NONCOMPETITION AND NONDISCLOSURE AGREEMENT
NONDISCLOSURE AND NONCOMPETITION AGREEMENT dated as of November 10, 1997,
between Xxxxxx X. Xxxxxx ("Employee") and TITAN MOTORCYCLE COMPANY OF AMERICA,
INC., a Nevada corporation (the "Company").
RECITALS:
A. Employee is to become an employee of the Company and will derive
substantial benefits as a result of being employed by the Company.
B. Employee's delivery to the Company of this Agreement is a condition to
the Company's agreeing to employ Employee.
C. As an inducement to the employment of Employee, the parties hereto
desire to enter into this Agreement.
AGREEMENT:
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and premises contained herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
1. NONDISCLOSURE.
(a) CONFIDENTIAL INFORMATION. Employee acknowledges and agrees that
the Confidential Information constitutes valuable, special, confidential and
unique assets of the Company. For purposes of this Agreement, "Confidential
Information" means any proprietary information, technical data, trade secrets or
know-how of the Company, its subsidiaries or its affiliates, including without
limitation research, product plans, products, services, customer lists and
customers (including without. limitations customers of the Company with whom
Employee becomes acquainted during the term of Employee's employment or on whom
Employee calls during such term), employee lists and employees, markets,
software, developments, inventions, processes, formulas, technology, designs,
drawings, engineering, marketing, finances, production methods, pricing
information, purchasing information, or other business information of the
Company, its subsidiaries or its affiliates. Confidential Information does, not
include items which (i) become lawfully available to the public other than as a
result of a disclosure by Employee or Employee's representatives or agents, (ii)
was lawfully available on a nonconfidential basis prior to its disclosure by
Employee or Employee's representatives or agents, or (iii) lawfully becomes
available on a nonconfidential basis from a source other than Employee or
Employee's representatives or agents.
(b) NONDISCLOSURE. Employee shall hold the Confidential Information in
trust and the strictest confidence for the Company at all times. Employee shall
not, either during or after the term of his or her employment, use to the
detriment of the Company, or for the benefit of any other person or otherwise
misuse the Confidential Information. Employee shall not directly or indirectly
disclose, divulge, or communicate the Confidential Information to any person
without the prior written consent of the Company. Employee acknowledges that the
Confidential Information that employee acquired or developed while Employee was
an employee of the Company is the property of the Company, and Employee shall
treat the confidential information as a fiduciary of the Company. Employee
agrees not to reproduce or remove from the Company any Company business records
or the Confidential Information, without the prior written consent of the
president or the chief executive officer of the Company or a duly authorized
designee thereof.
(c) FORMER EMPLOYER INFORMATION. Employee shall not, during employment
with the Company, improperly use or disclose any proprietary information or
trade secrets of any former or concurrent employer or other person. Employee
shall not bring onto the premises. of the Company any unpublished document or
proprietary information belonging to any such employer or person, unless
consented to in writing by such employer or person.
(d) THIRD-PARTY INFORMATION. Employee acknowledges and agrees that the
Company has received and in the future will receive from third parties their
confidential or proprietary information subject to a duty on the Company's part
to maintain the confidentiality of such information and to use it only for
certain limited purposes. Employee shall, hold all such confidential or
proprietary information in trust and the strictest confidence. Employee shall
not disclose to any person or use such information, except if necessary in
carrying out Employee's work for the Company consistent with the Company's
agreement with such third party.
2. INVENTIONS.
(a) INVENTIONS RETAINED AND LICENSED. Employee has attached hereto, as
Exhibit A, a list describing all inventions, original works of authorship,
developments, improvements, and trade secrets which were made by Employee prior
to Employee's employment with the Company, which belong to Employee, which
relate to the Company's proposed business, products or research and development,
and which are not assigned to the Company hereunder (collectively referred to as
"Prior Inventions"). If no such list is attached, Employee represents that there
are no such Prior Inventions. If in the course of Employee's employment with the
Company, Employee incorporates into a Company product, process or machine a
Prior Invention owned by Employee or in which Employee has an interest, the
Company is hereby granted and shall have a nonexclusive, royalty-free,
irrevocable, perpetual, worldwide license to make, have made, modify, use and
sell such Prior Invention as part or in connection with such product, process or
machine.
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(b) ASSIGNMENT OF INVENTIONS. Employee agrees that Employee will
promptly make full written disclosure to the Company, will hold in trust for the
sole right and benefit of the Company, and hereby assigns to the Company, or its
designee, all Employee's right, title and interest in and to any and all
inventions, original works of authorship, developments, concepts, improvements
or trade secrets, whether or not patentable or registrable under copyright or
similar laws, which Employee may solely or jointly conceive or develop or reduce
to practice, or cause to be conceived or developed or reduced to practice,
during the period of time Employee is in the employ of the Company
(collectively, "Inventions"). Employee further acknowledges that all original
works of authorship which are made by Employee (solely or jointly with others)
within the scope of, and during the period of Employee's employment with the
Company and which are protectible by copyright are "works made for hire," as
that term is defined in the United States Copyright Act. Employee agrees to keep
and maintain adequate and current written records of all Inventions made by
Employee (solely or jointly with others) during the term of Employee's
employment with the Company. The records will be in the form of notes, sketches,
drawings, and any other format that may be specified by the Company. The records
will be available to and remain the sole property of the Company at all times.
(c) PATENT AND COPYRIGHT REGISTRATIONS. Employee agrees to assist the
Company, or its designee, at the Company's expense, in every proper way to
secure the Company's rights in the Inventions and any copyrights, patents or
other intellectual property rights relating thereto in any and all countries.
Such assistance shall include the disclosure to the Company of all pertinent
information and data with respect thereto, the execution of all applications,
specifications, oaths, assignments and all other instruments which the Company
shall deem necessary in order to apply for -and obtain such rights and in order
to assign and convey to the Company, its successors, assigns and nominees the
sole and exclusive rights, title and interest in and to such Inventions, and any
copyrights, patents or other intellectual property rights relating thereto.
Employee's obligation to execute or cause to be executed, any such instrument or
papers shall continue after the termination of this Agreement. In anticipation
of the possibility that the Company might be unable in the future because of
Employee's mental or physical incapacity or for any other reason to secure
Employee's signature to apply for or to pursue any application for any United
States or foreign patents or copyright registrations covering Inventions or
original works of authorship assigned to the Company as above, Employee hereby
irrevocably designates and appoints the Company and its duly authorized officers
and agents as Employee's agent and attorney in fact, to act for and in
Employee's behalf and stead to execute and file any such applications and to do
all other lawfully permitted acts to further the prosecution and issuance of
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copyright registrations thereon with the same legal force and effect as if
executed by Employee.
3. CONFLICTING EMPLOYMENT. During the term of Employee's employment with
the Company, Employee not engage in any other employment, occupation, consulting
or other business activity directly related to the business in which the Company
is involved. Employee shall not engage in any other activities that conflict
with Employee's obligations to the Company.
4. LEAVING THE COMPANY. At the time of leaving the employ of the Company,
Employee shall deliver to the Company (and shall not keep in Employee's
possession, recreate or deliver to anyone else) any and all devices, records,
data, notes, reports, proposals, lists, correspondence, specifications,
drawings, blueprints, sketches, materials, equipment, other documents or
property, or reproductions of any aforementioned items developed by Employee
pursuant to Employee's employment with the Company or otherwise belonging to the
Company, its successors or assigns. If Employee leaves the employ of the
Company, Employee hereby grants consent to notification by the Company to
Employee's new employer about Employee's rights and obligations under this
Agreement.
5. COVENANT NOT TO COMPETE.
(a) GENERAL. Employee represents, acknowledges and covenants as
follows:
(i) Concurrently with execution of this Agreement, Employee is
becoming an employee of the Company.
(ii) This covenant shall be given the interpretation customarily
and usually given to covenants given in connection with employment, to the end
that the value of the business of the Company and the goodwill held by and
inuring to the benefit of the Company shall not be derogated.
(iii) The restrictions and covenants hereinafter set forth are
reasonable and necessary in order to protect the legitimate interests of the
Company, taking into account all of the terms and conditions thereof and the
circumstances extant at the present time.
(b) COVENANTS. Employee covenants and agrees that for the period
commencing on the date hereof and terminating on the date which is one (1) year
after the date upon which Employee's employment with the Company is terminated
for any reason, within any county in which the Company or any subsidiary or
affiliate of the Company conducts business, or in any other county in any state
of the United States, or any country or political subdivision in the world,
shall not directly or indirectly:
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(i) Enter the employ of, manage, operate, control or render any
services to, any person engaged in any business competitive with the business of
the Company (other than the Company or a subsidiary or affiliate of the
Company);
(ii) Act as advisor or consultant to any person engaged in the
business in which the Company is engaged (other than the Company or a subsidiary
or affiliate of the Company);
(iii) Induce any of the Company's customers to patronize any
other person who competes with the business of the Company, or interfere, in any
manner, with the Company's relationships with its customers;
(iv) Interfere in any manner with the Company's relationships
with its suppliers, distributors, retailers or agents;
(v) Solicit, induce, recruit or encourage any of the Company's
employees to leave their employment, or take away such employees, or attempt any
of the foregoing,
(vi) Engage in such business on his own account;
(vii) Own, hold a financial interest in, participate in, or
otherwise be or become interested in such business, directly or indirectly, as
an individual, owner, proprietor, partner, shareholder, director, officer,
manager, principal, agent, employee, trustee, consultant, independent contractor
or any other relationship or capacity (other than the Company or a subsidiary or
affiliate of the Company);
(viii) Disparage the Company.
For purposes of this Agreement, "the business of the Company" and "such
business" shall mean the business of designing, manufacturing, assembling and
selling motorcycles and parts, accessories and other items used in connection
with or pertaining to motorcycles. Notwithstanding the foregoing provisions of
this Section, nothing contained In this Section shall be deemed to prohibit
Employee from acquiring, solely as an investment, less than 2% of the
outstanding publicly-traded shares of capital stock of any corporation.
6. ENFORCEMENT.
(a) INADEQUATE LEGAL REMEDIES. Employee acknowledges and agrees that
the purposes of this Agreement include without limitation the preservation and
protection of the Company's valuable intangible and intellectual property
rights, the value of which is not easily susceptible to measurement. Employee
further acknowledges and agrees, therefore, that no remedy at law exists
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adequately to protect the Company in the event Employee breaches any of the
covenants contained herein. Accordingly, if the Company institutes any
proceeding to enforce any provision hereof, Employee hereby waives the claim or
defense that the Company has an adequate remedy at law.
(b) REMEDIES. If Employee commits a breach, or threatens to commit a
breach, of any of the provisions of this Agreement, the Company shall have the
following rights and remedies:
(i) The right and remedy to have the provisions hereof
specifically enforced by any court having equity jurisdiction, including the
right to enjoin the acts of Employee which constitute a breach of such covenant
by temporary restraining order, injunction pendente lite and permanent
injunction, and, where applicable and necessary to provide complete relief to
the Company, by mandatory injunction.
(ii) The right and remedy to require Employee to account for and
pay over to the Company all compensation, profits, monies, accruals, increments
or other benefits (collectively, "Benefits") derived or received by Employee as
the result of any transactions constituting a breach of any of the provisions of
this Section. Employee hereby agrees to account for and pay over such Benefits
to the Company.
(iii) In furtherance of and in addition to the foregoing, for
each separately identifiable breach of a covenant set forth herein, Employee
shall be obligated to pay to the Company as liquidated damages, and not as a
penalty, the sum of $5,000. In the case of a continuing violation, each day
thereof shall constitute a separately identifiable breach.
Each of the rights and remedies enumerated above shall be independent of the
other, and shall be severally enforceable, and all of such rights and remedies
shall be in addition to, and not in lieu of, any other rights and remedies
available to the Company under law or in equity.
7. SEVERABILITY.
(a) GENERAL. If any of the covenants contained herein, or any part
thereof, is hereafter construed to be invalid or unenforceable, then (at the
election of the Company) the same shall not affect the remainder of the covenant
or covenants, which shall be given full effect, without regard to the invalid
portions.
(b) AUTOMATIC REFORMATION. If a court of competent jurisdiction shall
find that any of the covenants contained herein, or any part thereof, is
excessively broad as to geographic area, time, duration, scope, activity or
subject, the parties agree that such covenant shall be construed solely in a
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manner that shall limit or reduce it (or any particular aspect or aspects
thereof) so as to render the covenant enforceable to the maximum extent
compatible with then applicable law. The court making such finding is hereby
authorized, and shall have the power, to so limit or reduce such provision. In
its limited or reduced form, said provision shall then be enforceable.
(c) TOLLING. In the event of any breach or violation of the
restrictions contained herein, the time period specified herein shall xxxxx
during the time of any violation or breach hereof, and that portion remaining at
the time of commencement of any violation shall not begin to run until such
violation has been fully and finally cured.
(d) INDEPENDENCE. The covenants contained herein shall be construed as
constituting agreements independent of any other agreements. given or made in
connection with this Agreement, so that the existence. of any claim or cause of
action by any party to any of the other agreements against the Company, whether
predicated on this Agreement or any of the other agreements, or otherwise, shall
not constitute a defense to the enforcement by the Company of such covenants.
8. NO OTHER AGREEMENTS; CONSIDERATION. Employee represents and warrants
that Employee is not a party to any other agreement which will interfere with
Employee's full compliance herewith. Employee also represents and warrants that
a significant portion of Employee's compensation constitute part of the
consideration for the covenants and agreements made by Employee herein.
9. NON-ALIENATION. The covenants, agreements and representations of
Employee contained herein are personal in nature, and Employee shall not,
without the prior written consent of the Company, assign, delegate or transfer
this Agreement or any rights or obligations hereunder, except that this
Agreement shall insure to the benefit of and be binding upon Employee's estate,
heirs and personal representatives. The Company shall be entitled to assign,
delegate, or transfer this Agreement or any of the Company's rights or
obligations hereunder to any person. In the case and to the extent of any such
assignment, delegation or transfer by the Company, this Agreement shall subject
to the provisions hereof, be binding upon and insure to the benefit of such
person, and such person shall discharge and perform all the obligations of the
Company hereunder. Employee shall not have any right to pledge, hypothecate,
anticipate or in any way create a lien upon any interest of Employee in or
arising under this Agreement. No benefits arising or payable hereunder shall be
assignable by Employee in anticipation of payment either by voluntary or
involuntary acts, or by operation of law.
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10. COUNTERPARTS. This Agreement may be executed in any number of
counterparts. Each counterpart shall be deemed an original instrument. All
counterparts collectively shall be a single Agreement, binding on all of the
parties hereto, notwithstanding that all of the parties are not signatory to the
original or the same counterparts.
11. BINDING EFFECT. Subject to the provisions hereof restricting
assignment, this Agreement shall be binding upon and inure to the benefit of the
parties hereto, their legal representatives, successors and assigns.
12. APPLICABLE LAW; JURISDICTION. This Agreement shall be governed by and
construed in accordance with the laws of the State of Arizona without giving
effect to any choice of law provision or rule (whether of the State of Arizona
or any other jurisdiction) that would cause the application of the law of any
jurisdiction other than the State of Arizona. The parties agree that each of
them is and shall remain subject to the exclusive in personam, in rem and
subject matter jurisdiction of the courts of the State of Arizona (including the
Federal District Court for the District of Arizona) for all purposes pertaining
to this. Agreement and all documents and instruments executed in connection or
in any way pertaining thereto.
13. HEADINGS. Title or captions contained in this Agreement are inserted
only as a matter of convenience and for reference. Such titles and captions
shall not be construed to define, limit, extend or describe the scope of this
Agreement nor the intent of any provision thereof.
14. GENDER AND NUMBER. Whenever required by the context hereof, the
singular shall include the plural and vice versa, and the masculine gender shall
include the feminine and neuter genders and vice versa.
15. FURTHER INSTRUMENTS. Each party hereby agrees that it shall, from time
to time and at such time as may be required, take such further actions and
execute such further documents as may be reasonably required and necessary to
effectuate the provisions hereof.
16. ATTORNEYS' FEES. In case of any action or proceeding to compel
compliance with, or for a breach of, any of the terms and conditions of this
Agreement, the prevailing party shall be entitled to recover from the
non-prevailing party costs of such action or proceedings, including without
limitation reasonable attorneys' fees, costs and disbursements.
17. TIME OF ESSENCE. Time is of the essence hereof.
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18. COMPUTATION OF TIME. In computing any period of time pursuant to this
Agreement, the day or date of the act, notice, event or default from which the
designated period of time begins to run will not be included. The last day of
the period so computed will be included, unless it is a Saturday, Sunday or a
legal holiday in the State of Arizona, in which event the period runs until the
end of the next day which is not a Saturday, Sunday or such legal holiday.
19. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties. This Agreement supersedes any prior agreement or
understanding among the parties and may not be modified or amended in any manner
other than as set forth herein.
20. SURVIVAL. It is the express intention land agreement of the parties
that all covenants, agreements, statements, representation and warranties made
in this Agreement shall survive the execution and delivery of this Agreement.
21. WAIVERS. No modification or waiver of any provision of this Agreement
shall be effective unless the same be in writing executed, by the party to be
charged with such modification or waiver. Neither the. waiver by a party of a
breach of or a default under any of the provisions of this Agreement, nor the
failure of a party on one or more occasions to enforce any of the provisions of
this Agreement or to exercise any right, remedy or privilege hereunder shall
thereafter be construed as a waiver of any subsequent breach or default of a
similar nature, or as a waiver of any such provisions, rights remedies or
privileges hereunder.
22. EXERCISE OF RIGHTS. No failure or delay on the part of a party in
exercising any right, power or privilege hereunder and no course of dealing
between the parties shall operate as a waiver or abandonment thereof, nor shall
any single or partial exercise of any right, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies herein expressly provided are
cumulative and not exclusive of any other rights or remedies which party would
otherwise have at law or in equity otherwise.
23. LIMITATION ON BENEFITS ON THIS AGREEMENT. It is the explicit intention
of the parties that (a) no person or entity other than the parties (or their
respective successors and assigns as permitted hereunder) is or shall be
entitled to bring any action or enforce any provision of this Agreement against
any party, and (b) the covenants, undertakings and agreements set forth in this
Agreement shall be solely for the benefit of, and shall be enforceable only by,
the parties (or their respective successors and assigns as permitted hereunder).
24. NOTICES. Notices and other communications hereunder shall be sufficient
if in writing and if sent by registered or certified mail, by express courier or
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by hand-delivery to Employee at the last address Employee has filed in writing
with the Company or to the Company at its principal executive offices, or at
such other address as such party may advise the other party in writing.
25. AMENDMENT. This Agreement may be amended, supplemented or modified only
by a written instrument signed by all of the parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
EMPLOYEE:
Signature: /s/ Xxxxxx X. Xxxxxx
-----------------------------
Print Name: Xxxxxx X. Xxxxxx
----------------------------
COMPANY:
TITAN MOTORCYCLE COMPANY OF AMERICA,
INC., a Nevada corporation
By /s/ Xxxxxx Xxxxxx
-------------------------------------
Its
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