EXHIBIT 2.5
MASTER CONFIDENTIAL DISCLOSURE AGREEMENT
This Master Confidential Disclosure Agreement (the "Agreement") is
effective as of ________, 2000 between Catalytica, Inc., a Delaware corporation
("Catalytica") and Catalytica Energy Systems, Inc., a Delaware corporation
("CESI").
WHEREAS, Catalytica has entered into that certain Agreement and Plan
of Merger, dated August 2, 2000, with Synotex Company, Inc. and Synotex
Acquisition Corporation (the "Merger Agreement") which contemplates, among other
things, the distribution by Catalytica to all its shareholders of the CESI
capital stock held by it and the execution and delivery of certain other
agreements in order to facilitate and provide for the foregoing; and
WHEREAS, Catalytica and CESI have entered into a Merger Separation
Agreement which provides for, among other things, confirmation of the transfer
from Catalytica to CESI of certain assets and liabilities, the public
distribution of CESI stock and the execution and delivery of certain other
agreements in order to facilitate and provide for the foregoing; and
WHEREAS, as part of the foregoing, the parties further desire to enter
into this Agreement to provide for the protection of their Confidential
Information.
NOW, THEREFORE, in consideration of the mutual promises of the
parties, and of good and valuable consideration, it is agreed by and between the
parties as follows:
ARTICLE 1
DEFINITIONS
For the purpose of this Agreement, the following capitalized terms
shall have the meaning specified herein:
1.1 "Ancillary Agreements" means the items and agreements
contemplated by the Merger Agreement, including without limitation, those
agreements listed in Schedule 1.6 of the Merger Agreement, the items and
agreements listed in Section 2.1 of the Master Separation Agreement and all
agreements and documents contemplated by such agreements.
1.2 Confidential Information.
(a) "Confidential Information" means business information, technical
data, know-how and other information which is not otherwise in the public
domain and of which the owner actively undertakes to restrict or control
the disclosure to Third Parties in a manner reasonably intended to maintain
its confidentiality, and which (i) the Disclosing Party disclosed to the
Receiving Party or the Receiving
Party had access to on or before the Separation Date, (ii) is the subject
of any Transaction Agreement and known to or in the possession of the
Receiving Party as of the Separation Date, or (iii) is disclosed to the
Receiving Party pursuant to any Transaction Agreement for a period of three
(3) years after the date of this Agreement. Confidential Information may
include information relating to, by way of example, research, products,
services, customers, markets, software, developments, inventions,
processes, designs, drawings, engineering, marketing or finances, and may
be in writing, disclosed orally or learned by inspection of computer
programming code, equipment or facilities.
(b) Confidential Information of Third Parties that is known to, in
the possession of or acquired by a Receiving Party pursuant to a
relationship with the Disclosing Party shall be deemed the Disclosing
Party's Confidential Information for purposes herein.
(c) Notwithstanding the foregoing provisions of this Section 1.2,
Confidential Information shall exclude information that: (i) was in the
Receiving Party's possession before receipt from the Disclosing Party and
obtained from a source other than the Disclosing Party and other than
through the prior relationship of the Disclosing Party and the Receiving
Party before the Separation Date; (ii) is or becomes a matter of public
knowledge through no fault of the Receiving Party; (iii) is rightfully
received by the Receiving Party from a Third Party without a duty of
confidentiality; (iv) is disclosed by the Disclosing Party to a Third Party
without a duty of confidentiality on the Third Party; (v) is independently
developed by the Receiving Party; or (vi) is disclosed by the Receiving
Party with the Disclosing Party's prior written approval.
1.3 "Disclosing Party" means the party owning or disclosing the
relevant Confidential Information including any subsidiary of such party.
1.4 "Master Separation Agreement" means that certain Master
Separation Agreement between Catalytica and CESI, entered into on the date
hereof.
1.5 "Person" means an individual, a partnership, a corporation, a
limited liability company, an association, a joint stock company, a trust, a
joint venture, an unincorporated organization, and a governmental entity or any
department, agency or political subdivision thereof.
1.6 "Receiving Party" means the non-owning party or recipient of the
relevant Confidential Information including any subsidiary of such party.
1.7 "Separation Date" shall have the meaning set forth in the Master
Separation Agreement.
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1.8 "Subsidiary" of any Person means a corporation or other
organization, whether incorporated or unincorporated, of which at least a
majority of the securities or interests having by the terms thereof ordinary
voting power to elect at least a majority of the board of directors or others
performing similar functions with respect to such corporation or other
organization is directly or indirectly owned or controlled by such Person or by
any one or more of its Subsidiaries, or by such Person and one or more of its
Subsidiaries; provided, however, that no Person that is not directly or
indirectly wholly-owned by any other Person shall be a Subsidiary of such other
Person unless such other Person controls, or has the right, power or ability to
control, that Person. For purposes of this Agreement, CESI shall be deemed not
to be a subsidiary of Catalytica.
1.9 "Third Party" means a Person other than Catalytica and its
Subsidiaries and CESI and its Subsidiaries.
1.10 "Transaction Agreements" mean the Merger Agreement, the Master
Separation Agreement and the Ancillary Agreements.
ARTICLE 2
CONFIDENTIALITY
2.1 Confidentiality and Non-Use Obligations. The Receiving Party
shall (i) protect the Confidential Information of the Disclosing Party by using
the same degree of care, but no less than a reasonable degree of care, to
prevent the unauthorized use, dissemination, or publication of the Confidential
Information as the Receiving Party uses to protect its own confidential
information of a like nature, (ii) not use such Confidential Information in
violation of any use restriction in any Transaction Agreement, (iii) not
disclose such Confidential Information to any Third Party, except as expressly
permitted under this Agreement, in the Transaction Agreements or in any other
agreements entered into between the parties in writing, without the prior
written consent of the Disclosing Party and (iv) take reasonable measures to
ensure that its directors, officers, employees, consultants and advisors comply
with (i), (ii) and (iii) above.
2.2 Disclosure to Sublicensees. The Receiving Party has the right to
disclose to its sublicensees permitted under a Transaction Agreement portions of
Confidential Information as reasonably necessary in the exercise of the
Receiving Party's sublicense rights under such Transaction Agreement, subject to
the sublicensee's agreement in writing to confidentiality and non-use terms at
least as protective of the Disclosing Party as the provisions of this Agreement.
2.3 Contract Manufacturers. The Receiving Party has the right to
disclose to its contract manufacturers permitted under any Transaction Agreement
portions of the Confidential Information as reasonably necessary in the exercise
of the Receiving Party's "have made" rights under any Transaction Agreement,
subject to the contract
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manufacturer's agreement in writing to confidentiality and non-use terms at
least as protective of the Disclosing Party as the provisions of this Agreement.
2.4 Residuals. Notwithstanding any other provision of this
Agreement, the Receiving Party shall be free, and the Disclosing Party hereby
grants to the Receiving Party, except as otherwise provided in this Section 2.4,
the right, to use or exploit for any purpose and without restriction the
Residuals resulting from access to or work with the Confidential Information of
the Disclosing Party. "Residuals" means information retained in the unaided
memory of an individual who has had access to Confidential Information. The
Receiving Party shall have no obligation to pay royalties for any use of
Residuals. However, this Section 2.4 does not grant the Receiving Party any
rights under any patents or copyrights of the Disclosing Party.
2.5 Compelled Disclosure. If the Receiving Party or any of its
respective Subsidiaries believes that it will be compelled by a court or other
authority to disclose Confidential Information of the Disclosing Party, it shall
(i) give the Disclosing Party prompt written notice so that the Disclosing Party
may take steps to oppose such disclosure and (ii) cooperate with the Disclosing
Party in its attempts to oppose such disclosure. If the Receiving Party complies
with the above, it shall not be prohibited from complying with such requirement
to disclose, but shall take all reasonable steps to make such disclosure subject
to a suitable protective order or otherwise prevent unrestricted or public
disclosure.
2.6 No Restriction on Disclosing Party. Nothing in this Agreement
shall restrict the Disclosing Party from using, disclosing, or disseminating its
own Confidential Information in any way.
2.7 No Restriction on Reassignment. This Agreement shall not
restrict reassignment of either party's employees to be an employee of the
other.
2.8 Third-Party Restrictions. Nothing in the Agreement supersedes
any restriction imposed by Third Parties on their Confidential Information, and
there is no obligation on the Disclosing Party to conform Third Party agreements
to the terms of this Agreement.
ARTICLE 3
WARRANTY DISCLAIMER
EACH PARTY ACKNOWLEDGES AND AGREES THAT ALL CONFIDENTIAL INFORMATION IS PROVIDED
ON AN "AS IS, WHERE IS" BASIS AND THAT NEITHER PARTY NOR ANY OF ITS SUBSIDIARIES
HAS MADE OR WILL MAKE ANY WARRANTY WHATSOEVER, EXPRESS, IMPLIED OR STATUTORY,
INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF
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MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, ENFORCEABILITY OR NON-
INFRINGEMENT.
ARTICLE 4
CONFIDENTIALITY OF AGREEMENT
Each party agrees that the terms and conditions of the Transaction
Agreements that have not been made publicly available shall be treated as
Confidential Information and that neither party will disclose such terms or
conditions to any Third Party without the prior written consent of the other
party, provided, however, that each party may disclose such terms and conditions
of such agreements marked as confidential:
(a) as required by any court or other governmental body (subject to
Section 2.5);
(b) as otherwise required by law (subject to Section 2.5);
(c) in confidence, to legal counsel of the parties, accountants, and
other professional advisors;
(d) in confidence to banks, investors and other financing sources and
their advisors;
(e) in connection with the enforcement of this Agreement or rights
under this Agreement; or
(f) in confidence, in connection with an actual or prospective merger
or acquisition or similar transaction.
ARTICLE 5
TERM AND TERMINATION
5.1 Term. This Agreement shall remain in full force and effect
unless and until terminated by the mutual written agreement of the parties.
5.2 Survival. Articles 2 (with respect to Confidential Information
acquired or disclosed prior to the date of termination), 3, 4, 6, 7 and 8 shall
survive any termination of this Agreement.
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ARTICLE 6
DISPUTE RESOLUTION
6.1 Mediation. If a dispute, controversy or claim ("Dispute") arises
between the parties relating to the interpretation or performance of this
Agreement or the grounds for the termination hereof, appropriate senior
executives (e.g., director or V.P. level) of each party who shall have the
authority to resolve the matter shall meet to attempt in good faith to negotiate
a resolution of the Dispute prior to pursuing other available remedies. The
initial meeting between the appropriate senior executives shall be referred to
herein as the "Dispute Resolution Commencement Date." Discussions and
correspondence relating to trying to resolve such Dispute shall be treated as
confidential information developed for the purpose of settlement and shall be
exempt from discovery or production and shall not be admissible. If the senior
executives are unable to resolve the Dispute within thirty (30) days from the
Dispute Resolution Commencement Date, and either party wishes to pursue its
rights relating to such Dispute, then the Dispute will be mediated by a mutually
acceptable mediator appointed pursuant to the mediation rules of JAMS/Endispute
within thirty (30) days after written notice by one party to the other demanding
non- binding mediation. Neither party may unreasonably withhold consent to the
selection of a mediator or the location of the mediation. Both parties will
share the costs of the mediation equally, except that each party shall bear its
own costs and expenses, including attorney's fees, witness fees, travel
expenses, and preparation costs. The parties may also agree to replace mediation
with some other form of non-binding or binding ADR.
6.2 Arbitration. Any Dispute which the parties cannot resolve through
mediation within ninety (90) days of the Dispute Resolution Commencement Date,
unless otherwise mutually agreed, shall be submitted to final and binding
arbitration under the then current Commercial Arbitration Rules of the American
Arbitration Association ("AAA"), by three (3) arbitrators in Santa Xxxxx County,
California. Such arbitrators shall be selected by the mutual agreement of the
parties or, failing such agreement, shall be selected according to the aforesaid
AAA rules. The arbitrators will be instructed to prepare and deliver a written,
reasoned opinion stating their decision within thirty (30) days of the
completion of the arbitration. The prevailing party in such arbitration shall be
entitled to expenses, including costs and reasonable attorneys' and other
professional fees, incurred in connection with the arbitration (but excluding
any costs and fees associated with prior negotiation or mediation). The decision
of the arbitrator shall be final and non-appealable and may be enforced in any
court of competent jurisdiction. The use of any ADR procedures will not be
construed under the doctrine of laches, waiver or estoppel to adversely affect
the rights of either party.
6.3 Court Action. Any Dispute regarding the following is not
required to be negotiated, mediated or arbitrated prior to seeking relief from a
court of competent jurisdiction: breach of any obligation of confidentiality;
infringement, misappropriation, or misuse of any intellectual property right;
any other claim where interim relief from the court
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is sought to prevent serious and irreparable injury to one of the parties or to
others. However, the parties to the Dispute shall make a good faith effort to
negotiate and mediate such Dispute, according to the above procedures, while
such court action is pending.
6.4 Continuity of Service and Performance. Unless otherwise agreed in
writing, the parties will continue to provide service and honor all other
commitments under this Agreement and each Ancillary Agreement during the course
of dispute resolution pursuant to the provisions of this Article 6 with respect
to all matters not subject to such dispute, controversy or claim.
ARTICLE 7
MISCELLANEOUS PROVISIONS
7.1 Export Restrictions. Both parties shall adhere to all applicable
laws, regulations and rules relating to the export of technical data, and shall
not export or reexport any technical data, any products received from Disclosing
Party, or the direct product of such technical data, to any proscribed country
listed in such applicable laws, regulations and rules unless properly
authorized.
7.2 No Implied Licenses. Nothing contained in this Agreement shall be
construed as conferring any rights by implication, estoppel or otherwise, under
any intellectual property right, other than the rights expressly granted in this
Agreement with respect to Confidential Information. Neither party is required
hereunder to furnish or disclose to the other any technical or other
information.
7.3 Infringement Suits. Neither party shall have any obligation
hereunder to institute any action or suit against Third Parties for
misappropriation of any of its Confidential Information or to defend any action
or suit brought by a Third Party that alleges infringement of any intellectual
property rights by the Receiving Party's authorized use of the Disclosing
Party's Confidential Information.
7.4 No Other Obligations. Neither party assumes any responsibilities
or obligations whatsoever, other than the responsibilities and obligations
expressly set forth in this agreement or a separate written agreement between
the parties.
7.5 Entire Agreement. This Agreement, the Merger Agreement, the
Master Separation Agreement and the other Ancillary Agreements and the Exhibits
and Schedules referenced or attached hereto and thereto constitute the entire
agreement between the parties with respect to the subject matter hereof and
thereof and shall supersede all prior written and oral and all contemporaneous
oral agreements and understandings with respect to the subject matter hereof and
thereof. Notwithstanding the foregoing, the parties agree that any agreements
entered into between them on or after the Separation Date for the
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protection of specific Confidential Information shall supersede the terms of
this Agreement with respect to such Confidential Information.
7.6 Governing Law. This Agreement shall be construed in accordance
with and all Disputes hereunder shall be governed by the laws of the State of
California, excluding its conflict of law rules. The Superior Court of Santa
Xxxxx County and/or the United States District Court for the Northern District
of California shall have jurisdiction and venue over all Disputes between the
parties that are permitted to be brought in a court of law pursuant to Section 6
above.
7.7 Interpretation. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
7.8 Notices. Notices, offers, requests or other communications
required or permitted to be given by either party pursuant to the terms of this
Agreement shall be given in writing to the respective parties to the following
addresses:
if to Catalytica:
Catalytica, Inc.
000 Xxxxxxxx Xxxxx
Xxxxxxxx Xxxx, Xxxxxxxxxx 00000-0000
Attention: President
Fax: (650) __________
if to CESI:
Catalytica Energy Systems, Inc.
000 Xxxxxxxx Xxxxx
Xxxxxxxx Xxxx, Xxxxxxxxxx 00000-0000
Attention: President
Fax: (650) __________
or to such other address as the party to whom notice is given may have
previously furnished to the other in writing as provided herein. Any notice
involving non-performance or renewal shall be sent by hand delivery, recognized
overnight courier or, within the United States, may also be sent via certified
mail, return receipt requested. All other notices may also be sent by fax,
confirmed by first class mail. All notices shall be deemed to have been given
and received on the earlier of actual delivery or three (3) days from the date
of postmark.
7.9 Nonassignability. Neither party may, directly or indirectly, in
whole or in part, whether by operation of law or otherwise, assign or transfer
this Agreement, without the other party's prior written consent, and any
attempted assignment, transfer or delegation without such prior written consent
shall be voidable at the sole option of such
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other party. Notwithstanding the foregoing, each party (or its permitted
successive assignees or transferees hereunder) may assign or transfer this
Agreement as a whole without consent to a Person that succeeds to all or
substantially all of the business or assets of such party as long as such Person
agrees to accept all the terms and conditions set forth herein. Without limiting
the foregoing, this Agreement will be binding upon and inure to the benefit of
the parties and their permitted successors and assigns.
7.10 Severability. If any term or other provision of this Agreement
or the Exhibits attached hereto is determined by a court, administrative agency
or arbitrator to be invalid, illegal or incapable of being enforced by any rule
of law or public policy, all other conditions and provisions of this Agreement
shall nevertheless remain in full force and effect so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner materially adverse to either party. Upon such determination that any term
or other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties as closely as possible in an
acceptable manner to the end that transactions contemplated hereby are fulfilled
to the fullest extent possible.
7.11 Failure or Indulgence Not Waiver; Remedies Cumulative. No
failure or delay on the part of either party hereto in the exercise of any right
hereunder shall impair such right or be construed to be a waiver of, or
acquiescence in, any breach of any representation, warranty or agreement herein,
nor shall any single or partial exercise of any such right preclude other or
further exercise thereof or of any other right. All rights and remedies existing
under this Agreement or the Exhibits attached hereto are cumulative to, and not
exclusive of, any rights or remedies otherwise available.
7.12 Amendment. No change or amendment will be made to this Agreement
except by an instrument in writing signed on behalf of each of the parties to
such agreement.
7.13 Counterparts. This Agreement, may be executed in counterparts,
each of which shall be deemed to be an original but all of which shall
constitute one and the same agreement.
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WHEREFORE, the parties have signed this Master Confidential Disclosure
Agreement effective as of the date first set forth above.
CATALYTICA, INC. CATALYTICA ENERGY SYSTEMS, INC.
By: _______________________________ By: _______________________________
Name: _____________________________ Name: _____________________________
Title: ____________________________ Title: ____________________________
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