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Non-Disclosure Agreement (NDA) Template

Use our Non-Disclosure Agreement to protect your confidential information. Begin by selecting the relationship between the parties.

4.7 1,109 Ratings

Updated October 27, 2023 Written by Josh Sainsbury | Reviewed by Brooke Davis

A Non-Disclosure Agreement (NDA) , also known as a confidentiality agreement, is a contract between two parties where one shares sensitive information and the other party promises to keep it confidential. Confidential information is often sensitive, technical, commercial, or valuable in nature (e.g., trade secrets or proprietary information).

Both parties sign the Confidentiality Agreement, creating a binding contract to keep the information secret. Be sure you understand how to write an NDA before drafting your own.

Non-Disclosure Agreement – By State

Connecticut
District of Columbia
Massachusetts
Mississippi
New Hampshire
North Carolina
North Dakota
Pennsylvania
Rhode Island
South Carolina
South Dakota
West Virginia
Types of Non-Disclosure Agreements

Basic/Standard Confidentiality Agreement

mutual non-disclosure agreement template

Unilateral (One-Way)

Independent Contractor

HIPAA Employee

Business Associate

Business Plan

Business Sale

Financial Information

Landlord-Tenant

Real Estate Buyer

Commercial Real Estate

Volunteer Non Disclosure Agreement Template

Movie (Film)

Patent/Invention)

Trade Secret

Software Development

Website Design

Product Development

Non-Disclosure Agreement - By State

What Is the Purpose of a Non-Disclosure Agreement?

How to write a non-disclosure agreement, sample non-disclosure agreement, frequently asked questions.

A Non-Disclosure Agreement aims to prevent confidential information from being publicly disclosed or used by any parties you share information with.

A signed NDA sets the legal framework to protect intellectual property and information from being stolen, sold, or shared with third parties, such as business competitors.

An NDA is typically used to:

To protect sensitive information – If you or your company need to protect sensitive data, you can use an NDA, so participants are legally bound not to divulge or release the information to other parties.
Protect patent rights – If you intend to share trade secrets, you must take reasonable steps to protect their confidentiality. An NDA is an appropriate step.
Outline what information is confidential – An NDA classifies exclusive and personal information to avoid confusion .

Examples of situations when a company uses an NDA:

In-depth business discussions
Hiring employees, freelancers, or contractors
Working with potential investors
Supplementing other agreements

Here is a walkthrough on how to create and fill out an NDA, what are the standard clauses you should include, and what they mean:

Step 1 – Disclosing and Receiving Parties

Start your NDA by establishing the “ Parties ” to the agreement. The “ Disclosing Party ” is the individual or entity sharing information. At the same time, the “ Receiving Party ” is the individual or entity receiving information.

Confidential information has been shared in a mutual NDA (a bilateral NDA). In this agreement, both parties serve as the Disclosing and Receiving Parties.

Here’s an example of how to start an NDA and establish the Parties to the agreement. Notice that the sample NDA clause also specifies what transaction or relationship the NDA relates to:

sample NDA parties to the agreement clause

Step 2 – Confidential Information

After the Parties have been established, specify what the Non-Disclosure Agreement protects confidential information.

Common examples of NDA-protected confidential information include:

Trade secrets

Special formulas
Instruments
Software development
Technical designs
Customer lists
Patent details

Business Ventures

Affiliate deals
Partnerships
Real Estate
Consultations
Advertising and marketing
Pricing structures
Business and financial records

Creative Endeavors

Documentary, TV, film, and news production
Illustrations, graphic design, and drawings
Inventions, prototypes, or product samples
Visitor or factory tours
Bachelor or bachelorette parties
Volunteering
Celebrity meet-and-greets
House tours
Original artwork

These are only a few examples of the types of information you wish to keep confidential under the protection of your NDA. Your agreement can list as many or as few confidential information as needed. Still, it would help if you were specific about what information the Receiving Party cannot disclose.

Being specific about what your NDA protects information will help it stand up in court in a legal dispute.

Step 3 – Exclusions from Confidential Information

An “ Exclusions ” clause defines what information the NDA does not protect.

Information that a Non-Disclosure Agreement can’t protect includes:

information already in the public domain
information the other party already has access to before the NDA
information that is independently developed or discovered by the recipient
information that the Disclosing Party has authorized the Receiving Party to share with the prior written consent

Read More: Understanding Confidential Information in NDAs

Oral information can be deemed confidential if confirmed in writing within a specific time frame after being disclosed.

Here’s an example of what your Exclusions clause should look like:

nda exclusions to confidential information clause

Step 4 – Non-Disclosure Obligations

The bulk of your NDA will comprise Non-Disclosure Obligations , which outline the Receiving Party’s obligations to the Disclosing Party’s information.

Rather than being a single clause, this section will likely comprise multiple clauses that detail various obligations.

This section will start with a clause like in the example below, which states the general obligation of the Receiving Party to keep the confidential information quiet.

Depending on your needs, you can add additional clauses to this section of your NDA. Here are some other provisions you may choose to include in your Non-Disclosure Obligations section:

1. Non-Disclosure of Transaction : the Receiving Party promises not to let others know that:

The Disclosing Party has shared or used Confidential Information.
A transaction is being discussed or negotiated.
A transaction has taken place, including the details of the relationship.

2. Non-Solicitation : either party may prevent the other from soliciting or offering employment to the other party’s employees or diverting business from the other party.

3. Non-compete : Parties agree not to engage in business activities directly competing with the other party. Many companies have partners and employees sign NDAs and non-compete agreements separately.

4. Non-Circumvention : if the Disclosing Party shares business contacts, a non-circumvention clause prevents the Receiving Party from bypassing the agreement and directly doing business or engaging with those contacts.

In the NDA sample below, you can see how these clauses may look in an agreement:

You may include only a few examples of Obligation clauses in your NDA.

Step 5 – Time Frame / Termination

The NDA should explicitly state how long it remains in effect. The Time Frame includes when the promise to keep confidential information secret begins (the “ Effective Date “) and the duration in which the protected information must not be shared with others (the “ Disclosure Period “).

Usually, the Parties agree to when the term of the agreement will end (known as the “ Termination ” provision). For example, the Non-Disclosure Agreement could terminate when:

The agreement expires
The transaction is completed, or
A specific period has passed.

Step 6 – Jurisdiction

The Jurisdiction clause establishes which state’s laws govern the Confidentiality Agreement. Suppose confidential information is leaked or inappropriately used by one party, and a lawsuit ensues. In that case, the laws of the agreed-upon state will apply, and any trials or hearings will occur there.

Ensure you understand state laws when writing a Non-Disclosure Agreement. Some states don’t honor certain kinds of NDA clauses. For example, California doesn’t honor non-compete clauses in most situations. Ensure your NDA template follows state laws, and you’ll avoid problems later.

Step 7 – Signatures

Finally, your NDA needs to include the signatures of all Parties and their Representatives.

Representatives are other people (i.e., directors, officers, employees, agents, or advisors) who may share, receive, or protect the information in pursuit of the Transaction specified in the NDA.

Here’s an example of the Disclosing Party’s signature section:

signature section in NDA sample agreement

Directly below this is the Receiving Party’s signature section, which is identical.

Step 8 – Additional Clauses

Every NDA will look different depending on the nature of the transaction, relationship, and information being specified. There are additional clauses you may choose to include in your Confidentiality Agreement:

Remedies : stipulates the consequences of breaking the NDA
No License: provides that the NDA doesn’t give either party any patent, copyright, or ownership of the information provided.
Severability : states that if one part of the NDA is ruled invalid in court, that part will be removed, and the rest of the agreement remains valid.
Amendments : notes that the NDA may be amended at any time.

You don’t need a lawyer to complete an NDA agreement template, but working with an attorney can help. If you have questions about adjusting or adding to your NDA, consulting a lawyer will ensure your agreement is legally sound.

The following confidentiality agreement sample is an excellent example of how you can structure your basic NDA agreement template. You can also check out our other NDA templates for samples.

What should an NDA include?
NDA vs. Non Compete
NDA vs. Confidentiality Agreement

Can I handwrite an NDA?

What should a Non-Disclosure Agreement include?

Your Non-Disclosure Agreement is applicable as long as you agree with the other party/parties involved. Typically, a standard NDA ranges from one to five years; however, depending on the information to be kept confidential, an NDA can be indefinite.

What’s the Difference Between a Non-Compete and a Non-Disclosure Agreement?

The primary difference between a non-compete and a non-disclosure agreement is the business activities they intend to restrict.

A non-compete agreement prohibits one party from doing business that competes with the other party . For instance, it prevents one party from hiring the other’s employees and business contacts and working with competing companies.
A non-disclosure agreement prevents one or both parties from using or leaking sensitive information learned in negotiations or business relationships.

These documents get confused because non-disclosure agreements often include a non-compete clause. Businesses bundle the non-compete clause into the non-disclosure agreement because it’s easier to sign one document than two.

What’s the Difference Between a Non-Disclosure Agreement and a Confidentiality Agreement?

There is no difference between a non-disclosure agreement (NDA) and a confidentiality agreement . Non-disclosure and confidentiality agreements protect confidential information from being shared with third parties.

In other words, these documents’ titles come down to preference because they both serve the same legal function. Some other names people use interchangeably with confidentiality and non-disclosure agreements include:

Secrecy Agreement
Confidential Disclosure Agreement (CDA)
Proprietary Information Agreement (PIA)

You may see a non-disclosure or confidentiality clause in other legal documents. For example, most independent contractor agreements outline the terms of a project and include a clause stating that any information shared is confidential.

You should not handwrite an NDA. Handwritten contracts are often dismissed in court because they are messy or incomplete. Always write NDAs digitally and print them out if you need a physical copy.

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Non-Disclosure Agreement /
Business Plan

Business Plan Non-Disclosure Agreement

non disclosure agreement for business plan

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A business plan non-disclosure agreement (NDA) is a form used by businesses to permit a 3rd party (be it a person or company) to view their business plan without the fear of the 3rd party sharing the contents of their plan with other entities. Business plans contain a massive amount of information regarding the disclosing company. The document typically includes financials, pricing, short and long-term strategies, goals, competitive advantages, and information on their customers, to name a few. In short, a company’s business plan going public could be severely damaging to their ability to compete in the market.

A business may share their business plan to those interested in purchasing their company, to investors (for the purpose of receiving funding), bankers, and lawyers, to name a few. While an NDA can go a long way in preventing their plan from going leaked to other parties, nothing is ever 100% secure. A company should only go about sharing their business plan if there is a necessary reason for doing so.

How to Write

Step 1 – Download

Save the template in PDF , WORD , or RTF .

Step 2 – Identifying the Parties

On the first line of the document, write the name of the company (or individual) sharing the business plan. If a company, the full legal name of the entity should be listed. On the next line, enter the name of the entity receiving permission to view the business plan. As before, this can be a person or a business.

Step 3 – Applicable Law

Enter the names of the county and state in which the NDA will be legally covered.

Step 4 – Signature

The only signature required for the form is that of the 3rd party. In addition to their signature, they will need to record the date in which they signed the document followed by their printed name.

Business Plan Non-Disclosure Agreement (NDA) Template

The business plan non-disclosure agreement is a document that restricts any individual from divulging proprietary information that is shared through a business plan. Lets say for example, that an entrepreneur is starting a new company and would like to run their idea by a colleague or friend, the only legal way for that business plan to be kept confidential is by the 3rd party to sign a non-disclosure. If after signing the agreement the Recipient of the business plan shares the information contained in it with anyone else the entrepreneur that created the business plan would be entitled to seek damages usually resulting in a monetary gain.

How to Write

Step 1 – Download in Adobe PDF or Microsoft Word (.docx) .

Adobe PDF – Microsoft Word (.docx)

Step 2 – In the 1st paragraph write the name of the business or individual that is sharing the business plan.

Step 3 – Enter the name of the person or entity that is receiving the business plan.

Step 4 – The person or entity that received the plan must sign , print , and date on the bottom of the form. After the signature of the receiving party the agreement is complete.

Financial Non-Disclosure Agreement (NDA) Template
Business Sale Non-Disclosure Agreement (NDA) Template
Unilateral Non-Disclosure Agreement (NDA) Template
Louisiana Non-Disclosure Agreement (NDA) Template
Pennsylvania Non-Disclosure Agreement (NDA) Template
New Hampshire Non-Disclosure Agreement (NDA) Template

Understanding Business Plan Non-Disclosure Agreements (NDA)

Written by Dave Lavinsky

Growthink.com Business Plan Non-Disclosure Agreements

When it comes to starting or expanding a business, creating a comprehensive business plan is crucial. A business plan is a written document that outlines the goals, strategies, financial projections, and other key details of a business venture. However, sharing sensitive business information, such as trade secrets, proprietary methods, or financial data, with potential investors, partners, or employees can pose risks. That’s where a Business Plan Non-Disclosure Agreement (NDA) comes into play.

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This article will explain to you what an NDA is and provide a sample NDA. However, before discussing that, it is important to note that most investors and lenders will not sign an NDA. So, you’ll need to keep that in mind.

Typically on the cover of a business plan , we’ll include the following:

CONFIDENTIAL

This document includes confidential and proprietary information of and regarding [Your Company Name]. This document is provided for informational purposes only. You may not use this document except for informational purposes, and you may not reproduce this document in whole or in part, or divulge any of its contents without the prior written consent of [Company Name]. By accepting this document, you agree to be bound by these restrictions and limitations.

While such a statement is far from 100% legal protection, it may provide dissuade readers from divulging information about your business plan and company.

What is a Business Plan Non-Disclosure Agreement

A Business Plan Non-Disclosure Agreement, also known as a Confidentiality Agreement or NDA, is a legal contract that aims to protect the confidential and proprietary information shared in the plan from being disclosed or used by third parties without authorization. It establishes a legally binding agreement between the parties involved, and it helps to ensure that the sensitive information shared in the business plan remains confidential and is not misused.

The main purpose of a Business Plan NDA is to safeguard the intellectual property and confidential information of a business. This may include, but is not limited to:

business strategies
financial projections
marketing plans
customer lists
trade secrets
proprietary technology
other sensitive information that gives a business a competitive advantage

By signing a Business Plan NDA, the recipient agrees to keep the information confidential and not to disclose, use, or exploit it for any purpose other than the intended business relationship.

What Key Elements are included in a Business Plan Non-Disclosure Agreement

A well-drafted Business Plan NDA typically includes the following key elements:

Definition of Confidential Information: Clearly specifying what information is considered confidential and protected under the agreement. This may include a broad or specific definition of confidential information, depending on the needs of the parties involved.

Obligations of the Receiving Party: Outlining the responsibilities of the recipient of the confidential information, including the duty to maintain confidentiality, restrictions on disclosure and use, and the requirement to return or destroy the information after the business relationship ends.

Permitted Disclosures: Identifying situations where the recipient may be allowed to disclose the confidential information, such as to legal or financial advisors, or as required by law.

Term and Termination: Establishing the duration of the NDA and specifying the conditions under which it can be terminated, such as by mutual agreement or by breach of the agreement.

Remedies for Breach: Outlining the consequences of breaching the NDA, such as damages, injunctive relief, or other remedies available under the law.

Governing Law and Jurisdiction: Specifying the applicable law and jurisdiction that will govern any disputes arising from the NDA.

Sample Business Plan Non-Disclosure Agreement:

Below is a sample business plan non-disclosure agreement (NDA). Since we are not lawyers, we recommend that have a lawyer review any NDAs you plan on using.

[Your Company Name]

[Recipient Name]

This Non-Disclosure Agreement (the “Agreement”) is made and entered into as of [Date] by and between Your Company Name (“Disclosing Party”) and Recipient Name (“Receiving Party”).

Definition of Confidential Information: The term “Confidential Information” shall mean any and all information disclosed by the Disclosing Party to the Receiving Party, including but not limited to business strategies, financial projections, marketing plans , customer lists, trade secrets, proprietary technology, and any other information that is not publicly available.

Obligations of the Receiving Party: The Receiving Party shall use the Confidential Information solely for the purpose of evaluating the possibility of a business relationship between the parties and shall not disclose or use the Confidential Information for any other purpose without the prior written consent of the Disclosing Party.

Permitted Disclosures: The Receiving Party may disclose the Confidential Information to its employees or advisors on a need-to-know basis, provided that such employees or advisors are bound by similar confidentiality obligations.

Term and Termination: This Agreement shall remain in effect for a period of [insert duration, e.g., 2 years] from the date of execution, unless terminated earlier by mutual written agreement or by breach of this Agreement. Upon termination, the Receiving Party shall promptly return or destroy all Confidential Information and provide written certification of such return or destruction to the Disclosing Party.

Remedies for Breach: In the event of a breach of this Agreement, the Disclosing Party shall be entitled to seek equitable relief, including but not limited to injunctive relief, as well as damages for any losses incurred as a result of the breach.

Governing Law and Jurisdiction: This Agreement shall be governed by and construed in accordance with the laws of [insert applicable jurisdiction such as “California”]. Any disputes arising out of or in connection with this Agreement shall be resolved exclusively by the courts of [insert applicable jurisdiction].

Entire Agreement: This Agreement contains the entire understanding between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements and understandings, whether oral or written, relating to the Confidential Information.

Binding Effect: This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.

By signing below, the parties acknowledge and agree to the terms of this Agreement:

[insert name, signature and date lines]

How It Works
Sample NDA Template
Non-disclosure (NDA)

Share business plan by using NDA agreement

If you have an idea running around in your head that refuses to go away and you want to create a startup, small business, a nonprofit or some other type of commercial enterprise, you’ll likely have heard someone tell you that you should create a business plan.

A business plan is a high-level roadmap for your business that covers many different aspects of a business such as market research, sales, target market, competitor SWOT analysis (strengths, weaknesses, opportunities, threats), human resources, financial plans and a management team.

Creating a business plan is a very useful exercise in itself because it helps you to think ahead and consider where you would like be, the potential possibilities as well as the gaps in your business. Besides internal planning purposes, some business plans are created for the purpose of seeking funding from banks, investors and other financial institutions.

On top of this, business plans can also be created for the purpose of sharing your vision and plans with potential customers, joint partners and potential buyers of the business.

For example, you may be looking at creating a joint partnership with another person or inviting another entrepreneur to join you in a key position within your startup.

Business plans often include a few key elements that are highly confidential .

1.1 Market strategies and analysis
1.2 Main competitors
1.3 HR/Personnel Information
1.4 Financial information
2.1 Definition of Confidential Information
2.2 Duration
2.3 No Grant of Rights
2.4 Authority
2.5 Binding on Others
2.6 Jurisdiction
2.7 Termination of Contractual Relationship
3 If the other party refuses to sign a NDA

Information in the business plan

Market strategies and analysis.

A business’s marketing strategies and market research is normally detailed in a business plan. Information can range from market segmentation and types of ideal customers, market trends to analyses of how marketing strategies can be used to reach these groups more effectively.

Here’s an example of a market analysis chart for a technology business plan:

Example of a market analysis from a business plan

Main competitors

Business plans can also contain valuable information on competitors within the market, niche or industry.

Here’s an example taken from a template business plan:

Example of Main Competitors information from a business plan

HR/Personnel Information

Human resource planning and high-level personnel information may also be listed in the business plan as illustrated from this example :

Example of Personnel information from a business plan

Financial information

Business plans also provide sensitive financial data such as balance sheets, projected cash flow forecasts and projected profit and loss statements.

Here’s an example of a projected cash flow graph:

Example of Projected Cash Flow information from a business plan

Here’s another example of extremely confidential information that is normally included in a business plan. In this example, sales forecasts, current liabilities, capital and cash flow data are listed in the appendix of this example of a plan for software publishers. The full appendix is on Bplans website :

Example of confidential data from appendix from a business plan

Enter the Non-disclosure agreement (NDA)

Since business plans often reveal the heart, soul and secrets of a business , you probably want to make sure that anyone that you share your business plans with will keep your information confidential.

One of the legal tools that you may find useful to help you achieve protection for your sharing of confidential information is a non-disclosure statement (NDA) .

A NDA is a contract between parties wherein the party receiving confidential information (“Receiving Party”) promises the party that is divulging information (“Disclosing Party”), to keep the information secret.

In the case of a breach, the NDA can be drafted to allow you to seek monetary remedies but more importantly, you have the opportunity to seek equitable and injunctive remedies that force the Receiving Party to stop sharing or disclosing your confidential information without your permission.

Although you may never actually enforce a NDA against another person, requiring another party to sign this kind of agreement can a great way to give advanced notice to another party that the confidentiality of the details in your business plan is vital.

You’ll probably only be looking at using a unilateral agreement, also known as a one-way NDA , unless the other party is intending to be sharing confidential information with you as well, in which case, you would use a mutual NDA .

Here are some important points to note and useful clauses that you should have in this legal document.

Definition of Confidential Information

You should include in your NDA agreement a definition of what would be considered confidential information.

You want to make sure that your definition covers all the confidential information that you intend to reveal but is also not too broad and vague as this may come across as unreasonable by certain courts.

You have to be prepared to justify why the information needs to be protected by confidentiality, if ever questioned by the courts.

For example. in Lasership, Inc. v. Watson , the court in Virginia were not happy that the scope of the definition of confidential information in the agreement before them was applied too broadly.

Confidentiality can normally extend to things such as documents, designs, sketches, analyses, source codes, marketing plans, manufacturing processes and technical procedures.

However, in your case, you should probably state that confidential information refers to all information within your business plan as well as any discussions regarding the details of the plan.

Here’s an example of a clause defining what would be considered confidential for the parties in Accuride Corp’s Confidentiality and Non-Disclosure Agreement.

Definition of confidential information from agreement of Accuride

Another important clause that impacts the scope and reasonableness of a NDA is the duration for which the requirement of confidentiality is imposed.

A court may consider a NDA unreasonable if the restriction on disclosure of confidential information is too long .

In Augusta Medical Complex, Inc. v. Blue Cross of Kansas, Inc. , the Kansas court was against contracts with indefinite time durations.

As most business plans are subject to ongoing change and revision as a business evolves, it’s likely that a short time duration for your agreement would be sufficient.

It’s also unlikely that you will be revealing any trade secrets when discussing your business plan but if you do intend to share trade secrets, then you can disregard the limited time duration and apply a perpetual duration requirement to protect your trade secrets.

A trade secret is entitled to confidential protection as long as it continues to remain a trade secret and efforts have been suitably made to maintain its confidentiality.

No Grant of Rights

It’s also useful to clarify that the sharing of your confidential information through your business plan does not grant any rights to the Receiving Party to the information.

Here’s an example of a clause in an agreement:

Example clause of No Implied Grant of Rights in Confidential, Non-disclosure, Non-use

If the Receiving Party is an entity, the NDA needs to be signed by a person who is legally authorized to do so on behalf of the entity .

To cover for cases of mistake and fraudulence, you can insert a clause in your agreement that the parties affirm that the individuals signing the agreement have binding authority.

Here’s a simple clause from the Canadian Corporate Counsel Association’s Mutual Confidentiality and Non Disclosure Agreement template:

Binding on Others

The Receiving Party may wish to consult with their attorney, accountant or other third parties to determine if your business plan makes sense and is viable.

To enable them to carry out their consultation without sacrificing your confidentiality, you can insert a clause that this NDA is to be binding on anyone that the Receiving Party shares your business plan with.

Here’s an example of a clause from Accuride’s Confidentiality and Non-Disclosure Agreement again:

Binding agreement clause from Accuride Corporation

Jurisdiction

If you ever needed to enforce the terms of your NDA against the Receiving Party in court, the jurisdiction and governing law that would apply to your agreement will be enormously important.

Jurisdiction refers to the court that will have authority to rule over your case. Governing law refers to the laws of a particular state or country that will be apply to the NDA.

The jurisdiction does not have to match the governing law.

For example, you may state that you wish English law to apply and the jurisdiction to be the New York courts. This means that you are granting authority to a New York court to apply English law when assessing the terms of the NDA.

If you omit to include a clause specifying the jurisdiction or governing law, you may be looking at additional costs and time spent in court trying to determine this issue.

Different jurisdictions and governing laws can results in different outcomes.

Most Disclosing Parties choose a jurisdiction or governing law that would be favourable to their cause.

However, there’s one thing to note. Article 25 of the Brussels regulation requires that there must be consensus reached between contracting parties when it comes to jurisdiction.

Because your NDA is most likely going to be a unilateral agreement, make effort to point out the jurisdiction and governing law clause to the Receiving Party and make note of their consent in case it is ever needed as evidence.

An example of a clause that provides for jurisdiction can be found in a NDA from Harvard Business School :

An example of a Jurisdiction clause in the NDA template of Harvard Business School

Termination of Contractual Relationship

If both of you choose not to work together after the sharing and discussion of your business plan, then you should think about what you want the Receiving Party to do with that plan and all the confidential information you shared.

You could require them to return to you all copies of your business plan or to destroy any copies or records of information that are in their possession.

An example of such a clause can be found in Accuride Corp’s Confidentiality and Non-Disclosure Agreement.

Ownership and Return of Confidential Information clause in agreement from Accuride Corp

If the other party refuses to sign a NDA

Due to the nature of confidential information within a business plan, a NDA can be highly important for confidentiality.

However, in reality, we know that when it comes to investors, venture capitalists and banks (basically anyone you are asking money from), they will generally refuse to sign a NDA just to listen to a pitch.

Most investors may be looking at over 20 pitches in a week and they’re aware that there’s often a lot of cross-polarization and similar ideas in the industry, but it’s the execution of the idea that many people fail on.

Most investors, venture capitalists and larger companies want to uphold their reputation and would not be interested in stealing your idea anyway. If an investor or venture capitalist is involved in a project that’s similar to yours, they normally decline to meet with you to avoid any conflicts of interest.

If the investor or venture capitalist refuses to sign your NDA, but you’re worried about keeping your information confidential, instead of emailing them the business plan, put it on your laptop and share it with them during your meeting that way.

That way, there are no copies of your confidential information floating around.

Alternatively, grant them access to the document online with a password that you can then revoke once your meeting is completed. However, as much as possible try to limit the amount of confidential information that you share until they have confirmed that they’re truly interested in investing in your idea.

As for potential co-founders and partners that you’re thinking of partnering with, try to test them out first to see if you think you want to take the relationship deeper.

Keep your chat to a brief and informal one to find out what the other party thinks about the general idea of what you are saying.

You don’t need to share too many confidential details, just share the ‘ what ‘ and not necessarily the ‘ how ‘.

Once you’re confident that you want to work with them, and them with you, then you can negotiate a NDA agreement.

Jan 30, 2017 | Non-disclosure Agreements

This article is not a substitute for professional legal advice. This article does not create an attorney-client relationship, nor is it a solicitation to offer legal advice.

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Non-Disclosure Agreement (NDA) Explained, With Pros and Cons

What Is a Non-Disclosure Agreement (NDA)?

A non-disclosure agreement (NDA) is a legally binding contract that establishes a confidential relationship between two parties: one that holds sensitive information and the other that will receive that sensitive information. The latter agrees that the sensitive information they receive will not be made available to others. An NDA may also be referred to as a confidentiality agreement.

Non-disclosure agreements are common for businesses entering into negotiations with other businesses. They allow the parties to share sensitive information without fear that it will end up in the hands of competitors. In this case, it may be called a mutual non-disclosure agreement.

Key Takeaways

An NDA acknowledges a confidential relationship between two or more parties and protects the information they share from disclosure to outsiders.
The NDA is common before discussions between businesses about potential joint ventures.
Employees are often required to sign NDAs to protect an employer's confidential business information.
An NDA may also be referred to as a confidentiality agreement.
There are two primary types of non-disclosure agreements: mutual and non-mutual non-disclosure agreements.

Investopedia / Tara Anand

Understanding Non-Disclosure Agreements (NDAs)

The NDA serves a purpose in a variety of situations . NDAs are generally required when two companies enter into discussions about doing business together but want to protect their own interests and the details of any potential deal. In this case, the language of the NDA forbids all involved from releasing information regarding any business processes or plans of the other party or parties.

Some companies also require that new employees sign an NDA if the employees have access to sensitive information about the company. For some companies, all employees will be required to sign the agreement; for others, only select departments or types of employees will be subject to the agreement.

NDAs may also be used before discussions between a company seeking funding and potential investors. In such cases, the NDA is meant to prevent competitors from obtaining their trade secrets or business plans.

However, many investors will be reluctant to sign NDAs. Not only will this potentially prevent them from sourcing future deals with different companies, but the agreement may be very difficult to enforce and prove wrongdoing. Instead of being burdened by a legal contract even after declining an investment opportunity, most investors will simply not sign the agreement.

In all of the above, the information that is being protected may include a marketing strategy and sales plan, potential customers, a manufacturing process, or proprietary software. If an NDA is breached by one party, the other party may seek court action to prevent any further disclosures and may sue the offending party for monetary damages.

Types of NDAs

The mutual agreement.

Consider situations where two businesses are discussing the possibility of partnering together. As part of strategic discussions, each company may disclose information about its operations to better inform the other side of its capabilities. In such arrangements, both parties often agree to not disclose information as each side often receives sensitive information.

The Non-Mutual Agreement

This type of agreement usually applies to new employees if they have access to sensitive information about the company. In such cases, the employee is the only party signing the agreement that is prevented from sharing confidential information. Also called a unilateral NDA, only one party is bound to confidentiality as they are the only party receiving sensitive information.

The Disclosure Agreement

Increasingly, individuals are asked to sign the opposite of a non-disclosure agreement. For example, a doctor may require a patient to sign an agreement that the patient's medical details may be shared with an insurer . This provides one party with the authority to share personal information and to prevent them from being sued for doing so.

An NDA is a legally binding agreement; a violation can lead to legal penalties.

Requirements for an NDA

NDAs may be customized for any situation. In general, there are usually six major elements that are considered essential to any non-disclosure agreement:

Participants to the Agreement

Every non-disclosure agreement must specifically designate who every party involved entails. The individual receiving the sensitive information may be a specific person, all employees of another specific company, or any representative of the company.

On the other hand, it's very important for a company to appropriately define itself in an NDA. For example, consider companies with complex legal structures. The company must appropriately determine which legal entity has ownership of the information; in many cases, a company may simply list any legal entity under a broad ownership umbrella.

Definition of Confidential Information

Often among the most difficult pieces to appropriately define, an NDA must state what information is considered to be confidential. A company can not simply assume that proprietary information will be understood by all, and it is the company's responsibility to identify what information must not be shared.

The difficulty of defining confidential information is the process of not disclosing such information itself within the NDA. For this reason, companies may broadly assign confidentiality to a large group. For example, the company may assess that any information disclosed from or regarding its research and development department may be confidential.

Exclusions of Confidentiality

In some situations, it may just be easiest to define what is not confidential. In these types of agreements, a company states that all information shared with an external party is to be confidential except for specific items determined by that company. These types of agreements intend to allow a company to catch any exceptions that would have otherwise slipped by.

Appropriate Uses of Information

Sometimes, a company may state that no information is confidential. However, it may simply limit how the external party may use the information that has been given to them. For example, a company may be fine disclosing operating processes to another party. However, that party cannot use the information to share with a competitor or replicate it for personal financial benefit.

Time Period

Especially relating to research and development, many proprietary bits of information simply expire or become less valuable over time. Consider the early days of Apple iOS ; many components of the operating service were unknown, and the technology was widely unknown by the market.

Today, much of that information is replicated by other companies or adapted into newer technologies. For this reason, what was once sensitive information may have lost its luster, and companies often define when the information is no longer confidential.

Other/Miscellaneous Provisions

As mentioned earlier, NDAs may be customized to serve any need. Different industries may have different requirements, and government agencies may have more stringent requirements for keeping sensitive information private.

In this area, an NDA may also detail applicable state law or laws that apply to the agreement and which party pays attorney fees in the case of a dispute. This may also define the course of action if the agreeing party should fail to comply with the terms.

There are endless opportunities for companies to protect themselves with an NDA. In general, NDAs are used to protect information including but not limited to:

Customer information. This includes major customers, major customer contact information, and customer preferences. This may also include any direct communications with customers.
Financial information. This includes specific financial information relating to any customer or any financial information not required to be publicly disclosed. This type of information is often more related to cost accounting information as opposed to financial accounting information.
Intellectual property. This includes patents, copyrights , trade secrets, technologies, and anything a company uses as a competitive advantage.
Marketing information. This includes processes, billing policies, pricing strategies, and advertising techniques.
Operating information. This includes employee data, supplier information, any information related to payroll, or any aspect of internal costs required to operate the company not required to be publicly disclosed.

NDAs can't contain specific pieces of information if the information is common knowledge or already in the public domain. This includes any information that may be widely known or considered public knowledge, though there may be a discrepancy around how this is defined. This also includes information that becomes publicly known at no fault to the recipient of the NDA.

Information that the receiver of the NDA already knows before receiving the agreement can not be included in the agreement. In addition, information that can be determined via independent research or rightfully obtained from a third party can not be defined as confidential as well.

Advantages and Disadvantages of Having an NDA

The primary benefit of an NDA is that sensitive information regarding your company is kept secret. This can be anything from research and development (R&D), to possible future patents , finances, negotiations, and more. Signing an NDA is a way to protect private information from becoming public.

NDA agreements are also clear. They specify what and what cannot be disclosed to avoid any confusion. NDAs can also be created at a low cost as they are just a signed piece of paper. This is one of the most cost-effective ways to maintain private information.

NDAs also outline the consequences of disclosing prohibited information, which should prevent any leaks. Furthermore, NDAs are a good way to maintain comfort and trust in a relationship.

When entering into a non-disclosure agreement, make sure that confidential information and trade secrets are distinguished from each other. The latter usually has an indefinite period of confidentiality.

One of the primary disadvantages of an NDA agreement is that it starts a relationship off on the idea of mistrust. This can set the tone of the relationship and may not always result in a positive one. Employee NDAs can also prevent top-tier talent from joining your firm, knowing they'd be limited in discussing their job in the future.

Similarly, asking current employees to sign NDAs when working on special projects may sour their experience of working for the company as they will feel less trusted. NDAs can also result in potential lawsuits if breached, becoming a headache for everyone involved.

Information kept private

Clarity on what information can and cannot be shared

Low cost to create

Outlines consequences

Can create an atmosphere of mistrust

Risk of deterring top-tier talent from joining the firm

Can possibly sour the relationship with current employees

Example of an NDA

Apple is one of the most private companies in the world. The company keeps its technology and future products closely guarded until the company is ready to release them. It does this to deter competitors from stealing trade secrets and copying its products , as it has been a pioneer in technology for most of its life, and also to generate buzz as a marketing ploy.

In an article from CNBC from January 2021, carmaker Hyundai confirmed in a statement that it was in talks with Apple regarding cars. This, of course, raised suspicion that Apple is possibly entering the car market or creating a product related to automobiles. Hyundai then released a follow-up statement that removed any mention of Apple

Apple insists on secrecy in all of its relationships and makes any partner sign NDAs. Apple tells its partners that they cannot mention the name "Apple" in any manner, and Apple has threatened partners that have leaked information with monetarily hefty lawsuits.

What Happens If You Break a Non-Disclosure Agreement?

If you break an NDA, you will be susceptible to the consequences outlined in the contract. Breaking an NDA is not considered a crime, however, depending on what was violated, it can be a crime, for example, if the issue is theft of trade secrets. Usually, a person will be sued if they break an NDA, which may result in a monetary fine, termination of employment, or the return of an asset, depending on what was agreed upon. You may also be sued for intellectual property violations such as copyright infringement and breach of fiduciary duty. A court may levy financial damages and associated legal costs.

How Long Does an NDA Last?

Every NDA is unique so each one will last a different amount of time. Common timeframes range between one year to 10 years, however, depending on the information that is to be kept private, an NDA may be indefinite. For an NDA to be enforceable in certain states, it must not be too open-ended or generic, or the courts will throw it out.

How Much Does an NDA Cost?

The cost of an NDA can vary depending on the complexity of the agreement. The cost of creating one typically ranges from $175 to $1,500.

What Is an NDA Template?

An NDA template is a template of a non-disclosure agreement that an individual or company can follow to create their own NDA. The template will have the general legal information and blanks that can be filled in to create a unique NDA between two or more parties that apply to their relationship.

NDA templates are easily found online through an Internet search. Many sites offer NDA templates for use.

Non-disclosure agreements are low-cost, easy-to-create legally binding documents between two or more parties that keep private information confidential. They are used by organizations and individuals to protect their businesses or personal information and allow businesses to work together without the fear of private information entering the hands of competitors.

When drafting an NDA, it is important to be as detailed as possible, so all parties know what can and cannot be shared as well as the consequences of leaking information.

CNBC. " Hyundai Motor Says it’s in Early Talks With Apple to Develop a Car, Sends Shares Soaring 19% ."

CNBC. " Doing Business with Apple Means You Probably Can't Tell Anyone About It, As Hyundai Learned ."

Wood Litigation. " Are Non-Disclosure Agreements Enforceable in California? "

Priori Legal. " Non-Disclosure Agreements ."

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Using an NDA when you're building a business plan

Starting a new company requires you to share your business plan with a variety of investors, banks, and potential partners. Here's how to protect your confidential information.

Find out more about business management

by Brette Sember, J.D.

Brette is a former attorney and has been a writer and editor for more than 25 years. She is the author of more than 4...

Creating a basic business plan

Understanding nondisclosure agreements, what to include in a nondisclosure agreement, refusal to sign a nondisclosure agreement.

Starting a business is exciting, but there are a lot of steps to take to get from brilliant idea to successful company. The most important building block of your new venture is your business plan, which you'll be sharing with a lot of people. Because of this, you'll want to use a nondisclosure agreement (NDA) to ensure your hard work and planning remains confidential.

Hand holding a piece of chalk on a black backdrop with white letters spelling "N.D.A."

Creating a strategic business plan not only allows you to think through every aspect of your business, it provides a tool you can use to get investors, funding, new customers, and partners.

A well-developed business plan helps you recognize and deal with many possible impediments to your success in advance. It also helps you sharpen your strategy so that you can hit the ground running. A good business plan takes weeks or months to create and requires a lot of research and planning. A basic business plan should include:

M arket analysis and strategy. This section looks at market trends, the segment of the market you will target, and the strategies you'll use.
C ompetitors. List the companies you see as your direct competitors and how you will differentiate yourself from them.
Staffing and employees. You might list specific people who will join your team or identify key roles and skills you need in employees.
Financial data. Include sales predictions, capital, debts, and more—basically all the financial details of your company.

You can create a business plan using a template or work with a legal service provider or an attorney to create one. Be sure the document is thorough and complies with your state's laws.

A nondisclosure agreement states that your business will give an individual or another business information that they agree to keep secret. If the agreement is breached , you can seek compensation. Using an NDA signals that the information you're sharing is private and critically important to your business.

An NDA is usually one-sided , meaning you're providing confidential information to the other person only. However, it could be two-sided, or mutual, if both parties are sharing confidential information with each other, such as if you're in talks with a potential partner.

Before sharing your business plan with potential investors, customers, partners, or banks, you should first have them sign an NDA , which should include the following information:

Definition. Describe clearly what you are characterizing as confidential so that there can be no misunderstanding. Generally, you want to state that your entire business plan is confidential, as well as any supporting material you provide and any discussions you have about the business plan.
Jurisdiction. The agreement should indicate which state's laws apply to the agreement.
End of relationship. If you and the other party receiving the business plan decide not to work with each other and terminate your business relationship, the information you provided should be returned to you, destroyed, or deleted.
Length of agreement. An expiration date is normally included, as NDAs cannot be open-ended.
Ownership of the information. The NDA should make it clear that just because you're sharing information, you're not giving the receiving party any ownership rights in the information.
Other people. The party you're sharing the business plan with may need to show it to people who work for or with them, such as their accountant or lawyer. The agreement should state that the NDA is binding on those third parties as well.
Signatures. The agreement should be signed by you and someone from the receiving party who has legal authority to enter into the agreement. The NDA should make it clear that this person has the authority to do so and that their signature is binding on their company.

You may find that large banks or investors won't sign your NDA. This can be frustrating, but because such large funders review hundreds of business plans or pitches every month, they may see doing so as an undue burden.

To protect yourself, you could bring a digital copy of your business plan to your meeting and not allow them direct access.

Another idea is to put the business plan online behind a password, making sure to change the password often. You could also withhold as much confidential information as possible until the investor is seriously interested.

An NDA offers an important way to protect yourself as you share your business plan and seek investors or partners. Taking this extra step can ensure your ideas and data are not stolen or shared without your permission.

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Navigating the ftc’s ban on (most) non-competes: the new world of partnerships and non-solicits .

May 22, 2024 07:01 am 0 Comments CATEGORY: Regulation & Compliance

Executive Summary

Non-compete clauses are common features of employment agreements around the business world and are often used to dissuade companies from 'poaching' another's employees, and/or to prevent employees (at least for a certain time period) from taking the knowledge gained from working at one company to a competitor. Which can allow companies to protect the 'investments ' they have made in their employees and maintain continuity amongst their staff.

However, these agreements can also be unduly restrictive towards employees, limiting their ability to advance within their chosen industry, which is especially problematic in skilled professions that might have required years of education and training just to enter in the first place. Further, critics of non-compete agreements argue that they restrict dynamism in the overall economy by making it harder for businesses to hire (as the pool of applicants will be smaller in industries where non-competes are prevalent ), and for employees subject to non-competes to start new companies.

With these factors in mind, the Federal Trade Commission (FTC) in April of 2024 announced a final rule banning most non-competes nationwide that is expected to take effect (pending legal challenges) on September 4, 2024. To comply with the rule , employers are required to provide written notice to relevant workers ( which include employees and independent contractors, among other categories), letting them know that their non-compete agreements are unenforceable and will not be enforced .

Notably, the ban includes exemptions for "senior executives " who previously had signed a non-compete (new non-competes are banned for all employees, including senior executives) and in the case of a "bona fide sale of a business entity, of the person's ownership interest in a business entity, or of all or substantially all of a business entity's operating assets " . This latter exemption means that financial advisors with an ownership interest in their company (even a very small one) could still be subject to a non-compete as a term of the sale of their stake (which could impact how they value receiving an ownership interest in their firm).

Furthermore, the regulation does not prohibit non-solicit agreements (which restrict a departing employee from soliciting the clients of their former employer for a specified time period ), which are more common than non-competes in the financial advice industry, meaning that non-solicit agreements can remain in place, and might even become more prevalent amongst firms that are no longer able to enforce non-competes. But because enforcing non-solicits can be less clear-cut than enforcing non-competes (given that it is more difficult to tell whether an individual is actively soliciting their former employer's clients compared to obtaining a job at a competitor or starting their own business), the number of legal battles over non-solicits could increase as their use rises . Which could make it more advantageous for firms and advisors alike to consider a more equitable, cooperative approach than strict on-competes or non-solicits to deciding which clients an advisor can solicit if they do eventually leave the firm.

Ultimately, the key point is that the FTC's ban on non-competes may provide advisors with increased flexibility to move amongst firms within the financial advice industry, while also offering the opportunity for both financial advisory firms and their advisors to revisit their employment agreements… not only to ensure that they comply with the FTC's final rule, but also so that they better meet the needs advisors and their firms!

Michael Kitces

Michael Kitces is Head of Planning Strategy at Buckingham Strategic Wealth , which provides an evidence-based approach to private wealth management for near- and current retirees, and Buckingham Strategic Partners , a turnkey wealth management services provider supporting thousands of independent financial advisors through the scaling phase of growth.

In addition, he is a co-founder of the XY Planning Network , AdvicePay , fpPathfinder , and New Planner Recruiting , the former Practitioner Editor of the Journal of Financial Planning, the host of the Financial Advisor Success podcast, and the publisher of the popular financial planning industry blog Nerd’s Eye View through his website Kitces.com , dedicated to advancing knowledge in financial planning. In 2010, Michael was recognized with one of the FPA’s “Heart of Financial Planning” awards for his dedication and work in advancing the profession.

Read all of Michael’s articles here .

Adam Van Deusen, CFP

Adam is a Financial Planning Nerd at Kitces.com . He previously worked at a financial planning firm in Bethesda, Maryland, and as a journalist covering the banking and insurance industries. Outside of work, he serves as a volunteer financial planner and class instructor for local and national non-profits.

Federal Trade Commission Bans (Most) Non-Competes

The Federal Trade Commission (FTC) defines a "non-compete " as: "A term or condition of employment that prohibits a worker from, penalizes a worker for, or functions to prevent a worker from: (i) seeking or accepting work in the United States with a different person where such work would begin after the conclusion of the employment that includes the term or condition; or (ii) operating a business in the United States after the conclusion of the employment that includes the term or condition. For the purposes of this [non-compete definition], term or condition of employment includes, but is not limited to, a contractual term or workplace policy, whether written or oral."

While the FTC's non-compete ban is expected to go into effect on September 4, 2024, it has been hit with legal challenges, including a lawsuit filed the same day the final rule was announced. Opponents of the non-compete ban argue, among other things, that the FTC overstepped its authority regarding the regulation of "unfair methods of competition" in creating an all-encompassing ban on non-competes. Which means that the rule's ultimate fate will likely be decided in the courts, which could choose to issue an injunction to temporarily block enforcement of the rule until a final ruling is made.

In this context, the Federal Trade Commission's (FTC's) final rule , under its authority to regulate "unfair methods of competition " , is meant to serve as a nationwide ban on both current (i.e., already existing) and future (i.e., created after the rule's issuance) non-compete agreements as defined above. However, there are some exceptions, including industries over which the FTC does not have jurisdiction (e.g., banks and credit unions, among others), existing non-compete agreements for "senior executives " , and non-competes related to the "bona fide sale " (i.e., not an internal restructuring) of a business or the sale of an individual's stake in a company (which could have implications for financial advisors with a partnership stake in their firm).

A Ban On New And Existing Non-Competes

Under the final rule, new non-compete agreements are banned , and existing non-competes can no longer be enforced as of the effective date of the rule (expected to be September 4, 2024). Notably, this restriction applies not only to a company's employees, but also extends more broadly to an "independent contractor, extern, intern, volunteer, apprentice, or sole proprietor who provides a service to a client or customer " . To comply with the rule , employers are required to provide written notice to relevant workers, letting them know that their non-compete agreements are unenforceable and will not be enforced . (The FTC provided model language employers can use for this notice on page 565 of the Final Rule .)

Do you recall if you even signed a non-compete in the first place? In some cases, employees sign "a lot of paperwork" when being hired for a new job, of which they don't always keep a personal copy. This can create challenges when they later aren't sure if there was a non-compete provision in their employment agreement, as it can be awkward to ask HR (or in the case of a very small firm, the owner/founder) for a copy of their own employment agreement years later ("why do you ask, are you thinking about leaving!?"). However, the notice requirement of the FTC's ban on non-competes means that those who aren't certain about whether their employment agreement contained a non-compete should receive notice from their employer, when the rule takes effect, affirmatively clarifying if there was a non-compete (that is no longer valid). On the other hand, requesting a copy of the employment agreement for a financial advisor will likely still be necessary, given the high likelihood that if a non-compete provision was included in their original agreement, non-solicit or similar restrictions were also present, that will likely still apply.

One exception to the ban on existing non-competes is for "senior executives " who previously had signed a non-compete (new non-competes are banned for all employees, including senior executives). The FTC defines "senior executive " as an individual in a "policy-making position " and who earned at least $151,164 in total compensation in the preceding year (or the year before termination).

Notably, there is some ambiguity about what exactly entails a "policy-making position " that would qualify for an exception from the ban on existing non-competes: While certain executive officers (e.g., a company's president or chief executive officer) would clearly fall under this definition, the FTC also includes "any other officer of a business entity who has policy-making authority, or any other natural person who has policy-making authority for the business entity similar to an officer with policy-making authority", which could leave some in positions with arguably some policy-making authority (e.g., HR or Operations department directors), but who don't rank among senior firm leadership, in an ambiguous situation with regards to the enforceability of any existing non-competes.

In the advisor context, though, it would appear that this "senior executives " exemption would only apply to advisors who also exert control over the policies of the firm as a whole (i.e., regarding how employees and the business are managed ), rather than 'just ' how they manage their own clients. As a result, a typical financial advisor position – even one with income well above the $151,164 threshold – would still have its non-compete provisions voided after the effective date of the ban . But an advisor who also has an" executive " position that has some authority to set policy for how other advisors at the firm work with their clients – for instance, a Director of Financial Planning, Chief Investment Officer, etc. – may have an existing non-compete 'grandfathered ' in if their income is also above the threshold.

A Key Exemption To The Non-Compete Ban For Bona Fide Sale-Of-Business Transactions

While the FTC's non-compete ban covers most agreements between employers and employees (other than the "senior executive " exemption described above), it provides for an exemption to the ban that applies in the case of a "bona fide sale of a business entity, of the person's ownership interest in a business entity, or of all or substantially all of a business entity's operating assets " .

This exemption is meant to provide protection to the buyer in a business transaction to ensure that the "goodwill " (i.e., the intangible assets associated with the purchased company) remains with the buyer. For example, in the case of a sale of a financial advisory firm, a non-compete agreement could ensure that the selling firm owners do not simply open up a new firm and seek to attract their former clients after the deal is completed (and they were already fully compensated for that client goodwill).

Notably, while the originally proposed version of the non-compete ban limited the ability to impose non-compete agreements only on those who owned at least 25% of the selling company, the final rule removed this ownership limitation, meaning that the terms of a transaction could, for instance, require all owners of a selling firm, with any ownership stake, to be subject to non-compete agreements for a certain period of time after the transaction closes.

Which means that employee advisors, who otherwise might not be subject to a non-compete agreement under the "employee " part of their arrangement under the FTC's ban, could still find themselves subject to one if they have an ownership interest (even a 'small ' 1%-of-less partner stake!) and their firm is sold .

In addition, it's notable that the "bona fide sale " clause not only applies when "the business " itself is sold – it also applies to the sale of a personal's ownership interest in a business entity . Which appears to mean that in cases where a financial advisor is a partner/ equity-owner who decides to sell their shares back to the firm (perhaps in connection with their departure from the firm), a non-compete may be attached to such a transaction in the sell-back negotiation process.

Client Non-Solicit And Non-Disclosure Agreements Allowed Under The FTC Rule

While the FTC's final rule imposes a near-blanket ban on non-compete agreements, it states that the rule does not prohibit certain other types of employment agreement clauses, including non-solicit and non-disclosure agreements , as these agreements "do not by their terms prohibit a worker from or penalize a worker for seeking or accepting other work or starting a business after they leave their job " , according to the FTC's final rule. Notably, the continued ability to use these agreements will provide companies with a measure of protection regarding their trade secrets (in the case of non-disclosures) and their client relationships (in the case on non-solicits), even as they are no longer able to enforce non-competes.

This allowance is particularly relevant for financial advisory firms, which historically have tended to use non-solicits much more often than non-competes in order to retain control over their client relationships (at least for the period in which the non-solicit is in force) when an advisor leaves for another firm or to start their own. Though , in reality, advisor non-solicit agreements can end up being quite messy given the challenge of determining whether an advisor is soliciting their former clients.

While the FTC has made it clear that non-disclosure and the more common (for financial advisors) non-solicit provisions remain permitted, the situation is less clear as it pertains to a "non-acceptance" clause in an employment contract. Unlike a non-solicit – which bars an employee from soliciting the clients of their former firm – a non-accept bars an employee from even accepting clients who choose to follow and pursue the advisor. Yet the FTC's definition of a non-compete itself is that a (no-longer-permissible) non-compete is one that "prohibits a worker from, penalizes a worker for, or functions to prevent a worker from… seeking or accepting work". Which means while a non-solicit is permitted, a non-acceptance clause that prevents an advisor from accepting a client who wants to engage them for work as a financial advisor may be deemed by the FTC as being 'too close' to a non-compete and therefore banned. Expect in the coming year, that either the FTC will put out additional guidance regarding non-accepts… or that an employer will try to impose one, an employee will sue to challenge it, and the courts will interpret whether or when a non-accept goes too far.

No More Non-Competes Means More (Messier) Financial Advisor Non-Solicit Agreements?

While non-compete agreements are less common than non-solicit agreements in the financial advice industry, those firms that do currently include non-compete clauses in their employment agreements could choose to add non-solicit clauses to protect their interest in holding on to clients after an advisor departs. Nevertheless, given the practical difficulty in enforcing non-solicit agreements (or more specifically, determining when they were actually violated in the first place), these firms (and perhaps some of those that currently attempt to enforce non-solicits?) could look to alternative ways to protect their interests when it comes to retaining clients when an advisor departs the firm.

The Challenge Of Enforcing Non-Solicit Agreements For Advisory Firms

While the language of individual non-solicit agreements can vary by firm, the basic idea is that an advisor who leaves the firm (often for another firm or to start their own) will not be allowed to solicit their previous firm's clients, typically for a set period of time (e.g., 1 year). Given the deep relationship created between advisors and their clients, non-solicits can help a firm retain the clients of a departing advisor by restricting the advisor's ability to reach out to their former clients to invite them to move with them to their new firm. The time period when the non-solicit is in force provides firms with the opportunity to transition the departed advisor's clients to a new advisor with the hope that the client will decide to stick with the firm once the non-solicit period ends (at which point the departed advisor has no restrictions on how they can communicate with their former clients).

Nonetheless, while potential violations of non-compete agreements typically are clear (i.e., it's relatively easy to tell whether an advisor has started working at a new firm or started their own), the lines are much blurrier when it comes to non-solicit agreements. For instance, because a solicitation can easily be made using private communication (e.g., the advisor calls or emails their former clients to invite them to join the advisor at their new firm), a firm that finds many clients leaving after the departure of an advisor might not know the exact circumstances: Did the advisor actively solicit them (which could be a violation of the non-solicit agreement), or did the clients find the advisor's new firm on their own, perhaps by searching online (which typically would not be a violation, as clients have the freedom to choose the firm and advisor with whom they want to work)? In such cases, the firm might choose to take legal action against their former advisor to determine whether they followed the guidelines of their non-solicit agreement (which can generate hefty legal bills for both parties in the discovery process of trying to determine whether the advisor really solicited or clients followed of their own volition!).

Furthermore, while certain actions (e.g., an advisor calling or emailing former clients inviting them to their new firm) are almost certainly likely to be seen as solicitations, other actions are murkier. For instance, it's common for advisors to announce career moves on their social media accounts (particularly on LinkedIn, which is built for this type of communication). Given that many clients might 'follow ' or be 'connected ' with their advisors on social media, they are very likely to see this change announcement… and then can find the advisor's new firm online and reach out to connect. However, it's unclear whether this would count as the advisor soliciting their former clients – after all, the advisor typically would be able to tell whether their clients follow their social media accounts – or merely the more benign (in terms of a potential non-solicit violation) result of the advisor simply making a 'public ' announcement via their social media accounts to reflect their new job for a wide range of consumers… that happens to include their former clients seeing the update based on their own online activity. All of which could ultimately create additional confusion for both firms and advisors (and potential legal challenges), particularly when the non-solicit agreement does not detail the infinitely varying ways an advisor could directly or indirectly "solicit " their former clients.

When an employee leaves a firm, it's not uncommon to offer a severance payment, with 'strings attached' to limit what the employee does to compete after they leave. If the firm did not already have a non-compete or non-solicit in place, one alternative approach is the use of a "Garden Leave" policy, which keeps the employee on the payroll but away from the office and their employment duties… effectively paying them to 'sit out' for a period of time. In the context of financial advisory firms, Garden Leave policies become a way to prevent the advisor from competing during the Garden Leave period (allowing the firm more time to pursue existing clients before the advisor can set up with a new firm). And notably, to the extent that a Garden Leave policy entails keeping the employee on payroll, it does not appear to violate the FTC's ban on non-competes (which only apply to post-employment restrictions, not while-the-employee-is-still-employed restrictions). On the other hand, a Garden Leave policy is typically negotiated (or at least, offered and chosen to be accepted) by the employee at the time they give notice, which means they cannot be mandated and firms thus can't necessarily rely on them as a non-compete alternative. Nonetheless, to the extent the firm was going to pay severance anyway, Garden Leave provisions are likely to become more common amongst advisory firms in the wake of the FTC ban as at least one approach for the advisory firm to buy itself more time to retain the clients of a departing advisor (if the advisor is willing to accept the Garden Leave income payment in exchange for agreeing to sit out!).

Does The Exemption For Sales Transactions Make Small Partnership Equity Stakes Less Attractive For Financial Advisors?

Under the FTC's initial proposal for the non-compete ban, the exemption that would have allowed a non-compete to remain in place in the case of the sale of a business (or an individual's ownership interest in the business ) would only have applied to individuals with at least a 25% ownership stake company. However, this minimum was eliminated in the final rule, such that any ownership stake in a business can still potentially have a non-compete provision attached to its sale.

As a result, partners in advisory firms with even 'small ' ownership stakes (e.g., 2% or 1% or even less) could still find themselves subject to a non-compete agreement if their firm is sold , or even if they want to leave the firm and sell their equity stake back (whereas non-owner employees would be free to leave without any non-compete obligations).

Which means that going forward , financial advisors being offered ownership in their firms might not only evaluate whether the equity (e.g., shareholder) agreement includes a non-compete clause (and how long it lasts ), but also consider whether receiving equity (and the proceeds from a potential sale) are worth the risk that they could become tied to the firm for a certain period in case of a sale. Especially since even if there are no non-compete restrictions in the current shareholder agreement (e.g., in the case of selling shares back to the firm), they could still be imposed as a contingency from a future buyer … and one that a 'small ' partner might not be able to exert significant influence on to change the terms of the sale if they only have a small ownership stake but don't necessarily want to be the one who 'blows up ' the deal for everyone by refusing to sign?

On the other hand, for advisory firms themselves, the M&A exemption might make offering at least small equity stakes to senior advisors more attractive, as it could serve as a way to discourage the advisors from leaving (by requiring a non-compete if the advisor leaves and sells back their stake to the company) , and moreso could make a firm more attractive to potential buyers (who, in the current competitive environment for advisor talent, will likely be looking to retain the selling firm's advisors along with its client base), as they could require non-competes for advisors who are equity owners as a term of the sale in a way that couldn't be done if those senior advisors were 'just ' key employees.

Notably, ownership-related non-compete agreements are far more feasible to be used in the RIA channel than amongst advisors working for broker-dealers. The reason is that the RIA structure more easily allows for shared ownership of the business entity itself (e.g., through partnership interests) that can actually be sold, whereas in broker-dealers advisors are representatives of the broker-dealer but don't own the B/D directly. As a result, when one broker "sells" and transitions to another firm, revenue that is shifted via changes in the broker-of-record, or by establishing a split rep code between the departing and successor brokers, have not engaged in a "bona fide sale" of an actual ownership interest… limiting the ability of a broker buying from another to impose a non-compete when taking over that broker's book of clients.

Potential Next Steps For Advisory Firms And Their Advisors In The Wake Of The FTC Ban On Non-Competes

With the effective date for the FTC's non-compete ban coming in September 2024, both advisory firms and their financial advisors might be considering their options to protect their respective interests. While firms that include non-compete clauses in their employment (and advisors subject to them) will face the most direct consequences of the FTC's final rule, other firms might consider whether their current agreements (e.g., non-solicits) are clear in their terms (e.g., what counts as a solicitation) and meet the desired balance of protecting the firm's interests while not being so onerous that they discourage financial advisors from joining the firm.

Review Your Financial Advisor Employment Agreement

Given that an advisor might have joined their firm years, or even decades, ago, they might not be fully aware of the non-compete, non-solicit, or other obligations included in their employment agreement. While firms will be required under the FTC rule to provide written notice to relevant workers letting them know that their non-compete agreements are unenforceable and will not be enforced , advisors should still consider reviewing their agreements to determine whether other (e.g., non-solicit) obligations apply. Further, because the FTC's rule doesn't go into effect until September (and is subject to legal challenges), advisors leaving their firms before that time (or if the courts halt the implementation of the FTC's non-compete ban) could still be subject to the terms of the non-compete (and therefore need to wait until the rule goes into effect).

In addition, for advisors who are considering leaving their firms in the wake of the FTC's ban on non-competes, an understanding of their other obligations (e.g., non-solicits, confidentiality provisions that bar them from taking client information when leaving) under their employment agreement could help prevent conflict (and potential legal action) with their firm. And given the sometimes messy nature of enforcing these agreements (e.g., what counts as a solicitation), consulting with a legal advisor who specializes in the financial advice industry (e.g., Beach Street Legal , RIA Lawyers , or Brightstar Law Group ) could help ensure that the transition away from the firm goes as smoothly as possible.

An Impetus For Advisory Firms To Build Stronger Team Cultures

While non-compete agreements could be used to protect a firm's interest in holding onto clients following the departure of their advisor, they also discouraged advisors from leaving in the first place, as they would either have to 'sit out ' the length of the non-compete or find a job in a different field. After the FTC's ban goes into effect, advisors previously subject to non-competes will find themselves with significantly more flexibility in leaving their current employer, suggesting that firms might consider other ways to keep advisors (and their clients) with the firm.

While firms could protect their interests through non-solicit agreements with their advisors (though current advisors might need to be incentivized to accept new agreements after their non-compete is no longer enforceable, if a non-solicit wasn't already present? ), or increase their equity ownership program to increase the number of advisors with ownership stakes (that include non-compete clauses if the equity is sold back to the firm), another option is to build a stronger firm culture so that advisors do not want to leave in the first place. In fact, the FTC outright noted one of the reasons they viewed the non-compete ban as valid is that "in a well-functioning labor market, employers compete to retain their workers by improving working conditions " and "that firms that are concerned about retention have tools other than non-competes for retaining workers, including… competing on the merits to retain the worker's labor services " without 'needing ' a non-compete. With the caveat that that means advisory firm owners will have to be more cognizant about how to actually make their advisory firms a more desirable place to work to 'compete ' in the open marketplace!

Potential ways to do so include designing compensation models that motivate employees to perform well and stay with the firm (which could include equity ownership), offering benefits and perks that have been shown to attract and retain employees , designing career tracks that show employees how they can advance in their career at the firm, and/or creating a culture of appreciation to ensure employees feel recognized for their accomplishments (notably, steps such as these could help firms improve employee retention whether or not they currently use non-competes!).

The key point, though, is simply that many advisory firms don't use or rely upon non-competes because they try to create advisory firms and platforms that advisors wouldn't want to leave in the first place. But with the FTC's ban on non-competes, that approach shifts from a "best practice " to a more substantive requirement just to attract and retain advisor talent in the first place!

Crafting More Equitable Non-Solicits As Their Use Rises?

Non-solicit agreements have already become increasingly prevalent among independent advisory firms as more and more hire 'employee' service advisors to provide advice to existing client relationships that are 'handed off ' to them. And the use of non-solicits will likely become even more popular in the wake of the FTC non-compete ban (at the least because firms previously using non-competes will likely still want to put something in place). Which means the terms of these non-solicit agreements will come into greater focus , such as whether a non-solicit agreement covers all of an employee advisor's clients, or only certain ones.

For instance, while it might be clear that the firm 'owns ' the relationship with a client that the firm brought on itself and passed on to the advisor (thereby perhaps warranting a stricter non-solicit agreement), it would seem inappropriate to restrict an advisor from soliciting certain other clients (e.g., a personal friend or relative/family member that they brought in the first place) to their new firm.

In addition, there is also a fuzzy middle where it is less clear who owns the goodwill equity of the client relationship (e.g., if a firm brings in a prospect through its marketing, but the advisor 'closes the sale ' and brings the individual on as a client, or the advisor brings in the prospect but does so using some of the firm's marketing resources or by leveraging its known brand in the local community). In these cases where the client is effectively a 'joint ' client of both the firm and the advisor, it might be appropriate for the firm and the advisor to negotiate the specifics of how these client relationships will be handled under the firm's non-solicit agreement.

Rather than creating a blanket non-solicit agreement that covers all of an advisor's clients (from a relative to a client 'given ' to them by the firm) in the same manner, another option is to craft an agreement that recognizes the "yours, mine, and ours " split of client relationships , allowing firms and advisors to set the terms for how those different types of client relationships will be handled in the event that there is ever a split (from which clients can be solicited or not, what client information can be taken or not, and whether compensatory payments are due back to the firm or not).

Download the Advisor/Client Relationship Equitable Split (ACRES) Agreement Template

For instance, advisory firms can use ( and/or modify) the Advisor/Client Relationship Equitable Split (ACRES) Agreement template to their specifications (though firms and their advisors might choose to seek legal counsel for more complicated situations). Which not only creates a fairer delineation of the clients an advisor can solicit if they leave the firm (and help prevent the need for legal action ), but can also build greater trust between the firm and their advisors by working together to come to an agreement that respects both sides' interests!

Ultimately, the key point is that the FTC's ban on non-competes will provide advisors subject to non-competes with increased flexibility to move amongst firms within the financial advice industry, and also offers the opportunity for both financial advisory firms and their advisors to revisit their employment agreements not only to ensure that they comply with the FTC's final rule, but also that they better meet the needs of both parties. In addition, the non-compete ban could inspire firms to explore other ways to retain their advisors (and their clients), whether by drafting more equitable non-solicit agreements, offering more attractive employee value propositions, and/or building a firm culture that encourages advisors (and their clients) to stay with the firm for the long haul!

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Former CIA Officer Pleads Guilty to Conspiracy to Commit Espionage

Alexander Yuk Ching Ma, 71, of Honolulu, a former Central Intelligence Agency (CIA) officer, pleaded guilty today to conspiring to gather and deliver national defense information to the People’s Republic of China (PRC).

According to court documents, Ma and a blood relative of his (identified as co-conspirator #1 or CC #1) were naturalized U.S. citizens who were born in Hong Kong and Shanghai, respectively. Both Ma and CC #1 worked for the CIA — CC #1 from 1967 until 1983, Ma from 1982 until 1989. As CIA officers, both men held top secret security clearances that granted them access to sensitive and classified CIA information, and signed non-disclosure agreements that required them to maintain the secrecy of that information.

As Ma admitted in the plea agreement, in March 2001, when he no longer worked for the CIA, at the request of intelligence officers employed by the PRC’s Shanghai State Security Bureau (SSSB), Ma convinced CC #1 to meet with SSSB intelligence officers in a Hong Kong hotel room. Over the course of three days, Ma and CC #1 provided the SSSB with a large volume of classified U.S. national defense information. At the conclusion of the third day, the SSSB intelligence officers provided CC #1 with $50,000 in cash, which Ma counted. Ma and CC #1 also agreed at that time to continue to assist the SSSB.

As detailed in the plea agreement, in March 2003, while living in Hawaii, Ma applied for a job as a contract linguist in the FBI Honolulu Field Office. The FBI, aware of Ma’s ties to PRC intelligence, hired Ma, as part of an investigative plan, to work at an off-site location where his activities could be monitored and his contacts with the PRC investigated. Ma worked for the FBI from August 2004 until October 2012.

Ma further admitted that in February 2006, during this monitored employment by the FBI in Honolulu, Ma convinced CC #1 to provide the identities of at least two individuals depicted in photographs that were provided to Ma by SSSB intelligence officers. The individuals’ identities were and remain classified U.S. national defense information. Ma confessed that he knew that this information, and the information communicated in March 2001, would be used to injure the United States or to benefit the PRC, and he deliberately engaged in the criminal conspiracy with CC #1 and the SSSB anyway.

Under the terms of the parties’ plea agreement, Ma must cooperate with the United States, including by submitting to debriefings by U.S. government agencies. The plea agreement, if accepted by the Court, calls for an agreed-upon sentence of 10 years in prison. Sentencing is set for Sept. 11.

Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division, U.S. Attorney Clare E. Connors for the District of Hawaii, Assistant Director for Counterintelligence Kevin Vorndran of the FBI, and Special Agent in Charge Steven Merrill of the FBI Honolulu Field Office made the announcement after Chief U.S. District Judge Derrick K. Watson conducted the change of the plea hearing.

The FBI Honolulu and Los Angeles Field Offices investigated the case.

Assistant U.S. Attorneys Ken Sorenson and Craig Nolan for the District of Hawaii, and Trial Attorneys Scott Claffee and Leslie Esbrook of the National Security Division’s Counterintelligence and Export Control Section are prosecuting the case.

Sony, Paramount Sign Non-Disclosure Agreement, but $26 Billion Bid Likely Off the Table

T he longer the Paramount sale process drags out, the less likely it appears any major transactions surrounding the company will take place.

The merger and acquisition talks surrounding Paramount Global continue, but the company’s options are beginning to narrow. The first company to make a meaningful pursuit of Paramount was David Ellison’s Skydance, and when the two sides entered an exclusive negotiating period in April, many observers thought a deal was just a matter of time. During that window, Sony teamed up with the private equity firm Apollo Global Management to craft a $26 billion all-cash bid , in case Paramount and Skydance’s talks came to naught. Since the exclusive window with Skydance has lapsed, Paramount’s board has been considering the Sony/Apollo offer and, a new report from Bloomberg , it appears that things are moving forward as the two sides have signed a non-disclosure agreement. However, there are increasing signs that the Sony and Apollo offer could be significantly modified, and Paramount may simply decide the process has become too complex and take itself off the market for the foreseeable future.

Key Details:

Sony only wants Paramount’s movie studio and would have to sell off big parts of the company to satisfy regulators.
Paramount controlling shareholder Shari Redstone preferred the Ellison deal, but it was a non-starter with other company shareholders.
Ellison has already sweetened Skydance’s offer for Paramount, and may not have a better deal to put on the table.

For a limited time, get 50% off a year of Paramount+ With Showtime with Code: THECHI .

The signing of a non-disclosure agreement is an important step for Sony and Paramount. It means that the two sides can now get a look at each other’s books, and determine if moving forward with a sale of Paramount assets to the two companies makes financial sense. It is not a binding agreement to sell the company, but a key step in the due diligence necessary in an M&A process.

Various reports have indicated for weeks that even if Sony did buy 100% of Paramount, it would be most interested in the company's movie studio and intellectual property (IP). Indeed, Sony would likely have to divest itself of at least some TV assets owned by Paramount, since as a Japanese-based company, it’s not legally allowed to own an American broadcast channel like CBS . Sony reportedly would also want to ditch Paramount’s flagging cable channels as well as its streamers Paramount+ and Pluto TV , and Apollo’s main interest is in the real estate involved in Paramount’s storied Hollywood lot. The private equity firm wouldn’t be able to take control of CBS in a deal, as it would run up against a legally-mandated cap on how much reach one broadcaster is allowed to own thanks to its majority ownership stake in Cox Media Group.

Last week, reports emerged that Sony and Apollo were “rethinking” their bid . Now, Deadline is reporting that this could entail a smaller bid , one that won’t involve a purchase of the entirety of Paramount Global. That would spare the buyers having to sell off enough of Paramount’s TV assets to get approval for the deal from federal regulators.

Will Paramount Have to Go It Alone?

Paramount’s controlling shareholder Shari Redstone has wanted out of the company for months and preferred the Skydance/deal because it kept the company together and she stood to make billions in the process. Paramount’s other shareholders were highly dubious of the offer , to say the least, and many felt it rewarded Redstone at their expense.

Ellison has already sweetened the offer once in hopes of closing a deal, but it was still not enough to gain the approval of Paramount’s board. Redstone reportedly doesn’t want to simply jam through a deal no matter what; the feelings of other Paramount shareholders are important to her, as is trying to preserve the company her father Sumner Redstone spent decades building.

The signs are increasing that Paramount will simply be left to go it alone for a while. The company has seen good progress from Paramount+, which grew by 3.7 million customers in the first quarter and now has 71.2 million overall. But it no longer has a CEO thanks to the departure of Bob Bakish, and its three-headed “Office of the CEO” who could find themselves trying to figure out Paramount’s next steps if it finds itself without an M&A partner.

Paramount Plus

Paramount+ is a subscription video streaming service that includes on-demand access to 40,000+ TV show episodes from BET, CBS, Comedy Central, MTV, Nickelodeon, Nick Jr. and more. The lineup includes “1883,” “Tulsa King,” “Star Trek: Discovery,” Nickelodeon’s “SpongeBob SquarePants,” and “PAW Patrol.” Subscribers can watch the NFL, college football, The Masters, college basketball, UEFA Champions League, UEFA Europa, Serie A, and NWSL. The service also offers the option to watch your live CBS affiliate. The upgraded ad-free package includes premium movies and shows from Showtime.

Subscribers can choose between the Essential Plan (which includes ads) for $5.99/month, or go commercial-free and add more movies with Paramount+ with SHOWTIME for $11.99/month.

Subscribers to the more expensive plan will also get access to your local CBS affiliate to stream your local news, prime-time lineup, and late-night. You will also be able to download offline and watch select shows in 4K.

With the lower-cost “Essential” plan, you will still be able to watch live NFL games, Champions League, and national news – but you will no longer get your local CBS affiliate.

With their new app, enjoy advanced recommendations, curated homepages, and new content categories while still being able to stream major live sports like NFL , College Football , College Basketball . Sports fans will also appreciate the service’s inclusion of NFL on CBS, PGA Tour, along with every match of UEFA Champions League and Serie A.

The service was previously called CBS All Access.

Sony, Paramount Sign Non-Disclosure Agreement, but $26 Billion Bid Likely Off the Table

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Sony and Apollo Take Key Step in Bid for Paramount’s Assets

The two companies have expressed interest in acquiring the media conglomerate, but are backing away from their $26 billion all-cash offer.

The arched gate to Paramount Pictures, framed by palm trees. A plaza with a fountain is in the foreground.

By Benjamin Mullin and Lauren Hirsch

Sony Pictures Entertainment and Apollo Global Management have taken a significant step forward in their effort to court Paramount, three people familiar with the matter said on Friday.

The two companies have signed nondisclosure agreements with Paramount, allowing them to look at Paramount’s nonpublic financial information, said the people, who spoke on the condition of anonymity to discuss active negotiations. Paramount previously shared materials with another suitor, the Hollywood studio Skydance.

Early this month, Sony and Apollo sent Paramount a nonbinding expression of interest in acquiring the company for $26 billion. The two had been seeking to buy Paramount for its studio and then sell off other parts of its empire, which includes CBS, cable channels like MTV and the Paramount Plus streaming service.

But Sony’s shareholders have fretted over the possible acquisition, given the potential cost of a bid for Paramount and the headwinds facing the subscription streaming business. Sony and Apollo are now contemplating a variety of approaches to acquire the company’s assets, but are backing away from their plan to make an all-cash, $26 billion offer for Paramount, two of the people said.

Sony’s new vision for a deal could alter the dynamics of Paramount’s effort to sell itself or merge with another company. Paramount previously rebuffed Sony’s offer to buy just its studio, and Paramount’s controlling shareholder, Shari Redstone, has long sought a deal for the entire company.

A person familiar with Ms. Redstone’s thinking has said that a breakup of the company is not a deal breaker, depending on the terms, but that she prefers to keep Paramount intact.

Ms. Redstone has blessed a deal to sell her stake in National Amusements, Paramount’s parent company, to Skydance, but Skydance’s bid for the entire company has faced significant pushback from Paramount’s common shareholders.

Paramount let an exclusive negotiation window with Skydance lapse in recent weeks, but the two are still talking, and Skydance remains interested in a deal.

The deal talks are happening at a tumultuous time for Paramount. The company’s chief executive, Bob Bakish, stepped down last month after more than a quarter-century at the company. He was replaced in the interim by three executives running an “office of the C.E.O.”: George Cheeks, the chief executive of CBS; Chris McCarthy, the chairman of Showtime and MTV Entertainment Studios; and Brian Robbins, the chief executive of Paramount Pictures.

Benjamin Mullin reports on the major companies behind news and entertainment. Contact Ben securely on Signal at +1 530-961-3223 or email at [email protected] . More about Benjamin Mullin

Lauren Hirsch joined The Times from CNBC in 2020, covering deals and the biggest stories on Wall Street. More about Lauren Hirsch

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Free Business Plan Non-disclosure Agreement Template
A business plan non-disclosure agreement, also known as a confidentiality agreement or an NDA, is designed to build trust in your business relationships. By learning from the beginning what type of information is confidential, you can safely explore all private aspects of your business venture. Avoid accidental leaks by clarifying that your ...
PDF Business Plan Non-disclosure and Confidentiality Agreement
Confidential Information is excluded from the obligations of confidentiality under this Agreement pursuant to Paragraph 2 above. 4. Non-Disclosure of Transaction. Without Disclosing Party's prior written consent, neither Receiving Party nor its Representatives shall disclose to any other person, except to the extent, the provisions of
Business Plan Non-Disclosure Agreement (NDA)
A business plan non-disclosure agreement (NDA) allows someone to share a business plan without fear of a third party using it for their own benefit. Business plans are highly confidential, especially detailing a marketing strategy with a different approach to a specific market. An NDA makes the shared party liable if the plan is used for anyone ...
Business Plan Non-Disclosure Agreement (NDA)
The business plan non-disclosure agreement is intended for use when sharing a business plan with consultants, investors, contractors, potential employees, and anyone else evaluating your planned enterprise. Regardless of the size or complexity of your plan, it is likely to include confidential information that hopefully gives you an advantage over competitors.
PDF BUSINESS PLAN NON-DISCLOSURE AGREEMENT & GUIDE
Business Plan Non-Disclosure Agreement Instructions The following provision-by-provision instructions will help you understand the terms of your business plan non-disclosure agreement. The numbers and letters below (e.g., Section 1, Section 2(c), etc.) correspond to provisions in the
Business Plan Non-Disclosure Agreement Template
A business plan non-disclosure agreement is a document intended to protect private information about your business plan.It notifies the other party that you intend to share confidential information. It lays out potential penalties that the other entity, often a company or a potential business partner, will have to pay if they disclose information about your business plan.
Free Non-disclosure Agreement Templates
Free non-disclosure agreement templates. Secure your confidential information and foster trust in your business relationships with our attorney-drafted non-disclosure agreement (NDA) templates. Whether you're sharing proprietary information with partners, collaborators, or potential investors, ensure confidentiality and protection with non ...
Free Non-Disclosure Agreement (NDA) Template
The primary difference between a non-compete and a non-disclosure agreement is the business activities they intend to restrict. A non-compete agreement prohibits one party from doing business that competes with the other party.For instance, it prevents one party from hiring the other's employees and business contacts and working with competing companies.
Free Non-Disclosure Agreement (NDA) Template
A non-disclosure agreement (NDA) is a legally binding contract designed to protect confidential information from being disclosed. Commonly employed in business contexts, NDAs are used when a new employee, potential investor, or partner gains access to sensitive information. This legal instrument fosters collaboration and trust among businesses ...
Free Business Plan Non-Disclosure Agreement
A business plan non-disclosure agreement (NDA) is a form used by businesses to permit a 3rd party (be it a person or company) to view their business plan without the fear of the 3rd party sharing the contents of their plan with other entities. Business plans contain a massive amount of information regarding the disclosing company. The document typically includes financials, pricing, short and ...
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The business plan non-disclosure agreement is a document that restricts any individual from divulging proprietary information that is shared through a business plan. Lets say for example, that an entrepreneur is starting a new company and would like to run their idea by a colleague or friend, the only legal way for that business plan to be kept ...
Sample Confidentiality Agreement (NDA)
Fact-Checked. A confidentiality agreement—also called a "nondisclosure agreement" or "NDA"—is a legally binding contract where a person or business promises to treat specific information as a trade secret and promises not to disclose the secret to others without proper authorization. NDAs are sometimes used in other civil cases, such as ...
How to Write an NDA: Step-by-Step Guide & More
A business plan non-disclosure agreement will come in handy here, as it will keep the details of your business plan secure after you pitch to investors. This type of NDA can also be helpful for startups that need to show a third party the details of their business plan to receive funding, for instance. 7. Business sale NDA
Understanding Business Plan Non-Disclosure Agreements (NDA)
What is a Business Plan Non-Disclosure Agreement. A Business Plan Non-Disclosure Agreement, also known as a Confidentiality Agreement or NDA, is a legal contract that aims to protect the confidential and proprietary information shared in the plan from being disclosed or used by third parties without authorization.
PDF Business Plan Non-Disclosure Agreement Template
The Recipient shall only disclose the Business Plan and Confidential Information to persons within their organization on a need-to-know basis. Each person who becomes privy to the Confidential Information shall be bound by the provisions within this Agreement. This Agreement shall survive and continue after any expiration or termination of this ...
Share business plan by using NDA agreement
Enter the Non-disclosure agreement (NDA) Since business plans often reveal the heart, soul and secrets of a business, you probably want to make sure that anyone that you share your business plans with will keep your information confidential. One of the legal tools that you may find useful to help you achieve protection for your sharing of ...
Non-Disclosure Agreement
A Non-Disclosure Agreement (NDA) is a binding contract that requires all signing parties to keep specific information confidential. Non-Disclosure Agreements are common in business and professional settings. When a recipient of confidential information signs an NDA, it creates a written record that they agree to not reveal the specified information to any unauthorized people or organizations.
Non Disclosure Agreement Form
A non-disclosure agreement (NDA), also known as an NDA or a confidentiality agreement, is a contract that prevents one party from releasing secret information binds a recipient of secret information, including trade secrets or proprietary business information, to outside parties. If the party violates the non-disclosure agreement, they could be ...
Non-Disclosure Agreement (NDA) Explained, With Pros and Cons
Non-Disclosure Agreement - NDA: A nondisclosure agreement (NDA) is a legal contract between two or more parties that signifies a confidential relationship exists between the parties involved. The ...
Using an NDA when you're building a business plan
A nondisclosure agreement states that your business will give an individual or another business information that they agree to keep secret. If the agreement is breached, you can seek compensation. Using an NDA signals that the information you're sharing is private and critically important to your business. An NDA is usually one-sided, meaning ...
Non-Disclosure Agreement (NDA) Template
Non-disclosure agreements are legal contracts that prohibit someone from sharing information deemed confidential. The confidential information is defined in the agreement which includes, but not limited to, proprietary information, trade secrets, and any other details which may include personal information or events. ... Business Plan NDA ...
What Is A Business Plan Non-Disclosure Agreement?
A business plan Non-Disclosure Agreement (NDA) is a binding document that prohibits parties from disclosing certain information to third parties.. In other words, when you give people access to certain information, getting them to sign an NDA means they cannot share that information with anyone else, protecting your confidential information.
Financial Advisor Non-Solicits & Non-Competes Under FTC Ban
Non-compete agreements are common around the business world and are often used to dissuade companies from 'poaching ' another's employees, and/or to prevent employees (at least for a certain time period) from taking the knowledge gained from working at one company to a competitor. Which can allow companies to protect the 'investments ' they have made in their employees (e.g., training on ...
Office of Public Affairs
Both Ma and CC #1 worked for the CIA — CC #1 from 1967 until 1983, Ma from 1982 until 1989. As CIA officers, both men held top secret security clearances that granted them access to sensitive and classified CIA information, and signed non-disclosure agreements that required them to maintain the secrecy of that information.
Sony, Paramount Sign Non-Disclosure Agreement, but $26 Billion ...
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Sony and Apollo Take Key Step in Bid for Paramount's Assets
The two companies have signed nondisclosure agreements with Paramount, allowing them to look at Paramount's nonpublic financial information, said the people, who spoke on the condition of ...
Red Lobster files for bankruptcy
It plans to sell its business to its lenders, and in turn, it will receive financing to stay afloat. ... who spoke under the condition of anonymity because of a non-disclosure agreement with the ...
DOCX Business Plan Non-Disclosure Agreement Template
A. Non-Disclosure. The Recipient understands and agrees to not use or disclose the Business Plan or Confidential Information for personal benefit or the benefit of any other person, corporation, association, company or entity, and shall take all steps necessary to protect Confidential Information from disclosure.