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With Natasa Cvijanovic

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Contract negotiations – Part 3

Top 7 items to check in

your agent agreement

By Natasa Cvijanovic agents or salespeople working for you, make sure the
Tesla Payments agreement includes the option to cure any wrongdoing
on their part by terminating them.
his article concludes my three-part series on 2. No liability, limited exposure
contract negotiations. In the first article of this
series, I discussed how to choose a good pro- Understand the liability clause if you are an MLS or
T cessor/ISO by understanding your portfolio retail ISO, as it could be detrimental to your business.
and your merchants' needs. In the second article, I dis- Make sure you are covered in regard to merchant losses.
cussed Schedule A and contacted Jill Miller of Bodman If you do what's right and follow the terms of your
PLC, an expert attorney in the industry, for her thoughts contract, you will be fine. Processors value sales agents
and feedback on Schedule A. She was incredibly kind who work hard and support their merchants. They are
and selfless, and I am grateful for her help. not actively looking to take your residuals unless you
have done something wrong intentionally.
I believe the information on this final article in the series
is so valuable that an introduction or hook is unnecessary. "Over-disclose, over-disclose, over-disclose," Miller
Without further ado, here is Miller's list of top items every recommended.
merchant level salesperson (MLS) should carefully review
in their agent agreement. 3. Mutual right to audit residuals (and do so within a
reasonable time)
1. Residuals in perpetuity
"The last thing you want is your partner coming back to
Unerstand the agreement's performance obligations. you 18 months later because they've made a mistake and
Suppose you have successfully sold hundreds, if not overpaid your residuals" Miller warned. At this point
thousands of merchant accounts and have accumulated you are likely to have disbursed the income further,
a monthly residual income of several thousand dollars, especially if you have subagents or other salespeople
only to discover that your residual income will be whom you pay residual overrides to.
terminated if you stop selling for a certain period of
time. 4. Non-solicitation
This is incredibly frustrating and not unheard of in our Non-solicitation is unquestionably a standard in any
industry. "The only reasons for terminating residuals agreement, but you can negotiate the length of the non-
are proven fraud or if you have violated the non- solicitation term and, as Miller suggested, make sure it
solicitation clause," Miller advised. "If you have sub- is not overly restrictive.
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