Exhibit 10.29
COVENANT NOT-TO-COMPETE AGREEMENT
THIS COVENANT NOT-TO-COMPETE AGREEMENT, dated August 13, 1996, is made
between Payco American Corporation, a Wisconsin corporation, with offices at 000
Xxxxx Xxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxxxx, 00000-0000, (the "Company"), and
Xxxxxx X. Xxxxxxxx, an individual residing in the State of Colorado
("Xxxxxxxx").
R E C I T A L S
WHEREAS OSI Holdings Corp., Boxer Acquisition Corp. and the Company
have entered into an Agreement and Plan of Merger, dated as of the date hereof
(the "Merger Agreement"), pursuant to which Boxer Acquisition Corp. will be
merged with and into the Company;
WHEREAS, Xxxxxxxx has been and is presently serving as a employee of
the Company; and
WHEREAS, Xxxxxxxx possesses knowledge of the business and affairs of
the Company and its policies, procedures, methods and personnel.
NOW, THEREFORE, the parties hereto hereby agrees as follows:
1. Covenant Not-to-Compete. (a) Xxxxxxxx covenants and agrees that he
will not:
(i) for a period of three (3) years from the Effective Time (as
defined in the Merger Agreement), within any jurisdiction or marketing area
in which the Company or any of its Affiliates (as defined below) is doing
business or is qualified to do business, directly or indirectly own,
manage, operate, control, be employed by or participate in the ownership,
management, operation or control of, or be connected in any manner with,
any business of the type and character engaged in and competitive with that
currently conducted by the Company or any of its Affiliates. For these
purposes, ownership of securities of 5% or less of any class of securities
of a public company shall not be considered
to be competition with the Company or any of its Affiliates; or
(ii) employ, solicit for employment or otherwise contract for the
services of any employee of the Company or any of its Affiliates at the
time of this Agreement, or who shall subsequently become an employee of the
Company or any of its Affiliates.
(b) For the purposes of this Section 1, the term "Affiliate" shall
mean, with respect to the Company, any person or entity which, directly or
indirectly, owns or is owned by, or is under common ownership with, the Company.
The term "own" (including, with correlative meanings, "owned by" and "under
common ownership with") shall mean the ownership of 50% or more of the voting
securities (or their equivalent) of a particular entity.
2. Effectiveness; Consideration for Covenant. This Agreement shall
become effective at the Effective Time. In consideration for Xxxxxxxx'x entering
into the foregoing covenant, the Company will pay to Xxxxxxxx $200,000 at the
Effective Time.
3. Severability. It is the desire and intent of the parties to this
Agreement that the provisions of Section 1 shall be enforced to the fullest
extent permissible under the laws and public policies applied in each
jurisdiction in which enforcement is sought. If any particular provision or
portion of Section 1 shall be adjudicated to be invalid or unenforceable,
Section 1 shall be deemed amended to delete therefrom such provision or portion
adjudicated to be invalid or unenforceable, such amendment to apply only with
respect to the operation of Section 1 in the particular jurisdiction in which
such adjudication is made.
4. General.
(a) Governing Law; Jurisdiction. The validity, interpretation,
construction and performance of this Agreement shall be governed by the laws of
the State of New York applicable to contracts executed and to be performed
entirely within said State. Any judicial proceeding brought against any of the
parties to this Agreement or any dispute arising out of this Agreement or any
matter related hereto may be brought in the courts of the State of New York or
in the United States District Court for the Southern District of New York, and,
by execution and delivery of this Agreement, each of the parties to this
Agreement accepts the
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jurisdiction of said courts, and irrevocably agrees to be bound by any judgment
rendered thereby in connection with this Agreement. The foregoing consent to
jurisdiction shall not be deemed to confer rights on any person other than the
respective parties to this Agreement.
(b) Assignability. Notwithstanding anything else in this Agreement to
the contrary, the Company may assign this Agreement to and all rights hereunder
shall inure to the benefit of any person, firm or corporation succeeding to all
or substantially all of the business or assets of the Company by purchase,
merger or consolidation.
(c) Enforcement Costs. In the event that either the Company or
Xxxxxxxx initiates an action or claim to enforce any provision or term of this
Agreement, the costs and expenses (including attorney's fees) of the prevailing
party shall be paid by the other party, such party to be deemed to have
prevailed if such action or claim is concluded pursuant to a court order or
final judgment which is not subject to appeal, a settlement agreement or
dismissal of the principle claims.
(d) Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the Company and its successors and assigns.
(e) Entire Agreement; Modification. This Agreement constitutes the
entire agreement of the parties hereto with respect to the subject matter hereof
and may not be modified or amended in any way except in writing by the parties
hereto.
(f) Duration. This Agreement shall continue for so long as any
obligations remain under this Agreement.
(g) Survival. The covenants set forth in Section 1 of this Agreement
shall survive and shall continue to be binding upon Xxxxxxxx as set forth in
such Section. The existence of any claim or cause of action by Xxxxxxxx against
Company, whether predicated on this Agreement or otherwise, shall not constitute
a defense to the enforcement by Company of any or all covenants.
(h) Remedies. The parties recognize that the performance of the
obligations under Section 1 of this Agreement by Xxxxxxxx is special, unique and
extraordinary in character, and that in the event of the breach by Xxxxxxxx of
the terms and conditions of Section 1 of this Agreement, the
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Company or any of its Affiliates shall be entitled to (a) institute and
prosecute proceedings in any court of competent jurisdiction to enforce the
specific performance hereof by Xxxxxxxx or to enjoin Xxxxxxxx from engaging in
any activities prohibited hereunder or (b) pursue any other remedy available at
law or in equity.
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IN WITNESS WHEREOF, the parties hereto, intending to be legally bound,
have hereunto executed this Agreement the day and year first written above.
PAYCO AMERICAN CORPORATION
By: /s/ Xxxxxx X. Punches
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Name: Xxxxxx X. Punches
Title: Chairman
/s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx
