CCP Client 'CO318'
Significant Recurring Revenue from Residential and Commercial Security Systems

Clayton Capital Partners is pleased to exclusively represent CO318 (the “Company”) in the sale of its business. CO318 is a security alarm services company serving 72,000+ residential and commercial customers located in two states in the southeastern United States.


• Outstanding Brand Recognition – Over 25 years, the Company has established its brand as the premier provider of security systems through creative, comprehensive and proven radio advertising.


• Predictable Recurring Revenue – Two-thirds of the Company’s customers make payments monthly by bank draft or credit card, and 90% renew at the end of their initial contract periods.


• Two-Way Voice Communication with Central Monitoring Station – The Company’s two-way voice communication between customers and its central monitoring station provides immediate response to an alarm.


• Scalable Processes are an Ideal Platform for Expansion – Management has systemized sales, billing, training and collection processes that are replicable and scalable.


• Buying Leverage in Supply Chain – The Company is able to secure equipment from vendors at below-market prices due to the number of units it purchases.

CO318 Financial Highlights
External
Accountant Prepared
Accrual
Tax-Basis Accounting
LTM Ended
8/31/2019
External
Accountant Prepared
Accrual
Tax-Basis Accounting
Year Ended
12/31/2018
External
Accountant Prepared
Modified Cash
Tax-Basis Accounting
Year Ended
12/31/2017
External
Accountant Prepared
Modified Cash
Tax-Basis Accounting
Year Ended
12/31/2016
Total Revenue
$32,748,979 $31,625,965 $28,669,308 $27,633,361
Gross Profit %
79% 80% 81% 81%
Adjusted EBITDA $8,334,679 $7,198,597 $4,416,711 $3,901,155
Adjusted EBITDA %
25% 23% 15% 14%
NON-DISCLOSURE AGREEMENT

Recipient: ____________________________________________________________________________________

Recipient’s Address: ____________________________________________________________________________________

____________________________________________________________________________________

____________________________________________________________________________________


Effective Date: _____________________________________, 2020


In connection with a possible transaction (the "Acquisition Transaction") witha corporate client of Clayton Capital Partners, Inc. (“Clayton Capital;” the corporate client of Clayton Capitalis referred to herein as the “Company”), the Recipient has requested access to certain information of the Company.Clayton Capital’s client identification # for the Company is: #CO318.


In consideration for and as a condition to the Company's furnishing access to such information of the Company as the Company, in its sole discretion, agrees to make available, the Recipient agrees as follows:

  1. CONFIDENTIAL AND PROPRIETARY NATURE OF THE INFORMATION

    The Recipient acknowledges the confidential and proprietary nature of the “Evaluation Material” (as defined below), agrees to hold and keep the same confidential as provided in this Agreement, and otherwise agrees to each and every restriction and obligation in this Agreement.
  2. CERTAIN DEFINED TERMS

    As used in this Agreement,

    (a) the term “Evaluation Material” means all information concerning the Company or its subsidiaries (whether furnished before or after the date hereof, whether prepared by the Company, its Representatives, or otherwise, whether or not marked as being confidential and regardless of the form of communication, including oral as well as written and electronic communications) that is furnished to Recipient or to Recipient Representatives by or on behalf of the Company. The term “Evaluation Material” also includes all notes, analyses, compilations, studies, interpretations, and other documents prepared by Recipient or Recipient Representatives that contain, reflect, or are based upon, in whole or in part, the information that the Company or the Company’s Representatives furnish to Recipient or Recipient Representatives. The term “Evaluation Material” does not include information that (i) has become generally known to the public other than as a result of a disclosure by the Company or the Company’s Representatives, (ii) was within Recipient’s possession prior to its being furnished to Recipient by or on behalf of the Company, provided that the source of such information was not bound by a confidentiality agreement with, or other contractual, legal, or fiduciary obligation of confidentiality to, the Company or any other person with respect to such information, or (iii) has become available to Recipient on a non-confidential basis from a source (“Outside Source”) other than the Company or any of the Company’s Representatives if such source was not bound by a confidentiality agreement with, or other contractual, legal, or fiduciary obligation of confidentiality to, the Company or any other person with respect to such information (“Other Confidentiality Obligation”).If the Recipient makes due inquiry of the Outside Source as to the existence of an Other Confidentiality Obligation and reasonably determines in good faith that there is not, then the Recipient may use that information from the Outside Source without breaching this Agreement except for that part that identifies (1) employeesof the Company, or (2) customers of the Company.

    (b) the term “Representative” means, as to any person, such person’s affiliates, and its and their directors, officers, managers, general partners, members, employees and agents, advisors (including without limitation, financial advisors, legal counsel, and accountants), and controlling persons; the term “affiliate” has the meaning given to that term in Rule 12b-2 of the General Rules and Regulations under the Securities Exchange Act of 1934, as amended (the “Exchange Act”); Recipient’s Representatives shall be further defined to mean only those of its Representatives to whom any of the Evaluation Material has been or hereafter furnished or as to which such Representative was provided access; and the term “person” means natural persons and all legal persons, including, without limitation, any corporation, general or limited partnership, limited liability company, trust, or other entity or company.
  3. RESTRICTED USE OF EVALUATION MATERIAL

    The Recipient agrees that the Evaluation Material (a) will be kept confidential by the Recipient and the Recipient's Representatives and (b) without limiting the foregoing, will not be disclosed by the Recipient or the Recipient's Representatives to any person (including current or prospective financing sources) except with the specific prior written consent (which may delivered via facsimile or e-mail) of Kevin Short ("Company Contact") or except as expressly otherwise permitted by the terms of this Agreement. It is understood that the Recipient may disclose Evaluation Material to only those of the Recipient's Representatives who (i) require such material for evaluating a possible Acquisition Transaction (but to the extent practicable, only such part that is so required and without revealing the possible Acquisition Transaction), and (ii) aredirected to comply with the terms of this Agreement to the same extent as if they were parties hereto. The Recipient further agrees that the Recipient and the Recipient's Representatives will not use any of the Evaluation Material either for any reason or purpose other than to evaluate a possible Acquisition Transaction or in any way detrimental to the Company (it being acknowledged that any use other than evaluation of the possible Acquisition Transaction may be detrimental). The Recipient also agrees to direct the Recipient’s Representatives to comply with the provisions of this Agreement and shall be responsible for any failure of the Recipient’s Representatives to comply.


  4. Notwithstanding anything contained herein to the contrary, the Company acknowledges that Recipient and its affiliates may now and in the future be direct competitors of the Company and that Recipient’s mere receipt and possession of the Evaluation Material will not, in and of itself, prevent or restrict it in any way from carrying on its business in the ordinary course, including without limitation, making quotes or bids in direct competition of the Company or developing new products or services, so long as the Evaluation Material was not used for that purpose.

    Furthermore, the parties hereto acknowledge that Recipient and Recipient’s affiliates may be engaged in the business of making investments and that Recipient shall have the right to, and shall have no duty (contractual or otherwise) not to, directly or indirectly, pursue or engage in the same or similar business activities or lines of business as the Company or any of its affiliates, including those competing with the Company or its affiliates.
  5. NONDISCLOSURE OF POSSIBLE ACQUISITION TRANSACTION

    Except with the prior written consent of the Company, Recipientwill not disclose the fact that any discussions or negotiations are taking place concerning a possible Acquisition Transaction. Recipient further expressly agrees that it will not disclose, and shall treat as confidential, the fact that the Company is considering an Acquisition Transaction or possibly selling any part of its business or operations.
  6. COMPANY CONTACT

    All requests by the Recipient or the Recipient's Representatives for Evaluation Material, meetings with Company personnel or Company Representatives, or inspection of the Company's properties must be made to the Company Contact.

    Kevin Short
    Managing Partner & CEO
    Clayton Capital Partners
    8112 Maryland Avenue, Suite 250
    St. Louis, MO 63105
    Phone: 314-725-9939 x525
    kshort@claytoncapitalpartners.com
  7. LEGALLY COMPELLED DISCLOSURE

    If Recipient or any Recipient Representative is required, in the opinion of its legal counsel who has been informed of the relevant facts, by law or the rules of any securities exchange to which Recipient or any such Representative is subject, or in any judicial, administrative, or other legal proceeding, or pursuant to subpoena, civil investigative demand, or other compulsory process, to disclose any of the Evaluation Material or any Transaction, Recipient and Recipient Representative shall provide the Company with prompt written notice of any such requirement, to the extent Recipient and it may legally do so, so that the Company may seek a protective order or other appropriate remedy, and will consult with the Company with respect to the Company or Recipient (or such Representative) taking steps to resist or narrow the scope of such required disclosure. If, in the absence of a protective order or other remedy or the receipt of a waiver by the Company, Recipient or any Recipient Representatives are nonetheless, in the further opinion of legal counsel, legally compelled to disclose Evaluation Material to any tribunal or other authority or else stand liable for contempt or suffer other censure or penalty, Recipient (or such Representative) may disclose only that portion of the Evaluation Material that such counsel advises is legally required to be disclosed, provided that Recipient (or such Representative) exercise commercially reasonable efforts to preserve the confidentiality of the Evaluation Material, including, without limitation, by cooperating with the Company to obtain an appropriate protective order or other reliable assurance that confidential treatment will be accorded the Evaluation Material by such tribunal or other authority.
  8. CONTACT WITH EMPLOYEES

    Without the prior written consent (which may delivered via facsimile or e-mail) of the Company Contact (a) neither the Recipient nor any of the Recipient's Representatives will initiate or cause to be initiated (other than through the Company Contact) any communication with any employee of the Company concerning the Evaluation Material or any possible Acquisition Transaction, and (b) the Recipient and the Recipient's Representatives will not, for a period of two years after the date of this Agreement, solicit or cause to be solicited the employment of or employ, any current salaried employee of the Company.Notwithstanding the above, Recipient may hire a person previously employed by the Company if that person initiates the contact with Recipient and that person’s employment with the Company was previously terminated by the Company without “cause”.

    Nothing contained in this Agreement shall prohibit Recipient or Recipient’s Representatives from (i) making general solicitations for hiring provided such solicitations are not specifically directed at any employee or personnel of the Company, or (ii) use of third party recruiting firms provided they are not instructed to specifically target the Company or its employees, or (iii)soliciting for hire any employee or personnel of the Company provided that such solicitation was made by a Recipient Representative who did not have any knowledge of, or access to, the Evaluation Material and who was not directed, directly or indirectly, to make such solicitation by anyRecipient Representative who did have knowledge of or access to the Evaluation Material.

    The Company has entered into confidentiality, non-solicitation and/or non-competition agreements with certain of its employees. Notwithstanding anything to the contrary, nothing in this Agreement shall amend those agreements or consent to or act as a waiver or release for any interference with those agreements.
  9. RETURN OF EVALUATION MATERIAL

    Upon written request of the Company, then (a) the Recipient (i) will promptly deliver to the Company Contact all documents or other materials furnished by the Company or any Company Representative to the Recipient or the Recipient's Representatives constituting Evaluation Material, together with all copies and summaries thereof in the possession or under the control of the Recipient or the Recipient's Representatives, and (ii) will destroy materials generated by the Recipient or the Recipient's Representatives that include or refer to any part of the Evaluation Material, without retaining a copy of any such material or (b) alternatively, the Recipient will destroy all documents or other matters constituting Evaluation Material in the possession or under the control of the Recipient or the Recipient's Representatives. Any such destruction pursuant to the foregoing must be confirmed by the Recipient in writing to the Company.Notwithstanding the foregoing, Recipientand Recipient’s Representatives may retain data or electronic records containing Evaluation Material for the purposes of backup, recovery, contingency planning, or business continuity planning so long as such data or records, to the extent not permanently deleted or overwritten in the ordinary course of business, are not accessible in the ordinary course of business and are not accessed except as required for backup, recovery, contingency planning, or business continuity purposes (“Backup Copies”). If such data or records are restored or otherwise become accessible, Recipient agree to permanently delete them. Notwithstanding anything to the contrary, the obligations in this Agreement shall not terminate with respect to any Backup Copy (or any Evaluation Material contained therein) until the earlier of: (x) two (2) years after that Backup Copy (or any Evaluation Material contained therein)is returned or destroyed; or (y) the fifth (5th) anniversary of the Effective Date set forth above.
  10. NO OBLIGATION TO NEGOTIATE A DEFINITIVE AGREEMENT

    Nothing in this Agreement requires either the Recipient or the Company or its shareholders to enter into an Acquisition Transaction or to negotiate such transaction for any specified period of time.
  11. NO REPRESENTATIONS OR WARRANTIES

    The Company retains the right to determine, in its sole discretion, what information, properties, and personnel it wishes to make available to the Recipient, and neither the Company nor its Representatives make any representation or warranty (express or implied) concerning the completeness or accuracy of the Evaluation Material, except pursuant to representations and warranties that may be made to the Recipient in a definitive acquisition agreement for an Acquisition Transaction if, when, and as executed and subject to such limitations and restrictions as may be specified therein.
  12. REMEDIES

    Recipient acknowledges and agrees that it is presumed that money damages would not be a sufficient remedy for breach of this Agreement by Recipient or any Recipient Representative and that the Company will be entitled to seek equitable relief, including injunctions and specific performance, as a remedy for any such breach without the necessity of posting any bond or other security and without proof of irreparable harm or of any actual damages. Such remedies will nonetheless not be deemed to be the exclusive remedies for a breach of this Agreement and will be in addition to all other remedies available at law or in equity.
  13. TERM

    All obligations under this Agreement shall terminate upon the earlier of (i) the closing of a transaction wherein the Recipient purchases the assets or capital stock of the Company, or (ii) with the exception of the Backup Copies (see Paragraph 8 above), the second (2nd) anniversary of the Effective Date above.
  14. MISCELLANEOUS

    (a) Modification. This Agreement’s terms may be modified or waived only by a separate writing signed by the parties expressly modifying or waiving such terms.

    (b) Waiver. Waiver. Neither the failure nor any delay by any party in exercising any right, power, or privilege under this Agreement will operate as a waiver of such right, power, or privilege, and no single or partial exercise of any such right, power, or privilege will preclude any other or further exercise of such right, power, or privilege or the exercise of any other right, power, or privilege. To the maximum extent permitted by applicable law, (i) no waiver that may be given by a party will be applicable except in the specific instance for which it is given; and (ii) no notice to or demand on one party will be deemed to be a waiver of any obligation of such party or of the right of the party giving such notice or demand to take further action without notice or demand as provided in this Agreement.

    (c) Person. The term "person" means any individual, corporation (including any non-profit corporation), general or limited partnership, limited liability company, joint venture, estate, trust, association, organization, labor union, or other entity or governmental body.

    (d) Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provisions of this Agreement, which shall remain in full force and effect.

    (e) Costs. In the event of litigation relating to this Agreement, the non-prevailing party will be liable and will pay to the prevailing party the reasonable legal fees incurred by such prevailing party in connection with such litigation, including any appeal therefrom.

    (f) Assignment.The Company reserves the right to assign all of its rights under this Agreement, including the right to enforce all of its terms. In the event of an Acquisition Transaction that involves a sale of assets, the Company currently intends to assign to the buyer rights to enforce the restrictions and other obligations of this Agreement, including the right to enforce all of its terms.

    (g) Jurisdiction; Service of Process. Service of Process. Any action or proceeding seeking to enforce any provision of, or based on any right arising out of, this Agreement may be brought against either of the parties in the courts of the State of Florida, County of Duval, or, if it has or can acquire jurisdiction, in the United States District Court for the Middle District of Florida, and each of the parties consent to the jurisdiction of such courts (and of the appropriate appellate courts) in any such action or proceeding and waives any objection to venue laid therein. Process in any action or proceeding referred to in the preceding sentence may be served on any party anywhere in the world.

    (h) Governing Law. This Agreement will be governed by the laws of the State of Delaware without regard to conflicts of laws principles.

    (i) Counterparts.This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original copy of this Agreement, and all of which, when taken together, shall be deemed to constitute one and the same agreement. Facsimile or PDF signatures shall have the same force and effect as original signatures.

IN WITNESS WHEREOF each of the parties has caused this Agreement to be executed by its duly authorized representative.


“COMPANY”

BY: CLAYTON CAPITAL PARTNERS, INC., Authorized Representative

By: ________________________________

Print name: ________________________________

Title: ________________________________


“RECIPIENT”

By:________________________________

Print name: ________________________________

Title: ________________________________

CCP Logo

CCP Client 'CO318'
For Additional Information Contact:
David McNaught, Senior Associate
8112 Maryland Ave., Suite 250
St. Louis, MO 63105
Ph 314-725-9939 x 533
dmcnaught@claytoncapitalpartners.com


Andy Huss, Analyst
8112 Maryland Ave., Suite 250
St. Louis, MO 63105
Ph 314-725-9939 x 544
ahuss@claytoncapitalpartners.com