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One of the consequences of a development where two or more parties have collaborated not only to produce a software product but also to continue to enhance, modify and support the same especially over a period of time, and perhaps also where further products or Applications based on that product are produced, is that the copyright in such enhancements, modifications, supporting software and documentation relating to any of the foregoing becomes less distinct unless the parties have continued to be vigilant in ascertaining ownership not only at the outset of the original development but also at each stage where copyright or ownership may come into question, e.g. prior to creating a new Application.

At some stage, the parties to such a co-operative development may each wish to exploit the fruits of the development in their own way and in order to avoid subsequent disputes as to ownership of certain parts of the developed work it is preferable for the parties to grant to each other the reciprocal right to use that part of the developed work which is or may belong to that party so that each party can exploit the whole jointly developed product.

This contract is aimed at being a short, simple but effective way of avoiding costly disputes and lengthy litigation during which neither party will benefit. However, it also provides that neither party will be liable to the other for loss or damage suffered by the other in exercise of such reciprocal rights. This is fair where there is no competition between the parties in the same market.
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