1
Exhibit (c)(3)
NONCOMPETITION AND NONDISCLOSURE AGREEMENT
THIS NONCOMPETITION AND NONDISCLOSURE AGREEMENT is made and entered into
this 4th day of December, 1996, by and between Xxxxxx X. Xxxxxx (the
"Executive") and Hadco Corporation (hereinafter referred to as the "Parent"), a
corporation organized under the laws of the Commonwealth of Massachusetts.
WITNESSETH
WHEREAS, Parent and Hadco Acquisition Corp. ("Sub"), a wholly-owned
subsidiary of Parent, are prepared to enter into an Agreement and Plan of
Reorganization (the "Merger Agreement") whereby Parent and Sub would acquire all
of the outstanding common stock of Zycon Corporation (the "Company") and the
Company would become a wholly-owned subsidiary of the Parent;
WHEREAS, Executive is willing to execute this Agreement and to be bound by
the provisions hereof in order to induce Parent to enter into the Merger
Agreement; and
NOW, THEREFORE, in consideration of the covenants and agreements herein
contained, the parties hereto agree as follows:
1. During the period of his employment by the Company (the "Employment
Period"), Executive agrees that he will devote his full time and best efforts to
the business of the Company. Executive agrees that he will not, directly or
indirectly, alone or as a partner, representative, investor, agent, consultant,
officer, director, employee or stockholder of any entity, engage in any business
activity involving (a) the design, manufacturing, marketing, distribution or
sale of printed circuit boards, flexible circuits, and/or backplanes and
assemblies, or (b) contract manufacturing involving interconnect products
(collectively, the "Business") during the period of his employment by the
Company and for three years thereafter; PROVIDED that nothing herein shall
prevent Executive from owning up to 1% of any class of securities listed on a
national securities exchange (including the Nasdaq). Executive also agrees that
during the period of his employment by the Company and for three years
thereafter he will not, directly or indirectly, alone or as a partner,
representative, investor, agent, consultant, officer, director, employee or
stockholder of any entity, solicit or do business relating to the Business with
any customer of the Company or any potential customer of the Company with whom
he has had contact. Executive also agrees that he will not, directly or
indirectly, alone or as a partner, representative, investor, agent, consultant,
officer, director, employee or stockholder of any entity solicit, interfere with
or endeavor to entice away any employee of the Company during the period of his
employment by the Company and for three years thereafter. The period following
the termination of Executive's employment during which these restrictions apply
(the "Post-employment Period") shall be extended by the length of any period of
time during the Post-employment Period during which he is in violation of this
paragraph.
2
-2-
2. Executive shall not at any time, whether during or after the Employment
Period, reveal to any person or entity any of the trade secrets or confidential
information concerning the organization, business or finances of the Company or
of any third party which the Company is under an obligation to keep confidential
(including but not limited to trade secrets or confidential information
respecting inventions, products, designs, methods, know-how, techniques,
systems, processes, software programs, works of authorship, customer lists,
projects, plans and proposals), except as may be required in the ordinary course
of performing his duties as an employee of the Company, and Executive shall keep
secret all matters entrusted to him and shall not use or attempt to use any such
information in any manner which may injure or cause loss or may be calculated to
injure or cause loss, whether directly or indirectly, to the Company. Further,
Executive agrees that during and after the Employment Period he shall not make,
use or permit to be used any notes, memoranda, reports, lists, records,
drawings, sketches, specifications, software programs, data, documentation or
other materials of any nature relating to any matter within the scope of the
business of the Company or concerning any of its dealings or affairs otherwise
than for the benefit of the Company, it being agreed that all of the foregoing
shall be and remain the sole and exclusive property of the Company, and that
immediately upon the termination of Executive's employment he shall deliver all
of the foregoing, and all copies thereof, to the Company, at its main office.
3. If at any time or times during Executive's employment he shall (either
alone or with others) make, conceive, create, discover, invent or reduce to
practice any invention, modification, discovery, design, development,
improvement, process, software program, work of authorship, documentation,
formula, data, technique, know-how, trade secret or intellectual property right
whatsoever or any interest therein (whether or not patentable or registrable
under copyright, trademark or similar statutes (including but not limited to the
Semiconductor Chip Protection Act) or subject to analogous protection) (herein
called "Developments") that (i) relates to the business of the Company or any
customer of or supplier to the Company or any of the products or services being
developed, manufactured or sold by the Company or which may be used in relation
therewith, (ii) results from tasks assigned to Executive by the Company or (iii)
results from the use of premises or personal property (whether tangible or
intangible) owned, leased or contracted for by the Company, then:
(a) such Developments and the benefits thereof are and shall
immediately become the sole and absolute property of the Company and its
assigns, as works made for hire or otherwise;
(b) Executive shall promptly disclose to the Company (or any persons
designated by it) each such Development;
(c) as may be necessary to ensure the Company's ownership of such
Developments, Executive hereby assigns any rights (including, but not
limited to, any copyrights and trademarks) he may have or acquire in the
Developments and benefits and/or rights resulting therefrom to the Company
and its assigns without further compensation; and
3
-3-
(d) Executive shall communicate, without cost or delay, and without
disclosing to others the same, all available information relating thereto
(with all necessary plans and models) to the Company.
4. Executive shall, during and after the Employment Period, at the request
and cost of the Company, promptly sign, execute, make and do all such deeds,
documents, acts and things as the Company and its duly authorized agents may
reasonably require:
(a) to apply for, obtain, register and vest in the name of the Company
alone (unless the Company otherwise directs) letters patent, copyrights,
trademarks or other analogous protection in any country throughout the
world and when so obtained or vested to renew and restore the same; and
(b) to defend any judicial, opposition or other proceedings in respect
of such applications and any judicial, opposition or other proceedings or
petitions or applications for revocation of such letters patent, copyright,
trademark or other analogous protection.
In the event the Company is unable, after reasonable effort, to secure
his signature on any application for letters patent, copyright or trademark
registration or other documents regarding any legal protection relating to a
Development, whether because of his physical or mental incapacity or for any
other reason whatsoever, Executive hereby irrevocably designates and appoints
the Company and its duly authorized officers and agents as his agent and
attorney-in-fact, to act for and in his behalf and stead to execute and file any
such application or applications or other documents and to do all other lawfully
permitted acts to further the prosecution and issuance of letters patent,
copyright or trademark registrations or any other legal protection thereon with
the same legal force and effect as if executed by Executive.
5. Executive agrees that any breach of this Agreement by him will cause
irreparable damage to the Company and Parent and that in the event of such
breach the Company and Parent shall have, in addition to any and all remedies of
law, the right to an injunction, specific performance or other equitable relief
to prevent the violation of his obligations hereunder. Executive further agrees
and acknowledges that the post-employment non-competition provision set forth in
Paragraph 1 hereof, and the remedies set forth in this paragraph, are necessary
and reasonable to protect the business of the Company and Parent.
6. Executive understands that this Agreement does not create an obligation
on the Company or any other person or entity to continue his employment.
7. No claim of Executive against the Company or Parent shall serve as a
defense against the Company's or Parent's enforcement of any provision of this
Agreement.
8. Executive represents that the Developments identified in the pages, if
any, attached hereto as EXHIBIT A comprise all the unpatented and unregistered
copyrightable Developments which he has made, conceived or created prior to the
Employment Period, which
4
-4-
Developments are excluded from this Agreement. Executive understands that it is
only necessary to list the title and purpose of such Developments but not
details thereof.
9. Executive hereby represents that, except as he has disclosed in writing
to the Company and Parent, he is not a party to, or bound by the terms of, any
agreement with or obligation to any previous employer or other party to refrain
from using or disclosing any trade secret or confidential or proprietary
information in the course of his employment with the Company or to refrain from
competing, directly or indirectly, with the business of such previous employer
or any other party. He further represents that his performance of all the terms
of this Agreement and as an employee of the Company does not and will not breach
any agreement or obligation to keep in confidence proprietary information,
knowledge or data acquired by him in confidence or in trust prior to or during
his employment with the Company, and he will not disclose to the Company or
induce the Company to use any confidential or proprietary information or
material belonging to any previous employer or others. Executive has not entered
into, and he agrees, he will not enter into, any agreement, either written or
oral, in conflict with the terms of this Agreement.
10. Any waiver by the Company or Parent of a breach of any provision of
this Agreement shall not operate or be construed as a waiver of any subsequent
breach of such provision or any other provision hereof.
11. Executive hereby agrees that each provision herein shall be treated as
a separate and independent clause, and the unenforceability of any one clause
shall in no way impair the enforceability of any of the other clauses herein.
Moreover, if one or more of the provisions contained in this Agreement shall for
any reason be held to be excessively broad as to scope, activity, subject or
otherwise so as to be unenforceable at law, such provision or provisions shall
be construed by the appropriate judicial body by limiting or reducing it or
them, so as to be enforceable to the maximum extent compatible with the
applicable law as it shall then appear.
12. Executive's obligations under this Agreement shall survive the
termination of his employment regardless of the manner of such termination and
shall be binding upon his heirs, executors, administrators and legal
representatives.
13. The term "Company" shall include Zycon Corporation and any of its
subsidiaries, subdivisions or affiliates. The Company and Parent shall have the
right to assign this Agreement to their successors and assigns, and all
covenants and agreements hereunder shall inure to the benefit of and be
enforceable by said successors or assigns.
14. This Agreement shall be governed by and construed in accordance with
the internal laws of the State of California. Any claims or legal actions by one
party against the other arising out of the relationship between the parties
contemplated herein (whether or not arising under this Agreement) shall be
governed by the laws of the State of California and shall be commenced and
maintained in any state or federal court located in California, and both parties
hereby submit to the jurisdiction and venue of any such court.
5
-5-
15. This Agreement shall become effective immediately upon the execution of
the Merger Agreement. This Agreement shall terminate and have no further force
or effect if the Merger Agreement shall be terminated pursuant to Section 8.1
thereof.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
6
-6-
IN WITNESS WHEREOF, the parties have duly executed this Agreement on
the date first written above, effective as of such date.
EXECUTIVE:
/s/ Xxxxxx X. Xxxxxx
----------------------------------
Name (please print):
HADCO CORPORATION
By: Xxxxxx X. Xxxxx
-------------------------------
Title: President
----------------------------
7
EXHIBIT A
---------
Prior Developments
------------------
None
