Free Non-Disclosure Agreement

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Whenever sensitive information needs to be shared between two parties it is a good idea
to use a confidentiality or non-disclosure agreement. This agreement will help formalize
the relationship and provide legal remedies if the confidential information is released.

Non-Disclosure Agreement Template

Alternate Names:

A Non-Disclosure Agreement is also known as a/an:

  • NDA
  • Confidentiality Agreement
  • Confidentiality Disclosure Agreement
  • Secrecy Agreement

What is a Non-Disclosure Agreement?

A Non-Disclosure Agreement, or NDA, is a contract that protects someone's private and proprietary information from being shared with anyone who should not have access it. Often, this is the case when one party is divulging trade secrets or private business practices to another party, and the divulging party doesn't want those secrets or practices to be shared with the public or anyone outside of the contracted relationship.

An NDA protects the party who is sharing information (such as an inventor or employer) and prohibits the other party (like a buyer or employee) from revealing the information to anyone else.

What is confidential information?

Confidential information means, in the business context, all non-public information relating to the company's affairs and business.

An NDA can be used for a variety of confidential information, such as:

  • Customer information and data like names, contact information, or purchase histories
  • Intellectual property that is a result of creativity like manuscripts, inventions, or new trade procedures that one might copyright, patent, or trademark
  • Marketing practices, service procedures, and product information
  • Accounting or business contact information (e.g. suppliers names and information)
  • Business strategies or goals
  • Business development plans
  • Profit margins and projections
  • Technical "know-how" and production methods
  • Work, research, data, products, etc. developed by employees through the course of their employment which is proprietary to the company

Confidential Information is also generated as a result of privileged consultations with professionals such as lawyers and doctors and such data is subject to data protection laws.

What is a Non-Disclosure Agreement for?

There are three main types of NDAs:

  • Employee Non-Disclosure Agreement: used when an employer divulges business, client, or trade information to an employee, contractor, or consultant, or to an applicant for one of those roles
  • Non-Disclosure Agreements for inventions: used to protect intellectual property when inventions of creativity such as products, blueprints, designs, or practices are disclosed to another party as part of a professional relationship
  • NDAs for business transactions: used to facilitate commercial due diligence when the prospective seller of a business discloses information about employees, clients, business practices, trade secrets, profits, and losses to a would-be purchaser

Mutual Non-Disclosure Agreements can be used in any of these circumstances. Mutual NDAs protect both parties so that neither party can disclose the other's sensitive information to anyone outside of the contract.

How long is a Non-Disclosure Agreement valid for?

NDAs can be ended on any date within reason depending on the specifications of the contract. Generally, if and when the information becomes public (by means other than a breach of the confidentiality agreement) the information loses its confidentiality, so the information in the NDA will no longer be privileged.

The parties receiving confidential information are usually required to keep track of all the information they have been entrusted with, and the information remains proprietary to the disclosing party who can demand the return of the information at any time. In such a case, the receiver will have to return all the information, destroy any copies (including notes and memoranda pertaining to the information), and will have to provide certification that the materials have been destroyed.

Why do I need a Non-Disclosure Agreement?

NDAs are useful when entering into any of the following relationships:

  • Buying someone's business or selling your own
  • Hiring a new employee, contractor, or consultant
  • Creating, testing, evaluating, and promoting new inventions, and becoming involved in a business relationship (with an investor for instance) where information about the inventions would need to be shared with another party

Related Documents:

  • Employment Contract: a contract between an employer and an employee that details the terms of employment like salary, benefits, and duties
  • Purchase of Business Agreement: a document used to transfer the ownership of a business from one party to another
  • Employment Offer Letter: a letter setting out terms of employment
  • Partnership Agreement: a document setting out the terms of a partnership and the rules which govern it
  • Joint Venture Agreement: a contract used to set up a business arrangement between two or more parties who agree to combine resources for a limited time to accomplish a particular project or goal

Frequently Asked Questions:

Non-Disclosure Agreement FAQ
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