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A mutual termination agreement for businesses ending all or an identified part of an existing commercial services, software, supply or distribution agreement under ADGM law.
Abu Dhabi Global Market (ADGM)
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This agreement is dated the date on which it is signed by the last of the parties.
This agreement is made between [TO BE CONFIRMED — First Party] (the "First Party") and [TO BE CONFIRMED — Second Party] (the "Second Party").
"Existing Agreement" means [TO BE CONFIRMED — Existing Agreement], together with its amendments and each order, purchase order, statement of work and other document made under it.
"Termination Date" means [TO BE CONFIRMED — Termination Date].
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"Closing Balance" means [TO BE CONFIRMED — Closing Balance].
"Transition Period" means 30 days after the Termination Date.
"Transition Scope" means [TO BE CONFIRMED — Transition Scope].
With effect from the Termination Date, the parties mutually terminate the Existing Agreement only to the extent of the Termination Scope. The Existing Agreement remains in full force to the extent it falls outside the Termination Scope.
Neither party is required to perform any obligation under the terminated part of the Existing Agreement after the Termination Date, except an obligation which this agreement or the Existing Agreement states survives termination.
Termination does not affect any right, remedy, obligation or liability accrued on or before the Termination Date. Amounts properly due for goods delivered or services properly performed on or before the Termination Date remain payable, subject to this agreement.
Each party must submit any final invoice, credit note and reasonable supporting information relating to the terminated part of the Existing Agreement promptly after the Termination Date. The parties must cooperate in good faith to reconcile those amounts.
The party shown by the Closing Balance to be liable must pay the Closing Balance to the other party within [TO BE CONFIRMED — Closing Balance payment period] after the Termination Date. The Closing Balance is subject to any applicable tax and any credit, withholding or adjustment required by law.
A party may set off against an amount it owes under this agreement any liquidated and undisputed amount that the other party owes it under the Existing Agreement or this agreement, provided it gives reasonable written detail of the set-off.
The Second Party must refund the Refund Amount to the First Party within [TO BE CONFIRMED — Refund payment period] after the Termination Date. The Refund Amount is the agreed net amount of prepaid fees, credits and deposits attributable to goods or services not delivered by the Termination Date, after deducting properly incurred, non-recoverable charges expressly permitted by the Existing Agreement.
The First Party must pay the Second Party the Early Termination Charge within [TO BE CONFIRMED — Early Termination Charge payment period] after the Termination Date. The Early Termination Charge is agreed compensation for the early termination and is the Second Party's sole recovery for loss of future profit, revenue or opportunity arising solely from that early termination.
Within 10 Business Days after the Termination Date after the Termination Date, each party must return to the other, or dispose of as the other reasonably directs, its property, materials, equipment, documents, access credentials and confidential materials in its possession or control. A party may retain one archival copy where reasonably necessary for legal, regulatory, insurance or internal record-keeping purposes, subject to the Confidentiality clause.
Within 10 Business Days after the Termination Date after the Termination Date, each party must, on the other's reasonable written request, provide a complete and commonly usable export of the other's business, customer and personal data held for the terminated part of the Existing Agreement. Within 30 days after the Termination Date after the Termination Date, each party must securely delete that data from its active systems and require deletion by its subcontractors, except to the extent retention is required by law or the data remains in routine backups not readily accessible. Retained data remains subject to the Confidentiality clause and applicable data protection law.
"Confidential Information" means information of a confidential nature that one party or its group companies disclose to the other in connection with this agreement. Each party must keep the other's Confidential Information confidential, use it only to perform or receive the Services, and disclose it only to its personnel, professional advisers, insurers and permitted subcontractors who need to know it and are bound by equivalent duties of confidence, or where the law, a court or a regulator requires disclosure. These duties do not apply to information that the recipient can show is or becomes public other than through its breach, was lawfully known to it without restriction, is independently developed, or is lawfully received from a third party without restriction. These duties continue for 5 years after the Termination Date and, for trade secrets, for as long as they remain trade secrets. In this clause, "Services" means the goods, services and other performance provided under the Existing Agreement.
Neither party may name the other as a client or supplier, or describe the Services, in any publicity without the other's prior written consent.
Each party must comply with applicable data protection law, including the ADGM Data Protection Regulations 2021. Where the Second Party processes personal data on the First Party's behalf, it must: process it only to the extent necessary to perform the Transition Scope or comply with this agreement and on the First Party's documented instructions; ensure that its personnel are bound by confidentiality; apply appropriate technical and organisational security measures; engage a sub-processor only with the First Party's prior written authorisation and on equivalent written terms; assist the First Party with data subjects' requests and its other compliance obligations; notify the First Party without undue delay of any personal data breach; transfer the personal data outside ADGM only on the First Party's instructions and as the law permits; delete or return it in accordance with the Data Return, Export and Deletion clause, unless the law requires it to be kept; and make available the information needed to demonstrate compliance and allow audits. Before any such processing, the parties must record in writing the subject matter, duration, nature and purpose of the processing, the types of personal data and the categories of data subjects.
Termination does not transfer ownership of intellectual property rights. Each party retains ownership of its intellectual property rights and of materials created independently of the Existing Agreement. Subject to payment of all amounts properly due, licences validly granted under the Existing Agreement before the Termination Date to use deliverables, software, documentation or other materials continue to the extent necessary for the First Party, its affiliates, customers and end users to use goods or services delivered before the Termination Date. Any sublicence validly granted to a customer or end user before the Termination Date continues on its terms. Licences granted solely for future performance terminate on the Termination Date.
During the Transition Period, the parties must cooperate in good faith to complete the Transition Scope and achieve an orderly handover. The Second Party must provide reasonable assistance, information, access and cooperation needed for that purpose, provided it does not materially disrupt its business. The First Party must provide timely decisions, access and cooperation. Transition assistance within the Second Party's ordinary obligations is included in the Closing Balance; additional assistance requested by the First Party must be agreed in writing and paid at the rates in the Existing Agreement or, if none, the Second Party's reasonable standard rates.
Any warranty, indemnity or related claim under the Existing Agreement in respect of facts, acts, omissions, goods or services occurring on or before the Termination Date survives in accordance with the Existing Agreement, including its notice requirements, limitations, exclusions and time limits. Neither party gives a new warranty or indemnity under this agreement except as expressly stated in it.
Each party must maintain for 6 years after the Termination Date after the Termination Date the insurance required by the Existing Agreement to the extent it covers liabilities arising from acts or omissions before the Termination Date, or equivalent cover on commercially reasonable terms. On reasonable request, it must provide evidence of that cover.
This agreement does not create any new non-compete, non-solicitation, non-dealing or other restrictive covenant. Any restriction validly surviving under the Existing Agreement is unaffected except to the extent this agreement expressly states otherwise.
This agreement records a commercial arrangement and is not an admission by either party of fault, liability, breach or wrongdoing.
Nothing in this agreement releases, waives or settles any claim of either party. Each party retains its rights and remedies, subject to the Existing Agreement and this agreement.
Each party must give any notice, obtain any consent and make any filing required from its customers, subcontractors, guarantors, regulators or other third parties as a result of the termination. The parties must cooperate reasonably in preparing consistent communications, but neither party is responsible for the other's legal or regulatory obligations.
Neither party may make a public announcement about this agreement or the termination without the other's prior written consent, except where disclosure is required by law, a court, a regulator or a securities exchange. Where lawful and practicable, the disclosing party must consult the other party before making the disclosure.
The provisions of this agreement which are stated to survive, or which by their nature are intended to survive, remain in force after the Termination Date. Without limitation, the Financial Close-Out, Property and Materials, Data Return, Export and Deletion, Confidentiality, Data Protection, Intellectual Property and Licences, Pre-Termination Warranties and Indemnities, Insurance, Restrictions, No Admission, Release, Third-Party Notices, Announcements, Survival, Relationship with Existing Agreement, Notices, Entire Agreement, Severability, Counterparts and Electronic Signature, Third-Party Rights, Governing Law and Disputes clauses survive. The Existing Agreement's provisions stated to survive termination also continue, subject to the Relationship with Existing Agreement clause.
This agreement supplements the Existing Agreement. If there is an inconsistency, this agreement prevails to the extent of that inconsistency. Except as expressly amended or terminated by this agreement, the Existing Agreement remains unchanged.
A variation of this agreement is effective only if it is in writing and signed by each party.
Neither party may assign, transfer, novate, charge, subcontract or deal in any other manner with any of its rights or obligations under this agreement without the other's prior written consent, except that a party may assign its rights and obligations to a member of its group or as part of a bona fide transfer of all or substantially all of the business to which this agreement relates, provided the assignee agrees in writing to be bound by this agreement.
A notice under this agreement must be in writing and delivered by hand, by courier or by email to the First Party at [TO BE CONFIRMED — First Party notice address] or to the Second Party at [TO BE CONFIRMED — Second Party notice address], or to any other address a party notifies for this purpose. A notice is received: if delivered by hand or courier, on delivery; and if emailed, at the time it is sent or, if that is outside business hours at the recipient's location, at 9.00 am on the next business day. This clause does not apply to the service of legal proceedings.
This agreement and the Existing Agreement constitute the entire agreement between the parties about the termination and supersede all previous discussions, correspondence, negotiations and understandings about that subject. Neither party has relied on a statement or representation not set out in this agreement or the Existing Agreement, except that nothing limits liability for fraud or fraudulent misrepresentation.
If a provision of this agreement is or becomes illegal, invalid or unenforceable, it is deemed modified to the minimum extent necessary to make it legal, valid and enforceable. If modification is not possible, the relevant provision is deemed deleted. That does not affect the legality, validity or enforceability of any other provision.
This agreement may be signed in any number of counterparts, each of which is an original and all of which together form one instrument. A counterpart may be signed and delivered electronically.
A person who is not a party to this agreement has no right to enforce any of its terms.
This agreement and any non-contractual obligations arising out of or in connection with it are governed by the laws of the Abu Dhabi Global Market. The Abu Dhabi Global Market Courts have exclusive jurisdiction to settle any dispute arising out of or in connection with this agreement, including any question about its existence, validity or termination.