An NDA is exactly what its name implies — a legal agreement between two or more parties that(i) defines certain confidential information that will be disclosed and (ii) imposes a legal obligation on the receiving party to keep that information confidential.
A Non-disclosure agreement (NDA), also known as a confidentiality agreement (CA), confidential disclosure agreement (CDA), proprietary information agreement (PIA), or secrecy agreement (SA). It is a legal contract between at least two parties that outlines confidential material, knowledge, or information that the parties wish to share with one another for certain purposes, but wish to restrict access to or by third parties.
It is a contract through which the parties agree not to disclose information covered by the agreement. An NDA creates a confidential relationship between the parties to protect any type of confidential and proprietary information or trade secrets. As such, an NDA protects non-public business information.
When you go to work for a company that requires you to sign an NDA, or you are a company looking to hire employees under a nondisclosure agreement, you will generally see at least five basic elements in the nondisclosure agreement. These are:
- The definition of “confidential information” that the NDA deals with;
- Any exclusions from the confidential information;
- The obligations and duties of the party receiving the confidential information;
- The time periods for which the NDA will be valid and enforceable; and
- Any miscellaneous provisions.