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Referral Agreement - Establish a Fair Plan for Referrals
A Referral Agreement is a contract that establishes how a business will compensate another for referring clients or leads. This is an essential document for a business because it sets clear expectations for both parties, defines the compensation structure, and ensures a transparent and legally compliant relationship. This agreement helps to build trust and provides a strong incentive for the referrer to generate quality leads.
Referral Services
This section defines the services the referrer will provide, such as introducing potential clients to the company. It specifies that a referred client must be a new customer and outlines the methods for making introductions, such as via email or through an online portal.
Compensation
The agreement clearly defines the compensation structure. It specifies the referral fee, which is often a percentage of the net revenue from the referred client, and the duration for which the fee will be paid. It also outlines how the fees will be calculated and when payments will be made, providing financial clarity and predictability.
Term and Termination
This section sets the duration of the agreement and the conditions under which it can be terminated. It also clarifies that even after termination, the referrer will continue to receive fees for clients they introduced before the agreement ended, which is a fair and important consideration.
Confidentiality
The agreement includes a confidentiality clause, obligating both parties to maintain the confidentiality of any non-public business information. This is a crucial protection for both the company's and the referrer's sensitive information.
Governing Law and Jurisdiction
This is a crucial section for any international agreement. It specifies which country's laws will govern the contract and which courts will have exclusive jurisdiction over any disputes. This provides a clear legal framework and a predictable path for conflict resolution.
Creating a Referral Agreement with Bind is the easiest way to formalize a referral relationship. Our tool guides you to create a comprehensive and legally sound document that protects your business. Once the agreement is ready, you can sign it electronically, making the entire process fast and secure.
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