Finder’s Fee Agreement (Sale of Business)
Under this Finder’s Fee Agreement (Sale of Business), a business owner can appoint an intermediary, i.e. a “finder” (sometimes called a “business broker”) to identify and introduce to the business owner one or more potential buyers of the owner’s business. (The owner may be a company or a sole trader.)
As and when the finder introduces any potential buyer/s and it or they then proceed to buy the business, the finder becomes entitled to a commission (the “finder’s fee”) payable by the business owner in return for that successful introduction.
The terms of this document set out the detailed terms of the engagement and are fairly even-handed in the way in which they protect and clarify the position of both the business owner and the finder. This template is therefore suitable for use by either:
· an owner looking to sell their business and to appoint a finder of a buyer for that purpose; or
· a business whose function is to act as a finder of buyers for businesses. It can use this form as its own standard terms of business when being appointed as a finder.
However, certain provisions in the template slightly favour the finder so that it is particularly suited to being used by a finder as its standard appointment document.
This form of agreement can be used for appointment of a finder on an exclusive basis, i.e. where the business owner is willing to appoint only one finder to act for it. Alternatively, this form can be used on a non-exclusive basis, i.e. where the business owner wants to have the freedom to appoint one or more other intermediaries in addition to the finder. By selecting one of the alternative sets of wording in the form, you can easily render the appointment either exclusive or non-exclusive.
This template also contains some optional provisions which can be included where the business owner engages the finder not only to find a buyer in return for the finder’s fee commission, but also where the business owner wishes to put the finder on a monthly retainer fee. The retainer is as well as the finder’s commission and it is payable in return for the finder providing additional services (e.g. help with negotiation) to smooth the way to a successful sale of the business.
There are provisions in the template covering alternative means of setting the amount of commission payable, advertising by the finder, expenses, confidentiality, anti-bribery, data processing, details of the assets comprising the business to be sold and other useful clauses.
Optional phrases / clauses are enclosed in square brackets. These should be read carefully and selected so as to be compatible with one another. Unused options should be removed from the document.
This Finder’s Fee Agreement (Sale of Business) is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.
If the subject matter of a sale is not the business or assets of a company or sole trader, but instead all of the shares, an alternative version of this template (the Finder's Fee Agreement (Sale of Shares)) is available in the Other Share Sale Documents subfolder. That template can be used where all of the shareholders of a company are looking to sell all of their shares to one or more outside buyers.
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