Legal
Non-Disparagement Clause
Also known as: Non-disparagement provision, gag clause, silence clause
An indefinite restriction preventing the founder from making statements that could be construed as negative about the buyer or the deal. Limits what the founder can say about what was done to them.
WHY IT MATTERS
A post-close restriction preventing the founder from making any statement that could be 'construed' as negative about the buyer, the transaction, or the management of the business. Unlike non-competes and non-solicits which expire after 2–3 years, non-disparagement clauses typically survive indefinitely. The word 'construed' does the heavy lifting — it doesn't require intent, only the buyer's interpretation. In the Crossfield deal, the non-disparagement clause meant Dan couldn't warn other founders about the deal structure that took his money. Combined with for-cause triggers in the employment agreement, a single offhand comment could cascade into forfeiture of unvested equity and acceleration of the non-compete.