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Non Competition & Consulting Agreement
This Agreement is made and entered into on _________________, 20 ___ By and among ________________, Inc., a _______________ (state) corporation (hereinafter Seller), and ______________ (hereinafter Shareholders). This Agreement is executed contemporaneously with and is made a part of that Asset Purchase Agreement by and between Buyer and Seller of even date herewith. All parties state and acknowledge as follows:
[a] Buyer proposes to buy and Seller proposes to sell to Buyer pursuant to the Asset Purchase Agreement all of the assets of Seller;
[b] Shareholders are all of the shareholders of Seller; and
[c] Buyer is unwilling to purchase all the assets of Seller unless Shareholders agree to provide consulting services to Buyers after that purchase and unless Seller and Shareholders agree not to compete with or against the business of Buyer after that purchase.
THEREFORE, as an inducement to Buyer to purchase all the assets of Seller, and as part of the consideration for that purchase, Seller and Shareholders agree as follows:
1. Covenant Not To Compete Following Sale of Business. Seller and Shareholders covenant not to engage in any business in competition with Buyer within ____________,____________________, ____________________, or ____________________, (counties) in _____________, (state) for a period of five (--) years following the date of closing on the purchase pursuant to the Asset Purchase Agreement. Any of the following activities will be deemed to constitute engaging in a business in competition with Buyer:
[a] Owning, operating, participating in or engaging in a retail business which sells any of the same products or items sold by Buyer; or
[b] Owning, operating, participating in or engaging in a retail business which sells products or items which are substantially similar to any of those sold by Buyer.
2. Remedies of Buyer and Liquidated Damages. The foregoing covenant shall be enforceable at law and in equity, and Buyer shall be entitled to enforce the covenant by injunctive relief. In addition, Buyer shall be entitled to recover from the breaching party liquidated damages in the amount of $------ for breach of the covenant. Such sum shall be awarded to Seller in lieu of actual damages, which would be difficult to ascertain with certainty, and shall not be considered a penalty.
3. Training Services. Shareholders shall provide training services to Buyers employees for a period of three (3) weeks at no cost to Buyer. The three weeks of training shall begin on ___________, 20 ___, and shall continue for three successive weeks. Each Shareholder shall provide three (--) working hours of training during each of the three weeks of training.
4. Consultation. Shareholders shall each provide at least thirty-six (--) hours of consulting services to Buyer over a twelve month period beginning on _______________, 20 ___. The Shareholders will be compensated by Buyer for any consultation time in excess of thirty-six (--) hours each at the rate of $------ per hour.
5. Entire Agreement. This Agreement sets forth the entire agreement among the parties with regard to its subject matter. No other agreements, representations, or warranties have been made by any party to the other with respect to the subject matter of this Agreement.
6. Parties. This Agreement shall be binding on, and shall inure to the benefit of, each partys successors in interest, heirs and assigns.
7. Controlling Law. This Agreement shall be construed according to, and the rights of the parties shall be governed by, the laws of the State of ______________________.
8. Attorneys Fees. If any legal action is necessary to enforce the terms of this Agreement, the prevailing party shall be entitled to reasonable attorneys fees in addition to any other relief to which that party may be entitled.
9. Severability. If any of the provisions of this Agreement are found or deemed by a court of competent jurisdiction to be invalid or unenforceable, they shall be considered severable from the remainder of this Agreement and shall not cause the remainder to be invalid or unenforceable.
10. Amendment. This Agreement may be amended only by a written instrument signed be all the parties hereto.