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Acquirer Protection

Buyer-Side M&A NDA Generator

Generate NDAs optimized for potential acquirers. Access target company information while protecting your interests and negotiating position.

When to Use a Buyer-Side NDA

A buyer-side M&A NDA is used when you (the potential acquirer) need to access confidential information about a target company during due diligence. While sellers typically propose the NDA, sophisticated buyers often negotiate significant modifications or propose their own form.

As a buyer, you want to ensure the NDA doesn't overly restrict your business operations, provides adequate carve-outs for your advisors, and includes reasonable terms for residual knowledge retention. At the same time, you need to respect the target's legitimate need to protect truly sensitive information.

Key Buyer Concerns

Buyers should pay particular attention to: (1) overly broad definitions of confidential information that could restrict normal business activities, (2) aggressive standstill provisions that limit your strategic options, (3) employee non-solicitation clauses that could impact post-acquisition integration, and (4) unreasonable survival periods that extend obligations long after a deal fails.

Buyer Priorities

  • Residuals Protection
    Ensure your team can use general knowledge and skills gained during diligence
  • Advisor Access
    Broad carve-outs for attorneys, accountants, and financing sources
  • Reasonable Term
    2-3 year confidentiality period, not indefinite obligations
  • Standstill Flexibility
    "Fall-away" provisions if seller entertains other offers

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Buyer-Side NDA Generator

Party Identification

Transaction Details

$10M - $50M

Material Information Categories

Select categories of information you expect to receive:

Duration & Survival

Buyer Protections

Standard Exclusions

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Confidentiality Agreement

This Confidentiality Agreement (this "Agreement") is entered into as of [DATE], by and between [BUYER NAME], a [STATE] corporation ("Buyer"), and [SELLER NAME], a [STATE] corporation ("Seller" or the "Company").

Recitals

WHEREAS, Buyer is considering a possible [TRANSACTION TYPE] involving the Company (the "Transaction"); and

WHEREAS, in connection with Buyer's evaluation of the Transaction, the Company may disclose to Buyer certain confidential and proprietary information concerning the Company's business, operations, and affairs;

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties agree as follows:

1. Definition of Confidential Information

"Confidential Information" means all non-public information concerning the Company, including but not limited to: financial statements, business plans, customer lists, supplier information, technology, trade secrets, and any other proprietary information disclosed to Buyer in connection with the Transaction, whether disclosed orally, in writing, or by inspection.

2. Use and Disclosure

Buyer agrees to: (a) use the Confidential Information solely for the purpose of evaluating the Transaction; (b) keep the Confidential Information confidential; and (c) not disclose the Confidential Information to any third party except as permitted herein.

3. Permitted Disclosures

Buyer may disclose Confidential Information to its directors, officers, employees, attorneys, accountants, financing sources, and other advisors who need to know such information for purposes of evaluating the Transaction, provided that such persons are informed of the confidential nature of the information and agree to be bound by confidentiality obligations no less restrictive than those contained herein.

4. Residual Knowledge

[RESIDUALS CLAUSE - Based on Selection]

5. Term

The obligations of confidentiality shall remain in effect for a period of [X] years from the date hereof; provided, however, that with respect to any Confidential Information that constitutes a trade secret, such obligations shall continue for so long as such information remains a trade secret under applicable law.

[Complete agreement will be generated upon submission...]

Residuals Clause

Allows retention of general knowledge and skills. Critical for buyers to avoid restricting normal business operations post-diligence.

Negotiate Carefully

Standstill Provision

Limits buyer's ability to acquire shares or make unsolicited offers. Seek "fall-away" triggers if seller shops the deal.

Key Buyer Concern

Non-Solicitation

Restricts hiring of target's employees. Negotiate for narrow scope (named individuals) rather than broad prohibition.

Negotiate Scope

Permitted Disclosures

Ensure broad carve-outs for advisors, financing sources, and potential co-investors or consortium members.

Standard Clause

Term and Survival

2-3 years is standard. Resist indefinite terms for general business information (trade secrets may warrant longer protection).

Check Duration

Return/Destruction

Include carve-outs for legally-required retention, automated backups, and compliance archives.

Standard Clause
Should the buyer ever propose the NDA?
While sellers traditionally propose NDAs, sophisticated buyers often have their own forms or heavily negotiate the seller's form. If you're a frequent acquirer, having your own buyer-friendly NDA can streamline negotiations and ensure consistent protections across transactions. The party with more leverage typically gets their form accepted with modifications.
What is a "residuals" clause and why is it important for buyers?
A residuals clause permits the receiving party to use general knowledge, ideas, and skills retained in the unaided memory of its personnel, even after the NDA ends. For buyers, this is crucial because your team will inevitably learn about industry practices, business models, and general approaches during diligence. Without a residuals clause, buyers risk claims that their normal business activities somehow breach the NDA.
What is a "fall-away" provision in a standstill clause?
A fall-away provision terminates or relaxes the standstill restrictions if certain triggering events occur - typically if the seller entertains another buyer's offer or publicly announces a willingness to sell. This protects buyers from being locked out while the seller shops the deal to others. Common triggers include: (1) seller entering into negotiations with a third party, (2) public announcement of a competing bid, or (3) seller's board recommending a third-party offer.
How should buyer handle employee non-solicitation?
Buyers should negotiate for the narrowest possible scope. Preferred approaches include: (1) limiting non-solicitation to specifically named key employees identified in a schedule, (2) excluding employees who respond to general advertisements or recruiter outreach, (3) setting a short duration (12 months maximum), and (4) excluding employees terminated by the target. Post-acquisition, you may want to retain key talent, so overly broad restrictions can complicate integration.
Can I share target information with potential co-investors?
This depends on the NDA's "permitted disclosures" section. Standard buyer-side NDAs should include carve-outs for potential financing sources and equity co-investors, subject to those parties agreeing to confidentiality. If you anticipate forming a consortium or seeking co-investors, ensure this is explicitly addressed in the NDA. Some sellers require notice or consent before sharing with co-investors.

Buyer NDA Help

Need help with your buyer-side NDA? Here are common questions:

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