Non-Disclosure Agreement Cost

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What does a non-disclosure agreement cost? A company that needs to protect sensitive information may ask this question. Let’s explore non- disclosure agreement costs and review some general information about non- disclosure agreements and how they work.

How Much Does a Non-Disclosure Agreement Cost?

A non-disclosure agreement, often referred to as an NDA or a confidentiality agreement, is legal contract that provides one or both parties with confidentiality. Once signed, the content that is the subject of the agreement cannot be shared with third parties.

Non-disclosure agreements are common in the business world and are often used in the following situations:

  • To protect information about products when a company enters the sale or licensing of a product or technology.
  • When hiring a new employee to ensure proprietary information is not shared during employment or after employment ends
  • During negotiations with a new partner or investor
  • To inform new clients what sensitive information cannot be shared
  • During mergers and acquisitions to protect the financial and operational information of both companies.

Non-disclosure agreements are vital documents and serve to protect a business’s sensitive information like trade secrets, client lists, or financial information. Many companies who need a non-disclosure agreement seek the help of a qualified lawyer to draft this legally binding document.

An attorney who has experience with non-disclosure agreements will know how to draft a comprehensive contract that protects all the company’s interest and can be upheld in court if a dispute arises.

According to ContractsCounsel’s marketplace data, the average cost of a project involving a non-disclosure agreement is $285.

What’s Typically Included in a Non-Disclosure Agreement

Non-disclosure agreements are easily customized to fit the needs of the business and the specific information that is protected under the contract. A basic non-disclosure agreement should include the following information:

  • Party Identities. Both parties to the agreement should be named and the agreement must identify which party is disclosing information and which party is bound by confidentiality. If it is a mutual non-disclosure agreement, this should be stated.
  • Definition of Confidential Information. The non-disclosure agreement should include a clear list of the information that is protected by the agreement. To be legally enforceable, the non-disclosure agreement should be very specific. Rather than using a vague term like “proprietary information” the contract should cover specific details of the information covered. Each party needs to fully understand what information cannot be shared.
  • Obligations. Under a non-disclosure agreement, both parties will have obligations they must abide by to keep the information secure.
  • Exclusions from Confidentiality. Some company information is public knowledge or was previously shared by the parties. Any exclusions to the confidential information should be listed.
  • Consequences and Remedies. If either party breaches this agreement, they can expect that they will face consequences which could include payment for damages or litigation.
  • Time Frame. Most non-disclosure agreements have an expiration date or include the number of years that sensitive information must be kept confidential.
  • Return of Information. If a non-disclosure agreement involves any documents or technology, the agreement may require that this information is returned when the party’s business together is completed.

If you aren’t sure what your non-disclosure agreement should include, it is best to consult with an experienced attorney. Attorneys who specialize in non-disclosure agreements will know exactly what your contract should include based on your business and the type of information you would like to protect.

Types of Non-Disclosure Agreements

The two types of non-disclosure agreements are unilateral non-disclosure agreements and mutual non-disclosure agreements.

  1. Unilateral non-disclosure agreements are non-disclosure agreements that only protect the confidential information of one party. One common example is an employee non-disclosure agreement. In this contract, the employer is the protected party and the employee is agreeing to keep any sensitive information confidential.
  2. Mutual non-disclosure agreements protect the confidentiality of both parties. Mutual non-disclosure agreements are used during mergers and acquisitions. It is common to need to look into the financial information or other sensitive documents of each company before coming to an agreement. If the agreement falls through, both companies are protected from having their sensitive information disclosed to third parties.

Are Non-Disclosure Agreements Enforceable?

When drafted correctly, non-disclosure agreements are legally binding and enforceable. If the signing party breaches this contract, the disclosing party can file a lawsuit to recover any damages suffered due to the breach of contract.

In most cases of a breached non-disclosure agreement, the court will issue an injunction that prohibits the party from continuing to disclose sensitive information against the non-disclosure agreement.

Once the harmful actions have ceased, the court can assess the damages that the disclosing party has suffered because of the breach of the non-disclosure agreement.

A knowledgeable attorney can help draft a non-disclosure agreement that is specific and legally binding so your company will be protected from damages in the event of a breach of non-disclosure agreement case.

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Non-Disclosure Agreement Drafting Service

Non-disclosure agreements are essential documents for any company that needs to protect sensitive information like trade secrets, client lists, or intellectual property. It is recommended that a company hires an attorney to draft this crucial contract.

If you hire a lawyer to draft your non-disclosure agreement, you will meet with the lawyer to discuss your business needs and what you need to protect. The lawyer will then draft a custom non-disclosure agreement that you can use with your clients, employees, or business partners.

Non-Disclosure Agreement Review Service

Non-disclosure agreement templates can be found online, and it is possible to draft your own agreement. If you choose to go this route, it is still recommended that you hire a lawyer to review your non-disclosure agreement before putting it into use.

Depending on your jurisdiction, the requirements for non-disclosure agreements may vary. Your online template may not include all necessary information which could result in your non-disclosure agreement being overruled in court if there is a dispute. A knowledgeable attorney can read over and edit your existing agreement to ensure it is legally binding and is best suited to protect your business.

Drafting Non-Disclosure Agreement Costs

Hiring a lawyer to draft a non-disclosure agreement will come with costs. The lawyer will charge for any time spent working on the agreement which can include consultations and revisions.

ContractsCounsel’s marketplace data shows the average non-disclosure agreement drafting costs are $325 across all states and industries.

Non-Disclosure Agreement Review Costs

Review services will also incur legal fees because the lawyer will use their time and legal expertise to ensure your non-disclosure agreement abides by all state and local laws and will be enforceable if necessary.

According to ContractsCounsel’s marketplace data the average non-disclosure agreement review costs are $285 across all states and industries.

How Do Lawyers Charge for Non-Disclosure Agreements?

Hourly Rates for Non-Disclosure Agreements

When a lawyer uses an hourly rate fee agreement, they bill their client for the number of hours a case or project takes at a set hourly rate. The hourly rate should be communicated to the client before any work is done. The lawyer can also bill for any work done by their employees like paralegals or office staff.

ContractsCounsel’s marketplace data shows the average hourly rate for a non-disclosure agreement lawyer ranges from $200 - $350 per hour.

Flat Fee Rates for Non-Disclosure Agreements

When using a flat fee rate structure, the lawyer will assess the task then provide the client with a flat fee to complete the job. Clients tend to like this fee arrangement because they know exactly what they need to budget for legal fees.

ContractsCounsel's marketplace data shows that the average flat fee rate for a non-disclosure agreement is $285.

Get Help with a Non-Disclosure Agreement Project

Do you need help with a non-disclosure agreement? If so, post a project in ContractsCounsel’s marketplace to receive flat fee bids from business lawyers to handle your project. All lawyers on the ContractsCounsel’s platform are vetted by our team to make sure you are provided with top tier service.

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