EXHIBIT 10.62
NONCOMPETITION AGREEMENT
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This Noncompetition Agreement ("Agreement"), effective as of February
23, 1998 ("Effective Date"), is entered into between Xxxxxxxx Xxxxxx ("Gobuty")
and Xxxxxxxx Xxxxxx International U.S.A., Inc., a California corporation
("MGI"), on the one hand, and Tarrant Apparel Group, a California corporation
(the "Company"), on the other hand, with reference to the following facts:
A. MGI and the Company are parties to that certain Asset Purchase
Agreement dated as of February 18, 1998 (the "Purchase Agreement").
B. The execution and delivery of this Agreement is a condition to the
closing of the transactions contemplated by the Purchase Agreement (the
"Transaction").
NOW, THEREFORE, IN CONSIDERATION OF the mutual agreements hereinafter
set forth, MGI, Gobuty and the Company agree as follows:
1. NON-COMPETITION. During the Term of this Agreement, MGI and
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Gobuty shall not, directly or indirectly, without the prior written consent of
the Company, provide consulting services or otherwise provide services to
(whether as an employee or a consultant, with or without pay), own, manage,
operate, join, control, participate in, or be connected with (as a stockholder,
partner or otherwise), any business, individual, partner, firm, corporation, or
other entity that is a competitor of MGI's business (the "Business") acquired by
the Company pursuant to the Purchase Agreement (a "Competitor"); provided, that
the "beneficial ownership" by MGI, either individually or as a member of a
"group," as such terms are used in Rule 13d of the General Rules and Regulations
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), of
not more than one percent (1%) of the voting stock of any publicly held
corporation shall not alone constitute a violation of this Agreement and neither
Gobuty nor MGI shall be prohibited hereunder from participating in the Permitted
Businesses (as defined below), provided that from and after four (4) months
after the date hereof, neither MGI nor Gobuty shall be active in the Permitted
Businesses. For purposes of this Agreement, "Permitted Businesses" shall mean
winding down the affairs of MGI and conducting the businesses related to the
"NFL" licenses.
2. NON-SOLICITATION OF CUSTOMERS AND SUPPLIERS. During the Term of
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this Agreement, MGI and Gobuty shall not, directly or indirectly, influence or
attempt to influence customers or suppliers of the Company or any of its
subsidiaries or affiliates, to divert their business to any Competitor. The
foregoing shall in no event preclude Gobuty or MGI from participating in the
Permitted Businesses in accordance with Section 1 above.
3. NON-SOLICITATION OF EMPLOYEES. MGI and Gobuty agree that, during
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the Term of this Agreement, they will not, directly or indirectly, solicit or
recruit any employee of the Company for the purpose of being employed by any of
them or by any Competitor.
4. INJUNCTIVE RELIEF. It is expressly agreed that the Company will
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or would suffer irreparable injury if MGI and Gobuty were to compete with the
Company or any subsidiary or affiliate of the Company in violation of this
Agreement and that the Company would by reason of such competition be entitled
to injunctive relief in a court of appropriate jurisdiction. MGI, Gobuty and
the Company acknowledge and agree that the Business is global in nature, and
that the terms of the non-competition agreement set forth herein shall apply on
a worldwide basis, and shall specifically apply to each city and county in the
State of California and each other state in the United States.
5. TERM. This Agreement shall terminate two years after the
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termination of Gobuty's employment by the Company (the "Term").
6. SEVERABILTY. It is the desire and intent of the parties hereto
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that the provisions of this Agreement shall be enforced to the fullest extent
permissible under the laws and public policies applied in each jurisdiction in
which enforcement is sought. If any particular provision or a portion of this
Agreement shall be adjudicated to be invalid or unenforceable, this Agreement
shall be deemed amended to delete therefrom such provision or portion
adjudicated to be invalid or unenforceable, such amendment to apply only with
respect to the operation of this Agreement in the particular jurisdiction in
which such adjudication is made.
7. NOTICES. All notices and other communications under this
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Agreement shall be in writing and shall be given by fax or first class mail,
certified or registered with return receipt requested, and shall be deemed to
have been duly given three days after mailing or 24 hours after transmission of
a fax (at the individual's then current fax number) to the respective persons
named below:
If to Company: Tarrant Apparel Group
0000 Xxxx Xxxxxxxxxx Xxxxxxxxx
Xxx Xxxxxxx, XX 00000
Attn: Chief Executive Officer
Telecopier: (000) 000-0000
If to Gobuty: Xx. Xxxxxxxx Xxxxxx
c/o Xxxxxxxx Xxxxxx International U.S.A., Inc.
0000 Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxx Xxxx, XX 00000
Fax: (000) 000-0000
If to MGI: Xxxxxxxx Xxxxxx International U.S.A., Inc.
0000 Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxx Xxxx, XX 00000
Attn: President
Fax: (000) 000-0000
with a copy to: Sheppard, Mullin, Xxxxxxx & Hampton LLP
000 Xxxxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxxxx X. Xxxxx, Esq.
Fax: (000) 000-0000
Either party may change such party's address for notices by notice duly given
pursuant hereto.
8. ATTORNEYS' FEES. If any legal action is necessary to enforce the
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terms and conditions of this Agreement, the prevailing party shall be entitled
to recover all costs of suit and reasonable attorneys' fees.
9. ENTIRE AGREEMENT. This Agreement constitutes the parties' entire
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agreement with respect to the subject matter hereof and supersedes all prior
statements or agreements, both written and oral.
10. ASSIGNMENT; SUCCESSORS. This Agreement is personal in its nature
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and none of the parties hereto shall, without the consent of the other, assign
or transfer this Agreement or any rights or obligations hereunder; provided
that, in the event of the merger, consolidation, transfer or sale of all or
substantially all of the assets of the Company with or to any other individual
or entity, this Agreement shall, subject to the provisions hereof, be binding
upon and inure to the benefit of such successor.
11. HEADINGS. Section headings in this Agreement are included herein
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for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose.
12. WAIVER; MODIFICATION. Failure to insist upon strict compliance
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with any of the terms, covenants or conditions hereof shall not be deemed a
waiver of such term, covenant or condition, nor shall any waiver or
relinquishment of, or failure to insist upon strict compliance with, any right
or power hereunder at any one or more times be deemed a waiver or relinquishment
of such right or power at any other time or times. This Agreement shall not be
amended or modified in any respect except by a writing executed by each party
hereto.
13. GOVERNING LAW; SUBMISSION TO JURISDICTION. This Agreement shall
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be governed by and construed in accordance with the substantive and procedural
laws of the State of California applicable to agreements made and to be
performed entirely within such State. Each of the parties submits to the
jurisdiction of any state or federal court sitting in Los Angeles, California,
in any action or proceeding arising out of or related to this Agreement in any
other court. Each of the parties waives the defense of inconvenient forum to the
maintenance of any action or proceeding so brought and waives any bond, surety,
or other security that might be required of any other party with respect
thereto. Any party may make service on any other party by sending or delivering
a copy of the process to the party to be served at the address and in the manner
provided for the giving of notices in Section 7 above. Each party agrees that a
final judgment in any action or proceeding so brought shall be conclusive and
may be enforced by suit on the judgment or in any other manner provided by law
or at equity.
14. COUNTERPARTS. This Agreement may be executed in several
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counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
Company:
TARRANT APPAREL GROUP
By /s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx, Vice President
Gobuty:
/s/ Xxxxxxxx Xxxxxx
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XXXXXXXX XXXXXX
MGI:
XXXXXXXX XXXXXX INTERNATIONAL U.S.A.,
INC.
By /s/ Xxxxxxxx Xxxxxx
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[Printed Name and Title]
