Mutual Nondisclosure Agreement

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									Mutual Non-Disclosure
Agreement Template
This Mutual Non-Disclosure Agreement is made between two parties to keep certain
information confidential when exploring a business opportunity. Confidential information
includes, but is not limited to, patents, trade secrets, business plans, designs,
copyrighted work, ideas, discoveries, and models. Furthermore, the agreement
establishes which information is excluded from the confidentiality requirement. It
contains standard terms and conditions commonly found in these types of agreements.
This should be used by small businesses to protect the confidentiality of their proprietary
       THIS AGREEMENT is made effective as of the date of the last signature below, by and
between _____ [Instruction: Insert first company’s name], a _____ [Instruction: Insert state
company is incorporated in if applicable] ccorporation, having its principal place of business
at ________ [Instruction: Insert first company’s principal business address] (“Company”)
and ______________________________________, [Instruction: Insert second company’s
name] a ______________ [Instruction: Insert state 2n company is incorporated in]
corporation   (“Third    Party”)    having    its  principal    place     of    business    at
_____________________________________________________________ [Instruction: Insert
second company’s principal business address]

1.     Purpose

        Company and Third Party wish to explore a business possibility under which each may
disclose all or a portion of its Confidential Information to the other.

2.     Definition the term “Confidential Information”

         “Confidential Information” means any information, technical data, or know-how,
including, but not limited to, that which relates to research, products, services, customers,
markets, software, developments, inventions, processes, designs, drawings, engineering,
marketing, or finances disclosed orally or in written or electronic form, which is marked or
identified by the disclosing party as “proprietary” or “confidential.” Confidential Information
does not include information, technical data, or know-how that which is: (i) in the possession of
the receiving party at the time of disclosure, as shown by the receiving party’s files and records
immediately prior to the time of disclosure, (ii) not as a result of any inaction or action of the
receiving party prior to or after the time the disclosure becomes part of the public knowledge or
literature, (iii) is approved for release by the disclosing party, or (iv) is independently developed
by the receiving party without the use of any Confidential Information of the other party.
[Comment: Parties should carefully consider whether or not they wish to include trade
secret information within the definition of “Confidential Information.” If so, care should
be taken to ensure proper language is included herein and protocols are developed to
ensure the protection of such trade secrets]

3.     Non-Disclosure of Confidential Information

        Company and Third Party each agree not to use Confidential Information disclosed to it
by the other party for its own use or for any purpose except to carry out discussions concerning
and the undertaking of any business relationship between the two. Neither party will disclose the
Confidential Information of the other to third parties or to the first party’s employees, except
employees who are required to have the information in order to carry out the contemplated
business. Each party has had or will have employees to whom Confidential Information of the
other is disclosed, sign a Non-Disclosure Agreement in content substantially similar to this
Agreement and will notify the other party in writing of the names of the persons who have had
access to Confidential Information of the other party. Each party agrees that it will take all
reasonable steps to protect the secrecy of and avoid disclosure or use of Confidential Information
of the other in order to prevent it from falling into the public domain or the possession of
unauthorized persons. Each party agrees to notify the other in writing of any misuse or
misappropriation of Confidential Information of the other that may come to such party’s
attention. [Instruction: to include any specialized instructions or precautions regarding the
retention of materials to be taken, including, for example, whether or not same must be
retained in a separate, locked filing cabinet or room, and who will have access to the keys
or other access device to such cabinet or room]

4.     Return of Materials

        Any materials or documents which have been furnished by one party to the other will
be promptly returned, accompanied by all copies of such documentation, after the business
possibility has been rejected or concluded. No party with access to the other party’s Confidential
Information shall be permitted to retain, copy, or otherwise store any of the other party’s
Confidential Information, including by any hard copy or any electronic file, forwarding by any
electronic means, storing on any hard drive or portable hard drive or through any other method.

5.     Intellectual Property Rights

        Nothing in this Agreement is intended to grant any rights under any patent, trademark,
trade secret, or copyright of either party, nor shall this Agreement grant either party any rights in
or to the other party’s Confidential Information, except the limited right to review such
Confidential Information solely for the purposes of determining whether to enter into the
proposed business relationship between the parties and carrying out such relationship. The
disclosing party warrants that it has the right to disclose its Confidential Information to the
receiving party. Otherwise, all information is provided “as is” and without any warranty,
express, implied or otherwise, regarding its accuracy or performance.

5.     Export Controls

        Each recipient of Confidential Information agrees that it will not export outside the
United States, if a United States company or citizen, or re-export, if a foreign company or
citizen, any Confidential Information or direct product thereof, except as permitted by the laws
and regulations of the United States or foreign country with jurisdiction over them and by the
disclosing party in writing.

6.     Independent Development

        Each disclosing party understands that the receiving party may currently or in the future
develop information internally, or receive information from other parties that may be similar to
the disclosing party’s Confidential Information. Accordingly, nothing in this Agreement shall be
construed as a representation or inference that the receiving party will not develop products, or
have products developed for it, that compete with the products or systems contemplated by the
disclosing party’s confidential information except as set forth herein.

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7.     Term

        This Agreement may be terminated at all times with ____ (__) days prior written notice,
provided however, that the confidentiality obligations herein shall terminate ____ (__) [Option:
Parties should insert a term that realistic, given the industry standard and rate of
technology change] years following the date of disclosure. [Option: Parties should consider if
there is a term in which to return materials]

8.     Miscellaneous

        This Agreement shall be binding upon and for the benefit of the undersigned parties, their
successors, and assigns, provided that Confidential Information may not be assigned without
consent of the disclosing party. Failure to enforce any provision of this Agreement shall not
constitute a waiver of any term hereof. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of _____ [Instruction: Insert state to govern]
as they apply to contracts entered into and wholly be performed in the State of _____
[Instruction: Insert state to govern]. The federal and state courts within the State of _____
[Instruction: Insert state to govern] shall have exclusive jurisdiction to adjudicate any dispute
arising out of this Agreement.

9.     Remedies

        Each party agrees that its obligations hereunder are necessary and reasonable in order to
protect the other party and the other party’s business and Confidential Information, and expressly
agrees that monetary damages would be inadequate to compensate the other party for any breach
of any covenant or agreement set forth herein. Accordingly, each party agrees and acknowledges
that any such violation or threatened violation will cause irreparable injury to the other party and
that, in addition to any other remedies that may be available in law, at equity, or otherwise, the
other party shall be entitled to obtain injunction relief against the threatened breach of the
Agreement or any continuation of any such breach, without the necessity of proving actual

10.    Notices

        All notices hereunder shall be sent to either party at the address and to the contact person
specified below, or to such other address or contact as the respective party may specify from
time to time in accordance with the provisions herein.

10.    Descriptive Headings

        The descriptive headings used herein are for convenience of reference only and are not
intended to have any affect whatsoever in determining the rights or obligations of the parties

11.    Severability

© Copyright 2013 Docstoc Inc.                                                              3
        If any provision of this Agreement or the application thereof shall, for any reason and to
any extent, be invalid or unenforceable, neither the remainder of this Agreement nor the
application of the provision to other persons, entities, or circumstances shall be affected thereby,
but instead shall be enforced to the maximum extent permitted by law.

12.    Construction

       The pronouns used herein shall include, where appropriate, either gender or both,
singular and plural.



                                                     “THIRD PARTY”


© Copyright 2013 Docstoc Inc.                                                              4

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