NON-COMPETITION, NON-DISCLOSURE, AND NON-SOLICITATION AGREEMENT
NON-COMPETITION,
NON-DISCLOSURE,
AND
NON-SOLICITATION AGREEMENT
This
Non-Competition, Non-Disclosure and Non-Solicitation Agreement
(“Agreement”), dated this _______ day of December 2010 (the “Effective Date”),
by and between ___________________________________ (“Holder”) and Piper
Acquisition III, Inc., a Nevada corporation (the
“Purchaser”).
RECITALS
A. Pursuant
to the Contribution Agreement by and among the Purchaser, First Street Hospital,
L.P. (“Hospital”), First Surgical Woodlands, L.P. (“Woodlands”), First Street
Surgical Center, L.P. (“Surgical Center”), First Surgical Partners, L.L.C.
(“Partners” and together with Hospital, Woodlands and Surgical Center, the
“Entities”) the Purchaser is acquiring the Entities and the Holder is acquiring
shares of common stock of Purchaser (the “Contribution Agreement”).
X. Xxxxxx
has been a partner in one or more of the Entities for many years and has
developed and received special, unique and extraordinary knowledge, information
and goodwill in connection therewith.
C. It
is a condition precedent to the consummation of the transactions contemplated by
the Contribution Agreement, and an inducement to the Purchaser to enter into the
Contribution Agreement and effect the purchase of the Entities and their
respective businesses thereunder and the goodwill represented thereby, that the
parties hereto execute and deliver this Agreement.
D. Capitalized
terms used in this Agreement and not otherwise defined shall have the meanings
assigned to them in the Contribution Agreement.
NOW,
THEREFORE, in consideration of the foregoing premises and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Non-Competition;
Non-Solicitation. Commencing on the date hereof and ending on
the last day of the Restricted Period (as defined below), Holder covenants and
agrees that he will not, without the Purchaser’s prior written consent, directly
or indirectly, either on behalf of himself or on behalf of any business venture,
as an employee, consultant, partner, principal, stockholder, officer, director,
trustee, agent, or otherwise (other than on behalf of the Purchaser or its
Affiliates):
(A) be
employed by, engage or participate in the ownership, management, operation or
control of, or act in any advisory, expert, consulting or other capacity for,
any entity or individual that owns, operates, manages or controls a medical
facility (the “Competing Facility”) that competes with the Purchaser or its
Affiliates and that is located in a county in which one of Purchaser’s or
Purchaser’s Affiliate’s facilities is located or a county immediately adjacent
to a county in which one of Purchaser’s or Purchaser’s Affiliate’s facilities is
located;
(B) solicit
or divert any business or any customer from the Purchaser or its Affiliates or
assist any person, firm, corporation or other entity in doing so or attempting
to do so;
(C) cause
or seek to cause any person, firm or corporation to refrain from dealing or
doing business with the Purchaser or its Affiliates or assist any person, firm,
corporation or other entity in doing so; or
(D) hire,
solicit or divert from the Purchaser or its Affiliates any of their respective
employees, consultants or agents who have, at any time during the immediately
preceding one (1) year period from the date hereof or during the Restricted
Period, been engaged by the Purchaser or its Affiliates, nor assist any person,
firm, corporation or other entity in doing so.
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As used
in this Agreement, the term “Affiliates” shall mean any entity controlling,
controlled by or under the common control of the Purchaser. For the purpose of
this Agreement, “control” shall mean the direct or indirect ownership of thirty
(30%) percent or more of the outstanding shares or other voting rights of an
entity or possession, directly or indirectly, of the power to direct or cause
the direction of management and policies of an entity.
As used
in this Agreement, “Restricted Period” means the period commencing on the date
hereof and ending two (2) years from the date that the Holder ceases to be a
shareholder of the Company or its successors.
2. Nondisclosure. Holder
understands and agrees that the business of the Purchaser and its Affiliates is
based upon specialized work and Confidential Information (as hereinafter
defined). Holder agrees that during the Restricted Period, he shall keep secret
all such Confidential Information and that he will not, directly or indirectly,
use for his own benefit or for the benefit of others nor Disclose (as
hereinafter defined), without the prior written consent of the Purchaser, any
Confidential Information. At any time upon the Purchaser’s request, Holder shall
turn over to the Purchaser all books, notes, memoranda, manuals, notebooks,
records and other documents made, compiled by, delivered to, or in the
possession or control of Holder containing or concerning any Confidential
Information, including all copies thereof, in any form or format, including any
computer hard disks, wherever located, containing any such information, it being
agreed that the same and all information contained therein are at all times the
exclusive property of the Purchaser and its Affiliates.
As used
in this Agreement, the term “Confidential Information” means any information or
compilation of information not generally known to the public or the industry,
that is proprietary or confidential to the Purchaser, its Affiliates and/or
those doing business with the Purchaser and/or its Affiliates, including but not
limited to know-how, process, techniques, methods, plans, specifications, trade
secrets, patents, copyrights, supplier lists, customer lists, mailing lists,
financial information, business plans and/or policies, methods of operation,
sales and marketing plans and any other information acquired or developed by
Holder in the course of his past, present and future dealings with the Purchaser
and its Affiliates, which is not readily available to the public.
“Confidential
Information” does not include any information, datum or fact: (a) currently
available to the public as of the date hereof; (b) after it becomes available to
the public other than as a result of a breach hereof or other wrongful conduct
by Holder; (c) after it becomes available to Holder on a non-confidential basis
from a source other than the Company or its Affiliates or a person or entity
breaching his or its confidentiality agreement or other relationship of
confidence with the Company or its Affiliates; (d) developed independently by
Holder without any reference to or use whatsoever of any Confidential
Information of the Company or its Affiliates; or (e) if Holder is compelled by
court or government action pursuant to applicable law to disclose such
information.
As used
in this Agreement, the term “Disclose” means to reveal, deliver, divulge,
disclose, publish, copy, communicate, show, allow or permit access to, or
otherwise make known or available to any third party, any of the Confidential
Information.
3. Blue
Pencil Doctrine. In the event that the restrictive covenants
contained in Section 1 and/or Section 2 of this Agreement shall be found by a
court of competent jurisdiction to be unreasonable by reason of such restrictive
covenants extending for too great a period of time or over too great a
geographic area or by reason of such restrictive covenants being too extensive
in any other respect, then such restrictive covenant shall be deemed modified to
the minimum extent necessary to make such restrictive covenant reasonable and
enforceable under the circumstances.
4. Injunctive
Relief. If Holder shall breach or threaten to breach any of
the provisions of Section 1 and/or Section 2, in addition to and without
limiting any other remedies available to the Purchaser at law or in equity, the
Purchaser shall be entitled to seek immediate injunctive relief in any court to
restrain any such breach or threatened breach and to enforce the provisions of
Section 1 and/or Section 2, as the case may be. Holder acknowledges and agrees
that there is no adequate remedy at law for any such breach or threatened breach
and, in the event that any proceeding is brought seeking injunctive relief,
Holder shall not use as a defense thereto that there is an adequate remedy at
law.
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5. Reasonableness
of Covenants. Holder acknowledges and agrees that the
restrictive covenants contained in this Agreement are a necessary inducement to
Purchaser purchasing Holder’s ownership interests in the Entities, and that the
scope (geographic and otherwise) and period of duration of the restrictive
covenants contained in this Agreement are both fair and reasonable and that the
interests sought to be protected by the Purchaser are legitimate business
interests entitled to be protected. Holder further acknowledges and agrees that
the Purchaser would not have purchased Holder’s ownership interests in the
Entities pursuant to the Contribution Agreement unless Holder entered into this
Agreement.
6. General
Provisions.
(A) Entire
Agreement. This Agreement, together with the Contribution
Agreement and any other agreements contemplated thereby, contain the entire
agreement of the parties hereto with respect to the subject matter hereof, and
supersede all prior or contemporaneous agreements and understandings, oral or
written, among the parties hereto and thereto with respect to the subject matter
hereof and thereof.
(B) Amendment;
Waiver. No amendment or waiver of any provision of this
Agreement shall be effective unless the same shall be in writing and signed by
all of the parties and then such waiver shall only be effective in the specific
instance and for the specific purpose for which it was given.
(C) Notices. All
notices and other communications under this Agreement shall be in writing and
shall be given in accordance with the notice provisions of the Contribution
Agreements.
(D) Assignment. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective heirs, personal representative(s), successors and permitted
assigns. This Agreement may be assigned to, and thereupon shall inure to the
benefit of, any organization which succeeds to substantially all of the business
or assets of the Purchaser, whether by means of merger, consolidation,
acquisition of all or substantially all of the assets of the Purchaser or
otherwise, including, without limitation, by operation of law.
(E) Governing
Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas applicable to agreements made and
to be performed in that state, without regard to any of its principles of
conflicts of laws or other laws that would result in the application of the laws
of another jurisdiction. This Agreement shall be construed and interpreted
without regard to any presumption against the party causing this Agreement to be
drafted. Each of the parties hereby unconditionally and irrevocably waives the
right to a trial by jury in any action, suit or proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby. Each of the
parties unconditionally and irrevocably consents to the exclusive jurisdiction
of the courts of the State of Texas located in the City of Houston and the
Federal district court for the Southern District of Texas located in Xxxxxx
County with respect to any suit, action or proceeding arising out of or relating
to this Agreement or the transactions contemplated hereby, and each of the
parties hereby unconditionally and irrevocably waives any objection to venue in
any such court.
(F) Recovery of Attorneys’ Fees
and Costs. If any action for breach of or to enforce the
provisions of this Agreement is commenced, the court in such action shall award
to the party in whose favor a judgment is entered, a reasonable sum as
attorneys’ fees and costs. Such attorneys’ fees and costs shall be paid by the
non-prevailing party in such action.
(G) Headings. The
headings to the paragraphs of this Agreement are intended for the convenience of
the parties only and shall in no way be held to explain, modify, amplify or aid
in the interpretation of the provisions hereof.
(H) Severability. The
provisions of this Agreement shall be deemed severable and if any portion hereof
shall be held invalid, illegal or unenforceable for any reason by a court of
competent jurisdiction, the remainder shall not thereby be invalidated but shall
remain in full force and effect.
(I) Counterparts. This
Agreement may be executed in counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the same
agreement.
(J) Referrals. Nothing
in this Agreement limits the ability of Holder refer patients to any
facility.
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(K) Compliance with Business and
Commerce Code. To the extent that this agreement does not
qualify for an exception from the provisions of Tex.
Bus. & Comm. Code § 15.50(b) pursuant to Tex.
Bus. & Comm. Code § 15.50(c): (i) this Agreement will not
deny Holder access to a list of Holder’s patients whom Holder had seen or
treated within one year of termination of the contract or employment; (ii)
Holder shall have access to medical records of Holder’s patients upon
authorization of the patient and any copies of medical records for a reasonable
fee as established by the Texas Medical Board under Section 159.008, Occupations
Code; (iii) any access to a list of patients or to patients’ medical records
after termination of the contract or employment shall not require such list or
records to be provided in a format different than that by which such records are
maintained except by mutual consent of the parties to the contract; (iv) Holder
will not be prohibited from providing continuing care and treatment to a
specific patient or patients during the course of an acute illness even after
the contract or employment has been terminated; and (v) the covenant not to
compete of this Agreement may be bought out by Holder for a reasonable price
determined by a mutually agreed upon arbitrator or, in the case of an inability
to agree, an arbitrator of the court whose decision shall be binding on the
parties.
In Witness
Whereof, the parties hereto have executed this Agreement as of the date
first set forth above.
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