NON-DISCLOSURE, NON-COMPETITION,
NON-SOLICITATION AND
INVENTION
AGREEMENT
This
Non-Disclosure, Non-Competition, Non-Solicitation and Invention
Agreement ( "this Agreement" ) between Innovative
Software Technologies, Inc., a Delaware corporation (
“Innovative” ), The Web Channel Network, Inc., a
Florida corporation wholly-owned by Innovative ( “Web
Channel” ), and Robert W. Singerman (
"Employee" ) is hereby entered into as of June 17,
2009. (Innovative and Web Channel are collectively and
separately referred to herein as the
“Company.” )
RECITALS:
WHEREAS, as of the date of this Agreement, the Company
and its Affiliates (as defined in Section 1(h) hereof) are engaged
in the business of design, production, marketing, innovation,
licensing, merchandising, strategic direction and on-going
operations of internet protocol television
channels commonly referred to as WEB Channels, and
in the future they may engage in additional related and unrelated
businesses (all such activities collectively being referred to
herein as the "Business" );
WHEREAS, Employee will be employed by the Company, and
the Company is and will be in a confidential relationship with
Employee; and in the course of such employment with the Company,
Employee will become familiar with and aware of information as to
the Company’s products and technologies, specific manner of
doing business, customers and suppliers, contracting activities,
and future plans with respect thereto, all of which have been and
will be established and maintained at great expense to the Company
and its Affiliates; and virtually all of which constitute trade
secrets and valuable goodwill of the Company;
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WHEREAS, Employee recognizes that the Business of the
Company and its Affiliates depends upon the use of certain
confidential information, involving (a) trade secrets, and
(b) other information that is (i) of any value or
significance to the Company and its Affiliates, and (ii) not
generally known to competitors of the Company nor intended by the
Company for general dissemination, including (but not limited to)
any and all proprietary and technical information of the Company
involving its business operations, products, services, equipment,
inventions, referral sources, techniques and methods, know-how,
operating systems, associated procedures and systems, formulae,
technology, designs, drawings, engineering, computer software,
source codes, object codes, accounting and financial data, lists of
and data concerning current and potential vendors, suppliers and
customers, pricing and discounting practices, market data,
marketing and distribution methods and arrangements, marketing
materials, sales, costs, quality controls, risk management,
insurance, finances, capital structure, financial models,
projections, billings, profits, losses, business organization,
contracts, agreements, plans, sources of supply, special programs
relating to sales, project files, prospect reports, service,
training, and information about the Company itself and its
respective executives, managers, officers, directors, employees,
sales representatives, and offers to sell the Company or its assets
or to purchase or otherwise acquire other business entities or
their assets, and all related negotiations (collectively,
"Confidential Information" ) made available to Employee and
that the protection of the Confidential Information is of critical
importance to the Company and its Affiliates;
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WHEREAS, Employee has agreed to keep in confidence and
not use the Confidential Information for Employee’s
commercial benefit, and recognizes that the Company will sustain
great loss and damage if Employee should violate the provisions of
this Agreement and that monetary damages for such losses would be
extremely difficult to measure;
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WHEREAS, any obligation of Employee, as set forth in the
preceding paragraphs, shall apply to Confidential Information
disclosed in writing and designated or obviously recognizable as
being confidential, or if disclosed orally, any such information
that may be promptly reduced to writing; and
WHEREAS, Employee recognizes that the training of
Employee by the Company, Employee’s access to Confidential
Information, and other investments by the Company in the
development of Employee may be made by the Company in preparation
for a sale of substantially all of the assets of the Company or
some other transfer of the Company itself to an acquiring
entity;
NOW, THEREFORE, in consideration of Employee's employment and
continued employment with the Company, the aforesaid recitals which
are incorporated in and are a part of this Agreement, and the
mutual promises, terms, covenants and conditions set forth herein,
and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and
Employee hereby agree as follows:
1.
Non-Competition and
Non-Solicitation .
(a)
Employee agrees that he or she shall
not, during the term of Employee’s employment with the
Company and for a period of one (1) year following termination of
such employment (the “Noncompete Period” ),
alone or by combining or conspiring with others or in any other
manner whatsoever, within the counties and other geographic areas
of every state and territory of the United States in which the
Company has or had customers or any business premises, or otherwise
operated the Business:
(i)
directly or indirectly (as defined
in Section 1(i) on page 4 below), run, own, manage, operate,
control, be employed by, provide consulting services to, be a
manager of, participate in, lend Employee’s name to, invest
in or be connected in any manner with the management, ownership,
operation or control of any business, venture or activity that (x)
competes with the Business or any part thereof as conducted by the
Company, any Affiliate of the Company, or any purchaser of
substantially all of the assets of the Company in order to carry on
the Business (an “Acquiror”) during the term
hereof or at any time after the date hereof or (y) in any way
provides or may provide services similar to those provided by the
Company or any of its Affiliates or an Acquiror that constitute,
relate to, or concern the Business (however, Employee shall not be
considered to be in default of this Section 1 solely by virtue of
Employee’s holding for portfolio purposes, as a passive
investor, not more than one percent (1%) of the issued and
outstanding equity securities of a corporation, the equity
securities of which are listed or quoted on a national stock
exchange or a national over-the-counter market);
(ii)
directly or indirectly (as defined
in Section 1(i) on page 4 below), without the prior written consent
of the Company, solicit, recruit, offer employment, employ, engage
as a consultant, lure or entice away or in any other manner
persuade or attempt to persuade any person who is an employee or
consultant of the Company or any of its Affiliates, to leave the
employ of, or reduce Employee’s services to, the Company or
any of its Affiliates or an Acquiror, unless such person has been
terminated by the Company or any of its Affiliates;
(iii)
contact any past, present or
potential customer, vendor or contractor of the Company or any of
its Affiliates or an Acquiror, for the purpose of (1)
providing any service provided by the Company or any of its
Affiliates or an Acquiror or (2) inducing or attempting to
induce the entity to cease doing business with the Company or any
of its Affiliates or an Acquiror, or reduce the amount of business
previously done or contemplated to be done by the Company or any of
its Affiliates or an Acquiror, for such entity;
(iv)
contact any past, present or
potential vendor, supplier, contractor or other provider to the
Company or any of its Affiliates or an Acquiror, for the purpose of
obtaining any services or commodities if the effect thereof could
be expected to interfere with, disturb, interrupt or reduce the
amount or level of such services or commodities available to the
Company or any of its Affiliates or an Acquiror; or
(v)
contact any prospective acquisition
candidate, prospective Acquiror, or potential business partner of
the Company or any of its Affiliates, on Employee’s own
behalf or on behalf of any other person or entity, which
acquisition candidate, prospective Acquiror, or potential business
partner was either called upon by the Company or its Affiliates or
for which Employee or the Company or its Affiliates made an
acquisition analysis while Employee was employed by the
Company.
(b)
Employee recognizes and hereby
acknowledges that Employee’s breach of any of the covenants
contained in this Section 1 of this Agreement will cause
irreparable harm and damage to the Company or its Affiliates or an
Acquiror, the monetary amount of which may be virtually impossible
to ascertain. As a result, Employee recognizes and
hereby acknowledges that the Company and its Affiliates and an
Acquiror shall be entitled to an injunction from any court of
competent jurisdiction enjoining and restraining any violation of
any or all of the covenants contained in this Section 1 of this
Agreement by Employee or any of Employee’s Affiliates,
partners or agents, either directly or indirectly, and that such
right to injunction shall be cumulative and in addition to whatever
other remedies the Company and its Affiliates and an Acquiror may
possess at law or in equity (including, without limitation, damages
at law). This Section 1, subsection (b) shall survive
the termination of Employee’s employment or this Agreement
for any reason. The provisions of this Agreement shall
be enforceable in law and in equity notwithstanding the existence
of any claim or cause of action by Employee against the Company or
its Affiliates or an Acquiror, whether predicated on this Agreement
or otherwise.
(c)
The parties agree that the covenants
contained in this Section 1 impose a reasonable restraint on
Employee in light of the Business, and the activities and future
plans of the Company and its Affiliates. Employee
acknowledges that the restraints in such covenants are necessary to
protect the legitimate business interests of the Company,
including, but is not limited to, the extraordinary and specialized
training Employee received while employed by the Company and
Employee’s knowledge of (i) the Company’s trade
secrets and valuable confidential business information that
otherwise does not qualify as trade secrets, and (ii) the
Company’s substantial relationships with specific prospective
or existing customers, suppliers, or joint venturers.
(d)
The covenants in this Section 1 are
severable and separate, and the unenforceability of any specific
covenant shall not affect the provisions of any other
covenant. In the e
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