Hey all,

I've been approached to sell my company (small company) but to sell it i have to tell the buyer how the company works. How can I protect the secrets so that if the sale doesn't go through they don't squash me (it's a bigger company).

Is a non-disclosure agreement enough? Is there a non-compete? What if they're already doing some of the things I do, a non-compete wouldn't work?

I'll contact a lawyer, but just wanted a basic idea of what I'll need to do.

Big T

Tony:

I recommend that you have an iron-clad non-disclosure/confidentiallty agreement (NDA) in place before you release any private info. The NDA can also limit the prospective buyer's review of your private info to financial statements only. In such a situation, you will not need a non-compete clause in the NDA.

I would not reveal any trade secrets without a non-compete. I dont care who the company is. Thats like giving away your business.

Once, the prospect gets past the financial statement review, and they sign the non-compete, (and they leave a cash deposit held in escrow), then upon your attorney's recommendation you might allow them to review some trade secret info.

Hire an attorney to draft and control the documents. Whatever it costs, it will be worth it as your attorney will protect your a**.


Good luck.

The problem is enforcement of the NDA. The fees to litigate and stake a claim will be expensive. Also, proving loss will be difficult.

Maybe, require arbitration as a form of judicial resolution.

Why not leave money in an attorney escrow account? That would weed out tire kickers and provide compensation for the damaged party. I only problem is determining how much of a retainer to take upfront as it may look like to is to be your full settlement.