This document serves as the foundational agreement for establishing a formal sales representation relationship under German law. A Sales Representative Contract is essential when a company wishes to engage an independent sales agent to promote and sell its products or services in specific territories or to specific customer segments. The agreement must comply with the German Commercial Code (Handelsgesetzbuch - HGB), which provides specific protections for commercial agents and mandates certain contractual provisions. This document is particularly relevant for companies expanding their sales operations through indirect sales channels, requiring a clear framework for commission structures, territorial rights, performance expectations, and mutual obligations. It includes provisions for territory definition, commission calculations, reporting requirements, and termination terms, all aligned with German legal requirements.
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1. Parties: Identification of the principal company and the sales representative, including full legal names, addresses, and registration details
2. Background: Brief context of the agreement and the parties' intention to enter into a sales representation relationship
3. Definitions: Key terms used throughout the agreement, including 'Territory', 'Products', 'Customers', 'Commission', etc.
4. Appointment and Territory: Formal appointment of the representative and definition of the geographical area or market sector where they are authorized to operate
5. Rights and Obligations of the Sales Representative: Core duties including customer solicitation, market development, reporting, and compliance with company policies
6. Rights and Obligations of the Principal: Company's duties including product information, support, and training provisions
7. Commission Structure: Detailed explanation of commission rates, calculation methods, and payment terms as required by 搂搂87-87c HGB
8. Term and Termination: Duration of the agreement and termination provisions, including notice periods as per 搂89 HGB
9. Post-Termination Provisions: Handling of pending commissions, return of materials, and final settlements
10. Confidentiality: Protection of business secrets and confidential information
11. Governing Law and Jurisdiction: Specification of German law as governing law and competent courts
1. Non-Compete Clause: Restrictions on competitive activities during and after the contract term - optional but common for protecting business interests
2. Performance Targets: Specific sales targets or KPIs - include when the principal wants to set measurable performance standards
3. Training and Support: Detailed provisions for training and ongoing support - relevant for complex products or services
4. Insurance Requirements: Obligations regarding professional liability insurance - important for high-value products or regulated industries
5. Data Protection: Detailed GDPR compliance provisions - essential when handling significant customer data
6. Sub-agents: Rules regarding the appointment of sub-agents - include when sub-agents might be needed
7. Marketing and Advertising: Guidelines for marketing activities - relevant when the representative will conduct independent marketing
8. Inventory and Samples: Rules for handling product samples or inventory - include when physical products are involved
1. Schedule 1: Product List: Detailed list of products/services the representative is authorized to sell
2. Schedule 2: Commission Rates: Detailed commission structure including any variations by product or customer type
3. Schedule 3: Territory Description: Detailed description of geographical territory or customer segments
4. Schedule 4: Reporting Templates: Standard forms for activity reporting and commission calculations
5. Schedule 5: Company Policies: Relevant company policies the representative must comply with
6. Appendix A: Performance Metrics: Detailed KPIs and evaluation criteria if performance targets are included
7. Appendix B: Training Manual: Overview of required training and ongoing support procedures
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