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Non-Disclosure and Non-Circumvention Agreement

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NON-DISCLOSURE AND NON-CIRCUMVENTION AGREEMENT

This Non-Disclosure and Non-Circumvention Agreement ("Agreement") is made and entered into as of by and between Party A: , an entity (select type) , with principal place of business at ; and Party B: , an entity (select type) , with principal place of business at .

RECITALS

WHEREAS, the parties anticipate engaging in discussions and a potential business relationship regarding (the "Purpose"), and in connection therewith each party may disclose to the other certain confidential, proprietary and trade secret information; and

WHEREAS, the parties desire to protect the confidentiality of such information and to prevent either party from circumventing the other with respect to introductions, customers, suppliers, contractors or business opportunities learned or created in connection with the Purpose.

NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. DEFINITIONS

"Confidential Information" means all non-public business, technical and financial information disclosed by the Disclosing Party to the Receiving Party, whether disclosed orally, visually, in writing or by inspection, including without limitation trade secrets, customer lists, pricing, forecasts, business plans, product designs, processes, software, source code, prototypes, and information concerning contacts or potential business opportunities, regardless of whether such information is marked as confidential.

"Disclosing Party" means the party disclosing Confidential Information under this Agreement. "Receiving Party" means the party receiving Confidential Information under this Agreement.

2. EXCLUSIONS FROM CONFIDENTIAL INFORMATION

Confidential Information does not include information that: (a) is or becomes generally available to the public other than through a breach of this Agreement by the Receiving Party; (b) was already in the lawful possession of the Receiving Party prior to disclosure by the Disclosing Party; (c) is rightfully obtained by the Receiving Party from a third party without restriction and without breach of a confidentiality obligation; or (d) is independently developed by the Receiving Party without reference to the Disclosing Party's Confidential Information.

3. NON-DISCLOSURE OBLIGATIONS

The Receiving Party shall: (a) hold Confidential Information in strict confidence and exercise at least the same degree of care to protect such Confidential Information as it uses to protect its own confidential information, but in no event less than reasonable care; (b) not disclose Confidential Information to any third party except to its employees, agents, professional advisors or contractors who have a need to know for the Purpose and who are bound by confidentiality obligations at least as restrictive as those set forth herein; and (c) not use Confidential Information for any purpose other than the Purpose without the prior written consent of the Disclosing Party.

4. NON-CIRCUMVENTION

The Receiving Party agrees that it shall not, directly or indirectly, circumvent, avoid, bypass, or obviate the Disclosing Party with respect to any introduction, business opportunity, customer, supplier, subcontractor or referral introduced by the Disclosing Party during the Term of this Agreement and for the Non-Circumvention Period. The Receiving Party shall not solicit, contract with, negotiate with, or attempt to contract with any person or entity introduced by the Disclosing Party for the purpose of acquiring products, services or business without the prior written consent of the Disclosing Party.

The "Non-Circumvention Period" shall be years following the termination or expiration of this Agreement.

5. TERM; SURVIVAL

This Agreement shall commence on the Effective Date and continue for a period of years, unless earlier terminated by mutual written agreement. Notwithstanding termination, the Receiving Party's obligations with respect to Confidential Information shall survive for a period of years from the date of disclosure, except with respect to trade secrets, for which the obligations shall survive for so long as such information remains a trade secret under applicable law.

6. RETURN OR DESTRUCTION OF MATERIALS

Upon written request of the Disclosing Party or upon termination of this Agreement, the Receiving Party shall, within days, return or destroy all tangible materials containing Confidential Information and certify in writing that such materials have been returned or destroyed, except that the Receiving Party may retain one archival copy solely for compliance purposes subject to the confidentiality obligations herein.

7. REMEDIES

The Receiving Party acknowledges that monetary damages may be inadequate to fully compensate the Disclosing Party for a breach of this Agreement and that the Disclosing Party shall be entitled, in addition to any other remedies available at law or in equity, to seek injunctive relief, specific performance and other equitable remedies without the requirement of posting a bond. The Disclosing Party shall also be entitled to recover reasonable attorneys' fees and costs incurred in enforcing this Agreement.

8. REPRESENTATIONS, WARRANTIES AND INDEMNIFICATION

Each party represents and warrants that it has the full right and authority to disclose Confidential Information as contemplated by this Agreement. The Receiving Party shall indemnify, defend and hold harmless the Disclosing Party from and against any and all losses, liabilities, damages, costs and expenses (including reasonable attorneys' fees) arising out of or resulting from any unauthorized use or disclosure of the Disclosing Party's Confidential Information in violation of this Agreement.

9. LIMITATION OF LIABILITY

EXCEPT FOR WILLFUL BREACH OR GROSS NEGLIGENCE, NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR CONSEQUENTIAL, INCIDENTAL, SPECIAL OR PUNITIVE DAMAGES ARISING OUT OF OR RELATED TO THIS AGREEMENT, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

10. NOTICES

All notices required or permitted hereunder shall be in writing and shall be deemed given when delivered personally, by nationally recognized overnight courier, or three (3) business days after deposit in the mail, postage prepaid, to the addresses set forth above or to such other address as a party may designate by written notice.

11. AMENDMENT; WAIVER

No amendment or modification of this Agreement shall be effective unless in writing and signed by authorized representatives of both parties. No waiver of any breach shall constitute a waiver of any other breach or of the provision itself.

12. COUNTERPARTS; ENTIRE AGREEMENT; SEVERABILITY; GOVERNING LAW

This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements and understandings, whether written or oral. If any provision of this Agreement is held to be invalid or unenforceable, the remaining provisions shall remain in full force and effect. This Agreement shall be governed by and construed in accordance with the laws of the State of , without regard to its choice of law principles.

13. MISCELLANEOUS

The parties acknowledge and agree that nothing in this Agreement grants the Receiving Party any license or other rights in or to the Disclosing Party's Confidential Information except as expressly set forth herein. The obligations set forth in this Agreement are in addition to, and not in substitution for, any other contractual or legal obligations of confidentiality.

NOTIFICATION OF BREACH

The Receiving Party shall promptly notify the Disclosing Party in writing upon becoming aware of any unauthorized use or disclosure of Confidential Information and shall cooperate with the Disclosing Party in every reasonable way to help regain possession of Confidential Information and prevent further unauthorized use or disclosure.

ADDITIONAL PROVISIONS

Party A (Printed Name):

By:

Date:

Party B (Printed Name):

By:

Date:

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What the Non-Disclosure and Non-Circumvention Agreement Is

A Non-Disclosure and Non-Circumvention Agreement is a bilateral or multilateral contract that combines confidentiality protections with a covenant preventing parties from bypassing introductions, intermediaries, or business channels. The agreement defines Confidential Information, limits permitted uses, and sets obligations for non-disclosure; it also prohibits direct solicitation or dealing with specified contacts or opportunities introduced during the relationship. Commonly used in deals, joint ventures, brokered introductions, and sourcing, the document clarifies remedies, term length, and governing law so parties understand confidentiality scope and what constitutes circumvention.

Why this Agreement Matters for Business Relationships

Combining nondisclosure and non-circumvention provisions protects trade secrets, preserves intermediary value, and reduces the risk that a counterparty will misappropriate contacts or confidential concepts introduced during negotiations.

Why this Agreement Matters for Business Relationships

Who Typically Uses a Combined NDA and Non-Circumvention Clause

The agreement is used by parties who exchange sensitive information and rely on intermediaries or introductions that should not be bypassed.

  • Business brokers and intermediaries facilitating introductions between buyers and sellers while protecting commission rights.
  • Startups and investors sharing confidential product, customer, or technical information during early-stage diligence.
  • Suppliers and manufacturers introduced through sourcing agents who require protection against direct solicitation.

Use the agreement when confidential disclosures and introduced contacts are both essential components of the proposed relationship.

Representative Signers and Their Roles

Company Executive

A senior officer or authorized contracting representative signs on behalf of the corporate party; ensure they are expressly authorized in corporate records to bind the entity and note their title and capacity.

Independent Broker

An intermediary or broker signs to preserve commission rights and non-circumvention protections; include contact lists and defined introduction periods to limit ambiguity and enforcement disputes.

Core Elements to Include in a Professional Agreement

A clear, enforceable agreement contains defined confidential information, permitted uses, non-circumvention clauses, term and survival language, remedies, and governing law.

Confidential Information

Precisely define categories (written, oral, electronic) and carve-outs such as publicly available information or independently developed material to avoid disputes over scope.

Permitted Use

Limit use to evaluation or specific project activities and state that any other use requires prior written consent from the disclosing party.

Non-Circumvention

Specify introduced parties, duration, and prohibited activities (direct contracting, solicitation, or inducement) and identify intermediary commission terms if applicable.

Term and Survival

State the effective date, duration of confidentiality, and survival provisions for confidential obligations and non-circumvention after termination.

Remedies

Include injunctive relief, equitable remedies, and an option for liquidated damages or recovery of attorney fees where permissible under governing law.

Governing Law

Choose the governing state law and venue for disputes; specify whether arbitration or court litigation applies and include choice-of-law language.

Required Information and Practical Data Points

Party Names: Full legal names
Effective Date: MM/DD/YYYY
Defined Contacts: Introduced parties
Confidential Scope: Data categories
Term Length: Years or months
Governing State: Selected jurisdiction

Common Legal Risks and Contractual Penalties

Monetary Damages: Compensatory awards
Injunctive Relief: Court-ordered stop
Liquidated Damages: Pre-agreed sums
Attorney Fees: Fee recovery clauses
Reputational Harm: Business disruption
Loss of Commission: For brokers or intermediaries

Common Pitfalls to Avoid When Preparing This Agreement

  • Overly broad definitions that sweep in public or independently developed information, creating unenforceability risk.
  • Vague non-circumvention periods or undefined 'introduced parties' that invite disputes about scope.
  • Failing to specify remedies or limiting equitable relief, which undermines enforcement of non-circumvention claims.
  • Using inconsistent governing law or venue clauses that complicate cross-border or interstate enforcement.

Step-by-Step: How to Complete the Agreement

Follow these steps to create a clear, enforceable Non-Disclosure and Non-Circumvention Agreement before sharing confidential information or introductions.

  • 01
    Identify Parties: Enter full legal names and entity types.
  • 02
    Define Confidential Data: List categories and permitted disclosures.
  • 03
    Set Non-Circumvention Scope: Name introduced contacts and prohibited conduct.
  • 04
    Finalize Terms: Add term, remedies, governing law, and signatures.

How to Set Up a Digital Signing Workflow

Configure an eSignature workflow that preserves audit trails and matches your approval sequencing before sending the agreement for signature.

Field Configuration
Signer Order Sequential or parallel routing
Authentication Email link, SMS code, or advanced ID check
Notifications Automatic reminders and completion emails
Audit Trail Capture IP, timestamps, and actions

Digital Signing and eSubmission Considerations

Use a platform that supports secure eSignatures, robust audit trails, and optional advanced signer authentication for sensitive agreements.

  • File Formats: PDF and DOCX compatible
  • Authentication: Email, SMS, or KBA
  • Audit Trail: Timestamps and IP logging

Ensure the chosen provider supports HIPAA or BAA requirements when handling protected health information and can produce admissible audit records for disputes.

eSignature Vendor Comparison for Executing NDAs and Non-Circumvention Clauses

Compare basic plan pricing and feature availability for common eSignature vendors; signNow is listed first per the comparison format.

signNow DocuSign Adobe Sign PandaDoc HelloSign
Starting Price $8/user/mo $15/user/mo $14/user/mo $19/user/mo $15/user/mo
Free Trial 7-day free trial, no credit card required Varies by vendor Varies by vendor Varies by vendor Varies by vendor
Bulk Send Yes Yes Yes Yes No
Audit Trail Yes Yes Yes Yes Yes
HIPAA Compliant Yes Yes Yes No No

Practical Examples of When to Use This Agreement

Real-world scenarios show how confidentiality and non-circumvention provisions preserve value and prevent bypassing intermediaries.

Brokered Acquisition

A middle-market broker introduces a buyer to a seller

  • Broker documents introductions and commission terms
  • The combined agreement protected the broker’s commission in a dispute and enabled injunctive relief when the buyer attempted direct engagement.

Tech Licensing

A startup shares prototype details with a prospective licensee

  • Parties list specific contact persons and excluded disclosures
  • Non-circumvention language prevented the licensee from contacting key customers directly and preserved the startup’s intermediary fees.

Practical Tips for Drafting and Reviewing the Agreement

Adopt clear, narrow definitions and unambiguous timeframes to improve enforceability and reduce litigation risk.

Be Specific
Define confidential categories, introduced parties, and prohibited actions rather than relying on broad or vague terms.
Limit Duration
Choose reasonable confidentiality and non-circumvention periods tied to the business purpose; overly long terms risk unenforceability.
Align Remedies
Include injunctive relief clauses and specify whether liquidated damages are allowed under governing law.
Document Introductions
Attach a schedule or exhibit listing introduced contacts and dates to reduce disputes over who is protected.

Typical Workflow for Sharing and Signing This Agreement

A predictable process reduces exposure: prepare, route, authenticate, sign, and retain with auditable records.

  • Prepare Document: Draft and attach any exhibits or contact lists.
  • Route for Review: Share with internal stakeholders and counsel as needed.
  • Authenticate Signers: Use email, SMS, or stronger ID checks for high-risk exchanges.
  • Sign and Archive: Capture audit trail and store signed copies securely.

Frequently Asked Questions and Practical Answers

Answers to common questions about enforceability, eSignatures, and practical drafting issues for combined nondisclosure and non-circumvention agreements.


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