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Agency Agreement

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Short Form of Non-Exclusive Sales Agency Agreement

Sales Agency Agreement made the day of , 20 ,

between , a corporation organized and existing under

the laws of , with its principal office located at

, referred to herein the Principal, and

, of

referred to herein the Agent.

Whereas, the Principal is the owner and operator of a business known as

, which is engaged in the business of

; and

Whereas, the Principal desires to employ the Agent for, and the Agent is willing to act for the Principal in, selling

, hereinafter called the Product;

Now, therefore, for and in consideration of the mutual covenants contained in this Agreement, and other good and valuable consideration, the parties agree as follows:

1. Principal shall employ Agent as its non-exclusive agent to solicit orders for the sale of the Product, at the prices and on such other terms and conditions established by the Principal, in the following geographic area:

2. Agent accepts such appointment and agrees to devote his best efforts to solicit orders but shall have no authority, right or power to accept any order, or to assume or create any obligation on behalf of the Principal.

3. Agent shall not engage in the selling of the Product for any competitor of Principal.

4. In full compensation of the services of Agent, Principal shall pay the Agent % of the sales price of all sales of the Product by Agent during the term of this Agency. The commission shall be paid monthly on or before the 15th day of each month beginning on the .

5. This Agreement shall commence on , and terminate on , unless earlier terminated by the Principal for just cause or by the mutual agreement of the Principal and Agent.

6. The invalidity of any portion of this Agreement will not and shall not be deemed to affect the validity of any other provision. If any provision of this Agreement is held to be invalid, the parties agree that the remaining provisions shall be deemed to be in full force and effect as if they had been executed by both parties subsequent to the expungement of the invalid provision.

7. The failure of either party to this Agreement to insist upon the performance of any of the terms and conditions of this Agreement, or the waiver of any breach of any of the terms and conditions of this Agreement, shall not be construed as subsequently waiving any such terms and conditions, but the same shall continue and remain in full force and effect as if no such forbearance or waiver had occurred.

8. This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of .

9. Unless provided herein to the contrary, any notice provided for or concerning this Agreement shall be in writing and shall be deemed sufficiently given when sent by certified or registered mail if sent to the respective address of each party as set forth at the beginning of this Agreement.

10. Notwithstanding the foregoing, and anything herein to the contrary, any dispute under this Agreement shall be required to be resolved by binding arbitration of the parties hereto. If the parties cannot agree on an arbitrator, each party shall select one arbitrator and both arbitrators shall then select a third. The third arbitrator so selected shall arbitrate said dispute. The arbitration shall be governed by the rules of the American Arbitration Association then in force and effect.

11. This Agreement shall constitute the entire agreement between the parties and any prior understanding or representation of any kind preceding the date of this Agreement shall not be binding upon either party except to the extent incorporated in this Agreement.

12. Any modification of this Agreement or additional obligation assumed by either party in connection with this Agreement shall be binding only if placed in writing and signed by each party or an authorized representative of each party.

13. The rights of each party under this Agreement are personal to that party and may not be assigned or transferred to any other person, firm, corporation, or other entity without the prior, express, and written consent of the other party.

14. Principal and Agent both acknowledge that all information and materials furnished from the Principal concerning this Agreement and the performance of it is confidential and may not be used for any purpose other than in connection with this Agreement.

15. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all of which together shall constitute but one and the same instrument.

16. In performing under this Agreement, all applicable governmental laws, regulations, orders, and other rules of duly-constituted authority will be followed and complied with in all respects by both parties.

WITNESS our signatures as of the day and date first above stated.

By:

By:

Enter text✕

What an Agency Agreement Is and When It Applies

An Agency Agreement is a written contract that authorizes one party (the agent) to act on behalf of another party (the principal) for defined tasks, transactions, or decisions. Typical uses include representation, contracting, sales authorization, and administrative tasks. The agreement describes the scope of authority, any limits on delegated powers, compensation or fees, effective and termination dates, and dispute resolution provisions. Properly drafted, it clarifies roles and reduces later disputes by documenting consent, duties, recordkeeping, and signature authority for both parties.

Why a Clear Agency Agreement Matters

A clear Agency Agreement reduces legal ambiguity about who can bind the principal, sets limits on authority, and creates a written basis for enforcement and record retention.

Why a Clear Agency Agreement Matters

Who Commonly Prepares and Signs Agency Agreements

Organizations and individuals use agency agreements when delegating authority for transactions, representation, or administrative actions.

  • Real estate brokers, property managers, and landlords who appoint agents to execute leases or manage transactions.
  • Healthcare administrators and billing managers who delegate administrative or insurance‑related tasks under HIPAA controls.
  • Corporate officers and procurement teams who authorize agents for contract negotiations or vendor management.

Choose signers and witnesses based on corporate bylaws, internal delegations, and any state-specific notarization or witness laws.

Who Can Sign: Typical Authorized Roles

Principal — CEO

The company principal or CEO typically signs to delegate authority. The narrative should confirm corporate capacity, cite board approval if required, and state limits on delegated authority in one to two sentences with clarity about contractual obligations.

Agent — Contract Manager

The named agent (for example, a contract manager or outside representative) should be identified with title and authority scope. Include duties, any sub‑delegation limits, and contact information so attribution and accountability are clear.

Core Elements to Include in a Professional Agency Agreement

A professionally drafted Agency Agreement contains several standard clauses that define parties, scope, authority limits, term, compensation, and procedures for termination or dispute resolution.

Parties

Identify principal and agent by full legal name, entity type, and a mailing address; use the exact registered name for corporations and LLCs.

Scope of Authority

Describe specific tasks or transaction types the agent may perform, including explicit exclusions and whether authority is exclusive or non‑exclusive.

Authority Limits

Set monetary caps, approval requirements, or conditions for certain transactions; reference required corporate approvals or internal delegations.

Term and Effective Date

State the effective date and whether the agreement auto‑renews, terminates on a date, or continues until revoked, including notice requirements for termination.

Compensation

Specify fees, commission calculations, invoicing frequency, reimbursement of expenses, and any withholding or tax responsibilities.

Termination and Remedies

Include termination for cause, cure periods, indemnification clauses, and the governing law and venue for disputes.

Step-by-Step: Complete an Agency Agreement

Follow these steps to prepare, authorize, and finalize the agreement so it is clear, enforceable, and properly executed.

  • 01
    Draft Terms: Define parties, scope, limits, compensation, term, and termination.
  • 02
    Confirm Authority: Verify signatory has corporate authority or express grant to sign.
  • 03
    Add Authentication: Decide if notarization or witness needed and include space.
  • 04
    Execute and Distribute: Collect signatures, provide copies, and record retention details.

Typical Processing Flow for an Agency Agreement

An efficient workflow reduces delay and ensures all parties receive executed copies and the required authentication, if any.

  • Prepare Document: Populate fields, attach exhibits, and review internal approvals.
  • Authorize Signers: Confirm who will sign and their capacity to bind the principal.
  • Authenticate: Apply notarization, witnesses, or enhanced eSignature authentication as required.
  • File and Store: Distribute executed copies and retain records per policy.

Configure a Digital Signing Workflow

Set up a consistent digital workflow to route the agreement, require authentication, and capture an audit trail for each signer.

Field Configuration
Signer Order Sequential or parallel routing as required
Authentication Level Email, SMS code, or knowledge‑based verification
Required Fields Signature, date, initials, and ID number fields
Audit Trail Enable timestamps, IP, and event logging

Digital Signing and File Format Considerations

Choose a platform that supports PDF and DOCX, provides an audit trail, and meets required authentication and compliance standards.

  • Supported Formats: PDF and Word DOCX are standard
  • Integrations: Salesforce, NetSuite, Microsoft 365 common
  • Authentication: Email, SMS, or advanced signer verification

Key Dates and Deadlines to Track

Track effective dates, renewal notice windows, and any statutory deadlines connected to the agreement to avoid lapses or penalties.

Effective Date:

Date obligations and authority begin

Notice Period:

Time required to terminate per clause

Renewal Deadline:

When automatic renewal can be stopped

Filing Cutoffs:

Deadlines for any regulatory filings

Record Retention:

Retention start date for archives

Typical Execution Milestones for an Agency Agreement

Plan milestones from initial draft to final storage so stakeholders know expected timing and responsibilities.

01

Draft and Internal Review

Legal and business teams review terms and propose edits.

02

Authorization and Approval

Obtain board or recorded delegation if required by bylaws.

03

Execution and Authentication

Collect signatures, witnesses, or notarization if applicable.

04

Distribution and Archival

Send executed copies to parties and save master file.

Common Mistakes to Avoid When Preparing an Agency Agreement

  • Using vague scope language that fails to limit agent power and invites overreach or disputes.
  • Failing to confirm signer authority or board approval, which can render actions ultra vires and unenforceable.
  • Omitting explicit termination or notice clauses, creating uncertainty about when agency ends.
  • Neglecting to require returns or accounting by the agent, increasing risk of misappropriation or audit issues.

Key Risks and Potential Consequences of Errors

Contract Void Risk: Misexecution can void actions
Liability Exposure: Principal may face third‑party claims
Tax Consequences: Incorrect reporting or withholding
Regulatory Fines: Noncompliance with industry rules
Notarization Invalidity: Missing formalities can impair recordation
Reputational Harm: Unclear authority damages trust

How an Agency Agreement Differs from Similar Documents

Compare core distinctions between an Agency Agreement and related instruments to select the correct document type for your situation.

Criteria Agency Agreement Power of Attorney Employment Agreement
Primary Purpose delegate authority grant durable legal power define employment terms
Typical Notarization optional often required rare
Duration contractual term potentially durable employment term
Revocability contract terms varies by statute depends on contract

eSignature Vendor Comparison for Signing an Agency Agreement

Basic vendor pricing and capability snapshot to evaluate eSignature options for routing and executing Agency Agreements; signNow is listed first per platform data.

signNow DocuSign Adobe Sign PandaDoc HelloSign
Starting Price $8/user/mo $15/user/mo $14/user/mo $19/user/mo $15/user/mo
Free Trial 7-day free trial Varies Varies Free trial available Free trial available
Bulk Send Yes (Premium) Yes Yes Yes Varies
Audit Trail Yes Yes Yes Yes Yes
HIPAA Compliant Yes Yes Yes No No

Frequently Asked Questions About Agency Agreements

Practical answers to frequent execution and compliance questions, including electronic signing, notarization, and dispute prevention.


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