Contracts and Agreements

Transcription

1 Contracts and Agreements Contracts and agreements foster mutually beneficial working relationships and ensure an amicable and successful endeavor for both parties. With that in mind, much thought and precise tailoring is necessary to create an appropriate contract suitable for both sides. When drafted thoughtfully, contracts help to clarify the expectations of each party as well as minimizing the potential for future disputes. Codes of Ethics and Standards The Association of Fundraising Professionals (AFP) Code of Ethical Principles and Standards and Imagine Canada s Standards Program provide some useful and important considerations when drafting contracts and agreements. Standard Forms of Agreement AFP has provided several standard forms of agreement as templates that can be tailored to your individual purposes. AFP thanks Venable LLP for their assistance in drafting these forms. Please keep in mind these model contracts are instructive in nature. They are not intended to be one-size-fits-all documents to be replicated in their entirety. To help you tailor the documents such that they fit both parties needs, explanations are provided within each form to help you and your legal advisors better understand the purpose of the contract/agreement and each specific clause and provision. We highly recommend that you adapt the documents for your specific, individual circumstances. Standard Forms of Agreement available are for arrangements between: Model Professional Fundraising Agreement Corporation Model Professional Fundraising Agreement Individual All of the documents listed above are Word documents. Almost every state that regulates professional fundraisers requires that a written agreement be in place between the professional fundraiser and the nonprofit with which the fundraiser is working. Many states specify by statute mandatory contractual provisions to be included in contracts and/or require that the contract be filed in the state. We have NOT included in these model agreements all contractual elements that may be required by your relevant state(s) as this will vary depending on the states in which solicitations are conducted and can change quickly. Your organization s legal advisers should approve all contracts/agreements specific to your organization. Association of Fundraising Professionals 4300 Wilson Boulevard, Suite 300, Arlington, VA U.S. & Canada: +1 (800) Mexico: +1 (866) Fax: +1 (703) afp@afpnet.org facebook.com/afpfan twitter.com/afpihq youtube.com/user/afpihq linkedin.com/company/

2 BACKGROUND: This model agreement is for use in contracting with professional fundraisers, sometimes also called professional solicitors. This model in particular is designed for use with individual fundraisers. Approximately 41 states regulate the activities of professional fundraisers with varying requirements such as registration, obtaining a bond, and having or filing a written contract with the nonprofit client. Each state has adopted its own definition of professional fundraiser but the typical variation of this definition is along the lines of, any person who, for compensation, performs for a charitable organization or sponsor any service in connection with which contributions are or will be solicited in this state. Almost every state that regulates professional fundraisers requires that a written agreement be in place between the professional fundraiser and the nonprofit with which the fundraiser is working. Many states specify by statute mandatory contractual provisions to be included in contracts and/or require that the contract be filed in the state. Note that we have NOT included in this model agreement all contractual elements that may be required as this will vary depending on the states in which solicitations are conducted and can change quickly. Therefore, while we encourage you to use this sample professional fundraiser agreement as a base, consultation with legal counsel is recommended to confirm the specific requirements in the state in which solicitations are to occur. This Agreement is made between the ABC Charity ( ABC ), a [insert state of incorporation] nonprofit corporation, recognized as exempt from federal income taxation under Code [insert tax-exempt status, i.e. 501(c) (3), as applicable], with an address of [insert charity address] and, an individual contractor ( Fundraiser ). ABC and Fundraiser may each be referred to as a Party and collectively as Parties. Fundraiser shall be further identified as follows: Telephone: - - [insert contact telephone] Address: [insert address] [insert ] Fundraiser shall provide his or her social security number and any other necessary information for invoicing or tax purposes to ABC within 48 hours of the effective date of this Agreement. Although it seems elementary, it s very important to ensure that the proper parties and legal entities are listed (for example, whether the nonprofit entity is the parent organization, chapter, or a subsidiary of the national organization) to ensure that the benefits or liability under the contract do not flow to the wrong party. Additionally, the legal address of the charitable organization is a required contractual element under several state charitable solicitation statutes. Finally, it is recommended that the further information be listed in this section to be easily identified for payment and tax purposes and follow-up questions. In consideration of the mutual promises and consideration set forth below, the Parties agree as follows: 1. Services Provided A. ABC desires that Fundraiser perform, and Fundraiser agrees to perform, services as a Professional Fundraiser / Professional Fundraising Consultant [select one] described in Exhibit A (the Services ). Services shall be performed in the following geographic areas: [describe geographic areas where fundraising will be conducted, i.e. nationwide; in the State of Maryland; throughout Maryland, DC, and Virginia.] 2

3 Some states have separate registration responsibilities for Professional Fundraising Consultants. A Professional Fundraising Consultant is generally defined as any person who, for compensation, plans, conducts, manages, advises, consults, or prepares materials for, or with respect to, the solicitation of contributions in this State for a charitable organization, but who does not actually solicit any contributions nor employ others to solicit or hold funds received from solicitations. Because of the distinction in legal responsibilities, it is recommended that the Fundraising Agreement specify which type of services the Fundraiser will perform. Generally, registration would not be required in a particular state under both categories; if the Fundraiser is both advising on a campaign and conducting solicitations, the Fundraiser would usually be deemed a Professional Fundraiser under applicable state statutes and should be designated as such in the Fundraising Agreement. Additionally, at least one state requires that the geographic area of fundraising specifically be stated in the Agreement. As the geographic scope will also determine each Party s charitable solicitation registration responsibilities, it is recommended that this be documented in the Fundraising Agreement. B. Fundraiser shall perform Services in a professional manner and shall devote his or her best efforts, skills, and abilities to perform Services and further the interests of ABC in connection with this Agreement. Without limitation, Fundraiser shall in providing Services act at all times in a manner which: (1) In the reasonable opinion of ABC does not and is not likely to damage ABC s good name, image reputation, or intellectual property rights; (2) Is not misleading to donors, potential donors, or the general public. C. Satisfactory performance by Fundraiser of Services to be provided under this Agreement, including acceptability and timeliness of the work delivered, shall be determined by ABC, in its sole and exclusive discretion. 2. General Requirements and Limits on Services A. Compliance with Tax-Exempt Status. All Services performed pursuant to this Agreement shall be for [Insert purpose for which recognized as tax-exempt, such as charitable and educational activities or activities that promote a common business interest ] consistent with ABC s status as an organization exempt from federal income tax under [Insert tax-exempt status, i.e. Section 501(c)(3), Section 501(c)(6)] of the Internal Revenue Code ( IRC ). It is important to state that the Fundraiser should at all times protect the tax-exempt status of the contracting organization. In some instances fundraising activities have led the IRS or courts to find that the organization is no longer tax-exempt, such as when the payments made to outside fundraisers constituted a more-thaninsubstantial private benefit conferred by the organization. B. No Electioneering. In the course of providing Services under this Agreement, Fundraiser shall not participate in or intervene in (including the publishing or distributing of statements), any political campaign on behalf of or in opposition to any candidate for public, nor shall Fundraiser provide a selective benefit to any political party or candidate. 3

4 C. Charitable Solicitation and Fundraising Registration. Each Party warrants that it has individually assessed and complied with all applicable charitable solicitation statutes including commercial co-venturer statutes and with all legal obligations triggered by Fundraiser s provision of Services under this Agreement including, but not limited to, state registration and bonding provisions. Further, Fundraiser shall file a copy of this Agreement with state regulators where required by law, and shall assist ABC by providing information in a timely manner when requested by ABC to fulfill any of ABC s charitable solicitation registration responsibilities. A list of states in which Fundraiser is currently registered as a Professional Fundraiser / Professional Fundraising Consultant is attached as Exhibit B, and Fundraiser shall provide timely updates to such list to ABC should Fundraiser s status in any state change or should it register in additional states. The above obligation is critical to a Fundraising Agreement, as almost every state specifies that charities shall only contract with Professional Fundraisers or Professional Fundraising Consultants who are in compliance with state-specific requirements for the activities to be performed. Therefore, the nonprofit will want to ensure that Fundraiser is, or will be, in compliance with all laws related to Professional Fundraisers or Professional Fundraising Consultants prior to services being performed, and be able to terminate the Agreement based on breach of a warranty should it discover that Fundraiser is not compliant. E. Compliance with Applicable Law. Fundraiser shall perform Services to be provided under this Agreement in compliance with all applicable federal, state, and local laws; statutes; rules; regulations; and orders. Without limitation of the foregoing, if the activities of this Agreement involve Fundraiser performing telemarketing services, Fundraiser shall comply with all law applicable to such activity including requirements of the Telephone Consumer Protection Act. F. Insurance. Fundraiser will provide ABC with evidence of liability insurance of $ [fill in amount of insurance requested] for the purposes of providing the Services under this Agreement prior to beginning work under this Agreement. Fundraiser will retain such insurance coverage throughout the duration of the Agreement, and shall provide ABC with evidence of the same upon request. The amount of insurance in this section can be modified on a case-by-case basis. If contracting with a new Fundraiser, the nonprofit might wish to state that evidence of insurance should be provided as an exhibit to the Agreement. 3. Primary Contact A. The primary contact at ABC for purposes of this Agreement shall be: [Insert Name and Contact Information] [Insert Primary Contact Name] shall be the only individual authorized to grant any approvals required by this Agreement. ABC shall have the right to name and replace the primary contact person in its sole and absolute discretion, by written notice to Fundraiser. It is advisable to establish at least one person at the nonprofit to give approvals for fundraising activities or decisions not specifically outlined by this Agreement. Typically this would be someone such as a Director of Development. 4

5 4. Compensation and Expenses A. Compensation In consideration of the satisfactory performance by Fundraiser of Services under this Agreement, ABC shall pay to Fundraiser $, which shall be billed at the end of each month by invoice. Upon a reasonable estimate of the gross contributions to be received of [insert reasonable projection of contributions to be received] the total amount of compensation received during the term of this Agreement by Fundraiser, including reimbursable fundraising expenses shall represent % [calculate percentage] of gross contributions received. Deducting any fundraising expenses to be paid by ABC, the amount to be retained by ABC shall be approximately % [calculate percentage] of the gross contributions received. The payment provisions of Fundraising Agreements are of great concern to state regulators. Most states specify that payment may be stated as (a) a fixed amount, (b) an amount derived from a formula, or (c) a percentage of the gross revenue raised. It is worth noting that Standards 21 and 24 of the Association of Fundraising Professionals (AFP) Code of Ethical Principles and Standards prohibit percentage-based (also known as commission-based) compensation. A position paper developed by AFP is available here. No matter the way in which compensation is set, many states will also require a statement within the contract of a reasonable estimate of the percentage of gross contributions received that this payment will represent. Given Standards 21 and 24 discussed above, these percentages are included in this Agreement only as estimates to satisfy state law requirement and should not form the basis for compensation under the Agreement. It is often hard to estimate the overall amount to be received in a fundraising campaign so it is recommended that the nonprofit first ask the Fundraiser to estimate a conservative amount of funds to be raised. Some states will also require that the corresponding percentage of gross contributions to be retained by the charity be specified. In calculating the percentage to be retained by the charity, any fundraising expenses to be paid by the charity should be deducted from the net amount retained. It is also important to list the expenses to be paid by the Fundraiser and the expenses that will be the responsibility of the nonprofit. At least one state requires that an estimate of the expenses to be paid by the nonprofit be stated within the Agreement. B. Expenses. Fundraiser shall be responsible for payment of all expenses incurred in providing Services under this Agreement except as otherwise stated herein. ABC shall reimburse Fundraiser for the following reasonable expenses incurred by Fundraiser in performance of services under this Agreement: reasonable documented travel expenses, postage, commercial messenger services [modify as needed]. Any and every expenditure in excess of $1,000 must be authorized in advance by ABC. To receive reimbursement for expenses, Fundraiser shall submit monthly a detailed description of expenses incurred along with appropriate documentation. Fundraiser reasonably estimates that reimbursable expenses under this Agreement shall not exceed $ [insert reasonable projection]. C. Invoicing Procedures. Fundraiser shall submit invoices at the intervals specified in Section 4(A) for the performance of services under this Agreement. Invoices shall be submitted on letterhead to the ABC primary contact. 5

6 To be considered properly prepared, invoices submitted to ABC must include: Invoice number; Invoice date and billing period; Description of tasks performed and hours spent performing such tasks broken out by day [modify level of description requested as desired]; and Total due on invoice. No later than thirty (30) days following the termination of this Agreement or satisfactory performance of Services hereunder, Fundraiser shall submit to ABC a final invoice for any amounts that remain to be paid. Payment of such invoice shall be made by ABC only after acceptance by ABC of proof of Services performed under this Agreement, and return of any ABC Material or Confidential Information as specified herein. D. Payment Terms. Subject to the terms and conditions of this Agreement, ABC shall pay each properly submitted invoice no later than thirty (30) days after receipt. ABC shall promptly notify Fundraiser of an intention to withhold any portion of a submitted invoice pursuant to Section 4(E) hereof and shall specify the reason(s) thereof. For a fixed price contract, note that the invoice schedule as listed in the Agreement can be adjusted as desired by the Parties (i.e. there is no state requirement that Fundraiser be paid on a monthly basis). E. Reduction or Withholding Permitted. In addition to other remedies available to ABC at law or in equity, if, in the reasonable opinion of ABC, Fundraiser fails to perform in accordance with the terms of this Agreement, ABC may refuse to approve, or limit approval of, any invoices for payment, and may cause payments to Fundraiser to be reduced or withheld until such time as ABC reasonably determines that Fundraiser has met the performance terms as established by this Agreement. Fundraiser s failure to submit required reports or other specified items when due, or failure to deliver required Services, may result in the withholding of payments under this Agreement unless such failure arises out of causes beyond the reasonable control and without the fault or negligence of Fundraiser. ABC shall promptly notify Fundraiser of any such withholding of payment of all or part of any invoice submitted. Importantly, as with any compensation arrangement, it must be determined that the compensation paid to the Fundraiser is no more than reasonable compensation, as otherwise this could be seen as a private benefit under federal tax law and jeopardize the organization s tax-exempt status. 5. Collection / Deposit of Funds Although funds may be originally collected by Fundraiser, they shall at all times be held in trust by Fundraiser subject to the ultimate custody and control of ABC. To this end, any funds temporarily held by Fundraiser must be deposited in the following account, held by and under the sole direction of ABC, within five (5) business days of receipt. Only ABC may have the power to make withdrawals from this account. Bank: [insert bank name and branch] Account Name: [insert name associated with account] ABC shall provide the account number and any other necessary account information to Fundraiser within 48 hours of the effective date of this Agreement. 6

7 Note that the provision above, Collection / Deposit of Funds would be inapplicable to a Professional Fundraising Consultant agreement and should be removed. Under most state statutes, if a Professional Fundraising Consultant has custody or control of the funds from solicitations, he or she will be subject to the heightened regulatory requirements of a Professional Fundraiser. 6. Duration of Agreement and Termination A. This Agreement shall be effective as of ( Effective Date ), and shall continue in force until, [insert dates] unless sooner terminated as provided below. The Parties may renew or renegotiate the terms of this Agreement, by mutual agreement set forth in writing and signed by both Parties. B. Solicitation activities may be performed under this Agreement as of the Effective Date or the fifteen (15) days following the filing of this Agreement with the state in which solicitations are to be performed, whichever is later. Solicitations may continue through the date of termination. ABC shall at all times retain ultimate control and approval over the content and volume of any solicitation. Many states require that the dates of solicitation be specified within the Fundraising Agreement for fundraising services. Additionally, a good number of states require that the agreement be filed a certain number of days before solicitations begin (we have used 15 days as a conservative example within the Agreement). Some states also require approval of the contract be received before solicitations begin. Because the requirements related to filing of contracts vary amongst states, it is recommended that the nonprofit consult counsel regarding the timing of solicitations. The nonprofit should ensure that the dates listed in this Section 6(B) correspond with those that are filled in on Exhibit A and/or reported on any separate state charitable solicitation filings. Additionally, note that Section 6(B) would be not be applicable to a Professional Fundraising Consultant, and should be removed. Under most state definitions, a Professional Fundraising Consultant may not perform solicitations. Finally, some states will also require that the date of solicitation be included in a Solicitation Notice to be filed with the state and the Party filing the Solicitation Notice shall ensure that the dates on the notice match the dates in this section. C. This Agreement may be terminated by either Party: (1) if the other Party materially breaches any term or condition of this Agreement and fails to cure such breach within 15 days after receipt of written notice of such breach by the non-breaching Party; (2) For any other reason, upon provision of 30 days written notice to the other Party. The number of days notice of termination in both of the above paragraphs is flexible. D. In the event of such early termination, Fundraiser shall take immediate action to minimize all expenditures financed by this Agreement, and ABC shall pay Fundraiser for all authorized expenses incurred prior to the date of termination, provided that ABC may offset this amount against any damages caused by any breach by Fundraiser of the Agreement. 7

8 E. On expiration or termination of the Agreement, Fundraiser shall promptly: Cease using and authorizing the use of any name or trademark or intellectual property of ABC; and turn over to ABC all reports, data, donor lists, prospect information, campaign materials, work publications, work products, records, designs, papers, materials, and information relating to the planning, implementation, and performance of this Agreement. The nonprofit should supplement the list in 6(E) with appropriate titles of any known work product or related materials to be produced by Fundraiser and retained by the nonprofit. The nonprofit should also avoid giving any intellectual property or other rights to the Fundraiser to materials produced that are specific to the nonprofit s campaign. 7. Ownership of Property A. ABC is the sole and exclusive owner of its source documents and any financial, statistical, membership, donor, prospects, personnel, or other information provided to Fundraiser under this Agreement. ABC is also the sole and exclusive owner of its name, logo, and other proprietary materials. All files, papers, records, documents, drawings, and other items and materials relating to this Agreement and/or to the business of ABC, or prepared, developed, used, or provided under this Agreement shall at all times remain the exclusive property of ABC, may only be used as provided pursuant to the Agreement, and shall be delivered to ABC upon its request. Fundraiser shall have no property rights or interests in such materials, including, without limitation, donor lists, prospect lists, scripts, and ABC shall have the right at all times to inspect, review, and access any of its property that is in Fundraiser s possession. B. Fundraiser acknowledges and agrees that all work performed and material created under this Agreement, including all contributions of his or her agents, representatives, and contractors to such materials, shall constitute a work made-for-hire, and that ABC shall be deemed the author of such works and materials for all purposes under the Copyright Act. ABC shall own all rights in the works and materials including without limitation the right to transfer or license any of its rights and to prepare derivative works based upon the materials. To the extent that the work or materials may be ineligible for work made-for-hire status, Fundraiser assigns to ABC all right, title, and interest to the copyright and all other tangible and intangible property or ownership rights (including all renewals and extensions) relating to all materials created by or for ABC pursuant to or in the performance of this Agreement. At ABC s request, Fundraiser agrees to execute all necessary or appropriate documents and take all other reasonable steps to document or formalize such rights in these materials. Fundraiser waives any moral rights Fundraiser may have with respect to the works. The provisions above are key for protection of the nonprofit s valuable list of donors or prospective donors as well as for all materials specifically created for the nonprofit by fundraiser. According to Standard 18 of the AFP Code of Ethical Principles and Standards, all donor and prospect information created by, or on behalf of, an organization or a client is the property of that organization or client and cannot be transferred or utilized except on behalf of that organization or client. In general, the donor list containing donors or prospective donors names, addresses, telephone, and fax numbers, and possibly addresses generally are not subject to copyright protection by the nonprofit because it does not possess the minimum originality of expression required by copyright law. Copyright only protects original expressions of ideas not the underlying facts or data. As such, donor lists and similar intellectual property would not fall under the work-made-for-hire doctrine. However, pursuant to the section above, any donor list created, enhanced, or modified by the Fundraiser would continue to be the property of the nonprofit through assignment. 8

9 8. Confidentiality A. Through its performance of Consulting Services, Fundraiser may have access to and/or learn certain confidential information of ABC or third parties (collectively, Confidential Information ). Confidential Information is all nonpublic information that ABC considers confidential or proprietary information of ABC or third-party sources, regardless of whether such information is marked or designated as such by ABC. Confidential Information shall include, but is not limited to, information regarding ABC s operations, programs, activities, policies, procedures, practices, financial condition, trade secrets, donor lists, membership lists, prospect lists, and standards of ABC, its members, or third parties. Confidential Information also shall include, but is not limited to, unpublished or pre-release versions of ABC standards, white papers, and other documents and information, or internal use only or limited circulation documents and information. Confidential Information shall retain its confidential nature whether or not partially developed, supplemented, or enhanced by Fundraiser during his engagement with ABC. Confidential Information does not include any information that has become publicly known and made generally available through no wrongful act or omission of Fundraiser. B. Unless expressly authorized by ABC, both during and after the Term of this Agreement, Fundraiser will not use Confidential Information for its own benefit or for the benefit of anyone other than ABC, or disclose such information to anyone outside of ABC, other than to Fundraiser s agents as necessary for performance of Services under this Agreement. Fundraiser shall use all reasonable efforts to keep this information confidential. C. Fundraiser understands and agrees that the use and the disclosure of Confidential Information to any person or entity other than ABC or to any person outside of ABC would cause severe competitive and financial damage to ABC. Fundraiser acknowledges and agrees that if the provisions of this Agreement are breached, monetary damages alone will not be sufficient and ABC shall be entitled to equitable relief, including the issuance of an injunction. In addition, if the provisions of this Agreement are breached by Fundraiser or anyone given access to Confidential Information by or through Fundraiser, then Fundraiser agrees to indemnify and hold harmless ABC and its successors and assigns, from and against any resulting loss, cost, damage or expense undertaken, paid, awarded, assessed, incurred, or suffered by ABC and/or to any parties that provided the Confidential Information to ABC. In addition to the foregoing, Fundraiser also shall be liable to ABC for all court costs, attorney s fees and other expenses incurred by ABC in enforcing its rights under this Agreement and recovering damages and obtaining other appropriate relief. D. Upon the termination of this Agreement, or at any time upon the request of ABC, Fundraiser shall return to ABC all printed, audio-visual and electronic documents, data, and other materials, including all originals, copies, and extracts thereof, containing or referencing any Confidential Information or otherwise relating to ABC s organization or operations, and all other property of ABC then in his possession. The obligation of confidentiality shall survive termination of this Agreement. The confidential information provisions above also serve to protect the nonprofit s valuable property like its donor lists and prevent the Fundraiser from disclosing the donor list and other confidential information to another party for reasons other than performance of fundraising services for the nonprofit. These provisions will help to avoid the adverse consequences of the Fundraiser utilizing the nonprofit s donor list to solicit for other causes. In the unfortunate circumstance that this provision is breached, strong remedies are provided for the nonprofit, including injunctive relief to halt the disclosure and indemnification for any damages suffered by the nonprofit. 9

10 9. Warranties A. Each Party warrants that it has full power and authority to enter into and perform this Agreement. B. Fundraiser warrants that all material produced by Fundraiser in connection with this Agreement is original with Fundraiser, and Fundraiser s work shall not infringe any copyright, defame any person or entity, or violate the privacy rights or any other right of any person or entity. C. In performing Services under this Agreement, Fundraiser warrants that he or she will act in conformance with prevailing ethical standards applicable to Fundraiser s usual conduct including, but not limited to, the Association of Fundraising Professionals Code of Ethical Principles and Standards, and to the customs and practices of persons and entities engaged in similar activities. 10. Indemnification Each Party agrees to indemnify and hold harmless the other Party, and such Party s employees, representatives, officers, directors, and agents from any and all liability, loss, damage, cost, or expense, including reasonable counsel fees and expenses, paid or incurred by reason of the indemnifying Party s breach of any of the obligations, covenants, representations, or terms contained in this Agreement or by reason of the negligent or intentional conduct of the indemnifying Party relating to performance of this Agreement. Any reasonable counsel fees or expenses shall be paid by the indemnifying Party as incurred by the other Party. An adequate indemnification provision is important for almost any agreement, especially when a nonprofit is contracting with an independent contractor to perform services on behalf of the nonprofit. Here, each Party agrees that should the other Party suffer harm related to the indemnifying Party s negligent or intentional actions, that the indemnifying Party will reimburse or make payment for the other Party s legal expenses and any resulting liability. This provision would be invoked, for example, if the Fundraiser made misrepresentations to a donor and the donor took action against the nonprofit. Importantly, this provision is mutual to be fair to both Parties and includes that payment is to be made as fees are incurred to ensure that the Party to be indemnified is able to cover its legal fees without having to await reimbursement. 11. Access to Information and Right of Inspection A. Upon provision of reasonable notice to Fundraiser, ABC shall have the right to review and inspect activities conducted and information and materials collected pursuant to this Agreement, including reports, data, contact logs, donor reports, scripts, drawings, drafts, studies, communications, estimates, computations, and other materials prepared by or for Fundraiser. This provision is important to allow the nonprofit to follow-up on any inquiries received by the nonprofit from the public or its donor base regarding fundraiser s activities and could also be important should the nonprofit wish to verify the financial accounting of donation by Fundraiser. B. Fundraiser shall maintain and make available for the inspection of ABC or its duly authorized representative at reasonable times appropriate accounting records and other evidence of costs incurred in connection with this Agreement. Fundraiser shall retain such records for three years from the date of final payment or until all disputes arising under this Agreement have been resolved. 10

11 Note that although three years is the average time required for recordkeeping related to professional fundraising activities under state charitable fundraising statutes, some individual states may require records to be kept by the nonprofit or Fundraiser for longer periods of time. 12. Miscellaneous A. Independent Contractor. Fundraiser is an independent contractor and is not an employee of ABC. Accordingly, Fundraiser is responsible for payment of all taxes and business license fees arising out of Fundraiser s activities under this Agreement and is not entitled to any ABC employee benefits. B. Assignment and Subcontracts. Neither Party may assign any rights or delegate any duties under this Agreement without the express prior written consent of the other Party. Fundraiser shall not subcontract any of the Services to be provided under this Agreement without the express prior written approval of ABC, and if such express prior written approval is obtained, Fundraiser shall ensure that any subcontractor complies with all provisions of this Agreement, including obtaining any necessary registrations or approvals under state charitable solicitation statutes. C. Modification. This Agreement cannot be changed or modified except by instrument in writing executed by each of the Parties. D. Notices. All notices pertaining to this Agreement shall be in writing and shall be transmitted either by personal hand delivery, by overnight delivery, through the United States Postal Service by registered or certified mail, return receipt requested, or by by either Party to the other. The addresses set forth below for the respective Parties shall be the places where notices shall be sent unless written notice of a change of address is given: (i) For ABC: [address] [ ] (ii) For Fundraiser: [address] [ ] E. Cancellation. This Agreement may be cancelled by ABC without cost, penalty, or liability for a period of ten (10) days following the date of execution. Such cancellation shall be effectuated by ABC s service of written notice to Fundraiser. If written notice is mailed, it shall be through certified mail and cancellation shall be deemed effective upon receipt of the written notice by Fundraiser. Several states require that the nonprofit be given a right of cancellation. This mandatory cancellation period can vary on a state-by-state basis and some states have specific language that must be included. Therefore, although we have included a generic cancellation provision in this Model Agreement, the Parties should seek legal counsel regarding cancellation provisions for each individual campaign. 11

12 F. Controlling Law, Venue, and Severability. This Agreement shall be governed by and construed under the laws of the State of [insert state], without reference to conflict of law principles. Both Parties agree to submit to personal jurisdiction in the State of [insert state] and further agree that any cause of action arising under this Agreement shall be brought exclusively in a court in [insert jurisdiction/state]. In the event that any portion of this Agreement is held to be unenforceable, such portions shall not limit or otherwise modify or affect any other portion of this Agreement. Generally, the choice of controlling law and venue should be listed as the state in which the majority of the nonprofit s activities are taking place, where the nonprofit or Fundraiser is incorporated, or where the activities under the Fundraising Agreement are taking place. The Parties should select a state in its form agreements in which it would be convenient for the Parties to litigate. Note that neither the choice of law as listed in the agreement nor the venue will affect the Fundraiser s or the nonprofit s registration responsibilities with regards to charitable solicitation. This is a separate and distinct analysis depending on where the solicitation (as defined by state law) is taking place. G. Integration. This Agreement and Exhibits attached hereto set forth the entire Agreement of the Parties and replace and supersede all other contracts, agreements, and understandings, written or oral, relating to the subject matter hereof. H. No Waiver. The failure of either Party to this Agreement to insist upon the performance of any of the terms and conditions of this Agreement shall not be construed as a waiver of any breach of that provision or of any other provision. I. Survival. The duties, obligations, and rights imposed or granted in Sections 7, 8, 9, 10, and 12 and paragraphs 6.D and 11.B of this Agreement survive termination of this Agreement. J. Execution. This Agreement may be executed in several counterparts, each of which shall be deemed an original. 12

13 IN WITNESS WHEREOF, the Parties, intending to be legally bound, have executed the foregoing Agreement. ABC Charity By: [NAME, ABC PRESIDENT] Date: By: [NAME, MEMBER, ABC BOARD OF DIRECTORS] Date: At least one state requires that the Fundraising Agreement be accepted by the President of the nonprofit and one other member of the nonprofit s Board of Directors. Signature by the President and a member of the Board of Directors will also satisfy more lenient requirements in other states that the agreement be signed by two representatives of the charitable organization (specific positions not stated). Fundraiser By: [NAME] Date: 13

14 EXHIBIT A SCOPE OF SERVICES Fundraiser shall provide to ABC fundraising services, in support of ABC s charitable mission, [insert charitable mission]. The fundraising services shall include: Draft of Campaign Strategy / Performance of Feasibility Study Prospect Identification Drafting of Pre-Call Introductory Communications Conducting Telephone Solicitations (intent and closing calls) Drafting Follow-up Donor Communications Performing Evaluation/Fulfillment/Recognition Reporting Development and Implementation of Strategies for Volunteer Engagement for Fundraising Efforts Creation of Campaign Materials including Letters, Webpage, Social Media Materials, Solicitation Cards, etc. The timeline for the services to be provided will follow the general schedule: Dates (on or about) [to be filled in] Program Phase [to be filled in] The services to be provided can vary greatly depending on the Fundraiser selected and the nonprofit s needs. The bullets provided should be used as sample services for discussion, but it is imperative that this section be customized depending on the individual campaign to be conducted. The nonprofit should ensure that its expectations are clearly defined as services to be provided and that the timeline for these services be mutually agreed upon. Although this section can later be modified, it is important that it be robustly populated at the time of signing the Fundraising Agreement and any future modifications be mutually agreed upon in writing. Any direct solicitation shall take place between and, which period may be abbreviated or extended by written agreement of both Parties [insert dates]. Several states have a requirement that the solicitation period be listed as a provision in the Fundraising Agreement or on supplemental forms. To ensure that both Parties are reporting identical solicitation periods, it is recommended that the dates of solicitation be stated in the Agreement. The nonprofit may wish to list that the period may be changed at the direction of ABC, however, this could require adjusted compensation to the Fundraiser, and therefore, a written agreement by both Parties is likely the most efficient and clear documentation of a revised timeframe. 14

15 EXHIBIT B STATES IN WHICH FUNDRAISER IS REGISTERED AS A PROFESSIONAL SOLICITOR / PROFESSIONAL FUNDRAISER State Registration / License Number 15

16 EXHIBIT C [OPTIONAL] SPECIFIC ADDITIONAL PROVISIONS ON CHARITABLE SOLICITATION AND FUNDRAISING REGISTRATION [The Parties may wish to incorporate Exhibit C upon consultation with counsel to document specific campaign requirements such as state-specific cancellation provisions or disclosure requirements. If Exhibit C is included, a reference to Exhibit C should be incorporated into the body of the Agreement.] 16