These two terms are very important when you’re signing a contract, and it’s crucial to understand what they mean before you sign them.<\/p>\n
A confidentiality agreement<\/strong><\/a> is a legally binding document that protects sensitive information, confidential material, or any information that the parties would not like third-parties to know. A Non-Disclosure Agreement<\/strong><\/a> is the same thing. The parties are entering into a contract agreeing that they will not disclose any of the information in the written contract. You can download a confidentiality agreement template<\/strong><\/a> or a NDA template<\/strong><\/a> from LawDepot<\/a>.<\/p>\n These agreements are commonly used by companies, stopping their partners from sharing their proprietary information to other businesses if something doesn’t work out. The idea is to secure business ideas, and stop the other party from stealing these ideas as their own. This is also a good idea when giving a presentation of a business idea, new invention, new product or new technology to potential investors or partners.<\/p>\n Confidentiality agreements are also signed by employees of a business that are using or have knowledge of something proprietary, such as a specific recipe. In certain restaurant chains, these signature recipes would need to be kept confidential, and cooks sign an NDA (Non-Disclosure Agreement) upon their day of hire.<\/p>\n Usually, the non-disclosure agreement contains any information that is generally not well-known, or not known at all. This also includes:<\/p>\n These agreements can be written up two different ways. The non-mutual agreement is one-sided in that the belief is that only one side has the potential to share information. This is the more common type of the two choices. A mutual agreement is good if both sides are planning on sharing information. It’s usually in the best interest of the company to only use the non-mutual agreement, and not provide any confidentiality that isn’t demanded by the other party.<\/p>\n There are some other provisions that might be included in the NDA, just to ensure that the company is protected in various ways. Much of this will depend on the company, but they’re all good items to consider adding. These include:<\/p>\nWho Needs a Non-Disclosure Agreement?<\/h2>\n
What’s Written in a Non-Disclosure Agreement?<\/h2>\n
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Mutual and Non-Mutual Non-Disclosure Agreements<\/h2>\n
Additional Provisions<\/h2>\n
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Drafting your Confidentiality Agreement or NDA<\/h2>\n