Seller Non-Disclosure

In M&A transactions, confidential and proprietary information (such as financial information and material contracts) often needs to be shared with the other party. But the path to doing so safely is making sure that the other party is bound to respect the confidential information provided and not use it to the disclosing party’s detriment.One common way to protect the secrecy of confidential information given to another party is through the use of a Non-Disclosure Agreement, which is sometimes also referred to as a “Confidentiality Agreement” or “NDA.” In this article, the key terms of such agreements are discussed.

Non-Disclosure Agreements don’t have to be long and complicated. In fact, well-drafted ones usually don’t run more than a few pages long.

The important elements of Non-Disclosure Agreements include:

Identification of the parties
Definition of what is deemed to be confidential
The scope of the confidentiality obligation by the receiving party
The exclusions from confidential treatment
The obligation to return or destroy confidential information when requested by the disclosing party
The term of the agreement