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EXHIBIT 10.8
NONCOMPETITTON AGREEMENT
THIS NONCOMPETITION AGREEMENT is made as of February 12, 1999, by
and
between Bay State Gas Company, a
Massachusetts corporation ("Company"), and
Roger A. Young ("Young").
RECITALS
l.
Pursuant to the Agreement and Plan of Merger dated as
of December 18, 1997 ("Merger Agreement")
by and among NIPSCO Industries, Inc,
("NIPSCO"), the Company (which was
previously named Acquisition Gas Company) and
Bay State Gas Company, a Massachusetts
corporation ("Bay State"), Bay State
merged on this date with and into the
Company ("Merger").
2. The
Company and Young desire to enter arrangements to
preclude Young from engaging in activities
during his employment and upon his
termination of employment with the Company
(or any corporation which is a direct
or indirect subsidiary of NIPSCO) which
compete with the Company, NIPSCO and its
subsidiaries or any of their
predecessors.
NOW THEREFORE, in consideration of the mutual covenants and
promises
herein, and other good and valuable
consideration, the receipt and sufficiency
of which are hereby acknowledged, the
Company and Young, each intending to be
legally bound, agree as follows:
1. COVENANTS CONCERNING COMPETITION
(a) Covenant
Not To Compete. During the term of Young's employment
with the Company and for a period of three
years thereafter, Young will not in
any manner, directly or indirectly:
(i) manage,
consult, be employed by, operate, join,
promote, be compensated by, render advice to, control or
participate in
the business of any individual, firm, corporation, institution
or
company engaged in the Same or Similar Activities (as defined
below)
carried on by Bay State, the Company, NIPSCO or its subsidiaries or
any
of their predecessors in any of the United States (excluding Alaska
and
Hawaii); or
(ii)
own or have any ownership interest in any
privately-held corporation, firm, institution or company engaged in
the
Same or Similar Activities carried on by Bay State, the Company,
NIPSCO
or its subsidiaries or any of their predecessors in any of the
United
States (excluding Alaska and Hawaii); or
(iii) own
or have an ownership interest of more than 2% of
the publicly-traded securities of any public corporation, firm,
institution or company
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engaged in the Same or Similar Activities carried on by Bay State,
the
Company, NIPSCO or its subsidiaries or any of their predecessors in
any
of the United States (excluding Alaska and Hawaii).
For purposes of the Noncompetition Agreement, Same or Similar
Activities shall mean the operation of a:
(i) natural gas utility business, (ii)
electric utility business, (iii) gas or
electric generator business, (iv) gas or
electric distribution business, (v) gas
transportation business, (vi) gas
pipeline or transmission business, (vii)
pipeline construction business, (viii)
utility locating and marking services
business, (ix) business involving the
provision of non-regulated energy products
and services of a type provided by
Bay State as of this date, and (x) any
business involving gas storage
facilities.
(b)
Non-Solicitation. During the term of Young's employment with
the Company and for a period of three years
thereafter, Young will not in any
manner, directly or indirectly, cause,
persuade, solicit, induce or attempt to
do any of the foregoing in order to:
(i) cause any
person, business or entity which is a
supplier or customer of the Company, NIPSCO or its subsidiaries at
any
time during the term of his employment to terminate any written or
oral
agreement or understanding with the Company, NIPSCO or its
subsidiaries; or
(ii)
cause any person employed by the Company, NIPSCO or
its subsidiaries at any time during the term of his employment
to
terminate their employment with the Company, NIPSCO or its
subsidiaries
in order to work for any individual, firm, corporation, institution
or
company engaged in the Same or Similar Activities carried on by
the
Company, NIPSCO or its subsidiaries in any of the United States
(excluding
Alaska and Hawaii).
(c) Judicial
Modification of Covenants Concerning Competition. If
any provision contained in this Section 1
shall for any reason be held invalid,
illegal or unenforceable in any respect,
such invalidity, illegality or
unenforceability shall not affect any other
provisions of this Section l, rather
this Section 1 shall be construed as if
such invalid, illegal or unenforceable
provision had never been contained herein.
It is the intention of the parties
that if any of the restrictions or
covenants contained herein is held to cover a
geographic area or to be of a duration of
time which is not permitted by
applicable law, or in any way construed to
be too broad or to any extent
invalid, such provisions shall not be
construed to be null, void or of no
effect, but, to the extent such provision
would be valid or enforceable under
applicable law if limited in scope or
duration, a court of competent
jurisdiction shall construe and interpret
or reform this Section 1 to provide
for a covenant having the maximum
enforceable geographic area, time period and
other provisions (not greater than those
contained herein) as shall be valid and
enforceable under such applicable law.
(d) Company's
and NIPSCO's Interest. Young acknowledges that the
Company and NIPSCO and its subsidiaries
have a legitimate interest which the
provisions of this Section 1 are reasonably
necessary to protect, that the
restrictions on competition contained in
this Section 1 are reasonable and that
the consideration set forth in Section 2 is
sufficient for purposes of this
Section 1.
2
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(e) Survival
of Obligations. If Young's employment with the
Company is terminated for any reason,
Young's duties, obligations and
responsibilities under this Noncompetition
Agreement shall survive and shall
continue as set forth herein.
2. CONSIDERATION
In consideration of Young entering into this Noncompetition
Agreement,
Young shall be paid compensation as
follows:
(a)
Consideration. In consideration of Young entering into this
Noncompetition Agreement, the Company will
be making principal payments to Young
in connection with this Noncompetition
Agreement in the amount of $3,200,000.
Except as provided in this Section 2(a),
the Company shall pay Young the payment
in the amounts shown in the column
"Payment" and on the dates set forth on
Schedule 2(a) attached hereto. In the event
Young is not a director of NIPSCO on
June 30, 2002, and his failure to be a
director is not due to his death or
resignation as a director, then the Company
shall pay Young the amount
