EXHIBIT (e)(3)
NONDISCLOSURE AGREEMENT
THIS NONDISCLOSURE AGREEMENT (this "Agreement") is made by and between
CYPRESS COMMUNICATIONS, INC., a corporation organized under the laws of Delaware
("Cypress"), with a principal place of business located at 00 Xxxxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxx, Xxxxxxx 00000, Attention: Vice Chairman and General Counsel,
and Resurgence Communications, LLC, a corporation organized under the laws of
Georgia ("Company"), with a principal place of business located at 000 Xxxxxxxx
Xxxxx, Xxxxxxxx, Xxxxxxx 00000, Attention: Xxxxxxx X. XxXxxx, effective as of
November 19, 2001. The parties agree as follows:
1. Proposed Transaction Defined. Each party may receive from the
other party information of a non-public nature for use by such party and its
officers, directors, agents, employees and representatives, including financial
and legal advisers (collectively, "Representatives") in connection with
discussions between the parties regarding a possible business transaction (the
"Proposed Transaction").
2. Information Defined. The parties acknowledge that, in the
course of their discussions relating to the Proposed Transaction, each party may
receive certain private and proprietary information from or about the other
party or its affiliates, including, but not limited to, technical, financial or
business plans and models, names of customers or partners, proposed business
deals, reports, market projections, software programs, data or any other private
and proprietary information relating to the Proposed Transaction which may
include certain trade secrets ("Information"). The term "Information" as used
herein also includes: (i) the fact that the Information has been made available
to the receiving party; (ii) the fact that discussions are taking place
concerning the Proposed Transaction; and (iii) any of the terms, conditions or
other facts with respect to the Proposed Transaction or other related
transactions, including the status thereof. Any Information supplied by either
party to the other prior to the execution of this Agreement shall be subject to
the same treatment as the Information made available after the execution of this
Agreement.
3. Exclusions from Definition. The term "Information" as used
herein does not include any data or information; (a) which is already known to
the receiving party at the time it is disclosed to the receiving party; or (b)
which before being divulged by the receiving party; (i) has become generally
known to the public through no wrongful act of the receiving party; (ii) has
been rightfully received by the receiving party from a third party without
restriction on disclosure and without, to the knowledge of the receiving party,
a breach of an obligation of confidentiality running directly or indirectly to
the other party hereto; (iii) has been approved for release by a written
authorization by the other party hereto; (iv) is required to be disclosed by
operation of law pursuant to Section 6
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below; or (v) is independently developed by the receiving party without use,
directly or indirectly, of the Information received from the other party hereto.
4. Nondisclosure Obligation. Each party receiving any Information
shall keep such Information confidential and shall not disclose such
Information, in whole or in part, to any person other than its Representatives
who need to know such Information in connection with the Proposed Transaction,
except with the prior written consent of the other party hereto or as otherwise
permitted hereunder. Representatives shall be informed by the receiving party of
the confidential nature of the Information and shall be required by the
receiving party to agree to comply with the terms of this Agreement. The
Information shall be used by the receiving party solely for the purpose of
evaluating the Proposed Transaction, and shall not be otherwise used for the
receiving party's own benefit, or for any purpose detrimental to the disclosing
party. Each party shall be responsible for any breach by its Representatives of
the terms of this Agreement.
5. Standard of Protection. The party receiving any Information
shall use efforts commensurate with those that such party employs for the
protection of corresponding sensitive information of its own, and the receiving
party shall take all steps which are necessary and reasonable to protect such
Information.
6. Compliance with Legal Process. If the party receiving any
Information is required to (i) disclose the same to any government agency or
court of competent jurisdiction by written order, subpoena or decree, or (ii)
publicly disclose such Information in accordance with applicable federal or
state securities law or regulation, such party shall promptly notify the other
party prior to disclosure so that the other party may seek an appropriate
protective order, review and recommend changes to any such disclosure,
simultaneously file and/or disseminate a related disclosure or public statement,
and/or waive compliance with the terms of this Agreement. If, however, in the
opinion of counsel for the receiving party such party is nonetheless, in the
absence of such order or waiver, compelled to disclose such Information or else
stand liable for contempt, penalty or liability, then the receiving party may
disclose such Information without liability to the other party hereunder.
7. Ownership; Return of Information. No license to a party, under
any trademark, patent, copyright, trade secret, mask work protection right or
any other intellectual property right, is either granted or implied by the
disclosure of Information to such party. All Information (including tangible
copies and computerized or electronic versions and summaries thereof) shall
remain the property of the furnishing party. Within five (5) days following the
receipt of a written request referencing this Agreement, the receiving party
shall deliver to the furnishing party or destroy all tangible materials
containing or embodying the Information received from the furnishing party along
with any copies, reproductions, and summaries thereof, together with a
certificate executed by the receiving party certifying that all such materials
in the receiving party's possession have been delivered to the furnishing party
or destroyed. That portion of the
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Information which has been incorporated into analyses, compilations,
comparisons, studies or other documents prepared by the receiving party or its
Representatives shall be held by the receiving party and kept confidential as
provided above and shall not be used for any reason other than evaluating the
Proposed Transaction or shall be destroyed (together with written notice of
destruction to the furnishing party)
8. Remedies for Breach. Each party understands and agrees that
money damages would not be a sufficient remedy for any breach of this Agreement
and that the other party shall be entitled to seek injunctive or other equitable
relief to remedy or forestall any such breach or threatened breach. Such remedy
shall not be deemed to be the exclusive remedy for any breach of this Agreement,
but shall be in addition to all other rights and remedies available at law or in
equity.
9. No Representations or Further Obligations. Neither this
Agreement nor the disclosure or receipt of Information (including any
disclosures by the parties' investment bankers) shall constitute or imply any
promise or intention to enter into a transaction by either party. It is
understood that this Agreement does not obligate either party to enter into any
further agreements or to proceed with any possible relationship or other
transaction. Each party acknowledges and agrees that neither party (nor its
Representatives) is making any representation, warranty, assurance or guarantee
with respect to the accuracy or completeness of any Information (except to the
extent and only to such effect as shall be expressly set forth in an executed
and delivered definitive agreement between the parties to effect the Proposed
Transaction). Neither party nor its affiliates and any of their respective
officers, directors, employees, agents (including, without limitation, such
party's investment banker) or controlling persons within the meaning of Section
20 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
shall have any liability to the other party or any of its Representatives
relating to or arising from the use of the Information. Nothing in this
Agreement shall limit or restrict in any way either party's ability to pursue
transactions similar to the Proposed Transaction with other parties or to
terminate the discussions relating hereto.
10. Acknowledgement of U.S. Securities Laws Matters. Company
acknowledges that it is aware, and that it will advise its Representatives who
are informed as to the matters which are the subject of this Agreement, that
United States securities laws prohibit any person who has received from an
issuer material, non-public information concerning the matters which are the
subject of this Agreement from purchasing or selling securities of such issuer
or from communicating such information to any other person under circumstances
in which it is reasonably foreseeable that such person is likely to purchase or
sell such securities.
11. Conduct of Due Diligence. Each party agrees that (a) all
inquiries, requests for information and other communications with the other
party shall be made only through The Breckenridge Group, Inc., 000 Xxxx Xxxxx
Xxxxx Xxxx, Xxxxxxx, Xxxxxxx 00000, Attention: Xxxx XxXxxxx, with respect to
Cypress, and Xxxxxxx
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McGraw, or Xxxxxxx XxXxxxx, with respect to Company, and (b) it will not contact
the employees, customers or suppliers of the other party with respect to the
Proposed Transaction or for purpose of obtaining information for use in
evaluation of the Proposed Transaction.
13. Term; Termination. Unless otherwise provided in this
Agreement, the obligations hereunder shall survive for a period of two (2) years
after the date hereof. Either party may terminate the exchange of Information
under this Agreement at any time by written notice to the other. In any event,
however, the obligations of each party to maintain the confidentiality of the
Information constituting a trade secret under applicable law shall continue
indefinitely so long as such Information remains a trade secret.
14. No Waiver. No failure or delay by either party in exercising
any right, power or privilege hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege
hereunder.
15. Amendment. This Agreement may not be modified, supplemented or
amended orally, but only by a writing signed by both parties hereto.
16. Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of Georgia,
U.S.A., without regard to its choice of law provisions. Each party irrevocably
and unconditionally consents to submit to the exclusive jurisdiction of the
courts of State of Delaware and of the United States of America located in the
State of Delaware for any actions, suits or proceedings arising out of or
relating to this Agreement and the transactions contemplated hereby (and each
party agrees not to commence any action, suit or proceeding relating thereto
except in such courts), and further agree that service of any process, summons,
notice or document to your address set forth above shall be effective service of
process for any action, suit or proceeding brought against you in any such
court. Each party hereby irrevocably and unconditionally waives any objection to
the laying of venue of any action, suit or proceeding arising out of this
Agreement or the transactions contemplated hereby, in the courts of the State of
Delaware or the United States of America located in the State of Delaware, and
hereby further irrevocably and unconditionally waives and agrees not to plead or
claim in any such court that any such action, suit or proceeding brought in such
court has been brought in an inconvenient forum.
[Signatures appear on the following page.]
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IN WITNESS WHEREOF, the parties have executed and delivered this
Nondisclosure Agreement effective as of the date first written above.
Cypress: Company:
CYPRESS COMMUNICATIONS, INC. Resurgence Communications, LLC
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By: /s/ R. Xxxxxxx Xxxxx By: Xxxxxxx X. XxXxxx
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Name: R. Xxxxxxx Xxxxx Name: Xxxxxxx X. XxXxxx
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Title: Vice Chairman Title: President & COO
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