Common use of Covenant Not to Compete; No Solicitation Clause in Contracts

Covenant Not to Compete; No Solicitation. (a) For a period of five years after the Closing Date, the Selling Companies shall not, and shall cause their affiliates not to, directly or indirectly: (i) engage in the Dearborn Business in those countries where the Dearborn Business currently operates, or in the development, registration, formulation, sale or distribution of any products primarily directed to a market that competes with the Dearborn Business as currently conducted including, without limitation, products that are the result of discoveries or development by the Grace Group after the Closing Date or (ii) invest in, manage, operate, join or control as a partner, stockholder, consultant or otherwise, any Person that competes with the Dearborn Business in any jurisdiction where the Dearborn Business is currently conducted (a "Buyer Competitive Business"); provided, however, that nothing in this Section 8.8 shall prohibit the Selling Companies, or their affiliates, from owning up to 5% of the outstanding voting securities of any publicly traded entity; provided, further, that nothing in this Section 8.8 shall prohibit the Selling Companies, or their affiliates, from acquiring a Buyer Competitive Business as an incidental part of an acquisition (by joint venture, merger or other) of the assets of, or the majority of voting interests in, another Person (a "Target Business") if the worldwide sales of the Target Business from the Buyer Competitive Business are not in excess of 30% of the worldwide sales of the Target Business in the fiscal year of the Target Business, for reporting purposes, preceding such acquisition. In the event the Selling Companies, or their affiliates, acquire a Buyer Competitive Business pursuant to the second proviso in the preceding sentence and the worldwide sales of the Buyer Competitive Business are either in excess of 10% of the worldwide sales of the Target Business or in excess of US $50 million in such fiscal year, the Selling Companies shall thereafter divest such Buyer Competitive Business within a reasonable period of time by way of auction or other competitive bidding process, negotiation, sale or such other manner or divestiture as the Selling Companies shall deem appropriate.

Covenant Not to Compete; No Solicitation. (a) For Each Seller acknowledges that he has extensive knowledge and a unique understanding of the businesses of the Acquired Companies and Fabio, has been directly involved with the establishment and continued development of the customer relations of such businesses and has had access to all of the proprietary and Confidential Information (as hereinafter defined) used in such businesses. Each Seller further acknowledges that if he were to compete with the Buyer, G-III or its or their subsidiaries, including the Division (the "Buyer Group") in such businesses following the Closing, great harm would come to the Buyer Group, thereby destroying any value associated with the purchase of the Acquired Companies and the Fabio Selling Members' interests in Fabio and the goodwill of the businesses of the Acquired Companies and Fabio. In furtherance of the sale of the Purchased Shares and the Purchased Interests to the Buyer hereunder by virtue of the transactions contemplated hereby and to more effectively protect the value of the businesses so sold, each Seller covenants and agrees that, for a period of five years after (the "Restricted Period") commencing on the Closing DateDate and continuing through January 31, the Selling Companies 2009, he shall not, and shall cause their affiliates not towhether for compensation or without compensation, directly or indirectly: , as an owner, principal, partner, member, shareholder, independent contractor, consultant, joint venturer, investor, licensor, lender or in any other capacity whatsoever, alone, or in association with any other Person, carry on, be engaged or take part in, or render services (other than services which are generally offered to third parties) or advice to, own, share in the earnings of, invest in the stocks, bonds or other securities of, or otherwise become financially interested in, any Person engaged in the business of designing or manufacturing men's outerwear, women's outerwear or women's suits anywhere in the United States. The record or beneficial ownership by a Seller of less than (i) engage in the Dearborn Business in those countries where the Dearborn Business currently operates, or in the development, registration, formulation, sale or distribution of any products primarily directed to a market that competes with the Dearborn Business as currently conducted including, without limitation, products that are the result of discoveries or development by the Grace Group after the Closing Date $400,000 or (ii) invest in, manage, operate, join or control as a partner, stockholder, consultant or otherwise, any Person that competes with the Dearborn Business in any jurisdiction where the Dearborn Business is currently conducted one percent (a "Buyer Competitive Business"); provided, however, that nothing in this Section 8.8 shall prohibit the Selling Companies, or their affiliates, from owning up to 5% of the outstanding voting securities of any publicly traded entity; provided, further, that nothing in this Section 8.8 shall prohibit the Selling Companies, or their affiliates, from acquiring a Buyer Competitive Business as an incidental part of an acquisition (by joint venture, merger or other1%) of the assets ofshares of any Person whose shares or interests are publicly traded on a national securities exchange, the Nasdaq Stock Market or the majority OTC Bulletin Board shall not of voting interests initself constitute a breach hereunder. For purposes hereof, another Person (a "Target Business") if the worldwide sales of the Target Business from the Buyer Competitive Business are not in excess of 30% of the worldwide sales of the Target Business in the fiscal year of the Target Business, for reporting purposes, preceding such acquisition. In the event the Selling Companies, or their affiliates, acquire a Buyer Competitive Business pursuant to the second proviso in the preceding sentence and the worldwide sales of the Buyer Competitive Business are either in excess of 10% of the worldwide sales of the Target Business or in excess of US $50 million in such fiscal year, the Selling Companies shall thereafter divest such Buyer Competitive Business within a reasonable period of time by way of auction or other competitive bidding process, negotiation, sale or such other manner or divestiture as the Selling Companies shall deem appropriate.

Covenant Not to Compete; No Solicitation. (ai) For Each of Xxxxx and Xxxxxxxx (each, a “Restricted Person”) acknowledges that he or she has extensive knowledge and a unique understanding of the Business, has been directly involved with the establishment and continued development of the customer relations of the Business and has had access to all of the proprietary and confidential information used in the Business. Each Restricted Person further acknowledges that if he or she were to compete with Buyer or its subsidiaries, including the Divisions (the “Buyer Group”) following the Closing, great harm would come to the Buyer Group, thereby destroying any value associated with the purchase of the Assets and the goodwill of the Business. In furtherance of the sale of the Assets to Buyer hereunder by virtue of the transactions contemplated hereby and to more effectively protect the value of the Business so sold, each Restricted Person covenants and agrees that, for a period of five years after commencing on the Closing DateDate and continuing through January 31, 2011 (the Selling Companies “Restricted Period”), he or she shall not, and shall cause their affiliates not towhether for compensation or without compensation, directly or indirectly: (i) engage , as an owner, principal, partner, member, shareholder, independent contractor, consultant, joint venturer, investor, licensor, lender or in the Dearborn Business in those countries where the Dearborn Business currently operatesany other capacity whatsoever, alone, or in the developmentassociation with any other Person, registrationcarry on, formulation, sale be engaged or distribution of any products primarily directed to a market that competes with the Dearborn Business as currently conducted including, without limitation, products that are the result of discoveries or development by the Grace Group after the Closing Date or (ii) invest take part in, manageor render services (other than services which are generally offered to third parties) or advice to, operateown, join share in the earnings of, invest in the stocks, bonds or control as a partnerother securities of, stockholder, consultant or otherwiseotherwise become financially interested in, any Person that competes with engaged in the Dearborn Business business of designing or manufacturing women’s dresses anywhere in any jurisdiction where the Dearborn Business is currently conducted (a "Buyer Competitive Business")United States; provided, however, that nothing in this Section 8.8 shall prohibit the Selling Companiesif any Restricted Person’s employment under his or her Employment Agreement is terminated by Buyer without “justifiable cause”, or their affiliatesby such Restricted Person for “good reason” (as such terms are defined in the Employment Agreements), from owning up to 5% the Restricted Period for such Restricted Person shall end on the date through which Buyer pays such Restricted Person the payments described in Section 7(g) of the outstanding voting securities his or her Employment Agreement. The record or beneficial ownership by any Restricted Person of any publicly traded entity; provided, further, that nothing in this Section 8.8 shall prohibit the Selling Companies, or their affiliates, from acquiring a Buyer Competitive Business as an incidental part of an acquisition less than one percent (by joint venture, merger or other1%) of the assets of, shares of any Person whose shares or interests are publicly traded on a national securities exchange or the majority OTC Bulletin Board shall not of voting interests in, another Person (itself constitute a "Target Business") if the worldwide sales of the Target Business from the Buyer Competitive Business are not in excess of 30% of the worldwide sales of the Target Business in the fiscal year of the Target Business, for reporting purposes, preceding such acquisition. In the event the Selling Companies, or their affiliates, acquire a Buyer Competitive Business pursuant to the second proviso in the preceding sentence and the worldwide sales of the Buyer Competitive Business are either in excess of 10% of the worldwide sales of the Target Business or in excess of US $50 million in such fiscal year, the Selling Companies shall thereafter divest such Buyer Competitive Business within a reasonable period of time by way of auction or other competitive bidding process, negotiation, sale or such other manner or divestiture as the Selling Companies shall deem appropriatebreach hereunder.