Exhibit 10.3
RESTRICTIVE COVENANT
AGREEMENT
This Restrictive Covenant Agreement
(this “ Agreement ”) is made and entered into as
of [DATE], by and between Information Services Group, Inc.
(“ ISG ”) and [NAME] (the “ Restricted
Person ”).
RECITALS:
WHEREAS, the Restricted Person
acknowledges that ISG and its Affiliates (as defined below)
(collectively, the “ Company ”) is engaged in a
continuous program of research, design, development, production,
marketing and servicing with respect to its businesses and the
services it provides to its clients; and
WHEREAS, the Restricted Person
further acknowledges that: (i) the protections set forth in
this Agreement constitute an essential premise of the willingness
of ISG to grant the Restricted Person shares of common stock of ISG
(the “ Equity Awards ”), and (ii) it is
essential to the success of the Company that the Restricted Person
enter into the protections set forth herein and the holders of
common stock of ISG and the business of the Company would suffer
significant and irreparable harm by the Restricted Person competing
with the business of the Company for a period of time after any
termination of employment of the Restricted Person; and
WHEREAS, the Restricted Person
agrees that the restrictions set forth herein are reasonable and
necessary in order to protect the goodwill, confidential
information and other legitimate business interests of the Company
and its Affiliates.
NOW, THEREFORE, in consideration of
all of the foregoing, and the mutual terms, covenants, agreements
and conditions hereinafter set forth, the Company and the
Restricted Person hereby agree as follows:
1.
Definitions
. The
following terms shall have the following meanings:
“
Affiliate ” means (a) each Person directly or
indirectly controlling, controlled by or under direct or indirect
common control with ISG, and (b) each other Person of which
the Company is a direct or indirect beneficial holder of at least
10% of any class of the Equity Interests; provided , that,
for purposes of Sections 4 and 5 and the definition
of “Competition” herein only, the definition of
“Affiliate” shall, at any date of determination
thereof, include only such Affiliates that also: (i) conduct,
operate, carry out, engage in or are involved in, (ii) have
conducted, operated, carried out, engaged in or been involved in at
any time during the 24 months prior to such date of determination,
or (iii) are, or at any time during the 12 months prior to
such date of determination have been, actively considering becoming
involved in a practice area, line of business or other business
endeavor that is substantially similar to any practice area, line
of business or other business endeavor of the Company.
“ Cause ” shall
mean “Cause” as such term may be defined in any
employment agreement or other severance agreement in effect at the
time of termination of employment between the Participant and ISG
or any of its subsidiaries, or, if there is no such employment or
severance agreement, “Cause” shall mean, with respect
to a Participant: (a) willful and continued failure to perform
his or her material duties with respect to ISG or its subsidiaries
which continues beyond ten business days after a written demand for
substantial performance is delivered to the Participant by ISG or
any of its subsidiaries; (b) any act involving fraud or
material dishonesty in connection with the business of ISG or its
subsidiaries; (c) a material violation of the Company’s
code of conduct or other policy; (d) assault or other unlawful
act of violence; or (e) conviction of, or a plea of nolo
contendere to, any felony whatsoever or any misdemeanor that
would preclude employment under the Company’s hiring
policy.
“ Competition ”
shall mean when a Person (including, without limitation, the
Restricted Person) engages (alone or in concert with any other
Person) in, or provides assistance to any Person or entity that
engages in, any of the following activities:
(i)
conducts,
operates, carries out or engages in the business of advising and/or
facilitating third parties with respect to the sourcing of business
processes or technology processes, functions and assets;
or
(ii)
conducts,
operates, carries out, engages in or is involved in any established
practice areas which ISG or any of its Affiliates conducts,
operates, carries out, engages in or is involved in during the
Restricted Period, in any geographic area in which such business
may be conducted by ISG or any of its Affiliates.
“ Compete ” and
“ Competitor ” shall have correlative
meanings.
“ Confidential
Information ” means any and all information of the
Company that is not generally known by others with whom they
Compete or do business, or with whom any of them plans to Compete
or do business and any and all information, that is not publicly
known, which if disclosed, would assist in Competition with ISG or
any of its Affiliates. Confidential Information includes
without limitation any information relating to (i) the
development, research, testing, marketing and financial activities
of ISG and each of its Affiliates, (ii) the products and
services of ISG and each of its Affiliates, (iii) the costs,
sources of supply, financial performance and strategic plans of ISG
and each of its Affiliates, (iv) the identity and special
needs of the customers and clients of ISG and each of its
Affiliates, and (v) the people and organizations with whom ISG
and each of its Affiliates have business relationships and any
non-public details of those relationships. Confidential Information
also includes any information that the Company or any of its
Affiliates have received, or may receive hereafter, belonging to
customers or clients or others with any understanding, express or
implied, that the information would not be disclosed.
Notwithstanding the foregoing, Confidential Information does not
include any information generally available to, or known by, the
public (other than as a result of disclosure in violation of this
Agreement or any other non-disclosure obligation).
“ Contractual
Obligation ” means, with respect to any Person, any
contract, deed, mortgage, lease, license, commitment or other
agreement or understanding, whether written or oral, or other
document or instrument to which or by which such Person is a party
or otherwise subject to bound or to which or by which any property
or right of such Person is subject or bound.
“ Equity Interests
” means (a) any capital stock share partnership or
membership interest, unit of participation or other similar
interest (however designated) in any Person and (b) any
option, warrant, purchase right, conversion right, exchange rights
or other Contractual Obligation which would entitle any Person to
acquire any such interest in such Person or otherwise entitle any
Person to share in the equity, profit, earnings, losses or gains of
such Person (including stock appreciation, phantom stock, profit
participation or other similar rights.
“ Governmental Order
” means any order, writ judgment, injunction, decree,
stipulation, ruling, determination or award entered by or with any
Governmental Authority.
“ Governmental
Authority ” means any United States federal, state or
local or any foreign government or political subdivision thereof,
or any authority, agency or commission entitled to exercise any
administrative, executive, judicial, legislative, regulatory or
taxing authority or power of any court or tribunal (or any
department, bureau or division thereof), or any arbitrator or
arbitral body.
2
“ Legal Requirement
” means any United States federal, state or local or foreign
law, statute, standard, ordinance, code, rule, or regulation, or
any Governmental Order or any similar provision having the force or
effect of law.
“ Person ” shall
mean any “person” or “group” within the
meaning of Section 13(d) or 14(d) of the Securities
Exchange Act of 1934, as amended.
“ Restricted Period
” shall mean the period beginning on the date hereof and
ending on the second anniversary of any termination of employment
of the Restricted Person.
2.
Protection of
Confidential Information .
(a)
The Restricted
Person acknowledges that the success of ISG and each of its
Affiliates depends on the continued preservation of Confidential
Information possessed by the Restricted Person.
(b)
The Restricted
Person hereby agrees that he or she will not at any time on or
after the date of this Agreement, directly or indirectly, without
the prior written consent of the Company or its Affiliates, as
applicable, disclose or use, any Confidential Information involving
or relating to ISG or any of its Affiliates or their respective
businesses, except as may be reasonably required in the performance
of his or her duties and responsibilities, of ISG and each of its
Affiliates (as applicable).
(c)
Notwithstanding
the foregoing, the provisions of this Section 3 will
not prohibit the Restricted Person’s retention of copies of
personal records relating specifically to his or her employment
with ISG or any of its Affiliates (applicable), including
information regarding his or her compensation and benefits, nor
shall the foregoing prohibit disclosure (i) pursuant to any
applicable Legal Requirement so long as reasonable prior notice is
given of such disclosure and a reasonable opportunity is
af
