Unilateral Non-Disclosure
Agreement (NDA)
About Skala NDA
The Unilateral Non-Disclosure Agreement (NDA) is a legal tool designed to protect confidential information when only one party (Disclosing Party) shares sensitive material with another party (Receiving Party). This NDA is commonly used when sharing proprietary information for:
engaging contractors, employees, or consultants;
negotiating supplier agreements;
providing data to advisers.
This form of NDA does not impose mutual obligations. Only the Receiving Party undertakes to protect information.
Importance of Using the NDA Properly
The value of an NDA is in its proper use and enforcement. A current high-profile example is the dispute involving Tesla and a former employee alleged to have leaked trade secrets to a rival. Such cases demonstrate that NDAs are critical tools, but they are only effective when:
thoughtfully drafted to match the circumstances;
used alongside robust internal processes to safeguard data;
actively enforced in the event of a breach.
Key Terms to Complete
The Skala Unilateral NDA template requires the parties to define certain key terms. The table below sets out considerations when completing these fields.
Limitations and Exceptions
The Unilateral NDA contains standard exceptions to confidentiality obligations. These include information that:
is or becomes public through no fault of the Receiving Party;
the Receiving Party already lawfully possessed before disclosure;
is independently developed without reference to the confidential information.
It also allows for required disclosures by law, provided the Receiving Party gives notice where possible and assists in seeking protective measures.
Whistleblower protections are expressly mentioned (e.g., under the U.S. Defend Trade Secrets Act, UK Public Interest Disclosure Act, Singapore's Protected Disclosure provisions). NDAs cannot and should not be used to silence lawful reporting of misconduct.
Enforcement
If confidentiality is breached, the Disclosing Party may seek:
injunctive relief to prevent further misuse;
damages for any loss suffered.
The Skala Unilateral NDA stipulates that breaches of confidentiality can cause harm that is not compensable by money alone. Therefore, it provides for timely equitable relief.
Practical Tips
To make the Unilateral NDA effective:
ensure confidential material is clearly labelled as “confidential” where possible;
share information only on a need-to-know basis;
keep a record of what is disclosed and to whom; and
remember that an NDA is not a substitute for internal security measures.
Final Word
Unilateral NDAs play an important role in protecting sensitive information. However, they must be combined with sensible data handling practices and a willingness to enforce rights if necessary.
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FAQ
Use a unilateral NDA when only one party is disclosing sensitive information and the other is only receiving it. Common scenarios: sharing a business concept with a potential investor, giving a contractor access to proprietary systems, onboarding a new employee, or providing a vendor with access to customer data. If both parties will be sharing sensitive information, a mutual NDA is more appropriate.
It can, but many early-stage investors — particularly VCs — routinely decline to sign NDAs before an initial pitch, since they review hundreds of deals in overlapping spaces. For detailed technical discussions after the first meeting, an NDA becomes more reasonable to request. If an investor agrees to sign, a unilateral NDA protects your business plan, financial projections, product details, and any other confidential information you share.
Define it broadly (e.g., all business, technical, financial, and operational information) with clear carve-outs: information already public, already known to the receiving party, or independently developed by them. You may also list specific categories — source code, customer lists, pricing data — for extra clarity. Avoid vague language; courts tend to interpret ambiguous confidentiality clauses narrowly against the party seeking to enforce them.
Yes. A unilateral NDA can generally be signed electronically, subject to applicable law and proper execution. A valid electronic signature usually has the same legal effect as a handwritten signature. Each party should keep a copy of the signed agreement and any available signing record or audit trail.
If the receiving party breaches the NDA, the disclosing party may seek monetary damages for losses caused by the breach. It may also seek injunctive or other equitable relief to stop or prevent further misuse or disclosure of confidential information. The agreement focuses on damages and equitable remedies, rather than automatic penalties.
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