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Non-disclosure agreements: How NDAs can help you

by | Mar 19, 2021 | Business Law

Non-disclosure agreements (NDAs), sometimes referred to as confidentiality agreements, are legal resources that help guard your confidential information. Many companies, from big corporations to small start-ups, may deem it necessary to utilize non-disclosure and/or confidentiality agreements. Learn more about the basics of non-disclosure and confidentiality agreements and how lawyers can help you draft and negotiate your agreements.

Non-disclosure agreements can help people keep important information confidential

Why use a non-disclosure agreement?

An NDA enables a company to keep its confidential and secret information just that: a secret. Specifically, a non-disclosure agreement requires individuals and entities to keep confidential information secret and not disclose this information to anyone else. NDAs also often involve a particular amount of time in which they are enforceable. This time frame is to be explicitly stated in the agreement, along with the specific information that is meant to be kept confidential.

What types of non-disclosure agreements are there?

There are two basic types of NDAs: unilateral and mutual. Most non-disclosure agreements are unilateral; however, mutual agreements are also seen in the business world.


A unilateral (or non-mutual) non-disclosure agreement is a very common practice in the business world. It is essentially when one party cannot leak information about another party to anyone else. A good example of this is where a business makes an employee sign an NDA to keep the confidential information the employee learned on the job a secret.


On the other hand, mutual NDAs involve two parties sharing confidential information where the information being shared is strictly protected by the agreement. In general, we often see these agreements in industries involving new technology, new or secret processes or equipment, proprietary blends and recipes, data, and industry-specific customer lists. Both companies may be partnering up with each of their new technologies to invent something innovative and groundbreaking. Each company would have an interest in holding the other party accountable with their valuable information. A mutual non-disclosure agreement assists with this endeavor.

What should be included in a non-disclosure agreement?

There are several items that NDAs should include to create a clear and enforceable agreement. These include:

  1. The definition of the confidential information (i.e. describing the particular information that will be protected);
  2. Each party’s permissible use of the information;
  3. The parties involved in the agreement; and
  4. The timeframe of the agreement.

By clearly defining the information that must be kept confidential, the parties have established the baseline of what is to be kept secret. However, the agreement also must spell out how and in what form or manner the parties are to use the information subject to the agreement. The parties involved should be stated clearly so that there is no dispute with who must adhere to the agreement. Lastly, the timeframe of the agreement should be clearly stated and reasonable.

How can experienced lawyers help you?

It is important that your NDA contains all the components you would like. It needs to abide by the federal and state laws in the place the business resides. The corporate & business law attorneys at McDonald & Kloth, LLC can help you draft your non-disclosure agreement.