business plan nda template

• Non-Disclosure Agreement /
• Business Plan

Business Plan Non-Disclosure Agreement

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A business plan non-disclosure agreement (NDA) is a form used by businesses to permit a 3rd party (be it a person or company) to view their business plan without the fear of the 3rd party sharing the contents of their plan with other entities. Business plans contain a massive amount of information regarding the disclosing company. The document typically includes financials, pricing, short and long-term strategies, goals, competitive advantages, and information on their customers, to name a few. In short, a company’s business plan going public could be severely damaging to their ability to compete in the market.

A business may share their business plan to those interested in purchasing their company, to investors (for the purpose of receiving funding), bankers, and lawyers, to name a few. While an NDA can go a long way in preventing their plan from going leaked to other parties, nothing is ever 100% secure. A company should only go about sharing their business plan if there is a necessary reason for doing so.

How to Write

Step 1 – Download

Save the template in PDF , WORD , or RTF .

Step 2 – Identifying the Parties

On the first line of the document, write the name of the company (or individual) sharing the business plan. If a company, the full legal name of the entity should be listed. On the next line, enter the name of the entity receiving permission to view the business plan. As before, this can be a person or a business.

Step 3 – Applicable Law

Enter the names of the county and state in which the NDA will be legally covered.

Step 4 – Signature

The only signature required for the form is that of the 3rd party. In addition to their signature, they will need to record the date in which they signed the document followed by their printed name.

Business Plan Non-Disclosure Agreement (NDA) Template

The business plan non-disclosure agreement is a document that restricts any individual from divulging proprietary information that is shared through a business plan. Lets say for example, that an entrepreneur is starting a new company and would like to run their idea by a colleague or friend, the only legal way for that business plan to be kept confidential is by the 3rd party to sign a non-disclosure. If after signing the agreement the Recipient of the business plan shares the information contained in it with anyone else the entrepreneur that created the business plan would be entitled to seek damages usually resulting in a monetary gain.

How to Write

Step 1 – Download in Adobe PDF or Microsoft Word (.docx) .

Adobe PDF – Microsoft Word (.docx)

Step 2 – In the 1st paragraph write the name of the business or individual that is sharing the business plan.

Step 3 – Enter the name of the person or entity that is receiving the business plan.

Step 4 – The person or entity that received the plan must sign , print , and date on the bottom of the form. After the signature of the receiving party the agreement is complete.

• Financial Non-Disclosure Agreement (NDA) Template
• Business Sale Non-Disclosure Agreement (NDA) Template
• Unilateral Non-Disclosure Agreement (NDA) Template
• Louisiana Non-Disclosure Agreement (NDA) Template
• Pennsylvania Non-Disclosure Agreement (NDA) Template
• New Hampshire Non-Disclosure Agreement (NDA) Template

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Non-Disclosure Agreement (NDA) Template

Use our non-disclosure agreement to protect your confidential information from unauthorized disclosure.

• 4.7 1,111 Ratings

Updated September 4, 2024 Written by Josh Sainsbury | Reviewed by Brooke Davis

A non-disclosure agreement (NDA) is a contract between two parties in which one party shares confidential information and the other promises not to disclose it. Confidential information is often sensitive, technical, commercial, or valuable in nature (e.g., trade secrets or proprietary information). Both parties sign the NDA, creating a binding contract to keep the information secret.

Non-Disclosure Agreement – By State

• Connecticut
• District of Columbia
• Massachusetts
• Mississippi
• New Hampshire
• North Carolina
• North Dakota
• Pennsylvania
• Rhode Island
• South Carolina
• South Dakota
• West Virginia
• Types of Non-Disclosure Agreements

Basic/Standard Confidentiality Agreement

Unilateral (One-Way)

Independent Contractor

HIPAA Employee

Business Associate

Business Plan

Business Sale

Financial Information

Landlord-Tenant

Real Estate Buyer

Commercial Real Estate

Movie (Film)

Patent/Invention

Trade Secret

Software Development

Website Design

Product Development

• Non-Disclosure Agreement - By State

What Is a Non-Disclosure Agreement?

Purpose of a non-disclosure agreement, when to use a non-disclosure agreement, is an nda legally binding and enforceable, what should an nda include, how long does an nda last, how to enforce an nda, consequences of breaking an nda, sample non-disclosure agreement.

A non-disclosure agreement (NDA) is a legally binding document that creates a confidential relationship between the disclosing and receiving parties. It prevents the receiving parties from revealing sensitive information to unauthorized third parties. The parties entering this agreement refer to it to understand the terms under which they must keep the outlined information private.

What's the Difference Between a Non-Compete and a Non-Disclosure Agreement?

The main difference between a non-compete and a non-disclosure agreement is the business activities they intend to restrict.

• A non-compete agreement prohibits one party from doing business that competes with the other party .
• A non-disclosure agreement aims to prevent one or both parties from using or leaking sensitive information learned in negotiations or business relationships.

The FTC recently issued a Final Rule to ban all non-compete agreements by September 4, 2024. However, a district court stopped the enforcement of this rule, so non-competes are still permitted. The FTC has until October 19 to appeal this decision.

The purpose of an NDA is to keep trade secrets, confidential information, and proprietary information safe from unauthorized disclosure . This document encourages open communication by allowing the parties to freely share important information knowing that the other party won’t misuse it.

An NDA also clarifies confidentiality obligations, secures intellectual property, protects trade secrets, and provides legal recourse in case one party breaches its promise. It sets the legal framework to protect intellectual property and information from being stolen, sold, or shared with third parties, such as business competitors.

Situations when a company may use an NDA include the following:

• Business negotiations: An NDA protects proprietary information that parties share during negotiations to enter a potential partnership , joint venture , acquisition, or merger.
• Employment: Employers may require employees to sign an NDA to safeguard confidential business information that the employee has access to while they work.
• Contractor and vendor relationships: An NDA prevents contractors and vendors with access to sensitive information from disclosing it.
• Product development: Using an NDA when sharing details about new products or innovations with potential collaborators and investors helps prevent idea theft.
• Franchising: An NDA protects the franchisor’s proprietary business model, strategies, and processes when they share opportunities with potential franchisees.
• Startups: Startups often use NDAs when pitching to investors to protect their proprietary technology, financial projections, and business plans .

For example, in a business context, imagine a startup tech company, InnoTechHive, developing a groundbreaking software solution. Before entering into discussions with potential investors, InnoTechHive requires them to sign an NDA to safeguard their proprietary algorithms and business strategies.

By signing the NDA, the investors agree not to disclose or use any confidential information shared during the discussions for their own benefit or to the detriment of InnoTechHive. This ensures that the startup can freely discuss any innovative ideas without fear of intellectual property theft, preserving its competitive advantage in the market.

Yes. NDAs are enforceable once signed . However, the following conditions must be true:

• The parties mutually agree to all its terms.
• The NDA provides a clear definition of the confidential information that the receiving party must not disclose.
• The parties created the NDA for a legitimate purpose (i.e., not to conceal illegal activity).
• The NDA specifies a reasonable scope and duration.
• The NDA contains some type of consideration. For example, the consideration can be the mutual exchange of sensitive information.
• All parties must enter the agreement willingly and have the legal capacity to do so.

If these conditions are true, the agreement is enforceable. The parties can pursue legal action and seek appropriate remedies if the other breaches the terms.

Here are the key elements that an NDA should include:

• Parties involved: Name the disclosing and receiving parties. The “Disclosing Party” is the individual or entity sharing information. The “Receiving Party” is the individual or entity receiving information.
• Transaction: Explain the potential business relationship that the disclosing and receiving parties want to enter.
• Confidential information: Define confidential information for your specific agreement. You may define all information the disclosing party shares as confidential. Alternatively, you can define it only as information specifically marked as “Confidential” or information relating to a specific topic, such as “Accounting Information” or “Customer Information.”
• Furthermore, the obligation doesn’t apply if the receiving party has prior written consent to disclose the information.
• Obligations: Explain the receiving party’s obligations. For example, you may require them to maintain specific security processes and procedures to keep sensitive information confidential. You may also require them to refrain from mentioning they’re discussing or negotiating a transaction with the disclosing party.
• Non-compete clause: Decide if you want to include a non-compete clause in which you limit the receiving party’s work relationship with competing companies.
• Non-solicitation clause: Restrict the receiving party’s ability to solicit employees or independent contractors from the disclosing party.
• Termination date: Determine when the agreement will end, whether it be upon the consummation of the “Transaction” or after a certain length of time passes. You can also state that the agreement will end when the parties write and sign a separate written agreement.
• Remedies : Stipulate the consequences of breaking the NDA
• No license:  Explain that the NDA doesn’t give either party any patent, copyright, or ownership of the information provided.
• Severability : State that if one part of the NDA is ruled invalid in court, that part will be removed, and the rest of the agreement remains valid.
• Amendments : Explain that either party can amend the NDA if they acquire a written agreement with both parties’ signatures.
• Jurisdiction: The jurisdiction clause establishes which state’s laws govern the NDA. Suppose confidential information is leaked or inappropriately used by one party, and a lawsuit ensues. In that case, the laws of the agreed-upon state will apply, and any trials or hearings will occur there.
• Signatures: Your NDA needs to include the signatures of all parties and their representatives. Representatives are other people (i.e., directors, officers, employees, agents, or advisors) who may share, receive, or protect the information in pursuit of the transaction specified in the NDA.

Examples of Confidential Information

Here are examples of confidential information to specify in your NDA:

• Special formulas
• Instruments
• Software development
• Technical designs
• Customer lists or client information
• Patent details
• Affiliate deals
• Pricing structures
• Business and financial records

An NDA can last several months to years, depending on the sensitivity of the information shared and the parties’ agreement. Both parties should agree on a timeframe that accounts for the protection of sensitive information and practical business considerations .

Some NDAs can be indefinite if the parties’ arrangement involves an ongoing relationship or the value of a highly sensitive trade secret lasts indefinitely. However, it’s best practice to let the NDA expire after a specific period. This way, the receiving party can’t argue that the agreement is unreasonable or overly restrictive.

Step 1 – Review the NDA

Review the NDA to confirm that the disclosing party has committed a breach. Ensure that their obligations haven’t expired and that they didn’t disclose information within the guidelines in the document.

Step 2 – Gather Evidence of the Breach

Gather evidence of the breach to prove it occurred. Examples of potential evidence include unauthorized letters, emails, social media posts, publications, file transfers, or data downloads. Confirm that the evidence shows a clear misuse or unauthorized disclosure of the information involved.

Step 3 – Assess the Breach’s Impact

Evaluate the breach’s impact on your company’s operations or interests. This way, you can understand the extent of the damage and decide what remedies to seek.

Step 4 – Notify the Receiving Party

Notify the receiving party of the breach. Use a cease and desist letter to demand they stop sharing the information or unpublish specific data. Sometimes, a simple reminder can be enough to get them to comply.

Step 5 – Seek Mediation or Arbitration

If your NDA includes specific dispute resolution procedures, follow them. Start with mediation, as you may be able to resolve the dispute with a mediator to facilitate the discussion. You may also try arbitration to engage a third party who can reach a legally binding decision.

Step 6 – Seek Legal Action

If you can’t resolve the breach with mediation or arbitration, talk to an attorney with experience in contract law. You may be able to prepare a complaint and file a lawsuit. If you win, you may be awarded remedies, such as injunctive relief or monetary damages.

Step 7 – Update the NDA

Review and update the NDA to enhance its clarity and address any uncertain provisions. Update the writing process for future NDAs to prevent similar breaches in the future.

Here are the potential consequences of breaking an NDA:

• Monetary damages: The original disclosing party may seek monetary compensation for any financial losses the breach caused. This monetary compensation may include punitive, consequential, or direct damages.
• Injunctive relief: A court may order the original receiving party to stop disclosing the private information.
• Specific performance: A court may order the original receiving party to comply with the NDA’s terms.
• Legal fees: The original receiving party may have to pay legal fees and costs incurred by the original disclosing party.
• Damaged reputation: The original receiving party may experience a decline in their professional reputation.
• Loss of business opportunities: The breaching party may lose current and future business opportunities because of the contract breach.
• Re-negotiation: The original disclosing party may terminate the NDA, requiring the receiving party to re-negotiate a new agreement.

Can You Break an NDA to Report a Crime?

While you can break an NDA to report a crime , it’s best to thoroughly consider all your options first.

Download a free non-disclosure agreement template in PDF or Word format below:

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Non-Disclosure Agreement (NDA) Template – Sample

Non-disclosure agreements are legal contracts that prohibit someone from sharing information deemed confidential. The confidential information is defined in the agreement which includes, but not limited to, proprietary information, trade secrets, and any other details which may include personal information or events.

Adobe PDF , Microsoft Word (.docx)

Table of Contents

• NDA:  Standard Template
• NDA:  Types
• NDA:  Sample
• Trade Secret Examples

How to Write an NDA

Types of nda’s.

Basic / Standard NDA – Use when disclosing secrets to a contractor, a potential investor, or a prospective business partner.

Business Plan NDA – When showing a business plan to a third (3rd) party such as a potential investor.

Business Sale NDA – Use when you’re engaged in business negotiations. For example, merger or investment discussions, negotiations about joint ventures or talks with consultants or potential licensees.

Cease and Desist Letter (NDA Violation) – To send to an individual that has violated an NDA that was previously authorized.

Commercial Real Estate NDA (Confidentiality) – When a landlord is seeking to sell or lease their property this agreement would be signed by all potential buyers or tenants.

Customer List NDA – For companies that sell their customer lists to other entities.

Employee NDA – Makes clear to an employee that he or she may not disclose your trade secrets without permission

Film (Movie) NDA – To share a script with producers, directors, and actors.

Financial Information NDA – To disclose personal or business financial information to a third (3rd) party.

HIPAA Employee NDA – For employees of healthcare facilities to agree that they will not share medical information of the patients.

Independent Contractor NDA – Also referred to as a 1099 employee, is for contractors that will have access to sensitive information.

Intern (Internship) NDA – For an intern that is serving a temporary position.

Job Interview NDA – You may end up divulging trade secrets when interviewing prospective employees, especially for sensitive jobs. Any person you hire should be required to sign an employee NDA (or an employment agreement containing a nondisclosure provision). But, of course, the interviewees you don’t hire won’t be signing an employment NDA or employment agreement. For this reason, have applicants for sensitive positions sign a simple nondisclosure agreement at the beginning of a job interview.

Landlord-Tenant NDA – In order for the landlord to safely handover information about the property to the tenant.

Mutual NDA – Also known as a “2-way NDA”, allows for two (2) parties to share trade secrets while both being bound to keep the information private.

Patent (Invention) NDA – Specifically written to protect a patent or invention from employees, contractors, or any other third (3rd) party from sharing or copying the concept.

Product Development NDA  – To protect a product in its early stages before being able to file for a patent.

Real Estate Buyer NDA – For a landlord that will be disclosing pertinent financial information to a potential buyer.

Software Beta Tester NDA – If you develop software (including Web applications) and give beta versions to outside testers, here is a nondisclosure agreement for you to use.

Software Development NDA – To protect oneself from coders and programmers so that they do not steal an idea or reuse the coding or design.

Student NDA – For a student of a college or university that is to be working within its internal administration and affairs.

Trade Secret (Specific) NDA – If a specific trade secret or piece of information is to be kept confidential.

Unilateral NDA – For any type of NDA where only one (1) party will be responsible for keeping the information a secret.

Visitor NDA – For any guest that is visiting a business. They will not be able to share the things they see on their tour.

Volunteer NDA – For any guest or individual that is agreeing to work without pay.

Website Design NDA – To have a designer promise not to share the logos or design practices that they use on your website.

This Nondisclosure Agreement (the “Agreement”) is entered into by and between _______________ with its principal offices at _______________, (“ Disclosing Party “) and _______________, located at _______________ (“ Receiving Party “) for the purpose of preventing the unauthorized disclosure of Confidential Information as defined below. The parties agree to enter into a confidential relationship with respect to the disclosure of certain proprietary and confidential information (“Confidential Information”).

1.    Definition of Confidential Information . For purposes of this Agreement, “Confidential Information” shall include all information or material that has or could have commercial value or other utility in the business in which Disclosing Party is engaged. If Confidential Information is in written form, the Disclosing Party shall label or stamp the materials with the word “Confidential” or some similar warning. If Confidential Information is transmitted orally, the Disclosing Party shall promptly provide a writing indicating that such oral communication constituted Confidential Information.

2.    Exclusions from Confidential Information.  Receiving Party’s obligations under this Agreement do not extend to information that is: (a) publicly known at the time of disclosure or subsequently becomes publicly known through no fault of the Receiving Party; (b) discovered or created by the Receiving Party before disclosure by Disclosing Party; (c) learned by the Receiving Party through legitimate means other than from the Disclosing Party or Disclosing Party’s representatives; or (d) is disclosed by Receiving Party with Disclosing Party’s prior written approval.

3.    Obligations of Receiving Party . Receiving Party shall hold and maintain the Confidential Information in strictest confidence for the sole and exclusive benefit of the Disclosing Party. Receiving Party shall carefully restrict access to Confidential Information to employees, contractors and third parties as is reasonably required and shall require those persons to sign nondisclosure restrictions at least as protective as those in this Agreement. Receiving Party shall not, without the prior written approval of Disclosing Party, use for Receiving Party’s own benefit, publish, copy, or otherwise disclose to others, or permit the use by others for their benefit or to the detriment of Disclosing Party, any Confidential Information. Receiving Party shall return to Disclosing Party any and all records, notes, and other written, printed, or tangible materials in its possession pertaining to Confidential Information immediately if Disclosing Party requests it in writing.

4.    Time Periods.  The nondisclosure provisions of this Agreement shall survive the termination of this Agreement and Receiving Party’s duty to hold Confidential Information in confidence shall remain in effect until the Confidential Information no longer qualifies as a trade secret or until Disclosing Party sends Receiving Party written notice releasing Receiving Party from this Agreement, whichever occurs first.

5.    Relationships.  Nothing contained in this Agreement shall be deemed to constitute either party a partner, joint venturer or employee of the other party for any purpose.

6.   Severability . If a court finds any provision of this Agreement invalid or unenforceable, the remainder of this Agreement shall be interpreted so as to best to effect the intent of the parties.

7.    Integration . This Agreement expresses the complete understanding of the parties with respect to the subject matter and supersedes all prior proposals, agreements, representations, and understandings. This Agreement may not be amended except in a writing signed by both parties.

8.    Waiver . The failure to exercise any right provided in this Agreement shall not be a waiver of prior or subsequent rights.

9.   Notice of Immunity [OPTIONAL] . Employee is provided notice that an individual shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made (i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. An individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual (i) files any document containing the trade secret under seal; and (ii) does not disclose the trade secret, except pursuant to court order.

This Agreement and each party’s obligations shall be binding on the representatives, assigns and successors of such party. Each party has signed this Agreement through its authorized representative.

DISCLOSING PARTY

Signature _____________________________________________________

Typed or Printed Name ___________________________ Date: _______________

RECEIVING PARTY

Trade Secrets

An NDA can help safeguard business assets, including but not limited to, the following:

Chemical, mechanical and manufacturing processes are commonly protected under nondisclosure agreements. Examples include processes for manufacturing chocolate powder, chicken pox vaccine or marble picture frames.

• Business Strategies and Methods

Business strategies such as marketing schemes, advertising campaigns, business plans and new product announcements can be protected as trade secrets. For example, courts have held that marketing strategies for the sale of propane gas and a business plan for a new franchise are trade secrets. A business method, a manner of conducting business or a way of doing business, is also a protectable trade secret. Examples include a system for analyzing mortgage rates or a process for instructing employees.

• Designs Blueprints and Specifications

Designs for products, machines, and structures, or other manufacturing specifications, can be protected as trade secrets. Examples include the design for a photo-processing machine, the blueprint for a casino or specifications for a paint roller.

Formulas are an obvious choice for trade secret protection—the most well-known is the secret combination of flavoring oils and other ingredients that give Coca-Cola its distinctive taste (referred to by the company as “Merchandise 7X”). Other formulas that could be protected as trade secrets include pharmaceutical, chemical and cosmetic compounds.

• Physical Devices and Articles

Physical devices such as machines, devices or objects can be subject to trade secret protection. Usually, trade secret protection is lost once the device is made public, but protection may enable you to protect it before obtaining a patent or while attempting to sell or license the product.

• Computer Software

Computer software is commonly protected under trade secret law because the underlying software code is not readily ascertainable or generally known. A computer program often qualifies for trade secret status during its development and testing stage. (It may also qualify for protection under copyright or patent law.)

• Customer Lists

Companies are often very eager to protect their customer lists with NDAs, particularly when a former employee might use a customer list to contact clients. If a dispute over a customer list ends up in court, a judge generally considers the following elements to decide whether or not a customer list qualifies as a trade secret:

• Is the information in the list ascertainable by other means? A list that is readily ascertainable cannot be protected.
• Does the list include more than names and addresses? For example, a customer list that includes pricing and special needs is more likely to be protected because this information adds value.
• Did it take a lot of effort to assemble the list? A customer list that requires more effort is more likely to be protected under an NDA.
• Did the departing employee contribute to the list? If the departing employee helped create it or had personal contact with the customers, it is less likely to be protected under an NDA.
• Is the customer list personal, long-standing or exclusive? If a business can prove that a customer list is special to its business and has been used for a long time, the list is more likely to be protected.

Customer List – Example 1 : A salesman worked for an insurance company selling credit life insurance to automobile dealers. When he switched jobs to work for a competing insurance company he took his customer list and contacted the customers at his new job. A court ruled that the customer list was not a trade secret because the names of the automobile dealers were easily ascertainable by other means and because the salesman had contributed to the creation of the list. Lincoln Towers Ins. Agency v. Farrell, 99 Ill. App. 3d 353, 425 N.E.2d 1034 (1981).

Customer List – Example 2 : Former employees took the client list of a temporary employment service. The former employees argued that the list could not be a trade secret since the information could be obtained through other means. A court disagreed and prevented the ex-employees from using the list because it could not be shown, using public information, which companies were likely to use temporary employees and because the list also included such information as the volume of the customer’s business, specific customer requirements, key managerial customer contacts and billing rates. Courtesy Temporary Serv. Inc. v. Camacho, 222 Cal. App. 3d 1278 (1990) .

Wholesalers’ lists of retail concerns are often hard to protect as trade secrets. Retailers are usually easy to identify through trade directories and other sources, and a list of them ordinarily does not confer a competitive advantage. But there are exceptions—for instance, a list of bookstores that order certain types of technical books and pay their bills promptly may be very valuable to a wholesale book distributor. But if the information is readily ascertainable through trade publications or other industry sources, it is not classified as a trade secret.

In a California case, a court determined that employees who left a business could use their former employer’s mailing list to send out an announcement of their change of employment to former clients. The former employer’s mailing list was not a trade secret because: (1) the clients became known to the ex-employees through personal contacts; and (2) the use of the customer list simply saved the ex-employees the minor inconvenience of looking up the client addresses and phone numbers. In other words, the information was easy to ascertain. Moss, Adams & Co. v. Shilling, 179 Cal. App. 3d 124 (1984) .

• Collections of Data

A database—information of any type organized in a manner to facilitate its retrieval—is often protected as a trade secret. For example, a court ruled that a database for inventorying and cost economies on wholesale sandwich production for fast-food retailers was a protectable trade secret. One Stop Deli, Inc. v. Franco’s, Inc., 1994-1 CCH Trade Cas. P 70,507 (W.D. Va. 1993). A collection of data that is readily ascertainable, however, is not a trade secret.

Databases may also be protected under copyright law if the method of compiling or arranging the data is sufficiently creative.

Know-how does not always refer to secret information. Sometimes it means a particular kind of technical knowledge that may not be confidential but that is needed to accomplish a task. For example, an employee’s know-how may be necessary to train other employees in how to make or use an invention. Although know-how is a combination of secret and nonsecret information, we suggest that you treat it as a protectable trade secret. If you disclose know-how to employees or contractors, use a nondisclosure agreement.

Cease and Desist – A letter from the owner of a trade secret (or copyright, patent or trademark) that requests that alleged illegal activity is stopped immediately.

Clean Room – A method of developing proprietary material in which an isolated development team is monitored. The purpose is to provide evidence that similarities to others’ works or products are due to legitimate constraints and not copying.

Common Law – A system of legal rules derived from the precedents and principles established by court decisions.

Copyright – The legal right to exclude others, for a limited time, from copying, selling, performing, displaying or making derivative versions of a work of authorship such as a writing, music or artwork.

Database – Information of any type organized in a manner to facilitate its retrieval.

Declaratory Relief – An order from a court sorting out the rights and legal obligations of the parties in the midst of an actual controversy.

Diversity Jurisdiction – Federal courts’ right to hear lawsuits based upon non-federal claims; parties must be from different states and the amount in controversy over $50,000.

Economic Espionage Act – A law making it a federal crime to steal a trade secret or to receive or possess trade secret information knowing that it is stolen.

Evaluation Agreement – A contract in which one party promises to submit an idea and the other party promises to evaluate it. After the evaluation, the evaluator will either enter into an agreement to exploit the idea or promise not to use or disclose the idea.

Fiduciary Relationship – When one person stands in a special relationship of trust, confidence or responsibility to another.

Generally Known – Information is generally known if it has been published or publicly displayed or is commonly used within an industry.

Improper Means – The illegal acquisition of trade secrets through theft, bribery, misrepresentation, breach or inducement of a breach of a duty to maintain secrecy or espionage through electronic or other means.

Inevitable Disclosure Doctrine – Under this court-made rule, adopted by only a few courts, a court can stop an ex-employee from working for a competitor if the former employer shows that the employee will “inevitably disclose” trade secrets of the former employer.

Injunction – A court order requiring that a party halt a particular activity. A court can issue an injunction at the end of a trial (a permanent injunction) or immediately, rather than wait for a trial (a preliminary injunction ).

Two factors are used when a court determines whether to grant a preliminary injunction:

(1) Is the plaintiff (the party bringing the lawsuit) likely to succeed in the lawsuit? and

(2) Will the plaintiff suffer irreparable harm if the injunction is not granted?

The plaintiff may seek a temporary restraining order, which lasts only a few days or weeks. A temporary restraining order may be granted without notice to the infringer if it appears that immediate damage will result-for example, that evidence will be destroyed.

Jurisdiction – The authority of a court to hear a certain type of case.

Know-How – A particular kind of technical knowledge that may not be confidential but that is needed to accomplish a task.

License – A contract giving written permission to use an invention, creative work, trade secret or trademark, in return for payment.

Misappropriation – The theft or illegal disclosure of trade secrets.

Non-Competition Agreement – A contract in which a person or company agrees not to compete with the business of another company for a period of time.

Non-Solicitation Provision (also known as a “diversion provision) An agreement that restricts an ex-employee’s ability to solicit clients or employees of the ex-employer.

Option Agreement – An agreement in which one party pays the other for the opportunity to later exploit an innovation, idea or product.

Patent – A grant from a government that confers upon an inventor the right to exclude others from making, using, selling, importing, or offering an invention for sale for a fixed period of time.

Readily Ascertainable – Information readily ascertainable if it can be obtained legally within an industry, at a library or through publicly available reference sources.

Reverse Engineering – Disassembly and examination of products that are available to the public.

Trademark – Any word, symbol, design, device, slogan or combination that identifies and distinguishes goods.

Trade Secret – Any formula, pattern, device or compilation of information that is used in business, that is not generally known, and that gives the owner of the secret an opportunity to obtain an advantage over competitors who do not know or use it.

Uniform Trade Secrets Act (UTSA) – An act created by lawyers, judges, and scholars, and adopted by 43 states and the District of Columbia, in order to confirm the trade secret rules of different states

• ( View Federal Act – View Trade Secret Laws by State )

Work Made for Hire – (1) A copyrightable work prepared by an employee within the scope of employment; or (2) A copyrightable work specially ordered or

commissioned for use as a contribution to a collective work, as a part of a motion picture or other audiovisual work, as a translation, as a supplementary work, as a compilation, as an instructional text, as a test, as answer material for a test, or as an atlas, if the parties expressly agree in a written instrument signed by them that the work shall be considered a work made for hire.

Download the Basic Non-Disclosure Agreement in Adobe PDF or Microsoft Word (.docx) .

Introduction Paragraph

In the Sample NDA Agreement , the “Disclosing Party” is the person disclosing secrets, and the “Receiving Party” is the person or company who receives the confidential information and is obligated to keep it secret. The terms are capitalized to indicate they are defined in the agreement. The sample agreement is a “one-way” (or in legalese, “unilateral”) agreement-that is, only one party is disclosing secrets.

Mutual Agreements Clause [OPTIONAL]

If both sides are disclosing secrets to each other you should modify the agreement to make it a mutual (or “bilateral”) nondisclosure agreement. To do that, substitute the following paragraph for the first paragraph of the agreement.

This Nondisclosure agreement (the “Agreement”) is entered into by and between ____ [insert your name, business form and address] and ____ [insert name, business form and address of other person or company with whom you are exchanging information] collectively referred to as the “parties” for the purpose of preventing the unauthorized disclosure of Confidential Information as defined below. The parties agree to enter into a confidential relationship with respect to the disclosure by one or each (the “Disclosing Party”) to the other (the “Receiving Party”) of certain proprietary and confidential information (the “Confidential Information”).

1. Definition of Confidential Information

Every nondisclosure agreement defines its trade secrets, often referred to as “confidential information.” This definition establishes the subject matter of the disclosure. There are three common approaches to defining confidential information: (1) using a system to mark all confidential information; (2) listing trade secret categories; or (3) specifically identifying the confidential information.

What’s best for your company? That depends on your secrets and how you disclose them. If your company is built around one or two secrets-for example, a famous recipe or formula-you can specifically identify the materials. You can also use that approach if you are disclosing one or two secrets to a contractor. If your company focuses on several categories of secret information, for example, computer code, sales information and marketing plans, a list approach will work with employees and contractors. If your company has a wide variety of secrets and is constantly developing new ones, you should specifically identify secrets.

If confidential information is fairly specific, for example, a unique method of preparing income tax statements-define it specifically.

Example – Specific Confidential Clause

Another approach to identifying trade secrets is to state that the disclosing party will certify what is and what is not confidential. For example, physical disclosures such as written materials or software will be clearly marked “Confidential.” In the case of oral disclosures, the disclosing party provides written confirmation that a trade secret was disclosed. Here is an appropriate provision that was taken from the sample NDA in the previous section.

Example Broad Confidential Clause

When confirming an oral disclosure, avoid disclosing the content of the trade secret. An email or letter is acceptable, but the parties should keep copies of all such correspondence. A sample letter is shown below.

Letter Confirming Oral Disclosure

Today at lunch, I disclosed information to you about my kaleidoscopic projection system, specifically, the manner in which I have configured and wired the bulbs to the device. That information is confidential (as described in our nondisclosure agreement) and this letter is intended to confirm the disclosure.

2. Exclusions from Confidential Information

You cannot prohibit the receiving party from disclosing information that is publicly known, legitimately acquired from another source or developed by the receiving party before meeting you. Similarly, it is not unlawful if the receiving party discloses your secret with your permission. These legal exceptions exist with or without an agreement, but they are commonly included in a contract to make it clear to everyone that such information is not considered a trade secret.

In some cases, a business presented with your nondisclosure agreement may request the right to exclude information that is independently developed after the disclosure. In other words, the business might want to change subsection (b) to read, “(b) discovered or independently created by Receiving Party prior to or after disclosure by Disclosing Party.”

By making this change, the other company can create new products after exposure to your secret, provided that your secret is not used to develop them. You may wonder how it is possible for a company once exposed to your secret to developing a new product without using that trade secret. One possibility is that one division of a large company could invent something without any contact with the division that has been exposed to your secret. Some companies even establish clean room methods.

Although it is possible for a company to independently develop products or information without using your disclosed secret, we recommend avoiding this modification if possible.

3. Obligations of Receiving Party

The heart of a nondisclosure agreement is a statement establishing a confidential relationship between the parties. The statement sets out the duty of the Receiving Party to maintain the information in confidence and to limit its use. Often, this duty is established by one sentence: “The Receiving Party shall hold and maintain the Confidential Information of the other party in strictest confidence for the sole and exclusive benefit of the Disclosing Party.” In other cases, the provision may be more detailed and may include obligations to return information. A detailed provision is provided below.

The simpler provision is usually suitable when entering into an NDA with an individual such as an independent contractor. Use the more detailed one if your secrets may be used by more than one individual within a business. The detailed provision provides that the receiving party has to restrict access to persons within the company who are also bound by this agreement.

In some cases, you may want to impose additional requirements. For example, the Beta Tester Nondisclosure Agreement contains a prohibition against reverse engineering, decompiling or disassembling the software. This prohibits the receiving party (the user of licensed software) from learning more about the trade secrets.

You may also insist on the return of all trade secret materials that you furnished under the agreement. In that case, add the following language to the receiving party’s obligations.

4. Duration of Agreement

How long does the duty of confidentiality last? The sample agreement offers three alternative approaches: an indefinite period that terminates when the information is no longer a trade secret; a fixed period of time; or a combination of the two.

Example – Unlimited (Perpetual) Time Period Clause

Example – Fixed Time-Period Clause

Example – Fixed Time Period With Exceptions Clause

This Agreement and Receiving Party’s duty to hold Disclosing Party’s Confidential Information in confidence shall remain in effect until __________ or until one of the following occurs:

• (a) the Disclosing Party sends the Receiving Party written notice releasing it from this Agreement, or
• (b) the information disclosed under this Agreement ceases to be a trade secret.

The time period is often an issue of negotiation. You, as the disclosing party, will usually want an open period with no limits; receiving parties want a short period. For employee and contractor agreements, the term is often unlimited or ends only when the trade secret becomes public knowledge. Five years is a common length in nondisclosure agreements that involve business negotiations and product submissions although many companies insist on two or three years.

We recommend that you seek as long a time as possible, preferably unlimited. But realize that some businesses want a fixed period of time and some courts, when interpreting NDAs, require that the time period be reasonable. Determining “reasonableness” is subjective and depends on the confidential material and the nature of the industry. For example, some trade secrets within the software or Internet industries may be short-lived. Other trade secrets. For example, the Coca-Cola formula-have been preserved as a secret for over a century. If it is likely, for example, that others will stumble upon the same secret or innovation or that it will be reverse engineered within a few years, then you are unlikely to be damaged by a two- or three-year period. Keep in mind that once the time period is over, the disclosing party is free to reveal your secrets.

5. Relationships

Your relationship with the receiving party is usually defined by the agreement that you are signing. For example, an employment, licensing or investment agreement. To an outsider, it may appear that you have a different relationship, such as a partnership or joint venture. It’s possible that an unscrupulous business will try to capitalize on this appearance and make a third-party deal. That is, the receiving party may claim to be your partner to obtain a benefit from a distributor or sublicensee. To avoid liability for such a situation, most agreements include a provision like this one, disclaiming any relationship other than that defined in the agreement. We recommend that you include such a provision and take care to tailor it to the agreement. For example, if you are using it in an employment agreement, you would delete the reference to employees. If you are using it in a partnership agreement, take out the reference to partners, and so forth.

6. Severability

The severability clause provides that if you wind up in a lawsuit over the agreement and a court rules that one part of the agreement is invalid, that part can be cut out and the rest of the agreement will remain valid. If you don’t include a severability clause and some portion of your agreement is deemed invalid, then the whole agreement may be canceled.

7. Integration

In the process of negotiation and contract drafting, you and the other party may make any oral or written statements. Some of these statements make it into the final agreement. Others don’t. The integration provision verifies that the version you are signing is the final version and that neither of you can rely on statements made in the past. This is it! Without an integration provision, it’s possible that either party could claim rights based upon promises made before the deal was signed.

A second function of the integration provision is to establish that if any party makes promises after the agreement is signed, those promises will be binding only if they are made in a signed amendment (addendum) to the agreement.

The integration clause closes the door on any oral or written promises. Don’t sign an agreement if something is missing and don’t accept an assurance that the other party will correct it later.

This provision states that even if you don’t promptly complain about a violation of the NDA, you still have the right to complain about it later. Without this kind of clause, if you know the other party has breached the agreement but you let it pass, you give up (waive) your right to sue for it.

For example , imagine that the receiving party is supposed to use the secret information in two products but not in a third. You’re aware that the receiving party is violating the agreement, but you are willing to permit it because you are being paid more money and don’t have a competing product. After several years, however, you no longer want to permit the use of the secret in the third product. A waiver provision makes it possible for you to sue. The receiving party cannot defend itself by claiming it relied on your past practice of accepting its breaches. Of course, the provision swings both ways. If you breach the agreement, you cannot rely on the other party’s past acceptance of your behavior.

9. Notice of Immunity [OPTIONAL]

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Business Plan Confidentiality Agreement

A business plan confidentiality agreement (or NDA) is used when sharing a business idea or plan with consultants, investors, or anyone else that is evaluating your business. It establishes what information cannot be shared and prevents any misunderstandings. This confidentiality agreement is used as a legally binding document with the parties that are meeting each other. It will help establish definitions about trade secrets and when information can be shared.

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The Importance of a Business Plan NDA

Risks of not using it, what to include in a business plan non-disclosure agreement.

Even when a business is new, there can still be plans or ideas that can be stolen. Having an NDA agreement for a business plan prevents your unique ideas from being misused by another party.

As with any confidentiality agreement, a business plan NDA will keep your information safe. You will know that your business idea will not be used by someone else. Your plan may have potential trade secrets and other company secrets that you do not want public. A statement of confidentiality will prevent that from happening.

Using a business plan disclosure agreement can prepare you for using NDAs for your business career, both with third parties and employees. Many businesses have trade secrets and confidential information that you want to control the release of. Using the nda template from the beginning will help your business establish good practices.

A business plan covers many different ideas and aspects of running a business. Marketing, competition, and finances are all included. This is valuable information that you want to protect, in many cases for the entire time you are running your business.

Business plans cover a lot of important information that you will want to protect, oftentimes for the entire time it’s operating. Keeping these plans safe will help your business have a successful start and continue to grow.

Aspects of your business plans that you will want to be protected by a business plan confidentiality agreement include market analysis and strategy, list of competitors, staffing and employee plans, and financial data.

This research and planning cover not only your business idea but what you have discovered about other businesses in a similar market. These plans can be protected with a non-disclosure agreement for a business plan to help you keep the right information safe.

When you don’t use a business plan confidentiality agreement you have the risk of your business idea being used or sold without your permission. It would be a shame if all of the time and energy that you spent on developing just the right ideas were used by someone else. Business plans being stolen is a real threat and you want to protect yourself from it.

If the worst-case scenario occurs and the business idea is stolen from you, a business plan confidentiality agreement will also give you recourse options, including compensation. It will save you time and money to establish what information was publicly known and what was revealed during the business plan meeting.

With a confidentiality agreement, all parties have agreed to what information was not allowed to be shared, making getting legal help easier. There will be less confusion with NDAs signed before any confidential information is shared.

A business plan non-disclosure agreement should include many similar aspects of other statements of confidentiality. These agreements define the terms of what is confidential and what can happen if there is a breach of contract.

1. Define Confidential Information

The first item to include in a non-disclosure agreement for a business plan is to define confidential information and how it applies in this document. It can include revenue predictions, spending plans, and predicted future trends among many other aspects of running a business. Without these terms being defined.

2. The Agreement of Confidentiality

The next item to include is the agreement of confidentiality on the receiving parties. This includes talking about what is the meeting, making copies of any documents, or making commercials from the topics discussed. This will also cover how the receiving party will handle being asked about confidential information.

In cases where documents and materials are being shared, a confidentiality agreement will also disclose that these materials be returned within a time frame. The receiving party cannot make copies or share this information without the consent of the business owner.

3. Exclusions

Exclusions are included in a business plan confidentiality agreement to cover what the receiving party already knew before the agreement, if information becomes public knowledge, or is available through other sources legally.

4. Duration

A non-disclosure agreement for a business plan also covers how long the agreement is in effect. This can be until a specified date or certain provisions are met, such as being released from the confidentiality agreement or the information stops being a trade secret.

5. Courts and Contracts

A statement of confidentiality will also include general provisions about if the agreement is determined to be void by a court and an agreement that the current contract supersedes previous contracts and agreements.

6. Legal Ramifications

Legal ramifications for a breach of the confidentiality agreement are also included. This can include legal action and pay for legal fees. These fees will be paid to the disclosing party or business owner, from the receiving party to cover damages and loss of business from the broken contract.

Once the business plan confidentiality agreement is signed and dated, the contract is placed into effect unless otherwise made void.

When drafting a confidentiality agreement for a business idea, you want to use the right language and organize it correctly. They can cover a lot of information and you want to ensure that all the right information is accounted for to protect your business plans.

WTO / Legal / Non-Disclosure / Free Non-Disclosure Agreement (NDA) Templates (How to Write)

Free Non-Disclosure Agreement (NDA) Templates (How to Write)

A Non-Disclosure Agreement (NDA), popularly referred to as a “Confidentiality Agreement,” is a legal agreement that binds the Recipient of confidential Information from disclosing it to unauthorized parties. The Party or Parties upon signing the Agreement acknowledge that they shall not disclose any Confidential or Proprietary Information they obtain from the Disclosing Party.

Free Templates by Types

Categories of NDAs

Generally, there are three main categories of NDAs:

• Unilateral NDA : Two parties are involved in this type of NDA. Only one party discloses Confidential Information, and the other party is bound to ensure that the information is not disclosed further without consent from the Disclosing Party.
• Bilateral NDA : Two parties are involved in this type of NDA. Whereby both parties disclose Confidential Information, they are both tasked with ensuring that the information disclosed remains confidential.
• Multilateral NDA : Generally, three or more parties are involved in this type of NDA. Of which only one party discloses Confidential Information, and the rest is to ensure that the confidentiality of the information is maintained.

Benefits of NDAs

Signing a NDA has many benefits. 

Here are some of the significant benefits of an NDA:

• Since a NDA is a legal document, it is of utmost importance for any conflict that might arise in the future. Any party that breaches the Agreement is held accountable and is legally liable to compensate for any damages caused.
• It clearly defines what is to be considered as “Confidential” thereby avoiding any ambiguity or loss of information
• It ensures that any information shared between engaging parties remains confidential and reduces the chances of any critical information being disclosed to the public.

An NDA can also help in safeguarding business assets, including but not limited to:

• Business Strategies and methods
• Designs, Blueprints, and Specifications
• Physical devices and Articles
• Computer Software
• Customer Lists
• Collection of data

Precautions while creating and signing a NDA

Before signing an NDA, here are a few things you need to take care of:

• Go through the document and ensure that all the information mentioned is precise and that you fully understand the Agreement.
• Make sure that the parties involved in the Agreement read the entire NDA and verbally explain it to avoid any misunderstandings.
• Avoid including non-required clauses or conflicting sentences when drafting an NDA.

General Contents of a NDA

All NDAs must have the following:

• The parties involved
• The disclosure Period
• Definition of what is confidential
• The term of the Agreement
• Any exclusions from what is to be kept confidential
• Any obligations to keep the information confidential
• Any types of acceptable disclosure, such as law enforcement
• Ending the Agreement
• Remedies in case of breach of confidentiality

Non-Disclosure Agreement Glossary

Here are some of the words you are likely to come across when drafting or signing an NDA:

• Cease and Desist: a letter from the owner of the Confidential/Proprietary Information requesting the alleged illegal activity to be stopped with immediate effect.
• Clean Room: this is a method of developing proprietary material with an isolated development team monitoring the content produced, to ensure that they can provide evidence that any similarities to other works or products are solely due to legitimate constraints and not copying.
• Common-Law: This is a system of legal rules derived from previous principles established by court decisions.
• Copyright: is a type of intellectual property that limits other parties from copying, selling or making derivative versions of creative work, usually for a limited time
• Database: a structured set of information organized in a manner to facilitate its retrieval.
• Declaratory Relief: it refers to decisions by the court, which determines the rights of the parties in the Agreement without ordering anything be done or awarding damages.
• Economic Espionage Act: this act makes it a federal crime for any person to steal, receive, possess, or trade secrets knowing that it has been stolen.
• Evaluation Agreement: this is an agreement in which one party agrees to share their idea, and the other party consents to evaluate it and, after that, not disclose or use the idea.
• Fiduciary Relationship: Also known as a confidential relationship. A fiduciary relationship is a relationship in which one party places special trust, reliance, and confidence in and is influenced by another party who must act on behalf of the party.
• Generally known: Information is usually known if it is available in the public domain or is commonly used within an industry.
• Improper Means: Acquiring trade secrets through theft, breach, bribery, or enticement to breach secrecy or espionage through electronic or other means.
• Injunction: a court order is necessitating that a party stops a particular activity or compelling them to carry out a specific act.
• Jurisdiction: the rule of a court to hear certain types of cases.
• License: official permission to do, use, or own something.
• Misappropriation: Breach of trade secrets.
• Non-Competition Agreement: this is a legal agreement between an employer and an employee whereby the employee approves not to enter into competition with the employer during or after the employment period.
• Non-Solicitation Provision: this is a contract restricting an individual/former employee from soliciting clients after the employee departs from the business.
• Patent: a grant from a government, protecting an invention from employees, contractors, or third parties from sharing or copying the concept/design.
• Trademark: a symbol, word, words, design, device, slogan, or combination legally registered or established by use as representing a company or product.
• Trade Secret: any information that is of economic value to the business that is not available in the public domain.
• Uniform Trade Secrets Act (UT SA): This is a model act, drafted by the National Conference on Uniform State Laws and has been adopted as the basis of trade secrets in over 40 states.

How to Write a NDA

Introduction paragraph.

In the introduction paragraph, include the names of both the “Disclosing Party” and the Recipient of the “Confidential Information,” the “Receiving Party.” The terms are capitalized to show that they are defined in the Agreement.

This Non-Disclosure Agreement (NDA) is entered into by and between ____________ (The “Disclosing Party)_______________ (The “Receiving Party”) conjointly referred to as the “parties” in this Agreement to prevent the unauthorized disclosure of information as defined below.

Definition of confidential information

In this paragraph, define what is to be considered confidential or proprietary information without actually disclosing the actual information. For instance, “A software that helps you analyze financial data.” You must also ensure that any information not designated as confidential is clearly defined.

  For this Agreement, “Confidential or Proprietary Information” shall refer to any information that the Disclosing Party shall provide to the Receiving Party, be it technical or non-technical. The information, whether in writing or any other form, shall be considered confidential in this Agreement. If the information provided is in written form, then the Disclosing Party shall label or stamp the material with the word “CONFIDENTIAL” or any other similar warning. If the information is conveyed orally, the Disclosing Party shall indicate in writing that such oral communications constituted Confidential Information.

Exclusions from confidential information

This paragraph describes all the information not covered in the Agreement.

The Receiving Party shall not be held accountable for disclosing any information that is already known to the public. 

Obligations of receiving party

This clause states what is required of the Receiving Party upon signing the “Agreement.”

“The Receiving Party shall at all times uphold and maintain the Confidential Information of the other Party in utmost confidence for the ultimate and exclusive benefit of the “Disclosing Party.”

Duration of agreement

This clause defines the period to which the Agreement should last. It can either be infinite or definite, depending on the type of information covered in the Agreement.

Example of Infinite Period Clause

The Receiving Party shall be bound to keeping the “Confidential Information” as such until such a time when the Confidential Information no longer qualifies as a trade secret or until the Disclosing Party sends, in writing, a notice to the Receiving Party relieving them of their duties and responsibilities from this Agreement.

Example of Fixed Period Clause

The Receiving Party shall uphold the Confidentiality of the Information provided by the Disclosing Party, and this Agreement shall remain in effect until ______________

Relationships

This clause is meant to dissociate from any other relationships that are not the intent of the Agreement.

This Agreement shall not be considered to institute either party a partner, Joint venture , or employee of the other party for any purpose of any kind.

Severability

This clause provides that, in the event of a legal battle over the Agreement and it is ruled by the court that a section of the Agreement is void, that part can be ruled out. The rest of the Agreement remains valid.

Integration

This clause acknowledges that the version Agreement you are signing is the final version and that all other statements made in the past are void.

This clause provides that any terms and conditions of this Agreement shall only be waived or amended upon written consent from the Disclosing Party.

Types of NDA’s

There are various types of NDAs, including:

• Business Associate (HIPAA) Agreement : Provides sample language and provisions necessary for compliance with the HIPAA rules and regulations and the HITECH Act, which covers the Relationship between a HIPAA-covered entity and a business associate.
• Business Plan Non-Disclosure Agreement: This Agreement is used when sharing a business plan with investors, consultants, contractors, potential employees, and anyone else assessing your planned enterprise.
• Business Sale Non-Disclosure Agreement: allows a seller to privately disclose all confidential information regarding sales, customers, and financial details to a potential buyer.
• Commercial Real Estate Non-Disclosure Agreement: is meant for use when the owner of a commercial real estate wants to disclose Confidential Information about a property to prospective buyers, consultants, tenants, business partners, or investors.
• Customer List Non-Disclosure Agreement: is intended for use by companies that want to sell or license their customer lists to other businesses.
• Employee Non-Disclosure Agreement : limit employees from sharing any confidential or proprietary information without permission
• Film (Movie) Non-Disclosure Agreement : meant for use when sharing original film concept, storyline or screenplay
• Financial Information Non-Disclosure Agreement: often used when disclosing financial information in contemplation of a business acquisition, an audit, or an account analysis.
• HIPAA (Employee) Non-Disclosure Agreement: used to ensure that an employee of healthcare facilities to agree not to disclose any medical information without permission.
• Independent Contactor Non-Disclosure Agreement : intended for use with workers/contractors who perform tasks for you or your business.
• Intern Non-Disclosure Agreement: meant to protect interns from disclosing any Confidential Information during Internships.
• Landlord-Tenant Confidentiality Agreement: is meant for use when the landlord is disclosing any Confidential Information about a property to a potential tenant.
• Mutual Non-Disclosure Agreement : is meant to create a Confidential Relationship between two parties engaging in exchange of Confidential Information.
• Patent/Inventory Non-Disclosure Agreement: intended for use when protecting an invention from employees, contractors, or third parties from sharing or copying the concept/design.
• Product Development Non-Disclosure Agreement : This Agreement is used to protect the Releaser’s Intellectual Property before patenting.
• Real Estate Buyer Confidentiality Agreement:   This Agreement is for use when a seller of a property is looking to disclose Confidential Information to the potential buyer and wouldn’t want such information to be made public.
• Software Development Non-Disclosure Agreement : This Agreement intended for use when sharing information with another Party to create patentable software.
• Trade Secret Non-Disclosure Agreement: is intended for use when disclosing any proprietary information that is to be kept confidential.
• Unilateral Non-Disclosure Agreement : a standard form in which only one party shall be responsible for maintaining the confidentiality of the information provided.
• Violation of Non-Disclosure Agreement : also referred to as a Cease and Desist Order. This Agreement is meant to warn the Receiving Party of Confidential Information that if they do not stop violating the information, legal actions shall be taken against them.
• Volunteer Non-Disclosing Agreement: This Agreement is intended for use when any guests are agreeing to provide their time and labor for free with the condition of upholding any information shown to them with utmost confidence.
• Website Design Non-Disclosure Agreement: This Agreement is intended for use when protecting confidential and proprietary information against any third-party competitors during the development of a website.

Templates by State

Frequently asked questions.

The other party is not lawfully obliged to keep any information provided to them before entering an Agreement a secret. However, you may decide to ask them not to disclose the information you have disclosed to them.

No. You may not amend an NDA. Once both parties to an agreement have acknowledged the Agreement, then your only option is to renegotiate with them before making any changes. You may request the other parties to maintain or renew the Agreement if an NDA expires.

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Free Unilateral (1-way) NDA Template

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In the intricate landscape of business transactions and collaborations, safeguarding sensitive information is paramount. One powerful tool that plays a crucial role in this arena is the Unilateral or 1-Way Non-Disclosure Agreement ( NDA ). This comprehensive guide explores the nuances of unilateral NDAs, shedding light on their significance, key components, and practical considerations for businesses and individuals navigating the intricate web of confidentiality.

Understanding Unilateral Non-Disclosure Agreements:

A Unilateral or 1-Way Non-Disclosure Agreement is a legal document that establishes confidentiality between two parties, but with a distinct directional flow of information. In this arrangement, one party (the disclosing party) shares confidential information with another party (the receiving party), and the receiving party is obligated to keep that information confidential. This one-sided nature provides a level of protection to the disclosing party, making unilateral NDAs a valuable tool in various business scenarios.

Significance of the Unilateral NDA for Businesses

The Unilateral or 1-Way Non-Disclosure Agreement (NDA) holds immense usefulness for businesses across various industries, serving as a critical tool to safeguard sensitive information and foster secure collaborations. Here are key ways in which businesses benefit from the implementation of unilateral NDAs:

1. Protection of Intellectual Property:

Businesses often deal with proprietary information, trade secrets, and intellectual property that form the core of their competitive advantage. A unilateral NDA ensures that these critical assets are protected when shared with external parties such as contractors, collaborators, or potential partners.

2. Confidential Business Negotiations:

During negotiations for mergers, acquisitions, partnerships, or joint ventures, businesses need to share sensitive financial and strategic information. The unilateral NDA acts as a shield, allowing companies to engage in open and productive discussions without the fear of information leakage.

3. Collaborations and Research Partnerships:

In industries where research and development collaborations are common, businesses rely on unilateral NDAs to share research findings, technological innovations, and other confidential data with research partners. This encourages collaboration while maintaining control over proprietary information.

4. Securing Third-Party Services:

When engaging third-party service providers such as consultants, contractors, or vendors, businesses often share sensitive information to facilitate the provision of services. A unilateral NDA ensures that these service providers are legally bound to maintain confidentiality, minimizing the risk of unauthorized disclosure.

5. Product Development and Design:

Businesses involved in product development or design processes frequently exchange confidential information with designers, manufacturers, or suppliers. A unilateral NDA provides a formalized framework to protect product concepts, designs, and specifications.

6. Employee and Contractor Relationships:

Internally, businesses use unilateral NDAs with employees and contractors who may have access to proprietary information. This safeguards the company’s interests by ensuring that employees and contractors do not disclose confidential information during or after their employment or engagement.

7. Maintaining Competitive Edge:

In competitive industries, maintaining a competitive edge is crucial. Unilateral NDAs help businesses keep their strategies, marketing plans, and other confidential information away from the prying eyes of competitors, thereby preserving their market position.

8. Compliance with Legal Standards:

Many industries are subject to regulatory requirements and legal standards related to the protection of sensitive information. Implementing unilateral NDAs demonstrates a commitment to compliance and can serve as evidence of due diligence in protecting confidential data.

9. Licensing and Technology Transfer:

In cases where businesses engage in licensing agreements or technology transfers, a unilateral NDA ensures that the licensed technology or intellectual property is not disclosed to unauthorized parties. This is particularly critical in industries with rapidly advancing technologies.

10. Investor Relations:

When seeking funding or engaging with potential investors, businesses share financial projections, business plans , and other sensitive data. The unilateral NDA safeguards these disclosures, providing a level of assurance to investors while maintaining confidentiality.

11. Preventing Unfair Competition:

The unilateral NDA helps prevent unfair competition by restricting the receiving party from using the disclosed information for purposes other than those explicitly agreed upon. This protects businesses from the risk of their own confidential information being used against them.

12. Facilitating Due Diligence Processes:

During due diligence processes, whether for internal audits or external assessments, businesses share a significant amount of confidential information. A unilateral NDA ensures that this information remains confidential throughout the due diligence period.

In summary, the Unilateral or 1-Way Non-Disclosure Agreement is an invaluable asset for businesses, offering a robust mechanism to protect sensitive information in various business scenarios. Whether engaged in negotiations, collaborations, or day-to-day operations, businesses can leverage unilateral NDAs to build trust, maintain confidentiality, and navigate the complexities of the business landscape with confidence.

Practical Considerations for Businesses and Individuals:

1. Purpose and Scope:

Clearly define the purpose and scope of the confidential information being disclosed. Understanding the boundaries of the agreement is essential for both parties.

2. Mutual Understanding:

Ensure that both parties have a clear and mutual understanding of the terms outlined in the unilateral NDA. Open communication is key to avoiding misunderstandings.

3. Tailoring the Agreement:

Tailor the agreement to the specific needs of the situation. Unilateral NDAs can vary widely based on the type of information being disclosed and the context of the business relationship.

4. Consultation with Legal Professionals:

Given the legal implications, it is advisable for businesses and individuals to consult with legal professionals when drafting or entering into a unilateral NDA. Legal guidance ensures that the document is comprehensive and legally enforceable.

5. Periodic Review:

Periodically review and update the unilateral NDA to ensure its continued relevance and effectiveness. As business relationships evolve, so too should the agreements that govern them.

6. Clear Communication Channels:

Establish clear channels of communication between the disclosing party and the receiving party. This ensures that any concerns or questions about the confidential information can be addressed promptly.

7. Recordkeeping:

Maintain thorough records of the confidential information disclosed, the terms of the agreement, and any communications related to the unilateral NDA. This documentation can be invaluable in the event of a dispute.

8. Training and Awareness:

Provide training to employees or individuals involved in handling confidential information. Ensure that they are aware of their obligations under the unilateral NDA and the importance of maintaining confidentiality.

Key Components of Unilateral Non-Disclosure Agreements:

1. Identification of Parties:

Begin the agreement by clearly identifying the disclosing party and the receiving party. Include their full legal names, addresses, and any other relevant details to ensure accurate representation.

Disclosing Party: [Full Name]

Receiving Party: [Full Name]

2. Definition of Confidential Information:

Clearly define what constitutes confidential information. This section should encompass the scope of the information that the disclosing party intends to keep confidential, ensuring clarity for both parties.

Confidential Information:

– [Detailed description of the information considered confidential]

3. Obligations of the Receiving Party:

Specify the obligations of the receiving party concerning the confidential information. This includes a commitment to maintain confidentiality, restrictions on use, and the prevention of unauthorized disclosure.

Obligations of the Receiving Party:

Maintain the confidentiality of disclosed information

Use the information solely for the agreed-upon purpose

Prohibit unauthorized disclosure to third parties

4. Exceptions to Confidentiality:

Clearly outline any exceptions to the confidentiality obligations. This section may include information that is already in the public domain, information independently developed by the receiving party, or information disclosed with the express written consent of the disclosing party.

Exceptions to Confidentiality:

Information already in the public domain

Information independently developed by the receiving party

Information disclosed with written consent from the disclosing party

5. Duration of Confidentiality:

Specify the duration for which the confidentiality obligations will apply. This timeframe can vary based on the nature of the information and the requirements of the disclosing party.

Duration of Confidentiality:

[Specify the duration, e.g., 2 years from the date of disclosure]

6. Legal Recourse for Breach:

Clearly articulate the legal consequences in the event of a breach of the confidentiality obligations. This may include injunctive relief, monetary damages, or other remedies available under the law.

Legal Recourse for Breach:

Injunctive relief

Monetary damages

Any other remedies available under applicable laws

7. Governing Law and Jurisdiction:

Specify the governing law that will apply to the agreement and the jurisdiction in which any legal disputes will be resolved. This adds a layer of legal certainty and clarity to the document.

Governing Law and Jurisdiction:

Applicable laws of [Jurisdiction]

Any legal disputes to be resolved in the courts of [Jurisdiction]

8. Effective Date and Termination:

Clearly state the effective date of the agreement and outline the circumstances under which the agreement can be terminated. This may include mutual agreement, completion of the purpose for which the information was disclosed, or other predefined conditions.

Effective Date and Termination:

Effective date: [Date]

Termination conditions: [Mutual agreement, completion of purpose, etc.]

In the ever-evolving landscape of business, Unilateral or 1-Way Non-Disclosure Agreements stand as guardians of confidential information. Whether businesses engaging in collaborations, individuals exploring partnerships, or entities entering into negotiations, these agreements provide a structured and legal framework for protecting sensitive data. By understanding the key components and practical considerations outlined in this guide, businesses and individuals can navigate the complexities of unilateral NDAs with confidence, ensuring the security of their confidential information and fostering trustworthy collaborations in the world of business.

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How to write an NDA to secure your business: A step-by-step tutorial

Yauhen Zaremba Director of Demand Generation at PandaDoc

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Non-disclosure agreements (NDAs) have become common in the workplace today.

In fact, according to a study most recently updated in 2017, just over one-third of U.S. workers were required to sign an NDA of some kind, and that number’s unlikely to have fallen much since.

These contracts, which are also known as confidentiality agreements, are written agreements that prohibit parties from sharing information that’s confidential.

If you’ve got questions about how to make a non-disclosure agreement, we’ll address them below and offer insider tips, such as how to write a legally binding contract , along the way so that your NDA will be robust and protective.

What does a non-disclosure agreement do?

Non-disclosure agreements, AKA confidentiality agreements , are legally binding contracts that establish confidentiality between parties.

The party (or parties) who sign the NDA agree that any sensitive information they might be privy to won’t be shared with anyone outside of the agreement.

NDAs are a fairly common practice for businesses entering into negotiations with one another.

They have the benefit of allowing parties to share sensitive information and plans without worrying that the information will end up being seen, stolen by, or sold to competitors.

A mutual non-disclosure agreement is where two or more parties share information both ways and agree not to leak that information to outside parties.

If a non-disclosure agreement is breached by either party, the party whose information has been leaked can seek legal action to avoid and prevent any more disclosures and may choose to sue the offending party for monetary damages due to the leaked information.

However, proving that an NDA has been breached is tricky.

So these contracts are often used more as a deterrent rather than as a way to successfully collect damages — although this is possible.

Types of NDAs

While most general non-disclosure agreements contain the same basic information, you may need a specialized NDA based on the relationship between the parties that are sharing confidential information.

Here are a few types of generic non-disclosure agreements that you may need as a business owner:.

1. Patent/product development NDA

A patent-focused non-disclosure agreement allows a company to retain all confidential information regarding their patents or inventions.

This can be useful for startups or established businesses that don’t want employees, vendors, or other third parties to share information about their patent.

Similarly, product development NDAs protect sensitive information regarding a new product before a patent has been filed for it.

2. Employee NDA

An employee NDA informs an employee that he or she may not divulge sensitive information or trade secrets without first gaining the employer’s permission.

Even if you’re unsure what may qualify as confidential information, having employees sign an NDA before joining the company sets a good privacy standard.

Like employees, independent contractors may also be exposed to proprietary information.

These 1099 employees should sign an NDA before beginning to work for a company, just like regular employees do.

3. Job interview NDA

If your talent acquisition team is conducting interviews for a sensitive job, consider drafting a job interview NDA.

It’s possible that interviewers may divulge sensitive information when they ask prospective employees questions during an interview.

Employees who are hired typically sign NDAs, but what about those who didn’t get the job?

Because unhired interviewees may be exposed to confidential information, draft a simple NDA that each person you’re going to interview must sign before the interview begins.

4. Mutual NDA

These legal documents, which are also known as two-way NDAs , allow two different parties to share their trade secrets.

However, these two entities must still keep the information that has been shared between the two parties private.

5. Customer List NDA

If your company sells its customer lists to third parties, you’ll want to make sure that file doesn’t get into the hands of your competitors.

Draft a customer list non-disclosure agreement and have the third party sign it before you turn over this potentially lucrative information.

6. Business plan NDA

Perhaps you need to start attracting investors to your business.

A business plan non-disclosure agreement will come in handy here, as it will keep the details of your business plan secure after you pitch to investors.

This type of NDA can also be helpful for startups that need to show a third party the details of their business plan to receive funding, for instance.

7. Business sale NDA

On the other hand, maybe you’ve finally grown your business to the point that you want to sell it. Now’s the time to whip out a handy business sale NDA.

This confidentiality agreement is useful for keeping trade secrets and business information private during negotiations, such as mergers, investment discussions, potential joint-venture negotiations, and the final sale of a business.

How to write a non-disclosure agreement: What’s included?

Now that you know about the different types of NDAs, it’s time to find out how to write an NDA of your own.

Most standard NDAs follow this format:

• Introduction
• Definition of confidential information
• How to handle confidential information
• Exclusions from confidential information
• Obligations of receiving party
• Duration of agreement
• Resolving disputes
• Integration
• Choice of law
• Signature page with notarization

Easy enough, right? These sections are pretty self-explanatory, so you surely know what each of them should entail, don’t you?

Just kidding — we’ll break down each of these sections so that by the time you’re finished reading, you’ll know all the ins and outs of an NDA like the back of your hand.

NDA Template

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This NDA Agreement Template can be used between a company and a vendor or subcontractor to establish confidentiality between the two parties.

01. Introduction

First and foremost, you’ll need to add an explicit title to the generic non-disclosure agreement.

It can be something as simple as “Non-Disclosure Agreement” or it could be a more specific title, such as “Product Development Non-Disclosure Agreement.”

You’ll also need to state the disclosing party, receiving party, and the purpose of the contract in the unilateral NDA .

The disclosing party is the party that’s disclosing confidential information.

The receiving party is the party that receives this information and is legally obliged to keep it a secret.

Of course, the purpose of the contract is to prevent the disclosure of sensitive information.

Here’s an example of what your standard NDA introduction should look like:

This Non-Disclosure Agreement (the “Agreement”) is entered into by and between ________________ (the “Disclosing Party”) and ______________ (the “Receiving Party”) for the purpose of preventing the unauthorized disclosure of Confidential Information as defined below. The parties agree to enter into a confidential relationship in regards to the disclosure of certain proprietary and confidential information (“Confidential Information”).

If both sides signing the NDA are disclosing confidential information to each other, the NDA should be adjusted to be a mutual non-disclosure agreement. In this case, the introduction would read as follows:

This Non-Disclosure Agreement (the “Agreement”) is entered into by and between _________________ (Party A) and _______________ (Party B) collectively referred to as “the parties” for the purpose of preventing the unauthorized disclosure of Confidential Information defined below. The parties agree to abide by a confidential relationship in regard to the disclosure by one or each of the parties of certain confidential information.

02. Confidential information

Following the introduction, you’ll need to define what confidential information is protected by the legal contract.

Depending on your business, you may have several classes of information that would be considered as trade secrets or otherwise confidential information.

A trade secret is defined as intellectual property that has economic value precisely because this information isn’t public knowledge.

Trade secrets can include everything from formulas, recipes, and processes to practices, designs, and instruments.

For example, Coca-Cola’s recipe for the Coca-Cola Classic soft drink is a trade secret, as the specific formula has led to the soda’s market dominance both in the United States and across the globe.

If everyone had access to this recipe, Coca-Cola’s profits would be diminished as competitors would rip off their secret formula.

There’s no doubt that anyone who has access to this prized recipe is bound heavily by strict NDAs.

Types of information protected by NDAs include but aren’t limited to:

• Standard Operating Procedures (SOPs)
• Formulations
• Technical information
• Financial information
• Architectural drawings
• Design blueprints
• Specialized tools
• Product specifications
• Test results
• Customer lists
• Vendor lists
• Business methods
• Marketing strategies
• Technical know-how
• Medical information

If you’re making money off something that the public domain has no insider knowledge of, you’d benefit from writing your own NDA.

Your confidential information clause may resemble the description from PandaDoc’s free sample NDA :

“Confidential Information” means information, to the extent it is not a Trade Secret, which is possessed by [Disclosing Party] and which relates to [Disclosing Party], including, without limitation, for example: business plans, strategies, existing or proposed bids, costs, technical developments, financial or business projections, investments, marketing plans, or training information, materials, and examples of confidential information.

03. How to handle confidential information

Now that you’ve included the confidential information in the legal document, you should state how the proprietary information should be handled.

Depending on who’s designated as the receiving party, this may include researching the party’s confidentiality practices.

If you’re binding an employee to an NDA, this may not be necessary.

However, if you’re divulging confidential information to a third party, such as a potential partner or vendor, you’ll want to do your homework on how the organization handles confidentiality.

Next, define the standard of care.

This is essentially how strictly the confidential information should be handled.

Generally, NDAs state “commercially reasonable” or “in strictest confidence” to avoid negligent or willful divulgence of trade secrets.

The degree of standard of care will depend on the confidential information you’ are protecting.

In Coca-Cola’s situation, we can easily assume that anyone who has access to the prized formula is bound under the “in strictest confidence” standard of care.

An employee who must work with a partner or vendor may be held to the “commercially reasonable” standard of care, so they can share aspects of the confidential information that helps accomplish business-related objectives .

04. Non-confidential information

After you’ve explicitly discussed what information is protected and how it should be handled, the NDA must state which information isn’t confidential.

This may seem redundant, but it’s needed for clarity. Sticking with the Coca-Cola case, an example of non-confidential information would be the company’s bottling process.

Coca-Cola doesn’t make money off how it fills its bottles. It’s what’s inside them that counts.

05. Obligations of the receiving party

Next, it’s time to discuss the obligations of the receiving party.

This section describes how the receiving party must maintain the information’s confidentiality and limit its use. You’ll want to specify under which conditions the receiving party is permitted to reveal protected information.

This may be under no circumstances, or under special circumstances where the receiving party may need to work collectively with another party for business purposes.

If your NDA is a mutual agreement or a more complicated agreement, you’ll want a long-form statement that describes the obligation of the receiving party.

This may include requiring the return of all trade secret documents or the prohibition of activities that may leak confidential information to undesired parties.

06. Duration of the agreement

Another important component of a non-disclosure agreement is the time period of the disclosure of information and confidentiality.

First, detail the time period relating to information sharing.

This could be while the NDA is active or during the first few months of the relationship between the receiving and disclosing party.

This section will depend on the purpose of the NDA and the parties’ objectives.

Next, determine the effective date of the NDA and how long the duty of confidentiality lasts.

Generally, you’ll have three options: a fixed period of time, in perpetuity, or an indefinite period of time.

You may choose a fixed period of time by specifying that the agreement will be active until a certain date. If you want rock-solid confidentiality, opt for the in-perpetuity duration.

This forbids the receiving party from divulging protected information under any circumstances in the future.

For an indefinite period of time, you may state that the NDA is active until 1) the disclosing party decides to end the agreement or 2) the confidential information no longer qualifies as a trade secret because it has become part of the public domain.

07. Resolving disputes

You’ve laid the groundwork for most of the nitty-gritty NDA details. Now, it’s time to address disputes.

Although the purpose of an NDA is to avoid breaches of confidentiality, these things may still happen.

In your standard NDA, you’ll want to discuss what the remedy is for a potential breach of contract and any possible legal action that may be taken as a result.

Remedies can include, but aren’t limited to, money for damages, a predetermined fine amount, a court order known as an injunction, loss of employment, and the entitlement to an attorney’s fees that were spent on enforcing the legal contract.

Be careful, though, of specifying an amount of money for damages.

Some courts may refuse to enforce damages that are considered to be too high, and damages that are set too low may not protect your trade secrets securely.

It’s also wise to consider adding an alternative dispute resolution clause.

This section is basically about both parties coming together privately, whether that’s through a casual meeting or official mediation, to resolve any disputes.

Why is an alternative dispute resolution necessary?

For one, court proceedings are public information.

Many businesses would prefer to discuss disputes privately rather than sharing these proceedings with the world.

It’s also advisable to seek an alternative dispute resolution because it can often make things more easy and efficient.

Depending on where you file a court order, getting a hearing scheduled and a final decision could take weeks if not months.

Alternative dispute resolutions allow for a more speedy and flexible time frame compared to litigation.

08. Finalizing the NDA

While all of the aforementioned information is great, the document doesn’t mean anything until your NDA is properly finalized.

Follow these easy steps to ensure that your NDA is considered to be a legally binding contract.

1. Integration clause

In the simplest terms, the integration clause verifies that the signed copy of the NDA is the final version.

This clause ensures that parties can’t rely on past statements once the NDA is signed.

Furthermore, the integration clause may also stipulate that changes to the agreement may only be valid if they’re presented through an addendum.

An addendum is an official signed agreement finalized after the initial NDA was signed.

2. Choice of law

Next, specifying the choice of law in your NDA is critical.

This designates which state law applies to the non-disclosure agreement if a lawsuit should develop.

The easiest way to do this is to list that the agreement shall be governed by the laws of the state you work in.

3. Signature block

Once you’ve got the integration and choice of law formalities out of the way, it’s time to make room for signatures .

Each person who signs the NDA should have their own signature block. Include a line for the signature, the printed name of the party, and the date the NDA was signed.

4. Notarization

Finally, make sure your NDA is signed in front of a notary.

A notary public is a government-appointed official who witnesses the signing of important documents.

Notaries verify the identity of signers and their awareness of the details of the contract.

When drafting your notary section, be sure to include a line for the notary’s signature, the notary ID number, and the notary license expiration date.

If you want an easier and more time-efficient means of getting documents notarized, check out PandaDoc Notary .

Non-disclosure agreements vs. non-compete agreements

While non-disclosure agreements forbid parties from sharing trade secrets and other confidential information, it isn’t the only document that can give your business a competitive advantage. Enter, the non-compete agreement.

What’ is a non-compete agreement? This type of legal contract restricts employees or partners from competing in your industry during the business relationship or after it ends.

Many companies issue non-compete agreements to prevent their employees or former employees from jumping ship and working for their competitors.

You may want to consider adding a non-compete clause to your NDA if the benefits of such a clause sound tempting.

Including a non-compete clause streamlines your business’s competitive advantage.

Your employees or strategic partners will be fully aware of what they can and cannot do with your confidential information during your business relationship and after it’s ended.

If you do decide to include non-compete language in your NDA, be sure to include this in the title of your document in order to avoid confusion .

This can be as easy as stating “Non-Disclosure Agreement and Non-Compete Agreement” at the top of your document.

How to make an NDA legally binding

To ensure that your NDA is legally binding, follow these steps:

1. Include an integration clause

The integration clause is how you verify that the signed copy of your NDA is the final version. It allows parties to ensure that past statements cannot be used or included once the NDA is signed.

It can also state that any changes to the agreement will only be valid if added via an addendum.

2. Choose the applicable law

Select your choice of law for the NDA. This determines which law applies to the NDA if a lawsuit occurs. You can simply state that the agreement will be governed by the laws of the state in which you work.

3. Add a signature block

Create a space for signatures. Each party signing an NDA needs to be aware of how to sign an NDA correctly and have their own signature block, which should include a line for the signature, the printed name of the party, and the date.

It’s advisable to get all parties to sign your NDA before a notary who verifies the identity of the signing parties and their awareness of the contract details.

Ensure that you include a line for the notary’s signature, the notary ID number, and the notary license expiration date.

As well as ensuring that your NDA has been drafted and executed correctly, the contract should be supported by consideration.

What happens when someone violates an NDA?

Usually, having an NDA is enough to deter people from revealing confidential information. But when someone does violate the terms of an NDA, it can have very serious consequences.

NDAs are civil contracts, which means that breaking them isn’t technically a crime in of itself.

But depending on whatever laws are referred to in the NDA, violating it could come with large financial penalties.

Violating the terms of an NDA leaves you vulnerable to lawsuits from the other party, and you could be required to pay monetary damages and even the associated legal costs.

Revealing trade secrets or sensitive company information to a competitor is illegal, and it can carry legal consequences, which include fines and potentially being made subject to an injunction that forbids you from disclosing any relevant information.

For instance, this could happen in the case of you disclosing private information regarding patents, trademarks, or trade secrets.

The injunction would keep the partner or employee from working for or with a competitor, and the monetary damages would help make up for the violation.

How to write an NDA: Easy NDA templates from PandaDoc

Don’t worry if learning how to create a non-disclosure agreement still seems intimidating.

PandaDoc has excellent free non-disclosure agreement samples and templates to give you a good idea of what the completed document should look like.

Writing a non-disclosure agreement doesn’t have to be stressful.

If you’re feeling a little overwhelmed about writing your own NDA, consider PandaDoc’s easy-to-use NDA templates.

Hiring a law firm to draft an original NDA can be expensive .

Utilizing PandaDoc’s NDA template is a quick and compliant way to ensure your company’s confidential information is protected.

Let PandaDoc do the legwork while you rest assured your confidential information is protected.

Download the free printable confidentiality agreement form by PandaDoc today to see just how easy it is to draft your own NDA.

PandDoc is not a law firm, or a substitute for an attorney or law firm. This page is not intended to and does not provide legal advice. Should you have legal questions on the validity of e-signatures or digital signatures and the enforceability thereof, please consult with an attorney or law firm. Use of PandaDocs services are governed by our Terms of Use and Privacy Policy.

Originally published September 28, 2022, updated January 12, 2023

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This unilateral nondisclosure agreement is between , an individual a(n) (the " Disclosing Party ") and , an individual a(n) (the " Receiving Party ").

The Disclosing Party has developed certain confidential information that it wants to make available to the Receiving Party for the purpose of .

The Receiving Party wants to review, examine, inspect, or obtain the confidential information only for the above-described purposes, and to otherwise maintain the confidentiality of that information pursuant to this agreement.

The parties therefore agree as follows:

1. CONFIDENTIAL INFORMATION.

The Disclosing Party may (but is not required to) disclose certain of its confidential and proprietary information to the Receiving Party. " Confidential Information " means:

• (i) provided or shown to the Receiving Party or its directors, officers, employees, agents, and representatives (each a " Receiving Party Representative ") by or on behalf of the Disclosing Party or any of its directors, officers, employees, agents, and representatives (each a " Disclosing Party Representative "); or
• (ii) obtained by the Receiving Party or a Receiving Party Representative from review of documents or property of, or communications with, the Disclosing Party or a Disclosing Party Representative; and
• (b) all notes, analyses, compilations, studies, summaries, and other material, whether provided orally, in writing, or by any other media, that contain or are based on all or part of the information described in subsection (a) (the " Derivative Materials ").

The Disclosing Party shall identify Confidential Information disclosed orally as confidential within    days of disclosure. The Disclosing Party's failure to identify information as Confidential Information is not an acknowledgment or admission by the Disclosing Party that that information is not confidential, and is not a waiver by the Disclosing Party of any of its rights with respect to that information.

2. OBLIGATION TO MAINTAIN CONFIDENTIALITY .

• A. a Receiving Party Representative who needs to know the Confidential Information for the purposes
• of its business with the Disclosing Party;
• B. with the Disclosing Party's prior written authorization; or
• (ii) use the Confidential Information for any purposes other than those contemplated by this agreement.
• (b) No Reverse Engineering. The Receiving Party may not reverse engineer, disassemble, or decompile any prototypes, software, or other tangible objects that embody the Confidential Information and that are provided to the Receiving Party under this agreement.
• (c) Term. The Receiving Party shall, and shall require each Receiving Party Representative to, maintain the confidentiality and security of the Confidential Information until the earlier of: (i) such time as all Confidential Information disclosed under this agreement becomes publicly known and is made generally available through no action or inaction of the Receiving Party or (ii) the third anniversary of the disclosure. However, to the extent that the Disclosing Party has disclosed information to the Receiving Party that constitutes a trade secret under law, the Receiving Party shall protect that trade secret for as long as the information qualifies as a trade secret.

3. EXCLUSIONS.

The obligations and restrictions of this agreement do not apply to that part of the Confidential Information that:

• (a) was or becomes publicly available other than as a result of a disclosure by the Receiving Party in violation of this agreement;
• (i) the source of such information is not bound by a confidentiality agreement with the Disclosing Party or is not otherwise prohibited from transmitting the information to the Receiving Party or a Receiving Party Representative by a contractual, legal, fiduciary, or other obligation; and
• (ii) the Receiving Party provides the Disclosing Party with written notice of such prior possession either (A) before the execution and delivery of this agreement or (B) if the Receiving Party later becomes aware (through disclosure to the Receiving Party) of any aspect of the Confidential Information as to which the Receiving Party had prior possession, promptly on the Receiving Party so becoming aware; or
• (i) provide the Disclosing Party with prompt notice of any such request or requirement before disclosure so that the Disclosing Party may seek an appropriate protective order or other appropriate remedy; and
• (ii) provide reasonable assistance to the Disclosing Party in obtaining any such protective order.
• If a protective order or other remedy is not obtained or the Disclosing Party grants a waiver under this agreement, then the Receiving Party may furnish that portion (and only that portion) of the Confidential Information that, in the written opinion of counsel reasonably acceptable to the Disclosing Party, the Receiving Party is legally compelled or otherwise required to disclose. The Receiving Party shall make reasonable efforts to obtain reliable assurance that confidential treatment will be accorded any part of the Confidential Information so disclosed; or
• (d) was developed by the Receiving Party independently without breach of this agreement.

4. RETURN OF PROPERTY .

If the Disclosing Party requests, the Receiving Party shall, and shall cause each Receiving Party Representative to promptly (and no later than    days after the request):

• (a) return all Confidential Information to the Disclosing Party; and
• (b) destroy all Derivative Material and within   days of this destruction, provide a written certificate to the Disclosing Party confirming this destruction.

5. NO PUBLICITY.

The parties shall keep the existence of this agreement, and the transactions or discussions contemplated by this agreement, strictly confidential, except as required by law and except as the parties otherwise may agree in writing before a disclosure.

6. OWNERSHIP RIGHTS.

The Receiving Party acknowledges that the Confidential Information is, and at all times will be, the Disclosing Party's sole property, even if suggestions made by the Receiving Party are incorporated into the Confidential Information. The Receiving Party obtains no rights by license or otherwise in the Confidential Information under this agreement. Neither party solicits any change in the other party's organization, business practice, service, or products, and the disclosure of Confidential Information may not be construed as evidencing any intent by a party to purchase any products or services of the other party or as an encouragement to expend funds in development or research efforts. The Confidential Information may pertain to prospective or unannounced products. The Receiving Party may not use the Confidential Information as a basis on which to develop or have a third party develop a competing or similar plan or undertaking.

7. FUTURE PRODUCTS; RESIDUALS.

The confidentiality terms of this agreement do not limit the Receiving Party's right to develop or acquire products independently without use of the Confidential Information. Further, the Receiving Party may use for any purpose the residuals resulting from access to or work with the Confidential Information. However, the Receiving Party may not disclose the Confidential Information except as expressly permitted under this agreement. The term "residuals" means information in intangible form that is retained in memory by people who have had access to the Confidential Information, including ideas, concepts, know-how, or techniques contained in that Confidential Information. The Receiving Party is not required to limit or restrict the assignment of such persons or to pay royalties for any work resulting from the use of residuals. This section does not give the Receiving Party a license under the Disclosing Party's copyrights or patents.

8. NO OBLIGATION.

Nothing in this agreement obligates either party to proceed with any transaction between them, and each party reserves the right, in its sole discretion, to terminate the discussions contemplated by this agreement concerning the business opportunity, if any, and to cease further disclosures, communications, or other activities under this agreement on written notice to the other party. Any commitment to proceed with a transaction will be set forth in a separate agreement signed by the parties.

9. NO WARRANTY.

ALL CONFIDENTIAL INFORMATION IS PROVIDED "AS IS." THE DISCLOSING PARTY MAKES NO WARRANTIES, EXPRESS, IMPLIED, OR OTHERWISE, REGARDING THE ACCURACY, COMPLETENESS, OR PERFORMANCE OF ANY SUCH INFORMATION.

10. GOVERNING LAW; EQUITABLE RELIEF.

• (a) Choice of Law. The laws of the state of govern this agreement (without giving effect to its conflicts of law principles).
• (b) Choice of Forum. Both parties consent to the personal jurisdiction of the state and federal courts in County, .
• (c) Equitable Relief. The Receiving Party's breach of this agreement will cause irreparable harm to the Disclosing Party and monetary damages may not be a sufficient remedy for an unauthorized disclosure of the Confidential Information. If the Receiving Party discloses the Confidential Information in violation of this agreement, the Disclosing Party may, without waiving any other rights or remedies and without posting a bond or other security, seek an injunction, specific performance, or other equitable remedy to prevent competition or further disclosure, and may pursue other legal remedies.

11. AMENDMENTS.

No amendment to this extension will be effective unless it is in writing and signed by both parties or their authorized representatives.

12. ASSIGNMENT AND DELEGATION.

• (a) No Assignment. Neither party may assign any of its rights under this agreement, except with the prior written consent of the other party. All voluntary assignments of rights are limited by this subsection.
• (b) No Delegation. Neither party may delegate any performance under this agreement, except with the prior written consent of the other party.
• (c) Enforceability of an Assignment or Delegation. If a purported assignment or purported delegation is made in violation of this section, it is void.

13. COUNTERPARTS; ELECTRONIC SIGNATURES.

• (a) Counterparts. The parties may execute this agreement in any number of counterparts, each of which is an original but all of which constitute one and the same instrument.
• (b) Electronic Signatures. This agreement, agreements ancillary to this agreement, and related documents entered into in connection with this agreement are signed when a party's signature is delivered by facsimile, email, or other electronic medium. These signatures must be treated in all respects as having the same force and effect as original signatures.

14. SEVERABILITY.

If any provision in this agreement is, for any reason, held to be invalid, illegal, or unenforceable in any respect, that invalidity, illegality, or unenforceability will not affect any other provisions of this agreement, but this agreement will be construed as if the invalid, illegal, or unenforceable provisions had never been contained in this agreement, unless the deletion of those provisions would result in such a material change that would cause completion of the transactions contemplated by this agreement to be unreasonable.

15. NOTICES.

• (a) Writing; Permitted Delivery Methods. Each party giving or making any notice, request, demand, or other communication required or permitted by this agreement shall give that notice in writing and use one of the following types of delivery, each of which is a writing for purposes of this agreement: personal delivery, mail (registered or certified mail, postage prepaid, return-receipt requested), nationally recognized overnight courier (fees prepaid), facsimile, or email.
• (b) Addresses. A party shall address notices under this section to a party at the following addresses:
• If to the Disclosing Party:
• If to the Receiving Party:
• (c) Effectiveness. A notice is effective only if the party giving notice complies with subsections (a) and (b) and if the recipient receives the notice.

16. WAIVER.

No waiver of a breach, failure of any condition, or any right or remedy contained in or granted by the provisions of this agreement will be effective unless it is in writing and signed by the party waiving the breach, failure, right, or remedy. No waiver of any breach, failure, right, or remedy will be deemed a waiver of any other breach, failure, right, or remedy, whether or not similar, and no waiver will constitute a continuing waiver, unless the writing so specifies.

17. ENTIRE AGREEMENT.

This agreement constitutes the final agreement of the parties. It is the complete and exclusive expression of the parties' agreement with respect to the subject matter of this agreement. All prior and contemporaneous communications, negotiations, and agreements between the parties relating to the subject matter of this agreement are expressly merged into and superseded by this agreement. The provisions of this agreement may not be explained, supplemented, or qualified by evidence of trade usage or a prior course of dealings. Neither party was induced to enter this agreement by, and neither party is relying on, any statement, representation, warranty, or agreement of the other party except those set forth expressly in this agreement. Except as set forth expressly in this agreement, there are no conditions precedent to this agreement's effectiveness.

18. HEADINGS.

The descriptive headings of the sections and subsections of this agreement are for convenience only, and do not affect this agreement's construction or interpretation.

19. EFFECTIVENESS.

This agreement will become effective when all parties have signed it. The date this agreement is signed by the last party to sign it (as indicated by the date associated with that party's signature) will be deemed the date of this agreement.

20. NECESSARY ACTS; FURTHER ASSURANCES.

Each party and its officers and directors shall use all reasonable efforts to take, or cause to be taken, all actions necessary or desirable to consummate and make effective the transactions this agreement contemplates or to evidence or carry out the intent and purposes of this agreement.

[SIGNATURE PAGE FOLLOWS]

Each party is signing this agreement on the date stated opposite that party's signature.

Free Unilateral Non-disclosure Agreement Template

How-to guides, articles, and any other content appearing on this page are for informational purposes only, do not constitute legal advice, and are no substitute for the advice of an attorney.

Unilateral non-disclosure agreement: How-to guide

In today's cut-throat business world, keeping secrets safe is crucial to staying ahead and protecting what's valuable. Whether it's your special technology, big plans, or customer information, it's vital to stop others from using it without permission.

That's where the Unilateral Non-Disclosure Agreement (NDA) comes in. This legal document is like a shield, protecting your private information when you share it with others. Unlike mutual NDAs, where both sides have to keep quiet, a unilateral NDA mostly helps the one sharing the secrets by making the other side promise to keep things quiet.

In this guide, we'll dive deep into unilateral NDAs, explaining what they're for, what they include, and how to make one. Whether you're starting a business, running a company, or working with clients, understanding and using unilateral NDAs can help keep your secrets safe and protect what's yours.

What is a unilateral non-disclosure agreement (NDA)?

A unilateral non-disclosure agreement is a legally binding contract between two parties, where one party (the disclosing party) disclose secret information to the other party (the receiving party), imposing necessities on the other party to maintain the confidentiality of the disclosed information. In essence, it serves as a safeguard to protect sensitive company information from unauthorized leaks or use.

How is a unilateral NDA different from a mutual NDA?

Unilateral NDA : Also known as a one-way NDA, this type of agreement is commonly used when only one party is disclosing confidential information to the other party. The receiving party agrees to keep the information that is disclosed confidential and refrain from disclosing it to third parties or using it for unauthorized purposes.

Mutual NDA : Also known as a two-way or bilateral NDA, this type of agreement is used when both parties are disclosing confidential information to each other. In a mutual NDA , both parties disclose confidential information, agree to keep it a secret, and refrain from disclosing it to third parties or using it for unauthorized purposes.

These two types of NDAs serve different purposes and are utilized based on the specific circumstances of the business relationship and the nature of the confidential information being shared.

When do you need a unilateral non-disclosure agreement?

A one-way non-disclosure agreement is a must-have in situations where keeping secrets safe is a top priority. Here are some key times when using one is super important:

Sharing proprietary business information with third parties

Whether you're disclosing the secrets of a trade, proprietary technology, joint venture, or strategic company plan, sharing secret information with third parties, such as vendors, suppliers, or strategic partners, requires the implementation of this NDA. This agreement ensures that your private data remains protected and prevents unauthorized leaks or use by the receiving party.

Collaborating with freelancers, contractors, or consultants

Engaging freelancers, contractors, or consultants to work on projects often involves sharing private data about your company’s operations, processes, or intellectual property. Implementing a unilateral NDA in such collaborations is essential to safeguard your proprietary information.

Legal framework guiding unilateral non-disclosure agreements

When creating and enforcing Unilateral Non-disclosure Agreements (NDAs) in the United States, it's crucial to be mindful of the legal guidelines set forth by relevant laws and fundamental principles. Here's a rundown of the important laws and principles that shape NDAs:

1. Uniform Trade Secrets Act (UTSA)

The Uniform Trade Secrets Act  (UTSA) acts as a shield for trade secrets, which are often the lifeblood of the sensitive information covered in NDAs. Adopted by many states, this law sets rules for identifying, safeguarding, and enforcing trade secrets. NDA documents often include UTSA provisions to ensure that these valuable secrets are shielded from third parties.

2. Defend Trade Secrets Act (DTSA)

The Defend Trade Secrets Act  (DTSA), introduced in 2016, offers federal protection for trade secrets, complementing state laws like the UTSA. Here, the trade secret owners can seek remedies such as injunctions, damages, and legal fees. The DTSA even has a provision for emergency orders to stop stolen trade secrets from spreading. NDA documents often refer to the DTSA to make sure they're in line with federal trade secret laws.

3. Common law principles of contract and confidentiality

In addition to statutory laws like the UTSA and DTSA, unilateral NDAs are also shaped by  everyday legal principles of trust and privacy . These principles lay the groundwork for how contracts, including NDAs, are understood and upheld. They also recognize the importance of keeping sensitive information confidential, especially in relationships like between bosses and employees, even without a formal agreement. NDA documents often nod to these principles to make sure everyone's rights and responsibilities are crystal clear.

Elements of a unilateral non-disclosure agreement

Let's take a closer look at what makes up these confidentiality agreements:

1. Identifying the parties

In an NDA, it's important to know who's in the picture. The disclosing party is the one sharing the private information, while the receiving party is the one promising to keep it under wraps. This part should include the full names and contact information of both parties to make sure everyone knows who's who.

2. Defining the confidential information

The NDA needs to clearly state what kind of information is considered confidential and should be kept secret. By being clear about what's private, the NDA makes sure everyone knows what's covered by the agreement.

3. Understanding the “obligations of the receiving party”

The NDA should outline the responsibilities and necessities of the party who is receiving the information regarding the handling and protection of confidential data.

The NDA should lay out what the receiving party needs to do to keep the information safe. This might mean promising to keep things confidential, not sharing or using the info for anything unauthorized, and taking reasonable steps to make sure it stays protected. Plus, the receiving party might have to limit who can see the information and give it back or let go of it if the disclosing party asks or if the agreement is terminated.

4. Understanding what is “no reverse engineering”

Reverse engineering is like taking apart a puzzle to see how it works. The "no reverse engineering" rule in a Unilateral Agreement (NDA) is like saying, "hands off" to the receiving party.

This rule makes sure the receiving party can't try to copy or figure out the secret information by taking it apart or analyzing it. It's all about keeping things safe and secure.

5. Duration of the agreement

Think of the NDA like a clock—it needs to say how long it's ticking. Mention the period, like a year, or until the secret information isn't secret anymore. And if things go south, there should be a way to end it early, like if both sides agree or if someone breaks the rules.

6. Governing law and jurisdiction

In the non-disclosure agreement, specify the applicable rules and the venue for dispute resolution. This involves stating the governing laws and the courts responsible for resolving disputes that may arise.

7. Exclusions

"Exclusions" in a Unilateral NDA are specific types of information that don't count as secrets and don't have to follow the confidentiality rules in the agreement. Here are a few examples:

• Information already in the public domain : If information is already out there for everyone to see, it doesn't count as secret. No blame comes to the receiving party if it's already public.
• Information independently developed by the receiving party : If the receiving party figured out the information on their own without using the disclosing party's secrets, it's not covered by the NDA.
• Information received from third parties : If someone else gave the receiving party the information legally and without any strings attached, it's not part of the NDA.
• Information disclosed with consent : If the disclosing party said it's okay to share the information, then it's not a secret anymore. Both parties have to agree to share it for it to count.

Tips for drafting a comprehensive document

When it comes to drafting a Unilateral Agreement (NDA), you've got to think it through to make sure it's strong enough to keep your confidential information safe and keep trouble at bay. Here are some important tips to help you create a solid NDA:

1. Customize the agreement to the specific needs and circumstances of the parties involved

Each business relationship and secret shared is unique. Make sure the NDA fits like a glove, addressing the specific needs, worries, and hopes of both sides. Consider things like what's being shared, how you know each other, and why you're sharing it. Tailoring the agreement means it's more likely to work for everyone and keep their interests safe.

2. Seek legal advice

Bring in legal help who has expertise when it comes to contracts and protecting ideas. They'll help make sure the NDA follows the rules and covers all the bases. Consulting a legal counsel can save you headaches later on and make sure that everyone's protected as best as possible.

3. Clearly define terms

Confusion in the NDA language can lead to disagreements. Use plain, easy-to-understand terms like "confidential information," "disclosure," "use," "duration," and "termination." Give examples to show what you mean and avoid vague wordings. Clear language makes sure everyone knows what they're agreeing to and keeps things running smoothly.

4. Consider the scope of confidentiality

Think carefully about what information the NDA protects and what it doesn't. Spell out exactly what's considered private—like trade secrets or customer lists—and what's not, such as information already out there or shared with permission. By setting clear boundaries, you can make sure the NDA does its job of keeping secrets safe while still letting business happen.

Getting started with safeguarding your secrets is easy with the free Unilateral NDA template from LegalZoom—it's like having a trustworthy guide to help you protect your valuable assets and navigate the complexities of business relationships with confidence.

As businesses work with others and share secrets, using Unilateral NDAs is a must. They’re a way to build trust and keep relationships strong. So, whether big or small, businesses should make unilateral NDAs a part of their routine. It's not just about legal paperwork—it's about keeping secrets safe, staying ahead in the market, and building trustworthy relationships in today's fast-paced business world.

Frequently asked questions

What's a unilateral non-disclosure (nda) agreement.

A unilateral nondisclosure agreement, or unilateral NDA, safeguards confidential company information such as customer data, inventions, and secrets of trade. It clarifies what information is confidential and helps prevent accidental leaks of proprietary details, technology, and intellectual property.

By establishing clear guidelines for confidentiality, an NDA informs colleagues about what should be kept confidential, reducing the risk of the secrets of a trade falling into competitors' hands.

To complete a unilateral nondisclosure agreement effectively, you'll need the following information ready:

• Sender's information : Your name or your company's name and contact details
• Recipient's information : Name and contact details of the party being asked to sign the NDA
• Project details : Explanation of the project or arrangement involved with the second party
• Effective timing : Determination of the agreement's start date and any associated deadlines

What are the five key elements of a non-disclosure agreement?

The five key elements of a non-disclosure agreement (NDA) typically include:

• Identification of the parties
• Definition of confidential information
• Obligations of the receiving party
• Duration of the agreement
• Governing law and jurisdiction

What are the types of NDA?

Predominantly, NDAs are of three types:

Unilateral NDA : Also called a one-way NDA, when a deal happens and one side shares secrets with the other. The receiver pledges to keep the disclosed information private and not share it with outsiders or misuse it.

Mutual NDA : Also known as a two-way or bilateral NDA, this pact comes into play when both parties share information. Both sides agree to keep each other's secrets confidential and not share them with third parties or misuse them.

Multilateral NDA : In this agreement, multiple parties share confidential information among themselves while agreeing to keep it confidential. It's like a circle of trust where everyone keeps each other's secrets safe.

These NDAs serve different purposes and are used based on the specifics of the business relationship and the confidential information shared.

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