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EXHIBIT 10.28
NON-COMPETE AGREEMENT
This NON-COMPETE AGREEMENT made this 1st day of September, 1998 by and
among H & S Management Corp., a Colorado corporation ("H&S"), X. X. Xxxxxxxx, a
Colorado resident ("Xxxxxxxx"), and Xxxxxx Xxxxxx, a Colorado resident
("Xxxxxx") (individually, each of H&S, Xxxxxxxx and Xxxxxx is referred to herein
as a "Covenantee", and collectively, the "Covenantees"), and Universal
Electronics Inc., a Delaware corporation ("UEI").
W I T N E S S E T H:
WHEREAS, Covenantees and UEI have entered into a certain Asset Purchase
Agreement dated September 1, 1998 ("Purchase Agreement") (unless otherwise
defined herein, capitalized terms shall be used herein as defined in the
Purchase Agreement) pursuant to which UEI will purchase from H&S the H&S Remote
Control Business and the H&S Remote Control Assets; and
WHEREAS, pursuant to the terms of the Purchase Agreement, UEI has agreed
to pay Covenantees a total of $______________________ for this Non-Compete
Agreement, with such payment allocated among the Covenantees as set forth on the
allocation schedule attached to the Purchase Agreement; and
WHEREAS, it is a condition to the Closing under the Purchase Agreement
that this Non-Compete Agreement be entered into by each of the Covenantees and
by UEI;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements hereinafter set forth, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. NON-COMPETE; NON-SOLICITATION. In consideration of the consideration
paid to each of the Covenantees for this Agreement as described above and in the
Purchase Agreement, each Covenantee covenants and agrees that, for a period of
seven (7) years from the date hereof (the "Non-Compete Period") Covenantee shall
not, directly or indirectly, either alone or in partnership or jointly or in
conjunction with any person or persons, firm, association, syndicate, company or
corporation as principal, agent, employee, director, shareholder or in any other
manner whatsoever (i) carry on or be engaged in the H&S Remote Control Business
or any other business which is in competition with the H&S Remote Control
Business as existing on the date hereof, (ii) solicit business from or transact
business with any person, firm or corporation to whom UEI or any Covenantee has
sold products where such solicitation would involve the sale of products
competitive with those of the H&S Remote Control Business, or (iii) directly or
indirectly solicit for employment, offer employment to, or hire any person (as
an employee or consultant), or other engage in business any person or persons
who is or are employed by UEI immediately after the consummation of the
transactions contemplated by the Purchase Agreement or during the Non-Compete
Period, except with the prior written consent of UEI.
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1.1 EXCEPTIONS TO NON-COMPETE; NON-SOLICITATION. Nothing within Section
1, above shall prohibit any Covenantee from (i) carrying on or being engaged in
any type of business, which is not competitive with the H&S Remote Control
Business in any area whatsoever, or (ii) being an owner of not more than 5% of
the outstanding stock of any class of a corporation which is publicly traded
whose principal business is competitive with the H&S Remote Control Business, so
long as Covenantee has no active participation in the business of such
corporation.
2. REMEDIES. Each Covenantee acknowledges that the covenants and
agreements which it has made in this Agreement are reasonable and are required
for the reasonable protection of UEI's investment in the H&S Remote Control
Assets and the H&S Remote Control Business. Each Covenantee agrees that the
breach of any covenant or agreement contained herein will result in irreparable
injury to UEI, and that in addition to all other remedies provided by law or in
equity with respect to the breach by Covenantee of any provision of this
Agreement, UEI and its successors and assigns will be entitled to enforce the
specific performance by Covenantee of Covenantee's obligations hereunder and to
enjoin Covenantee from engaging in any activity in violation hereof, all without
the need of posting bond or any other security, and that no claim by Covenantee
against UEI or its successors or assigns will constitute a defense or bar to the
specific enforcement of such obligations. Each Covenantee agrees that UEI and
any successor or assign shall be entitled to recover all costs of successfully
enforcing any provision of this Agreement, including reasonable attorneys' fees
and costs of litigation (including incurred in connection with any
administrative, alternative dispute resolution or appellate proceeding) and any
interest. In the event of a breach or a violation by any Covenantee of any of
the provisions of this Agreement, the running of the Non-Compete Period, shall
be tolled during the period of the continuance of any actual breach or
violation.
3. PARTIAL INVALIDITY. The various covenants and provisions of this
Agreement are intended to be severable and to constitute independent and
distinct binding obligations and of each of the Covenantees. Should any covenant
or provision of this Agreement be determined to be void and unenforceable, in
whole or in part, it shall not be deemed to affect or impair the validity of any
other covenant or provision or part thereof, and such covenant or provision or
part thereof shall be deemed modified to the extent required to permit
enforcement. Without limiting the generality of the foregoing, if the scope of
any covenant contained in this Agreement is too broad to permit enforcement to
its full extent, such covenant shall be enforced to the maximum extent permitted
by law, and the Covenantees hereby agree that such scope may be judicially
modified accordingly.
4. ASSIGNMENT. Each Covenantee agrees that this Agreement may be
assigned by UEI to any entity controlled by, or under direct or indirect common
control with, UEI and to any person to whom UEI sells its business or assets,
and that upon any such assignment, such assignee shall acquire all of UEI's
rights under this Agreement, including without limitation the right of
assignment set out in this Section 4.
5. NO STRICT CONSTRUCTION. The language used in this Agreement will be
deemed to be the language chosen by the parties hereto to express their mutual
intent, and no rule of strict
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construction will be applied against any party hereto.
6. NOTICE. Any notice or other communication required or permitted to be
given hereunder shall be in writing and shall be deemed to have been duly given
to any party (i) upon delivery to the address of such party specified below if
delivered in person or by courier, or if sent by certified or registered mail
(return receipt requested), postage prepaid, (ii) upon dispatch if transmitted
by telecopy or other means of facsimile, in any case to the parties at the
following address(es) or telecopy number(s), as the case may be:
If to any Covenantees:
Xx. X. X. Xxxxxxxx
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Facsimile No.: (000) 000-0000
Telephone No.: (000) 000-0000
If to UEI:
Universal Electronics Inc.
0000 Xxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn.: President
Facsimile No.: (000) 000-0000
Telephone No.: (000) 000-0000
With required copies to:
Universal Electronics Inc.
0000 Xxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn.: General Counsel
Facsimile No.: (000) 000-0000
Telephone No.: (000) 000-0000
or to such address(es) or telecopy number(s) as any party may designate by
written notice in the aforesaid manner.
7. WAIVER OF BREACH. The waiver by any party hereto of a breach of any
provision of this Agreement by any other party shall not operate or be construed
as a waiver of any subsequent breach.
8. ENTIRE UNDERSTANDING. This Agreement and the agreements referred to
herein
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constitute the entire understanding and shall not be changed, altered, modified
or discharged, except in writing consented to by all parties.
9. BINDING EFFECT. This Agreement shall be binding upon the
administrators, legal representatives, heirs and legatees and the successors and
assigns of each Covenantee and UEI.
10. GOVERNING LAW. This Agreement shall be construed and enforced in
accordance with the laws of the State of California, without regard to its
conflicts of laws provisions.
11. COUNTERPARTS. This Agreement shall be executed in several
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one in the same agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date
first above written.
COVENANTEES: UEI:
H & S MANAGEMENT CORP. UNIVERSAL ELECTRONICS INC.
By: By:
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Its: Xxxxxxx Xxxxx, President & CEO
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X. X. XXXXXXXX
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XXXXXX XXXXXX
