Whether you own a technology company or a manufacturing facility, protecting your company’s secret, competitive advantages is vital to your long-term business success. A Non-disclosure Agreement, also called an NDA or Confidentiality Agreement, is a type of contract that helps protect your trade secrets and specific intricacies of your business. In an NDA, you and another party (often an employee, but sometimes partnering businesses or potential investors) promise to protect secret and confidential information for a specific to unlimited period of time. If someone signs an NDA with you and they decide to go ahead and share the now-protected confidential information without your permission, you can ask the court to stop that person from sharing any more information and may even receive compensation for any damage you incur from the information leak.
Confidentiality Agreements Should Be Among the First Signed
Since new businesses often have unique new ideas and formulas, we recommend that an NDA be one of the first documents drafted when initially forming new partnerships, receiving investor support, and creating employee relationships.
Large purchase agreements also usually involve NDAs. This is because parties to large purchase agreements and mergers and acquisitions deals desire to keep secret information about their companies and property secret during and after negotiations, whether or not successful. Learn more by reading our articles entitled “Confidentiality in Mergers & Acquisitions: When, Who, and What” and “When Is a Confidentiality Agreement a Good Idea?“
When the NDA is well-written by a Non-disclosure Agreements attorney who knows the inner workings of your business, your confidential information is protected from unwarranted leaks and disclosures.
Benefits of Confidentiality Agreements
The single greatest benefit provided by an NDA is increased peace of mind because your valuable information is legally protected. In conjunction, there are derivative benefits:
- An assurance that any value lost from a disclosure will be contractually protected.
- Ease and security of sharing confidential information with partnering organizations as well as receiving confidential information from other businesses, which allows for more and better collaboration.
Oral vs. Written
While a confidential relationship can be created through an oral agreement or can even be implied, this type of informal arrangement can cause more harm than good. This is because it is difficult to prove the relationship in a court of law. If the agreement is written, then the proof and the protection provided by the agreement are present up front.
Contact a Minnesota Confidentiality Agreement Attorney
If you are considering an NDA for your business, contact our site sponsor, Vlodaver Law Offices, LLC, for a free consultation to determine the type of NDA agreement that is most appropriate for your business.