NON-COMPETITION AND NONDISCLOSURE AGREEMENT
Exhibit
10.2
This
Non-Competition and Nondisclosure Agreement is entered into as of April 30,
2007
(the “Agreement
Date”)
among
Accurel Systems International Corporation, a California corporation (the
“Seller”),
Implant Sciences Corporation, a Massachusetts corporation (the “Guarantor”)
and
▇▇▇▇▇ Analytical Group LLC, a Delaware limited liability company (the
“Buyer”).
WITNESSETH:
WHEREAS,
the Buyer, Seller and Guarantor have entered into an Asset Purchase Agreement,
dated as of the Agreement Date, pursuant to which, among other things, the
Buyer
is acquiring substantially all of the assets of Seller (the “Purchase
Agreement”);
WHEREAS,
in order to protect the value of the business of the Seller being acquired
by
the Buyer pursuant to the Purchase Agreement (the “Purchased
Business”),
Seller and Guarantor shall not compete with the Buyer and its respective
Affiliates (as defined in the Purchase Agreement) in accordance with the terms
and conditions hereof; and
WHEREAS,
the agreement of Seller and Guarantor not to compete with the Buyer and its
Affiliates as provided herein is an integral part of the transactions
contemplated by the Purchase Agreement, and without such agreements, Buyer
would
not have entered into the Purchase Agreement.
NOW,
THEREFORE, in consideration of the covenants and agreements contained herein,
the payment of the purchase price under the Purchase Agreement and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending to be legally bound hereby, agree
as
follows:
1.
Certain Definitions.
Capitalized terms used herein and not otherwise defined shall have the meanings
ascribed to them in the Purchase Agreement; provided, however, that the
following terms shall have the meanings set forth below irrespective of the
meanings such terms may have in the Purchase Agreement:
(a)
"Confidential
Information"
means
all information heretofore developed or used by the Seller or any of its
Affiliates relating to the Restricted Business (as defined below) operations,
employees, customers and clients of the Seller, including, but not limited
to,
customer and client lists, customer or client orders, financial data, pricing
information and price lists, business plans and market strategies and
arrangements, all books, records, manuals, advertising materials, catalogues,
correspondence, mailing lists, production data, sales materials and records,
purchasing materials and records, personnel records, quality control records
and
procedures included in or relating to the Restricted Business or any of the
assets of the Seller, and all trademarks, copyrights and patents and
applications therefor, all trade secrets, inventions, processes, procedures,
research records, market surveys and marketing know-how and other technical
papers. The term "Confidential Information" also includes any other information
heretofore or hereafter acquired by the Seller and deemed by it to be
confidential.
(b)
The
term "control",
with
respect to any person, means the power to direct the management and policies
of
such person, directly or indirectly, by or through stock ownership, agency
or
otherwise, or pursuant to or in connection with an agreement, arrangement or
understanding (written or oral) with one or more other persons by or through
stock ownership, agency or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
(c)
The
term "person"
means
an individual, corporation, partnership, joint venture, limited liability
company, association, trust, unincorporated organization or other entity,
including a government or political subdivision or an agency or instrumentality
thereof.
(d)
"Restricted
Business"
means
the Business of the Seller, including all services performed by or on behalf
of
the Seller for its customers.
(e)
"Restricted
Period"
means
the period commencing on the date of this Agreement and ending on the date
which
is five (5) years from the date hereof.
2.
Non-competition.
At all
times from and after the date of this Agreement and until the expiration of
the
Restricted Period, Seller and Guarantor shall not:
(a)
directly or indirectly engage in, be employed by, own, manage, operate, provide
financing to, control or participate in the ownership, management or control
of,
or otherwise have an interest (whether, subject to Section 5, as a stockholder,
director, officer, employee, representative, subcontractor, partner, consultant,
proprietor, agent or otherwise) in, or cause, authorize, aid or assist any
other
person to own, manage, operate, provide financing to, control or otherwise
have
an interest in, any business or any person who is engaged in any business that
directly or indirectly competes or intends to compete with the Restricted
Business anywhere in the world, unless Seller or Guarantor purchase or own
less
than five percent (5%) of capital stock in a publicly held company;
or
(b)
directly, indirectly or otherwise by letters, circulars or advertisements,
and
whether for itself or on behalf of any other person, canvass or solicit or,
directly or indirectly, cause or authorize to be solicited, or enter into or
effect, or, directly or indirectly, cause or authorize to be entered into or
effected, any business or orders for businesses competing with the Restricted
Business from any person who (i) at the time of the Agreement or within two
years prior to the date of the Agreement, has been, a customer or client, or
(ii) is an active prospect to be a customer or client, in each case, of the
Seller at the time of the Agreement.
3.
Non-Disclosure of Confidential Information. Seller
and Guarantor acknowledge that it is the policy of the Buyer to maintain as
secret and confidential all Confidential Information, and the parties hereto
recognize that Seller and Guarantor have acquired Confidential Information.
Seller and Guarantor recognize that all such Confidential Information is and
shall remain the sole property of the Buyer, free of any rights of Seller or
Guarantor, and acknowledges that the Buyer and its Affiliates have a vested
interest in assuring that all such Confidential Information remains secret
and
confidential. Therefore, the Seller and Guarantor agree that at all times from
after the date hereof, they will not, directly or indirectly, without the prior
written consent of the Buyer, disclose to any person, firm, company or other
entity (other than the Buyer or any of its Affiliates) any Confidential
Information, except to the extent that (i) any such Confidential Information
becomes generally available to the public or trade, other than as a result
of a
breach by the Seller or Guarantor of this Section 3, or (ii) any such
Confidential Information becomes available to the Seller or Guarantor on a
non-confidential basis from a source other than the Seller, Guarantor, Buyer
or
any of their Affiliates or advisors; provided, that such source is not known
by
the Seller or Guarantor to be bound by a confidentiality agreement with, or
other obligation of secrecy to, the Seller, Guarantor, Buyer or another party.
In addition, it shall not be a breach of the confidentiality obligations hereof
if the Seller or Guarantor is required by law or legal process to disclose
any
Confidential Information; provided, that in such case, the Seller or Guarantor
shall (a) give the Buyer prompt notice that such disclosure is or may be
required, and (b) cooperate with the Buyer, at the Buyer's expense, in
protecting, to the maximum extent legally permitted, the confidential or
proprietary nature of the Confidential Information which must be so disclosed.
The obligations of the Seller and Guarantor under this Section 3 shall survive
any termination of this Agreement.
4.
Non-Solicitation.
At all
times from and after the date of this Agreement and until the expiration of
the
Restricted Period, Seller and Guarantor shall not, directly, indirectly or
otherwise by letters, circulars or advertisements, and whether for themselves
or
on behalf of any other person:
(a)
solicit or, directly or indirectly, cause to be solicited for employment, any
persons who (i) are, at the time of solicitation of employment, employees of
the
Seller, Buyer or any of their respective Affiliates, or (ii) are, at the time
of
solicitation of employment, sales representatives or employees thereof, retained
by the Buyer or any of its Affiliates; or
(b)
employ or, directly or indirectly, cause to be employed, any persons who (i)
are, at the time of such action, employees of the Buyer or any of its
Affiliates, or (ii) are, at the time of such action, sales representatives
or
employees thereof, retained by the Buyer or any of its Affiliates;
provided,
however, that this Section 4 shall not prohibit Seller or Guarantor from
employing or soliciting the employment any person who (A) is an employee of
Seller as of the Agreement Date and (B) is not offered employment by Buyer
as of
the Agreement Date.
5.
Right to Injunctive Relief.
Seller
and Guarantor acknowledge that any breach or threatened breach by it of any
of
the covenants or provisions contained herein will result in irreparable and
continuing harm to the Buyer for which the Buyer would not have adequate remedy
at law. Therefore, Seller and Guarantor acknowledges and agrees that, in
addition to any other remedy which the Buyer may have at law or in equity,
the
Buyer shall be entitled to injunctive relief or other equitable remedies in
the
event of any such breach or threatened breach. Seller and Guarantor further
acknowledges and agrees that monetary damages would be insufficient to
compensate the Buyer in the event of a breach by Seller or Guarantor of any
of
the covenants or provisions contained herein, and that in the event of a breach
thereof, the Buyer shall be entitled to specific performance of the obligations
hereunder.
6.
Enforceability; Severability.
If any
provision of this Agreement shall be adjudicated to be invalid or unenforceable,
then such provision shall be deemed modified, as to duration, territory or
otherwise, so as to be enforceable as similar as possible to the provision
at
issue, in order to render the remainder of this Agreement valid and enforceable.
The invalidity or unenforceability of any provision of this Agreement shall
not
affect the other provisions hereof, and this Agreement shall be construed in
all
respects as if such invalid or unenforceable provision were
omitted.
7.
Successors and Assigns.
This
Agreement shall be binding upon and shall inure to the benefit of Seller and
its
successors and assigns, and shall be binding and inure to the benefit of the
Buyer and its successors and assigns.
8.
Entire Agreement.
This
Agreement, together with the Purchase Agreement and the Transaction Documents,
contains the entire understanding among the parties hereto with respect to
the
subject matter hereof and supersedes all prior negotiations and understandings
among the Buyer and Seller with respect hereto. This Agreement may not be
amended or modified except by a written instrument signed by the parties hereto.
9.
Governing Law; Venue.
(a)
This
Agreement shall be construed in accordance with, and governed in all respects
by, the internal laws of the State of Massachusetts, without giving effect
to
principles of conflicts of laws.
(b)
Unless otherwise explicitly provided in this Agreement, any Proceeding relating
to this Agreement or the enforcement of any provision of this Agreement may
be
brought or otherwise commenced in any state or federal court located in the
County of Middlesex, Massachusetts. Each of Seller, Guarantor and
Buyer:
(i)
expressly and irrevocably consents and submits to the jurisdiction of each
state
and federal court located in the County of Middlesex, Massachusetts and each
appellate court located in the State of Massachusetts, in connection with any
such Proceeding;
(ii)
agrees that each state and federal court located in the County of Santa Clara,
California or Massachusetts shall be deemed to be a convenient
forum;
(iii)
agrees not to assert, by way of motion, as a defense or otherwise, in any such
Proceeding commenced in any state or federal court located in the County of
Santa Clara, California or Massachusetts any claim that such Party is not
subject personally to the jurisdiction of such court, that such Proceeding
has
been brought in an inconvenient forum, that the venue of such Proceeding is
improper or that this Agreement or the subject matter of this Agreement may
not
be enforced in or by such court; and
(iv)
agrees that service in any action may be made by giving notice in accordance
with Section 10.
10.
Notices.
Any
notice or other communication required or permitted to be delivered to any
party
shall be in writing and shall be deemed properly delivered, given and received
when delivered, by hand, by registered mail, by courier or express delivery
service, by facsimile, or by e-mail to the address or facsimile number set
forth
beneath the name of such party below, or to such other address or facsimile
number as such party shall have specified in a written notice given to the
other
parties:
if
to the
Seller or the Guarantor:
Implant Sciences Corporation
▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇, #▇
▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇-▇▇▇▇
|
Attention:
|
Facsimile:
(▇▇▇) ▇▇▇-▇▇▇▇
|
Email:
|
@▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
|
with
a
copy to:
Ellenoff
▇▇▇▇▇▇▇▇ & Schole LLP
▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇ ▇▇▇▇▇-▇▇▇▇
Attention:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
if
to the
Buyer:
▇▇▇▇▇
Analytical Group
LLC
▇▇▇
▇▇▇▇▇
▇▇▇▇
▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Facsimile:
(▇▇▇) ▇▇▇-▇▇▇▇
E-mail:
▇▇▇▇▇▇@▇▇▇▇▇▇▇.▇▇▇
11.
Headings.
The
headings of sections and subsections of this Agreement are for convenience
of
reference only and are not to be considered in construing this Agreement.
12.
Execution in Counterparts.
This
Agreement may be executed in any number of counterparts, each of which shall
be
deemed to be an original, but all of which, when taken together, shall
constitute one and the same instrument.
IN
WITNESS WHEREOF, the parties hereto have caused this Non-Competition and
Nondisclosure Agreement to be executed as of the day and year first above
written.
|
ACCUREL
SYSTEMS INTERNATIONAL CORPORATION
By:
Name:
Title:
|
▇▇▇▇▇
ANALYTICAL GROUP LLC
By:
Name:
Title:
|
|
|
IMPLANT
SCIENCES CORPORATION
By:
Name:
Title:
|
||