The simplest provision is generally appropriate when an NOA is admitted with an individual such as an independent contractor. Use the most detailed if your secrets can be used by more than one person within a company. The detailed provision stipulates that the recipient party must restrict access to persons within the company who are also bound by this agreement. You cannot prohibit the receiving party from disclosing information that is known to the public, that was legally acquired from another source or developed by the receiving party before they meet you. Similarly, it is not illegal for the receiving party to reveal your secret with your permission. These legal exceptions exist with or without agreement, but they are usually contained in a contract in order to make everyone understand that this information is not considered a trade secret. Although standard form NDAs are commonly used, parties should always check whether the agreement is consistent with the particular circumstances and risks. As with all contractual laws, when developing or negotiating an NDA, you remember that seemingly harmless changes can sometimes have unintended consequences (see for example, this blog post on “Time is the essence” clauses and what they actually mean). The period is often a matter of negotiation. You, as a revealing party, generally want an open period without borders; recipients want a short period of time. With respect to personnel and subcontracts, the term is often unlimited or ends only when trade secrecy is made public.
Five years is a common term in confidentiality agreements that involve trade and product negotiations, although many companies insist on two or three years. NDAs are quite common in many business environments because they offer one of the safest ways to protect trade secrets and other confidential information that must be kept secret. Information often protected by NDAs may include order patterns for a new product, customer information, sales and marketing plans, or an unequivocal manufacturing process. The use of a confidentiality agreement means that your secrets remain in hiding, and if not, you have remedies and perhaps even sue for damages. You give your information to the “recipient,” but what if the recipient is really a company? Or what happens if the recipient has to execute certain information from his lawyer? This type of problem is addressed under the heading “Restricted Use of Confidential Information.” Think about who needs to know the information and limit the use of information to these people. The recipient must ensure that this person also signs an NDA that accepts the same conditions.