All About NDAs (And Why Your Business Needs Them!)

September 12, 2024  |  Carole Clark Isakson

This blog focuses on the many times your business will need an NDA—and why printing one from the internet might not accomplish what you need.

A Non-Disclosure Agreement (NDA) is a binding document that restricts one party or multiple parties from disclosing certain information that is to be shared. Key points:

1. An NDA can be in favor of only one party or cover all of them. Don’t assume the NDA that is presented to you covers your information unless it specifically says it does.
2. The NDA should state its purpose. If there is a question later about how to interpret the document, knowing why the parties entered into it in the first place will help.
3. The document will include a definition of “Confidential Information” which may need to be revised to reflect your specific data.  
4. The NDA will state how the Confidential Information can be used and by whom. Pay attention to this section, and make sure that the other party is responsible if its representatives wrongfully disclose or use your information.
5. A common provision in more current NDA forms will provide for the destruction of the information under certain circumstances. Your attorney will ensure this is correctly drafted to protect your information and address the fact that electronic records may live forever.

A well-crafted NDA is the basis for a successful business transaction. You may need an NDA for:

• The sale or purchase of a business.
• The hiring of outside consultants for your business.
• The sharing of information with third party vendors or suppliers.
• The sharing of information with candidates for high-level positions at your company.

As a rule, don’t share confidential information with a third party unless an NDA is in place. Connect with the corporate team at Barna, Guzy & Steffen for more information and assistance in this area.