FORM OF NON-DISCLOSURE AGREEMENT
EXHIBIT
10.18
FORM
OF NON-DISCLOSURE AGREEMENT
____________________
(Company Name), with its principal offices located at _____________
_____________________________________ (Company Address) (herein after called
"ABC"), is interested in entering into a business relationship (a "Possible
Transaction")
with
AeroGrow International, Inc., a Nevada corporation, with its headquarters
located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (herein after called
"AeroGrow"). In order to discuss and evaluate the Possible Transaction, (a)
ABC
has requested that disclose AeroGrow disclose to ABC certain confidential
and
proprietary data and other information of substantial value to AeroGrow,
and (b)
AeroGrow has requested that ABC disclose to AeroGrow certain confidential
and
proprietary data and other information of substantial value to ABC. This
information may be in both oral and written form. Each of ABC and AeroGrow
acknowledges that the other's disclosure of its confidential and proprietary
data and information to third parties will prejudice its ability to conduct
its
business successfully. Accordingly, each of ABC and AeroGrow agrees that
its
respective receipt and use of the other's confidential and proprietary data
and
information will be subject to the following terms and conditions:
1. As
used
in this Agreement, the following terms have the following meanings:
(a) "Affiliate"
means
(i) any other Person directly or indirectly (through one or more intermediaries)
controlling, controlled by or under common control with that Person; (ii)
any
other Person owning or controlling ten percent (10%) or more of the outstanding
voting securities or beneficial interests of that Person; or (iii) an officer,
director, partner or member, or a member of the immediate family of an officer,
director, partner or member, of that Person. For these purposes "control"
means
the possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership or voting securities, by contract or otherwise.
(b) "Confidential
Information"
means:
(i) all information, data and materials disclosed or made available to the
Receiving Party by the Disclosing Party in connection with a Possible
Transaction, including, without limitation, all trade secrets, inventions,
drawings, file data, test data, documentation, diagrams, specifications,
know
how, processes, formulas, models, flow charts, software in various stages
of
development, source codes, object codes, research and development procedures,
test results, marketing techniques and materials, marketing and development
plans, price lists, pricing policies, business plans, information relating
to
customers and/or suppliers' identities, characteristics and agreements,
financial information and projection, and employee files and (ii) all analyses,
compilations, studies, reports, records or other documents or materials which
contain, or are prepared on the basis of any such non-public information
and
which are either furnished to the Receiving Party or are prepared by or for
the
Receiving Party or any of its directors, officers, employees, members, managers,
agents, advisors or Affiliates. Notwithstanding the above, "Confidential
Information" does not include any information that (i) is or becomes public
knowledge otherwise than by the Receiving Party's act or omission; or (ii)
is or
becomes available to the Receiving Party without obligation of confidence,
of
which the Receiving Party was or should have been aware, from a source (other
than the Disclosing Party) having the legal right to disclose that information;
or (iii) is already in the possession of the Receiving Party in documented
form
without an obligation of confidence, of which the Receiving Party was or
should
have been aware, and was not received by the Receiving Party in anticipation
of
a Possible Transaction or as a result of a prior relationship with the
Disclosing Party.
(c) "Disclosing
Party"
means
the Person, either ABC or AeroGrow that is disclosing the Confidential
Information to the Receiving Party.
(d) "Person"
means
any entity, corporation, company, association, joint venture, partnership,
trust, limited liability company, limited liability partnership, real estate
investment trust, organization, individual (including personal representatives,
executors and heirs of a deceased individual), nation, state, government
(including agencies, departments, bureaus, boards, divisions and
instrumentalities thereof), court, tribunal, mediator, arbitrator, trustee,
receiver or liquidator.
(e) "Receiving
Party"
means
the Person, either ABC or AeroGrow, that is receiving the Confidential
Information from the Disclosing Party.
(f) "Representative"
of a
Person means any director, officer, employee, shareholder, partner, member,
Affiliate, agent or advisor of that Person, including, without limitation,
any
attorney, accountant, consultant, banker or financial advisor of that
Person.
2. The
Receiving Party will preserve as confidential all Confidential Information
which
the Receiving Party may obtain or prepare (a) during the course of discussions
between ABC and AeroGrow concerning a Possible Transaction, (b) during the
evaluation of a Possible Transaction and (c) during the course of any business
relationship which may be established between ABC and AeroGrow. Without the
prior written consent of the Disclosing Party, which may be given or withheld
by
the Disclosing Party in its sole and absolute discretion, the Receiving Party
will not (a) disclose or demonstrate any Confidential Information to any
other
Person nor give any other Person access thereto, nor (b) use any Confidential
Information except in evaluating a Possible Transaction, nor (c) disclose
to any
other Person either the fact that discussions or negotiations are taking
place
concerning a Possible Transaction, or the terms, conditions or status thereof
or
the fact that Confidential Information is being made available to the Receiving
Party; provided, however, that any such Confidential Information may be
disclosed to those of the Receiving Party's Representatives who (i) need
to know
the same for the sole purpose of evaluating a Possible Transaction and (ii)
agree to keep such Confidential Information confidential and to be bound
by the
terms of this Agreement to the same extent as if they were parties hereto.
If so
requested by the Disclosing Party, the Receiving Party will cause any such
Representatives to execute this Agreement so as to be personally bound hereby.
In any event, the Receiving Party will be responsible for any breach of this
Agreement by any of its Representatives, and the Receiving Party will, at
its
sole expense, take all reasonable measures (including, but not limited to,
court
proceedings) to restrain its Representatives from any prohibited or unauthorized
disclosure or use of the Confidential Information. Furthermore, no publicity
release or announcement concerning the discussions between ABC and AeroGrow,
this Agreement or a Possible Transaction will be issued, by either ABC or
AeroGrow without the advance written approval of the form and substance thereof
by the other. In the event that any such publicity release or announcement
is
required by law (in the opinion of either party's counsel), ABC or AeroGrow
will
consult with each other in advance and cooperate with respect to any required
press release or other disclosure.
-2-
3. If
the
Receiving Party or any of its Representatives is requested (by subpoena,
interrogatory, request for information or documents, civil investigate demand
or
other similar legal process) to disclose any of the Confidential Information
to
any other Person, the Receiving Party will provide the Disclosing Party with
prompt written notice of such request so that the Disclosing Party may seek
a
protective order or other appropriate remedy and/or waive compliance with
the
provisions of this Agreement. Thereafter, if the Receiving Party or any such
Representative is nevertheless, in the opinion of its counsel, legally compelled
to disclose the Confidential Information so requested or else stand liable
for
contempt or suffer other censure or penalty, the Receiving Party or that
Representative may, without liability hereunder, disclose to such other Person
only that portion of the Confidential Information which the Receiving Party's
counsel advises is legally required to be disclosed. The Receiving Party
will,
in addition, exercise its best efforts to preserve the confidentiality of
the
Confidential Information so "disclosed and cooperate with the Disclosing
Party
to obtain an appropriate protective order or other reliable assurance that
confidential treatment will be accorded to the Confidential Information so
disclosed.
4. The
Receiving Party will use at least the same degree of care to avoid the
publication, disclosure, reproduction or other dissemination of the Confidential
Information as the Receiving Party employs with respect to its own valuable,
proprietary information which it protects from unauthorized publication,
disclosure, reproduction or other dissemination, but no less than a reasonable
degree of care.
5. The
Receiving Party will not conduct any inquiries regarding the Confidential
Information or a Possible Transaction with any of the Disclosing Party's
stockholders, officers, members, managers, directors, employees, affiliates,
suppliers, proposed business partners or customers or with others having
business relationships with the Disclosing Party except through Representatives
of the Disclosing Party designated in writing by the Disclosing Party from
time
to time.
6. All
documents, drawings, records, data bases, programs and other physical media
of
expression incorporating or containing any Confidential Information which
the
Disclosing Party furnishes to the Receiving Party are acknowledged to be
the
property of the Disclosing Party and will be promptly surrendered to the
Disclosing Party upon the expiration or termination of the discussions between
ABC and AeroGrow or any business relationship which may be established between
ABC and AeroGrow. In addition, except to the extent the Receiving Party is
advised by counsel that such action is prohibited by law, the Receiving Party
will also destroy all copies, summaries and notes thereof made by the Receiving
Party and all analyses, compilations, studies, reports or other documents
or
materials which are prepared by the Receiving Party or its advisors and which
contain or reflect any Confidential Information which the Disclosing Party
furnishes to the Receiving Party. After such expiration or termination the
Receiving Party will make no further use of any of these materials, and if
so
requested by the Disclosing Party, a duly authorized officer of the Receiving
Party will deliver to the Disclosing Party a certificate indicating that
the
requirements of the immediately preceding two sentences have been satisfied
in
full. The foregoing will apply regardless of the reasons for or circumstances
surrounding such expiration or termination.
-3-
7. Except
as
otherwise provided in any binding agreement between ABC and AeroGrow, all
designs, methods, processes, developments, ideas and/or inventions directly
related to, or usable in, the Disclosing Party's business which the Receiving
Party conceives, develops or reduces to practice, or causes to be conceived,
developed or reduced to practice, as a result of the Receiving Party's access
to
the Confidential Information will be the Disclosing Party's sole property.
Upon
demand and without any further consideration the Receiving Party will confirm
such ownership by executing assignments of all of the Receiving Party's rights
therein to the Disclosing Party.
8. The
Receiving Party understands that the Disclosing Party makes no representations
or warranties as to the accuracy or completeness of any Confidential Information
disclosed to the Receiving Party, and the Receiving Party agrees that neither
the Disclosing Party nor any of its officers, directors, stockholders, members,
managers, employees, agents or attorneys or controlling Persons within the
meaning of Section 20 of the Securities Exchange Act of 1934 will have any
liability to the Receiving Party arising from the Receiving Party's use of
the
Confidential Information, except if the Disclosing Party is held to be in
breach
of this Agreement.
9. The
Receiving Party agrees that money damages will not be a sufficient remedy
for
any breach of this Agreement by the Receiving Party or any of its
Representatives and that in addition to all other remedies which may be
available, the Disclosing Party will be entitled to seek specific performance
and injunctive or other equitable relied without bond, as a remedy for any
such
breach or threatened breach.
10. To
the
fullest extent permitted by applicable law, rule or regulation, all of the
covenants and agreements contained in this Agreement will survive the
termination of any discussions between ABC and AeroGrow or the termination
or
expiration of any business relationship which may hereafter be established
between ABC and AeroGrow, and will also survive any definitive agreements
entered into by ABC and AeroGrow, in each such case for a period of three
(3)
years from the date hereof, unless and only to the extent that such definitive
agreements expressly supersede the covenants and agreements contained herein;
provided, however, that the provisions of this Agreement relating to the
preservation of the confidentiality of the Confidential Information and each
party's obligation to reimburse the other for all costs incurred by the other
in
connection with the successful enforcement of this Agreement as to such matters
will, in any event, survive for so long as the Confidential Information remains
confidential.
11. This
Agreement supersedes all previous agreements, written or oral, relating to
the
above subject matter, and may be modified only by a written instrument duly
executed by ABC and AeroGrow.
12. In
the
event of any litigation between ABC and AeroGrow in connection with this
Agreement, the unsuccessful party to such litigation will pay to the successful
party therein all reasonable costs and expenses, including but not limited
to
reasonable attorneys' fees incurred therein by such successful party, which
costs, expenses and attorneys' fees shall be included as a part of any judgment
rendered in such action in addition to any other relief to which the successful
party may be entitled.
-4-
13. All
clauses and covenants contained in this Agreement are severable and in the
event
any of them is held to be invalid by any court, this Agreement will be
interpreted as if such invalid clauses and covenants were not contained
herein.
14. This
Agreement will be construed according to the laws of the State of Colorado,
without regard to its principles concerning conflicts of law. Any suit brought
hereon must be brought in the state or federal courts sitting in the County
of
Denver, Colorado. ABC and AeroGrow hereby waive any claim or defense that
such
forum is not convenient or proper.
ACKNOWLEDGED
AND AGREED
AS
OF
_______________:
ACKNOWLEDGED
AND AGREED
AS
OF
_______________, 20____:
▇.
▇▇▇▇▇▇▇▇▇, VP
-5-