Non-Disclosure Agreement Draft

What a good one includes

• A precise definition of what constitutes confidential information, specifying whether it includes oral disclosures, physical documents, or digital files.
• Clear exclusions from confidentiality, such as information that is already publicly known or was independently developed without using the shared secrets.
• A specific clause outlining the exact purpose for which the receiving party can use the shared information, such as evaluating a potential business partnership.
• The exact duties of the receiving party, establishing that they must protect your secrets with at least the same level of care they use for their own sensitive data.
• A realistic term of confidentiality that specifies how long the receiving party must keep the information secret, even after the initial relationship ends.
• A remedies clause detailing the legal and financial consequences of a breach, including your right to seek an immediate injunction to stop further disclosures.

Common mistakes to avoid

• Writing a definition of confidential information so broad and all-encompassing that a court deems the entire agreement unreasonable and unenforceable.
• Failing to state a specific expiration date for the confidentiality obligations, which can invalidate the agreement under certain local state laws.
• Using a unilateral (one-way) agreement when both parties are actually sharing sensitive information, leaving one side entirely unprotected.
• Forgetting to include a clause that requires the receiving party to return or certify the destruction of all shared materials once discussions conclude.

Frequently asked questions