Â The seller will therefore need to disclose confidential information to the buyer and the seller will want to ensure that any information disclosed remains confidential regardless of whether the transaction proceeds or not. The seller will therefore want to ensure confidentiality and non disclosure agreements are put in place. Below are several issues which need to be considered when disclosing confidential information:
-Â Â Â Â Â Â Â Â Â Who are the parties to the agreement? Is the buyer part of a group, does the group need to be included as a party, do any third parties need to be bound by the agreement, e.g. advisers and employees, etc.
-Â Â Â Â Â Â Â Â Â Has confidential information been defined and the confidential information identified?Â This includes limiting the definition of confidential information to the most crucial information and does not include information that is already public knowledge and known to the buyer.
-Â Â Â Â Â Â Â Â Â The information also needs to be marked ÂconfidentialÂ where appropriate, all the formats the information can take also need to be identified.
-Â Â Â Â Â Â Â Â Â All current information held by the seller needs to be reviewed to check the current confidentiality undertakings and security procedures put in place.
-Â Â Â Â Â Â Â Â Â Any disclosure of information should be planned between the parties, with a schedule being put in place identifying when disclosure is to take place, where and who the information may be disclosed to.
-Â Â Â Â Â Â Â Â Â Is there a contingency plan in place should the deal fall through or if the information is leaked?
-Â Â Â Â Â Â Â Â Â Ensure all formalities have been carried out and the agreement has been executed correctly with each party keeping a signed copy.