Exhibit 10.51
NON-COMPETITION AGREEMENT
NON-COMPETITION AGREEMENT, dated as of __________, 1999 (this
"Agreement"), by and between 7TH LEVEL, INC., a Delaware corporation (the
"Company"), and XXXXXX X.
XXXXXXX ("Employee").
RECITALS
WHEREAS, the Company is simultaneously entering into an Agreement and
Plan of Merger (the "Merger Agreement"), by and among the Company, 7th Level
Merger Corporation ("Merger Corporation") and ViaGrafix Corporation, an Oklahoma
corporation ("ViaGrafix"), pursuant to which Merger Corporation shall merge with
and into ViaGrafix (the "Merger");
WHEREAS, Employee is the current Executive Vice President of ViaGrafix
and a principal stockholder of ViaGrafix; and
WHEREAS, the Company desires to employ Employee pursuant to a separate
employment agreement;
WHEREAS, due to his stock ownership and operation of ViaGrafix, the
Employee could take actions to effectively impair the successful operation by
the Company of ViaGrafix after the Merger, and therefore it is a condition
precedent to the Merger that Employee enter into this Agreement in order to
induce the Company to complete the Merger.
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, and for other good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the parties agree as follows:
1. NON-COMPETITION AND NON-SOLICITATION.
1.1 PROHIBITION ON COMPETITION. During the greater of (x)
three years from the effective time of the Merger and (y) the period of his
employment with the Company (other than on behalf of the Company) and for twenty
four (24) months after the date of termination of his employment with the
Company (the "Non-Competition Period"), Employee agrees that, without the prior
written consent of the Company: he will not, either as principal, manager,
agent, consultant, officer, stockholder, partner, investor, lender or employee,
or in any other capacity (and whether or not for compensation) carry on, be
engaged in or employed by or be a consultant to or have any financial interest
in, any business which is "in competition with the business of the Company" (as
defined in Section 1.4 below); provided, however, that Employee shall not be
restricted in activities for Websoft, Inc., as long as Websoft, Inc. (except
Wingmaster) does not compete with the
Company's training products and services or with graphics software products
currently sold or under development by the Company. Nothing in this Section 1
shall be construed so as to preclude Employee from (i) investing in any publicly
held company provided Employee's beneficial ownership of any class of such
company's securities does not exceed 5% of the outstanding securities of such
class, (ii) owning memberships, or other similar rights or interests therein, of
any United States or foreign securities, commodities, options or similar
exchange, board of trade, contract market or terminal association (collectively
"Exchanges") and exercising the rights and privileges attendant to such
ownership for his own personal account or for the account of any spouse, child,
parent or sibling or any trust created for the benefit of Employee or any of the
foregoing or for the account of any entity wholly owned by Employee or any of
the foregoing relatives or trusts or (iii) trading or dealing on any Exchanges
for Employee's own personal account or for the account of any relative or any
trust created for the benefit of any relative of Employee.
1.2 NON-SOLICITATION OF EMPLOYEES. During the Non-Competition
Period, Employee will not: solicit or request any employee of the Company or its
subsidiaries to leave the employ of the Company or its subsidiaries or join the
employ of any individual or entity that is in competition with the business of
the Company.
1.3 NON-SOLICITATION OF CUSTOMERS. During the Non-Competition
Period, Employee will not solicit, or sell services or attempt to sell services
that are in competition with the business of the Company to any "Customer",
except on behalf of Websoft, Inc. For purposes hereof, "Customer" shall mean all
customers of the Company which are known to Employee during the two (2) year
period immediately prior to the termination of Employee's employment.
1.4 A person or entity which is "in competition with the
business of the Company" means any entity engaged in the business of developing
and marketing training products, graphic software products, learning products
and web-based training products as presently conducted or as conducted during
the Employee's employment by the Company, or its subsidiaries.
1.5 Employee and the Company agree that the covenants of
non-competition and non-solicitation are reasonable covenants under the
circumstances, and further agree that if in the opinion of any court of
competent jurisdiction such covenants are not reasonable in any respect, such
court shall have the right, power and authority to excise or modify such
provision or provisions of these covenants as to the court shall appear not
reasonable and to enforce the remainder of these covenants as so amended.
Employee agrees that any breach of the covenants contained herein would
irreparably injure the Company. Accordingly, Employee hereby agrees that, in
such event, the Company shall be entitled to obtain a temporary and/or permanent
injunction to restrain any such breach or threatened breach or to obtain
specific performance of any such provisions, all without prejudice to any and
all other remedies which the Company may have at law or in equity.
2. NOTICES. Any notice, request, demand or other communication required
or permitted hereunder shall be in writing and shall be deemed to have been duly
given when delivered by hand, electronic transmission (with a copy following by
hand or by overnight courier), by registered or
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certified mail, postage prepaid, return receipt requested or by overnight
courier addressed to the other party. All notices shall be addressed as follows,
or to such other address or addresses as may be substituted by notice in
writing:
To the Company:
7th Level, Inc.
000 Xxxxxxxxxxx Xxxxxx
Xxxxx Xxxxxx, Xxx Xxxx 00000
Attention: Chief Executive Officer
Fax No.: (000) 000-0000
with a copy to:
Xxxxxxx Berlin Shereff Xxxxxxxx, LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxx, Esq.
Fax No.: (000) 000-0000
To Employee:
Xxxxxx X. Xxxxxxx
c/o ViaGrafix Corporation
Xxx Xxxxxxxx Xxx
Xxxxx, Xxxxxxxx 00000
with a copy to:
Johnson, Allen, Xxxxx & Xxxxxxxxxx, Inc.
000 Xxxxxxxxx Xxxx Xxxxxxxx
601 S. Boulder
Tulsa, Oklahoma
Attention: Xxxx X. Xxxxxxx, Xx., Esq.
Fax No.: (000) 000-0000
Communications delivered by hand or by overnight courier shall be deemed
received on the date of delivery; communications sent by electronic means shall
be deemed received one (1) business day after the sending thereof, and
communications sent by registered or certified mail shall be deemed received
three (3) business days after the sending thereof.
3. SEPARABILITY; LEGAL FEES. If any provision of this Agreement shall
be declared to be invalid or unenforceable, in whole or in part, such invalidity
or unenforceability shall not affect the
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remaining provisions hereof which shall remain in full force and effect. Each
party shall bear the costs of any legal fees and other fees and expenses which
may be incurred in respect of enforcing its respective rights under this
Agreement.
4. ASSIGNMENT. The Company may assign this Agreement to any successor
(whether by operation of law or otherwise) to all or substantially all of the
assets or business of the Company, if such successor expressly agrees in writing
to assume the obligations of the Company hereunder.
5. AMENDMENT; WAIVER. This Agreement may only be amended by written
agreement signed by the parties hereto. A waiver by the Company or Employee of a
breach of any provision of this Agreement by the other party shall not operate
or be construed as a waiver of any subsequent breach by the other party.
6. GOVERNING LAW. This Agreement shall be construed, interpreted and
governed in accordance with the laws of the State of Oklahoma, without reference
to rules relating to conflicts of law.
7. ENTIRE AGREEMENT. This Agreement contains the entire understanding
between Employee and the Company and supersede in all respects any prior or
other agreement or understanding between the Company and Employee as to the
matters set forth herein.
8. HEADINGS. The section headings contained in this Agreement are for
the convenience of reference only and shall not affect the construction of any
provision of this Agreement.
9. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which will be deemed an original but all of which together
this shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Non-Competition
Agreement to be signed on the date and year first above written.
7TH LEVEL, INC.
By:
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Name:
Title:
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Xxxxxx X. Xxxxxxx
