Vendor
Agreements
Your vendors and suppliers are critical to your business. We help ensure those relationships are built on clear, enforceable agreements.
🤝 Key Takeaways
- Vendor contracts protect the vendor—negotiate terms that protect your business
- Oklahoma's UCC (12A O.S. § 2-314, 2-315) provides implied warranties for goods purchases
- MSAs save time but lock in terms—negotiate the master agreement carefully
- Low liability caps can leave you without recourse when vendors fail
- SLAs define specific metrics and remedies for service failures
- Warranty disclaimers must be conspicuous and properly worded under Oklahoma law
Types of Vendor Agreements
Supply Agreements
Contracts for purchasing goods or materials. Key provisions include:
- Product specifications and quality standards
- Pricing, including volume discounts
- Delivery terms and shipping responsibility
- Inspection and acceptance procedures
- Warranties and defect remedies
- Minimum purchase commitments
Service Agreements
Contracts for ongoing professional or business services:
- Scope of services and deliverables
- Performance standards and metrics
- Personnel qualifications
- Response time requirements
- Service level agreements (SLAs)
- Reporting and communication
Master Service Agreements
Framework agreements for ongoing relationships:
- General terms that apply to all work
- Statement of Work (SOW) procedures
- Change order processes
- Pricing frameworks
Key Agreement Provisions
Performance and Quality
- Specifications – Detailed requirements for goods or services
- Acceptance criteria – How you determine if deliverables are acceptable
- Cure periods – Time for vendor to fix problems
- Credits and remedies – Compensation for failures
Risk Allocation
- Liability caps – Limits on damages either party can recover
- Indemnification – Who pays if problems arise from the work
- Insurance requirements – Coverage the vendor must maintain
- Force majeure – How to handle unforeseeable events
Intellectual Property
- Who owns work product created under the agreement
- License rights to use existing IP
- Confidentiality and trade secrets
Term and Termination
- Contract duration and renewal terms
- Termination for convenience
- Termination for cause (breach)
- Transition assistance at end of term
Working with Vendor Forms
When a vendor presents their standard contract, remember:
- Their form protects them—push back on one-sided terms
- Liability caps that are too low leave you exposed
- Warranty disclaimers may leave you without recourse
- Auto-renewal clauses can lock you in
- Indemnification provisions may be unreasonably broad
We can review vendor contracts and suggest specific revisions, or draft your own vendor agreement to use as a starting point for negotiations.
Common Vendor Agreement Mistakes
Protect yourself by avoiding these common errors:
- Accepting vendor forms as-is: Their contract protects them—negotiate changes
- Ignoring liability caps: Low caps mean you can't recover when the vendor fails
- Missing warranty terms: Disclaimer language can eliminate your rights
- Unclear acceptance criteria: Know how to reject non-conforming deliverables
- No exit strategy: Ensure you can terminate if the relationship isn't working
Frequently Asked Questions
Common questions about vendor agreements
What should be in a vendor agreement? +
Product/service description, pricing, delivery terms, quality standards, warranties, liability and indemnification, IP ownership, confidentiality, and termination rights.
Should I use the vendor's contract or my own? +
Your own is better—their contract protects them. If you must use theirs, negotiate key terms like liability caps, warranties, and termination rights.
What's a Master Service Agreement? +
An MSA establishes general terms for ongoing relationships. Individual projects use simpler Statements of Work that incorporate the MSA terms.
How do I handle vendor non-performance? +
Your options depend on contract terms. Common remedies include cure periods, credits, termination, and damages claims. Review your contract for required procedures.
What is a Service Level Agreement (SLA)? +
An SLA defines specific performance metrics (uptime, response times) and consequences for failures. Common in IT and ongoing service contracts.
What's the difference between goods and services contracts? +
Goods are covered by Oklahoma's UCC (12A O.S.) with implied warranties. Service contracts rely on common law with fewer automatic protections.
Can vendors disclaim all warranties? +
They try, but warranty disclaimers have limits. Under Oklahoma's UCC, disclaimers must be conspicuous and properly worded. We can help you push back.
What's a liability cap? +
A limit on what you can recover if the vendor fails. Low caps are common but negotiable. Ensure caps are high enough to cover your potential losses.
Protect Your Vendor Relationships
Schedule a consultation to discuss your vendor agreement needs.