This clause says you cannot tell anyone outside the deal about the terms, price, or other details of what you're buying or selling. It matters because the price you pay (or receive) is commercially sensitive—if competitors know it, they can undercut you or demand the same terms. In US contract law, confidentiality clauses are enforceable as long as they're not unreasonably broad; UK courts apply a similar test under the "reasonableness" principle. If you break this clause, you can be sued for damages or forced to stop the disclosure by a court order called an injunction.
Accept this clause in principle, but narrow it carefully. Carve out exceptions for: (1) your employees and advisors who need to know, (2) your accountant and tax advisor, and (3) disclosure required by law or court order. Set a time limit—for example, confidentiality lasts 3-5 years, not forever. If you're selling a business, push to disclose the price to your bank or future lenders, as you'll likely need to. ---
Frequently Asked Questions
What does this clause mean in simple terms?
This clause says you cannot tell anyone outside the deal about the terms, price, or other details of what you're buying or selling.
Why should I care about this clause?
It matters because the price you pay (or receive) is commercially sensitive—if competitors know it, they can undercut you or demand the same terms.
What are my options?
In US contract law, confidentiality clauses are enforceable as long as they're not unreasonably broad; UK courts apply a similar test under the "reasonableness" principle.
How does this affect small businesses?
If you break this clause, you can be sued for damages or forced to stop the disclosure by a court order called an injunction.