# The Fractional CPO Engagement Standard
### Open template v1.1 · CC BY 4.0

**What this is.** A reference agreement for engaging a fractional Chief
Product Officer. It exists because fractional engagements keep failing on
the same four points: undefined decision rights, hours treated as a
meter, scope documents that quietly become performance guarantees, and no
plan for how the engagement ends.

**What this is not.** This is not legal advice, and it is not a document
to sign as-is. Every bracketed field is a decision. Have a lawyer review
**the entire agreement**, not selected sections, against the law of the
jurisdiction that will govern it. Employment status, data protection,
restraint of trade and limitation of liability all vary sharply by
country, and a clause that is standard in one is void in another.

**How to read it.** Numbered clauses are operative. Blocks marked
**Commentary** explain the reasoning and are **not part of the
agreement**; delete them before signature, or keep them and exclude them
expressly in §11.2.

**Neutrality.** This standard states no rates, bands or market figures.
Commercial terms are for the parties.

---

## 1. Parties and Engagement

1.1 This agreement is between **[Company legal name]**, registered in
**[jurisdiction]** under number **[number]** ("Company"), and
**[Executive legal name or entity]**, registered in **[jurisdiction]**
under number **[number]** ("Executive"), effective **[date]**.

1.2 **Engagement structure.** The Executive serves as **Fractional Chief
Product Officer**, an independent contractor providing part time, ongoing
product leadership. Nothing here creates employment, partnership, agency
or exclusivity. The Executive maintains other clients, and the Company
acknowledges this is inherent to the fractional model.

1.3 **Named individual.** The services are performed by **[name]**. The
Executive may substitute an equivalently qualified individual with the
Company's prior written consent, not to be unreasonably withheld, and
remains responsible for the substitute's performance.

1.4 **Contractor mechanics.** The Executive controls the manner and hours
of performance subject to §3, supplies its own equipment, is responsible
for its own taxes and contributions, receives no employee benefits, and
is not part of the Company's HR, performance-review or disciplinary
processes.

1.5 **Status.** The parties will allocate, in **[§1.6 / a schedule]**,
responsibility for any liability arising from a determination that the
relationship constitutes employment or deemed employment.

> **Commentary.** §1.4 is not decoration. In the UK the off-payroll rules
> and in parts of the US the ABC test look at the substance of the
> relationship, not its label. A fractional CPO who runs a fixed weekly
> session and coaches an internal team sits close to the line, and a
> bare "independent contractor" recital does not settle it. §1.3 cuts
> both ways: a substitution right helps on status, and most companies
> engage a specific person and will want it narrowed. Decide
> deliberately rather than inheriting the default.

## 2. Fees, Taxes and Payment

2.1 **Retainer.** **[currency] [amount]** per month for a planning band
of **[range]** hours per month, delivered per §3. The retainer is a fixed
monthly fee, not an hourly rate.

2.2 **Invoicing.** Invoiced **[at the start of each month]**, payable
within **[number]** days.

2.3 **Taxes.** Fees are exclusive of VAT, sales tax, GST and similar
taxes. If law requires the Company to withhold, the parties specify here
whether the payment is grossed up: **[gross-up / no gross-up]**.

2.4 **Late payment.** Overdue amounts carry interest at **[rate or the
applicable statutory rate]**. The Executive may suspend services after
**[number]** days past due, on written notice.

2.5 **Fee review.** Fees are fixed for the initial term. Afterwards
either party may propose an adjustment on **[number]** days notice,
taking effect from the start of the first month beginning after that
notice expires.

2.6 **Expenses.** Pre-approved, at cost, invoiced monthly. Travel beyond
**[city or remote norm]** requires written approval.

2.7 **Third party costs.** Research panels, participant incentives,
tooling and similar third party costs are **[the Company's / shared as
follows]** and are not funded from the retainer.

> **Commentary.** §2.3 and §2.7 are the two most commonly omitted
> commercial clauses in fractional agreements, and both cost real money.
> Cross-border engagements attract withholding tax in a number of
> jurisdictions, and silence means the executive absorbs it. §2.7 matters
> because customer research is the standard first move of a fractional
> CPO and it has a budget attached.

## 3. Time, Availability and Overage

3.1 **Working pattern.** A fixed weekly leadership session plus
asynchronous availability with a **[range]** hour response norm on
business days, measured by the public holidays of **[location]**.

3.2 **Planning band.** The monthly hour band is a good faith planning
envelope for a fixed fee, not a metered entitlement. Individual months
may vary by up to **[percentage]** without adjustment. Unused hours do
not accrue or carry forward.

3.3 **Sustained overage.** Where actual time exceeds the upper bound for
two consecutive months, either party may require a scope review. If the
parties do not agree revised scope or fees within **[number]** days, the
Executive may limit delivery to the upper bound of the band, or
terminate on **[number]** days notice.

3.4 **Additional work.** Work outside §4 is chargeable only if agreed in
writing in advance, at **[rate or separately agreed fee]**.

3.5 **Absence.** The Executive may take up to **[number]** business days
of absence in any twelve month period on **[number]** business days
notice, **[without / with]** a reduction in fees, arranging cover for
time-critical matters.

> **Commentary.** "Not a meter" is the right principle and a poor clause
> on its own. §3.3 gives the principle an ending: a review, a deadline,
> and a defined outcome if the review fails. Without that last part, a
> promise not to invoice for overage is a one-way commitment. §3.5 exists
> because fractional executives take holidays and the question is better
> answered on paper than in a difficult conversation.

## 4. Scope of Services

4.1 **The Executive owns**, at leadership altitude: product strategy and
its exclusions, prioritization decisions within the agreed strategy, the
product decision process, customer-evidence direction, and coaching of
the internal product team.

4.2 **The Executive advises, the Company decides**: hiring and
compensation, pricing, fundraising narrative, and changes to the strategy
itself.

4.3 **Out of scope**: day to day execution (tickets, specifications,
ceremonies) beyond coaching; people-management authority unless
separately agreed in writing; and legal, tax, financial or regulatory
advice.

4.4 **Company dependencies.** Delivery depends on timely access to the
Company's team, data, systems and decision makers, and on the Company
executing its own decisions.

4.5 **Scope of Work and precedence.** Detailed outcomes, decision rights
and deliverables live in the attached **Scope of Work**, which governs
the description of services and deliverables. **This agreement governs
all legal and commercial terms and controls in the event of conflict.**
Outcomes, metrics and targets in the Scope of Work are good faith
objectives, not guarantees or conditions of payment. The Scope of Work
may be amended only in writing signed by both parties.

> **Commentary.** §4.1 to §4.3 are the heart of this standard. Most
> fractional engagements fail on decision rights rather than on
> deliverables, and writing down who owns what, who advises, and what is
> out of scope removes the argument before it starts.
>
> §4.5 fixes a trap that appears in most versions of this document in the
> wild. A scope document written to win the engagement usually contains
> metric targets. If the scope document is given blanket precedence,
> those targets become contractual promises and sit in direct conflict
> with the warranty clause. Split it: scope wins on what is delivered,
> the agreement wins on everything legal.

## 5. Term and Termination

5.1 **Initial term.** **[number]** months minimum, then month to month.

5.2 **Termination for convenience.** **[The initial term may not be
terminated for convenience.]** After the initial term, either party may
terminate on **[number]** days written notice, effective at the end of
the calendar month in which the notice period expires.

5.3 **Termination for cause.** Immediately on written notice for: a
material breach uncured within **[number]** days of notice; non-payment
of an undisputed invoice beyond **[number]** days past due; insolvency;
or conduct that is fraudulent, unlawful or likely to cause serious
reputational harm.

5.4 **Early termination in the initial term.** The parties specify here
what is payable if the Company terminates during the initial term other
than for cause: **[full fees for the initial term / a stated sum /
nothing]**.

5.5 **Fees earned.** Fees earned or accrued to the effective date remain
due.

5.6 **Survival.** §1.4, §1.5, §2 for outstanding amounts, §5, §6, §7,
§8, §9, §10 and §11 survive.

> **Commentary.** A minimum term with no §5.4 is decorative. If a company
> can walk in month two at no cost, the minimum term protects nothing,
> and the executive has front-loaded the work that a minimum term exists
> to fund. State the consequence, in either direction, rather than
> leaving it to argument. Note that a stated sum must be a genuine
> pre-estimate of loss in some jurisdictions or it risks being
> unenforceable as a penalty.
>
> §5.6 is the clause most often written from memory and most often wrong.
> Check that every clause with post-term effect appears in it,
> particularly non-solicitation and handover.

## 6. Intellectual Property

6.1 **Work product.** "Work Product" means deliverables created
specifically for the Company under this agreement, excluding Background
IP. On payment in full, the Executive assigns the Work Product to the
Company and, so far as law allows, waives moral rights in it. Until
payment, the Company holds a revocable licence to use it internally.

6.2 **Background IP.** The Executive retains pre-existing and
independently developed materials, methods, frameworks and templates. The
Company receives a perpetual, non-exclusive, non-transferable and
non-sublicensable licence to use them as embedded in the Work Product,
for its internal business purposes only.

6.3 **Residual knowledge.** The Executive may use the general skills,
know-how and patterns retained in the unaided memory of its personnel,
provided it discloses no Confidential Information and identifies no
client. This right is not limited by §7.

6.4 **Publicity.** The Executive **[may / may not]** name the Company as
a client and use its name and logo for that purpose. Case studies,
testimonials, named metrics and quotations require the Company's prior
written approval.

> **Commentary.** §6.3 is the clause that makes §6.2 work. "Anonymized
> learnings may inform future work, subject to confidentiality" reads
> generously and grants almost nothing, because a pattern derived from
> confidential information is still confidential. A residuals clause
> drawn in the standard form, unaided memory and no identifying detail,
> states the boundary in a way both sides can apply.
>
> §6.4 is a commercial term dressed as a legal one. Silence means no
> naming right at all, which for an independent practitioner removes the
> main non-cash benefit of the engagement.

## 7. Confidentiality and Data

7.1 Each party protects the other's non-public information with at least
the care it applies to its own and no less than reasonable care, and uses
it only for this engagement.

7.2 **Exclusions.** Information public through no fault, already known
free of obligation, independently developed, or lawfully received from a
third party.

7.3 **Permitted recipients.** Personnel, professional advisers, insurers
and subcontractors who need to know and are bound by equivalent
obligations.

7.4 **Compelled disclosure.** Permitted to the extent required by law,
court order or regulator, with notice to the other party where lawful.

7.5 **Tools and AI systems.** The Executive may use standard commercial
software, cloud services and AI-assisted tools, provided each is subject
to contractual confidentiality terms and does not permit the provider to
train generally-available models on Confidential Information. The
Executive remains responsible for all output. Specific tool restrictions
must be notified in writing and, where they materially change delivery,
are treated as a scope change under §4.5.

7.6 **Return and destruction.** On termination, return or destroy on
written request, excepting routine backups, professional records and
legally required retention.

7.7 **Term.** Survives **[number]** years, and indefinitely for trade
secrets.

7.8 **Personal data.** The parties record here whether the Executive
processes personal data on the Company's behalf: **[the Executive does
not process personal data on the Company's behalf; access is incidental
and under the Company's instructions]**. If processing on the Company's
behalf occurs or begins, the parties will execute a data processing
agreement meeting the requirements of Article 28 of the EU and UK GDPR,
or equivalent applicable law, before that processing begins.

> **Commentary.** A sentence saying the parties will comply with
> applicable data protection law does not satisfy Article 28, which
> prescribes specific mandatory terms for any processor. For most
> fractional CPO engagements the honest answer is that the executive is
> not a processor at all, and saying so plainly is both accurate and
> safer than a vague gesture at compliance. Say which it is, and add the
> trigger.
>
> §7.5 is new in v1.1 and will date faster than anything else here.
> Fractional executives work with AI tooling, and an increasing number of
> corporate templates now prohibit it outright. An engagement built on a
> prohibition nobody can honour is worse than one that states the
> controls.

## 8. Conflicts and Non-Solicitation

8.1 **Competitors.** The Executive will not, during the engagement,
serve as fractional product leader to a direct competitor of the
Company. The parties define this **[by naming up to [number] specific
companies in Schedule A / by the following definition, scoped to segment
and buyer, not to industry: [definition]]**, and may update it only by
written agreement.

8.2 **Post-term.** The parties state expressly whether any post-term
restraint applies: **[none / [terms]]**.

8.3 **Non-solicitation.** Neither party knowingly solicits the other's
employees or contractors during the engagement and for **[number]**
months after, excluding general advertising not targeted at them and
approaches made on the individual's own initiative.

> **Commentary.** An abstract competitor definition is the single most
> dangerous placeholder in this document. Left open, it is filled in
> broadly, and a broad definition is incompatible with a fractional
> practice that serves several clients in one vertical. A named list of
> a handful of companies is easier to agree, easier to police, and gives
> the company the protection it actually wants. Note also that post-term
> non-competes are unenforceable in some jurisdictions, including
> California, and tightly restricted in many others.

## 9. Warranties, Liability and Insurance

9.1 **Warranty.** The Executive performs the services with reasonable
skill and care consistent with the standards of a suitably qualified and
experienced product leader. The Company acknowledges that outcomes depend
on its own execution, resourcing and market conditions, and no commercial
or product outcome is guaranteed.

9.2 **Disclaimer.** Except as stated in §9.1, implied warranties and
conditions are excluded to the extent permitted by law.

9.3 **Cap.** Subject to §9.4 and §9.5, each party's aggregate liability
is capped at fees paid or payable in the **[number]** months preceding
the first event giving rise to the claim. Neither party is liable for
indirect or consequential loss, or for loss of profit, revenue, business,
goodwill or data.

9.4 **Elevated cap.** Liability for breach of §6 or §7 is capped at fees
paid or payable in the **[larger number]** months preceding the first
event giving rise to the claim.

9.5 **Exclusions from the cap.** Fraud, willful misconduct, death or
personal injury caused by negligence, the obligation to pay fees, the
indemnities, and any liability that cannot lawfully be limited.

9.6 **Indemnities.** The Executive indemnifies the Company against third
party intellectual property claims arising from the Work Product as
delivered and used per this agreement, subject to §9.4. The Company
indemnifies the Executive against third party claims arising from the
Company's business, products, instructions and handling of personal data.

9.7 **Insurance.** The Executive maintains professional indemnity
insurance of not less than **[amount]** per claim for the term and
**[number]** years after, with evidence of cover on request.

> **Commentary.** §9.4 is the most consequential change in v1.1. Making
> confidentiality and IP breaches fully uncapped, which is what most
> versions of this clause do, removes the cap for precisely the claim
> most likely to be brought against a fractional executive, who by
> definition handles several companies' information. An elevated cap
> keeps the company meaningfully protected while leaving the executive an
> insurable, finite exposure. Reserve genuinely uncapped treatment for
> fraud and willful misconduct.
>
> If a clause promises insurance, the agreement needs an insurance
> clause. §9.7 exists because a heading that mentions cover with no
> corresponding obligation is a drafting error that counterparties
> notice.

## 10. Handover

10.1 Fractional done well ends deliberately. On wind-down, the Executive
delivers the documented strategy, the running decision process, the open
decision log, and where relevant the hiring profile for a successor,
within the final month's hours and prioritized over new work.

10.2 A **[range]** hour transition session with the successor or founder
is included in the final month. Handover beyond the final month's band is
chargeable under §3.4.

10.3 §10 applies where the Company is current on all undisputed invoices,
and **[does / does not]** apply where the Executive terminates for cause.

> **Commentary.** This clause is the point of the standard. An engagement
> designed to end well is worth more than one designed to continue, and a
> named, scoped, funded handover is the difference between institutional
> knowledge and a departed consultant. Confirm §10 appears in the
> survival list; it is a post-term obligation and it is routinely left
> out.

## 11. General

11.1 **Governing law and disputes.** Governed by the law of
**[jurisdiction]**. Disputes go first to good faith discussion between
principals within **[number]** days, then to **[mediation / arbitration /
the courts of [jurisdiction]]**. Either party may seek injunctive relief
in any competent court to protect confidential information or
intellectual property.

11.2 **Entire agreement.** This agreement and the Scope of Work are the
entire agreement. Commentary blocks in this template are explanatory and
form no part of it. Nothing excludes liability for fraudulent
misrepresentation.

11.3 **Amendments and waiver.** In writing, signed by both parties.
Unilaterally imposed purchase order or portal terms do not apply. Delay
in enforcing a right is not a waiver.

11.4 **Assignment and change of control.** No assignment without
consent, except to a party's own service entity or to an acquirer of
substantially all of its business. State whether a change of control
gives either party a termination right: **[terms]**.

11.5 **Force majeure.** No liability for delay caused by events beyond
reasonable control, with prompt notice. Payment obligations are not
excused.

11.6 **Severability.** Unenforceable provisions are modified to the
minimum extent necessary or severed.

11.7 **Third party rights.** No third party may enforce this agreement.

11.8 **Notices.** By email to the addresses in the signature block,
deemed received the next business day, with termination and breach
notices also sent to the registered addresses in §1.1.

11.9 **Counterparts.** May be signed in counterparts and by electronic
signature.

> **Commentary.** Choose the forum with enforcement cost in mind. On an
> engagement of this size, litigating in a distant jurisdiction costs
> more than the contract is worth, which in practice means the clause
> decides who can realistically bring a claim at all. Where the parties
> are in different countries, remote arbitration or mediation is usually
> a fairer compromise than either side's home courts.

---

## Signatures

**Company: [legal name]**

Signature: ______________________
Name: ______________________
Title: ______________________
Date: ______________________
Notice email: ______________________
Registered address: ______________________

**Executive: [legal name]**

Signature: ______________________
Name: ______________________
Title: ______________________
Date: ______________________
Notice email: ______________________
Registered address: ______________________

---

## Licence and attribution

Published as an open engagement standard. Licensed **CC BY 4.0**: reuse,
adapt and distribute freely with attribution to **saasfractionalcpo.com**.

Adaptations must not suggest endorsement by, or affiliation with,
saasfractionalcpo.com or its author.

Provided **as is**, without warranties of any kind, per section 5 of the
CC BY 4.0 licence. This template is not legal advice and creates no
lawyer-client relationship. Nobody has reviewed it against your
jurisdiction, your engagement or your risk. Have a lawyer do that.

*Changelog v1.0 to v1.1: added contractor-status mechanics, tax and
withholding, late payment and suspension, an overage remedy, an absence
clause, scope-of-work precedence, an early-termination consequence, a
corrected survival list, residual knowledge, publicity, permitted
recipients, compelled disclosure, an AI tooling clause, an Article 28
trigger, a named-competitor option, an elevated liability cap for IP and
confidentiality, indemnities, insurance, handover conditions, force
majeure, severability, third party rights, counterparts, and a complete
signature block.*