Question: Why do we need this?
Answer: To protect relationships.
Any Seller of a business has relationships with folks such as staff, suppliers, customers, competitors . . .
Rumors or stories that the firm may be ‘in play’ can create uncertainties in any of these relationships.
Uncertainty means staff might be more tempted to take another offer, suppliers may look for other distributors, competitors might gossip saying the seller is in trouble and needs to sell . . . This is all best nipped in the bud.
We stop this with the non-disclosure agreement. It helps sellers to avoid these uncertainties until a deal has been finalized.
Only then can the Seller address how these relationships may or not change from a position of knowledge rather than speculation.
Please click this link to download the .pdf file containing our Non-Disclosure Agreement.
We need the signed before releasing any information that might identify a business.
Our contact info is on the non-disclosure form. Send it by fax or scan and email it to us.
Or most smart phones can also take a picture of your signed document that you can email to us. Send each page one at a time but we need all the pages.
We don’t care how the signed copy gets here as long as we have it on file to show our Seller.
A Seller may also give us instructions abbreviated into time, talent and treasure about who can see his information. For example, an accounting practice can only be bought by a qualified accountant so only qualified accountants can see this information.
We should not need any more paperwork than this. Your verbal assurance that you meet whatever criteria that a Seller has set such as skill set or financial capacity to complete a purchase is all we should need.
The form also has paragraphs addressing dual agency. Dual Agency can lead to conflicts of interest and they say more lawyers lose their licenses through dual agency than through dipping into their trust funds.
Unlike Realtors and their signed contractual offers, business brokers do not deal in contracts. I will guide you and the seller toward a non-binding handshake agreement on the commercial terms.
This is called a letter of intent in its written form. The Buyer will first take this agreement-in-principle to his accountant for his advice on the tax and other implications of the proposed deal.
Then he will take the accountant’s advice and the letter of intent to his lawyer to be drawn up into a formal purchase contract for review by the Seller’s lawyer.
In the normal course of events, there should only be signed contractual purchase obligations upon your lawyer’s advice.