Template Non-Disclosure Agreement

Non-Disclosure Agreement (NDA)

Before you share information about your business idea with prospective investors, partners, employees, advisors, and other players, you may want to have them sign a non-disclosure agreement (also known as a confidentiality agreement). An NDA states that the other party may not share your confidential information with anyone else for a specified period of time. This works to protect you from potential copycats. Need an example to reference? Refer to the Wicked Start Non-Disclosure Agreement Example, which can be found in the Example area of Sections 4.08 & 6.07. NDA Example.doc

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Non-Disclosure Agreement
[YOUR COMPANY NAME]
NON-DISCLOSURE AGREEMENT W/[Third Party Company/Individual Name]

THIS CONFIDENTIALITY AND NON-DISCLOSURE AGREEMENT (this Agreement) is made and entered into this Day (day), Month (month) and of Year, (year), by and between [Third Party Company/Individual Name], a [Type of Company] ([Third Party Company/Individual Name]), and [Your Company Name], a [Type of Company] company organized under the laws of the State of [State of Incorporation], whose address is [Your Company Address] (COMPANY). WHEREAS, [Third Party Company/Individual Name] and COMPANY have expressed an interest in a possible business relationship or transaction (together, the Proposed Transaction). WHEREAS, COMPANY requires certain confidential and proprietary information relating to the business of [Third Party Company/Individual Name] for the purpose of considering the viability of the Proposed Transaction; and WHEREAS, in consideration for the agreement of COMPANY to (a) keep such information confidential, (b) not disclose that fact the fact that [Third Party Company/Individual Name] or its shareholders may consider the Proposed Transaction, (c) not disclose that the COMPANY is in contact with or is having discussions with [Third Party Company/Individual Name] and (c) keep all other covenants of the COMPANY set forth in this agreement, [Third Party Company/Individual Name] is willing to provide such information to COMPANY; and WHEREAS, COMPANY acknowledges (1) the need to protect the confidentiality of such information, (2) the fact that the information is proprietary, (3) that this Agreement does not grant any license to COMPANY to use any of the information except for the purpose expressly provided herein, and (4) that it may not disclose the fact that [Third Party Company/Individual Name] or its shareholders may consider the sale of [Third Party Company/Individual Name] or its assets or business or the fact that the COMPANY is in contact with or is having discussions with [Third Party Company/Individual Name]; NOW, THEREFORE, in consideration of the foregoing, the parties hereby agree as follows: 1. The statements made in the third and fourth paragraphs of the preambles at the beginning of this Agreement are agreements and covenants of the COMPANY. As used in this Agreement, the term Confidential Information shall mean with respect to [Third Party Company/Individual Name], any and all data and information (whether oral or written) including without limitation, all financial statements and information, corporate records and minutes, cost and expense data, production data, marketing data, technology, employment and employee information, projections of results, and all other information obtained from the books, records and properties of [Third Party Company/Individual Name], and including marketing and customer

2.

[Name of Your Company]

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data information, disclosed by [Third Party Company/Individual Name] to COMPANY or its affiliates, directors, officers, employees, agents, advisors and/or other representatives of any party (herein collectively referred to as Representatives) pursuant to this Agreement. [Third Party Company/Individual Name] is not obligated hereunder to disclose any of its Confidential Information to COMPANY. The term Confidential Information does not include information which (i) is or becomes generally available to the public other than as a result of a disclosure by COMPANY or its Representatives in breach of this Agreement, (ii) was available to COMPANY prior to the disclosure of the Confidential Information to COMPANY by [Third Party Company/Individual Name], (iii) becomes available to COMPANY from a source other than [Third Party Company/Individual Name], provided that such source is not bound by a confidentiality agreement with [Third Party Company/Individual Name] of which COMPANY is aware; or (iv) is information independently developed by COMPANY without reference to the Confidential Information. 3. COMPANY may use the Confidential Information only for the limited purpose of evaluating the Proposed Transaction. COMPANY shall receive and maintain all of the Confidential Information in the strictest confidence. COMPANY shall not disclose, publish or disseminate, and shall prevent its Representatives from disclosing, publishing, or disseminating, the Confidential Information, except as specifically permitted by the terms of this Agreement. Except as may be expressly authorized in writing by [Third Party Company/Individual Name], Company shall not duplicate, reproduce, transcribe, re-write or in any other way or manner copy any of the Confidential Information (Reproduction). Disclosure by COMPANY hereto of the Confidential Information may be made only to Representatives of COMPANY who (i) are directly involved in the evaluation of the Proposed Transaction and (ii) have a specific need to know such information. COMPANY agrees to diligently monitor each such person to ensure such persons compliance with the terms of this Agreement. COMPANY shall advise each such Representative of the existence and terms of this Agreement and direct them to abide by the provisions hereof. COMPANY shall be responsible for any disclosure of Confidential Information by a Representative that would constitute a breach of this Agreement if made by COMPANY. COMPANY shall use at least the same degree (but no less than a reasonable degree) of care and protection to prevent the unauthorized use, dissemination or copying of any Confidential Information of [Third Party Company/Individual Name] as COMPANY uses to protect its own confidential information. COMPANY shall immediately notify [Third Party Company/Individual Name] in the event of any loss or unauthorized disclosure of any Confidential Information COMPANY agrees that nothing contained in this Agreement shall be construed as granting any property rights, by license or otherwise, to any Confidential Information of [Third Party Company/Individual Name] disclosed pursuant to this Agreement, or to any invention or any patent, copyright, trademark, or other intellectual property right of [Third Party Company/Individual Name] embodied by such Confidential Information. COMPANY shall not make, use or sell for any purpose any product or other item or service using, incorporating or derived from any Confidential Information.

4. Without the prior written consent of [Third Party Company/Individual Name], except as required
by law (such requirement to be confirmed by a written legal opinion of counsel reasonably acceptable to [Third Party Company/Individual Name] and addressed to [Third Party Company/Individual Name], at COMPANY's expense), COMPANY and its Representatives will [Name of Your Company] Page 4

not disclose to any person, firm or corporation the fact that the Confidential Information has been made available, that discussions or negotiations are taking place or have taken place concerning the Proposed Transaction, or any of the terms, conditions or other facts with respect to any such Proposed Transaction, including the status thereof. COMPANY expressly acknowledges that the disclosure to third parties of the fact or existence of the discussions between COMPANY and [Third Party Company/Individual Name] could have a material adverse effect on the business and business relationships of [Third Party Company/Individual Name].

5. During the term of any discussions between the parties and for a period of three years thereafter,
COMPANY shall not, directly or indirectly, individually or by action in concert with others, (a) induce or influence or seek to induce or influence any person who is engaged as an employee to terminate his or her employment by [Third Party Company/Individual Name].

6. Upon the written request of [Third Party Company/Individual Name], COMPANY shall (a) deliver
or destroy (such delivery or destruction shall be at COMPANY's option), all tangible materials containing or embodying the Confidential Information, including all copies and other Reproductions thereof, (b) destroy any other writings, notes, materials or other data from which all or any portion of the Confidential Information would be discovered, discerned or recalled, and (c) provide [Third Party Company/Individual Name] with a certificate from COMPANY certifying that its obligations set forth in this paragraph have been completely fulfilled and satisfied.

7. Each party hereby acknowledges and agrees that in the event of any breach of this Agreement by
COMPANY, including, without limitation, the actual or threatened disclosure of the Confidential Information without the express prior written consent of [Third Party Company/Individual Name] or as otherwise permitted hereunder, [Third Party Company/Individual Name] will suffer irreparable harm and injury and no remedy at law will afford it adequate protection against, or appropriate compensation for such injury. Accordingly, each party hereby agrees that in any such event [Third Party Company/Individual Name] shall be entitled to seek specific performance of COMPANY's obligations under this Agreement, as well as such further injunctive relief as may be granted by a court of competent jurisdiction. Nothing herein shall be construed as prohibiting [Third Party Company/Individual Name] from pursuing any other remedies available to it for any such breach or threatened breach, including recovery of damages. 8. By entering into this Agreement, neither party has any obligation, expressed or implied, to enter into the Proposed Transaction. 9. This Agreement is effective when fully executed and effective against COMPANY as of the date it first acquired knowledge of Confidential Information. COMPANY's obligations under this Agreement shall expire on the earlier of (a) the consummation of the Proposed Transaction or (b) three (3) years from and after the date hereof.

10. Notwithstanding anything herein to the contrary, in the event that COMPANY or any of its
Representatives becomes legally compelled (by deposition, interrogatory, request for documents, subpoena, civil investigative demand or similar process) to disclose any of the Confidential Information, COMPANY shall provide [Third Party Company/Individual Name] with prompt written notice of such requirement so that [Third Party Company/Individual Name] may seek a protective order or other appropriate remedy or waive compliance with the terms of this Agreement.

[Name of Your Company]

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In the event that such protective order or other remedy is not obtained, or [Third Party Company/Individual Name] waives compliance with the provisions hereof, COMPANY agrees to furnish (and cause its Representatives to furnish) only that portion of the Confidential Information which it is advised by written opinion of counsel is required to be disclosed and to exercise its reasonable efforts to obtain assurance that confidential treatment will be accorded such Confidential Information. 11. This Agreement and the rights and obligations of the parties under this Agreement may be assigned only upon the prior written approval of the parties hereto. Subject to the foregoing, the rights and obligations of the parties hereto will inure to the benefit of, will be binding upon, and will be enforceable by the parties hereto and their permitted successors and assigns.

12. No failure or delay by [Third Party Company/Individual Name] in exercising any right, power, or
privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or privilege preclude any other or further exercise thereof. 13. No modifications of this Agreement or waiver of any of its terms will be effective unless set forth in writing signed by the party against whom it is sought to be enforced.

14. This Agreement shall be governed by and construed in accordance with the laws of the State of
[State of Incorporation]. Any disputes under this Agreement shall be brought exclusively in the state or Federal courts, as appropriate, located in [State where business is located], and the parties hereby irrevocably consent to the personal jurisdiction and venue of these courts. If any litigation, proceeding or arbitration is commenced to enforce any provision of this Agreement or to seek a declaration of the rights of the parties hereunder or as a result of any breach or threatened breach of any provision of this Agreement, the prevailing party shall be entitled to recover from the non-prevailing party all of its costs and expenses incurred in connection with such litigation, proceedings or arbitration, including without limitation reasonable attorneys' fees. 15. All notices permitted or required under this Agreement shall be in writing and shall be delivered by personal delivery, electronic mail, facsimile transmission or by certified or registered mail, return receipt requested, and shall be deemed given upon personal delivery, five (5) days after deposit in the mail, or upon acknowledgement of receipt of electronic transmission. Notices shall be sent to the addresses set forth at the beginning of this Agreement or such other address as either party may specify in writing using the notice procedures set forth herein. IN WITNESS WHEREOF, the parties hereby execute this Agreement as of the date and year first written above. [Third Party Company/Individual Name] Signature: _______________ Name: [Name of Primary Signatory] Title: [Title of Primary Signatory] [Your Company Name] Signature: _______________ Name: [Name of Primary Signatory] Title: [Title of Primary Signatory]

[Name of Your Company]

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