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.
The Tennessee Nondisclosure and Commission Agreement Between Business Broker and Prospective Buyer is a legal contract formulated to establish a confidential relationship between a business broker and a potential buyer during the process of considering the purchase of a business. This agreement safeguards sensitive information and ensures that both parties adhere to strict confidentiality guidelines. The agreement begins by defining the parties involved, specifically the business broker and the prospective buyer. It also outlines the purpose of the agreement, which is to provide the prospective buyer with access to confidential information about the business being offered for sale. The agreement emphasizes the importance of maintaining the confidentiality of the disclosed information. It requires the prospective buyer to use the information solely for the purpose of evaluating the potential purchase of the business and to refrain from disclosing any details to third parties without the prior written consent of the business broker. The agreement encompasses various aspects related to the nondisclosure of information, including trade secrets, business strategies, financial records, customer lists, intellectual property, and any other proprietary or privileged information shared by the business broker. It further prohibits the prospective buyer from contacting current or former employees, suppliers, or customers of the business without the broker's consent. Both parties are bound by this agreement even after the termination or completion of any potential business transaction. It ensures that the confidentiality obligations persist, and any violation may result in legal actions, including injunctive relief and monetary damages. Additionally, this agreement addresses the issue of commission payable to the business broker in the event of a successful business transaction. It outlines the terms and conditions for the payment of commission, including the agreed percentage and the basis for calculation (such as the purchase price or net profit). Any potential adjustments or conditions related to commission payment are also specified within the agreement. It is important to note that while this description specifically pertains to a Tennessee Nondisclosure and Commission Agreement Between Business Broker and Prospective Buyer, there may not be different types of such agreements specific to Tennessee alone. However, businesses may customize their agreements to suit individual needs, which can result in minor variations in different agreements.
