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EXHIBIT 10.20
NON-COMPETITION AGREEMENT
This NON-COMPETITION AGREEMENT (this "Agreement") is made and
entered into as of this 6th day of July, 1999, by and among Medical Device
Manufacturing, Inc., a Colorado corporation ("Buyer"), G&D, Inc., a Colorado
corporation d/b/a Star Guide Corporation ("Star Guide"), and Xxxx Xxxxxxx ("X.
Xxxxxxx").
WITNESSETH:
WHEREAS, Buyer has entered into that certain Agreement of
Purchase and Sale of Stock, dated July __, 1999 (the "Stock Purchase
Agreement"), by and among Buyer, Star Guide, Xxxx Xxxxxxx, Xxxxxx Xxxxxxx
("X. Xxxxxxx"), Xxxxxx Xxxxxxxxxxx ("Xxxxxxxxxxx"), the Xxxxxx Xxxxxxx
Irrevocable Spousal Trust No. 1 ("Xxxxxxx Trust No. 1"), the Xxxxxx Xxxxxxx
Irrevocable Spousal Trust No. 2 ("Xxxxxxx Trust No. 2;" and, together with
Xxxxxxx Trust No. 1, "Xxxxxxx Trusts"), Xxxxxxxx Xxxxxxxx ("Xxxxxxxx") and
Xxxxxx Xxxxxxx ("Xxxxxxx;" and, together with X. Xxxxxxx, H. Pollock,
Archambault, Xxxxxxx Trusts and Xxxxxxxx, "Selling Parties" and each
individually, a "Selling Party"), pursuant to which Buyer is purchasing from the
Selling Parties, collectively, all of the outstanding capital stock of Star
Guide;
WHEREAS, the Selling Parties collectively own all of the
issued and outstanding capital stock of Star Guide; and
WHEREAS, Buyer is unwilling to proceed with the transactions
contemplated by the Stock Purchase Agreement (the "Purchase") unless X. Xxxxxxx
agrees to refrain from engaging in certain activities described herein, and
Buyer has conditioned its commitment to proceed with the Purchase upon the
receipt of this duly executed Agreement from X. Xxxxxxx.
NOW THEREFORE, in consideration of the mutual promises and
covenants contained herein, the agreement of Buyer to consummate the Purchase,
and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, Buyer, Star Guide and X. Xxxxxxx agree as follows:
1. Non-Competition Commitment.
(a) Agreement Not to Compete. X. Xxxxxxx agrees that, for a
period of five (5) years after the date of this Agreement, he shall not,
directly or indirectly, through an Affiliate (as defined below) or otherwise,
either for the benefit of himself or for the benefit of any other person, firm,
corporation, governmental or private entity, or any other entity of any kind,
without the prior written consent of Buyer and Star Guide, which consent may be
withheld by Buyer and Star Guide, as applicable, in their sole discretion,
compete with Buyer, Star Guide or any Affiliate of either Buyer or Star Guide in
any manner or capacity (e.g., through any form of ownership or as an advisor,
principal, agent, partner, officer, director, stockholder, employee, member of
any association or otherwise) in any phase of the business that Buyer, Star
Guide or any Affiliate of either Buyer or Star Guide is conducting during the
term of this Agreement within the geographical area described in Section 1(b)
below. For purposes of this Agreement,
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"Affiliate" of a person or entity means any person or entity controlled by,
controlling or under common control with such person or entity, or any member of
the immediate family, including parents, spouse, children or siblings, of such
person; provided, however, that for purposes of this Agreement X. Xxxxxxx and
Buyer shall not be considered Affiliates of each other.
(b) Geographic Extent of Covenant. The obligations of X.
Xxxxxxx under Section 1(a) shall apply to any geographic area in which Buyer,
Star Guide or any Affiliate of either Buyer or Star Guide (i) has engaged in any
business during the term of this Agreement through any production, promotional,
sales or marketing activity, or otherwise, or (ii) has otherwise established its
goodwill, business reputation or any customer or supplier relations. X. Xxxxxxx
hereby acknowledges that the geographic boundaries, scope of prohibited
activities and the time duration of the provisions of this Section 1 are
reasonable and are no broader than are necessary to protect the legitimate
business interests of Buyer and Star Guide, including, without limitation, the
ability of Buyer to realize the benefit of its bargain and enjoy the goodwill of
Star Guide.
(c) Indirect Competition. X. Xxxxxxx further agrees that,
during the term of this Agreement, he will not, directly or indirectly, assist
or encourage any other person in carrying out, directly or indirectly, any
activity that would be prohibited by the foregoing provisions of this Section 1
if such activity were carried out by X. Xxxxxxx, either directly or indirectly.
(d) Limitation on Covenant. Ownership by X. Xxxxxxx, as a
passive investment, of less than one percent (1%) of the outstanding shares of
capital stock, outstanding debt instruments or other securities convertible into
capital stock or debt instruments of any corporation listed on a national
securities exchange or publicly traded on any nationally recognized
over-the-counter market shall not constitute a breach of this Section 1.
2. No Interference; Nonsolicitation. During the 5-year period
following the date of this Agreement, X. Xxxxxxx agrees that he shall not take
any action to interfere with the relationships between Buyer, Star Guide or any
Affiliate of either Buyer or Star Guide, and their respective suppliers or
customers, including, without limitation, former customers of Star Guide. During
the 5-year period following the date of this Agreement, X. Xxxxxxx agrees that
he shall not, directly or indirectly through another entity, (i) induce or
attempt to induce any employee of Buyer, Star Guide or any Affiliate of either
Buyer or Star Guide to leave the employ of Buyer, Star Guide or any Affiliate of
either Buyer or Star Guide, as applicable, (ii) hire any person who was an
employee of Buyer, Star Guide or any Affiliate of either Buyer or Star Guide if
such person was employed by Buyer, Star Guide or any Affiliate of either Buyer
or Star Guide at any time during the one-year period prior to such hiring, or
(iii) induce or attempt to induce any customer, supplier, licensee or other
business relation of Buyer, Star Guide or any Affiliate of either Buyer or Star
Guide to withdraw, curtail or cease doing business with Buyer, Star Guide or any
Affiliate of either Buyer or Star Guide, as applicable.
3. Confidential Information. Except as permitted or directed
by Buyer's or Star Guide's Board of Directors, during the 5-year period
following the date of this Agreement,
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X. Xxxxxxx agrees not to divulge, furnish or make accessible to anyone or use in
any way (other than in the ordinary course of the business of Buyer or Star
Guide if X. Xxxxxxx is an employee of either Buyer or Star Guide) any
confidential or secret knowledge or information of Buyer, Star Guide or any
Affiliate of either Buyer or Star Guide that X. Xxxxxxx has acquired or become
acquainted with prior to the date of this Agreement, whether developed by X.
Xxxxxxx or by others, concerning any trade secrets, confidential or secret
designs, processes, formulae, plans, devices or material (whether or not
patented or patentable) directly or indirectly useful in any aspect of the
business of Buyer, Star Guide or any Affiliate of either Buyer or Star Guide,
any customer or supplier lists of Buyer, Star Guide or any Affiliate of either
Buyer or Star Guide, any confidential or secret development or research work of
Buyer, Star Guide or any Affiliate of either Buyer or Star Guide, or any other
confidential information or secret aspects of the business of Buyer, Star Guide
or any Affiliate of either Buyer or Star Guide. X. Xxxxxxx acknowledges that the
above-described knowledge or information constitutes a unique and valuable asset
of Buyer and/or Star Guide, and represents a substantial investment of time and
expense by Buyer and/or Star Guide, and that any disclosure or other use of such
knowledge or information other than for the sole benefit of Buyer and/or Star
Guide would be wrongful and would cause irreparable harm to Buyer and/or Star
Guide. During such 5-year period following the date of this Agreement, X.
Xxxxxxx agrees to refrain from any acts or omissions that would reduce the value
of such knowledge or information to Buyer, Star Guide or any Affiliate of either
Buyer or Star Guide. The foregoing obligations of confidentiality shall not
apply to any knowledge or information that is now published or which
subsequently becomes generally publicly known in the form in which it was
obtained from Buyer, Star Guide or any Affiliate of either Buyer or Star Guide,
other than as a direct or indirect result of the breach of this Agreement by X.
Xxxxxxx.
4. Severability Provision. To the extent that any provision
of this Agreement shall be determined to be invalid or unenforceable, such
provision shall be deleted from this Agreement, and the validity and
enforceability of the remainder of this Agreement shall be unaffected. In
furtherance of and not in limitation of the foregoing, it is expressly agreed
that, should the duration or geographical extent of, or business activities
covered by, this Agreement be finally determined to be in excess of that which
is valid or enforceable under applicable law, such provision shall be construed
to cover the maximum duration, extent or activities which may be validly or
enforceably covered. X. Xxxxxxx acknowledges the uncertainty of the law in this
respect and expressly stipulates that this Agreement shall be construed in a
manner which renders its provisions valid and enforceable to the maximum extent
(not exceeding its express terms) possible under applicable law.
5. Remedies. X. Xxxxxxx acknowledges that it would be
difficult to fully compensate Buyer and Star Guide for damages resulting from
any breach by such party of the provisions of this Agreement. Accordingly, in
the event of any actual or threatened breach of such provisions, Buyer and Star
Guide shall (in addition to any other remedies which it may have) be entitled to
temporary and/or permanent injunctive relief to enforce such provisions, and
such relief may be granted without the necessity of proving actual damages. X.
Xxxxxxx further acknowledges that this Agreement constitutes a material
inducement to Buyer to complete the Purchase and that Buyer will be relying on
the enforceability of this Agreement in completing the Purchase.
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6. Remedies Cumulative. No remedy conferred by any of the
specific provisions of this Agreement is intended to be exclusive of any other
remedy, and each and every remedy shall be cumulative and shall be in addition
to every other remedy given hereunder or now or hereafter existing at law or in
equity or by statute or otherwise. The election of any one or more remedies by
any party hereto shall not constitute a waiver of the right to pursue other
available remedies.
7. Complete Agreement. This Agreement constitutes the entire
agreement, and supersedes all other prior and contemporaneous agreements and
undertakings, both written and oral, among the parties hereto relating to the
subject matter hereof. There are no representations, warranties, covenants,
statements, conditions, terms or obligations, other than those contained herein,
relating to the subject matter hereof. No amendments or modifications to or
variations of this Agreement shall be deemed valid unless in writing and
executed by Buyer, Star Guide and X. Xxxxxxx.
8. Governing Law. This Agreement shall be construed and
enforced in accordance with the internal laws of the State of Colorado, without
regard to conflicts of law principles.
9. Venue. Any action at law, suit in equity or judicial
proceeding arising directly, indirectly, or otherwise in connection with, out
of, related to or from this Agreement, or any provision hereof, shall be
litigated only in the state or federal courts located in Denver County,
Colorado. X. Xxxxxxx hereby consents to the jurisdiction of such courts and
waives any right to transfer or change the venue of any litigation brought
against X. Xxxxxxx by Buyer or Star Guide.
10. Assignment. X. Xxxxxxx may not assign this Agreement. The
rights of Buyer and Star Guide under this Agreement may be assigned to any third
party who succeeds to either Buyer's or Star Guide's business, as applicable.
11. Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective heirs
and personal representatives and, to the extent permitted by Section ------- 10,
their respective successors and assigns.
12. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of such
counterparts shall together constitute a single agreement.
13. Headings. Section headings contained in this Agreement are
inserted for convenience of reference only, shall not be deemed to be a part of
this Agreement for any purpose, and shall not in any way define or affect the
meaning, construction or scope of any of the provisions hereof.
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IN WITNESS WHEREOF, the parties hereto have each executed this
Agreement as of the date first written above.
BUYER:
MEDICAL DEVICE MANUFACTURING, INC.
By: /s/ XXXXX X. XXXXXX
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Name: Xxxxx X. Xxxxxx
Title: Vice President
STAR GUIDE:
By: /s/ XXXX XXXXXXX
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Name Xxxx Xxxxxxx
Title Vice President
XXXX XXXXXXX:
/s/ XXXX XXXXXXX
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Xxxx Xxxxxxx
[signature page to X. Xxxxxxx Non-Competition Agreement]
