NON-COMPETITION AGREEMENT
This Non-Competition Agreement (this "Agreement") is entered into as of
the 1st day of September, 1999 (the "Effective Date"), by Xxxxx X. Xxxxxxx, M.D.
(the "Equity Holder"), who is an equity owner of Barnet Xxxxxxx Eye Center,
P.L.L.C., an Arizona professional limited liability company ("BDEC"), and LASIK
Investors, L.L.C., a Delaware limited liability company ("LASIK"), for the
benefit of Prime Medical Services, Inc., a Delaware corporation ("PMSI"), Prime
Medical Operating, Inc., a Delaware corporation ("Prime"), Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Newco I"),
Prime/BDEC Acquisition, L.L.C., a Delaware limited liability company ("Newco
II"), BDEC, LASIK, Xxxxxx X. Xxxxxx, M.D. ("Barnet"), Xxxxx X. Xxxxxxx, M.D.
("Xxxxxxx") and Xxxx Xxxxxxxxx ("Xxxxxxxxx") (PMSI, Prime, Newco I, Newco II,
BDEC, LASIK, Barnet, Xxxxxxx and Xxxxxxxxx are referred to herein individually
as a "Beneficiary" and collectively as "Beneficiaries").
RECITALS:
WHEREAS, the Equity Holder is an equity owning member of BDEC and
LASIK.
WHEREAS, concurrently with the execution and delivery of this
Agreement, Newco I, Newco II, Prime, PMSI, BDEC, LASIK, Barnet, Dulaney, and
Xxxxxxxxx are consummating that certain Contribution Agreement (the
"Contribution Agreement"), dated effective September 1, 1999.
WHEREAS, in order to induce each of the Beneficiaries to consummate the
transactions contemplated by the Contribution Agreement, the Equity
Holder has agreed to certain restrictions on the activities of Equity
Holder and his Affiliates (as hereinafter defined), which restrictions
the Equity Holder deems reasonable and appropriate. THEREFORE, the
parties hereto agree as follows:
AGREEMENTS:
1. Confidentiality Agreement. Equity Holder acknowledges that through
his relationship with BDEC and LASIK, he will be exposed to Proprietary
Information (as defined below) of Newco I, Newco II and/or each of their present
or future affiliates (which includes, without limitation, BDEC, LASIK, Prime,
PMSI and each of their present or future affiliates) (the party owning such
Proprietary Information is referred to as the "Discloser"), that such
Proprietary Information is unique and valuable and that such Discloser would
suffer irreparable injury if its Proprietary Information were divulged to those
in competition with Discloser. "Proprietary Information" shall be all
information concerning Discloser which Equity Holder acquires, or to which he
has access through his relationship with BDEC or LASIK, that has not been
publicly disclosed by Discloser or that is not a matter of common knowledge
among Discloser's competitors, including, but not limited to, information
relating to any inventions, processes, software, formulae, plans, devices,
compilations of information, technical data, mailing lists, management
strategies, business distribution methods, names of suppliers (of both goods and
services) and customers, names of employees and terms of employment,
arrangements entered into with suppliers and customers, including, but not
limited to, proposed expansion plans of Discloser, marketing and other business
and pricing strategies, and trade secrets of Discloser. Notwithstanding the
foregoing, Proprietary Information shall not include information or material
that would otherwise be Proprietary Information if such information or material
is owned solely by BDEC and not materially used or relied on in the conduct of
the Business (as defined in the Contribution Agreement).
Except with prior written approval of Discloser, Equity Holder agrees
that he will not, at any time after the Closing, as such term is defined in
the Contribution Agreement: (i) directly or indirectly, disclose any
Proprietary Information to any person except the employees, agents and
consultants of Newco I, Newco II and/or Discloser who need to know such
Proprietary Information in connection with their relationship with Newco I
or Newco II nor (ii) use Proprietary Information in any way, except for the
purposes and benefit of Newco I or Newco II.
Within forty-eight (48) hours of termination of his ownership of BDEC
and LASIK, whether voluntary or involuntary, Equity Holder will deliver to the
appropriate Discloser (without retaining copies thereof) all documents, records
or other memorializations including copies of documents and any notes which he
has prepared that contain Proprietary Information, all other tangible
Proprietary Information in his possession or control and all of Discloser's
credit cards, keys, equipment, vehicles, supplies and other materials that are
in his possession or under his control.
2. Non-Competition Agreement. Equity Holder, hereby agrees that, at all
times during which the provisions of ARTICLE VIII of the Contribution Agreement
are in effect, and at all times until five (5) years after either LASIK and its
affiliates (excluding PMSI, Prime, and the subsidiaries of either of them), or
Prime and its affiliates (excluding LASIK), no longer own any equity or other
interest in Newco I, Equity Holder will not directly or indirectly, either
through any kind of ownership (other than ownership of securities of a publicly
held corporation of which he owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
advisor, consultant, co-partner or in any individual or representative capacity
whatever, either for his own benefit or for the benefit of any other person,
corporation or other entity, without the prior written consent of each
Beneficiary, commit any of the following acts, which acts shall be considered
violations of this covenant not to compete:
(a) Except through Newco I or its subsidiaries, or Newco II,
directly or indirectly engage in, or provide, anywhere within a fifty (50) mile
radius of any center or facility that provides Refractive Surgery (as defined in
the Contribution Agreement) and is owned, directly or indirectly, partially or
wholly, by Newco I or a subsidiary of Newco I (collectively, the "Restricted
Area"), any services (other than services included in the practice of medicine)
related to (i) the operating of centers or facilities that provide Refractive
Surgery, (ii) the manufacture, maintenance, refurbishing, repair, sale, or
leasing of any equipment related to or necessary for the operating of centers or
facilities that provide Refractive Surgery, or (iii) providing any management
services, training or consulting services related to any of the activities
described in (i) or (ii);
(b) Except through Newco I or its subsidiaries, or Newco II,
directly or indirectly provide, anywhere within the Restricted Area, (i)
facilities, equipment and non-physician personnel for the performance by
physicians of Refractive Surgery, (ii) the marketing, scheduling and management
of Refractive Surgery (but excluding marketing, scheduling and management of
patients for treatment by Equity Holder), (iii) the credentialing and scheduling
of physicians to perform Refractive Surgery and (iv) the billing, collecting or
accounting for the use of any such facilities, equipment or non-physician
personnel;
(c) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Newco I or any of its subsidiaries, Prime, LASIK, BDEC, Barnet, Dulaney,
Rosenberg, or any affiliate or related entity of any of them, to withdraw,
curtail, or cancel its business with such person or entity; or
(d) Directly or indirectly hire any employee of Newco I or any of its
subsidiaries, Prime, LASIK, BDEC, Barnet, Dulaney, Rosenberg, or any
affiliate or related entity of any of them, or induce or attempt to
influence any employee of Newco I or any of its subsidiaries, Prime, LASIK,
BDEC, Barnet, Dulaney, Rosenberg, or any such affiliate or related entity
to terminate his or her employment with such person or entity.
3. Exclusivity. Equity Holder acknowledges that any acquisition or
development of a Target Center (as defined in the Contribution Agreement)
by Equity Holder through an entity not owned (wholly or partially, directly
or indirectly) by Newco I shall be subject to the provisions of Section 2
of this Agreement, regardless of whether such acquisition or development is
contemplated by or provided for in the provisions of ARTICLE VIII of the
Contribution Agreement.
4. Agreement. Equity Holder has reviewed and carefully considered the
provisions of Sections 1 and 2 of this Agreement and, having done so,
agrees that the restrictions applicable to him as set forth therein (a) are
fair and reasonable with respect to time, geographic area and scope, (b)
are not unduly burdensome to him, and (c) are reasonably required for the
protection of the interests of the Beneficiaries for whose benefit such
restrictions were agreed upon.
5. Remedies. Equity Holder agrees that a violation on his part of any
applicable covenant contained in Sections 1 or 2 of this Agreement will
cause the Beneficiaries, for whose benefit such restrictions were agreed
upon, irreparable damage for which remedies at law may be insufficient, and
for that reason, he agrees that any of the Beneficiaries shall be entitled
as a matter of right to equitable remedies, including specific performance
and injunctive relief, therefor. The right to specific performance and
injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the Beneficiaries may have, including,
specifically, recovery of additional damages.
6. Affiliates. For purposes of this Agreement, an "Affiliate" of Equity
Holder means any person married to, or any minor child of, Equity Holder and any
corporation, partnership or other entity that, at the date hereof or at any time
during the term hereof, is controlled by, or under common control with, Equity
Holder. "Control" (and its derivatives), in this context, means the possession
of, directly or indirectly, the power to direct or cause the direction of the
management of the applicable corporation, partnership or other entity either
through the ownership of voting securities (or other equity interests), by
contract, or by ownership of a membership of a nonstock corporation or other
entity enabling Equity Holder to elect one or more members of the governing
board of that nonstock corporation or other entity.
7. Control of Affiliates' Actions. Equity Holder will timely exercise
all of his rights and powers to cause each of his Affiliates to comply with
the terms of this Agreement. ------------------------------
8. Indemnity. Equity Holder agrees to indemnify, defend and hold each
Beneficiary harmless from and against any and all loss, damage, cost and
expense (including attorneys' fees) that may result from any breach or
threatened breach of this Agreement by Equity Holder or any Affiliate of
Equity Holder. ---------
9. Miscellaneous.
(a) Amendments. This Agreement may be modified or amended only by an
instrument in writing executed by Equity Holder and each Beneficiary.
(b) Headings. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. (c) Governing
Law. This Agreement shall be construed and enforced in
accordance with the internal laws of the State of Texas, and
not the conflicts of law provisions thereof.
(d) Parties Bound. This Agreement shall be binding upon and be
enforceable against the Equity Holder and Equity Holder's Affiliates, and
their respective successors and representatives. This Agreement shall inure
to the benefit of each Beneficiary and their respective successors,
representatives and assigns. -------------
(e) Invalid Provisions. If any provision of this Agreement
(including, without limitation, any provision relating to the activities covered
by, or time period of, the covenants contained in Section 2 of this Agreement)
is held to be illegal, invalid or unenforceable under present or future laws
effective during the term hereof, such provision shall be fully severable; this
Agreement shall be construed and enforced as if such illegal, invalid or
unenforceable provision had never comprised a part hereof; and the remaining
provisions shall remain in full force and effect and shall not be affected by
the illegal, invalid or unenforceable provision or by its severance herefrom.
Furthermore, in lieu of such illegal, invalid or unenforceable provision, there
shall be added automatically as a part of this Agreement a provision as similar
in terms to such illegal, invalid or unenforceable provision as may be possible
and be legal, valid and enforceable.
(f) Construction. This Agreement shall be construed without regard to
the identity of the person who drafted the various provisions of this
Agreement. Each and every provision of this Agreement shall be construed as
though all of the parties participated equally in the drafting of this
Agreement. Consequently, Equity Holder acknowledges and agrees that any
rule of construction that a document is to be construed against the
drafting party shall not be applicable to this Agreement. ------------
(g) Defined Terms. Any capitalized terms not otherwise defined in this
Agreement shall have the same meaning as set forth in the Contribution
Agreement. -------------
[Signature page follows]
SIGNATURE PAGE TO
NON-COMPETITION AGREEMENT
EXECUTED to be effective as of the date first above written.
EQUITY HOLDER: /s/Xxxxx X. Xxxxxxx, M.D.
Xxxxx X. Xxxxxxx, M.D.
NON-COMPETITION AGREEMENT
This Non-Competition Agreement (this "Agreement") is entered into as of
the 1st day of September, 1999 (the "Effective Date"), by Xxxxxx X. Xxxxxxx,
O.D. (the "Equity Holder"), who is an equity owner of Barnet Xxxxxxx Eye Center,
P.L.L.C., an Arizona professional limited liability company ("BDEC"), and LASIK
Investors, L.L.C., a Delaware limited liability company ("LASIK"), for the
benefit of Prime Medical Services, Inc., a Delaware corporation ("PMSI"), Prime
Medical Operating, Inc., a Delaware corporation ("Prime"), Prime/BDR
Acquisition, L.L.C., a Delaware limited liability company ("Newco I"),
Prime/BDEC Acquisition, L.L.C., a Delaware limited liability company ("Newco
II"), BDEC, LASIK, Xxxxxx X. Xxxxxx, M.D. ("Barnet"), Xxxxx X. Xxxxxxx, M.D.
("Xxxxxxx") and Xxxx Xxxxxxxxx ("Xxxxxxxxx") (PMSI, Prime, Newco I, Newco II,
BDEC, LASIK, Barnet, Xxxxxxx and Xxxxxxxxx are referred to herein individually
as a "Beneficiary" and collectively as "Beneficiaries").
RECITALS:
WHEREAS, the Equity Holder is an equity owning member of BDEC and
LASIK.
WHEREAS, concurrently with the execution and delivery of this
Agreement, Newco I, Newco II, Prime, PMSI, BDEC, LASIK, Barnet, Dulaney, and
Xxxxxxxxx are consummating that certain Contribution Agreement (the
"Contribution Agreement"), dated effective September 1, 1999.
WHEREAS, in order to induce each of the Beneficiaries to consummate the
transactions contemplated by the Contribution Agreement, the Equity
Holder has agreed to certain restrictions on the activities of Equity
Holder and his Affiliates (as hereinafter defined), which restrictions
the Equity Holder deems reasonable and appropriate. THEREFORE, the
parties hereto agree as follows:
AGREEMENTS:
1. Confidentiality Agreement. Equity Holder acknowledges that through
his relationship with BDEC and LASIK, he will be exposed to Proprietary
Information (as defined below) of Newco I, Newco II and/or each of their present
or future affiliates (which includes, without limitation, BDEC, LASIK, Prime,
PMSI and each of their present or future affiliates) (the party owning such
Proprietary Information is referred to as the "Discloser"), that such
Proprietary Information is unique and valuable and that such Discloser would
suffer irreparable injury if its Proprietary Information were divulged to those
in competition with Discloser. "Proprietary Information" shall be all
information concerning Discloser which Equity Holder acquires, or to which he
has access through his relationship with BDEC or LASIK, that has not been
publicly disclosed by Discloser or that is not a matter of common knowledge
among Discloser's competitors, including, but not limited to, information
relating to any inventions, processes, software, formulae, plans, devices,
compilations of information, technical data, mailing lists, management
strategies, business distribution methods, names of suppliers (of both goods and
services) and customers, names of employees and terms of employment,
arrangements entered into with suppliers and customers, including, but not
limited to, proposed expansion plans of Discloser, marketing and other business
and pricing strategies, and trade secrets of Discloser. Notwithstanding the
foregoing, Proprietary Information shall not include information or material
that would otherwise be Proprietary Information if such information or material
is owned solely by BDEC and not materially used or relied on in the conduct of
the Business (as defined in the Contribution Agreement).
Except with prior written approval of Discloser, Equity Holder agrees
that he will not, at any time after the Closing, as such term is defined in
the Contribution Agreement: (i) directly or indirectly, disclose any
Proprietary Information to any person except the employees, agents and
consultants of Newco I, Newco II and/or Discloser who need to know such
Proprietary Information in connection with their relationship with Newco I
or Newco II nor (ii) use Proprietary Information in any way, except for the
purposes and benefit of Newco I or Newco II.
Within forty-eight (48) hours of termination of his ownership of BDEC
and LASIK, whether voluntary or involuntary, Equity Holder will deliver to the
appropriate Discloser (without retaining copies thereof) all documents, records
or other memorializations including copies of documents and any notes which he
has prepared that contain Proprietary Information, all other tangible
Proprietary Information in his possession or control and all of Discloser's
credit cards, keys, equipment, vehicles, supplies and other materials that are
in his possession or under his control.
2. Non-Competition Agreement. Equity Holder, hereby agrees that, at all
times during which the provisions of ARTICLE VIII of the Contribution Agreement
are in effect, and at all times until five (5) years after either LASIK and its
affiliates (excluding PMSI, Prime, and the subsidiaries of either of them), or
Prime and its affiliates (excluding LASIK), no longer own any equity or other
interest in Newco I, Equity Holder will not directly or indirectly, either
through any kind of ownership (other than ownership of securities of a publicly
held corporation of which he owns less than five percent (5%) of any class of
outstanding securities), or as a principal, shareholder, agent, employer,
advisor, consultant, co-partner or in any individual or representative capacity
whatever, either for his own benefit or for the benefit of any other person,
corporation or other entity, without the prior written consent of each
Beneficiary, commit any of the following acts, which acts shall be considered
violations of this covenant not to compete:
(a) Except through Newco I or its subsidiaries, or Newco II,
directly or indirectly engage in, or provide, anywhere within a fifty (50) mile
radius of any center or facility that provides Refractive Surgery (as defined in
the Contribution Agreement) and is owned, directly or indirectly, partially or
wholly, by Newco I or a subsidiary of Newco I (collectively, the "Restricted
Area"), any services (other than services included in the practice of medicine)
related to (i) the operating of centers or facilities that provide Refractive
Surgery, (ii) the manufacture, maintenance, refurbishing, repair, sale, or
leasing of any equipment related to or necessary for the operating of centers or
facilities that provide Refractive Surgery, or (iii) providing any management
services, training or consulting services related to any of the activities
described in (i) or (ii);
(b) Except through Newco I or its subsidiaries, or Newco II,
directly or indirectly provide, anywhere within the Restricted Area, (i)
facilities, equipment and non-physician personnel for the performance by
physicians of Refractive Surgery, (ii) the marketing, scheduling and management
of Refractive Surgery (but excluding marketing, scheduling and management of
patients for treatment by Equity Holder), (iii) the credentialing and scheduling
of physicians to perform Refractive Surgery and (iv) the billing, collecting or
accounting for the use of any such facilities, equipment or non-physician
personnel;
(c) Directly or indirectly request or advise any person, firm,
physician, corporation or other entity having a business relationship with
Newco I or any of its subsidiaries, Prime, LASIK, BDEC, Barnet, Dulaney,
Rosenberg, or any affiliate or related entity of any of them, to withdraw,
curtail, or cancel its business with such person or entity; or
(d) Directly or indirectly hire any employee of Newco I or any of its
subsidiaries, Prime, LASIK, BDEC, Barnet, Dulaney, Rosenberg, or any
affiliate or related entity of any of them, or induce or attempt to
influence any employee of Newco I or any of its subsidiaries, Prime, LASIK,
BDEC, Barnet, Dulaney, Rosenberg, or any such affiliate or related entity
to terminate his or her employment with such person or entity.
3. Exclusivity. Equity Holder acknowledges that any acquisition or
development of a Target Center (as defined in the Contribution Agreement)
by Equity Holder through an entity not owned (wholly or partially, directly
or indirectly) by Newco I shall be subject to the provisions of Section 2
of this Agreement, regardless of whether such acquisition or development is
contemplated by or provided for in the provisions of ARTICLE VIII of the
Contribution Agreement.
4. Agreement. Equity Holder has reviewed and carefully considered the
provisions of Sections 1 and 2 of this Agreement and, having done so,
agrees that the restrictions applicable to him as set forth therein (a) are
fair and reasonable with respect to time, geographic area and scope, (b)
are not unduly burdensome to him, and (c) are reasonably required for the
protection of the interests of the Beneficiaries for whose benefit such
restrictions were agreed upon.
5. Remedies. Equity Holder agrees that a violation on his part of any
applicable covenant contained in Sections 1 or 2 of this Agreement will
cause the Beneficiaries, for whose benefit such restrictions were agreed
upon, irreparable damage for which remedies at law may be insufficient, and
for that reason, he agrees that any of the Beneficiaries shall be entitled
as a matter of right to equitable remedies, including specific performance
and injunctive relief, therefor. The right to specific performance and
injunctive relief shall be cumulative and in addition to whatever other
remedies, at law or in equity, that the Beneficiaries may have, including,
specifically, recovery of additional damages.
6. Affiliates. For purposes of this Agreement, an "Affiliate" of Equity
Holder means any person married to, or any minor child of, Equity Holder and any
corporation, partnership or other entity that, at the date hereof or at any time
during the term hereof, is controlled by, or under common control with, Equity
Holder. "Control" (and its derivatives), in this context, means the possession
of, directly or indirectly, the power to direct or cause the direction of the
management of the applicable corporation, partnership or other entity either
through the ownership of voting securities (or other equity interests), by
contract, or by ownership of a membership of a nonstock corporation or other
entity enabling Equity Holder to elect one or more members of the governing
board of that nonstock corporation or other entity.
7. Control of Affiliates' Actions. Equity Holder will timely exercise
all of his rights and powers to cause each of his Affiliates to comply with
the terms of this Agreement. ------------------------------
8. Indemnity. Equity Holder agrees to indemnify, defend and hold each
Beneficiary harmless from and against any and all loss, damage, cost and
expense (including attorneys' fees) that may result from any breach or
threatened breach of this Agreement by Equity Holder or any Affiliate of
Equity Holder. ---------
9. Miscellaneous.
(a) Amendments. This Agreement may be modified or amended only by an
instrument in writing executed by Equity Holder and each Beneficiary.
(b) Headings. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. (c) Governing
Law. This Agreement shall be construed and enforced in
accordance with the internal laws of the State of Texas, and
not the conflicts of law provisions thereof.
(d) Parties Bound. This Agreement shall be binding upon and be
enforceable against the Equity Holder and Equity Holder's Affiliates, and
their respective successors and representatives. This Agreement shall inure
to the benefit of each Beneficiary and their respective successors,
representatives and assigns. -------------
(e) Invalid Provisions. If any provision of this Agreement
(including, without limitation, any provision relating to the activities covered
by, or time period of, the covenants contained in Section 2 of this Agreement)
is held to be illegal, invalid or unenforceable under present or future laws
effective during the term hereof, such provision shall be fully severable; this
Agreement shall be construed and enforced as if such illegal, invalid or
unenforceable provision had never comprised a part hereof; and the remaining
provisions shall remain in full force and effect and shall not be affected by
the illegal, invalid or unenforceable provision or by its severance herefrom.
Furthermore, in lieu of such illegal, invalid or unenforceable provision, there
shall be added automatically as a part of this Agreement a provision as similar
in terms to such illegal, invalid or unenforceable provision as may be possible
and be legal, valid and enforceable.
(f) Construction. This Agreement shall be construed without regard to
the identity of the person who drafted the various provisions of this
Agreement. Each and every provision of this Agreement shall be construed as
though all of the parties participated equally in the drafting of this
Agreement. Consequently, Equity Holder acknowledges and agrees that any
rule of construction that a document is to be construed against the
drafting party shall not be applicable to this Agreement. ------------
(g) Defined Terms. Any capitalized terms not otherwise defined in this
Agreement shall have the same meaning as set forth in the Contribution
Agreement. -------------
[Signature page follows]
SIGNATURE PAGE TO
NON-COMPETITION AGREEMENT
EXECUTED to be effective as of the date first above written.
EQUITY HOLDER: /s/ Xxxxxx X. Xxxxxxx, O.D.
Xxxxxx X. Xxxxxxx, O.D.
