Exhibit 10.4
NONCOMPETE AND TERMINATION AGREEMENT
This Noncompete and
Termination
Agreement (the
"Agreement") is
dated and entered into as of January 1,
2005, between JOHN H. HARLAND COMPANY
(the "Company") and Timothy C. Tuff
("Employee").
In consideration of the mutual promises and agreements
contained
herein, as well as the promises and
agreements contained in the letter agreement
between the parties dated April 21, 2005
(to which this Agreement is attached as
an exhibit), the parties, intending to be
legally bound, hereby agree as
follows:
Section 1
.
Restrictive Covenants.
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1.1
Acknowledgment of
Access to Confidential
Matters. Employee and the
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Company recognize and acknowledge that as a result of
his employment with the
Company:
(a) Employee
has had access to, and will continue to have access to,
technology utilized by the Company and its subsidiaries
(collectively,
the "Company") in connection with their operations, which
technology is
unique to the Company, including production operating systems,
order
entry systems, quality control practices, decision support,
database
marketing and other technology developed by the Company for its
various
products and systems.
(b) Employee
will have access to and knowledge of all financial statements
and related data for the Company, including pricing, sales and
training
manuals, and other confidential materials utilized by the
Company;
complete and detailed knowledge of all the products of the Company
and
their capacities and specifications; and knowledge of all of
the
systems and procedures of the Company with regard to selling,
pricing,
and financing its products and services.
(c) Employee
will have specific knowledge regarding the Company's
customers, including their specific needs and current and
anticipated
requirements for the Company's products and services.
1.2 Potential Injury to Company. Employee
recognizes, acknowledges and agrees
that the Company's Confidential Information
and Trade Secrets (as defined
below), including those specified in
Section 1.1, constitute valuable, special
and unique assets of the Company and that
the improper use or disclosure thereof
would cause substantial loss of competitive
advantage and other injury to the
Company. Employee further agrees that the
training and experience gained while
employed by the Company and the knowledge
acquired during his employment with
the Company regarding the aforesaid
information would enable him to injure and
cause substantial harm to the Company if he
should compete with the Company in
its business before the expiration of a
reasonable time after termination of his
employment with the Company.
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1.3 Noncompetition. For the reasons recited
in Sections 1.1 and 1.2 above,
Employee covenants and agrees that, during
the term of his employment with the
Company and for a period of two (2) years
after the termination of such
employment, Employee will not, within the
continental United States, provide
services similar to the services he
provides to the Company as an officer,
executive, managerial employee, partner,
director or consultant to any entity or
person engaged in the Restricted Businesses
(as defined below). The agreements
of Employee contained herein shall not
prevent him from purchasing or owning an
investment of not more than 1% of the
outstanding capital stock of a publicly
held company engaged in the Restricted
Businesses, so long as his only
relationship with such company is as a
passive investor and he has no
responsibility for the management of the
company. For purposes of this
Agreement, the term "Restricted Businesses"
shall mean the printing, marketing
and selling of financial and business
documents, including checks, financial
documents and forms, magnetic ink character
recognition documents, and similar
printed business documents; the
development, marketing, and selling of database
marketing software, loan and deposit
origination and compliance software,
marketing customer information file
software, host processing software, and
mortgage software applications; and the
development, marketing, and selling of
information management products and
services, including optical mark reading
equipment, scannable forms, survey
solutions, and field maintenance services.
The covenants on the part of Employee contained in Sections 1.3
through
1.8 of this Agreement shall be construed as
agreements independent of each other
and of any other provisions of this
Agreement, and the existence of any claim or
cause of action Employee may have against
the Company, whether predicated on
this Agreement or otherwise, shall not
constitute a defense to the enforcement
by the Company of said covenants.
1.4 Nonsolicitation of Customers. Employee
covenants and agrees that he will
not, during the term of his employment with
the Company and for a period of two
(2) years thereafter, either directly or
indirectly, on Employee's own behalf or
in the service of or on behalf of others,
solicit, directly or indirectly, any
business related to the Restricted
Businesses from any of the Company's
customers, including actively sought
prospective customers, with whom Employee
had material contact during the last twelve
(12) months of Employee's employment
by the Company or about whom Employee
obtained Confidential Information or Trade
Secrets during the course of his employment
with the Company. "Material contact"
as that term is used herein exists if
interaction took place between Employee
and such person or entity in an effort to
further the business of the Company.
1.5 Nonsolicitation of Employees. Employee
covenants and agrees that he will
not, during the term of his employment with
the Company and for a period of two
(2) years thereafter, directly or
indirectly solicit, entice, encourage or
persuade any employee of the Company to
leave the services of the Company for
any reason.
1.6 Nondisclosure of Trade Secrets.
Employee covenants and agrees that he will
not, without the prior written consent of
the Company, during Employee's
employment with the Company and for so long
thereafter as the information or
data remain Trade Secrets, use or disclose,
or permit any unauthorized person to
use, disclose, or gain access to any Trade
Secrets of the Company. For purposes
of this Agreement, the term "Trade Secret"
means information including, but not
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limited to, any technical or nontechnical
data, formula, pattern, compilation,
program, device, method, technique,
drawing, process, financial data, financial
plan, product plan, list of actual or
potential customers or suppliers or other
information similar to any of the
foregoing, which (i) derives economic value,
actual or potential, from not being
generally known to, and not being readily
ascertainable by proper means by, other
persons who can derive economic value
from its disclosure or use and (ii) is the
subject of efforts that are
reasonable under the circumstances to
maintain its secrecy.
1.7 Nondisclosure of Confidential
Information. Employee covenants and agrees
that he will not, without the prior written
consent of the Company, during
Employee's employment with the Company and
for a period of two (2) years
thereafter, use or disclose, or permit any
unauthorized person to use, disclose
or gain access to, any Confidential
Information to which the Employee obtained
access by virtue of Employee's employment
with the Company. For purposes of this
Agreement, the term "Confidential
Information" means the whole or any portion or
phrase of any data or information, other
than Trade Secrets, that is material to
the Company and not generally known by the
public. To the fullest extent
consistent with the foregoing and otherwise
lawful, Confidential Information
shall include, without limitation, (i) the
Company's sales records, profit and
performance reports, pricing manuals, sales
manuals, training manuals, selling
and pricing procedures, and financing
methods; (ii) the identities of the
Company's customers, their special demands,
and their current and anticipated
requirements for the Company's products;
(iii) the capabilities and
specifications of the Company's products,
product development, product formulas,
functionality or application of products,
and the sources of supply for raw
materials used in production, packaging and
shipping; (iv) the Company's
business plans and financial statements and
projections; and (v) the special
products, programs and services the Company
may offer or provide from time to
time to its customers.
The parties acknowledge and agree that the restrictions stated
in
Sections 1.6 and 1.7 are in addition to and
not in lieu of protections afforded
to trade secrets and confidential
information under applicable state law.
Nothing in this Agreement is intended to or
shall be interpreted as diminishing
or otherwise limiting the Company's right
under applicable state law to protect
its trade secrets and confidential
information.
1.8 Materials. Employee agrees that all
files, memoranda, notes, records, price
lists, customer lists, drawings, manuals or
other documents, whether made or
compiled by Employee or furnished to
Employee from any source by virtue of
Employee's employment with the Company, are
the sole property of the Company.
Upon the request of the Company and, in any
event, within five business days of
the termination of Employee's employment
with the Company, Employee shall
deliver to the Company all such documents
and materials.
1.9 Company's
Ownership of Work Product.
(a) Work
Product. Employee
acknowledges
and agrees that the
Company
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shall own all of his Work Product. For purposes of this Agreement,
"Work Product" shall mean all intellectual property rights,
including all Trade Secrets, U.S. and international copyrights,
patentable inventions,
discoveries and
improvements, and other
intellectual property rights, in any programming, documentation,
technology or other work that
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relates to the business and interests of the Company
that Employee
conceives, develops or
delivers to the
Company at any time
during
the term of his
employment.
Work Product shall also include all
intellectual property rights in any programming, documentation,
technology or other work product that is contained in any of
the
products or systems,
including development
and support systems,
of the Company as of the date of this Agreement or at any time prior
to the date of this
Agreement while
Employee was engaged
as an
independent contractor
or as an employee of the Company. All
Work Product shall be
considered work made
for hire (as that term is
defined in the United
States Copyright
Act, 17 U.S.C., Section 101)
by Employee and owned by the Company. All work produced during
Employee's employment
with the Company
shall be the
Company's
property unless
otherwise agreed to in writing in advance by
the
Company.
(b) Assignment
of Work Product.
If any of the Work
Product may not, by
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operation of law, be considered work made for hire by Employee for
the Company or if
ownership of all right; title and interest of
the intellectual
property rights herein shall not otherwise vest
exclusively in the Company, Employee agrees to assign,
without
further consideration,
the ownership of all U.S. and
international
copyrights, patentable
inventions an
