Confidentiality Agreements

Written by Kathleen Gagne
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Confidentiality agreements can be used in several circumstances, one of which may occur when a company or individual is in the process of developing a new product or improving existing technology. They are designed to protect a specific set of information that must be shared by two or more parties in order for them to act as partners at any level. Use of these forms can also protect and prevent the forfeiture of patent rights.

Confidentiality Agreements and Proprietary Information

The information that may not be disclosed under confidentiality agreements must be specifically delineated in the agreement and is called proprietary information. Almost any kind of information may be included as proprietary, and the limits of disclosure must be clearly defined and agreed on by both parties. When the issue is technical information, such items as engineering drawings, prototype data, software, tools, and specifications and more can be included.

If any information pertaining to the confidentiality issue can be disclosed, that information must also be clearly defined. A key element in a confidentiality agreement is a time frame. The signers must agree on how long the information must be held confidential and any circumstances under which that time can be extended or reduced.

Because of the risk involved with exchanging information in some circumstances, the terms and conditions of confidentiality agreements must be crystal clear with no room for ambiguous interpretation. If you are considering the use of a standard agreement, you can certainly find one online. Be absolutely certain that any confidentiality agreement template you purchase contains all the elements necessary for it to be legally valid in your state.


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