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NONCOMPETITION AGREEMENT

NonCompetition Agreement

NONCOMPETITION AGREEMENT | Document Parties: INTERNAP NETWORK SERVICES CORP | VitalStream Holdings, Inc You are currently viewing:
This NonCompetition Agreement involves

INTERNAP NETWORK SERVICES CORP | VitalStream Holdings, Inc

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Title: NONCOMPETITION AGREEMENT
Governing Law: California     Date: 11/29/2006
Industry: Communications Services     Sector: Services

NONCOMPETITION AGREEMENT, Parties: internap network services corp , vitalstream holdings  inc
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Exhibit 10.5

NONCOMPETITION AGREEMENT

     THIS NONCOMPETITION AGREEMENT (this “Agreement”) made as of this 12th day of October, 2006, by and between Internap Network Services Corporation, a Delaware corporation (“Internap”) and (“Principal”), an officer of VitalStream Holdings, Inc., a Nevada corporation (the “Company”). Internap and Principal are referred to collectively herein as the “Parties.”

RECITALS:

     WHEREAS, Internap, Ivy Acquisition Corp., a wholly owned subsidiary of Internap, and the Company desire to enter into that certain Agreement and Plan of Merger dated on or about October 12, 2006 (the “Merger Agreement”), pursuant to which Internap Acquisition Corp. shall be merged with and into the Company, with the Company becoming a wholly owned subsidiary of Internap (the “Merger”);

     WHEREAS, Principal is an equity holder and/or option holder of the Company, has served as an officer of the Company and has gained substantial knowledge and expertise in connection with the Company’s products, services, organization, customers, partners and other proprietary matters related to the Company’s business;

     WHEREAS, Principal will receive securities of Internap pursuant to the terms of the Merger;

     WHEREAS, this Agreement shall become effective only upon the consummation of the Merger; and

     WHEREAS, it is a material condition to Internap’s execution and delivery of the Merger Agreement and its willingness to complete the Merger and issue the Merger Consideration that Principal shall enter into this Agreement, which shall become effective upon the closing of the Merger.

AGREEMENTS:

     In consideration of the Merger, which will inure to the benefit of the Principal, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties hereto do hereby agree as follows:

      1.  Covenant Not to Compete.

          1.1 Restriction . During the Restricted Period, Principal covenants and agrees that he shall not, directly or indirectly, engage within the Territory in any activity, business or venture or division of any entity, whose primary business is the development, distribution, sale or provision of products that compete with the Business.

          1.2 Definitions .

               (a) For purposes of Section 1.1, the term “compete” means: (i) calling on, soliciting, taking away, accepting as a client or customer or attempting to call on, solicit, take away

 


 

or accept as a client or customer any individual, partnership, corporation or association that was a client or customer of the Company during the twelve (12)-calendar month period immediately preceding any such act with respect to business that is substantially similar to the Business; or (ii) entering into or attempting to enter into any business substantially similar to or competing in any way with the Business, either alone or with any individual partnership, corporation or association.

               (b) For purposes of Section 1.1, “Territory” means the United States of America.

               (c) For purposes of Section 1.1, “Restricted Period” means the period beginning on the Closing Date (as defined in the Merger Agreement) and ending on the third anniversary of the Closing Date.

               (d) For purposes of Section 1.1, “Business” means the business of providing content delivery services for the streaming of digital media over the Internet.

               (e) For purposes of Section 1.1, “Proprietary Information” means information related to any of Company’s past, present or identified prospective clients or customers (i) which derives economic value, actual or potential, from not being generally known to or readily ascertainable by other persons who can obtain economic value from its disclosure or use; and (ii) which is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. Proprietary Information also included information that has been disclosed to the Company or its affiliates by any of the Company’s past, present or identified prospective clients or customers that the Company or its affiliates have agreed to treat as confidential and that Principal knows or should reasonably know is considered confidential by such client or customer. “Proprietary Information” shall not include any information that (i) was lawfully in Principal’s possession or was lawfully known to Principal before receipt from any person or entity during the course and scope of his employment, (ii) is or becomes public knowledge without fault of Principal, (iii) is or becomes lawfully av


 
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