A non-disclosure agreement (NDA) is a contract that keeps shared information secret. Before you show a contractor your source code, pitch a partner your business plan, or open your books to a buyer, an NDA makes the recipient legally responsible for keeping that information confidential and using it only for the agreed purpose.
This template generates both common forms: a unilateral NDA when only one side discloses, and a mutual NDA when both sides will exchange sensitive information.
Unilateral or mutual: which NDA do you need?
Choose based on the direction of the information flow, not on who is bigger or who drafted the document. If you are hiring a freelancer and only your information is at stake, a unilateral NDA is enough and simpler to negotiate. If two companies are exploring a partnership, merger, or joint project where both will open up, a mutual NDA treats both sides identically and is usually accepted faster.
| Situation | Recommended NDA |
|---|---|
| Hiring a contractor or freelancer | Unilateral |
| Showing a product to a potential customer | Unilateral |
| Partnership or joint venture talks | Mutual |
| Merger or acquisition discussions | Mutual |
| Both teams sharing technical data | Mutual |
What an NDA can and cannot protect
An NDA protects non-public business information: customer lists, pricing, financials, product plans, code, and know-how. It cannot lock up information that is already public, that the recipient already knew, or that they develop independently. Those standard exclusions are in every enforceable NDA, including this one; removing them makes the agreement more vulnerable in court, not stronger.
NDAs cannot silence everything
Federal and state laws limit NDAs: they cannot block whistleblower reports to government agencies, and many states restrict confidentiality clauses covering unlawful workplace conduct. Use an NDA for business secrets, not as a general gag clause.
How long should confidentiality last?
Two to five years is the standard range for ordinary business information; one year can be fine for fast-moving fields like software, while sensitive financial or technical data often justifies five. Trade secrets are the exception: they stay protected for as long as they remain secret, and this template says so explicitly. Avoid writing 'perpetual' obligations for ordinary information, as some courts read unlimited terms as unreasonable.
Frequently asked questions
Is an NDA legally enforceable?
Yes. A properly drafted NDA is a binding contract in every state. Courts enforce them regularly, provided the scope is reasonable, the information is genuinely confidential, and standard exclusions are present.
What happens if someone breaks an NDA?
The disclosing party can sue for damages and, because leaks are hard to undo, seek an injunction ordering the recipient to stop using or spreading the information. This template includes the injunctive relief clause that makes that remedy available.
Does an NDA need to be notarized or witnessed?
No. The signatures of the parties are enough in every state. Keep a signed copy on each side.
Can I use one NDA with several people?
Sign a separate copy with each person or company. Each recipient must be individually bound; one document signed by one recipient does not cover the others.
Should the NDA be signed before or after I share information?
Before, always. An NDA generally does not protect information disclosed before it takes effect unless it explicitly says so, and negotiating confidentiality after the secret is out has little leverage.