Free Non Disclosure Agreements for Businesses

							NON DISCLOSURE /                               information to another party but needs the
CONFIDENTIALITY AGREEMENTS                     information to remain secret for some
                                               reason, perhaps due to secrecy
A non-disclosure agreement (NDA), also         requirements required to satisfy patent
known as a confidentiality agreement,          laws or to make sure that the other party
confidential disclosure agreement (CDA)        does not take and use the disclosed
or secrecy agreement, is a legal contract      information without compensating the
between at least two parties that outlines     discloser. A non-disclosure agreement can
confidential material, knowledge, or           protect any type of information that is not
information that the parties wish to share     generally known, and there are a number
with one another for certain purposes, but     of places where one can find royalty free
wish to restrict access to by third parties.   non-disclosure agreement templates for
It is a contract through which the parties     use.
agree not to disclose information covered
by the agreement. An NDA creates a             Another type of non-disclosure agreement
confidential relationship between the          is one that is a mutual agreement.
parties to protect any type of confidential    Mutual agreements are much like
and proprietary information or trade           unilateral agreements, but both parties
secrets. As such, an NDA protects non-         will be supplying information that is
public business information.                   intended to remain secret. This type of
                                               agreement is far more common when
NDAs are commonly signed when two              businesses are considering some kind of
companies, individuals, or other entities      joint venture or merger.
(such as partnerships, societies, etc.) are
considering doing business and need to         The non-disclosure agreement typically
understand the processes used in each          only requires the receiving party to
others business for the purpose of             maintain information in confidence when
evaluating    the    potential     business    that information has been directly
relationship. NDAs can be "mutual",            supplied by the disclosing party.
meaning both parties are restricted in their
use of the materials provided, or they can     Some common issues addressed in an
restrict the use of material by a single       NDA include:
party.                                         a. outlining the parties to the agreement;
                                               b. the definition of what is confidential,
The first step to determining the                 i.e. the information to be held
appropriate content for a non-disclosure          confidential. which are covered,
agreement is to determine the type of             including        unpublished       patent
agreement that you need. Most                     applications, know-how, schema,
agreements tend to be one-way                     financial       information,       verbal
agreements, or unilateral agreements,             representations, customer lists, vendor
where one party wants to disclose certain         lists, business practices/strategies, etc;
c. the exclusions from what must be kept       Key Points for drafting NDAs:
   confidential. Typically, the restrictions
   on the disclosure or use of the             1. Documents Marked Confidential or
   confidential data will be invalid if           Proprietary (verbal communications
   • the recipient had prior knowledge            confirmed in writing). Company
       of the materials;                          practice is to require information be
   • the recipient gained subsequent              marked confidential.
       knowledge of the materials from
       another source;                         2. What information is confidential?
   • the materials are generally                  What is the Purpose?
       available to the public; or                Some NDAs contain blanks where
d. provisions restricting the transfer of         either party may describe what
   data in violation of national security;        confidential information they expect
e. the term (in years) of the                     to exchange. It will limit the number
   confidentiality, i.e. the time period of       of back and forth e-mails if the
   confidentiality;                               recipient communicates in advance
f. the term (in years) the agreement is           what information they expect to
   binding;                                       exchange. For a limited purpose NDA,
g. permission      to     obtain   ex-parte       the description may be narrow. For a
   injunctive relief;                             NDA that will last through a longer
h. the obligations of the recipient               term relationship, the description
   regarding the confidential information,        should be broader. The broader the
   typically including some version of            description from either party, the
   obligations:                                   harder it will be to monitor and
   • to use the information only for              control. Similarly, some NDAs state
       enumerated purposes;                       the “purpose” for the NDA which may
   • to disclose it only to persons with          be broad (e.g., “evaluate transaction
       a need to know the information for         between the parties”) or narrow (e.g.,
       those purposes;                            “develop and evaluate specifications
   • to use appropriate efforts (not less         for project X”).
       than reasonable to keep the
       information secure.
   • types of permissible disclosure -
       such as those required by law or
       court order.