A Confidentiality Agreement also known as a Non-Disclosure Agreement (NDA) is a legal contract that outlines how confidential information will be shared, protected, and restricted between parties. It’s used to safeguard sensitive information from being disclosed to unauthorized third parties.
Below are the essential components typically found in a Director’s Service Contract:
Disclosing party: the one sharing the information.
Receiving party the one receiving and agreeing to protect it.
It can be unilateral, bilateral, or mutual (if both parties share confidential information).
• A clear and specific definition of what is considered confidential.
May include:
. Business plans
. Financial information
. Trade secrets
. Client lists
. Product designs
. Technical data
• Explain why the confidential information is being shared.
o for investment review, partnership discussions, employee onboarding, etc.
How the information should be handled:
• Maintain confidentiality.
• Use only for the agreed purpose.
• Limit access to authorised personnel.
• Take reasonable steps to protect the data.
What information is not protected:
• Publicly known or becomes public (not through breach).
• Already known by the receiving party before disclosure.
• Independently developed without reference to confidential info.
• Required to be disclosed by law (with prior notice, if possible).
• Duration the agreement remains in force (e.g., 1, 3, or 5 years).
• Duration confidentiality must be maintained (sometimes survives indefinitely for trade secrets)
• Obligations to return, delete, or destroy confidential materials after use or upon request.
• Legal remedies in case of a breach (e.g., injunction, damages).
• Possibility of covering attorney fees or specific penalties.
• Which countries laws apply in case of a dispute.
• Legal names, signatures, and dates for all parties involved.
A Confidentiality Agreement: