Non-Disclosure Agreement (NDA)

In one sentence

A standalone contract in which one or both parties promise to keep shared information confidential.

Plain English

An NDA is a formal agreement—often signed before business discussions—in which parties commit to keeping each other's confidential information secret. NDAs can be one-way (only one party shares secrets) or mutual (both parties protect each other's information). They typically define what counts as confidential, how long the obligation lasts, and what exceptions exist (like information that's already public). NDAs are common before mergers, partnerships, job interviews, or any situation where sensitive information will be discussed.

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Example

A startup founder signs an NDA with a potential investor before pitching the business idea, ensuring the investor won't share the startup's technology or financial projections with competitors.

Used in a sentence

“The two companies signed an NDA before beginning merger negotiations.”

Related terms

Confidentiality Clause

A contract provision requiring parties to keep certain information secret and not disclose it to outsiders.

Breach of Contract

Failure to do what a contract requires, without a valid legal excuse.

Good Faith and Fair Dealing

A legal duty to act honestly and fairly when making and performing contracts.

Consideration

Something of value exchanged by each party to make a contract binding.

Entire Agreement Clause

A contract provision stating that the written agreement is the complete and final deal between parties.

Material Breach

A significant failure to perform a contract obligation that defeats its core purpose.

Offer

A proposal to enter into a binding agreement on specific terms.

Acceptance

Agreeing to the exact terms of an offer, creating a binding contract.

This page is a plain-English reference and is not legal advice. Laws vary by jurisdiction and change over time. For specific situations consult a licensed attorney.