A non-disclosure agreement protects confidential information shared between parties. Here is what a solid NDA includes, the difference between one-way and mutual NDAs, and a free way to generate one.
A non-disclosure agreement (NDA), also called a confidentiality agreement, is a contract in which one or both parties agree to keep certain information secret and to use it only for an agreed purpose. Companies use NDAs with employees, contractors, vendors and partners before sharing sensitive information.
A one-way (unilateral) NDA protects information disclosed by a single party. A mutual NDA protects information shared by both, and is common when two businesses explore working together.
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What should an NDA include?
A solid NDA defines what counts as confidential information, states the permitted purpose, sets out the receiving party's obligations, lists exclusions, specifies how long the obligation lasts, covers return or destruction of information, and states the governing law.
What is the difference between a one-way and a mutual NDA?
A one-way (unilateral) NDA protects information disclosed by a single party, typically when one company shares information with an individual. A mutual NDA protects information shared by both parties, common when two businesses explore a deal together.
How long should an NDA last?
The confidentiality period is negotiable and depends on how long the information stays sensitive. Common terms range from two to five years, though trade secrets may be protected for as long as they remain secret.
Is an NDA legally binding?
Yes, a properly drafted and signed NDA is a binding contract. Its enforceability depends on being reasonable in scope and duration and on the governing law you choose, so have significant agreements reviewed before signing.
Please note: Outputs are AI-generated and can contain errors. Use them as a starting point and check anything important before you act on it.
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