2: Complete the NDA & Buyer Profile

Summary of the Process

A) Complete the NDA and Buyer Profile

B) We screen and approve your NDA and Buyer Profile

C) Provide additional source documents, if applicable

Introduction

If you wish to pursue a business represented by Morgan & Westfield, you must first sign a non-disclosure agreement and complete a buyer profile. After you have completed these two documents, you will receive additional information on the business, such as the CIM.

Please e-sign our NDA:

• Individuals: E-sign the NDA if you’re an individual
• Companies: E-sign the NDA if you represent a company
• Private Equity Firms: E-sign the NDA if you represent a private equity firm
• Family Offices: E-sign the NDA if you represent a family office
• Independent Sponsors: E-sign the NDA if you represent an independent sponsor
• Search Funds: E-sign the NDA if you represent a search fund

Non-Disclosure Agreement (NDA) and Buyer Profile

We require a signed non-disclosure agreement (NDA) and a fully completed buyer profile before we can reveal the name, location, and other details of a business we represent. We can release additional information regarding a company once we receive a signed NDA and complete buyer profile. 

Please note that we do not return phone calls requesting information on a business before an NDA is signed and buyer profile is completed as we are not able to provide any additional information prior to a signed NDA and a fully completed buyer profile.

All Parties Must Sign the NDA

Anyone receiving information on a business we represent must sign an NDA unless they are an owner or employee of your entity. This includes your partners and any investors who will be involved in the process. Investors and partners must also sign and be approved because they will have access to confidential information on the business. The only exceptions are your professional advisors (e.g., accountant, attorney), who are bound by professional ethics.

We Approve Your NDA and Buyer Profile Within 2 Business Days

We manually review and approve your NDA and buyer profile before we release any information on the business. You can expect a reply from us within two (2) business days of submitting the forms.

A Buyer Profile is Required

We require a completed buyer profile before we can release information on any business, even if you have the cash to acquire the business without financing. for many of the reasons listed below. Submitting a complete buyer profile will save you and the seller precious time and energy.

Some of the reasons we require a completed buyer profile include:

• Buyer Types: We target/avoid certain types of buyers for some of the businesses we represent. For example, some owners may prefer to target family offices, while other owners may want to avoid working with search funds. Having a completed buyer profile allows us to assess fit before releasing the seller’s confidential information and wasting your time.
• Preferred Exit Paths: Some sellers have a preferred exit path, which may exclude certain types of buyers. For example, if the seller does not wish to remain with the business, we may exclude private equity firms and prioritize individuals, search funds, and corporate acquirers.
• Confidential Information: Some sellers do not wish to disclose their information to certain types of buyers, such as direct competitors or those already working in their industry, due to the high risk associated with an information leak.
• Industry Experience: We also assess buyers’ experience in the industry and whether selling to a buyer lacking industry experience is suitable. If you lack the necessary industry experience, this will save you time and effort.
• Required Licensing: In licensed industries, we may target buyers who already possess the necessary licensing to mitigate risk for all parties and expedite the transaction.
• Other Criteria: We also evaluate buyers based on different criteria, such as business or management experience, and a completed buyer profile allows us to evaluate these criteria to assess fit carefully.
• Upside Potential: We may also evaluate any upside potential a corporate acquirer offers the seller if they wish to retain equity in the business post-closing.
• Buyer Liquidity: We prioritize potential buyers with higher liquidity and current liquidity to complete an acquisition and minimize financing risk.
• Potential Synergies: We evaluate corporate buyers based on the synergies that could be achieved from the acquisition. 
• Buyer Fit: If the seller wishes to remain with the business post-closing, we evaluate buyers based on whether they will be a good fit with the seller.
• Seller as a Guarantor: The landlord will want to ensure you’re both operationally and financially qualified. This is especially important when you take over the seller’s lease, and they remain as a guarantor. 
• Working Capital: We screen buyers to ensure they have adequate working capital post-closing.
• Acquisition History: For certain types of businesses, we prioritize buyers who have previously completed acquisitions.
• Cost of Due Diligence: Due diligence is a serious commitment for a seller. It can cost them tens to hundreds of thousands of dollars in attorney, accountant, and other professional advisor fees. It’s important we ensure a buyer is qualified before the seller makes this commitment.
• Risk of Fraud and Theft: Even if the buyer pays all cash and no third-party approvals are required, fraud and theft are still risks for any seller. The seller will give you access to highly sensitive information such as bank statements and tax returns. Ensuring you’re qualified gives them confidence that they’re dealing with a legitimate party.
• Transaction Risk: Selling a business is one of the most important and largest transactions in a business owner’s life and requires the release of a significant amount of highly sensitive information. It’s our professional duty to ensure all parties are screened and qualified before receiving the seller’s sensitive information.
• Other Criteria: We also evaluate buyers based on different criteria, such as business or management experience, and a completed buyer profile allows us to evaluate these criteria to assess fit carefully.

Why We Ask for Your Financial Information

Selling a business involves the release of private and highly sensitive information. We’re therefore professionally obligated to ensure all parties are qualified before disclosing confidential information regarding the business. We must screen potential buyers to verify they meet minimum financial requirements before any sensitive information is released.

Your Information Must be Verifiable

Once you submit a letter of intent (LOI), you may need to submit source documents, such as bank statements, a credit report, or a background check, to verify your financial ability to complete the transaction. False, inaccurate, incomplete, and misleading information will be discovered during negotiations, so it’s best to be forthcoming when you complete the initial forms.

Frequently Asked Questions

Can you disclose the financial requirements for a business I am interested in? No, we do not disclose the financial requirements for any business we represent. We recommend completing the buyer profile as accurately as possible, and we will let you know if you qualify to receive more information.

Can I only sign the NDA, and not complete the buyer profile if I can provide proof of funds? No, we require a completed buyer profile before we can release any additional information on a business we represent, even if you are paying all cash.

What documents can you provide me if I do not want to sign the buyer profile but am willing to sign the NDA? We are not able to provide any information without a completed buyer profile.

Do I need to sign a second NDA if I already signed one for another business you represent? Yes, you must sign one NDA for each business you are interested in; however, you do not need to complete a second buyer profile.

Do I need to list my financial information if I’m obtaining bank financing? Yes. We must ensure you meet the minimum requirements to obtain a bank loan, and meet other requirements, such as those imposed by third parties (e.g., landlord, licensing requirements, etc.).

Do I need to list my financial information if an investor is funding my acquisition? Yes, we require your financial information even if an investor is backing you. This is necessary to ensure you can meet any third-party requirements, such as those imposed by a landlord or in the event you propose a seller note as part of the transaction structure. If you’re working with an investor, they must also sign an NDA, and we must ensure they’re qualified as well. Please email us your investor’s email address, and we will send the NDA and buyer profile for them to complete. When completing the form, please reference your investor’s name and email address.

Do I need to provide my financial information if I’m paying all cash? Yes. We must ensure you can meet any third-party qualifications, such as those imposed by franchisors, landlords, or other third parties. Additionally, if the seller remains a guarantor on the lease, we must ensure you’re qualified.

Do I need to list the exact amount of my liquid funds? No, feel free to round the numbers (e.g., $1.1 million).

Do you disclose the minimum amount of liquid funds required for a specific business? No, we do not. We take multiple factors into account when assessing whether to approve a buyer and release confidential information, one of which is liquidity. If in doubt, we recommend listing the maximum amount of liquid funds you have available to invest.