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Drafting Preliminary Agreements

A confidentiality agreement (“Confidentiality Agreement”), also sometimes called a non- disclosure agreement (“NDA”), is typically the first stage in the due diligence process for an acquisition transaction as parties generally are reluctant to provide confidential information to the other side without having the protection of a confidentiality agreement. After a Confidentiality Agreement is in place, the parties exchange information and proceed to negotiate the terms of a transaction. If the negotiations are successfully completed, the parties may enter into a letter of intent. While the parties initially intend that a letter of intent does not bind the parties to proceed with a transaction, disputes often arise as to whether and to what extent the parties are contractually bound.

The Development of the Texas Non-Compete: a Tortured History

A recent article in the New York Times reported the State of Texas hands out more incentives than any other state; around $19 billion a year, to lure the most dynamic businesses in the United States to the Lone Star State. The governor of Texas stated that "Facebook, eBay, Apple – all of those within the last two years have announced major expansion in Texas . . . . They’re coming because it is given, it is covenant, in the boardrooms across America, that our tax structure, regulatory climate and legal environment are very positive to those businesses." Although Texas offers tax incentives and a favorable business climate, high tech businesses may have, in the past, understandably been reluctant to relocate to Texas because of the prior anemic protection granted to businesses in the arena of non-competes. These businesses, one assumes, have no interest in training their best and brightest today, only to have them become competitors tomorrow.

Anatomy of a Transaction

This articles discusses the mechanics of a business transactions, including letters of, non-disclosure agreements, and the signing & closing.

7 Deadly Sins of Confidentiality Provisions and NDAS

Although the classic Deadly Sins do not ordinarily impact the process of drafting a Confidentiality Provision, the dramatic title is appropriate since this paper will focus on seven issues that arise in negotiation and drafting of contract terms related to "confidentiality" (and to Non-Disclosure Agreements - "NDAs") that can present significant difficulties for practitioners and clients.

What to Do When Someone Comes Knocking: Non-Disclosure Agreements

When business enterprises undertake to evaluate a proposed transaction, the parties will usually begin by negotiating the terms of a non-disclosure agreement. That non-disclosure agreement will serve as the frame work that allows the parties to share confidential and proprietary information necessary to fully evaluate, negotiate, and consummate a proposed transaction, while sufficiently protecting against unauthorized disclosure. Set forth below is a discussion of a few key considerations when negotiating non-disclosure agreements in business transactions.

Non-Disclosure and Other Preliminary Agreements in Business Transactions

A confidentiality agreement (“Confidentiality Agreement”), also sometimes called a nondisclosure agreement (“NDA”), is typically the first stage for the due diligence process as parties generally are reluctant to provide confidential information to the other side without having the protection of a confidentiality agreement. The target typically proposes its form of confidentiality agreement, and a negotiation of the confidentiality agreement ensues. A seller’s form of confidentiality agreement is attached as Appendix A.