This form is a "Residuals" Clause for Basic Nondisclosure Agreement usable in agreements regarding nondisclosure of licensing, patents, or commercial trade secrets. The residuals clause allows some disclosures of confidential information under certain limited circumstances.
The Iowa Residuals Clause for a Basic Nondisclosure Agreement (NDA) is a crucial component of protecting sensitive information in business transactions and partnerships. This clause ensures that any information disclosed under the NDA, which may be trade secrets, confidential data, or proprietary knowledge, will not be considered a breach of the agreement if it becomes known through lawful means or is independently developed by the recipient party. The primary purpose of the Iowa Residuals Clause is to acknowledge that certain information, although confidential, can naturally remain with the recipient party, even after the termination of the NDA. This clause aims to strike a balance between safeguarding the disclosing party's intellectual property and safeguarding the recipient party from unreasonable restrictions on their operations. In Iowa, there are different variations of the Residuals Clause that can be included in a Basic Nondisclosure Agreement, depending on the specific circumstances and the level of confidentiality required. Some common types of Iowa Residuals Clauses that may be utilized are: 1. Standard Residuals Clause: This is the most commonly used form of the clause, stating that the recipient party shall not be liable for any use or disclosure of the confidential information that is a result of lawful acquisition or independent development. 2. Narrow Residuals Clause: This variation sets stricter conditions, limiting the scope of what can be considered "residuals." It specifies that only information that is specifically recalled and documented by the recipient party can be excluded from the obligations of confidentiality. 3. Permitted Use Residuals Clause: This type of clause outlines specific permitted uses of the confidential information by the recipient party, even after the termination of the NDA. It can include provisions such as using the information for research and development purposes or as reference material for future projects. 4. Source Code Residuals Clause: In technology-related agreements, such as software development or licensing, a specialized Residuals Clause may be used that specifically addresses the treatment of source code. It may account for the fact that code fragments or generic knowledge may be retained by the recipient party and not be considered confidential. It is important to consult with legal professionals familiar with Iowa state law when drafting an NDA and customizing the Residuals Clause. They can provide guidance on the appropriate type of clause to include based on the unique circumstances of the agreement and the level of confidentiality required. An effectively crafted Residuals Clause not only protects the disclosing party's valuable information but also ensures a fair and practical approach to the recipient party's use of the disclosed information in the future.
