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Exhibit 10.2
FORM OF NON-COMPETITION AGREEMENT
This Non-Competition Agreement (this "Agreement") is made as of
, 1997 among UBICS, INC., a Delaware corporation ("UBICS"), XXXXX XXXXXX, an
individual ("Xxxxxx"), U B INFORMATION AND CONSULTANCY SERVICES LTD., a
corporation organized under the laws of India ("UB Services"), UNITED BREWERIES
LIMITED, a corporation organized under the laws of India ("UBL"), and UB
INTERNATIONAL LIMITED, a corporation organized under the laws of the United
Kingdom ("UB International") (UB Services, UBL and UB International are
sometimes referred to hereinafter collectively as the "Companies").
PREAMBLE
UBICS is engaged in the business of providing information technology
services and personnel to business organizations (the "IT Services Business").
Xxxxxx owns a Controlling interest in or otherwise Controls (as those terms are
defined in Section 4) each of the companies comprising the UB Group
(collectively, the "UB Group Companies"). Certain of the UB Group Companies,
including UB Services, have engaged in the IT Services Business from time to
time or employ individuals who formerly were employed in the IT Services
Business.
Because of the experience of UB Services and other UB Group Companies
in the IT Services Business, Xxxxxx and the UB Group Companies, including their
Affiliates (as defined in Section 4 below) have the ability to engage, directly
or indirectly, in competition with UBICS and thereby to adversely affect its
business. Accordingly, the parties, intending to be legally bound and in
consideration of their mutual promises set forth hereto, do hereby agree as
follows.
1. Confidential Information. Xxxxxx and the Companies each acknowledge
that in the course of their conduct of the IT Services Business they or their
Affiliates may have acquired or been a party to certain Confidential Information
relating to UBICS's IT Services Business (the "UBICS Business"). "Confidential
Information" shall mean all information about the UBICS Business and its
products, methods, business, policies, practices, personnel, customers,
suppliers, distributors and sales representatives which is not in the public
domain, including without limitation all trade secrets, inventions, discoveries,
ideas, designs and know-how. Each of Xxxxxx and the Companies agrees, and shall
cause each of their affiliates, to (a) return to UBICS any Confidential
Information relating to the conduct by UBICS of the UBICS Business in tangible
form which is in their possession or control without retaining any copies or
extracts thereof, and (b) not, without the prior written consent of UBICS, use
for their own benefit or reveal to any third party any Confidential Information
(except to the extent required for performance by an Affiliate (as defined in
Section 4) of services for UBICS under a service or similar agreement with
UBICS.
2. Non-Competition. From and after the date hereof until the date which
is the later of the _______ anniversary of the date hereof or the date of
occurrence of a Change in Control (as defined in Section 4 below) of UBICS,
neither Xxxxxx nor any of the Companies nor any of their respective Affiliates
(as defined in Section 4 below) shall, as proprietor, director, officer,
partner, shareholder, employee, consultant, agent, independent contractor or
otherwise, for itself or on behalf of any other person or entity, (a) engage in
or carry on, directly or indirectly, in any part of the world (the "Territory"),
any business similar to the UBICS Business (a "Competing Business"), (b) have
any direct or indirect interest in, or be affiliated with, or render any
services for, any person or entity engaged in or
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carrying on, directly or indirectly, any Competing Business in the Territory,
(c) induce or attempt to induce any customer or supplier of the UBICS Business
to reduce the business done by such supplier or customer with the UBICS
Business, (d) solicit any employee of the UBICS Business to leave the employ of
the UBICS Business or (e) engage in any practice the purpose or result of which
is to evade the provisions of this Agreement or to commit any act that is
detrimental to the successful continuation by UBICS of the UBICS Business.
Notwithstanding the foregoing, Xxxxxx together with his Affiliates (as defined
in Section 4 below) may own in the aggregate up to 5% of the outstanding capital
stock of a publicly traded company which engages in a Competing Business without
violating this Section 2.
3. Injunctive Relief. Each of Xxxxxx and the Companies acknowledges and
agrees that the covenants and agreements set forth in Sections 1 and 2 are
necessary to protect the legitimate business interests of UBICS and that any
breach of such covenants and agreements will cause immediate and irreparable
harm to UBICS. Each of Xxxxxx and the Companies acknowledges that damages for
the violation of any such covenant or agreement will not give full and
sufficient relief to UBICS and agrees that, in the event of any violation of any
such covenant or agreement, UBICS shall be entitled to injunctive relief with
respect to any such breach, which remedy shall be in addition to any other
remedy which UBICS may have on account of such breach.
4. Certain Definitions. As used herein, the following definitions
shall apply:
(a) An "Affiliate" of a person or entity shall have the meaning
ascribed to such term for purposes of Rule 405 under the Securities Act of 1933,
as amended (the "Securities Act"), and includes any person or entity that
directly or indirectly through one or more intermediaries, Controls or is
Controlled by, or is under common Control with, the person or entity specified.
(b) "Change in Control" shall mean any of the following events:
(i) any individual, corporation, partnership, association, trust or
other entity (other than Xxxxxx or an Affiliate of Xxxxxx) becomes the
beneficial owner (as defined in Rule 13(d)(3) under the Securities
Exchange Act of 1934), directly or indirectly, of securities of UBICS
representing 50% or more of the combined voting power of the then
outstanding voting securities of UBICS;
(ii) consummation of an agreement by UBICS to consolidate or merge
with any other entity pursuant to which UBICS will not be the
continuing or surviving corporation or pursuant to which shares of the
common stock of UBICS would be converted into cash, securities or other
property, other than a merger of UBICS in which holders of the common
stock of the surviving corporation immediately prior to the merger
would have the same proportion of ownership of common stock of the
surviving corporation immediately after the merger;
(iii) consummation of an agreement of UBICS to sell, lease,
exchange or otherwise transfer in one transaction or a series of
related transactions substantially all the assets of UBICS;
(iv) consummation of any plan or proposal adopted by UBICS for a
complete or partial liquidation or dissolution of UBICS; or
(v) consummation of an agreement to sell more than 50% of the
outstanding voting securities of UBICS in one or a series of related
transactions other than an initial public offering of voting securities
registered with the Securities and Exchange Commission.
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(c) The term "Control" (including the terms "Controlling, "Controlled
by" and "under common Control with") shall have the meaning ascribed to such
term for purposes of Rule 405 under the Securities Act, and includes the
possession, direct or indirect, of the power to direct or cause the direction of
the management and policies of a person or entity, whether through the ownership
of voting securities, by contract, or otherwise.
5. Xxxxxx and each Company agree to use, and to cause each of their
respective Affiliates to use, their best efforts to cause each entity which he
or it Controls, including the UB Group Companies, to comply with the covenants
set forth in this Agreement.
6. Agreements of UB Services. UB Services acknowledges that it has
ceased all business activities relating to the IT Services Business and agrees
that it shall cease all active business operations within 90 days after the date
hereof or as soon as practicable thereafter. Xxxxxx, UBL and UB International
shall take all action, and shall cause each of their Affiliates which Control UB
Services to take all action, as may be required to cause UB Services to comply
with each of its covenants set forth in this Agreement. In addition, UB Services
hereby transfers and assigns to UBICS its entire right, title and interest in
and to the trade name "UBICS" and any derivation thereof and disclaims any right
to use said trade name or any derivation thereof anywhere in the Territory.
7. Miscellaneous.
(a) Notices. All notices or other communications which may be given
hereunder shall be in writing and shall be given to the addresses set
forth below:
If to UBICS:
UBICS, Inc.
000 Xxxxxx Xxxxxx Xxxxx
0000 Xxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attn: President
If to Xxxxxx or the Companies:
c/o Xxxxx Xxxxxx
Xxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
(b) Successors and Assigns. This Agreement and all rights and
powers granted hereby shall bind and inure to the benefit of the
parties hereto and their respective successors and assigns.
(c) Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the Commonwealth
of Pennsylvania.
(d) Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
(e) Amendment. To be effective, any amendment or waiver to this
Agreement must be in writing and be signed by the party against whom
enforcement of the same is sought.
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(f) Severability. If any portion of this Agreement shall for any
reason be held by a court of competent jurisdiction to be invalid and
unenforceable, the valid and enforceable provisions will continue to be
given effect and bind the parties hereto. In addition, the covenants
set forth in Sections 1 and 2 are intended to be separate covenants for
each county and district and each country, state, province or other
political subdivision comprising a part of the Territory, and the
invalidity of such clauses as to any country, county, state or
political subdivision shall not affect their validity as to any other
country, county, state or political subdivision comprising a part of
the Territory.
(g) Entire Agreement. This Agreement sets forth all of the
promises, covenants, agreements, conditions and undertakings between
the parties hereto with respect to the subject matter hereof, and
supersedes all prior and contemporaneous agreements and understandings,
inducements or conditions, express or implied, oral or written.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date and year first written above.
UBICS, INC.
By: ______________________________________
President
__________________________________________
Xxxxx Xxxxxx
UB INFORMATION AND CONSULTANCY
SERVICES LTD.
By: ______________________________________
Authorized Officer
UNITED BREWERIES LIMITED
By: ______________________________________
Authorized Officer
UB INTERNATIONAL LIMITED
By: ______________________________________
Authorized Officer
