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2. The Restrictive Covenant
On the condition that HJA pay the option price to Henry as
required by the EOA, Henry agreed to be bound by a restrictive
covenant clause, which provided that Henry must not engage in
competition directly or indirectly with HJA, Abram, Julius,
Chevrolet, or Park Place for 5 years commencing on April 1, 1990
(covenant not to compete).12 In consideration for the covenant
not to compete and as an inducement for Henry to enter into the
EOA, HJA agreed to compensate Henry as follows:
HJA shall pay to HM the sum of Two Million Eight
Hundred Fifty-Two Thousand Dollars ($2,852,000.00),
payable in one hundred twenty (120) equal consecutive
monthly installments of Twenty-Three Thousand Seven
Hundred Sixty-Six and 67/100 Dollars ($23,766.67) each,
such payments to compensate HM for his agreement not to
compete, as herein provided.
3. Related Agreements
In order to coordinate the covenant not to compete payments
HJA owed to Henry with the payments Henry owed on the FirsTier
note and the Chevrolet debt, the parties to the EOA entered into
two additional agreements. First, HJA, Henry, Abram, and Julius
entered into a side letter agreement dated March 15, 1990 (the
side letter agreement). The side letter agreement provided for
the establishment of a “sweep account” at National Bank of
Commerce (NBC), into which the covenant not to compete payments
12The parties have stipulated that the covenant not to
compete is a legal and enforceable covenant under Nebraska law.
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