Common use of Not to Compete Clause in Contracts

Not to Compete. For a period of two (2) years from and after the Closing Date, TFS or TFSI will not compete with the Continuing Business by engaging directly or indirectly in any business that TFSB conducted as of the Closing Date in any of the geographic area in which TFSB conducts that business as of the Closing Date, provided however, that that no owner of less than 20% of the outstanding stock of a publicly traded corporation shall be deemed to engage solely by reason thereof in any of its businesses For purposes of this Agreement, the phrase "compete with the Continuing Business," or the substantial equivalent thereof, means that the respective entity directly or indirectly owns, manages, operates, controls, or participates in the ownership, management, operation or control of, or works for or provides consulting services to, or permits the use of its name by, or lends money to, any business or activity which is or which becomes, at the time of the acts or conduct in question, engaged in the assembly of LCD modules less than seven inches on the diagonal ("Small LCDs"). For purposes of this definition, the purchase of completed Small LCDs to be further integrated into a larger subsystem or product shall not be deemed a competitive activity. If the final judgment of the court of competent jurisdiction declares that any term or provision of this Section 7(e) is invalid or unenforceable, the Parties agree that the court making the CONFIDENTIAL March 30, 2005 determination of invalidity or unenforceability shall have the power to reduce the scope, duration, or area of the term or provision, to delete specific words or phrases, or to replace any invalid or unenforceable term or provision with a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision, and this Agreement shall be enforceable as so modified after the expiration of the time within which the judgment may be appealed