Software Co-development Contract

This co-production software development agreement creates a legal framework for two businesses to build and promote a new software product together. It combines existing technology from each party with a defined development process and shared marketing efforts. The core project scope, technical specifications, and advertising requirements appear in Exhibit B, which functions like an applicable statement of work. This structure helps ensure clarity, align expectations, and keep both sides on the same page for project success.

Under the contract, one software company makes select content, templates, and source or object code available, while the other provides technical assistance and support services to advance the software project. Advertising and Marketing Material includes programming, coding, graphics, linking, and related collateral. Each party retains ownership of its logos, text, and other proprietary information, and confidentiality provisions protect trade secrets, with public advertising excluded from non-disclosure coverage. The parties commit to reasonable efforts and may use tracking codes to evaluate campaigns at their sole discretion.

Compensation and payment terms are defined in Exhibit A. If either party fails to pay, the other may terminate, withhold deliverables, or pursue litigation. The agreement allows continued distribution of the final product after termination, but forbids reverse engineering, derivative works, or further development of the software's code unless expressly provided.

Key clauses include indemnification for third-party rights and third-party materials, good-faith obligations, governing law and venue for disputes, and written change control for such modifications. These contract terms mitigate risks like budget overruns and non-conformity by pointing to clear acceptance criteria, acceptance testing, and detailed specifications in the exhibits.

This framework supports different contract types and models-fixed price, fixed cost, fixed budget, hourly rates, or a time and materials model-so long as the payment schedule and project budget are captured in the exhibits. It can complement a master services agreement or non-disclosure agreement when broader business relationships exist.

Typical use cases include a software developer integrating pre-existing work into a custom tool, a development partner co-branding a product with shared commercialization, or a vendor offering support services and marketing integration for a specific project.

Proposal Kit helps organizations write a robust agreement and related documents using its contract template library, document assembly, automated line-item quoting, and AI Writer to build supporting statements of work and specifications. This structured approach makes preparation straightforward and improves clear communication across stakeholders.

Beyond co-production and promotion, this legally binding agreement can operate as a software development contract that organizes software development services, support, and maintenance services around specific project details. Exhibits can define software specifications, developers' duties, the party responsible for project work, acceptance, and the payment schedule, whether the contract type is a time and materials model with hourly rates and hours tracked, or fixed price contracts with a fixed budget. Clear scope and milestones give the development team and any full-time team in-house or contractor resources a shared understanding of functionality, security, deployment, upgrades, and enhancements, while identifying warranties, responsibilities, and the timeframe to deliver in a workmanlike manner in accordance with applicable law and the rules outlined. Materials already in the public domain remain outside confidentiality, while IP ownership for source code, logos, patents, and trademarks should be addressed so each provider knows what they may implement, integrate, modify, or replace.

Business readers should expect procedures for requested change, adjustments, invoices payable in the agreed currency exchange rates, and how such notice works, time prior to termination, or a last chance to cure if issues arise. Force majeure, replacement remedies, and limitations on being liable for additional expense are often included in similar agreements to manage certain risks. Phase II and Phase III milestones can reflect progress and determine when the client approves deployment.

When negotiating, the developer agrees to manage resources, tools, and employees to achieve performance and quality goals, while each organization maintains authority to sign and ensure the arrangement is executed, interpreted, and conducted with clarity. This structure helps a dedicated team model or a flexible partnership protect great ideas and each party's secret sauce, contribute value, and increase the possibility of commercial success across countries and industries without doubt about instructions, ownership, or responsibility.

Proposal Kit supports writing and preparation by assembling a robust agreement, statements of work, and detailed specifications from an extensive template library. Its AI Writer helps outline technical topics, maintenance, and change procedures, while automated line-item quoting can reflect budgets for fixed price or time and materials models. This formal, structured approach helps teams define scope, manage money and risk, and move from idea to implementation with secure, compliant frameworks that are straightforward for stakeholders to review and sign.

For leaders planning a joint build, this legally binding agreement does more than assign tasks; it outlines how the relationship should function across the life of the project. It sets context for cooperation, identifies who supplies content and who provides technical assistance, and grants each side promotional rights while preserving protection for confidential materials. Because payments and invoices are tied to exhibits, both parties can balance investment and expected revenue against a defined duration and an approved scope. A legal professional can help with interpretation to ensure the form and procedures align with applicable laws, other agreement frameworks in place, and the parties' ability to act in accordance with their internal rules.

Operationally, the contract keeps the focus on important deliverables and a functional final product by requiring reasonable diligence, workmanlike efforts, and clear contract points. It allows tracking codes to measure progress, and it preserves IP ownership while forbidding reverse engineering, which helps maintain each party's secret sauce. In practice, teams should be prepared to manage tasks such as preparing Advertising and Marketing Material, validating identified assets, and issuing each invoice on time.

This approach supports the health of the partnership and the operation of day-to-day project work, even when circumstances change. For example, if an adjustment is needed, a written request can be documented, approved, and implemented so the agreement remains correct in detail and scope.

From a business standpoint, the agreement helps leaders explore gaps before they become complex disputes, respect the nature of co-branding, and resolve issues in a way that reflects the parties' vision. It also makes sense for organizations that hire a dedicated or in-house team to extend capacity, maintain quality, and lead deployment in a specific country or across the industry. Collectively, these clauses are vital because they define roles, preserve value, and provide a structured path to a successful proceeding and commercialization.

Proposal Kit can streamline preparation by assembling compliant documents that outline scope, advertising duties, and payment arrangements, with AI-assisted writing to capture context, tasks, and milestones in clear language. Its template library helps teams document responsibilities, grant promotional permissions, and produce well-organized forms and statements that are ready for stakeholder review and signature.

Writing the Software Co-development Contract document - The Narrative

How to Build a Legal Contract with Proposal Kit

This video illustrates how to create a legal contract using the Proposal Pack Wizard software. It also shows how to create a proposal with an invoice and contract at the same time.