A business broker is a person or firm engaged in the business of enabling other businesses to get sold.
Business brokers typically value the business, advertise it for sale, handle the initial discussions with prospective buyers and assist the owner of the business in selling it. They are paid either a fixed fee or a percentage of the sale price. Buyers sometimes retain a business broker to find them a particular kind of business.
In the United States, licensing of business brokers varies by state, with some states requiring licenses, some not. Some states require licenses if the broker is commissioned but not if the broker works on an hourly fee basis. State rules also vary about recognizing licensees across state lines, especially for interstate types of businesses like national franchises. Some states require either a broker license or law license to even advise a business owner on issues of sale, terms of sale, or introduction of a buyer to a seller for a fee.
This form is a general Non-Disclosure and Commission Agreement Between a Business Broker and a Prospective Buyer.
A Maryland Nondisclosure and Commission Agreement Between Business Broker and Prospective Buyer is a legally binding agreement that establishes the terms and conditions under which confidential information about a business for sale is shared between a business broker and a potential buyer. This agreement aims to protect the sensitive and proprietary information of the seller while ensuring the broker's entitlement to a commission if the buyer purchases the business. The main purpose of the Maryland Nondisclosure and Commission Agreement is to maintain the confidentiality of the disclosed information by preventing the prospective buyer from using, disclosing, or sharing any details about the business with unauthorized individuals or entities. This ensures that the seller's competitive advantage is not compromised during the sales process. Some common elements included in such an agreement are: 1. Confidential Information: The agreement will explicitly define what constitutes confidential information, which typically includes financial statements, customer lists, marketing strategies, business plans, trade secrets, and any other proprietary information related to the business being sold. 2. Nondisclosure Obligations: The prospective buyer is obligated to keep all disclosed information confidential and agrees not to use it for any purpose other than evaluating the potential purchase of the business. They must also ensure that any employees or advisors involved in the evaluation process comply with the confidentiality requirements. 3. Non-Compete Clause: To protect the seller's interests, the agreement may include a non-compete clause, which restricts the prospective buyer from engaging in similar or competing business activities for a certain period of time within a specified geographical area. 4. Commission Agreement: The document establishes the terms of the business broker's compensation, usually a commission based on a percentage of the final sale price. It outlines when and how the commission is paid, and clarifies if any expenses will be reimbursed by the buyer or included in the commission. 5. Term and Termination: The agreement will specify the duration for which the nondisclosure obligations remain in force, often a certain number of years after the execution of the agreement. It may also outline the conditions under which the agreement can be terminated, such as completion of the transaction, a breach by either party, or mutual consent. Different types of Maryland Nondisclosure and Commission Agreements may exist depending on the specific circumstances of the business sale. For example, there might be variations for agreements used in specific industries, such as real estate, healthcare, or technology. However, the core elements of confidentiality, non-disclosure, non-compete, commission, and termination will generally be present in all types of these agreements.A Maryland Nondisclosure and Commission Agreement Between Business Broker and Prospective Buyer is a legally binding agreement that establishes the terms and conditions under which confidential information about a business for sale is shared between a business broker and a potential buyer. This agreement aims to protect the sensitive and proprietary information of the seller while ensuring the broker's entitlement to a commission if the buyer purchases the business. The main purpose of the Maryland Nondisclosure and Commission Agreement is to maintain the confidentiality of the disclosed information by preventing the prospective buyer from using, disclosing, or sharing any details about the business with unauthorized individuals or entities. This ensures that the seller's competitive advantage is not compromised during the sales process. Some common elements included in such an agreement are: 1. Confidential Information: The agreement will explicitly define what constitutes confidential information, which typically includes financial statements, customer lists, marketing strategies, business plans, trade secrets, and any other proprietary information related to the business being sold. 2. Nondisclosure Obligations: The prospective buyer is obligated to keep all disclosed information confidential and agrees not to use it for any purpose other than evaluating the potential purchase of the business. They must also ensure that any employees or advisors involved in the evaluation process comply with the confidentiality requirements. 3. Non-Compete Clause: To protect the seller's interests, the agreement may include a non-compete clause, which restricts the prospective buyer from engaging in similar or competing business activities for a certain period of time within a specified geographical area. 4. Commission Agreement: The document establishes the terms of the business broker's compensation, usually a commission based on a percentage of the final sale price. It outlines when and how the commission is paid, and clarifies if any expenses will be reimbursed by the buyer or included in the commission. 5. Term and Termination: The agreement will specify the duration for which the nondisclosure obligations remain in force, often a certain number of years after the execution of the agreement. It may also outline the conditions under which the agreement can be terminated, such as completion of the transaction, a breach by either party, or mutual consent. Different types of Maryland Nondisclosure and Commission Agreements may exist depending on the specific circumstances of the business sale. For example, there might be variations for agreements used in specific industries, such as real estate, healthcare, or technology. However, the core elements of confidentiality, non-disclosure, non-compete, commission, and termination will generally be present in all types of these agreements.
