Exhibit 10.5
NON-COMPETITION AGREEMENT
THIS AGREEMENT is made this 1st day of September, 2002, between
COMMERCE DEVELOPMENT CORPORATION, LTD., a Maryland corporation (the "Company"),
and XXXXXX X. XXXXXX (the "Employee").
WHEREAS, the Employee and the Company have executed that certain
Employment Agreement of even date herewith (the "Employment Agreement");
NOW, THEREFORE, in consideration of the foregoing and the following
mutual covenants and agreements, the parties hereto do hereby agree as follows:
1. Payment to the Employee. Contemporaneously with the execution and delivery of
this Agreement, and in full and final payment of all obligations of the Company
to the Employee hereunder, there has been delivered to the Employee 10,000,000
shares of the Company's common stock, par value $0.001 per share, the receipt
and sufficiency of which are hereby acknowledged by the Employee. It is agreed
by the parties that the shares of the Company's common stock delivered to the
Employee hereunder have been value at $0.006 per share. Consequently, the
Employee has received consideration in the amount of $60,000 in connection with
this Agreement.
2. Covenant Not to Compete. The Employee hereby covenants and agrees with the
Company that during the period which is 16 months after the termination of his
employment, for any reason, with or without cause, the Employee will not, except
as expressly permitted hereunder, directly or indirectly:
(a) Operate, develop or own any interest other than the ownership of less than
five percent of the equity securities of a publicly traded company, in any
business which has significant activities (viewed in relation to the business of
the Company or its affiliates), or has announced intentions to focus significant
resources, relating to any business in which the Company or its affiliates is
currently engaged and the business of building, owning, and managing a business
consulting firm, or other similar entities (a "Business");
(b) Compete with the Company or its affiliates in the operation or
development of any Business within North America (Canada, Mexico, and the
United States of America);
(c) Be employed by any business which owns,manages, or operates a Business;
(d) Interfere with, solicit, disrupt or attempt to disrupt any past, present or
prospective relationship, contractual or otherwise, between the Company or its
affiliates, and any customer, client, supplier or employee of the Company or its
affiliates; or
(e) Solicit any employee of the Company or its affiliates to leave his
employment with the Company or its subsidiaries or affiliates, as the case may
be, or hire any such employee to work for a Business.
The Employee shall not be entitled to circumvent the provisions of this
Agreement by entering into a relationship with a Business as a consultant,
director, adviser, or otherwise, which has the effect of competing with the
Company, its affiliates or subsidiaries.
This covenant on the part of the Employee shall be construed as an
agreement independent of any other provision of this Agreement and the existence
of any claim or cause of action by the Employee against the Company, whether
predicated on this Agreement or otherwise, shall not constitute a defense to the
enforcement by the Company of this covenant.
3. Remedies for Breach. If the Employee commits a breach, or threatens to commit
a breach, of any of the provisions of this Agreement, the Company shall have the
following rights and remedies, in addition to any others, each of which shall be
independent of the other and severally enforceable:
(a) The right to have the provisions of this Agreement specifically enforced by
any court having equity jurisdiction, it being acknowledged and agreed that any
such breach or threatened breach will cause irreparable injury to the Company
and that money damages will not provide an adequate remedy to the Company; and
(b) The right and remedy to require the Employee to account for and pay over to
the Company all compensation, profits, monies, accruals, increments, or other
benefits (the "Benefits") derived or received by the Employee as a result of any
transactions constituting a breach of any of the provisions of this Agreement,
the Employee agreeing to account for and pay over the Benefits as provided
above.
4. Attorney's Fees. In the event that it should become necessary for any party
entitled hereunder to bring suit against any other party to this Agreement for
enforcement of the covenants herein contained, the parties hereby covenant and
agree that the party who is found to be in violation of said covenants shall
also be liable for all reasonable attorney's fees and costs of court incurred by
the other parties hereto.
5. Benefit. All the terms and provisions of this Agreement shall be
-------
binding upon and inure to the benefit of and be enforceable by the parties
hereto, and their respective heirs, executors, administrators, personal
representatives, successors and permitted assigns.
6. Notice. All notices, requests and other communications hereunder shall be in
writing and shall be deemed to have been duly given at the time of receipt if
delivered by hand or communicated by electronic transmission, or, if mailed,
three days after deposit in the United States mail, registered or certified,
return receipt requested, with postage prepaid and addressed to the party to
receive same, if to the Company, addressed to the President of the Company at
0000 Xxx Xxx Xxxxx Xxxxx, 0xx Xxxxx, Xxx Xxxxx, Xxxxxxxxxx 00000, telephone
(000) 000-0000, fax (000) 000-0000, and e-mail xxxx@xxxxx.xxx; and if to the
Employee, addressed to Xx. Xxxxxx X. Xxxxxx at 0000 Xxxxxxxxxx Xxxx Xxxxxxxxx,
Xxxxx 000, Xxx Xxxxx, Xxxxxxxxxx 00000, telephone (000) 000-0000, fax (858)
000-0000, and e-mail XXXX0@xxx.xxx; provided, however, that if either party
shall have designated a different address by notice to the other given as
provided above, then any subsequent notice shall be addressed to such party at
the last address so designated.
7. Construction. Words of any gender used in this Agreement shall be held and
construed to include any other gender, and words in the singular number shall be
held to include the plural, and vice versa, unless the context requires
otherwise. In addition, the pronouns used in this Agreement shall be understood
and construed to apply whether the party referred to is an individual,
partnership, joint venture, corporation or an individual or individuals doing
business under a firm or trade name, and the masculine, feminine and neuter
pronouns shall each include the other and may be used interchangeably with the
same meaning.
8. Waiver. No course of dealing on the part of any party hereto or its agents,
or any failure or delay by any such party with respect to exercising any right,
power or privilege of such party under this Agreement or any instrument referred
to herein shall operate as a waiver thereof, and any single or partial exercise
of any such right, power or privilege shall not preclude any later exercise
thereof or any exercise of any other right, power or privilege hereunder or
thereunder.
9. Cumulative Rights. The rights and remedies of any party under this
------------------
Agreement and the instruments executed or to be executed in connection
herewith, or any of them, shall be cumulative and the exercise or partial
exercise of any such right or remedy shall not preclude the exercise of any
other right or remedy.
10. Invalidity. If a judicial determination is made that any of the provisions
of this Agreement constitutes an unreasonable or otherwise unenforceable
restriction against the Employee, the provisions of this Agreement shall be
rendered void only to the extent that such judicial determination finds such
provisions to be unreasonable or otherwise unenforceable. In this regard, the
parties hereto hereby agree that any judicial authority construing this
Agreement shall be empowered to sever any portion of the territory or prohibited
business activity from the coverage of this Agreement and to apply the
provisions of this Agreement to the remaining portion of the territory or the
remaining business activities not so severed by such judicial authority.
Moreover, notwithstanding the fact that any provisions of this Agreement are
determined not to be specifically enforceable, the Company shall nevertheless be
entitled to recover monetary damages as a result of the breach of such provision
by the Employee. The time period during which the prohibitions set forth in this
Agreement shall apply shall be tolled and suspended as to the Employee for a
period equal to the aggregate quantity of time during which the Employee
violates such prohibitions in any respect.
11. Headings. The headings used in this Agreement are for convenience and
--------
reference only and in no way define, limit, simplify or describe the scope or
intent of this Agreement, and in no way effect or constitute a part of this
Agreement.
12. Multiple Counterparts. This Agreement may be executed in one or
----------------------
more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
13. Law Governing. This Agreement shall be construed and governed by the
-------------
laws of the State of California, and all obligations hereunder shall be deemed
performable in San Diego County, California.
14. Entire Agreement. This instrument contains the entire understanding
-----------------
of the parties with respect to the subject matter hereof, and may not be
changed orally, but only by an instrument in writing signed by the party
against whom enforcement of any waiver, change, modification, extension, or
discharge is sought.
IN WITNESS WHEREOF, the parties have executed this Agreement effective
as of the date first written above.
COMMERCE DEVELOPMENT CORPORATION, LTD.
By /s/ Xxxxxx Xxxxxx
--------------------------------------
Xxxxxx Xxxxxx, Chief Financial Officer
By /s/ Xxxxxx X. Xxxxxx
--------------------------------------
XXXXXX X. XXXXXX
