AGREEMENT
This Agreement made and entered into this ____ day of _______,
1997, by and between XXXXXX X. XXXXXXXXXX (hereinafter referred to
as "Owner") and XXXXXXX COMPUTER RESOURCES, INC., a Delaware
corporation (hereinafter referred to as "Purchaser").
W I T N E S S E T H :
WHEREAS, simultaneously with the execution of this Agreement,
Purchaser entered into an Asset Purchase Agreement ("Asset
Purchase Agreement") with Microcare, Inc., an Indiana corporation
(hereinafter referred to as "Seller 1"), and Microcare Computer
Services, Inc., an Indiana corporation (hereinafter referred to as
"Seller 2") for the acquisition of substantially all of the assets
of Seller 1 and Seller 2 relating to their businesses of providing
a variety of computer service and support solutions to large and
medium size commercial, governmental and other professional
customers throughout the Indianapolis, Indiana metropolitan area
as well the entire state of Indiana (both businesses collectively
referred to as the "Business"); and
WHEREAS, Owner owns one hundred percent (100%) percent of the
outstanding stock of Seller 1 and Seller 2; and
WHEREAS, Purchaser would not have entered into the Asset Purchase
Agreement with Seller 1 and Seller 2 without the consent of Owner
to enter into this covenant not to compete agreement; and
WHEREAS, pursuant to Sections 8 and 13.2(d)(vii) of said Asset
Purchase Agreement, Owner agreed to enter into this Agreement;
NOW, THEREFORE, in consideration of the mutual promises and
covenants herein contained and in consideration of the execution
and closing of the Asset Purchase Agreement, the parties hereto
agree as follows:
1. As an inducement for Purchaser to enter into the Asset
Purchase Agreement with Seller 1 and Seller 2 (100% of the stock
of which is owned by Owner), Owner covenants and agrees that for a
period equal to the later of (i) four (4) years from the closing
of the Asset Purchase Agreement of even date herewith or (ii) one
(1) year after the termination of Owner's employment with
Purchaser under an Employment Agreement executed by and between
the Owner and the Purchaser of even date herewith, Owner will not,
or with any other person, corporation or entity, directly or indi
rectly, by stock or other ownership, investment, management,
employment or otherwise, or in any relationship whatsoever:
(a) Solicit, divert or take away, or attempt to solicit,
divert or take away, any of the business, clients, customers or
patronage of Purchaser or any affiliate or subsidiary thereof
relating to the Business of Purchaser, as defined below;
(b) Attempt to seek or cause any clients or customers of
Purchaser or any such affiliate or subsidiary relating thereto to
refrain from continuing their patronage of the Business of
Purchaser;
(c) Engage in the Business of Purchaser in any state, county
and/or metropolitan area in which Purchaser or its subsidiaries do
business during the term of this Agreement. A list of the states
in which Purchaser and its subsidiaries currently transact
business is attached hereto as Exhibit A;
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(d) Knowingly employ or engage, or attempt to employ or
engage, in any capacity, any person in the employ of the Purchaser
or any affiliate or subsidiary;
(e) Nothing in this Agreement shall prohibit Owner from
owning or purchasing less than five percent (5%) of the
outstanding stock of any publicly traded company whose stock is
traded on a nationally or regionally recognized stock exchange or
is quoted on NASDAQ or the OTC Bulletin Board.
For purposes of this Section, the "Business of Purchaser"
shall mean any person, corporation, partnership or other legal
entity engaged, directly or indirectly, through subsidiaries or
affiliates, in the following line of business:
(i) Distributing of computer hardware, software, peripheral
devices, and related products and services to other entities or
persons engaged in any manner in the business of the distribution,
sale, resale or servicing, whether at the wholesale or retail
level, or leasing or renting, of computer hardware, software,
peripheral devices or related products;
(ii) Sale or servicing, whether at the wholesale or retail
level, or leasing or renting, of computer hardware, software,
peripheral devices or related products; and
(iii) Sale or servicing of microcomputer products and
computer integration products, peripheral devices and related
products and the sale of microcomputer products and computer
integration and networking services.
Owner has carefully read all the terms and conditions of this
Paragraph 1 and has given careful consideration to the covenants
and restrictions imposed upon Owner herein, and agrees that the
same are necessary for the reasonable and proper protection of the
Business of Seller 1 and Seller 2 acquired by Purchaser and have
been separately bargained for and agrees that Purchaser has been
induced to enter into the Asset Purchase Agreement and pay the
consideration described in Paragraph 2 by the representation of
Owner that he will abide by and be bound by each of the covenants
and restrictions herein; and Owner agrees that Purchaser will
suffer irreparable injury in the event of a breach by Owner, and
Owner agrees that Purchaser is entitled to injunctive relief in
the event of any breach of any covenant or restriction contained
herein in addition to all other remedies provided by law or
equity. Owner hereby acknowledges that each and every one of said
covenants and restrictions is reasonable with respect to the
subject matter, the line of business, the length of time and
geographic area embraced therein, and agrees that irrespective of
when or in what manner this agreement may be terminated, said
covenants and restrictions shall be operative during the full
period or periods hereinbefore mentioned and throughout the area
hereinbefore described.
The parties acknowledge that this Agreement, which Agreement
is ancillary to the main thrust of the Asset Purchase Agreement,
is being entered into to protect a legitimate business interest of
Purchaser including, but not limited to, (i) trade secrets; (ii)
valuable confidential business or professional information that
otherwise does not qualify as trade secrets; (iii) substantial
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relationships with specific prospective or existing customers or
clients; (iv) client or customer good will associated with an
ongoing business by way of trade name, trademark, service xxxx, or
trade dress, a specific geographic location, or a specific
marketing or trade area; and (v) extraordinary or specialized
training. In the event that any provision or portion of this Para
graph 1 shall for any reason be held invalid or unenforceable, it
is agreed that the same shall not affect the validity or
enforceability of any other provision of Paragraph 1 of this
Agreement, but the remaining provisions of Paragraph 1 of this
Agreement shall continue in force and effect; and that if such
invalidity or unenforceability is due to the reasonableness of the
line of business, time or geographical area covered by certain
covenants and restrictions contained in Paragraph 1, said
covenants and restrictions shall nevertheless be effective for
such line of business, period of time and for such area as may be
determined by arbitration or by a Court of competent jurisdiction
to be reasonable.
2. The consideration for Owner's covenant not to compete shall
be One Dollar ($1.00) and other valuable consideration, including
consideration paid by the Purchaser to Seller 1 and Seller 2
pursuant to an Asset Purchase Agreement to which Owner is a party
of even date herewith.
3. The terms and conditions of this Agreement shall be binding
upon the Owner and Purchaser, and their successors, heirs and
assigns.
IN WITNESS WHEREOF, the parties hereto have executed this Agree
ment on the day and year first above written.
OWNER:
__________________________________
XXXXXX X. XXXXXXXXXX
PURCHASER:
XXXXXXX COMPUTER RESOURCES, INC.
By:________________________________
EXHIBIT A
STATES IN WHICH PURCHASER
AND/OR ITS SUBSIDIARIES TRANSACT BUSINESS
1. Alabama
2. Florida
3. Indiana
4. Iowa
5. Kentucky
6. North Carolina
7. Ohio
8. South Carolina
9. Tennessee
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