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The Referral Agreement is a document that establishes a mutually beneficial relationship between two parties, referred to as the First Party and the Second Party. The agreement aims to enhance business opportunities for both parties by allowing them to refer prospective clients to each other. The document begins with a brief introduction, stating the purpose of the agreement and the parties involved. It then proceeds to outline the scope of services, which includes the identification and introduction of prospective clients in exchange for a commission. The referring party is responsible for identifying and introducing prospective clients to the receiving party, utilizing their best efforts to facilitate introductions and communications. However, the referring party is not entitled to a commission for prospective clients who were already in contact with the receiving party before the effective date of the agreement. The document also specifies that the prospective client will be deemed rejected if not accepted within 10 days of receiving the referral. The commission is calculated based on a percentage of the income generated from a referred prospective client and is paid by the receiving party within 30 days of receiving non-refundable income. The referring party's obligations include diligently working to identify and introduce prospective clients, not making any binding commitments on behalf of the receiving party without prior consent, and keeping the receiving party's business secrets confidential. The agreement also includes provisions for termination, limitation of liability, and miscellaneous clauses. Overall, the Referral Agreement is an important document for establishing a referral relationship between two parties and ensuring clear terms and conditions for the referral process.
To use the Referral Agreement effectively, follow these steps:
1. Identify and introduce prospective clients: As the referring party, diligently work to identify potential clients who may benefit from the services of the receiving party. Make sure to keep a record of all prospective clients.
2. Facilitate introductions and communications: Use your best efforts to facilitate introductions and communications between the receiving party and the prospective clients. Exchange relevant information and arrange meetings as necessary.
3. Ensure acceptance of referrals: The receiving party should accept or reject the referral within 10 days of receiving it. If accepted, proceed with the referral process. If rejected, consider alternative options.
4. Calculate and issue invoices: Once the referring party's commission has been determined by the receiving party, issue an invoice for the commission amount.
5. Receive payment: The receiving party should make the payment of the commission within 30 days of receiving non-refundable income from the referred prospective client.
6. Maintain confidentiality: As the referring party, keep all of the receiving party's business secrets confidential. Do not make unauthorized copies or records of any confidential information.
7. Termination: Either party has the right to terminate the agreement by providing written notice at least 30 days before the intended termination date. However, the referring party's obligations regarding confidentiality will survive the termination.
8. Avoid solicitation: After the termination of the agreement, the referring party should refrain from soliciting or approaching any of the receiving party's clients, manufacturers, or suppliers.
9. Seek legal advice: If you have any concerns or questions about the agreement, it is advisable to seek legal advice to ensure compliance with applicable laws and regulations.
By following these steps, you can effectively use the Referral Agreement to establish a successful referral relationship and enhance business opportunities for both parties involved.