Prospective Client Broker Agreement - Factoring

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Prospective Client Broker Agreement - Factoring Powered By Docstoc
					This is an agreement between a broker and a factor representing a company for
brokerage services. The broker is engaged to solicit new clients and attract new
business opportunities for the factor’s company. In addition, the agreement provides
that the broker will receive a commission fee for any new business the company
receives due to the broker’s reference. This document should be used by small
businesses or other entities that want to hire a broker to market and solicit new clients to
the company.
           PROSPECTIVE CLIENT BROKER AGREEMENT – FACTORING



This Prospective Client Broker Agreement (“Agreement”) is made and entered into this
_______________ [Instructions: insert date] by _______________ [Instructions: insert name
of Factor], (hereinafter “Factor”), located at _______________ [Instructions: insert location]
and _______________ [Instructions: insert name of Broker] located at _______________
[Instructions: insert location] (hereinafter “Broker”).


                                            Recitals


WHEREAS both parties have the legal capacity to enter into this Agreement; and

WHEREAS Factor is in the business of _______________ [Instructions: insert description of
business]; and

WHEREAS Broker desires to enter into a relationship with Factor to solicit new clients for
Factor in accordance with Factor’s instructions and the terms of this Agreement, and thereby
earn commission income.



                                          Agreement
NOW, THEREFORE, Factor and Broker Agree as follows:

1. The above recitals are true and correct and form an integral part of this Agreement.


2. Rights and Responsibilities of Broker: The responsibilities of Broker are as follows:
   A. Broker shall solicit new clients for Factor. Further, Broker shall provide potential
      document packages for Factor’s review.
   B. Broker shall determine Broker’s method of obtaining clients, provided that the method is
      legal and ethical. Broker may utilize Broker’s employees and outside contractors to
      provide the services. Broker shall make sure that a potential client has all the necessary
      information pertaining to any transaction under this Agreement. Broker shall at all time
      interact with all clients in a professional manner.
   C. Broker agrees keep abreast of all current laws, rules, and issues affecting the factoring
       industry, in order to conduct its services at the highest level.
   D. Broker acknowledges that it does not have the authority to enter into any agreement for
      Factor, and, as such, will not take any action that will bind Factor in any manner.
   E. Broker shall assist Factor with all the necessary steps in completing a factoring
       agreement with a prospective client.
    F. Broker shall provide worker’s compensation insurance to all Broker’s employees and
        agents.
    G. All correspondence from Factor will be treated as confidential by Broker. This
        correspondence will not be disclosed without the written permission of Factor.
    H. _______________ [Instructions: set forth any additional rights or responsibilities of
       Broker]

3. Factor’s Rights and Responsibilities: The responsibilities of Factor are as follows:
   A. _______________ [Instructions: set forth any additional rights or responsibilities of
      Factor].


4. Commission: Factor will pay to Broker referral fees for _______________ [Instructions:
   insert qualification for paying commission]. The following commission structure will
   apply:
   A. Factor shall pay Broker a commission of _______________% [Instructions: Insert
       percentage number] of the amount Factor receives from a client referred by Broker.
   B. A commission will be “earned” once the client’s payment is received by Factor.
   C. On a _______________ [monthly] [Instructions: Insert relevant timeframe] basis,
       Factor will provide an accounting to Broker. Within _______________ [Instructions:
       Insert number of days] days of the end of each month.
   D. Factor shall compensate Broker for the entire life of the relevant client account with
       Factor, unless this Agreement is earlier terminated.


5. Independent Contractor Status: Broker expressly acknowledges that Broker will be acting as
   an independent contractor and not as an employee, for all purposes, including payment of
   Social Security withholding tax and all other federal, state and local taxes. The Broker shall
   be free to set its own hours and appointments. Broker shall not hold himself out to the public
   as an employee, agent, partner or representative of Company.


6. Exclusivity: The appointment of Broker hereunder is _______________ [Instructions:
   insert either “exclusive” or “non-exclusive”] [Comment: User should choose either to
   form an exclusive or non-exclusive relationship with the Broker.]


7. Separability and Governing Law: If any portion of this Agreement shall be found to be void
   or unenforceable, it shall in no way affect the validity or enforceability of any other portion
   hereof. This Agreement shall be interpreted according to the laws of the State of
   _______________________ [Instructions: Insert state].


8. Power of acceptance: It is understood that this agreement is only authority to solicit clients,
   and that such clients are to be brought to the attention of Factor for Factor’s approval and
   acceptance.


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9. Term and Termination: The term of the Agreement shall be for ____ [one (1)]. [Comment:
   These numbers are not provided for by law, but can be any number the user chooses]
   year and shall automatically renew unless terminated by either party. Either party may
   terminate this Agreement at any time without cause upon thirty-day written notice to the
   other party.


10. Continuing Obligations: Notwithstanding any termination of this Agreement Factor shall
    continue to deliver Receivables information to Broker and turn over all collections to Broker
    as herein provided until all Obligations shall have been fully paid and satisfied, and until then
    this Agreement shall remain in full force and effect as to and be binding upon Factor, and
    Broker shall be entitled to retain its security interest in all existing and future Receivables
    and other security and collateral.


11. Time of essence. Time is declared to be of the essence of this agreement.




This agreement has been executed by the parties on the day and year first above written.




Broker:

________________________

By      ________________________

Its     ________________________

Date    ________________________



Factor:

________________________

By      ________________________

Its     ________________________

Date    ________________________



© Copyright 2012 Docstoc Inc.                                                                      4

				
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Description: This is an agreement between a broker and a factor representing a company for brokerage services. The broker is engaged to solicit new clients and attract new business opportunities for the factor’s company. In addition, the agreement provides that the broker will receive a commission fee for any new business the company receives due to the broker’s reference. This document should be used by small businesses or other entities that want to hire a broker to market and solicit new clients to the company.