Prepare my NDA

When to use this NDA scheme?

In an M&A process, the NDA is not a simple confidentiality form; it is the document that defines what you can share, with whom, for how long, and with what consequences if someone breaks the agreement. This scheme is designed for mid-market buy or sell processes in Mexico, not for generic service contracts or employment relationships.

• Before sharing sensitive business information, such as detailed financials, margins, commercial pipeline, or key contracts.
• When there are several potential buyers at the same time and you need order and traceability on who knows what.
• When you want the NDA to reflect market standard in mid-market M&A, not just a generic template downloaded from the internet.

What elements must be in an M&A mid-market NDA?

A solid NDA for a business sale or acquisition process in Mexico, at minimum, makes the following points clear.

• Parties and definitions
  Who is the discloser, who is the recipient, whether the NDA also covers affiliates, advisors, banks and related funds, and what Confidential Information means in the context of a transaction.

• Scope of confidential information
  What type of information is protected (financial, operational, commercial, tax, legal, technical) and what is excluded by definition (already public information, information the recipient knew before signing, received from a legitimate third party, or developed independently).

• Permitted use of information
  Information may be used only to evaluate a possible transaction between the parties, not to compete, hire the target's personnel, or contact customers and suppliers on your own account.

• People authorized to receive information
  Employees, officers, external advisors, banks, funds or co-investors who need to know it and who are bound by confidentiality obligations equal to or stricter than the NDA.

• Safeguards
  Reasonable standard of care (access control, physical copies, file sharing, data rooms) and obligation to notify security incidents or unauthorized disclosures.

• Duration of confidentiality
  Specific term, e.g. 3 to 5 years from signing or from last disclosure, and whether some obligations survive indefinitely, such as those relating to trade secrets.

• No obligation to close the deal
  Clarity that neither party is obliged to close the transaction merely because they signed the NDA or received information.

• Return or destruction of information
  What happens to physical and electronic documents if the transaction does not close: return, certified destruction, or limited retention for legal reasons.

• Remedies for breach
  Possible damages, injunctive relief, and governing jurisdiction. In M&A it is often critical to be able to seek quick relief to prevent greater harm.

What common mistakes weaken an NDA?

Many template NDAs fail exactly where it matters most in a business transaction. These are mistakes that in practice weaken your position.

• Vague definitions of confidential information
  Generic wording that does not land in the M&A context allows later disputes over whether certain data was covered or not.

• Confidentiality periods that are too short
  One- or two-year obligations may be insufficient when the information has competitive value for longer.

• Lack of clear scope for affiliates and advisors
  If the NDA does not explicitly cover the buyer's banks, funds, co-investors or advisors, it opens a leak for information.

• Silence on competitive use of information
  Without an express restriction, a competitor can argue it used its own information to compete, even if it obtained it during the process.

• No clear obligation to return or destroy
  Leaving open the possibility that the recipient keeps copies indefinitely complicates risk management after a failed process.

What does the NDA tool give you?

The tool does not draft a contract for you; it organizes the work with your lawyer so the NDA you sign reflects these minimums.

• Checklist of critical points to review
  Actionable list of each element that should be in the NDA and space to mark whether it is covered, pending or not applicable.

• Summary of risks if you sign as-is
  List of the most obvious risks given your criteria, e.g. short duration, weak definitions or lack of coverage for affiliates.

• Questions for your lawyer
  Specific questions so your lawyer can adapt the NDA to the Mexican M&A context and your company's particular risk.

• Downloadable PDF version
  A PDF with the checklist and summary to share with partners, board or advisors without forwarding emails or screenshots.

How to use this scheme with your lawyer?

1. Complete the checklist before sending the NDA
   Capture who each party is, what type of process you are running and how much competitive risk there is if key information leaks.

2. Mark what you do see in the current draft
   Review the NDA on the table and mark, point by point, what is covered, what is weak and what is missing.

3. Take the summary to your lawyer
   Share the structured view of risks and priorities so the legal review is precise, not generic.

4. Adjust the NDA before sharing sensitive information
   The goal is for the NDA to reflect market standard and the reality of your operation before opening the data room or sharing full financials.

What are the limitations?

This scheme does not replace a lawyer's work nor is it legal advice. Its purpose is to help you reach that conversation with clarity on what you need the NDA to cover and what concessions you are willing to make.

• It is not a contract template; it is a checklist to structure the review in an M&A context.
• It does not address tax, labor or regulatory specifics, which always require case-by-case review.
• It assumes an M&A transaction is in mind; for other types of agreements, the critical points may differ.