A non-disclosure non-use and non-circumvention agreement (NNN) is a legal document that helps to protect confidential information shared between parties during a business transaction. The agreement stipulates that the recipient of the confidential information cannot use it for their own benefit or disclose it to any third party.

Why Use an NNN Agreement?

Businesses share confidential information all the time, especially during mergers and acquisitions, joint ventures, and collaborations with other companies. However, it is critical to safeguard this information to prevent it from falling into the wrong hands. An NNN agreement helps to establish trust between parties sharing confidential business information.

What Does an NNN Agreement Cover?

There are three main aspects of an NNN agreement that cover non-disclosure, non-use, and non-circumvention.

Non-disclosure: This clause stipulates that the recipient of confidential information cannot disclose it to any third party. However, there are exceptions where the information is required by law or a court order.

Non-use: The non-use clause prohibits the recipient from using the confidential information for their own benefit or gain. This clause ensures that the confidentiality of the information is maintained, and the recipient does not take advantage of the shared information.

Non-circumvention: This clause ensures that the recipient does not bypass the disclosing party by contacting any of its clients, suppliers, or other business partners for their own purposes. The recipient must not use any confidential information to circumvent the disclosing party.

What Happens if the NNN Agreement is Breached?

If the NNN agreement is violated, it can result in significant financial and legal consequences for the offending party. Breaching an NNN agreement can lead to a lawsuit for damages, injunctive relief, and other legal remedies.

In conclusion, an NNN agreement is a vital legal document for businesses that share confidential information. It helps to establish trust between parties and prevents the wrong use and disclosure of confidential information. Before entering into any business transaction that requires the sharing of confidential information, ensure that all parties involved sign an NNN agreement.