BUSINESS PROTECTION AGREEMENT - ATPA
Exhibit
10.20
THIS
BUSINESS PROTECTION AGREEMENT ("Agreement") is made this 27th
day of
February, 2008, by and between BENEFITS TECHNOLOGIES, LLC, a Delaware limited
liability company (the "Company") and ASSOCIATED THIRD PARTY ADMINISTRATORS,
a
California corporation ("ATPA").
BACKGROUND
The
Company, contemporaneously with the execution of this Agreement, is acquiring
certain assets of ATPA and certain other companies.
The
Company desires to assure, among other things, that it will be able to establish
a relationship with ATPA's customers and continue ATPA's business without any
interference from ATPA.
For
purposes of this Agreement, the Company includes the Company and the Company’s
parents, subsidiaries, affiliates, successors and assigns.
Therefore,
pursuant to the terms of the Asset Contribution and Combination Agreement by
and
among ATPA, the Company, Trust Benefits Online, LLC (“TBOL”), Information
Concepts, Inc. (“ICI”), Xxxxx Xxxxxxxxxx, Xxxxxx X. Xxxxxx and Xxxxx X. Xxxxxx
dated January 31, 2008 (the "Purchase Agreement"), and as a condition of
the Company's acquisition of certain of the assets of ATPA, the Company has
required that this Agreement be executed.
NOW
THEREFORE, for good and valuable consideration, the receipt and sufficiency
of
which is hereby acknowledged, the parties, intending legally to be bound, agree
as follows:
1. RESTRICTIVE
COVENANT.
1.1 Definitions.
1.1.1 "Customer":
Any
Person to which ICI, TBOL, ATPA or the Company has sold products or rendered
services at any time during the twenty-four (24) month period immediately
preceding the date of this Agreement.
1.1.2 "Person":
An
individual, firm, corporation or other entity, and/or any principal, agent,
employee, stockholder, partner, officer, member, or director
thereof.
1.1.3 "Prospective
Customer":
Any
Person which has been actively solicited to purchase products or services from
ICI, TBOL, ATPA or the Company at any time during the twenty-four (24) month
period immediately preceding the date of this Agreement.
1.1.4 "Referral
Source":
A
Person who has referred customers to ICI, TBOL, ATPA or the Company at any
time
during the twenty-four (24) month period immediately preceding the date of
this
Agreement.
1.2 Restrictions.
For a
period of sixty (60) months immediately following the date of this Agreement,
ATPA shall not, directly or indirectly, for itself, or on behalf of any other
person, firm, corporation or other entity, whether as principal, agent,
employee, independent contractor, stockholder, joint venturer, partner, officer,
member, director, sole proprietor, or otherwise:
1.2.1 Customers
or Prospective Customers.
Call
upon or otherwise communicate with any Customer or Prospective Customer for
the
purpose of rendering or offering to render services in competition with those
rendered by the Company, or render such services to the Customer or Prospective
Customer.
1.2.2 Referral
Sources.
Call
upon or communicate with any Referral Source for the purpose of soliciting
the
referral of customers or potential customers for services in competition with
those rendered by the Company to any Person other than the Company.
1.2.3 Other
Employees.
Solicit, participate in or promote the solicitation of any person who is
employed by the Company on the date of this Agreement or who is employed by
the
Company on or after the date of this Agreement to leave the employ of the
Company or hire or engage any person who was employed by the Company at any
time
during the twenty-four (24) months preceding the date of this Agreement or
who
is employed by the Company on or after the date of this Agreement.
1.2.4 Disparaging
Remarks.
Make
any disparaging remarks about the Company's business, products, services or
personnel.
1.2.5 Interference.
Interfere in any way with the Company's business, prospects or
personnel.
1.2.6 Modification.
ATPA
acknowledges that the covenants contained in Section 1
are
necessary in order to protect the goodwill of the Company's business and that
those covenants are reasonable. However, if any court determines that any
restriction set forth in Section 1
is
unenforceable in accordance with its terms regarding duration, geographical
limit, or scope of prohibited activity, then the covenant shall not terminate.
Instead, with respect to its operation in the jurisdiction of the court which
makes the adjudication, the covenant shall be deemed to have been amended to
the
extent required to render it valid and enforceable. The adjudication shall
not
be deemed to affect the validity or enforceability of the covenant in any
jurisdiction other than the one in which the adjudication is made.
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1.2.7 Retention
by Company.
Nothing
in this Agreement shall prohibit or restrict ATPA from performing the prohibited
activities under this Agreement for the Company, should ATPA be retained by
the
Company.
2. REMEDIES.
2.1 Extension.
If ATPA
violates any covenant contained in Section 1,
then
the Company shall not be deprived of the full benefit of the period of the
covenant. Accordingly, the duration of the covenant shall be extended by the
period of any violation of the covenant.
2.2 Bond.
The
Company shall not be required to post a bond or any similar assurance if it
brings any action in order to enforce any of the covenants contained in
Section 1.
2.3 Relief.
In the
event of a breach of any of the covenants contained in Section 1,
the
Company shall be entitled to injunctive or other equitable relief because the
non-violating party will be caused irreparable injury and damage as a result
of
the breach. This right to injunctive relief shall include the right to both
preliminary and permanent injunctions.
3. MISCELLANEOUS.
3.1 Governing
Law.
The
laws of the State of California shall govern the validity and construction
of
this Agreement and any dispute arising out of or relating to this Agreement,
without regard to the principles of conflict of laws.
3.2 Consent
to Jurisdiction.
The
parties submit to the jurisdiction of all state and federal courts sitting
in
the State of California, the venue of the Superior Court for Los Angeles County,
and the venue of the U.S. District Court for the Central District of California
and all actions and proceedings arising out of or relating to this Agreement
shall be heard and determined in a state or federal court in
California.
3.3 Severability.
A
ruling by any court that one or more of the provisions contained in this
Agreement is invalid, illegal or unenforceable in any respect shall not affect
any other provision of this Agreement so long as the economic or legal substance
of the transactions contemplated hereby is not affected in any manner materially
adverse to any party. Thereafter, this Agreement shall be construed as if the
invalid, illegal, or unenforceable provision had been amended to the extent
necessary to be enforceable within the jurisdiction of the court making the
ruling and to preserve the transactions originally contemplated by this
Agreement to the greatest extent possible.
3.4 Counterparts.
This
Agreement may be executed in two or more counterparts, each of which shall
be
deemed an original. In that event, in proving this Agreement it shall only
be
necessary to produce or account for the counterpart signed by the party against
whom the proof is being presented.
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3.5 Headings.
The
section and subsection headings have been included for convenience only, are
not
part of this Agreement and shall not be taken as an interpretation of any
provision of this Agreement.
3.6 Binding
Effect.
This
Agreement shall be binding upon and shall inure to the benefit of the parties
and their respective heirs, legatees, personal representatives and other legal
representatives, successors and permitted assigns. Except as otherwise
specifically provided, this Agreement is not intended and shall not be construed
to confer upon or to give any person other than the parties any rights or
remedies.
3.7 Amendments
and Modifications.
This
Agreement may be amended, waived, changed, modified or discharged only by an
agreement in writing signed by all of the parties.
3.8 Entire
Agreement.
This
Agreement constitutes the entire agreement among the parties with respect to
the
matters contained herein, and there are no representations, warranties,
covenants or obligations except as set forth in this Agreement. This Agreement
supersedes all prior and contemporaneous agreements, understandings,
negotiations and discussions, written or oral, of the parties, relating to
any
transaction contemplated by this Agreement.
3.9 Waiver.
Failure
to insist upon strict compliance with any of the terms, covenants or conditions
of this Agreement shall not be deemed a waiver of that term, covenant or
condition or of any other term, covenant or condition of this Agreement. Any
waiver or relinquishment of any right or power hereunder at any one or more
times shall not be deemed a waiver or relinquishment of that right or power
at
any other time.
3.10 Remedies
Cumulative.
The
remedies set forth in this Agreement are cumulative and are in addition to
any
other remedies allowed by law. Resort to one form of remedy shall not constitute
a waiver of alternate remedies.
3.11 WAIVER
OF RIGHT TO JURY TRIAL.
BY
EXECUTING THIS AGREEMENT, THE PARTIES KNOWINGLY AND WILLINGLY WAIVE ANY RIGHT
THEY HAVE UNDER APPLICABLE LAW TO A TRIAL BY JURY IN ANY DISPUTE ARISING OUT
OF
OR IN ANY WAY RELATED TO THIS AGREEMENT OR THE ISSUES RAISED BY THAT DISPUTE.
3.12 Background.
The
Background is a part of this Agreement.
3.13 Costs
of Litigation.
If the
Company files suit to enforce its rights under this Agreement, and the Company
prevails, the Company shall be entitled to recover from any other party against
whom the Company was successful all expenses incurred by it in preparing for
and
in trying the case, including, but not limited to, investigative costs, court
costs and reasonable attorneys' fees (including expenses incurred to collect
those expenses).
3.14 Word
Forms.
Wherever used in this Agreement, the singular shall include the plural, and
the
plural shall include the singular. The use of any gender, tense or conjugation
shall include all genders, tenses and conjugations.
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3.15 Notices.
Any
notice or other communication ("Notice") required or permitted under this
Agreement shall be in writing and either delivered personally or sent by
facsimile, overnight delivery, express mail, or certified or registered mail,
postage prepaid, return receipt requested. A Notice shall be addressed, in
the
case of the Company, to Xxxxx Xxxxxx at 0000
X.
Xxx 00, Xxxxx 000, Xxxxxxxx, XX 00000,
with a
copy to Xxxxxx X. Xxxxxxx, Xxxxxxx Xxxxxxx Xxxxxxx Xxxxxx, LLP, 0000 X.
Xxxxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxx Xxxxx, XX 00000; or in the case of
ATPA,
at ATPA’s address as it appears on the signature page below. If sent by
facsimile, a Notice shall be sent to the Company at (000)
000-0000,
with a
copy to Xxxxxx X. Xxxxxxx at (000) 000-0000, or to ATPA at the facsimile number
of ATPA that appears on the signature page below, if any. Any party may
designate, by Notice to the others, substitute addresses, addressees or
facsimile numbers for Notices, and thereafter, Notices are to be directed to
those substitute addresses, addressees or facsimile numbers.
[signature
page follows]
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WITNESS
the hands of the parties the date first above written.
| BENEFITS TECHNOLOGIES, LLC | ||
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| By: | /s/ Xxxxxxx Xxxxxxx | |
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Xxx Xxxxxxx, Chairman |
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| ASSOCIATED THIRD PARTY ADMINISTRATORS | ||
| |
|
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| By: | /s/ Xxxx Xxxxxxxxx | |
|
Xxxx Xxxxxxxxx
President
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Address:
|
0000 Xxxxx Xxxx Xxxx
Xxxxxxx, XX 00000
Fax: (000)
000-0000
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