EXHIBIT 10.1
NON-COMPETE/NON-SOLICITATION AGREEMENT
This NON-COMPETE AND NON-SOLICATION AGREEMENT (the "AGREEMENT") is made
and entered into this 27th day of July, 2001, by and between STRATUS SERVICES
GROUP, INC., a Delaware company ("Stratus"), and SOURCE ONE PERSONNEL, INC., a
New Jersey company ("Source One").
RECITALS:
WHEREAS, Source One and Stratus have executed an Asset Purchase Agreement
whereby Stratus has purchased the ongoing clerical and light industrial staffing
business of Source One (the "Acquired Business"); and
WHEREAS, Source One possesses substantial information and knowledge
regarding the Acquired Business operations; and
WHEREAS, Stratus and Source One desire to enter into an agreement whereby
Source One agrees not to compete with the Acquired Business
NOW, THEREFORE, for consideration, the receipt and sufficiency of which is
hereby acknowledged, and other good and valuable consideration, the parties
hereto agree as follows:
CONFIDENTIALITY AND TRADE SECRETS
Source One acknowledges that the manuals, methods, forms, techniques and
systems which it has sold to Stratus whether for its own use or for use by or
with its clients, are confidential trade secrets and are the property of
Stratus.
Source One further acknowledges that it has had access to confidential
information concerning the Acquired Business' clients, including their business
affairs, special needs, preferred methods of doing business, methods of
operation, key contact personnel and other data, all of which provides Stratus
with a competitive advantage and none of which is readily available except to
Source One and employees of Stratus.
Source One further acknowledges that it has had access to the names,
addresses, telephone numbers, qualifications, education, accomplishments,
experience, availability, resumes and other data regarding persons who have
applied or been recruited for temporary or permanent employment by the Acquired
Business, as well as job order specifications and the particular characteristics
and requirements of persons generally hired by a client, specific job listings,
mailing lists, computer runoffs, financial and other information, all of which
provides Stratus with a competitive advantage and none of which is readily
available except to Source One and employees of Stratus.
Source One agrees that all of the foregoing information regarding the
Acquired Business' methods, clients and employees constitutes valuable and
proprietary trade secrets and confidential information of Stratus (hereafter
"Confidential Information").
NON-COMPETITION AGREEMENT
Source One agrees that it shall not, for a period of eighteen (18) months
from the date of the Asset Purchase Agreement either directly or indirectly, on
its own account or as agent, stockholder, employer, or otherwise in conjunction
with any other person or entity, engage in competition with the Acquired
Business, or act in concert with a business in competition with the Acquired
Business in Eastern Pennsylvania and Delaware. Source One further agrees that
regardless of geographic location, it will not, during said time period and
unless otherwise agreed to by the parties, service any customers of the Acquired
Business that it has done any business with during the preceding eighteen (18)
months in the line of the Acquired Business. Source One acknowledges that doing
so in any manner would interfere with, diminish and otherwise jeopardize and
damage the business and goodwill of the Acquired Business.
NON-DISCLOSURE AGREEMENT
Source One agrees that except as directed by Stratus, it will not at any
time use for any reason or disclose to any person any of the Confidential
Information of the Acquired Business or permit any person to examine and/or make
copies of any documents which may contain or are derived from Confidential
Information, whether prepared by Source One or otherwise, without the prior
written permission of Stratus in the retained business.
AGREEMENT NOT TO COMPETE FOR ACCOUNTS OR PERSONNEL
Source One agrees that during the forty-eight (48) months after the Asset
Purchase Agreement it will not, directly or indirectly, contact, solicit,
divert, take away or attempt to contact, solicit, divert or take away any staff
employee, temporary personnel, customer, account, business or goodwill from
Stratus in the Acquired Business, either for Source One's own benefit or some
other person or entity, and will not aid or assist any other person or entity to
engage in any such activities.
LIMITATION AND TERMINATION OF RESTRICTIVE COVENANTS
Notwithstanding anything contained in this Agreement to the contrary, the
parties hereto acknowledge and agree that Source One shall continue to operate
its business, other than in the Acquired Business (as defined in the Asset
Purchase Agreement), including, without limitation, information technology,
accounting, scientific, engineering, legal and human resources management
placement, and professional, scientific, medical staffing and any other business
not in competition with the Acquired Business (the "Retained Business"), and (i)
Source One's continued operation of the Retained Business shall not be deemed to
violate the Non-Competition Agreement set forth above; (ii) Source One shall be
permitted to use and disclose Confidential Information to the extent it overlaps
with Source One's confidential information related to the Retained Business
without being in violation of the Non-Disclosure Agreement set forth above; and
(iii) Source One shall be permitted to solicit business from and provide
services to customers of Stratus, provided that such solicitation of business
and provision of services relates to its Retained Business.
Notwithstanding the covenant periods set forth above, if, within thirty
(30) months of the date of this Agreement, an Event of Default occurs and any
event occurs, which upon notice or passage of time would constitute an Event of
Default, under the Asset Purchase Agreement or any of other document referred to
in the Asset Purchase Agreement to which Stratus is a party, this Agreement and
the covenants contained herein shall become null and void. Without limiting the
foregoing, should this Agreement become null and void, Source One shall be
permitted to compete with Stratus in the Acquired Business and solicit Stratus's
staff employees, temporary personnel, customers, accounts and business. If such
an Event of Default shall occur, Stratus hereby releases Source One, without
further action on Stratus's part,
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from any and all claims that Stratus may have arising from such competition or
solicitation. In the event that Stratus has entered into any employment,
non-competition and/or non-solicitation agreement with any staff employees
and/or temporary personnel, Stratus hereby releases such staff employees and/or
temporary personnel from the restrictive covenants contained therein with
respect to employment by or through Source One.
STRATUS SERVICES GROUP, INC. SOURCE ONE:
/s/ Xxxxxx X. Xxxxxxx /s/ Xxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx Xxxxx X. Xxxxxxx
Chairman and CEO President
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