Exhibit 10.2
NON-COMPETITION AGREEMENT
This Non-Competition Agreement (the "Agreement"), dated as of March 16,
2007, is between BCP Ingredients, Inc., a Delaware corporation, (the "Buyer"),
Chinook Global Limited, an Ontario corporation, Chinook Services, L.L.C., a
Delaware limited liability company, and Chinook, L.L.C., a Delaware limited
liability company, (collectively the "Seller"), Xxxx X. Xxxx, a resident of the
state of Louisiana, Xxxxxx X. Xxxxx, a resident of the province of Ontario, and
Xxxx X. Xxxxxxx, a resident of the state of Minnesota (each a "Shareholder," and
collectively the "Shareholders").
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Background Statement
The Buyer and the Seller are parties to an Asset Purchase Agreement dated
as of the date hereof (the "Purchase Agreement") pursuant to which Seller agreed
to sell, and Buyer agreed to purchase from Seller certain assets of Seller used
in Seller's business of developing, producing, manufacturing, marketing,
distributing or selling choline chloride and specialty choline derivatives (the
"Business"). The Shareholders, through Chinook Xxxx, Inc.; Chinook Xxxxxxx,
Inc.; and 2097299 Ontario Limited, own all of the outstanding capital stock of
the Seller. Immediately following the closing of the transactions contemplated
by the Purchase Agreement, the Buyer will be engaged in the Business.
The entering into of this Agreement by the Seller and the Shareholders is
a condition precedent to the closing of the transactions contemplated by the
Purchase Agreement.
Statement of Agreement
The parties agree as follows:
1. Definitions. The capitalized terms used in this Agreement and not
otherwise defined have the meanings set forth in the Purchase Agreement.
2. Non-competition. As an inducement for the Buyer to enter into the
Purchase Agreement and in consideration for the Buyer's consummation of the
transactions contemplated hereby, the Seller and each Shareholder agree that:
(a) For a period of ten (10) years following the Closing Date (the
"Term"), neither the Seller nor any Shareholder nor any of their Affiliates
shall, directly or indirectly, engage or invest in, or own, manage, operate,
finance, control or participate in the ownership, management, operation,
financing or control of any Person engaged in, the Business (each, a
"Competitor"), in each case in the following geographic areas: the United
States, Canada, North America and the world; provided, however, that the
Shareholders and the Seller, together with such Persons' Affiliates, in the
aggregate, may purchase or otherwise acquire up to (but not more than) 5% of any
class of securities of any enterprise (but without otherwise participating in
the activities of such enterprise) if such securities are listed on any national
or regional securities exchange or have been registered under Section 12(g) of
the Securities Exchange Act of 1934, as amended;
provided further, however, that a Shareholder may be employed by a Competitor in
an area or unit of the Competitor's business whose products, services, or
activities do not compete with the Business; provided further, however, that the
Seller and the Shareholders may engage in the Business to the extent necessary
to comply with the terms of, and fulfill the Seller's obligations under, any
sales agreement or supply agreement in effect, or purchase order outstanding, as
of the Closing Date that is not assumed by the Buyer.
(b) The parties agree that none of the provisions of this section apply to
the activities contemplated in the Tolling Agreement.
(c) Each Shareholder shall, within ten days after accepting any
employment, consulting engagement, engagement as an independent contractor,
partnership or other association with a Competitor during the Term, advise such
Competitor that such Shareholder is bound by this Agreement.
(d) If any provision or part of Section 2 is unenforceable because of its
duration or its geographic coverage, or because it is too expansive in any other
respect, the parties hereto agree to modify this Section 2, and that the court
making such determination shall have the power to interpret and modify this
Section 2, to reduce the duration, the geographic coverage, or such other
provision and to delete specific words or phrases herefrom ("blue-penciling"),
so that this Section 2 shall extend over the longest time, the largest
geographic area and in any other respect as is enforceable under applicable law
and, in its reduced or blue-penciled form, such provision shall then be
enforceable and shall be enforced.
3. Reasonable Restraint. The Seller and each Shareholder acknowledge that
(i) the Business is international in scope; (ii) the products and services
related to the Business are marketed throughout the world; (iii) the Business
competes with other businesses that are or could be located in any part of the
world; (iv) the Buyer has required that the Seller and each Shareholder make the
covenants set forth in this Agreement as a condition to the Buyer's consummation
of the transactions contemplated by the Purchase Agreement and would not
otherwise consummate such transactions; (v) the provisions of this Agreement
impose a reasonable restraint on the Seller and are necessary to protect and
preserve the Buyer's interests in and right to the use of the assets of the
Business and the operation of the Businesses from and after Closing; (vi) the
Shareholders, as equity owners of the Seller, will benefit from the consummation
of the transactions contemplated by the Purchase Agreement; and (vii) the Buyer
would be irreparably damaged if the Seller or any Shareholder were to breach the
covenants set forth in Section 2 of this Agreement.
4. Injunctive Relief and Additional Remedy. The Seller and each
Shareholder acknowledge that the injury that would be suffered by the Buyer as a
result of a breach of the provisions of this Agreement (including any provision
of Section 2) would be irreparable and that an award of monetary damages alone
to the Buyer for such a breach would be an inadequate remedy. The Buyer shall
have the right, in addition to any other rights it may have, to obtain
injunctive relief to restrain any breach or threatened breach or otherwise to
specifically enforce any provision of this Agreement, and the Buyer shall not be
obligated to prove actual damages or post bond or other security in seeking such
relief.
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5. Independent Agreement. Without limiting any party's equitable rights,
remedies or defenses, to the extent available under applicable law, the
existence of any claim or cause of action of the Seller, any Shareholder or
their respective Affiliates against the Buyer or its Affiliates, whether
predicated on the Purchase Agreement or otherwise, shall not constitute a
defense to the enforcement by the Buyer or its Affiliates of this Agreement.
6. Amendment and Modification. This Agreement may be amended, modified or
supplemented only by an agreement in writing signed by the party against whom
such amendment, modification or supplement is sought to be enforced. Any such
writing must refer specifically to this Agreement.
7. Assignment; No Third-Party Rights. This Agreement and all of the
provisions hereof shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and permitted assigns, but neither this
Agreement nor any of the rights, interests or obligations hereunder shall be
assigned by any party hereto without the prior written consent of the other
party. This Agreement and its provisions are for the sole benefit of the parties
to this Agreement and their successors and permitted assigns and shall not give
any other Person any legal or equitable right, remedy or claim.
8. Governing Law. The execution, interpretation and performance of this
Agreement shall be governed by the internal laws and judicial decisions of the
State of Delaware, without regard to principles of conflicts of laws.
9. Jurisdiction. All issues of jurisdiction and service of process for
lawsuits and other proceedings relating to this Agreement shall be governed by
the provisions of Section 7.8 of the Purchase Agreement.
10. Counterparts. This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument. This Agreement may be executed on
signature pages exchanged by facsimile, in which event each party shall promptly
deliver to the others such number of original executed copies as the others may
reasonably request
[Signatures appear on following page.]
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IN WITNESS WHEREOF, the parties hereto have executed this Non-Competition
Agreement as of the date first above written.
BCP INGREDIENTS, INC.
By: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
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Title: President
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CHINOOK GLOBAL LIMITED
By: /s/ Xxxxxx Xxxxx
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Name: Xxxxxx Xxxxx
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Title: CFO
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CHINOOK SERVICES, L.L.C.
By: /s/ Xxxxxx Xxxxx
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Name: Xxxxxx Xxxxx
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Title: Director/Secretary
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CHINOOK, L.L.C.
By: /s/ Xxxxxx Xxxxx
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Name: Xxxxxx Xxxxx
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Title: Director/Secretary
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SHAREHOLDERS:
/s/ Xxxx X. Xxxx
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Xxxx X. Xxxx
/s/ Xxxxxx Xxxxx
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Xxxxxx X. Xxxxx
/s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx
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