How to Write a Non-Disclosure Agreement

A non-disclosure agreement (NDA) is a contract in which the signer agrees not to disclose another party's proprietary or confidential information, to which they might become privy during a working relationship with that party. Whether you're a large corporation, a contractor or a consultant, a non-disclosure agreement can help you protect your professional reputation, intellectual property and confidential information.

Difficulty: Moderately Challenging

Instructions

1. Decide if the agreement will be a mutual non-disclosure agreement. Mutual, or "two-way", non-disclosure agreements confirm that both parties, such as a client and contractor, don't disclose one another's confidential information, as outlined in the agreement.

2. Determine the worst case scenario and tailor your non-disclosure agreement to prevent it. For example, you're associated with an IT company that trains contractors to use your proprietary software and you want to prevent the disclosure of your software code to competitors. Another example is a contractor who's hired a financial consultant and who wants to ensure that your financial information is kept private.

3. Consult a lawyer. To protect yourself and your intellectual property or confidential information, consult with a lawyer to see if they can draft a non-disclosure agreement that suits your unique business needs. If you don't think you can afford this service, consider the fact that it will likely be a one-time fee you can write off as a business expense and it can also save you time and potential legal fees down the road.

4. Purchase a non-disclosure agreement template online. Several Web sites offer downloadable contract templates for a fee. You can also find a pre-made non-disclosure agreement online and customize it for your business needs; however, you'll probably need to tweak a lot more than just the company names.

5. Ensure that the NDA clearly explains the definition of the confidential information it refers to, the obligations of the signer(s), the start date the agreement goes into effect and the recourse if the terms of the agreement are breached.

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