NDA Agreement Overview

A non-disclosure agreement (NDA) is a legal contract that states certain information to be confidential and the extent to which its disclosure is restricted to third parties. It can be entered into with a person or an organization.

Confidential information includes trade secrets, business plans, business methods and strategies, drawings, charts, and so on. Software programs and code are also included in the category of confidential information. Consultants and agencies are usually asked to sign one to protect trade secrets as they mostly work with multiple organizations within the same industry.

Types of Non-Disclosure Agreement

• One-way or unilateral agreement - Here, only one party has the confidential information to be shared with another party. The party in possession is called the ‘disclosing party’ and the other one is named the ‘receiving party’.
• Two-way or bilateral agreement - Here, two parties are involved and both have the confidential information to be shared.
• Multilateral agreement - Here, 3 or more parties are involved. One of them discloses sensitive or confidential information and the others promise to protect such information from further disclosures.

Benefits of a NonDisclosure Agreement

• Protects Business Secrets- An NDA is one of the most common ways to protect trade secrets and other confidential information. Consultants and agencies are usually asked to sign one to protect trade secrets.
• Enhances Client Relationships- Businesses that work on third-party projects require their employees to sign non disclosure agreements, to restrict the use and disclosure of confidential information, and assure clients that their data is safe

NDA Agreement Format

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Key Elements of Non-disclosure Agreement

The following essential clauses should be present in a legitimate nondisclosure agreement:

• The Parties-This section will mention if the nondisclosure agreement is a unilateral, bilateral, or multilateral one. The details of the party/parties (names, addresses, etc) involved should be mentioned in this part.
• Term of the Agreement- The non disclosure agreement template must mention the date of execution of the agreement and the duration of the existence of the same. It should also mention if the rules and obligations related to disclosure of information will be applicable after the expiry of the nondisclosure agreement or not.
• Confidential Information- The non disclosure agreement format must specify what information is to be kept in the ‘confidential’ category or to be protected.
• Disclosure of Confidentiality- This section of the non-disclosure agreement specifies the intentions for which the confidential data/information will be used. It will also specify with whom such information can be shared.
• Dispute Resolution- The non disclosure agreement must mention the remedial measures the parties will resort to, to resolve disputes, if any. It will include alternative forms of dispute resolution they may choose to employ, such as arbitration.

How to Write a Non-Disclosure Agreement?

• Step 1: Once you send in a request, our representative will get in touch with you to understand your requirements
• Step 2: If we require more details, we will contact you for the same
• Step 3: Once these are received, we will work on the request and send the non-disclosure agreement format for your review within 3 to 4 working days

Note: In case you would like any changes to the nondisclosure agreement format, our law consultant will work on them. Two rounds of iterations are included in the original price.

Exclusions to NDAs

An NDA, or non-disclosure agreement, is a legal contract between two parties that outlines what information is confidential and agrees that the receiving party will not disclose that information to unauthorized third parties. However, some exclusions exist to what is regarded as confidential information under an NDA. These exclusions typically include:

• Information that is already in the public domain.
• Information that the receiving party already knows or can independently obtain.
• Information that is disclosed by the disclosing party with the express consent of the disclosing party.
• Information that is disclosed by the receiving party under a legal obligation, such as a court order.

Real-World Example of an NDA

• In 2018, the Indian government signed an NDA with Google to develop a cloud-based platform for storing and processing government data. The NDA was designed to protect the confidentiality of the government data.
• In 2020, the Indian pharmaceutical company Cipla entered into an NDA with the US pharmaceutical company Gilead Sciences to develop a generic version of Gilead's HIV drug Truvada. The NDA was designed to protect the confidential information related to the development of the generic drug.
• In 2021, the Indian startup Unacademy entered into an NDA with the Chinese technology company Tencent. The NDA was designed to protect the confidential information related to Unacademy's business plans and operations.

When Do You Need a Non-Disclosure Agreement?

You need an NDA whenever you are sharing confidential information with someone who is not your employee or agent. This could include situations such as:

• Hiring a consultant
• Entering into a joint venture
• Negotiating a merger or acquisition
• Sharing trade secrets or intellectual property
• Discussing new product development
• Seeking funding from investors

Requirements for an Non-Disclosure Agreement

• Identification of the Parties: The NDA should clearly identify the parties involved in the agreement.
• Definition of Confidential Information: The NDA should define the types of confidential information that are covered by the agreement.
• Scope of the Agreement: The Non-Disclosure Agreement should outline the terms of the contract, including how long the confidentiality obligation will last.
• Exceptions to Confidentiality: Any exceptions to the confidentiality obligation, such as information that is already public knowledge, should be specified in the NDA.
• Obligations of the Recipient: The NDA should outline the obligations of the recipient, including the duty to maintain confidentiality and restrictions on the use of confidential information.
• Remedies for Breach: The Nondisclosure Agreement should specify the remedies that are available in the event of a breach of the agreement, such as injunctive relief or monetary damages.
• Governing Law and Jurisdiction: The NDA should specify the governing law and jurisdiction that will apply in the event of a dispute.