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EXHIBIT 10.2
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CONFIDENTIALITY AND
NON-COMPETE AGREEMENT
AGREEMENT is made this 11th day of November, 1996, between STUDIO PLUS
HOTELS, INC., a Virginia corporation with its principal office at 1999 Richmond
Road, Suite 4, Lexington, Kentucky, on behalf of itself and its predecessors,
affiliates and subsidiaries (including Studio Plus Properties, Inc.)
previously, now or hereafter existing (collectively referred to herein as the
"Company") and CREIGHTON SCHNECK (the "Employee") of the Company.
WHEREAS, the Employee has access to and uses in his employment with the
Company valuable proprietary information of the Company, which the Company
desires to continue to protect; and
WHEREAS, the Company wants to protect its proprietary information, competitive
advantage and the investment it has made in Employee;
IN CONSIDERATION of Company granting Employee a Stock Option for Company's
common stock on the terms in the Stock Option Agreement dated the date hereof,
and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, IT IS AGREED:
1. The Employee acknowledges that he has access to proprietary information
developed by the Company with respect to the development, construction,
operation, marketing and administration of the Company's extended stay lodging
business and properties, information that the Company has furnished and is
furnishing to Employee, as well as all information generated by Employee that
contains, reflects or is derived from the furnished information, including, but
not limited to, the items in paragraph 6 hereof (the "Confidential
Information")
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and the Employee hereby acknowledges that the Confidential Information
represents a valuable, special and unique asset of the Company's business. The
Employee agrees that he will not, either during or after the term of his
employment with the Company (the "Term"), disclose the Confidential
Information, or any portion thereof, whether furnished before or after the date
of this Agreement, whether tangible or intangible, and in whatever form or
medium provided, to any person, firm, corporation, association or other entity
for any reason or purpose whatsoever, except with respect to performance of his
duties as an employee of the Company or as may be required by applicable law
and then only after ten (10) days written notice to the Company. Employee's
duty to keep the Confidential Information confidential shall continue for two
(2) years after termination of his employment for any reason unless the
Confidential Information becomes public knowledge sooner through no fault of
Employee.
2. During the Employee's employment and for a period of twelve (12) months
following the Employee's resignation or termination of his employment, the
Employee shall not serve as an officer, director, trustee, member, consultant,
advisor, employee, agent or in any other capacity or as an owner, shareholder
or partner, in any corporation, partnership, sole proprietorship, joint
venture, trust, limited liability company or any other entity engaged in
managing, developing, constructing, operating or owning any interest in, any
extended stay hotel located within a Metropolitan Statistical Area (MSA) in
which a Studio Plus hotel is operating, under construction or a contract or
lease has been executed to acquire land on which to develop a Studio Plus hotel
as of the day on which Employee's employment terminates. An extended stay hotel
for the purposes of this Agreement shall mean a hotel composed of a hotel suite
room rented predominantly by the week or for stays of more than three (3) days,
with each suite containing a kitchen with at least a refrigerator, a range top
burner unit and a microwave or radiant heat oven and rented at a price per
night within a range fifteen percent (15%) above and fifteen percent (15%)
below the average weekly rate of the Studio Plus hotel
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chain at that time. An MSA shall be determined by the latest edition of "County
& City Extra" published by Bernan Press, Lanham, Maryland in existence at the
time of Employee's termination.
3. The Employee agrees that damages at law for violation of the restrictive
covenants contained in this Agreement would not be an adequate or prior remedy
to the Company, and that should the Employee violate or threaten to violate any
of the provisions of such covenants, the Company, its successors or assigns,
shall be entitled to obtain a temporary or permanent injunction against the
Employee in any court having personal and subject matter jurisdiction,
prohibiting any violation of such covenants. The injunctive relief provided
herein shall be in addition to any award of damages, compensatory, exemplary or
otherwise, payable by reason of such violation. The running of the term of the
noncompetition period shall be extended day for day for any period during which
the Employee is in breach of the covenants and agreements contained herein for
any reason whatsoever. The Employee further agrees that the Company need not
post any bond or prove actual damage in connection with seeking to obtain
injunctive relief.
4. The Employee acknowledges that this Agreement has been negotiated at arm's
length by the parties, neither being under any compulsion to enter into this
Agreement, and that the foregoing restrictive covenant does not in any respect
inhibit his ability to earn a livelihood in his chosen profession without
violating the restrictive covenants contained herein. The Company, by these
presents, has attempted to limit the Employee's right to compete only to the
extent necessary to protect the Company from unfair competition. The Company
recognizes, however, that reasonable people may differ in making such a
determination. Consequently, the parties agree that if a court of competent
jurisdiction will not enforce the noncompetition covenant in Paragraph 2 hereof
as written, then the court or other trier of fact may modify the covenant to
the least extent where it will be enforceable and to enforce the covenant as
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modified to the maximum extent that it believes to be reasonable under the
circumstances existing at the time.
5. All inventions, discoveries, improvements, whether patentable or
unpatentable, made, devised, or discovered by the Employee, whether by Employee
singly or jointly with others, from the time of entering the Company's employ
until termination of his employment, relating or pertaining in any way to his
employment or the business of the Company, shall be promptly disclosed in
writing to the President of the Company (or such other officer as the President
may designate) and are to accrue to the benefit of the Company and become and
remain its sole and exclusive property. Any original or derivative works of
authorship, whether copyrightable or uncopyrightable, including, without
limitation, plans, specifications, booklets, manuals, procedures, computer
programs, and the like, created by the Employee within the scope of his
employment with the Company shall be and remain the Company's sole and
exclusive property. The Employee agrees, at the Company's request and cost, to
execute any assignments to the Company or its nominee, of his entire right,
title, and interest in and to any such inventions, discoveries, improvements
and works of authorship and to execute any other instruments and documents
requisite or desirable in applying for and obtaining patents or copyrights with
respect thereto in the United States and in all foreign countries. The Employee
further agrees, whether or not in the employ of the Company, to cooperate to
the extent and in the manner requested by the Company in the prosecution or
defense of any patent and/or copyright claims or any litigation or other
proceeding involving any inventions, trade secrets, processes, discoveries,
methods or works covered by this Agreement, but all expense thereof shall be
paid by the Company.
6. All records, files, software, memoranda, reports, price lists, customer
lists, manuals, drawings, plans, sketches, procedures, documents, equipment,
and the like, relating to the business of the Company which the Employee shall
use or prepare or come into contact with
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during his employment with the Company, shall be and remain the sole property
of the Company and the Employee shall promptly deliver to the Company at the
termination of his employment, or at any time on the Company's request, without
retaining copies, any or all of such items which have been loaned or disclosed
to, or otherwise obtained by, Employee.
7. This Agreement may not be changed or terminated orally, and no change,
termination, or attempted waiver of any of the provisions hereof shall be
binding unless in writing and signed by both the Employee and the Chairman of
the Board and Chief Executive Officer of the Company or the President of the
Company. The Employee's compensation, position or capacity may be changed at
any time by the Company, or his employment terminated at any time, without in
any way affecting any of the terms and conditions of this Agreement, which in
all respects shall remain in full force and effect, and without incurring any
liability to the Employee.
8. This Agreement shall be governed by the laws of the Commonwealth of
Kentucky. The invalidity of any provision hereof shall not invalidate any other
provision hereof.
9. This Agreement shall be binding on and shall inure to the heirs,
successors and assigns of the parties hereto.
10. All of the terms and words used in this Agreement, regardless of the
gender used, shall be deemed and construed to include any other gender
(masculine, feminine or neuter) as the context or sense of the Agreement or any
paragraph or clause hereof may require, or as required by the sex of the
Employee executing the Agreement, the same as if such words had been fully and
properly written in the appropriate gender.
IN WITNESS WHEREOF, the parties have executed this Agreement the day and year
first above written.
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ATTEST: STUDIO PLUS HOTELS, INC.
/s/ William Anderson By: /s/ Norwood Cowgill, Jr.
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Title: Chief Executive Officer
WITNESS:
/s/ William Anderson /s/ Creighton Schneck
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Creighton Schneck
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