WHAT IS AN NDA?
A Non-Disclosure Agreement (“NDA”) is a legally enforceable written contract between two or more parties that signifies that a confidential relationship exists between the parties involved. NDAs are sometimes referred to as Confidentiality Agreements. Each NDA is unique and yours must be tailored to who the signing party is and what private information will be exposed.
WHEN IS IT USED?
An NDA should be put in place before confidential information is disclosed to potential clients, suppliers, investors and creditors.
I insist that a signed NDA be put in place with my private clients (even prospects) and me before we discuss any project details. General discussions during which specific information is not exchanged is my only exception. On the flip side, I had NDAs in place with each and every person who had knowledge of RestoPresto®, my wearable blanket product invention, before I revealed it to the public. My current use of NDAs occurs when I share private information about RestoPresto® or my business that is not publicly available.
WHY DO YOU NEED ONE FOR YOUR BUSINESS?
The NDA will bind all parties to secrecy and prevent disclosure of the information shared. Having confidentiality in writing and signed by all parties can lend trust to the dealings with the signed parties as well as deter theft of intellectual property.
WHO PROVIDES THE NDA and WHERE CAN I GET ONE?
In my experience, the discloser (person who will be sharing the confidential information) often provides the NDA to the party receiving the information because the discloser wants to be in control of the document. If the reverse occurs, it is important to ensure that the source of the document has your best interest at heart.
Regardless of who provides the NDA, the agreement must be drafted by an attorney with NO exceptions and thoroughly reviewed by both parties as well as her/his own legal counsel (to ensure that it is properly protecting each party) before signing it.
It is worth stating that I am not an attorney (although I play one on TV – just kidding) and rely heavily on my lawyers for all things legal. I strongly suggest you do the same and if you need a referral, please let me know.