Long-term Supply Agreement: Definition & Sample

ContractsCounsel has assisted 65 clients with long-term supply agreements and maintains a network of 90 business lawyers available daily. These lawyers collectively have 13 reviews to help you choose the best lawyer for your needs. Customers rate lawyers for long-term supply agreement matters 4.95.

What is a Long-term Supply Agreement?

A long-term supply agreement (LTA) is a type of contract that sets out the terms and conditions for supplying goods or services over a period of time, typically longer than one year. LTAs can provide benefits for both buyers and sellers, but it's important to ensure that all parties are clear on the expectations and obligations set out in the agreement.

Common Sections in Long-term Supply Agreements

Below is a list of common sections included in Long-term Supply Agreements. These sections are linked to the below sample agreement for you to explore.

Long-term Supply Agreement Sample

Confidential Treatment Requested

LONG TERM SUPPLY AGREEMENT

ACTIVE POWER, INC.

GE ZENITH CONTROLS, INC.

LONG TERM SUPPLY AGREEMENT

This Long Term Supply Agreement (“Agreement”), made and entered into this day of March 16, 2005, between Active Power, Inc, a Delaware corporation, with offices at 2128 West Braker, Austin, Texas 78758, hereinafter referred to as “Active Power” and GE Zenith Controls, Inc., a Delaware corporation, (and a wholly owned subsidiary of General Electric Company a/k/a GE) with offices at 830 West 40 th Street, Chicago, IL 60609, hereinafter referred to as “GE Zenith”.

Whereas, Active Power is a user/reseller of, Uninterruptible Power Supplies and related accessories, hereinafter “Products” and desires to purchase Products from GE Zenith and Whereas, GE Zenith is a producer of said Products that Active Power desires and is willing to produce and sell the same to Active Power upon the terms and conditions hereinafter stated.

NOW, THEREFORE, the parties agree as follows:

Section 2. Quantities, Ordering, and Shipment

Section 3. Pricing and Payment

Section 4. Warranty and Product Safety Approvals

sold by Active Power. GE Zenith shall reimburse Active Power for the agreed upon expenses for labor, travel and other costs associated with a warranty repair. GE Zenith will provide a reimbursement schedule for warranty items. Only one warranty repair allowed per unit unless authorized by GE Zenith. GE Zenith shall reimburse Active Power for any part consumed on a warranty related repair. Active Power may contact GE Zenith to supply any warranty repair or service under the standard GE Zenith product warranty. Active Power or any one of Active Power’s Qualified Service & Support Vendors will only perform service on GE Zenith Units sold by Active Power unless otherwise authorized by GE. This same condition applies to GE Zenith if Active Power hires GE to service Active Power units.

Section 5. Confidentiality/Non-Disclosure Agreement

Section 6. Termination

and continues in default thereof for thirty (30) days after notice to such other party of the default; or, (b) If, with respect to payment, Active Power fails to make payment to GE Zenith within the time provided herein and the failure continues for sixty (60) days after receipt of written demand for payment.

Section 7. Non-Performance

Section 8. Assignment

Section 9. Notices

Section 10. Invalid Provision

Section 11. Waiver

Section 12. Attachments Part of the Agreement

Section 13. Amendments

Section 14. Headings

Section 15. Applicable Law

Section 16. Relationship of the Parties

Section 17. Entire Agreement

This Agreement constitutes the entire Agreement and understanding between the parties as to the subject matter of this Agreement. No representations, warranties, or promises have been

made that are not fully set forth herein. As of the Effective Date, this Agreement replaces any and all previous Agreements between GE Zenith Controls, Inc. and Active Power. It is the intention of both parties that we continue to grow and develop our relationship to optimize the use of the capabilities of both parties and minimize the inefficiencies in all aspects of our business relationship.

Section 18. Signatures

In witness whereof, the parties have executed this Agreement by their duly authorized officers as of day and year set forth on the first page.

/s/ Sriram Sivaram

Sriram Sivaram Tom Duffy Vice President, Sales & Marketing GM Sales Active Power, Inc. GE Zenith Controls, Inc. General Electric Company

ATTACHMENT #1 - CONFIDENTIALITY AND NON-DISCLOSURE AGREEMENT

In consideration of the disclosure of proprietary information by Active Power, Inc., (hereinafter “Active Power”), 2128 West Braker, Austin, TX 78758, and GE Zenith Controls, Inc. (hereinafter “GE Zenith”), 830 West 40 th Street, Chicago, IL 60609 to each other, which information relates to present and prospective business relations between Active Power and GE Zenith. Such information includes data relating to disclosing party’s products, product development, manufacturing processes, product designs, materials and technology and/or other information not generally available to the public which is disclosed to or acquired by the non-disclosing party, from the disclosing party (hereinafter collectively “Proprietary Information”), the parties agree as follows:

IN WITNESS WHEREOF, each party hereto has caused this Agreement to be executed by its duly authorized representative.

/s/ Sriram Sivaram

/s/ Thomas P. Duffy

Name & Title: VP of Sales and Marketing Name & Title: General Manager of Sales Date: 3/17/2005 Date: 3/16/2005

PROJECT TERMS AND CONDITIONS

The sale of any service and products, and the integration thereof, ordered by the Customer is expressly conditioned upon the terms and conditions contained or referenced herein. Terms and conditions included in the GE Industrial Systems (herein called GE) proposal, where not in conflict with the terms included herein, shall be incorporated by reference. Any additional or different terms and conditions set forth in the Customer’s purchase order or similar communication are expressly objected to and will not be binding upon GE unless specifically agreed to in writing by an authorized GE employee.

PROJECT shall be defined as the sale of products and services, and may incorporate any one or more of the following:

GE warrants to Customer that products and any services furnished hereunder will be free from defects in material, workmanship and title and will be of the kind and quality specified in the GE written quotation. The foregoing shall apply only to failures to meet said warranties (excluding any defects in title) which appear within one (1) year from installation or eighteen (18) months from the date of shipment, whichever occurs first; provided, however, that if Customer, in the course of its regular and usual business, transfers title to or leases such products (including equipment incorporating such products) to a third party, such period shall run until one (1) year from such transfer or lease or eighteen (18) months from shipment by GE, whichever occurs first.

GE warrants that ENGINEERING STUDY/ INSPECTION/ TEST performed pursuant this agreement shall be prepared in a professionally competent manner, however, GE does not assume responsibility for specific operating results, nor for achieving desired objectives. This warranty applies only to failures which appear within one year from the date services are furnished, provided that Customer promptly notifies GE in writing of such failure. GE shall reperform any such defective portion of the services provided. If reperformance is not practicable, GE will furnish, without charge, services in an amount essentially equal to those that, in GE’s judgment, would have been required for reperformance of the defective service.

In no case does this warranty apply to any failure or nonconformance with specifications caused by or attributable to any associated or complementary products not supplied under this contract, nor shall it in any case apply to the quantity or quality of the product of Customer or the process of manufacture on which the products are used. The warranty and remedies are conditioned upon (a) proper storage, installation, use and maintenance, and conformance with any applicable recommendations of GE, and (b) Customer promptly notifying GE of any defects and, if required, promptly making the product available for correction.

If any product or service fails to meet the foregoing warranties (except title), GE shall thereupon correct any such failure either, at its option, (i) by repairing any defective or damaged part or parts of the products, and/or reperforming any defective service, or (ii) by making available, F.O.B. the GE plant or other mutually agreed upon point of shipment, any necessary repaired or replacement parts. If reperformance is not practicable, GE will furnish without charge services in an amount essentially equal to those that, in the sole judgment of GE, would have been required for reperformance. Where a failure cannot be corrected by GE’s reasonable efforts, the parties will negotiate an equitable adjustment in price.

In providing products or renewal parts, GE reserves the right to use refurbished circuit boards, which shall be warranted in accordance with this article. GE does not warrant computer hardware, software or products and services obtained from others but only the warranty of the manufacturer shall apply. GE’s obligation under this warranty shall terminate immediately upon any modification of products or software by Customer unless made with the approval of GE.

THE PRECEDING PARAGRAPHS SET FORTH THE EXCLUSIVE REMEDIES FOR CLAIMS (EXCEPT AS TO TITLE) BASED ON DEFECT IN OR FAILURE OF PRODUCTS OR SERVICES, WHETHER THE CLAIM IS IN CONTRACT, INDEMNITY, WARRANTY, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY OR OTHERWISE. Upon the expiration of the warranty period, all such liability shall terminate and Customer shall have a reasonable time, not to exceed thirty (30) days after the warranty period, to give written notice of any defects that appeared during the warranty period. EXCEPT AS SET FORTH IN ARTICLE 3, “PATENTS” AND ARTICLE 4, “SOFTWARE WARRANTY”, THE FOREGOING WARRANTIES ARE EXCLUSIVE AND IN LIEU OF ALL OTHER WARRANTIES, WHETHER WRITTEN, ORAL, IMPLIED OR STATUTORY. NO IMPLIED STATUTORY WARRANTY OF MERCHANTABILITY OR FITNESS FOR PARTICULAR PURPOSE SHALL APPLY. GE does not warrant any products or services of others designated by Customer.

Subject to the provisions of this Article, GE warrants that products, services, or products and services in combination, furnished under this contract shall be delivered free of any rightful claim of any third party for infringement of any United States patent. If notified promptly in writing and given authority, information and assistance, and contingent upon Customer not taking any position adverse to GE in connection with such claim, GE shall defend, or may settle at its expense, any suit or proceeding against Customer so far as based on a claimed infringement which would result in a breach of this warranty and GE shall pay all damages and costs awarded therein against Customer due to such breach. In case any product, service or combination thereof is in such suit held to constitute such an infringement and the use of said product or service is enjoined, GE shall, at its expense and option, either procure for Customer the right to continue using said product or service, or replace same with a non-infringing product or service, or modify same so it becomes non-infringing, or remove the product or halt the service and refund the purchase price (less reasonable depreciation for any period of use) and any transportation costs separately paid by Customer. The foregoing states the entire liability of GE for patent infringement relating to products, services or any combination thereof.

The preceding paragraph shall not apply to any product or service specified by Customer or manufactured to Customer’s design, or to the use of any product in combination with products not provided by GE.

GE warrants that any software developed by GE under this contract shall conform to the GE-provided specification pertaining thereto at the time of its shipment. For a period of ninety (90) days following shipment of software, GE will provide amendments or alterations to the software that may be required to correct significant errors present at the time of shipment. GE’s obligation shall be limited, however, to assembling such amendments and/or alterations into a package, which includes code on the appropriate medium to enable Customer, at its expense, to implement said corrections. This warranty is contingent upon Customer advising GE, in writing, of such errors within such period.

GE does not warrant that operation of the software shall be uninterrupted or error-free or that it shall meet Customer’s needs. GE shall not be responsible for any portions of the software that have been modified by Customer, unless such changes are approved in writing by GE. Customer assumes the responsibility to take adequate precautions against damages to its operations that could be caused by defects, interruptions or malfunctions in the services performed by GE. Any work performed by GE due to difficulties or defects traceable to Customer errors or software changes shall be billed to Customer at GE’s then-prevailing standard rates for such services.