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Resale Price Maintenance (RPM) Agreement
Practical Law Glossary Item 0-502-2214 (Approx. 3 pages)
Glossary
Resale Price Maintenance (RPM) Agreement
An agreement between a supplier and its distributors that limits the prices the distributors can charge customers for the supplier's products. Types of RPM agreements include:
- A minimum RPM agreement, in which a distributor agrees not to sell the product for less than a set minimum price (known as a "price floor").
- A maximum RPM agreement, in which a distributor agrees not to sell the product for more than a set maximum price (known as a "price ceiling").
Both minimum RPM agreements and, to a lesser extent, maximum RPM agreements may, in certain circumstances, violate federal or state antitrust laws. For more information, see Practice Note, Vertical Price Restraints.