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EXHIBIT 10.3
NON-COMPETITION AND NON-DISCLOSURE AGREEMENT
THIS NON-COMPETITION AND NON-DISCLOSURE AGREEMENT is dated as of May 2,
1997, by and between HALIS, Inc., a Georgia corporation ("Buyer"), and XXXXXX X.
XXXXX, an individual resident of Georgia ("Principal").
W I T N E S S E T H:
WHEREAS, Buyer, TG Marketing Systems Acquisition Co., a wholly-owned
subsidiary of Buyer, Principal, TG Marketing Systems, Inc., a Georgia
corporation (the "Company"), and Principal have entered into that certain
Agreement and Plan of Merger and Reorganization, dated as of May 2, 1997 (the
"Merger Agreement"), providing for the merger of the Company with and into TG
Marketing Systems Acquisition Co. (the "Merger"); and
WHEREAS, the Principal is the sole shareholder and an executive officer of
the Company, and such position has placed the Principal in a position of
confidence and trust with respect to the Company; and
WHEREAS, the Merger Agreement requires that Principal enter into this
Agreement as a condition precedent to the Merger; and
WHEREAS, in consideration of Buyer's covenants in the Merger Agreement and
to induce Buyer to consummate the Merger, the Principal is willing to enter into
this Agreement and to comply with the restrictive covenants contained herein.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
of the parties hereto, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
(i) Definitions. The following terms shall have the
meanings set forth below for purposes of this Agreement:
(i) The term "Area" shall mean the
United States of America, its
territories and possessions.
(ii) The term "Confidential Information"
shall mean and include any information,
data and know-how relating to the Company
and not generally within the public
domain (whether constituting a trade
secret or not) including
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without limitation the following
information;
1) financial information, such as
the earnings, assets, debts, prices,
fee structures, projections,
budgets, margins, tax information or
other financial data of the Company,
whether relating to the Company
generally, or to particular products,
services, geographic areas or time
` periods;
2) product and service information,
such as information concerning the
goods and services used or purchased
by the Company, products, plans,
specifications, formulae, know-how,
techniques, codes, development plans,
manuals, the identities of suppliers
and consultants, terms of supply and
consulting contracts, or of
particular transactions, or related
information about potential suppliers
and consultants, to the extent that
such information is not generally
known to the public, and to the
extent that the combination of
suppliers or use of a particular
supplier or consultant, though
generally known or available, yields
advantages to the Company the details
of which are not generally known;
3) marketing information, such as
details about ongoing or proposed
marketing programs, strategies or
agreements by or on behalf of the
Company, marketing forecasts or
strategies or results of marketing
efforts or information about
impending transactions;
4) personnel information, such as
employees' personal or medical
histories, compensation or other
terms of employment, actual or
proposed
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promotions, hirings, resignations,
disciplinary actions, terminations or
reasons therefor, training methods,
performance, or other employee
information;
5) customer information, such as
any compilations or lists of past,
existing or prospective customers,
proposals, bids or agreements between
customers and the Company, status of
customer accounts or credit, or
related information about actual or
prospective customers; and
6) operations information, such as
software, systems, techniques used
and developed by the Company,
including accounting systems, payroll
systems, operations manuals and
personnel manuals.
The term "Confidential Information" does not include information that has become
generally available to the public by the act of one who has the right to
disclose such information without violating any right of the Company.
(iii) The term "Competing Business" shall
mean and include any proprietorship,
partnership, joint venture, business
trust, corporation, association or other
entity or person (other than the Buyer
and any successor of Buyer) engaged at
the time of such determination in the
business of developing, licensing,
marketing, distributing or selling
health care management systems and
support services.
(iv) The term "Customer" or "Customers"
shall mean any person, partnership,
association, firm, corporation or other
entity which as of the date hereof has
purchased any services or products from
the Company or Buyer or which has been
actively sought as a prospective
customer of the Company.
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(ii) Acknowledgments. The Principal acknowledges
that this Agreement is being executed and delivered ancillary to the sale of the
Company's stock for separately bargained-for consideration. The Principal
further acknowledges that the Company is a highly competitive business, strongly
dependent upon personal contacts with Customers and potential Customers and the
establishment of trust and confidence in relationships between the owners and
executive officers of the Company and its Customers. The Principal agrees that
the Buyer would suffer great loss and damage if the Principal, on Principal's
own behalf or on behalf of any Competing Business, were to engage in a business
competitive with the Company.
(iii) Covenants. Recognizing the Buyer's need to
protect its legitimate business interests, including the goodwill of the
Company, and to induce the Buyer to enter into and perform its obligations under
the Merger Agreement, Principal covenants and agrees with the Buyer as follows:
(i) that Principal will not from the
date of this Agreement until ten (10)
years following the date hereof, for
whatever reason, either directly or
indirectly:
1) within the Area, solicit the
sale or lease on Principal's own
behalf or in the service of or on
behalf of any Competing Business, any
product or service similar to or in
competition with the existing
products or services of the Company
or any successor to the business of
the Company;
2) within the Area, either directly
or indirectly, engage, participate,
invest in (other than to hold 1% or
less of any class of securities of a
public company) or assist, as owner,
part-owner, stockholder, partner,
director, officer, trustee, employee,
agent, consultant or any other
capacity, any Competing Business;
3) solicit or attempt to solicit,
directly or by assisting others, any
business from a Customer of the
Company with whom Principal had
material contact for
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purposes of providing products or
services in the Area in competition
with the existing products or
services of the Company;
4) employ or attempt to employ or
assist anyone else in employing in
any Competing Business any employee,
or any person who was an employee at
any time during the previous 12
months, of the Buyer (whether or not
such employment is full or part time
or pursuant to a written or oral
contract).
ii) that Principal will not for a
period of ten (10) years from the date
hereof, for whatever reason, disclose or
use or otherwise exploit for Principal's
own benefit, for the benefit of any
other person, or for the benefit of any
Competing Business, any Confidential
Information; provided, however, that to
the extent any Confidential Information
constitutes a trade secret under
applicable law, the restrictions
contained in this Section 3(b) shall
continue to apply for so long as such
information remains a trade secret.
(iv) Remedies. Principal acknowledges that
irreparable loss and injury would result to the Buyer upon any
breach of any of the covenants contained in this Agreement and
that damages arising out of such breach would be difficult to
ascertain. Principal agrees that, in addition to all other
remedies provided at law or in equity, the Buyer may petition
and obtain from a court of law or equity, without bond, both
temporary and permanent injunctive relief to prevent a breach
by Principal of any such covenant.
(v) Miscellaneous.
(i) The terms and provisions of this
Agreement shall inure to the benefit of
and be binding upon Buyer, and its
successors and assigns, and upon the
Principal and Principal's heirs and
personal representatives. The rights of
the Buyer hereunder may be assigned by
Buyer to any successor to the business
of the
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Company, whether by merger, sale of
stock, sale of assets or other
transaction.
(ii) This Agreement constitutes the entire
Agreement between the parties hereto
concerning the subject matter hereof;
provided, however, that the restrictive
covenants contained in Sections 7 and 8
of that certain Employment Agreement, of
even date herewith, by and between the
Principal and TG Marketing Systems
Acquisition Co., shall be supplemental
to the covenants contained in this
Agreement. This Agreement shall not be
altered, modified, amended or terminated
except by written instrument executed by
the parties hereto.
(iii) This Agreement, and the rights and
liabilities of the parties hereto, shall
be construed in all respects in
accordance with the laws of the State of
Georgia.
(iv) The covenants contained in this
Agreement are separate and severable and
the invalidity or unenforceability of
any one or more covenants, shall not
affect the validity or enforceability of
any other covenant contained herein. It
is the intention of the parties hereto
that the provisions of this Agreement
shall be enforced to the fullest extent
permissible under the laws and public
policies of each jurisdiction in which
such enforcement is sought, but that the
enforceability (or judicial modification
to conform with such laws and public
policies, which the parties hereby
expressly authorize), of any provision
hereof shall not render unenforceable or
impair the remainder of this agreement,
which shall be deemed amended to delete
or modify, as necessary, the invalid or
unenforceable portions. The parties
hereto acknowledge and agree that for
purposes of judicial interpretation or
enforcement of this Agreement, this
Agreement shall be deemed to have been
executed and delivered ancillary to the
sale of a business.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
"BUYER"
HALIS, INC.
By: /s/ Xxxxx Xxxxxx
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Xxxxx Xxxxxx, President
"PRINCIPAL"
/s/ Xxxxxx X. Xxxxx (SEAL)
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XXXXXX X. XXXXX
