EXHIBIT 10(S)
NONCOMPETITION AND NONDISCLOSURE AGREEMENT
THIS AGREEMENT ("Agreement") is made and entered into
this 14th day of August, 1995, by and between Sealright Co., Inc.
("Sealright") and Xxxxxxx X. Xxxxx ("Executive").
RECITALS
A. Sealright is engaged in the business of
developing, manufacturing, selling and distributing a variety of
packaging systems and products, including rigid paperboard and
plastic containers, flexible packages, sleeve labels and related
equipment.
B. In connection with its business, Sealright has
expended a great deal of time, money and effort to develop and
maintain the secrecy and confidentiality of substantial
proprietary trade secret information and other confidential
business information which, if misused or disclosed, could be
very harmful to Sealright's business and could cause Sealright to
lose its competitive edge in the marketplace.
C. Executive desires to be employed by Sealright as
its Chief Executive Officer, and to be given access to
confidential and proprietary information of Sealright necessary
for Executive to perform his job.
D. Executive recognizes and acknowledges that if
Executive were to leave Sealright, it would need certain
protection in order prevent Executive from having an unfair
competitive advantage over Sealright.
COVENANTS
NOW THEREFORE, in consideration of the above and of the
mutual covenants and agreements hereinafter set forth, Executive
and Sealright agree as follows:
1. Confidential Information.
(a) Executive agrees to keep secret and
confidential, and not to use or disclose to any third-parties,
except as directly required for Executive to perform Executive's
employment responsibilities for Sealright, any of Sealright's
proprietary trade secret information or other confidential
business information acquired by Executive during the course of,
or in connection with, Executive's employment with Sealright (and
which was not known by Executive prior to Executive's being hired
by Sealright); provided, however, while Executive is employed by
Sealright an inadvertent violation of this covenant or a
violation that does not result in material damage to Sealright
shall not be deemed a breach of this Agreement by Executive.
Sealright considers and treats as confidential, among other
things, its pricing policies, operational methods, human resource
data, strategic plans, internal financial information, research
and development plans and activities, and business acquisition
and expansion plans. Executive agrees to treat such information
as secret and confidential so long as such information does not
become generally known to the public through no fault or wrongful
act of Executive.
(b) Executive acknowledges that any and all
notes, records, computer diskettes and other documents obtained
by or provided to Executive, or otherwise made, produced or
compiled during the course of Executive's employment with
Sealright, which contain any confidential Sealright information,
regardless of the type of medium in which it is preserved, are
the sole and exclusive property of Sealright and shall be
surrendered to Sealright upon the Executive's termination of
employment and on demand at any time by Sealright.
2. Post-Termination Restrictions.
Executive agrees that during Executive's employment
with Sealright and for a period of two (2) years thereafter,
regardless of how Executive's termination occurs and regardless
of whether it is with or without cause, Executive will not, on
Executive's own behalf or on behalf of any other person or entity
in the United States:
(a) provide administrative, financial, sales,
marketing, or management services for any person or entity which
is engaged in the manufacture or sale of any product line which
directly competes with any product line or product lines of
Sealright which represented more than 10 percent of Sealright's
consolidated revenues during the fiscal year immediately
preceding the termination of Executive's employment with
Sealright, or which under Sealright's business plans at the time
of such termination are forecast to represent more than 10
percent of Sealright's consolidated revenues during the fiscal
year in which the termination occurs. Executive recognizes the
broad territorial scope of this covenant, but acknowledges and
agrees that the restriction is reasonable and enforceable in view
of, among other things, (i) the narrow range of activities
prohibited, (ii) the markets in which Sealright's products are
sold, (iii) the confidential information to which Executive has
access, and (iv) Executive's background, which is such that the
restraint will not impose an undue hardship on Executive; or
(b) solicit, induce, employ or seek to employ any
salesperson, engineer, technician, manager or executive-level
employee of Sealright, who was employed by Sealright during
Executive's last six (6) months of employment with Sealright.
3. Acknowledgement Regarding Restrictions. Executive
recognizes and agrees that the restraints contained in Section 2
are reasonable and enforceable in view of Sealright's legitimate
interests in protecting its confidential information and customer
goodwill and the limitations contained therein on the duration
and geographic scope of, and activities prohibited by, such
restraints.
4. Non-Waiver of Rights. Sealright's failure to
enforce at any time any of the provisions of this Agreement or to
require at any time performance by the Executive of any of the
provisions hereof shall in no way be construed to be a waiver of
such provisions or to affect either the validity of this
Agreement or the right of Sealright thereafter to enforce each
and every provision in accordance with the terms of this
Agreement.
5. Sealright's Right to Injunctive Relief. In the
event of a breach or threatened breach of any of Executive's
duties and obligations under the terms and provisions of Sections
1 or 2 hereof, Sealright shall be entitled, in addition to any
other legal or equitable remedies it may have in connection
therewith (including any right to damages that it may suffer), to
temporary, preliminary and permanent injunctive relief
restraining such breach or threatened breach. Executive hereby
expressly acknowledges that the harm which might result to
Sealright's business as a result of any noncompliance by
Executive with any of the provisions of Sections 1 or 2 would be
largely irreparable.
6. Invalidity of Provisions. In the event that any
provision of this Agreement is adjudicated to be invalid or
unenforceable under applicable law in any jurisdiction, the
validity or enforceability of the remaining provisions thereof
shall be unaffected as to such jurisdiction and such adjudication
shall not affect the validity or enforceability of such provision
in any other jurisdiction. To the extent that any provision of
this Agreement is adjudicated to be invalid or unenforceable
because it is overbroad, that provision shall not be void but
rather shall be limited to the extent required by applicable law
and enforced as so limited. The parties expressly acknowledge
and agree that this Section is reasonable in view of the parties'
respective interests.
7. Assignment. This Agreement shall be freely
assignable by Sealright to and shall inure to the benefit of, and
be binding upon, any successor entity to Sealright; provided,
however, that the restrictions in Section 2(a) shall not apply in
the event of a change of control of Sealright, as defined in the
Stock Option Agreement between Sealright and Executive.
8. Choice of Forum and Governing Law. In light of
Sealright's and the Executive's substantial contacts with the
State of Kansas and significant interest in ensuring that
disputes as to the validity and enforceability of this Agreement
are resolved on a uniform basis, the parties agree that any
litigation involving any noncompliance with or alleged breach of
this Agreement shall be filed and conducted in the State of
Kansas, and that this Agreement shall be interpreted in
accordance with and governed by the laws of the State of Kansas.
9. Amendments. No modification, amendment or waiver
of any of the provisions of this Agreement shall be effective
unless in writing and signed by the parties hereto. This
Agreement supersedes all prior agreements and understandings
between Executive and Sealright to the extent that any such
agreements or understandings conflict with the terms of this
Agreement.
10. Headings. Section headings are provided in this
Agreement for convenience only and shall not be deemed to
substantively alter the content of such sections.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the day and year first above
written.
SEALRIGHT CO., INC.
By: /s/ Xxxx X. Xxxxxx 8-21-95
Xxxx X. Xxxxxx
Chief Financial Officer
/s/ Xxxxxxx X. Xxxxx 8-21-95
Xxxxxxx X. Xxxxx
