What a sell-side mandate contains, clause by clause

A mandate to sell a TLD is a short document. Its brevity can mislead a holder into treating it as a formality. It is not. Every clause in it answers a question that, if left unanswered, surfaces at the worst possible moment: when a serious buyer has appeared, when a fee dispute has arisen, or when a conversation that should have stayed private has not.

This article walks through a sell-side mandate in the order a lawyer would explain it to a client sitting across a desk. The goal is not to make you a contract lawyer. It is to make you a holder who can read a draft, ask the right questions, and understand what you are agreeing to before you sign. A sell-side mandate is where a sale through an intermediary starts, so it is the right document to read slowly.

By the end, you will know what each clause does, which points are negotiable in practice, and which details are worth a conversation with your own counsel before you sign. Nothing here is legal advice, and no clause described below is required by law: these are the clauses a careful draft usually contains, and the rules that apply to them vary by country.

What a mandate is, and why it is in writing

A mandate is the written authority you give an intermediary to act on your behalf in a transaction. Without it, the intermediary has no standing to approach counterparties in your name, no agreed basis for a fee, and no defined role if something goes wrong.

The written form matters for three reasons. First, it records what the parties actually agreed, not what each remembers agreeing. Memory in a transaction is unreliable, and the stakes of a TLD sale are high enough that you do not want to test it. Second, it gives the intermediary the documented authority it needs when a prospective buyer asks: “Are you authorized to speak for the holder?” Third, it protects the holder. A mandate that is badly drafted or missing a clause can leave you paying a fee you did not expect, or held in an arrangement you cannot exit when you need to.

The mandate governs only the relationship between the holder and the intermediary. It is not the purchase agreement: that document is negotiated separately, at the point when a buyer has been identified and terms agreed. Think of the mandate as the instruction the holder gives before the search begins, and the purchase agreement as the document that closes the search out.

One consequence follows. A point that belongs in the purchase agreement, such as what the buyer receives and when, does not need to be settled in the mandate. A point that concerns how the intermediary behaves while the search runs does. When you are unsure where a question belongs, ask which relationship it concerns.

Scope: which asset, which side

The first substantive clause of any mandate identifies the asset being sold and the role the intermediary is taking. Both details matter more than they appear to.

The asset. An onchain TLD is a specific token on a specific blockchain, recorded in a specific registry. The mandate should describe it precisely enough that there is no ambiguity: the TLD string, the registry on which it lives, and the wallet that holds it. Vague descriptions like “my TLD portfolio” or “the .yourbrand name” without further specification can create disputes about whether other TLDs you hold are in scope.

If the TLD comes with ancillary elements (resolver settings, records of names already issued under it such as pay.yourbrand, or a commercial relationship built around it), the mandate should say whether those pass with the TLD or are excluded. A buyer will want to know. For names, the position is settled: those you hold yourself under the TLD can be transferred with it if you and the buyer agree, while those already sold to third parties remain theirs and are not yours to include. It is better to clarify it now than to negotiate it under time pressure during due diligence.

The side. A sell-side mandate authorizes the intermediary to act for the holder as seller. It does not authorize the intermediary to represent the buyer in the same transaction. An arrangement where one party acts for both sides of a single deal raises a conflict of interest question, and a well-drafted mandate will either exclude it explicitly or require the holder’s written consent before it can occur. Read this clause. If the mandate is silent, ask.

The scope clause also often states the asking price, or a floor below which the intermediary has no authority to entertain an offer without coming back to the holder. Where no floor is stated, nothing in the document constrains what the intermediary may discuss with a buyer, and the first conversation about price happens with a third party in the room instead of between you and the intermediary.

Confidentiality and the NDA

Confidentiality in a TLD sale operates at two levels: the existence of the mandate itself, and the information exchanged with prospective buyers during the process.

Mandate confidentiality. The fact that a holder is seeking to sell can, if disclosed too early, affect how the TLD is perceived or attract low approaches from parties who would otherwise not have engaged. A well-drafted mandate will require the intermediary to keep the engagement confidential, and to say nothing about the holder to a prospective buyer until a non-disclosure agreement is in place.

Information exchanged with buyers. Before the intermediary can share meaningful information about the TLD with a buyer (technical details, any revenue data, or the holder’s price expectations), a non-disclosure agreement should be signed. The mandate should define which category of information may be shared before that agreement exists, usually no more than the TLD string and a general description of the asset, and what must wait until after.

Hush Partners, for its part, places every exchange under a standard mutual NDA, mutual meaning that each side owes the other the same duty of confidence.

Survival. Confidentiality obligations should survive the end of the mandate. If the mandate expires without a deal, the information the intermediary gathered about your asking price, your timeline, and the parties you considered should not be freely usable once the relationship ends. Check that a survival period is stated in the draft, and ask your counsel whether its length is reasonable for an asset you may hold for a long time after a failed sale.

The NDA clause in the mandate is not the NDA itself. A clause that says exchanges will be covered by a non-disclosure agreement defers to a separate document. Review that separate document before the mandate is signed, not after a buyer has already appeared.

Exclusivity: what it means and why it may be absent

Exclusivity is the clause that says: for the duration of this mandate, you will not engage any other intermediary to sell this TLD, and you will not sell it directly to a buyer who did not come through me.

Many intermediaries that take a sell-side engagement ask for exclusivity, because it protects them from the situation where they have invested time and effort and the holder then completes the sale through a different channel. From the holder’s perspective, exclusivity is a reasonable request, provided the term is short enough and the exceptions are right.

What to look for in an exclusivity clause

The clause should specify:

• The period of exclusivity, with a defined start date and a defined end.
• Whether the holder keeps the right to sell to a buyer the holder was already speaking to before the mandate was signed. If you had a conversation with a potential buyer some time before engaging an intermediary, you do not want to owe a fee on that deal.
• What happens if the intermediary is not performing. A well-drafted mandate will allow the holder to end exclusivity, or the mandate entirely, if the intermediary fails to meet a minimum standard of activity, for example by providing no updates or making no approaches within a defined period.
• Whether exclusivity extends through a tail period after the mandate ends. A tail means that if a buyer introduced by the intermediary during the mandate concludes a deal after it has ended, the fee is still owed. A tail is a common feature of intermediary agreements and is not unreasonable in itself. Read how long it runs and which buyers it covers.

When exclusivity is absent

Non-exclusive mandates exist, particularly for TLDs that a holder is willing to sell but is not actively promoting. In a non-exclusive arrangement, the holder may engage several intermediaries or sell directly, and the fee is owed only if this specific intermediary found this specific buyer.

The trade-off is plain. A non-exclusive mandate gives the holder more flexibility and gives the intermediary less reason to invest heavily in the file. It also raises a practical problem for a holder who values discretion: several intermediaries approaching the same small set of likely buyers about the same TLD is the opposite of a quiet process. For a TLD where a targeted, private approach matters, that is the argument for exclusivity, and it is worth weighing against the freedom you give up.

Authority: what the intermediary may do without asking

The authority clause defines the scope of the intermediary’s agency: which acts it may take on its own, and which require the holder’s prior approval. Together with the fee clause, it deserves the most careful reading in the document.

A sell-side intermediary will generally need authority to:

• Say that the TLD is available for acquisition
• Approach prospective buyers and disclose the TLD string
• Receive offers and relay them to the holder
• Provide buyers with factual information about the TLD once a non-disclosure agreement is signed
• Negotiate terms on behalf of the holder, within stated parameters

What the intermediary should generally not be authorized to do without express approval:

• Accept an offer on the holder’s behalf
• Execute any purchase agreement
• Agree to a price below any floor stated in the mandate
• Disclose the holder’s identity to a buyer
• Engage sub-brokers or other third parties

The authority clause should also address representations, meaning statements of fact made to a buyer. If an intermediary tells a prospective buyer that the TLD is “free of all third-party claims”, that statement could bind the holder if the mandate authorizes the intermediary to make it. Confirm that the mandate requires any factual representation about the TLD to be approved by the holder before it is made to a buyer.

Compare the clause with how the intermediary says it works. Hush Partners publishes its rules of engagement; two of its practices bear directly on this clause: a single named partner stays with a file from the first note through closing, and the seller of a given TLD is never named. A mandate and an intermediary’s stated practice should point the same way. Where they differ, the signed document is the one that counts, so ask for the difference to be resolved in the text.

The fee: when it falls due and who owes it

The fee clause answers four questions: how much, on what trigger, payable by whom, and for how long after the mandate ends.

How much. Intermediaries price their work in different ways, and the clause should leave no doubt about which way applies. Hush Partners charges a fixed amount and never a percentage of the price. Whatever the structure in the draft before you, check whether other costs, such as legal or escrow costs, sit outside the fee and are billed separately. If the draft is silent on costs, ask for a sentence that settles the point.

The trigger. A fee clause will specify the event that makes the fee payable. Common formulations are:

• On signature of a binding purchase agreement
• On closing, meaning completion of the transfer
• On introduction of a ready, willing and able buyer

The difference matters. “On introduction” means the fee is owed when a qualifying buyer is found, even if the holder then walks away from the deal. “On closing” means no fee is owed unless the transfer actually completes. Neither is wrong in principle, but each allocates the risk of a failed deal differently, and you should know which one you are accepting. The trigger language should be unambiguous: a clause that leaves room for two readings will be read against you at the moment you least want an argument.

Who owes it. The fee is owed by the party who mandates the intermediary. In a sell-side mandate, that is the holder. With Hush Partners, the rule runs the same way in both directions: only the client who gives the mandate is charged, and a party that answers a note from the desk, or buys a TLD offered through it, pays the price of the TLD and nothing more. If a draft from any intermediary suggests that the buyer will also pay it something, ask how that affects whose interests it serves.

The tail. As noted under exclusivity, a tail period may mean the fee is owed on a deal that closes after the mandate has ended, if the buyer was introduced while it ran. The tail should have a clear outer limit, and “introduced” should be defined. A buyer who received one unanswered note is not in the same position as one who negotiated for weeks.

The table below maps the main clauses against the question each one answers. Use it as a checklist when reviewing a draft.

Term and ending

The term clause sets the start and end dates of the mandate, and the termination clause describes how either party can end the arrangement before it expires.

Duration. A mandate term is measured in months and is usually renewable by agreement. A term that is too short creates pressure to accept an early offer instead of waiting for the right buyer. A term that is too long keeps the holder in an arrangement that may not be working. A shorter initial term with a renewal option serves both parties when the intermediary is confident in the asset and the approach, because renewal then becomes a decision you make with evidence of how the first period went.

Automatic renewal. Some mandates renew automatically unless one party gives notice. This is not unreasonable in itself, but the notice period before renewal should be long enough that the holder has a real opportunity to decide. If the window to object is so short that you could miss it during an ordinary absence, ask for a longer one, or for renewal by express agreement only.

Termination for cause. The holder should have the right to end the mandate if the intermediary materially breaches its obligations: failing to report, acting outside its authority, breaching confidentiality, or making no substantive approach within a defined period. Termination for cause should not require a long waiting period and should not trigger a fee.

Termination for convenience. Some mandates allow either party to end the arrangement on notice, without cause. If that right exists for the holder, check whether using it triggers any fee. A termination for convenience that nonetheless triggers the full fee is a right in name only, and a term worth renegotiating.

Effect of termination. When a mandate ends, the intermediary’s authority to act ends with it. Any conversation still open with a prospective buyer should pass to the holder or be wound down. The mandate should say clearly which, and who tells the buyer, because a buyer left without an answer draws its own conclusions about the TLD and about you.

What the holder undertakes during the mandate

A mandate is not a one-way document. While the intermediary takes on obligations to perform, the holder takes on undertakings that are easy to overlook because most of the document is about what the other side will do.

Not to circumvent. In an exclusive mandate, the holder typically undertakes not to negotiate directly with any party introduced by the intermediary, and not to conclude a sale through any other channel, while the mandate runs. Breach of this undertaking will often make the fee payable in full, even if the intermediary played no part in the eventual deal.

Not to encumber the asset. The holder should undertake not to create any pledge, charge or other third-party right over the TLD during the mandate. A buyer who expects a clean transfer and then discovers an encumbrance will either withdraw or ask for a lower price. If the TLD already serves as collateral in a financing arrangement, say so before the mandate starts. Raised early, it is a fact to plan around. Raised late, it is a closing problem.

To provide accurate information. The intermediary will rely on what the holder says about the TLD to frame its approach to buyers. If those statements are inaccurate, for example if the holder says the TLD is clear of third-party claims when it is not, the holder bears the consequences. Before engaging, go through your own position honestly: who controls the wallet, whether anyone else has rights in the TLD, and whether a trademark owner has ever written to you about it. A complication you disclose at the start can be handled. One that a buyer finds in due diligence damages the whole file.

To maintain the asset. The holder should keep the TLD in good standing with its registry throughout the mandate, meet whatever the registry’s terms require, and take no action that would change the TLD’s technical status without telling the intermediary. That includes moving the TLD to a different wallet. The move may be harmless, but a buyer who checked the public record last week and sees a different holder this week will have questions.

To respond promptly. When the intermediary needs a decision (whether to accept a meeting, how to respond to a counter-offer, whether to share more information with a buyer), the holder should respond within the period stated in the mandate. A buyer’s interest does not survive long silences. A mandate that says nothing about response times leaves both parties without a reference point when a delay becomes a problem.

What happens to information afterwards

Information generated during a mandate (the identity of parties approached, the terms discussed, the holder’s floor, a buyer’s budget and timeline) stays commercially sensitive long after the mandate ends. The mandate should address what happens to it.

Return or destruction. At the end of the mandate, whether it expires or is terminated, the intermediary should return or destroy the confidential information the holder provided. The mandate should specify which. With digital documents a copy can always be kept after a “return”, so an obligation to destroy, confirmed in writing, provides more assurance.

Residual knowledge. Any person who has worked on a file will keep in memory what they learned. The mandate cannot erase that. What it can do is prohibit the use of that knowledge against the holder: assisting a third party in a transaction involving the same TLD, for instance, or reusing the holder’s floor in a later negotiation. These prohibitions should survive the mandate for a defined period.

The intermediary’s records. An intermediary may have to keep records of its work for legal or professional reasons, and the rules on this vary by country. The mandate can acknowledge that, while confirming that such records are held confidentially and are not used for any purpose beyond the engagement.

The buyer’s side. Information also flowed the other way. A buyer who looked at the TLD and did not proceed still knows that it was available and roughly on what terms. That is what the non-disclosure agreement with the buyer is for, which is another reason to read it before the mandate is signed.

For advisers reviewing a mandate on behalf of a holder, the post-termination provisions are easy to skim, because they describe a moment nobody at the signing table expects to reach. They are worth the same attention as the fee clause.

Before you sign: a practical sequence

Reading a mandate clause by clause is the starting point. Acting on that reading is the step that matters.

Before signing, confirm these four things with the intermediary:

1. The TLD is described exactly as it appears in the registry record. That record is public, and anyone can check it on a block explorer.
2. The fee trigger and the tail period are stated in unambiguous language.
3. The confidentiality obligations run both ways and survive the mandate for a defined period.
4. The authority clause names only acts you have approved, and nothing in it authorizes the intermediary to accept an offer or execute documents on your behalf.

Then, before work begins, confirm with your own counsel that the mandate is consistent with any other agreement you have signed that touches the TLD: financing documents, co-ownership agreements, or earlier agreements with other intermediaries.

If you have not yet formed a view of what the TLD is worth, do that first, because the mandate will ask you for a floor. The TLD Readiness Score is a free tool that scores how ready a TLD is to be sold, and a holder can request a private valuation from the desk.

Hush Partners acts for holders under a mandate of this kind, and the page for holders describes that work. The stages of a file, from the mandate to the transfer, are set out under how it works, and closing runs through onchain escrow on an aftermarket. The intermediary runs that sequence. The mandate is what authorizes it to begin.

Questions people ask

Does signing a mandate commit me to selling?

No. A sell-side mandate authorizes the intermediary to find and approach buyers and to negotiate on your behalf within stated parameters. It does not bind you to complete a sale. You remain free to decline any offer, subject to whatever the mandate says about the fee trigger. If the fee is owed on introduction of a ready, willing and able buyer, then depending on the drafting, declining an offer that meets your stated floor could still make the fee payable. Your counsel should confirm the trigger language before you sign.

What happens if I receive a direct approach from a buyer while the mandate is live?

Under an exclusive mandate, the usual course is to tell the intermediary and refer the approach to it. If you engage directly with a buyer, you may breach the exclusivity undertaking, even when the buyer arrived independently. Some mandates carve out that situation, so check the language. If you are unsure, do not respond to the direct approach until you have spoken to the intermediary and, if necessary, your counsel.

Can the mandate be amended after it is signed?

Yes. A mandate is a contract and can be varied by agreement of both parties. Common amendments include extending the term, adjusting the stated floor, or narrowing the scope to exclude a TLD you have decided to keep. Whether a short message saying “agreed” is enough depends on the governing law and on what the mandate itself says about amendments. Where the change is material, use a written amendment signed by both parties.

Who sees the mandate itself?

The mandate is a confidential document between the holder and the intermediary. It is not shown to prospective buyers, who see only the information authorized under the scope and confidentiality clauses. A buyer has no reason to learn what fee the holder has agreed to pay, what floor has been set, or what the holder’s timeline looks like. If your draft does not say this, ask for it to be added.

Is the mandate governed by a particular country’s law?

The mandate will name a governing law and, usually, a place for disputes. For a holder based in a different country from the intermediary, this point deserves attention. The choice of governing law affects how the fee trigger, the authority clause, and the confidentiality obligations are interpreted. The intermediary will have a preference. Whether that preference suits you is a question for your own counsel.