Commission Agreement

Commission Agreement-Legaliser

This commission agreement defines the collaboration between a Principal and an Agent, detailing the sale of products, payment of commissions, and dispute resolution.

THIS AGREEMENT is made on [Insert Date]


  • [Principal’s Name], a company incorporated and registered in [Principal’s Country of Incorporation] with company number [Principal’s Company Number] and having its registered office at [Principal’s Registered Address] (the “Principal”),


  • [Agent’s Name], an individual with ID number [Agent’s ID Number] and residing at [Agent’s Address] (the “Agent”).


The Principal engages in the business of [Description of Principal’s Business], and the Agent has contacts within the industry and the ability to promote and sell the Principal’s products or services.

The Agent wishes to act, and the Principal wishes to appoint the Agent, as a sales agent for the purposes of [describe the scope of products/services to be sold].

NOW, THEREFORE, the parties agree as follows:


  1. The Principal shall provide the Agent with a definitive list of products and services eligible for sale under this Agreement. The Principal reserves the right to amend this list with [number] days’ written notice to the Agent.
  2. The Principal will set and may adjust the prices for the products and services, providing the Agent with [number] days’ written notice of any price changes.
  3. The Principal shall supply the Agent with all necessary promotional materials for the products and services. Should the Agent wish to use their own promotional materials, such must be submitted to the Principal for written approval prior to use.
  4. All sales must be conducted in accordance with the terms of the Sales Agreement template provided by the Principal, and any deviation from this template must be expressly approved in writing by the Principal.


  1. This Agreement shall commence on the Effective Date and, unless terminated earlier in accordance with the “Termination” clause herein, shall continue in full force and effect for a period of [specified time period] from the Effective Date.
  2. Upon the expiry of the initial term, this Agreement shall automatically renew for successive [specify renewal term lengths] periods unless either Party gives written notice of non-renewal at least [number] days prior to the end of the then-current term.
  3. The Parties may agree to a written amendment to extend or modify the duration of this Agreement, subject to the terms and conditions herein.
  4. Any changes to the duration of this Agreement must be made in writing and signed by both Parties, indicating their mutual consent to such changes.
  5. Notwithstanding the aforementioned renewal terms, both Parties retain the right to terminate the Agreement in accordance with the “Termination” clause provided herein.
  6. If either Party is in breach of the Agreement and the breach is not remedied within the notice period provided after written notice of the breach, the non-breaching Party shall have the right to terminate the Agreement immediately upon expiry of the notice period without prejudice to any other rights it may have.
  7. The expiry or termination of this Agreement for any reason shall not release either Party from any obligation which at the time of such expiry or termination has already accrued, nor affect in any way the survival of any right, duty, or obligation which is expressly stated elsewhere in this Agreement to survive such expiry or termination.


  1. The Agent shall exclusively sell the product(s) within the following geographical area(s): [Specifically defined territory]. For the avoidance of doubt, the defined territory excludes any sales conducted outside the specified boundaries.
  2. This Agreement grants non-exclusive rights to the Agent within the defined territory. The Principal may appoint other agents or sell directly within the same territory.
  3. Either party may request a revision of the defined territory to accommodate changing market conditions, strategic realignments, or opportunities that arise. Any such revisions must be mutually agreed upon in writing and appended to this Agreement as an amendment.
  4. In consideration of online sales, the Agent is authorized to engage with leads and clients whose registered address is within the defined territory. All digital marketing efforts shall be geographically targeted to the defined territory. Any sale resulting from a lead whose registered address falls outside the defined territory shall not be eligible for commission, unless otherwise agreed in writing.
  5. The Agent agrees to maintain accurate records of sales activities and shall report such activities to the Principal on a [INTERVAL] basis. The Agent shall use reasonable efforts to ensure that sales efforts are confined to the defined territory.
  6. In the event of a breach of this clause, the Agent shall be required to provide a detailed report of the breach. The Principal reserves the right to take corrective action, which may include a modification of the Agent’s territory, reduction in commission rates, or termination of the Agreement as outlined in the “Termination” clause.


  1. The Agent shall earn a commission of [insert percentage]% of the net income received by the Supplier from sales to clients introduced by the Agent. “Net income” is defined as the amount received by the Supplier from the client, less any taxes, refunds, allowances, and discounts.
  2. Commission payments shall be calculated monthly and paid to the Agent within [insert number] days of the end of each calendar month during which the income was received by the Supplier.
  3. In the event of a product return or contract cancellation, any commission paid to the Agent for that sale will be adjusted or refunded to the Supplier in the next payment cycle following the return or cancellation.
  4. The Agent’s commission earnings shall not be subject to any caps unless specified as an addendum to this Agreement. If thresholds must be met for commission earnings, such thresholds will be clearly defined and agreed upon in writing by both parties.


Each Party represents and warrants to the other that:

  • It has the full power and authority to enter into this Agreement and to perform its obligations hereunder without violating the rights of any third party or any applicable law, regulation, or order.
  • All corporate, organizational, or other consents and approvals have been obtained and are in effect to enter into and perform this Agreement.
  • There are no outstanding agreements, obligations, restrictions, or commitments that conflict with this Agreement or will limit the performance of its obligations under this Agreement.
  • They will immediately disclose any potential conflicts of interest or any factors that may affect their capability to fulfill their obligations under this Agreement.
  • They will not make any warranties or representations about the goods and services covered by this Agreement other than those explicitly authorized by the Principal.

  • The indemnification provisions herein shall serve to indemnify and hold harmless the other Party against any damages or claims arising out of breach of these representations and warranties.


  1. The Agent is an independent contractor and is not an employee, partner, or co-venturer with the Supplier. The Agent is solely responsible for all tax liabilities and insurance related to earnings received under this Agreement.
  2. The Agent agrees to indemnify and hold the Supplier harmless from any claims, damages, or expenses arising from the Agent’s actions that are not expressly authorized by this Agreement.
  3. The Agent is not an exclusive representative of the Supplier. The Agent may represent, promote, and sell products or services of other companies, provided that such products or services are not directly competitive with those offered by the Supplier as outlined in Exhibit A of this Agreement. If exclusivity is required, it will be defined in a separate Exclusivity Agreement between the parties.


  1. Both parties acknowledge that during the course of this Agreement, each may come into possession of confidential and proprietary information belonging to the other party (“Confidential Information”). Each party agrees to maintain the confidentiality of such information and to use it only for the purposes necessary to fulfill their obligations under this Agreement.
  2. Within [number] days of the Effective Date of this Agreement, the parties shall execute a separate Non-Disclosure Agreement (NDA) to ensure the protection of Confidential Information. The terms of the NDA will further define the confidentiality obligations and will form an integral part of the protection of each party’s proprietary information.
  3. The obligation of confidentiality shall survive the termination or expiration of this Agreement for a period of [number] years.


  1. This Agreement may be terminated by either Party by providing [number] days’ written notice to the other Party. Upon such notice, both Parties shall settle any outstanding transactions and commissions within [number] days of the termination date.
  2. Either Party may terminate this Agreement with immediate effect if the other Party commits a material breach of any term of this Agreement that is not remediable or if remediable is not remedied within [number] days after the receipt of a written request to remedy the same.
  3. The Principal may terminate this Agreement without notice if the Agent is found to be in violation of the non-compete or confidentiality terms of this Agreement, or if the Agent becomes insolvent, declares bankruptcy, or ceases operation.
  4. Upon termination for any reason, the Agent must promptly return to the Principal all samples, technical pamphlets, price lists, literature, and other materials pertaining to the business of the Principal.
  5. Termination of this Agreement shall not affect the continuation of any provision expressly stated to survive or implicitly surviving termination, including but not limited to confidentiality, dispute resolution, and applicable indemnification obligations.
  6. Upon termination, the Agent shall discontinue all use of the Principal’s trademarks, trade names, and other proprietary marks.
  7. The Principal reserves the right to withhold any unpaid commissions or other payments due to the Agent if the Agent has failed to comply with any provisions of this Agreement until the matter is resolved.
  8. Any sections of this Agreement that are intended to survive termination (including but not limited to confidentiality, indemnification, and limitation of liability clauses) will remain in effect following termination.


Each party shall indemnify the other against any claims arising from the breach of this Agreement or the negligence or willful misconduct of the indemnifying party.


  1. The parties acknowledge that a breach of certain obligations under this Agreement may cause irreparable harm and significant injury to the non-breaching party, which may be quantitatively difficult to ascertain. Accordingly, the parties agree that, in the event of any breach or threatened breach of the following sections: [specific sections or obligations], the breaching party shall pay to the non-breaching party an agreed-upon amount as liquidated damages, and not as a penalty.
  2. The parties agree that the sum of $[amount] is a reasonable estimate of the non-breaching party’s damages and shall be paid within [number] days of a written demand from the non-breaching party.
  3. The payment of liquidated damages is intended not as a penalty, but as full compensation for the non-breaching party’s loss. This sum shall be in addition to, and not in lieu of, any rights to equitable relief to which the non-breaching party may be entitled under this Agreement or in law, and any actual damages, loss, or injury sustained by the non-breaching party.
  4. The liquidated damages are separate and apart from any other remedies or damages available to the non-breaching party under this Agreement or under applicable law. The breaching party’s liability for liquidated damages shall not limit the non-breaching party’s right to any other remedies, including actual damages, and shall not be construed to limit the non-breaching party’s right to demand specific performance or injunctive relief.


  1. “Force Majeure Event” refers to any event or circumstance that prevents a party from performing its obligations under this Agreement, which is beyond the reasonable control of the affected party, including but not limited to acts of God, war, terrorism, riots, embargoes, acts of civil or military authorities, fire, floods, accidents, strikes, or shortages of transportation facilities, fuel, energy, labor or materials.
  2. If either party is prevented from performing any of its obligations under this Agreement due to a Force Majeure Event, the affected party shall promptly notify the other party in writing, providing details of the Force Majeure Event and any anticipated delay in performance.
  3. The affected party’s performance under this Agreement shall be suspended for the duration of the delay caused by the Force Majeure Event and will require no penalty or liability for such delay. The affected party shall use reasonable efforts to mitigate the effects of the Force Majeure Event and to resume performance of its obligations as soon as reasonably possible.
  4. If the Force Majeure Event continues for a period exceeding [number] days, either party may terminate this Agreement without penalty upon written notice to the other party. Upon such termination, the parties shall be relieved of their obligations under this Agreement, except for those obligations that by their nature are intended to survive termination.
  5. The parties shall meet to discuss good faith solutions if the Force Majeure Event significantly affects the commercial basis of this Agreement.
  6. Notwithstanding the occurrence of a Force Majeure Event, the obligations of the parties to make any payments due under this Agreement shall not be suspended.


  1. Neither Party may assign or transfer any of its rights or delegate any of its obligations under this Agreement, in whole or in part, without the prior written consent of the other Party, which consent shall not be unreasonably withheld or delayed.
  2. Any attempted assignment or delegation in violation of this provision shall be null and void.
  3. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns.
  4. In the event of an assignment, the assigning Party must ensure that the assignee agrees to comply with all terms and conditions of this Agreement and that the assignee possesses the capability and resources to fulfill the obligations hereunder.
  5. The assigning Party shall provide the non-assigning Party with all relevant information about the assignee to assess compliance with the standards set forth in this Agreement.


This Agreement may be amended, modified, or supplemented only by written agreement of the parties. No amendment, modification, or supplement to any provision of this Agreement shall be effective unless it is in writing and signed by both parties. The parties further agree that any such written amendment, modification, or supplement duly executed by both parties shall be binding upon them and shall have the same legal effect as this Agreement.


If any term or provision of this Agreement is found by a court of competent jurisdiction to be invalid, illegal, or unenforceable, such invalidity, illegality, or unenforceability shall not affect any other term or provision of this Agreement. The parties agree to negotiate in good faith to replace any invalid, illegal, or unenforceable provision with a valid provision that most closely approximates the intent and economic effect of the invalid, illegal, or unenforceable provision.


All notices, requests, demands, and other communications under this Agreement shall be in writing and shall be deemed to have been duly given on the date of service if served personally on the party to whom notice is to be given, or on the third day after mailing if mailed to the party to whom notice is to be given, by first-class mail, registered or certified, postage prepaid, and properly addressed to the party at the address set forth in this Agreement or such other address as the party may designate in writing from time to time. If notice is given by email, such notice shall be deemed to have been given when the recipient, by an email sent to the email address for that party as specified in this Agreement or as subsequently modified by written notice, acknowledges having received that email, with an automatic “read receipt” not constituting acknowledgment of an email for purposes of this clause.


This Agreement shall be governed by and construed in accordance with the laws of [Governing Law Country], and any disputes shall be resolved through arbitration in accordance with Annex F.


This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements and understandings, both written and oral, relating to its subject matter.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.












In the event of any dispute arising out of or in connection with this Agreement, the parties agree to the following arbitration process:

1. Notice of Arbitration: A party wishing to initiate arbitration must provide written notice to the other party, outlining the details of the dispute.

2. Appointment of Arbitrator: The parties will agree to appoint a single arbitrator. If the parties cannot agree on an arbitrator within [time period], an arbitrator will be appointed by [nominating body].

3. Arbitration Proceedings: The arbitration will be conducted in [City, Country] and will be governed by the [specified arbitration rules], as amended from time to time.

4. Decision: The decision of the arbitrator will be final and binding on both parties.

5. Costs: Each party will bear its own costs in the arbitration, and the costs of the arbitrator will be shared equally between the parties, unless the arbitrator decides otherwise.