Louisiana companies may often find themselves in need of sharing what could be deemed confidential business information. It is reasonable for owners and executives to be concerned about protecting such information and in these situations a non-disclosure agreement may be the way to go.
As explained by Entrepreneur magazine, a non-disclosure agreement is also called a confidentiality agreement. As the name implies, this special type of contract outlines parameters for what may be identified as confidential data and what another party must keep confidential. Some situations in which an NDA may be important or required include during talks with prospective partners, buyers or licensees. In any of these situations, a company would naturally have to share sensitive materials and facts with another party.
It is also possible that a confidentiality agreement should be used with a company’s own employees as these people commonly have access to privileged company information. Third-party vendors who are hired for certain services may also be asked to sign NDAs.
Forbes adds that a non-disclosure agreement should clearly spell out what is the confidential information and how it should be protected. For example, some contracts may indicate that only information shared in writing must be protected or falls within the scope of the contract. In addition to maintaining secrecy, an NDA may be used to stipulate that another party cannot use confidential data to their advantage. A contract may also outline the process by which any conflict that may arise between the two parties should be addressed.