Confidentiality agreements, also called non-disclosure agreements (or NDAs), are usually executed at an early stage in the negotiations relating to a corporate acquisition, joint venture, and asset acquisition.
They aim to ensure that:
- Any confidential information relating to the target business that is disclosed during the course of negotiations remains confidential
- The potential buyer is prevented from using the target’s confidential information for its own benefit if the transaction does not proceed to completion.
The Agreement can also be in a form of a letter agreement.