| Commentary

206 Confidentiality undertaking

| Commentary

2: THE NEGOTIATION STAGE

206 Confidentiality undertaking

As soon as serious negotiations have commenced, it is usual for the seller of the business to require the prospective buyer to enter into a confidentiality undertaking to the effect that any information which he obtains as a result of the due diligence enquiries and from the investigating accountant’s report:

  1. 206.1

        will be used only for the purpose of evaluating the business;

  2. 206.2

        will be kept confidential; and

  3. 206.3

        will not be passed on to a third party without express authority.

It will also be wise to include in the confidentiality undertaking:

  1. 206.4

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