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EXHIBIT 2.2
NONCOMPETITION AGREEMENT
This Noncompetition Agreement (this "Agreement") is made as of
____________, 1998, by and among Packaged Ice, Inc., a Texas corporation
("Purchaser"), and Suiza Foods Corporation, a Delaware corporation ("Seller").
PRELIMINARY STATEMENTS
Seller was the holder of all of the outstanding capital stock of Reddy
Ice Corporation, a Delaware corporation (the "Company"), which was sold to
Purchaser pursuant to that certain Stock Purchase Agreement dated as of March
27, 1998 (the "Stock Purchase Agreement")
Section 3.2(c) of the Stock Purchase Agreement requires that Seller
execute and deliver a noncompetition agreement as a condition to the
consummation of the transactions contemplated by the Stock Purchase Agreement.
AGREEMENT
For valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties, intending to be legally bound, agree as
follows:
1. ACKNOWLEDGMENTS BY SELLER.
Seller understands, acknowledges and agrees that (a) Purchaser has
required that Seller make the covenants set forth in Sections 2 and 3 of this
Agreement as a condition to Purchaser's acquisition of the Company; (b) the
provisions of Sections 2 and 3 of this Agreement are reasonable (including with
respect to duration, geographical area and scope) and do not impose a greater
restraint on Seller than is necessary to protect the goodwill or other business
interest of Purchaser; (c) the provisions set forth in Sections 2 and 3 are not
oppressive to Seller nor injurious to the public; and (d) Purchaser would be
irreparably damaged if Seller were to breach the covenants set forth in
Sections 2 and 3 of this Agreement.
2. CONFIDENTIAL INFORMATION.
Subject to Section 8.3 of the Stock Purchase Agreement, Seller
acknowledges and agrees that all confidential information known or obtained by
Seller, whether before or after the date hereof, relating to the Company is now
the property of Purchaser. Therefore, Seller agrees that it will not, at any
time, disclose to any unauthorized persons or use for its own account or for
the benefit of any third party any such confidential information, without the
prior written consent of Purchaser, unless and to the extent that such
confidential information:
(i) is or becomes generally known to and available for use by the
public, other than as a result of the fault of Seller, including, without
limitation, Seller's officers, directors, employees,
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consultants, agents and investment bankers ("Representatives") or any other
person bound by a duty of confidentiality to Purchaser,
(ii) becomes available to Seller on a non-confidential basis from a
source other than Purchaser, provided that such source is not bound by a
confidentiality agreement or other contractual, legal or fiduciary obligation
of confidentiality to Purchaser, or
(iii) Seller or any of its Representatives are compelled to disclose
by judicial or administrative process or, in the opinion of Seller' counsel, by
other mandatory requirements of law.
Seller agrees to deliver to Purchaser at any time Purchaser may
request, all documents, memoranda, notes, plans, records, reports, and other
documentation, models, components, devices, or computer software, whether
embodied in a disk or in other form (and all copies of all of the foregoing,
excluding Seller's personal copies of the transactional documents related to
the aforementioned Stock Purchase Agreement ), relating to the Company that
Seller may then possess or have under its control. Seller's obligations with
respect to this Section 2 shall terminate five (5) years after the date of this
Agreement.
3. NONCOMPETITION.
As an inducement for Purchaser to enter into and consummate the Stock
Purchase Agreement, and in exchange for the consideration paid to Seller under
the Stock Purchase Agreement, Seller covenants and agrees that:
(a) For a period of five (5) years after the date hereof within a
three hundred (300) mile radius of any packaged, block, agricultural or dry ice
manufacturing or distribution facility of Purchaser, any subsidiary of
Purchaser or Reddy Ice Corporation in existence on the date hereof (the
"Territory"):
(i) Neither Seller nor any of its subsidiaries will
directly or indirectly, engage or invest in, own, manage, operate, finance,
control or participate in the ownership, management, operation, financing or
control of, be employed by, lend Seller's name or any similar name to, lend
Seller's credit to, or render services or advice to, any business whose
products or activities compete in whole or in part with the products or
activities of Purchaser or any of its subsidiaries as it relates to the
production, distribution, transportation, and sale of packaged, block,
agricultural or dry ice products; provided, however, Seller may own not more
than 5% of the outstanding capital stock of a publicly held company engaged in
any such business, and provided further, that Seller may acquire companies in
the Territory with respect to which the production, distribution,
transportation and sale of packaged, block, agricultural or dry ice products is
incidental so long as Seller (a) disposes of such incidental business within
180 days following the acquisition thereof and (b) with respect to such
disposition, provides Purchaser with a right of first refusal to purchase such
incidental business at the same price and on substantially the same terms as
Seller proposes to dispose of such business to any third party, which right
Purchaser may exercise within ten days after receipt of the forms of definitive
documentation for such proposed disposition. If Purchaser so elects to
exercise its right to acquire such business, Purchaser and Seller shall
promptly thereafter enter into definitive agreements for such acquisition
substantially similar to the definitive documentation for the proposed
disposition to the third party;
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(ii) As it relates to the manufacture, distribution and
sale of packaged, block, agricultural or dry ice products by Purchaser or any
of its subsidiaries, neither Seller nor any of its subsidiaries will, directly
or indirectly, either for its own behalf or on behalf of any other person or
entity, solicit the business of any person or entity known to Seller to be a
customer or prospective customer of Purchaser or any of its subsidiaries,
whether or not Seller had personal contact with such customer or prospective
customer of Purchaser or any of its subsidiaries, with respect to products or
activities which compete in whole or in part with the products or activities of
Purchaser or any of its subsidiaries.
(b) For a period of two (2) years after the date hereof, neither
Seller nor any of its subsidiaries will directly or indirectly, for its own
behalf or on behalf of any other person or entity, (i) solicit or attempt to
solicit any employee of Purchaser or any of its subsidiaries or attempt to
encourage any such employee to leave the employ of Purchaser or any of its
subsidiaries, or (ii) induce or attempt to induce any customer, supplier,
licensee, or business relation of Purchaser or any of its subsidiaries to cease
doing business with Purchaser or any of its subsidiaries; and
(c) For a period of two (2) years after the date hereof, neither
Seller nor any of its subsidiaries will, directly or indirectly, for its own
behalf or on behalf of any other person or entity, knowingly employ or
otherwise engage as an employee, independent contractor or otherwise any
employee of Purchaser or any of its subsidiaries.
(d) In the event of a breach by Seller of any covenant set forth
in Subsection 3(a), (b) or (c) of this Agreement, the term of such covenant
will be extended by the period of the duration of such breach.
4. REMEDIES.
If Seller breaches any covenant set forth in Section 2 or 3 of this
Agreement, Purchaser will be entitled to the following remedies:
(a) damages from Seller; and
(b) in addition to its right to damages and any other rights
Purchaser may have, to obtain injunctive or other equitable relief to restrain
any breach or threatened breach or otherwise to specifically enforce the
provisions of Sections 2 and 3 of this Agreement, it being agreed that money
damages alone would be inadequate to compensate Purchaser and would be an
inadequate remedy for such breach.
5. SUCCESSORS AND ASSIGNS.
This Agreement will be binding upon Seller and its assigns, heirs and
legal representatives and will inure to the benefit of Purchaser and its
affiliates, successors and assigns. Neither this Agreement nor any rights or
obligations hereunder shall be assignable by Seller. Purchaser shall have the
right to assign its rights under this Agreement to any entity which acquires
all or substantially all of the assets or stock of Purchaser.
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6. WAIVER.
The rights and remedies of the parties to this Agreement are
cumulative and not alternative. Neither the failure nor any delay by any party
in exercising any right, power, or privilege under this Agreement will operate
as a waiver of such right, power or privilege, and no single or partial
exercise of any such right, power, or privilege will preclude any other or
further exercise of such right, power or privilege or the exercise of any other
right, power or privilege. To the maximum extent permitted by applicable law:
(a) no claim or right arising out of this Agreement can be discharged
by one party, in whole or in part, by a waiver or renunciation of the claim or
right unless in writing and signed by the other party;
(b) no waiver that may be given by a party will be applicable except
in the specific instance for which it is given; and
(c) no notice to or demand on one party will be deemed to be a waiver
of any obligation of such party or of the right of the party giving such notice
or demand to take further action without notice or demand as provided in this
Agreement.
7. GOVERNING LAW.
This Agreement will be governed by the laws of the State of Texas.
8. JURISDICTION.
The parties hereto intend to and hereby confer jurisdiction to enforce
the covenants contained in this Agreement upon the District Court of Dallas
County, Texas.
9. SEVERABILITY.
Whenever possible each provision and term of this Agreement will be
interpreted in a manner to be effective and valid but if any provision or term
of this Agreement is held to be prohibited by law or invalid, then such
provision or term will be ineffective only to the extent of such prohibition or
invalidity, without invalidating or affecting in any manner whatsoever the
remainder of such provision or term or the remaining provisions or terms of
this Agreement. If any of the covenants set forth in this Agreement are held by
a court of competent jurisdiction to contain limitations as to time,
geographical area or scope of activity to be restrained that are not reasonable
and impose a greater restraint than is necessary to protect the goodwill or
other business interest of Purchaser, the court shall reform the covenants to
the extent necessary to cause the limitations contained in the covenants as to
time, geographical area and scope of activity to be restrained to be reasonable
and to impose a restraint that is not greater than necessary to protect the
goodwill or other business interest of Purchaser and enforce the covenants as
reformed.
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10. COUNTERPARTS.
This Agreement may be executed in one or more counterparts, each of
which will be deemed to be an original copy of this Agreement and all of which,
when taken together, will be deemed to constitute one and the same agreement.
11. SECTION HEADINGS, CONSTRUCTION.
The headings of Sections in this Agreement are provided for
convenience only and will not affect its construction or interpretation. All
references to "Section" or "Sections" refer to the corresponding Section or
Sections of this Agreement unless otherwise specified. All words used in this
Agreement will be construed to be of such gender or number as the circumstances
require. Unless otherwise expressly provided, the word "including" does not
limit the preceding words or terms.
12. NOTICES.
All notices, consents, waivers and other communications under this
Agreement must be in writing and will be deemed to have been duly given when:
(a) delivered by hand (with written confirmation of receipt), (b) sent by
facsimile (with written confirmation of receipt), provided that a copy is
mailed by registered mail, return receipt requested, or (c) when received by
the addressee, if sent by a nationally recognized overnight delivery service
(receipt requested), in each case to the appropriate addresses and facsimile
numbers set forth below (or to such other addresses and facsimile numbers as a
party may designate by notice to other parties):
Seller: Suiza Foods Corporation
0000 Xxxxxx Xxxxx Xxxx., Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Xxxxx X. Xxxxxx, Chief Executive Officer
With a copy to: Xxxxxx & Xxxx, L.L.P.
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Xxxxxxx XxXxxxxxx, Esq.
Purchaser: Packaged Ice, Inc.
0000 Xxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: X.X. Xxxxx, President
With a copy to: Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxx 00000
Attention: Xxxx Xxxxxxxxxx, Esq.
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13. ENTIRE AGREEMENT.
This Agreement constitutes the entire agreement between the parties
with respect to the subject matter of this Agreement. This Agreement may not be
amended except by a written agreement executed by the party to be charged with
the amendment.
[NONCOMPETITION AGREEMENT
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[NONCOMPETITION AGREEMENT SIGNATURE PAGE]
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date first above written.
SUIZA FOODS CORPORATION
By:
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Print Name:
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Print Title:
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PACKAGED ICE, INC.
By:
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Print Name:
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Print Title:
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