APPENDIX 2

Non-Disclosure Agreement (Mutual)

Note: Non-disclosure agreements can contain many other terms and conditions including non-competes and non-interference, depending on your needs and consideration provided. All agreements should be reviewed and approved by your legal counsel for compliance with state law and alignment with your needs. This agreement is set up to protect disclosure by both parties. The definition of “Confidential Information” is quite extensive and can be shortened, but does give you a good idea of possible information that may be included in this type of document.

 

This Agreement governs the disclosure of information by and between Great Starts, Inc., and _______________________ [second party to agreement], as of _____________________ [date] (the “Effective Date”).

As used herein, “Confidential Information” shall mean any and all technical and nontechnical information provided by either party to the other, including but not limited to (a) patents and patent applications, (b) trade secrets, and (c) proprietary information—mask works, ideas, media, techniques, sketches, drawings, works of authorship, models, inventions, knowhow, equipment, software programs, software source documents, and formulae related to the current, future, and proposed products and services of each of the parties, and including, without limitation, their respective information concerning research, experimental work, development, design details and specifications, engineering, financial information, procurement requirements, purchasing, manufacturing, customer lists, investors, employees, business and contractual relationships, business forecasts, sales and merchandising, marketing plans, and information the disclosing party provides regarding third parties.

[Optional: If you anticipate receipt of confidential information of any significance, you may wish to add the following language to ensure you understand what is confidential. Of course, these terms will also apply to any information you communicate, in writing or orally. Even without this additional, optional language, always mark your confidential information as such to ensure clear understanding of confidentiality by the receiving party. “If the Confidential Information is embodied in tangible material (including without limitation software, hardware, drawings, graphs, charts, disks, tapes, prototypes, and samples), it shall be labeled as “Confidential” or bear a similar legend. If the Confidential Information is disclosed orally or visually, it shall be identified as such at the time of disclosure and be confirmed in writing to the receiving party within thirty (30) days of such disclosure, referencing the place and date of oral or visual disclosure and the names of the employees of the receiving party to whom such oral or visual disclosure was made, and including therein a brief description of the Confidential Information disclosed.”]

Each party agrees that at all times and notwithstanding any termination or expiration of this Agreement it will hold in strict confidence and not disclose to any third party Confidential Information of the other, except as approved in writing by the other party to this Agreement, and will use the Confidential Information for no purpose other than _______________________________ [Define the permitted use, which is usually “evaluating or pursuing a business relationship with the other party to this Agreement.”] Notwithstanding the above, the party to whom Confidential Information was disclosed (the “Recipient”) shall not be in violation of this Section 2 with regard to a disclosure that was in response to a valid order by a court or other governmental body, provided that the Recipient provides the other party with prior written notice of such disclosure in order to permit the other party to seek confidential treatment of such information. Each party shall permit access to Confidential Information of the other party only to those of its employees or authorized representatives who have a need to know and who have signed confidentiality agreements or are otherwise bound by confidentiality obligations at least as restrictive as those contained herein.

Each party shall immediately notify the other upon discovery of any loss or unauthorized disclosure of the Confidential Information of the other party.

Each party’s obligations under this Agreement with respect to the relevant portion of the other party’s Confidential Information shall terminate when the Recipient can document that: (a) it was in the public domain at the time it was communicated to the Recipient by the other party; (b) it entered the public domain subsequent to the time it was communicated to the Recipient by the other party through no fault of the Recipient; (c) it was in the Recipient’s possession free of any obligation of confidence at the time it was communicated to the Recipient by the other party; (d) it was rightfully communicated to the Recipient free of any obligation of confidence subsequent to the time it was communicated to the Recipient by the other party; or (e) it was developed by employees or agents of the Recipient independently of and without reference to any information communicated to the Recipient by the other party.

Upon termination or expiration of the Agreement, or upon written request of the other party, each party shall promptly return to the other all documents and other tangible materials representing the other’s Confidential Information and all copies thereof.

The parties recognize and agree that nothing contained in this Agreement shall be construed as granting any property rights, by license or otherwise, to any Confidential Information of the other party disclosed pursuant to this Agreement, or to any invention or any patent, copyright, trademark, or other intellectual property right that has issued or that may issue, based on such Confidential Information. Neither party shall make, have made, use, or sell for any purpose any product or other item using, incorporating, or derived from any Confidential Information of the other party.

Confidential Information shall not be reproduced in any form except as required to accomplish the intent of this Agreement. Any reproduction of any Confidential Information of the other party by either party shall remain the property of the disclosing party and shall contain any and all confidential or proprietary notices or legends that appear on the original, unless otherwise authorized in writing by the other party.

This Agreement shall terminate ________ ( ) years [often one to two years] after the Effective Date, or may be terminated by either party at any time upon thirty (30) days’ written notice to the other party. The Recipient’s obligations under this Agreement shall survive termination of the Agreement between the parties and shall be binding upon the Recipient’s heirs, successors, and assigns. The Recipient’s obligations hereunder shall continue in full force and effect with respect to all Confidential Information for ______ ( ) years [often three to five years or indefinitely] from the date of disclosure of such Confidential Information. The protection period for Confidential Information marked or otherwise identified as trade secret shall be for so long as such trade secret information remains secret and confidential and is protected under applicable laws.

This Agreement shall be governed by and construed in accordance with the laws of the State of ______________ without reference to conflict of laws principles. This Agreement may not be amended except by a writing signed by both parties hereto.

If any provision of this Agreement is found by a proper authority to be unenforceable or invalid, such unenforceability or invalidity shall not render this Agreement unenforceable or invalid as a whole, and in such event, such provision shall be changed and interpreted so as to best accomplish the objectives of such unenforceable or invalid provision within the limits of applicable law or applicable court decisions.

Neither party will assign or transfer any rights or obligations under this Agreement without the prior written consent of the other party.

All notices or reports permitted or required under this Agreement shall be in writing and shall be delivered by personal delivery, electronic mail, facsimile transmission, or by certified or registered mail, return receipt requested, and shall be deemed given upon personal delivery, five (5) days after deposit in the mail, or upon acknowledgment of receipt of electronic transmission. Notices shall be sent to the addresses set forth at the end of this Agreement or such other address as either party may specify in writing.

Each of the parties agrees that the software programs of the other party contain valuable confidential information and each party agrees it will not modify, reverse engineer, decompile, create other works from, or disassemble any software programs contained in the Confidential Information of the other party without the prior written consent of the other party.

In Witness Whereof, the parties hereto have caused this Non-Disclosure Agreement to be executed as of the Effective Date.