EXHIBIT 2.7.6.1
EXHIBIT E
FORM OF
NON-COMPETITION AGREEMENT
THIS NON-COMPETITION AGREEMENT (this "Agreement") is made and entered
into as of this 5th day of November, 1999 by and between Specialty Electronic
Systems, Inc., a Delaware corporation ("SES"), and C. Xxxxxxx Xxxxxx ("Seller").
RECITALS:
WHEREAS, as of the date hereof, SES Acquisition Corp. ("SES
Acquisition"), a wholly-owned subsidiary of Able Telcom Holding Corp. ("Able"),
is merging, pursuant to an Agreement and Plan of Merger, dated November 5, 1999,
with and into SASCO;
WHEREAS, Seller holds 51%of the issued and outstanding stock of SES;
WHEREAS, as a result of the above-described merger, Seller will sell
all of his interest in SES and will receive shares of Able common stock as
determined by the SES Merger Agreement;
WHEREAS, in order to protect fully SES's and its affiliates'
confidential information and the goodwill of the business of SES which Able has
acquired by virtue of the stock purchase described above and to ensure that Able
enjoys the benefits of such goodwill and business, SES and Seller desire to
provide for Seller's agreement of confidentiality and agreement not to compete
with SES and its affiliates as specified herein; and
WHEREAS, SES and Seller desire to set forth herein the terms of
Seller's agreement of confidentiality and agreement not to compete.
NOW, THEREFORE, in consideration of the mutual promises, agreements and
mutual covenants set forth herein and for other good and valuable consideration
the parties hereto hereby agree as follows:
1. CONFIDENTIALITY. Seller acknowledges and agrees that the Trade Secrets
(as defined below) and the Confidential Information (as defined below) of SES
and its affiliates (including any parent, subsidiaries or commonly controlled
entities) and all physical embodiments thereof (collectively referred to as the
"Proprietary Information") are valuable, special and unique assets of the
business of SES and its affiliates and have been developed by SES and its
affiliates and will continue to be developed by SES and its affiliates following
Able's purchase of SES at considerable time and expense. Seller further
acknowledges that access to such Proprietary
Information is essential to performance of Seller's duties and responsibilities
under this Agreement. Therefore, in order to obtain access to such Proprietary
Information, Seller agrees that except with respect to those duties assigned to
him by SES and for the time periods set forth below, Seller shall hold in
strictest confidence all Proprietary Information, regardless of whether such
Proprietary Information was received prior to, on or subsequent to the date of
this Agreement, and will not reproduce, use, distribute, disclose, publish or
otherwise disseminate any Proprietary Information, in whole or in part, and will
take no action causing, or fail to take any action necessary to prevent causing,
any Proprietary Information to lose its character as Proprietary Information,
nor wilfully make use of such information for Seller's own purposes or for the
benefits of any person, firm, corporation, association or other entity (except
SES and its affiliates) under any circumstances, except that Seller may disclose
such Proprietary Information pursuant to a court order, subpoena or other legal
process, provided that, at least ten days in advance of any legal disclosure,
Seller shall furnish SES with a copy of the judicial or administrative order
requiring that such information be disclosed together with a written description
of the information to be disclosed (which description shall be in sufficient
detail to allow SES and its affiliates to determine the nature and scope of the
information proposed to be disclosed), and Seller covenants and agrees to
cooperate with SES and its affiliates to deliver the minimum amount of
information necessary to comply with such order.
For purposes of this Agreement, the term "Trade Secrets" means
information, including but not limited to, any technical or nontechnical data,
formula, pattern, compilation, program, device, method, technique, drawing,
process, financial data, financial plan, product plan, list of actual or
potential customers or suppliers, or other information similar to any of the
foregoing, which derives economic value, actual or potential, from not being
generally known to, and not being readily ascertainable by proper means by,
other persons who can derive economic value from its disclosure or use. For
purposes of this Agreement, the term "Trade Secrets" does not include
information that Seller can show by competent proof (i) was known to Seller and
reduced to writing prior to disclosure by SES or its affiliates to Seller (but
only if Seller promptly notifies SES of Seller's prior knowledge); (ii) was
generally known to the public at the time SES or its affiliates disclosed the
information to Seller; (iii) became generally known to the public after
disclosure to Seller through no act or omission of Seller; or (iv) was disclosed
to Seller by a third party having a bona fide right both to possess the
information and to disclose the information to Seller.
The term "Confidential Information" means any data or information of
SES (including information of SES or SES's affiliates), other than Trade
Secrets, regarding the business of SES and its affiliates or their policies and
operations which is valuable to SES and not generally known to competitors of
SES and its affiliates. For purposes of this Agreement, the term "Confidential
Information" does not include information that Seller can show by competent
proof (i) was known to Seller and reduced to writing prior to disclosure by SES
or its affiliates to Seller (but only if Seller promptly notifies SES of
Seller's prior knowledge); (ii) was generally known to the public at the time
SES or its affiliates disclosed the information to
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Seller; (iii) became generally known to the public after disclosure to Seller
through no act or omission of Seller; or (iv) was disclosed to Seller by a third
party having a bona fide right both to possess the information and to disclose
the information to Seller.
The provisions of this Section 1 will apply to Trade Secrets for so
long as such information remains a Trade Secret and to Confidential Information
for a period of five years from the date hereof.
2. COVENANT NOT TO COMPETE.
a. AGREEMENT NOT TO COMPETE. SES designs, fabricates, installs and
integrates ITS systems (the "Business"). In order to fully protect SES's and its
affiliates' Confidential Information and Trade Secrets and the goodwill of the
Business of SES purchased by Able on the date hereof, and to ensure that SES
enjoys the benefits of that Business, for a period of five years from the date
hereof (the "Non-Competition Period"), Seller shall not, except as authorized in
writing by SES, directly or indirectly, be employed by, render services to,
assist, participate in the affairs of, invest in, or otherwise be connected
with, any person or enterprise which person or enterprise is engaged in, or is
planning to engage in, and shall not personally engage in, any business that is
in any respect competitive with the Business of SES or any of its affiliates,
with respect to any products or services of the Business of SES and its
affiliates, within any state in which SES is conducting Business or reasonably
expects to conduct business at the time of this Agreement (the "Territory");
provided that Seller may hold investments representing a less than 5% interest
in any publicly held entity competing with SES. SES recognizes Seller's
ownership of SES, LLC, which owns 36% of L&K Electric Supply, and hereby
acknowledges and agrees that such ownership shall not violate the terms of this
Section 2(a). In furtherance of such covenant not to compete, Seller hereby
acknowledges that SES currently does business, and following the merger
described herein, SES shall continue to do business in a growing number of
locales throughout the United States and that in his capacity as an employee of
SES his responsibilities have involved and will continue to involve the conduct
of business throughout such Territory.
b. NON-SOLICITATION COVENANT. Seller agrees that for the
Non-Competition Period, he will not, nor will he assist any of his affiliates
to, directly or indirectly, recruit or otherwise solicit or induce any agent,
non-employee sales representative, customer, subscriber or supplier of SES or
any affiliate of SES to terminate its contract, relationship or other
arrangement with SES or any affiliate of SES, otherwise change its relationship
with SES or any affiliates of SES, or establish any relationship with Seller or
any of his affiliates for any business purpose deemed materially competitive
with the Business.
c. NON-INTERFERENCE WITH EMPLOYEES. Seller agrees that for the
Non-Competition Period, he will not, nor will he assist any of his affiliates
to, directly or indirectly, recruit or otherwise solicit or induce any employee
of SES or any affiliate of SES to terminate or otherwise negatively affect its
employment relationship with SES or any affiliate of SES, or
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establish an employment relationship directly or indirectly with Seller or any
entity other than SES or its affiliates with whom Seller is affiliated, absent
the express written consent of SES's Board of Directors.
d. REMEDIES. The parties recognize, acknowledge and agree that (i) any
breach or threatened breach of the provisions of this Section 2 shall cause
irreparable harm and injury to SES and that money damages alone will not provide
an adequate remedy for such breach or threatened breach, (ii) the duration,
scope and geographical application of this Section 2 are fair and reasonable
under the circumstances of the business of SES, and are reasonably required to
protect the legitimate business interests of SES and the goodwill of the
business purchased by Able, (iii) the restrictions contained in this Section 2
will not prevent Seller from earning or seeking a livelihood, and (iv) the
restrictions contained in this Section 2 shall apply in all areas where such
application is permitted by law. Accordingly, Seller agrees that SES shall be
entitled to have the provisions of this Section 2 specifically enforced by any
court having jurisdiction, and that such a court may issue a temporary
restraining order, preliminary injunction or other appropriate equitable relief,
without having to prove the inadequacy of available remedies at law, having to
post any bond or any other undertaking. In addition, SES shall be entitled to
avail itself of all such other actions and remedies available to it or any of
its affiliates under law or in equity and shall be entitled to such damages as
it sustains by reason of such breach or threatened breach. It is the express
desire and intent of the parties that the provisions of this Section 2 be
enforced to the full extent possible.
e. SEVERABILITY. In light of the fact that the covenants set forth in
Section 2 are reasonably required to protect the legitimate interests of SES, if
any provision of this Section 2 hereof is held to be unenforceable because of
the duration of such provision, the area covered thereby or the scope of the
activity restrained, the parties hereby expressly agree that the court making
such determination shall have the power to reduce the duration and/or areas of
such provision and/or the scope of the activity to be restrained contained in
such provision to that which is reasonable for protection of the business
interests of SES and its affiliates and, in its reduced form, such provision
shall then be enforceable. The parties hereto intend and agree that the
covenants contained in Section 2(a) shall be construed as a series of separate
covenants, one for each municipality, community, county or state included within
the area designated by Section 2(a). Except for geographic coverage, the terms
and conditions of each such separate covenant shall be deemed identical to the
covenant contained in Section 2(a). Furthermore, if any court shall refuse to
enforce any of the separate covenants deemed included in Section 2(a), then such
unenforceable covenant shall be deemed eliminated from the provisions hereof to
the extent necessary to permit the remaining separate covenants to be enforced
in accordance with their terms. The prevailing party in any action arising out
of a dispute in respect of any provision of this Section 2 shall be entitled to
recover from the non-prevailing party reasonable attorneys' fees and costs and
disbursements incurred in connection with the prosecution or defense, as the
case may be, of any such action.
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3. SEPARATE AGREEMENTS. The covenants of Seller contained in Sections 1
and 2 of this Agreement shall be construed as separate agreements independent of
any other agreement, claim, or cause of action of Seller against SES, whether
predicated on this Agreement or otherwise. In particular, the covenants of
Seller contained in Sections 1 and 2 of this Agreement shall be independent of
the corresponding covenants of Seller set forth in that certain Employment
Agreement dated of even date herewith by and between SES and Seller (the
"Employment Agreement"). In no event shall the termination of Seller's
responsibilities under this Agreement result in the termination of Seller's
responsibilities under the Employment Agreement. The covenants contained in this
Agreement are necessary to protect the legitimate business interests of SES.
4. TERMINATION. The covenants set forth in Sections 1 and 2 hereof shall
continue for the period set forth therein. Notwithstanding the above, in the
event Seller's employment with SES is terminated without cause, the covenants
set forth in Section 2 hereof shall terminate on the effective date of Seller's
termination.
5. MISCELLANEOUS. This Agreement will be governed by and construed in
accordance with the law of the State of Florida, without giving effect to the
principles of conflicts of laws of such state.
a. GOVERNING LAW. This Agreement will be governed by and construed in
accordance with the laws of the State of Florida, without giving effect to the
principles of conflicts of laws of such state.
b. COUNTERPARTS. This Agreement may be executed in several counterparts
each of which is an original. This Agreement and any counterpart so executed
shall be deemed to be one and the same instrument. It shall not be necessary in
making proof of this Agreement or any counterpart hereof to produce or account
for any of the other counterparts.
c. CONTENTS OF AGREEMENT; PARTIES IN INTEREST, ETC. This Agreement sets
forth the entire understanding of the parties. Any previous agreements or
understandings between the parties regarding the subject matter hereof are
merged into and superseded by this Agreement. All representations, warranties,
covenants, terms, conditions and provisions of this Agreement shall be binding
upon and inure to the benefit of and be enforceable by the respective heirs,
legal representatives, successors and permitted assigns of SES and Seller.
Neither this Agreement nor any rights, interests or obligations hereunder may be
assigned by any party without the prior written consent of the other party
hereto.
d. SECTION HEADINGS. The section headings herein have been inserted for
convenience of reference only and shall in no way modify or restrict any of the
terms or provisions hereof.
e. NOTICES. All notices, requests, demands and other communications
which are required or permitted hereunder shall be sufficient if given in
writing and delivered personally or by registered or certified mail, postage
prepaid, by a nationally recognized overnight courier service, or by facsimile
transmission (with a copy simultaneously sent by registered or certified mail,
postage prepaid), as follows (or to such other address as shall be set forth in
a notice given in the same manner):
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1. If to SES, to:
Specialty Electronic Systems, Inc.
c/o Able Telcom Holding Corp.
0000 Xxxxxxx Xxxxx Xxxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attn: President
Copies to:
Xxxx Xxxxxxxx Xxxxxxxx & Xxxxxx LLP
000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Attn: Xxxxxxxxx X. Xxx, Esq.
2. If to Seller, to:
C. Xxxxxxx Xxxxxx
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
Telephone:
Facsimile:
f. MODIFICATION AND WAIVER. Any of the terms or conditions of this
Agreement may be waived in writing at any time by the party which is entitled to
the benefits thereof, and this Agreement may be modified or amended at any time
by SES and Seller. No supplement, modification or amendment of this Agreement
shall be binding unless executed in writing by each of the parties hereto. No
waiver of any of the provisions of this Agreement shall be deemed or shall
constitute a waiver of any other provision hereof nor shall such waiver
constitute a continuing waiver.
g. THIRD PARTY BENEFICIARIES. Except as otherwise expressly set forth
herein, no individual or entity shall be a third-party beneficiary of the
representations, warranties, covenants and agreements made by any party hereto.
h. MEDIATION. SES and Seller shall attempt in good faith to mediate any
claim or controversy arising out of or relating to this Agreement or any breach
thereof if either of
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them requests mediation and gives written notice to the other (the "Mediation
Notice"). Any notice given pursuant to the preceding sentence shall include a
brief statement of the claim or controversy. If SES and Seller do not resolve
the claim or controversy within 20 days after the date of the Mediation Notice,
SES and Seller shall then use reasonable efforts to agree upon an independent
mediator. If SES and Seller do not agree upon an independent mediator within ten
days after the date of the Mediation Notice, either party may request that
JAMS/Endispute ("JAMS"), or a similar mediation service of a similar national
scope if JAMS no longer then exists, appoint an independent mediator. SES and
Seller shall share the costs of mediation equally and shall pay such costs in
advance upon the request of the mediator or any party. Within ten days after
selection of the mediator, the mediator shall set the mediation. If SES and
Seller do not resolve the dispute within 30 days after the date of the Mediation
Notice, the dispute shall be decided by arbitration as set forth in Section
14(h) hereof.
i. ARBITRATION. Any claim or controversy arising out of or relating to
this Agreement or any breach thereof shall be settled by arbitration if such
claim or controversy is not settled pursuant to Section 4(g) hereof. The venue
for any such arbitration shall be Atlanta, Georgia, or such other location as
the parties may mutually agree. Except as expressly set forth herein, all
arbitration proceedings under this Section 4(h) shall be undertaken in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association (the "AAA") then in force. Only individuals who are (i) lawyers
engaged full-time in the practice of law and (ii) on the AAA register of
arbitrators shall be selected as an arbitrator. There shall be one arbitrator
who shall be chosen in accordance with the rules of the AAA. Within 20 days of
the conclusion of the arbitration hearing, the arbitrator shall prepare written
findings of fact and conclusions of law. Judgment on the written award may be
entered and enforced in any court of competent jurisdiction. It is mutually
agreed that the written decision of the arbitrator shall be valid, binding,
final and non-appealable; provided however, that the parties hereto agree that
the arbitrator shall not be empowered to award punitive damages against any
party to such arbitration. The arbitrator shall require the non-prevailing party
to pay the arbitrator's full fees and expenses or, if in the arbitrator's
opinion there is no prevailing party, the arbitrator's fees and expenses will be
borne equally by the parties thereto. In the event action is brought to enforce
the provisions of this Agreement pursuant to this Section 4(h), the
non-prevailing parties shall be required to pay the reasonable attorneys' fees
and expenses of the prevailing parties, except that if in the opinion of the
court or arbitrator deciding such action there is no prevailing party, each
party shall pay its own attorneys' fees and expenses.
[Signature page follows]
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IN WITNESS WHEREOF, the parties hereto have executed or have caused
this Agreement to be duly executed as of the date first above written.
SELLER
__________________________________
C. Xxxxxxx Xxxxxx
SES
SPECIALTY ELECTRONIC SYSTEMS, INC.
By: ______________________________
Name: ____________________________
Title: ___________________________
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