Unlocking the Power of Digital Signature Licitness for Interview Non-Disclosure

How to eSign a document: digital signature licitness for Interview Non-Disclosure

issue about the types of documents you will see sometimes when you are considering a business relationship meaning you have not yet actually entered into a contract but you're exploring your options in terms of whether there is a business interest and how to move forward with the parties the issue that comes up is many times or you know this evaluation process requires an exchange of confidential information so the parties want to make sure that when they exchange the confidential information that it remains confidential and that when the evaluation of each other has concluded and specifically if they decide not to go forward with a business arrangement that the confidential information will be destroyed and/or returned back to the original provider so this document is is an attempt to do that and this is not to say this is the document that should be used and we're not offering any legal advice or suggesting you use this document this document is here for discussion and evaluation purposes similar to the other two documents in the other video where we looked at the so-called full corporate office and full corporate offer and the letter of intent so this non-disclosure non circumvent agreements sometimes is is referred to as ncnd the abbreviation ncnd and are in sandy md CA I mean you know lots of little different names for this sometimes just called non-disclosure agreement NDA and it's the first thing that comes out when two companies are considering discussions so these are very common and it typically will go well we should talk about this I think we've got something we should explore okay well good well my legal depart get a MCM ddu and and we'll get that sign next week and then we'll sit down and talk about this that sounds great okay let's do that so so this is the kind of document something like this this type would normally you be floated around for for signature by all the parties so just to take a look at some of the language in here again this is uh this is a sandy dealing with a potential oil deal in Russian Russian oil repco Russian export blend crude oil and there are three parties involved ABC so all the actual names of the party have been removed and you'll notice right here at the beginning the type of legal entity is different so incorporation which would be a u.s. LLC which could be anything could be a probably a US company here and an srl would be a foreign corporate entity but collectively and individually collectively referred to as the parties and individually as the party so typically in many agreements and even contracts you will see some language up front and sometimes the language is preceded by the word whereas and and it's designed really to kind of set the stage for the document always why are the parties entering into this document and it precedes the the normal substantive provisions of the contract and sometimes there's discussion where there's any actual legal impact any legal significance to this language but it certainly can be argued that by having language like this it sets the context for the agreement as well as the giving some idea of the intent of the parties as to what this document is is to do so I think it certainly gives a argument to those who feel they want to use it to interpret the agreement so again this is a confidentiality agreement so the first thing we have in this agreement is as in many documents you have a definitional section and here the definition is relates to confidential information and the obligation to keep it confidential so here if you look at this definition it's extremely broad and parties agree information disclosed or earlier or in writing or made available by the other party to another party including but not limited to and then they list all all the possible types of confidential information so you know obviously what is in this definition will differ based on the nature of the transaction or it could be different this is intended to be fairly all-encompassing but you want to make sure that if there's anything specific to your business discussions where information will be exchanged or data or whatever that it that is included in this list of information and you see trade secrets strategic plans and vention plans customer information banking and financial information etc and all other material whether written or oral tangible or intangible shall be deemed confidential information now the problem is you know if you are receiving confidential information you want to know that what you have received is confidential in other words you don't want to have people talking and exchanging information and then three months later they tell you oh you know by the way that chart we gave you three months ago is confidential and and you didn't know that so you want to make sure there's a provision here that says that they tell you it's confidential and in a clause like this the parties agree confidential Meishan disclosed prior to the execution agreement was intended to be in Shelby subjects so this is retroactive and the question is well what is that I mean when when the guy said hello I I'm a sales rep or the VP for XYZ is that confidential I mean it could pose problems and I think normally you want each party to have an obligation to tell you the information they're giving you as confidential so you want to be marked normally have identified and marked as confidential so there's no question about it so this is they're gonna maintain the confidentially the information for a period of two years from the date of disclosure so arguably that means you know if if this agreement runs let's say three years and you get confidential information on the very last day of the effective date of this agreement it's still covered for two years from that date of disclosure in other words the obligations continue beyond arguably the term of this this contract and two years is not is not unreasonable I've seen one year I've seen two years you could some people want five years I think if you're beyond five years if you're in a ten year period of frame a time you're getting you know pretty excessive but some people demand it obligations recipient obligations the parties express expressly agree the recipient shall not use confidential information in the development of any products or services for its own account or for the account of any third party expressly agreed to unless expressly agreed to in writing so if you want to use it somewhere else you got to get our permission furthermore the parties agreed not to use a confidential information rivers other than that necessary to consider the possibility for this business relationship so it's not only that you won't use it there but you will affirm early only use it for this this set of discussions how much care do they have to exercise in protecting your confidential information recipients shall protect the confidential information by using the same degree of care but no less than reasonable care so here's the test no less than reasonable care prevent the unauthorized use and dissemination of the information so what that means is whatever standard of care you use to protect your own information you have to use to protect our information and by the way if you happen to be sloppy there is a floor on that and the floor is no less than reasonable care recipients shall limit its internal disclosure of the competent to only those employees and agents who have a need to know so here's a Stanford do that standard do they have a need to know the information I would you now have an affirmative obligation to limit access to that information and the standard for dissemination is need-to-know okay let's take a look at exceptions so those are the duties and obligations on the party but what are the exceptions well the agreement shall impose no obligations with respect to confidential information and then here we have six exceptions and let's take a look at those the first one well if the information that is confidential becomes generally known or available to the public then you don't have to protect it anymore so for example if this involves the secret formula for coca-cola and and you get that secret formula but then it becomes available to the public then you don't have an obligation to keep it secret anymore it was acquired by the receiving party before receiving such information from and without restriction so that means if you have if you knew it before we gave it to you and you didn't have a restriction on it then you don't have to keep it confidential it's rightfully furnished for the receiving party by a third party without restriction unless furnished to circumvent this agreement so if somebody a third party gives it to you and there's no restriction on it and this isn't designed to circumvent this agreement then you're allowed to disclose it information the party has independently developed you develop the secret formula for coca-cola or the secret spices for you know Kentucky Fried Chicken or something like that then you know you do not have to keep it secret unless you developed it to circumvent the agreement is required disclosed pursuant to law provide the receiving party uses reasonable efforts to give the disclosing party reasonable notice of such required disclosure so what is this way you're in a lawsuit maybe an antitrust lawsuit or criminal prosecution and you are you get a court order I received a court order demanding that you turn over certain confidential information subject to this provision well this exception means that you I mean you know you obviously don't want to be in violation of the court order so this allows you to give the court that information but first you have to give the court that in from it and give the the other party information that you are going to disclose it and why is that the reason is they will then file a motion before the courts say you know explaining why it's conferment confidential information and either ask that there be no compliance with that order or ask that the court review the information in camera in secret and that the disclosure be limited only to parties and a lawsuit that need to see it so it gives the other party an opportunity to argue its case before the information is disclosed to the court or whatever that body is could be an arbitration panel or whatever and the last one is disclosed with the prior written consent so meaning if we say you can disclose it then you can disclose it so and so you can see right here this last sentence prior notice the such disclosure in order to flip for the reasonable opportunity to follow objections so you can see that's what's going on with the legal aspect continued development efforts they have been engaged in and you know the parties having been engaged in and continued engage in activities to develop you know this deal and other deals but they acknowledge that nothing in this Agreement prevents them from talking to other parties meaning the fact we're talking to you and signed this agreement doesn't mean we cannot explore a business relationship with other parties ownership at a confidential information by signing this agreement we are not relinquishing our ownership rights we're not giving you any license or other rights to the confidential information so we own we continue to own it at the end of this period you have to give all that confidential information back to us and give it back to us and return it for destruction so either give it back to us or destroy it now the issue here with today's world where everything tends to be digital and emails and everything's stored on flash drives and laptops and the cloud what you know what's needed here is some kind of statement preferably under oath that says the party has made good-faith efforts to return and/or destroy all versions of the confidential information including electronic versions that it has made a good-faith effort to destroy the electronic versions of the information non circumvention so this is the non circumvention part of the agreement and it says that the parties agree not to circumvent each other and in the process of negotiation they may introduce each other two companies are selling purchase purchasing similar activities or goods or whatever and party retains ownership of such referral and that the other party cannot deal directly with that party so don't go around us and the circumvention is for a reasonable period of time two years and you know anything that gets longer than two years if you get up into the 5-year range or more courts will look at that and begin to say no that is an unreasonable business restraint on that party and they may strike that clause or revise that clause to a more reasonable period of time non solicitation for a period of two years after the termination of screaming all parties agree they will not solicit to solicit for hire the other people in other words sometimes in the course of negotiations you meet somebody on the other company say man that guy is really great or men that woman really knows her stuff we should try to get her on our team so here is a restriction you can't hire or try to hire our people let's see what else they have here remedy let's see expiration so this this one is good for two years from the date last state of execution so the last part is signed the agreement that date starts the two years and that's reasonable and if you go to five years I mean I've seen them five years some people push for ten years I think two is very reasonable five you do see five years I think you're starting to reach a minute can you get that long so these are what we're gonna call the boilerplate provisions if you look at these you'll see they're they're pretty straightforward they're independent contractors this is the entire agreement it's nothing oral agreements they're not going to modify this you can only modify this in writing written consent of all the parties if one part of the agreement is illegal or valid it doesn't mean the entire document is illegal just that provision this constitutes the product of negotiations so sometimes if one person had the power of drafting the document that the document will be construed against them if an ambiguity arrives so this is no there's there's no but this is a product of negotiations not any one party you certainly represent understand this paragraph each party represents and warrants it as authority to sign the agreement knows it as actual Authority and it's taking all steps require the signature to obtain that force if you had to get a Board of resolution boy a resolution for the Board of Directors you got it disputes will be resolved in arbitration in the District of Columbia and you can go to a court of competent jurisdiction to enforce the arbitration decision and what is the applicable law well here the parties chose you Android which is not a body of law it is a body of principles as to how international contracts should work does not require any ratification by the country like the Convention on International sale good Sisk this is you know it's like the Incoterms it's like you if you wanted to apply you just say it applies and then then it applies and here you see the signature block where the companies are signing it not the individuals the companies are signing the document and then by indicates who the agent is for that for that company Owen here see this one company was from Romania so that's that's it it's a three page document again I would say these client equal MBAs and NC MDS are very common big companies are signing these all the time whenever they're exploring you know business relationships and and if you do any business the domestic or international you most likely will see you know something like this