About Non-Disclosure Agreement
A Non-Disclosure Agreement (NDA), also known as a confidentiality agreement, 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.
An NDA creates a confidential relationship between the parties, typically to protect any type of confidential and proprietary information or trade secrets. Furthermore, an NDA protects non-public business information. Like all contracts, they cannot be enforced if the contracted activities are felonies.
NDAs are commonly signed when two companies, individuals, or other entities, are considering doing business and need to understand the processes used in each other's business for the purpose of evaluating the potential business relationship. NDAs can be mutual or they can restrict the use of material by a single party.
An employee can be required to sign an NDA or NDA-like agreement with an employer, protecting trade secrets. In fact, some employment agreements include a clause restricting employees' use and dissemination of company-owned confidential information.
In legal disputes resolved by settlement, the parties often sign a confidentiality agreement relating to the terms of the settlement.