A Guide to Our Reciprocal Non Disclosure Agreement

by Kate Mccormick - Solicitor

Our guide to reciprocal non disclosure agreement provides you with full instructions on how to fill out our document and will inform if you need any additional information for this purpose.

A Guide to Our Reciprocal Non Disclosure Agreement

This Reciprocal Non Disclosure Agreement is for use to impose obligations on both parties for the use of confidential information that they will each be disclosing to the other in the course of their business relationship.

Clauses in this Reciprocal Non Disclosure Agreement

Cover page - you will need to insert the names of both parties to the Agreement here.

Between – this clause defines the parties to the Agreement. You need to insert the details of both parties here including their business/company name and registered number (if either party is a registered company) and registered office or trading address.

Definitions and Interpretation – this clause defines the main terms used in the Agreement.

Purpose and Use of Disclosed Information – you will need to carefully define the Confidential Information that is being disclosed, in clause 2.1. Alternatively, you can include a Schedule for this purpose and refer to the ‘attached Schedule’. In clause 2.2 you need to list the purposes for which each party may use the Confidential Information disclosed to them. Again, you may wish to attach a Schedule for this purpose. The information that you provide in these clauses is key to the Agreement. You should include all information that is to be protected but not make the definition so broad that it is unreasonable and/or unenforceable. You should also not include information that is not actually confidential, for example because it is too trivial or has already been made public in some way or because it can be obtained from somewhere else. (You can refer to clause 4 in this regard and state ‘except for any information covered by clause 4’). One option is to mark any information is to be protected as ‘confidential’ and then use this as the basis of the definition in clause 2.1.

Obligations – this clause creates an absolute obligation on the each party to keep the Confidential Information disclosed to them safe and not to disclose it to any third party other than in accordance with the terms of the Agreement. You could make this less strict by requiring each party to take all reasonable steps to protect the information but this will depend on the degree of sensitivity of the information to be disclosed.

Non Confidential – this clause explains when information will not be considered to be confidential, in law or by written agreement between the parties, and so will not be protected by the Agreement.

Permitted Third Party Disclosure – this clause enables limited disclosures of the Confidential Information by each party, where it is necessary to achieve the Permitted Purpose.

Copies – the purpose of this clause is to try to ensure that the parties remain in control of the Confidential Information disclosed to them and do not reproduce it any more than is necessary.

Forced Disclosure – this clause permits each party to make disclosures of the Confidential Information that they are required to by law or by a Government body. The party disclosing the Information must warn the other party of this in advance and certify that the disclosure is necessary.

Warranty – the aim of this clause is to prevent either party from disclosing Confidential Information to the other that they do not have the right to disclose, for the protection of the recipient party.

Announcements – this clause is mutual obligation on both parties not to reveal details about the Agreement without the other’s prior written consent.

Indemnity – if either party breaches the terms of the Agreement, this clause enables the other to claim full reimbursement of any foreseeable loss, costs and expenses that they experience as a result of the other party’s breach.

Assignment - this clause prevents either party from assigning their rights under the Agreement to a third party, other than to their subsequent owners, without the consent of the other party. This is a standard provision.

Third Party Rights - this clause excludes the Contracts (Rights of Third Parties) Act 1999 from applying to the Agreement so that only the parties to the Agreement can enforce it.

Variation – this clause ensures that the Agreement is not varied unintentionally or otherwise by informal or oral statements or acts. It provides certainty and ensures that the provisions can be relied on exactly as they are set out in the Agreement, unless the correct procedure has been followed for amending them.

Governing Law and Jurisdiction - if either party is based abroad, you may wish to change the jurisdiction clause to reflect this and/or make it non-exclusive. Where the parties based in the UK, the jurisdiction should be exclusively that of England and Wales.

Signature clause – this clause makes the Agreement enforceable. You need to insert the names of both parties and the officers signing on their behalf. Both parties need to sign the Agreement here. Once both parties have signed the Agreement, it should be dated on the Cover Page and also at the top of Page 1. This is the date that the Agreement will commence. Both parties should keep a copy of the signed Agreement.