The M&A Source Model Code of Professional Responsibility

The M&A Source Model Code of Professional Responsibility is a set of professional standards designed to establish the minimum baseline of professional responsibility generally required of M&A Advisors who are members of the M&A Source. This Code is offered as a guideline to all M&A Advisors regardless of membership status.

While the Code establishes an aspirational set of principles that may be higher or different than those mandated by law, in any instances where the Code and the law conflict, the obligations of the law must take precedence.

PREAMBLE

M&A Advisors and the M&A Source Members must strive to support entrepreneurship and the concept that the investment risks of owning a business deserve a straightforward, professional and honest presentation to both seller and buyer.

M&A Advisors and specifically Members of the M&A Source must strive to be zealous in maintaining and improving ethical practices and sharing with their fellow M&A Advisors and Members a common responsibility for integrity and honor in their business transactions.

In recognition and appreciation of their obligations to clients, customers, the public, and each other, M&A Advisors must continuously strive to become and remain informed on issues affecting the sale and purchase of businesses and be willing to share their experience with others. M&A Advisors and Members must strive to eliminate practices that may damage the public, clients, customers, industry/profession, or which might discredit or bring dishonor to the M&A Advisor profession.

M&A Advisors must strive to urge sole and exclusive representation of clients, not attempt to gain an unfair advantage over competitors, and refrain from making unsolicited comments about other practitioners.

M&A Advisors must strive to observe the spirit of this Code in all activities and to conduct their business in accordance with the tenets set forth below:

ARTICLE 1

M&A Advisors must endeavor to comply with all laws within jurisdictions in which they practice.

ARTICLE 2

M&A Advisors should keep himself/herself informed of the trends, best practices and changes affecting M&A Advisor services.

ARTICLE 3

M&A Advisors must avoid exaggeration, misrepresentation, or concealment of pertinent facts relating to properties and business transactions; however, nothing herein must be construed to obligate M&A Advisors to discover latent defects, or advise on matters outside the scope of their expertise, or disclose facts that are confidential under the scope of agency duties owed to their clients.

ARTICLE 4

M&A Advisors must make a reasonable effort in a transaction to protect the public and all parties against fraud, misrepresentation(s), or unethical practice(s) in the area of business transactions. M&A Advisors must not make false, misleading or exaggerated claims about themselves, their firms, franchisors (where applicable) or their competition.

ARTICLE 5

M&A Advisors must encourage customers and clients to seek the services of qualified attorneys, accountants, or other professional advisors when applicable. Unless appropriately licensed, M&A Advisors must not undertake to provide professional services without required licensure including, but not limited to legal, accounting, tax, financial planning, and/or real-estate where doing so would be a violation of law in the jurisdiction in which the intermediary(s) practice(s).

ARTICLE 6

M&A Advisors must keep in a separate bank account, apart from their own funds, monies coming into their possessions in trust for other persons. Where such holding of trust or escrow funds is governed by law, or regulations under explicit licensures, M&A Advisors must adhere to said laws or regulations.

ARTICLE 7

M&A Advisors must obtain terms and conditions of agreements in writing regarding business listings, agency relationships, or business transactions, and ensure that copies of such agreements are given to all parties involved and where applicable, in accordance with the respective laws, rules, regulations, and jurisdiction.

ARTICLE 8

M&A Advisors, in accepting employment as agents, must endeavor to protect and promote the interests of their clients. This obligation of absolute loyalty and honesty to the client’s interest is primary, but it does not relieve M&A Advisors from the obligation of dealing honestly and fairly with all parties and/or in accordance with higher fiduciary duties as required within a relative, and/or applicable jurisdiction.

ARTICLE 9

M&A Advisors accepting compensation from more than one party, where such is allowed by law, must make written disclosure to the principals of the transaction and/or in accordance with applicable laws, rules and/or regulations within a relative, and/or applicable jurisdiction.

ARTICLE 10

M&A Advisors must disclose, and receive consent to, and by, all parties of a dual agency relationship, or a limited dual agency relationship or a designated agency relationship, in writing and or as required by the law of agency within the relative, and/or applicable jurisdiction.

ARTICLE 11

M&A Advisors having a present or contemplated personal or non-arm’s length interest concerning a business or a property, or their respective value, must disclose in writing such interest to the principals of the transaction.

ARTICLE 12

M&A Advisors, acting as an agent, accepting any commission, rebate, fees, or profit due to expenditures made on behalf of the principal must disclose in writing and obtain consent in writing from the principal.

ARTICLE 13

M&A Advisors undertaking to provide specialized services concerning a type of business or property or a service outside their field of competence must disclose such deficiency or facts, and/or as appropriate engage the assistance of one who is competent in such types of business or property or service. Any persons engaged to provide such assistance must be so identified to the client or customer and their contribution to the assignment must be set forth.

ARTICLE 14

M&A Advisors must only advertise businesses as being for sale when they have written authority to do so. All offerings or promotions of businesses for sale must reflect the terms consistent with those of a written agreement with the client or customer.

ARTICLE 15

M&A Advisors must submit all offers, written or verbal, to the client unless otherwise directed by the client, or as required bylaws, rules or regulations of the relative, and/or applicable jurisdiction.

ARTICLE 16

M&A Advisors must not disclose the terms of one buyer’s offer to any other buyer.

ARTICLE 17

M&A Advisors must adhere to the anti-discrimination laws in force in the jurisdiction(s) in which they practice.

ARTICLE 18

M&A Advisors must refrain from continued and prolonged association with individuals or organizations which act in a manner contrary to this Code.