Software Reseller Agreement: What is it? What to Include

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What is a Software Reseller Agreement?

A software reseller agreement is a legal contract between a software publisher and reseller. The agreement specifies the rights and responsibilities of each party involved in reselling the software to third parties.

Sometimes referred to as a software distribution agreement, this type of licensing agreement is created set clear legal and business terms on the obligations of both parties.

Third parties reselling software is not a new concept and it is key to make sure all terms are clearly outlined to ensure a successful relationship. Missed communication, poorly defined requirements, or loopholes could threaten even the best software resale deals, which is why it is always recommend to consult a technology lawyer when drafting or negotiating these types of agreements.

This is an article about getting the most from your software distribution agreement.

How Do You Structure a Software Reseller Agreement?

A reseller agreement for software can be structured as exclusive or non-exclusive.

• Exclusive Software Reseller Agreement: a software reseller agreement in which the reseller is the only entity legally allowed to resell or distribute the software, including the publisher and any of the publisher’s other resellers. However, it is common for an exclusive arrangement to be limited by a geographical area or industry.
• Non-Exclusive Software Reseller Agreement: Most mainstream software reseller agreements are non-exclusive. In these arrangements, the publisher is free to permit other resellers to sell the same software.

What’s Included in a Software Reseller Agreement?

Depending on the complexity, a software reseller agreement could include more specific topics, but at a minimum, it should include:

1. Applicable Law: There are some cases in which the publisher and reseller are in different countries. In these especially, there is a need to define under which jurisdiction the laws governing the agreement will be based.
2. Ownership Terms: As mentioned above, a software reseller agreement can be exclusive or non-exclusive. The publisher is the one who decides which type of agreement they want to offer, and it sometimes varies among individual sellers.
3. Intellectual Property Rights :Intellectual property rights are one of the trickiest, but most important points in a software reseller agreement. Suppose a reseller does not have express permission to use the trademark, or copyright. In that case, they could face copyright infringement or trademark infringement charges if there is a breach.
4. Payment Terms: As with many legal agreements, the financial terms should also be delineated in the software reseller agreement. If you are a reseller, this is the part you want to pay attention to. It will outline how you will be compensated.
5. Software Maintenance/Updates: Make sure you have support after the agreement. If you don’t, you could be left hanging once the agreement is signed. Typically, the SaaS publishing company is responsible for updating and maintaining software throughout the contract's lifetime. A schedule should be included.
6. Additional Services: As a reseller, if you will be responsible for end-user training, you’ll want to know ahead of time and be compensated accordingly. This should be agreed upon at the start and outlined in the software agreement.

Here is an article about some of the top software resellers in the market, according to users.