What is a Broker Agreement?

This template is written for agents, brokers, affiliates and their principals, so that both sides can see what was promised, what it costs, and what happens if circumstances change.

18 details are captured across 6 areas: parties and contact details, scope and deliverables, payment and financial terms, dates, timing and duration, confidentiality and intellectual property, and legal protections and risk. Together they fix what the introducer owes the principal, measured in qualifying introductions rather than in adjectives.

The recurring failure in this kind of arrangement is a commission trigger nobody defined precisely enough to apply. Business agreements tend to fail at the edges — deadlock between owners, automatic renewals nobody diarised, and liability caps that turn out to sit above the value of the contract.

Fill in the form and the broker agreement assembles as you type, so you can read the finished wording before you download it. The draft is a starting point built on standard contract structure — it is not legal advice, and for a high-value or unusual arrangement it is worth having an attorney check it against the rules in your state.

What matters most in a broker agreement

Tail period after termination

Agree whether commission is payable on deals that close after the agreement ends but originated from the agent's work, and for how long.

Chargebacks and refunds

For sales and payment arrangements, say what happens to commission already paid when a customer refunds or charges back.

Define the commission trigger precisely

Is it earned on introduction, on contract signature, or on payment received? This single point causes more commission disputes than any other.

When you need a broker agreement

  • Before the introducer starts: Put the broker agreement in place before anyone relies on it. An agreement signed after work has begun is far harder to enforce on the terms you actually intended.
  • When someone else is paying: Where a third party funds or guarantees the arrangement, they should be named and their obligations spelled out. A guarantee that is only implied is not a guarantee.
  • When sensitive information is shared: Confidentiality terms should be signed before disclosure, not after. Information already shared without protection is very difficult to claw back.
  • When the tail period during which commission is still owed has value: Where something is still owed after each qualifying sale, that obligation needs its own words. Anything expected to survive the end of the agreement has to say so.
  • When the referred business needs defining: Write down what is included and what is not. A specific description is what turns an extra request into a chargeable variation rather than an argument.
  • When either side may need an exit: Agree how the arrangement ends while both parties are still on good terms. Exit clauses negotiated during a dispute rarely favour anyone.

What to include in a broker agreement

This generator collects 18 details. Here is what each group covers and why it matters when the document is relied on.

Parties and contact details

Everything else in the document hangs off these names: the introducer carries the obligations, the principal carries the payment, and both need identifying precisely enough to be found later.

Company Name
The company's registered legal name, including its corporate suffix such as LLC, Inc or Ltd.
Company Address
The company's registered office or principal place of business.
Counterparty Name
The full legal name of the other party entering into this agreement.
Counterparty Address
The counterparty's address for formal notices.

Scope and deliverables

This is the section that decides arguments. Describe the referred business in qualifying introductions and against the dated record of who was introduced and when, so that whether it has been delivered is a question of fact rather than opinion.

Purpose of Agreement
Why the parties are entering into the agreement. This helps a court interpret ambiguous clauses in line with the parties' actual intent.
Products or Services
The goods or services supplied, identified by specification, model or catalogue reference.
Performance Standards
The measurable standard the work must meet — response times, quality levels or service metrics.

Payment and financial terms

Payment terms are relied on more often than any other clause and left vague more often than any other clause. State the amount, the trigger, the deadline and what follows a late payment.

Commercial Terms
The core business terms — volumes, discounts, rebates, minimum commitments and review points.
Pricing
The unit prices or rate card, plus how and when prices may be revised.
Payment Terms
The invoicing cycle, payment window, accepted methods and consequences of non-payment.
Limitation of Liability
The cap on each party's financial exposure. Note that liability for fraud, death or personal injury generally cannot be excluded.

Dates, timing and duration

These dates decide when obligations start, when they end, and when someone is in breach. Each qualifying sale in particular should have a date and a test attached to it.

Effective Date
The date the agreement takes effect. This can differ from the signature date, and it is the date obligations start running from.
Delivery Timeline
Lead times and delivery windows, plus what counts as a late delivery and the remedy for it.

Confidentiality and intellectual property

Signed before disclosure, these clauses work. Signed afterwards, they are an attempt to claw back information that has already gone.

Confidentiality Obligations
The duty to keep information private, who it may be shared with internally, and the standard of care required.
Intellectual Property Rights
Who owns the IP created under the agreement, and what licence the other party receives.

Legal protections and risk

Naming the governing law and the forum here avoids a preliminary fight about where a dispute over the referred business is even heard.

Warranties
The promises each party makes about quality, title and authority, and how long they last.
Termination Rights
The circumstances in which each party may end the agreement, distinguishing termination for convenience from termination for breach.
Governing Law
The legal system that applies and the courts that will hear any dispute.

Completing this broker agreement

Planning around a commission trigger nobody defined precisely enough to apply

Since this is the common failure in this kind of arrangement, decide now who absorbs it. A clause of two sentences here is worth more than a page of general good intentions.

Getting the numbers right

Write key figures out in full where the amount is central, and state the currency if either party is outside the country. Both are cheap precautions against an expensive misunderstanding on a broker agreement.

Checking the consents

Where a landlord, lender, insurer or licensing body has to approve the arrangement, obtain that approval before each qualifying sale rather than assuming it will follow as a formality.

Recording where this applies

If the parties are in different states, name which state's law applies and where any dispute would be heard. Adding one line now avoids a preliminary argument later.

Signing and keeping it

Every party named should sign and date, and each should keep their own copy. Electronic signatures are valid for the great majority of agreements — retain the audit trail showing who signed and when.

Common mistakes to avoid

  1. Late payment with no consequence. If nothing happens when the principal pays late, late payment becomes the norm. Interest on overdue sums plus a right for the introducer to suspend gives the clause teeth.
  2. Skipping the notice details. Say where notices go, in what form, and when they count as received. Agreements fail at this point more often than at the clauses people actually negotiate.
  3. No route out. Agree how the arrangement ends while the introducer and the principal still get on. Exit terms negotiated during a dispute rarely favour anyone, and they cost far more to settle.
  4. Overlooking third-party consents. Where a landlord, lender, insurer or regulator has to agree, get that consent before each qualifying sale rather than assuming it will follow.
  5. No deadlock mechanism. Two equal owners who disagree can paralyse a business. Buy-sell provisions and a valuation method are far cheaper to agree at the start than to litigate later.

How to use this broker agreement generator

  1. Fill in the form. Enter the 18 details requested. Where an entry depends on a count — qualifying introductions, dates, amounts — put the number in rather than a description of it. Nothing is sent to a server — the document is assembled in your browser.
  2. Read the preview. Read the preview as though you were the principal rather than the introducer. Anything ambiguous is easier to fix now than to argue about after each qualifying sale.
  3. Download and sign. Download in either format and circulate for signature. Diarise the dates the document creates, particularly anything that has to happen before each qualifying sale.

Broker Agreement — frequently asked questions

When is commission actually earned?

Whenever the contract says — and the difference is substantial. Commission on introduction is earned even if the deal collapses; commission on payment received means the agent carries the risk of the customer defaulting. Most disputes arise because the agreement said only that commission is payable 'on the sale', which resolves nothing. Define the trigger event and the payment date separately.

What records should I keep alongside the broker agreement?

The dated record of who was introduced and when, the signed document itself, and a contemporaneous note of anything agreed afterwards. Most disputes turn on what was agreed at the time, and the party who can produce a dated record is the party who wins that argument.

How detailed does the broker agreement need to be?

Detailed enough that someone who was not part of the conversation could read it and tell whether each side has done what it promised. That is the standard a court applies, and it is a useful test to run over your own draft before signing.

Which state's law should govern this broker agreement?

Choose a state with a genuine connection to the parties or the subject matter — where a party is based, or where the work or property is located. A choice with no connection at all may not be respected, and for property or employment the local state's rules will often apply regardless of what the contract says.

Who owns the work produced under this agreement?

Whoever the agreement says owns it — and if it says nothing, the creator generally does. Paying for work does not transfer copyright by itself. If ownership is meant to pass to the client, the assignment clause needs to say so expressly, and it is common to make the transfer conditional on payment in full.

How long do the confidentiality obligations last?

Ordinary commercial information is usually protected for a fixed period of two to five years after the agreement ends, while genuine trade secrets are often protected for as long as they stay secret. Whichever you choose, state expressly that the confidentiality clause survives termination — otherwise the protection ends with the contract.

Can liability be limited to any amount?

Within limits. Parties can cap ordinary commercial liability, and a cap set against contract value or insurance cover is normal. But liability for fraud, death and personal injury generally cannot be excluded, and a cap so low it makes the obligations meaningless may be struck down as unreasonable.

Are electronic signatures valid for commercial agreements?

Yes. Under the US ESIGN Act and equivalent legislation elsewhere, electronic signatures carry the same legal weight as ink for the vast majority of business contracts. Keep the audit trail showing who signed and when.