I have prospect HD. I capture via hdlink and create cineform AVI files, then I send the project (footage included) to my co-worker who also edits on premiere. Do they need cineform?

As I understand it, they need to install a trial version of something Cineform. The decoder remains active for ever and ever, so they will always be able to play Cineform files, but once the trial expires they won't be able to encode or capture or export to Cineform unless they acquire a license. So in that case they could return an edl or project file to you who has a license if that were necessary.

Neoplayer is free and will do the job you want