There are times when a business or corporation must keep trade secrets and other confidential information secure even while not necessarily ever doing business with whom they are considering. Without a Confidentiality Agreement or some sort of Non-Disclosure Agreement, it is hard to begin discussions with future business partners or vendors. Any Confidentiality Agreement or NDA should define Confidential Information and also define what is not Confidential Information.
However, you also want to make sure you restrict the recipient of your confidential information from benefiting from the direct or indirect use or exposure you give them to the Confidential Information. This allows you to not only sue for the breach of the agreement if necessary, but also to allege that any benefit obtained by the recipient through use of your Proprietary and Confidential Information should be turned over to you for the benefit of your business or company.
The first two provisions below are the typical provisions in a Confidentiality Agreement. However, make sure the Non-Circumvention provision below is part of your NDA or Confidentiality Agreement.
As used herein, “Confidential Information” shall mean all information, whether in written, oral, electronic or other form, furnished or disclosed on or after the date hereof by the Company to the Recipient, and specifically includes, but is not limited to, all business and financial information, assets, marketing and strategic plans, analysis, projections, reports, technologies, processes and operations, compilations, forecasts, studies, lists, summaries, notes, data, legal and regulatory permitting strategic analysis and plans relative to state and local law, all terms and conditions included in any and all drafts of any agreement with respect to the Business Opportunity, all customers, employees, suppliers, vendors, professionals involved with the Business Opportunity (“Contact Persons”), and all other documents and materials concerning the Company and its affiliates, including the terms of this Agreement, and any prices, fees, financing arrangements, and schedules hereto. Confidential Information shall also include all information related to the Business Opportunity provided by the Company to the Recipient prior to the signing of this Agreement.
Confidential Information shall not include any of the following:
(a) such information in the public domain at the time of the disclosure, or which subsequently comes within the public domain through no fault of the Recipient;
(b) such information which was in the possession of the Recipient at the time of disclosure that was not acquired, directly or indirectly, from the Company;
(c) such information which the Recipient acquired from a third party who did not require the Recipient to hold the same in confidence and who did not acquire such information through breach of this Agreement; or
d) Information independently developed by the Recipient without use of any Confidential Information.
The Recipient shall not at any time prior to the expiration of three (3) years from the date of this Agreement, without the prior written consent of the Company, which consent the Company may withhold in its sole discretion, (a) attempt in any manner to deal directly or indirectly in any manner with any of the Contact Persons or other individuals or companies related to the Business Opportunity including by having any part of or deriving any benefit from the Business Opportunity or any aspect thereof, or (b) by-pass, compete, avoid, circumvent, or attempt to circumvent the Company relative to Business Opportunity including by utilizing any of the Confidential Information or by otherwise exploiting or deriving any benefit from the Confidential Information.