Exhibit 10.3
Exhibit 2.4(a)(iv) (DF)
NONCOMPETITION AGREEMENT
This Non-competition Agreement (this "Agreement") is made as of February
28, 2007, by and among Sibling Theatricals, Inc., a wholly owned subsidiary of
Sibling Entertainment Group, Inc., a New York corporation ("Buyer"), Xxxx Xxxxxx
Productions, Inc., a Nevada corporation (the "Company"), and Xxxx Xxxxxx
residing at 0000 Xxxxxx Xxxxxx, Xxxxxxxxx, XX 00000 ("Selling Stockholder").
RECITALS
Pursuant to the terms and conditions of a stock purchase and shareholders'
agreement made as of February 28, 2007, among the Selling Stockholder, Xxxxx
Xxxxxx, and Xxxx Xxxxxx Productions, Inc. (the "Stock Purchase Agreement"), the
Buyer concurrently with the execution and delivery of this Agreement, is
purchasing from each of the Selling Stockholder and Xxxxx Xxxxxx, ten thousand
(10,000) shares each of the Company for an aggregate total of twenty thousand
(20,000) shares of the outstanding shares (the "Shares") of common stock, par
value $1.00 per share, of the Company. Section 2.4(a)(iv) of the Stock Purchase
Agreement requires, that this non-competition agreement be executed and
delivered by each of the Selling Stockholder as a condition to the purchase of
the Shares by Buyer.
AGREEMENT
The parties, intending to be legally bound, agree as follows:
1. DEFINITIONS
Capitalized terms not expressly defined in this Agreement shall have the
meanings ascribed to them in the Stock Purchase Agreement.
2. ACKNOWLEDGMENTS BY STOCKHOLDER
Selling Stockholder acknowledges that (a) Selling Stockholder has occupied
a position of trust and confidence with the Acquired Companies prior to the date
hereof and has become familiar with the following, any and all of which
constitute confidential information of the Acquired Companies, (collectively the
"Confidential Information"): (i) any and all trade secrets concerning the
business and affairs of the Acquired Companies, product specifications, data,
know-how, formulae, compositions, processes, designs, sketches, photographs,
graphs, drawings, samples, inventions and ideas, past, current and planned
research and development, current and planned manufacturing and distribution
methods and processes, customer lists, current and anticipated customer
requirements, price lists, market studies, business plans,
computer software and programs (including object code and source code), computer
software and database technologies, systems, structures and architectures (and
related processes, formulae, compositions, improvements, devices, know-how,
inventions, discoveries, concepts, ideas, designs, methods and information, of
the Acquired Companies and any other information, however documented, of the
Acquired Companies that is a trade secret; (ii) any and all information
concerning the business and affairs of the Acquired Companies (which includes
historical financial statements, financial projections and budgets, historical
and projected sales, capital spending budgets and plans, the names and
backgrounds of key personnel, personnel training and techniques and materials,
however documented; and (iii) any and all notes, analysis, compilations,
studies, summaries, and other material prepared by or for the Acquired Companies
containing or based, in whole or in part, on any information included in the
foregoing, (b) the business of the Acquired Companies is national in scope, (c)
its products and services are marketed throughout the United States; (d) the
Acquired Companies compete with other businesses that are or could be located in
any part of the United States; (e) Buyer has required that Selling Stockholder
make the covenants set forth in Sections 3 and 4 of this Agreement as a
condition to the Buyer's purchase of the Shares owned by Selling Stockholder;
(f) the provisions of Sections 3 and 4 of this Agreement are reasonable and
necessary to protect and preserve the Acquired Companies' business, and (g) the
Acquired Companies would be irreparably damaged if Selling Stockholder were to
breach the covenants set forth in Sections 3 and 4 of this Agreement.
3. CONFIDENTIAL INFORMATION
Selling Stockholder acknowledges and agrees that all Confidential
Information known or obtained by Selling Stockholder, whether before or after
the date hereof, is the property of the Acquired Companies. Therefore, Selling
Stockholder agrees that Selling Stockholder will not, at any time, disclose to
any unauthorized Persons or use for his own account or for the benefit of any
third party any Confidential Information, whether Selling Stockholder has such
information in Selling Stockholder's memory or embodied in writing or other
physical form, without Buyer's written consent, unless and to the extent that
the Confidential Information is or becomes generally known to and available for
use by the public other than as a result of Selling Stockholder's fault or the
fault of any other Person bound by a duty of confidentiality to Buyer or the
Acquired Companies. Selling Stockholder agrees to deliver to Buyer at the time
of execution of this Agreement, and at any other time Buyer may request, all
documents, memoranda, notes, plans, records, reports, and other documentation,
models, components, devices, or computer software, whether embodied in a disk or
in other form (and all copies of all of the foregoing), relating to the
businesses, operations, or affairs of the Acquired Companies and any other
Confidential Information that Selling Stockholder may then possess or have under
Selling Stockholder's control.
4. NONCOMPETITION
As an inducement for Buyer to enter into the Stock Purchase Agreement and
as
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additional consideration for the consideration to be paid to Selling Stockholder
under the Stock Purchase Agreement, Selling Stockholder agrees that:
(a) For such time as the Selling Stockholder (i) shall be employed by the
Company or any parent corporation or subsidiary thereof, (ii) owns, directly or
indirectly, five (5%) or more of the Company's issued and outstanding voting
securities, and, in any event, for no less than a period of four years and
ninety (90) days after the closing of the Stock Purchase Agreement (the
"Restriction Period"):
(i) Selling Stockholder will not, directly or indirectly,
engage or invest in, own, manage, operate, finance, control, or participate in
the ownership, management, operation, or control of, be employed by, associated
with, or in any manner connected with, lend Selling Stockholder's name or any
similar name to, lend Selling Stockholder's credit to, or render services or
advice to, any business whose products or activities compete in whole or in part
with the products or activities of the Company in the state of Nevada or in any
other jurisdiction in which the Company has provided services during the 24
month period immediately preceding this Agreement (the "Restricted Territory");
provided, however, that Selling Stockholder may purchase or otherwise acquire up
to (but not more than) one percent of any class of securities of any enterprise
(but without otherwise participating in the activities of such enterprise) if
such securities are listed on any national or regional securities exchange or
have been registered under Section 12(g) of the Securities Exchange Act of 1934.
Selling Stockholder agrees that this covenant is reasonable with respect to its
duration, geographical area, and scope.
(ii) Selling Stockholder will not, directly or indirectly,
either for himself or any other Person, (A) induce or attempt to induce any
employee of an Acquired Company to leave the employ of such Acquired Company,
(B) in any way interfere with the relationship between an Acquired Company and
any employee of such Acquired Company, (C) employ, or otherwise engage as an
employee, independent contractor, or otherwise, any employee of an Acquired
Company, or (D) induce or attempt to induce any customer, supplier, licensee, or
business relation of an Acquired Company to cease doing business with such
Acquired Company, or in any way interfere with the relationship between any
customer, supplier, licensee, or business relation of an Acquired Company.
(iii) Selling Stockholder will not, directly or indirectly,
either for himself or any other Person, solicit the business of any Person known
to Selling Stockholder to be a customer of an Acquired Company, whether or not
Selling Stockholder had personal contact with such Person, with respect to
products or activities which compete in whole or in part with the products or
activities of the Company;
(b) In the event of a breach by Selling Stockholder of any covenant set
forth in Subsection 4(a) of this Agreement, the term of such covenant will be
extended by the period of the duration of such breach;
(c) Selling Stockholder will not, at any time during or after the
Restrictive Period,
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disparage Buyer or the Acquired Companies, or any of their shareholders,
directors, officers, employees, or agents; and
(d) Selling Stockholder will, during the Restrictive Period, within ten
days after accepting any employment, advise Buyer of the identity of any
employer of Selling Stockholder. Buyer or an Acquired Company may serve notice
upon each such employer that Selling Stockholder is bound by this Agreement and
furnish each such employer with a copy of this Agreement or relevant portions
thereof.
5. NO ADDITIONAL PAYMENT REQUIRED
Selling Stockholder acknowledges and agrees that the payment of the
Purchase Price constitutes sufficient and adequate consideration and that no
additional or independent consideration is necessary for the execution, delivery
and performance of this Agreement.
6. REMEDIES
If Selling Stockholder breaches the covenants set forth in Sections 3 or 4
of this Agreement, Buyer and the Acquired Companies will be entitled to the
following remedies:
(a) Damages from Selling Stockholder;
(b) To offset against any and all amounts owing to Selling Stockholder
under the Stock Purchase Agreement any and all amounts which Buyer or the
Acquired Companies claim under Subsection 6(a) of this Agreement; and
(c) In addition to its right to damages and any other rights it may have,
to obtain injunctive or other equitable relief to restrain any breach or
threatened breach or otherwise to specifically enforce the provisions of
Sections 3 and 4 of this Agreement, it being agreed that money damages alone
would be inadequate to compensate the Buyer and the Acquired Companies and would
be an inadequate remedy for such breach.
(d) The rights and remedies of the parties to this Agreement are
cumulative and not alternative.
7. SUCCESSORS AND ASSIGNS
This Agreement will be binding upon Buyer, the Acquired Companies and
Selling Stockholder and will inure to the benefit of Buyer and the Acquired
Companies and their affiliates, successors and assigns and Selling Stockholder
and Selling Stockholder's assigns, heirs and legal representatives.
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8. WAIVER
The rights and remedies of the parties to this Agreement are cumulative
and not alternative. Neither the failure nor any delay by any party in
exercising any right, power, or privilege under this Agreement will operate as a
waiver of such right, power, or privilege, and no single or partial exercise of
any such right, power, or privilege will preclude any other or further exercise
of such right, power, or privilege or the exercise of any other right, power, or
privilege. To the maximum extent permitted by applicable law, (a) no claim or
right arising out of this Agreement can be discharged by one party, in whole or
in part, by a waiver or renunciation of the claim or right unless in writing
signed by the other party; (b) no waiver that may be given by a party will be
applicable except in the specific instance for which it is given; and (c) no
notice to or demand on one party will be deemed to be a waiver of any obligation
of such party or of the right of the party giving such notice or demand to take
further action without notice or demand as provided in this Agreement.
9. GOVERNING LAW
This Agreement will be governed by the laws of the State of Nevada without
regard to conflicts of laws principles.
10. JURISDICTION; SERVICE OF PROCESS
Any action or proceeding seeking to enforce any provision of, or based on
any right arising out of, this Agreement may be brought against any of the
parties in the courts of the State of New York, County of New York, or, if it
has or can acquire jurisdiction, in the United States District Court for the
Southern District of New York, and each of the parties consents to the
jurisdiction of such courts (and of the appropriate appellate courts) in any
such action or proceeding and waives any objection to venue laid therein.
Process in any action or proceeding referred to in the preceding sentence may be
served on any party anywhere in the world.
11. SEVERABILITY
Whenever possible each provision and term of this Agreement will be
interpreted in a manner to be effective and valid but if any provision or term
of this Agreement is held to be prohibited by or invalid, then such provision or
term will be ineffective only to the extent of such prohibition or invalidity,
without invalidating or affecting in any manner whatsoever the remainder of such
provision or term or the remaining provisions or terms of this Agreement. If any
of the covenants set forth in Section 4 of this Agreement are held to be
unreasonable, arbitrary, or against public policy, such covenants will be
considered divisible with respect to
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scope, time, and geographic area, and in such lesser scope, time and geographic
area, will be effective, binding and enforceable against Selling Stockholder.
12. COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of which
will be deemed to be an original copy of this Agreement and all of which, when
taken together, will be deemed to constitute one and the same agreement.
13. SECTION HEADINGS, CONSTRUCTION
The headings of Sections in this Agreement are provided for convenience
only and will not affect its construction or interpretation. All references to
"Section" or "Sections" refer to the corresponding Section or Sections of this
Agreement unless otherwise specified. All words used in this Agreement will be
construed to be of such gender or number as the circumstances require. Unless
otherwise expressly provided, the word "including" does not limit the preceding
words or terms.
14. NOTICES
All notices, consents, waivers, and other communications under this
Agreement must be in writing and will be deemed to have been duly given when (a)
delivered by hand (with written confirmation of receipt), (b) sent by facsimile
(with written confirmation of receipt), provided that a copy is mailed by
registered mail, return receipt requested, or (c) when received by the
addressee, if sent by a nationally recognized overnight delivery service
(receipt requested), in each case to the appropriate addresses and facsimile
numbers set forth below (or to such other addresses and facsimile numbers as a
party may designate by notice to the other parties):
If to the Selling Stockholder, to: Xxxx Xxxxxx
c/o Xxxx Xxxxxx Productions, Inc.
0000 Xxxxxxxxx Xxx
Xxx Xxxxx, XX 00000
Fax No. :(000) 000-0000
Email: xxxxxxx@xxxxxxx.xxx
With a copy to: Xxxx Doechung Xxx, Esq.
0000 Xxxxxx Xxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxx 00000
Fax No.: (000) 000-0000
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E-mail: xxxx@xxxxxxxxxxx.xxx
If to the Buyer: Sibling Theatricals, Inc.,
000 Xxxx 00xx Xxxxxx, 000
Xxx Xxxx, XX 00000
Attention: Xxxxx (Xxx) Xxxxxxxx, COO
Fax No.: 000-000-0000
E-mail: Xxx@XxxxxxxXxxxxxxxxxxxx.xxx
With a copy to: Xxxxxx & Xxxxxx, LLP
000 Xxxxx 0 Xxxxx, Xxxxx 000
Xxxxxxxxx, Xxx Xxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx, Esq.
Fax No.: (000) 000-0000
E-mail: xxxxxxx@xxxxxxxxx.xxx
15. ENTIRE AGREEMENT
This Agreement, the Consulting Agreement, the Stock Purchase Agreement and
the documents executed and delivered pursuant thereto constitute the entire
agreement between the parties with respect to the subject matter of this
Agreement and supersede all prior written and oral agreements and understandings
between Buyer and Selling Stockholder with respect to the subject matter of this
Agreement. This Agreement may not be amended except by a written agreement
executed by the party to be charged with the amendment.
----- SIGNATURE PAGE FOLLOWS -----
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IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of
the date first above written.
BUYER:
SIBLING THEATRICALS, INC.
By: /s/ Xxxxxxxx Xxxxxxx
----------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: President
SELLING STOCKHOLDER:
/s/ Xxxx Xxxxxx
-------------------------------------
Xxxx Xxxxxx, Individually
COMPANY:
XXXX XXXXXX PRODUCTIONS, INC.
By: /s/ Xxxx Xxxxxx
----------------------------------
Name: Xxxx Xxxxxx
Title: President
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