Attached files
| file | filename |
|---|---|
| 8-K - NUTRITION 21 INC | v170426_8k.htm |
| EX-10.08 - NUTRITION 21 INC | v170426_ex10-08.htm |
| EX-10.04 - NUTRITION 21 INC | v170426_ex10-04.htm |
| EX-99.1 - NUTRITION 21 INC | v170426_ex99-1.htm |
| EX-10.02 - NUTRITION 21 INC | v170426_ex10-02.htm |
| EX-10.07 - NUTRITION 21 INC | v170426_ex10-07.htm |
| EX-10.03 - NUTRITION 21 INC | v170426_ex10-03.htm |
| EX-10.05 - NUTRITION 21 INC | v170426_ex10-05.htm |
| EX-10.01 - NUTRITION 21 INC | v170426_ex10-01.htm |
Exhibit
10.06
Non-Competition
Agreement
This Non-Competition Agreement is
entered into on December 29, 2009 by and among Nature’s Products, Inc., a
Florida corporation ("Buyer"), and Nutrition 21, Inc., a New York corporation,
(“Nutrition 21” or “Seller”).
Whereas,
Buyer and Nutrition 21 have entered into an Asset Purchase Agreement, dated
December 29, 2009, (the “Purchase Agreement”) which contemplates the purchase by
Buyer of certain of the assets and the business of Nutrition 21;
Whereas,
it is a material inducement to Buyer’s obligation to consummate the transactions
under the Purchase Agreement that Nutrition 21, enter into this Non-Competition
Agreement; and
Whereas,
hereafter the term “Buyer" shall include all of its affiliates, as defined
below, which are engaged in any component of the Business (as defined
below).
Now,
Therefore, in consideration of the mutual promises and covenants set
forth herein and other valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto, intending to be legally
bound, agree as follows:
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1.
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Background.
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a.
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Nutrition
21 hereby acknowledges that Buyer is purchasing certain assets of
Nutrition 21 and the goodwill value of the Business. Nutrition
21 hereby further acknowledges that Buyer intends to conduct the Business
and the restrictive covenants set forth hereinafter are a condition to
Buyer’s obligation to consummate the transactions contemplated in the
Purchase Agreement because they are necessary to preserve the value of the
Business as conducted by Nutrition 21 and as will be conducted by
Buyer.
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b.
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In
view of the fact that any activity of Nutrition 21 in violation of the
terms hereof will adversely affect Buyer and will deprive Buyer of
material benefits and bargains under the Purchase Agreement, Nutrition 21
hereby agrees to the restrictions set forth
herein).
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2.
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Certain
Definitions.
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(i)
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“Restricted
Activities” means the sale of finished and packaged nutritional supplement
end-products to end users or for ultimate sale to end users without
further fabrication or packaging; provided that sale of products that are
sold solely by prescription or that do not contain Chromium Picolinate,
Chromium Histidinate, Chromium Picolinate-Biotin Blend,
Arginine-Silicate-Inositol Blend, fish oil or omega 3 shall in no event
constitute Restricted Activities.
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(ii)
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For
clarity, it is agreed that it is not a Restricted Activity for Nutrition
21 to engage in the sale of any and all raw materials, formulations,
compounds, blends and bulk and other materials to third party non-end
users to be further fabricated, blended or packaged for ultimate sales to
end-users as nutritional supplements or otherwise, whether or not (i) sold
by prescription or (ii) containing Chromium Picolinate, Chromium
Histidinate, Chromium Picolinate-Biotin Blend, and
Arginine-Silicate-Inositol Blend, fish oil or omega
3.
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(iii)
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the
term “affiliate” shall mean, with respect to any person or entity, any
person or entity which directly or indirectly controls, is controlled by
or is under common control with such person or
entity,
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(iv)
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the
term “person” shall mean an individual, a corporation, an association, a
partnership (limited or general), a limited liability company, an estate,
a trust, and any other entity or
organization,
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(v)
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The
term “Restricted Region” shall mean anywhere within the
world.
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(vi)
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The
term “Business shall mean a business that sells finished and packaged
end-products to retailers for ultimate sale to end users without further
fabrication or packaging.
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(vii)
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All
capitalized terms used herein and not defined shall have the meanings
given to them in the Purchase
Agreement.
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3.
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Non Competition and
Non-Solicitation.
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a.
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Nutrition
21 acknowledges that, through the Closing Date, it conducted the Business
in the Restricted Region.
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b.
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Nutrition
21 hereby agrees that during the period commencing on the date hereof and
ending exactly four years thereafter, Nutrition 21 will not, directly or
indirectly, for the account or benefit of its own accounts or that of any
other person, anywhere in the Restricted Region (which shall include
directing activity within the Restricted Region from outside the
Restricted Region):
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i.
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engage,
participate or invest in, or provide or facilitate the provision of
financing to, or in any way assist (whether as an employee, owner,
part-owner, shareholder, member, partner, director, officer, trustee,
principal, agent or consultant, or in any other capacity) any activity,
business, organization or person whose or which business, activities,
products or services constitute Restricted Activities;
or
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ii.
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induce
or attempt to induce any employee of Buyer to leave the employ of Buyer,
in any way interfere with the relationship between Buyer and any of its
employees; employ, or otherwise engage as an employee, independent
contractor, or otherwise, any employee of Buyer; or induce or attempt to
induce any customer, supplier, licensee, or business relation of Buyer to
cease doing business with Buyer, or in any way interfere with the
relationship between any customer, supplier, licensee, or business
relation of Buyer (this clause 3.b.ii. shall not restrict sales to
customers of Buyer if such sales are not Restricted
Activities).
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4.
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Excluded Inventory. The
parties agree that all sales of Excluded Inventory, as such term is
defined in the Purchase Agreement, by Seller shall be by a means and into
a market agreed to by the Buyer and Seller in advance of any such
sales.
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5.
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Confidential
Information and Cooperation.
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a.
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Nutrition 21 acknowledges
that all confidential information relating to Buyer and the Business,
including without limitation (a) trade secrets and intellectual property,
(b) information concerning services and products and the development,
manufacturing, marketing, distribution and pricing of services and
products, (c) information concerning customers, customer lists and
suppliers and (d) credit and financial data and (d) all of the
Assets (as defined in the Purchase Agreement) (collectively, the
“Proprietary Information”), are valuable, special and unique assets of the
Buyer, access to and knowledge of which have been gained by Nutrition
21.
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b.
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Nutrition
21 further agree that all Proprietary Information shall be considered
confidential information and that from and after the date hereof Nutrition
21 will (x) not disclose, at any time, any of such Proprietary Information
to any person or entity for any reason or purpose whatsoever, (y) not make
use of any Proprietary Information for its own purposes or for the benefit
of any person other than Buyer except that Nutrition 21 may use customer
lists for non-Restricted Activities, and (z) surrender immediately to
Buyer all Proprietary Information existing in tangible form (whether in
print, photos, audio or video tape, computer disk or memory, or otherwise)
which is in the possession or control of either Nutrition 21, except that
Nutrition 21 may retain customer lists to be used exclusively for
non-Restricted Activities.
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6.
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Scope of
Agreement.
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a.
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Nutrition
21 acknowledges that the time, scope, geographic area and other provisions
of this Agreement have been specifically negotiated by sophisticated
commercial parties and agree that (a) all such provisions are reasonable
under the circumstances of the transactions contemplated hereby and by the
Purchase Agreement, (b) are given as an integral and essential part of the
transactions contemplated hereby and by the Purchase Agreement, and (c)
but for the covenants of Nutrition 21 contained in this Agreement, Buyer
would not have entered into or would not consummate the transactions
contemplated by the Purchase
Agreement.
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b.
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Nutrition
21 acknowledges and agrees that it has independently consulted with its
counsel and has been advised in all respects concerning the reasonableness
and propriety of the covenants contained herein, with regard to the
Business, and represent that the Agreement is intended to be, and shall
be, fully enforceable and effective in accordance with its
terms.
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7.
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Certain Remedies,
Severability. It is specifically understood and agreed
that any breach of the provisions of this Agreement by Nutrition
21 will result in irreparable injury to Buyer and Buyer, that
the remedy at law alone will be an inadequate remedy for such breach and
that, in addition to any other remedy it may have, Buyer shall be entitled
to enforce the specific performance of this Agreement against Nutrition 21
through both temporary and permanent injunctive (and other equitable)
relief without the necessity of proving monetary damages, but without
limitation of its right to damages and any and all other remedies
available to Buyer, it being understood that injunctive relief is in
addition to, and not in lieu of, such other remedies. In the
event that any covenant contained in this Agreement shall be determined by
any court of competent jurisdiction to be unenforceable by reason of its
extending for too great a period of time or over too great a geographical
area or by reason of its being too extensive in any other respect, it
shall be interpreted to extend only over the maximum period of time for
which it may be enforceable and/or over the maximum geographical area as
to which it may be enforceable and/or to the maximum extent in all other
respects as to which it may be enforceable, all as determined by such
court in such action. The existence of any claim or cause of
action which Nutrition 21 or any other party may have against Buyer shall
not constitute a defense or bar to the enforcement of any of the
provisions of this Agreement.
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8.
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Jurisdiction. The
parties hereby irrevocably submit to the exclusive jurisdiction and venue
of the courts of Broward County, Florida to enforce the covenants
contained in this Agreement. In the event that a court shall
hold such covenants unenforceable (in whole or in part) by reason of the
breadth of such scope or otherwise, it is the intention of the parties
hereto that such determination shall not bar or in any way affect the
right of Buyer to the relief provided for herein in the courts of any
other state within the geographic scope of such covenants, as to breaches
of such covenants in such other respective states, the above covenants as
they relate to each state being, for this purpose, severable into distinct
and independent covenants.
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9.
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Notices. All
notices shall be provided to the parties in the manner provided in the
Purchase Agreement.
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10.
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Miscellaneous. This
Agreement shall be governed by and construed under the internal laws, and
not the laws of conflicts of laws, of the State of Florida, and shall not
be amended or modified in whole or in part except by an agreement in
writing signed by each party. The prevailing party in any
controversy hereunder shall be entitled to reasonable attorneys’ fees and
expenses. The failure of any of the parties to require the
performance of a term or obligation or to exercise any right under this
Agreement or the waiver of any breach hereunder shall not prevent
subsequent enforcement of such term or obligation or exercise of such
right or the enforcement at any time of any other right hereunder or be
deemed a waiver of any subsequent beach of the provision so breached, or
of any other breach hereunder. This Agreement shall inure to
the benefit of, and be binding upon, successors and permitted assigns of
the parties hereto. This Agreement may not be assigned by
Nutrition 21 or IH. This Agreement supersedes all prior
understandings and agreements between the parties relating to the subject
matter hereof.
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11.
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Counterparts. This
Agreement may be executed in two counterparts, each of which shall be
deemed an original and all of which together shall constitute one and the
same instrument.
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In
Witness Whereof, the parties have executed this Non-Competition Agreement
as of the date first set forth above.
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Buyer:
Nature’s Products, Inc.
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By:
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Seller:
Nutrition 21, Inc.
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By:
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