DIY Legal Forms

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Confidentiality Agreement

(Type "B")

1. Introduction. To induce the shareholders of [name of corporation] (Company) to enter into a Letter of Intent to sell its assets to [name of corporation] (Promisor) and to furnish Promisor with certain information that is proprietary and confidential, Promisor hereby warrants, represents, covenants, and agrees as follows:

2. Access to Information. Promisor in the course of examining Company's records and business will have access to or learn certain information belonging to Company that is proprietary and confidential (Confidential Information).

3. Definition of Confidential Information. The term "Confidential Information," as used throughout this Agreement, means any secret or proprietary information relating directly to Company's business and that of Company's affiliated companies and subsidiaries, including, but not limited to, products, customer lists, pricing policies, employment records and policies, operational methods, marketing plans and strategies, product development techniques or plans, business acquisition plans, new personnel acquisition plans, methods of manufacture, technical processes, designs and design projects, inventions and research programs, trade know-how, trade secrets, specific software, algorithms, computer processing systems, object and source codes, user manuals, systems documentation, and other business and financial affairs of Company and Company's affiliated companies and subsidiaries.

4. Nondisclosure. Promisor will keep strictly confidential all Confidential Information and will not, without Company's express written authorization, signed by one of Company's authorized officers, use or sell, market or disclose any Confidential Information to any third person, firm, corporation, or association for any purpose. Promisor further agrees that Promisor will not make any copies of the Confidential Information except upon Company's written authorization, signed by one of Company's authorized officers, and will not remove any copy or sample of Confidential Information from the premises of Company without such authorization.

5. Return Documents. Upon receipt of a written request from Company, Promisor will return to Company all copies or samples of Confidential Information which, at the time of the receipt of the notice, are in Promisor's possession.

6. Duration of Agreement. The obligations imposed on Promisor shall continue with respect to each unit of the Confidential Information if the sale of Company's shares to Promisor does not occur, and such obligations shall not terminate until such unit shall cease to be secret and confidential and shall be in the public domain, unless such event shall have occurred as a result of wrongful conduct by Promisor or Promisor's agents, servants, officers, or employees or a breach of the covenants set forth in this Agreement.

7. Equitable Relief. Promisor acknowledges and agrees that a breach of the provisions of Paragraphs 4 or 5 of this Agreement would cause Company to suffer irreparable damage that could not be adequately remedied by an action at law. Accordingly, Promisor agrees that Company shall have the right to seek specific performance of the provisions of Paragraphs 4 and 5 to enjoin a breach or attempted breach of the provisions thereof, such right being in addition to all other rights and remedies that are available to Company at law, in equity, or otherwise.

8. Severability of Clauses. If any provision of this Agreement or its application is held to be invalid, illegal, or unenforceable in any respect, the validity, legality, or enforceability of any of the other provisions and applications therein shall not in any way be affected or impaired.

9. Entire Understanding. This Agreement sets forth the entire understanding between the parties with respect to the subject matter hereof and may not be modified, changed, or amended, except by a writing signed by the party to be charged.

10. Governing Law. This Agreement, regardless of where made, shall be construed and enforced in accordance with laws of [state] applicable to agreements to be executed and performed wholly within said State.