Rosetta Stone 2010 Annual Report Download - page 121

of Sections 8(a) and 8(b) above, Executive shall hold Third Party Information in the strictest confidence and shall not disclose to
anyone (other than personnel of the Company or its Subsidiaries who need to know such information in connection with their work for
the Company or its Subsidiaries) or use, except in connection with her work for the Company or its Subsidiaries, Third Party
Information unless expressly authorized by the CEO in writing.
(d) Use of Information of Prior Employers, etc. Executive will abide by any enforceable obligations contained in
any agreements that Executive has entered into with her prior employers or other parties to whom Executive has an obligation of
confidentiality.
(e) Compelled Disclosure. If Executive is required by law or governmental regulation or by subpoena or other valid
legal process to disclose any Proprietary Information or Third Party Information to any Person, Executive will immediately provide
the Company with written notice of the applicable law, regulation or process so that the Company may seek a protective order or other
appropriate remedy. Executive will cooperate fully with the Company and the Company's representatives in any attempt by the
Company to obtain any such protective order or other remedy. If the Company elects not to seek, or is unsuccessful in obtaining, any
such protective order or other remedy in connection with any requirement that Executive disclose Proprietary Information or Third
Party Information then Executive may disclose such Proprietary Information or Third Party Information to the extent legally required;
provided, however, that Executive will use her reasonable best efforts to ensure that such Proprietary Information is treated
confidentially by each Person to whom it is disclosed.
9. Noncompetition and Nonsolicitation.
(a) Noncompetition. As long as Executive is an employee of the Company or any Subsidiary thereof, and for a period
ending twelve (12) months following the Termination Date of Executive's employment (the "Restrictive Covenant Period"), Executive
shall not, directly or indirectly own, manage, control, participate in, consult with, render services for, or in any manner engage in any
business competing with the business of producing and selling software used for learning foreign languages, including English as a
foreign language or any other businesses then carried on by the Company or its Subsidiaries (the "Business") in any geographic area in
which: (i) Executive acted as an employee of the Company or its Subsidiaries and had contact with the customers of the Company or
its Subsidiaries during the 12-month period immediately preceding the Termination Date, and (ii) the Company or its Subsidiaries is
conducting business or has conducted business during the Restrictive Covenant Period.
(b) Nonsolicitation. As long as Executive is an employee of the Company or any Subsidiary thereof, and during the
Restrictive Covenant Period thereafter, Executive shall not directly or indirectly through another entity: (i) induce or attempt to
induce any employee of the Company or any Subsidiary to leave the employ of the Company or such Subsidiary, or in any way
interfere with the relationship between the Company or any Subsidiary and any employee thereof; (ii) hire or employ any person who
was an employee of the Company or any Subsidiary at any time during the 12-month period immediately preceding the Termination
Date; (iii) induce or attempt to induce any customer, supplier, licensee or other business relation of the Company or any Subsidiary to
cease doing business with the Company or such Subsidiary, or in any way interfere with the relationship between any such customer,
supplier, licensee or business relation
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and the Company or any Subsidiary; (iv) solicit or provide services related to the Business to any Person who was a customer or client
of the Company or any Subsidiary at any time during the 12-month period immediately preceding the Termination Date; or (v) solicit
or provide services related to the Business to any Prospective Customer. For purposes hereof, a "Prospective Customer" means any
Person whom the Company or any of its Subsidiaries has entertained discussions with to become a client or customer at any time
during the 12-month period immediately preceding the Termination Date and who has not explicitly rejected a business relationship
with the Company.
(c) Acknowledgment. Executive acknowledges that in the course of her employment with the Company and its
Subsidiaries, she has and will become familiar with the trade secrets and other Proprietary Information of the Company and its
Subsidiaries. Executive further acknowledges that as the President, International, Executive has and will have direct or indirect
responsibility, oversight or duties with respect to the businesses of the Company and its Subsidiaries and its and their current and
prospective employees, vendors, customers, clients and other business relations, and that, accordingly, the geographical restriction
contained in this Section 9 is reasonable in all respects and necessary to protect the goodwill and Proprietary Information of the
Company and that without such protection the Company's customer and client relations and competitive advantage would be
materially adversely affected. It is specifically recognized by Executive that her services to the Company and its Subsidiaries are
special, unique and of extraordinary value, that the Company has a protectable interest in prohibiting Executive as provided in this
Section 9, that Executive is directly responsible for the growth and development of the Company and the creation and preservation of
the Company's goodwill, that money damages are insufficient to protect such interests, that there is adequate consideration being
provided to Executive hereunder, that such prohibitions are necessary and appropriate without regard to payments being made to
Executive hereunder and that the Company would not enter this Agreement with Executive without the restriction of this
Section 9. Executive further acknowledges that the restrictions contained in this Section 9 do not impose an undue hardship on her
and, since she has general business skills that may be used in industries other than that in which the Company and its Subsidiaries
conduct their business, do not deprive Executive of her livelihood. Executive further acknowledges that the provisions of this
Section 9 are separate and independent of the other sections of this Agreement.
(d) Enforcement, etc. If, at the time of enforcement of Section 8 or 9 of this Agreement, a court holds that the
restrictions stated herein are unreasonable under circumstances then existing, the parties hereto agree that the maximum duration,