CONFIDENTIALITY AGREEMENT
 

THIS CONFIDENTIALITY AGREEMENT (this "Agreement") is entered into on day-month-year, by and between XYZ Corporation, an individual or corporation, herein called the "Disclosing Party" and Comtech Electronics, Inc, a Florida corporation, herein called "COMTECH".

INTRODUCTION

WHEREAS, Disclosing Party possesses certain confidential proprietary information; and WHEREAS, in connection with the pursuit, evaluation and/or feasibility of a business relationship, and/or the consummation of a transaction between COMTECH and Disclosing Party (collectively, the "Business Purposes"), confidential proprietary information of Disclosing Party may become available to COMTECH. WHEREAS, Disclosing Party desires to prevent the unauthorized use and disclosure of its confidential proprietary information. NOW THEREFORE, in consideration of these premises and for other good and valuable consideration, receipt of which is hereby acknowledged, the parties agree as follows:

I. "Confidential Information"

For purposes of this Agreement, Confidential Information shall mean all strategic and development plans, financial condition, business plans, co-developer identities, data, business records, customer lists, project records, market reports, employee lists and business manuals, policies and procedures, information relating to processes, technologies or theory and all other information which may be disclosed by Disclosing Party or to which COMTECH may be provided access by Disclosing Party or others in accordance with this Agreement, or which is generated as a result of or in connection with the Business Purposes, which is not generally available to the public.

II. Nondisclosure Obligations

COMTECH promises and agrees to receive and hold the Confidential Information in confidence. Without limiting the generality of the foregoing, COMTECH further promises and agrees:

  1. To protect and safeguard the Confidential Information against unauthorized use, publication or disclosure;
  2. Not to use any of the Confidential Information except for the Business Purposes.
  3. Not to, directly or indirectly, in any way, reveal, report, publish, disclose, transfer or otherwise use any of the Confidential Information except as specifically authorized by Disclosing Party in accordance with this Confidentiality Agreement.
  4. Not to use any Confidential Information to unfairly compete or obtain unfair advantage vis a vis Disclosing Party in any commercial activity which may be comparable to the commercial activity contemplated by the parties in connection with the Business Purposes.
  5. To restrict access to the Confidential Information to those of its officers, directors, and employees who clearly need such access to carry out the Business Purposes.
  6. To advise each of the persons to whom it provides access to any of the Confidential Information, that such persons are strictly prohibited from making any use, publishing or otherwise disclosing to others, or permitting others to use for their benefit or to the detriment of Disclosing Party, any of the Confidential Information, and, upon Request of Disclosing Party, to provide Disclosing Party with a copy of a written agreement to that effect signed by such persons.
  7. To comply with any other reasonable security measures requested in writing by Disclosing Party.

III. Exceptions

The confidentiality obligations hereunder shall not apply to Confidential Information which:

  1. Is, or later becomes, public knowledge other than by breach of the provisions of this Agreement; or
  2. Is in the possession of COMTECH with the full right to disclose prior to its receipt from Disclosing Party, as evidenced by written records; or
  3. Is independently received by COMTECH from a third party, with no restrictions on disclosure.

IV. Return of Confidential Information

COMTECH agrees, upon termination of the Business Purposes or upon the written request of Disclosing Party, whichever is earlier, to promptly deliver to Disclosing Party all records, notes, and other written, printed, or tangible materials in the possession of COMTECH, embodying or pertaining to the Confidential Information.

V. No Right to Confidential Information

  1. COMTECH hereby agrees and acknowledges that no license, either express or implied, is hereby granted to COMTECH by Disclosing Party to use any of the Confidential Information.
  2. COMTECH further agrees that all inventions, improvements, copyrightable works and designs relating to machines, methods, compositions, or products of Disclosing Party directly resulting from or relating to the Confidential Information and the right to market, use, license and franchise the Confidential Information or the ideas, concepts, methods or practices embodied therein shall be the exclusive property of Disclosing Party, and COMTECH has no right or title thereto.

VI. No Solicitation of Employees

COMTECH agrees that it will not, for a period of five (5) years from the date of this Agreement, initiate contact with Disclosing Party's employees in order to solicit, entice or induce any employee of Disclosing Party to terminate an employment relationship with Disclosing Party to accept employment with COMTECH.

VII. Losses

COMTECH agrees to indemnify Disclosing Party against any and all losses, damages, claims, or expenses incurred or suffered by Disclosing Party as a result of COMTECH's breach of this Agreement.

VIII. Term and Termination

This Agreement shall commence on the date first written above. COMTECH's right to use the Confidential Information in connection with the Business Purposes shall continue in effect until March 16, 2000, or until Disclosing Party provides COMTECH with written notice of termination of such right, whichever is earlier. Notwithstanding the foregoing, COMTECH's obligations with respect to the Confidential Information hereunder shall continue in full force and effect until further notice from Disclosing Party.

IX. Remedies

COMTECH understands and acknowledges that any disclosure or misappropriation of any of the Confidential Information in violation of this Agreement may cause Disclosing Party irreparable harm, the amount of which may be difficult to ascertain and, therefore, agrees that Disclosing Party shall have the right to apply to a court of competent jurisdiction for an order restraining any such further disclosure or misappropriation and for such other relief as Disclosing Party shall deem appropriate. Such right of Disclosing Party shall be in addition to Remedies otherwise available to the Disclosing Party at law or in equity.

X. Successors and Assigns

COMTECH shall have no right to assign its rights under this Agreement, whether expressly or by operation of law, without the written consent of Disclosing Party. This Agreement and COMTECH's obligations hereunder shall be binding on Representatives, permitted assigns, and successors of COMTECH and shall inure to the benefit of Representatives, assigns and successors of Disclosing Party.

XI. Governing Law

This Agreement shall be governed by and construed in accordance with the laws of the State of Florida.

XII. Attorneys' Fees

If any action at law or in equity is brought to enforce or interpret the provisions of this Agreement, the prevailing party in such action shall be entitled to reasonable attorneys' fees.

XIII. Entire Agreement

This Agreement constitutes the sole understanding of the parties about this subject matter and may not be amended or modified except in writing signed by each of the parties to the Agreement.

COMTECH ELECTRONICS, INC

By: __________________________________ (Officer of Corporation)

Date: ______________________