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g. Petitioner's Interest in Eliminating Competition
It appears from the fact that the 1986 stock purchase
agreement included an agreement not to compete that petitioner
wanted to eliminate competition. This is confirmed by the fact
that petitioner paid Grecco $513,400 for her stock (which was
worth $189,300) and for the covenant not to compete. This factor
favors petitioner somewhat.
h. Duration and Geographic Scope of the Covenant
Grecco's covenant applied to competition in Oregon and
Washington for 3 years. We think these limits were reasonably
drawn to keep Grecco from competing with petitioner. This factor
favors petitioner.
i. Grecco's Intent to Reside in the Same Geographic Area
Grecco still resides in the Portland area. This factor
favors petitioner somewhat.
4. The Liquidated Damages Provision
Respondent contends that the stock purchase agreement did
not require petitioner to make any payment for the covenant not
to compete. Respondent argues that petitioner intended that the
entire amount of the formula purchase price was to be payment
for the departing shareholder's stock. We disagree.
First, we fail to see why petitioner would pay $513,400 for
stock the parties agree is worth $189,300. Second, Grecco agreed
to pay a 25-percent penalty if she breached the covenant not to
compete.
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