1. Parties
This Commission Agreement (the "Agreement") is made on [DATE] between [COMPANY NAME], of [COMPANY ADDRESS] (the "Company"), and [SALESPERSON NAME], of [SALESPERSON ADDRESS] (the "Salesperson"). The Salesperson is engaged as [AN EMPLOYEE OF THE COMPANY / AN INDEPENDENT CONTRACTOR].
2. Products and Territory
The Salesperson will sell the Company's [PRODUCTS / SERVICES] (the "Products") to customers in [TERRITORY OR ACCOUNT LIST] (the "Territory"). The Territory is [EXCLUSIVE / NON-EXCLUSIVE]. House accounts excluded from commission: [LIST, or NONE].
3. Commission Rate
The Company will pay the Salesperson a commission of [PERCENTAGE]% of the Net Revenue from each Eligible Sale. [OPTIONAL TIERS: PERCENTAGE% on Net Revenue above AMOUNT per QUARTER.] "Net Revenue" means the amount actually paid by the customer, excluding taxes, shipping, refunds, credits, and chargebacks. An "Eligible Sale" is a sale of Products in the Territory that the Salesperson procured and that is accepted by the Company.
4. When Commission Is Earned
A commission is earned when the Company receives the customer's payment for an Eligible Sale. For sales paid in installments, commission is earned on each payment as it is received.
5. Payment of Commission
Earned commissions are paid [MONTHLY], on or before the [DAY] of the following month, together with a statement showing each sale, the Net Revenue, and the commission. [If the Salesperson is an employee: Commissions are paid through payroll, subject to withholding, and in addition to any base salary of AMOUNT.] [OPTIONAL: A recoverable draw of AMOUNT per month will be credited against earned commissions.]
6. Refunds and Clawbacks
If a customer receives a refund, credit, or chargeback within [NUMBER] days after payment, the related commission will be deducted from future commissions, to the extent permitted by law. The Company will show any deduction on the commission statement.
7. Expenses
The Company will [REIMBURSE REASONABLE, PRE-APPROVED BUSINESS EXPENSES / NOT REIMBURSE EXPENSES, WHICH ARE THE SALESPERSON'S RESPONSIBILITY].
8. Termination
[If employee: The Salesperson's employment is at will unless otherwise agreed in writing.] Either Party may end this Agreement with [NUMBER] days' written notice. After termination, the Company will pay commissions on Eligible Sales that were [ACCEPTED BEFORE THE TERMINATION DATE / CLOSED WITHIN NUMBER DAYS AFTER THE TERMINATION DATE], when the customer's payment is received, and within the time required by applicable law.
9. Changes to the Plan
The Company may change the commission rate, Territory, or Products for future periods with at least [NUMBER] days' written notice. Changes do not reduce commissions already earned.
10. Confidentiality and Conduct
The Salesperson will keep customer lists, pricing, and other non-public information confidential, will represent the Products accurately, and will not offer discounts or terms beyond those the Company authorizes.
11. General Terms
This Agreement is governed by the laws of [GOVERNING LAW JURISDICTION]. Where applicable law gives the Salesperson greater rights (for example, on the timing of final commission payments), that law applies. This is the entire agreement about commissions and may be changed only in writing, except as set out in section 9. The Parties agree that this Agreement may be signed electronically and in counterparts, each of which is an original and all of which together form one agreement.
12. Signatures
COMPANY: [COMPANY NAME] Signature: ____________________ Name and title: [SIGNATORY NAME, TITLE] Date: [DATE] SALESPERSON: [SALESPERSON NAME] Signature: ____________________ Date: [DATE]