I have watched good partner recruits die in legal review. The partner owner says yes on the call, you send the agreement, and then nothing happens for eleven weeks.

Usually the problem is not the partner. It is a 28-page agreement that reads like it was written for a Fortune 500 distribution deal, sent to a 40-person VAR whose "legal department" is the owner and an outside attorney billing by the hour.

The agreement is not the program

Most ISVs I work with treat the partner agreement as the place where the entire program lives. Margins, tiers, deal registration rules, MDF, certification requirements, marketing guidelines. All of it goes into the contract.

That is a mistake for two reasons. First, every page adds review time. Second, every term you put in the contract now requires an amendment to change, and you will want to change most of it within a year.

I split it into two documents:

  • The agreement. The legal relationship. Short, stable, rarely touched.
  • The program guide. How the program works day to day. Referenced by the agreement, updated as needed with notice.

The agreement says something like "Partner will receive discounts and benefits as described in the then-current Program Guide." That one sentence saves you a lot of amendments.

What to keep in the agreement

A good VAR agreement for a mid-market ERP add-on can fit in eight to ten pages. Here is what belongs there:

  • Appointment and scope (what they can sell, in what territory if any)
  • Ordering and payment terms
  • License terms that flow down to end customers, or a reference to your EULA
  • Use of trademarks
  • Confidentiality
  • Limitation of liability and indemnification
  • Term and termination
  • Governing law

That is the skeleton. Write it in plain English where you can. VAR owners read these themselves before they pay a lawyer, and if the first page confuses them, it goes to the bottom of the pile.

The four clauses that stall legal review

In my experience, nearly every stalled agreement is stuck on one of these.

Exclusivity

ISVs sometimes ask partners not to sell competing products. Mid-market ERP VARs almost never agree to this, and they should not. They serve customers with different needs, and they carry multiple add-ons in the same category on purpose.

If you need exclusivity, you are probably asking for it because you are worried the partner will not prioritize you. A contract will not fix that. Being easier to sell will.

My default is no exclusivity in either direction. If a partner wants territory protection, I handle it through deal registration rules in the program guide, not through contract terms.

Minimums

Revenue minimums in a partner agreement are a red flag for a partner owner. They read it as "you will be terminated or penalized if this does not work out," and they push back hard, or they just never sign.

Minimums also do not work. A partner who misses a minimum by 20 percent is not going to be fired if they are your third-best partner. So the clause sits there unused, slowing down every new signature.

If you want performance expectations, put them in the tier requirements in the program guide. Hitting a number moves you up a tier. Missing it moves you down at the next review. Nobody's lawyer needs to look at that.

Intellectual property

IP clauses get ugly when ISVs write them too broadly. I have seen agreements that claim ownership of anything the partner builds that "relates to" the ISV's product. That includes the partner's own customizations, reports, and integration scripts they sell to other customers.

Implementation partners make real money on that work. A clause that grabs it will get redlined every time.

Keep it narrow. You own your product and your documentation. The partner owns what they build, and they cannot reverse engineer or redistribute your code. That covers what you actually need.

Termination

Partners care about two things here. Can you cut them off without notice, and what happens to their customers if you do?

One-sided termination for convenience with 30 days notice makes partners nervous, especially implementation firms who have put services hours into your product. Mutual termination for convenience with 90 days notice is common and rarely argued.

The bigger issue is post-termination support. Spell out that existing customers keep their licenses, and that the partner can keep supporting them for a defined period or transition them to you or another partner. Leave that vague and the partner's attorney will spend three rounds on it.

What goes in the program guide instead

Everything that will change more than once every couple of years:

  • Discount and margin schedules
  • Tier requirements and benefits
  • Deal registration process and protection periods
  • Certification and training requirements
  • MDF and co-marketing rules
  • Lead distribution
  • Not-for-resale license policies

The program guide should say up front that you can update it with 60 or 90 days notice. Partners accept this as normal, because every publisher program they already belong to works the same way.

One caution on discounts

Some partners will ask that their margin be locked in the agreement. I understand why. They have been burned by vendors who cut margin after the partner built a practice.

I usually offer a middle path. Margin lives in the program guide, but the agreement says any reduction requires 90 days notice and does not apply to registered deals already in progress. That gives the partner real protection without freezing your pricing.

Speed is a recruiting advantage

When I help an ISV rewrite their partner paper, signature time typically drops from months to a couple of weeks. That matters more than it sounds.

The partner owner's enthusiasm on the recruiting call has a short shelf life. Every week the agreement sits with their attorney, someone else's add-on is getting their attention. A short, fair agreement is not just a legal document. It is part of how you show a partner you will be easy to work with.

If your current agreement has been stuck with more than two partners for over 60 days, read it again as if you were a VAR owner. You will probably find the problem in the first ten pages.