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EXHIBIT 10.3
NONCOMPETITION AGREEMENT
THIS NONCOMPETITION AGREEMENT (this "Agreement") is entered into
as of the
26th day of April, 2005, by and between RMK HOLDINGS, LLC, a
Delaware limited
liability company ("RMK"), and RCG COMPANIES INCORPORATED, a
Delaware
corporation ("RCG").
Statement of Purpose
RMK, Logisoft Corp., a wholly-owned subsidiary of RCG
("Logisoft"), and
eStorefronts.net Corp., a wholly-owned subsidiary of Logisoft
(together with
Logisoft, "Sellers"), have entered into that certain Asset
Purchase Agreement,
dated April 26, 2005 (the "Asset Purchase Agreement"), pursuant
to which Sellers
are selling to RMK, or its affiliate, certain items of
inventory, intellectual
property, customer list, contracts, equipment and other assets
used in Sellers'
business, as presently conducted, which consists of reselling
computer software
and hardware, sales, design, hosting and maintenance of internet
and intranet
websites, information technology consulting and ecommerce
software development
and consulting (the "Business"). In order to protect the RMK's
legitimate
business interests, as a condition to and as further
consideration for RMK
entering into the Asset Purchase Agreement, RCG has agreed to
enter into this
Agreement.
NOW, THEREFORE, in consideration of the foregoing Statement of
Purpose and
the mutual promises contained herein, the parties hereto agree
as follows:
ARTICLE 1.
DEFINITIONS
Capitalized terms used herein shall have the meanings set forth
in Annex
A.
ARTICLE 2.
NON-DISCLOSURE COVENANT; EMPLOYEE INVENTIONS
2.1 Acknowledgments by the RCG. RCG acknowledges that (a) as a
result of
its ownership of Logisoft, RCG possesses Confidential
Information; (b) public
disclosure of such Confidential Information could have an
adverse effect on RMK
and its business; and (c) the provisions of this Article 2 are
reasonable and
necessary to prevent the improper use or disclosure of
Confidential Information.
2.2 Agreements of RCG. In consideration of the foregoing and the
Statement
of Purpose other good and valuable consideration, RCG covenants
as follows:
(a) Confidentiality.
(i) RCG shall hold in confidence all Confidential
Information
and shall not disclose Confidential Information to any Person or
use
Confidential Information in any way whatsoever, except as
otherwise expressly
permitted by the terms of this Agreement or as
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(ii) required by law. This Section 2.2(a)(i) shall not be
construed as preventing RCG from using its general skills,
knowledge and
expertise so long as RCG does so without using or disclosing
Confidential
Information.
(iii) Any trade secrets of RMK or the Business shall be
entitled to all of the protections and benefits under the North
Carolina Trade
Secrets Protection Act, N.C. Gen. Stat. ss. 66-152 et seq. and
any other
applicable law. If any information that RMK deems to be a trade
secret is found
by a court of competent jurisdiction not to be a trade secret
for purposes of
this Agreement, such information may, nevertheless, be
considered Confidential
Information for purposes of this Agreement. RCG hereby waives
any requirement
that RMK submit proof of the economic value of any trade secret
or post a bond
or other security.
(iv) None of the foregoing obligations and restrictions
applies to any part of Confidential Information that is or
becomes generally
available to the public other than as a result of a disclosure
or use by RCG or
unlawful use or disclosure by some other Person or that is
required to be
disclosed by RCG by law or by a court of competent
jurisdiction.
2.3 Disputes or Controversies. RCG recognizes that should a
dispute or
controversy arising from or relating to this Agreement be
submitted for
adjudication to any court, arbitration panel or other third
party, the
preservation of the secrecy of Confidential Information may be
jeopardized. All
pleadings, documents, testimony and records relating to any such
adjudication
shall be maintained in secrecy and shall be available for
inspection by RMK,
RCG, and their respective attorneys and experts, who shall
agree, in advance and
in writing, to receive and maintain all such information in
secrecy, except as
may be limited by them in writing.
ARTICLE 3.
NON-COMPETITION AND NON-INTERFERENCE
3.1 Acknowledgments by RCG. RCG acknowledges that (a) it has
great
familiarity with and expertise relating to the Business, having
owned Logisoft
for many years, (b) upon the closing of the transactions
contemplated by the
Asset Purchase Agreement, RMK and the Business will compete with
other
businesses that are or could be located in any part of the
states of (1) New
York, (2) New Jersey, (3) Connecticut, (4) Pennsylvania, (5)
Massachusetts, (6)
Vermont (7) Maryland or (8) North Carolina (the "Restricted
Area"), and (c) the
provisions of this Article 3 are reasonable and necessary to
protect RMK's
legitimate business interests.
3.2 Covenants of RCG. In consideration of the acknowledgments by
RCG, the
Statement of Purpose and the terms and conditions of the Asset
Purchase
Agreement, RCG covenants that it will not, directly or
indirectly:
(a) at any time during the Restricted Period, engage or invest
in,
own, manage, operate, finance, control or participate in the
ownership,
management, operation, financing or control of, be employed by,
lend RCG's name
or any similar name to, lend RCG's credit to, render services or
advice to, any
business or Person whose products, services or activities
compete in whole or in
part with the products produced or activities conducted by RMK
or any of its
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affiliates with respect to the Business (each a "Competitor"),
in each case in
the Restricted Area; provided, however, that RCG may purchase or
otherwise
acquire up to (but not more than) 5% of any class of securities
of any
enterprise (but without otherwise participating in the
activities of such
enterprise) if such securities are listed on any national or
regional securities
exchange or have been registered under Section 12(g) of the
Securities Exchange
Act of 1934;
(b) at any time during the Restricted Period, solicit business
of
the same or similar type being carried on by RMK solely with
respect to the
Business from any Person known by RCG to be a customer of RMK
with respect to
the Business within the Restricted Area;
(c) whether for RCG's own account or the account of any other
Person
(i) at any time during the Restricted Period, solicit, employ or
otherwise
engage as an employee, independent contractor or otherwise, any
Person who is or
was an employee of RMK during the six-month period prior to
engagement by RCG or
in any manner induce or attempt to induce any employee of RMK to
terminate his
employment with RMK; or (ii) at any time during the Restricted
Period, knowingly
interfere with RMK's relationship with any Person, including any
Person who is
or was an employee, contractor, supplier or customer of RMK with
respect to the
Business, in each case in the Restricted Area; or
(d) at any time during the Restricted Period, disparage RMK or
any
of its members, managers, officers, employees or agents.
(e) Nothing contained in this Article 3 shall be construed
to
prevent RCG from maintaining or hosting internet or intranet
websites relating
to the sales of travel or leisure services if such activities do
not otherwise
violate the terms of this Agreement.
(f) For purposes of this Section 3.2, the term "Restricted
Period"
means the period beginning on
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