Organic Compounds v. Watkins CA2/4

BACKGROUND

A. Relationships Between the Parties The Watkins are the shareholders, or trustees for the shareholders of Organic, and owners of the business property used by Organic. Freire is the president and/or principal of Strategic. In December 2005, Strategic entered into an “Acquisition Advisory Services Agreement” (the Services Agreement) with Organic and the Watkins. The Services Agreement was an exclusive agreement under which Strategic, a private investment banking advisory services provider, agreed to provide services to assist in the sale of Organic. Specifically, Strategic agreed to prepare documents and material necessary to inform prospective buyers of the opportunity, identify, contact, brief and introduce prospective buyers to Organic and assist Organic in the successful closure of a sales transaction. Organic agreed to pay Strategic an

2 installment fee for three months and a transaction fee on the closing date of any transaction. The Services Agreement included a “Limitation of Service” clause stating that the agreement “relates solely to Services described herein,” as well as an integration clause. It also had an arbitration clause requiring the parties to…