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Draft a Non-Disclosure Agreement for a startup seeking investment.
Non-Disclosure Agreement
This Non-Disclosure Agreement (the "Agreement") is made and entered into as of [Date] by and between [Startup Name], a [State] [Type of Entity] with its principal place of business at [Startup Address] (the "Disclosing Party"), and [Investor Name], a [State] [Type of Entity] with its principal place of business at [Investor Address] (the "Receiving Party").
1. Introduction
1.1. The Disclosing Party is developing a new [Startup Business] (the "Technology"). The Disclosing Party desires to disclose certain confidential information relating to the Technology to the Receiving Party for the purpose of exploring a potential investment in the Disclosing Party (the "Purpose").
1.2. The Receiving Party desires to receive such confidential information from the Disclosing Party for the Purpose.
1.3. The parties agree that the confidential information disclosed by the Disclosing Party to the Receiving Party shall be held in confidence and shall not be disclosed to any third party without the prior written consent of the Disclosing Party.
2. Definitions
2.1. "Confidential Information" means any and all information disclosed by the Disclosing Party to the Receiving Party, whether orally, in writing, or by any other means, that is designated as confidential or that, under the circumstances surrounding disclosure, ought to be treated as confidential. Confidential Information includes, but is not limited to:
The Technology;
The Disclosing Party's business plans, financial information, marketing strategies, and customer lists;
The Disclosing Party's intellectual property, including patents, trademarks, copyrights, and trade secrets;
The Disclosing Party's employees, customers, and suppliers; and
Any other information that the Disclosing Party designates as confidential or that the Receiving Party knows or should know is confidential.
2.2. "Disclosure" means any communication or transfer of Confidential Information, whether oral, written, or by any other means.
2.3. "Third Party" means any person or entity other than the Disclosing Party and the Receiving Party.
3. Obligations of the Receiving Party
3.1. The Receiving Party agrees to hold all Confidential Information in strict confidence and not to disclose it to any Third Party without the prior written consent of the Disclosing Party.
3.2. The Receiving Party agrees to use the Confidential Information only for the Purpose and not for any other purpose.
3.3. The Receiving Party agrees to take all reasonable precautions to protect the confidentiality of the Confidential Information, including, but not limited to:
Storing the Confidential Information in a secure location;
Limiting access to the Confidential Information to authorized personnel;
Using appropriate security measures to prevent unauthorized access to the Confidential Information; and
Taking all reasonable steps to prevent the unauthorized disclosure of the Confidential Information.
3.4. The Receiving Party agrees to return all Confidential Information to the Disclosing Party upon the Disclosing Party's request or upon the termination of this Agreement, whichever occurs first.
3.5. The Receiving Party agrees to notify the Disclosing Party immediately if it becomes aware of any unauthorized disclosure of the Confidential Information.
4. Exceptions
4.1. The Receiving Party shall not be obligated to maintain the confidentiality of any Confidential Information that:
Is already in the Receiving Party's possession prior to the Disclosure;
Is or becomes publicly known through no fault of the Receiving Party;
Is rightfully received by the Receiving Party from a Third Party without any obligation of confidentiality;
Is independently developed by the Receiving Party without the use of the Confidential Information; or
Is required to be disclosed by law or by a court order.
5. Term and Termination
5.1. This Agreement shall commence on the date first written above and shall continue for a period of [Number] years from the date of the Disclosure (the "Term").
5.2. This Agreement may be terminated by either party upon [Number] days' written notice to the other party.
5.3. This Agreement shall automatically terminate upon the occurrence of any of the following events:
The Disclosing Party's receipt of a binding investment commitment from the Receiving Party;
The Disclosing Party's receipt of a binding investment commitment from a Third Party; or
The Disclosing Party's decision not to pursue an investment from the Receiving Party.
5.4. Upon the termination of this Agreement, the Receiving Party shall immediately cease all use of the Confidential Information and shall return all Confidential Information to the Disclosing Party.
6. Remedies
6.1. The Disclosing Party shall be entitled to seek injunctive relief to prevent the unauthorized disclosure or use of the Confidential Information.
6.2. The Disclosing Party shall also be entitled to seek monetary damages for any breach of this Agreement.
7. Governing Law
7.1. This Agreement shall be governed by and construed in accordance with the laws of the Republic of Kenya.
8. Notices
8.1. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given when delivered personally, sent by certified or registered mail, return receipt requested, or sent by overnight courier service, addressed as follows:
If to the Disclosing Party:
[Startup Name] [Startup Address]
If to the Receiving Party:
[Investor Name] [Investor Address]
or to such other address as either party may designate in writing from time to time.
9. Entire Agreement
9.1. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior or contemporaneous communications, representations, or agreements, whether oral or written.
10. Severability
10.1. If any provision of this Agreement is held to be invalid or unenforceable, such provision shall be struck and the remaining provisions shall remain in full force and effect.
11. Waiver
11.1. No waiver of any breach of this Agreement shall be deemed a waiver of any subsequent breach.
12. Binding Effect
12.1. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.
13. Counterparts
13.1. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.
[Disclosing Party Signature]
[Disclosing Party Name]
[Disclosing Party Title]
[Receiving Party Signature]
[Receiving Party Name]
[Receiving Party Title]
Table of Contents
Introduction
Definitions
Obligations of the Receiving Party
Exceptions
Term and Termination
Remedies
Governing Law
Notices
Entire Agreement
Severability
Waiver
Binding Effect
Counterparts
TLDR
This Non-Disclosure Agreement is a legally binding contract between a startup seeking investment and an investor. It outlines the confidential information that will be shared between the parties and the obligations of the Receiving Party to keep that information confidential.
Sources
Case Laws
There are no specific case laws directly related to Non-Disclosure Agreements in Kenya. However, the principles of confidentiality and breach of contract are well-established in Kenyan law.
The case of _Karanja v. The Standard Ltd_ (2003) eKLR** is a landmark case that established the principle of confidentiality in Kenya. The court held that a newspaper publisher had a duty to protect the confidentiality of information that was provided to it in confidence.
The case of _Kenya Commercial Bank Ltd v. Trust Bank Ltd_ (2004) eKLR** is a case that dealt with the issue of breach of contract. The court held that a party that breaches a contract is liable to pay damages to the other party.
These cases demonstrate the importance of confidentiality and the legal consequences of breaching a contract in Kenya.
Sample Non-Disclosure Agreement
This Non-Disclosure Agreement (the "Agreement") is made and entered into as of [Date] by and between [Startup Name], a [State] [Type of Entity] with its principal place of business at [Startup Address] (the "Disclosing Party"), and [Investor Name], a [State] [Type of Entity] with its principal place of business at [Investor Address] (the "Receiving Party").
1. Introduction
1.1. The Disclosing Party is developing a new [Startup Business] (the "Technology"). The Disclosing Party desires to disclose certain confidential information relating to the Technology to the Receiving Party for the purpose of exploring a potential investment in the Disclosing Party (the "Purpose").
1.2. The Receiving Party desires to receive such confidential information from the Disclosing Party for the Purpose.
1.3. The parties agree that the confidential information disclosed by the Disclosing Party to the Receiving Party shall be held in confidence and shall not be disclosed to any third party without the prior written consent of the Disclosing Party.
2. Definitions
2.1. "Confidential Information" means any and all information disclosed by the Disclosing Party to the Receiving Party, whether orally, in writing, or by any other means, that is designated as confidential or that, under the circumstances surrounding disclosure, ought to be treated as confidential. Confidential Information includes, but is not limited to:
The Technology;
The Disclosing Party's business plans, financial information, marketing strategies, and customer lists;
The Disclosing Party's intellectual property, including patents, trademarks, copyrights, and trade secrets;
The Disclosing Party's employees, customers, and suppliers; and
Any other information that the Disclosing Party designates as confidential or that the Receiving Party knows or should know is confidential.
2.2. "Disclosure" means any communication or transfer of Confidential Information, whether oral, written, or by any other means.
2.3. "Third Party" means any person or entity other than the Disclosing Party and the Receiving Party.
3. Obligations of the Receiving Party
3.1. The Receiving Party agrees to hold all Confidential Information in strict confidence and not to disclose it to any Third Party without the prior written consent of the Disclosing Party.
3.2. The Receiving Party agrees to use the Confidential Information only for the Purpose and not for any other purpose.
3.3. The Receiving Party agrees to take all reasonable precautions to protect the confidentiality of the Confidential Information, including, but not limited to:
Storing the Confidential Information in a secure location;
Limiting access to the Confidential Information to authorized personnel;
Using appropriate security measures to prevent unauthorized access to the Confidential Information; and
Taking all reasonable steps to prevent the unauthorized disclosure of the Confidential Information.
3.4. The Receiving Party agrees to return all Confidential Information to the Disclosing Party upon the Disclosing Party's request or upon the termination of this Agreement, whichever occurs first.
3.5. The Receiving Party agrees to notify the Disclosing Party immediately if it becomes aware of any unauthorized disclosure of the Confidential Information.
4. Exceptions
4.1. The Receiving Party shall not be obligated to maintain the confidentiality of any Confidential Information that:
Is already in the Receiving Party's possession prior to the Disclosure;
Is or becomes publicly known through no fault of the Receiving Party;
Is rightfully received by the Receiving Party from a Third Party without any obligation of confidentiality;
Is independently developed by the Receiving Party without the use of the Confidential Information; or
Is required to be disclosed by law or by a court order.
5. Term and Termination
5.1. This Agreement shall commence on the date first written above and shall continue for a period of [Number] years from the date of the Disclosure (the "Term").
5.2. This Agreement may be terminated by either party upon [Number] days' written notice to the other party.
5.3. This Agreement shall automatically terminate upon the occurrence of any of the following events:
The Disclosing Party's receipt of a binding investment commitment from the Receiving Party;
The Disclosing Party's receipt of a binding investment commitment from a Third Party; or
The Disclosing Party's decision not to pursue an investment from the Receiving Party.
5.4. Upon the termination of this Agreement, the Receiving Party shall immediately cease all use of the Confidential Information and shall return all Confidential Information to the Disclosing Party.
6. Remedies
6.1. The Disclosing Party shall be entitled to seek injunctive relief to prevent the unauthorized disclosure or use of the Confidential Information.
6.2. The Disclosing Party shall also be entitled to seek monetary damages for any breach of this Agreement.
7. Governing Law
7.1. This Agreement shall be governed by and construed in accordance with the laws of the Republic of Kenya.
8. Notices
8.1. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given when delivered personally, sent by certified or registered mail, return receipt requested, or sent by overnight courier service, addressed as follows:
If to the Disclosing Party:
[Startup Name] [Startup Address]
If to the Receiving Party:
[Investor Name] [Investor Address]
or to such other address as either party may designate in writing from time to time.
9. Entire Agreement
9.1. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior or contemporaneous communications, representations, or agreements, whether oral or written.
10. Severability
10.1. If any provision of this Agreement is held to be invalid or unenforceable, such provision shall be struck and the remaining provisions shall remain in full force and effect.
11. Waiver
11.1. No waiver of any breach of this Agreement shall be deemed a waiver of any subsequent breach.
12. Binding Effect
12.1. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.
13. Counterparts
13.1. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.
[Disclosing Party Signature]
[Disclosing Party Name]
[Disclosing Party Title]
[Receiving Party Signature]
[Receiving Party Name]
[Receiving Party Title]
Answered by mwakili.com