Customer Authorization Of Disclosure Of Financial Records: Fill & Download for Free

Banks have many possibilities and business use cases to choose from as they enter this market, involving the currencies themselves, the underlying distributed-ledger technologies (DLTs), or both. In the currency domain, they can help startup ventures bypass the ordinary capital markets through ICOs, where the coin offering becomes the primary vehicle for funding the new enterprise. Banks and investment firms can help customers invest directly in cryptocurrencies, steering them toward the relatively few offerings that are likely to succeed (by attracting enough customers to become hubs of activity). For sophisticated customers, one option is tokenization investments, which are a cryptocurrency-based analog to securitization, bringing a variety of investments together in tranches.Firstly, If you are new to Cryptocurrency and you are looking for the best place to invest, I will recommend CryptoFXnetwork Cryptocurrency Investment Platform (www . cryptofxnetwork . com) as it is relatively new (launched at mid-summer 2018) but has become the largest cryptocurrency Investment Platform there is right now (total volume over 4 billion dollars) where you start getting returns of your invested cryptocurrency after 10 days. Supports variety of cryptocurrency like Bitcoin, Ethereum, Bitcoin Cash, Litecoin and other Altcoin. I find that it has a really nice UI and support.NOTE: I recommend the consultation of a financial professional who would have a perfect knowledge of the financial and patrimonial situation of the recipient of this message and would be able to verify that the financial products mentioned are adapted to the said situation and the financial objectives pursued. This above mentioned is based on my own experience dealing with CryptoFXnetwork.Banks can also provide currency-trading services (for example, in bitcoins or digital euros if they are offered) and crypto-enabled digital payments and transactions. These coin swaps can be offered through three types of exchanges: central-bank digital currencies (CBDCs) issued from national financial authorities, private blockchain-based currencies from a bank or company, and network-issued currencies, such as Bitcoin or Litecoin, with a public blockchain.As for deploying DLTs, banks can do this for either front- or back-office operations. They can offer real estate investments in which the blockchain technology makes the transactions more trustworthy. Crypto or blockchain technologies can be used to set up smart-contract offerings, with automated time stamps, updates, and verification of milestones.To some extent, bankers should take a cue from their clients and customers, who are moving rapidly to advance in the most relevant directions and may request crypto-oriented services from their banks. Large investors may be interested in crypto-based growth assets or in having their banks offer transaction-monitoring services based on DLTs. Venture capital funds tend to favor designated crypto funds and other vehicles for raising capital for startup investments, while retail clients may be looking for rapid-growth investments to diversify their portfolios.One promising approach is to integrate cryptocurrency with established payment platforms or other existing offerings. The UK-based fintech startup Revolut does this with its money transfer options. When people post a money transfer transaction, they are asked if they want it sent in pounds, dollars, euros, or one of five cryptocurrencies, which are stored in a pooled wallet. Those who choose cryptocurrencies may want to add to this part of their portfolio or may be preparing for other crypto transactions coming up in the near future. Customer fees take the value of this convenience into account. Other retail banks could take the same approach to integrating cryptocurrency into their existing products and services.MITIGATING RISKWhen offering products in this fast-developing sector, banks need to protect themselves and their customers against the risks that such new technology can bring.In March 2019, the Basel Committee on Banking Supervision stated that crypto-related assets “do not reliably provide the standard functions of money and are unsafe to rely on as a medium of exchange or store of value.” It suggested that four practices are essential with any offering: due diligence on each cryptocurrency offered to customers, an internal governance and risk management framework, disclosure of all related activities in financial statements, and an appropriate dialogue with regulatory supervisors.All these practices are significant, and due diligence is particularly important. Some cryptocurrency offerings have been associated in the past with “dark money” transactions: illicit trade and criminal activities, including ransom and extortion payments. In a few publicly identified cases, terrorist groups financed themselves with cryptocurrency. Tax evasion also remains a concern, and classification is difficult in some jurisdictions where regulators have not determined consistently whether to treat cryptocurrencies as assets, currencies, securities, or commodities.In practicing due diligence of this sort, banks can rely on three types of solutions: know your transaction (KYT), structured regulatory compliance (SRC), and custodian services. (See Exhibit 4.) These can be outsourced, but banks may benefit from bringing them in-house and making them substantial parts of the institution’s own crypto service chain. Together, these three solutions can build trust and address most concerns. They do not always need to be handled separately by each bank. Ultimately, the financial services industry will probably establish practices and platforms that embed these safeguards into every credible cryptocurrency offering.KYT: Beyond Customer VerificationVerification has long been an issue for cryptocurrencies because of the standard way that banks establish trustworthiness. When they bring a new client onboard, they rely on know your customer (KYC) verification, which regulators have required for many larger exchanges for at least a year. This might involve government identification, proof of employment, reliable collateral, and credit references. But KYC is a check only on the customer and not on the transaction, so it may not detect all cases of counterfeiting and money laundering. Some smaller exchanges do not use KYC, and it generally applies just to retail customers. The task of tracing any transaction back to the original source is often too onerous and costly for banks, especially at scale. As a result, counterfeiting and money laundering frequently go undetected.But the blockchain technology enables KYT, which can be used to easily track almost all transactions back to their sources. (See Exhibit 5.) The digital ledger automatically stores the complete history of currency exchanges and payments, in a distributed record that cannot be faked or tampered with in any way. Moreover, the KYT process can include analytics that recognize patterns of behavior associated in the past with criminal activity and set off alarm bells when those patterns occur.To be sure, the technology will not solve all verification problems or address the risks associated with cryptocurrencies, but as Bank for International Settlements (BIS) economist Raphael Auer notes, “It might open up new ways of supervising these risks.” In a 2019 BIS working paper, Auer proposed a concept called “em-bedded supervision,” in which digital ledgers are continually monitored for transgressions. In other words, rather than fitting new crypto offerings into estab-lished regulatory-compliance practices, technologies are put in place to track and reveal problems as they occur.KYT does not replace KYC; they complement one another. Exchanges and banks can use them together in order to establish a scoring system, ranking potential customers according to (for example) the reputation of transaction partners or the timing as well as the geographic location of particular transactions. In this way, KYT could enable banks to meet their anti-money-laundering and financial-crime compliance obligations while increasing customer trust. Strong KYT programs might also make banks more willing to process transactions that would otherwise be prohibited by their internal policies. That would encourage customers to keep their business with the bank, rather than taking it to competitors.In addition, banks often need to conduct further rigorous analysis of the sources of transaction records, a process called know your data (KYD).Together, KYT, KYC, and KYD can be used in several ways:To verify transactions on exchanges or broker platforms, which do not write every transaction directly to the blockchain networkTo trace transactions from services with non-blockchain-based origins (for example, with fiat currencies)To track transactions where part of the sale occurs offline, as in a face-to-face handoffTo validate data from experimental cryptocurrencies where, by design, some transactions are not automatically tracedFor the KYT approach to work, banks need to raise their internal capabilities. On the purely technological side, the required functions include connectivity and analytics; it is essential to gather and analyze a vast amount of transaction data on an ongoing basis. Then, in real time, several managerial skills are needed. These include the ability to identify illicit transactions, recognize and counter attempts to disguise transaction origins, link accounts to their sectors and countries, manage and update lists of questionable actors, build and maintain relationships with regulators in this new context, and fit the technology into an established compliance system without compromising it. As is often the case with new technologies, the greatest challenges are less a matter of digital implementation than of embedding the right attitudes and habitual behaviors throughout the bank’s workforce and in its organizational culture.

Many thanks for this unique question! Research on Federal Reserve System's Code of Conduct in regards to material nonpublic information is quite an eye opener. In essence, improper usage of nonpublic information (especially given FOMC policy information are "record or things of value" of the United States) carry severe penalties:U.S. Code on embezzlement: 18 U.S. Code § 641 - Public money, property or records, 18 U.S. Code § 655 - Theft by bank examinerInsider trading per Securities Exchange Act: 15 U.S. Code § 78j - Manipulative and deceptive devicesU.S. Code on public officials: 18 U.S. Code § 1905 - Disclosure of confidential information generallyFederal Reserve Board regulations and federal ethics regulations: 12 CFR 261.22 - Other disclosure of confidential supervisory information, 5 CFR 2635.702 - Use of public office for private gain.I would like to refer to the following responses from the Federal Reserve Board of Governors, Legal Division to minimize risk of miscommunication - please see footnote for references to the United States Code.Source: Federal Reserve Board, Legal DivisionDuring and after their employment with the Federal Reserve System, examiners and other staff are prohibited from misusing or disclosing a range of nonpublic information including confidential examination or supervision records, financial institutions’ nonpublic business information, personally identifiable information about financial institutions’ employees or customers, and nonpublic information from other regulators.For example, all current and former Board and Reserve Bank employees are subject to 18 USC 641, the criminal law that broadly prohibits any person from knowingly converting for personal use any records or things of value of the United States. Confidential supervisory information and nonpublic FOMC information or other confidential FRB data are considered to be records or things of value to the United States. In addition, 18 USC 655 is a criminal law that prohibits Federal Reserve bank examiners from unlawfully taking/stealing any confidential bank information or other property.Board employees are also subject to a host of other restrictions. For example, section 9(a) of the 2012 STOCK Act reaffirms that the Securities Exchange Act’s insider trading restrictions, 15 USC 78j(b), apply to Board employees, who are prohibited from using nonpublic information to “make a private profit.” Outside of the insider trading realm, the Trade Secrets Act, 18 USC 1905, is a criminal law that prohibits Board employees from publishing, divulging, or disclosing any confidential commercial information that they access during their Board employment. Separately, the Privacy Act of 1974 prohibits Board employees from misusing individuals’ confidential personal information. Finally, Board regulations and policies (see 12 CFR 261.22) generally forbid disclosing confidential supervisory information, and federal ethics regulations, 5 CFR 2635.702-703, prohibit Board employees from using their public office for private gain and from improperly using nonpublic information to further any private interest.In summary: profiting (or attempting to profit) from material nonpublic information (such as FOMC materials) is a serious crime, especially if it involves current and former employees of the Federal Reserve System.Please also refer to: Ex-N.Y. Fed Employee Pleads Guilty to Leaking Documents (which involved current and former Federal Reserve employees)Former Employee Of Federal Reserve Bank Of New York Pleads Guilty In Manhattan Federal Court To Theft Of Confidential Information From The Federal Reserve | USAO-SDNY | Department of JusticeReferences:18 U.S. Code § 641 - Public money, property or recordsWhoever embezzles, steals, purloins, or knowingly converts to his use or the use of another, or without authority, sells, conveys or disposes of any record, voucher, money, or thing of value of the United States or of any department or agency thereof, or any property made or being made under contract for the United States or any department or agency thereof; orWhoever receives, conceals, or retains the same with intent to convert it to his use or gain, knowing it to have been embezzled, stolen, purloined or converted—Shall be fined under this title or imprisoned not more than ten years, or both; but if the value of such property in the aggregate, combining amounts from all the counts for which the defendant is convicted in a single case, does not exceed the sum of $1,000, he shall be fined under this title or imprisoned not more than one year, or both.The word “value” means face, par, or market value, or cost price, either wholesale or retail, whichever is greater.18 U.S. Code § 655 - Theft by bank examinerWhoever, being a bank examiner or assistant examiner, steals, or unlawfully takes, or unlawfully conceals any money, note, draft, bond, or security or any other property of value in the possession of any bank or banking institution which is a member of the Federal Reserve System, which is insured by the Federal Deposit Insurance Corporation, which is a branch or agency of a foreign bank (as such terms are defined in paragraphs (1) and (3) of section 1(b) of the International Banking Act of 1978), or which is an organization operating under section 25 or section 25(a) [1] of the Federal Reserve Act, or from any safe deposit box in or adjacent to the premises of such bank, branch, agency, or organization, shall be fined under this title or imprisoned not more than five years, or both; but if the amount taken or concealed does not exceed $1,000, he shall be fined under this title or imprisoned not more than one year, or both; and shall be disqualified from holding office as a national bank examiner or Federal Deposit Insurance Corporation examiner.This section shall apply to all public examiners and assistant examiners who examine member banks of the Federal Reserve System, banks the deposits of which are insured by the Federal Deposit Insurance Corporation, branches or agencies of foreign banks (as such terms are defined in paragraphs (1) and (3) of section 1(b) of the International Banking Act of 1978), or organizations operating under section 25 or section 25(a) 1of the Federal Reserve Act, whether appointed by the Comptroller of the Currency, by the Board of Governors of the Federal Reserve System, by a Federal Reserve Agent, by a Federal Reserve bank, or by the Federal Deposit Insurance Corporation, or appointed or elected under the laws of any State; but shall not apply to private examiners or assistant examiners employed only by a clearing-house association or by the directors of a bank.15 U.S. Code § 78j - Manipulative and deceptive devicesIt shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate commerce or of the mails, or of any facility of any national securities exchange—(a)(1) To effect a short sale, or to use or employ any stop-loss order in connection with the purchase or sale, of any security other than a government security, in contravention of such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors.(2) Paragraph (1) of this subsection shall not apply to security futures products.(b) To use or employ, in connection with the purchase or sale of any security registered on a national securities exchange or any security not so registered, or any securities-based swap agreement [1] any manipulative or deceptive device or contrivance in contravention of such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors.(c)(1) To effect, accept, or facilitate a transaction involving the loan or borrowing of securities in contravention of such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors.(2) Nothing in paragraph (1) may be construed to limit the authority of the appropriate Federal banking agency (as defined in section 1813(q) of title 12), the National Credit Union Administration, or any other Federal department or agency having a responsibility under Federal law to prescribe rules or regulations restricting transactions involving the loan or borrowing of securities in order to protect the safety and soundness of a financial institution or to protect the financial system from systemic risk.Rules promulgated under subsection (b) that prohibit fraud, manipulation, or insider trading (but not rules imposing or specifying reporting or recordkeeping requirements, procedures, or standards as prophylactic measures against fraud, manipulation, or insider trading), and judicial precedents decided under subsection (b) and rules promulgated thereunder that prohibit fraud, manipulation, or insider trading, shall apply to security-based swap agreements to the same extent as they apply to securities. Judicial precedents decided under section 77q(a) of this title and sections 78i, 78o, 78p, 78t, and 78u–1 of this title, and judicial precedents decided under applicable rules promulgated under such sections, shall apply to security-based swap agreements to the same extent as they apply to securities.18 U.S. Code § 1905 - Disclosure of confidential information generallyWhoever, being an officer or employee of the United States or of any department or agency thereof, any person acting on behalf of the Federal Housing Finance Agency, or agent of the Department of Justice as defined in the Antitrust Civil Process Act (15 U.S.C. 1311–1314), or being an employee of a private sector organization who is or was assigned to an agency under chapter 37 of title 5, publishes, divulges, discloses, or makes known in any manner or to any extent not authorized by law any information coming to him in the course of his employment or official duties or by reason of any examination or investigation made by, or return, report or record made to or filed with, such department or agency or officer or employee thereof, which information concerns or relates to the trade secrets, processes, operations, style of work, or apparatus, or to the identity, confidential statistical data, amount or source of any income, profits, losses, or expenditures of any person, firm, partnership, corporation, or association; or permits any income return or copy thereof or any book containing any abstract or particulars thereof to be seen or examined by any person except as provided by law; shall be fined under this title, or imprisoned not more than one year, or both; and shall be removed from office or employment.12 CFR 261.22 - Other disclosure of confidential supervisory information.§ 261.22 Other disclosure of confidential supervisory information.(a) Board policy. It is the Board's policy regarding confidential supervisory information that such information is confidential and privileged. Accordingly, the Board will not normally disclose this information to the public. The Board, when considering a request for disclosure of confidential supervisory information under this section, will not authorize disclosure unless the person requesting disclosure is able to show a substantial need for such information that outweighs the need to maintain confidentiality.(b) Requests for disclosure—(1) Requests from litigants for information or testimony. Any person (except agencies identified in §§ 261.20 and 261.21 of this regulation) seeking access to confidential supervisory information or seeking to obtain the testimony of present or former Board or Reserve Bank employees on matters involving confidential supervisory information of the Board, whether by deposition or otherwise, for use in litigation before a court, board, commission, or agency, shall file a written request with the General Counsel of the Board. The request shall describe:(i) The particular information, kinds of information, and where possible, the particular documents to which access is sought;(ii) The judicial or administrative action for which the confidential supervisory information is sought;(iii) The relationship of the confidential supervisory information to the issues or matters raised by the judicial or administrative action;(iv) The requesting person's need for the information;(v) The reason why the requesting person cannot obtain the information sought from any other source; and(vi) A commitment to obtain a protective order acceptable to the Board from the judicial or administrative tribunal hearing the action preserving the confidentiality of any information that is provided.(2) All other requests. Any other person (except agencies identified in §§ 261.20 and 261.21 of this regulation) seeking access to confidential supervisory information for any other purpose shall file a written request with the General Counsel of the Board. A request under this paragraph (b)(2) shall describe the purpose for which such disclosure is sought.(c) Action on request—(1) Determination of approval. The General Counsel of the Board may approve a request made under this section provided that he or she determines that:(i) The person making the request has shown a substantial need for confidential supervisory information that outweighs the need to maintain confidentiality; and(ii) Disclosure is consistent with the supervisory and regulatory responsibilities and policies of the Board.(2) Conditions or limitations. The General Counsel of the Board may, in approving a request, impose such conditions or limitations on use of any information disclosed as is deemed necessary to protect the confidentiality of the Board's information.(d) Exhaustion of administrative remedies for discovery purposes in civil, criminal, or administrative action. Action on a request under this section by the General Counsel of the Board shall exhaust administrative remedies for discovery purposes in any civil, criminal, or administrative proceeding. A request made pursuant to § 261.12 of this regulation does not exhaust administrative remedies for discovery purposes. Therefore, it is not necessary to file a request pursuant to § 261.12 to exhaust administrative remedies under this section.(e) Other disclosure prohibited. All confidential supervisory information made available under this section shall remain the property of the Board. Any person in possession of such information shall not use or disclose such information for any purpose other than that authorized by the General Counsel of the Board without his or her prior written approval.5 CFR 2635.702 - Use of public office for private gain.§ 2635.702 Use of public office for private gain.An employee shall not use his public office for his own private gain, for the endorsement of any product, service or enterprise, or for the private gain of friends, relatives, or persons with whom the employee is affiliated in a nongovernmental capacity, including nonprofit organizations of which the employee is an officer or member, and persons with whom the employee has or seeks employment or business relations. The specific prohibitions set forth in paragraphs (a) through (d) of this section apply this general standard, but are not intended to be exclusive or to limit the application of this section.(a) Inducement or coercion of benefits. An employee shall not use or permit the use of his Government position or title or any authority associated with his public office in a manner that is intended to coerce or induce another person, including a subordinate, to provide any benefit, financial or otherwise, to himself or to friends, relatives, or persons with whom the employee is affiliated in a nongovernmental capacity.Example 1:Offering to pursue a relative's consumer complaint over a household appliance, an employee of the Securities and Exchange Commission called the general counsel of the manufacturer and, in the course of discussing the problem, stated that he worked at the SEC and was responsible for reviewing the company's filings. The employee violated the prohibition against use of public office for private gain by invoking his official authority in an attempt to influence action to benefit his relative.Example 2:An employee of the Department of Commerce was asked by a friend to determine why his firm's export license had not yet been granted by another office within the Department of Commerce. At a department-level staff meeting, the employee raised as a matter for official inquiry the delay in approval of the particular license and asked that the particular license be expedited. The official used her public office in an attempt to benefit her friend and, in acting as her friend's agent for the purpose of pursuing the export license with the Department of Commerce, may also have violated 18 U.S.C. 205.(b) Appearance of governmental sanction. Except as otherwise provided in this part, an employee shall not use or permit the use of his Government position or title or any authority associated with his public office in a manner that could reasonably be construed to imply that his agency or the Government sanctions or endorses his personal activities or those of another. When teaching, speaking, or writing in a personal capacity, he may refer to his official title or position only as permitted by § 2635.807(b). He may sign a letter of recommendation using his official title only in response to a request for an employment recommendation or character reference based upon personal knowledge of the ability or character of an individual with whom he has dealt in the course of Federal employment or whom he is recommending for Federal employment.Example 1:An employee of the Department of the Treasury who is asked to provide a letter of recommendation for a former subordinate on his staff may provide the recommendation using official stationery and may sign the letter using his official title. If, however, the request is for the recommendation of a personal friend with whom he has not dealt in the Government, the employee should not use official stationery or sign the letter of recommendation using his official title, unless the recommendation is for Federal employment. In writing the letter of recommendation for his personal friend, it may be appropriate for the employee to refer to his official position in the body of the letter.(c) Endorsements. An employee shall not use or permit the use of his Government position or title or any authority associated with his public office to endorse any product, service or enterprise except:(1) In furtherance of statutory authority to promote products, services or enterprises; or(2) As a result of documentation of compliance with agency requirements or standards or as the result of recognition for achievement given under an agency program of recognition for accomplishment in support of the agency's mission.Example 1:A Commissioner of the Consumer Product Safety Commission may not appear in a television commercial in which she endorses an electrical appliance produced by her former employer, stating that it has been found by the CPSC to be safe for residential use.Example 2:A Foreign Commercial Service officer from the Department of Commerce is asked by a United States telecommunications company to meet with representatives of the Government of Spain, which is in the process of procuring telecommunications services and equipment. The company is bidding against five European companies and the statutory mission of the Department of Commerce includes assisting the export activities of U.S. companies. As part of his official duties, the Foreign Commercial Service officer may meet with Spanish officials and explain the advantages of procurement from the United States company.Example 3:The Administrator of the Environmental Protection Agency may sign a letter to an oil company indicating that its refining operations are in compliance with Federal air quality standards even though he knows that the company has routinely displayed letters of this type in television commercials portraying it as a “trustee of the environment for future generations.”Example 4:An Assistant Attorney General may not use his official title or refer to his Government position in a book jacket endorsement of a novel about organized crime written by an author whose work he admires. Nor may he do so in a book review published in a newspaper.(d) Performance of official duties affecting a private interest. To ensure that the performance of his official duties does not give rise to an appearance of use of public office for private gain or of giving preferential treatment, an employee whose duties would affect the financial interests of a friend, relative or person with whom he is affiliated in a nongovernmental capacity shall comply with any applicable requirements of § 2635.502.(e) Use of terms of address and ranks. Nothing in this section prohibits an employee who is ordinarily addressed using a general term of address, such as “The Honorable”, or a rank, such as a military or ambassadorial rank, from using that term of address or rank in connection with a personal activity.

Legally required:Pay your taxesIncome tax: Understand the tax effects of allocation of purchase price, plus ordinary income, capital gains, tax free reorganizations, etc.Bulk sale doctrineAcquire the legal right to sell your business: (a) provide proof of ownership, (b) obtain valid consent from shareholders/partners/LLC members in company resolutions, documents or agreements.Obtain third party approval (e.g., landlord, clients, vendors, etc.)Advise government, officials or agencies (if necessary)Here’s what is not legally required, but very smart and common to implement:Advise your insurance agent, accountant, lawyer, banker, professionalsNegotiate the terms of purchase in the form of a letter of intent or term sheet.Due DiligenceDocument the TransactionClose the F*ing Deal (and most importantly, get paid)Let’s review from the perspective of the seller (“you”):Negotiate Terms of PurchaseYou should prepare your business for sale and get an idea of the fair market valuation of the company, what the terms of sale will look like, and how you want to go about selling the company. You can list it with a broker or use some other form of advertisement to communicate to potential buyers that it is for sale. Interested buyers and brokers will want to discuss a variety of terms that will eventually be a part of any sales transaction. Here are some of the terms you will have to consider:Purchase price. You can anticipate that potential buyers will want to negotiate a lower price from the price at which you advertise your business. Keep in mind that negotiated items can affect the purchase price, so if you have a hold-back account or earn out, this can lower the purchase price. The asking price should be flexible enough to accommodate a healthy negotiation process. Having an independent business appraisal will give credibility to and context to your asking price.Terms of financing and interest. The purchase price can be paid in a lump sum cash payment or it can be stretched out over time. Often small business owners have to finance a portion of the purchase price. Financing the purchase price typically requires a promissory note along with some form of security agreement with collateral pledged against the future payment of the note. The state you are in may regulate the amount of interest you can charge.Representations and warranties. Both the buyer and the seller will want to make certain representations and warranties to each other. A representation is a true and accurate statement of facts and a warranty is a promise that the facts as presented are true. For example, the seller will represent and warrant that he or she is the legal owner of the business and is authorized to sell it. The buyer will represent and warrant that he or she is authorized to enter into the transaction and that the agreement is enforceable. Sometimes sellers or buyers will try to represent and warrant future promises or facts, but those are not representations or warranties. Those are called “covenants” or promises.Lease. If you have a lease on office space, your buyer will probably want to take over the lease. This can be done through a sub-lease arrangement or by negotiating a new lease with the landlord.Negotiate LOI or Term Sheet. After you have gone through the process of negotiating the basic terms of selling your business, the seller and the buyer will sign a document that briefly outlines those terms. This is called a “letter of intent.” It is usually a non-binding binding contract but not always. For example, you could ask for a Good Faith Deposit (an enforceable covenant) or a confidentiality clause. This helps to keep track of what has already been negotiated. This document makes it easier to produce the final purchase agreement.NDA/Confidentiality. Unless and until a final definitive agreement is signed, there is nothing to prevent the potential buyer from raiding your company secrets. To prevent a potential competitor from stealing your trade secrets, it’s important that you take reasonable steps to keep your secrets protected: By either having them sign an non-disclosure agreement (“NDA”) or confidentiality agreement or giving them only the general nature of your trade secrets or confidential information. However, finances will usually need to be disclosed so you should almost always get an NDA signed that will protect your disclosures.Due DiligenceOnce you have a bona fide buyer who has signed a confidentiality agreement and a letter of intent (or term sheet), they will want some time to inspect your business to make sure everything you have represented checks out. This is called the due diligence period and it gives the buyer the opportunity to inspect the physical and economic state of your business including the building, equipment, inventory, and employees, as well as the financial records, agreements, and company books. In order to ensure a smooth transition for the new buyer, you want to make sure that you disclose everything up front. The following is a list of items you should be prepared to make available to a serious buyer:Company books which include corporate records of organization, meeting minutes, company resolutions, ownership certificates, certificates of good standing, and records of company structureFinancial records and tax returns including profit and loss statements, and balances sheetsMaterial contracts with vendors, suppliers, clients, customers, distributors or any other ongoing business relationship that is a critical part of your businessAccounts receivable reports that detail the future payments the company expects to receive from transactions that have closed prior to the sale of the businessValuation report prepared by a CPA or business appraiser that justifies your offer for the business and gives context to the buyer for understanding how the price was determined.In addition to inspecting records and physical facilities of your business, a prudent buyer will want to contact business partners who have experience doing business with you. This might include speaking with vendors, customers, distributors, or other business partners to assess the strength of the various business relationships. If there are skeletons in the closet of your business it is a good idea to deal with them in a straightforward and honest manner. The more information the buyer has about potential problems the better equipped they will be to handle those problems after you close the transaction.Document the TransactionThe sale agreement is usually called a “Purchase Agreement” or “Purchase and Sale Agreement.” This is the primary legal document used for the acquisition of a business. The purchase agreement outlines all of the details of the sale and mirrors the letter of intent or term sheet. Depending on how you structure this transaction you may also need a bill of sale, promissory note, security agreement, stock transfer certificate, and company resolutions. The purchase agreement should include all of the following:the parties (who is the buyer/seller and the business)whether this is a sale of business assets or an entity salethe purchase price and method of paymentearn out, seller financing or lump sum saleactions that the buyer and seller must take prior to closingthe closing daterepresentations and warranties of the buyerrepresentations and warranties of the sellerindemnificationcovenants (e.g., non-compete and confidentiality)default provisions for sales involving seller financingboilerplate legal provisionsexhibits of other relevant documents such as bill of sale and promissory note.Close the F*ing DealOften times sellers are in a rush to get the sale through and buyers want to take their time. As a seller, you should be diligent but firm. Keep a realistic closing date in mind but at the same time DON’T DELAY. Any delay could result in the buyer walking away. A new competitor enters the market? Your building blows up? Have a bad quarter and need to release those results to the buyer? Something weird happens to the business at the 11th hour? This happens ALL THE TIME!! So, without trying to instill a level of too much panic and adrenaline into your system, you should proceed diligently as time is of the essence. The only time you should relax is when the deal is inked (or docusigned), the check clears and you are past any point in time when a rep or warranty could come back to haunt you. That’s when you celebrate.