Stonebridge Associates Agreement

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Stonebridge Associates Agreement

A Stonebridge associates’ agreement is a legal contract between a financial advisory firm, Stonebridge Associates, and any company that requires the services of this financial advisory firm. As there is a contract between two parties, such agreements are known as bipartite agreements. The firm, Stonebridge associates, is a limited liability corporation, which provides financial advisory services to medium-sized companies and emerging companies. The services provided by this company include professional advice on mergers and acquisitions, private placements of equity and debt. The advisory services include business opinions and recapitalizations. The agreement will include the services opted for by the client and fees for the same. The nature of service being provided and the objective to be achieved are also mentioned.

When Do You Need Stonebridge Associates Agreement?

A Stonebridge associates agreement is required when the financial advisory firm, Stonebridge associates, is approached by a client to provide a service that is offered by them. The purpose of a Stonebridge associates’ agreement is to ensure that there is full clarity with regard to the nature of the service being provided and the remuneration being offered by the client. The financial advisory firm, Stonebridge associates, provides a range of services like mergers and acquisitions and business valuations. These services are designed to provide certain intended benefits to the client for which they pay the financial advisory firm a fee.

Inclusions in Stonebridge Associates Agreement

A Stonebridge associates agreement should include the name of Stonebridge associates and the client as this is a bipartite agreement.

Apart from this, the agreement should include some other details as well. Those details are the effective date of the agreement, a specific mention of engagement of an advisor, the details of the compensation being charged, details of the service being provided, the time frame within which the service should be completed, the right of Stonebridge associates to simultaneously provide professional services to rival businesses, provisions where the advisor is indemnified for any losses incurred by the client, the events which lead to termination of the agreement, the relationship between the two parties, the process for sending notices between the parties and the law governing the agreement.

How to Draft Stonebridge Associates Agreement?

While drafting a Stonebridge associates’ agreement, the following points need to be kept in mind. They are:

  • The names of the parties to the agreement and the relationship shared between them need to be stated
  • The nature of the service being provided by the financial advisory firm and the time frame for completion of the same
  • The penalty to be paid by the financial advisory firm in case of non-performance should also be included
  • The governing laws of the state under whose jurisdiction the agreement is being framed
  • The compensation that is payable to the advisor as well as the payment schedule
  • The rights and liabilities of the advisor as well as the client should be mentioned in detail
  • The indemnity clause which indemnifies the financial advisory firm from any losses, liabilities or damage suffered by the client

Benefits of Stonebridge Associates Agreement

The benefits of having a Stonebridge associates’ agreement are:

  • The interests of both the financial advisory firm, Stonebridge associates, and the client are protected. The financial advisory firm is ensured the professional fees for the engagement on satisfactory completion of the service, and the client is assured of high-quality service.
  • There is no dispute later on as the terms and conditions of the agreement with regard to the services being provided and the fees being paid are mutually agreed upon.
  • In the event of a breach of contract by either party, the agreement stands null and void
  • The financial advisor can simultaneously advise other clients, who might be rival firms, and this is not considered a breach of contract
  • The advisor is indemnified from any loss or liability incurred by the client on engaging the advisor

Types of Stonebridge Associates Agreement

The types of Stonebridge associate’s agreement are as under:

  • Ceiling on fee agreements: Under this type of agreement, the fees are paid on an hourly basis
  • Fixed fee agreements: In Fixed fee agreements, there is an initial base price, then you are charged extra for any other service you require
  • Pay on completion: Under this arrangement, the fees are paid to the advisory firm only on successful completion of the agreement
  • Holdback agreement: A certain percentage of the full fee is assured for the firm. When the firm completes the job successfully, then the remainder of the fee is paid.
  • Success fee agreement: Over and above the fee mentioned in the agreement, there is a provision for a success fee

Key Terms of Stonebridge Associates Agreement

The key terms of a Stonebridge associates’ agreement are:

  • Engagement of advisor: The reason the advisor has been engaged by the company including the details of the service
  • Compensation: The mode of compensation and the different forms will be mentioned here
  • Service: The nature of the service being provided, the mandatory information to be provided to the advisor by the client, and the responsibility of the advisor regarding data confidentiality
  • Business practice: The advisor is in the business of financial advisory and has the right to provide this service to other clients during the tenure of this agreement
  • Indemnification: The advisor is indemnified of any losses or liabilities incurred by the client due to the appointment of the advisor

Download Stonebridge Associates Agreement

If Stonebridge associates want to enter into a legal agreement with their clients, a Stonebridge associates’ agreement is necessary.

You can download a sample Stonebridge associates agreement here.

Stonebridge Associates Agreement Template

Stonebridge Associates Agreement


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