Legal Restraint Agreement

Legal Restraint Agreement

This Legal Restraint Agreement (the "Agreement") is made and entered into on this day of , by and between Party A: , having its principal place of business at ; and Party B: , having its principal place of business at .

Recitals

WHEREAS, Party A and Party B are parties to a business relationship pursuant to which each party will receive access to Confidential Information and customer relationships that have material business value; and

WHEREAS, the parties desire to protect legitimate business interests including trade secrets, confidential information, goodwill, and customer relationships by imposing reasonable restraints on competition and solicitation as set forth below; and

WHEREAS, Party B acknowledges that the restraints in this Agreement are supported by adequate consideration as described herein.

NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. Definitions

1.1 "Confidential Information" means all non-public information disclosed by a Disclosing Party to the Receiving Party, whether disclosed orally, visually or in writing, that relates to business plans, financial information, customer and supplier lists, technical data, trade secrets, and other proprietary information. Confidential Information does not include information that is (a) already known to the Receiving Party without restriction at the time of disclosure, (b) becomes generally available to the public through no wrongful act of the Receiving Party, or (c) rightfully received from a third party without restriction on disclosure.

1.2 "Restricted Business" means any business substantially similar to the products or services that Party A or Party B provided, marketed or developed during the twelve (12) months immediately preceding the Effective Date, or as otherwise defined by the parties herein.

2. Non-Competition

2.1 During the period beginning on the Effective Date and continuing for months thereafter (the "Restricted Period"), Party B shall not, directly or indirectly, engage in, own, manage, operate, finance, control, or participate in the ownership, management, operation, or control of any business that competes with the Restricted Business within the geographic scope defined as: .

2.2 The parties agree that the duration, geographic scope and activities restricted are reasonable in light of the parties' legitimate business interests and the consideration provided. If any court finds any provision in this Section 2 to be unenforceable as written, the parties agree that a court may reform such provision to the maximum extent permitted by law to effectuate the parties' intent.

3. Non-Solicitation

3.1 During the Restricted Period, Party B shall not, directly or indirectly, solicit or attempt to solicit (a) customers or clients of Party A with whom Party B had material contact during the twelve (12) months prior to the Effective Date, or (b) employees or independent contractors of Party A for purposes of encouraging them to terminate their relationship with Party A.

3.2 Exceptions: The following customers shall be excluded from the foregoing restriction (if any):

4. Confidentiality

4.1 Each Receiving Party shall hold Confidential Information in strict confidence and shall not disclose such information to any third party except to employees, advisors or agents who have a need to know and who are bound by confidentiality obligations no less restrictive than those contained herein.

4.2 The Receiving Party shall take all reasonable measures to protect the confidentiality of Confidential Information, including at least the same degree of care it uses to protect its own confidential information but in no event less than reasonable care.

5. Consideration

5.1 In consideration for the covenants herein, Party A shall provide to Party B the following consideration: .

5.2 If monetary consideration is provided, the amount is: $, paid in accordance with the parties' agreement.

6. Remedies and Enforcement

6.1 The parties acknowledge that a breach of the covenants contained in Sections 2, 3 or 4 would cause irreparable harm for which monetary damages may be an inadequate remedy. In the event of a breach or threatened breach, the non-breaching party shall be entitled to seek injunctive relief and specific performance, in addition to any other remedies available at law or in equity.

6.2 Liquidated Damages: The parties agree that if Party B breaches a material restriction hereunder, Party B shall pay liquidated damages in the amount of $, which the parties acknowledge is a reasonable estimate of actual damages and not a penalty.

7. Representations and Warranties

7.1 Each party represents and warrants to the other that it has the full right, power and authority to enter into and perform this Agreement, and that the person executing this Agreement on its behalf is duly authorized to do so.

8. Term and Termination

8.1 This Agreement shall commence on the Effective Date and shall continue in full force and effect for the Restricted Period, unless earlier terminated by mutual written agreement of the parties or as otherwise provided herein.

9. Notices

Notices to Party A:

Notices to Party B:

9.1 All notices required or permitted under this Agreement shall be in writing and shall be deemed given when delivered personally, sent by certified mail, return receipt requested, or delivered by a nationally recognized overnight courier service, to the addresses set forth above or such other address as a party may designate by notice.

10. Amendments; Waiver

10.1 This Agreement may be amended only by a written instrument signed by both parties. No waiver of any breach shall be effective unless in writing and signed by the party granting the waiver.

11. Severability

11.1 If any provision of this Agreement is held to be invalid, illegal or unenforceable by a court of competent jurisdiction, the remaining provisions shall continue in full force and effect. The parties agree that the court may reform the invalid provision to the minimum extent necessary to render it enforceable while preserving the parties' intent.

12. Governing Law

12.1 This Agreement shall be governed by and construed in accordance with the laws of the State of , without regard to conflicts of law principles.

13. Entire Agreement

13.1 This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations and discussions, whether oral or written.

14. Counterparts

14.1 This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Signatures transmitted by electronic means shall be deemed originals for all purposes.

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