Purchase Agreement Template

A purchase agreement template is a reusable contract that sets the terms under which a buyer purchases goods or services from a seller: what is being bought, price, delivery, inspection, warranties, payment and remedies. For B2B procurement teams, it provides consistent terms that protect the company on every significant purchase.

This guide covers the key clauses, how a purchase agreement differs from a purchase order and supply agreement and how to automate procurement approvals and signing.

What is a purchase agreement?

A purchase agreement is a binding contract for a purchase. The term covers several situations:

• B2B purchases of goods or equipment, the focus of this guide.
• Real estate purchase agreements, which follow state-specific forms and are usually handled by agents and attorneys.
• Business acquisitions, such as asset or stock purchase agreements, which require legal counsel.

For goods, US purchase agreements are generally governed by UCC Article 2, which fills gaps in the contract with default rules.

Purchase agreement vs purchase order vs supply agreement

Many companies use a master supply agreement for strategic suppliers and issue POs under it for each order.

Key clauses in a purchase agreement template

1. Parties and effective date.
2. Goods or services. Detailed description, specifications, quantities and standards.
3. Price. Unit prices, total, taxes, currency and price adjustment rules.
4. Delivery. Date, location, shipping terms, packaging and who pays freight.
5. Risk of loss and title. When responsibility and ownership pass to the buyer.
6. Inspection and acceptance. Inspection period, rejection rights and remedies for non-conforming goods.
7. Payment terms. Invoice requirements, due dates and early payment discounts.
8. Warranties. Conformity to specifications, merchantability, fitness for purpose and warranty period.
9. Remedies. Repair, replacement, refund and late delivery penalties where appropriate.
10. Indemnification. Seller protects the buyer from claims such as product liability or IP infringement.
11. Insurance. Seller’s required coverage.
12. Compliance. Laws, safety standards and supplier code of conduct.
13. Confidentiality.
14. Termination. For breach, insolvency or convenience.
15. Limitation of liability, governing law and dispute resolution.
16. Signatures.

Purchase agreement template outline

• Purchase Agreement between [Buyer] and [Seller], effective [date].
• 1. Purchase: Seller will sell and Buyer will buy the goods described in Exhibit A.
• 2. Price: [Amount], including [taxes / excluding taxes]. Prices are fixed for [term].
• 3. Delivery: Seller will deliver to [location] by [date] on [shipping terms].
• 4. Inspection: Buyer may inspect goods within [15] days of delivery and reject non-conforming goods.
• 5. Payment: Buyer will pay within [45] days of receiving a correct invoice.
• 6. Warranty: Seller warrants goods will be free from defects and conform to specifications for [24 months].
• 7. Remedies: For non-conforming goods, Seller will repair, replace or refund at Buyer’s option.
• 8. Indemnity and insurance.
• 9. Termination and 10. Governing law.
• Signatures and Exhibit A (items, specifications, quantities, prices).

Buyer-side tips

• Use your paper. Starting from the buyer’s template gives you more favorable default terms.
• Define acceptance clearly so payment ties to conforming goods.
• Tie payment to correct invoices with PO numbers.
• Include supplier compliance requirements, such as safety or sustainability standards.
• Track renewal and price adjustment dates.

Automate purchase approvals and agreements

Procurement teams can turn a manual process into a connected flow:

1. Purchase request form submitted by the requester with supplier, items and budget.
2. Approval routing by amount, department and category.
3. Purchase agreement generated from your template with supplier and line-item data.
4. Supplier signs electronically, followed by the authorized buyer.
5. PO created in the ERP with the agreed terms.
6. Agreement stored with the supplier record and renewal dates tracked.

How Noca helps

Noca connects purchase request forms, approval workflows, purchase agreement generation, e-signatures and PO creation in NetSuite, SAP, Priority or other ERPs. Start with the Noca purchase order form template.

This article is for general information and is not legal advice.

Related guides

• Sales Contract Template
• Service Agreement Template

Frequently Asked Questions

What is a purchase agreement?

A purchase agreement is a legally binding contract between a buyer and seller that sets the terms of a purchase, including the goods or services, price, delivery, inspection, warranties, payment terms and remedies. It is used for significant or complex purchases where standard purchase order terms are not enough.

What is the difference between a purchase agreement and a purchase order?

A purchase order is the buyer’s formal order for specific items, often using standard terms. A purchase agreement is a negotiated contract with detailed terms for a significant purchase or ongoing relationship. Companies often issue purchase orders under a master purchase or supply agreement.

What should be included in a purchase agreement?

A purchase agreement should include the parties, description of goods or services, price, delivery terms, risk of loss and title, inspection and acceptance, payment terms, warranties, remedies, indemnification, insurance, compliance requirements, confidentiality, termination, liability limits, governing law and signatures.

Is a purchase agreement legally binding?

Yes. Once both parties sign a purchase agreement with the essential terms, it is generally a binding contract. For sales of goods of $500 or more, UCC Article 2 generally requires a signed writing for the contract to be enforceable, with some exceptions.

Who signs a purchase agreement?

An authorized representative of the buyer, such as a procurement manager or officer with signing authority, and an authorized representative of the seller sign the purchase agreement. Many companies set signing authority limits by contract value in their approval policies.

Can purchase agreements be signed electronically?

Yes. Purchase agreements can be signed electronically in the US under the ESIGN Act and state UETA laws, and electronic records can satisfy the UCC writing requirement. E-signatures speed up procurement and create an audit trail for each approval and signature.