AGENCY OR SALES REPRESENTATIVE AGREEMENT
1. Parties
2. Territory (exclusive/nonexclusive)
3. Grant of authority to represent/sell product (agent or sales representative)
4. Product(s) description
5. Reservation of Principal/Seller’s rights
6. Duration of contract (fixed term vs. evergreen)
7. Performance criteria: sales quotas, duties (reports, advertising, facilities etc.)
8. Compensation
9. Payment procedures
10. Order-taking/processing procedures and terms of sale
11. Sales outside territory
12. Status as employee or independent contractor (dependent/independent agent)
13. Restrictions on sales representation (conflict of interest/duty of loyalty)
14. Accounting
15. Marketing and sales tools/expenses
16. Confidentiality/non-compete
17. Termination and termination procedures
18. Compliance with US and local laws
19. Governing law and language
20. Dispute resolution

DISTRIBUTION AGREEMENT
1. Parties
2. Territory
3. Grant/Scope of sales rights
4. Product(s) descriptions
5. Duration of agreement
6. Performance criteria
7. Price
8. Payment terms
9. Delivery; late delivery
10. Warranty
11. Information supplied by seller
12. Promotion of goods
13. Sales/marketing plans
14. Reports to seller
15. Changes in price or terms
16. Inspection of books and records/audit rights
17. Refusal of orders
18. Change in product specifications
19. Training of personnel
20. Technical support for customers
21. Confidentiality/non-competition
22. Force majeure
23. Customs clearances and payment of tariffs
24. Competitive restrictions (and limits on restrictions)
25. Trademark and patent rights and registrations
26. Termination grounds
27. Termination rights and procedures, including inventory repurchase
28. US export control compliance/local law compliance
29. Governing law and language
30. Dispute resolution

1. Parties
2. Subject matter of the License
   a. Definitions
   b. Proprietary information subject to the license
3. Grant of License
   a. Exclusive or non-exclusive
   b. Territory
   c. Manufacture
   d. Use and sale
   e. Field of use
4. Improvements by Licensor
5. Improvements by Licensee
   a. Grant-back clause (beware anti-trust violation if exclusive)
   b. Use
   c. Royalty or royalty-free
6. Technical Assistance
   a. Supply of drawings, specifications, instrumentation etc.
   b. Instructions regarding necessary resources, machinery etc.
   c. Manufacturing techniques and know-how
   d. Advertising, marketing support, sales aids
   e. Training
7. Quality Control
8. Royalties and Other Compensation
   a. Lump sum
   b. Periodic
   c. Combination and sliding scale
   d. Training fees and costs
   e. Products or components upon which royalties are calculated and paid
   f. Time and manner of payments
   g. Taxes
   h. Minimum payments
9. Accounting
   a. Inspection of books and records
   b. Audit
   c. Finality
10. Representations and indemnification
    a. Third party claims re: infringement of proprietary rights
    b. Third party claims
    c. Sufficiency of technology
    d. Fitness for a particular purpose
    e. Warranty of non-infringement
11. Enforcement and Protection of Proprietary rights
    a. Marking
    b. Registration
    c. Internal procedures
    d. Need to know
    e. Defense of proprietary rights
    f. Technical escrow
    g. Escrow of royalties
12. Term of License
    a. Term of years
    b. Life of proprietary rights
    c. Renewal
    d. Early termination
    e. Effect of sale, merger, or change in control
13. Sublicense and Assignment
14. Confidentiality
    a. Nondisclosure (secrecy)
    b. Noncircumvention (noncompetition)
15. Breach and Termination
    a. Grounds constituting breach
    b. Opportunity to cure
    c. Grounds for termination for cause
    d. Continuing rights and obligations
    e. Return of proprietary information
16. Administrative Compliance
    a. Registration
    b. Regulation of subject matter
    c. Taxation
    d. Export controls (screening)
    e. U.S. laws
17. Rights and Remedies
18. Controlling Law
19. Dispute Resolution
20. Miscellaneous

1. Purpose (include the general purpose of the JV and the goals for each JV Party)

2. Form of Joint Venture (JVC, contractual, LLC, or corporation)

3. Contributions of each Joint Venture Party

4. Ownership interests

5. Capital structure (debt and equity)

6. Responsibilities of each Joint Venture Party

7. Ancillary (supplementary) agreements to Joint Venture Agreement

8. Management and governance

9. Managerial policies (Operating Blueprint/Agreement)

10. Accounting and financial matters

11. Internal and external dispute resolution mechanisms

12. Legal and administrative compliance

The subpoints are too numerous to list. Be sure to take good notes in class.

Checklist for International Sale of Goods

The following is a checklist of twenty-five terms commonly found in a detailed contract for the international sale of goods. The purpose of a checklist is to make sure that the negotiator or drafter of an agreement considers the terms for use in the final agreement. Not all terms will be found in every good sales contract, sometimes other terms are needed, and most of them are not legally required. There is no legal requirement that the terms are separate and there is no required form for the contract. Terms are often combined together. It is good practice to be more thorough rather than less thorough in international contracts to avoid disputes, misunderstandings and ambiguities. On the other hand, it is also important to keep the contract as simple as possible. The skilled drafter knows that this means careful drafting of all useful terms rather than omission of terms for the sake of brevity or simplicity. Read the comments regarding these terms in light of the material in the book. These comments omit much basic material regarding these terms and are meant to supplement your reading.

1. Parties: the parties to the contract should be described with particularity, including full name, address, telephone, facsimile, email, and type of business entity. Thus, there is minimal chance of mistaken identity. In some countries, the government may own corporations wholly or partially. Care should be taken to determine whether the entity is in fact an arm of the government in which case sovereign immunity must be addressed.

2. Description of Goods: The subject matter of the contract must be described completely and accurately. If a product line or different products are part of the same contract, the goods are often described in detail in an exhibit that gets attached to the main body of the contract. However, a general description of the goods in the main body of the contract is good practice and should still be sufficiently detailed so that a substituted description of goods in the exhibit can be readily detected. In other words, the parties should not simply describe the goods by referring to an exhibit.

3. Quantity: The number of units of goods sold is the only term in contracts for the sale of goods that is always essential. All other terms may be implied and the contract can be enforced, although this is not good practice. In this paragraph, the drafter will often state that seller is selling to buyer and buyer is buying from seller the quantity of goods described. If the contract is for different goods, it is essential that the quantity of each good be separately stated, unless the sale is an assortment or lot (like assorted flavors of jelly beans).

4. Price: Except for CIF and C&F contracts, the unit price for each good sold should be stated along with the total contract price. The unit price is the price for the good itself, excluding transportation costs, insurance or any other additional charge. The price should also refer to and agree with the trade term for the contract or the price may be ambiguous. The total contract price may include any other charges such transportation, insurance, duties, exit documents etc. Thus, the contract price often will not simply be product of the unit price times the quantity. In many, if not most cases, the total contract price will not state precisely the actual total amount the buyer will pay, since the costs of transportation, insurance and other add-ons are determined later (the buyer simply agrees in the contract to pay them). Since these charges can be estimated in advance and the seller has a legal obligation to make reasonable arrangements, or the buyer can elect to make its own arrangements, there should not be any unpleasant surprises for the buyer.

5. Payment Terms: In international contracts, payment terms are often sufficiently detailed to require separate explanation in the contract. For example, it is not sufficient to state that payment shall be by letter of credit. The requirements for the letter of credit should be stated with particularity and detail, including the size and quality of a bank acceptable to the parties to issue the letter of credit for the benefit of the seller.

6. Currency: Although it is implied that payment is to be made in the currency specified in the price term, it is better practice to state the currency required for payment. Merely specifying a currency does not address exchange-rate risk and is often unacceptable to one of the parties, particularly to the seller if the buyer’s currency is weak and vice versa. There are numerous ways to allocate exchange-rate risk, but it is advisable for a US company new to importing or exporting to stick with dollars even if this practice costs an occasional sale than to get involved in the complexities of exchange rates. The primary business of an importer or exporter involves the goods. Currency speculations, arbitrages and other such strategies, while potentially lucrative, should be left to the experts. Obviously, a company with a huge annual turnover in international sales must be able to deal in multiple currencies and manage the associated risks (and opportunities!).

7. Order Process; Term (Time) of Contract: This paragraph is needed only if delivery of the goods will take place in lots over time, particularly if the buyer specifies the time for shipments or has a requirements contract. Companies new to international sales should start with single lot shipments of goods (with a renewal provision for subsequent orders) and as they become more experienced move into longer-term contracts. The term of a requirements or output contract must always be stated and should never be evergreen (automatic renewal or extension). Contracts that merely require delivery over time do not need a paragraph stating a specific term of the contract, but a delivery schedule should be established and stated in the contract.

8. Transportation and Trade Term: Arrangements for transportation should be stated with particularity and include the trade term governing the contract. Trade terms are necessarily precise in international contracts and the choices are found either in Incoterms or the UCC. The UNCISG does NOT contain its own trade terms. The description of the transportation arrangements should not vary or modify the requirements of the chosen trade term.

9. Delivery Schedule: The time for delivery is often material. However, time is not of the essence unless the parties expressly agree. Thus, merely stating a delivery date is not sufficient if a deadline is truly material. The term “delivery” can also be misleading in that a common interpretation is that it refers to when goods are received. Since most contracts for goods are shipment contracts and delivery is complete at the shipment point, care should be taken in using the term “delivery” to conform to date of shipment. Finally, if the parties contemplate shipment in lots, a schedule is appropriate to include.

10. Packaging; Insurance: Standard packaging of goods may not be adequate for transoceanic transportation. When in doubt, specify the required packaging. Insurance of the goods should not be taken for granted. Although the seller generally has the obligation to arrange insurance for the benefit of the buyer, insurance may be weak or non-existent in certain countries, in which case the buyer should make its own arrangements.

11. Export License; Fees; Import Duties: These items often exist and are frequently forgotten. How a good is classified will determine the type of license to export that is required. Classification will also determine its dutiable status as an import in a given country. The seller should not presume the buyer knows how the good will be classified. Once, both parties ignored this issue and the duty imposed was 100% of the value of the goods. It would have been possible to have had the good classified differently at 17% duty had the parties researched the issue in advance. As a result a $50,000 product cost the buyer $100,000; the buyer blamed the seller and never bought from it again.

12. Title: When title passes is generally not important in the US under the UCC but can be important in other countries and under the UNCISG. Thus, the seller should always inquire whether and this should be specified in the contract. If the contract is silent title passes per operation of law depending on the trade term used.

13. Warranties: Express warranties can be a strong selling tool. From the 1970s to late 1980s warranties have been limited in the United States in an attempt to deter certain kinds of litigation. This policy was shortsighted and not altogether successful. Today, many US companies are again strongly warranting the specifications and performance of products as a way to boost foreign sales.

14. Product Liability; Indemnity: Overseas parties are scared of US product liability law. When I represent a US importer, I subject the exporter to these laws. When the importer objects, my reply is that it is standard. The importer is subject to them by operation of law anyhow. When I represent the US exporter, I do not include anything in the contract about product liability. Again the US exporter is subject to these laws but there is no obligation to call attention to it. This term is often used to coordinate defense against and indemnity for third party product claims, specifying cooperation of the buyer and seller in defense of these claims.

15. Performance Criteria; Conditions: This is a catch-all provision that the parties can use to tailor their agreement to specific circumstances, changed circumstances etc. Performance criteria beyond the basic terms above are rarely needed in straight-forward contracts for the sale of goods but in a hybrid contract with both goods and services involved, a section laying out how the parties will work together can be valuable. I frequently use a provision like this one to set up my client’s right to recover consequential contract damages, as a way of hiding the remedy in plain view and obtaining agreement to it without negotiating it.

16. Breach, Default and Termination: Specifying the conditions of breach and default is sometimes valuable in and of itself, but it is more useful to couple grounds constituting breach or default with an opportunity to cure the problem before terminating the contract. Watch out that by specifying some grounds of breach or default does not get interpreted as the sole grounds of breach or default, thus negating other grounds by operation of law.

Be sure to work within the constraints of the UCC or UNCISG because there are material differences in the approach to breach, termination, and remedies. Remember, that courts generally try very hard to preserve the existence of a contract.

17. Rights and Remedies: My typical approach is simply to state that the parties will have all the rights and remedies afforded to them under the UCC or UNCISG. This is balanced and fair, and fashioning unique remedies is rarely warranted.

18. Inspection of Goods; Claims & Returns: Buyer always has the right to inspect goods (although this right could be waived), even though payment has already been made. If inspection cannot be accomplished without some testing then it is appropriate to specify inspection rights; otherwise, it is acceptable to rely on the code provisions. A claim and return policy should be specified if the seller has one or needs one for a particular contract with a particular buyer. Obviously, this provision needs to tie to the breach and rights & remedies clauses.

19. Assignment: Assigning contracts to a third party is rare in international contracts for goods. I generally prohibit assignment or strictly limit it.

20. Amendment: Amending the contract must be done in writing.

21. Force Majeure: This “boilerplate” clause is often used to expand the list of excuses of performance by including non-force majeure events. Do not do this and always read this clause carefully looking for “ringers” that don’t belong here.

22. Administrative & Regulatory Compliance; US parties should reference appropriate US laws. Include a general statement that neither party will do any act under the agreement that might be in violation of applicable laws in either country. Always determine the extent to which the subject matter of your contract is subject to administrative or regulatory compliance; then make sure your contract and performance complies.

23. Sovereign Immunity: Know whether you are dealing directly or indirectly with a foreign government. If you are, determine whether there is a written government claims process in that country. If not, you will have to bargain for a waiver of sovereign immunity (and good luck).

24. Governing Law & Language: Always specify the law that governs the contract (i.e., UCC or UNCISG or Swiss law, etc). If the contract is written in more than one language, a primary language governing the contract for interpretation purposes must be specified.

25. Dispute resolution. Always specify a process for mediation and, if mediation is unsuccessful, binding arbitration to resolve disputes. Consider making the venue for dispute resolution an attractive neutral location. Avoid specifying expensive tribunals like AAA or ICC as the provider of dispute resolution services.