Development Agreement - Pro Customer

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MASTER DEVELOPMENT AGREEMENT

MASTER DEVELOPMENT AGREEMENT (the “Agreement”) dated as of ___________, 20__ by and between [Customer] (hereinafter “Customer”), a Delaware corporation and the developer executing this agreement below (hereinafter “Supplier”):

RECITALS:

WHEREAS, Customer desires to engage Supplier from time to time pursuant to one or more Statements of Work (SOWs) to develop, create, test, and deliver certain programming materials as works made for hire, and Supplier is interested in accepting such engagements, subject to the parties' further agreement on the scope and terms of each such SOW; and

WHEREAS, Customer and Supplier mutually desire to set forth in this Agreement certain terms applicable to all such engagements;

AGREEMENT

NOW, THEREFORE, Customer and Supplier, intending to be legally bound, hereby agree as follows:

1.                  DEFINITIONS»

.  When used in this Agreement and in each SOW issued hereunder, the capitalized terms listed in this Section 1 shall have the following meanings:

“Code” means computer programming code. If not otherwise specified, Code includes both Object Code and Source Code. Code includes any Maintenance Modifications or Basic Enhancements to the Code created by Supplier, and includes Major Enhancements when added to the Code in connection with a SOW issued under this Agreement.  “Object Code” means the machine-readable form of the Code.  “Source Code” means the human-readable form of the Code and related system documentation including all comments and any procedural code such as job control language.

“Deliverables” means all Code, Documentation, and other materials developed for or delivered to Customer by Supplier under this Agreement and under any SOW issued under this Agreement.

“Derivative Work” means a work that is based upon one or more preexisting works, such as a revision, modification, translation, abridgement, condensation, expansion, or any other form in which such preexisting works may be recast, transformed, or adapted, and that, if prepared without authorization of the owner of the copyright in such preexisting work, would constitute a copyright infringement. For purposes hereof, a Derivative Work also includes any compilation that incorporates such a preexisting work.

“Documentation” means user manuals and other written materials that relate to particular Code, including materials useful for design (e.g., logic manuals, flow charts, and principles of operation).  Documentation includes any Maintenance Modifications or Basic Enhancements to the Documentation created by Supplier, and includes Major Enhancements when added to the Documentation in connection with a SOW issued under this Agreement.

“Enhancements” means changes or additions, other than Maintenance Modifications, to Code and related Documentation, including all new releases, that improve functions, add new functions, or significantly improve performance by changes in system design or coding.  “Basic Enhancements” means any Enhancements that are not Major Enhancements.  “Major Enhancements” means changes or additions to Code and related Documentation that (1) have a value and utility separate from the use of the Code and Documentation; (2) as a practical matter, may be priced and offered separately from the Code and Documentation; and (3) are not made available to any of Supplier's customers without separate charge.

“Error” means any error, problem, or defect resulting from (1) an incorrect functioning of Code, or (2) an incorrect or incomplete statement of diagram in Documentation, if such an error, problem, or defect renders the Code inoperable, causes the Code to fail to meet the specifications thereof, causes the Documentation to be inaccurate or incomplete in any material respect, causes incorrect results, or causes incorrect functions to occur when any such materials are used.

“Maintenance Modifications” means any modifications or revisions, other than Enhancements, to Code or Documentation that correct Errors, support new releases of the operating systems with which the Code is designed to operate, support new input/output (I/O) devices, or provide other incidental updates and corrections.

“SOW” or “Statement of Work” means a purchase offer of Customer, a proposal of Supplier, or another written instrument that meets the following requirements:  (1) includes substantially the following statement: “This is a SOW under Master Development Agreement No. ..... .”; (2) is signed on behalf of both parties by their authorized representatives; (3) contains the following four mandatory items: (a) description and/or specifications of the services to be performed and the Deliverables to be delivered to Customer; (b) the amount, schedule, and method of payment; (c) the time schedule for performance and for delivery of the Deliverables; and (d) completion and acceptance criteria for the Deliverables.  In addition, when applicable, the SOW may include: (1)  provisions for written and/or oral progress reports by the Supplier; (2) detailed functional and technical specifications and standards for all services and Deliverables, including quality standards; (3) documentation standards; (4) lists of any special equipment to be procured by Supplier or provided by Customer for use in performance of the work; (5) test plans and scripts; and (6) Such other terms and conditions as may be mutually agreeable between parties

2.                  CONTRACT ADMINISTRATION; CHANGES»

.  The initial SOW(s) agreed to by the parties are set forth as attachments to this Agreement. Additional SOWs, regardless of whether they relate to the same subject matter as the initial SOW(s), shall become effective upon execution by authorized representatives of both parties.  Changes in any SOW or in any of the Specifications or Deliverables under any SOW shall become effective only when a written change request is executed by authorized representatives of both parties.   Supplier may not decline to accept any change requests that reduce the cost of performance, provided that an equitable adjustment in compensation is made for the out-of-pocket costs of any performance or preparation already undertaken. Supplier further may not decline any change requests that increase the cost or magnitude of performance, provided that the changes are reasonable in scope and a commensurate increase in compensation is fixed.

3.                  COMPENSATION»

.  Amounts and modes of payment for all services to be performed and Deliverables shall be set forth in each SOW. The parties shall agree to use one of the modes of payment set forth in Sections 3.1, 3.2 or 3.3. No royalty or profit-sharing whatsoever is to be provided to Supplier for the Deliverables.  Supplier shall have sole responsibility for the payment of all taxes and duties imposed by all governmental entities, as they pertain to its duties, obligations, and performance under this Agreement.  Except as expressly agreed otherwise by Customer in a SOW, Supplier shall bear all of its own expenses arising from its performance of its obligations under this Agreement and each SOW issued hereunder, including (without limitation) expenses for facilities, work spaces, utilities, management, clerical and reproduction services, supplies, and the like.  Notwithstanding the following, Supplier agrees that the charges established under this Agreement and all SOWs issued hereunder shall not exceed those offered or imposed with respect to similar services provided to other customers of Supplier. If, during the term of this Agreement, Supplier offers or accepts lower charges for similar services involving other customers under similar terms and conditions, Supplier shall so notify Customer and remit as a credit to Customer the differences between the amount of the payments theretofore made by Customer for such similar services and the amount that would have been payable if such lower charges had been in effect.

3.1              Fixed Price»

.  If Supplier quotes a price for particular services or Deliverables and such price is specified without qualification in the applicable SOW, the amount quoted shall be deemed a fixed price. Unless the SOW provides for progress payments or deferral of payment after completion, Customer shall pay the full amount of the fixed price upon Supplier's satisfactory completion of the specified services or upon Customer's acceptance of particular Deliverables. A SOW may alternatively provide for payment to be based on a fixed priced for certain services to be rendered over a specified period of time. Unless otherwise specified in the SOW, such payment for periodic services shall accrue on a monthly basis and be prorated for any partial periods.

3.2              Time and Materials»

.  For services and Deliverables that are not suitable for payment on the basis of a fixed price, the SOW may provide for payment on the basis of time and materials. Payment under this method shall be determined according to the hourly rates set for Supplier's employees by skill level in the Statement of Rates set forth in Exhibit A attached hereto. The Statement of Rates differentiates the employees of Supplier assigned to SOWs issued hereunder according to their skill level as a “designer architect,” “software engineer,” “programmer,” “programmer trainee,” “administrative support clerk,” or “technical writer.” Customer shall have the right to challenge the classification of any particular employee by review of such employee's work experience, training, and performance. If the parties cannot decide upon a mutually agreeable classification of any such employee, Supplier shall not assign such employee to any of the SOWs issued hereunder.

3.3              Time and Materials Subject to Fixed Ceiling»

.  For certain SOWs, time and materials charges pursuant to the Statement of Rates may be authorized subject to a maximum aggregate amount, designated as the “level of effort” expected or imposed for particular services or Deliverables. Supplier shall use all reasonable effort to complete the specified services and/or Deliverables for no more than such aggregate amount. Further, should Supplier determine at any time that it may be necessary to exceed such aggregate amount, Supplier shall immediately notify Customer in writing. In such notice, Supplier shall set forth Supplier's best estimate of the cost to complete the pertinent services and/or Deliverables. Following receipt of such notice, Customer shall either instruct Supplier to halt work with respect to such services and/or Deliverables, to continue on a time and material basis, or to suspend work pending further negotiation of a fixed price for completion.

3.4              Statement of Rates»

.  The hourly rates prescribed by the Statement of Rates shall be in lieu of compensation or reimbursement for any costs or burden incurred by Supplier, including (without limitation) occupancy, supplies, utilities, payroll, management, and overhead.  Rates quoted by Supplier in its Statement of Rates are subject to change upon 60 days' advance notice, provided that any such change shall have no effect upon rates or charges for work already rendered or scheduled to be rendered within six months of the issuance of such notice.

4.                  INVOICING; RECORDS»

.  Supplier shall submit invoices to Customer for payment for work and/or Deliverables at such time or times as payment becomes due under each SOW. Invoices shall be net 30 days, and shall be submitted no more frequently than monthly for charges due or accruing in each calendar month. All invoices shall specifically refer to the SOW to which they relate. Whenever an invoice includes charges for time and materials, the invoice shall indicate the names, skill levels, and hours of the employees performing the work. Each invoice shall separately set forth travel expenses, if any, authorized by Customer for reimbursement. Supporting documentation (e.g., receipts for air travel, hotels, and rental cars) called for by Customer's standard reimbursement policies shall accompany any such invoice. Any extraneous terms on Supplier's invoices shall be void and of no effect.  Supplier shall maintain complete and accurate accounting records in accordance with sound accounting practices to substantiate Supplier's charges under each SOW and on each invoice. Such records shall include payroll records, job cards, attendance cards, and job summaries. Supplier shall preserve such records for a period of at least two years after completion of the pertinent work. Customer shall have access to such records for purposes of audit, either through its own representatives or through an accounting firm selected and paid by Customer. Any such review of Supplier's records shall be conducted at reasonable times during business hours.

5.                  DELIVERY AND ACCEPTANCE»

.  Supplier shall deliver all Deliverables, upon completion, to Customer's for testing and acceptance. Unless a different procedure for testing and acceptance is set forth in a SOW, Customer shall commence acceptance testing following its receipt of the Deliverables. Upon completion of such testing, Customer shall issue to Supplier notice of acceptance or rejection of the Deliverables. In the event of rejection, Customer shall give its reasons for rejection to Supplier in reasonable detail. Supplier shall use all reasonable effort to correct any deficiencies or nonconformities and resubmit the rejected items as promptly as possible.  If Customer finds such re-submitted items to be unacceptable, Customer shall be entitled at its option (i) to terminate this Agreement and receive a refund for any amounts paid hereunder, (ii) terminate development of the specified Deliverable and receive a refund for any amounts paid with respect thereto, and a reduction in any price paid with respect to other Deliverables to the extent their value to Customer is reduced because of the failure to receive the unacceptable Deliverable, or (iii) cause Supplier to repeat the above process until Customer finds the Deliverable acceptable (or terminates the process pursuant to the above options).

6.                  OWNERSHIP AND RIGHTS

6.1              Definition of Intellectual Property»

.  “Intellectual Property” means software, including all know-how, trade secrets, copyrights, and patentable inventions relating thereto, including materials notes, designs, technical data, ideas, know-how, research, reports, documentation and other information related thereto, and any trademarks, or other intellectual property rights such moral rights, rights to privacy or rights to publicity, or similar rights.

6.2              Ownership of Work Product by Customer»

.  All Deliverables shall be owned by Customer and shall be considered work made for hire by Supplier for Customer. Customer shall own all United States and international copyrights in the Deliverables.

6.3              Vesting of Rights»

.  With the sole exception of any preexisting works identified in Section 6.4, Supplier agrees to assign, and upon creation of each Deliverable automatically assigns, to Customer, its successors and assigns, ownership of all United States and international copyrights in each and every Deliverable, insofar as any such Deliverable, by operation of law, may not be considered work made for hire by Supplier from Customer. From time to time upon Customer's request, Supplier and/or its personnel shall confirm such assignment by execution and delivery of such assignments, confirmations or assignment, or other written instruments as Customer may request. Customer, its successors and assigns, shall have the right to obtain and hold in its or their own name(s) all copyright registrations and other evidence of rights that may be available for Deliverables.

6.4              Preexisting Works»

.  In the event that any Deliverable constitutes a Derivative Work of any preexisting work, Supplier shall ensure that the SOW pertaining to such Deliverable so indicates by references to (1) the nature of such preexisting work; (2) its owner; (3) any restrictions or royalty terms applicable to Supplier's use of such preexisting work or Customer's exploitation of the Deliverable as a Derivative Work thereof; and (4) the source of Supplier's authority to employ the preexisting work in the preparation of the Deliverable. Unless otherwise specifically agreed in the SOW pertaining to such Deliverable, before initiating the preparation of any Deliverable that is a Derivative Work of a preexisting work, Supplier shall cause Customer, its successor, and assigns, to have and obtain the irrevocable, nonexclusive, worldwide, royalty-free right and license to (1) use, execute, reproduce, display, perform, distribute internally or externally, sell copies of, and prepare Derivative Works based upon all preexisting works and Derivative Works thereof and (2) authorize or sublicense others from time to time to do any or all of the foregoing.

6.5              Patent License»

.  Supplier hereby grants to Customer, its successors, and assigns, the royalty-free, worldwide, nonexclusive right and license under any patents owned by Supplier, or with respect to which Supplier has a right to grant such rights and licenses, to the extent required by Customer to exploit the Deliverables and exercise its full rights in the Deliverables, including (without limitation) the right to make, use, and sell products and services based on or incorporating such Deliverables.

6.6              Moral Rights»

.  Supplier hereby waives any and all moral rights, including any right to identification of authorship, rights of approval of modifications, or limitation on subsequent modification that Supplier has or may have in the Deliverables.

7.                  INVENTIONS

7.1              Invention Defined»

.  An “Invention” shall mean any idea, design, concept, technique, invention, discovery, or improvement, regardless of patentability, made solely or jointly by Supplier and/or Supplier's employees, or jointly by Supplier and/or Supplier's employees with one or more employees of Customer, during the term of this Agreement and in performance of any work under any SOW issued hereunder, provided that either the conception or reduction to practice thereof occurs during the term of this Agreement and in the performance of work under a SOW issued hereunder.

7.2              Vesting of Rights»

.  Supplier hereby assigns to Customer, its successors, and assigns, all Inventions, together with the right to seek protection by obtaining patent rights therefor and to claim all rights or priority thereunder, and the same shall become and remain the Customer's property regardless of whether such protection is sought. Supplier shall promptly make a complete written disclosure to Customer of each Invention not otherwise clearly disclosed to Customer in the pertinent Deliverables, specifically pointing out features or concepts that Supplier believes to be new or different. Supplier shall, upon Customer's request and at Customer's expense, cause patent applications to be filed thereon, through solicitors designated by Customer, and shall forthwith sign all such applications over to Customer, its successors, and assigns. Supplier shall give Customer and its solicitors all reasonable assistance in connection with the preparation and prosecution of any such patent applications and shall cause to be executed all such assignments or other instruments or documents as Customer may consider necessary or appropriate to carry out the intent of this Agreement.

7.3              Avoidance of Infringement»

.  In performing services under this Agreement, Supplier agrees to avoid designing or developing any items that infringe Intellectual Property Rights of any third party. If Supplier becomes aware of any such possible infringement in the course of performing work under any SOW issued hereunder, Supplier shall immediately so notify Customer in writing.

8.                  CONFIDENTIAL INFORMATION.

8.1              No Confidential Information of Supplier»

.  It is understood and agreed that Customer does not wish to receive from Supplier any confidential information of Supplier or of any third party. Supplier represents and warrants that any information provided to Customer in the course of entering into this Agreement or any SOW or performing work under any SOW issued hereunder shall not be confidential or proprietary to Supplier.

8.2              Confidential Information of Customer»

.  From time to time Customer may provide its own confidential business and technical information to Supplier in connection with the work to be performed by Supplier under SOWs issued hereunder. Such information shall be designated as confidential upon or prior to disclosure by Customer. In addition, the preparation and specifications of the Deliverables shall in all instances be treated as confidential, unless and until disclosed publicly by Customer. All confidential written materials shall be marked with the legend “Customer--Confidential.” Supplier shall use its best efforts to prohibit any use or disclosure of Customer's confidential information, except as necessary to perform work under the SOWs issued hereunder.

9.                  REPRESENTATIONS AND WARRANTIES; INDEMNIFICATION»

.  Supplier makes the following representations and warranties for the benefit of Customer, as a present and ongoing affirmation of facts in existence at all times when this Agreement or any SOW issued hereunder is in effect:

9.1              No Conflict»

.  Supplier represents and warrants that it is under no obligation or restriction, nor will it assume any such obligation or restriction that does or would in any way interfere or conflict with, or that does or would present a conflict of interest concerning, the work to be performed by Supplier under this Agreement and each SOW issued hereunder.

9.2              Ownership Rights»

.  Supplier represents and warrants that (1) except as provided in Section 9.3 with respect to certain identified preexisting works licensed to Customer, it is and will be the sole author of all works employed by Supplier in preparing any and all Deliverables; (2) it has and will have full and sufficient right to assign or grant the rights and/or licenses granted in the Deliverables pursuant to this Agreement; (3) all Deliverables, including all preexisting works addressed in Section 9.3, have not been and will not be published under circumstances that would cause a loss of copyright therein; and (4) all Deliverables, including all preexisting works addressed in Section 9.3, do not and will not infringe any Intellectual Property Rights of any third party, nor has any claim (whether or not embodied in an action, past or present) of such infringement been threatened or asserted, nor is such a claim pending, against Supplier (or, insofar as Supplier is aware, any entity from which Supplier has obtained such rights).

9.3              Conformity, Performance, and Compliance»

.  Supplier represents and warrants (1) that all Deliverables shall be prepared in a workmanlike manner and with professional diligence and skill; (2) that all Deliverables will function on the machines and with operating systems for which they are designed; (3) that all Deliverables will conform to the specifications and functions set forth in the SOWs relating thereto; and (4) that Supplier will perform all work called for by each SOW issued hereunder in compliance with applicable law.

9.4              No Disabling Code»

.  Supplier represents and warrants that no Deliverable contains any virus, trap door, back door, timer, clock, counter or other limiting routine, instruction or design that would erase data or programming or otherwise cause any software or hardware to become inoperable or incapable of being used in the full manner for which it was designed and created, or provides Supplier or any third party with access to or the ability to alter data or programming code (a “Disabling Code”) including, without limitation, any limitations that are triggered by: (1) a Deliverable being used or copied a certain number of times, or after the lapse of a certain period of time; (2) a Deliverable being installed on or moved to a central processing unit or system that has a serial number, model number or other identification different from the central processing unit or system on which the Deliverable was originally installed; or (3) the occurrence or lapse of any similar triggering factor or event.. In the event Disabling Codes are identified by Customer or Supplier in the products, Supplier shall: (i) take all steps necessary at Supplier's sole cost to test a new copy of the Deliverables for the presence of Disabling Codes: (ii) furnish to Customer a new copy of the Deliverables without the presence of Disabling Codes, (iii) install and implement such new copy of the Deliverables at no additional cost to Customer; and (iv) take all steps necessary, at Supplier's sole cost, to restore any and all data or programming lost by Customer as a result of such Disabling Code.

9.5              Indemnification of Customer. 

(a)                Supplier will defend and indemnify Customer against a claim that Deliverables furnished and used within the scope of this Agreement infringe any Intellectual Property Rights of a third party, provided that: (i) Customer promptly notifies Supplier of such claim (provided failure or delay in notification shall not relieve Supplier of such obligation unless and to the extent Supplier is materially prejudiced thereby); (ii) Supplier has control of the defense and all related settlement negotiations; and (iii) Customer provides Supplier with the assistance, information and authority necessary to perform Supplier's obligations under this Section 9.6. Reasonable out-of-pocket expenses incurred by Customer in providing such assistance will be reimbursed by Supplier.  Customer, at its own expense, shall have the right to participate in Supplier's defense of any such action through Licensor’s own counsel, including the right to provide reasonable input on strategy.

(b)               Supplier shall have no liability to Customer to the extent that any alleged infringement or claim of infringement is based upon: (i) written specifications or modifications requested by the Customer (unless and to the extent such specifications or modifications could have been developed or implemented by Supplier in a non-infringing manner); but only to the extent that such specifications or modifications are not used for the benefit of any other customer or licensee of Supplier nor otherwise marketed by Supplier, and to the extent that the claim would not have arisen but for such adherence to such specifications or such modifications, and to the extent that there exist substantial noninfringing uses absent such specifications or modifications; (ii) any modifications to the Deliverables by Customer not authorized by Supplier, but only to the extent that the claim would not have arisen but for such modification, and to the extent that such modifications are not required to use the Deliverables in a manner marketed by Supplier, and to the extent that there exist substantial noninfringing uses of the Deliverables absent such modifications; (iii) use of the Deliverables in connection or in combination with equipment, devices, or software not provided by Supplier and such program, equipment, product, device or process is not specified as required for the use of the Deliverables by Supplier (e.g. operating system software) and such infringement would have been avoided by the use of the Deliverables alone, but only to the extent that such use is not required to use the Deliverables in a manner marketed by Supplier and to the extent that there exist substantial noninfringing uses of the Deliverables absent such use; or (iv) the use of Deliverables in breach of this Agreement or (v) use of other than the most current release or version of the Deliverables, provided however that (A) Customer was provided such version by Supplier for no incremental or other additional cost, along with a clear written notice to Customer which (1) identifies for Customer the nature of any potential infringement as to the previous releases or versions so as to enable Customer to assess the risk of potential infringement and (2) specifies that use of such current release or version is expected to prevent infringement; (B) such current release or version provides no less functionality than the functionality provided in previous releases or versions; (C) such current release or version is backwards compatible with previous releases or versions and (D) and such claim would have been prevented by the use of such current release or version.

(c)                In the event that Customer’s use of the Deliverables is limited in any way by an injunction, Supplier shall at its expense either:   (i) procure for Customer the right to continue using the Deliverables, as well as the right for Supplier and its customers to continue use of the Deliverables, while maintaining its functionality; or (ii) modify the Deliverables to make it non infringing, while providing no less functionality than the functionality provided by the unmodified Deliverables and while maintaining backwards compatibility with the unmodified Deliverables; or (iii) replace the Deliverables, so long as such replacement is made without additional charge to the Customer, and provides no less functionality than the functionality provided by the replaced Deliverables and while maintaining backwards compatibility with the replaced Deliverables.  If none of the foregoing steps is commercially practicable, and Customer has thereafter been given the opportunity to otherwise resolve the matter, Supplier will accept any return of the Deliverables by Customer in exchange for a full refund to the Customer all amounts paid under this Agreement by the Customer.  Any election by Supplier under this clause (c) shall not be deemed to waive or limit any other rights the Customer may have including, but not limited to, rights of indemnity under Section 9.6(a).

10.              TERM AND TERMINATION.

10.1          Term of Agreement»

.  This Agreement shall be effective upon the date specified at the beginning hereof and shall remain in force until terminated as provided herein. However, this Agreement shall continue to remain in effect with respect to any SOWs already issued hereunder at the time of such termination, until such SOWs are themselves terminated and performance thereunder is completed.

10.2          Termination of SOWs»

.  Customer may, at its sole option, terminate any or all SOWs outstanding, or any portion thereof, upon 15 days' written notice. Upon receipt of notice of such termination, Supplier shall inform Customer of the extent to which performance has been completed through such date, and collect and deliver to Customer whatever work product then exists in a manner prescribed by Customer. Supplier shall be paid for all work performed through the date of termination, provided that such payment shall not be greater than the payment that would have become due if the work had been completed. Supplier may not terminate any SOW once Supplier has entered into such SOW.

10.3          Termination of Agreement»

.  Either party may terminate this Agreement upon not less than 90 days' notice to the other party. However, this Agreement shall continue to remain in effect with respect to any SOW already issued hereunder until such other SOW is itself terminated and/or performance thereunder is completed.

10.4          Survival»

.  In the event of any termination of this Agreement, Sections 6, 7, 8, 9, 10 and 11 hereof shall survive and continue in effect and shall inure to the benefit of and be binding upon the parties and their legal representatives, heirs, successors, and assigns.

11.              MISCELLANEOUS. 

11.1          Delay; Force Majeure»

.  Either party shall be excused from delays in performing or from its failure to perform hereunder to the extent that such delays or failures result from causes beyond the reasonable control of such party; provided that, in order to be excused from delay or failure to perform, such party must act diligently to remedy the cause of such delay or failure.  Supplier agrees to notify Customer promptly of any factor, occurrence, or event coming to its attention that may affect Supplier's ability to meet the requirements of any SOW issued under this Agreement, or that is likely to occasion any material delay in delivery of Deliverables. Such notice shall be given in the event of any loss or reassignment of key employees, threat of strike, or major equipment failure.

11.2          No Agency»

.  Supplier, in rendering performance under SOWs issued hereunder from time to time, is acting solely as an independent contractor. Customer does not undertake by this Agreement or otherwise to perform any obligation of Supplier, whether by regulation or contract. In no way is Supplier to be construed as the agent or to be acting as the agent of Customer in any respect, any other provisions of this Agreement or any SOWs issued hereunder notwithstanding.

11.3          Agreements With Employees»

.  Supplier shall obtain and maintain in effect written agreements with each of its employees and contractors who participate in any of Supplier's work under any SOWs issued hereunder. Such agreements shall contain terms sufficient for Supplier to comply with all provisions of the Agreement and to support all grants and assignments of rights and ownership hereunder. Such agreements also shall impose an obligation of confidence on such employees and contractors with respect to Customer's confidential information.

11.4          Section Headings; Exhibits»

.  The section and subsection headings used herein are for reference and convenience only, and shall not enter into the interpretation hereof. The exhibits referred to herein and attached hereto, or to be attached hereto, including all SOWs issued hereunder from time to time, are incorporated herein to the same extent as if set forth in full herein.

11.5          Required Approvals»

.  Where agreement, approval, acceptance, or consent by either party is required by any provision of this Agreement, such action shall not be unreasonably delayed or withheld.

11.6          No Waiver»

.  No delay or omission by either party hereto to exercise any right or power occurring upon any noncompliance or default by the other party with respect to any of the terms of this Agreement shall impair any such right or power or be construed to be a waiver thereof. A waiver by either of the parties hereto of any of the covenants, conditions, or agreements to be performed by the other shall not be construed to be a waiver of any succeeding breach thereof or of any covenant, condition, or agreement herein contained. Unless stated otherwise, all remedies provided for in this Agreement shall be cumulative and in addition to and not in lieu of any other remedies available to either party at law, in equity, or otherwise.

11.7          Authority of Supplier»

.  Supplier has the sole right and obligation to supervise, manage, contract, direct, procure, perform, or cause to be performed all work to be carried out by Supplier hereunder unless otherwise provided herein.

11.8          Language; Governing Law; Currency»

. This Agreement shall be signed by the parties in the English language.  In the event of any translation, the English language version as signed by the parties shall be determinative.  The validity, construction and performance of this Agreement will be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts, USA, applicable to contracts executed in and performed entirely within such Commonwealth, without reference to any choice of law principles of such Commonwealth. The application to this Agreement of the United Nations Convention on Contracts for the International Sale of Goods is hereby expressly excluded.  The parties agree to non-exclusive personal jurisdiction and venue of the United States District Court of Massachusetts. All amounts of money payable hereunder shall be payable in U.S. dollars unless otherwise expressly stated or otherwise agreed.

11.9          Entire Agreement»

.  This Agreement and the exhibits annexed hereto, together with the SOWs issued from time to time hereunder, constitute the entire agreement between the parties. No change, waiver, or discharge hereof shall be valid unless it is in writing and is executed by the party against whom such change, waiver, or discharge is sought to be enforced.

11.10      Notices»

. All notices, demands, requests or other communications that may be or are required to be given, served or sent by any party pursuant to this Agreement will be in writing (and shall be deemed to have been duly given upon receipt), will reference this Agreement and shall be transmitted by express courier or hand delivery or facsimile transmission, addressed to the address following such party's signature on the signature page of this Agreement.  Each party may designate by notice in writing a new address to which any notice, demand, request or communication may thereafter be so given, served or sent.  Each notice that is delivered or transmitted in the manner described above shall be deemed sufficiently given, served, sent and received for all purposes at such time as it is delivered to the addressee (with the delivery receipt or the affidavit of messenger or courier being deemed conclusive evidence of such delivery) or at such time as delivery is refused by the addressee upon presentation.

11.11      Subcontracting; Assignment; Subsidiaries.

[If Supplier desires to use a subcontractor or contract worker in performing the services under this Agreement, Supplier shall upon or before engaging the services of such subcontractor or contract worker notify Customer in writing.  Customer shall have the right by oral or written notice to Supplier cause Supplier to remove such subcontractor or contract worker from work on the services provided under this Agreement for any reason, or for no reason.]

[or]

[Customer has specifically bargained for the services to be provided by Supplier by reason of the Supplier's specific skills, and accordingly, the services hereunder may not be delegated or subcontracted without the consent of Customer.]

The rights and liabilities of the parties hereto will bind and inure to the benefit of their respective successors, executors and administrators, as the case may be; provided that neither party may assign or delegate its obligations under this Agreement either in whole or in part, expressly or by operation of law, without the prior written consent of the other, except that each party may assign this Agreement (A) to any Subsidiary (as defined below) or company of which it is a Subsidiary so long as it remains responsible for such Subsidiary's performance or (B) to a person or entity into which it has merged or which has otherwise succeeded to all or substantially all of its business and assets to which this Agreement pertains, by purchase of stock, assets, merger, reorganization or otherwise, and which has assumed in writing or by operation of law its obligations under this Agreement.  Any attempted assignment in violation of the provisions of this Section will be void.  All rights and licenses granted to a party under this Agreement shall apply to that party's Subsidiaries so long as such Subsidiaries agree to comply fully with the obligations imposed on that party by this Agreement and so long as such Subsidiary continues to be a Subsidiary of a party.  Each party shall remain fully liable for the actions and omissions of its Subsidiaries relative to rights granted under this section.  The parties agree, however, that they may not seek to enforce any obligation of the other party (or its Subsidiaries) through a legal action brought against a Subsidiary except to the extent that such action seeks injunctive relief against that particular Subsidiary.  “Subsidiary” of an entity means a corporation, company or other entity (A) more than fifty percent (50%) of whose outstanding shares or securities (representing the right to vote for the election of directors or other managing authority) are; or (B) which does not have outstanding shares or securities, as may be the case in a partnership, joint venture or unincorporated association, but more than fifty percent (50%) of whose ownership interest (representing the right to make decisions for such corporation, company or other entity) is; in each of (A) and (B) now or hereafter, owned or controlled, directly or indirectly, by the entity in question, as the case may be, but such corporation, company or other entity shall be deemed to be a Subsidiary only so long as such control exists.

11.12      Compliance With Laws»

. The parties agree that they shall comply with all applicable laws and regulations of governmental bodies or agencies in their performance under this Agreement. Without limiting the generality of the foregoing, neither party will knowingly export or re-export, directly or indirectly, any technical data (as defined by the U.S. Export Administration Regulations) produced or provided under this Agreement, or export or re-export, directly or indirectly, any direct product of such technical data, including software, to a destination to which such export or re-export is restricted or prohibited by U.S. or non-U.S. law, without obtaining prior authorization from U.S. Department of Commerce and other competent government authorities to the extent required by those laws.

IN WITNESS THEREOF, Customer and Supplier have caused this Agreement to be signed and delivered by their duly authorized officers, all as of the date first hereinabove written.

[CUSTOMER]                                                      [SUPPLIER]

By______________________________             By____________________________________

Address:                                                                       Address:


[Exhibit A - Statement of Rates]


OUTLINE OF SOW

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