Sales Agency Agreement

1. RECITALS 2. DURATION 3. AGENT’S BEST EFFORTS 4. NONDISCLOSURE OF PRINCIPAL’S AFFAIRS 5. ASSIGNMENT OF AGENT’S INVENTIONS 6. COMMISSIONS 7. SALES SUBJECT TO COMMISSIONS 8. WHEN COMMISSIONS ARE PAID 9. COMMISSIONS ON TRADE-INS 10. SALES THROUGH OTHER SALES CHANNELS 11. SALES IN OR FROM OTHER TERRITORIES 12. DISPUTES ON COMMISSIONS 13. LIMITATION ON COMMISSION CLAIMS 14. AGENT NOT TO SHARE COMMISSION 15. CONTENTS OF ORDERS 16. ACCEPTANCE OF ORDERS BY PRINCIPAL 17. AGENT NOT TO COMPETE 18. REPAIRS AND MAINTENANCE OF PRODUCT 19. COMPROMISE AND COLLECTION OF ACCOUNTS 20. REMITTALS BY AGENT 21. AGENT’S EXPENSES 22. ACCOUNTING ON TERMINATION 23. OBJECTIONS TO ACCOUNTING; LIMITATIONS 24. SURETY BOND OF AGENT 25. EXAMINATION OF AGENT’S ACCOUNTS 26. DISPOSITION OF PRODUCTS; CONSIGNMENT 27. INSURANCE PREMIUMS; TAXES 28. COMPLIANCE WITH LAWS 29. CUSTOMER LIST; SALES CALLS 30. DEPRECIATION OF AGENCY PROPERTY 31. PURCHASE OF AGENCY PROPERTY 32. EMPLOYMENT OF SUBAGENTS 33. MODIFICATION AND TERMINATION 34. GOVERNING LAW

A Sales Agency Agreement or Agency Agreement is an agreement between a Principal (entity requiring services) and an Agent who agrees to represent the Principal or its product(s). Such an agreement usually specifies that the Agent shall be paid in the form of commission for selling the Principal’s product, for acting on behalf of the Principal and/or for performing sales functions stipulated in the agreement. However, it is up to the two parties to determine the accepted method of remuneration as they may decide upon a fixed fee. Both the Principal and the Agent must agree to all the provisions written in an Agency Agreement. It is for this reason that one must carefully examine each element of the agreement and put forward any changes or additions before the agreement is signed.

In many such agreements, the Principal will include a “non-compete” clause which prohibits the Agent from entering into similar agreements with competitors for the duration of the contract or for a specified period following the contract’s termination.

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