EXHIBIT 2.4
NONCOMPETITION AND CONFIDENTIALITY AGREEMENT
THIS AGREEMENT
is made as of October 13, 2005, between LARS FUHRKEN-BATISTA
("Batista"), a principal securityholder of Cinemaware, Inc., a California
corporation ("Cinemaware"), and eGAMES, INC., a Pennsylvania corporation
("eGames").
W I T N E S S E T H :
WHEREAS, contemporaneously with the execution and delivery
hereof,
eGames is acquiring the goodwill and
substantially all of the assets used or
useful by Cinemaware in designing,
developing, acquiring, promoting,
distributing, and/or selling interactive
entertainment software for various game
platforms and the Internet (the
"Business"), pursuant to an Asset Purchase
Agreement, dated as of October 6, 2005, to
which eGames, Batista and Cinemaware
are parties (the "Purchase Agreement");
and
WHEREAS, by virtue of the purchase of the Business, eGames is and
will
be engaged throughout the Area in the
Business which was formerly conducted by
Cinemaware; and
WHEREAS, Batista is a principal record and beneficial owner of
the
outstanding securities of Cinemaware:
and
WHEREAS, in consideration of the execution of the Purchase
Agreement by
eGames, Batista (in his capacity as a
principal securityholder) has agreed not
to compete with the Business as conducted
by eGames and to certain other
obligations, as set forth herein; and
WHEREAS, competition by Batista with eGames, or disclosure by
Batista
of certain confidential and proprietary
information of Cinemaware, will result
directly in damage to eGames and its
business, properties, assets, and goodwill
and will cause the loss by eGames of the
benefit of its bargain with Cinemaware;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and for other good and valuable
consideration, the receipt and
sufficiency of which are hereby
acknowledged, the parties, intending to be
legally bound hereby, agree as follows:
1. Definitions. The following terms shall have the definitions
set
forth below:
(a) "Affiliate" of a person shall mean any Person that
directly or indirectly controls, is
controlled by, or is under common control
with, the indicated Person.
(b) "Area" shall mean anywhere within any state of the United
States of America or any other country in
which eGames, Cinemaware or its
Affiliates, directly or indirectly, at any
time during the three-year period
ending on the date hereof carried on or
engaged in business or otherwise
designed, developed, manufactured,
provided, sold, licensed or distributed its
products, services or solutions.
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(c)
"Closing Date" shall mean the date of this Agreement.
(d) "Confidential Information" shall mean all of the following
materials and information (whether or not
reduced to writing and whether or not
patentable) pertaining to the Business:
(1) All items of information relating to the Business
that could be classified as a trade secret
pursuant to law;
(2) The names and addresses of the customers of the
Business and the nature and amount of
business done with such customers;
(3) The names and addresses of employees, with
respect to the Business;
(4) The discoveries, concepts and ideas, whether
patentable or not, related to the nature
and results of research and development
activities, processes and techniques
related to research and development,
designs, drawings and specifications of
Cinemaware relating to the Business;
(5) Source and object codes, flow charts, algorithms,
coding sheets, design concept and related
documentation and manuals of
Cinemaware which relate to the
Business;
(6) Production processes, marketing techniques,
purchasing information, price lists,
pricing policies, quoting procedures,
financial information, customer names and
requirements, customer data and other
materials or information relating to
Cinemaware's manner of doing business with
respect to the Business;
(7) Any other materials or information related to the
Business which are not generally known to
others engaged in similar business
activities.
eGames' or Batista's failure to make and keep any of the
foregoing
confidential shall not affect its status as
part of the Confidential Information
under the terms of this Agreement.
(e) "Prohibited Business" shall mean any and all designing,
developing, acquiring, promoting,
distributing, and/or selling of interactive
entertainment software for various game
platforms and the Internet that is based
upon or derived from the Intellectual
Property and any ideas, concepts, product
lines, trade secrets or Confidential
Information developed, created or under
consideration for approval by eGames or
Batista while Batista is employed by
eGames.
Capitalized terms used but not otherwise defined herein shall have
the
respective meanings given to them in the
Purchase Agreement.
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2. As an inducement and in consideration for eGames to enter into
the
Purchase Agreement, Batista covenants that
he shall, for a period of two (2)
years from and after the Closing