ASV announced Sept. 29 it has signed a five-year agreement with Caterpillar to supply undercarriages for rubber-track loaders. The companies’ original alliance contract expires Oct. 31, and the new agreement is effective Nov. 1. Key terms of the contract include:
· As with the original agreement, Caterpillar will purchase from 100 percent of its undercarriages for current and specified future multi-terrain loaders from ASV.
· If Caterpillar chooses to manufacture MTLs outside North America for non-North American markets, Caterpillar will purchase from ASV 100 percent of its undercarriages for these MTLs, provided ASV meets the capacity and local requirements for the applicable geographic area.
· Should ASV choose not to supply undercarriages to Caterpillar for non-North American sales, ASV would grant a royalty-bearing license to Caterpillar to use ASV’s intellectual property to manufacture those undercarriages.
· Caterpillar will continue to purchase 100 percent of its proprietary OEM aftermarket service parts from ASV.
· ASV will continue to be allowed to sell its rubber-track undercarriages to other equipment manufacturers for machines that do not compete with Caterpillar’s multi-terrain loaders.
· ASV will continue to use Caterpillar components in making its products.