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Business Sale Confidentiality Agreement for the United States

Business Sale Confidentiality Agreement Template for United States

A legally binding document used in the United States to protect confidential information disclosed during business sale negotiations. This agreement ensures that sensitive business information, trade secrets, financial data, and other proprietary information shared during the due diligence process remains confidential. It establishes obligations for handling confidential information, permitted uses, and consequences of unauthorized disclosure.

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What is a Business Sale Confidentiality Agreement?

The Business Sale Confidentiality Agreement is essential when a business owner considers selling their company and needs to share sensitive information with potential buyers. This U.S.-governed document is typically used at the initial stages of a business sale, before detailed due diligence begins. It protects proprietary information, customer lists, financial data, trade secrets, and other confidential details that potential buyers need to evaluate the business. The agreement outlines specific obligations regarding information handling, permitted uses, and consequences of breach.

What sections should be included in a Business Sale Confidentiality Agreement?

1. Parties: Identification of all parties involved in the agreement, including full legal names and addresses

2. Background/Recitals: Context of the agreement, including the intention to discuss potential business sale

3. Definitions: Key terms used throughout the agreement, particularly definition of 'Confidential Information'

4. Confidentiality Obligations: Core obligations regarding non-disclosure and permitted uses of confidential information

5. Term and Termination: Duration of the agreement and circumstances for termination

6. Return of Confidential Information: Obligations regarding return or destruction of confidential materials

7. Governing Law: Jurisdiction and applicable law

What sections are optional to include in a Business Sale Confidentiality Agreement?

1. Non-Solicitation: Prevents solicitation of employees/customers during and after the business sale process

2. Non-Competition: Restricts competitive activities based on information learned during the sale process

3. Representative Obligations: Specific obligations and responsibilities of party representatives who will have access to confidential information

4. Public Announcements: Rules and restrictions regarding public disclosure of the potential sale or related information

What schedules should be included in a Business Sale Confidentiality Agreement?

1. Schedule of Authorized Representatives: List of individuals authorized to receive and handle confidential information

2. Schedule of Specific Confidential Information: Detailed list of specific confidential materials and information to be shared

3. Form of Acknowledgment: Template for representatives to acknowledge and agree to confidentiality obligations

4. Security Protocols: Specific procedures and requirements for handling and protecting confidential information

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

United States

Publisher

Ƶ

Document Type

Sale Agreement

Cost

Free to use
Clauses

























Industries

Defend Trade Secrets Act (DTSA): Federal law enacted in 2016 that provides uniform federal protection for trade secrets and allows companies to file civil lawsuits in federal court for trade secret misappropriation

Economic Espionage Act: Federal law that criminalizes the theft of trade secrets and provides for both criminal and civil penalties for trade secret misappropriation

Securities Exchange Act: Federal law that governs securities trading and requires disclosure of certain business information if the company is publicly traded

Federal Trade Commission Regulations: Regulations governing unfair competition and business practices that may affect confidentiality obligations

Uniform Trade Secrets Act: State-level law (adopted by most states with variations) that provides protection for trade secrets and defines remedies for their misappropriation

State Contract Laws: State-specific laws governing contract formation, enforcement, and interpretation that vary by jurisdiction

State Employment Laws: State-specific regulations governing employment relationships and related confidentiality obligations

State Non-Compete Laws: State-specific regulations governing non-compete agreements and restrictions on information use

SEC Regulations: Federal regulations governing public companies and their disclosure obligations in business transactions

Antitrust Laws: Federal and state laws preventing anti-competitive behavior that may arise in business sale situations

Data Protection Laws: Federal and state laws governing the protection of personal and sensitive data that may be part of the business sale

Industry-Specific Regulations: Specific regulations that apply to particular industries (e.g., healthcare, financial services) affecting confidentiality requirements

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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