Description

Unilateral Confidentiality Agreement (Pro-Recipient)

Summary

This is a unilateral Confidentiality Agreement, also known as a nondisclosure agreement or NDA, drafted in favor of the recipient. Under this agreement, one party discloses confidential information to the other in connection with a commercial transaction. Generally, unilateral confidentiality agreements preserve the confidentiality of the disclosing party’s sensitive information. Additionally, parties use this agreement to restrict the recipient’s use of the confidential information to limited purposes expressly set out in the agreement.

Details

Generally, unilateral confidentiality agreements:

• Preserve the confidentiality of the disclosing party’s sensitive information.
• Restrict the recipient’s use of the confidential information to limited purposes that are expressly set out in the agreement.

Under this unilateral confidentiality agreement, the recipient may add additional provisions to the initial draft. Doing so may help address industry or deal-specific concerns, as well as other terms that are indirectly related to confidentiality. For example, a party may choose to add a non-solicitation provision.

When preparing or reviewing a unilateral confidentiality agreement, the recipient should adjust the operative provisions in consideration of:

• Its leverage and position as the recipient.
• The relative value and sensitivity of the information to be disclosed.
• The administrative burden of maintaining the confidentiality of that information.

Assumptions

This Confidentiality Agreement assumes that:

• The parties to the agreement are US entities and the provision and retention of confidential information takes place in the US. Parties should modify these terms to comply with local laws when organized, operating, or the information will be provided or retained, in a foreign jurisdiction.
• There are a single disclosing party and a single recipient. The parties must revise the agreement if there are additional disclosing parties or recipients. For example, if there are multiple disclosing parties or recipients, the agreement must be revised to reflect whether their obligations are joint, several, or joint and several.
• Parties use this agreement in a business-to-business transaction. This agreement may not be suitable for a consumer contract or a government contract. Accordingly, such contracts may involve legal and regulatory requirements and practical considerations that are beyond the scope of this resource.
• This is a unilateral agreement, which assumes that only one party is disclosing confidential information. The parties should not use this agreement if both parties are likely to be disclosing confidential information.
• These terms are not industry-specific. This agreement doesn’t account for any industry-specific laws, rules, or regulations that may apply to certain transactions, products, or services.