Mutual Confidentiality Undertaking without Penalty
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Download our Mutual Confidentiality Undertaking without Penalty template in Word format. This document is located in the Contractual Process chapter of Edilex's catalogue of Contract Templates.
Description
This contract is the legal instrument by which two parties open confidential lines of communication in order to collaborate to perform a proposed acquisition. This is a "mirror" agreement, as the parties to the agreement generally contract, in this preliminary phase, the same obligations toward each other.
Use
We recommend using this document if the transaction involves an exchange of confidential information. This usually occurs when the transfer of ownership of the business involves any payment in shares of the purchasing corporation, thus requiring the seller to review the financial health of the purchaser before accepting such a payment.
In the absence of such an agreement between the parties, there is a risk that unprotected information will be made available in the public domain, which may compromise any subsequent attempt by one or other of them to claim a property right in the information disclosed and the fruits thereof.
If there is only one party who discloses information of a confidential nature, we recommend the use of the unilateral confidentiality undertaking instead. (See documents 0001200)
