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Sales Caps Agreement


This Sales Caps Agreement (the “Agreement") is entered into effect from [Month Day, Year] (the "Effective Date") by and between [Your Company Name], a corporation located at [Your Company Address] (the "Company") and [Second Party], with its principal place of business located at [Second Party Address] (the "Second Party").

1. Background

The Company has established a sales commission and incentive plan to motivate and reward Salespeople for their efforts in generating sales. In order to manage compensation costs and align sales compensation with the Company's budget and revenue goals, the Parties agree to the terms and conditions outlined in this Agreement.

2. Commission Caps

2.1. Caps Period: The Commission Caps specified in this Agreement will be applicable during the fiscal year 2050.

2.2. Base Salary: The Salesperson's base salary is five thousand (5,000) dollars per month.

2.3. Commission Caps: The Parties agree to the following commission caps for the Caps Period:

Cap Period








2.4. Calculation of Caps: The caps will be calculated based on the Salesperson's earnings, including commissions, incentives, and bonuses, as defined in the Company's commission and incentive plan.

2.5. Exemptions: Certain exceptions may apply to the caps as specified in the Company's commission and incentive plan, such as:

  • High-value strategic accounts

  • Product category A sales

  • New business development incentives

3. Reporting and Review

3.1. Monthly Reporting: The Company will provide regular reports to the Salesperson, outlining their commission and incentive earnings, and their progress toward reaching the caps.

3.2. Quarterly Review: The Company and the Salesperson will conduct a quarterly review to assess the Salesperson's performance, earnings, and whether any adjustments to the caps are warranted. Adjustments may be made if there are exceptional circumstances or changes in business conditions.

4. Payment and Compliance

4.1. Payment: The Company will make commission and incentive payments in accordance with its regular payroll schedule.

4.2. Compliance: The Parties agree to abide by the terms and conditions of the Company's commission and incentive plan, as well as the terms specified in this Agreement.

5. Termination and Amendments

4.1. Termination: This Agreement may be terminated by either Party with written notice, subject to any applicable employment or contractual terms.

4.2. Amendments: Any amendments or modifications to this Agreement must be made in writing and signed by both Parties.

6. Entire Agreement

This Agreement constitutes the entire agreement between the Parties and supersedes all prior agreements, whether written or oral, relating to the subject matter hereof.

7. Governing Law

This Agreement shall be governed by and construed in accordance with the laws of where the Company is located.

8. Signatures

This Commission Caps Agreement is entered into on the Effective Date stated above.

[Your Name]

[Your Job Title]

[Your Company Name]


[Second Party Full Name]

[Job Title]


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