SUPPLY AGREEMENT TEMPLATE FOR SOUTH AFRICA
Summary A Supply Agreement can assist you to contract with suppliers appointed to provide goods or deliver services. It sets out each party’s rights and obligations, including financial considerations and confidentiality.
Why do I need a Supply Agreement? A generic Supply Agreement sets out the terms of your relationship with your Supplier, including the terms of payment and the performance required of the supplier, and strives to protect you in case things do go wrong. It can also assist you if you need to claim damages where the Supplier defaults or if you need to withhold payment in the event that the Supplier does not perform to the required standards.
If your business appoints supplier to provide goods or to deliver services, you should consider using a written agreement to give effect to the appointment.
What does the Supply Contract say? The generic Supplier Agreement consists of: Parties; Definitions and Interpretation; Appointment and Duration; Fees; Supplier’s Responsibilities; Warranties; Restraints; Indemnity and Limitation of Liability; Breach; General.
What does the agreement look like? This template Supply Agreement can be printed onto twelve pages and is split into 3 sections:
- The Terms and Conditions of Supply;
- Confidentiality Agreement;
- Services Specification.
What do you need to do to use the Supply Agreement?
- Read the template terms and conditions to ensure that they suit your requirements. Make changes as required.
- Ensure that all the blanks have been filled in.
- Get both parties to sign the completed contract.
Also viewed: Contractor Agreement
The benefits of a Supply Agreement Template:
A supply agreement ( also known as a product supply agreement or supply contract/ supplier agreement) is a written agreement conducted in good faith between two parties involved in a business relationship that outlines the terms and conditions of the supply of goods or services by a supplier to a business such as payment condition, purchase price of materials, confidential information to be given confidential treatment and the price a party shall pay for breaking such confidentiality under this agreement and the effective date of the agreement itself.
This supply agreement template can be used to save time and establish a legally binding understanding of the business activities of both parties.
The supply agreement should specify and demand strict compliance with the products or services being supplied, the effective date, the delivery date, monthly Payment, payment schedule and any payment of disbursements incurred by the supplier in the course of obtaining such products or for the purchase price of raw materials to supply and fulfil the purchase orders to the business or other party to the supply agreement, any confidential information of either party under the supply agreement to be given confidential treatment by the other party to the supply agreement, the price or consequences of breach of confidentiality by any party to this supply agreement and the delivery schedule of the supply party. Payment terms and price to supply should also be clearly stated and agreed by each party to the supply agreement.
The parties involved should acknowledge and be of the entire understanding and agreement that the supply agreement template is governed by applicable laws and governmental authority and the agreement shall be filed separately.
Supply agreements or a supply agreement template should also include provisions for force majeure, which refers to events outside the reasonable control of either party and that may affect the supply of goods or services but is not seen as a material breach by such party.
If such an event occurs, it cannot lead to legal action but instead may offer other remedies such as that either party may terminate the agreement by way of written notice to the other party to the supply agreement and such termination will be seen as just and the business relationship will have come to an amicable end upon such notification.
Supply agreement templates generally state that if either party breaches the agreement, the other party should provide such party with notification by way of a written notice of such breach.
The supply agreement should specify what constitutes a material breach by a party to the supply agreement or supply agreements and which breaches require written notice by one party to the other party, who will be liable for legal fees in case of a breach by either party to the supply agreement, and the remedies available in such a breach to either party under the agreement.
The parties acknowledge and agree to comply with any applicable law and use commercially reasonable efforts to fulfill their obligations under the supply agreement in good faith and will provide written notice if the obligations cannot be fulfilled.
Supply agreement templates/ supply agreements should also address confidentiality and intellectual property issues. The parties should agree to keep confidential information and trade secrets confidential and to use such information solely for the purpose of performing under the agreement.
The supplier agreement or supply agreement templates also specify which information should be given confidential treatment under this supply agreement and the price a party shall of breaching such confidentiality.
The parties should also agree that the agreement and all information relating to the business relationship shall survive termination of the supplier agreement.
It is important that the Supply agreement or supply agreement templates sufficiently covers Force majeure, where one party, for instance, cannot fulfil a purchase order/purchase orders owed to the other party under the supply agreement due to an Act of God or nature and not due to a cosmetic act by either one party or the other party to this supply agreement.
In case of any legal action, the agreement shall specify the competent jurisdiction and the party prevailing in such an action may recover its legal fees, for which the other party shall be liable if both parties agree to this stipulation. It also addressed any applicable written notice between the parties to supply agreements
The parties should acknowledge that this supply agreement is not a joint venture agreement between the parties, being the business and supplier and the agreement shall not create any partnership or agency relationship between the parties to the supply agreement/ supply agreement templates.
By entering into and signing a Supplier agreement, the parties acknowledge and accepts the clauses set out within the purchase agreement such as the effective date, normal business hours, the price raw materials used to deliver the purchase order or purchase orders, governing law, force majeure, any and all applicable law that govern the product supply agreement, any personal injury, any action requiring prior written consent, agreement between parties relating to the delivery date of such products under the purchase agreement, intellectual property of the business and supplier, the information which the parties agree to give confidential treatment under the supplies agreement, the timely fulfillment of purchase orders, the price of fulfillment of purchase order/ purchase orders, the particulars of the parties to the supply/ supplier agreement, any international chamber to which either the supplier or relevant business is a party.
Supply agreements or supplier agreement between a business and supplier can either be exclusive or non exclusive, whereby the business may use any other party to supply the same products or services.
The supply/ supplier agreement template should be signed by an authorized representative of each party and the agreement shall become effective on the date to which both parties agree and as is specified in the agreement. The initial term of the agreement should also be specified.
Either party may terminate the supplier/ supply agreement with prior written consent or prior written approval and in compliance with the terms of the supplier agreement.
The supply agreement shall also state that payment to a supplier shall not be unreasonably withheld for any reason, for example in the case of force majeure where a purchase order cannot be fulfilled. This insures that a supplier doesn’t pay the price for a matter out of their reasonable control.
Each party shall acknowledge their agreement of the terms of the Supply agreement by way of signing the supply agreement.
Supply agreement templates or supply agreements protect the rights of each party and set out clear obligations as well as the price of services offered.
Supply agreement templates are legally binding and can save time and legal fees!
To simplify the process of drafting supply agreements, many businesses use supply agreement templates. These supply agreements typically include standard terms and conditions contained in all supply agreements, including those related to price. By using supply agreements that are already drafted, businesses can save time and ensure that their supply agreements are legally sound.
Overall, legally binding supply agreements are important legal document that sets out the terms and conditions of a supply contract between a business and supplier for any purchase order. The agreement shall provide a clear understanding of the rights and obligations of the parties involved and can help to prevent disputes arising from this supply agreement in the future.
Our Supply agreement Templates are easy to use and fully editable and come at a reasonable price!
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