casemark/finders-fee-agreement

Finder's Fee Agreement

Draft a contract that compensates an introducer for sourcing opportunities while constraining scope to avoid broker-dealer registration, agency, or fiduciary status.

Prerequisites

1. Parties — legal names, entity types, jurisdictions, addresses, signatories, authority.
2. Opportunity scope — target type, industry, geography, deal size, exclusions.
3. Compensation model — percentage, flat, tiers, caps, earnouts, payment timing.
4. Regulatory posture — securities vs non-securities, licensing status, any exemptions.
5. Exclusivity + term — exclusive or not, term length, termination rights, tail period.
6. Confidentiality — NDA terms, permitted use, disclosure triggers.
7. Dispute framework — governing law, venue/arbitration, fees.

Output Structure / Process

1) Definitions

| Term | Definition | |---|---| | Client | Entity receiving introductions | | Finder | Independent contractor providing introductions | | Opportunity | Defined category of target parties and transactions | | Qualified Introduction | Documented intro meeting stated criteria with Client acknowledgment | | Transaction | Definitive agreement or closing event triggering fees | | Transaction Value | Defined base for fee calculation | | Fee | Amount payable for a Qualified Introduction resulting in a Transaction | | Tail Period | Post-termination window for fee eligibility |

2) Parties and Recitals

• Identify each party with jurisdiction and address.
• Recite business purpose and scope of Opportunities.
• State Finder's network/experience basis for engagement.

3) Services and Limitations

• Finder's role limited to introductions and basic background information.
• Explicitly exclude negotiation, structuring, valuation, advice, and solicitation.
• No authority to bind Client or act as agent.

Finder Role Limitation.
Finder will solely identify and introduce potential Opportunities to Client.
Finder will not: (i) negotiate terms; (ii) provide legal, tax, investment,
or valuation advice; (iii) solicit offers to buy or sell securities; or
(iv) bind Client in any manner.

4) Exclusivity Matrix

| Scope | Exclusive? | Carve-outs | |---|---|---| | Industry | Yes/No | Existing relationships | | Geography | Yes/No | Named exclusions | | Opportunity Type | Yes/No | Client-initiated deals |

5) Compensation Formula

| Component | Rule | |---|---| | Fee Base | Transaction Value definition (include/exclude earnouts, escrows) | | Rate | % or flat; tiers if applicable | | Trigger | Signature, closing, or receipt of funds | | Timing | Pay within X days of trigger | | Cap/Min | Any fee cap or minimum | | Allocation | Multiple finders: priority or pro-rata rule |

6) Tail Period

| Tail Length | Applies To | Proof Required | |---|---|---| | X months | Introduced parties | Written introduction + Client acknowledgment |

Tail must be tied to a documented Qualified Introduction; define what constitutes sufficient proof.

7) Regulatory Gate

| Scenario | Required Clause | |---|---| | Non-securities | Confirm no securities solicitation; no transaction-based fees tied to securities | | Securities-related | Finder represents broker-dealer registration or exemption basis [VERIFY] | | Foreign introductions | FCPA/UK Bribery Act compliance representations | | Regulated industry | Industry-specific compliance (e.g., healthcare AKS [VERIFY], insurance licensing) |

Broker-Dealer Compliance.
Finder represents that the Services do not require broker-dealer registration
under federal or state law, or that Finder holds all required registrations
and licenses and will provide evidence upon request. [VERIFY]

Anti-Corruption.
Finder will comply with all applicable anti-corruption laws, including the
FCPA and UK Bribery Act, and will not offer or provide anything of value to
influence any decision or obtain improper advantage.

8) Confidentiality

• Define Confidential Information and standard exceptions.
• Use-only-for-performance restriction.
• Return/destroy on termination.
• Survival: trade secrets indefinite; other confidential info X years.

9) Representations and Compliance

• Authority, no conflicts, compliance with laws.
• No bribery, kickbacks, or improper payments.
• No misrepresentation of Client or Opportunity.
• Client performs independent due diligence.

10) Indemnity and Liability

• Mutual indemnities tied to breach, misconduct, or legal violations.
• Notice, defense control, cooperation mechanics.
• Liability cap with carve-outs for fraud, willful misconduct, confidentiality breach.

11) Disputes

• Option A — Arbitration: rules, seat, arbitrator count, fees, interim relief.
• Option B — Litigation: exclusive venue, consent to jurisdiction.
• Include attorneys' fees provision if desired.

12) Miscellaneous

• Independent contractor status; no employment or agency.
• Tax responsibility; 1099 reporting; no benefits.
• Assignment restrictions (Client may assign to affiliates).
• Entire agreement; amendments in writing.
• Notices with delivery methods and deemed receipt.
• Counterparts and e-signatures.

Guidelines

• Never imply agency, fiduciary duty, or authority to negotiate.
• Avoid transaction-based fees tied to securities unless broker-dealer registration is addressed [VERIFY].
• Define Transaction Value precisely; ambiguity here is the top fee-dispute source.
• Add state finder-fee statute references only if confirmed [VERIFY].
• If government entities or healthcare referrals are involved, include anti-kickback language [VERIFY].
• For multiple-finder scenarios, specify priority, pro-rata, and double-introduction resolution.