Profit Sharing Agreement Letter Sample

Profit sharing is a great way for businesses to incentivize their employees to work harder and smarter towards achieving the company`s goals. However, in order to ensure that all parties involved are clear on the terms of the profit sharing arrangement, it is important to have a profit sharing agreement in writing. In this article, we will provide you with a profit sharing agreement letter sample that you can use as a template.

Dear [Employee Name],

As a valued member of our team, we are excited to offer you a profit sharing agreement in recognition of your important contributions to the success of our company. The purpose of this agreement is to outline the terms of our profit sharing arrangement.

Profit sharing will be calculated based on [insert formula for calculating profit sharing]. The profit sharing amount will be calculated at the end of each [insert period of time for calculating profit sharing] and disbursed [insert frequency of profit sharing disbursement].

Please note that the profit sharing amount is subject to change based on company performance. We reserve the right to adjust the profit sharing amount at any time to ensure that it is in line with our financial goals.

In order to be eligible for profit sharing, employees must meet the following criteria:

– [insert criteria for eligibility]

If an employee leaves the company before the end of the profit sharing period, they will only be eligible for a prorated amount of the profit sharing based on the amount of time they worked during the period.

We believe that this profit sharing agreement will motivate our team to work harder and contribute to the growth of our company. Please sign below to acknowledge your acceptance of the terms of this agreement.

Sincerely,

[Insert Company Name]

By signing below, you acknowledge that you have read and agree to the terms of this profit sharing agreement.

Employee Signature: ______________________

Date: ______________________

In conclusion, a profit sharing agreement is an excellent way to incentivize employees to work towards the company`s goals. By using this profit sharing agreement letter sample as a template, you can create a clear and concise agreement that outlines the terms of your profit sharing arrangement for your employees.