Recently, a client called me on his way to a meeting with a potential acquisition target. And, yes, I mean actually on his way… in the car… driving to the meeting.

You see, in the hustle to get the meeting on his busy calendar, he had almost forgotten one of the important precepts of protecting confidential information on the way to a deal: the non-disclosure agreement.

Not signing an NDA would not be an option… but it could be a last minute deal breaker.

The good news was… it was early in the process. The better news was… he called his lawyer before he arrived. [He didn't tell me whether he was already in the parking lot and I didn't ask!]

So, we had the opportunity to strategize as to the best way to handle the situation he faced: Meeting with a long-time colleague to explore a business acquisition possibility and, due to the relationship, neither party really thinking about legal documents prior to this first meeting.

Just before the meeting, however, my client learned that he would be asked to sign a non-disclosure agreement ["NDA"] right there, at the table… with no legal review and no lawyer at his side.

So, what should he do?

After all, this was a business owner my client has known for 20+ years… a reputable guy… someone with whom my client hopes to do business. Starting off by refusing to sign an NDA won't be an auspicious beginning.

Here is the spectrum of possibilities:

• Don't go. Walk away… keep driving… go to a movie… but don't go to the meeting!

• Walk into your colleague's conference room and sign whatever is shoved in front of you… after all, it's boilerplate, right? Who pays attention? [I hope you know this is not the right answer!]

• Ask your colleague for a cup of coffee and some quiet reading time before signing [of course, that assumes you will recognize all of the "gotchas"].

• Explain that, not having had a chance to have your lawyer review it in advance, you suggest that the two of you have a very preliminary discussion, light on confidential information and heavy on industry standards and experience.
  
  You tell your colleague that you will take it back to your office, e-mail it to your lawyer for her review and comment, and get it back to your colleague the next day.
  
  Bingo! This is the best option. After all, wouldn't your colleague prefer that you undertake the obligations in an NDA seriously… by consulting your attorney… rather than dashing off a signature and never giving the issue a second thought?

Remember the Massachusetts Data Security Regulations ["Regulations"], whose effective date of March 1, 2010, set off a flurry of frantic activity by small business owners? Those do-it-yourself plans, mandated by state government to protect the personal information of Massachusetts residents, had to be crafted in the midst of a recession, when no small business owner had sufficient financial resources to hire professionals to do it for them. But, do it they did.

Now, another March 1 deadline has arrived… the Regulations require that you ensure that the service providers whose contracts with you pre-dated March 1, 2010… at least those who "receive, store, maintain or process" personal information of Massachusetts residents… are in compliance on March 1, 2012.

Clearly your employee benefits providers are among those vendors required to comply… payroll company, health insurance provider, 401 (k) administrator… think through the possibilities. Then make sure that your contracts with them require them to maintain data security safeguards and ask for confirmation of their Written Information Security Program [WISP].

Also remember that the Regulations contain a "risk-based analysis," so don't expect to see the same size and scope of WISP from a major health insurance provider as you will see from the sole proprietor who adds content to your web site on an occasional basis.

Psst… still struggling to "perfect" your WISP? [Notice, I didn't ask if you had actually done it… you know you need it!]

The small business sample guidelines on-line is an excellent place to start. If you are still "working on it", visit the Mass.Gov Small Business Guide and use the guidelines offered in the sample to keep you headed in the right direction.

Just remember, when you sign a contract with a new client and it contains a provision that you will "comply with all applicable laws, rules and regulations," this is the kind of requirement that is covered, so be sure you protect your business by having the WISP in place.

Widett and McCarthy specializes in advising small business owners in the area of contracts. Whether reviewing a contract for services with your customer, negotiating a lease with your landlord or finalizing financing documents with your lender, we make sure your best interests are protected.

In addition, and for those clients whose successful growth requires a more comprehensive relationship, we act as "general counsel:" On-call when you need us as a sounding board, legal advisor and strong right hand.