NON-COMPETE AND NON-SOLICITATION AGREEMENT
EXHIBIT
10.64
This
NON-COMPETE
AND NON-SOLICITATION AGREEMENT
(the
“Agreement”)
is made
and entered into this 7th day of December, 2005, by and between STRATUS
SERVICES GROUP, INC.,
a
Delaware company (“Stratus”)
and
SOURCE
ONE PERSONNEL,
INC.,
a New
Jersey corporation (“Source One”).
RECITALS:
WHEREAS,
Source One and Stratus have executed an Asset Purchase Agreement whereby
Source
One has purchased a portion of Stratus’ business as more particularly described
in the Asset Purchase Agreement (the “Purchased Business”); and
WHEREAS,
Stratus has retained that portion of its business other than the Purchased
Business (the “Retained Business”), which includes nationwide customers and
accounts; and
WHEREAS,
Stratus possesses substantial information and knowledge regarding the Purchased
Business; and
WHEREAS,
the parties desire to enter into an agreement whereby Stratus agrees not
to
compete with Source One relating to the Purchased 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:
|
1.
|
Confidentiality
and Trade Secrets
|
(a) Stratus
acknowledges that it has had access to Confidential Information concerning
the
Purchased Business and clients relating thereto, 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 edge and none of which is readily available except to
Stratus
and Source One.
(b) Stratus
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 in connection with the Purchased 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 edge and none of which is readily available
except to Stratus and Source One.
(c) Stratus
agrees that all of the Confidential Information, including, but not limited
to
the information described in Sections 1(a) and (b), constitutes valuable
and
proprietary trade secrets and confidential information of Source
One.
1
(d) “Confidential
Information” means any proprietary information, technical data, trade secrets or
know-how, including, but not limited to, research, product plans, products,
services, customer lists and customers, software, developments, inventions,
processes, technology, designs, drawings, hardware and software configuration
information, marketing, financial or other business information relating
to the
Purchased Business, including the terms of the Asset Purchase Agreement and
this
Agreement. Confidential Information may also include proprietary information,
trade secrets or know-how received in confidence from third
parties.
|
2.
|
Non-Competition
Agreement
|
Stratus
agrees, on its own behalf and on behalf of its affiliates, that neither it
nor
any affiliate will, during the two (2) year period commencing with the Effective
Date of the Asset Purchase Agreement (“Restrictive Period”), directly or
indirectly, own, manage, control, join, operate, perform, finance, participate
in, permit their names to be used in connection with, or otherwise be engaged
in
a business that competes with the Purchased Business. Stratus acknowledges
that
doing so in any manner would interfere with, diminish and otherwise jeopardize
and damage the business and goodwill of the Purchased Business. For purposes
of
this Section 2, “participate” includes any direct or indirect interest in any
enterprise, whether as a stockholder, partner, joint venturer or otherwise
or
rendering any direct or indirect service or assistance (including as a creditor
for money borrowed) to any person. Notwithstanding the foregoing, Stratus
retains the right to continue to service the Retained Business.
|
3.
|
Non-Disclosure
Agreement
|
Stratus
agrees that except as directed by Source One, it will not at any time use
for
any reason or disclose to any person any Confidential Information of Source
One
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
Stratus or otherwise, without the prior written permission of Source
One.
|
4.
|
Agreement
Not to Compete for Accounts or
Personnel
|
(a) Stratus,
for itself and on behalf of its affiliates, agrees that during the Restrictive
Period neither it nor any affiliate will, directly or indirectly, solicit,
cause
any other person to solicit or assist any other person in soliciting, the
employment of, or hire as a staff employee, leased employee, temporary employee
or otherwise engage as a contractor, any person who is, at the time of such
solicitation, hiring or engagement, or who was within twelve (12) months
of such
solicitation, hiring or engagement, a staff employee, leased employee, temporary
employee or contractor of Source One or the Purchased Business and it will
not
induce any person employed or engaged by Source One in any capacity to terminate
his or her employment or engagement with Source One; provided that the foregoing
shall not prohibit any general solicitation or advertising activities not
targeted to any such person by Stratus or any affiliate.
(b) Stratus,
for itself and on behalf of its affiliates, agrees that during the Restrictive
Period neither it nor any affiliate will, directly or indirectly, solicit,
cause
any other person to solicit, or assist any other person with soliciting any
customer or client or prospective customer
2
or
client
of Source One or the Acquired Business to (i) terminate or otherwise modify
such customer’s or client’s relationship with Source One or (ii) become a
customer or client of another company which is in competition with Source
One.
(c) Nothing
contained in this Section 4 shall be deemed to prohibit or otherwise limit
Stratus’ ability to service the Retained Business.
|
5.
|
No
Adequate Remedy at Law
|
Stratus
acknowledges and agrees that any
breach or threatened breach by of this Agreement by Stratus would cause
immediate and irreparable injury to Source One and that money damages alone
would not provide an adequate remedy
in the
event Stratus breaches any of the above covenants. Accordingly, Stratus agrees
that Source One shall have the right to seek and obtain an injunction to
enjoin
any such breach by Stratus without the requirement of the posting of a bond
and,
if Source One shall institute any action or proceeding to enforce those
covenants, Stratus hereby waives and agrees not to assert the claim or defense
that Source One has an adequate remedy at law. The foregoing shall not prejudice
Source One’s right to require Stratus to account for and pay over to Source One
the amount of any damages incurred by Source One as a result of any such
breach.
|
6.
|
Scope
and Duration
|
It
is
expressly understood and agreed that Stratus and Source One consider the
restrictions contained in this Agreement to be reasonable and necessary for
the
purposes of preserving and protecting the goodwill, legitimate business
interests, and proprietary trade secrets and confidential information of
Source
One. Nevertheless, if any of the aforesaid restrictions are found by a court
having jurisdiction to be unreasonable, or to be overbroad as to geographic
area, or time,
or with
respect to a particular scope of commerce,
or to
be otherwise unenforceable, the parties intend for the restrictions set forth
above to be modified by such court so as to be reasonable and enforceable
and,
as so modified by the court, to be fully enforced.
|
7.
|
Successors
and Assigns
|
This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns, except that neither party may
assign its obligations hereunder without the prior written consent of the
other
parties hereto; provided,
however,
that
Source One may assign Source One’s rights hereunder to a subsidiary or other
affiliate of Source One, including, without limitation, Source One Staffing
Solutions, LLC, a New Jersey limited liability company.
|
8.
|
Entire
Agreement; Amendment
|
This
Agreement, all schedules and exhibits hereto, and all agreements and instruments
to be delivered by the parties pursuant hereto represent the entire
understanding and agreement between the parties hereto with respect to the
subject matter hereof and supersede all prior oral and written, and all
contemporaneous oral negotiations, commitments and understandings between
such
parties. Stratus and Source One, by the consent of their respective Boards
of
3
Directors,
or officers authorized by such Boards, may amend or modify this Agreement,
in
such manner as may be agreed upon, by a written instrument executed by Stratus
and Source One.
|
9.
|
Governing
Law
|
This
Agreement shall be governed by and construed in accordance with the laws
of the
State of New Jersey, without regard to conflicts of law principles.
|
10.
|
Section
Headings
|
The
section headings are for the convenience of the parties and in no way alter,
modify, amend, limit, or restrict the contractual obligations of the
parties.
|
11.
|
Severability
|
The
invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this
Agreement.
|
12.
|
Counterparts
|
This
Agreement may be executed in one or more counterparts, each of which shall
be
deemed an original but all of which, when taken together, shall be one and
the
same document.
STRATUS
SERVICES GROUP, INC.
By:
/s/
Xxxxxx X. Xxxxxxx
Xxxxxx
X.
Xxxxxxx
Chairman
and CEO
SOURCE
ONE PERSONNEL, INC.
By:
/s/
Xxxxx X. Xxxxxxx
Xxxxx
X.
Xxxxxxx
President
4
