFP's remedy at law for a breach
or threatened breach of any of the provisions of Sections 1 and 2 of this
Agreement would be inadequate and, in recognition of this fact, in the event of
a breach or threatened breach by Secchia of any of the provisions of Sections 1
and 2, Secchia agrees that, in addition to its remedies at law, at UFP's option,
all rights of Secchia, and obligations of UFP, under this Agreement may be
terminated. UFP shall be entitled to equitable relief in the form of specific
performance, temporary restraining order, temporary or permanent injunction, or
any other equitable remedy which may then be available. UFP shall not be
required to post bond, and Secchia agrees not to oppose UFP's request for
equitable relief. Secchia acknowledges that the granting of a temporary
injunction, temporary restraining order or permanent injunction merely
prohibiting the use of Proprietary Information would not be an adequate remedy
upon breach or threatened breach of Sections 1 and 2, and consequently agrees
upon any such breach or threatened breach to the granting of injunctive relief
prohibiting the design, development, manufacture, marketing or sale of products
and providing of services of the kind designed, developed, manufactured,
marketed, sold or provided by UFP or its subsidiaries during the term of
Secchia's relationship with UFP. Nothing contained in this Section 4 shall be
construed as prohibiting UFP from pursuing, in addition, any other remedies
available to it for such breach or threatened breach.
SECTION 5. MISCELLANEOUS PROVISIONS.
5.1 ASSIGNMENT. This Agreement shall not be assignable by either party,
except by UFP to any subsidiary or affiliate of UFP (now or hereafter existing)
or to any successor in interest to UFP's business, provided that in the case of
an assignment to an affiliate or subsidiary, UFP shall remain liable as a
guarantor for payments due to Secchia hereunder.
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5.2 BINDING EFFECT. The provisions of this Agreement shall be binding
upon and inure to the benefit of the heirs, personal representatives,
successors, and assigns of the parties.
5.3 NOTICE. Any notice or other communication required or permitted to
be given under this Agreement shall be in writing and shall be mailed by
certified mail, return receipt requested, postage prepaid, addressed to the
parties at the address stated on the first page of this Agreement. The address
of a party to which notices or other communications shall be mailed may be
changed from time to time by giving written notice to the other party.
5.4 LITIGATION EXPENSE. In the event of a default under this Agreement,
the defaulting party shall reimburse the non-defaulting party for all costs and
expenses reasonably incurred by the non-defaulting party in connection with the
default, including without limitation reasonable attorney's fees. The
non-defaulting party may seek reimbursement in a court of competent
jurisdiction. Additionally, in the event a suit or action is filed to enforce
this Agreement or with respect to this Agreement, the prevailing party or
parties shall be reimbursed by the other party for all costs and expenses
incurred in connection with the suit or action, including without limitation
reasonable attorney's fees at the trial level and on appeal.
5.5 WAIVER. No waiver of any provision of this Agreement shall be
deemed, or shall constitute, a waiver of any other provision, whether or not
similar, nor shall any waiver constitute a continuing waiver. No waiver shall be
binding unless executed in writing by the party making the waiver.
5.6 APPLICABLE LAW. This Agreement shall be governed by and shall be
construed in accordance with the laws of the State of Michigan.
5.7 ENTIRE AGREEMENT. This Agreement constitutes the entire Agreement
between the parties pertaining to its subject matter, and it supersedes all
prior contemporaneous agreements, representations, and understandings of the
parties. No supplement, modification, or amendment of this Agreement shall be
binding unless executed in writing by all parties.
[SIGNATURES ON FOLLOWING PAGE.]
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UNIVERSAL FOREST PRODUCTS, INC.:
By:
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Its:
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Xxxxx X. Xxxxxxx
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