EXHIBIT 2.2
NONCOMPETITION AGREEMENT
This Noncompetition Agreement (this "Agreement") is made as of July 31,
1998, by and among Packaged Ice, Inc. ("Buyer"), a Texas corporation and WLR
Foods, Inc., a Virginia corporation ("Seller").
PRELIMINARY STATEMENTS
Seller was the holder of all of the outstanding capital stock of Cassco
Ice & Cold Storage, Inc., a Virginia corporation (the "Company") which was
purchased by Buyer pursuant to that certain Stock Purchase Agreement dated as of
July 31, 1998 (the "Stock Purchase Agreement")
The Stock Purchase Agreement requires that Seller execute and deliver a
noncompetition agreement as a condition to the consummation of the transactions
contemplated by the Stock Purchase Agreement.
AGREEMENT
For valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties, intending to be legally bound, agree as follows:
1. ACKNOWLEDGMENTS BY SELLER.
Seller understands, acknowledges and agrees that (a) Buyer has required
that Seller make the covenants set forth in SECTIONS 2 AND 3 of this Agreement
as a condition to Buyer's purchase of the stock of the Company, (b) the
provisions of SECTIONS 2 AND 3 of this Agreement are reasonable and do not
impose a greater restraint on Seller than is necessary to protect the goodwill
or other business interest of Buyer, (c) the provisions set forth in SECTIONS 2
AND 3 are not oppressive to Seller nor injurious to the public; and (d) Buyer
would be irreparably damaged if Seller were to breach the covenants set forth in
SECTIONS 2 AND 3 of this Agreement.
2. CONFIDENTIAL INFORMATION.
Seller acknowledges and agrees that all confidential information or trade
secrets known or obtained by Seller, whether before or after the date hereof,
relating to the Company is now the property of Buyer. Therefore, Seller agrees
that it will not, at any time, disclose to any unauthorized persons or use for
its own account or for the benefit of any third party any such confidential
information or trade secrets, whether Seller has such information in its memory
or embodied in writing or other physical form, without the written consent of
Buyer, unless and to the extent that such confidential information or trade
secrets:
(i) is or becomes generally known to and available for use by the public,
other than as a result of the fault of Seller,
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(ii) becomes available to Seller on a non-confidential basis from a source
other than Buyer, provided that such source is not bound by a confidentiality
agreement or other contractual, legal or fiduciary obligation of confidentiality
to Buyer, or
(iii) Seller or any of its representatives are compelled to disclose by
judicial or administrative process or, in the opinion of Seller's counsel, by
other mandatory requirements of law.
Seller agrees to deliver to Buyer at any time Buyer may request, all
documents, memoranda, notes, plans, records, reports, and other documentation,
models, components, devices, however embodied (and all copies of all of the
foregoing, excluding Seller's personal copies of the transactional documents
related to the aforementioned Stock Purchase Agreement or other transactions
between the parties), relating to the Company that Seller may then possess or
have under its control. Seller's obligations with respect to this SECTION 2
shall terminate five years after the date of this Agreement.
3. NONCOMPETITION.
As an inducement for Buyer to enter into and consummate the Stock Purchase
Agreement and in exchange for the consideration paid to Seller under the Stock
Purchase Agreement, Seller agrees that:
(a) For a period of five years after the date hereof and within 250 miles
of any of the manufacturing, distribution or cold storage warehouse facilities
owned or leased by the Company as of the date hereof, except with respect to
that certain Warehouse Storage and Services Agreement entered into on April 1,
1998, Seller will not, directly or indirectly, engage or invest in, own, manage,
operate, finance, control or participate in the ownership, management,
operation, financing or control of, be employed by, associated with, or in any
manner connected with, lend Seller's name or any similar name to, lend Seller's
credit to, or render services or advice to, any business whose products or
activities compete in whole or in part with the products or activities of Buyer
as it relates to the production, distribution, transportation, and sale of ice
products, or the cold storage warehouse business, as of the date hereof. Seller
agrees that this covenant is reasonable with respect to its duration,
geographical area, and scope Notwithstanding the above, Seller may own, operate
or manage any cold storage warehouse in which it receives a controlling
ownership interest as a result of any acquisition by Seller of the stock or
assets of any entity engaged primarily in the poultry business, provided that
such cold storage warehouse is ancillary to such poultry business and, further
provided, that Seller's obligations under the Warehouse Storage and Services
Agreement dated April 1, 1998 are not affected; and
(b) Except as to any cold storage warehouse which Seller is allowed to
own, operate or manage pursuant to Section 3(a) above, Seller will not, directly
or indirectly, either individually or for any other person, solicit the business
of any person known to Seller to be a customer or prospective customer of Buyer
whether or not Seller had personal contact with such person, with respect to the
sale of ice products or the cold storage warehouse business.
(c) In the event of a breach by Seller of any covenant set forth in
Subsection 3(a) of this Agreement, the term of such covenant will be extended by
the period of the duration of such breach.
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4. NONSOLICITATION/NONINTERFERENCE. For a period of one (1) year after the date
hereof, neither party will, directly or indirectly, individually or for any
other person (a) solicit or attempt to solicit any employee of the other in
attempt to encourage the employee to leave the employ of such part, (b) in any
way interfere with the relationship between the other and any employee of the
other, (c) knowingly employ, or otherwise engage as an employee, independent
contractor, or otherwise any employee of the other or (d) induce or attempt to
induce any customer, supplier, licensee, or business relation of the other to
cease doing business with the other, or in any way interfere with the
relationship between any customer, supplier, licensee, or business relation of
the other. Notwithstanding the foregoing, Buyer and the company shall have the
right to hire Xxxx Xxxxxxxxx as an employee.
5. REMEDIES.
If Seller breaches the covenants set forth in SECTIONS 2 OR 3 of this
Agreement, Buyer will be entitled to the following remedies:
(a) Damages from Seller; and
(b) In addition to its right to damages and any other rights Buyer may
have, to obtain injunctive or other equitable relief to restrain any breach or
threatened breach or otherwise to specifically enforce the provisions of
SECTIONS 2 AND 3 of this Agreement, it being agreed that money damages alone may
be inadequate to compensate Buyer and would be an inadequate remedy for such
breach, and that any such breach or threatened breach will cause irreparable
injury to Buyer. Such injunction shall be available without the posting of any
bond or other security.
6. SUCCESSORS AND ASSIGNS.
This Agreement will be binding upon Seller and its respective assigns,
heirs and legal representatives and will inure to the benefit of Buyer and its
affiliates, successors and assigns. Neither this Agreement nor any rights or
obligations hereunder shall be assignable by Seller. Buyer shall have the right
to assign its rights under this Agreement to any entity which acquires all or
substantially all of the assets or stock of Buyer. For the purposes of this
Agreement, the defined term "Buyer" shall mean Packaged Ice, Inc. and all of it
subsidiaries, affiliates and successors. Buyer shall have the right to assign
this Agreement in whole or in part to any purchase of any significant portion of
the assets of Cassco Ice & Cold Storage, Inc. By way of example, and not by way
of limitation, if the Company sells any of its cold storage facilities to a
third party, the purchaser thereof shall be entitled to the benefits of this
Agreement.
7. WAIVER.
The rights and remedies of the parties to this Agreement are cumulative
and not alternative. Neither the failure nor any delay by any party in
exercising any right, power, or privilege under this Agreement will operate as a
waiver of such right, power or privilege, and no single or partial exercise of
any such right, power, or privilege will preclude any other or further exercise
of such right, power or privilege or the exercise of any other right, power or
privilege. To the maximum extent permitted by applicable law:
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(a) no claim or right arising out of this Agreement can be discharged by
one party, in whole or in part, by a waiver or renunciation of the claim or
right unless in writing and signed by the other party;
(b) no waiver that may be given by a party will be applicable except in
the specific instance for which it is given; and
(c) no notice to or demand on one party will be deemed to be a waiver of
any obligation of such party or of the right of the party giving such notice or
demand to take further action without notice or demand as provided in this
Agreement.
8. GOVERNING LAW.
This Agreement will be governed by the laws of the Commonwealth of
Virginia.
9. JURISDICTION.
The parties hereto intend to and hereby confer jurisdiction to enforce the
covenants contained in this Agreement upon the courts of any state or other
jurisdiction in which any alleged breach of any such covenant occurs. If the
courts of any of one or more of such states or other jurisdictions shall hold
such covenants not wholly enforceable by reason of the scope thereof or
otherwise, it is the intent of the parties hereto that such determination not
bar or in any way affect Buyer's right to relief provided above in the courts of
any other sates or jurisdictions as to breaches of such covenants in such other
respective states or jurisdictions, and the above covenants as they relate to
each state or jurisdiction being for this purpose, severable into diverse and
independent covenants.
10. SEVERABILITY.
Whenever possible each provision and term of this Agreement will be
interpreted in a manner to be effective and valid but if any provision or term
of this Agreement is held to be prohibited by law or invalid, then such
provision or term will be ineffective only to the extent of such prohibition or
invalidity, without invalidating or affecting in any manner whatsoever the
remainder of such provision or term or the remaining provisions or terms of this
Agreement. If any of the covenants set forth in this Agreement are held by a
court of competent jurisdiction to contain limitations as to time, geographical
area or scope of activity to be restrained that are not reasonable and impose a
greater restraint than is necessary to protect the goodwill or other business
interest of Buyer, the court shall reform the covenants to the extent necessary
to cause the limitations contained in the covenants as to time, geographical
area and scope of activity to be restrained to be reasonable and to impose a
restraint that is not greater than necessary to protect the goodwill or other
business interest of Buyer and enforce the covenants as reformed.
11. COUNTERPARTS.
This Agreement may be executed in one or more counterparts, each of which
will be deemed to be an original copy of this Agreement and all of which, when
taken together, will be deemed to constitute one and the same agreement.
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12. SECTION HEADINGS, CONSTRUCTION.
The headings of Sections in this Agreement are provided for convenience
only and will not affect its construction or interpretation. All references to
"Section" or "Sections" refer to the corresponding Section or Sections of this
Agreement unless otherwise specified. All words used in this Agreement will be
construed to be of such gender or number as the circumstances require. Unless
otherwise expressly provided, the word "including" does not limit the preceding
words or terms.
13. NOTICES.
All notices, consents, waivers and other communications under this
Agreement must be in writing and will be deemed to have been duly given when:
(a) delivered by hand (with written confirmation of receipt), (b) sent by
facsimile (with written confirmation of receipt), provided that a copy is mailed
by registered mail, return receipt requested, or (c) when received by the
addressee, if sent by a nationally recognized overnight delivery service
(receipt requested), in each case to the appropriate addresses and facsimile
numbers set forth below (or to such other addresses and facsimile numbers as a
party may designate by notice to other parties):
Seller: WLR Foods, Inc.
XX Xxx 0000
Xxxxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxxx, President, CEO
Telecopy: (000) 000-0000
With a copy to: Xxxxxxx, Aldhizer & Xxxxxx, P.L.C.
000 X. Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxx X. Xxxxx, Esquire
Telecopy: (000) 000-0000
Buyer: Packaged Ice, Inc.
0000 Xxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attn: X.X. Xxxxx, President
With a copy to: Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxx 00000
Facsimile No.: (000) 000-0000
Attn: Xxxx Xxxxxxxxxx, Esq.
14. ENTIRE AGREEMENT.
This Agreement constitutes the entire agreement between the parties with
respect to the subject matter of this Agreement. This Agreement may not be
amended except by a written agreement executed by the party to be charged with
the amendment.
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IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
as of the date first above written.
WLR FOODS, INC.
By:_________________________________
Print Name:_____________________
Print Title:_____________________
PACKAGED ICE, INC.
By:_________________________________
Print Name:_____________________
Print Title:_____________________
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