How to review a reseller agreement

A reseller agreement lets a partner buy a vendor's products or subscriptions and resell them to its own customers. It is common in software and SaaS, where the reseller sells the subscription but the vendor runs the service. The key questions are who contracts with the end customer, who supports them, and who carries the risk if something goes wrong. This checklist covers the clauses to check and how to review the agreement in Word with LexDraft.

Last checked: 17 October 2026. The law changes; check the current position before relying on this page.

Reseller, distributor, referral partner or agent?

A reseller usually buys at a discount and resells at its own price, so it carries the credit risk on the end customer. A referral partner only introduces customers for a fee, and an agent sells in the vendor's name. Check that the label in the agreement matches what the parties actually do, because tax, antitrust and liability follow the substance. For physical products sold through a network, see our distribution agreement guide.

Clause checklist

• Appointment and scope. Products, territory, customer segments and whether the appointment is exclusive. Check whether the vendor can still sell direct.
• Pricing, discounts and margins. The reseller's buy price, discount tiers, deal registration and price changes. Resale price restrictions raise antitrust questions: minimum resale price agreements are judged under the rule of reason under federal law since Leegin Creative Leather Products, Inc. v. PSKS, Inc., 551 U.S. 877 (2007), but some states treat them more strictly.
• End-user terms. For software and SaaS, the vendor usually requires each end customer to accept its terms of service or license. Check how that happens (click-through or flow-down in the reseller's contract) and what the reseller must do if a customer refuses.
• Ordering and payment. Order forms, payment terms, and whether the reseller must pay the vendor even if the end customer does not pay the reseller.
• Support and service levels. First-line and second-line support, escalation, and who gives service credits to the end customer.
• Data protection. Who is the controller or processor for end-customer data, and whether a DPA is needed between vendor and reseller. See our DPA review guide.
• Trademarks and marketing. A limited license to use the vendor's marks, brand guidelines and approval of marketing materials.
• Franchise law risk. If the reseller uses the vendor's brand, the vendor exerts significant control or gives significant assistance, and the reseller pays a required fee (for example, a program or training fee), the arrangement may be a franchise under the FTC Franchise Rule or state law.
• Warranties, indemnities and liability. Pass-through warranties, IP infringement indemnity from the vendor, and a cap that reflects the reseller's margin. See our limitation of liability guide.
• Compliance. Anti-corruption, export controls and sanctions, especially for resellers outside the US.
• Term and termination. Termination for convenience, transition of existing end customers, and whether the reseller keeps earning on renewals after the agreement ends.

A reseller agreement review workflow in Word

LexDraft is a Word add-in from Microsoft AppSource. It opens as a side panel in Word 365 (Windows and Mac), Word 2021 and Word on the web, so the agreement never leaves the tool you already draft in.

1. Open the agreement in Word and open LexDraft in the side panel.
2. Pick the governing law. Select the state named in the governing law clause so LexDraft looks for state-specific red flags.
3. Run the review. LexDraft has four built-in playbooks (NDA, SaaS MSA, DPA and services agreement) and no dedicated reseller agreement playbook, so this runs as a general review against the governing law you chose. Use the checklist on this page to direct your own read. If the agreement is mainly a cloud subscription with resale rights, the SaaS MSA playbook covers the service terms.
4. Triage by severity. Findings are graded Critical, High, Medium or Low, and LexDraft flags standard terms that are missing.
5. Run the quick checks. The defined-term and cross-reference checks are rule-based and run without AI.
6. Accept or reject each redline. Accepted changes land as native Word tracked changes.
7. Verify and sign off. You check every output before it goes to the client or the other side.

What LexDraft does not do

LexDraft does not give legal advice or decide whether an arrangement is a franchise. Nothing changes in your document until you accept a redline.

This guide is general information, not legal advice. LexDraft does not give legal advice; qualified counsel must review every draft. Spotted something out of date? Email support@lexdraft.ai and we will fix it.