STRATUS NON-COMPETE/NON-SOLICITATION AGREEMENT
EXHIBIT
10.65
STRATUS
NON-COMPETE/NON-SOLICITATION AGREEMENT
This
STRATUS NON-COMPETE
AND NON-SOLICITATION AGREEMENT
(the
“Agreement”)
is made
and entered into as of this 7th day of December, 2005, by and between
STRATUS
SERVICES GROUP, INC.,
a
Delaware company (“Stratus”)
and
TRI-STATE
EMPLOYMENT SERVICE, INC.,
a New
York corporation (“Tri-State”), and the respective affiliates, officers,
directors and/or principals of each of Stratus and Tri-State.
RECITALS:
WHEREAS,
Tri-State and Stratus have executed an Asset Purchase Agreement whereby
Tri-State has purchased certain assets related to the ongoing clerical and
light
industrial staffing business of Stratus at its offices located in Bellflower,
California, and West Covina, California (the “Purchased Assets”);
and
WHEREAS,
Stratus possesses substantial information and knowledge regarding the Purchased
Assets; and
WHEREAS,
the parties desire to enter into an agreement whereby Stratus agrees not
to
compete with Tri-State relating to the Purchased Assets.
NOW,
THEREFORE, for consideration, the receipt and sufficiency of which is hereby
acknowledged, and other good and valuable consideration, the parties hereto
agree as follows:
Confidentiality
and Trade Secrets
Stratus
acknowledges that it has had access to confidential information concerning
the
Purchased Assets and clients relating thereto, including their business affairs,
special needs, preferred methods of doing business, methods of operation,
key
contact personnel and other data, all of which provides Stratus with a
competitive edge and none of which is readily available except to Stratus
and
employees of Tri-State.
Stratus
further acknowledges that it has had access to the names, addresses, telephone
numbers, qualifications, education, accomplishments, experience, availability,
resumes and other data regarding persons who have applied or been recruited
for
temporary or permanent employment relating to the Purchased Assets, as well
as
job order specifications and the particular characteristics and requirements
of
persons generally hired by a client, specific job listings, mailing lists,
computer runoffs, financial and other information, all of which provides
Stratus
with a competitive edge and none of which is readily available except to
Stratus
and employees of Tri-State.
Stratus
agrees that all of the foregoing information regarding the Purchased Assets
and
all clients and employees related thereto constitutes valuable and proprietary
trade secrets and confidential information of Tri-State (hereafter “Confidential
Information”).
1
Non-Competition
Agreement
Stratus
agrees that it will not, during the three
(3)
year
period commencing with the Effective Date of the Asset Purchase Agreement
(“Restrictive Period”) service, solicit, compete in the geographic area of or
deal with any customers or future customers of its offices located in
Bellflower, California and West Covina, California (collectively the “Tri-State
CA Branch Offices”). Stratus acknowledges that doing so in any manner would
interfere with, diminish and otherwise jeopardize and damage the business
and
goodwill of the Tri-State CA Branch Offices. Notwithstanding the foregoing,
Stratus retains the right to continue to service all of its other existing
nationwide customers and accounts.
Non-Disclosure
Agreement
Stratus
agrees that except as directed by Tri-State, it will not at any time use
for any
reason or disclose to any person any of the Confidential Information of the
Tri-State CA Branch Offices or permit any person to examine and/or make copies
of any documents which may contain or are derived from Confidential Information,
whether prepared by Stratus or otherwise, without the prior written permission
of Tri-State.
Agreement
Not to Compete for Accounts or Personnel
Except
as
set forth above, Stratus agrees that during the Restrictive Period it will
not,
directly or indirectly, contact, solicit, divert, take away or attempt to
contact, solicit, divert or take away any staff employee, temporary personnel,
customer, account, business or goodwill from Tri-State in the Tri-State CA
Branch Offices, either for Stratus’ own benefit or some other person or entity,
and will not aid or assist any other person or entity to engage in any such
activities.
No
Adequate Remedy at Law
Stratus
acknowledges and agrees that any
breach or threatened breach by of this Agreement by Stratus would cause
immediate and irreparable injury to Tri-State and that money damages alone
would
not provide an adequate remedy
in the
event Stratus breaches any of the above covenants. Accordingly, Stratus agrees
that Tri-State shall have the right to seek and obtain an injunction to enjoin
any such breach by Stratus without the requirement of the posting of a bond
and,
if Tri-State shall institute any action or proceeding to enforce those
covenants, Stratus hereby waives and agrees not to assert the claim or defense
that Tri-State has an adequate remedy at law. The foregoing shall not prejudice
Tri-State’s right to require Stratus to account for and pay over to Tri-State
the amount of any damages incurred by Tri-State as a result of any such
breach.
Scope
and Duration
It
is
expressly understood and agreed that Stratus and Tri-State consider the
restrictions contained in this Agreement to be reasonable and necessary for
the
purposes of preserving and protecting the goodwill, legitimate business
interests, and proprietary trade secrets and confidential information of
Tri-State. Nevertheless, if any of the aforesaid restrictions are found by
a
court having jurisdiction to be unreasonable, or to be overbroad as to
geographic area, or time,
or
with
2
respect
to a particular scope of commerce,
or to
be otherwise unenforceable, the parties intend for the restrictions set forth
above to be modified by such court so as to be reasonable and enforceable
and,
as so modified by the court, to be fully enforced.
Successors
and Assigns
This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective heirs, successors and assigns, except that neither party
may assign its obligations hereunder without the prior written consent of
the
other parties hereto; provided,
however,
that
the Buyer may assign Buyer's rights hereunder to a subsidiary or affiliate
of
Buyer, provided
that the
Buyer shall remain liable for its obligations hereunder. Any assignment in
contravention of this provision shall be null and void. No assignment shall
release the Buyer from any obligation or liability under this
Agreement.
Entire
Agreement; Amendment
This
Agreement, all schedules and exhibits hereto, and all agreements and instruments
to be delivered by the parties pursuant hereto represent the entire
understanding and agreement between the parties hereto with respect to the
subject matter hereof and supersede all prior oral and written, and all
contemporaneous oral negotiations, commitments and understandings between
such
parties. The Buyer and the Seller, by the consent of their respective Boards
of
Directors, or officers authorized by such Boards, may amend or modify this
Agreement, in such manner as may be agreed upon, by a written instrument
executed by the Buyer and the Seller.
Governing
Law
This
Agreement shall be governed by and construed in accordance with the laws
of the
State of New Jersey, without regard to conflicts of law principles.
Section
Headings
The
section headings are for the convenience of the parties and in no way alter,
modify, amend, limit, or restrict the contractual obligations of the
parties.
Severability
The
invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this
Agreement.
3
Counterparts
This
Agreement may be executed in one or more counterparts, each of which shall
be
deemed an original but all of which, when taken together, shall be one and
the
same document.
STRATUS
SERVICES GROUP, INC.
By:
/s/
Xxxxxx X. Xxxxxxx
Xxxxxx
X.
Xxxxxxx
Chairman
and CEO
TRI-STATE
EMPLOYMENT SERVICE, INC.
By:
/s/
Xxxxxx Xxxxxxx
Xxxxxx
Xxxxxxx
President
4
