As a business owner, you may consider hiring a broker to help you sell your business. A broker can save you time and effort by handling the sale process on your behalf. However, before hiring a broker, you need to sign a listing agreement that outlines the terms of the engagement. In this article, we will discuss the key elements of a business broker listing agreement sample.

Introduction

The introduction of the listing agreement should identify the parties involved in the agreement: the seller, the broker, and any other relevant parties. It should also state the purpose of the agreement, which is to engage the broker`s services to sell the seller`s business.

Listing price

One of the most critical elements of the listing agreement is the listing price. The listing price is the price at which the seller agrees to sell the business, and it should be based on the broker`s valuation of the business. The listing agreement should include the listing price and specify whether it is negotiable or firm.

Commission

The commission is the fee that the broker will charge the seller for their services. The listing agreement should specify the commission percentage and whether it is negotiable or non-negotiable. In most cases, the commission is a percentage of the sale price, and it can range from 5% to 15%, depending on the size and complexity of the business.

Listing term

The listing term is the period during which the broker has the exclusive right to sell the business. The listing agreement should specify the listing term, which can range from 90 days to one year, depending on the complexity of the business and the market conditions.

Services

The listing agreement should also outline the services that the broker will provide to the seller, such as preparing the marketing materials, conducting buyer screenings, and negotiating the sale. It should also specify any additional services that the broker will provide, such as financing assistance or due diligence support.

Confidentiality

The listing agreement should include a confidentiality clause that protects the seller`s confidential information, including financial statements, customer lists, and business strategies. The clause should specify the parties that are allowed to access the information, the conditions under which they can disclose it, and the penalties for violating the agreement.

Termination

The listing agreement should specify the conditions under which the agreement can be terminated, such as breach of contract, failure to perform, or mutual agreement. It should also outline the consequences of termination, such as the return of any confidential information or the payment of any outstanding commissions.

Conclusion

In conclusion, a business broker listing agreement is an essential document that outlines the terms of engagement between the seller and the broker. It should include the listing price, commission, listing term, services, confidentiality, and termination conditions. A well-crafted listing agreement can help the seller and the broker achieve their respective goals and ensure a successful business sale.