NDA Documents – They’re Important

If you respond to one of our listings, be prepared to complete all the documents we send to you.

When we send out our Non-Disclosure documents to folks who inquire about one of our listings I’m always amazed by how many people who seem to be so interested in buying a business refuse to complete all three documents.  Each one of the components of our NDA package is important to doing our job, for both the seller and the buyer.

Non-Disclosure Agreement

We’ve attempted to make this document non-threatening.  You and your advisors agree not to share the information that’s been provided – that’s it.  The NDA doesn’t bind the individual to our firm in any way.  They are free to work with other brokers.  We only ask that they keep the information confidential.

In addition, our NDA includes a paragraph that states, “Sunbelt correspondingly will keep all personal and financial information provided by you CONFIDENTIAL and will not release this information without your approval.”

Buyer Disclosure Acknowledgement

It’s important to us that a prospective buyer goes into the engagement with their eyes wide open and to understand the role and responsibilities of the broker they are working with.  (There are instances where we have a buy-side engagement in place where we’re working for the buyer.  However, for the most part, and for this article, let’s assume the inquiry is for one of our seller listings.)

The Buyer Disclosure Acknowledgement is made up of four paragraphs:

Agency Disclosure

As the seller’s agent we have obligations to the seller including the fiduciary duties of loyalty, obedience, disclosure, confidentiality, reasonable care and diligence and accounting in dealing with the seller. In addition, a seller’s agent has affirmative obligations to the Buyer and Seller of honest dealing and disclosure.

Counsel Disclosure

Buyers are advised to seek counsel from an attorney, Certified Public Accountant and any other parties necessary to make an informed decision regarding the purchase of any business opportunity bought or sold through Sunbelt Business Advisors.

Information Disclosure

We need the buyer to understand and acknowledge that all information and material on each business opportunity provided by Sunbelt has been provided to Sunbelt by the seller of the business. The seller believes that information to be true and accurate; however, accuracy is not guaranteed and it is the responsibility of the buyer and advisors to perform due diligence and test the information for accuracy.

Risk Disclosure

Business opportunities by their very nature carry risk. Some of these risks included obsolescence or reduced demand for service or product, regulatory laws, ineffective management, changes in the local or national economic condition, and many others. Due to the risks inherent in business opportunities, a buyer could incur a loss, including but not limited to their entire investment. Buyer acknowledges that they understand these risks and that Sunbelt Business Advisors cannot and does not in any way warrant or guaranty the future vitality or prospects of any business.

Buyer Questionnaire

This is the document that prospective buyers are most reluctant to complete, even with the statement in the NDA that we will keep their information confidential too.  While I understand their reluctance, we can’t move forward without having this information and here’s why:


It’s important for us to understand the background, experience and skill sets of the buyer and match those to the needs of the business.  This exercise is not to discourage buyers, but to make sure they understand the reality of what the business needs to ensure post-close success.

Snapshot of Financial Situation

The request for a buyer’s financial overview isn’t idle curiosity.  Every day we work with lenders on financing acquisitions.  We know what a bank needs; the SBA lending requirements and how to structure a deal.  By understanding what capital a buyer has and where they have it, allows us to have a frank discussion of a realistic price point for them to consider.  Knowing if there’s a large amount of equity in real estate or investments in a 401K can assist us in making suggestions on how to unlock those assets for a down payment and working capital.  At the other end of the spectrum is realizing if there isn’t enough capital to for a specific deal and suggesting other acquisition options.

We have an obligation to our client to only work with serious, qualified buyers.  By completing our NDA package a buyer takes the first step in building the mutual trust necessary to move through the process.  If the buyer won’t share any information with us, why then should we share the most confidential information the business owner possesses?

To paraphrase Jerry Maguire – Help us to help you, by completing the documents and taking the first step towards buying your business.

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Sunbelt is proud to be the world’s largest business brokerage network. Each of our offices is independently owned and operated by an experienced and professional owner who lives and works in the community in which they operate.

Disclaimer: No salesperson, field representative or other person has the authority to make a statement, promise or assurance concerning any matter related to the franchise that is contrary to, or different from, the information/terms contained in the Franchise Disclosure Document/Franchise Agreement. Any such statement, promise or assurance is unauthorized, unwarranted and unreliable. If you believe someone has made an unauthorized statement, promise or assurance to you, please contact Jessica Czekalinski, Esq. at 216-674-0645 ext. 619.