May 30, 2022
Full disclosure on what a non disclosure agreement really is
Many of us will have heard the term non disclosure agreement. They have gained a fair bit of notoriety in recent years due to celebrities using them if they do not want any untoward information regarding them leaking out from employees. That’s not the only situation they are used in however and they are far more common than you would otherwise think. They are also far more necessary than you would think as well. Here, we look at why a non-disclosure agreement is such a key piece of documentation for many and any company.
What is a non disclosure agreement?
A non disclosure agreement is a contract between two parties where one party agrees not to divulge confidential information about the other party. That confidential information can take many forms. Be it an insider secret pertaining to a company’s patent on an invention, sensitive financial information or, indeed, the illicit goings-on of a celebrity who otherwise has a squeaky clean image. Confidential information is protected as, if it is found to be leaked by a person, there can be legal ramifications for them.
The advantages of a non disclosure agreement are not to be dismissed. All companies will have some form of insider information that helps maintain their competitive edge. Even if that information is something that will destroy the reputation of an innocent-looking pop band.
Difference between mutual and unilateral NDA
There are several types of NDA which depend on the circumstances or situation that an NDA is required. Ie. a Patent NDA vs a financial information NDA. Such NDAs tend to be obvious in what they are pertaining to. However, a mutual NDA and a unilateral NDA are not quite so clear on what they are from the outset. Plus, the difference between them is quite stark so that they have distinct times when one should be used over the other.
A mutual non disclosure agreement is when both parties agree not to reveal the other party’s confidential information. In being so, a mutual NDA is a two-way or reciprocal form of this type of agreement. It can sometimes be referred to as a bilateral NDA.
In comparison, a unilateral non disclosure agreement is when only one party agrees to keep confidential information a secret. That confidential information will belong to the other party.
Choosing between these two types of non disclosure agreements will be decided upon by looking at the situation as a whole. Largely, it will be clear when a mutual agreement is needed versus a unilateral agreement. A unilateral agreement is used when only one party has information to protect. A mutual agreement is when both parties need some form of information protected.
Free template: Download our free NDA template
So now you think you need a non disclosure agreement, how do you go about creating one? At Contractbook, we have a free template to download for an NDA in our extensive template library already. It is one of the most efficient and effective ways that you can create a non disclosure agreement. It already includes all the elements a non disclosure agreement requires. That’s great news as it means that creating a non disclosure agreement is no longer an administrative burden, so that you can just enjoy the benefits that they provide.
How to create, automate and sign a non disclosure agreement
Using our template is one of the easiest ways to create a non disclosure agreement. In fact, we have two types of non disclosure agreements in our library. We have a one-way - or unilateral agreement - and a mutual non disclosure agreement. Using either of them to create a non disclosure agreement is a breeze as the empty fields simply have to be updated with the relevant information about the parties involved. That’s all that is needed to execute an NDA and for it to be legally binding as our templates are created by lawyers to ensure that they are enforceable.
And, what’s great about our free template is that you can then use our software as a whole to then automate your entire non disclosure agreement process. Non disclosure agreements are a type of documentation that many companies may need to have several parties sign individually. Any company that has confidential information with employees will likely benefit from each employee signing a non disclosure agreement. It will help protect against any leaking of sensitive data.
Yet, not all companies do this as the administrative burden of creating and signing contracts is sometimes too much for a company to take on. Automating non disclosure agreements with our software is therefore a win-win situation. Your administrative burden is all but eradicated, while your company-specific information is far far safer.
Plus signing these agreements is a very straightforward exercise with our technology too. Doing so electronically is quick and painless - and requires no trees to be hurt in the process. Our date and time stamps make our e-signatures even more secure than pen and ink, plus, when all the signatures are collected, the non disclosure agreement can be saved to cloud storage where it is easily found. The data within the agreement can go on to be used if required in the future. Paper copies of non disclosure agreements, and even dreaded PDFs, cannot offer these benefits.
Like all contacts, non disclosure agreements can become a true asset to a firm. The reason being is that it provides a level of protection that can save a company from having their secrets revealed. And, when used in conjunction with a time-saving piece of software like ours, there really is no reason not to have non disclosure agreements as a common piece of documentation in a company.