Confidentiality Agreement for Due Diligence Purpose Sample

When it comes to conducting due diligence, confidentiality is crucial in maintaining the integrity of the process. This is why a confidentiality agreement is often required by parties involved in the process. In this article, we will provide a sample confidentiality agreement for due diligence purposes that can be used as a guide.

Purpose of Agreement

The purpose of this confidentiality agreement is to maintain the confidentiality of the information shared between the parties involved in the due diligence process. This agreement applies to any information, documents, records, or data that are provided or obtained during the due diligence process.

Definition of Confidential Information

The confidential information includes all information that is not generally known to the public, including trade secrets, business plans, customer lists, financial data, and any other information that is considered confidential. This may also include any information that is marked or identified as confidential by the disclosing party.

Ownership of Confidential Information

Any confidential information shared between the parties during the due diligence process remains the property of the disclosing party. The receiving party must take all necessary measures to safeguard the information and prevent unauthorized access.

Use of Confidential Information

The receiving party must use the confidential information solely for the purpose of conducting due diligence. Any use of the information for any other purpose requires the prior written consent of the disclosing party.

Disclosure of Confidential Information

The receiving party may disclose the confidential information to its directors, officers, employees, advisors, and agents who have a need to know the information for the purpose of conducting due diligence. However, all such recipients must be bound by the terms of this agreement and must be informed of the confidential nature of the information.

The receiving party may also disclose the confidential information if required by law or court order, provided that it gives the disclosing party prior notice of such disclosure.

Duration of Confidentiality

The confidentiality obligations set forth in this agreement shall remain in effect for a period of two years from the date of disclosure of the confidential information.

Return of Confidential Information

Upon completion of the due diligence process, the receiving party must return all confidential information to the disclosing party or destroy it, including any copies, summaries, or notes made thereof.

Conclusion

A confidentiality agreement is an essential component of any due diligence process. It helps protect the integrity of the process and ensures that any sensitive information shared between parties remains confidential. The above sample agreement can be used as a guide to draft an agreement that is tailored to the specific needs of the parties involved.

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