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EXHIBIT 10.13
CONFIDENTIALITY AND NONCOMPETITION AGREEMENT
THIS CONFIDENTIALITY AND NONCOMPETITION AGREEMENT (the "Agreement") is
made as of September 5, 1997, by and between Xxxxx Xxxxx ("Employee") and
Denali Holdings, Inc., a Texas corporation and its affiliates as hereinafter
defined (collectively referred to as the "Company").
W I T N E S S E T H:
WHEREAS, Denali Holdings, Inc. is the parent of a consolidated group
of corporations including 3DM, Inc., Containment Solutions, Inc., Fluid
Containment, Inc., Xxxxxx Containment, Inc., Specialty Solutions, Inc.,
Ershigs, Inc., and Fluid Containment Property, Inc., each of which maintains
its own trade secrets and confidential information as hereinafter described and
each of which are an integral part of the business of the consolidated group as
hereinafter described, and, accordingly, each of which, together with any other
entities hereinafter created or acquired as a part of the consolidated group
shall be jointly referred to as the "Company"; and
WHEREAS, Employee is an executive officer of the Company; and
WHEREAS, because of, among other matters, Employee's intimate
knowledge of the business of the Company and their respective Trade Secrets and
Confidential Information, and her reputation and relationships with, among
others, the clients, customers, subcontractors, suppliers, employees and other
agents of the Company, Employee and the Company recognize and acknowledge (i)
the detrimental effect on the business and the substantially decreased value of
the Company and the business which would result if Employee were to disclose or
use any of the Company's trade secrets or confidential information or to enter
into competition with the business within a reasonable period of time after
Employees' termination of service with the Company and (ii) that the agreements
and covenants in this Agreement are essential to protect the business of the
Company and (iii) that Employee is receiving compensation commensurate with a
position of executive responsibility to the Company.
NOW, THEREFORE, for and in consideration of the mutual promises,
covenants, and obligations contained herein and in consideration of the
employment of Employee by Company, Company and Employee agree as follows:
1. Employee agrees and acknowledges that she is intimately
familiar with the business of the Company, including without limitation, its
Trade Secrets and Confidential Information. As used herein. "Trade Secrets and
Confidential Information" includes without limitation the following: its
plans, strategies, costs, prices, sources of supply, customers and customer
information, formulas, methods, processes, computer software, products and
product manufacturing techniques, financial information, blueprints, technical
data, and the like which are not generally made available. Employee shall
maintain all such Trade Secrets and Confidential Information in strict
confidence and shall not use or disclose any of same except to the extent
reasonably necessary for Employee to perform her employment obligations to the
Company.
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2. Employee agrees that commencing on the date of this Agreement
and continuing for a period of one year from termination of employment,
Employee will not directly or indirectly engage in any Competitive Activities
(as hereinafter defined). The term "Competitive Activities" as used herein
shall mean:
(a) directly or indirectly engaging in, continuing in or
carrying on the business or operations previously conducted by Company
(including without limitation the business of providing economically
and environmentally better solutions for containing, monitoring and
separating critical fluids) as of the date of this Agreement (the
"Business"), including owning, controlling, participating in, joining,
operating, or managing or being a partner, stockholder, member or
owner of any business which competes with the Company in the Business;
(b) consulting with, advising or assisting in any way,
whether or not for consideration, any corporation, partnership, firm
or other business organization regarding the Business which at the
time of such consultation, advice or assistance is or proposes to
become a competitor of the Business, including, but not limited to,
advertising or otherwise endorsing the products or services of any
such competitor that is competing with the Company; soliciting clients
or customers of the Business for services or products competitive with
the Business (or persons or entities from which the Company have
solicited orders for the sale of any Business service within the three
years immediately preceding the date of this Agreement) or otherwise
serving as an intermediary for any such competitor for services or
products competitive with the Business; loaning money or rendering any
other form of financial assistance to any such competitor;
(c) inducing or attempting to induce any director,
officer, employee, agent, or customer, supplier or lessor of the
Company to terminate such position or relationship with the Company or
its subsidiaries; or
(d) operating any business or offering any goods or
services under any name that incorporates the word "Containment" or
xxxx that is similar to any name or xxxx of the Company, or any
variation of the marks;
provided, however, that the term "Competitive Activities" shall not include (i)
the ownership of securities of corporations which are listed on a national
securities exchange or traded in the national over-the-counter market in an
amount which shall not exceed 5% of the outstanding shares of any such
corporation or (ii) any activities performed by Employee on behalf of the
Company. The parties agree that, since the scope of the Business conducted by
or through the Company and its affiliates and subsidiaries, is carried out
through-out the United States.
3. If Employee commits a breach, or overtly threatens to commit a
breach, of any of the provisions of Paragraphs 1 or 2, Company shall have the
right and remedy to have the provisions of Paragraphs 1 or 2 of this Agreement
specifically enforced by any court having jurisdiction, it being acknowledged
and agreed that any such breach or threatened breach will cause irreparable
injury and continuing damage to Company, and that the exact amount of which
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would be difficult to ascertain and that in any event money damages will not
provide an adequate remedy and Company shall be entitled to injunctive relief
restraining any violation of Paragraphs 1 and 2.
The rights and remedies enumerated above shall be independent, and in
addition to, and not in lieu of, any other rights and remedies available to
Company, at law or in equity.
The provisions of this Section 3 will not be subject to arbitration as
set forth in Section 13.
4. The parties hereto intend to and hereby confer jurisdiction to
enforce the covenants contained in Paragraph 1 upon the courts of any state or
foreign jurisdiction within the geographical scope of such covenants. If the
courts of any one or more of such states or jurisdictions shall fail to hold
such covenants wholly enforceable by reason of the breadth of such scope or
otherwise, it is the intention of the parties hereto that such determination
not bar or in any way affect Company's right to the relief provided above in
the courts of any other states or jurisdictions within the geographical scope
of such covenants, as to breaches of such covenants as they relate to each
state being, for this purpose, severable at Company's sole option into diverse
and independent covenants.
5. If any action, suit or other proceedings at law or in equity
is brought to enforce the covenants contained in Paragraphs 1 or 2, or to
obtain money damages for the breach thereof, and such action results in the
award of a judgment for money damages or in the granting of any injunction in
favor of Company, all expenses (including reasonable attorneys' fees and
expenses) of Company, in such action, suit or other proceeding shall (on demand
of Company) be paid by Employee; provided, that, if in any such action, suit or
proceeding, Employee is the prevailing party, then Company shall, upon demand,
pay all expenses (including reasonable attorneys' fees) incurred by Employee in
connection therewith.
6. Employee understands that the foregoing restrictions may limit
her ability to engage in a business similar to the Business, but acknowledges
that she is receiving sufficiently high benefits from Company to justify such
restriction. It is expressly understood and agreed that Employee and Company
consider the restrictions contained in this Agreement to be reasonable and
necessary for the purposes of preserving and protecting the Trade Secrets and
Confidential Information of Company. Based upon the nature of the business in
which the Company is engaged, including the geographic scope of its operations
and the general nature of the industry, the restrictions placed on Employee as
to duration of this Agreement, the geographic scope of the covenants, and the
scope of activity restrictions are reasonable and necessary for the purpose of
preserving and protecting the Trade Secrets and Confidential Information of
Company. The restrictions are drawn as narrowly as possible so as to minimize
the burden on Employee while maintaining protection of Company's legitimate
interests in trade secrets, good will, reputation and protection of customer
base. Employee acknowledges that the restrictions contained in this Agreement
are reasonable. Furthermore, Employee represents and warrants that Employee is
capable of compliance with the restrictions and that the restrictions will not
unreasonably harm or interfere with Employee's ability to earn a living.
Nevertheless,
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if any of the aforesaid restrictions are found by a court having jurisdiction
to be unreasonable, or over broad, as to the scope of activity to be
restrained, geographic area or time, or otherwise unenforceable, the parties
intend for the restrictions therein set forth to be modified by such court so
as to be reasonable and enforceable and as so modified by the court to be fully
enforced.
7. No failure by either party hereto at any time to give notice
of any breach by the other party of, or to require compliance with, any
condition or provision of this Agreement shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent
time.
8. Neither this Agreement nor any interest herein may be assigned
by Employee. Company may freely assign this Agreement and any and all interest
herein to any "Affiliate" thereof or in connection with a transfer, directly or
indirectly, of all or substantially all of its interest in the Company and its
subsidiaries or the assets or business thereof but may not otherwise assign
this Agreement. "Affiliate" means for any Person, (i) any other Person that
directly or indirectly through one or more intermediaries controls, or is under
common control with, or is controlled by, such Person, and (ii) any other
Person owning beneficially or controlling ten percent (10%) or more of the
equity interests in such Persons. As used in this definition, "control" means
the power, directly or indirectly, to direct or cause the direction of
management or policies of a Person (through ownership of voting securities or
other equity interest, by contract or otherwise). "Person" means an
individual, partnership, corporation, limited liability company, association,
trust, unincorporated organization or any other entity or organization
including a government or any agency or political subdivision thereof.
9. If any portion of this Agreement or the application thereof to
any person or circumstance is held invalid or unenforceable to any extent, the
remainder of this Agreement and the application of that provision to other
persons or circumstances is not affected thereby and that provision shall be
enforced to the greatest extent permitted by applicable law.
10. No modification or amendment of any provisions of this
Agreement shall be effective, unless such modification or amendment shall be in
writing and signed by a duly authorized officer of Company and by Employee.
This Agreement may be executed by the parties hereto in one or more
counterparts, each of which shall be an original and all of which shall
together constitute the Agreement. This Agreement constitutes the sole and
entire agreement of the parties hereto with respect to the matters covered
hereby and supersedes all prior negotiations and written, oral or implied
representations, warranties, commitments, offers, contracts and understandings
between the parties with respect to such matters.
11. All notices, demands, consents or other communications
required or permitted hereunder shall be in writing (which shall include
materials sent and received via facsimile) and shall be deemed to have been
given when personally delivered, sent by facsimile or sent by registered or
certified mail, return receipt requested, postage prepaid, addressed as
follows:
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If to Company: Denali Holdings, Inc.
0000 Xxxx Xxx Xxxx., Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
Attention: Ms. Xxxxx Xxxxx
If to Employee: at the address shown on the signature page
of this Agreement
or to such other person and place as a party shall furnish by notice to the
other party hereto if given in the manner required above. Any notice, demand,
consent or other communication given hereunder in the manner required above
shall be deemed to have been effected and received as of the date hand
delivered or, if mailed, three days after the date so mailed.
12. The laws of the State of Texas will govern the interpretation,
validity and effect of this Agreement without regard to the place of execution
or the place for performance thereof.
13. Except for the matters set forth in Section 3 and the rights
and remedies granted to Company in Section 4 which will not be subject to this
Section 13, any controversy or claim arising out of or relating to this
Agreement or any breach thereof, any transaction covered hereby, the subject
matter related hereto or the enforceability hereof, whether based in whole or
in part or written or oral communications, and including but not limited to,
any claims based in whole or in part on negligence, fraud or similar statutes,
laws or regulations, shall be resolved by binding arbitration in accordance
with the provisions of this Section 13.
(i) Except as provided herein to the contrary, the arbitration
shall be conducted in accordance with the then applicable Commercial
Arbitration Rules of the American Arbitration Association. Judgment upon any
award rendered by the arbitrator may be entered and a confirmation order sought
in any court having jurisdiction thereof; provided, however, that the
arbitrator shall have no power to make any award of or for punitive damages nor
shall the arbitrator amend, supplement or reform in any regard any of the
rights, remedies or obligations of any party hereunder, or the enforceability
of any of the terms hereof. All statutes of limitation that would otherwise be
applicable shall apply to any arbitration proceeding. Any attorney-client
privilege and other protection against disclosure of privileged or confidential
information including, without limitation, any protection afforded the
work-product of any attorney, that could otherwise be claimed by any party
shall be available to, and may be claimed by, any such party in any arbitration
proceeding. No party waives any attorney-client privilege or any other
protection against disclosure of privileged or confidential information by
reason of anything contained in, or done pursuant to, the arbitration
provisions of this Agreement. Any arbitration shall be conducted in Houston,
Texas, before a single arbitrator appointed in the manner provided below. To
the extent and only to the extent that any controversy or claim arising out of
or relating hereto is determined to be a non-arbitrable issue, claim or
controversy under applicable law, the parties hereto agree to stay any
litigation or suit relating to such non-arbitrable cause of action, controversy
or claim until all other arbitrable controversies, claims and issues are
resolved by binding arbitration in accordance with this Section 13. All
parties hereto agree that any findings, judgments, or awards rendered by the
arbitrator shall be
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binding on all parties and may not be resubmitted or litigated in any
litigation, suit or proceeding relating to nonarbitrable issues.
(ii) Any party who desires to submit an issue(s) to arbitration
shall notify the other party in writing of the issue(s) to be arbitrated and a
brief statement of the matter in controversy. If the parties are unable to
resolve their differences within ten business days of the receipt of such
notice then either party may submit that issue(s) to arbitration.
(iii) Within 10 days of the submission of issue(s) to arbitration
the parties shall meet and attempt to agree on the selection and appointment of
an arbitrator. If agreement is reached as to the arbitrator within ten days
after such 10-day period, then the arbitrator shall be notified of his
appointment and instructed to proceed with determining the issues to be
arbitrated. If the parties are unable to agree upon a single arbitrator within
such ten day period, then as soon as practicable thereafter either party shall
have the right to request such appointment be made by the American Arbitration
Association through its Houston, Texas office in accordance with the then
applicable Commercial Arbitration Rules of the American Arbitration Association
and the arbitrator appointed in such manner shall be the arbitrator hereunder.
If the arbitrator fails, refuses or is unable to act as an arbitrator pursuant
hereto, then a substitute arbitrator shall be appointed in his stead, which
appointment shall be made in the same manner as the appointment of the
arbitrator so failing, refusing or unable to act.
(iv) Any party to this Agreement may bring as summary proceedings
(including, without limitation, a plea in abatement or motion to stay further
proceedings) an action in court to compel arbitration of any issues, claims and
controversies in accordance with this Agreement.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as
of the date and year first above written.
COMPANY: DENALI HOLDINGS, INC.
By: /s/ XXXXXXX X. XXXXXXX
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Name: Xxxxxxx X. Xxxxxxx
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Title: Chief Executive Officer
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EMPLOYEE:
/s/ XXXXX XXXXX
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Xxxxx Xxxxx
Address: P. X. Xxx 0000
Xxxx Xxxx, Xxxx 00000
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