NONCOMPETITION AGREEMENT
This Noncompetition Agreement (this "Agreement") is made as of
_____________, 1999, by and between Xxxxxxxxxxx.xxx, Inc., a Delaware
corporation, ("Parent"), and Xxxxx Xxxxxxxx, an individual resident of New
Jersey ("Covenantee").
RECITALS
Concurrently with the execution and delivery of this Agreement, Parent is
acquiring Cyber-Tech, Inc., a New Jersey corporation (the "Company") pursuant to
the merger of the Company with and into MCNS Merger Subsidiary, II, Inc., a
wholly-owned Subsidiary of Parent ("Subsidiary") pursuant to the terms and
conditions of that certain Merger Agreement and Plan of Reorganization (the
"Merger Agreement") dated __________, 1999, by and among Parent, Subsidiary, the
Company, and the shareholders of the Company. Section 6.10 of the Merger
Agreement requires that noncompetition agreements be executed and delivered by
each of Xxxxx Xxxxxxxx, Xxxxxx X. Xxxxx, M.D. and Xxxxxx Xxxxxxxx as a condition
to the consummation of the transactions contemplated by the Merger Agreement.
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 Merger Agreement.
2. NON-COMPETITION, NON-SOLICITATION.
(a) Non-Competition. In connection with the acquisition of the Company by
Parent pursuant to the terms of the Merger Agreement, the Covenantee hereby
agrees that during the period commencing on the date hereof and ending on the
second anniversary of the date on which the Covenantee's employment with the
Parent and its subsidiaries and affiliates terminates for any reason (the
"Non-Compete Period"), he will not, without the express written consent of the
Parent, directly or indirectly, anywhere in the United States or Canada, engage
in any activity which is, or participate or invest in, or provide or facilitate
the provision of financing to, or assist (whether as owner, part-owner,
shareholder, member, partner, director, officer, trustee, employee, agent or
consultant, or in any other capacity), any business, organization or person
other than the Parent (or any subsidiary or affiliate of the Parent), whose
business, activities, products or services are directly competitive with any of
the business, activities, products or services conducted by the Parent on the
date the Covenantee's employment with the Parent terminates and over which the
Covenantee has had responsibility and which are in the Parent's Field of
Interest (each a "Competitive Business"); provided that the Covenantee shall be
permitted to be employed by an entity which operates an ancillary business in
the Parent's Field of Interest so long as the Covenantee is not involved in such
ancillary business. For purposes of this Section 2(a), the Parent's "Field of
Interest" shall consist of the development, implementation or sale of on-line or
Internet marketing or advertising programs to pharmaceutical and other
healthcare organizations and any other on-line or Internet health care
related business activity engaged in, or conducted by the Parent or its
subsidiaries or affiliates on the date the Covenantee's employment with the
Parent terminates, but only to the extent the Covenantee has had responsibility
over such business activity. Notwithstanding anything in this Section 2(a) to
the contrary, the Covenantee shall not be prohibited from participating,
directly or indirectly, in any activity or business (i) with Internet operations
outside the health care fields, including but not limited to companies providing
non-health care goods or services through the Internet or providing e-commerce
services or content that is not a Competitive Business; or (ii) related to
health care services, other than on-line or Internet-based or related
businesses.
Notwithstanding anything herein to the contrary, the Covenantee may make
passive investments in any enterprise the shares of which are publicly traded if
such investment constitutes less than five percent (5%) of the equity of such
enterprise.
(b) Non-Solicitation. In addition to the restrictions in Section 2(a)
above, the Covenantee also agrees that he will not during the Non-Compete
Period: (i) solicit or encourage any officer or employee of the Parent or its
direct or indirect subsidiaries or affiliates to terminate his or her
relationship or employment with such entity; or (ii) on behalf of himself or any
persons or entity, other than the Parent or any of its direct or indirect
subsidiaries and affiliates, solicit business from any client of the Parent or
its direct or indirect subsidiaries in the Parent's Field of Interest; provided,
however, that the foregoing provision will not prevent the Covenantee from
employing or offering to employ any such person who has been terminated by the
Parent or a subsidiary or affiliate prior to the commencement of employment
discussions between the Covenantee and such employee, and the Covenantee will be
permitted to hire and offer to hire non-shareholder employees of the Parent who
are contacted as a result of the use of general newspaper or electronic
advertisement and other general non-targeted recruitment techniques in the
ordinary course of business and consistent with past practices as opposed to
targeted solicitations of any one or more of the Parent's employees.
For purposes of this Agreement, any reference to the subsidiaries of the
Parent shall be deemed to include all entities directly or indirectly controlled
by it through an ownership of more than fifty percent (50%) of the voting
interests, the term "affiliate" shall mean, with respect to any person or
entity, any person or entity which directly or indirectly controls, is
controlled by or is under common control with such person or entity, and the
term "person" shall mean an individual, a parent, an association, a partnership,
a limited liability company, an estate, a trust, and any other entity or
organization.
(c) Scope of Agreement. The parties acknowledge that the time, scope,
geographic area and other provisions of this Section 2 have been specifically
negotiated by sophisticated commercial parties and agree that (i) all such
provisions are reasonable under the circumstances of this Agreement, (ii) are
given as an integral and essential part of this Agreement and (iii) but for the
covenants of the Covenantee contained in this Section 2, the Parent would not
have entered into this Agreement. The Covenantee has independently consulted
with his counsel and has been advised in all respects concerning the
reasonableness and propriety of the covenants contained herein, with specific
regard to the business to be conducted by the Parent and its subsidiaries and
affiliates, and represents that this Agreement is intended to be, and shall be,
fully enforceable and effective in accordance with its terms.
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(d) Severability. In the event that any covenant contained in this
Agreement shall be determined by any court of competent jurisdiction to be
unenforceable by reason of its extending for too great a period of time or over
too great a geographical area or by reason of its being too extensive in any
other respect, it shall be interpreted to extend only over the maximum period of
time for which it may be enforceable and/or over the maximum geographical area
as to which it may be enforceable and/or to the maximum extent in all other
respects as to which it may be enforceable, all as determined by such court in
such action.
3. CONSIDERATION
As consideration for Covenantee's performance of the covenants and
obligations set forth herein, Parent is this day delivering to Covenantee by
certified check or other check acceptable to Covenantee, the sum of $250,000.
4. REMEDIES
If Covenantee breaches the covenants set forth in Section 2 of this
Agreement, Parent and the Company will be entitled to the following remedies:
(a) damages from Covenantee;
(b) 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 Section
2 of this Agreement, it being agreed that money damages alone would be
inadequate to compensate the Parent and the Company and would be an inadequate
remedy for such breach.
The rights and remedies of the parties to this Agreement are cumulative
and not alternative.
5. SUCCESSORS AND ASSIGNS
This Agreement will be binding upon Parent, the Company and Covenantee and
will inure to the benefit of Parent and the Company and their affiliates,
successors and assigns and Covenantee and Covenantee's assigns, heirs and legal
representatives.
6. WAIVER
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
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party giving such notice or demand to take further action without notice or
demand as provided in this Agreement.
7. GOVERNING LAW
This Agreement will be governed by the laws of the State of New Jersey
without regard to conflicts of law principles.
8. 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 United States District Court for the District of New Jersey, or
if jurisdiction and venue is not proper in federal courts, then the Superior
Court of New Jersey, 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.
9. 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 2 of this Agreement are held to be
unreasonable, arbitrary, or against public policy, such covenants will be
considered divisible with respect to scope, time, and geographic area, and in
such lesser scope, time and geographic area, will be effective, binding and
enforceable against Covenantee.
10. 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.
11. 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.
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12. 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 (effective upon written confirmation of receipt), (b) sent by
facsimile (effective upon written confirmation of receipt), provided that a copy
is mailed by registered mail, return receipt requested, or (c) 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):
Covenantee:
_____________
_____________
_____________
Facsimile No.:___________________
with a copy to (which shall not constitute notice):
Xxxxx Xxxxxxx
000 Xxxxxxxxxx Xxxxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Facsimile No.: (000) 000-0000
Parent or Company:
Xxxxxxxxxxx.xxx, Inc.
00 Xxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxx XXXX
Xxxxxxx
Attention: Xxxxxx X. Xxxxxxxx, CEO
with a copy to:
Xxxxxxxxxxx.xxx, Inc.
0000 Xxxxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attention: E. Xxxxxxx Xxxxxx, General Counsel
13. ENTIRE AGREEMENT
This Agreement, the Merger Agreement (together will exhibits and schedules
attached thereto), and the documents executed in connection with the Merger
Agreement 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 Parent and
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Covenantee 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.
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IN WITNESS WHEREOF, the corporate party hereto has caused this Agreement
to be executed and delivered by its duly authorized representative, and the
individual party hereto has executed and delivered this Agreement, as of the
date first above written.
PARENT:
Xxxxxxxxxxx.xxx, Inc.
By:____________________________
Name:__________________________
Title:_________________________
COVENANTEE:
_______________________________
Xxxxx Xxxxxxxx
