A sample Groupon merchant agreement

See the Groupon, LivingSocial and daily deals merchant FAQ.

Please note that this agreement is a bit more than a year old. I also published a Groupon agreement from January 2011.

If anyone has a fresher one and wants to share, please let me know. (And if you want me to delete your personal details, please let me know that.)

See also:

Groupon Terms and Conditions

I. Voucher Information

Groupon shall promote the Voucher per Section 1.2 of the Merchant Agreement. Merchant is the seller of the goods and services described in Voucher. The Voucher itself will be sent to the purchaser electronically. The purchaser will then redeem the Voucher from the Merchant.

  1. Merchant offer is as follows: [redacted] $[x] for $[xx]
  2. The offer by Merchant is contingent upon a minimum number of units sold (the “Volume Threshold”), which is agreed to be 50.
  3. Expiration date: Merchant agrees that the offer will be available per the terms above for a period of at least 6 months from feature date and subject to no further restrictions by the Merchant. To the extent required by applicable law, after the Opportunity Expiration Date, Merchant shall permit the purchaser to redeem the Voucher for the goods and services of the Merchant in the amount of the cash paid by purchaser, until that cash amount is redeemed in full.
  4. Partial redemptions: If a customer redeems a Voucher for less than its face value, the Merchant will not be responsible for issuing a credit or cash equal to the difference between the face value and the amount redeemed, unless otherwise required by law. However, the Merchant will be required to permit the purchaser to redeem the Voucher in the amount of the cash paid by the purchaser, as noted in Section 3 above.
  5. Special Instructions or limitations (if any): – 1 per person, multiples as gifts-No cash back. Must use in single visit-Not valid w/ other offers

II. Payment

Groupon will pay Merchant $[X] for each Voucher properly activated for which a purchaser has fully paid Groupon, less a 2.5% of total sales credit card processing fee (the “Remittance Amount”) in accordance with this paragraph. Merchant is registered for sales and use tax collection purposes, and shall be responsible for paying all sales and use taxes related to the goods and services described in the offer. Groupon shall forward one-third of the Remittance Amount to Merchant within five (5) business days from the Run Date (as that term is defined in Section 1.2 of the Merchant Agreement), an additional one-third within thirty (30) business days of the Run Date, and the final one-third within sixty (60) business days of the Run Date. Amounts retained by Groupon are compensation to Groupon for the service of advertising and selling the Groupons for Merchant.

Merchant Agreement

Date of Agreement: [redacted]

Merchant Name(herein referred to as “Merchant”):

[merchant info redacted]

This Merchant Agreement, effective as of the above date (“Effective Date”), is entered into by and between Groupon, Inc., a Delaware corporation with principal offices at 600 West Chicago Ave., Suite 725, Chicago, IL 60610 and Merchant, a retailer doing business in the state of (“Merchant”). The parties shall be referred to collectively as the “Parties.”

Merchant wishes to offer its products or services for sale through vouchers (the “Voucher(s)”) which can be redeemed for Merchant’s goods and/or services at a discount, which are offered to the public for purchase at www.groupon.com (the “Website”) and are activated (“Activated”) only upon reaching an agreed upon volume of purchasers (“Volume Threshold”) and an agreed upon discount; and Groupon wishes to sell Merchant’s Voucher to the purchasers at the Website, the Merchant being the seller of the goods and the services, and Groupon being the seller of the intangible rights contained in the Merchant’s Voucher.  Therefore, in consideration of the mutual covenants of the Parties and other valuable consideration, the sufficiency and receipt of which is hereby acknowledged, the Parties agree as follows:


1. Voucher Program.

1.1 Voucher Sale. Merchant authorizes Groupon to offer, sell and distribute the Voucher, in accordance with this Agreement and subject to the restrictions set forth in the Groupon Terms and Conditions. Merchant acknowledges that Groupon may terminate the publication or promotion of the Voucher at any time. All terms contained in the attached Groupon Terms and Conditions, including Sections I and II (Voucher Information and Payment) (collectively, the “Terms”) are incorporated hereto and made a material part hereof.  Groupon reserves the right to increase the Volume Threshold at its sole discretion.

1.2 Voucher Publication and Delivery. Vouchers shall be published on the Website in accordance with the Terms. The last date on which Groupon publishes the Voucher and offers it to its users shall be considered the Run Date.  The Voucher shall be activated, which means capable of being used for purchases with the Merchant in accordance with the terms of the Voucher as set forth in the Terms, only when the certain Volume Threshold of purchasers has been met. At the time that the Volume Threshold has been met; Groupon will electronically deliver the Voucher to the purchaser.  Once a Voucher is Activated and delivered to the purchaser, Merchant shall be solely responsible for all customer service in connection with the Voucher and for supplying all goods and services specified in the Voucher. Groupon further reserves the continuing right, but shall not be obligated, to reject, revise, or discontinue publishing any Voucher and to require Merchant to edit or modify the same for any reason, including, without limitation, to conform the Voucher to Groupon specifications or applicable Laws.

1.3  Payment. Groupon shall remit payment to Merchant according to the schedule and terms set forth in the Terms. Amounts retained by Groupon are compensation to Groupon for the service of advertising and selling the Vouchers for Merchant.

1.4  License. Merchant grants to Groupon a non-exclusive worldwide license and right to use, reproduce, display, distribute and transmit the Merchant’s name, logo and any trademarks (“Merchant Marks”) and any photographs, graphics, artwork, text and other content provided or specified by Merchant (“Content”) in connection with the marketing, promotion, sale or distribution of Vouchers, in any and all media or formats in which such Vouchers are marketed, promoted, transmitted, sold, or distributed, including but not limited to, on the Groupon Website.

2. Term and Termination. This Agreement shall continue in effect for the longer of one (1) year following the Effective Date or the last date when a customer of Groupon redeems a Voucher offered by Merchant through Groupon.  Groupon may terminate this Agreement at any time for any reason by giving the Merchant written notice of such termination.  The expiration of the Term shall not in any way affect the purchaser’s usage of the Voucher, or Merchant’s obligation for redemption of the Voucher.  Upon execution of the Agreement, Merchant agrees that Merchant will not promote an online offer with respect to the products or services described in the Terms of similar or greater value for a period up to 60 days from the Effective Date, plus a minimum of 60 days following the Merchant’s date of feature on the Groupon Website. Sections 3, 4, 5, 6 and any claims for payments due Groupon hereunder shall survive any expiration or termination of this Agreement.

3. Merchant Representations and Warranties, and Indemnification.

3.1 Merchant represents and warrants throughout the Term that: (a) Merchant has the right, power and authority to enter into this Agreement; (b) Merchant is registered for sales and use tax collection purposes in all states in which Merchant’s goods and services will be provided pursuant to the terms and presentation of the Voucher; (c) the Voucher, upon being Activated and delivered by Groupon shall be available immediately for redemption by the purchaser; (d) the terms and conditions of the Voucher, including any discounts or goods and services offered thereunder, comply with all, and do not and will not violate any, local, state or federal law, statute, rule, refulation, or order (“Laws”), including but not limited to, any Laws governing vouchers, gift cards, coupons, and/or gift certificates; (e) Merchant owns all right, title and interest in the Marks and Content and has the right to grant the licenses in the Marks and Content stated in this Agreement; (f) the Vouchers and any advertising or promotion of Merchant’s products and services relating thereto will not constitute false, deceptive or unfair advertising or disparagement under any applicable Laws; and (g) the Marks and the Content do not and will not violate any copyright, trademark, or other intellectual property right or right of privacy or publicity of any third party or any Laws.

3.2 Merchant agrees to defend, indemnify and hold Groupon, its affiliated and related entitites, and any of their officers, directors, agents and employees, harmless from and against any claims, lawsuits, investigations, penalties, damages, losses or expenses (including but not limited to attorney’s fees and costs) arising out of or relating to any of the following: (a) any breach or alleged breach by Merchant of this Agreement or the representations and warranties stated in Section 3.1; (b) any claim for state sales or use tax obligations (“Taxes”) arising from the sale and subsequent redemption of a Voucher; (c) any claim by any local, state or federal governmental entity for unredeemed Vouchers or unredeemed cash values of Vouchers or any other amounts under any applicable abandoned or unclaimed property or escheat law, including but not limited to any claims for penalties and interest (“Abandoned Property Claims”); or (d) any claim arising out of or relating to the products and services provided by Merchant, including but not limited to, any claims for false advertising, product defects, personal injury, death, or property damages. Without limiting the foregoing, Merchant shall pay any monies owed to any party, as well as all attorneys fees, related to action against, or determinations against, Groupon related to any such action to pursue Groupon for Taxes or Abandoned Property Claims.

4. Compliance with Gift Card, Gift Certificate and Abandoned Property Laws. Merchant further agrees to comply with the Voucher terms and conditions as set forth on the Website, and to ensure that the Vouchers comply with any and all Laws that govern vouchers, gift cards, coupons, and/or gift certificates, including but not limited to, the Credit Card Act of  2009 and any state or local Laws governing the imposition of expiration dates, service charges, dormacy fees or other terms and conditions of the Voucher. Merchant shall allow the purchaser to redeem the Groupon with Merchant for the amount paid by purchaser for the Voucher (i.e. the cash or redemption value of the Voucher) for the applicable term specified under applicable state or federal Laws and shall allow the cash redemption of the Vouchers as required by applicable state or federal Laws. To the extent required by applicable escheat or abandoned or unclaimed property Laws, Merchant shall be solely responsible for and agrees to report and pay over to the applicable local, state or federal governmental agency any unredeemed cash value of any Voucher issued under this Agreement. Merchant is responsible for keeping track of the cash amount paid by the purchaser for the Voucher and any unredeemed balance of that cash amount to ensure compliance with this section 4.

5. Confidentiality and Intellectual Property Rights.

5.1 The terms of this Agreement are confidential, and Merchant agrees to not disclose the terms described herein to any party (other than their employees, parent companies, and shareholders on a need-to-know basis only after each has taken the necessary precautions of the kind generally taken with confidential information to preserve the confidentiality of the information made available to such individuals).  The terms contained herein are confidential between Groupon and Merchant and not known to the general public outside of this Agreement, thus any breach of this confidentiality provision by Merchant shall be considered a material breach of this Agreement and will result in irreparable and continuing damage to Groupon for which there will be no adequate remedy at law; and in the event of such breach, Groupon will be entitled to injunctive relief and/or a decree for specific performance, and such other and further relief as may be proper (including monetary damages if appropriate).

5.2 Merchant agrees and acknowledges that Groupons owns all right, title, and interest in the Groupon Website, Groupon trademarks, and any software, technology or tools used by Groupon to promote, market, sell, generate, or distribute the Vouchers (collectively the “Groupon IP”). Merchant shall not rent, lease, sublicense, distribute, transfer, copy, reproduce, download, display, modify or timeshare the Groupon IP or any portion thereof, or use such Groupon IP as a component of or a base for products or services prepared for commercial sale, sublicense, lease, access or distribution. Merchant shall not prepare any derivative work based on the Groupon IP. Merchant shall not translate, reverse engineer, decompile or disassemble the Groupon IP.

6. Other. The Parties are independent contractors. Nothing in this Agreement shall be construed to create a joint venture, partnership, franchise, or an agency relationship between the Parties. Neither Party has the authority, without the other Party’s prior written approval, to bind or commit the other Party in any way.

This agreement constitutes the entire agreement between the parties relating to its subject matter and supersedes all prior or contemporaneous oral or written agreements concerning such subject matter. This agreement may be amended or modified only by mutual agreement of authorized representatives of the Parties in writing.

Merchant may not assign or transfer its rights or obligations under this Agreement, whether by operation of law or otherwise, without Groupon’s prior written consent.



Any claim arising out of or relating to any error or omission in a Voucher must be made within 120 days of first publication of the Voucher. Otherwise, the claim shall be deemed waived by Merchant.

This Agreement shall be governed by and construed in accordance with the laws of the State of Illinois, without giving effect to the conflict of law principles thereof. The parties irrevocably consent to the exclusive personal jurisdiction (except as to actions for the enforcement of a judgement, in which case the jurisdiction will be non-exclusive) of the federal and state courts located in the State of Illinois. This Agreement may be executed in one or more counterparts and each party consents to electronic message (e-mail or otherwise) as acceptable means to constitute a written acceptance of an authorized person for such party. Each party represents and warrants that the person executing on behalf of such party has been duly authorized to execute this Agreement.


About Rakesh Agrawal

Rakesh Agrawal is Senior Director of product at Amazon (Audible). Previously, he launched local and mobile products for Microsoft and AOL. He tweets at @rakeshlobster.
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20 Responses to A sample Groupon merchant agreement

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  9. visamac says:

    I’m not so often on these kind of blog since I’m busy sometime but your blog is interesting and I like reading it.

  10. Hmmm, one might think that Groupon has got a little to big for itself.

    Some of these terms can really shut down a small business, if
    not read and executed carefully…

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