Date: ____________________________

LEAD PURCHASE AGREEMENT

Recitals

  1. WHEREAS, C-Loans, Inc. (herein "C-Loans") operates a series of commercial mortgage portals, including C-Loans.com, where borrowers, real estate brokers, mortgage brokers, developers and others can apply on-line for a commercial mortgage loan to over 750 different commercial mortgage lenders using one simple application form; and
  2. WHEREAS, the undersigned party (herein "Broker") owns a commercial mortgage brokerage company and wishes to offer the services of his commercial mortgage company to users of C-Loans.com;

Agreement

NOW, THEREFORE, the parties hereby agree as follows:

  1. C-Loans agrees to sell commercial mortgage loan leads to the Broker, and the Broker agrees to buy said leads from C-Loans;
  2. Compensation to C-Loans: The Broker agrees to pay to C-Loans the small fee per lead listed on C-Loans, typically in the range of $1 to $30 per lead, plus a contingent marketing fee of 37.5 basis points (three-eighths of one percent) of the loan amount upon the successful closing of any mortgage loan, mezzanine loan, or preferred equity investment for, or for the benefit of, the contact person on the lead or the owner of the property or the buyer of the property, or any related parties, including, but not limited to, partnership's, corporations, and limited liability companies, for a period of three years.
  3. No Refunds or Guarantees: The Broker understands that the loan applications on C-Loans are completed by the users with no assistance from C-Loans. Some loan applications will be worthless, while others will be wonderful. Since the initial cost of the wonderful applications has been set very low to make up for the worthless applications, there will be no refunds. In addition, C-Loans makes no warranty or guaranty as to the accuracy, honesty, and sincerity of the information contained on any loan application.
  4. Privacy, Non-Disclosure, and Financial Responsibility: The Broker agrees to keep confidential any information revealed on the loan applications provided by C-Loans, except when necessary to present the borrower's loan requests to potential lenders in the normal course of business. The Broker understands that each loan application is valuable to C-Loans and specifically agrees not to share these leads with any other party, other than the employees of his mortgage company. The Broker understands and agrees that he is financially responsible for all lead purchases made on his account and agrees to assume full responsibility for the security of his password.
  5. No Advance Fees: The parties hereby agree that some commercial mortgage brokers - often fraudulently masquerading as direct commercial lenders - charge unethical and often illegal advance fees for underwriting, processing, or other efforts to place, or make, commercial loans. These advance fees can range from as little as $100 to many tens of thousands of dollars. These advance fees are seldom refundable to the borrower, even if the commercial mortgage broker is unsuccessful in placing the commercial loan. The parties agree that these unethical commercial mortgage brokers bring great discredit to the industry and potentially to C-Loans, Inc. The Broker hereby agrees never to charge any sort of advance fee from any borrower, directly or indirectly, using the C-Loans System. SINCE THE PARTIES AGREE THAT AN ADVANCE FEE ARTIST BUYING LEADS FROM C-LOANS COULD GREATLY DAMAGE THE REPUTATION OF C-LOANS.COM, AND SINCE IT WOULD BE DIFFICULT FOR C-LOANS, INC. TO PROVE THE EXACT EXTENT OF THE DAMAGES TO ITS REPUTATION, THE PARTIES HEREBY AGREE THAT IN THE EVENT THE BROKER SHOULD CHARGE AN ADVANCE FEE ON ANY LEAD PURCHASED FROM C-LOANS, THE BROKER HEREBY AGREES TO PAY LIQUIDATED DAMAGES IN THE AMOUNT OF $50,000.
  6. Non-Circumvention: In the event the Broker purchases a lead where the Contact Person is a mortgage broker, the Broker promises not to circumvent the mortgage broker who entered the loan application into C-Loans. The Broker promises to make sure this mortgage broker earns a reasonable fee if the loan closes. The parties agree that mortgage brokers constitute 50% of the users of C-Loans.com and that it would cause serious, financial harm to C-Loans if mortgage brokers became unwilling to enter their loans into C-Loans because of the fear of having their clients stolen by other mortgage brokers, but the exact amount of these damages would be difficult to prove. The Broker therefore agrees that the liquidated damages of FIFTY THOUSAND DOLLARS ($50,000) represents a reasonable estimate of the damages to C-Loans in the event the Broker is proven to have circumvented the originating mortgage broker.
  7. Indemnity: The Broker agrees to indemnify, defend, and hold C-Loans harmless in connection with any claim by any C-Loans user arising out of the conduct of the Broker, his mortgage company, his agents, his employees, and any party with whom the Broker has shared the information on the loan application.
  8. Relationship of the Parties: The parties agree that C-Loans is merely a provider of marketing services, and the Broker is a buyer of marketing services. The parties specifically agree that C-Loans is not acting as a mortgage broker. C-Loans is not an agent of, or a subagent of the Broker. The Broker is not an agent of, or a subagent of, C-Loans.
  9. Liquidated Damages: The parties agree that it would be impossible, as well as it would be economically infeasible, for C-Loans to determine exactly how many loans closed that were the related to every commercial mortgage loan lead sold to the Broker by C-Loans. In plain English, it would be easy for the Broker to cheat C-Loans out of its contingent marketing fee. Therefore, the parties hereby agree that in the event that C-Loans proves that the Broker closed a loan in the which a contingent marketing fee was owed to C-Loans and said fee was not paid within five days of closing, it shall be conclusively presumed that the Broker cheated C-Loans on other transactions as well. The parties agree that a reasonable mortgage broker should close on the order of one loan for every twenty leads he buys. THEREFORE IF THE BROKER IS CAUGHT NOT PAYING TO C-LOANS ITS CONTINGENT MARKETING FEE, THE PARTIES HEREBY AGREE THAT THE BROKER SHALL PAY LIQUIDATED DAMAGES TO C-LOANS EQUAL TO 37.5 BASIS POINTS ON A SUM EQUAL TO FIVE PERCENT (5%) OF THE TOTAL AMOUNT OF ALL OF THE LOAN REQUESTS ON ALL OF THE LEADS SOLD TO THE BROKER BY C-LOANS.
  10. Arbitration of Disputes: In the event that legal action, at law or in equity, becomes necessary to enforce the terms of this agreement, the parties hereby agree to arbitrate said dispute according to the Commercial Arbitration Rules of the American Arbitration Association. The sole and exclusive venue shall lie in Sacramento, California. The prevailing party shall be entitled to arbitration costs, arbitrator's fees, expert witness fees, but not attorney fees.
  11. Entire Agreement: This writing represents the entire agreement between the parties. Evidence of no other agreement, express or implied, oral or in writing, shall be admissible.
  12. Receipt of $250 Acknowledged: C-Loans hereby acknowledges receipt of a check in the amount of $250 from the Broker. In the event the Broker's application to buy leads from C-Loans is declined, C-Loans hereby agrees to refund this amount. In the event the application is approved, C-Loans agrees to give the Broker a credit of $250 towards the purchase of C-Loans leads. Any unused balance shall not be refundable.

AGREED AND ACCEPTED:

C-LOANS, INC.

___________________________________________ Date:________________

Tom Blackburne, General Manager

 

By signing below the Broker agrees that he is personally liable for the above obligations:

Signed: ___________________________________________ Date:________________

Insert full legal name of the individual who is the largest percentage owner of the commercial mortgage company wishing to buy leads from C-Loans: _______________________________________________________________________