Covenants include non-competition, non-solicitation, confidentiality, cooperation on tax matters and litigation, further assurances, and earnout-related operating commitments.
Breach supports damages and injunctive relief.
Alternative Names:
Post-Closing Obligations|Continuing Covenant
Why it Matters?
Cooperation covenants regarding litigation and tax matters are frequently overlooked in drafting yet become essential when a pre-closing matter requires the seller's records or testimony. Absent an express obligation, a departed seller has no duty to assist. Earnout-related operating covenants are separately critical, since their absence invites implied covenant claims that express commitments would foreclose.
Frequently Confused with
Related terms
Frequently asked questions
Which covenant is most often omitted?
Why do earnout covenants matter?
