[Updated 12 April 2018: I still use the approach outlined in this post.]
I’ve structured Koncision’s automated confidentiality-agreement template so that you have (1) a period during which one party provides the other with, or the parties exchange, confidential information and (2) a subsequent period during which a party that received information during that initial period must keep it confidential.
I had previously contemplated referring to the initial term as “the term of the agreement,” with the end of that period constituting termination of the agreement. That’s a pretty standard arrangement, but it flat-out doesn’t make sense. After the initial period, the contract is by no means over. Instead, it continues to serve its primary purpose—restricting disclosure of confidential information.
So I plan on no longer using “term” and “termination” with respect to the initial period. What I do instead will depend on the context, but if the confidentiality agreement relates to due diligence in advance of a proposed transaction, I have in mind using the defined term Due-Diligence Period for the initial period. [Updated 12 April 2018: I now use the defined term Disclosure Period.]
Some might find disconcerting a confidentiality agreement that doesn’t refer to termination. Well, any comfort derived from termination that is said to occur at the end of the due-diligence period would have to be based on a misunderstanding.
And otherwise, Koncision’s confidentiality agreement will say that the obligation to keep information confidential continues perpetually after the due-diligence period, for a stated time after the due-diligence period, or for some combination of the two. So far nothing in the drafting logic requires that I pronounce that the end of any such stated period constitutes termination of the contract.
But these ideas are about two hours old. Any thoughts?
