FORM OF NONCOMPETITION AGREEMENT
This NONCOMPETITION AGREEMENT (the "Agreement") is entered into this
5th day of March, 1997, by and between________________________ ("Stockholder"),
and CRYOLIFE, INC., a Florida corporation ("CryoLife").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Agreement and Plan of Merger (the
"Merger Agreement") dated as of March __, 1997, by and among CryoLife, CryoLife
Acquisition Corporation, a Florida corporation and wholly-owned subsidiary of
CryoLife ("Newco"), Ideas for Medicine, Inc., a Florida corporation ("IFM"), and
the shareholders of IFM, IFM is being merged with and into Newco;
WHEREAS, pursuant to the Merger Agreement, CryoLife will acquire,
simultaneously with the execution of this Agreement and by virtue of its
ownership of Newco, ownership of the business and assets of IFM;
WHEREAS, Stockholder is a shareholder of IFM and acknowledges the
merger of IFM into Newco will benefit Stockholder through the receipt of cash
and shares of Common Stock of CryoLife;
WHEREAS, in order to induce CryoLife to enter into and consummate the
Merger Agreement, Stockholder has agreed to accept certain restrictions as set
forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
of the parties herein contained, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. DEFINITIONS. The following definitions shall apply to this
Agreement:
(a) "Company Business" means the business of designing,
manufacturing, marketing and distributing specialized tubing products, catheters
and medical instruments for use in the field of vascular, general, and
laparoscopic surgery, including carotid shunts, occlusion catheters, Xxxxxx dual
balloon catheters, embolectomy catheters, dual lumen catheters, aortic
catheters, venous access ports, cholangiogram catheters, and laparoscopic
instruments. Company Business includes the design, manufacture, mareting and
distribution of all products identified in the product catalogue of the
Surviving Corporation as of the date hereof.
(b) "Competing Business" means any person, concern, or entity that
is engaged in or conducts a business substantially the same as the Company
Business.
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(c) "Territory" means the United States, Germany, Italy, the
Netherlands, the United Kingdom, Canada, and France, which the parties hereby
acknowledge to be the geographic area in which IFM conducts the Company Business
on the date of this Agreement.
(d) "Trade Secrets" means information relating to IFM or the
business and technology of IFM, including, but not limited to, technical and
nontechnical data, formulas, patterns, designs, compilations, programs, devices,
methods, techniques, drawings, processes, financial data, financial plans,
product plans, pricing information, marketing information, and lists and
information with respect to actual or potential customers or suppliers, which
(1) derives economic value, actual or potential, from not being generally known
to or readily ascertainable by proper means by persons other than IFM who can
obtain economic value from its disclosure or use; and (2) is the subject of
efforts that are reasonable under the circumstances to maintain its secrecy.
2. NONCOMPETITION COVENANTS OF STOCKHOLDER. Stockholder acknowledges
that, by virtue of the special knowledge of the affairs, business, customers,
suppliers, vendors and the operations of the Company Business that Stockholder
has, CryoLife would suffer substantial damage if Stockholder breaches or
violates any of the covenants and agreements set forth in this Section 2 or
Section 3. Therefore, Stockholder has agreed to the following covenants and
agreements:
(a) Stockholder covenants that he shall not, for a period of five
years from and after the date hereof (the "Noncompetition Period"), directly or
indirectly, in the Territory, for his own account or as an owner, partner,
member, stockholder, joint venturer, investor, lender, director, officer,
employee, member, consultant, manager, independent contractor, or in any other
capacity, own, engage in, conduct, manage, operate or participate in any
Competing Business; provided, however, the foregoing covenant shall not be
deemed to prohibit Stockholder from acquiring as an investment not more than 2%
of the capital stock of a Competing Business whose stock is traded on a national
securities exchange or over-the-counter.
(b) During the Noncompetition Period, Stockholder covenants and
agrees that he will not, directly or indirectly, on his own behalf or in the
service or on behalf of others, solicit, divert or appropriate to a Competing
Business, or attempt to solicit, divert or appropriate to or for any Competing
Business, any persons and/or entities who were customers of IFM in the Territory
on the date immediately preceding the date of this Agreement, or any person
and/or entity in the Territory to whom IFM has sold or provided any products or
services during the 12-month period immediately preceding the date of this
Agreement.
(c) During the Noncompetition Period, Stockholder covenants and
agrees that he will not, directly or indirectly, on his own behalf or in the
service or on behalf of others, hire or attempt to hire any employee of Newco,
or to cause any such employee to
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leave his or her employment, in order to perform services in the Territory for a
Competing Business.
3. CONFIDENTIAL INFORMATION. Stockholder covenants and agrees that all
confidential and proprietary information developed, utilized, or received by
Stockholder relating to the operation of the Company Business prior to the
Closing of the Merger Agreement, including, without limitation, all Trade
Secrets and all information which has been disclosed to IFM by any third party
which IFM has treated as confidential (collectively, "Confidential
Information"), together with all physical embodiments thereof, has been
transferred to Newco pursuant to the Merger Agreement. Stockholder will hold
such Confidential Information in trust and strictest confidence, and will not
use, reproduce, distribute, disclose or otherwise disseminate the Confidential
Information (except use in connection with any employment of Stockholder by
CryoLife or Newco). The confidentiality requirements and use restrictions
contained in this Section 3 shall survive any termination of this Agreement but
shall not apply to any Confidential Information that falls into the public
domain through no fault of Stockholder.
All records, notes, files, memoranda, reports, marketing information,
price lists, supplier lists and information, documents, and all copies and like
items relating to the Trade Secrets which shall be disclosed to or which shall
come into the possession of Stockholder during or prior to the Noncompetition
Period shall be the sole and exclusive property of Newco. Stockholder agrees
that, at any time upon request, it will promptly deliver to CryoLife the
originals and all copies of any of the foregoing that are in his possession,
custody or control.
4. SEVERABILITY. Each provision of this Agreement is severable, and if
any one of such provisions shall be reformed or declared unenforceable, such
reformation or declaration shall not affect the enforceability or validity of
any other provision thereof. Each provision thereof shall be enforceable by
CryoLife or any successor or affiliate thereof against Stockholder
notwithstanding any claim or cause of action asserted by Stockholder against
CryoLife or any successor or affiliate thereof. The existence of any claim,
demand, action, or cause of action of Stockholder against CryoLife or any
affiliate shall not constitute a defense to the enforcement by CryoLife of any
of the covenants contained herein.
5. REFORMATION BY COURT. In the event any court of competent
jurisdiction should determine that any of the terms of this Agreement are
unreasonable or unenforceable in scope, Stockholder and CryoLife consent to the
exercise by such court of its equitable jurisdiction to reform such terms in
accordance with applicable law.
6. REMEDIES. Stockholder agrees that if it breaches any provision of
this Agreement, the damage to CryoLife would be difficult to ascertain, and
money damages would not afford CryoLife an adequate remedy. Therefore, if
Stockholder is in breach of this Agreement, the parties hereto agree that
CryoLife is entitled, in addition to any and all rights and remedies as would be
provided by law, to specific performance, injunctive, and other equitable relief
to prevent or restrain a breach of this Agreement. The rights of
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CryoLife under this Agreement are in addition to, and not in lieu of, any and
all rights CryoLife may have at law or in equity to protect its business
interests. Stockholder agrees to be liable for any and all costs and expenses,
including attorneys fees, resulting from the breach by Stockholder of any
provision of this Agreement.
7. AMENDMENTS. No amendment or modification of this Agreement shall be
valid or binding upon CryoLife unless made in writing and signed by a duly
authorized officer of CryoLife, or upon Stockholder, unless made in writing and
signed by Stockholder.
8. ASSIGNMENT. This Agreement may not be assigned by any party without
the prior written consent of the other party hereto, provided that CryoLife may
assign this Agreement in whole or in part to one or more affiliates thereof
without the consent of Stockholder.
9. NOTICES.
(a) Any and all notices or other communications required or
permitted to be given under any of the provisions of this Agreement shall be in
writing and shall be deemed to have been duly given when (i) personally
delivered or sent by a recognized overnight delivery service which guarantees
next day delivery ("Overnight Delivery"), (ii) transmitted by facsimile
transmission (with a copy sent first class registered or certified mail, return
receipt requested and postage prepaid or by Overnight Delivery), or (iii) mailed
by first class registered or certified mail, return receipt requested, postage
prepaid, transmitted or addressed to the parties at the addresses set forth
below:
If to Stockholder: _____________________________
with a copy to: _____________________________
If to CryoLife: CryoLife, Inc.
0000 Xxxxxxx Xxxxxxxxx, X.X.
Xxxxxxxx, Xxxxxxx 00000
Attention: Xx. Xxxxxx X. Xxxxxxxx,
President and Chief Executive Officer
Telefax: (000) 000-0000
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with a copy to: Arnall Golden & Xxxxxxx
2800 One Atlantic Center
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xx. Xxxxxxx X. Xxxxxxxxxx
Telefax: (000) 000-0000
(b) All notices shall be deemed received (i) if personally
delivered or transmitted by facsimile, on the business day when so delivered or
transmitted or if not transmitted at a time which concludes during the business
day of the recipient, on the next succeeding business day, (ii) if sent by
Overnight Delivery, one business day after it is sent and (iii) if mailed, 48
hours after deposit in the United States mail, as first class registered or
certified mail, return receipt requested, postage pre-paid. Either party may
change its address for the purposes of this Section by giving not less than ten
days prior written notice of such change to the other party in the manner
provided in this Section.
10. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
11. FLORIDA LAW. This Agreement shall be governed by the laws of the
State of Florida.
IN WITNESS WHEREOF, the parties hereto, intending to be legally bound,
have executed and delivered this Agreement as of the date set forth above.
CRYOLIFE, INC.
By:__________________________________
Xxxxxx X. Xxxxxxxx
President and Chief Executive Officer
STOCKHOLDER:
__________________________________
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