No. 202.

Agreement whereunder partners and corporations agree to form new corporation and partners agree to sell their business, trade-marks, trade-names, processes, etc., to new corporation, with covenants to enter employ of new corporation, instruct its agents in the use of formulæ and not otherwise to engage in the same business for twenty years.5

AGREEMENT, made January 5, 1923, by John Doe and Henry Doe, of Plattsburg, New York, engaged in business as partners, under the name and style of "Doe & Co." (herein called the "Partners"), and the Roe Tobacco Co., a corporation, duly organized under the laws of the State of New York, and having its principal office at No. 111⁄2 Broadway, Borough of Manhattan, New York City (herein called the "New York Corporation"), and the Koe Tobacco Co., a corporation, duly organized under the laws of the State of New Jersey, and having its principal office at No. 371⁄2 North Eleventh Street, Newark, New Jersey (herein called the "New Jersey Corporation"),

WHEREIN IT IS AGREED, AS FOLLOWS:

1. That the Partners, as an inducement to the New York Corporation and the New Jersey Corporation to enter into this contract, represent and warrant to them:

(a) That, as partners in the business of manufacturing and selling cigars, under various brands, they have, for the past two years, done business, as follows:

Adapted from American Tobacco Co. v. U. S. (1910), 221 U. S. 106, 31 Sup. Ct. Rep. 632, 55 Law ed. 663.

(b) That the Partners have used, without interference or adverse claim, the trade-marks, used by them, and that they will be able to make the conveyance, or conveyances, hereinafter set out and hereinafter contemplated; and that said conveyances, when so made, will convey to the purchaser all of their property and goodwill needful and useful in the carrying on of the said business, free from any debts, or liabilities, and with full power and right in the purchaser to make use of the brands and trade-marks conveyed, as well as the tangible property and the trade-name, "Doe & Co."

2. That expert accountants and agents selected by the New York Corporation and the New Jersey Corporation, may examine the books, papers, property and business of the Partners, in order to verify the representations above made, and that the Partners will afford such expert accountants and agents full and unrestricted opportunity to make such examination.

3. That, if upon the completion of such examination, such expert accountants and agents of the New York Corporation and the New Jersey Corporation shall agree and report that the representations of the Partners above made are substantially true, then, and in that case, a corporation shall be formed under the laws of the State of New Jersey, with an authorized capital stock of ten million ($10,000,000) dollars, with power to engage in the business of manufacturing and selling cigars, cheroots and little cigars, and with such other powers as the New York Corporation and the New Jersey Corporation shall desire, or be advised are desirable.

4. That said new corporation shall be organized, and the examinations, which are herein provided for, shall be made, as expeditiously as possible, so that on, or as soon as practicable after, January 26, 1923, the Partners shall convey to said new corporation their entire cigar business, including the name, good-will, trade-marks, trade-names, symbols, patents and copyrights thereof,

and rights analogous thereto, recipes of manufacture, and including, also, stock on hand, whether manufactured, in process of manufacture, or fully manufactured, labels, wrapping material, advertising matter, and supplies, machines, and appliances suitable and useful in the manufacture of cigars, and such as have been used by the Partners in their manufacture of cigars, real estate in Plattsburg, New York, suitable for the business of said new corporation, and all other property, whether herein specifically mentioned or not, owned by the Partners, which shall be useful and available in the business of cigar manufacturing (except cash on hand, bills receivable, accounts receivable and contracts not hereinafter scheduled belonging to the Partners; and all of such cash, bills and accounts receivable, and contracts not hereinafter scheduled are hereby expressly excluded from the aforesaid contemplated conveyance); it being agreed that the said conveyance shall include the exclusive right to the use of the firm name of the partnership, "Doe & Co.," as well as the name, or names, of such of the Partners, which the Partners have, or the co-partnership has, a right to use on labels, or advertisements.

5. That said conveyance or conveyances shall be made as of the date of January 26, 1993; and said conveyance shall contain warranties by the Partners, jointly and severally, that the business and property conveyed is free from any lien, debt, liability, encumbrance or assessment of any kind, legal or equitable, including all taxes of whatever sort for the year 1922, and that the trade-marks conveyed are valid trade-marks, which the Partners have the right to convey; and that they will, jointly and severally, warrant and defend the title made to said new corporation against all claims whatsoever and all persons whomsoever.

6. That at the time of said conveyance, and in the same instrument, the Partners shall, and will, covenant and agree, each for himself, that he will not, for a term of twenty (20) years from the date of said conveyance, directly or indirectly, engage in the manufacture of tobacco into cigars, or into any other of its forms, or in distributing the same, or own stock in any corporation (other than said new corporation, the New York Corporation, and the New Jersey Corporation) so engaged in such manufacture, or distribution, within the several states, colonies, or dependencies of the United States (except the state of Utah and the territory of Alaska), or the several countries, or nations, of Europe, except for,

or with the written consent of, the said new corporation, authorized by a majority vote of all of its directors; and that they will not, during said term of twenty (20) years, permit the use of their names, or the name of either of them, whether in connection with each other or separately, or with, or without, other names, or

initials.

7. That, at the time of said conveyance, and in the same instrument, the Partners shall, each for himself, agree to enter into, and devote his whole time and best efforts to, the service of said new corporation, and, if the new corporation desires so long to retain him, to remain in its service for five (5) years, at the following salaries, respectively, all payable in equal monthly installments, to wit: John Doe, ten thousand ($10,000) dollars per year; and Henry Doe, ten thousand ($10,000) dollars per year. But said contract of employment shall not, however, require the new corporation to retain the services of either of the Partners beyond a year after the said conveyance; and, after such first year term, the new corporation may, at any time, dispense with the services of either of said Partners, without thereby incurring any liability to him in respect of any part of the unexpired term of five years.

8. That, at the time of said conveyance, and in the same instrument, the Partners shall further, each for himself, agree to instruct, at any time thereafter, the designated agents of the said new corporation as to any of the formulæ, processes or recipes for the treatment, or cure, of tobacco and the manufacture of cigars used by, or known to, him, and further instruct such designated agents in the use of such formulæ, processes or recipes, and that he will not make use of, or make known to any person or persons other than such designated agents, any of such formulæ, processes or recipes.

9. That, in consideration of the conveyance, covenants and agreements by the Partners as aforesaid, the said new corporation shall pay to the Partners:

(a) The sum of one million ($1,000,000) dollars in cash, which amount shall be in full payment for the trade-names, good-will, trade-marks, symbols, recipes, copyrights, patents and rights analogous thereto, and all other intangible assets of whatever kind, belonging to the said Partners, and in any way useful, or available, in the cigar business, except book accounts, bills receivable and contracts not scheduled as herein provided; and

(b) A further sum for the tangible assets useful and available in