This Confidentiality & Non-Disclosure Agreement ("Agreement") is made and entered into by the Brokerage and Buyer in relation to the disclosure of Confidential Information (as defined herein), the Buyer's restrictions on dealing in respect of the Business/Property (as defined herein), and the proposed Transaction (as defined herein). In consideration of the premises, rights, and obligations set forth below, the parties hereby agree as follows:
WHEREAS:
A. The Brokerage Agreement with the Seller requires that a signed Confidentiality and Non-Disclosure Agreement and evidence of the Buyer's financial ability be obtained before disclosing the name, location, or financial details of the Business, and that all information provided will be kept confidential;
B. Buyer has expressed an interest in the acquisition, merger, and/or otherwise (the "Transaction") in respect of the Business/Property;
C. Brokerage is engaged by and/or represents the seller of the Business/Property ("Seller") in the Transaction;
D. Brokerage is authorized to disclose to Buyer certain information concerning the Business/Property to assist in Buyer's due diligence related to the Transaction;
E. Buyer desires to receive certain information concerning the Business/Property to evaluate the Transaction;
F. Buyer and Brokerage understand that the Seller requires that the evaluation of the Transaction, the Business/Property, and all information disclosed in relation thereto shall be treated as strictly confidential;
NOW THEREFORE, in consideration of the mutual covenants and agreements and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
1. BUYER'S OBLIGATIONS
1.1. "Confidential Information" in this Agreement shall include but is not limited to the following:
a. All communications between the Seller and Brokerage, and all material supplied to Buyer(s) by Brokerage or acquired during inspections of the Business/Property;
b. All financial information including Income Statements, Balance Sheets, and Statements of Retained Earnings (deficit) of the Business/Property;
c. All information concerning the operations of the Business/Property;
d. All information concerning the shareholders of the Business/Property;
e. All information concerning the lenders of the Business/Property;
f. All information concerning the transactions and financial arrangements of the Business/Property;
g. All financial and non-financial information that has been disclosed;
h. All marketing material supplied as part of the transaction process, including Confidential Information Memorandums and Confidential Business Overviews;
i. The fact that the business is for sale.
Confidential Information does not include information available to the public, published by the Seller or Brokerage, and/or already in the Buyer's possession free from any obligation of confidentiality. All information disclosed by Brokerage or Seller shall be deemed Confidential Information unless expressly stated in writing to be non-confidential.
1.2. The Buyer confirms it is not an agent of the Canada Revenue Agency and that none of the information obtained herein will be used for, or provided to, the Canada Revenue Agency or any other governmental authority or body.
1.3. The Buyer, including all officers, employees, and professional consultants, is strictly prohibited from using Confidential Information for any purpose other than the evaluation of the Transaction and Business/Property. The Buyer is further prohibited from disclosing Confidential Information to any person, firm, or corporation without the prior written consent of the Brokerage or Seller. All officers, employees, and professional consultants/advisors must be disclosed to and approved by the Brokerage prior to the release of any confidential information.
1.4. The Buyer shall take all reasonable steps to minimize the risk of disclosure of Confidential Information by ensuring that only Brokerage-approved persons possess such information, that those persons are instructed to treat it as confidential, and that secure storage is provided for all written Confidential Information. Access is limited to individuals whose duties require it, following written approval by the Brokerage.
1.5. If no Transaction related to all or part of the Business/Property is concluded with the Seller, the Buyer, including all officers, employees, and professional consultants, will continue to be bound by this Agreement.
1.6. Confidential Information, together with any copies thereof — except for analysis, compilations, or other documents prepared by the Buyer — will be returned to the Brokerage immediately upon request. Any work product prepared by the Buyer must be securely deleted and disposed of within 5 days of such request.
1.7. The Buyer agrees to strictly refrain from contacting or engaging with any officers, directors, employees, representatives, or agents of the Business/Property unless permission has been granted by the Brokerage and/or Seller. The Buyer acknowledges that it will remain legally liable for any and all breaches of this section to the full extent of the law.
1.8. The existence of this Agreement does not obligate the Brokerage to provide Confidential Information to the Buyer. All provision of information remains at the sole discretion of the Brokerage.
2. ACKNOWLEDGEMENT OF BROKERAGE REPRESENTATION AND RESTRICTIONS ON DEALING
2.1. This Agreement applies solely to this Business/Property and Transaction and does not extend to any other business or transaction involving the Brokerage, Buyer, Seller, and/or any other third party.
2.2. Subject to Sections 2.3 and 2.4, the Buyer acknowledges that the Brokerage is to be compensated for facilitating the Transaction by way of a commission payable by the Seller. The Buyer understands that the Brokerage and its associates represent the Seller under a listing agreement and agrees not to circumvent this arrangement in any way. The Buyer agrees to protect the Brokerage's right to a commission if they purchase, lease, or become connected in any way with a business represented by the Brokerage, and understands that interference with this right may result in direct liability for payment of the commission.
2.3. The Brokerage acknowledges that all commission fees are due from the Seller. No fees will be levied to the Buyer unless specifically agreed to in writing by both parties in a separate agreement.
2.4. The Buyer acknowledges and agrees to respect and adhere to the Brokerage's rules and procedures, including but not limited to:
a) The Buyer and/or their agents or representatives will not introduce any other potential buyer to the business except through the Brokerage, and will not circumvent or attempt to circumvent this Agreement in any way.
b) The Buyer will not contact the Seller directly at any time without first obtaining permission from the Brokerage.
c) The Buyer agrees to, and/or will cause their lawyers to, deliver all correspondence, offers, and documentation directly through the Brokerage, which will in turn review all materials with the Seller and their legal counsel.
d) Deposit monies shall be held in the Brokerage's Trust Account, which is insured for the protection of the Buyer.
e) The Buyer may be subject to a credit check at the time of offer acceptance.
2.5. In the event that the Buyer contravenes Section 2.4 and subsequently buys, leases, manages, negotiates an option to buy, or otherwise comes into possession of the Business/Property or its shares and/or assets — directly or indirectly — within three (3) years from the termination of this Agreement, the Buyer shall be solely responsible and liable for any commissions otherwise payable to the Brokerage.
2.6. The Buyer acknowledges and agrees that neither the Brokerage nor the Seller shall be responsible for any expenses, fees, commissions, or other payments owed to any of the Buyer's representatives.
2.7. All information provided to the Buyer by the Brokerage has been received from the Seller or the Seller's representatives and has not been independently verified by the Brokerage. The Brokerage makes no representations, either expressed or implied, concerning the accuracy of the information provided.
2.8. The Seller, including its officers, directors, shareholders, and all other representatives, reserves the right, in their sole discretion, to reject any and all proposals made by the Buyer, to terminate discussions and negotiations, to terminate the Buyer's participation in the sale process, and to modify or terminate the sale process at any time.
2.9. The Buyer warrants by their signature below that they either:
a) are NOT currently in an active Buyer Agency Agreement with a Registered Real Estate Brokerage in Ontario for the purchase of a business or investment; or
b) undertake to advise any and all representatives that pursuant to this Agreement: (1) said representative(s) are not entitled to any fees or commission from the Brokerage and/or Seller; and (2) the Buyer is solely responsible for any fees or commissions related to their representation in respect of any Transaction relating to the Business/Property.
3. AGENCY DISCLOSURE
3.1. The Buyer acknowledges that the Brokerage represents the interests of the Seller and does not represent the Buyer. All fees due are, and will be, the responsibility of the Seller. As the Seller's agent, the Brokerage acts under a listing agreement and has fiduciary obligations to the Seller including loyalty, obedience, disclosure, confidentiality, reasonable care and diligence, and accounting. The Brokerage also has obligations of honest dealing and disclosure to both parties. Nothing in this Agreement prevents the Buyer from retaining their own independent business broker; however, the Brokerage is not obliged to share its commission with any broker retained by the Buyer when the MLS system is not used.
3.2. The Buyer is solely responsible for disclosing to all of their representatives that any fees payable in respect of any Transaction relating to the Business/Property are the sole responsibility of the Buyer and not the Brokerage and/or Seller.
4. INFORMATION DISCLOSURE
4.1. The Buyer acknowledges that all information on each business opportunity provided by the Brokerage has been supplied by the Seller for the sole and confidential purpose of evaluating a potential acquisition. While the Seller believes this information to be true and accurate, accuracy is not guaranteed and all information should not be considered complete. The Brokerage makes no representations or warranties, expressed or implied, regarding information provided to the Buyer. It is the Buyer's sole responsibility to independently verify all information. The Buyer agrees to indemnify and hold the Brokerage harmless from any claims or damages resulting from use of the information provided. Under no circumstances shall the Brokerage be liable if confidential information is found to be incomplete, inaccurate, misleading, or false.
4.2. The Buyer confirms that their interest in the Confidential Information is limited to the potential purchase of the Business/Property and that they are not an employee of, or affiliated with, the Canada Revenue Agency or any governing body with an alternate motive for obtaining such information.
5. RISK DISCLOSURE
5.1. Business opportunities carry inherent risks including obsolescence, reduced demand, regulatory changes, ineffective management, and shifts in local or national economic conditions. A Buyer could incur a loss, including their entire investment. The Buyer acknowledges an understanding of these risks and recognizes that the Brokerage cannot and does not warrant or guarantee the future viability or prospects of any business.
6. COUNSEL DISCLOSURE
6.1. The Buyer is strongly advised to seek independent counsel from a lawyer, Chartered Professional Accountant, and any other qualified professionals necessary to make an informed decision regarding the purchase of any business opportunity facilitated through the Brokerage.
7. TERM AND TERMINATION
7.1. This Agreement shall begin on the Effective Date and remain in effect for the longer of:
a) the closing of any Transaction in relation to the Business/Property; or
b) one (1) year ("Term"), unless terminated earlier as set forth in this Agreement.
7.2. Subject to Section 3.1, this Agreement shall automatically renew for successive one (1) year periods ("Renewal Term") upon expiry of the Term or any Renewal Term.
7.3. The Brokerage may terminate this Agreement at any time without notice or further payment if the Buyer is in breach of any terms of this Agreement.
7.4. The Buyer agrees to provide thirty (30) days' written notice to the Brokerage to terminate this Agreement.
Sections 1, 2, 3, and 4 shall survive the termination of this Agreement.
8. CANADIAN ANTI-SPAM COMPLIANCE
8.1. In compliance with Canada's Anti-Spam Legislation (CASL), the Brokerage is required to obtain your express consent before sending electronic communications about new business listings that may be of interest to you. If you wish to be notified by email when new listings are added, please provide your express consent below.
9. MISCELLANEOUS
9.1. The parties agree to accept facsimile or electronically scanned transmissions of this document as originals. The undersigned hereby acknowledges having received a copy of this Agreement on the date indicated above.
