Pre-Acquisition Letters of Intent – Seller's Perspective
From Seller's Perspective, a Nondisclosure Agreement (NDA) should:
Describe the proprietary and confidential information (Protected Information) disclosed and state the purpose for which buyer may use it, buyer's obligations regarding the Protected Information, and the NDA's term;
State that it does not obligate either party to sell or buy the business and how buyer must dispose of the Protected Information if there is no sale;
Require that Buyer not disclose the NDA's existence or that sale discussions or negotiations are occurring and not communicate with any seller employee for an agreed period after the NDA's signing;
Disclaim all warranties and representations concerning Protected Information disclosed under the NDA; and
Hold buyer and its representatives accountable for a breach – usually through an injunction, an accounting, the repayment of any monies buyer receives resulting from the breach, or a combination of such remedies, if available.
This post is provided as a courtesy and is not and is not intended to be an exhaustive treatment of its subject matter, but rather an overview of some of the pertinent elements of the subject discussed. It is not legal advice or a legal opinion and should not be relied on in making legal or business decisions.