10. Any clauses that could kill my business after I work so hard?
Absolutely none in our agreement, provided that you act honorably and in good faith, according to the terms of the 5PP Affiliate Agreement. If you’re working hard to build your 5 Pillar Business, we’d never terminate you -you have it in writing. Most affiliate programs have clauses that allow them to terminate their agreements at any time, for any reason. Here’s a clause from an actual agreement... And here’s another... “Either party may terminate this agreement, for any reason and in their sole
discretion, “Don’t these types of clauses threaten my business,” you ask? Sure they do!
Bottom line when you’re terminated? They’ve built an ongoing business... but At least this time you’ll watch out for this kind of termination clause. I’m not saying that all other affiliate programs are bad. Far from it. Lots of good programs simply include this termination automatically due to their lawyers’ “knee-jerk reflex.” But you should recognize the risk, especially if your goal is to build a long-term business with equity. There’s another clause that’s almost as hazardous to your business health... This basically allows the company to change the rules whenever it likes. Once again, you are exposed. This time, however, the company is expressing a fair need. But the “at our sole discretion” is unfair to you. Here’s why some kind of modification clause is needed... The Net moves too fast to foresee everything. A company must be able to change quickly to meet new challenges. If a rigid contract required written agreement from all affiliates, it would be paralyzed. So how can one meet both the company’s need for flexibility and the affiliate’s need for protection? Very simple... “SiteSell may, in good faith, modify any of the terms and conditions of this agreement.” The “good faith” clause does it all. It gives us the necessary flexibility to run a rapidly expanding biz in a fast-changing marketplace. It protects you against unfair, one-sided rule changes. Let’s look at an example... Suppose we “go for the gold.” Yup, we reduce your commission from 30% to 1%. Whoa! I already said it was an example! If that ever happened (it would not), you’d have a strong case to sue... because that would not be “in good faith.” It’s important to put that kind of protection in your hands. Think it can’t happen? Are you thinking, “The company that I represent has too much to lose by terminating or changing the agreement. After all, they would alienate all their affiliates if they ever did that.” Well, there are many scenarios where affiliates could get turfed. Here’s one... Suddenly, the affiliates are an unnecessary expense. The point is this - if Widget.com has the absolute right to terminate or change the agreement, you are exposed. As I mentioned above, lots of good programs still contain this kind of “knee-jerk
reflex” legal clause.
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Presented in Association with SiteSell and George Rusky.
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