Mutual Termination Agreement and Release
This Mutual Termination Agreement and Release (the "Agreement") is made as of [Date of this termination agreement] between [First party (you or your company)] ("First Party") and [Second party] ("Second Party"). First Party and Second Party are each a "Party" and together the "Parties". The Parties are parties to the [Title of the contract being terminated] dated [Date of that contract], described as follows: [Brief description, including any SOWs, orders or amendments included] (together with all schedules, exhibits, statements of work, orders and amendments described above, the "Contract"). The Parties wish to terminate the Contract by mutual agreement and to settle all matters between them arising out of it, on the terms below.
1. Termination
The Contract is terminated effective as of [Termination effective date] (the "Termination Date"). From the Termination Date neither Party has any further obligation to perform under the Contract, except for the obligations stated in this Agreement and the Surviving Provisions described in Section 5. Any notice period, termination fee, minimum commitment, or other condition of termination in the Contract is waived, and neither Party shall be treated as having breached or wrongfully terminated the Contract. Any purchase order, statement of work, order form or schedule under the Contract that is described above is terminated with it; any not described above is unaffected by this Agreement.
2. Final Payment
Final payment: [Who pays the final payment], in the amount of [Final payment amount (or $0)] (the "Final Payment"), on or before [Final payment due date], by wire transfer, ACH or check to the account the receiving Party designates in writing. The Final Payment covers the following and is in full and final settlement of all amounts owed under the Contract by either Party to the other: [What the final payment covers and treatment of work in progress]. If the Final Payment amount is zero, the Parties confirm that no amount is owed by either Party to the other under the Contract.
Except for the Final Payment, each Party waives any claim for fees, expenses, commissions, refunds, credits, deposits, damages, or any other amount under or in connection with the Contract, whether or not invoiced, and no further invoice shall be issued under the Contract. If the Final Payment is not made when due, it bears interest at one percent (1%) per month from the due date until paid, and the receiving Party may recover its reasonable costs of collection, including attorney fees; the release in Section 4 does not release the obligation to make the Final Payment.
3. Work in Progress; Return of Property and Information
Any work in progress under the Contract is dealt with as stated in the description of the Final Payment above; unless stated there, neither Party is obligated to complete, deliver or pay for work not completed and accepted before the Termination Date. Within [Property and data returned within (days)] days after the Termination Date, each Party shall return to the other, or at the other’s written election destroy and certify the destruction of, all property, equipment, documents, data, materials and confidential information of the other Party in its possession or control, including copies, and shall revoke or return all access credentials, keys and badges, retaining only copies that applicable law or a bona fide document retention policy requires it to keep, which remain subject to the confidentiality obligations of the Contract. Any licence granted under the Contract ends on the Termination Date unless the Contract or the Final Payment description states that it survives.
4. Mutual Release
Effective on the later of the date both Parties sign this Agreement and the receipt of the Final Payment, each Party, for itself and its parents, subsidiaries, affiliates, owners, officers, directors, employees, agents, successors and assigns, releases and forever discharges the other Party and its parents, subsidiaries, affiliates, owners, officers, directors, employees, agents, successors and assigns from all claims, demands, causes of action, obligations, damages and liabilities of every kind, whether known or unknown, suspected or unsuspected, fixed or contingent, at law or in equity, arising out of or relating to the Contract, its negotiation, performance, breach or termination, from the beginning of time through the date of this Agreement (the "Released Claims").
The Released Claims do not include: (a) any obligation created by this Agreement; (b) any obligation under the Surviving Provisions; (c) any claim that by law cannot be released; or (d) any claim arising from events after the date of this Agreement. Each Party acknowledges that it may later discover facts different from or in addition to those it now knows or believes to be true, and agrees that the release is nevertheless effective as to all Released Claims. Each Party waives the benefit of California Civil Code §1542, which provides: "A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party," and of any similar law of any other jurisdiction. Each Party represents that it has not assigned any Released Claim to any other person and shall not bring, and shall indemnify the other against, any action on a Released Claim.
5. Surviving Provisions
The following provisions of the Contract survive termination and continue in effect according to their terms (the "Surviving Provisions"): [Sections of the contract that survive], together with any other provision of the Contract that by its express terms survives termination or expiry, and any provision necessary to interpret or enforce the Surviving Provisions. Without limiting the foregoing, each Party shall continue to keep confidential the other Party’s confidential information received under the Contract for the period the Contract specifies or, if none, for three (3) years after the Termination Date, and for trade secrets for as long as they remain trade secrets. Ownership of intellectual property as allocated under the Contract is not changed by this Agreement, and any assignment or licence that the Contract states survives termination remains in effect.
6. No Admission; Confidentiality; Non-Disparagement
This Agreement is a compromise and neither it nor anything in it is an admission of liability, breach or wrongdoing by either Party, each of which denies any such liability. The Parties shall keep the terms of this Agreement, including the Final Payment, confidential, and shall not disclose them except to their owners, lenders, insurers, attorneys, accountants and advisers who need to know them and are bound to keep them confidential, as required by law or court order, or as needed to enforce this Agreement. Either Party may state that the Contract has ended by mutual agreement. Neither Party shall make any statement, orally, in writing or online, that disparages the other Party or its products, services, owners or personnel, provided that nothing in this Section prevents truthful testimony compelled by law, communications with a government agency, or statements protected by law.
7. Representations
Each Party represents and warrants to the other that: it has full power and authority to enter into this Agreement and the person signing for it is authorized to do so; this Agreement is binding on it; it has read and understands this Agreement, has had the opportunity to consult counsel of its choice, and enters into it voluntarily and without relying on any representation not stated in it; and it has not assigned or transferred any claim or interest under the Contract to any other person. Each Party shall sign any further document and take any further action reasonably requested by the other to carry out this Agreement, including notices to third parties that the Contract has ended.
8. Governing Law; General
This Agreement is governed by the laws of the State of [Governing law (state)], without regard to its conflict of laws rules, and any action arising out of it shall be brought in the state or federal courts located in that state; the prevailing Party is entitled to reasonable attorney fees and costs. This Agreement is the entire agreement between the Parties about the termination of the Contract and supersedes all prior discussions and understandings about it; as to the Contract itself, this Agreement and the Surviving Provisions are the only continuing terms between the Parties. It may be amended only in a writing signed by both Parties. It binds and benefits the Parties and their successors and permitted assigns, and no Party may assign it without the other’s written consent. If any provision is held unenforceable, it shall be enforced to the maximum extent permitted and the remainder continues in effect; if the release in Section 4 is held unenforceable as to a Party, the other Party’s release is likewise ineffective and the Final Payment shall be returned. Notices shall be in writing and delivered to the email addresses in the execution record or to the notice addresses in the Contract. This Agreement may be signed electronically and in counterparts, each of which is an original and all of which together are one instrument, and the electronic execution record, timestamps and document fingerprints kept by the signing platform are conclusive evidence of its execution.
Signatures
First party · Second party