EXHIBIT 10.12
NONCOMPETITION AGREEMENT
Noncompetition Agreement (the "Agreement") dated as of December 10,
1993 by and among The British Petroleum p.l.c., an English Company ("BP"), and
TA Operating Corporation, a Delaware corporation ("Buyer").
RECITALS
WHEREAS, BP's subsidiaries, BP Exploration & Oil, Inc., an Ohio
corporation ("BP E&O"), and Truckstops Corporation of America Inc., a Delaware
corporation ("TA" and together with BP E&O, the "Sellers"), have been engaged in
the business of owning and operating a national auto/truckstop network (the
"Business");
WHEREAS, in connection with the Business the Sellers sell gasoline,
petroleum distillates and other petroleum products and related goods and
services to trucks operating throughout the United States, including certain
national and regional fleet customers;
WHEREAS, pursuant to that certain Asset Purchase Agreement, dated as
of July 22, 1993, by and among Sellers and Buyer (as such agreement may be
amended from time to time, the "Asset Purchase Agreement"), Buyer is acquiring
(the "Acquisition") on the date hereof from Sellers the goodwill and
substantially all of the assets of the Business;
WHEREAS, Buyer would not have entered into the Asset Purchase
Agreement if BP had not agreed to execute this Noncompetition Agreement;
WHEREAS, Buyer intends to carry on the Business formerly conducted
by Sellers;
WHEREAS, the goodwill of the Business would be adversely affected if
any member of the BP Group (including, without limitation, the Sellers) were to
compete with Buyer in the Business; and
WHEREAS, BP understand and acknowledges that its execution and
delivery of this Agreement is a material inducement and condition precedent to
the consummation of the Acquisition.
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants and agreements set forth
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herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby covenant and
agree as follows:
1. CERTAIN DEFINITIONS. For purposes of this Agreement, the
following terms shall have the meanings set forth below.
"Affiliate" means, with respect to any Person, any other Person
controlling, controlled by or under common control with such Person.
"BP Group" means The British Petroleum Company p.l.c. and its direct
and indirect subsidiaries (subsidiary means direct or indirect ownership of 50%
or more of the voting power of such person).
"Jobber Truckstop Facility" means a Truckstop Facility that is owned
or operated by a Person, other than a member of the BP Group, who is authorized
to sell motor fuel in connection with the Marks.
"Marks" mean, collectively, the servicemark and the trademark "BP".
"Person" means any individual, corporation, partnership, joint
venture, association, trust, unincorporated organization or government or other
agency or political subdivision thereof.
"Truck" means any motor vehicle with more than two (2) axles.
"Territory" means the United States of America, including each and
every county, city and other political subdivision thereof. The parties hereto
agree that this definition of "Territory" shall be deemed to include each and
every county located in the Territory as if fully set forth herein.
"Truckstop Facility" means any facility, whether now in existence or
constructed in the future, wherever located, that (A) derives a majority of its
motor fuel revenues from the sale of motor fuel for use by Trucks and (B)
derives a material portion of its revenues from the sale of motor fuel for use
by Trucks and (C) is located within two miles of an interstate highway.
Notwithstanding the foregoing, a facility in existence on the date hereof which
currently sells BP branded motor fuel shall not be deemed to be a Truckstop
Facility.
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2. NONCOMPETITION.
(a) For a period of seven (7) years commencing on the date
hereof (the "Term"), without the prior written approval of Buyer, no entity
within the BP Group will (i) own, manage, control, operate or franchise any
Truckstop Facility located in the Territory or (ii) license, franchise or
otherwise authorize any Person (other than Buyer and its licensees) to own,
operate, control or manage a Truckstop Facility under any of the Marks (or sell
any motor fuel in connection with the Marks at any Truckstop Facility located in
the Territory), where, in the case of this clause (ii), such Truckstop Facility
is located either within twenty-five (25) miles or within two (2) interstate
interchanges of one of the eighteen (18) BP-branded truckstop facilities Buyer
is acquiring from Sellers (the "BP-Branded Buyer Truckstop"), a list of which is
set forth on the attached Schedule 1. If a BP-Branded Buyer Truckstop ceases
using the Marks, it will thereafter no longer be deemed to be a BP-Branded Buyer
Truckstop.
(b) Notwithstanding anything in Section 2(a) to the contrary:
(i) the BP Group may consummate (by merger,
consolidation, stock purchase, asset acquisition or otherwise) an acquisition of
the business or assets of any Person (the "Acquired Person"); PROVIDED, that (w)
the principal business of the Acquired Person does not consist of the ownership,
operation, management, franchising or leasing of Truckstop Facilities or the
provision of services or the sale of goods to Trucks or Truck drivers; (x) in
the one year period preceding such acquisition a majority of the consolidated
revenues of the Acquired Person were not derived from the provision of services
or the sale of goods to Trucks or Truck drivers; (y) the number of Truckstop
Facilities owned, operated, managed, franchised or leased by the Acquired Person
does not increase above the number of Truckstop Facilities owned, operated,
managed or leased by the Acquired Person on the date of such acquisition; and
(z) none of the Marks are utilized in connection with the sale of motor fuel at
any Truckstop Facilities owned, operated, managed, franchised or leased by the
Acquired Person;
(ii) in the event of any sale of BP E&O (whether by
merger, consolidation, sale of stock, sale of assets or otherwise) to another
Person (the "Acquiring Person"), the Acquiring Person shall not be bound (but
the BP Group shall continue to be bound) by the provisions of Section 2(a)
hereof; PROVIDED, that prior to consummation of such sale, the Sellers shall
cause the Acquiring Person to expressly agree to not utilize any of the Marks in
any way
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in connection with the sale of motor fuel at any Truckstop Facility then or
thereafter owned, operated, managed or leased, directly or indirectly, by the
Acquiring Person; and
(iii) the BP Group may freely license, franchise or
otherwise authorize any Person (other than a member of the BP Group) to own,
operate, control or manage a Jobber Truckstop Facility, and/or to sell motor
fuel in connection with the Marks at a Jobber Truckstop Facility, provided, that
such Jobber Truckstop Facility is neither within twenty-five (25) miles of the
nearest BP-Branded Buyer Truckstop nor is within two interstate interchanges of
the nearest BP-Branded Buyer Truckstop.
3. NONSOLICITATION. During the two year period commencing on the
date hereof, no entity within the BP Group will, directly or indirectly, either
for its own account or for the account of any other Person, solicit, entice,
persuade, induce or attempt to solicit, entice, persuade or induce any
headquarters employee (other than secretaries or other employees with job levels
the same or lower than a secretary's job level) of the Buyer, National
Auto/Truckstops Holdings Corporation ("Holdings") or National Auto/Truckstops,
Inc. ("National") to terminate, alter or refrain from extending or renewing any
contractual or other relationship of such employee with the Buyer, Holdings or
National; PROVIDED, HOWEVER, that nothing in this Section 3 shall prohibit any
member of the BP Group from engaging in any form of generalized advertising that
does not directly target or involve the direct solicitation of any employee of
the Buyer, Holdings or National.
4. PAYMENT. Buyer agrees to pay BP by direct authenticated transfer
to BP's account with Citibank, N.A., New York, A.B.A.# 0000-0000-0 for credit to
Account No. 00000000 the sum of Nine Million United States Dollars
(US$9,000,000) on the Closing Date. Such Nine Million United States Dollar
payment shall be deemed a part of the purchase price to be paid by Buyer to BP
on the Closing Date pursuant to the Asset Purchase Agreement. Such payment will
be made without any deduction or withholding for or on account of any tax.
5. REPRESENTATIONS. BP has provided Buyer with a copy of its Form
1001 (attached as Schedule 2) relating to this Agreement. BP represents that (a)
it is fully eligible for the benefits of the "Other Income" provisions of
Article 5 of the U.S.-U.K. Income Tax Convention (the "Treaty"), with respect to
any payment described in Section 4 hereof and received or to be received by it
in connection with this Agreement, and (b) no such payment is attributable to a
trade or business carried on by it through a permanent establishment in the
Untied States, as defined in Article 5
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of the Treaty. BP agrees to indemnify and hold the Buyer harmless from all
costs, penalties, expenses or withholding tax subsequently imposed as a result
of the Buyer's payments to BP under this Agreement or the Purchase Agreement.
6. SEVERABILITY; SEPARATE COVENANTS. If any provision of this
Agreement shall be invalid or unenforceable for any reason and to any extent,
the remainder of this Agreement shall not be affected thereby, but shall be
enforced to the greatest extent permitted by law. Without limiting the
generality of the foregoing, the covenants contained in this Agreement shall be
deemed to consist of a series of separate covenants, one for each state included
within the Territory. Sellers expressly acknowledge and agree that the
character, duration and geographic scope of the covenants contained in this
Agreement are reasonable in light of the circumstances as they exist on the date
hereof. However, should a determination nonetheless be made by a court or
arbitrator at a later date that the character, duration or geographic scope of
the covenants contained in this Agreement is unreasonable in light of the
circumstances as they then exist, then it is the intention and the agreement of
the parties that this Agreement shall be construed by the court or arbitrator
(as applicable) in such a manner as to impose only those restrictions on the
conduct of Sellers which are reasonable in light of the circumstances as they
then exist and as are necessary to assure Buyer of the intended benefit of this
Agreement. If, in any judicial proceeding, a court or arbitrator (as applicable)
shall refuse to enforce all of the separate covenants deemed included herein
because, taken together, they are more extensive than necessary to assure Buyer
of the intended benefit of this Agreement, it is expressly understood and agreed
between the parties hereto that those of such covenants which, if eliminated,
would permit the remaining separate covenants to be enforced in such proceeding
shall, for the purpose of such proceeding, be deemed eliminated from the
provisions hereof.
7. ENFORCEMENT OF COVENANTS. The existence of any claim or cause of
action of Sellers or any of their Affiliates and entities in which it may be a
joint venturer or a partner against either Buyer or any other Person, whether
predicated on this Agreement, the Asset Purchase Agreement or otherwise, shall
not constitute a defense to the enforcement by Buyer of the covenants and
agreements contained herein.
8. SUCCESSORS AND ASSIGNS. Buyer shall have the right to assign any
or all of its rights and obligations hereunder to any of Buyer's Affiliates or
lenders, or to any successor in interest of Buyer whether by merger, xxxxxxx-
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dation, purchase of assets, dissolutions, liquidation or otherwise.
9. GOVERNING LAW. This Agreement shall be governed by the laws of
the State of New York without regard to the conflict of laws principles thereof.
10. AMENDMENT. This Agreement may be modified or amended only by a
written instrument duly executed by each party hereto.
11. WAIVER. No breach of any covenant, agreement, warranty or
representation shall be deemed waived unless expressly waived in writing by the
party who might assert such breach. No waiver of any right hereunder shall
operate as a continuing waiver or as a waiver of any other right or of the same
or a similar right on another occasion. No failure or delay by Buyer in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof by Buyer, nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege of Buyer.
12. ENTIRE AGREEMENT. This Agreement, together with the Asset
Purchase Agreement, contains the entire understanding of the parties with
respect to the subject matter hereof and supersedes all prior agreements and
understandings relating to the subject matter hereof.
13. HEADINGS. The headings of each section of this Agreement are for
convenience of reference only and shall not limit, control or otherwise affect
in any way, the meaning thereof.
14. COUNTERPARTS. This Agreement may be executed by the parties in
separate counterparts, each of which when
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so executed and delivered shall be an original for all purposes, but all such
counterparts shall together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Noncompetition Agreement to be executed by their respective authorized
representatives as of the date first above written.
THE BRITISH PETROLEUM COMPANY P.L.C.
By: /s/ Xxxxx X. Xxxxx
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Name: Xxxxx X. Xxxxx
Title: Vice President
TA OPERATING CORPORATION
By: /s/ Rowan X.X. Xxxxxx
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Name: Rowan X.X. Xxxxxx
Title: Vice President &
Assistant Secretary
