EXHIBIT 2.4
NON-COMPETITION AGREEMENT
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THIS AGREEMENT is made and entered into as of May 31, 2002 (the
"Agreement"), by and between Agilisys International Limited (f/k/a High Process
Technology, Inc.), a company organized under the laws of the Cayman Islands, on
behalf of itself and each of its Affiliates ("Purchaser"), and Systems &
Computer Technology Corporation, a Delaware corporation, on behalf of itself and
each of its Affiliates ("Seller").
WHEREAS, Purchaser and its Affiliates are acquiring Seller's Global
Manufacturing & Distribution Solutions Business pursuant to that certain
Purchase Agreement dated April 10, 2002, as the same may be amended or modified
from time to time (the "Purchase Agreement"). The transactions contemplated by
the Purchase Agreement are hereinafter referred to as the "Transactions".
Capitalized terms used herein without definition shall have the respective
meanings set forth in the Purchase Agreement; and
WHEREAS, Seller understands and agrees that the Transactions will
result in an immediate and direct benefit to Seller; and
WHEREAS, upon the consummation of the Transactions, Purchaser and its
Affiliates will continue to operate the Business, which is conducted (including
distribution, promotional and marketing and sales activities) worldwide.
WHEREAS, Seller and its Affiliates possess extensive knowledge and
proprietary information with respect to the Business, which, if disclosed or
made available to the Business' competitors or used by Seller or its Affiliates
for their own account, would have a material adverse effect on the Business, and
Seller and its Affiliates have been responsible for the creation of goodwill
inherent in the Business.
WHEREAS, in light of Seller's and its Affiliates' contributions to the
growth and development of the Business, including the creation of goodwill,
Confidential Information (as defined below), and Division Intellectual Property,
in order to induce Purchaser to execute and deliver the Purchase Agreement,
Seller shall execute and deliver this Agreement for the purpose of preserving
for Purchaser's and its Affiliates' benefit the goodwill, Confidential
Information, Division Intellectual Property and going concern value of the
Business and its business opportunities. This Agreement is integral to the
Transactions and it is acknowledged and agreed that Purchaser would not enter
into the Purchase Agreement, absent Seller's execution and delivery of this
Agreement and this Agreement being in full force and effect and valid, binding
and enforceable against Seller and its Affiliates as of the closing date of the
Transactions and thereafter.
NOW, THEREFORE, the parties hereto agree as follows:
1. Non-Compete, Non-Solicitation.
(a) In order to protect the value of the assets acquired by
Purchaser and its Affiliates pursuant to the Purchase Agreement (including the
goodwill, Confidential Information and Division Intellectual Property of the
Business), Seller agrees, on behalf of itself and each of its Affiliates, that
during the period beginning as of the Closing Date and ending on the fourth
anniversary thereof (the "Noncompete Period"), neither Seller nor any of its
Affiliates shall, directly or indirectly, either for itself or for any other
Person, own, manage, control, participate in, or in any other manner engage in
any business or enterprise which competes with the Business (as it exists as of
the Closing Date) as conducted by Purchaser and its Affiliates following the
Closing Date. Seller agrees that the aforementioned covenant is reasonable with
respect to its duration, geographical area and scope.
For purposes of this Agreement,
(i) "participate" includes any direct or indirect interest in any
enterprise of any kind or nature, whether as a stockholder, partner,
representative, independent contractor, joint venturer, owner or otherwise.
(ii) Nothing herein shall be construed as restricting the right of
Seller or any of its Affiliates to (A) beneficially own, as a passive
investment, less than 5% of the outstanding voting stock or shares of non-voting
stock of any publicly traded entity or (B) acquire any business or enterprise, a
portion of which participates in the industry segment described in this Section
1(a), so long as a significant portion of such acquired business' revenues
(i.e., 10% or more) is not derived from the industry segment described in this
Section 1(a).
(b) During the 24 month period immediately following the Closing
Date, neither Seller nor any of its Affiliates shall directly or indirectly
through another Person (i) induce or attempt to induce any employee of the
Business to leave the employ of the Business or in any way interfere with the
relationship between the Business and any employee thereof, (ii) hire or employ
any person who is an employee of the Business (other than any person hired
pursuant to a general solicitation or advertisement) or (iii) make any negative
statements or communications about Purchaser or any of its Affiliates with the
intention of inducing any customer (including any subsidiaries, divisions or
affiliates thereof), supplier or other business relation of the Business to
cease doing business with the Business.
(c) During the 24 month period immediately following the Closing
Date, neither Purchaser nor any of its Affiliates shall directly or indirectly
through another Person (i) induce or attempt to induce any employee of the
Seller or its Affiliates to leave the employ of the Seller or its Affiliates or
in any way interfere with the relationship between the Seller and its Affiliates
and any employee thereof, (ii) hire or employ any person who is an employee of
the Seller or its Affiliates (other than any person hired pursuant to a general
solicitation or advertisement) or (iii) make any negative statements or
communications about Seller or any of its Affiliates with the intention of
inducing any customer (including any subsidiaries, divisions or affiliates
thereof), supplier or other business relation of the Seller or its Affiliates to
cease doing business with the Seller or its Affiliates.
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(d) Seller acknowledges that Purchaser would not consummate the
Transactions unless this Agreement shall be in full force and effect and be a
binding and enforceable contract of Seller and its Affiliates. The worldwide
geographical restriction contained in this paragraph 1 is reasonable in all
respects and necessary to protect the goodwill, Confidential Information and
Division Intellectual Property of the Business and that, without such
protection, the Business' customer and client relations and competitive
advantage would be materially adversely affected. Seller agrees that the
covenants made in paragraphs 1(a) and 1(b) shall be construed as agreements
independent of any other provision(s) of this Agreement and shall survive any
order of a court of competent jurisdiction terminating any other provision(s) of
this Agreement.
2. Confidential Information. Seller acknowledges that the information,
observations and data (including without limitation trade secrets, know-how,
research and product plans, customer lists, software, inventions, processes,
formulas, technology, designs, drawings, specifications, marketing and
advertising materials, distribution and sales methods and systems, sales and
profit figures and other technical or business information) exclusively related
to the Business ("Confidential Information") to which Seller or any of its
Affiliates had access during their ownership of the Business are the property of
the Business. Therefore, Seller, on behalf of itself and each of its Affiliates,
agrees that they shall not disclose to any unauthorized person or use for their
own purposes any Confidential Information, unless and to the extent Purchaser
has otherwise agreed in connection with any post-Closing Proprietary Rights
Agreement or other authorization or license or to the extent that the
aforementioned matters become generally known to and available for use by the
public other than as a result of Seller's or its Affiliates' acts or omissions
in violation of this Agreement or as required by law or legal process or Nasdaq
or stock market rules.
3. Enforcement. If, at the time of enforcement of paragraph 1 or 2 of
this Agreement, a court holds that the restrictions stated herein are
unreasonable under circumstances then existing, the parties hereto agree that
the maximum period, scope or geographical area reasonable under such
circumstances shall be substituted for the stated period, scope or area. Because
Seller and its Affiliates have had access to Confidential Information, and the
Division Intellectual Property, and for the other reasons set forth herein, the
parties hereto agree that money damages would not be an adequate remedy for any
breach of this Agreement. Therefore, in the event a breach or threatened breach
of this Agreement, Purchaser or any of its Affiliates may, in addition to other
rights and remedies existing in their favor, apply to any court of competent
jurisdiction for specific performance and/or injunctive or other relief in order
to enforce, or prevent any violations of, the provisions hereof (without posting
a bond or other security). In addition, in the event of an alleged breach or
violation by Seller or its Affiliates of paragraph 1, the Noncompete Period
shall be tolled until such breach or violation has been duly cured.
4. Notices. Any notice provided for in this Agreement shall be in
writing and shall be either personally delivered, mailed by first class mail
(return receipt requested), or sent by overnight courier service or via
facsimile to the recipient at the address indicated below:
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Notices to Seller:
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Systems & Computer Technology Corporation
Great Valley Corporate Center
Four Xxxxxx Xxxx Xxxx
Xxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxxxxx
Facsimile: (000) 000-0000
With a copy to:
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Xxxxxx Xxxxxxxx LLP
0000 Xxx Xxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attention: Xxxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000
Notices to Purchaser:
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Agilisys International Limited
c/o Golden Gate Capital Private Equity, Inc.
Xxx Xxxxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxxx Xxxx
Facsimile: (000) 000-0000
With a copy to:
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Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx, P.C.
Xxxx Xxxxxxx
Facsimile: (000) 000-0000
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement shall be deemed to have been given when so delivered
or mailed.
5. Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision or any other jurisdiction, but this Agreement shall be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
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6. Complete Agreement. This Agreement, those documents expressly
referred to herein and other documents of even date herewith embody the complete
agreement and understanding among the parties and supersede and preempt any
prior understandings, agreements or representations by or among the parties,
written or oral, which may have related to the subject matter hereof in any way
provided, that in the event any provision of this Agreement and the Purchase
Agreement are in conflict, the provisions of the Purchase Agreement shall
prevail.
7. No Strict Construction. The language used in this Agreement shall be
deemed to be the language chosen by the parties hereto to express their mutual
intent, and no rule of strict construction shall be applied against any party.
8. Counterparts. This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement (any one of which may be executed
and delivered via facsimile).
9. Successors and Assigns; Parties in Interest. This Agreement is
intended to bind and inure to the benefit of and be enforceable by the parties
hereto and their respective Affiliates and their respective successors and
assigns, except that neither Seller nor its Affiliates may assign their rights
or delegate their obligations hereunder without the prior written consent of
Purchaser (which consent may be withheld in Purchaser's sole discretion).
10. Choice of Law. All issues and questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall
be governed by, and construed in accordance with, the laws of the State of New
York, without giving effect to any choice of law or conflict of law rules or
provisions (whether of the State of New York or any other jurisdiction) that
would cause the application of the laws of any jurisdiction other than the State
of New York.
11. Amendment and Waiver. The provisions of this Agreement may be
amended or waived only with the prior written consent of Seller and Purchaser
and no course of conduct or failure or delay in enforcing the provisions of this
Agreement shall affect the validity, binding effect or enforceability of this
Agreement.
12. Recitals. The recitals to this Agreement are an integral part of
this Agreement and shall be deemed to be part of the text of this Agreement as
if fully set forth herein.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.
Agilisys International Limited (f/k/a High Process
Technology, Inc.)
By: /s/ Xxxxx Xxxxxxx
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Name: Xxxxx Xxxxxxx
Its: Director
SYSTEMS & COMPUTER TECHNOLOGY CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxxxx
Its: Sr. Vice President and
General Counsel
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