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((refimprove|date=March 2017))
((Contract law))
An '''output contract''' is an [[contract|agreement]] in which a producer agrees to sell his or her entire production to the buyer, who in turn agrees to purchase the entire output. Example: an almond grower enters into an ''output contract'' with an almond packer: thus the producer has a "home" for output of nuts, and the packer of nuts is happy to try the particular product. The converse of this situation is a [[requirements contract]], under which a seller agrees to supply the buyer with as much of a good or service as the buyer wants, in exchange for the buyer's agreement not to buy that good or service elsewhere.

[[Uniform Commercial Code]] comment section 2-306: A term which measures the quantity by the output of the seller or the requirements of the buyer, means such actual output or requirements that may occur in good faith. [[Good faith]] cessation of production terminates any further obligations thereunder and excuses further performance by the party discontinuing production. However, the cessation of production must be in light of [[bankruptcy]] or other similar situations. The yield of less profit from a sale than expected does not excuse further performance of an output contract. See Feld vs. Henry S. Levy & Sons, Inc. (New York, 1975)<ref>[http://www.casebriefs.com/blog/law/commercial-law/commercial-law-keyed-to-lopucki/performance/feld-v-henry-s-levy-sons-inc/ Brief at CaseBriefs.com]</ref><ref>[http://www.leagle.com/decision/197476545AD2d720_2489/FELD%20v.%20HENRY%20S.%20LEVY%20&%20SONS,%20INC. Full Case at Legal.com]</ref> or Technical Assistance International, Inc. vs. United States (U.S. Court of Appeals, 1998).<ref>[https://caselaw.findlaw.com/us-federal-circuit/1397107.html full case at findlaw.com]</ref>

==References==
((Reflist))

[[Category:Business law]]
[[Category:Contract law]]


((business-stub))

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