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Exhibit 10.30
AMENDED AND RESTATED COVENANT NOT TO COMPETE
This Amended and Restated Covenant Not to Compete (this "AGREEMENT"),
dated to be effective as of August 29, 1997, is entered into by and between
LIBBEY INC., a corporation organized under the laws of the State of Delaware,
United States of America ("LIBBEY"), and VITRO, S.A., a Sociedad Anonima
organized under the laws of the United Mexican States ("VITRO").
INTRODUCTION
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Libbey and Vitro entered into that certain Covenant Not to Compete
dated August 29, 1997 (the "Covenant"). Libbey and Vitro have agreed to amend,
restate, and supersede the Covenant by the terms and provisions of this
Agreement.
Libbey (or one or more of its Affiliates, as defined below) is in the
business of manufacturing, distributing, and selling, among other things, glass
tableware and chinaware. Vitro (or one or more of its Affiliates) is in the
business of manufacturing, distributing, and selling, among other things, glass
tableware, chinaware, flatware, hollowware, and OEM products made of glass.
Libbey (and certain of its Affiliates) and Vitro (and certain of its
Affiliates) have entered into that certain Master Investment Agreement dated
August 29, 1997 (the "MASTER INVESTMENT AGREEMENT"), pursuant to which, among
other things, Libbey (or one or more of its Affiliates) has acquired, directly
or indirectly, from Vitro (or one or more of its Affiliates) (a) 49% of the
total issued and outstanding shares of common stock of Vitrocrisa Holding, S.A.
de C.V. ("VC HOLDING"), (b) 49% of the total issued and outstanding voting
shares of common stock of Vitrocrisa, S.A. de C.V. ("VITROCRISA"), (c) an
undivided 49% interest in certain assets and liabilities (the "CRISA ASSETS") of
Crisa Corporation, a Texas corporation ("CRISA"), and has contributed such
interest to Crisa Industrial L.L.C., a Delaware limited liability company
("LLC"), in exchange for a 49% membership interest in the LLC, and (d)
substantially all of the assets of WorldCrisa Corporation, a Delaware
corporation ("WORLDCRISA"). In addition, the parties have entered into
distribution agreements for the sale (i) by Libbey in the United States and
Canada of products manufactured by Vitrocrisa and (ii) by Vitrocrisa in the
United Mexican States, Central America, and South America of products
manufactured by Libbey Glass Inc., a Delaware corporation and wholly-owned
subsidiary of Libbey ("LIBBEY GLASS"). Libbey's obligations and commitments
under the Master Investment Agreement are collectively referred to herein as the
"LIBBEY INVESTMENT".
In consideration of the premises and mutual promises contained herein
and as a material inducement for the execution by Libbey and Vitro of the Master
Investment Agreement and the consummation of the transactions contemplated
thereby, including the Libbey Investment, together with other consideration, the
adequacy and receipt of which are hereby acknowledged, Libbey and Vitro agree as
follows:
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Section 1. DEFINITIONS. The following terms shall have the meanings set
forth beside such terms when used in this Agreement:
(a) "AFFILIATE" means with respect to each of the parties, any
other Person or party which at the relevant time, directly or
indirectly, controls, is controlled by, or is under common
control with, such party. The term "CONTROL" as used with
respect to any Person or party, means the possession, directly
or indirectly, of the power to direct or cause the direction
of the management and policies of such Person or party,
whether through the ownership of voting securities, by
contract, or otherwise.
(b) "DISTRIBUTION AGREEMENTS" means collectively the Amended and
Restated Distribution Agreement, dated of even date, by and
between Vitro, Vitrocrisa, Libbey, and Libbey Glass and the
Amended and Restated Distribution Agreement, dated of even
date, by and between Vitro, Crisa, Vitrocrisa, Libbey, and
Libbey Glass.
(c) "EXCLUDED PRODUCTS" means coffee pots, meter covers, glass
covers for cooking xxxx, blender jars, and lighting fixtures
sold to OEMs. In addition, "Excluded Products" shall mean any
other OEM article for sale to OEM customers that are not in
direct competition with Libbey Glass and are not sold to
Libbey Glass' customers, including those in the Foodservice,
Industrial, Premium, and Retail Channels of Distribution.
(d) "FOODSERVICE CHANNEL OF DISTRIBUTION" means sales to
foodservice distributors, foodservice importers, hotels,
restaurants, chain restaurants, bars, casinos, airlines,
cruise lines, breweries, microbreweries, hospitals, health
care facilities, penal institutions, colleges, all eating and
drinking establishments, independent cutters and decorators,
and warehouse clubs; internet sales in all the above segments;
and all other generally acknowledged distributor and end-user
segments of the traditional foodservice sector of the country
specified.
(e) "GLASS TABLEWARE" means those products that are the subject of
the exclusive distribution rights set forth in the
Distribution Agreements, namely the glass product lines
illustrated in the current 1997 catalogs of Libbey Glass,
Vitrocrisa, Crisa, and WorldCrisa; all glass products of the
type sold by Libbey Glass or Vitrocrisa, other than Excluded
Products, into the Foodservice, Industrial, Premium, or Retail
Channels of Distribution; future new products, other than
Excluded Products, of Libbey Glass or Vitrocrisa; and new and
existing products, other than Excluded Products, sold by
Libbey Glass or Vitrocrisa and specially differentiated
through packaging under the brand name, identification, or
logo of the purchaser (a "SPECIALLY DIFFERENTIATED PRODUCT").
The intent is that any glass tableware, other than Excluded
Products, that is destined for application in the Foodservice,
Industrial, Premium, and Retail Channels of Distribution are
the products that are Glass Tableware.
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(f) "INDUSTRIAL CHANNEL OF DISTRIBUTION" means sales to candle
packers, religious candle markets, distilleries, wineries,
floral distributors, mounters and fabricators, the cosmetic
industry, and all other generally acknowledged segments of the
traditional industrial sector of the country specified.
(g) "INDUSTRIAL GLASSWARE" means coffee pots, meter covers, glass
covers for cooking xxxx, blender jars, and lighting fixtures
sold to OEMs.
(h) "LIBBEY PARTIES" means Libbey, Libbey Glass, LGA 2, a Delaware
corporation, LGA 3, a Delaware corporation, and LGA 4, a
Delaware corporation.
(i) "LIBBEY TERRITORY" means those certain geographic areas set
forth on SCHEDULE 1 hereto.
(j) "OEM" means original equipment manufacturer.
(k) "PERSON" will be broadly construed to mean an individual,
corporation, partnership, association, trust, unincorporated
organization, governmental entity, or other entity or group.
(l) "PREMIUM CHANNEL OF DISTRIBUTION" means sales for use as a
premium or to promote another product, including, without
limitation, sales for such purposes to customers in the fast
food industry, oil industry, soft-drink industry, supermarket
continuity industry, premium packaging, and all other
generally acknowledged segments of the traditional premium and
incentive sector of the country specified.
(m) "RETAIL CHANNEL OF DISTRIBUTION" means sales to retail
distributors, mass merchant discount stores, department
stores, specialty retail stores, craft stores, supermarkets,
factory outlet stores, dinnerware companies, flea markets,
door-to-door direct sales, wholesale outlets, gift shops,
potteries, catalog showrooms, warehouse clubs, home shopping
networks, internet sales for consumer use, private label sales
for any class of retailer, importers, and all other generally
acknowledged segments of the traditional retail sector of the
country specified.
(n) "VITRO PARTIES" means Vitro, VC Holding, Vitrocrisa,
WorldCrisa, and Crisa.
(o) "VITRO TERRITORY" means those certain geographic areas set
forth on SCHEDULE 2 hereto.
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Section 2. AMENDED AND RESTATED AGREEMENT. The terms and provisions of
the Covenant are hereby canceled and superseded by the terms and provisions of
this Agreement. All references in any other agreement to the Covenant Not to
Compete dated August 29, 1997 by and between Vitro and Libbey shall be deemed to
refer to this Agreement, and all references to specific provisions of such
Covenant Not to Compete contained in any other agreement shall refer to the
corresponding provisions of this Agreement.
Section 3. AGREEMENT OF NON-COMPETITION.
(a) Vitro and Libbey acknowledge, for themselves and on behalf of
the Vitro Parties and Libbey Parties, respectively, that this
SECTION 3 is entered into as a material inducement for the
execution of the Master Investment Agreement and the
consummation of the transactions contemplated thereby,
including the Libbey Investment.
(b) For a period beginning on the date of this Agreement and
ending on the date that either Libbey or an Affiliate of
Libbey, on the one part, or Vitro or an Affiliate of Vitro, on
the other part, cease to own, directly or indirectly, at least
twenty-five percent (25%) of the total issued and outstanding
voting shares of Vitrocrisa (the "TRANSFER DATE"):
(i) Except as provided in the Distribution Agreements,
Vitro will not, and Vitro will cause its Affiliates
not to, sell any Glass Tableware in the Libbey
Territory, unless such sales are to or through Libbey
or an Affiliate of Libbey; provided, however, that
the restriction set forth in this SECTION 3(b)(i)
shall immediately cease if Libbey or an Affiliate of
Libbey ceases to be the distributor for Vitrocrisa in
the Libbey Territory under the applicable
Distribution Agreement.
(ii) Except as provided in the Distribution Agreements,
Libbey will not, and Libbey will cause its Affiliates
not to, sell any Glass Tableware or Industrial
Glassware in the Vitro Territory, unless such sales
are to or through Vitrocrisa; provided, however, that
the restriction set forth in this SECTION 3(b)(ii)
shall immediately cease if Vitrocrisa ceases to be
the distributor for Libbey Glass in the Vitro
Territory under the applicable Distribution
Agreement.
(iii) Except as provided in the Distribution Agreements,
Vitro will not, and Vitro will cause its Affiliates
not to, sell any Glass Tableware or Industrial
Glassware in the Vitro Territory and the Libbey
Territory, unless such sales are to or through
Vitrocrisa, except as otherwise provided in SECTION
3(e)(i) with respect to Industrial Glassware.
(c) For a period beginning on the date of this Agreement and
ending on the third anniversary of the Closing Date (as
defined in the Master Investment Agreement),
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Vitro will not, and Vitro will cause its Affiliates not to,
sell in the Libbey Territory any flatware, hollowware, or
chinaware in competition with Libbey and its Affiliates in
their operation of the business formerly operated as
WorldCrisa and purchased from Vitro or a Vitro Affiliate
pursuant to the Master Investment Agreement.
(d) For a period beginning on the date of this Agreement and
ending (i) on the date three years after the Transfer Date,
(A) Vitro will not, and Vitro will cause its Affiliates not
to, engage, directly or indirectly, whether as owner, partner,
stockholder, investor (except that such entities may
beneficially own less than five percent (5%) of the common
equity of a publicly traded company, the shares of which are
listed on a major stock exchange), in the manufacture of Glass
Tableware in the Libbey Territory; and (B) Libbey will not,
and Libbey will cause its Affiliates not to, engage, directly
or indirectly, whether as owner, partner, stockholder,
investor (except that such entities may beneficially own less
than five percent (5%) of the common equity of a publicly
traded company, the shares of which are listed on a major
stock exchange), in the manufacture of Glass Tableware in the
geographic area set forth on SCHEDULE 3 hereto; and (ii) on
the Transfer Date, Libbey will not, and Libbey will cause its
Affiliates not to, engage, directly or indirectly, whether as
owner, partner, stockholder, investor (except that such
entities may beneficially own less than five percent (5%) of
the common equity of a publicly traded company, the shares of
which are listed on a major stock exchange) in the manufacture
of Glass Tableware in the Vitro Territory located outside of
the geographic area set forth on SCHEDULE 3 hereto.
(e) Notwithstanding SECTION 3(d), for a period beginning on the
date of this Agreement and ending on the Transfer Date:
(i) Vitro will not, and Vitro will cause its Affiliates
not to, develop and pursue future equity investment
opportunities in manufacturing or distribution
facilities located in the Vitro Territory (outside of
its current facilities located at Monterrey, Mexico)
for the manufacture, distribution, or sale of Glass
Tableware or Industrial Glassware, unless such
investment opportunities are developed and pursued
through Vitrocrisa; provided, however, if Libbey
decides that Vitrocrisa should not develop and pursue
such investment opportunities for Industrial
Glassware, then Vitro or its Affiliates shall have
the right to develop and pursue such investment
opportunities on its own.
(ii) Subject to SECTION 3(e)(iii), Libbey will not, and
Libbey will cause its Affiliates not to, develop and
pursue future equity investment opportunities in
manufacturing or distribution facilities located in
the Vitro Territory (outside of Vitrocrisa) for the
manufacture, distribution, or sale of Glass Tableware
or Industrial Glassware, unless such investment
opportunities are developed and pursued through
Vitrocrisa.
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(iii) Notwithstanding SECTION 3(e)(ii), Vitro agrees to
allow as the only exception for investment
opportunities in the Vitro Territory outside the
currently defined share participation in Vitrocrisa,
that if a business opportunity is brought by Libbey
relative to that certain company set forth on
SCHEDULE 4 hereto (the "JOINT INVESTMENT COMPANY"),
both partners will negotiate in good faith at that
time with the joint goals to accommodate the needs of
the other partner under a share participation of
Vitro of up to and including 50%; provided, however,
that in such a case (whether or not Vitro so
participates), all exports of Glass Tableware and
Industrial Glassware by the Joint Investment Company
from the country of its domicile as set forth on
SCHEDULE 4 hereto (its "HOME COUNTRY") to any other
country in the Vitro Territory will be exclusively
channeled through Vitrocrisa, but the Joint
Investment Company may sell its Glass Tableware and
Industrial Glassware in its Home Country. Performance
criteria will be developed for the first three (3)
years of such distribution, which will be similar in
principle to the performance clause developed for
Libbey Glass under the Distribution Agreement where
Libbey serves as the exclusive distributor of
Vitrocrisa for Glass Tableware in the Libbey
Territory. After the Closing Date (as defined in the
Master Investment Agreement), it is understood that a
letter of intent will be drafted and signed by both
parties in which the points, positions, and desires
of each party relative to a future possible
investment opportunity with the Joint Investment
Company (which will be based upon the arrangements
relating to Vitrocrisa between the parties) are
clearly expressed to serve as a guideline to be used
in a business-like and "good faith" effort to respect
and accommodate them in the negotiation process at
that time.
(f) If any provision of this SECTION 3 should be found by any
court of competent jurisdiction to be unreasonable by reason
of its being too broad as to the period of time, territory,
and/or scope, then, and in that event, such provision will
nevertheless remain valid and fully effective, but will be
considered to be amended so that the period of time,
territory, and/or scope set forth will be changed to be the
maximum period of time, the largest territory, and/or the
broadest scope, as the case may be, which would be found
reasonable and enforceable by such court.
(g) Vitro acknowledges that Libbey Glass is a party to technical
assistance agreements with certain companies throughout the
world and agrees that this Agreement shall not prohibit Libbey
Glass from licensing and continuing to license its technology
throughout the world; provided, however, that Libbey Glass
agrees to advise and consult Vitrocrisa before entering into
any new license arrangement in the geographic areas set forth
on SCHEDULE 5 hereto or renewing any existing licenses in the
geographic areas set forth on SCHEDULE 5 hereto for the
licensing of technology and the provision of technical
assistance to existing and
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potential licensees, but both parties agree that the ultimate
decision to enter into such licenses or to provide such
technical assistance rests in the sole and absolute discretion
of Libbey Glass.
4. ENFORCEMENT; NON-WAIVER.
(a) Each party hereby acknowledges and agrees that the failure of
it or of any of its Affiliates to perform its agreements and
covenants under this Agreement, including, without limitation,
any violation of the agreements and covenants set forth in
SECTION 3, will cause irreparable injury to the other party
and its Affiliates for which damages, even if available, will
not be an adequate remedy. Accordingly, each party hereby
consents to the issuance of injunctive relief by any court of
competent jurisdiction in the United States of America (or of
any state thereof) or of the United States of Mexico having
jurisdiction over it to compel performance of such party's
obligations and to the granting by any court of the remedy of
specific performance of its obligations under this Agreement,
in addition to any other remedy to which the other party may
be entitled, at law or in equity.
(b) A failure by either party to exercise or enforce any rights
conferred upon it by this Agreement shall not be deemed to be
a waiver of any such rights or operate so as to bar the
exercise or enforcement thereof at any subsequent time or
times, and all express rights granted to such party hereunder
shall be in addition to any rights that such party may have
under the general law in respect of a breach hereof. No waiver
by either party of any condition or the breach of any term,
covenant, representation, warranty, or undertaking contained
in this Agreement, whether by conduct or otherwise, in any one
or more instances shall be deemed to be or construed as a
further or continuing waiver of any such condition or breach
or a waiver of any other condition or deemed to be or
construed as the breach of any other term, covenant,
representation, warranty, or undertaking in this Agreement.
Section 5. MISCELLANEOUS.
(a) ENGLISH AS CONTROLLING LANGUAGE. Notwithstanding the
translation of this Agreement into Spanish or any other
language, the English language version of this Agreement shall
be controlling and shall govern in any legal proceeding or
arbitration.
(b) NO THIRD PARTY RIGHTS. This Agreement shall not confer any
rights or remedies upon any person other than the parties and
their respective successors and permitted assigns.
(c) ENTIRE AGREEMENT. This Agreement and the agreements referred
to herein constitute the entire agreement among the parties
related to the subject matter hereof and supersedes any prior
understandings, agreements, or representations
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by or among the parties, written or oral, that may have
related in any way to the subject matter hereof.
(d) ASSIGNMENT. No party may assign or otherwise transfer any of
its rights or obligations under this Agreement without the
prior written consent of the other party. Any purported or
attempted assignment contrary to the terms hereof shall be
null and void and of no force or effect. This Agreement shall
be binding upon and inure to the benefit of the parties named
herein and their respective successors and permitted assigns.
(e) COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but
all of which together will constitute one and the same
instrument.
(f) CAPTIONS. The sections headings contained in this Agreement
are inserted for convenience only and are not part of this
Agreement and shall not affect in any way the meaning or
interpretation of this Agreement.
(g) NOTICES. All notices, demands, requests, and other
communications given hereunder shall be made in writing in
English and shall be delivered in person or by courier or
overnight delivery service (delivery charge prepaid) or
telecopy (provided that the telecopy is confirmed by notice by
certified mail, courier, or overnight delivery service). Any
notice, demand, request, or other communication shall be
effective only if and when it is received by the addressee.
For the purposes of the foregoing, the addresses and
telecopier numbers of the parties hereto are as follows:
If to Libbey, such notices shall be addressed to:
Libbey Inc.
000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxx 00000
XXX
Attn: General Counsel Fax No. (000) 000-0000
or to any subsequent address of which Libbey may notify the
other parties in writing.
If to Vitro, such notices shall be addressed to:
Vitro Corporativo, S.A. de C.V.
Av. del Xxxxx 660
Col. Xxxxx xxx Xxxxxxxxx
Xxxxx Xxxxxx, X.X.
Xxxxxx 00000
Attn: Director Juridico Internacional Fax No. (000) 000-0000
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or at any subsequent address of which Vitro may notify the
other parties in writing.
Any party hereto may change its address or telecopier number
for the purposes hereof by giving notice thereof to the other
parties in the manner provided herein.
(h) AMENDMENTS. This Agreement may be amended, modified,
superseded, or canceled and any of its terms, covenants,
representations, warranties, undertakings, or conditions may
be waived only by an instrument in writing signed by (or by
some person duly authorized by) all of the parties hereto or,
in the case of a waiver, by the party waiving compliance.
(i) REMEDIES. Each party to this Agreement agrees that all rights
and remedies under this Agreement are cumulative and that no
election or exercise of any right or remedy will be deemed an
exclusion of any other right or remedy.
(j) GOVERNING LAW. This Agreement will be governed by, and
construed in accordance with, the substantive laws of the
State of Texas, without giving effect to any conflicts-of-law,
rule, or principle that might require the application of the
laws of another jurisdiction.
(k) ARBITRATION. Any controversy or claim arising out of or
relating to this Agreement, or the breach thereof, shall,
following a demand from either party (hereinafter, the "DEMAND
FOR ARBITRATION") be settled by arbitration in accordance with
the then existing International Arbitration Rules of the
American Arbitration Association (hereinafter "AAA").
Notwithstanding the foregoing, the parties hereby agree that
either party may seek injunctive relief in accordance with
SECTION 4, and the parties further agree that if a party seeks
injunctive relief in accordance with SECTION 4, such party
does not thereby waive its rights to arbitration under this
SECTION 5(k).
The arbitral tribunal shall be composed of three arbitrators.
Each party, namely Libbey and Vitro, shall appoint one
Arbitrator. If a party fails to appoint an arbitrator within
thirty (30) days after the date the claimant's Demand for
Arbitration is communicated to the other parties (hereinafter
the "NOTIFICATION DATE"), the AAA shall make such appointment.
The two arbitrators thus appointed shall attempt to agree upon
the appointment of a third arbitrator to serve as chairman of
the arbitral tribunal. If said two arbitrators fail to agree
upon the appointment of such third arbitrator within sixty
(60) days after the Notification Date, the AAA shall make such
appointment. The place of arbitration shall be Dallas, Texas,
United States of America. The arbitral proceeding shall be
conducted in the English language. To the extent that they may
validly so agree, the parties hereby exclude any right of
appeal to any court in connection with the arbitral award.
Judgment
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upon the arbitral award may be entered in any court having
jurisdiction thereof or having jurisdiction over either party
or either party's assets.
The validity of this SECTION 5(k) shall be governed by the
United Nations Convention on the Recognition and Enforcement
of Foreign Arbitral Awards or the Inter-American Convention on
International Commercial Arbitration, to which Mexico and the
United States of America have adhered.
All costs of arbitration and enforcement thereof, including
reasonable attorneys' fees and court costs, costs of expert
witnesses, transportation, lodging and meal costs of the
parties and witnesses, costs of transcript preparation, and
other reasonable and necessary direct and incidental costs
shall be apportioned to one or both parties by a majority of
the arbitrators as they deem appropriate. In the event any
party to this Agreement commences legal proceedings to enforce
the arbitral award, the expense of such litigation (including
reasonable attorneys' fees and costs of court) shall be borne
by the party not prevailing therein.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the day and year first above
written.
LIBBEY, INC.
By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
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Title: Vice President and Chief Financial Officer
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VITRO, S.A.
By: /s/ Claudio Del Ville
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Name: Claudio Del Ville
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Title: Attorney in Fact
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