A non-disclosure agreement (also referred to as an NDA or confidentiality agreement) is a contract between two parties promising to keep certain information confidential.
If you need a standard NDA, download our fillable form below:
Skip ahead to learn how to write an NDA.
There are three key components of a non-disclosure agreement:
- Confidential information: The information that the NDA applies to. Confidential information is often sensitive, technical, commercial, or valuable in nature (e.g., trade secrets, proprietary information).
- Disclosing Party: The party that owns the confidential information. They can be an individual, company, or entity.
- Receiving Party: The recipient of the confidential information, who agrees to keep the information private. They can be an individual, company, or entity.
Both parties sign the non-disclosure agreement, creating a binding contract to keep the confidential information secret.
When to Use a Non-Disclosure Agreement
Use an NDA if you own intellectual property or private information that employees, business partners, visitors, third parties, or candidates may have access to.
Non-disclosure agreements are valuable if you engage in any of the following activities:
- Documentary / news production
- TV / film production
- Illustrating / graphic design
- Inventions / prototyping
- Web design
- Software development
- Affiliate deals
- Advertising / marketing
Employment & Hiring
- General employment
- Agency partnerships
- Third-party services
- Visitor / factory tours
- Bachelor / bachelorette parties
- Celebrity meet-and-greets
- House tours
- Original artwork
If any of these scenarios apply to you, and involve sensitive, proprietary, or confidential information, use an NDA to protect your rights by establishing a contract of secrecy.
How to Write an NDA
Write a non-disclosure agreement using one of the following methods:
If you choose to download and fill in an NDA template or to write an NDA from scratch, read on to learn what clauses need to be included in your NDA, how to write them, and what they should look like.
What to Include in an NDA
A standard non-disclosure agreement includes the following clauses:
1. Disclosing and Receiving Parties
Start your NDA by establishing the “Parties” to the agreement. The “Disclosing Party” is the individual or entity sharing information, while the “Receiving Party” is the individual or entity receiving information.
Here’s an example of how to start an NDA and establish the Parties to the agreement. Notice that the sample NDA clause also specifies what transaction or relationship the NDA relates to:
2. Confidential Information
After the Parties have been established, specify what confidential information is protected by the non-disclosure agreement.
Common examples of NDA-protected confidential information include:
- Trade secrets
- Inventions / prototypes / samples
- Patent details
- Drawings / designs / documents
- Hardware / software configurations
- Original code
- Original ideas
- Pricing structures
- Business / financial records
- Client information
- Contact information
- Marketing materials
- Original research
These are only a few examples of the types of information you wish to keep confidential under the protection of your NDA. Your agreement can list as many or few items of confidential information as needed, but you need to be specific about what information the Receiving Party is not permitted to disclose.
Here’s a sample Confidential Information clause in an NDA:
3. Exclusions from Confidential Information
An “Exclusions” clause defines what kind of information is not protected by the NDA.
Information that can’t be protected by a non-disclosure agreement includes:
- information already in the public domain
- information the other party already has access to prior to the NDA
- information that is independently developed or discovered by the recipient
- information that the Disclosing Party has authorized the Receiving Party to share with prior written consent
Here’s an example of what your Exclusions clause should look like:
4. Non-Disclosure Obligations
The bulk of your NDA will be made up of Non-Disclosure Obligations, which outlines what obligations the Receiving Party has to the Disclosing Party’s information.
Rather than being a single clause, this section will likely be comprised of multiple clauses that detail various obligations.
This section will start with a clause like in the example below, which states the broad obligation of the Receiving Party to keep the confidential information quiet.
You can add additional clauses to this section of your NDA, depending on your needs. Here are some other clauses you may choose to include in your Non-Disclosure Obligations section:
1. Non-Disclosure of Transaction: the Receiving Party promises to not let others know that:
- the Disclosing Party has shared or used Confidential Information.
- a Transaction is being discussed or negotiated.
- a Transaction has taken place, including the details of the relationship.
2. Non-Solicitation: either party may prevent the other from soliciting or offering employment to the other party’s employees, or from diverting business away from the other party.
3. Non-compete: Parties agree not to engage in business activities that directly compete with the other Party.
4. Non-Circumvention: if the Disclosing Party is sharing business contacts, a non-circumvention clause prevents the Receiving Party from bypassing the agreement and directly doing business or engaging with those contacts.
In the NDA sample below, you can see how these clauses may look in an agreement:
These are only a few examples of Obligations clauses you may choose to include in your NDA.
5. Time Frame / Termination
The NDA should explicitly state how long it remains in effect. The Time Frame includes when the promise to keep confidential information secret begins (the “Effective Date”), and the duration in which the protected information must not be shared with others (the “Disclosure Period”).
Usually, the Parties agree to when the term of the agreement will end (known as the “Termination” provision). For example, the non-disclosure agreement could terminate when:
- the Agreement expires
- the Transaction is completed; or
- a specific time period has passed.
The Jurisdiction clause establishes which state’s laws govern the non-disclosure agreement. If confidential information is leaked or inappropriately used by one party and a lawsuit ensues, the laws of the agreed-upon state will apply, and any trials or hearings will take place in that state.
Finally, your NDA needs to include the signatures of all Parties and their Representatives.
Representatives are other people (i.e., directors, officers, employees, agents, or advisors) who may share, receive, or protect information in pursuit of the Transaction specified in the NDA.
Here’s an example of the Disclosing Party’s signature section:
Directly below this is the Receiving Party’s signature section, which is identical.
8. Additional Clauses
Depending on the nature of the transaction, relationship, and information being specified, every NDA will end up looking different. There are additional clauses you may choose to include in your own non-disclosure agreement:
- Remedies: specifies the consequences of breaking the NDA
- No License: provides that the NDA doesn’t give either party any patent, copyright, or ownership of the information provided.
- Severability: states that if one part of the NDA is ruled invalid in court, that part will be removed, and the rest of the agreement remains valid.
- Amendments: notes that the NDA may be amended at any time.
Types of NDAs
You can use different types of non-disclosure agreements for different situations:
Use a standard NDA to establish an agreement between two parties not to share any of the confidential information outlined in the non-disclosure agreement. The free NDA template above is an example of a standard NDA.
Use an employee NDA to forbid employees from sharing sensitive business information (except when appropriate), or risk breaching their employment contracts. Some companies make this agreement standard for all employees.
Use an interview NDA when it’s necessary to reveal confidential information to potential employees. For example, if you’re trying to recruit a new executive for your company, you may need to reveal business secrets. You should protect these secrets using an interview NDA, which needs to be signed before the job interview.
Use an inventor NDA to protect unpatented inventions. When it’s necessary to share information about an invention with other engineers, investors, or even family members, an inventor NDA ensures that nobody can easily disclose or steal the information.
Real Estate NDA
Use a real estate NDA to protect the personal and financial information of the buyer, seller, broker, and anyone else involved in a property transaction. This form of NDA also prevents involved parties from brokering secret deals, or leaking sensitive material to competing property owners.
Trade Secret NDA
Use a trade secret NDA to safely disclose trade secrets to third parties or partners without fear of theft. Trade secrets include such items as:
- Special formulas
- Technical designs
- Customer lists
Frequently Asked Questions About NDAs
For more information about NDAs and related agreements, check out our FAQ resources below: