Fiscal Sponsorship Agreement

FISCAL SPONSORSHIP AGREEMENT

This Fiscal Sponsorship Agreement (this “Agreement”) is entered into by and between The Museum of Human Achievement (“Sponsor”), and_______________, (the “Grantee”).  This Agreement shall be effective as set out below at Section 1.

RECITALS

1. Sponsor has an Internal Revenue Service (“IRS”) determination letter of qualification under Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the “Code”) and is classified as a public charity under Code Sections 509(a)(1) and 170(b)(1)(A)(vi).  Sponsor is organized and operated exclusively for charitable purposes within the meaning of Section 501(c)(3) of the Code;
2. The Grantee was formed as a ___________________, as defined in ________________ of the Texas Business Organizations Code (the “TBOC”), and does not have an IRS determination letter of qualification under Section 501(c)(3) of the Code.  The Grantee is organized and operated exclusively for charitable purposes within the meaning of Section 501(c)(3) of the Code;
3. In furtherance of its charitable purposes, the Grantee operates a program (the “Sponsored Program”) as described in the grant proposal (“Grant Proposal”) which has been approved by Sponsor’s Board of Directors and is attached hereto as Exhibit A;
4. The Grantee desires to have Sponsor act as its fiscal sponsor for the purpose of soliciting and receiving gifts, grants, contributions and other revenues (collectively, “donations”) and distributing such funds to the Grantee, subject to Sponsor’s oversight, to be used exclusively in support of the Sponsored Program;
5. Sponsor’s Board of Directors has determined that the Sponsored Program furthers Sponsor’s charitable and tax-exempt purposes.  Sponsor’s Board of Directors has authorized Sponsor to enter into a fiscal sponsorship agreement with the Grantee whereby Sponsor will receive donations on its own behalf and disburse such funds to the Grantee in support of the Sponsored Program, in accordance with the terms and conditions of this Agreement.

NOW, THEREFORE, the parties hereby agree as follows:

Effective Date

This Agreement shall become effective on _________, _____.

Fiscal Sponsorship

1. Sponsored Program Activities. The Grantee’s officers shall act as principal coordinators of the Sponsored Program.  Sponsor retains oversight authority to ensure that the funds disbursed by Sponsor to the Grantee in support of the Sponsored Program are used for their intended charitable purposes.
2. Receipt and Disbursement of Funds; Variance Power.  In connection with its sponsorship of the Grantee, Sponsor agrees to receive donations that are designated as made in support of the Sponsored Program (“Sponsored Program Funds”).  Sponsor anticipates granting Sponsored Program Funds to the Grantee, in furtherance of the Sponsored Program (less any administrative charge set out below).  Upon request by the Grantee, Sponsor will disburse Sponsored Program Funds to the Grantee, assuming sufficient funds are available; provided, however, that in order to receive further disbursements the Grantee must be in compliance with all of its obligations under this Agreement, including specifically the reporting requirements set forth in Section 5 hereto and the obligations of the Grantee set forth in Section 6 hereto, and further provided that the date and amount of each disbursement of Sponsored Program Funds shall be within the discretion and control of Sponsor.  The Grantee assumes the risk that any funding source may exercise its discretion not to grant or not to appropriate funds to Sponsor for the support of the Sponsored Program.  The parties intend that this Agreement be interpreted to provide Sponsor with variance powers necessary to enable Sponsor to treat the Sponsored Program Funds as Sponsor’s assets while this Agreement is in effect.  Sponsor, in its sole discretion, shall have the right to withhold, withdraw, or demand the immediate return of any Sponsored Program Funds if, in Sponsor’s reasonable judgment, the Grantee materially breaches this Agreement or cannot accomplish the purposes of the Sponsored Program.  Sponsor retains the right, in its sole discretion, to redirect the Sponsored Program Funds to a different charitable purpose or beneficiary if the purpose of the Sponsored Program becomes unnecessary, incapable of fulfillment, or inconsistent with the charitable needs of the community served by Sponsor.
3. Substantiation of Charitable Donations. Sponsor agrees that all Sponsored Program Funds will be reported for federal tax purposes as contributions to Sponsor and further agrees to acknowledge receipt of such Sponsored Program Funds in writing to donors, as required under federal tax law, and to furnish evidence of Sponsor’s status as an organization qualified under Section 501(c)(3) of the Code to donors on request.
4. Administrative Charge. Sponsor will retain an administrative charge to cover the costs associated with its management of the Sponsored Program Funds and other administrative expenses associated with this Agreement.  This administrative charge shall be: ____ of the gross amount of the Sponsored Program Funds received by Sponsor annually.

Review by Sponsor

Sponsor and its representatives shall be given full access to the books, records, and senior management and financial personnel of the Grantee with respect to the Sponsored Program as Sponsor may reasonably request.  Sponsor may, at its own expense, conduct an independent financial audit and/or program audit of the Grantee’s books and records in relation to the charitable activities for which Sponsor has disbursed Sponsored Program Funds.

Financial Accounting and Reporting

Sponsor and the Grantee will maintain books and financial records for the Sponsored Program in accordance with generally accepted accounting principles, shall retain records as long as required by law and shall make records available to auditors as required by law.  The Grantee will reflect the activities of the Sponsored Program, to the extent required, on its state and federal tax and information returns and financial reports.  The Grantee shall engage a certified accountant to undertake an annual audit of its financial reports. The Grantee must provide the Sponsor with a copy of the auditor’s report. All disbursements from the Sponsored Program Funds shall be made payable to the Grantee.

Grantee Reporting Requirements

1. Reports to Sponsor.  The Grantee shall submit full and complete quarterly reports to Sponsor on the progress of the Sponsored Program.  Such reports shall be due within thirty (30) days of the end of each calendar quarter, for so long as this Agreement remains in effect.  Such reports shall describe the Grantee’s use of the Sponsored Program Funds, compliance with the terms of all grants, and the progress made by the Grantee in accomplishing the purposes of the Sponsored Program.
2. Reports to Funding Sources.  The Grantee will provide all information and prepare all reports, including interim and final reports, required by Sponsor to satisfy any funding sources, subject to Sponsor’s final review and approval.

Representations and Covenants of the Grantee

1. Bylaws.  The Grantee hereby represents and warrants that the executed By-Laws of __________ attached to this Agreement as Exhibit B (the “Grantee Bylaws”) have been duly adopted by the Grantee and govern the operations of the Grantee. The Grantee shall provide Sponsor a copy of any amendments or amendments and restatements to the Grantee Bylaws within five business days of any such amendments or amendments and restatements.
2. Coordination Council and Authorized Signatory. The Grantee hereby further represents and warrants as follows and makes the following covenants:
   1. The Coordination Council of the Grantee, as described in the Grantee Bylaws, are the persons “authorized to manage the affairs of the [Grantee] or in the development of policy of the [Grantee]” for purposes of Section 252.001 of the TBOC;
   2. The Grantee has provided a list of the names of the individuals serving on the Coordination Council to Sponsor in writing as of the date of this Agreement and shall provide Sponsor written notice of any change in the individuals serving on the Coordination Council within five business days of any such change;
   3. The Coordination Council shall act as the governing body of the Grantee responsible for ensuring the Grantee complies with all duties and obligations of the Grantee under this Agreement and the Grantee has obtained all necessary approvals by the membership of the Grantee as of the date hereof authorizing the Coordination Council to act as the governing body of the Grantee for such purposes and authorizing the signatory hereto for the Grantee to execute this Agreement on the Grantee’s behalf. A copy of such authorizations (whether granted (x) in a written consent of the Grantee’s membership or (y) by the requisite vote of the Grantee’s membership at a duly held meeting with a quorum and reflected in membership meeting minutes of the Grantee) is attached hereto as Exhibit C.
      1. In the event that the membership of the Grantee revokes the authority of the Coordination Council to act as the governing body of the Grantee for purposes of ensuring the Grantee complies with all duties and obligations of the Grantee under this Agreement, the Grantee shall provide written notice of such revocation to Sponsor within five business days of such revocation.

Notices

All notices or reports under this Agreement shall be addressed as follows:

If to Sponsor: The Museum of Human Achievement 3600 Lyons Rd Austin, TX 78702

If to Grantee:

Such addresses may be changed by written notice or email notice given by such party to the other or by other form of notice agreed to by the parties.

Restrictions on Use of Sponsored Program Funds

1. Tax-Exempt Purposes. The Grantee shall use the funds it receives from Sponsor solely for purposes of the Sponsored Program and shall not use such funds in any way that will jeopardize the tax-exempt status of Sponsor.  The Grantee agrees to comply with any written request by Sponsor to cease activities that, in Sponsor’s reasonable judgment, might jeopardize the tax-exempt status of Sponsor, and further agrees that Sponsor’s obligation to make funds available to the Grantee is suspended in the event that it fails to comply with any such request.
2. Prohibited Activities. No portion of the Sponsored Program Funds shall be used in any attempt to influence legislation. If Grantee intends to influence legislation or otherwise conduct any activities that constitute “lobbying” (as such term is defined under the Internal Revenue Code, the Treasury Regulations, and applicable IRS guidance) with funds raised by Grantee independent of this fiscal sponsorship arrangement, Grantee shall hold such funds in a segregated account from the account in which Grantee holds any Sponsored Program Funds. No portion of the Sponsored Program Funds shall be used to participate or intervene in any political campaign on behalf of or in opposition to any candidate for public office, induce or encourage violations of law or public policy, cause private inurement or improper private benefit to occur, support terrorist activities, terrorist organizations or individuals who engage in or support terrorist activities, or take any other action inconsistent with qualification under Section 501(c)(3) of the Code.

Relationship of the Parties

Nothing in this Agreement shall constitute the naming of either party hereto as an agent or legal representative of the other party for any purpose whatsoever except as specifically and to the extent set forth herein.  This Agreement shall not be deemed to create any relationship of agency, employment, partnership, or joint venture between the parties hereto and the Grantee shall make no such representation to anyone.  It is the intention of the parties that all employees, contractors, and advisors for the Grantee will be employed or engaged directly by the Grantee and not by Sponsor.

Indemnification

The Grantee hereby irrevocably and unconditionally agrees, to the fullest extent permitted by law, to defend, indemnify, and hold harmless Sponsor, its officers, directors, trustees, employees and agents, from and against any and all claims, liabilities, losses and expenses (including reasonable attorneys’ fees) directly, indirectly, wholly or partially arising from or in connection with any act or omission of the Grantee, its employees or agents, in applying for, accepting, expending or applying Sponsored Program Funds, or in carrying out the Sponsored Program, except to the extent that such claims, liabilities, losses or expenses arise from or in connection with any negligent act or omission of Sponsor, its officers, directors, trustees, employees or agents.

Fundraising

The Grantee shall notify Sponsor (a) of all jurisdictions in which it would like Sponsor to solicit charitable contributions from the public in support of the Sponsored Program; and (b) if it intends to engage a commercial fundraiser to solicit charitable contributions from the public in support of the Sponsored Program.  All solicitations for the Sponsored Program shall be made in Sponsor’s name.  All solicitation materials that use the name of Sponsor or its affiliates, including both written solicitation materials and scripts for oral solicitation communications, shall be subject to Sponsor’s advance approval.  The Grantee shall comply with all laws and regulations concerning the solicitation of charitable contributions.  All original letters of inquiry and grant proposals that use the name of Sponsor or any of its affiliates shall be subject to Sponsor’s advance approval in its sole discretion and shall be signed by an authorized representative of Sponsor.  All grant agreements, pledges, or other commitments with funding sources to support the Sponsored Program shall be subject to Sponsor’s advance approval in its sole discretion and shall be executed by Sponsor.  The cost of any reports or other compliance measures required by such funding sources shall be borne by the Grantee.

Publicity

Any and all use of Sponsor’s name in media communications and fundraising materials with respect to the Sponsored Program shall be subject to Sponsor’s prior review and approval.  The Grantee shall provide Sponsor with reasonable advance notice with respect to any proposed use of Sponsor’s name in order to allow for such prior review.

Termination

This Agreement shall remain in effect until the earliest of the following:  

1. The Grantee receives a determination letter from the IRS of its qualification under Section 501(c)(3) of the Code;
2. Sponsor or the Grantee terminates this Agreement for Cause upon delivering a written notice of termination for Cause to the other party, which such notice shall set forth a description of the applicable material breach. In such case, the Agreement shall terminate within five business days of the delivery of the written notice of termination for Cause unless the breaching party cures the material breach set forth in the written notice of termination for Cause in a manner satisfactory to the non-breaching party, as determined in the reasonable discretion of the non-breaching party. For purposes of this Agreement, “Cause” shall mean a material breach by either party of any provision of this Agreement; or
3. Either party terminates this Agreement without Cause by giving thirty (30) days’ written notice to the other party.

Disposition of Sponsored Program Funds in Termination

If there are any Sponsored Program Funds remaining after this Agreement has terminated, the following terms and conditions shall apply, subject to Sponsor’s variance power set forth above at Section 2b:

1. If the Grantee has received a determination letter from the IRS of its qualification under Section 501(c)(3) of the Code, Sponsor shall transfer the balance of all Sponsored Program Funds, net of any liabilities incurred by Sponsor in connection with the Sponsored Program, to the Grantee for use in the Sponsored Program.
2. If the Grantee has entered into a written fiscal sponsorship agreement with another fiscal sponsor that has an IRS determination letter of qualification under Section 501(c)(3) of the Code, then Sponsor shall transfer the balance of any Sponsored Program Funds, net of any liabilities that Sponsor has incurred in connection with the Sponsored Program, to such new fiscal sponsor for use in the Sponsored Program.
3. In the event that the Grantee has not received an IRS determination letter from the IRS of qualification under Section 501(c)(3) of the Code or entered into a written fiscal sponsorship agreement with another fiscal sponsor that has an IRS determination letter of qualification under Section 501(c)(3) of the Code, Grantee may submit to Sponsor a Final Sponsored Program Request (“Final Request”) specifying how any remaining Sponsored Program Funds will be spent in furtherance of Grantee’s charitable purpose if allocated to Grantee. Upon receipt of Final Request, Sponsor may in Sponsor’s sole discretion allocate remaining Sponsored Program Funds to Grantee and in any manner consistent with applicable tax and charitable trust laws, provided, however, that in such case Grantee shall be required to enter into a final grant agreement with Sponsor which shall include reporting obligations and covenants consistent with the provisions of Sections 5 and 6 of this Agreement and such other conditions and requirements deemed reasonable and prudent in the Sponsor’s sole discretion.

Amendments to Grant Proposal and Sponsored Program

Without limiting any other provision of this Agreement regarding amendments hereto, the Grantee must submit any proposed amendment to Grant Proposal and the Sponsored Program to Sponsor for review by the Sponsor’s Board of Directors in writing. The Sponsor’s Board of Directors shall have thirty (30) days to review the proposed amendments and determine, in its sole discretion, whether to approve any such proposed amendments. If the Sponsor’s Board of Directors approves of the proposed amendments Exhibit A of this Agreement shall be amended to reflect the duly approved amended Grant Proposal and Sponsored Program. For the avoidance of doubt, Grantee shall refrain from raising any funds through Sponsor, as the fiscal sponsor, for any activities other than the Sponsored Program.

Miscellaneous Provisions

1. Amendments. This Agreement may not be amended or modified, except in a writing signed by both parties hereto.
2. Dispute Resolution. In the event of a dispute under this Agreement, Sponsor and the Grantee shall make a good faith effort to resolve such dispute cooperatively before seeking to resolve any dispute by arbitration or otherwise proceeding with any remedy available at law or in equity.
3. Choice of Forum. The parties agree that civil county courts located in Travis County, Texas are the mandatory, exclusive venue for actions relating to this Agreement.  The parties agree that Travis County is a convenient forum, and that all court proceedings shall be filed in Travis County and in no other forum.
4. Consent to Jurisdiction. For all purposes related to this Agreement, the parties hereby consent to personal jurisdiction in the civil county and state courts in and for the State of Texas.
5. Entire Agreement. This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof; it supersedes any prior agreement and understandings between the parties as to such matters, oral or written, all of which are hereby cancelled.
6. Governing Law. This Agreement shall be governed by and interpreted in accordance with the laws of the State of Texas without regard to any choice of law provisions.
7. Severability. Each provision of this Agreement shall be separately enforceable, and the invalidity of one provision shall not affect the validity or enforceability of any other provision.
8. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument.
9. Attorneys’ Fees. In the event of any controversy, claim, or dispute between the parties arising out of or related to this Agreement, or the alleged breach thereof, the prevailing party shall, in addition to any other relief, be entitled to recover its reasonable attorneys’ fees and costs of sustaining its position.

SIGNATURE PAGE TO FISCAL SPONSORSHIP AGREEMENT

Between The Museum of Human Achievement

And

____________________ __________________________________

IN WITNESS WHEREOF, the parties have caused their duly authorized representatives to execute this Agreement effective as of the day and year set out in Section 1 of this Agreement.

SPONSOR
The Museum of Human Achievement,
a Texas nonprofit corporation

By:
Name:
Its:
Date:

GRANTEE __________________, a ________________________
By:
Name:
Its:
Date:

EXHIBIT A

APPROVED GRANT PROPOSAL

EXHIBIT B

BY-LAWS OF THE GRANTEE

EXHIBIT C

AUTHORIZATIONS OF THE GRANTEE’S MEMBERSHIP