EXHIBIT 10.3
NON-COMPETITION
AGREEMENT
THIS NON-COMPETITION AGREEMENT (this
“Agreement”) is made as of this
day of
,
2009 (the “Effective Date”) by and among BOSTWICK
LABORATORIES, INC. (“Purchaser”) and COMMONWEALTH
BIOTECHNOLOGIES, INC. (“Seller”).
W I T N E S S E T H
:
Concurrently with the execution and
delivery of this Agreement, pursuant to the terms and conditions of
an Asset Purchase Agreement dated
(the “Asset Purchase Agreement”), the Purchaser is
purchasing from Seller certain assets of the Seller used in the
operation by Seller of the business of providing research and
development and support services, including laboratory support
related to (i) molecular biology; (ii) protein expression
and analysis and peptide synthesis and purification;
(iii) bio-analytical services; (iv) assay development and
validation; and (v) microbiology, virology and biosafety
testing, on a fee-for-service basis to governmental agencies, the
biotechnology and pharmaceutical industry and other entities, in
all cases providing such services through CBI Services and Fairfax
Identity Laboratories (FIL) at Richmond, Virginia (the operations
of CBI Services and Fairfax Identity Laboratories referred to
collectively herein as the “Business”).
Section 7.1.4 of Asset Purchase
Agreement requires that non-competition agreements contained herein
be executed and delivered by the Seller as a condition to the
purchase of the Assets by the Purchaser.
Unless otherwise defined herein,
capitalized terms used in this Agreement shall have the meanings
ascribed to them in the Asset Purchase Agreement.
NOW THEREFORE, in consideration of
the payment to the Seller, pursuant to the Asset Purchase
Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:
1. Non-Compete
. The Seller and the Purchaser
acknowledge and agree that the goodwill value of the Seller
comprises an essential portion of the consideration received by the
Purchaser under the Asset Purchase Agreement for which the
Purchaser is paying the Purchase Price and the Purchaser would not
enter into the Asset Purchase Agreement or purchase the Assets from
the Seller without the Seller’s agreement to the provisions
of this Agreement. Accordingly, the Seller covenants as
follows:
(a) For a period of three
(3) years after the Effective Date (the “Non-Competition
Period”), the Seller will not, directly or indirectly,
compete with the Purchaser by locating any business in the
Commonwealth of Virginia that would engage, in activities in a
competitive capacity that compete with the Purchaser’s
operation of the Business. In addition, during the Non-Competition
Period Seller shall not solicit the existing customers of the
Business identified on Schedule 2.1.3(a) to the Asset Purchase
Agreement.
(b) The Purchaser agrees that
competition for purposes of Section 1(a) above shall include
only engaging in competitive activity either as a manager, owner or
operator and that this Agreement shall not prohibit the following
activities irrespective of the geographic location of such
activities: (i) any activities of (a) Mimotopes Pty Ltd,
(b) Venturepharm Laboratories Limited or (c) any other
entity that is or may become affiliated or associated with the
Seller through merger, consolidation, asset purchase or other
acquistion (such other entity together with Mimotopes Pty Ltd and
Venturepharm Laboratories are hereinafter collectively referred to
as the “Excluded Entities”), including the activites of
the Seller or its employees acting on or behalf of the Excluded
Entities, provided that during the Non-Competition Period the
Excluded Entities shall not solicit the existing customers of the
Business identified on Schedule 2.1.3(a) to the Asset Purchase
Agreement; or (ii) the Seller’s engaging regulatory
consulting services in the area of pharmaceuticals,
bio-pharmaceuticals, diagnostics and/or medical devices.
(c) If any provision of this
Section 1 relating to the time period, geographic area or
scope of activities shall be declared by a court of competent
jurisdiction to exceed the maximum time period, geographic area or
scope of activities, as applicable, said time period, geographic
area or scope shall be deemed to be, and thereafter shall become,
the maximum time
