Minnesota NDA Template
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A Minnesota NDA, or “nondisclosure agreement,” is essentially a legal agreement involving at least two entities, and it highlights what particular information you or the other party must keep under wraps. This type of contract is a common go-to for new ventures and established businesses, acting as a precautionary measure, keeping the company secure if employees, potential business collaborators, and the like, attempt to expose confidential business details. NDAs serve as a protective shield for your company's trade secrets and other crucial data— for example, your business plan or client mini-directory— safeguarding them from being made public or falling into rival hands.
Trade Secret Definition in Minnesota
“Trade secret” means information, including a formula, pattern, compilation, program, device, method, technique, or process, that:
(i) derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and
(ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.
The existence of a trade secret is not negated merely because an employee or other person has acquired the trade secret without express or specific notice that it is a trade secret if, under all the circumstances, the employee or other person knows or has reason to know that the owner intends or expects the secrecy of the type of information comprising the trade secret to be maintained. (Minnesota Uniform Trade Secrets Act MN Stat § 325C.01(5))
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Read on to learn more about Minnesota NDAs, including:
What's included in a Minnesota NDA?
Here are some key components that are typically included in a Minnesota Nondisclosure Agreement:
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Disclosing and Receiving Party
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Definition of Confidential Information
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NDA Purpose
- Use of Confidential Information
- Limited Access to Confidential Information
- Exclusions - What's not Covered
- Term of Confidentiality Period
1. Disclosing and Receiving Party
First, let's clear something up. When we talk about NDAs, we have two central characters: the Disclosing Party and the Receiving Party. It's straightforward, really. The Disclosing Party provides confidential information, and the Receiving Party is on the receiving end of that information. This applies mostly to unilateral NDAs. For mutual NDAs, both parties play both roles.
What if you're an individual, not a company? No issue at all. Just use your name while disclosing or receiving. Every role is significant, and the title doesn't change the essence of the job.
This nondisclosure agreement (this “Agreement”) is dated [Date] (the “Effective Date”) and is between [Company Name of Disclosing Party; e.g. “Max Studios, LLC”; if you do not have a formal legal entity, use your legal name, e.g. “Max Smith”], (the “Company”), and [Company Name of Receiving Party; if receiving party does not have a formal legal entity, use their legal name] (the “Recipient”).
2. Definition of Confidential Information
Some phrases evoke confusion, and "confidential information" is one that's poorly understood. Let's pretend for a moment: Your boss instructed, "Everything I tell you in the following two years is confidential." No clear boundaries, right? Broad phrases like these wouldn't stand in court but drafting excessively narrow definitions also risks accidental confidentiality breaches.
Avoid sleepless nights by using a standard definition from our template or discover further insights in our detailed NDA guide. Remember, clarity and precision can be entrepreneurs' best friends.
“Confidential Information” means any information that is proprietary or unique to the Company and that is disclosed by the Company to the Recipient during the term of this Agreement, including the following: trade secret information; matters of a technical nature such as processes, devices, techniques, data and formulas, research subjects and results; marketing methods; plans and strategies; information about operations, products, services, revenues, expenses, profits, sales, key personnel, customers, suppliers, and pricing policies; and any information concerning the marketing and other business affairs and methods of the Company which is not readily available to the public. “Confidential Information” also includes information of others that (1) is disclosed under this Agreement, (2) the Company is obligated to protect from disclosure or restricted from using or both, and (3) that would constitute “Confidential Information” if the information belonged to the Company.
3. NDA Purpose
Every NDA states its purpose. It could range from "developing a new product for the disclosing party" to "exploring potential business alliances". The goal of disclosing confidential information becomes crucial as it outlines the acceptable ways of using the shared information.
Suppose you're hiring a website developer. Sharing your business plan helps them tailor a website catered to your needs. To protect your shared information, you might want to specify the clause to be related to the specific sections of the website that the developer will be handling.
Subtle details, such as this, help ensure your shared information doesn't leave the room, securing you against any unwanted business threats.
“Purpose” means evaluating the parties’ capabilities in anticipation of pursuing one or more business opportunities.
4. Use of Confidential Information
Now that we have established the purpose of disclosing, let's place it under the microscope. The way you share the information directly relates to its intended use under the NDA, pretty straightforward, right? Let's not overlook it as such simple provisions can help avoid severe blunders like misuse of sensitive enterprise information. It's a safeguard against potential exploiters and maintains your private conversations private.
The Recipient shall use Confidential Information only for the Purpose. Unless otherwise agreed in writing, neither party shall disclose to a third party the fact that discussions or negotiations are taking place concerning the Purpose or any of the terms or other facts relating to the Purpose, including the status of negotiations between the parties.
5. Limited Access to Confidential Information
Most NDAs include a section addressing "Limited Access". It's here to handle issues about who will be handling your information. Carefully consider who genuinely needs to know, and restrict access only to them. If disclosure extends to an individual within the recipient’s circle, ensure this new person also signs an NDA. These steps will ensure your raincheck on potential confidentiality breaches beforehand.
The Recipient shall protect the Confidential Information from unauthorized use and disclosure using the same degree of care that it uses with respect to its own information of like importance, but no less than a reasonable degree of care. The Recipient shall retain the Confidential Information in confidence and shall not disclose Confidential Information to any third party without the Company’s prior written consent. However, the Recipient may disclose the Confidential Information to employees, contractors, consultants, and authorized representatives of the Recipient who (1) require access to the information for the Purpose, (2) are informed by the Recipient of the Recipient’s obligations under this Agreement, and (3) are bound by contract or fiduciary duty to obligations of confidentiality and use restrictions with substantially similar function, purpose, scope, and effect to those of this Agreement and that are at least as protective of the Confidential Information as this Agreement.
6. Exclusions - What's not Covered
Hang tight as we're moving onto the "exclusion" domain. These are aspects your NDA doesn't cover, aimed at enhancing the chances of your NDA holding in court, outlining boundaries for your agreement. You might remove some redundancies or previously disclosed details, but the template language should work effectively in most cases.
(a) This Agreement imposes no obligations upon the Recipient with respect to Confidential Information that: (1) was known to the Recipient before disclosure by the Company as evidenced by contemporaneous records; (2) has become publicly available through no fault of the Recipient; (3) is disclosed to the Recipient by a third party that has the right to make the disclosure to the Recipient and that does not have any obligation of confidentiality with respect to the Confidential Information; or (4) is disclosed by the Recipient with the Company’s prior written consent.
(b) If the Recipient is required by any governmental agency, court, or other judicial or regulatory body to provide any Confidential Information received under this Agreement, then the Recipient will not be deemed to be in violation of this Agreement for the disclosure if the Recipient promptly gives written notice to the Company of the requirement to provide the Confidential Information and cooperates with the Company so that the Company may contest the requirement to provide the Confidential Information. The Recipient may disclose only that portion of the Confidential Information that it is legally required to furnish.
7. Term of Confidentiality Period
Every NDA has a lifespan. This can range from a few days for one-off transactions to an indefinite period. You might also choose a period that extends beyond the actual business relationship to ensure the trade secret remains a secret as long as necessary. A tip from us: include a clause that secures your trade secret even after the business alliance terminates. Typical NDAs last one to five years, depending on your confidentiality requirements.
This Agreement will continue for a period of one year from the Effective Date unless: (1) terminated earlier by either party upon written notice to the other; (2) extended by the mutual written agreement of the parties; or (3) superseded by a subsequent written agreement that explicitly sets forth the obligations of the parties with respect to Confidential Information. With respect to business information, the Recipient’s obligations of confidentiality and non-use under this Agreement will expire three years from the termination of this Agreement. With respect to all information that constitutes a trade secret, the Recipient’s obligations of confidentiality and non-use under this Agreement will survive the termination of this Agreement for as long as such information remains a trade secret under applicable law.
What happens if I've already disclosed confidential information?
Did you accidentally let the cat out of the bag before signing an NDA? Don't fret; we've got your back. Adjust your agreement according to your situation, protecting your trade secrets. Here's how!
How do I protect my trade secret?
Remember, your confidential information’s value correlates directly with its trade secret status. To ensure your information is truly treasurable, prove it qualifies as a trade secret. Stumped? We have a guide ready to assist you in protecting your valuable business trade secrets.