Obtain NDAs to keep confidential information safe without slowing down your work.
Protect your business with nondisclosure agreements.
What is a nondisclosure agreement?
A nondisclosure agreement (NDA) is a legal document between two or more parties who agree not to disclose any sensitive information revealed over the course of doing business together. NDAs protect confidentiality between doctors and patients, solicitors and their clients and business owners and their employees and contractors.
Confidentiality agreements are important for small businesses and startups both in and out of the tech world. If you have a great idea, technology or proprietary formula you want to sell, you probably need to share it with others in order to seek funding, start production and bring your product to market. Your business plan itself and valuable customer lists might also need protection. With an NDA, you can safeguard your leads and ideas while you raise money and hire employees or freelancers.
When to obtain an NDA.
Consider using an NDA any time you enter into a confidential relationship or before you do the following:
- Discuss the sale or licensing of your intellectual property, including any product or technology.
- Grant employees or contractors access to trade secrets or other proprietary information.
- Present an offer to potential investors, partners or prospective buyers.
Different types of NDAs.
Mutual. The mutual NDA form is just that: All involved parties agree to keep information confidential.
Non-Mutual. These agreements cover situations in which only one party (the discloser) is sharing confidential information with another or several parties (the receivers). And the receivers are required to keep the information secret.
Multilateral. Multilateral NDAs cover three or more parties sharing proprietary information. One or more parties may disclose sensitive information and all receiving parties promise to protect it. When many parties are involved, these types of NDAs are more efficient than establishing multiple separate agreements.
Terminating. These are NDAs that expire. After an agreed-upon time period, the disclosing party releases the receiving party from the agreement. The agreement may end on a specific date or when the business relationship ends.
Non-Terminating. These agreements never expire and the receiving party is bound to keep the information secret for as long as the parties work together or until the information becomes publicly available.
What to include in an NDA.
A nondisclosure agreement can include quite a bit of information and it’s always a good idea to get legal advice before executing one. These are some of the most common and important items to include:
- Definition of the sensitive or proprietary information. What information does the agreement cover? What are the reasons for the disclosure?
- Identification of the parties to the agreement. Who is the discloser and who is the recipient?
- Specific clauses and distinctions. Must the recipient make their best effort to keep the information secret? Do they receive information on a need-to-know basis? Is the information “no use,” meaning that the recipient has no right to use the information in any way other than directed in the agreement?
- Exclusions. What information doesn’t count as secret?
- Obligations of the recipient(s). What must the recipient do with the information they receive? What can’t they do?
- Time periods. Does the agreement last for a specific time period or for the length of a project or business partnership?
- Other terms. Who pays the legal fees? How will disputes be resolved? After a certain time period, can the recipient hire the discloser’s employees?
Complete nondisclosure agreements fast with Acrobat Sign.
Create your NDAs as soon as you’ve decided to engage in a joint venture or other business relationship. The sooner the agreements are signed, the sooner you can move the business forward. With Acrobat Sign, you can send an agreement securely as a PDF in four quick steps. Then track its progress. Your future partners, investors and employees can add their legally binding e-signatures from any device and you can get right to work.
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