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Exhibit 10.21
NON-COMPETITION AGREEMENT
This Agreement is made and entered into as of January 5, 1994, by and
between RIBOGENE, INC., a California corporation, (the "PURCHASER"), and
XXXXXXX XXXXXX, an individual (the "SHAREHOLDER").
WHEREAS, the Shareholder is the only shareholder of HYLINE LABORATORIES,
INC., a New York corporation (the "SELLER"), who, along with the Purchaser and
the Shareholder, is party to that certain Asset Purchase Agreement dated January
5, 1994 (the "PURCHASE AGREEMENT"), pursuant to which the Purchaser has
purchased certain assets relating to the Seller's business; and
WHEREAS, the Shareholder is willing to enter into this Agreement in
further consideration of the obligations undertaken by the Purchaser in the
Purchase Agreement.
NOW, THEREFORE, in consideration of the mutual agreements and
obligations contained in this Agreement and in the Purchase Agreement, the
parties agree as follows:
1. Non-competition Covenant of the Shareholder. In consideration of
the payments set forth in Section 3 below, the Shareholder shall not, during the
period specified in Section 2 below, do any of the following without the prior
written consent of the Purchaser, directly or indirectly (whether as a
shareholder, partner, principal, agent, director, affiliate, consultant or
otherwise):
a. Carry on in any county in the United States of America or in
any other country in the world (the "RESTRICTED TERRITORY") any business
activity relating, directly or indirectly, to the development, marketing,
licensing or use of any of the Hyline Products (as defined in the Purchase
Agreement) or products intended for the same applications and utilizing the
same method delivery system as any of the Hyline Products; or
b. Solicit or influence or attempt to influence any person
employed by the Purchaser, including any person who may have been employed by
the Seller or the Shareholder prior to his or her employment with the
Purchaser, to terminate or diminish his or her employment with the Purchaser or
become an employee or consultant of the Shareholder, the Seller, any affiliate
of the Shareholder or the Seller, or any competitor of the Purchaser.
2. Duration. The covenants set forth in Section 1 shall be
effective commencing as of the date hereof and shall continue until the fifth
(5th) anniversary of the date of this Agreement.
3. Consideration. Purchaser shall pay to the Shareholder, as
consideration for the foregoing covenant not to compete, $82,000.00 on the
first (1st) anniversary of the date of this Agreement, $91,000.00 on the second
(2nd) anniversary of the date of this Agreement, $101,000.00 on the third (3rd)
anniversary of the date of this Agreement and $112,000.00 on the fourth (4th)
anniversary of the date of this Agreement, which payments shall be secured
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pursuant to a Security Agreement among the Purchaser, the Shareholder and the
Seller of even date herewith; provided that the Shareholder shall not be
entitled to, and the Purchaser shall not pay, further payments under this
Agreement from and after the date on which the Shareholder first fails to
comply in any material respect with the terms of this Agreement. If the
Purchaser shall fail to pay any amount due under this Section 3 within ten (10)
days following receipt of notice of such non-payment, and if such non-payment
shall violate the terms of this Agreement, all amounts payable from time to
time under this Section 3 shall become immediately due and payable.
4. Limitations on Non-Competition Covenant. Section 1 of this
Agreement shall not be deemed to apply to any investments the Shareholder may
make, directly or indirectly, in any publicly traded company so long as the
Shareholder's aggregate holdings do not exceed five percent (5%) of the
outstanding voting securities of such company.
5. Confidentiality. The Shareholder agrees not to disclose,
communicate, use to the detriment of the Purchaser (or its business) or for the
benefit of any other person, or misuse in any way, any proprietary or
confidential information of the Purchaser such as information relating to
Seller's business, trade secrets, personnel, processes, techniques, know-how,
customer lists, formulas and other information and technical data or the
Seller's Intellectual Property Rights (as defined in the Purchase Agreement).
Nothing in this Agreement shall restrict the Shareholder from using or
disclosing any information in any litigation or other proceedings or
investigation involving the assets sold to the Purchaser under the Purchase
Agreement or involving the Seller.
6. Severability. The parties intend that the covenants contained
in this Agreement shall be construed as a series of separate covenants, one for
each country, county, city and state (or comparable political subdivision) in
the Restricted Territory. Except for geographic coverage, each such separate
covenant shall be deemed identical in terms to the covenant contained in the
preceding paragraphs. If, in any judicial proceeding, a court shall refuse to
enforce any of the separate covenants (or any part thereof) deemed included in
such paragraphs, then such unenforceable covenant (or such part) shall be
deemed eliminated from this Agreement for the purpose of those proceedings to
the extent necessary to permit the remaining separate covenants (or portions
thereof) to be enforced by such court. It is the intent of the parties that the
covenants set forth herein be enforced to the maximum degree permitted by
applicable law. In the event that the provisions of this Agreement should ever
be deemed to exceed the scope, time or geographic limitations of applicable law
regarding covenants not to compete, then such provisions shall be reformed to
the maximum scope, time or geographic limitations, as the case may be,
permitted by applicable laws.
7. Remedies. The parties hereto acknowledge and agree that the
extent of damages to the Purchaser in the event of a breach of the covenants
contained in this Agreement by the Shareholder would be difficult or impossible
to ascertain and that there is and will be available to the Purchaser no
adequate remedy at law in the event of any such breach. Consequently, the
Shareholder hereby agrees that in the event of such breach, the Purchaser shall
be entitled to enforce any or all of the covenants contained in this Agreement
by injunctive or other equitable relief.
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8. Miscellaneous. Xxx xxxxxxxxxx xx Xxxxxxx 00(x), (x), (x), (x),
(x), (x), (x), (x) and (k) of the Purchase Agreement are incorporated herein by
reference and made a part hereof (with all references to the "Agreement"
therein being construed to be references to this Agreement).
IN WITNESS WHEREOF, the parties hereto have executed this
Non-Competition Agreement as of the date first written above.
PURCHASER: RIBOGENE, INC.
a California corporation
By: /s/ XXXXXXX X. XXXXXXXXX
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Title: President
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SHAREHOLDER: XXXXXXX XXXXXX
/s/ XXXXXXX XXXXXX
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