Free Commission Agreements - Merchant Services: Sales Rep

Sample Merchant Services Sales Rep Compensation Agreement Template  

Merchant Services Compensation Agreement  Revision Date: __________________________________    

This document is designed for a Merchant Services Sales Rep. It includes New Sales MRM Commissions, Equipment Incentives, Residual Commissions and other terms and conditions    

This document describes the agreement between [ii]________________________________ (“Company”) and [iii]____________________________________ (“Payee”) regarding terms related to compensation.    

Company and Sales Rep enter into this agreement whereby Sales Rep provides Merchant services to the Company and customers of company, in return for compensation specified in this agreement.    

Duration:  
This agreement covers the period starting from [iv]_______________ and ends on ________________.  

All commissions will be calculated and paid once every month, for the preceding month. Commissions will be calculated and paid out as part of the next payroll cycle, following the month for which commissions are calculated.    

Territory:  
Sales Rep gets direct credit for all sales sold by Sales Rep or sub sales reps.    

Base Pay:    
Sales Rep's base salary (if any) is specified as part of a separate agreement.    

Sales Compensation:  
Targeted sales compensation for the full year is  ________. The sales compensation is not capped.    

Other Compensation:    
Sales Rep will be paid for all travel and lodging expenses related to sales activities. Auto travel will be reimbursed at the current federal reimbursement rate (Currently $0.45 cents per mile).  
Sales Reps will be required to maintain a cell phone as part of conducting sales business. Sales Rep will be provided an allowance of $50 per month for cell phone usage.  

Client entertainment expenses will be reimbursed as following:    

                Food: Reimbursable with receipts.  

Special Events: Must be pre-approved. Reimbursable with receipts. 
Expenses will be reimbursed within _30 days of being presented with the receipts and a completed expense reimbursement form.    

New Sale MRM Commission   

Performance Measure:  
Signup of a new customer and the margin (Monthly Recurring Margin) earned on the deal over the first three months is tracked here.  

Quota:  
There is no quota.  

Sales Credits:  
Sales Commission is paid to the Sales Rep based on MRM of the following merchant services products:  

• PaymentXL   
• MobilePay  
• GiftCardz  

Sales Rep earns commissions on sales where they had a direct responsibility for the sale.   
Sales Revenue minus Tax and Shipping charges are credited to the Sales Rep.
Sales credit is allocated on the booking of a contract. An advance commission on 3-month MRM is calculated and provided at the same time.  After three months the actual MRM is assessed, and commission is earned against that. The advanced commission is adjusted against the earned commission at the same rate.   

Calculation:
Sales credits related commissions are calculated at the following rates:
First 3 months of MRM.  

Example:  
Assuming Sales Rep completes the following sales-   

Contract     MRM      Duration  

Contract1   $200       1 month  

                                            Advance  = $600  

                    $250        1 month  

                    $100        1 month  

                                            True-up adjustment = -$50  

Equipment Incentive    

Sales Credits: 
 Sales Commission is paid to the Sales Rep based on equipment invoiced such as:     

• Terminal  
• Pinpad    

Sales Rep earns commissions on sales where they had a direct responsibility for the sale.   
Sales rep can markup the sale.  Sales Rep earns commissions only when an invoice to the customer is completely paid.    

Calculation:  
Sales commissions are paid as a percent of markup.
Commission rate = 90%    

Example:  
Assuming the following sale –  

 Invoice1 Pinpad  

List price     $200   

Markup        $100  

SalePrice      $300  

Commissions will be calculated as following: 
Invoice 1   $100 $100 X 90% = $90 (Commission)    

Residual Commission    

Sales Credits:  
Sales Commission is paid to the Sales Rep based on long term contracts:   
Sales Rep earns commissions on sales where they had a direct responsibility for the sale.   
Sales Rep earns commissions only when an invoice to the customer is completely paid.    

Calculation: 
Sales commissions are paid as a percent of MRM  
Commission rate = 2%  

Example:  
Assuming the following monthly MRM –  

Invoice 1    $1000  

Invoice 2    $1000  

Invoice 3    $2000    

Commissions will be calculated as following:  
$4000 $4000 X 2% = $80 (Commission)  

President’s Club
On achievement of 125% of the annual quota for the main sales commission incentive, Sales Rep will join the President’s club. President’s club members will be invited to the annual sales meeting trip held in the first quarter of the next year.  

Draw
During the first three months of employment with the company, the Sales Rep is provided a recoverable draw of $2,500 per month. The draw balance will be recovered as soon as possible from future earnings.    

Cap
There is no cap on any payouts to the Sales Rep.    

Termination of Employment
On   voluntary   or   involuntary   termination   of   Sales   Rep   employment   with   the     Company, commissions will be paid on transactions dated prior to the termination date only. Any amounts owed to the Sales Rep will be according to employment regulations after withholding taxes and other dues.    

Other Terms
1. Sales Rep agrees to follow all Federal and Local laws while engaged in providing services to the Company during the period of this agreement.  
2. Sales Rep shall not engage in any other employment during the term of this agreement. Company   reserves   the   right   to   require   Sales   Rep   to   terminate   any   such   other employment at Company’s sole discretion.  
3. Sales Rep shall use the most ethical practices while engaging in any sales activity.  
4. Sales Rep agrees to protect all confidential material including prospect data, sales data, and client information belonging to the Company and shall take all reasonable care in making sure that such confidential material is not disbursed to anyone outside the company.  
5. This entire agreement shall be governed by the laws of the State of ________.    

i Any part of this agreement can be changed or overridden based on your needs.
ii This date will give us information as to when this agreement was written and distinguish it from similar other agreements.  
iii Fill out the company name here . 
iv Fill out the payee's full name here . 
v Enter the start and end date for the sales commission plan effective period. Most companies use the calendar or fiscal year start and end date for these values. Some companies may not have an end date specified.  
vi Alternatively you can remove this section or rephrase it such as Base salary is specified in a separate employment agreement.  
vii Targeted sales compensation for the full year.  
viii Search for current IRS mileage rate.  
ix You can put any amount, or you may completely remove or change it based on your needs.  
x Alternatively, replace products with territory, customers, or types of business.