Non-compete when firm acquired or merged?
I've seen several ML brokers on other posts discuss "getting out before being asked to sign a non-compete" after the BAC acquisition. Is this really an issue? If you have a non-compete with a firm you work for, then that firm is acquired by another, doesn't your non-compete remain valid under the new structure anyway? I know the major wires all have an agreement with one another not to enforce non-competes among themselves but I'm asking this in a larger sense regarding any merger or acquisition.
Bill , I think the assignable comments are in a legal sense absolutely valid and can be enforeced by the courts. The next question of course is.....are the terms significantly different from the original contract? My thought process would be immediately review with my solictor and have him advise as to validity of the contract and if the contract had significant differences from the original contact. Like anything if both parties wish to maintain a relationship a " meeting of the minds " can be reached that satisfy both parties.
If these firms can legally assign these non-competes freely in an aquisition or merger, then why do most retention docs ask that you consent to the assignment?
Bill, although I understand that your post doesn't constitute legal advice for us readers, I want to personally thank you for some very enlightening words. Obviously, each situation is unique, but you've provided some valuable and interesting food for thought.
Agreed. I'm at an institution that is likely to be acquired or merged with another (not that anyone isn't now) and am currently considering the implications.
I know the AGE contract for new brokers is 100% transferable in case of a merger or aquisition. It clearly states it. Question is will they enforce it. If you are failing out they most likely wont. If you are Crest Club of higher you cant count on it. But, it is usually negotiated between the firms down. They cant stop you from working "non compete" but they can nail you for the cost of training, the teeth.
I was directed here from my post "If my branch closes?". Its also a
non-compete type question. I considering joining a large firm from
another large firm. I'm in a small market. In the letter of
understanding should I require the verbiage "If firm closes my office non-compete is void?" I do not want to have to commute 70 miles one way to work.
You can certainly ask for whatever terms you wish. How they will respond to your negotiation is up to them. But you have little to lose by trying.
Before you do, though, make sure you have a copy of the proposed agreement so you can read the exact terms, and have it reviewed by an attorney. They will advise you, and it will be money well spent.
For example, it sounds to me like you may well be asking the wrong question - I believe most wires agreements typically have non-solicits, but not non-competes. Sounds similar, but there's a big difference. If you start out asking for a change to a non-compete and there IS no such clause, you won't be taken seriously.
Hire an attorney. Measure twice, cut once, not vice versa.