Make a Kentucky Non-Disclosure Agreement

Kentucky State Laws

Kentucky non-disclosure agreements are governed by Kentucky’s Trade Secrets Act, KY Rev Stat §§ 365.880 through 365.993 .

The Kentucky Trade Secrets Act also explains the damages that a business may be entitled to receive as a matter of law if an employee or contractor violates the agreement as well as provides other valuable information related to NDAs and trade secrets.

In addition to a non-disclosure agreement, businesses may also find it beneficial to use a Kentucky non-compete agreement to improve their ability to protect critical business information.

Definition of “Trade Secrets”

Trade secrets are considered a legitimate business interest. As such, they are often the subject of Kentucky non-disclosure agreements.

Kentucky’s Trade Secrets Act defines what is considered a “trade secret.” A trade secret is information such as a formula, pattern, compilation, program, data, device, method, technique, or process that isn’t public knowledge. It also may not be something that another business could easily come up with.

A trade secret must have potential or actual monetary value. Businesses claiming that the NDA protects at least one trade secret must take reasonable actions to keep that information secret.

How to Write a Kentucky Non-Disclosure Agreement

Before you begin drafting your Kentucky non-disclosure agreement, take some time to first read over the state's trade secret law. However, keep in mind that this is no substitute for getting legal advice from a qualified lawyer. A lawyer can help ensure that your NDA's enforceability is valid since they have specialized training in employment law. An NDA template in Microsoft Word (.docx) for easy editing.

• The first paragraph is used to identify the parties. You are the Disclosing Party. You should also include your full address. The employee, the independent contractor, or other third-party entering into the NDA is the Receiving Party. Their full address should also be listed. You should also include the purpose of the agreement: to prevent the misappropriation of trade secrets. You should also include an effective date for the NDA.
• The definition of trade secrets according to the State of Kentucky. The State of Kentucky defines a trade secret as information such as a formula, pattern compilation, program, data, device, method, technique, or process that has actual or potential economic value. It cannot be information that is public knowledge or something easy for another business in the industry to figure out on their own. Your business must also take reasonable steps to keep the information private.
• Exemptions from trade secret status. For example, when information is made public through no fault of the receiving party, when something is created or discovered by the receiving party before it is told to or provided to the disclosing party, something learned by the receiving party by the legitimate means except through the disclosing party or their agent, or anything shared by the receiving party with the written consent of the disclosing party.
• Obligations of the receiving party. Examples include maintaining the confidential information in their highest confidence to benefit the disclosing party, restricting access to the trade secret without the prior written consent of the disclosing party, and refusing to use the information to their benefit without receiving the written consent of the disclosing party.
• Relationship clause. Some Kentucky non-disclosure agreements benefit from a relationship clause because it states that nothing within the NDA makes either party a partner, employee, or joint venturer or the other.
• Jurisdiction clause. This clause is used to allow Kentucky law to govern the NDA.
• Severability clause. This clause states that if a Kentucky court finds a clause invalid, then the remainder of the agreement will remain enforced.
• Integration clause. This clause states that the parties agree that the agreement expresses their complete understanding of the subject matter and overrides all prior proposals, agreements, representations, and understandings. It also usually states that the non-disclosure agreement may not be amended except in writing and only if that amendment is signed by the parties.
• Waiver clause. This clause states that if a party fails to exercise any right within the agreement, it does not waive previous or subsequent rights.

At the end of the NDA, include a signature line and space for each party to print their name and list their title from the agreement (Disclosing Party or Receiving Party). Then, include a space for the date. Each party to the agreement should receive a copy of the finalized agreement.