NONCOMPETITION AGREEMENT
Exhibit 10.3
THIS NONCOMPETITION AGREEMENT (this “Agreement”) is entered into as of June 5, 2006 by and
between U-STORE-IT TRUST, a Maryland real estate investment trust (the “Company”), and Xxxxxxxxxxx
X. Xxxx (the “Executive”).
WHEREAS, concurrently with the execution and delivery of this Agreement, the Company and the
Executive are entering into an Employment Agreement dated as of the date hereof, pursuant to which,
among other things, the Company has agreed to employ the Executive, and the Executive has agreed to
be employed by the Company, in accordance with the terms thereof (the “Employment Agreement”); and
WHEREAS, the Company and the Executive agree that the Executive will not engage in competition
with the Company and will refrain from taking certain other actions pursuant to the terms and
conditions hereof in an effort to protect the Company’s legitimate business interests and goodwill
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. Noncompetition. The Executive agrees with the Company that for the longer of (i)
the three-year period beginning on the date of this Agreement or (ii) the period during which the
Executive is employed by, or serving as an officer or trustee or director of, the Company,
U-Store-It, L.P., a Delaware limited partnership, of which the Company is the general partner or
any of their direct or indirect subsidiaries (collectively, the “REIT”), and for one year
thereafter (the “Restricted Period”), the Executive will not, (a) directly or indirectly, engage in
any business involving self-storage facility development, construction, acquisition or operation,
whether such business is conducted by the Executive individually or as a principal, partner,
member, stockholder, director, trustee, officer, employee or independent contractor of any Person
(as defined below) or (b) own any interests in any self-storage facilities, in each case in the
United States of America; provided, however, that this Section 1 shall not be
deemed to prohibit the direct or indirect ownership by the Executive of up to five percent of the
outstanding equity interests of any public company. For purposes of this Agreement, “Person” means
any individual, firm, corporation, partnership, company, limited liability company, trust, joint
venture, association or other entity.
2. Nonsolicitation. The Executive agrees with the Company that for the longer of (i)
the three-year period beginning on the date of this Agreement or (ii) the period during which the
Executive is employed by, or serving as an officer or trustee or director of, the REIT, and for two
years thereafter, such Executive will not (a) directly or indirectly solicit, induce or encourage
any employee or independent contractor to terminate their employment with the REIT or to cease
rendering services to the REIT, and the Executive shall not initiate discussions with any such
Person for any such purpose or authorize or knowingly cooperate with the taking of any such actions
by any other Person, or (b) hire (on behalf of the Executive or any other person
or entity) any employee or independent contractor who has left the employment or other service
of the REIT (or any predecessor
thereof) within one year of the termination of such employee’s or
independent contractor’s employment or other service with the REIT.
3. Reasonable and Necessary Restrictions. The Executive acknowledges that the
restrictions, prohibitions and other provisions hereof, including, without limitation, the
Restricted Period set forth in Section 2, are reasonable, fair and equitable in terms of duration,
scope and geographic area, are necessary to protect the legitimate business interests of the REIT,
and are a material inducement to the Company to enter into this Agreement and the Employment
Agreement.
4. Specific Performance. The Executive acknowledges that the obligations undertaken
by such Executive pursuant to this Agreement are unique and that the Company likely will have no
adequate remedy at law if the Executive shall fail to perform any of such Executive’s obligations
hereunder, and the 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 the 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 the Executive. Further, the Executive agrees to
indemnify and hold harmless the Company from and against any reasonable costs and expenses incurred
by the Company as a result of any breach of this Agreement by such Executive, and in enforcing and
preserving the Company’s rights under this Agreement, including, without limitation, the Company’s
reasonable attorneys’ fees. The Executive hereby acknowledges and agrees that the Company shall
not be required to post bond as a condition to obtaining or exercising such remedies, and the
Executive hereby waives any such requirement or condition. If the Executive is the prevailing
party in any action in which the Company seeks to enforce its rights under this Agreement, the
Company agrees to indemnify and hold harmless the Executive from and against any reasonable costs
and expenses incurred by the Executive as a result of such action, including, without limitation,
the Executive’s reasonable attorneys’ fees.
5. Miscellaneous Provisions.
5.1 Assignment; Binding Effect. This Agreement may not be assigned by the Executive,
but may be assigned by the Company to any successor to its business and will inure to the benefit
of and be binding upon any such successor. Subject to the foregoing provisions 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 the respective successors, assigns, heirs, and
personal representatives.
5.2 Entire Agreement. This Agreement, together with the Employment Agreement,
constitutes the entire agreement between the parties hereto
with respect to the matters set forth herein and supersedes and renders of no force and effect all
prior oral or written agreements, commitments and understandings among the parties with respect to
the matters set forth herein. This Section 5.2 shall not be used to limit or restrict the rights
or remedies, whether express or implied, of any noncompetition or nonsolicitation policies of the
REIT applicable to the Executive.
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5.3 Amendment. 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.
5.4 Waivers. No waiver by a party hereto shall be effective unless made in a written
instrument duly executed by the party against whom such waiver is sought to be enforced, and only
to the extent set forth in such instrument. Neither the waiver by either of the parties hereto of
a breach or a default under any of the provisions of this Agreement, nor the failure of either of
the parties, on one or more occasions, to enforce any of the provisions of this Agreement or to
exercise any right or privilege hereunder shall thereafter be construed as a waiver of any
subsequent breach or default of a similar nature, or as a waiver of any such provisions, rights or
privileges hereunder.
5.5 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, as though not
herein contained, and the remainder of this Agreement shall remain operative and in full force and
effect. Notwithstanding the foregoing, in the event that the restrictions against engaging in
competitive activity contained in this Agreement shall be determined by any court of competent
jurisdiction to be unenforceable by reason of their extending for too great a period of time or
over too great a geographical area or by reason of their being too extensive or unreasonable in any
other respect, the Agreement shall be interpreted to extend only over the maximum period of time
for which it may be enforceable and over the maximum geographical area as to which it may be
enforceable and to the maximum extent in all other respects as to which it may be enforceable, all
as determined by such court in such action and the court may limit the application of any other
provision or covenant, or modify any such term, provision or covenant and proceed to enforce this
Agreement as so limited or modified. To the extent necessary, the parties shall revise the
Agreement and enter into an appropriate amendment to the extent necessary to implement any of the
foregoing.
5.6 Governing Law; Jurisdiction. 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 Ohio, but not including the choice-of-law rules thereof.
5.7 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.
5.8 Executive’s Acknowledgement. The Executive acknowledges (i) that he has had the
opportunity to consult with independent counsel of his own choice concerning this Agreement, and
(ii) that he has read and understands this Agreement, is fully aware of its legal effect, and has
entered into it freely based on his own judgment.
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5.9 Notices. All notices, requests, demands, and other communications hereunder shall
be in writing and shall be deemed to have been delivered (i) when physically received by personal
delivery (which shall include the confirmed receipt of a telecopied facsimile transmission), or
(ii) three business days after being deposited in the United States certified or registered mail,
return receipt requested, postage prepaid or (iii) one business day after being deposited with a
nationally known commercial courier service providing next day delivery service (such as Federal
Express), to the following addresses:
| (i) | if to the Executive, to the address set forth in the records of the Company; and | ||
| (ii) | if to the Company, |
U-Store-It Trust
0000 Xxxxx Xxxx
Xxxxx 000
Xxxxxxxxxx Xxxxxxx, XX 00000
Attn: Xxxx Xxxxxxxx
Facsimile No.: (000) 000-0000
0000 Xxxxx Xxxx
Xxxxx 000
Xxxxxxxxxx Xxxxxxx, XX 00000
Attn: Xxxx Xxxxxxxx
Facsimile No.: (000) 000-0000
with a copy to:
U-Store-It Trust
0000 Xxxxx Xxxx
Xxxxx 000
Xxxxxxxxxx Xxxxxxx, XX 00000
Attn: Xxxxxxxx X. Xxxxxxx
Facsimile No.: (000) 000-0000
0000 Xxxxx Xxxx
Xxxxx 000
Xxxxxxxxxx Xxxxxxx, XX 00000
Attn: Xxxxxxxx X. Xxxxxxx
Facsimile No.: (000) 000-0000
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5.10 Execution in Counterparts. To facilitate execution, this Agreement may be
executed in as many counterparts as may be required. It shall not be necessary that the signature
of or on behalf of each party appears on each counterpart, but it shall be sufficient that the
signature of or on behalf of each party appears on one or more of the counterparts. All
counterparts shall collectively constitute a single agreement.
IN WITNESS WHEREOF, each of the undersigned has executed and delivered this Agreement, or
caused this Agreement to be duly executed on its behalf, as of the date first set forth above.
| THE EXECUTIVE: |
||||
| /s/ Xxxxxxxxxxx X. Xxxx | ||||
| Xxxxxxxxxxx X. Xxxx | ||||
| THE COMPANY: U-STORE-IT TRUST |
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| By: | /s/ Xxxx Xxxxxxxx | |||
| Name: | Xxxx Xxxxxxxx | |||
| Title: | President and Chief Executive Officer | |||
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