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NON-COMPETITION AGREEMENT

NonCompetition Agreement

NON-COMPETITION AGREEMENT | Document Parties: HARRIS STRATEX NETWORKS, INC. | STRATEX NETWORKS, INC You are currently viewing:
This NonCompetition Agreement involves

HARRIS STRATEX NETWORKS, INC. | STRATEX NETWORKS, INC

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Title: NON-COMPETITION AGREEMENT
Governing Law: Delaware     Date: 1/2/2007
Industry: Communications Equipment     Law Firm: Sullivan & Cromwell LLP;Bingham McCutchen LLP     Sector: Technology

NON-COMPETITION AGREEMENT, Parties: harris stratex networks  inc. , stratex networks  inc
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EXHIBIT 10.2

 

 

NON-COMPETITION AGREEMENT

Among

HARRIS CORPORATION,

STRATEX NETWORKS, INC.

and

HARRIS STRATEX NETWORKS, INC.

Dated: January 26, 2007

 

 

F-1


 

NON-COMPETITION AGREEMENT

      NON-COMPETITION AGREEMENT, dated as of January 26, 2007 (this “ Agreement ”), among HARRIS CORPORATION, a Delaware corporation (“ Harris ”), STRATEX NETWORKS, INC., a Delaware corporation (“ Stratex ”), and HARRIS STRATEX NETWORKS, INC., a Delaware corporation (the “ Company ”).

      WHEREAS, Harris, Stratex, the Company and Stratex Merger Corp., a Delaware corporation and wholly owned subsidiary of the Company have entered into an Amended and Restated Formation, Contribution and Merger Agreement, dated as of December 18, 2006, as amended by that certain letter agreement, dated January 26, 2007 (the “ Formation Agreement ”), among the parties thereto pursuant to which the Company was formed to acquire Stratex pursuant to the Merger and to receive the Contributed Assets from Harris in the Contribution Transaction, in each case on the terms and subject to the conditions set forth in the Formation Agreement;

      WHEREAS, because of the importance of preserving the value of the business being contributed by Harris as a going concern, Stratex was not willing to enter into the Formation Agreement without the undertakings of Harris contained in this Agreement; and

      WHEREAS, the execution and delivery of this Agreement is a condition to closing under the Formation Agreement.

      NOW, THEREFORE, in consideration of the foregoing and the mutual covenants in the Agreements, the parties agree as follows:

      1.  Definitions. The term “ Restricted Business ” means the development, manufacture, distribution and sale of any microwave radio systems and related components, systems and services which are (i) competitive with the products listed in Schedule 1 hereto, or (ii) which are substantially similar to such products in form, fit and function when used in terrestrial microwave point-to-point communications networks that provide access and trunking of voice and data for telecommunications networks anywhere in the world. In addition, all capitalized terms used but not defined in this Agreement shall have the meanings assigned to them in the Formation Agreement; provided, however , that notwithstanding the foregoing neither the Company nor any of its Subsidiaries shall be deemed to be a Subsidiary or Affiliate of Harris or any of its other Subsidiaries or Affiliates for purposes of this Agreement.

      2.  Non-Competition. In consideration for the issuance to Harris of shares of the Company pursuant to the Formation Agreement and the performance by Stratex of its obligations under the Agreements (collectively, the “ Non-Compete Consideration ”), Harris agrees that, during the period commencing on the date of this Agreement and ending on the fifth anniversary of the date hereof, Harris will not, and will not permit any of its Subsidiaries to (a) engage, directly or indirectly, in the Restricted Business, (b) form any Person other than the Company and its Subsidiaries (a “ Covered Person ”) or change or extend the current business activities of any existing Covered Person for the purpose of engaging, directly or indirectly, in the Restricted Business or (c) invest, directly or indirectly, in any Covered Person engaged, directly or indirectly, in the Restricted Business in any material respect; provided, however , that notwithstanding the foregoing Harris and/or its Subsidiaries may (i) collectively own less than 20% of the total equity interests in any Covered Person engaged in the Restricted Business as long as none of the employees of Harris or any of its Subsidiaries is involved in the management of such Covered Person, (ii) participate as a passive investor with no management rights in any investment fund that holds an ownership interests in Covered Persons engaged in the Restricted Business which is managed by Persons that are not Affiliates of Harris (each, an “ Unaffiliated Person ”) (x) with any employee benefit or retirement plan funds and (y) with any other funds subject, in the case of this clause (y) only, to a maximum interest in such investment fund of 15% and (iii) acquire a Covered Person or business unit of a Covered Person engaged in the Restricted Business if (x) the Restricted Business contributed less than 20% of such Covered Person’s or business unit’s, as applicable, total revenues (based on its latest annual audited financial statements, if available) and (y) such Covered Person or Harris, as applicable, divests or ceases to conduct the Restricted Business within 18 months after the acquisition date. Notwithstanding anything in this Agreement to the contrary, the defined term “Restricted Business” shall not include, and the prohibition contained in this Section 2 shall in no way prohibit Harris and/or its Subsidiaries from,

F-2


 

(a) purchasing and reselling products produced by, and marked with the brands of, an Unaffiliated Person in connection with the sale, service, design or maintenance of a system that contains or uses microwave radios or related components, systems or services or (b) developing, manufacturing, distributing or selling microwave radios or related components, systems or services for use by Government Entities.

      3.  Sufficiency of Consideration. Each of the parties acknowledges that the Non-Compete Consideration is sufficient consideration for the duration and scope of the non-competition agreement contained herein and that such duration and scope are reasonable in all respects.

      4.  Severability; Enforceability. If any provision of this Agreement, or any part thereof, is held by a court or other authority of competent jurisdiction to be invalid or unenforceable, the parties agree that the court or authority making such determination will have the power to reduce the duration or scope of such provision or to delete specific words or phrases as necessary (but only to the minimum extent


 
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