Finders Fee Agreement Sample

FINDERS FEE AGREEMENT This Finders Fee Agreement ("Agreement") is made and entered into as of the date set forth below, between ________________________________ ("Representative") and _______________________ ("Client") (Sometime collectively referred to as the “Parties”). RECITALS A. Representative has strategic relationships which could assist Client including the location of equity, debt, and/or project financing. B. Client seeks introduction to Representative’s strategic relationship to obtain equity, debt, and/or project financing. C. Client desires to engage Representative to arrange business opportunities, buyer relations contacts, and/or financing for Client and/or entities beneficially controlled by Client or its principals, including but not limited to sales, marketing, joint ventures, service contracts, equity, debt and/or project finance (“Strategic Relationships”) with other business entities (“Prospect(s)”). NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained the Parties hereto agree as follows: 1. EFFECTIVE DATE OF AGREEMENT. 1.1 This Agreement will become effective on July 15, 2009 and will continue in effect unless terminated in accordance with the provisions of Paragraph 4 of this Agreement. 2. INDEPENDENT CONTRACTOR STATUS. 2.1. This Agreement shall not be construed to create a partnership, joint venture, employment, or agency relationship between the Parties. Neither Party shall be liable for any of the debts or obligations of the other Party, and neither Party shall have the right to bind, make any representations or warranties, accept service of process, or perform any act for or on behalf of the other Party, except as otherwise expressly provided herein. Each Party acknowledges that it is an independent entity and is not subject to the control of the other Party except as otherwise expressly provided herein. 3. TERMS OF ENGAGEMENT. 3.1. Client hereby engages Representative for purposes of providing advisory and representation services with respect to Client”s products, services, and/or finance requirements through the exploration of strategic alternatives that may lead to a possible transaction (a "Transaction"), through (i) a minority investment in the Client via a direct or indirect contract, FINDERS FEE AGREEMENT

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debt and/or equity funding arrangement, a direct or indirect loan; (ii) a sale, merger, joint venture, strategic business alignment, partnership or and/or any other creative business combination, whether effected in a single transaction or a series of related transactions, in which 50% or more of the voting power of the Client or all or a substantial portion of its business or assets are combined with or transferred to another company; and (iii) any lease, guarantee, swap and/or any other creative business transaction. 4. TERM AND TERMINATION. 4.1 Except as provided in Sections and 4.2 thru 4.3. of this agreement, the term of this Agreement shall commence on the date set forth above and shall continue indefinitely on a dayto-day basis until canceled by a minimum of sixty (60) days prior written notice from either Party to the other. The entire time period that this Agreement is in effect, as stated above, shall be referred to as the "Term". 4.2. This Agreement may be earlier terminated by either Party upon the occurrence of any of the following events: a.

The other Party is adjudged a bankrupt or becomes insolvent; b.

All or substantially all of the assets of the other Party are sold transferred or liquidated; and

b. The other Party enters into an assignment or other arrangement for the benefit of its creditors. d.

The other Party defaults in the performance of any material duty under this Agreement or materially breaches any of its provisions;

e. The other Party engages in conduct which is injurious to the terminating party or its business reputation; and f. The other Party fails to satisfactorily perform all of its duties for which it is responsible. 4.3. The Party electing to terminate this Agreement pursuant to paragraph 4.2 shall give written notice to the other Party. The termination shall be effective upon thirty (30) days written notice unless the reason for termination is cured within said thirty (30) day period. Notwithstanding the forgoing, the termination shall be effective immediately, at the terminating Parties option, if: a.

The breach is not susceptible to cure; or

b. Failure to terminate immediately will cause a significant, negative impact on the terminating Party FINDERS FEE AGREEMENT

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5. COMPENSATION 5.1. In the event Client, or an entity in which Client represents and/or its principals are beneficial owners and/or controlling parties, enters into a Transaction or receives a commitment toward a Transaction, either (i) during the Term with any Prospect(s) identified and/or submitted by Representative, or (ii) within thirty six (36) months after termination of Agreement with any Prospect(s) who had any communication during the Term with the Representative regarding Client, Client agrees to pay to compensate Representative as set out in Exhibit A attached hereto. 5.2. Fees involving monetary disbursement (as in the case of product or service sales or securement of funding) shall be paid in full to Representative at the time of the initial payment received on the contract, once funds are available from the Client’s bank account. If an escrow is opened for the transfer of the funds to Client, Client shall add an escrow instruction, instructing escrow to pay to Representative directly, 10% of the proceeds from the Escrow. After fifteen (15) days interest will accrue from the due date on unpaid amounts at one percent (1.8%) per month. Fees involving company share/ownership participation (as in the case of strategic partnerships, joint ventures, and/or other teaming arrangements) shall be delivered to Representative immediately upon consummation of the Strategic Relationship between Client and Prospect(s). 5.3. During the term of the Agreement, and for a period of thirty six (36) months thereafter following its termination as provided in Section 4, the Client shall not enter into a business relationship with any Prospect(s), person or other entity introduced to Client by Representative (except those entities with which the Client had a documented business relationship prior to this Agreement) except in a manner consistent with, and pursuant to, this Agreement. 5.4. Client shall notify Representative in advance of any closing of contract so that Representative may attend such closing. Representative shall have reasonable access to all closing documents and any other materials necessary to ascertain and collect its fee hereunder. 5.5. Client shall reimburse Representative for its travel related expenses associated with the work anticipated in this Agreement on the basis of periodic bills to be submitted to the Client by Representative. All such travel expenses incurred by Representative shall be preapproved by the Client. 6. CONFIDENTIALITY. 6.1. To facilitate the release of information between Representative and Client, this Agreement sets forth the conditions and obligations, in total, which will control information, duplication, conversation about and disclosure of any and all Confidential information relating to, in general terms, customers, products and services of the Parties. 6.2 Definitions. For purposes of this Agreement, the following terms shall have the following meanings. FINDERS FEE AGREEMENT

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a. "Confidential Information" shall mean any information, whether written or verbal, which has been, or after the date hereof will be, furnished or disclosed by either Client or Representative, or their employees, consultants or agents, including any information pertaining to or regarding the business, financial condition, sales planning and strategies, business planning and strategies, general plans, clients, customers, members, suppliers, properties and operations of the Representative or Client, and including without limiting the generality of the foregoing, all technical information of any nature whatsoever and all techniques, marketing plans, financing plans, financial plans, time lines for implementation, inventions, trade secrets, know-how, discoveries, software (computer program), processes, drawings, designs, research, plans or specifications relating thereto. b. "Client" shall include, individually and collectively, the entity identified above as Client as well as officers, directors, associates, members, contractors and employees of Client. c. "Representative" shall include, individually and collectively, the entity identified above as Representative as well as officers, directors, associates, members, contractors and employees of Representative. d.

“Party or Parties” shall include the Parties to this agreement.

e. "Related Parties" shall mean either the Client or Representative and their directors, officers, employees, agents or representatives, including without limitation attorneys, financial advisors, analysts and accountants, and any or all of the, to the extent such entities or persons receive Confidential Information. 6.3. The Parties shall keep in strictest confidence and trust, all Confidential Information and shall not disclose any Confidential Information to any other entity or person, or use any Confidential Information for its own benefit or for the benefit of another, except for the limited purpose of evaluating a possible business relationship with the Representative and Client, without the express written consent of the either Party. 6.4. Neither Representative nor Client shall not be held liable for disclosure if it can be established by the preponderance of the evidence that the information (1) became part of the public knowledge without any breach of this Agreement, except where such knowledge or availability is the result of an unauthorized disclosure by the Representative, Client or a Related Party, (2) became known to Representative or Client from a third party who has lawful right to disclose information without breach of the Agreement. 6.5. Should a Party be faced with judicial action to disclose any information pertaining to the other, Representative or Client must legally resist disclosing such information and notify the other in writing via certified United States Postal Service, a minimum of 21 calendar days prior to any disclosure or planned disclosure.

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6.6. Nothing in this Agreement is intended to or shall grant to a Party or any Related Party any license or other right of any nature to the use of any of the Confidential Information. All information disclosed to either Representative or Client will remain the exclusive property of the Party disclosing the information. 6.7. All confidential information shall remain the exclusive property of the Party originating the information. The Party and all Related Parties shall return, all copies, transcriptions or other reproductions of, and any notes relating to, the Confidential Information of the Party originating the information upon (1) the accomplishment of the purpose for which the Confidential Information was provided, (2) receipt of a written notice form the Party requesting return of the Confidential Information or (3) termination of this Agreement. 7. WARRANTIES AND REPRESENTATIONS. 7.1. Representative warrants and represents that (a) it has full authority and ability to make and perform this Agreement in accordance with its terms; (b) the making or performance of this Agreement by Representative will not violate any rights of, agreements with, or obligations to any third parties; (c) Representative will comply with all applicable securities or other laws, rules and regulations relating to the Agreement; and (d) Representative will not circumvent or otherwise frustrate the intent of this Agreement. 7.2. Client warrants and represents that (a) it has full authority and ability to make and perform this Agreement in accordance with its terms; (b) the making or performance of this Agreement by Client will not violate any rights of, agreements with or obligations to any third parties; (c) Client will comply with all applicable securities or other laws, rules and regulations relating to the Agreement, and (d) Client will not circumvent or otherwise frustrate the intent of this Agreement. 8. NEGLIGENCE, INDEMNITY AND CONTRIBUTION. 8.1. Representative nor any of its affiliates (nor any of their respective control persons, directors, officers, employees or agents) shall be liable to the Client or to any other person claiming through the Client for any claim, loss, damage, liability, cost or expense suffered by the Client or any such other person arising out of or related to Representative= s engagement hereunder except for a claim, loss or expense that arises primarily out of or is based primarily upon any action or failure to act by Representative, other than an action or failure to act undertaken at the request or with the consent of the Client, that is found in a final judicial determination (or a settlement tantamount thereto) to constitute bad faith, willful misconduct or gross negligence on the part of Representative. 8.2. Indemnity and Contribution. The Client agrees to indemnify and hold harmless Representative and its affiliates (and their respective control persons, directors, officers, employees and agents) to the full extent lawful against any and all claims, losses, damages, liabilities, costs and expenses as incurred (including all reasonable fees and disbursements of FINDERS FEE AGREEMENT

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counsel and all reasonable travel and other out-of-pocket expenses incurred in connection with investigation of, preparation for and defense of any pending or threatened claim and any litigation or other proceeding arising there from, whether or not in connection with pending or threatened litigation in which Representative or any other indemnified person is a party) arising out of or related to any actual or proposed Transaction or Representative=s engagement hereunder; provided, however, there shall be excluded from such indemnification any such claims, losses, damages, liabilities, costs or expenses that arise primarily out of or are based primarily upon any action or failure to act by Representative, other than an action or failure to act undertaken at the request or with the consent of the Client, that is found in a final judicial determination (or a settlement tantamount thereto) to constitute bad faith, willful misconduct or gross negligence on the part of Representative. In the event that the foregoing indemnity is unavailable or insufficient to hold Representative and other indemnified parties harmless, then the Client shall contribute to amounts paid or payable by Representative and other indemnified parties in respect of such claims, losses, damages, liabilities, costs and expenses in such proportion as appropriately reflects the relative benefits received by, and, if applicable law does not permit allocation solely on the basis of benefits, fault of, the Client and Representative in connection with the matters as to which such claims, losses, damages, liabilities, costs and expenses relate and other equitable considerations, subject to the limitation that in any event Representative=s aggregate contributions in respect of such claims, losses, damages, liabilities, costs and expenses will not exceed the amount of fees and expenses actually received by Representative pursuant to this Agreement. For purposes hereof, relative benefits to the Client and Representative of the Transaction shall be deemed to be in the same proportion that the total value received or contemplated to be received by the Client and/or its security holders in connection with the Transaction bears to the fees paid to Representative pursuant to its engagement in respect of such Transaction. The Client will not, without the prior written consent of Representative, settle any litigation relating to Representative=s engagement hereunder unless such settlement includes an express, complete and unconditional release of Representative and its affiliates (and their respective control persons, directors, officers, employees and agents) with respect to all claims asserted in such litigation or relating to Representative=s engagement hereunder; such release to be set forth in an instrument signed by all parties to such settlement. 9. GENERAL PROVISIONS. 9.1. If any Party shall commence any action or proceeding against another in order to enforce the provisions of this Agreement, or to cover damages as the result of the alleged breach of any of the provisions of this Agreement, the prevailing Party therein shall be entitled to recover all reasonable costs incurred in connection therewith against the Party commencing such action or the Party who had breach this Agreement, as the cause may be, including reasonable attorneys' fees including those incurred prior to filing an action related to such proceeding. 9.2. This Agreement shall be governed by and construed in accordance with the laws of the State of California and any action brought relating to this Agreement shall be commenced in the Superior Court of the County of Orange, State of California. 9.3.

All understandings and agreements heretofore had between Representative and FINDERS FEE AGREEMENT

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Client, whether in writing or oral, are merged into this agreement, which alone (together with the schedules and exhibits attached hereto or referenced herein) fully and completely expresses the Parties= agreement with regard to the subject matter of this Agreement and neither Party is relying upon any statements or representation not set forth herein. Only a writing dated on or after the date of this Agreement, signed by each of the Parties hereto may amend this Agreement. The Recitals are incorporated into this Agreement by this reference. 9.4. If any provision of this Agreement is declared by any court of competent jurisdiction to be invalid for any reason, such invalidity shall not affect the remaining provisions. On the contrary, such remaining provisions shall be fully severable, and this Agreement shall be construed and enforced as if such invalid provisions never had been inserted in this Agreement. 9.5. This Agreement, including any exhibits, schedules and amendments have been negotiated at arm’s length between persons sophisticated and knowledgeable in the matters dealt with in this Agreement. Each Party ha been represented by experienced and knowledgeable legal counsel. Accordingly, any rule of law or legal decision that would require interpretation of any ambiguities in this Agreement against the Party that has drafted it is not applicable and is waived. The provisions of this Agreement shall be interpreted in a reasonable manner to effectuate the purposes of the Parties to this Agreement. 9.6. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original Agreement, and will become effective and binding upon the Parties at such time as all of the signatories hereto have signed the counterpart of this Agreement. All counterparts so executed shall constitute on agreement binding on all of the Parties hereto, notwithstanding that all of the Parties are not a signatory to the same counterpart. It shall only be necessary to produce one of such counter part in making proof of this Agreement. It is further agreed that a facsimile signature shall be deemed an original. 9.7. Any and all notices, requests, approval or other communications required or given under this Agreement shall be deemed delivered when actual delivery or notice is effected on the Party being given notice. Actual and personal notice is deemed to have been given and effective as follows: a.

If by personal delivery, the day of personal delivery;

b.

If by facsimile, the day the facsimile is sent;

c.

If by mail deposited in a United States post office with postage prepaid and addressed to the Parties as set forth below three (3) business days;

d.

If by mail deposited in a post office out side of the United States with postage prepaid and addressed to the Parties as set forth below ten (10) days.

e.

Business days shall not include legal holidays or a Saturday, a Sunday or FINDERS FEE AGREEMENT

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days on which banking institutions are not required to be opened. Rick L. Raynsford 28462 Shrike Lane Laguna Niguel, CA 92677 _______________________ _______________________ _______________________ 9.8. No waiver by any Party of any of its rights under this Agreement or applicable law shall be effective unless made in witting and signed by such Party. No such waiver shall constitute or be interpreted as a waiver with respect to any future even or any other rights of such Party. 9.9. No Party hereto shall be liable for failure to perform, in whole or in material part, its obligations under this Agreement if such failure is caused by any event or condition not existing as of the date of this Agreement (unless reasonably foreseeable by such Party) and not reasonably within the control of the affected Party, including without limitations, by fire, flood, typhoon, earthquake, explosion, strikes, labor troubles or other industrial disturbances, inability to obtain ingredients, unavoidable accidents, war, (declared or undeclared), acts of terrorism, sabotage, embargoes, blockage, acts of any governmental entities, riots, insurrections or any other cause beyond the control of the Parties; provided, only, that the affected Party promptly notifies the other Party of the occurrence of the event of force majeure and takes all reasonable steps necessary to resume performance of is obligations so interfered with. 9.10. This agreement together with its right and obligations shall not be assigned either voluntarily or involuntarily with out the consent of the other Party. 9.11. Representative and Client each agree to indemnify fully and forever each other and their affiliates and subsidiaries from any and all losses, claims, damages, liabilities, costs and expenses arising from or relating to its breach of this Agreement, including, but not limited to, all reasonable arbitration, attorney, collection and/or court costs. IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed as of the date set forth above. _____________________________________

__________________________________ Client

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SCHEDULE A 1. Cash/Aggregate Consideration. As a fee for Representatives services Client shall pay to Representative the following: 10% of consideration received by Client.

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