Drafting an IT Reseller Agreement – Price, Orders and Invoicing clause

As a distributor, your IT Reseller Agreement should set out the relationship between the reseller and yourself and the terms on which the software will be resold. As a reseller, you should ensure that any IT Reseller Agreement you are provided with has been reviewed by a lawyer, preferably someone with IT experience who would understand the terminology.

Prices, orders and fees

As a distributor, your IT Reseller Agreement should set out the prices that the product can be resold at, how orders can be placed, and how fees should be paid by the reseller. Your price, orders and invoicing clause of your IT Reseller Agreement should set out that the reseller agrees to buy your product at the price set out by you. If you are the distributor, you should ensure that you are able to change the price of your products, and if you are the reseller, you should ensure that if the prices are changed, you are notified. Wholesale and retail prices (if applicable) should be set out clearly in the IT Reseller Agreement.

Usually the price agreed upon may be changed later where the distributor provides an updated price list to the reseller. This clause should also set out in detail how orders are placed with the distributor, how orders are taken, in what form payment will be accepted, and the invoice terms for payment. If you are the distributor, then you should be under no obligation to provide the software to the reseller or the client (if that is how your software is provided) until payment is received for the software. As a reseller, you should make sure there is a clause included in which the distributor must ensure that the software is available to download, that it will supply the software to comply with any applicable legislation or standards and will make sure that the software is in a form that is suitable to be resold by the reseller.

As a distributor, you should set out that the reseller agrees to pay the price that is specified at the time that the reseller places its order. You should also include a clause that allowing you to amend, from time to time, your pricing structure or payment methods. You should be able to engage debt collection services for the collection of unpaid payments and debts, and have the right to commence legal proceedings for any outstanding amounts owed to you.

As a distributor you should ensure that the reseller will be liable for, and will pay all costs relating to, attempting to get payment, including debt collection, commission, solicitor’s fees and any out-of-pocket expenses related to debt collection and legal expenses.

Conclusion

Having a thorough and detailed IT Reseller Agreement that includes a strong payment and invoicing clause can reduce issues between the parties later on. We can also assist you with a variety of other IT Agreements, such as client agreements and SaaS agreements. So if you’re in need of legal advice in relation to software or IT, contact LegalVision on 1300 544 755 and speak with one of our experienced IT solicitors today.