Business Escape Hatch Document

BUSINESS ESCAPE HATCH DOCUMENT

This Business Escape Hatch Document (the "Agreement") is entered into by the parties identified below for the purpose of establishing the conditions, procedures and consequences under which one or both parties may effect an orderly withdrawal, termination or restructuring of the business relationship without prejudice to remedies for prior breach.

Client Name: & Provider Name:

Effective Date:

RECITALS

WHEREAS, the Client engages the Provider to perform the services set forth herein and the parties wish to define an agreed mechanism—the "Escape Hatch"—by which the relationship may be suspended, restructured or terminated upon the occurrence of specified triggers; and

WHEREAS, the parties intend that the Escape Hatch provide for notice, cure periods, orderly wind-down obligations, allocation of outstanding payments and protection of confidential information so as to reduce transaction costs and business disruption; and

WHEREAS, the parties desire that the terms set forth below shall govern any exercise of the Escape Hatch and shall survive termination of other agreements between the parties to the extent necessary to effect an orderly wind-down.

SCOPE OF WORK

ESCAPE HATCH TRIGGERS AND PROCEDURE

The Escape Hatch may be invoked upon the occurrence of any of the following events. Select all applicable triggers and specify required notice and cure periods below.

PAYMENT TERMS

The parties agree the Provider's compensation for services performed under this Agreement shall be as follows.

In the event the Escape Hatch is invoked and not cured within the applicable cure period, payments for work properly performed and accepted through the termination date shall be prorated and paid within days of final accounting, subject to set-off for amounts owing to the non-invoking party.

TERM AND TERMINATION

This Agreement shall commence on the Effective Date and continue until terminated pursuant to its terms. Specify the expected term if any:

CONFIDENTIALITY

Each party shall treat as confidential all non-public information disclosed by the other party in connection with this Agreement. Confidential information shall not include information that is (i) already known to the receiving party without obligation of confidentiality; (ii) independently developed; (iii) rightfully received from a third party without restriction; or (iv) required to be disclosed by applicable law or a valid order of a court or regulatory authority, provided the disclosing party is given prompt notice to seek protective relief.

CONSEQUENCES AND WIND-DOWN

Upon valid invocation of the Escape Hatch that is not cured within the applicable cure period, the invoking or non-breaching party shall have the right to:

1. Require immediate cessation of specified activities and deliver an orderly wind-down plan;
2. Require return or certified destruction of confidential materials and any proprietary property; and
3. Seek prorated payment for accepted work, reimbursement for documented transition costs and any other remedies available at law or in equity, subject to any agreed set-offs.

GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the state of without regard to conflict-of-law principles. Venue for any action arising under this Agreement shall be in the state and federal courts located in that state, and the parties waive any objection to such forum.

DISPUTE RESOLUTION

Prior to initiating litigation, the parties agree to attempt in good faith to resolve disputes arising under this Agreement through escalation to senior management and then through non-binding mediation. Nothing in this clause shall prevent a party from seeking injunctive or other equitable relief to protect intellectual property or confidential information.

ENTIRE AGREEMENT AND AMENDMENT

This Agreement, together with any statements of work or annexes executed by the parties and incorporated by reference, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, proposals and understandings, whether written or oral. No amendment or waiver of any provision of this Agreement will be effective unless in writing and signed by authorized representatives of both parties.

REPRESENTATIONS; AUTHORITY

Each party represents and warrants that it has the right and authority to enter into this Agreement and to perform its obligations hereunder, and that the execution and performance of this Agreement will not violate any applicable law or contractual obligation.

NOTICES

All notices required or permitted under this Agreement shall be in writing and delivered to the addresses set forth below or as otherwise specified in writing by the parties. Notices are effective upon personal delivery, confirmed delivery by overnight carrier, or three (3) days after deposit in U.S. mail by certified mail, return receipt requested.

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