| 3. |
You and your Representatives (a) shall not (except as required by Law but only after compliance with paragraph 6 below or with the Company’s prior written consent) disclose any Confidential Information in any manner whatsoever, and (b)
shall use the Confidential Information solely for the purpose of evaluating, negotiating and proposing a Transaction; provided, however, you may disclose
the Confidential Information to your Representatives who (i) need to know the Confidential Information for the purpose of evaluating, negotiating or proposing a Transaction, (ii) are informed by you of the confidential nature of the
Confidential Information and (iii) are obligated to maintain the confidentiality of the Confidential Information and act in accordance with the terms of this Agreement applicable to your Representatives. You will direct your Representatives
to observe the terms of this Agreement, and you will be responsible for any breach by your Representatives of the provisions of this Agreement applicable to your Representatives.
|
| 4. |
You understand that some Confidential Information may be deemed competitively sensitive and may be designated for review solely by your outside advisors or by a limited number or category of your employees designated between us in
writing, and you and your Representatives agree to abide by such designation.
|
| 5. |
In addition, without the prior written consent of the Company, you and your Representatives agree to treat confidentially and will not disclose to any person (except as required by Law but only after compliance with paragraph 6 below):
(a) the fact that investigations, discussions or negotiations are taking place or have taken place concerning a Transaction; (b) any of the terms, conditions or other facts with respect to any such possible Transaction, including the status
thereof or either party’s consideration of a Transaction; (c) that the parties or any of their respective affiliates are or have been considering or reviewing a transaction involving or relating to the other party; or (d) that this
Agreement exists or that Confidential Information has been requested or made available to you or your Representatives ((a) through (d) collectively, the “Transaction Information”),
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| 6. |
In the event that you or any of your Representatives are legally required to disclose all or any part of the information contained in the Confidential Information or Transaction Information under the terms of law, rule, regulation, legal
process, a subpoena or order issued by a court or governmental or regulatory body of competent jurisdiction (collectively, “Law”), you and your Representatives agree to, except to the extent
prohibited by Law, promptly notify (email to suffice) the Company of the existence, terms and circumstances surrounding such requirement so that it may seek an appropriate protective order or waive your compliance with the provisions of
this Agreement (and, if the Company seeks such an order, to provide such cooperation as the Company shall reasonably request). In any such case, you and your Representatives agree to reasonably cooperate with the Company and use
commercially reasonable efforts to avoid or minimize the required disclosure or obtain such protective order or other relief. If, failing the entry of a protective order or the receipt of a waiver hereunder, the disclosure of such
information is required upon the advice of your or your Representatives’ legal counsel, as applicable, you and your Representatives will exercise commercially reasonable efforts to obtain an order or other reliable assurance that
confidential treatment will be accorded to such of the disclosed information, and you and your Representatives shall then disclose only that portion of the Confidential Information or Transaction Information that is legally required to be
disclosed. Notwithstanding the foregoing, no notice or further action shall be required in respect of disclosure of Confidential Information (or provision of access thereto) to regulatory authorities or self-regulatory organizations having
authority over you and your Representatives in connection with a routine regulatory examination or pursuant to statutory requirements that are not targeted at the Company, the possible Transaction or the Confidential Information.
|
| 7. |
You hereby acknowledge that you are aware, and that you will advise your Representatives who are informed or, to your knowledge, become aware of the matters that are the subject of this Agreement, that the United States securities laws
may prohibit any person who has received from an issuer material, non-public information 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.
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| 8. |
You acknowledge and agree that, without the prior written consent of the Company, no person who is a potential principal, co-investor, co-bidder or equity or debt financing source with respect to a possible Transaction (including
potential financing sources contemplating a rollover of already-owned Company debt or equity in connection with any proposed Transaction), in each case, that is not controlled by or under common control with you, shall be considered your
Representative for any purpose hereunder. Without the Company’s prior written consent, you agree that you will not, directly or indirectly, knowingly solicit, coordinate with or otherwise partner with any other person with respect to
participating in the Transaction as a principal, co-investor, co-bidder or equity or debt financing source or enter into any agreement, arrangement or understanding with any other Person regarding such a Transaction, provided, that you may
retain an exclusive team at any such debt financing source (after the debt financing source has been approved by the Company). You further agree that you will not, without the prior written consent of the Company, directly or indirectly,
enter into any agreement, arrangement or understanding with any person that has or would have the effect of requiring such person to provide you or any of your affiliates or related parties with financing or other potential sources of
capital on an exclusive basis in connection with a possible Transaction.
|
| 9. |
You understand that neither the Company nor any of its Representatives have made or make any express or implied representation or warranty as to the accuracy or completeness of the Confidential Information. Only those representations or
warranties that are made in any definitive agreement with respect to any Transaction, when, as, and if it is executed and delivered, and subject to such limitations and restrictions as may be specified in such definitive agreement, will
have any legal effect.
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| 10. |
You also agree that neither the Company nor its Representatives shall have any liability to you or your Representatives or equityholders on any basis (including, without limitation, in contract, tort, under federal or state securities
laws or otherwise), and neither you nor your Representatives will make any claims whatsoever against the Company or its Representatives in connection with: (a) any written or oral expression made by or on behalf of the Company with respect
to a Transaction; (b) your or your Representatives participation in evaluating a possible Transaction; (c) your or your Representatives’ review of or use or content of the Confidential Information or any errors therein or omissions
therefrom; or (d) any action or omission by you or your Representatives in reliance on the Confidential Information, except, in each case, as may be permitted by the express terms of any definitive agreement entered into in respect of a
Transaction.
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| 11. |
At any time upon the request of the Company or any of its Representatives, you and your Representatives shall promptly, at your election, either (a) redeliver to the Company all Confidential Information or (b) destroy all such
Confidential Information then in your or your Representatives’ possession, including, without limitation, all written or electronic data developed or derived from the Confidential Information. All redelivery or destruction pursuant to this
paragraph 10 shall be confirmed in writing to the Company (which may be via email), upon the request of the Company. The obligation to return or destroy Confidential Information shall not cover electronic files created in the ordinary
course of business during automatic system back-up procedures pursuant to its electronic record retention and destruction practices that apply to its own general electronic files and information so long as such electronic files are (i)
maintained only on centralized storage servers (and not on personal computers or devices), (ii) not accessible by any of its personnel (other than its information technology specialists), and (iii) are not otherwise accessed subsequently
except with the written consent of the Company or as required by law, rule, regulation, bona fide compliance policy or legal process. Such retained copies of Confidential Information shall remain subject to the confidentiality and non-use
obligations herein; provided, that, such materials referenced in this sentence shall remain subject to the confidentiality and use obligations of this Agreement. The return or destruction of
Confidential Information notwithstanding, you and your Representatives shall continue to be bound by the obligations hereunder.
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| 12. |
You agree that unless and until any definitive agreement with respect to any Transaction has been executed and delivered by the parties, neither of the parties nor any of their affiliates will be under any legal obligation of any kind
whatsoever with respect to such a Transaction by virtue of this or any written or oral expression with respect to such Transaction by any of its directors, officers, employees, agents or any other Representatives, except for the matters
specifically agreed in this Agreement. No contract or agreement providing for a Transaction shall be deemed to exist unless and until a definitive agreement has been executed and delivered by each of the parties thereto. You further
acknowledge and agree that (a) the Company shall have no obligation to authorize or pursue any Transaction, (b) the Company has not, as of the date hereof, authorized or made any decision to pursue or engage in any such Transaction and (c)
the Company reserves the right, in its sole and absolute discretion and without giving any reason therefor, to reject all proposals and to terminate discussions and negotiations, in each case at any time. For purposes of this Agreement, the
term “definitive agreement” does not include an executed letter of intent or any other preliminary written agreement, nor does it include any written or oral offer or bid or any written or oral acceptance thereof. This Agreement does not
constitute or create any obligation of the Company to provide any Confidential Information or other information to you, but merely defines the rights, duties and obligations of the parties with respect to Confidential Information to the
extent it may be disclosed or made available. Under no circumstances is the Company obligated to disclose or make available any information, including any Confidential Information that the Company in its sole discretion determines not to
disclose.
|
| 13. |
It is understood and agreed that the Company will arrange for appropriate contacts for due diligence and other purposes. Accordingly, neither you nor any of your Representatives will initiate or cause to be initiated any (a)
communication concerning the Confidential Information, (b) requests for meetings with management in connection with a Transaction or (c) any other communication relating to a Transaction with any person (other than those Representatives of
the Company identified to you in writing (which may be via email) for such purposes), provided that the foregoing shall not restrict contacts or discussions in the ordinary course of business or consistent with past practice (but not in
connection with the possible Transaction).
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| 14. |
Without the Company’s prior written consent, you also agree that, for a period of one year from the date of this Agreement, you and your Representatives (acting at your direction or on your behalf) shall not, directly or indirectly,
solicit for purposes of employment, offer to hire, hire, or enter into any employment contract with, any (x) any executive officer of the Company subsidiaries or (y) any other senior management or technical employee of the Company or any of
its subsidiaries who became known to you in connection with the Transaction or with whom you had contact in connection with the Transaction, or otherwise solicit, induce or otherwise encourage any such person to discontinue or refrain from
entering into any employment relationship (contractual or otherwise) with the Company (other than (a) solicitation through, or hiring that results from, general advertising or other general solicitation not targeted to the employees of the
Company or is referred by an employment agency, so long as the advertisement or agency search was not directed towards any such employee or group of employees of the Company, (b) solicitation with respect to, or hiring, any person whose
employment has been terminated by the Company for a period of at least three months or (c) hiring any person that independently approaches you without any direct or indirect solicitation on your part).
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| 15. |
You agree that, for a period of twelve (12) months from the date of this Agreement, unless specifically invited in writing by the Company, neither you nor your Representatives (acting on your behalf or direction) will in any manner,
directly or indirectly: (1) effect or seek, offer or propose (whether publicly or otherwise) to effect, participate in, facilitate or encourage any other person to effect or seek, offer or propose (whether publicly or otherwise) to effect
or participate in, (a) any acquisition of any securities (or beneficial ownership thereof), or rights or options to acquire any securities (or beneficial ownership thereof), or any assets, indebtedness or businesses of the Company, (b) any
tender offer or exchange offer, merger or other business combination involving the Company or any of its assets, (c) any recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction with respect to the
Company, or (d) any “solicitation” of “proxies” (as such terms are used in the proxy rules of the Securities Exchange Act of 1934, as amended (the “1934 Act”)) or consents to vote any securities of
the Company, including soliciting consents or taking any other action with respect to the calling of a special meeting of the Company’s shareholders; (2) form, join or in any way participate in a “group” (as defined under the 1934 Act) with
respect to the Company; (3) otherwise act, alone or in concert with others, to seek representation on or to control or influence the management, Board of Directors or policies of the Company or to obtain representation on the Board of
Directors of the Company; (4) disclose or direct any person to disclose, any intention, plan or arrangement inconsistent with the foregoing; (5) take any action that could reasonably be expected to result in a request by a court of
competent jurisdiction or by a governmental body to disclose, or could cause or require you or the Company to disclose or make a public announcement regarding, any Transaction Information or all or any part of the information contained in
the Confidential Information or any matter of the types set forth in this paragraph; or (6) advise, assist or encourage or direct any person to advise, assist or encourage any other persons in connection with any of the foregoing; provided that, nothing in the foregoing shall restrict you from confidentially communicating to the Company’s board of directors (or an applicable committee thereof) or chief executive officer any
non-public proposals regarding a possible Transaction in such a manner as would not reasonably be expected to require public disclosure thereof under any Law applicable to the Company or its Representatives or to Transom or its
Representatives. Despite the foregoing, each of the restrictions contained in the immediately preceding sentence shall lapse at such time as the Company publicly announces the entry into a definitive agreement with any third party with
respect to a merger, sale of assets or securities (including a tender offer or exchange offer) or other business combination as a result of which such third party would succeed to or acquire all or substantially all of the voting securities
or assets of the Company and its affiliates; provided that such restrictions shall automatically be reinstated from and after such time, if any, that the Company publicly announces that such
definitive agreement with such third party has been terminated.
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| 16. |
You acknowledge that the Company may be entitled to the protections of the attorney work-product doctrine, attorney-client privilege or similar protections or privileges with respect to portions of the Confidential Information. The
Company is not waiving, and will not be deemed to have waived or diminished, any of its attorney work-product protections, attorney-client privileges or similar protections or privileges as a result of the disclosure of such Confidential
Information pursuant to this Agreement. The parties (a) share a common legal and commercial interest in such Confidential Information, (b) are or may become joint defendants in proceedings to which such Confidential Information relates and
(c) intend that such protections and privileges remain intact should either party become subject to any actual or threatened proceeding to which such Confidential Information relates.
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| 17. |
It is further understood and agreed that no failure or delay by a party in exercising any right, power or privilege under this Agreement 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 right, power or privilege hereunder. No provision of this Agreement can be waived, amended or otherwise modified except by means of a written instrument that is validly executed on
behalf of both of the parties and that refers specifically to the particular provision or provisions being waived, amended or otherwise modified; provided, that this Agreement shall not be
subsequently limited or amended by any “clickthrough” agreement relating to the confidentiality of the Confidential Information agreed to by you or your Representatives in connection with your or their access to any data site maintained in
connection with a Transaction.
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| 18. |
Parties hereto agree that the non-breaching party may be irreparably injured by a breach of this Agreement and that money damages may be an inadequate remedy for an actual or threatened breach of this Agreement because of the difficulty
of ascertaining the amount of damages that may be suffered in the event that this Agreement is breached. Therefore, parties agree to the seeking of specific performance of this Agreement and injunctive or other equitable relief in favor of
the injured party as a remedy for any such breach. Such remedy shall not be deemed to be the exclusive remedy of the injured party in the event that this Agreement is breached, but shall be in addition to all other remedies available at law
or equity.
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| 19. |
The Company acknowledges that certain directors, officers, and employees who serve on the board of directors (or similar governing body) of one or more of your affiliates or portfolio companies may also serve as your representative in
another position or role (a “Dual Representative”) and no such affiliates or portfolio companies will be deemed to have received such Confidential Information solely as a result of such dual role of
any such Dual Representative, provided that such Dual Representative shall not have directly or indirectly disclosed any Confidential Information to such affiliate or portfolio company.
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| 20. |
The Company acknowledges that you are in the investment business and that you and your affiliates may now or in the future evaluate, invest in (directly or indirectly, including providing financing to) or do business with competitors or
potential competitors of the Company, or entities engaged in business similar to or the same as the Company, and, assuming our compliance with the terms of this Agreement, that neither the execution of this Agreement nor receipt of the
Confidential Information is intended to or shall restrict or preclude such activities.
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| 21. |
No party may assign this Agreement other than with the prior written consent of the other party. This Agreement shall inure to the benefit of and be binding upon the parties and their respective successors and assigns. This Agreement
contains the entire agreement between the parties concerning the subject matter hereof and supersedes all previous agreements, written or oral, between the parties or their respective affiliates, relating to the subject matter hereof.
|
| 22. |
If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement
shall remain in full force and effect to the fullest extent permitted by law and shall in no way be affected, impaired or invalidated.
|
| 23. |
This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without giving effect to the principles of conflicts of laws thereof. Each party irrevocably (a) submits to the exclusive
jurisdiction of the Court of Chancery of the State of Delaware (the “Court of Chancery”), or in the event that the Court of Chancery lacks jurisdiction, any other state or federal court of the State
of Delaware for purposes of any suit, action or other proceeding arising out of this Agreement, or of the transactions contemplated hereby, that is brought by or against you, and (b) agrees that the exclusive venue of such suit, action or
proceeding will be in the Court of Chancery, or in the event that the Court of Chancery lacks jurisdiction, any other state or federal court of the State of Delaware. 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 Court of Chancery or, if applicable, any other state or federal court of the State of Delaware, and hereby
further irrevocably and unconditionally waive and agree not to plead or claim in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum.
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| 24. |
For purposes of this Agreement: (a) the term “Representatives” means (x) the directors, officers, employees, investment professionals, agents, controlled affiliates, partners, advisors, or
representatives (including attorneys, accountants, consultants and financial advisors) of a party, and (y) only from and after such time as the Company consents in writing in its sole discretion, potential sources of debt or equity
financing to you or your affiliates (including potential financing sources contemplating a rollover of already-owned Company debt or equity in connection with any proposed Transaction); (b) the term “subsidiary”
means, when used with respect to any party, (x) a person or entity of which such party beneficially owns, either directly or indirectly, more than 50% of the total combined voting power of all classes of voting securities of such person or
entity, the total combined equity interests of such person or entity or the capital or profit interests, in the case of a partnership, or (y) a person or entity of which such party has the power to vote, either directly or indirectly,
sufficient securities to elect a majority of the board of directors or similar governing body of such person or entity; (c) the term “control” means, when used with respect to any specified person
or entity, the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such person, whether through the ownership of voting securities or other interests, by contract, agreement,
or otherwise; (d) the term “affiliate” shall be as such term is defined under the 1934 Act; (e) the term “person” shall be broadly interpreted to include a
natural person, the internet, the media and any corporation, partnership, group, or other entity; and (f) the word “or” is not exclusive.
|
| 25. |
By making Confidential Information or other information available to you or your Representatives, the Company is not, and shall not be deemed to be, granting (expressly or by implication) any license or other right under or with respect
to any patent, trade secret, copyright, trademark or other proprietary or intellectual property right.
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| 26. |
This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but both of which shall constitute the same agreement. Signatures to this Agreement transmitted by DocuSign, by electronic mail in
“portable document format” (.pdf) form, or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing the
original signature.
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|
27.
|
This Agreement shall be valid for a period of 24 months from the date hereof.
|
|
Very truly yours,
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||
|
SoundThinking, Inc.
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||
|
By:
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/s/ Ralph A. Clark
|
|
|
Name:
|
Ralph A. Clark
|
|
|
Title:
|
President and Chief Executive Officer
|
|
Transom Capital Group, LLC:
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||
|
By:
|
/s/ Ken Firtel
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|
|
Name: Ken Firtel
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|
|
Title: Managing Partner
|