Table of contents

Drafting contracts

(j) Announcements

Many companies, and particularly those that are subject to regulatory requirements on disclosure of inside information, would like to keep some control over (public) announcements made by their partners, suppliers, customers etc. The following miscellaneous provision is rather restrictive, but in practice it does not seem to lead to significant problems. Like all contractual prohibitions, they force one party to obtain the waiver or approval of the other party and, similarly, they trigger transparency rather than non-cooperative responses.

Announcements. This Agreement and its contents shall be considered confidential by the Parties. Neither Party shall make any announcement with respect to the transactions contemplated by this Agreement or any ancillary matter without the prior written approval of the other Party.

The provision is often inserted as part of the article on confidentiality but may well be positioned as a miscellaneous clause. Often a party wants to avoid the purchase price being disclosed. In such case, the buyer may need a carve-out for disclosures vis-à-vis the banks providing its financing. In private equity transactions, the buyer will likely require the following exception:

Notwithstanding the previous sentence, the Purchaser shall be entitled to disclose information relating to the purchase price under this Agreement to the limited partners of its parent entity, to potential limited partners of its parent entity and to banks and other institutions interested in providing financing, without the prior written consent of Seller.

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Drafting contracts

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