Commission / Sales Compensation Agreement - Alaska

COMMISSION / SALES COMPENSATION AGREEMENT

TABLE OF CONTENTS

1. Parties and Effective Date
2. Position and Territory
3. Commission Structure
4. Base Salary and Commission Split
5. Definition of Compensable Sale
6. Payment Timing
7. Draw Against Commission
8. Clawback and Chargeback Provisions
9. Post-Termination Commission Rights
10. Expense Reimbursement
11. Quota and Minimum Performance
12. Territory and Account Protection
13. Non-Compete Reference
14. Dispute Resolution
15. Termination Provisions
16. Alaska-Specific Legal Notes
17. General Provisions
18. Signatures

1. PARTIES AND EFFECTIVE DATE

Employer / Principal: [________________________________] ("Company")
Address: [________________________________]
State of Organization: Alaska

Employee / Sales Representative: [________________________________] ("Employee")
Address: [________________________________]

Effective Date: [__/__/____]

This Commission / Sales Compensation Agreement ("Agreement") is entered into by and between the Company and Employee as of the Effective Date set forth above.

2. POSITION AND TERRITORY

Job Title: [________________________________]

Reporting To: [________________________________]

Assigned Territory / Region: [________________________________]

Assigned Accounts / Verticals: [________________________________]

Employment Status:

• ☐ Full-Time Employee
• ☐ Part-Time Employee

3. COMMISSION STRUCTURE

The Employee shall be compensated under the following commission structure:

Option A — Percentage-Based Commission

Option B — Tiered Commission

Option C — Flat Fee Per Sale

Selected Structure: ☐ Option A ☐ Option B ☐ Option C

4. BASE SALARY AND COMMISSION SPLIT

Base Salary: $[________________________________] per [☐ year / ☐ month / ☐ pay period]

Compensation Model:

• ☐ Commission Only (no base salary)
• ☐ Base Salary + Commission
• ☐ Base Salary + Commission + Bonus

Target Total Compensation (estimated): $[________________________________] per year

Regular pay period elected by Employee: ☐ Semi-Monthly ☐ Monthly

Regular payday(s) and place/method of payment: [________________________________]

5. DEFINITION OF COMPENSABLE SALE

A "Sale" or "Closed Deal" for purposes of commission calculation is defined as:

[________________________________]

A commission is deemed earned when:

• ☐ The customer executes a binding purchase order or contract
• ☐ The customer makes full payment
• ☐ The product or service is delivered and accepted
• ☐ Other: [________________________________]

Excluded from commission calculation:

• ☐ Returns, cancellations, or chargebacks within [____] days
• ☐ Internal or employee sales
• ☐ Sales below $[________________________________]
• ☐ Other: [________________________________]

6. PAYMENT TIMING

Commission Payment Schedule:

• ☐ On each regular payday for commissions earned in the applicable pay period
• ☐ On the following regular payday after a commission becomes calculable under Section 5

The selected schedule does not defer compensation beyond an earlier deadline imposed by applicable law, including final pay under AS 23.05.140(b).

Commission Statements: The Company shall provide the Employee with a written commission statement on each commission payment date detailing the basis for the commission calculation.

7. DRAW AGAINST COMMISSION

Draw Applicable: ☐ Yes ☐ No

If Yes:

Draw Amount: $[________________________________] per [________________________________]

Draw Type: ☐ Non-Recoverable Guaranteed Minimum ☐ Recoverable Advance Under Separate Signed Schedule [IDENTIFY SCHEDULE]

No negative draw balance becomes a personal debt or payroll deduction by this checkbox alone. Any recovery schedule must state the amount, calculation, authorization, and applicable wage floor before the parties sign it.

8. CLAWBACK AND CHARGEBACK PROVISIONS

Clawback Applicable: ☐ Yes ☐ No

Clawback Period: [____] days from date of commission payment

Triggering Events:

• ☐ Customer cancellation within [____] days of sale
• ☐ Customer non-payment or default
• ☐ Return of product within [____] days
• ☐ Other: [________________________________]

Chargeback Calculation Method: [________________________________]

Adjustments apply only to commissions not yet earned under Section 5. An earned commission is not automatically forfeited or deducted from wages because a customer later cancels, returns goods, or fails to pay. Any recovery of an overpayment requires a separately documented lawful basis and may not defeat applicable minimum-pay or final-pay requirements.

9. POST-TERMINATION COMMISSION RIGHTS

Commissions Earned Before Termination:
All commissions that have been earned (as defined in Section 5) but not yet paid as of the date of termination shall be paid under AS § 23.05.140(b): within three (3) working days when the Company terminates employment, or on the next regular payday that is at least three days after the Company receives notice when the Employee terminates employment.

Commissions on Pending Sales:

• ☐ Employee is entitled to commissions on deals substantially procured by Employee but closed within [____] days after termination
• ☐ Employee forfeits commissions on deals not closed before the termination date
• ☐ Pro-rated commission on deals in progress at termination
• ☐ Other: [________________________________]

None of these selections forfeits a commission already earned under Section 5.

10. EXPENSE REIMBURSEMENT

The Company shall reimburse Employee for the following pre-approved business expenses:

• ☐ Mileage at the IRS standard rate
• ☐ Client entertainment (pre-approved)
• ☐ Travel expenses
• ☐ Cell phone / internet
• ☐ Other: [________________________________]

Reimbursement Procedure: Expenses must be submitted within [____] days with receipts via [________________________________].

11. QUOTA AND MINIMUM PERFORMANCE

Sales Quota: $[________________________________] per [☐ month / ☐ quarter / ☐ year]

Quota Review Period: [________________________________]

Consequences of Failing to Meet Quota:

• ☐ Performance improvement plan
• ☐ Reduction in territory
• ☐ Adjustment to commission rate (prospective only)
• ☐ Termination of employment
• ☐ Other: [________________________________]

12. TERRITORY AND ACCOUNT PROTECTION

Exclusive Territory: ☐ Yes ☐ No

If Yes, the Company shall not assign another salesperson to Employee's designated territory during the term of this Agreement, except:
[________________________________]

Account Ownership Rules:
[________________________________]

Split Commission Policy (if applicable):
[________________________________]

13. NON-COMPETE REFERENCE

☐ A separate Non-Compete / Non-Solicitation Agreement is attached or incorporated by reference.

☐ A separate Confidentiality and Proprietary Information Agreement is attached or incorporated by reference.

14. DISPUTE RESOLUTION

Governing Law: This Agreement shall be governed by the laws of the State of Alaska.

The parties may use a court of competent jurisdiction. Any arbitration arrangement must be in a separately signed agreement identifying its scope, forum, rules, and allocation of costs.

15. TERMINATION PROVISIONS

Employment Relationship: This compensation plan does not change the employment term or termination standard stated in any separate signed employment agreement.

Notice of Termination:

• ☐ No separate employment notice term applies
• ☐ [____] days' written notice under the separate signed employment agreement dated [__/__/____]

Upon Termination:

1. All earned commissions shall be paid per Section 9 and applicable final-pay law
2. Company property must be returned within [____] days
3. Any draw balance shall be handled only under a separately signed lawful recovery schedule, if one exists

Modification of Commission Plan:
Changes to this commission plan require a written amendment signed by both parties, apply prospectively only, and do not affect commissions already earned.

16. ALASKA-SPECIFIC LEGAL NOTES

Final-Pay Timing: Under AS § 23.05.140(b), employer-terminated employment requires payment within three working days after termination. Employee-terminated employment instead requires payment on the next regular payday that is at least three days after the employer receives notice.

Potential Penalty for Late Payment: Under AS § 23.05.140(d), an employer that violates the final-pay timing may be required to pay the employee's regular wage, salary, or other compensation from demand to payment, capped at 90 working days. Subsection (e) separately makes that penalty mandatory in an action brought by the department and specifies the calculation for that action.

Pay Notice: AS § 23.05.160 requires written notice at hiring of the day and place of payment and the rate of pay, and notice of a change on the payday before it takes effect.

Commissions: Define the earning event and calculation in Section 5. Compensation due upon separation follows AS 23.05.140(b); the parties should not treat a future customer-payment condition as a waiver of an amount already earned.

Minimum Wage and Overtime: AS 23.10.065(a)(2) sets $14.00 per hour effective July 1, 2026, for covered employees, including work measured by commission. Confirm coverage first: AS 23.10.055(a)(9)(B) exempts an outside salesman or a salesman employed on a straight commission basis from AS 23.10.050–.150. If covered, meet the minimum wage and applicable AS 23.10.060 overtime requirements regardless of the commission formula.

Pay Periods: AS 23.05.140(a) provides for monthly or semi-monthly pay periods at the employee's election unless monthly pay is agreed in an annual initial employment contract. AS 23.10.060 governs overtime, not pay-period frequency.

17. GENERAL PROVISIONS

Entire Agreement: This Agreement constitutes the entire agreement between the parties concerning commission compensation and supersedes all prior agreements on this subject.

Severability: If any provision is found invalid or unenforceable, the remaining provisions shall continue in full force and effect.

Amendment: This Agreement may only be amended in writing signed by both parties.

Counterparts: This Agreement may be executed in counterparts, each of which shall be deemed an original.

18. SIGNATURES

By signing below, both parties acknowledge they have read, understand, and agree to the terms of this Agreement.

EMPLOYER

Signature: [________________________________]
Printed Name: [________________________________]
Title: [________________________________]
Date: [__/__/____]

EMPLOYEE

Signature: [________________________________]
Printed Name: [________________________________]
Date: [__/__/____]

SOURCES AND REFERENCES

• AS 23.05.140–.160 — pay periods, final pay, and pay notice
• AS 23.10.055–.065 — coverage exceptions, overtime, and minimum wage