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EXHIBIT 2.02
NON-COMPETITION AGREEMENT
This Non-Competition Agreement (this "AGREEMENT") is made and entered
into as of October 6, 1999 (the "EXECUTION DATE") by and among Intuit Inc., a
Delaware corporation ("INTUIT") and Rock Financial Corporation, a Michigan
corporation ("ROCK"), on the one hand, and Daniel Gilbert ("EMPLOYEE"), on the
other hand.
R E C I T A L S
A. Concurrently with the execution of this Agreement, Intuit, Merger Sub
1, Inc., a Michigan corporation that is a wholly-owned subsidiary of Intuit
("MERGER SUB 1") and Rock have entered into an Agreement and Plan of Merger
dated as of October 6, 1999 (the "PLAN"), which provides, among other things,
for the merger (the "MERGER") of Merger Sub 1 with and into Rock, with Rock to
be the surviving corporation of the Merger. Upon the effectiveness of the
Merger, the outstanding capital stock of Rock will be converted into shares of
Intuit Common Stock and the outstanding Rock stock options will be converted
into options to purchase shares of Intuit Common Stock, in the manner and on the
basis set forth in the Plan. Capitalized terms that are used in this Agreement
and that are not defined herein shall have the same respective meanings that are
given to such terms in the Plan.
B. Employee owns Common Stock of Rock and is an officer, director and
key employee of Rock, and upon the effectiveness of the Merger, will receive
shares of Intuit Common Stock having substantial value by virtue of the
conversion of Employee's Rock Common Stock in the Merger. Employee's talents and
abilities are critical to Rock's ability to continue to successfully to carry on
its business.
C. One of the material conditions precedent to the obligation of Intuit
to consummate the Merger under the Plan is that Employee has executed, entered
into and is bound by this Agreement with Intuit and Rock. Employee is therefore
entering into this Agreement as a material inducement and consideration to
Intuit to enter into the Plan, to issue the consideration payable to Employee
and the other Rock shareholders in the Merger and to consummate the Merger, and
to ensure that Intuit effectively acquires the goodwill of Rock through the
Merger.
NOW, THEREFORE, in consideration of the facts stated in the foregoing
recitals and the promises made herein, Intuit, Rock and Employee hereby agree as
follows:
1. EFFECTIVENESS OF OBLIGATIONS. This Agreement shall become effective
if and only if the Merger is consummated, and shall become effective upon the
date and time that the Merger is consummated and becomes legally effective (such
date and time being hereinafter referred to as the "EFFECTIVE TIME").
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2. CERTAIN DEFINITIONS.
(a) Affiliate. As used herein, the term "AFFILIATE" will have the
meaning given to such term in Rule 405 of Regulation C promulgated under the
Securities Act of 1933, as amended, and refers both to a present and future
Affiliate.
(b) Competing Business. As used herein, the term "COMPETING
BUSINESS" means any business that is competitive with (i) any material element
of Rock's business as conducted at the Effective Time and (ii) any financial
service or product offered, in whole or in part, over the Internet or any other
electronic network, including without limitation any cable-based network or
private network, or offered through call centers, that is marketed or developed
by Intuit (or any of its Affiliates) any time during Employee's employment by
Intuit (or any of its Affiliates) and such marketing or development, as
applicable, has not been discontinued at the applicable time and which was, at
any time during the time that Employee was employed by Intuit (or any of its
Affiliates), either (a) in whole or in part within the scope of Employee's
material employment duties at the time with Intuit (or any of its Affiliates) or
(b) was at any time during the time of such employment, a matter with respect to
which Employee gained substantial knowledge in connection with his employment
with Intuit (or any of its Affiliates) (the businesses described in clause (ii)
hereof being hereafter referred to as "INTUIT BUSINESSES").
(c) Covenant Period. As used herein, the term "COVENANT PERIOD"
means that period of time commencing on the Effective Time and ending on the
fourth (4th) anniversary of the Effective Time.
(d) Engaging in Business. As used in Section 3 of this Agreement
and in this Section 2(d), each of the following activities shall be deemed to
constitute "ENGAGING IN A BUSINESS (INCLUDING THE COMPETING BUSINESS)": to
engage in, carry on, work with, be employed by, consult for, invest in, solicit
customers for, own stock or any other equity or ownership interest in, advise,
lend money to, guarantee the debts or obligations of, contribute, sell or
license intellectual property to, or permit one's name or any part thereof to be
used in connection with, any enterprise or endeavor, either individually, in
partnership or in conjunction with any person, firm, association, partnership,
joint venture, limited liability company, corporation or other business, whether
as principal, agent, stockholder, lender, partner, joint venturer, member,
director, officer, employee or consultant. However, nothing contained in this
Agreement shall prohibit Employee from: (i) being employed by or serving as a
consultant to Intuit (or any other Affiliate of Intuit); (ii) acquiring or
holding at any one time less than two percent (2%) of the outstanding securities
of any publicly traded company (other than any publicly traded company with
respect to which Employee otherwise engaged in any business (as defined in this
Section) in violation of Employee's covenants in Section 3 hereof); (iii)
holding stock of Intuit; or (iv) acquiring or holding an interest in a mutual
fund, limited partnership, venture capital fund or similar investment entity of
which Employee is not an employee, officer or general partner and has no power
to make, participate in or directly influence the investment decisions of such
mutual fund, limited partnership, venture capital fund or investment entity.
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(e) Surviving Corporation. As used herein, the term "SURVIVING
Corporation" means Rock, the surviving corporation of the Merger.
3. NON-COMPETITION AND NON-SOLICITATION COVENANTS.
(a) Non-Competition. Employee hereby covenants and agrees with
Intuit and Rock that, at all times during the Covenant Period, Employee shall
not, either directly or indirectly, engage in any Competing Business (i) in any
state of the United States of America, (ii) in any foreign country in which Rock
has conducted business on or before the Effective Time or thereafter during the
time that Employee is employed by Intuit (or any Affiliate of Intuit)
(including, without limitation, any county, state, territory, possession or
country in which any customer of Rock who utilizes Rock's products or services
is located or in which Rock has solicited business as of the Effective Time); or
(iii) in any country in which Intuit (or any of its Affiliates) conducts any
Intuit Businesses during the time that Employee is employed by Intuit (or any
Affiliate of Intuit).
(b) Non-Solicitation of Customers. In addition to, and not in
limitation of, the non-competition covenants of Employee in Section 3(a) above,
Employee agrees with Intuit and Rock that, at all times during the Covenant
Period, Employee will not, either for Employee or for any other person or
entity, directly or indirectly (other than for Intuit and any of its
Affiliates), solicit business relating to the Competing Business from any
customer of Intuit (or any of its Affiliates).
(c) Non-Solicitation of Employees or Consultants. In addition to,
and not in limitation of, the non-competition covenants of Employee in Section
3(a) above, Employee agrees with Intuit and Rock that, at all times during the
Covenant Period, Employee will not, either for Employee or for any other person
or entity, directly or indirectly, solicit, induce or attempt to induce any
director, employee, consultant or contractor of Intuit, the Surviving
Corporation or any of their Affiliates to terminate his or her employment or
his, her or its services with, Intuit, the Surviving Corporation or any of their
respective Affiliates or to take employment with any other party.
4. SEVERABILITY. Should a court or other body of competent jurisdiction
determine that any term or provision of this Agreement is excessive in scope or
duration or is unenforceable, then the parties agree that such term or provision
shall not be voided or made unenforceable, but rather shall be modified to the
extent necessary to be enforceable, in accordance with the purposes stated in
this Agreement and with applicable law, and all other terms and provisions of
this Agreement shall remain valid and fully enforceable.
5. REMEDIES. Employee acknowledges and agrees with Intuit and Rock that,
in light of Employee's unique skills, experience and capabilities, money damages
would not adequately compensate Intuit or Rock if Employee were to breach any of
covenants of Employee contained in this Agreement. Consequently, Employee agrees
that in the event of any such breach, Intuit and/or Rock shall each be entitled,
in addition to all other remedies, to enforce this Agreement by means of an
injunction, specific performance or other equitable relief.
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6. GOVERNING LAW. The internal laws of the State of Michigan
(irrespective of its choice of law principles) will govern the validity of this
Agreement, the construction of its terms, and the interpretation and enforcement
of the rights and duties of the parties hereto.
7. SUCCESSORS AND ASSIGNS. This Agreement and the rights and obligations
of Employee hereunder are personal to Employee and shall not be assignable,
delegable or transferable by Employee in any respect. This Agreement shall inure
to the benefit of the permitted successors and assigns of Intuit and Rock,
including any successor to or assignee of all or substantially all of the
business and assets of Intuit or Rock or any other part of the business or
assets of Intuit and/or Rock.
8. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which will be an original as regards any party whose
signature appears thereon and all of which together will constitute one and the
same instrument. This Agreement will become binding when one or more
counterparts hereof, individually or taken together, bear the signatures of all
parties reflected hereon as signatories.
9. AMENDMENT; WAIVER. This Agreement may be amended only by the written
agreement of Intuit and Employee. No waiver by any party hereto of any condition
or of any breach of any provision of this Agreement will be effective unless
such waiver is set forth in a writing signed by such party. No waiver by any
party of any such condition or breach, in any one instance, will be deemed to be
a further or continuing waiver of any such condition or breach or a waiver of
any other condition or breach of any other provision contained herein.
10. NOTICES. All notices and other communications required or permitted
under this Agreement will be in writing and will be deemed given (1) when
personally delivered, (2) on the date delivery is made if sent by commercial
delivery service, (3) five business days after being mailed if mailed by
registered or certified mail (postage prepaid, return receipt requested), or (4)
on the date sent if by facsimile, telegraph or telex (receipt confirmed) to the
following addresses or facsimile numbers (or such other addresses or facsimile
numbers as any party may notify the other parties in accordance with this
Section):
If to Intuit or Rock:
If sent by registered or certified mail, to:
Intuit Inc.
Attn: General Counsel
Legal Dept.
P.O. Box 7850
Mountain View, CA 94039-7850
Fax No. (650) 944-6622
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If personally delivered or delivered by commercial delivery service, to:
Intuit Inc.
Attn.: General Counsel
Legal Dept.
2550 Garcia Avenue
Mountain View, CA 94043
Fax No. (650) 944-6622
With a copy to:
Fenwick & West LLP
Two Palo Alto Square, Suite 800
Palo Alto, CA 94306
Attention: Gordon K. Davidson, Esq.
Michael J. Patrick, Esq.
Fax No. (650) 494-1417
If to Employee:
Daniel Gilbert c/o
Rock Financial Corporation
30600 Telegraph Road, Fourth Floor
Bingham Farms, MI 48025
Fax No. (248) 723-7220
With a copy to:
Honigman Miller Schwartz and Cohn
2290 First National Building
Detroit, Michigan 48226-3583
Attention: Alan S. Schwartz and
Robert J. Krueger
Fax No. (313) 465-7575
11. COSTS OF ENFORCEMENT. If any party to this Agreement seeks to
enforce its rights under this Agreement by legal proceedings or otherwise, the
non-prevailing party shall pay all costs and expenses incurred by the prevailing
party, including, without limitation, all reasonable attorneys' and experts'
fees.
12. ENTIRE AGREEMENT. This Agreement contains all of the terms and
conditions agreed upon by the parties relating to the subject matter of this
Agreement and, effective upon the Effective Time of the Merger, shall supersede
any and all prior and contemporaneous agreements, negotiations, correspondence,
understandings and communications of the parties, whether oral or written, with
respect to such subject matter including without limitation, Section 2 of the
letter agreement, dated as of April 10, 1998, between Rock and Employee which is
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terminated effective upon the Effective Time; provided, however, that
notwithstanding the foregoing, any non-competition, non-solicitation or other
covenants of the type set forth in Section 3 of this Agreement that are
contained in any employment agreement or in any employee invention assignment
and/or confidentiality agreement executed by Employee with Intuit or the
Surviving Corporation at any time during the Covenant Period, shall each be
construed to be a separate, independent and concurrent covenant and obligation
of Employee that is cumulative and in addition to, and not in lieu of or in
conflict with, any of the covenants in Section 3 of this Agreement, and the
existence of any such separate, independent and concurrent covenant or covenants
shall have no effect on the covenants contained in Section 3 of this Agreement).
13. RULES OF CONSTRUCTION. This Agreement has been negotiated by the
respective parties hereto and their attorneys and the language hereof will not
be construed for or against either party. Unless otherwise indicated herein, all
references in this Agreement to "Sections" refer to sections of this Agreement.
The titles and headings herein are for reference purposes only and will not in
any manner limit the construction of this Agreement which will be considered as
a whole.
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IN WITNESS WHEREOF, Employee, Intuit and Rock have executed and entered
into this Agreement effective as of the Execution Date.
INTUIT INC. EMPLOYEE
By: /s/ Mark R. Goines /s/ Daniel Gilbert
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Daniel Gilbert
Name: Mark Goines
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Title: Senior Vice President
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ROCK FINANCIAL CORPORATION
By: /s/ Michael D. Hollerbach
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Name: Michael D. Hollerbach
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Title: President
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[SIGNATURE PAGE TO NON-COMPETITION AGREEMENT]