Standard Form Mutual Non-Disclosure Agreement

professional profile

February 09, 2023

by a professional from Simon Fraser University in Toronto, ON, Canada

What terms and conditions does the community consider to be “market terms” in 2023 when reviewing a MNDA in the context of an M&A transaction? as time, experience, technology, customer evolve so does our thinking related to Standard Form Mutual Non-Disclosure Agreement. let me know what you are seeing and experiencing in 2023?

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commentor profile
Reply by a professional
from Villanova University in West Chester, PA, USA
Restrictions on recipients of the information and the covenants related to those recipients are often more nuanced in the M&A transaction space than many standard NDA's provide. So, I often see this is a neglected area of customization from contract to contract and deal to deal. Necessary recipients will depend on funding, corporate structure, advisors involved, etc. Additional recipients may need to sign an MNDA or covenant that they are bound by terms no less stringent are becoming more important as deal teams evolve. Those disclosures of, or exceptions to, non-disclosure obligations are important so there isn't inadvertent breach of the contracts.
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Reply by an investor
from Fort Lewis College in Denver, CO, USA
I've been shocked to see a lot of NDA's this year actually that are entirely too broad and restrictive. Some of that language has been to completely ban contacting any competitors, suppliers, vendors, etc. of a target company. I understand the need to protect the sell side ownership, but this has the net effect of preventing a buyer from contacting any other business in that industry. You would think an intermediary would think to themselves, this seems overly broad and restrictive. I suspect because of that, those might not even be enforceable.
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