Here's what you'll find in the Confidentiality Agreement :

  • A contract template for individuals or companies who wish to protect proprietary information
  • Tips on how to customize your confidentiality
  • Advice on getting contracts signed quickly, digitally, and legally
Download Now

Confidentiality Agreement Template

A confidentiality agreement is a legal document used to protect privileged information. A confidentiality agreement can be used by individuals or companies to protect proprietary information.

This Confidentiality Agreement Template will provide:

  • An easy to follow template
  • Definitions of what is considered “confidential information”
  • Tips on how to customize your confidentiality

The Importance of a Confidentiality Agreement

A confidentiality agreement protects individuals or businesses to protect sensitive information. A confidentiality agreement is essential because it prohibits a receiving party from turning over confidential information that could be exposed to a competitor in a similar industry. Examples of sensitive information include:

  • Consumer Information, Prospective Clients and Client List
  • Operation Software
  • Trade Secrets
  • Intellectual Property
  • Marketing Plans, Business Plans, and Proposals
  • Financial Information
  • Company Operations and Business Information
  • Product Information
  • Service Data

Other names for confidentiality agreements include:

  • Non-Disclosure Agreement (NDA)
  • Mutual Non-Disclosure Agreement (MDA)
  • Confidential Disclosure Agreement (CDA)
  • Proprietary Information Agreement (PIA)
  • Secrecy Agreement (SA)

This type of agreement creates a confidential relationship between the two parties. Sometimes a contract will include a confidentiality clause. Such provision effectively protects confidential materials. In other situations, a business or individual may require a separate, more detailed confidentiality agreement.

When is a Confidentiality Agreement Necessary?

Confidentiality agreements are used in several different industries and for a wide variety of purposes. Basically, the agreement prevents the receiving party’s disclosure of confidential information. There are two types of confidentiality agreements: unilateral and mutual confidentiality agreements.

So, when is a confidentiality agreement necessary? Here are a few common uses of a confidentiality agreement:

  • Employer and Employee – A confidentiality agreement in an employment relationship prohibits the employee from revealing a company’s proprietary and protected information. The confidentiality agreement is not only effective throughout the individual’s employment, but it remains effective once the employment relationship has ended. Generally, a confidentiality agreement stays effective one to three years after the employee departs from the company. In some situations, the confidentiality does not expire depending on the industry and secret information disclosed throughout the course of employment.

An employer may require an employee to sign a non-compete agreement. A non-compete agreement restricts an employee from working with a competing company in a similar industry for a defined period of time. The non-compete could also limit the geographical region to where the individual is prevented from working for a competitor.

  • Independent Contractors – Companies hire independent contractors or freelancers for various tasks. An independent contractor may consult with a company on marketing strategies, web design, and other projects.
  • Lenders and Investors – An entrepreneur or business partners may require a loan to start up their company. A lender may be required to sign a confidentiality agreement to protect the joint venture’s business model and proposals.
  • Inventors and Developers – If an inventor is interested in the licensing or sale of their product, design, or technology, it is crucial to protect their technology.

There are several situations where a confidentiality agreement may be necessary. Confidentiality agreements are legally binding documents and offer legal protection to the disclosing party. Should the receiving party divulge protected and privileged information, the disclosing party may seek legal action.

What are the Essential Elements of a Confidentiality Agreement? 

The goal of any contract is to ensure the agreement is valid and enforceable. Here are a few components typically found in a general confidentiality agreement:

  • The Parties – All parties subject to the confidentiality agreement should be identified as the “disclosing party” and the “receiving party.” It is also helpful to include their complete contact information on the agreement as well.
  • The Definition of Confidential Information – Depending on the industry and specifics of the secret information to be protected, a clear definition should be included in the agreement.
  • The Receiving Party’s Obligations – The receiving party should understand and agree that they are not permitted to disclose confidential information for their own benefit or the benefit of any third-party.
  • Term – Depending on the industry and weight of the private information, a company may require the receiving party to be bound by confidentiality for a certain amount of years, which should be listed in the confidentiality agreement.
  • What is Considered Confidential Information and What is Not – The agreement should define what is and what is not considered confidential information.
  • Signatures – The document must be signed by all parties subject to the agreement.

Common Mistakes in Confidentiality Agreements 

A confidentiality agreement may not be enforceable if its terms are too broad or if the secret or if the information listed in the agreement is already public knowledge. It is important to seek legal advice when drafting a confidentiality agreement. Each state may have different requirements for what is considered enforceable and valid.

Preview Of Contract:

<iframe src="" scrolling="no" frameborder="0" allowfullscreen=true width="800" height="520" ></iframe>