An NDA can either broadly state the information that is confidential, e.g. business plans, client lists, trade secrets, etc., or write the specific details that are not to be shared.

Sample Mutual NDA

When Apple and Gorilla Glass partnered to make iPhones together, both had protections in their NDA to protect their proprietary information. Apple even went as far as to include a $50 million penalty if Gorilla Glass decided to break the agreement.

Most NDA’s have an expiration period or a statement disclosing that “if any of the confidential information in this agreement becomes widely known, through other sources or by the party themselves, that the agreement is no longer valid.”

With a mutual NDA, this may not be applicable if both parties are agreeing to keep the same information confidential. In this case, the parties will both be required to most likely keep the details and information secret until the end of the NDA.

An NDA has two (2) options for consequences to write in the event of a breach by any of the parties:

1. Broad Language (“Equitable Relief”) – The parties may choose to use broad language such as “the breaching party will be responsible for equitable relief for any damages and/or loss of business that occurred due to said breach.” This would allow the party non-breaching party to allow the court to come up with the total amount owed by the breaching party. In most cases, the NDA will also contain language stating party that breached the contract will be responsible for attorneys’ fees for both parties.
2. Specific Language – The parties may also use specific language in the event of a breach by any of the parties. Under this scenario, there should be a specific amount stated (such as one million dollars ($1,000,000)) if a breach is made by either party. The issue with this route is if for any reason the trade secret becomes more valuable than the penalty, one (1) of the parties would find it’s in their best interest to reveal the trade secrets to outside sources.

In most cases, it will not matter which type of consequence is chosen. What matters is that if there is a breach that the party that was inflicted damages will be compensated by the other party.