EXHIBIT 10.3
NON-COMPETITION AGREEMENT
This Non-Competition Agreement (the "Agreement") is effective as of
October 11, 2002 (the "Effective Date"), by and among Delta Computec Inc., a New
York corporation ("Seller"), NQL Inc., a Delaware corporation and sole
shareholder of Seller ("Shareholder"), and XxxxXxxx.xxx, Inc., a Delaware
corporation ("Buyer").
RECITALS:
WHEREAS, Seller, Shareholder and Buyer entered into an Asset Purchase
Agreement as of May 31, 2002, as approved pursuant to that certain Order of the
United States Bankruptcy Court for the District of New Jersey dated August 7,
2002 (the "Order"; together with the Asset Purchase Agreement, the "Asset
Purchase Agreement").
WHEREAS, in order to induce Buyer to enter into the Asset Purchase
Agreement and to pay the Purchase Price (as defined in the Asset Purchase
Agreement), pursuant to Section 3.6(D) of the Asset Purchase Agreement, the
Seller and Shareholder agreed to execute a three year non-competition agreement
in favor of Buyer;
NOW, THEREFORE, for good and valuable consideration, receipt and
adequacy of which is hereby acknowledged by all parties hereto, the parties
hereto agree as follows:
1. Each of Seller and Shareholder hereby covenants and agrees with
Buyer that neither Seller, Shareholder, nor any Subsidiary of Seller or
Shareholder will, between the Effective Date and the third anniversary of the
Effective Date, engage in or carry on any business in New York, New Jersey,
Delaware, Louisiana, California, Maryland, Georgia, Texas, Ohio, Connecticut,
Pennsylvania and Massachusetts which would be in competition with the Business
of Seller as such Business of Seller was conducted by Seller immediately prior
to the Effective Date and had been conducted by Seller during the two years
prior to the Effective Date.
2. Each of Seller and Shareholder further covenants that until the
third anniversary of the Effective Date, except as required by Law or
Governmental Authority neither Seller, Shareholder, nor any Subsidiary of Seller
or Shareholder will disclose any confidential information with respect to the
Business of Seller without the prior written consent of Buyer.
3. Neither Seller, Shareholder, nor any Subsidiary of Seller or
Shareholder, shall, without first obtaining the permission of Buyer, directly or
indirectly solicit for employment or employ from the Effective Date until the
third anniversary of the Effective Date, any employees of Buyer or any of its
Subsidiaries who are employees of Buyer or any of its Subsidiaries as of the
Effective Date or who become employees after the Effective Date and prior to the
third anniversary of the Effective Date.
4. Although the parties have, in good faith, used their commercially
reasonable efforts to make the provisions of this Agreement reasonable in
substantive scope, geographic area and duration, and the parties do not
anticipate or intend that a court of competent jurisdiction would find it
necessary to reform any such provisions to make them reasonable in substantive
scope, geographic area, duration or otherwise, the parties understand and agree
that if a court of competent jurisdiction determines it necessary to reform the
scope of this Agreement in order to make it reasonable in substantive scope,
geographic area, duration or otherwise, with respect to any party, such
provisions shall be considered to be divisible in all respects, and such lesser
scope as any such court shall determine to be reasonable shall be effective,
binding and enforceable against such party. Each of Seller and Shareholder
acknowledges and agrees that the Buyer's damages in event of any breach or
threatened breach of any applicable covenants set forth in this Agreement will
be difficult to determine and that, without limiting any other right or remedy
of the Buyer, Buyer shall be entitled to appropriate injunctive or equitable
relief from a court of competent jurisdiction to prevent any breach or
threatened breach.
5. The parties hereto agree that the following terms used in this
Agreement shall have the following definitions: (i) "Subsidiary" means any
corporation or other entity which Seller or Shareholder, as appropriate,
directly or through one or more intermediaries, controls, which for the purposes
of this Agreement, shall be deemed to include any corporation or other entity in
which Buyer, Seller or Shareholder or such intermediary (a) owns at least a
majority of the outstanding voting securities or similar evidences of ownership
or (b) has the contractual power to designate at least a majority of the
directors of a corporation, or in the case of unincorporated entities, of
individuals exercising similar functions; (ii) "Business of Seller" means
providing professional information technology services, including Internet and
intranet consulting, network, design, and onsite support for customers located
primarily in the northeastern United States; (iii) "Law" means all applicable
provisions of all (a) constitutions, treaties, statutes, laws (including the
common law), rules, regulations, ordinances, codes or orders of any Governmental
Authority and (b) orders, decisions, injunctions, judgments, awards and decrees
of, or agreements with, any Governmental Authority; and (iv) "Governmental
Authority" means any nation or government, any state or other political
subdivision thereof, any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government,
including, without limitation, any governmental authority, quasi-governmental
authority, agency, department, board, commission or instrumentality of the
United States, any state of the United States or any political subdivision
thereof, any tribunal or arbitrator(s) of competent jurisdiction and any
self-regulatory organization.
6. This Agreement will be governed by and construed under the laws of
the State of New Jersey without regard to the conflict-of-laws principles.
7. This Agreement constitutes the entire agreement among the parties
and supersedes all prior oral or written agreements, understandings,
representations and warranties and courses of conduct and dealing between the
parties on the subject matter
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hereof. Except as otherwise provided herein, this Agreement may be amended,
modified or waived only by a writing executed by all of the parties hereto.
8. This Agreement may be executed by facsimile and in one or more
counterparts, each of which will be deemed to be an original of this Agreement
and all of which, when taken together, will be deemed to constitute one and the
same Agreement.
* * * * *
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IN WITNESS THEREOF, the undersigned have executed this Agreement.
DELTA COMPUTEC INC., a New York corporation
By: /s/ XXXX XXXXXX
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Name: Xxxx XxXxxx
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Title: President
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NQL INC., a Delaware corporation
By: /s/ XXXXXXX X. XXXXXXXX
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Name: Xxxxxxx X. Xxxxxxxx
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Title: Authorized Representative
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XXXXXXXX.XXX, INC., a Delaware corporation
By: /s/ XXXXXX X. XXXXXX
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Name: Xxxxxx X. Xxxxxx
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Title: Chief Financial Officer
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