Exhibit 10.4
NON-COMPETITION AGREEMENT
THIS NONCOMPETITION AGREEMENT (this
“Agreement” ), dated as of March 3, 2004,
is entered into by and among Ask Jeeves, Inc., a Delaware
corporation ( “Acquiror” ), and
, the undersigned individual stockholder (
“Holder” ) of Interactive Search Holdings, Inc.,
a Delaware corporation ( “Holder” ).
BACKGROUND
A. Acquiror,
Holder, Aqua Acquisition Corp., a Delaware corporation and wholly
owned subsidiary of Acquiror ( “Merger Sub” )
and Aqua Holdings LLC, a single member Delaware limited liability
company wholly owned by Acquiror (the “LLC”), have
entered into that certain Merger Agreement dated March 3, 2004
(the “Merger Agreement” ), pursuant to which
Indigo, Inc. ( “Target” ) merged substantially
all of its assets (the “Merger” ) with
Acquiror.
B. Holder
owns a substantial portion of the outstanding capital stock (the
“Stock” ) of Target, and as a result of the
Merger, Holder received an ownership interest in Acquiror
(capitalized terms used but not otherwise defined herein shall have
the meanings given such terms in the Merger Agreement).
C. Holder
previously served as the
of Target.
D. Holder
is a resident of the State of
and with primary
offices based in Irvington, New York.
E. Acquiror,
after giving effect to the Merger, is engaged in the business of
information retrieval and providing web wide search
.
F. After
giving effect to the Merger, Holder will be a key executive officer
of the Acquiror.
G. In
consideration for Holder receiving the consideration described in
Section 1.6 of the Merger Agreement, and to protect the
goodwill of the business purchased by Acquiror in connection with
the Merger Agreement, and as an inducement for Acquiror to enter
into the Merger Agreement and to merge all of the assets of Target,
Holder has agreed to enter into this Agreement.
AGREEMENT
In
consideration of the mutual representations, warranties and
covenants contained herein, and upon and subject to the terms and
the conditions hereinafter set forth, the parties do hereby agree
as follows:
1. Agreement Not to Compete . The parties acknowledge
that Holder has acquired significant knowledge and information
concerning the business of Target, which will be the business of
the Acquiror after giving effect to the Merger and that such
business is very
S-1
competitive. The parties
acknowledge that Target is presently doing business in each of the
various States within, and territories of, the United States and in
each of the countries as listed on Exhibit A hereto
(collectively, the “Covered Area” ). Competition
by Holder with the business of Acquiror after consummation of the
transactions contemplated by the Merger Agreement would severely
injure the business of the Acquiror and impair the goodwill being
purchased by Acquiror. Accordingly, Holder agrees that he shall
not, for a period of two (2) years from the date of the
Closing (the “Non-Compete Period” ), compete
with the business of Acquiror, by engaging, directly or indirectly,
in the Covered Business (as defined below) within the Covered Area.
In addition, Holder agrees that while an employee or consultant of
Acquiror, Holder shall not compete with any new business that is
outside the scope of the Covered Business engaged in by Acquiror or
any of its subsidiaries after the date hereof.
2. Definitions . For purposes of this Agreement, (i)
“ Covered Business ” means business that Target
is currently involved in during the one-year period preceding the
date of this Agreement, including but not limited to toolbar
distribution, on-line search, on-line advertising, portal services,
and on-line advertising representation (ii) the phrase
“engaging, directly or indirectly” means
engaging or having an interest in, directly or indirectly, as
owner, partner, participant of a joint venture, trustee,
proprietor, shareholder, member, manager, director, officer,
employee, independent contractor, capital investor, lender,
consultant, advisor or similar capacity, or by lending or allowing
his name or reputation to be used in connection with, or otherwise
participating in or allowing his skill, knowledge or experience to
be used in connection with, the operation, management or control of
a business or enterprise engaged in any aspect of the Covered
Business, and (iii) “within” the Covered Area
includes the sale, marketing or distribution to a person or entity
in or within, or for resale within, the Covered Area even if the
service is performed in another state, territory, jurisdiction or
country or the product sold or distributed is manufactured in or
sold or shipped from another place.
3. Non-Solicitation . Holder agrees not to directly or
indirectly, individually or as a consultant, employee, officer,
director, manager, stockholder, partner, member, owner, advisor or
participant in any business entity, solicit or endeavor to entice
away from Acquiror or any of its subsidiaries, parent, or holding
company (Acquiror and each such subsidiary, parent or holding
company are collectively referred to herein as the
“Related Companies” and each individually as a
“Related Acquiror” ), or ot
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