Sales Agency Agreement (Compensation on Termination)

This Sales Agency Agreement (Compensation on Termination) is designed for use in situations whereby a business opts to use a commercial agent to sell its products.

This document is written in compliance with the Commercial Agents (Council Directive) Regulations 1993.

The data protection provisions in this document have been updated with reference to the UK GDPR.

This template contains detail clearly spelling out the obligations of, and the restrictions on, the agent and the principal. 

The agent can, under this agreement, be appointed as either a sole, exclusive or non-exclusive agent. Options allow you to choose whether the principal will be entitled to make direct sales without the agent’s involvement.

Products to be sold and commission rates and structures should be clearly defined in the schedules provided. A further optional provision and counterpart schedule allow for the imposition of sales targets.

This template expressly provides for compensation upon the termination of the agreement (that is, the default position under the Commercial Agents Regulations 1993). An alternative agreement is available which provides for an indemnity on termination. For more information on compensation and/or indemnity, please refer to Regulations 17 and 18 of the Commercial Agents Regulations 1993.

The term and termination clause can also be used to cater for the conversion of the agency agreement from one of a fixed term to one of indefinite duration (in the event that the parties simply continue performing after the expiry of the original agreement). Appropriate termination notice periods have also been built in.

This template is only suitable for use where both parties are based and operate in the UK, and delivery of products is only in the UK.

Optional phrases / clauses are enclosed in square brackets. These should be read carefully and selected so as to be compatible with one another. Unused options should be removed from the document.

This Sales Agency Agreement (Compensation to Termination) contains the following clauses:

1. Definitions and Interpretation
2. Appointment of Agent
3. Agent's Obligations and Method of Sale
4. Intellectual Property
5. Principal’s Obligations
6. Financial Provisions
7. Confidentiality
8. Force Majeure
9. Term and Termination
10. Post-Termination Compensation
11. Exclusion of Compensation
12. Data Protection
13. Data Processing
14. Relationship of the Parties
15. Nature of the Agreement
16. Severance
17. Notices
18. Law and Jurisdiction

and the following Schedules:

1. Products
2. Commission
3. [Agent’s Sales Targets]
4. Each Party's Privacy Notice

This document is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.

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