A rebate agreement is a legal contract that sets out the terms a company agrees to offer customers discounts on products or services in exchange for an end-user's commitment to purchase. Rebate agreements are often used in conjunction with promotional campaigns but can also be used as standalone tools.
The extra income generated from rebates typically goes towards offsetting the costs of the campaign and ensuring its success. However, some companies prefer to keep it for other purposes such as advertising.
Below is a list of common sections included in Rebate Agreements. These sections are linked to the below sample agreement for you to explore.
SUPPLY AND REBATE AGREEMENT
THIS AGREEMENT is made and effective this 22 nd day of September, 2004, between Universal Forest Products, Inc. , a Michigan corporation, with a principal place of business at 2801 East Beltline NE, Grand Rapids, Michigan 49525, for itself and its affiliates and subsidiaries, (herein “UFP”), and USA Deck, Inc. , a Delaware corporation, with its principal place of business at 1041 Cannons Court Woodbridge, Virginia 22191-1434 (herein “USA Deck”). This Agreement is based on the following:
UFP, under licensing terms contained herein, agrees to manufacture treated lumber, deck components and other building products specifically for USA Deck (“Wood Products”); and
| • | UFP agrees to sell Wood Products to, and USA Deck agrees to purchase some or all of the Wood Products from UFP for use in USA Deck’s business at USA Deck’s facilities, and shall also use the Displays, all as more specifically provided below; and |
| • | UFP has designed deck display models (the “Displays”) that could be used by USA Deck in connection with its sales of installed deck systems; and |
| • | UFP currently maintains numerous Displays in various retail stores owned and operated by The Home Depot U.S.A., Inc. (“HD Stores”), which HD Stores are located in geographical areas designated by Home Depot U.S.A., Inc. (“Market Zones”). |
1. SUPPLY OF WOOD PRODUCTS AND DISPLAYS .
A. During the term of this Agreement, UFP will sell Wood Products to USA Deck as requested by USA Deck. For the first twelve months of such sales to any particular USA Deck location, such sales shall be pursuant to a consignment agreement, the form of which is attached hereto in Appendix 1.A and which will be executed between the parties of even date herewith. Thereafter, such sales shall be standard credit sales under terms and conditions to be negotiated in good faith between the parties.
B. Upon request by USA Deck, UFP will promptly manufacture and deliver to USA Deck Displays as USA Deck requests for HD Stores located in Market Zones 75, 234, 131, 185, and 164. UFP shall invoice USA Deck up to $750.00 for each such Display provided by UFP, or such lesser amount as may otherwise be agreed to between the parties (the “Display Fee”). UFP will deliver one such Display to each applicable HD Store within the MarketZones, which delivery will include in-store set up and installation of such Displays. USA Deck shall pay the Display Fee invoices (i) over a period of 18 months from the date hereof, in equal monthly installments, or (ii) upon termination of this Agreement, whichever occurs first.
C. For the consideration set forth herein, UFP hereby transfers to USA Deck, all of UFP’s right, title, interest, possession and ownership in and to any existing kiosks, stands, advertisements or Displays, and any materials related thereto, which exist in any HD Store Market Zones 1, 45, 282, 75, 234, 131, 185, 51, 129, 164, 101 and 109 (the “Materials”). The parties agree to execute simultaneously with this Agreement, the Bill of Sale attached hereto as Appendix 2 and made a part hereof.
D. USA Deck is engaged in the modular fabrication, modular manufacture and modular design (hereinafter these proprietary processes and activities are singularly and jointly referred to as the
“Deck Process”) of prefabricated modular decks and decking products for the commercial and residential home remodeling industry. For the duration of this Agreement and upon the conditions hereinafter more specifically set forth, USA Deck hereby grants a limited non-exclusive license to Universal to utilize the Deck Process in conjunction with this Agreement for the sole purpose of providing Wood Products to USA Deck for the purposes contemplated herein. Except as otherwise set forth herein, Universal shall have no right to (i) to disclose to or permit or sublicense others to use the Deck Process; or (ii) to use the Deck Process in connection with the manufacture, use or sale of equipment or goods manufactured by Universal.
2. TERM . This Agreement shall be effective on the date written above and shall continue thereafter until terminated as provided herein. After the effective date, either party may terminate this Agreement by giving the other party thirty days written notice of its election to terminate. All the terms, conditions and provisions of this Agreement shall survive termination until all rights created or obligations incurred prior to the termination have been fully paid or otherwise satisfied.
3. REBATE . UFP shall rebate to USA Deck an amount equal to 1% of USA Deck’s purchases of Wood Products. The rebate shall be based on the amount of invoices actually paid, and shall be calculated and paid on an annual basis. Upon execution of this Agreement, UFP shall make an advance of Seventy Five Thousand Dollars ($75,000.00) against future rebates, which will be credited until actual rebates in that amount are earned by USA Deck. If this Agreement is terminated by USA Deck prior to USA Deck having earned the rebate advance, the unearned portion shall promptly be repaid to UFP.