What is a “General Duty Not to Disclose OR Covenant to Maintain Confidentiality” clause?..
This is usually a prohibition on the disclosure of the information in any way, except as authorized by the disclosing party (typically in writing), and for the purpose as defined in the confidentiality agreement. The section may also provide that the recipient of the confidential information will use their best efforts to preserve and protect the confidential information in the same manner in which they would preserve and secure their own personal information.Any breach of this clause will usually result in a breach of the underlying agreement (eg. employment agreement, contractor agreement, offer of purchase etc.), and may engage the remedies provisions of both the underlying agreement and the confidentiality agreement. If the underlying agreement so provides, breach of this provision may also give the disclosing party the right to terminate the underlying agreement.This is not a complete confidentiality agreement, which VCs and angel investors might be unwilling to sign during the negotiation phase of the transaction.An example of this clause is: The Corporation and the Investor, and any other persons acting on their behalf, shall keep this instrument in strict confidence and shall not use any information or materials for any purpose other than in considering or in connection with the transaction contemplated herein, and shall not issue any public statement concerning this instrument or the transaction contemplated herein without the other party's written consent.
Blogs related to this clause:
Can emails be considered confidential information, and therefore can come under the obligation to return or destroy?
June 1 2017
COURT ORDERS DELETION OF CONFIDENTIAL EMAILS Pakage Apparel Inc [...]
September 3 2015
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