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EXHIBIT 10.2
NONCOMPETITION AGREEMENT
This Noncompetition Agreement (the "Agreement") is made and
entered into as of June 27, 1997, by and between Natural Fuels Corporation, a
Colorado corporation ("Buyer"), W. Xxxxxxx Xxxxxx ("Xxxxxx") and Xxxxxx Natural
Gas Services, Inc., a Delaware corporation ("MNG"). Xxxxxx and MNG are
sometimes referred to in this Agreement collectively as the "Noncompete
Parties" and individually as a "Noncompete Party."
RECITALS
A. Buyer and Xxxxxx Fuel Systems, Inc., DVCO Fuel
Systems, Inc. and Xxxxxx CNG Systems, Inc. (collectively, "Seller") have
entered into an Asset Purchase Agreement dated of even date (including any
amendments thereto, the "Purchase Agreement") pursuant to which Seller will
sell to Buyer, and Buyer will purchase from Seller, all of Seller's rights,
titles and interests in, to and under certain assets used in the business of
packaging and assembly of compressed natural gas vehicle fueling equipment
("Seller's Business").
B. Each Seller is a direct or indirect wholly-owned
subsidiary of MNG.
C. It is a condition precedent to the obligations of
Buyer under the Purchase Agreement that the Noncompete Parties execute and
deliver this Agreement.
AGREEMENT
In consideration of the premises and in order to induce Buyer
to execute and deliver, and to faithfully perform its obligations under, the
Purchase Agreement and in order to protect the business interests of Buyer, the
Noncompete Parties hereby covenant and agree as follows:
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1. All capitalized terms used but not defined in this
Agreement will have the same meanings ascribed to them in the Purchase
Agreement unless the context clearly mandates otherwise. In addition, the
following capitalized terms when used in this Agreement will have the meanings
set forth below:
"CNG Business Enterprise" means the sale,
manufacture, packaging, assembly or installation of compressed
natural gas vehicle fueling equipment or provision of related
design, engineering, start-up, training, technical or other
services.
"Controlled Affiliate" means an Affiliate of either
or both of the Noncompete Parties, with respect to which such
Noncompete Party possesses, directly or indirectly, the power
to direct or cause the direction of the management and
policies, whether through the ownership of voting securities
or voting interests, by contract or otherwise.
2. Each of the Noncompete Parties hereby covenants and
agrees, for itself and its Controlled Affiliates, that, for a period of four
years from and after the Closing Date, neither it nor any of its Controlled
Affiliates will, without the prior written consent of Buyer, directly or
indirectly, as a principal, agent, shareholder, investor, employer, partner,
joint venturer, manager, operator, or in any other capacity whatsoever sell,
attempt to provide, or be engaged in any CNG Business Enterprise worldwide;
provided, however, that MNG and its controlled Affiliates may (a) complete or
cause to be completed the Jobs in Progress or other work to the extent
specifically contemplated by the Purchase Agreement, (b) sell or cause to be
sold the Excluded Assets, and (c) acquire a business that derives not more
than 25% of its revenues from CNG Business Enterprises, provided MNG or such
Affiliate will (i) dispose of its interest in such acquired CNG Business
Enterprise within one year of its acquisition thereof, and (ii) grant Buyer a
right of first refusal to match the economic terms of any transaction divesting
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such acquired CNG Business Enterprise (provided the one-year divestment period
will be suspended during the negotiations with Buyer). Notwithstanding any
provisions of this Agreement to the contrary, nothing set forth herein will
prohibit Xxxxxx from (1) purchasing and holding for investment less than 5% of
the voting power, outstanding shares or other interests of any corporation,
partnership, limited liability company or other entity the shares of which are
publicly traded, or (2) serving as a member of any nonprofit committee or
organization..
3. Each of the Noncompete Parties agrees that in the
event of a breach or threatened breach of any of the provisions of this
Agreement, Buyer will have the right and remedy to have the provisions of this
Agreement specifically enforced by any court having jurisdiction, it being
acknowledged and agreed that any such breach or threatened breach will cause
immediate and irreparable injury to Buyer and that monetary damages will not
provide an adequate remedy for any such breach or threatened breach. Such
right and remedy will be in addition to, and not in lieu of, any other rights
and remedies available to Buyer at law or in equity.
4. In executing this Agreement, each of the Noncompete
Parties acknowledges that the geographic area and the time period and nature of
the agreed restrictions set forth herein are necessary and reasonable for the
protection of Buyer and have been agreed upon by arm's length negotiations.
5. If any of the provisions of or covenants contained in
this Agreement are hereafter construed to be invalid or unenforceable in any
jurisdiction, the same will not affect the remainder of the provisions or the
enforceability thereof in any other jurisdiction, which will be given full
effect, without regard to the invalid portions or the unenforceability thereof
in such other jurisdiction. If any of the provisions of or covenants contained
in this Agreement are held to be unenforceable in any jurisdiction because of
the duration or scope of such provision or
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covenant, the parties hereto agree that the court making such determination
will have the power to reduce the duration and/or scope of such provision or
covenant and, in its reduced form, such provision or covenant will be
enforceable; provided, however, that the determination of such court will not
affect the enforceability of this Agreement in any other jurisdiction.
6. The parties agree that this Agreement will be
construed in accordance with and governed by the laws of the State of Colorado.
7. This Agreement will be binding upon and inure to the
benefit of the parties and their respective heirs, executors, administrators,
successors and assigns.
8. All notices hereunder will be in writing and will be
deemed to have been given when delivered personally or by facsimile
transmission, or mailed by reputable overnight courier or by certified mail,
return receipt requested, to such party at its (or in the case of the
Noncompete Parties, at Seller's) address or telecopier number set forth for
notices in the Purchase Agreement or such other address or telecopier number as
either party may designate to the other in writing.
9. This Agreement may be executed in one or more
counterparts, and each executed copy will constitute an original.
10. This Agreement may be amended only by a written
instrument signed by the parties.
11. This Agreement constitutes the entire agreement of
the parties with respect to its subject matter.
12. The failure of Buyer to insist upon the performance,
in any instance, of this Agreement will not be construed as a waiver of any
other failure to perform. Any waiver by Buyer will be required to be in
writing.
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The undersigned parties have executed this instrument as of
the date first above written.
NATURAL FUELS CORPORATION
By: /s/ XXXXXX X. XXXXXXXXX
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Name: Xxxxxx X. Xxxxxxxxx
Title: President
/s/ W. XXXXXXX XXXXXX
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W. XXXXXXX XXXXXX
XXXXXX NATURAL GAS SERVICES, INC.
By: /s/ A. XXXXXXX XXXXXXX
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Name: A. Xxxxxxx Xxxxxxx
Title: Executive Vice President
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