Agency Agreement Template
Prepared for [COMPANY NAME]
Created by [AGENCY]
What is an agency agreement?
An agency agreement is a document that specifies the details of a working relationship between an agency that is hired to perform services such as marketing, web development or selling a product for a client.
This Agency Agreement is entered into as of [DATE] by and between [COMPANY NAME] having its principal place of business located at [ADDRESS] (the “Company”) and [AGENT NAME] having its principal place of business located at [ADDRESS] (the “Agent”), both of whom agree to be bound by this Agreement.
PandaTip: This Agency Agreement Template is designed to govern a situation where there is a company that offers products or services and wants to hire an agent to market and sell it on their behalf.
WHEREAS, the Company offers customers certain products, as described on the document attached hereto as Exhibit A (the “Products”); and
PandaTip: As written, this Agency Agreement Template is in the context of a company offering a product, but if you want to modify it to reflect a company that sells a service, then it can easily be modified by doing a quick find and replace, replacing “Products” with “Services.”
WHEREAS, the Company and the Agent desire to enter into an agreement whereby the Agent will market and sell the Product according to the terms and conditions herein.
NOW, THEREFORE, in consideration of the mutual covenants and promises made by the parties hereto, the Company and the Agent (individually, each a “Party” and collectively, the “Parties”) covenant and agree as follows:
ASSIGNMENT OF RIGHT. With certain limitations stated herein, the Company hereby authorizes the Agent the right to market and offer for sale the Products according to the terms and limitations stated in this Agency Agreement.
The Agent shall only market and offer for sale the products within the Territory, as defined in this Agreement.
The Company reserves the right to add to or subtract from the list of Products authorized on Exhibit A attached hereto with notice to the Agent.
PandaTip: This is the key clause in the Agency Agreement that gives the Company’s agent the right to market the products or services. 1(b) allows the Company some flexibility in amending the scope of the products or services it allows the Agent to offer on its behalf.
TERRITORY. The Agent shall be authorized to market the Product in [TERRITORY] (the “Territory”).
PandaTip: Here you can define the geographic area in which the Agent will be allowed to market and sell the product or service. The scope of the Territory may be as large or as restrictive as the Company deems appropriate. The next section is a very relevant consideration with regard to determining the relative expansiveness of the Territory.
EXCLUSIVITY. The Agent shall be the exclusive party authorized to market the Product within the Territory.
PandaTip: This section defines whether or not the Agent will be the sole party allowed to market the product or service within the territory. As written, it grants them such exclusivity. However, if you wanted to appoint multiple agents within a territory, you could swap in “Nothing in this Agreement grants the Agent the exclusive right to market the Products within the Territory.” Again, this is a relevant consideration to the previous paragraph – i.e., if the Territory is limited, the Company may want to give the Agent exclusivity.
TRADEMARK RIGHTS. The Agent agrees and acknowledges the following with regard to the Company’s trademark:
The Company is the sole and exclusive owner to all right, title and interest in “[COMPANY TRADEMARK]” or to any other trademarks associated with the Company (the “Company Trademarks”) which the Agent may utilize in performing the services herein.
The Company hereby grants to the Agent for the duration of this Agreement and subject to the limitations stated within this Agreement a non-exclusive, non-transferable, revocable right to use the Company Trademarks as necessary to market and offer for sale the Products within the Territory.
PandaTip: This section does two things: (1) reaffirm the Company’s rights in its trademark and (2) clearly spell out the permission the Agent has to use the Company Trademarks in order to promote the products or services.
AGENT RESPONSIBILITIES. In marketing and offering the Products for sale in the Territory, the Agent shall:
Act with diligence, devoting reasonable time and effort to fulfill the duties described herein;
Maintain reasonable technical and practical knowledge with regard to the Products;
Utilize promotional materials provided to the Agent by the Company for the purpose of marketing and selling the Products;
If requested by the Company, attend and participate in trade shows and conventions related to the Products;
Promptly respond to all communications by customers and the Company regarding the Products;
Reasonably assist the Company with regard to any and all collection matters as requested by the Company; and
Prepare and maintain any reports and documentation, as requested by the Company.
COMMISSION. The Company shall pay to the Agent [PERCENTAGE] of all Net Product Sales directly from the Agent’s efforts. “Net Product Sales” shall be defined as the amount of sales revenue from any sales made by the Agent less any chargebacks, returns, or defaults by customers.
Should the Parties terminate this Agreement for any reason, the Company shall pay the Agent only for sales of the Products made prior to the termination date.
In the event that the Agent receives commission payments for orders that are subsequently refunded, charged back, or the Company otherwise fails to realize the income from such a sale, the Agent shall offset any future commissions paid by the amount by which the commissions actually paid would be reduced if the sales associated with income the Company failed to realize were never completed.
Payments shall be made to the Agent on or before [TIME] for the [PERIOD].
PandaTip: With regard to 6(c), the text should reflect (a) when payments are made and (b) for what time period – e.g., “…on or before the 10th of each month for the calendar month prior to the date such payment is made.”
The Agent shall not disclose to any third party any details regarding the Company’s business, including, without limitation any information regarding any of the Company’s customer information, business plans, or price points (the “Confidential Information”), (ii) make copies of any Confidential Information or any content based on the concepts contained within the Confidential Information for personal use or for distribution unless requested to do so by the Company, or (iii) use Confidential Information other than solely for the benefit of the Company.
Immediately upon termination of the relationship between the Company and the Agent, the Agent shall return to the Company any documents pertaining to the Company’s business or any of its trade secrets which are in the Agent’s possession.
PandaTip: This section aims to prohibit the Agent from disclosing any sensitive information and also ensure that the Agent returns to the Company any proprietary documentation that may contain such information, such as customer lists and price points.
TERM AND TERMINATION.
This Agreement shall commence upon the date of execution and continue until either Party terminates this Agreement in writing.
Upon such termination, the Agent shall cease marketing and offering for sale the Products and shall continue to abide by the obligation refrain from sharing with any third party any of the Company’s confidential information.
INDEMNIFICATION. The Agent agrees to indemnify, defend, and protect the Company from and against all lawsuits and costs of every kind pertaining to any violation of the law, this Agreement, or the rights of any third party by the Agent while acting pursuant to this Agreement. Such costs include but are not limited to reasonable legal fees.
PandaTip: This section seeks to protect the Company from any harmful acts taken by the Agent while performing the duties under this Agency Agreement.
NO MODIFICATION UNLESS IN WRITING. No modification of this Agreement shall be valid unless in writing and agreed upon by both Parties.
APPLICABLE LAW. This Agreement and the interpretation of its terms shall be governed by and construed in accordance with the laws of the State of [STATE] and subject to the exclusive jurisdiction of the federal and state courts located in [COUNTY], [STATE].
IN WITNESS WHEREOF, each of the Parties has executed this Agreement, both Parties by its duly authorized officer, as of the day and year set forth below.