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EXHIBIT 10(S)
NON-COMPETITION AGREEMENT
THIS NON-COMPETITION AGREEMENT, dated as of November 9, 1993
("Agreement"), is entered into by and among Zapata Corporation, a Delaware
corporation ("Zapata"), and Peter M. Holt and Benjamin D. Holt, Jr.
(individually and collectively, the "Holts");
W I T N E S S E T H:
WHEREAS, Zapata and the Holts are parties to the Merger, Purchase and
Sale Agreement dated as of August 5, 1993, as amended (as so amended, the
"Merger, Purchase and Sale Agreement") pursuant to which Zapata will merge with
and purchase, as of the date of this Agreement, the natural gas compression
business (the "Business") conducted by Energy Industries, Inc., Cormar Rental
Co., Cormar Industries Co. and ENERQUIP, Inc. (collectively, the "Companies")
which are owned by the Holts and certain other shareholders of the Companies;
and
WHEREAS, it is a condition to the closing of the transactions
contemplated in the Merger, Purchase and Sale Agreement that the parties hereto
execute and deliver this Agreement; and
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein contained, and intending to be legally bound
hereby, the parties hereby agree as follows:
1. Each of the Holts hereby covenants and agrees
that, except as
otherwise consented to in writing by Zapata, at any time for a period of
three years following the date of this Agreement, the Holts will not,
directly or indirectly, acting alone or as an officer, director, employee,
consultant, representative, partner or equity security holder of any
corporation, partnership or other business entity:
(a) knowingly engage in any business in competition with the
Business as it is conducted on the date of this Agreement,
within the geographical borders of the states of Arkansas,
Louisiana, Kansas, New Mexico, Oklahoma and Texas (the
"Marketing Area");
(b) knowingly request any present customer or supplier of the
Business to curtail or cancel its business with Zapata with
respect to the Business;
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(c) knowingly disclose to any person, firm or corporation
any substantial and material details of organization
or business affairs of Zapata, or any names of
past or present customers of Zapata; or
(d) induce or attempt to influence any present or
prospective employee of Zapata, as of the Closing Date
under the Merger, Purchase and Sale Agreement, to
terminate his employment.
Notwithstanding the foregoing, however, nothing contained in
this Agreement shall prohibit the Holts from purchasing and
holding as an investment not more than 5% of any class for the
issued and outstanding and publicly traded (on a recognized
national or regional securities exchange or in the over-the-
counter market) security of any corporation, partnership or other
business entity which conducts a business in competition with the
Business.
2. Notwithstanding anything contained herein to the
contrary, however, in the event that Zapata shall determine that
the Holts have breached any of the covenants and agreements set
forth in Paragraph 1 hereof, Zapata shall provide the Holts with
written notice of such breach, including a description of the
facts and nature thereof, and Zapata's demand that the Holts
cease such activities, and the Holts shall, as soon as
practicable thereafter but in any event not later than ninety
(90) days from the date of such written notice, cure any such
breach.
3. In consideration for the Holts' execution, delivery and
performance of this Agreement, upon the execution and delivery of
this agreement, Zapata will pay an aggregate amount of $4,572,369
to Peter M. Holt and Benjamin D. Holt, Jr. as follows: Peter M.
Holt will receive $3,886,514 and Benjamin D. Holt, Jr. will
receive $685,855.
4. The Holts agree and acknowledge that Zapata does not have
any adequate remedy at law for the breach by the Holts of the
covenants and agreements set forth in paragraph 1, and that any
breach by the Holts of the covenants and agreements set forth in
paragraph 1 would result in irreparable injury to Zapata. The
Holts further agree and acknowledge that Zapata may, in addition
to the other remedies which may be available to Zapata, file a
suit in equity to enjoin the Holts from such breach, and consent
to the issuance of injunctive relief hereunder.
5. Notwithstanding anything contained in this Agreement to
the contrary, the Holts shall have the right, but not the
obligation, to apply to Zapata for a waiver letter in advance of
Holts' contemplated action of engaging in any business or activity
in the Marketing Area that may be construed as competitive with
the Business. In such case, Holts shall submit to Zapata a letter
containing a full and complete description of the contemplated
business or activity in which the Holts intend to
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engage, a list of all other known participants in the Holts' proposed
activity or business, a description of the role of the Holts and the
geographical location where the contemplated business or activity will be
operated or engaged in. Zapata shall be obligated to make a good faith
determination with respect to such contemplated business or activity and to
respond to the Holts affirmatively or negatively by written letter within
thirty (30) days of the receipt of such written notice, as hereinafter
defined. In such response letter Zapata shall advise the Holts of whether
it considers that such described activity would or would not be in
violation of the covenant not to compete hereinabove set forth. Upon the
failure by Zapata to respond to the Holts within thirty (30) days of
receipt of written notice from the Holts, the proposed activity or business
as set forth in the Holts' letter shall be deemed to be approved by Zapata
and not in violation of this Agreement.
6. This Agreement shall be governed by, and interpreted and enforced
in accordance with, the laws of the State of Texas, without regard to
principles of conflicts of law.
7. In the event that any provision contained in this Agreement shall,
for any reason, be judicially declared to be invalid, illegal,
unenforceable or void in any respect, such declaration shall not have the
effect of invalidating or voiding the remainder of this Agreement and the
parties hereto agree that the part or parts of this Agreement so declared
to be invalid, illegal, unenforceable or void in any respect will be deemed
to have been stricken herefrom and the remainder will have the same force
and effectiveness as if such part had never been included herein. In the
event that the length of time or the scope of the covenants set forth in
Section 1 hereof is deemed too restrictive in any court proceedings, the
court may reduce such restrictions to those it deems reasonable under the
circumstances.
8. This Agreement shall not be assigned by a party without the
consent of the other parties hereto.
9. Any notice, request, demand, waiver, consent, approval or other
communication which is required or permitted hereunder shall be in writing
and shall be deemed given only if delivered personally or sent by facsimile
transmission or by registered or certified mail, postage prepaid, return
receipt requested, as follows:
If to the Holts, then to:
Holt Companies
c/o B. D. Holt Co., d/b/a
Holt Company of Texas
S.W.W. White at Holt Avenue
San Antonio, Texas 78220
Facsimile Number: 210/648-0079
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with a copy (which shall not constitute notice) to:
Gresham, Davis, Gregory, Worth & Moore
A Professional Corporation
112 East Pecan Street
Suite 900
San Antonio, Texas 78205-1204
Facsimile Number: 210/226-5154
Attention: Marshall B. Miller, Jr.
If to Zapata Corporation then to:
Zapata Corporation
One Riverway, Suite 2200
777 South Post Oak Lane
Houston, Texas 77056
Facsimile Number: 713/940-6111
Attention: Corporate Secretary
with a copy (which shall not
constitute notice) to:
Baker & Botts, L.L.P.
3000 One Shell Plaza
Houston, Texas 77002
Facsimile Number: 713/229-1522
Attention: Roy L Nolen
or to such other address as the addressee may have specified in a notice
duly given to the sender as provided herein. Such notice, request, demand,
waiver, consent, approval or other communication will be deemed to have
been given as of the date so delivered or electronically transmitted or
sent after mailing thereof.
10. This Agreement represents the entire understanding of the parties
hereto relating to the subject matter hereof, supersedes any prior
agreements between the parties and the terms and provisions of this
Agreement may not be modified or amended, except in writing. Any failure or
delay on the part of either party in exercising any power or right
hereunder shall not operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power preclude any other or further
exercise thereof or the exercise of any other right or power hereunder.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date first written above.
ZAPATA CORPORATION
By: /s/ THOMAS H. BOWERSOX
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Thomas H. Bowersox
Executive Vice President
Benjamin D. Holt. Jr.
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By: /s/ KENNETH R. KAMP
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Kenneth R. Kamp
Attorney-In-Fact
/s/ PETER M. HOLT
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Peter M. Holt
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