Free New Hampshire Non-Disclosure Agreement


Protecting Trade Secrets with the Non-Disclosure Agreement in New Hampshire

The confidentiality agreement (CA) is also called a non-disclosure agreement (NDA). It represents a form of legal documentation used to deter employees, potential investors, suppliers, or contractors from divulging business secrets to competitors or the public. Often, the information that is kept secret using the confidentiality agreement in New Hampshire is referred to as the trade secret.

When creating an NDA, you will have to fill out a free New Hampshire non-disclosure agreement form. The information in the form must be complete, and the document must have the signatures of the parties involved to be enforceable. It should also abide by the state laws. But, before we look at those details, what are trade secrets?

Trade secrets refer to the information that a company (disclosing party) wishes to keep away from the public or competitors. Information that falls in the business trade secrets category includes customer lists, non-patented inventions, formulas, recipes, sensitive marketing information, techniques, processes, devices, and any other kind of information that gives a business a competitive edge.

The information considered a trade secret should enable the company to derive an independent economic value which is either actual or potential value from being kept a secret from other people who could obtain actual or potential value from the disclosure of the information. The information should also be subject to efforts that are regarded to be reasonable under the circumstances that keep the information a secret.

  • Under the state laws, information recognized and acceptable as a trade secret has to meet some conditions.

    • It should not fall outside the business entity

    • Should be known by employees and persons involved in the business only

    • Should be subject to a reasonable measure which protects the secrecy of the information

    • It should be valuable

    • The information must be difficult for other people/ companies to acquire or duplicate independently.

Conditions for the validity of the NDA

  • Your free non-disclosure agreement in New Hampshire is only deemed valid and enforceable if it contains the following elements.

    • Definition of the confidential information – the contract should have ‘Confidential Agreement’ marked on all the information or materials regarded as confidential. Clarity helps in the establishment of the categories or the types of information that is regarded confidential and also it enables the establishment of rules that will govern the NDA.

    • Exclusions from the CA – with this section, it is clear that the obligations of the receiving party do not include protecting the information that is already out in public at the time of signing the NDA. It also includes the information that is discovered/ created by the receiving party, information from third parties or even the information that the receiving party discloses to the public or third parties following written approval from the disclosing party.

    • Obligations – among others, this section outlines the fact that the receiving party will hold and maintain the confidentiality of the business’ trade secrets for the exclusive benefits of the disclosing party. The receiving party is also expected to restrict the access to the information given in confidence to employees, third parties, and contractors. And if it’s reasonably required, employees, third parties, and contractors have to sign an NDA to access the information.

  • Under the obligations, it should be noted that the NDA forbids the receiving party from publishing, copying, printing or disclosing the information for their own benefit or to the detriment of the disclosing party. The receiving party is also expected to return the CA, records, notes and tangible materials to the disclosing party upon receipt of a written request from the disclosing party.

    • Time periods – this part of the NDA provides that the NDA will remain effective even after the termination of the receiving party until that time when the information in the NDA no longer qualifies to be regarded as a trade secret or when the disclosing party sends a notice to the receiving party terminating their obligations over the NDA.

  • Other clauses provided for in the NDA in New Hampshire include:

    • Severability (where the remaining part of the NDA will be enforceable if the court finds one provision in the NDA to be invalid), relationship created between the parties by the NDA, integration that covers the expression of understanding between the parties, and waivers applicable when a party fails to exercise the rights provided.

    • Lastly, the disclosing and the receiving parties must sign and date the NDA for its validity.

Keep in mind that the NDA must be according to the requirements of the Union Trade Secrets Act under Section N.H. R.S.A. Secs. 350-B: 1 et seq.

Misappropriation

This refers to the acquisition of trade secrets by a person who knows or has a reason to know that the trade secret was acquired through improper means like misrepresentation, bribery, theft, a breach, or the inducement of the breach of contract to maintain secrecy.

Reason to Know Standard

The state prohibits the use of trade secrets by a company when the company has every reason to know that the material in question constitutes a trade secret. The law also refers to this as constructive knowledge and a company should be aware of purloined trade secrets and not knowing doesn’t count.

  • Penalties for misappropriation

    • Trade thieves are stopped from disclosing the trade secrets through court-ordered injunctions.

    • The victim of the theft could seek financial compensation if they suffer an actual loss.

Note that the state requires that a lawsuit for trade secret theft or infringement is brought before the court within 3 years after the discovery of the misappropriation. Alternatively, reasonable diligence should be exercised. So, you should act fast.

Non-competes

Non-competes are the restrictive contracts that employers use to limit the ability of an employee from competing with their employee by trading business/ trade secrets or stealing customers. To be enforceable, this restrictive agreement must strike a balance between the protection of the employer’s legitimate interests from any unfair competitive advantage with the rights of the employees to work in the field they are trained in. This means that the terms of the non-compete should be reasonable in the eyes of the law.

Under the new laws, the non-competes are only valid if they seek to forbid employees from appropriating the assets belonging to the employers legitimately.

An important part of non-competes and even CAs/ NDAs is the consideration. This is the value that both parties receive from receiving / giving something valuable from a contractual agreement. Often, an offer of continued employment or initial employment is enough consideration. The other consideration acceptable by the courts is the benefit to the employee where he or she agrees not to compete with their employer in the event of the termination of the employment relationship.

For enforcement, the non-compete should be reasonable in time and its geographical scope. Reasonable times range from 1.5years to 5 years depending on the profession. The geographical scope is reasonable if it’s less than 25 miles or within any other geographical constraints deemed reasonable.

Are you looking for an NDA in Portsmouth, Manchester, Concord, Conway, Keene, Nashua, Hampton, Rochester, Lebanon, or any other city in New Hampshire? Get started with our free confidentiality/ non-disclosure agreement forms available online.