Mutual Confidential
FULL SERVICE PRACTICE SALES MUTUAL CONFIDENTIALITY AND NON-DISCLOSURE AGREEMENT
This Mutual Confidentiality and Non-disclosure Agreement (the “Agreement”) is entered into as Dated and signed on the 5th and last page of said agreement herein, between Full Service
Practice Sales, a California Company (“Party A”) and Name:_____________________ (“Party B”). Party A and Party B shall each be individually referred to as a “Party” and collectively as
the “Parties.”
RECITALS
(a) Party A and Party B desire to enter into discussions regarding a possible negotiated transaction between them (the “Possible Transaction”). In the course of their discussions, negotiations and due diligence regarding the Possible Transaction, each Party may disclose information that is of a confidential and proprietary nature solely for the internal evaluation of by either Party the feasibility and desirability of the Possible Transaction (the “Permitted Use”). The Parties wish to protect the confidentiality of such information and prevent the intended or unintended disclosure of same.
(b) Each Party (a “Receiving Party”) understands that the other Party (a “Disclosing Party”) may disclose non-public, confidential and/or proprietary information concerning the Disclosing Party’s business, operations, financial position, forecasts, strategies, marketing plans, product plans, product services, customers, markets, surveys, questionnaires, inventions, software, patents and other intellectual property, trade secrets and technical or proprietary data and methods used or developed and any written or oral plans, lists or other documentation regardless of how memorialized or communicated (including oral, written or electronic communications) by the Disclosing Party, whether furnished before or after the date hereof, whether prepared by the Disclosing Party, its Representatives (as defined in Paragraph 2 below), or otherwise, whether or not marked as being confidential; all of which to the extent disclosed to the Receiving Party is hereinafter referred to as “Confidential Information” of the Disclosing Party. The Confidential Information shall include, without limitation, the existence and details of discussions between the Parties regarding a Possible Transaction, the potential terms of any Possible Transaction, the fact that either Party has provided or will provide Confidential Information to the other Party and such other Party’s Representatives and the existence and terms and conditions of this Agreement.
In consideration of the Parties’ discussions regarding a Possible Transaction and any access the Receiving Party may have to Proprietary Information of the Disclosing Party, the Receiving Party hereby agrees as follows:
1. Confidentiality and Non-Disclosure.
(a) Each Receiving Party agrees (i) to use the Disclosing Party’s Confidential Information solely in accordance with the Permitted Use, (ii) to hold such Confidential Information in strict confidence and to take reasonable precautions to protect such Confidential Information, including, without limitation, all precautions the Receiving Party employs with respect to its own strictly confidential materials; (iii) not to divulge such Confidential Information or any information derived therefrom to any third person without the prior written consent [(including email)] of the Disclosing Party, except that the Receiving Party may disclose Confidential Information to its Representatives on a need-to-know basis in accordance with the Permitted Use and subject to the restrictions contained herein; (iv) not to make any use whatsoever at any time of such Confidential Information except in accordance with the Permitted Use; and (v) not to copy or reverse engineer any such Confidential Information. Any Representative granted access to Confidential Information in accordance with Paragraph 2. Must be provided with a copy of this Agreement in advance and agree in writing to be bound by its terms to the same extent as if they were direct parties to this Agreement. Each Party will be responsible for any breach of this Agreement by its Representatives and agrees, at its sole expense, to take all reasonable measures to restrain its Representatives from prohibited or unauthorized disclosures or use of the Confidential Information.
(b) Without granting any right or license, the Disclosing Party agrees that the term “Confidential Information” shall not include any information that (i) through no improper action or inaction by the Receiving Party or any of its Representatives is or becomes generally available or known to the public; (ii) through no improper action or inaction by the Receiving Party of its Representatives is or was in possession or known by it prior to receipt from the Disclosing Party; (iii) is or was disclosed to the Receiving Party by a third party without violation of any confidentiality obligations[, provided the Receiving Party complies with any restrictions imposed by said third party,] or (iv) is or was independently developed without use of any Confidential Information of the Disclosing Party by employees of the Receiving Party who had no access to such information. The Receiving Party may make disclosures of Confidential Information if required to do so by court order or other enforceable legal process, provided that the Receiving Party uses reasonable efforts to limit disclosure and to obtain confidential treatment or a protective order and notifies the Disclosing Party as promptly as reasonably possible of the required disclosure.
(c) The Receiving Party understands that nothing herein (i) requires the disclosure of any Confidential Information of the Disclosing Party, or (ii) requires the Disclosing Party to proceed with any proposed transaction or relationship in connection with the Possible Transaction. Each Party to this Agreement reserves the right, in its sole discretion, to
determine what information it will provide or withhold, as well as the times at which it will make such information available.
2. Representatives. As used herein, the term “Representatives” shall mean directors, officers, employees, agents (including, without limitation, attorneys, accountants, consultants, bankers and financial advisors), debt and equity financing sources, and legal counsel.
3. Return or Destruction of Confidential Information. If either Party determines that it does not want to continue discussions regarding the Potential Transaction, it will promptly notify the other Party of that determination. Immediately upon receipt of such notification, or at any time on receipt of notice by the Disclosing Party, the Receiving Party will, at its option, either return to the Disclosing Party or destroy such Confidential Information to the Disclosing Party and certify that all documents or media containing any such Confidential Information and any and all copies or extracts thereof have been destroyed and are no longer usable or retrievable in any format.
4. Non-Disclosure of Negotiations. Except to the extent required to comply with applicable law or regulation or with any requirement imposed by judicial or administrative process or any governmental or court order, neither Party shall disclose the existence or subject matter of the Possible Transaction or relationship contemplated by this Agreement.
5. Completeness and Accuracy of Confidential Information. Each Party understands and acknowledges that neither Party nor any of its Representatives makes any representation or warranty, express or implied, as to the accuracy or completeness of the Confidential Information. Each Party agrees that neither Party nor any of its Representatives shall have any liability to the other Party or to any of the other Party’s Representatives relating to or resulting from the use of the Confidential Information or any errors therein or omissions therefrom. Only those representations or warranties made in a Definitive Agreement regarding the Possible Transaction, when and if executed, and subject to the limitations or restrictions specified therein, will have any legal effect. “Definitive Agreement” means a written contract executed by all parties thereto for the Possible Transaction, which binds the parties thereto to close such Possible Transaction, subject only to such conditions to closing as may be negotiated between the parties thereto; not including any executed nonbinding letter of intent or any other preliminary written agreement or any verbal or written acceptance of any offer or bid.
6. Effect of Agreement. Each Party understands and agrees that no contract or agreement providing for any transaction between them shall be deemed to exist between them unless and until a Definitive Agreement has been executed and delivered, and each Party hereby waives, in advance, any claims (including, without limitation, breach of contract and tortious interference claims) in connection with the Possible Transaction unless and until the Parties have entered into a Definitive Agreement. Each Party agrees that neither Party will be under any legal obligation of any kind with respect to the Possible Transaction by virtue of this Agreement except for the matters specifically agreed to herein unless and until the Parties have entered into a Definitive Agreement. Each Party reserves the right, in its sole discretion, for any reason or no reason, to reject any and all proposals made to it or its Representatives with regard to a Possible Transaction and to terminate discussions and negotiations with the other Party at any time; provided that this Agreement shall thereafter continue in full force and effect.
7. Non-Solicitation. Each Party understands and agrees that, for a period of [two (2)] years from the date hereof, neither it nor any of its Representatives or affiliates may solicit for hire any of the officers or other employees of the other Party or any of its subsidiaries or any persons who are independent contractors of the other Party, or any of its subsidiaries who provide services to such other Party or subsidiaries on an ongoing basis. The foregoing will not apply to (a) persons hired as a result of the use of (i) an independent employment agency or (ii) a general solicitation (such as a newspaper advertisement or on radio or television), in either case not specifically directed to employees of the other Party and (b) persons terminated without cause.
8. Scope and Term of Agreement. Except as set forth in Paragraph 7, the obligations hereunder with respect to the Confidential Information shall remain as long as such
information retains its status as Confidential Information and is not excluded pursuant to Paragraph 1(b) of this Agreement, and for information which is a trade secret, the foregoing commitments shall remain in place as long as the applicable information retains its status as a trade secret. The Parties agree that the terms and restrictions herein shall apply fully to each of such Party’s subsidiaries and affiliates.
9. Remedies. The Receiving Party acknowledges and agrees that, due to the unique nature of the Disclosing Party’s Proprietary Information, money damages would not be a sufficient remedy for any breach of this Agreement and that there can be no adequate remedy at law for any breach of its obligations hereunder resulting in irreparable harm to the Disclosing Party. Therefore, upon any such breach or any threat thereof, the Disclosing Party shall be entitled to appropriate equitable relief in addition to whatever remedies it might have at law without the necessity of posting any bond or other security.
10. Governing Law. This Agreement shall be governed by the laws of the State of [California] without regard to the conflicts of law provisions thereof. All disputes with respect to this Agreement shall be brought and heard exclusively in the federal or state courts located in [Orange County, in the State of California]. The Parties each consent to the in personam jurisdiction and venue of such courts. The Parties agree that service of process upon them in any such action may be made if delivered in person, by courier service, by facsimile or by first class mail, and shall be deemed effectively given upon receipt.
11. Miscellaneous Provisions. If any of the provisions of this Agreement are held by a court or other tribunal of competent jurisdiction to be illegal, invalid, or unenforceable, such provisions shall be limited or eliminated to the minimum extent necessary so that this Agreement shall otherwise remain in full force and effect. This Agreement supersedes all prior discussions and writings and constitutes the entire agreement between the Parties with respect to the subject matter hereof. The Parties acknowledge and agree that they have both participated in the negotiations and preparation of this Agreement and that no presumption or burden of proof shall be raised in any question of interpretation of this Agreement based upon any assertion that one Party or the other has drafted this Agreement or any provision hereof. The prevailing Party in any action to enforce this Agreement shall be entitled to costs and attorney’s fees. No waiver or modification of this Agreement will be binding upon either Party unless made in writing and signed by a duly authorized Representative of such Party. Neither Party shall be deemed by mere lapse of time (without giving notice or taking other action hereunder) to have waived any breach by the other Party of any of the provisions of this Agreement. The waiver by either Party of a particular breach of this Agreement by the
other Party shall not be construed as, or constitute, a continuing waiver of such breach, or of other breaches of the same or other provisions of this Agreement. Any notice, consent, or waiver required or permitted to be given under this Agreement shall be in writing and be deemed given to a Party when delivered by hand or received by registered or certified mail, postage prepaid, nationally recognized courier service, facsimile (with written telephonic confirmation of delivery), or by email or other electronic delivery (with electronic proof of delivery), in each case, addressed to the Party at the address provided for such Party on the signature page below. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. All signatures of the Parties to this Agreement may be transmitted by PDF, facsimile, or other electronic means, and such PD, facsimile, or other electronic means, for all purposes, be deemed to be the original signature of such Party whose signature it reproduces, and will be binding upon such Party. EACH PARTY SPECIFICALLY WAIVES ANY RIGHT IT MIGHT OTHERWISE HAVE TO A JURY TRIAL WITH RESPECT TO ANY MATTER ARISING UNDER THIS AGREEMENT.