A non-disclosure agreement (NDA) is a contract where one or both sides promise to keep certain information confidential. They're routine in business but often badly drafted — and sometimes badly used. Here's how to think about them.
A one-way (unilateral) NDA protects information shared by one party with another. A mutual NDA protects both directions and is standard when two companies are exploring a partnership or merger.
Vague NDAs that try to cover "any information shared" tend to be unenforceable. Define what's confidential (e.g., "information marked confidential" or specific categories) and what's excluded (publicly available, independently developed).
Most NDAs have a term — often 2 to 5 years for the disclosure period and a similar additional confidentiality period. Indefinite NDAs are sometimes unenforceable, especially in employment contexts.
Standard exceptions: information that becomes public, was already known, was independently developed, or is required to be disclosed by law. Remedies usually include injunctive relief plus damages — without them, NDAs are toothless.
Some NDAs include non-compete or non-solicitation clauses buried in the back. Some require disputes go to a particular forum or use a particular law. These aren't "just NDAs" — they're contracts. Read every word.
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