Commission, confidentiality and non-solicitation agreement

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There are three key aspects to this contract: one party agrees to pay commission to the other; one or both agree to keep information confidential; and one or both give non-solicitation undertakings.

Author: Alasdair Taylor
Updated: 19 January 2023
Length: 11 pages
Notes: 12 pages
Format: MS Word (.DOCX)

Our commission, confidentiality and non-solicitation agreement template can protect you from future disputes with your consultants regarding the payment of commission, the proper use of information exchanged during your business relationship and future business dealings with people implicated in your business relationship.

The commission, confidentiality and non-solicitation agreement template sets out the payment terms for the commission. These terms include a specified interest rate for late payments or the remuneration available under the Late Payment of Commercial Debts (Interest) Act 1998. The template also contains a dispute resolution clause in case the parties cannot agree on the amount of the commission. In the event of a dispute, the party that is owed the commission has a right to inspect the books of the other party. This inspection will be at the cost of the inspecting party unless the inspection reveals an underpayment, in which case the other party must cover the costs of the inspection.

To protect each party's business interests, the agreement contains reciprocal non-solicitation provisions. Each party agrees not to hire the other's employees, poach the other's clients, profit from the relationship to develop new ventures or frustrate the other party's business. The restrictions apply broadly: not just to employees and customers but also to other persons, such as parent or subsidiary companies, subcontractors or suppliers, with whom each party has important business relationships. With a view to ensuring the enforceability of these restrictions, each party explicitly acknowledges the reasonableness and necessity of the non-solicitation obligations. These restrictions can be made to apply for a specified period beyond the end of the contract.

Each party also submits to confidentiality obligations that require it not to disclose any confidential information it obtains from the other party. Confidential information may optionally include the terms and/or the fact of the existence of the agreement itself. The confidentiality restrictions may run for a specified period or indefinitely after the contract is terminated.

Each party explicitly rejects any transfer of intellectual property to the other party.

The parties have the option to include indemnity provisions requiring each to protect the other against losses or damages caused by a breach of the contract.

  1. Definitions
  2. Term
  3. Commission
  4. Interest
  5. Audit
  6. Non-solicitation: restrictions on First Party
  7. Non-solicitation: restrictions on Second Party
  8. First Party's confidentiality obligations
  9. First Party's publicity obligations
  10. Second Party's confidentiality obligations
  11. Second Party's publicity obligations
  12. Intellectual property rights
  13. Warranties
  14. Termination
  15. Effects of termination
  16. Notices
  17. General
  18. Interpretation

Do the non-solicitation clauses in this agreement cover only the contracting parties, or can they also cover related persons and entities?

You cannot use a contract to create direct obligations against third parties. However, an optional clause in the does provide for the parties to use reasonable endeavours (or all reasonable endeavours) to ensure that no related persons or entities do anything which would if done by a contracting party would be a breach of the agreement.

Do the limitations of liability include anything concerning loss of contracts or business opportunities?

Yes. Optional clauses cover loss of: profits, income, revenue, use, production, anticipated, business, contracts and commercial opportunities.

What is the effect of the indemnities included in this agreement?

These provide for damages upon breach of contract to be calculated on the (more generous) indemnity basis. They may cover any breach of contract, or only breaches of particular terms (e.g. the confidentiality obligations).

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