Non-Competition; Non-Solicitation; Confidentiality. (a) The Company agrees that from the Closing until the third anniversary of the Closing (the “Restriction Period”), the Company shall not (and shall cause the Restricted Persons not to) engage, or directly or indirectly own a controlling interest in any Person who engages, in the development and sale of products or services that provide the same or substantially similar principal functionality or services as the Business Products in direct competition with the Business as conducted as of immediately prior to Closing anywhere in the Restricted Territories (a “Competitive Business”), other than pursuant to arrangements with the Buyer or any of its Subsidiaries; provided, however, that nothing herein shall prohibit the Company or any Restricted Persons from: (i) being a passive owner of not more than 5% of the outstanding stock of any class of a corporation which is publicly traded so long as none of such Persons has any active participation in the business of such corporation; (ii) owning any Equity Securities in any Person through any Seller Benefit Plan; (iii) engaging or otherwise utilizing, or entering into a commercial relationship with, in each case, in the ordinary course of business, a Person not affiliated with the Company that engages in a Competitive Business; (iv) engaging in any business conducted by the Company or its Affiliates on the date of this Agreement (other than the Business) and continuing to sell its products and services, as well as any new releases, updates and successors to such products and services; (v) continuing to engage in the Business for the benefit of the Buyer or any of its Subsidiaries as required or expressly contemplated by this Agreement or any other Transaction Document; or (vi) acquiring or investing in any Person or business which has operations the conduct of which violates this Section 10.9 (and engaging in any Competitive Business of such Person or business) if (i) such operations account for less than the greater of (x) 20% of such Person’s consolidated revenues for the fiscal year ended immediately prior to such acquisition (provided that this Section 10.9(a)(vi)) shall be deemed not to be violated if within eighteen (18) months following the consummation of such acquisition the operations of which violates this Section 10.9 account for less than 20% percent of such Person’s consolidated annual revenues for the then most recently completed fiscal year) and (y) $200 million in consolidated revenues for the fiscal year ended immediately prior to the date of such acquisition or investment or (ii) the Company promptly commences and thereafter pursues in good faith until the earlier to occur of the expiration of the Restriction Period and 18 months after such acquisition or investment, the transfer of that portion of the business of such acquired Person as violated this upon terms and conditions and at a price determined by the Company in its sole discretion (provided that such 18 month period shall be extended to the date on which all approvals from a Governmental Body required to complete the divestiture are received (to no later than the third anniversary following the acquisition of such Person or divisions or lines of business of such Person) if such approvals are not received by the end of such 18-month period. (b) The Company acknowledges that the Business has been conducted or is presently proposed to be conducted throughout EMEA, Asia Pacific, North America and South America (the “Restricted Territories”). (c) The Company agrees that from the Closing until the second anniversary of the Closing it shall not (and shall cause the Restricted Persons not to) directly, or indirectly through another Person, (i) solicit any Employee who has the title of Senior Vice President or other equivalent or higher position (a “Senior Employee”) to leave the employ of the Buyer or its Subsidiaries and (ii) hire any person who was a Senior Employee of any of the Buyer or its Subsidiaries at any time during the ninety (90)-day period immediately prior to the date on which such hiring would take place; provided that nothing in this Section 10.9(c) shall restrict the Company or any of the Restricted Persons from (A) engaging in general advertisements and other similar broad forms of solicitation or other generalized searches by use of advertising or recruiting efforts (including the use of search firms) which are not specifically targeted at Senior Employees;) or (B) soliciting for employment, offering to hire, employing, hiring or otherwise contracting for the services of, any person whose employment with the Buyer or any of its Affiliates was terminated at least six (6) months prior to commencement of new employment discussions with such person by the Company or any of its Subsidiaries. (d) The Company agrees that, during the Restriction Period, it shall hold and shall cause each of the Restricted Persons to hold in strict confidence, and not to use in a manner in violation of Section 10.9(a), any and all of the Confidential Information; provided, however, that the Company and the Restricted Persons may disclose, or may permit disclosure of, Confidential Information (i) to their respective representatives who have a need to know such information, (ii) if the Company, its Subsidiaries or their respective representatives are requested or compelled to disclose any such Confidential Information by judicial or administrative process or by other requirements of Law or other legal process (by oral questions, interrogatories, requests, subpoenas, depositions, civil investigative demands or otherwise) or any Governmental Body, securities exchange, market or automated quotation system to which such Person is subject, (iii) in connection with any proceeding to enforce such party’s rights under this Agreement or any Transaction Document or (iv) for any Permitted Information Use. Notwithstanding the foregoing, in the event that any demand or request for disclosure of Confidential Information is made pursuant to clause (ii) immediately above, the Company shall (x) to the extent legally permissible and reasonably practicable under the circumstances, promptly notify the Buyer of the existence of such request or demand so that the Buyer may, at its expense, seek a protective order or other appropriate remedy and/or waive compliance with the provisions of this Section 10.9(d) and (y) if requested by the Buyer (at the Buyer’s sole cost and expense), cooperate with the Buyer in seeking a protective order or other appropriate remedy in respect to such request or demand. (e) If, at the time of enforcement of the covenants contained in this Section 10.9 (the “Restrictive Covenants”), a court of competent jurisdiction or an arbitral tribunal shall hold that the duration, scope or area restrictions stated herein are unreasonable under circumstances then existing, the parties agree that such provision will be construed by limiting and reducing it so as to be enforceable to the maximum extent permissible under applicable Law. The Company has consulted with legal counsel regarding the Restrictive Covenants and based on such consultation has determined and hereby acknowledges that the Restrictive Covenants are reasonable in terms of duration, scope and area restrictions and are necessary to protect the goodwill of the Business and the substantial investment in the Business, the Sold Companies and the Sold Subsidiaries made by the Buyer hereunder. The Company further acknowledges and agrees that the Restrictive Covenants are being entered into by it in connection with the sale of the Transferred Assets and the goodwill of the Business pursuant to this Agreement. (f) Notwithstanding anything contained herein to the contrary, this Section 10.9 shall not be applicable to the acquiring or surviving (or ultimate parent) entity resulting from a Change of Control; provided that this Section 10.9 shall continue to apply to each of such Person’s Subsidiaries that is a Restricted Person. For avoidance of doubt, if the Company or any of the Restricted Persons sells to a Person any portion of its or such Restricted Person’s respective businesses (whether by means of acquisition, stock sale, asset purchase, merger, consolidation, similar business combination or otherwise), the restrictions contained in this Section 10.9 shall not prohibit such sale and shall not apply to any such Person or such Person’s Affiliates. (g) For purposes of this Section 10.9:
Appears in 1 contract
Non-Competition; Non-Solicitation; Confidentiality. (a) The Company agrees that Except for services to be provided in connection with Seller’s Product Business, for a period from the Closing until Time to the third (3rd) anniversary of the Closing Time plus the number of years obtained by multiplying (i) three (3) years by (ii) a fraction, the numerator of which is the actual aggregate amount of Earn-Out Payments that are earned through the year ended December 31, 2015 in accordance with Section 3.4 of this Agreement, if any, and the denominator of which is $17,000,000 (the “Restriction Restricted Period”), the Company shall not ) (and shall cause the Restricted Persons not to) engage, or directly or indirectly own a controlling interest in any Person who engageshowever, in the development and sale event that on the third (3rd) anniversary of products or services that provide the same or substantially similar principal functionality or services as Closing Time, all $17,000,000 of the Business Products in direct competition with the Business as conducted as potential Earn-Out Payments have not already been finally determined to have been earned pursuant to Section 3.4 of immediately prior to Closing anywhere in this Agreement, then the Restricted Territories (a “Competitive Business”), other than pursuant Period shall be extended to arrangements with the Buyer or any later of its Subsidiaries; provided, however, that nothing herein shall prohibit the Company or any Restricted Persons from:
(i) being a passive owner of not more than 5% of the outstanding stock of any class of a corporation which is publicly traded so long as none of such Persons has any active participation in the business of such corporation;
(ii) owning any Equity Securities in any Person through any Seller Benefit Plan;
(iii) engaging or otherwise utilizing, or entering into a commercial relationship with, in each case, in the ordinary course of business, a Person not affiliated with the Company that engages in a Competitive Business;
(iv) engaging in any business conducted by the Company or its Affiliates on the date the Third Year Earn-Out Payment is finally determined pursuant to Section 3.4 of this Agreement (other than the Business) and continuing to sell its products and services, as well as any new releases, updates and successors to such products and services;
(v) continuing to engage in the Business for the benefit of the Buyer or any of its Subsidiaries as required or expressly contemplated by this Agreement or any other Transaction Document; or
(vi) acquiring or investing in any Person or business which has operations the conduct of which violates this Section 10.9 (and engaging in any Competitive Business of such Person or business) if (i) such operations account for less than the greater of (x) 20% of such Person’s consolidated revenues for the fiscal year ended immediately prior to such acquisition (provided that this Section 10.9(a)(vi)) shall be deemed not to be violated if within eighteen (18) months following the consummation of such acquisition the operations of which violates this Section 10.9 account for less than 20% percent of such Person’s consolidated annual revenues for the then most recently completed fiscal year) and (y) $200 million in consolidated revenues for the fiscal year ended immediately prior to the date of such acquisition or investment or (ii) the Company promptly commences Restricted Period as set forth in the formula in the previous sentence taking into account any Third Year Earn-Out Payment), Seller shall not, and thereafter pursues shall cause the Voting Trustees and Voting Shareholders not to, directly or indirectly, own, manage, engage in, operate, control, work for, consult with, render services for, do business with, maintain any interest in good faith until (proprietary, financial or otherwise) or participate in the earlier to occur ownership, management, operation or control, of any business, whether in corporate, proprietorship or partnership form or otherwise, engaged in the Business or that otherwise competes with the Business (a “Restricted Business”) in the Territory; provided, that the restrictions contained in this Section 7.1(a) shall not restrict the acquisition by Seller, directly or indirectly, of less than five percent (5%) of the expiration outstanding capital stock of any publicly traded company engaged in a Restricted Business. The parties hereto specifically acknowledge and agree that the remedy at law for any breach of the Restriction Period foregoing will be inadequate and 18 months after such acquisition or investmentthat Purchaser, the transfer of that portion of the business of such acquired Person as violated this upon terms and conditions and at a price determined by the Company in its sole discretion (provided that such 18 month period addition to any other relief available to it, shall be extended entitled to temporary and permanent injunctive relief without the date on which all approvals from a Governmental Body required to complete the divestiture are received (to no later than the third anniversary following the acquisition necessity of such Person proving actual damage or divisions or lines of business of such Person) if such approvals are not received by the end of such 18-month periodposting any bond whatsoever.
(b) The Company acknowledges that During the Restricted Period, Seller shall not, and shall cause the Voting Trustees and Voting Shareholders not to, directly or indirectly: (i) cause, solicit, induce or encourage any Employees to leave employment of Purchaser or any of its Affiliates or hire, employ or otherwise engage any such individual; or (ii) cause, induce or encourage any material actual or prospective client, customer, entity subcontractor, supplier (including any content providers) or licensor of the Business (including any existing or former customer of Seller and any Person that becomes a client or customer of the Business after the Closing) or any other Person who has been conducted a material business relationship with the Business, to terminate or is presently proposed to be conducted throughout EMEA, Asia Pacific, North America and South America (the “Restricted Territories”)modify any such actual or prospective relationship or hire or otherwise engage any such entity or subcontractor.
(c) The Company agrees that from From and after the Closing until the second anniversary of the Closing it Time, Seller shall not (and shall cause the Restricted Persons its Affiliates and their respective officers, and directors not to) directly, directly or indirectly through another Personindirectly, (i) solicit disclose, reveal, divulge or communicate to any Employee who has Person other than authorized officers, directors and employees of Purchaser or use or otherwise exploit for its own benefit or for the title benefit of Senior Vice President or anyone other equivalent or higher position (a “Senior Employee”) than Purchaser, any Confidential Information. Seller and its officers, directors and Affiliates shall not have any obligation to leave keep confidential any Confidential Information if and to the employ extent disclosure thereof is specifically required by applicable Law; provided, that in the event disclosure is required by applicable Law, Seller shall, to the extent reasonably possible, provide Purchaser with prompt notice of the Buyer or its Subsidiaries and (ii) hire any person who was a Senior Employee of any of the Buyer or its Subsidiaries at any time during the ninety (90)-day period immediately such requirement prior to the date on which such hiring would take place; provided making any disclosure so that nothing in this Section 10.9(c) shall restrict the Company or any of the Restricted Persons from (A) engaging in general advertisements and other similar broad forms of solicitation or other generalized searches by use of advertising or recruiting efforts (including the use of search firms) which are not specifically targeted at Senior Employees;) or (B) soliciting for employment, offering to hire, employing, hiring or otherwise contracting for the services of, any person whose employment with the Buyer or any of its Affiliates was terminated at least six (6) months prior to commencement of new employment discussions with such person by the Company or any of its SubsidiariesPurchaser may seek an appropriate protective order.
(d) The Company agrees thatcovenants and undertakings contained in this Section 7.1 relate to matters which are of a special, during the Restriction Period, it shall hold unique and shall cause each extraordinary character and a violation of any of the Restricted Persons terms of this Section 7.1 will cause irreparable injury to hold in strict confidencePurchaser, the amount of which will be impossible to estimate or determine and which cannot be adequately compensated. Accordingly, the remedy at law for any breach of this Section 7.1 will be inadequate. Therefore, Purchaser will be entitled to use in a manner in violation of Section 10.9(a)an injunction, any and all of the Confidential Information; provided, however, that the Company and the Restricted Persons may disclose, or may permit disclosure of, Confidential Information (i) to their respective representatives who have a need to know such information, (ii) if the Company, its Subsidiaries or their respective representatives are requested or compelled to disclose any such Confidential Information by judicial or administrative process or by other requirements of Law restraining order or other legal process (by oral questions, interrogatories, requests, subpoenas, depositions, civil investigative demands or otherwise) or equitable relief from any Governmental Body, securities exchange, market or automated quotation system to which such Person is subject, (iii) in connection with any proceeding to enforce such party’s rights under this Agreement or any Transaction Document or (iv) for any Permitted Information Use. Notwithstanding the foregoing, court of competent jurisdiction in the event that of any demand or request for disclosure of Confidential Information is made pursuant to clause (ii) immediately above, the Company shall (x) to the extent legally permissible and reasonably practicable under the circumstances, promptly notify the Buyer of the existence of such request or demand so that the Buyer may, at its expense, seek a protective order or other appropriate remedy and/or waive compliance with the provisions breach of this Section 10.9(d) 7.1 without the necessity of proving actual damages or posting any bond whatsoever. The rights and (y) if requested remedies provided by this Section 7.1 are cumulative and in addition to any other rights and remedies which Purchaser may have hereunder or at law or in equity. In the event that Purchaser were to seek damages for any breach of this Section 7.1, the portion of the Purchase Price which is allocated by the Buyer (at parties to the Buyer’s sole cost and expense), cooperate with the Buyer in seeking foregoing covenant shall not be considered a protective order measure of or other appropriate remedy in respect to limit on such request or demanddamages.
(e) IfThe parties hereto agree that, at the time of enforcement of the covenants contained in this Section 10.9 (the “Restrictive Covenants”), a if any court of competent jurisdiction or an arbitral tribunal shall hold in a final nonappealable judgment determines that the durationa specified time period, scope or area restrictions stated herein are unreasonable under circumstances then existinga specified geographical area, the parties agree that such provision will be construed by limiting and reducing it so as to be enforceable to the maximum extent permissible under applicable Law. The Company has consulted with legal counsel regarding the Restrictive Covenants and based on such consultation has determined and hereby acknowledges that the Restrictive Covenants are reasonable in terms of duration, scope and area restrictions and are necessary to protect the goodwill of the Business and the substantial investment in the Business, the Sold Companies and the Sold Subsidiaries made by the Buyer hereunder. The Company further acknowledges and agrees that the Restrictive Covenants are being entered into by it in connection with the sale of the Transferred Assets and the goodwill of the Business pursuant to this Agreement.
(f) Notwithstanding anything contained herein to the contrary, this Section 10.9 shall not be applicable to the acquiring or surviving (or ultimate parent) entity resulting from a Change of Control; provided that this Section 10.9 shall continue to apply to each of such Person’s Subsidiaries that is a Restricted Person. For avoidance of doubt, if the Company specified business limitation or any of the Restricted Persons sells to a Person any portion of its or such Restricted Person’s respective businesses (whether by means of acquisition, stock sale, asset purchase, merger, consolidation, similar business combination or otherwise), the restrictions contained in this Section 10.9 shall not prohibit such sale and shall not apply to any such Person or such Person’s Affiliates.
(g) For purposes other relevant feature of this Section 10.9:7.1 is unreasonable, arbitrary or against public policy, then a lesser time period, geographical area, business limitation or other relevant feature which is determined by such court to be reasonable, not arbitrary and not against public policy may be enforced against the applicable party.
Appears in 1 contract
Non-Competition; Non-Solicitation; Confidentiality. (a) The Company agrees that For a period from the date hereof until the date that is 18 months after the Closing until Date, neither Parent nor Seller shall, and each shall cause its Affiliates not to, directly or indirectly, own, manage, operate, control or participate in the ownership, management, operation or control of any business, whether in corporate, proprietorship or partnership form or otherwise, engaged in the Business or that otherwise competes with the Business other than the purchase, sale or retention of Mortgage Loans by Parent or Seller (a “Restricted Business”) in North America; provided, that the restrictions contained in this Section 7.7(a) shall not restrict Parent or Seller from acquiring, directly or indirectly, less than 5% of the outstanding capital stock of any publicly traded company engaged in a Restricted Business. In addition, for the avoidance of doubt, the restrictions set forth in this Section 7.7(a) or elsewhere in this Agreement shall in no way restrict Parent or Seller from (i) continuing to operate the businesses of Parent and Seller that are not included in the Business that is the subject of this Agreement or from engaging in any other business that does not constitute a Restricted Business, or (ii) entering into a definitive agreement with respect to, or consummating, the sale of Excluded Assets or the sale, merger, share exchange, consolidation or other business combination involving a change in control of Parent (regardless of whether the counterparty to any such definitive agreement engages in the Restricted Business); provided, that the purpose of such transaction is not to enter into the Restricted Business (either by Parent, Seller or the counterparty to any such agreement). The parties hereto specifically acknowledge and agree that the remedy at law for any breach of the foregoing will be inadequate and that Purchaser, in addition to any other relief available to it, shall be entitled to temporary and permanent injunctive relief without the necessity of proving actual damage or posting any bond whatsoever.
(b) For a period from the date hereof to the third anniversary of the Closing Date, neither Parent nor Seller shall, and each shall cause their respective Affiliates not to: (i) cause, solicit, induce or encourage any employees involved in the “Restriction Period”Business who are or become employees of Purchaser or its Affiliates to leave such employment or hire, employ or otherwise engage any such individual; or (ii) cause, induce or encourage any material actual or prospective client, customer, broker, correspondent, supplier, or licensor of the Business (including any existing or former client of Seller or the Subsidiaries and any Person that becomes a client of the Business after the Closing) or any other Person who has a material business relationship with the Business, to terminate or modify any such actual or prospective relationship.
(c) Subject to Section 7.9, from and after the date hereof, without the prior written consent of Purchaser (which consent shall not be unreasonably withheld), the Company shall not (neither Parent nor Seller shall, and each shall cause the Restricted Persons their respective Affiliates and such Affiliates’ respective officers, and directors not to) engage, or directly or indirectly own a controlling interest in indirectly, disclose, reveal, divulge or communicate to any Person who engages, in the development and sale of products or services that provide the same or substantially similar principal functionality or services as the Business Products in direct competition with the Business as conducted as of immediately prior to Closing anywhere in the Restricted Territories (a “Competitive Business”), other than pursuant authorized officers, directors and employees of Purchaser or use or otherwise exploit for its own benefit or for the benefit of anyone other than the Purchaser, any Confidential Information (as defined below). Neither Parent nor Seller or their respective officers, directors and Affiliates shall have any obligation to arrangements with keep confidential any Confidential Information if and to the Buyer or any of its Subsidiariesextent disclosure thereof is specifically required by Law; provided, howeverthat in the event disclosure is required by applicable Law, Parent and Seller shall, to the extent reasonably possible, provide Purchaser with prompt notice of such requirement prior to making any disclosure so that nothing herein Purchaser may seek an appropriate protective order. For purposes of this Section 7.7(c), “Confidential Information” shall prohibit mean any confidential information with respect to the Company Purchased Assets or any Restricted Persons from:
the Business, including, methods of operation, customers, customer lists, broker and correspondent lists, products, prices, fees, costs, Technology, inventions, Trade Secrets, know-how, Software, marketing methods, plans, personnel, suppliers, competitors, markets or other specialized information or proprietary matters. “Confidential Information” does not include, and there shall be no obligation hereunder with respect to, information that (i) being a passive owner of not more than 5% of is generally available to the outstanding stock of any class of a corporation which is publicly traded so long as none of such Persons has any active participation in the business of such corporation;
(ii) owning any Equity Securities in any Person through any Seller Benefit Plan;
(iii) engaging or otherwise utilizing, or entering into a commercial relationship with, in each case, in the ordinary course of business, a Person not affiliated with the Company that engages in a Competitive Business;
(iv) engaging in any business conducted by the Company or its Affiliates public on the date of this Agreement (other than the Business) and continuing to sell its products and services, as well as any new releases, updates and successors to such products and services;
(v) continuing to engage in the Business for the benefit of the Buyer or any of its Subsidiaries as required or expressly contemplated by this Agreement or any other Transaction Document; or
(vi) acquiring or investing in any Person or business which has operations the conduct of which violates this Section 10.9 (and engaging in any Competitive Business of such Person or business) if (i) such operations account for less than the greater of (x) 20% of such Person’s consolidated revenues for the fiscal year ended immediately prior to such acquisition (provided that this Section 10.9(a)(vi)) shall be deemed not to be violated if within eighteen (18) months following the consummation of such acquisition the operations of which violates this Section 10.9 account for less than 20% percent of such Person’s consolidated annual revenues for the then most recently completed fiscal year) and (y) $200 million in consolidated revenues for the fiscal year ended immediately prior to the date of such acquisition or investment or (ii) the Company promptly commences and thereafter pursues in good faith until the earlier to occur of the expiration of the Restriction Period and 18 months after such acquisition or investment, the transfer of that portion of the business of such acquired Person as violated this upon terms and conditions and at a price determined by the Company in its sole discretion (provided that such 18 month period shall be extended becomes generally available to the date on which all approvals from public other than as a Governmental Body required to complete the divestiture are received (to no later than the third anniversary following the acquisition result of such Person or divisions or lines of business of such Person) if such approvals are a disclosure not received by the end of such 18-month periodotherwise permissible thereunder.
(b) The Company acknowledges that the Business has been conducted or is presently proposed to be conducted throughout EMEA, Asia Pacific, North America and South America (the “Restricted Territories”).
(c) The Company agrees that from the Closing until the second anniversary of the Closing it shall not (and shall cause the Restricted Persons not to) directly, or indirectly through another Person, (i) solicit any Employee who has the title of Senior Vice President or other equivalent or higher position (a “Senior Employee”) to leave the employ of the Buyer or its Subsidiaries and (ii) hire any person who was a Senior Employee of any of the Buyer or its Subsidiaries at any time during the ninety (90)-day period immediately prior to the date on which such hiring would take place; provided that nothing in this Section 10.9(c) shall restrict the Company or any of the Restricted Persons from (A) engaging in general advertisements and other similar broad forms of solicitation or other generalized searches by use of advertising or recruiting efforts (including the use of search firms) which are not specifically targeted at Senior Employees;) or (B) soliciting for employment, offering to hire, employing, hiring or otherwise contracting for the services of, any person whose employment with the Buyer or any of its Affiliates was terminated at least six (6) months prior to commencement of new employment discussions with such person by the Company or any of its Subsidiaries.
(d) The Company agrees that, during the Restriction Period, it shall hold and shall cause each of the Restricted Persons to hold in strict confidence, and not to use in a manner in violation of Section 10.9(a), any and all of the Confidential Information; provided, however, that the Company and the Restricted Persons may disclose, or may permit disclosure of, Confidential Information (i) to their respective representatives who have a need to know such information, (ii) if the Company, its Subsidiaries or their respective representatives are requested or compelled to disclose any such Confidential Information by judicial or administrative process or by other requirements of Law or other legal process (by oral questions, interrogatories, requests, subpoenas, depositions, civil investigative demands or otherwise) or any Governmental Body, securities exchange, market or automated quotation system to which such Person is subject, (iii) in connection with any proceeding to enforce such party’s rights under this Agreement or any Transaction Document or (iv) for any Permitted Information Use. Notwithstanding the foregoing, in the event that any demand or request for disclosure of Confidential Information is made pursuant to clause (ii) immediately above, the Company shall (x) to the extent legally permissible and reasonably practicable under the circumstances, promptly notify the Buyer of the existence of such request or demand so that the Buyer may, at its expense, seek a protective order or other appropriate remedy and/or waive compliance with the provisions of this Section 10.9(d) and (y) if requested by the Buyer (at the Buyer’s sole cost and expense), cooperate with the Buyer in seeking a protective order or other appropriate remedy in respect to such request or demand.
(e) If, at the time of enforcement of the covenants contained in this Section 10.9 (the “Restrictive Covenants”), a court of competent jurisdiction or an arbitral tribunal shall hold that the duration, scope or area restrictions stated herein are unreasonable under circumstances then existing, the parties agree that such provision will be construed by limiting and reducing it so as to be enforceable to the maximum extent permissible under applicable Law. The Company has consulted with legal counsel regarding the Restrictive Covenants and based on such consultation has determined and hereby acknowledges that the Restrictive Covenants are reasonable in terms of duration, scope and area restrictions and are necessary to protect the goodwill of the Business and the substantial investment in the Business, the Sold Companies and the Sold Subsidiaries made by the Buyer hereunder. The Company further acknowledges and agrees that the Restrictive Covenants are being entered into by it in connection with the sale of the Transferred Assets and the goodwill of the Business pursuant to this Agreement.
(f) Notwithstanding anything contained herein to the contrary, this Section 10.9 shall not be applicable to the acquiring or surviving (or ultimate parent) entity resulting from a Change of Control; provided that this Section 10.9 shall continue to apply to each of such Person’s Subsidiaries that is a Restricted Person. For avoidance of doubt, if the Company or any of the Restricted Persons sells to a Person any portion of its or such Restricted Person’s respective businesses (whether by means of acquisition, stock sale, asset purchase, merger, consolidation, similar business combination or otherwise), the restrictions contained in this Section 10.9 shall not prohibit such sale and shall not apply to any such Person or such Person’s Affiliates.
(g) For purposes of this Section 10.9:
Appears in 1 contract
Samples: Asset Purchase Agreement (New York Mortgage Trust Inc)
Non-Competition; Non-Solicitation; Confidentiality. (a) The Company agrees that For a period of five (5) years from and after the Closing until Date, FXCM shall not, and shall cause its Affiliates not to, own, manage, engage in, operate, control, maintain any ownership interest in, or participate in the third anniversary ownership, management, operation or control of, any business, whether in corporate, proprietorship or partnership form or otherwise, which competes with the business of the Closing Company as engaged in by the Company as of the date hereof (a “Restricted Business”). For the purposes of this Section 6.6(a), the business which FXCM and/or its Affiliates are engaged in as of the date hereof shall not be deemed a Restricted Business and it is acknowledged that the business FXCM and its Affiliates are currently engaged in includes the provision of electronic systems for multiple third-party buyers and sellers to come together for the purpose of executing trades in financial instruments (it being irrelevant for this purpose how such systems are classified and/or altered over time for regulatory purposes including alteration of the logic of its system in order to become an MTF (multilateral trading facility) under The Markets in Financial Instruments Directive (as amended) of the European Union). Notwithstanding the foregoing, nothing in this Agreement shall prohibit FXCM or any of its Affiliates from: (i) acquiring and subsequently conducting any business engaged in Restricted Business (a “Future Acquired Business”) if the revenue attributable to Restricted Business (the “Restriction Competitive Revenue”) is less than 15% of the consolidated revenue of the Future Acquired Business (determined by reference to the most recently completed fiscal year of such Future Acquired Business ended prior to the date of closing of such acquisition or if earlier, the date of the definitive agreement relating thereto); (ii) purchasing or owing not more than two percent (2%) of any class of publicly traded securities or (iii) participating as a passive investor in any investment partnership or fund which invests in or otherwise owns any interest in a Restricted Business.
(b) For a period of five (5) years from and after the Closing Date, FXCM shall not, and shall cause its Affiliates not to solicit any person then employed by the Company and who was so employed at the Closing Date to leave such employment for FXCM or any of its Affiliates; provided that this Agreement shall not prohibit, limit or restrict any action with respect to any person employed by the Company who first contacts FXCM or any of its Affiliates regarding potential employment or engagement without breach of this Section 6.6(b) or ordinary course recruitment activity, general advertisement of vacant positions or engagement of a recruitment agency provided that such recruitment agency is not encouraged to approach any such employee of the Company.
(c) For a period of three (3) years from the date a Management Seller ceases to be an officer or employee of the Company (the “Management Non Compete Period”), such Management Seller shall not, directly or indirectly, own, manage, engage in, operate, control, work for, consult with, render services for, maintain any interest in (proprietary, financial or otherwise) or participate in the ownership, management, operation or control of a Restricted Business; provided, that: (i) nothing contained herein will preclude any Management Seller from (A) purchasing or owing not more than two percent (2%) of any class of publicly traded securities or (B) participating as a passive investor in any investment partnership or fund which invests in or otherwise owns any interest in a Restricted Business, and (ii) nothing contained herein will preclude any Management Seller during the Management Non Compete Period from being employed by a subsidiary, division, Affiliate or unit (each, a “Unit”) of an entity if that Unit is not itself a Restricted Business, irrespective of whether such entity does have some other Unit that is a Restricted Business. In entering into this Agreement, Management Sellers acknowledge and agree (i) that the Company shall not has goodwill and value, and further that in their capacities as officers and employees of the Company, they have acquired valuable expertise, and have knowledge of Confidential Information (as such term is defined below); and (ii) that the provisions of this Section 6.6(c) are necessary to preserve the value and goodwill related to and being acquired by Purchaser and to protect the Confidential Information being acquired by Purchaser.
(d) During the Management Non Compete Period, no Management Seller shall, and each Management Seller shall cause such Management Seller’s employees and Affiliates no to (i) solicit any Person then employed by the Restricted Persons Company to leave such employment or (ii) cause, induce or encourage any material client, customer, supplier or licensor of the Company or any other Person who has material business relationship with the Company, to terminate or modify any such relationship.
(e) For a period of three (3) years from and after the Closing Date, no Equity Seller shall, and each Institutional Equity Seller shall cause its Representatives not to) engage, disclose, reveal, divulge or directly or indirectly own a controlling interest in communicate to any Person who engages, in the development and sale of products or services that provide the same or substantially similar principal functionality or services as the Business Products in direct competition with the Business as conducted as of immediately prior to Closing anywhere in the Restricted Territories (a “Competitive Business”), other than pursuant to arrangements with the Buyer authorized officers, directors and employees of Purchaser or any of its SubsidiariesPurchaser’s Affiliates any Confidential Information (as defined below). Notwithstanding anything to the contrary, nothing in this Agreement shall restrict (i) any disclosure to any regulatory authority with jurisdiction over the Person making such disclosure or any disclosure required by any Governmental Body, Law or regulatory guidance or legal or regulatory process, (ii) any disclosure in connection with any Tax Return filed by or on behalf of an Equity Seller, (iii) any disclosure to a financial advisor, attorney, or accountant who is subject to an obligation of confidence for the purpose of obtaining advice or services from such party, (iv) any disclosure among one or more Equity Sellers and/or the Seller Representative (and/or their respective Representatives) for the purpose of evaluating, exercising or performing any rights or obligations under this Agreement or (v) any disclosure to any Representative of any Equity Seller or the Seller Representative or an Affiliate of any Equity Seller or the Seller Representative for the purposes of evaluating, exercising or performing any rights or obligations under this Agreement or who requires such information for the performance of such Person’s duties to an Equity Seller or any Affiliate of an Equity Seller; provided, however, that nothing herein shall prohibit the Company or any Restricted Persons from:
applicable Equity Seller shall, in the case of a disclosure pursuant to the foregoing clause (i) being a passive owner of not more than 5% of ), to the outstanding stock of any class of a corporation which is publicly traded so long as none extent reasonably possible and permitted by Law, provide Purchaser with prompt notice of such Persons has requirement prior to making any active participation disclosure so that Purchaser may seek an appropriate protective order. Notwithstanding the foregoing, notice to Purchaser shall not be required where disclosure is in the business of such corporation;
(ii) owning any Equity Securities in any Person through any Seller Benefit Plan;
(iii) engaging connection with a routine audit or otherwise utilizingexamination by, or entering into a commercial relationship withblanket document request from, a regulatory or governmental entity that does not specifically reference Purchaser or this Agreement. For purposes of this Section 6.6(e), “Confidential Information” means, with respect to an Equity Seller, any confidential or proprietary information with respect to the Company, including methods of operation, customer lists, products, prices, fees, costs, Technology, inventions, trade secrets, know-how, Software, marketing methods, plans, personnel, suppliers, competitors, markets or other specialized information or proprietary matters, in each case, in the ordinary course case disclosed by or on behalf of business, a Person not affiliated with the Company that engages in a Competitive Business;
(iv) engaging in any business conducted by the Company or its Affiliates on the date of this Agreement (other than the Business) and continuing to sell its products and services, as well as any new releases, updates and successors to such products and services;
(v) continuing to engage in the Business for the benefit of the Buyer or any of its Subsidiaries as required or expressly contemplated by this Agreement or any other Transaction Document; or
(vi) acquiring or investing in any Person or business which has operations the conduct of which violates this Section 10.9 (and engaging in any Competitive Business of such Person or business) if (i) such operations account for less than the greater of (x) 20% of such Person’s consolidated revenues for the fiscal year ended immediately prior to such acquisition (provided that this Section 10.9(a)(vi)) shall be deemed not to be violated if within eighteen (18) months following the consummation of such acquisition the operations of which violates this Section 10.9 account for less than 20% percent of such Person’s consolidated annual revenues for the then most recently completed fiscal year) and (y) $200 million in consolidated revenues for the fiscal year ended immediately Equity Seller prior to the date of such acquisition or investment or (ii) the Company promptly commences and thereafter pursues in good faith until the earlier to occur of the expiration of the Restriction Period and 18 months after such acquisition or investment, the transfer of that portion of the business of such acquired Person as violated this upon terms and conditions and at a price determined by the Company in its sole discretion (provided that such 18 month period shall be extended to the date on which all approvals from a Governmental Body required to complete the divestiture are received (to no later than the third anniversary following the acquisition of such Person or divisions or lines of business of such Person) if such approvals are not received by the end of such 18-month period.
(b) The Company acknowledges that the Business has been conducted or is presently proposed to be conducted throughout EMEA, Asia Pacific, North America and South America (the “Restricted Territories”).
(c) The Company agrees that from the Closing until the second anniversary of the Closing it shall not (and shall cause the Restricted Persons not to) directly, or indirectly through another Person, (i) solicit any Employee who has the title of Senior Vice President or other equivalent or higher position (a “Senior Employee”) to leave the employ of the Buyer or its Subsidiaries and (ii) hire any person who was a Senior Employee of any of the Buyer or its Subsidiaries at any time during the ninety (90)-day period immediately prior to the date on which such hiring would take place; provided that nothing in this Section 10.9(c) shall restrict the Company or any of the Restricted Persons from (A) engaging in general advertisements and other similar broad forms of solicitation or other generalized searches by use of advertising or recruiting efforts (including the use of search firms) which are not specifically targeted at Senior Employees;) or (B) soliciting for employment, offering to hire, employing, hiring or otherwise contracting for the services of, any person whose employment with the Buyer or any of its Affiliates was terminated at least six (6) months prior to commencement of new employment discussions with such person by the Company or any of its Subsidiaries.
(d) The Company agrees that, during the Restriction Period, it shall hold and shall cause each of the Restricted Persons to hold in strict confidence, and not to use in a manner in violation of Section 10.9(a), any and all of the Confidential InformationClosing; provided, however, that the Company “Confidential Information” does not include, and the Restricted Persons may disclosethere shall be no obligation hereunder with respect to, or may permit disclosure of, Confidential Information information (i) available to their respective representatives who have a need to know such informationthe public on the Closing Date, (ii) if that becomes available to the Company, its Subsidiaries or their respective representatives are requested or compelled to disclose any such Confidential Information by judicial or administrative process or by public other requirements than as a result of Law or other legal process (by oral questions, interrogatories, requests, subpoenas, depositions, civil investigative demands or otherwise) or any Governmental Body, securities exchange, market or automated quotation system to which such Person is subjecta disclosure not otherwise permissible hereunder, (iii) already in connection with any proceeding to enforce such partyEquity Seller’s rights under this Agreement or any Transaction Document or (iv) for any Permitted Information Use. Notwithstanding the foregoing, in the event that any demand or request for disclosure of Confidential Information is made pursuant to clause (ii) immediately above, the Company shall (x) to the extent legally permissible and reasonably practicable under the circumstances, promptly notify the Buyer of the existence of such request or demand so that the Buyer may, at its expense, seek a protective order or other appropriate remedy and/or waive compliance with the provisions of this Section 10.9(d) and (y) if requested by the Buyer (at the Buyer’s sole cost and expense), cooperate with the Buyer in seeking a protective order or other appropriate remedy in respect to such request or demand.
(e) If, possession at the time of enforcement disclosure to such Equity Seller by or on behalf of the covenants contained in this Section 10.9 Company, (the “Restrictive Covenants”), iv) disclosed to such Equity Seller by a court of competent jurisdiction or an arbitral tribunal shall hold that the duration, scope or area restrictions stated herein are unreasonable under circumstances then existing, the parties agree that such provision will be construed by limiting and reducing it so as to be enforceable to the maximum extent permissible under applicable Law. The Company has consulted with legal counsel regarding the Restrictive Covenants and based on such consultation has determined and hereby acknowledges that the Restrictive Covenants are reasonable in terms of duration, scope and area restrictions and are necessary to protect the goodwill of the Business and the substantial investment in the Business, the Sold Companies and the Sold Subsidiaries made by the Buyer hereunder. The Company further acknowledges and agrees that the Restrictive Covenants are being entered into by it in connection with the sale of the Transferred Assets and the goodwill of the Business pursuant to this Agreement.
(f) Notwithstanding anything contained herein to the contrary, this Section 10.9 shall not be applicable to the acquiring or surviving (or ultimate parent) entity resulting from a Change of Control; provided that this Section 10.9 shall continue to apply to each of such Person’s Subsidiaries that is a Restricted Person. For avoidance of doubt, if source other than the Company or any another party acting on behalf of the Restricted Persons sells Company without such Equity Seller knowing such source to a Person be violating any portion of its confidentiality obligation to the Company or (v) independently developed by such Restricted Person’s respective businesses (whether by means of acquisition, stock sale, asset purchase, merger, consolidation, similar business combination or otherwise), the restrictions contained in this Section 10.9 shall not prohibit such sale and shall not apply to any such Person or such Person’s AffiliatesEquity Seller.
(g) For purposes of this Section 10.9:
Appears in 1 contract
Non-Competition; Non-Solicitation; Confidentiality. (a) The Company agrees that from the Closing until During a period of three (3) years ending on the third anniversary of the Closing Date (the “Restriction Restricted Period”), the Company MWL and RQ Management shall not, and MWL and RQ Management shall not (and shall cause the Restricted Persons not permit any of their Affiliates to) engage, or directly or indirectly own a controlling interest indirectly, (i) enter into or engage in any Person who engages, in the development and sale of products or services business that provide the same or substantially similar principal functionality or services as the Business Products in direct competition competes with the Business as conducted as business of immediately prior to Closing the Group anywhere in the world (the “Restricted Territories (a “Competitive BusinessTerritory”); (ii) solicit customers, business, patronage or orders for, or sell, any products and services in competition with, or for any business, wherever located, that competes with, any Group Company within the Restricted Territory; (iii) intentionally interfere in any material respect with the business relationships (whether formed prior to or after the date of this Agreement) between any Group Company and its customers or suppliers; or (iv) promote or assist, financially or otherwise, any Person engaged in any business which competes with any Group Company within the Restricted Territory. For the avoidance of doubt, the parties acknowledge and confirm that any activities of Xx. Xxxxxx, Xx. Xxxxxxxxxx, MWL or RQ Management in relation to SwissScan do not constitute a violation of this Article 7.2 provided that the activities of SwissScan are limited to acting as a reseller of Group Products or Purchaser Products pursuant to reseller agreements which are in effect as of the date of this Agreement (copies of which have been disclosed to the Purchaser Parties in the Data Room) or which are subsequently approved by a majority vote of the entire Board of Directors of the Company. Moreover, MWL and RQ Management shall use reasonable best efforts to procure that SwissScan winds up its business and divests itself of all its assets not later than the eighteenth month anniversary of the Closing Date to the extent such is allowed by applicable Law, any shareholders or other agreement to which MWL, RQ Management or SwissScan is a party or by which they are bound and by the articles of association or other governing documents of SwissScan.
(b) During the Restricted Period, MWL and RQ Management shall not, and MWL and RQ Management shall not permit any of their Affiliates to, directly or indirectly, hire or solicit any employee of any Group Company or encourage any such employee to leave such employment or hire any such employee who has left such employment, or disrupt the relationship between any Group Company and any of its consultants, agents, representatives or vendors.
(c) MWL, RQ Management, WBB and their respective Affiliates shall not disclose, furnish, disseminate, make available, or use, any Company Confidential Information for any purpose other than pursuant to arrangements with the Buyer operation of the business of the Group. ING Investments shall not disclose, furnish, disseminate, make available, or use, and shall procure that ING Mezzanine shall not disclose, furnish, disseminate, make available, or use, any Company Confidential Information for any purpose whatsoever.
(d) For purposes of this Article 7.2, but without limitation thereof, a Seller and its relevant Affiliates will be in violation thereof if such Seller or any of its Subsidiaries; providedrelevant Affiliates engages in any or all of the activities set forth herein directly, howeveror indirectly as a partner, that nothing herein shall prohibit the Company joint venturer, member, manager, employee, agent, salesperson, consultant, officer and/or director of any Person, or as a shareholder, member or equityholder of any Person in which such Seller or any Restricted Persons from:
(i) being a passive owner of not its relevant Affiliates owns, directly or indirectly, individually or in the aggregate, more than 5% of the outstanding stock of any class of a corporation which is publicly traded so long as none of such Persons has any active participation in the business of such corporation;
(ii) owning any Equity Securities in any Person through any Seller Benefit Plan;
(iii) engaging stock, membership interests or otherwise utilizing, or entering into a commercial relationship with, in each case, in the ordinary course of business, a Person not affiliated with the Company that engages in a Competitive Business;
(iv) engaging in any business conducted by the Company or its Affiliates on the date of this Agreement (other than the Business) and continuing to sell its products and services, as well as any new releases, updates and successors to such products and services;
(v) continuing to engage in the Business for the benefit of the Buyer or any of its Subsidiaries as required or expressly contemplated by this Agreement or any other Transaction Document; or
(vi) acquiring or investing in any Person or business which has operations the conduct of which violates this Section 10.9 (and engaging in any Competitive Business of such Person or business) if (i) such operations account for less than the greater of (x) 20% of such Person’s consolidated revenues for the fiscal year ended immediately prior to such acquisition (provided that this Section 10.9(a)(vi)) shall be deemed not to be violated if within eighteen (18) months following the consummation of such acquisition the operations of which violates this Section 10.9 account for less than 20% percent of such Person’s consolidated annual revenues for the then most recently completed fiscal year) and (y) $200 million in consolidated revenues for the fiscal year ended immediately prior to the date of such acquisition or investment or (ii) the Company promptly commences and thereafter pursues in good faith until the earlier to occur of the expiration of the Restriction Period and 18 months after such acquisition or investment, the transfer of that portion of the business of such acquired Person as violated this upon terms and conditions and at a price determined by the Company in its sole discretion (provided that such 18 month period shall be extended to the date on which all approvals from a Governmental Body required to complete the divestiture are received (to no later than the third anniversary following the acquisition of such Person or divisions or lines of business of such Person) if such approvals are not received by the end of such 18-month periodequity interests.
(be) The Company acknowledges It is the desired intent of the parties that the Business has been conducted foregoing provisions of Article 7.2 shall be enforced to the fullest extent permissible in each jurisdiction in which enforcement is sought. Accordingly, the parties agree that if the covenants set forth in this Article 7.2 are deemed by any court or is presently proposed arbitrator to be conducted throughout EMEAinvalid or unenforceable in any jurisdiction, Asia Pacificthe court or arbitrator may reduce the scope thereof or otherwise amend or reform the portion thus adjudicated to be invalid or unenforceable, North America such reduction, amendment or reformation to apply only with respect to the particular jurisdiction in which such adjudication is made. The Sellers acknowledge that the Purchaser Parties have no adequate remedy at law for any breach or any threatened or attempted breach by a Seller of its covenants and South America (agreements set forth in this Article 7.2 and, accordingly, the “Restricted Territories”)Sellers agree that the Purchaser Parties shall, in addition to the other remedies that may be available to them hereunder or at Law, be entitled to commence proceedings in equity, without requirement of bond, and obtain an injunction temporarily or permanently enjoining a Seller or its relevant Affiliates from breaching or threatening or attempting any such breach of such covenants and agreements and to require compliance by a Seller or its relevant Affiliates with such covenants and agreements. For purposes of any such proceeding in equity, it shall be presumed that the remedies at law available to the Purchaser Parties would be inadequate, and that the Purchaser Parties would suffer irreparable harm as a result of the violation of any provision of this Article 7.2.
(cf) The Company agrees that from the Closing until the second anniversary of the Closing it shall not (and shall cause the Restricted Persons not to) directly, or indirectly through another Person, (i) solicit If any Employee who has the title of Senior Vice President or other equivalent or higher position (a “Senior Employee”) to leave the employ of the Buyer Seller or its Subsidiaries and (ii) hire relevant Affiliates violate the provisions of this Article 7.2, then, without prejudice to any person who was a Senior Employee of any of the Buyer or its Subsidiaries at any time during the ninety (90)-day period immediately prior other remedies available to the date on which such hiring would take place; provided that nothing in this Section 10.9(c) shall restrict the Company or any of the Restricted Persons from (A) engaging in general advertisements and other similar broad forms of solicitation or other generalized searches by use of advertising or recruiting efforts (including the use of search firms) which are not specifically targeted at Senior Employees;) or (B) soliciting for employment, offering to hire, employing, hiring or otherwise contracting for the services of, any person whose employment with the Buyer or any of its Affiliates was terminated at least six (6) months prior to commencement of new employment discussions with such person by the Company or any of its Subsidiaries.
(d) The Company agrees that, during the Restriction Period, it shall hold and shall cause each of the Restricted Persons to hold in strict confidence, and not to use in a manner in violation of Section 10.9(a), any and all of the Confidential Information; provided, however, that the Company and the Restricted Persons may disclose, or may permit disclosure of, Confidential Information (i) to their respective representatives who have a need to know such information, (ii) if the Company, its Subsidiaries or their respective representatives are requested or compelled to disclose any such Confidential Information by judicial or administrative process or by other requirements of Law or other legal process (by oral questions, interrogatories, requests, subpoenas, depositions, civil investigative demands or otherwise) or any Governmental Body, securities exchange, market or automated quotation system to which such Person is subject, (iii) in connection with any proceeding to enforce such party’s rights Purchaser Parties under this Agreement or any Transaction Document or (iv) for any Permitted Information Use. Notwithstanding the foregoing, in the event that any demand or request for disclosure provisions of Confidential Information is made pursuant to clause (ii) immediately aboveapplicable Law, the Company relevant Seller shall (x) immediately forfeit to the extent legally permissible and reasonably practicable under the circumstancesPurchaser a non-mitigable (niet voor matiging vatbare) penalty of EUR 100,000 plus EUR 10,000 for each day during which such violation continues, promptly notify the Buyer of the existence of such request or demand so that the Buyer may, at its expense, seek a protective order or other appropriate remedy and/or waive compliance with the provisions of this Section 10.9(d) and (y) if requested by the Buyer (at the Buyer’s sole cost and expense), cooperate with the Buyer in seeking a protective order or other appropriate remedy in respect to such request or demand.
(e) If, at the time of enforcement of the covenants contained in this Section 10.9 (the “Restrictive Covenants”), a court of competent jurisdiction or an arbitral tribunal shall hold that the duration, scope or area restrictions stated herein are unreasonable under circumstances then existing, the parties agree that such provision will be construed by limiting and reducing it so as to be enforceable to the maximum extent permissible under applicable Law. The Company has consulted with legal counsel regarding the Restrictive Covenants and based on such consultation has determined and hereby acknowledges that the Restrictive Covenants are reasonable in terms of duration, scope and area restrictions and are necessary to protect the goodwill of the Business and the substantial investment in the Business, the Sold Companies and the Sold Subsidiaries made by the Buyer hereunder. The Company further acknowledges and agrees that the Restrictive Covenants are being entered into by it in connection with the sale of the Transferred Assets and the goodwill of the Business pursuant to this Agreement.
(f) Notwithstanding anything contained herein to the contrary, this Section 10.9 shall not be applicable to the acquiring or surviving (or ultimate parent) entity resulting from a Change of Control; provided that this Section 10.9 shall continue to apply to each of such Person’s Subsidiaries that is a Restricted Person. For avoidance of doubt, if the Company or any of the Restricted Persons sells up to a Person any portion maximum aggregate amount of its or such Restricted Person’s respective businesses (whether by means of acquisition, stock sale, asset purchase, merger, consolidation, similar business combination or otherwise), the restrictions contained in this Section 10.9 shall not prohibit such sale and shall not apply to any such Person or such Person’s AffiliatesEUR 1,500,000 for each Seller.
(g) For purposes As used in this Article 7.2 the terms “Group” and “Group Company” shall be construed to include (i) the Company and any direct or indirect majority-owned subsidiary of this Section 10.9:the Company from time to time and (ii) Ameriscan and any direct or indirect majority-owned subsidiary of Ameriscan from time to time.
Appears in 1 contract
Non-Competition; Non-Solicitation; Confidentiality. (a) The Company agrees that from From the Closing Date until the third anniversary of the Closing (the “Restriction Period”)Date, the Company neither Colfax nor Seller shall not (and shall cause the Restricted Persons not to) engageown, manage, operate, control or directly or indirectly own a controlling interest in any Person who engages, participate in the development ownership, management, operation or control of any business, whether in corporate, proprietorship or partnership form or otherwise, that competes with the mechanical power transmission business of CPTG which is comprised of the manufacture and sale of products or services that provide the same or substantially similar principal functionality or services as the Business Products in direct competition with the Business as conducted as of immediately prior to Closing couplings, gearboxes, clutches and brakes and their related parts, anywhere in the Restricted Territories world (a “Competitive Restricted Business”), other than pursuant to arrangements with the Buyer or any of its Subsidiaries; provided, however, that nothing herein shall prohibit the Company or any Restricted Persons from:
(i) being a passive owner of not more than 5% of the outstanding stock of any class of a corporation which is publicly traded so long as none of such Persons has any active participation in the business of such corporation;
(ii) owning any Equity Securities in any Person through any Seller Benefit Plan;
(iii) engaging or otherwise utilizing, or entering into a commercial relationship with, in each case, in the ordinary course of business, a Person not affiliated with the Company that engages in a Competitive Business;
(iv) engaging in any business conducted by the Company or its Affiliates on the date of this Agreement (other than the Business) and continuing to sell its products and services, as well as any new releases, updates and successors to such products and services;
(v) continuing to engage in the Business for the benefit of the Buyer or any of its Subsidiaries as required or expressly contemplated by this Agreement or any other Transaction Document; or
(vi) acquiring or investing in any Person or business which has operations the conduct of which violates this Section 10.9 (and engaging in any Competitive Business of such Person or business) if (i) such operations account for less than the greater of (x) 20% of such Person’s consolidated revenues for the fiscal year ended immediately prior to such acquisition (provided that this Section 10.9(a)(vi)) shall be deemed not to be violated if within eighteen (18) months following the consummation of such acquisition the operations of which violates this Section 10.9 account for less than 20% percent of such Person’s consolidated annual revenues for the then most recently completed fiscal year) and (y) $200 million in consolidated revenues for the fiscal year ended immediately prior to the date of such acquisition or investment or (ii) the Company promptly commences and thereafter pursues in good faith until the earlier to occur of the expiration of the Restriction Period and 18 months after such acquisition or investment, the transfer of that portion of the business of such acquired Person as violated this upon terms and conditions and at a price determined by the Company in its sole discretion (provided that such 18 month period shall be extended to the date on which all approvals from a Governmental Body required to complete the divestiture are received (to no later than the third anniversary following the acquisition of such Person or divisions or lines of business of such Person) if such approvals are not received by the end of such 18-month period.
(b) The Company acknowledges that the Business has been conducted or is presently proposed to be conducted throughout EMEA, Asia Pacific, North America and South America (the “Restricted Territories”).
(c) The Company agrees that from the Closing until the second anniversary of the Closing it shall not (and shall cause the Restricted Persons not to) directly, or indirectly through another Person, (i) solicit any Employee who has the title of Senior Vice President or other equivalent or higher position (a “Senior Employee”) to leave the employ of the Buyer or its Subsidiaries and (ii) hire any person who was a Senior Employee of any of the Buyer or its Subsidiaries at any time during the ninety (90)-day period immediately prior to the date on which such hiring would take place; provided that nothing in this Section 10.9(c) shall restrict the Company or any of the Restricted Persons from (A) engaging in general advertisements and other similar broad forms of solicitation or other generalized searches by use of advertising or recruiting efforts (including the use of search firms) which are not specifically targeted at Senior Employees;) or (B) soliciting for employment, offering to hire, employing, hiring or otherwise contracting for the services of, any person whose employment with the Buyer or any of its Affiliates was terminated at least six (6) months prior to commencement of new employment discussions with such person by the Company or any of its Subsidiaries.
(d) The Company agrees that, during the Restriction Period, it shall hold and shall cause each of the Restricted Persons to hold in strict confidence, and not to use in a manner in violation of Section 10.9(a), any and all of the Confidential Information; provided, however, that the Company and the Restricted Persons may disclose, or may permit disclosure of, Confidential Information restrictions contained in this Section 5.10(a) shall not restrict (i) to their respective representatives who have the acquisition by Colfax or its Affiliates, directly or indirectly, of less than 5% of the outstanding capital stock of any publicly traded company engaged in a need to know such informationRestricted Business, (ii) if the Company, its Subsidiaries or their respective representatives are requested or compelled to disclose any such Confidential Information by judicial or administrative process or by other requirements of Law purchase or other legal process acquisition by Colfax or its Affiliates after the Closing Date of a business with product lines that taken alone would constitute a Restricted Business (“Competing Products”), if in the year prior to such acquisition, the Competing Products were (A) non-core business line products of such business and (B) the net sales generated by oral questionsthe Competing Products were less than 5% of the net sales of CPTG, interrogatories, requests, subpoenas, depositions, civil investigative demands or otherwise) or any Governmental Body, securities exchange, market or automated quotation system to which such Person is subject, (iii) the acquisition of any business if the Restricted Business products are for internal consumption and spare parts sales in connection with any proceeding to enforce such party’s rights under this Agreement or any Transaction Document or (iv) for any Permitted Information Usea non-Restricted Business. Notwithstanding the foregoing, Colfax or its Affiliates may acquire a business with Competing Products that exceed the thresholds set forth in provision (ii)(B) above, provided that in such case Colfax or its Affiliate making such acquisition, shall provide Buyer with prompt notice of such acquisition after the closing date of such acquisition and shall, for a period of thirty (30) days after notice to Buyer, give Buyer the opportunity to negotiate in good faith exclusively with Colfax, to buy the Competing Products on commercially reasonable terms and Price. In the event that Buyer elects not to acquire the Restricted Business, Colfax, or its Affiliates, as applicable, shall divest the Competing Products within one (1) year following the termination of the thirty (30) day negotiation period. The parties hereto specifically acknowledge and agree that the remedy at law for any breach of the foregoing will be inadequate and that Buyer, in addition to any other relief available to it, shall be entitled to temporary and permanent injunctive relief without the necessity of proving actual damage or posting any bond.
(b) From the Closing Date until the third anniversary of the Closing Date, neither Colfax nor Seller shall, directly or indirectly: (i) cause, solicit, induce or encourage any employees of Seller or Colfax who are or become employees of Buyer or its Affiliates to leave such employment; or (ii) cause, induce or encourage any material actual or prospective client, customer, supplier, or licensor of the Business (including any existing or former customer of Seller or Colfax and any Person that becomes a client or customer of the Business after the Closing known to Seller and Colfax as such) or any other Person who has a material business relationship with the Business, to terminate or modify any such actual or prospective relationship.
(c) From the Closing Date until the third anniversary of the Closing Date, neither Buyer nor any of its Affiliates shall, directly or indirectly: (i) cause, solicit, induce or encourage any employees of Seller or Colfax to leave such employment; or (ii) cause, induce or encourage any material actual or prospective client, customer, supplier, or licensor of Seller or Colfax (including any existing or former customer of Seller or Colfax and any Person that becomes a client or customer of Seller or Colfax after the Closing known to Buyer or its Affiliates as such) or any other Person who has a material business relationship with the Colfax or the Seller, to terminate or modify any such actual or prospective relationship.
(d) After the Closing Date, neither Colfax nor Seller nor any of their executive officers or directors shall, directly or indirectly, disclose, reveal, divulge or communicate to any Person other than authorized officers, directors and employees of Buyer or use or otherwise exploit for its own benefit or for the benefit of anyone other than Buyer, any Confidential Information (as defined below). Seller, Colfax and each of their executive officers and directors shall not have any obligation to keep confidential any Confidential Information if and to the extent disclosure thereof is specifically required by Law; provided, however, that in the event that any demand or request for disclosure of Confidential Information is made pursuant to clause (ii) immediately aboverequired by applicable Law, the Company such Person shall (x) to the extent legally permissible and reasonably practicable under the circumstances, promptly notify the provide Buyer of the existence with prompt notice of such request or demand requirement prior to making any disclosure so that the Buyer may, at its expense, may seek a an appropriate protective order or other appropriate remedy and/or waive compliance with the provisions of this Section 10.9(d) and (y) if requested by the Buyer (at the Buyer’s sole cost and expense), cooperate with the Buyer in seeking a protective order or other appropriate remedy in respect to such request or demand.
(e) If, at the time of enforcement of the covenants contained in this Section 10.9 (the “Restrictive Covenants”), a court of competent jurisdiction or an arbitral tribunal shall hold that the duration, scope or area restrictions stated herein are unreasonable under circumstances then existing, the parties agree that such provision will be construed by limiting and reducing it so as to be enforceable to the maximum extent permissible under applicable Laworder. The Company has consulted with legal counsel regarding the Restrictive Covenants and based on such consultation has determined and hereby acknowledges that the Restrictive Covenants are reasonable in terms of duration, scope and area restrictions and are necessary to protect the goodwill of the Business and the substantial investment in the Business, the Sold Companies and the Sold Subsidiaries made by the Buyer hereunder. The Company further acknowledges and agrees that the Restrictive Covenants are being entered into by it in connection with the sale of the Transferred Assets and the goodwill of the Business pursuant to this Agreement.
(f) Notwithstanding anything contained herein to the contrary, this Section 10.9 shall not be applicable to the acquiring or surviving (or ultimate parent) entity resulting from a Change of Control; provided that this Section 10.9 shall continue to apply to each of such Person’s Subsidiaries that is a Restricted Person. For avoidance of doubt, if the Company or any of the Restricted Persons sells to a Person any portion of its or such Restricted Person’s respective businesses (whether by means of acquisition, stock sale, asset purchase, merger, consolidation, similar business combination or otherwise), the restrictions contained in this Section 10.9 shall not prohibit such sale and shall not apply to any such Person or such Person’s Affiliates.
(g) For purposes of this Section 10.9:5.10(c), “Confidential Information” shall mean any confidential information with respect to the Business, including, methods of operation, customers, customer lists, products, prices, fees, costs, technology, inventions, trade secrets, know-how, software, marketing methods, plans, personnel, suppliers, competitors, markets or other specialized information or proprietary matters and the terms, including purchase price and parties, of this Agreement and the transactions contemplated hereby. “Confidential Information” does not include, and there shall be no obligation hereunder with respect to, information that (i) is generally available to the public on the date of this Agreement, (ii) is used by Colfax or Seller in connection with its other business operations or (iii) becomes generally available to the public other than as a result of a prohibited disclosure hereunder.
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