Amendment Clause FAQ

An amendment clause (also called a "modification clause") establishes the rules for changing the NDA after it's signed. It specifies what's required for a change to be valid and binding.

A typical amendment clause says:

• Amendments must be in writing
• Amendments must be signed by both parties
• Oral agreements don't modify the NDA
• Sometimes: Amendments must reference the original agreement

Why this matters:

• Prevents misunderstandings: Without clear rules, parties might disagree about what was actually changed
• Creates evidence: Written amendments create a paper trail
• Protects against unauthorized changes: Prevents lower-level employees from making binding modifications
• Supports enforceability: Courts can clearly see what terms apply

Without an amendment clause: General contract law would apply, which may allow oral modifications in some jurisdictions. This creates uncertainty that both parties should want to avoid.

If your NDA requires written amendments: Yes, writing is required for a valid amendment.

Standard clause language:

"This Agreement may not be amended, modified, or supplemented except by a written instrument signed by authorized representatives of both parties."

What "in writing" means:

• Traditional paper documents with wet signatures
• Electronic signatures (DocuSign, Adobe Sign, etc.) usually qualify
• Email may qualify in some jurisdictions if it contains essential terms and clear intent
• Text messages are risky - courts are split on whether they satisfy "writing" requirements

Can an oral agreement override a "writing required" clause?

This is a complex legal question with different answers in different jurisdictions:

• Traditional view: No - the written requirement is self-enforcing
• Modern trend: Maybe - if parties clearly intended an oral modification and acted on it (course of performance)
• UCC context: Written requirements can be waived by conduct

Best practice: Always put amendments in writing, even if you think an oral agreement might be enforceable. Why create risk?

It depends on your NDA's language and your jurisdiction, but email amendments are risky.

When email might work:

• Your NDA says "written instrument" without requiring formal signatures
• Both parties clearly express agreement in the email exchange
• Your jurisdiction recognizes emails as "writings" for contract purposes
• The email is from someone with authority to bind the organization

When email probably won't work:

• Your NDA says "signed by authorized representatives" - emails lack signatures
• Your NDA requires amendments to be executed "in the same manner as this Agreement"
• The email exchange is ambiguous about what's actually agreed
• The person emailing doesn't have signing authority

Risks of email amendments:

• Disputes about which email in a chain is "the" agreement
• Unclear whether proposals were actually accepted
• Questions about authority of the person sending the email
• Difficulty proving the email wasn't altered

Better approach: Use email to negotiate, then document the agreed changes in a formal written amendment signed by both parties. Electronic signature platforms make this easy and fast.

Only people with actual authority to bind your organization should sign amendments.

People who typically have authority:

• Officers: CEO, CFO, General Counsel, COO
• Delegated signatories: People given formal signing authority by the board or officers
• Those who signed the original NDA: Usually have implied authority for amendments

People who typically do NOT have authority:

• Project managers and team leads (unless specifically delegated)
• Sales representatives
• Individual contributors
• Outside consultants

What if the wrong person signs?

• The amendment may be voidable (the company can disavow it)
• But if the company acts as though the amendment is valid, it may become binding through ratification
• The other party might claim "apparent authority" if they reasonably believed the signer could bind the company

Best practices:

• Maintain a clear signing authority policy
• Verify the other party's signer has authority
• Request a certificate of authority for significant amendments
• Match signer level to amendment significance

Yes, and for significant amendments you should.

Ways to verify authority:

• Check title: Officers (CEO, CFO, etc.) typically have inherent authority
• Request a certificate: A secretary's certificate confirming the signer's authority
• Check public filings: SEC filings list officers; state records show authorized agents
• Review organizational documents: Bylaws may specify who can sign contracts
• Ask for board/committee approval: For major amendments, request proof of approval

When to be more careful:

• The signer's title doesn't clearly indicate signing authority
• The amendment is materially changing important terms
• The other company is large with complex approval requirements
• You've never dealt with this person before
• The amendment seems one-sided or unusual

When informal verification is OK:

• Minor administrative amendments
• Same person who signed the original NDA
• Clear officer title (CEO, General Counsel)
• You have an established relationship with the company

If you discover the signer lacked authority after signing: Raise the issue promptly. The amendment might be voidable, or the company might ratify it. Don't rely on an amendment without resolving authority questions.

You can establish a tiered approval system, either in the original NDA or through a separate delegation.

Example tiered approach:

• Administrative changes: Project managers can approve (e.g., updating contact info, changing notice addresses)
• Minor modifications: Department heads can approve (e.g., extending term, adding representatives)
• Material changes: Officers only (e.g., expanding scope, changing confidentiality periods)

How to implement:

• In the NDA: "Amendments regarding [X] may be approved by the project lead identified in Exhibit A"
• Separate delegation: Written authority letter specifying what the person can approve
• Power of Attorney: Formal legal document for broader authority

Benefits:

• Faster approval for routine changes
• Reduces burden on senior executives
• Keeps decision-making at appropriate levels

Risks to manage:

• Clear boundaries on what's "administrative" vs. "material"
• Training for delegated approvers
• Documentation of delegations
• Regular review to ensure delegations remain appropriate

Create a simple written amendment before the NDA expires.

Sample term extension amendment:

"This Amendment to the Non-Disclosure Agreement dated [Original Date] between [Party A] and [Party B] is entered into as of [Amendment Date]. The parties agree to extend the Term of the Agreement from [Current End Date] to [New End Date]. All other terms and conditions of the Agreement remain unchanged and in full force and effect. [Signature blocks]"

Timing considerations:

• Before expiration: Ideal - clearly extends the existing agreement
• After expiration: More problematic - you may need to reinstate the agreement and address the gap period

If the NDA already expired:

• Consider whether survival provisions still protect confidential information
• You might need a new NDA rather than an amendment
• Address whether the extension is retroactive to cover the gap

Automatic renewal clauses: Some NDAs include automatic renewal provisions ("This Agreement shall automatically renew for successive one-year periods unless..."). Check if your NDA has this before drafting an amendment.

Memorialize the verbal agreement in writing as soon as possible.

Steps to formalize a verbal agreement:

• Document immediately: Send an email summarizing what was agreed, asking the other party to confirm
• Prepare a formal amendment: Draft a proper amendment document reflecting the agreed change
• Execute promptly: Get both parties to sign before memories fade or positions change
• Address effective date: Decide if the change is retroactive to when you verbally agreed or effective when signed

What to include in the amendment:

• Reference to the original NDA (date, parties)
• Clear statement of what's being changed
• Effective date of the change
• Confirmation that other terms remain unchanged
• Authorized signatures

Why formalization matters:

• Your NDA likely requires written amendments
• Verbal agreements are hard to prove
• Memories differ about what was actually agreed
• Personnel changes may make the verbal agreement impossible to verify later

What if the other party won't sign? If they agreed verbally but won't formalize it, you have a problem. Their refusal might indicate they didn't really agree, or they've changed their mind. You may need to continue under the original terms.

Sometimes, but it's often simpler to use a joinder agreement or sign a new NDA.

Options for adding parties:

1. Amendment adding a party:

• All existing parties plus the new party sign the amendment
• The new party agrees to be bound by all NDA terms
• May require modifying terms that assume two-party structure

2. Joinder agreement:

• A separate document where the new party agrees to join the existing NDA
• Existing parties acknowledge and consent to the joinder
• Common for multi-party arrangements

3. Separate NDA:

• The new party signs a fresh NDA with one or more existing parties
• Simplest approach if the new party has a different relationship
• Avoids complicating the existing agreement

Considerations when adding parties:

• Does the new party need access to all existing confidential information?
• Should the new party have the same rights and obligations as original parties?
• How do indemnification and liability provisions apply to the new party?
• Do governing law and venue choices still make sense?

Recommendation: Unless the original NDA was designed for multiple parties, a separate NDA with the new party is usually cleaner.

This is a common amendment scenario - you need to clearly define what's added or removed from scope.

Expanding scope (adding more information types):

• Specify exactly what new categories of information are covered
• Clarify whether new information has the same protections as original scope
• Consider whether any special handling is needed (higher standard of care, different marking)

Sample expansion language:

"The definition of Confidential Information is hereby amended to include [new category]. Such information shall be subject to all protections of the Agreement, including [specific provisions]."

Narrowing scope (removing information types):

• Be explicit about what's no longer confidential
• Address information already disclosed under the old scope
• Consider whether return/destruction applies to carved-out information

Changing the purpose:

If you're changing scope because the business purpose changed (e.g., from evaluating a partnership to evaluating an acquisition), consider amending the Purpose clause as well. The two are interconnected.

Best practice: When significantly changing scope, attach a revised definition as an exhibit rather than trying to describe changes inline. This makes it clear what the current scope is.

These terms are often used interchangeably, but there are nuances.

Amendment:

• Changes existing terms of the agreement
• Modifies, deletes, or replaces language
• Most formal approach
• Example: Changing the survival period from 3 years to 5 years

Addendum:

• Adds new terms without changing existing ones
• Supplements the original agreement
• Example: Adding a new category of confidential information

Side Letter:

• Informal agreement on specific points
• Often addresses practical implementation rather than legal terms
• May or may not be binding depending on language
• Example: Clarifying how destruction certificates will be handled

Practical advice:

• For any change to legal terms, use "Amendment"
• Use "Addendum" if you're truly only adding, not changing
• Avoid "Side Letter" for important changes - it sounds non-binding
• What matters most is clear, precise language - not the title

A complete amendment should include these elements:

1. Title and reference:

• "Amendment No. 1 to Non-Disclosure Agreement"
• Reference the original agreement date
• Identify all parties

2. Recitals (background):

• Brief description of the original agreement
• Reason for the amendment (optional but helpful)
• "WHEREAS, the parties wish to amend certain terms..."

3. The actual changes:

• Identify each section being changed by number/title
• Quote the language being deleted or replaced
• State the new language clearly
• Use "deleted in its entirety," "replaced with," "amended to add"

4. Effective date:

• When does the amendment take effect?
• Is it retroactive to a prior date?

5. Confirmation of remaining terms:

• "Except as expressly modified hereby, the Agreement remains in full force and effect"
• "In the event of conflict, this Amendment shall control"

6. Signature blocks:

• Authorized representatives of all parties
• Printed names and titles
• Date of signature

Good amendment tracking prevents confusion and disputes.

Basic tracking approach:

• Number amendments sequentially (Amendment No. 1, Amendment No. 2, etc.)
• Keep all amendments with the original NDA
• Maintain a summary sheet showing key terms as currently amended
• Store originals or certified copies securely

For heavily amended agreements:

• Create an "Amended and Restated" version that incorporates all changes into a single clean document
• This becomes the new controlling document
• Reduces confusion about which version of each clause applies

Amendment tracking table:

Consider maintaining a simple table:

• Amendment number and date
• Sections modified
• Brief description of change
• Effective date

Common mistakes:

• Not numbering amendments (leads to "which one came first?" disputes)
• Failing to reference the original agreement clearly
• Inconsistent defined terms across amendments
• Losing track of amendments when personnel change

Best practice: If you have more than 2-3 amendments, consider creating an amended and restated NDA that consolidates everything.

Yes, in most cases electronic signatures are valid for NDA amendments.

Legal framework:

• E-SIGN Act (US federal): Electronic signatures are generally valid
• UETA (most US states): State-level validation of e-signatures
• eIDAS (EU): Recognizes electronic signatures across Europe

What e-signature platforms provide:

• Identity verification of signers
• Audit trail showing when and how documents were signed
• Tamper-evident seals on completed documents
• Secure storage of executed documents

When to use wet signatures instead:

• If the original NDA was executed with wet signatures and requires the same for amendments
• If the counterparty's country doesn't recognize e-signatures
• If the amendment involves particularly sensitive changes
• If your organization's policy requires wet signatures above a certain dollar value

Best practices for e-signatures:

• Use a reputable platform (DocuSign, Adobe Sign, HelloSign)
• Include clear signing instructions
• Verify signers' email addresses
• Download and retain copies of fully executed documents