Nondisclosure Agreement

Non-disclosure agreements are an important legal framework used to protect sensitive and confidential information from being made available by the recipient of that information. Companies and startups use these documents to ensure that their good ideas won't be stolen by people they are negotiating with.

A non-disclosure agreement (NDA), sometimes referred to as a confidentiality agreement, is a written contract between two parties (people or organizations) that prohibits the sharing of confidential information that has been revealed to them.

NDAs keep people from sharing trade secrets, proprietary knowledge, client information, product information, and strategic plans. NDAs keep people from making a profit on any secret company information. NDAs usually say that a company owns things that get developed or produced during someone's employment.

NDAs are legally enforceable contracts, but they're now coming under increased scrutiny from lawmakers, attorneys and legal experts.Companies often use them as part of an employment contract or settlement agreement to protect sensitive information like trade secrets.

The NDA should clearly state the start and end date for the period of time in which the information may be exchanged between the parties. For example, you may wish to trade confidential information only at the start of the business collaboration. State the dates specifically.

Publicly available information. Information you already possess or may acquire on your own. Information you can prove you learned of independent of the protected information provided for under the NDA. Information received by a 3rd party source.

A definition of confidential information. Who is involved. Why the recipient knows the information. Exclusions or limits on confidential information. Receiving party's obligations. Time frame or term. Discloser to the recipient.

No matter the size of your business, being able to rely on your employees and partners is critical for maintaining peace of mind. Using NDAs to legally ensure that vital information remains private reinforces trust.

Identification of the parties. Definition of what is deemed to be confidential. The scope of the confidentiality obligation by the receiving party. The exclusions from confidential treatment. The term of the agreement.