Contracts and Agreements

AS A BUSINESS OWNER, YOU WILL RECEIVE and administer all kinds of contracts and agreements, the most common legal transactions you will be involved in when running a business. Properly executed contracts provide grounds to legally enforce and dispute business matters.

The surest way to maintain clear understandings with your customers and vendors is to document your arrangements in written agreements. We have included here several useful and universal contracts and agreements.

Use the Bill of Sale to record the terms of a simple sale of goods or property. The Unsecured Promissory Note is a legal document that documents a promise to pay money at a future date. Use this document to memorialize simple business or personal loans. The Secured Promissory Note and Security Agreement is a legal document that memorializes a loan, but it goes a step farther: it grants to the lender the right to repossess property in the event the loan is not repaid. The Secured Promissory Note and Security Agreement gives the lender greater rights and power than the Unsecured Promissory Note.

The Consulting Services Agreement is a general and universal agreement suitable for nearly all types of consulting services firms. Customize the agreement to cover the particular services that you offer.

The Multimedia Development Contract is a contract suitable for use by Web developers, programmers, and print and graphic designers. Keep in mind, however, that you’ll need to customize the contract to cover the particular services you offer.

The Mutual Compromise Agreement and Mutual Release is an agreement to finally and forever settle a dispute between two parties. Use this agreement to finalize the resolution of conflicts and lawsuits between you and third parties.

Use the Checklist for a Buyer’s Purchase Order for quality assurance, knowing that the final order is correct in its wording as to all terms and conditions. The Checklist for Modifying or Extending an Existing Contracts to ensure the changes you make to a signed agreement are compliant and correctly communicate all amendments, redefined terms, and other changes.

If your company is the seller, refer to the Checklist for Purchase Orders Where Your Company Is the Seller to confirm you’ve clearly established the terms and conditions of the sale including pricing, loss assessment, shipping, and delivery dates.

Use the Checklist for Sales Agreements Where Your Company is the Seller to ensure the correct legal name of parties, effective dates of the contract are set, the terms, and more.

Refer to the sample Terms of Purchase to help you establish the contractual obligations of the buy. In addition, the seller can use the sample Terms of Sale form to establish the delivery and payment terms agreed on between your company and the buyer.

If your contract will require legal counsel, refer to the Examples of Legal “Boilerplate” for assigning a lawyer, lawyer fees, and venue, and defining the overall legal contract.

The Lawyer Engagement Letter can be used as a sample letter to request legal representation from your chosen firm. Once your company is set to work with outside counsel, refer to the Terms and Conditions for Outside Legal Counsel to establish the framework of the relationship.

Finally, if your company requires outside service that may involve diagnostic testing and/or the use of specialized equipment, use the sample Service Evaluation and Repair Agreement to document the description of work, costs, liability, and warranties.

77. Bill of Sale

BILL OF SALE

This Bill of Sale is made on this ______ day of 20___ between ______________________________ (“Seller”) and ____________________________ (“Buyer”).

Seller, in exchange for consideration of $_________, the receipt of which funds is acknowledged, hereby do grant, sell, transfer, and deliver to Buyer the following goods:

________________________________________________________________.

Buyer shall have full rights and title to the goods described above.

Seller is the lawful owner of the goods and the goods are free from all encumbrances. Seller has good right to sell the goods and will warrant and defend the right against the lawful claims and demands of all persons.

________________________________

Signature of Seller

________________________________

Signature of Buyer

78. Unsecured Promissory Note

UNSECURED PROMISSORY NOTE

Amount: $____________________

Date: ____________________

For value received, ____________________(“Borrower”) hereby covenants and promises to pay to ____________________(“Lender”) ____________________Dollars ($ ____________________.00) in lawful money of the United States of America, together with interest thereon computed from the date hereof at the rate of ten percent (10%) per annum, on an actual day/365 day basis. All interest, principal, and other costs hereunder shall be due and payable to the holder (“Holder”) of this Promissory Note (this “Note”) on or before ____________________(the “Due Date”).

Payments of principal and interest will be made in legal tender of the United States of America. Borrower shall have the right to prepay without penalty all or any part of the unpaid balance of this Note at any time. Borrower shall not be entitled to re-borrow any prepaid amounts of the principal, interest, or other costs or charges. All payments made pursuant to this Note will be first applied to accrued and unpaid interest, if any, then to other proper charges under this Note, and the balance, if any, to principal.

This Note shall be paid as follows: monthly payments of $____________________shall be made upon this Note on the first day of each month, commencing with the date of ____________________, and shall continue until ____________________(the “Repayment Date”), at which time all sums due hereunder shall be paid.

Notwithstanding anything in this Note to the contrary, the entire unpaid principal amount of this Note, together with all accrued but unpaid interest thereon and other unpaid charges hereunder, will become immediately all due and payable without further notice at the option of the Holder if Borrower fails to timely make any payment hereunder when such payment becomes first due and such failure continues for a period of ten days after written notice from Holder to Borrower.

If any amount payable to Holder under this Note is not received by Holder on or before the Due Date, then such amount (the “Delinquent Amount”) will bear interest from and after the Due Date until paid at an annual rate of interest equal to the greater of (i) fifteen percent (15%) or (ii) the maximum rate then permitted by law (the “Default Rate”). If the maximum rate then permitted by law is lower than 15%, the maximum legal rate shall be the Default Rate.

All rights, remedies, undertakings, obligations, options, covenants, conditions, and agreements contained in this Note are cumulative and no one of them will be exclusive of any other. Any notice to any party concerning this Note will be delivered as set forth in the Financing Agreement.

Borrower for itself and its legal representatives, successors, and assigns expressly waives presentment, protest, demand, notice of dishonor, notice of nonpayment, notice of maturity, notice of protest, presentment for the purpose of accelerating maturity, and diligence in collection, and consents that Holder may extend the time for payment or otherwise modify the terms of payment or any part or the whole of the debt evidenced hereby.

The prevailing party in any action, litigation, or proceeding, including any appeal or the collection of any judgment concerning this Note, will be awarded, in addition to any damages, injunctions, or other relief, and without regard to whether or not such matter be prosecuted to final judgment, such party’s costs and expenses, including reasonable attorneys’ fees, and Lender shall be entitled to recover all of its attorneys’ fees and costs should Lender place this Note in the hands of an attorney for collection.

________________________(“Borrower”)

Signature________________

Date_____________________

79. Secured Promissory Note and Security Agreement

SECURED PROMISSORY NOTE

Amount: $____________________

Date: ____________________

For value received, ____________________(“Borrower”) hereby covenants and promises to pay to ____________________(“Lender”) ____________________Dollars ($____________________) in lawful money of the United States of America, together with interest thereon computed from the date hereof at the rate of ten percent (10%) per annum, on an actual day/365 day basis. All interest, principal, and other costs hereunder shall be due and payable to the holder (“Holder”) of this Promissory Note (this “Note”) on or before ____________________(the “Due Date”).

Payments of principal and interest will be made in legal tender of the United States of America. Borrower shall have the right to prepay without penalty all or any part of the unpaid balance of this Note at any time. Borrower shall not be entitled to re-borrow any prepaid amounts of the principal, interest, or other costs or charges. All payments made pursuant to this Note will be first applied to accrued and unpaid interest, if any, then to other proper charges under this Note, and the balance, if any, to principal.

This Note is secured by a security interest in Borrower’s assets, as more particularly described in the Security Agreement attached to this Note.

This Note shall be paid as follows: monthly payments of $____________________shall be made upon this Note on the first day of each month, commencing with the date of ____________________, and shall continue until ____________________(the “Repayment Date”), at which time all sums due hereunder shall be paid.

Notwithstanding anything in this Note to the contrary, the entire unpaid principal amount of this Note, together with all accrued but unpaid interest thereon and other unpaid charges hereunder, will become immediately all due and payable without further notice at the option of the Holder if Borrower fails to timely make any payment hereunder when such payment becomes first due and such failure continues for a period of ten days after written notice from Holder to Borrower.

If any amount payable to Holder under this Note is not received by Holder on or before the Due Date, then such amount (the “Delinquent Amount”) will bear interest from and after the Due Date until paid at an annual rate of interest equal to the greater of (i) fifteen percent (15%) or (ii) the maximum rate then permitted by law (the “Default Rate”). If the maximum rate then permitted by law is lower than 15%, the maximum legal rate shall be the Default Rate.

All rights, remedies, undertakings, obligations, options, covenants, conditions, and agreements contained in this Note are cumulative and no one of them will be exclusive of any other. Any notice to any party concerning this Note will be delivered as set forth in the Financing Agreement.

Borrower for itself and its legal representatives, successors, and assigns expressly waives presentment, protest, demand, notice of dishonor, notice of nonpayment, notice of maturity, notice of protest, presentment for the purpose of accelerating maturity, and diligence in collection and consents that Holder may extend the time for payment or otherwise modify the terms of payment or any part or the whole of the debt evidenced hereby.

The prevailing party in any action, litigation, or proceeding, including any appeal or the collection of any judgment concerning this Note, will be awarded, in addition to any damages, injunctions, or other relief, and without regard to whether or not such matter be prosecuted to final judgment, such party’s costs and expenses, including reasonable attorneys’ fees, and Lender shall be entitled to recover all of its attorneys’ fees and costs should Lender place this Note in the hands of an attorney for collection.

________________________(“Borrower”)

Signature_______________

Date_____________

This security Agreement is made on this ___ day of ______ between___________ (“Borrower”) and ____________________ (“Lender”).

SECURITY AGREEMENT ACCOMPANYING SECURED PROMISSORY NOTE

1. Security Interest. Borrower grants to Lender a “Security Interest” in the following property (the “Collateral”):

090

The Security Interest shall secure the payment and performance of Borrower’s promissory note of given date herewith in the principal amount of ____________________Dollars ($____________________) and the payment and performance of all other liabilities and obligations of Borrower to Lender of every kind and description, direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising.

2. Covenants. Borrower hereby warrants and covenants:

a. The parties intend that the collateral is and will at all times remain personal property despite the fact and irrespective of the manner in which it is attached to realty.

b. The Borrower will not sell, dispose, or otherwise transfer the collateral or any interest therein without the prior written consent of Lender, and the Borrower shall keep the collateral free from unpaid charges (including rent), taxes, and liens.

c. The Borrower shall execute alone or with Lender any Financing Statement or other document or procure any document, and pay the cost of filing the same in all public offices wherever filing is deemed by Lender to be necessary.

d. Borrower shall maintain insurance at all times with respect to all collateral against risks of fire, theft, and other such risks and in such amounts as Lender may require. The policies shall be payable to both the Lender and the Borrower as their interests appear and shall provide for ten (10) days’ written notice of cancellation to Lender.

e. The Borrower shall make all repairs, replacements, additions, and improvements necessary to maintain any equipment in good working order and condition. At its option, Lender may discharge taxes, liens, or other encumbrances at any time levied or placed on the collateral, may pay rent or insurance due on the collateral, and may pay for the maintenance and preservation of the collateral. Borrower agrees to reimburse Lender on demand for any payment made or any expense incurred by Lender pursuant to the foregoing authorization.

3. Default. The Borrower shall be in default under this Agreement if it is in default under the Note. Upon default and at any time thereafter, Lender may declare all obligations secured hereby immediately due and payable and shall have the remedies of a Lender under the Uniform Commercial Code. Lender may require the Borrower to make it available to Lender at a place that is mutually convenient. No waiver by Lender of any default shall operate as a waiver of any other default or of the same default on a future occasion. This Agreement shall inure to the benefit of and bind the heirs, executors, administrators, successors, and assigns of the parties. This Agreement shall have the effect of an instrument under seal.

________________________(“Borrower”)

Signature________________

Date_____________________

80. Consulting Services Agreement

CONSULTING SERVICES AGREEMENT

This Consulting Services Agreement (this “Agreement”) is hereby made between ____________________(“Client”) and ____________________(“Consultant”). Consultant agrees to provide the “Services,” as more fully defined below, to Client and Client agrees to pay to Consultant the Consultant Services Fee, as more fully defined below.

1. Definitions. The following definitions shall apply to this Agreement.

a. The “Services Fee Payment Schedule” (if applicable) shall include the compensation outlined in Exhibit A, and shall be paid according to the terms outlined in the table attached to this Agreement as Exhibit B.

b. The “Agreement Term” shall begin with the Commencement Date and shall end with the Termination Date.

c. The “Commencement Date” shall be the later of (i) the last date upon which a party executes this Agreement or (ii) the first date upon which Services are rendered.

d. The “Termination Date” shall be any of the following: (i) the one-year anniversary of the Commencement Date or (ii) the date of receipt by either party of a Termination Notice.

2. Services. Consultant shall perform the duties and tasks outlined in the table attached to this Agreement as Exhibit C (the “Services”). The Services may include a development schedule and milestones.

3. Payment. Client shall pay the “Consulting Services Fee” as outlined in the table attached to this Agreement as Exhibit A, and shall pay such Consulting Services Fee according to the “Services Fee Payment Schedule” (if applicable) as outlined in the table attached to this Agreement as Exhibit B.

4. Termination. Either party may without cause terminate this Agreement by delivering to the other party written notice via U.S. Mail, facsimile, or personal delivery (but not by electronic mail transmission) expressing a desire to terminate this Agreement (a “Termination Notice”). Termination shall be effective immediately upon receipt of a Termination Notice.

5. Representations and Warranties. The parties to this Agreement make the following representations and warranties.

a. Both parties represent and warrant to the other party that they have the full power to enter into this agreement without restriction.

b. This Agreement shall not establish an employer/employee relationship between the parties. Consultant shall be an independent contractor and shall not enjoy the benefits normally afforded to employees provided either by Client’s policy or by law.

c. Consultant shall not include in the Material (as defined in Paragraph 5, below) any copyrights, trade secrets, trademarks, service marks, patents, or other property that to the Consultant’s knowledge would infringe on the rights of third parties.

d. Consultant shall not be an agent or representative of Client, except as specifically defined in this Agreement. Consultant shall have no authority to, and shall not attempt to, bind Client to contracts with third parties.

6. Confidential Information. Neither party shall, at any time, either directly or indirectly, use for its own benefit, nor shall it divulge, disclose, or communicate any information received from the other party that has been identified as Confidential. Both parties agree to execute standard nondisclosure agreements in connection with this Agreement.

7. Copyrights. Consultant, in the absence of any agreement to the contrary, agrees to irrevocably assign and convey to Client all rights, title, and interest to the copyrights, trade secrets, trademarks, service marks, patents, or other property created or to be created in connection with the performance of the Services (the “Material”). Client shall be deemed the author of such material and the Material shall be a “work for hire” as defined in 17 U.S.C. § 201 and the cases interpreting it.

8. Limitation of Damages. NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY FOR ANY INCIDENTAL, CONSEQUENTIAL, SPECIAL, OR PUNITIVE DAMAGES OF ANY KIND OR NATURE, INCLUDING, WITHOUT LIMITATION, THE BREACH OF THIS AGREEMENT OR ANY TERMINATION OF THIS AGREEMENT, WHETHER SUCH LIABILITY IS ASSERTED ON THE BASIS OF CONTRACT, TORT, OR OTHERWISE, EVEN IF EITHER PARTY HAS BEEN WARNED OR WARNED OF THE POSSIBILITY OF ANY SUCH LOSS OR DAMAGE.

9. General Provisions. This Agreement constitutes the entire agreement of the parties and supersedes all prior understandings and agreements of the parties, whether oral or written. If any provision of this Agreement shall be held to be invalid or unenforceable for any reason, (i) the remaining provisions shall continue to be valid and enforceable; or (ii) if by limiting such provision it would become valid and enforceable, then such provision shall be deemed to be written, construed, and enforced as so limited. This Agreement shall be governed by the laws of the State of California. This Agreement is to be performed in (and venue shall lie exclusively in) ____________________County,

____________________. This Agreement shall not be strictly construed against any party to this Agreement. Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall be resolved by either (i) adjudication in a small claims court (subject to jurisdictional limitations) or (ii) in binding arbitration administered under the rules of the American Arbitration Association in accordance with its applicable rules.

091

Exhibit A: The “Consulting Services Fee” shall include the following payments and shall be according to the terms outlined herein:

The “Consulting Services Fee” shall include:

$____________________, payable per hour for the time that Consultant devotes to the performance of the Services and for which written itemization for individual tasks is provided to Client (the “Hourly Rate”). The Hourly Rate shall be recorded in increments of time no greater than 1/10 of an hour (6 minutes). Payment shall be made within 15 days of the receipt of a written invoice by Client.

The “Consulting Services Fee” shall include:

$____________________, payable in cash, by negotiable draft(s), or by transfer(s) to Client’s bank account, according to the Services Fee Payment Schedule, which appears as Exhibit B.

Exhibit B: The “Services Fee Payment Schedule” shall include the following payments and according to the terms outlined herein:

The “Consulting Services Fee” shall be paid as follows:

$____________________shall accrue to the consultant upon the completion of each calendar month of service. Partial months shall be prorated on a daily basis. Payment shall be made within 15 days following the later of (a) the end of any applicable calendar month or (b) the submission of a written invoice to Client.

Exhibit C: The “Services” to be performed under the Agreement shall include the following:

Describe services to be performed.

81. Multimedia Development Contract

MULTIMEDIA DEVELOPMENT CONTRACT

This agreement is entered into by and between ____________________(“Client”) and ____________________(“Developer”) (together, the “Parties”).

The effective date of this agreement is ____________________(“Effective Date”).

WHEREAS, Developer offers the following services and related services: digital media design and development, corporate identity design and development, print design, Web site design and development, interactive kiosk design and development, CD-ROM design and development, logo design and development, computer graphics design and development.

WHEREAS, Client wishes to have Developer provide services for compensation.

NOW, THEREFORE, in consideration of the promises and mutual covenants and agreements set forth herein, Client and Developer agree as follows:

Definitions

“Existing Client Content” means the material provided by Client to be incorporated into the Product.

“Developer Tools” means the software tools of general application, whether owned or licensed to Developer, which are used to develop the Product.

“Development Schedule” shall be, only when applicable, as set forth in Schedule B to this Agreement, which lists the deliverable items contracted for (“Deliverables”) and the deadlines for their delivery.

“Error” means, only when applicable, any failure of a Deliverable or Product to (i) meet the Specifications, if any, or (ii) to properly operate.

“Payment Schedule” shall be set forth in Schedule C to this Agreement and is the schedule by which payments under this agreement shall be made.

“Product” means the material that is the subject of this agreement, as further described in paragraph 1.1, below.

“Specifications” for the product, only when applicable, shall be set forth in Schedule A.

DEVELOPMENT AND DELIVERY OF DELIVERABLES, PAYMENT

1.1. Developer agrees to develop, on behalf of Client, the following (the “Product”): (describe what you are making, e.g., interactive Kiosk, educational CD-ROM, Web site, etc.).

1.2. Developer shall use his best efforts to develop each Deliverable and/or Product in accordance with the Specifications, if any.

1.3. All development work will be performed by Developer or his employees or by approved independent contractors who have executed confidentiality agreements, where appropriate.

1.4. Developer shall deliver all Deliverables and/or Product within the times specified in the Development Schedule and in accordance with the Specifications, if any.

1.5. Developer agrees to comply with all reasonable requests of Client as to the manner of delivery of all Deliverables, which may include delivery by electronic means.

1.6. Client agrees to pay according to the Payment Schedule.

1.7. If the Client, following the execution of this Agreement, alters the Specifications, or alters the nature and/or scope of the project as described in paragraph 1.1, or requests additional work, Developer reserves the right, upon notification to the Client, to (i) modify the Payment Schedule or (ii) charge Client on an hourly basis for the additional time at the rate of $____________________per hour.

1.8. Except as expressly provided in this Agreement or in a later writing signed by the Client, Developer shall bear all expenses arising from the performance of its obligations under this Agreement.

1.9. Except as expressly provided in this Agreement, this Agreement does not include any maintenance work on the Product or later enhancements to the product.

TESTING AND ACCEPTANCE

2.1. All Deliverables shall be thoroughly tested by Developer (if applicable) and all necessary corrections as a result of such testing shall be made, prior to delivery to Client.

2.2. When applicable, in the event that a Deliverable or Product delivered to Client has an Error, Client shall notify Developer within 7 days of delivery or shall waive its objections. Upon notification to Developer, Developer shall have 7 days to make a correction to the Deliverable or Product and present the repaired Deliverable or Product to Client. If the Payment Schedule calls for work under this Agreement to be paid by piece rate, time spent correcting Errors is to be included in the amounts in the Payment Schedule. If the Payment Schedule calls for work under this Agreement to be paid by hourly rate, time spent correcting Errors shall be billed to Client according to the hourly rate in the Payment Schedule.

3.1. Client will retain copyright ownership of Existing Client Content.

3.2. Developer will retain copyright ownership of the following material (“Developer’s Components”) to be created in the development of the Product and to include any and all of the following:

a. Developer’s existing tools, such as (source code, pre-existing code, scripts, stock images—basically your tools that you bring to the project: these should be non-negotiable items and should appear here in every contract.)

b. Content created in connection with development of the Product, including: (simply insert the components that you are creating to which you wish to retain the rights—HTML code, source code, Java code, computer code in any language, images, animations, scripts, script code, text, logos).

3.3. Client will retain copyright ownership of, and Developer agrees to irrevocably assign and convey to Client all rights, title, and interest in the same, the following material (“Client’s Components”) to be created in the development of the Product and to include any and all of the following: (HTML code, source code, Java code, computer code in any language, images, animations, scripts, script code, text, logos—simply insert the components that you are creating to which you wish to give the rights).

3.4. Developer will retain copyright ownership of any copyrights not specifically granted to either party by this Agreement (“Non-specified Components”).

3.5. Developer, however, grants to Client a royalty-free, worldwide, perpetual, irrevocable, non-exclusive license, with the right to sublicense through multiple tiers of sub-licensees, to use, reproduce, distribute, modify, publicly perform, and publicly display the Developer’s Components and Non-specified Components in any medium and in any manner, unless such rights are specifically limited by this Agreement. This license includes the right to modify such copyrighted material.

3.6. Client, however, grants to Developer a royalty-free, worldwide, perpetual, irrevocable, non-exclusive license, to use, reproduce, distribute, modify, publicly perform, and publicly display its Existing Client Content and Client’s Components (if any) for the sole and limited purpose of use in Developer’s portfolio as self-promotion and not for direct commercial sale.

3.7. For the purposes of this agreement, “copyright” shall be deemed to include copyrights, trade secrets, patents, trademarks, and other intellectual property rights.

3.8. If any third party content or Developer Tools are used in the development of the Product, Developer shall be responsible for obtaining and/or paying for any necessary licenses to use third party content.

CONFIDENTIALITY

4.1. The terms of this Agreement, Existing Client Content, and other sensitive business information are confidential (“Confidential Information”). Developer and Client agree, except as authorized in writing, not to disclose to any third party Confidential Information. Developer agrees to return to Client promptly, upon completion of the Product, all Existing Client Content.

WARRANTIES, COVENANTS, AND INDEMNIFICATION

5.1. Developer represents and warrants to Client the following: (i) Developer has the full power to enter into this agreement without restriction, (ii) except with respect to Existing Client Content, and properly licensed materials, the performance, distribution, or use of the Product will not violate the rights of any third parties, and (iii) Developer agrees to defend, hold harmless, and indemnify Client and its representatives from and against all claims, defense costs, judgments, and other expenses arising out of the breach of the foregoing warranties.

5.2. Client represents and warrants to Developer the following: (i) Client has the full power to enter into this agreement without restriction, (ii) the performance of this Agreement will not violate the rights of any third parties, and (iii) Client agrees to defend, hold harmless, and indemnify Developer and its representatives from and against all claims, defense costs, judgments, and other expenses arising out of the breach of the foregoing warranties.

TERMINATION

6.1. If Developer fails to correct an Error according to paragraph 2.2 after 3 attempts, Client may terminate this agreement without making any further payments according to the Payment Schedule.

6.2. No termination of this Agreement by any party shall affect Developer’s rights to receive his hourly rate for all time spent producing Deliverables and/or Product.

MISCELLANEOUS PROVISIONS

7.1. This Agreement contains the entire understanding and agreement of the parties, supersedes all prior written or oral understandings or agreements, and may not be altered, modified, or waived except in a signed writing.

7.2. EXCEPT AS PROVIDED ABOVE WITH RESPECT TO THIRD PARTY INDEMNIFICATION, NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY FOR ANY INCIDENTAL, CONSEQUENTIAL, SPECIAL, OR PUNITIVE DAMAGES OF ANY KIND OR NATURE, INCLUDING, WITHOUT LIMITATION, THE BREACH OF THIS AGREEMENT OR ANY TERMINATION OF THIS AGREEMENT, WHETHER SUCH LIABILITY IS ASSERTED ON THE BASIS OF CONTRACT, TORT, OR OTHERWISE, EVEN IF EITHER PARTY HAS BEEN WARNED OR WARNED OF THE POSSIBILITY OF ANY SUCH LOSS OR DAMAGE.

_________________________________________

_________________________________________

(This will depend on the job, obviously, and may not apply to all jobs.)

Development Schedule

(This will depend on the job, obviously, and may not apply to all jobs.)

Payment Schedule

(For hourly rate:)

Developer shall be paid on an hourly basis, and his rates and billing procedures are as follows: Charges are $____________________per hour. The minimum billing increment is six minutes or 1/10 of an hour. Time spent on individual tasks is rounded up to the next 10th of an hour.

(For piece rate:)

Deliverables	Due Date	Payment Due
Down payment (1/3)	____________________________	$____________________________
Milestone 1	____________________________	$____________________________
Milestone 2	____________________________	$____________________________
Final Completion	____________________________	$____________________________
Total Payment	____________________________	$____________________________

82. Mutual Compromise Agreement and Mutual Release

THIS MUTUAL COMPROMISE AGREEMENT AND MUTUAL RELEASE (“Agreement”) is entered into as of ____________________, by and between ____________________(“Debtor”) and ____________________(“Creditor”) (collectively “Parties or Party”). For the purposes of the Agreement, “Party” includes subsidiaries and parents of a Party and includes individuals serving as directors, officers, employees, agents, consultants, and advisors to or of a Party.

1. Debtor and Creditor entered into an agreement or series of agreements (the “Contract”) whereby Debtor provided a series of services to Creditor for an agreed-upon fee.

2. Since the time of entering into the Contract, the Parties have determined that a settlement of the mutual obligations between them is appropriate and would best serve the interests of all of the Parties. This Agreement is intended to express the Parties’ intent to equitably settle the obligations arising from or related to the Contract.

NOW, THEREFORE, IN CONSIDERATION OF THE FOLLOWING, THE FOREGOING, THE MUTUAL COVENANTS, PROMISES, AGREEMENTS, REPRESENTATIONS, AND RELEASES CONTAINED HEREIN, AND IN EXCHANGE FOR OTHER GOOD AND VALUABLE CONSIDERATION, THE RECEIPT, SUFFICIENCY, AND ADEQUACY OF WHICH IS HEREBY ACKNOWLEDGED, THE PARTIES HEREBY AGREE AS FOLLOWS:

a. Debtor shall pay the following amounts to Creditor: ____________________, such payment to be made no later than ____________________date.

b. Debtor shall owe no further liability or obligation to Creditor in connection with any services.

2. Confidentiality. Debtor and Creditor shall keep the terms of the Agreement confidential and shall not disclose such terms to any other Party except as is necessary for the proper conduct of the disclosing Party’s business.

3. No Other Payments. No additional funds shall be required to be paid or transferred by Creditor to Debtor or by Debtor to Creditor.

4. Nature and Effect of Agreement and Conditions Thereon. This Agreement consists of a compromise and settlement by the Parties of claims arising from the Contract described in Section A, Paragraph 2, above, and a release given by the Parties relinquishing their claims against the other. By executing this Agreement, the Parties intend to and do hereby extinguish the obligations heretofore existing between them and arising from that dispute.

The nature and effect of this agreement, and the enforcement of any of the provisions found herein, is strictly conditioned upon the actions described in Paragraph 1. The shares must bear the medallion guaranteed signature of an authorized officer of the entity whose name appears on the face of the certificate and the shares must be accompanied by a resolution of the board authorizing transfer of the shares.

5. Admissions. This Agreement is not, and shall not be treated as, an admission of liability by either Party for any purpose, and shall not be admissible as evidence before any tribunal or court.

6. Compromise Agreement. The Parties hereby compromise and settle any and all past, present, or future claims, demands, obligations, or causes of action for compensatory or punitive damages, costs, losses, expenses, and compensation, whether based on tort, contract, or other theories of recovery, which the Parties have or which may later accrue to or be acquired by one Party against the other, the other’s predecessors and successors in interest, heirs, and assigns, past, present, and future officers, directors, shareholders, agents, employees, parent and subsidiary organizations, affiliates, and partners, arising from the subject matter of the claim described in Section A, Paragraph 2, above, and agree that this compromise and settlement shall constitute a bar to all such claims. The Parties agree that this compromise and settlement shall constitute a bar to all past, present, and future claims arising out of the subject matter of the action described in Section A, Paragraph 2, above.

7. Release and Discharge. The Parties hereby release and discharge the other, the other’s predecessors and successors in interest, heirs, and assigns, past, present, and future officers, directors, shareholders, agents, employees, parent and subsidiary organizations, affiliates, and partners from, and relinquish, any and all past, present, or future claims, demands, obligations, or causes of action for compensatory or punitive damages, costs, losses, expenses, and compensation, whether based on tort, contract, or other theories of recovery, which the Parties have or which may later accrue to or be acquired by one Party against the other arising from the subject of the claim described in Section A, Paragraph 2, above.

8. Unknown Claims. The Parties acknowledge and agree that, upon execution of the release, this Agreement applies to all claims for damages or losses that either Party may have against the other, whether those damages or losses are known or unknown, foreseen or unforeseen, and in the event that this Agreement is deemed executed in California, the Parties thereby waive application of California Civil Code Section 1542.

The Parties certify that each has read the following provisions of California Civil Code Section 1542: “A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor.”

The Parties understand and acknowledge that the significance and consequence of this waiver of California Civil Code Section 1542 is that even if one Party should eventually suffer additional damages arising out of the facts referred to in Section A, Paragraph 2, above, that Party will not be able to make any claim for these damages. Furthermore, the Parties acknowledge that they intend these consequences even as to claims for damages that may exist as of the date of this release but that the damaged or harmed Party does not know exist and that, if known, would materially affect that Party’s decision to execute this release, regardless of whether the damaged Party’s lack of knowledge is the result of ignorance, oversight, error, negligence, or any other cause.

9. Conditions of Execution. Each Party acknowledges and warrants that its execution of this compromise agreement and release is free and voluntary.

10. Representation of Understanding. All Parties and signatories to this Agreement acknowledge and agree that the terms of this Agreement are contractual and not mere recital, and all Parties and signatories represent and warrant that they have carefully read this Agreement, have fully reviewed its provisions with their attorneys, know and understand its contents, and sign the same as their own free acts and deeds. It is understood and agreed by all Parties and signatories to this Agreement that execution of this Agreement may affect rights and liabilities of substantial extent and degree and, with the full understanding of that fact, they represent that the covenants and releases provided for in this Agreement are in their respective best interests.

11. Construction. The provisions of this Agreement shall not be construed against either Party.

12. Entire Agreement. This Agreement constitutes the entire agreement between the Parties and signatories and all prior and contemporaneous conversation, negotiations, possible and alleged agreements, and representations, covenants, and warranties, express or implied, or written, with respect to the subject matter hereof, are waived, merged herein, and superseded hereby. There are no other agreements, representations, covenants, or warranties not set forth herein. The terms of this Agreement may not be contradicted by evidence of any prior or contemporaneous agreement. The Parties further intend and agree that this Agreement constitutes the complete and exclusive statement of its terms and that no extrinsic evidence whatsoever may be introduced in any judicial or arbitration proceeding, if any, involving this Agreement. No part of this Agreement may be amended or modified in any way unless such amendment or modification is expressed in writing signed by all Parties to this Agreement.

13. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument. When all of the Parties and signatories have executed any copy hereof, such execution shall constitute the execution of this Agreement, whereupon it shall become effective.

14. Governing Law. THIS AGREEMENT WILL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF ____________________AND THE UNITED STATES OF AMERICA, WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES. This Agreement shall not be strictly construed against any Party to this Agreement. Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall be resolved by arbitration administered under the rules of the American Arbitration Association in accordance with its applicable rules. Such arbitration shall take place within San Mateo County, California, and shall be binding upon all Parties, and any judgment upon or any an award rendered by the arbitrator may be entered in any court having jurisdiction thereof.

15. Binding Effect. The provisions of this Agreement shall be binding upon and inure to the benefit of each of the Parties and their respective successors and assigns. Nothing expressed or implied in this Agreement is intended, or shall be construed, to confer upon or give any person, partnership, or corporation, other than the Parties, their successors and assigns, any benefits, rights, or remedies under or by reason of this Agreement, except to the extent of any contrary provision herein contained.

16. Authority. The Parties hereto represent and warrant that they possess the full and complete authority to covenant and agree as provided in this Agreement and, if applicable, to release other Parties and signatories as provided herein. If any Party hereto is a corporation or limited liability company, the signatory for any such corporation or limited liability company represents and warrants that such signatory possesses the authority and has been authorized by the corporation or limited liability company to enter into this Agreement, whether by resolution of the board of, upon the instruction by an authorized officer of, as authorized in the bylaws of the corporation on whose behalf the signatory is executing this Agreement, or otherwise.

17. Severability. If any provision of this Agreement is held by a court to be unenforceable or invalid for any reason, the remaining provisions of this Agreement shall be unaffected by such holding.

18. Exchanges by Fax. The exchange of a fully executed Agreement in counterparts or otherwise by fax shall be sufficient to bind the Parties to the terms and conditions of this Agreement.

IN WITNESS WHEREOF, the Parties and signatories execute this Agreement on the dates indicated.

_________________“Debtor”

Signature__________________

_________________“Creditor”

Signature__________________

83. Checklist for a Buyer’s Purchase Order

❏ Definitions for capitalized terms

❏ Limit right to take actions affecting agreement to authorized buyer and member of management

❏ Order acceptance

• On written acceptance from seller

• On expiration of time period

• On shipment

• Payment not final acceptance

• Acceptance not waiver of latent defects

• Testing and inspection at anytime during and after manufacture

• Must meet specifications

• No substitutions without consent

❏ Seller may not manufacture in advance of buyer’s needs

❏ Buyer has right to require progress reports on orders

❏ Product rejection

• At buyer’s option may return for credit or replacement, halt at plant for correction, or keep if adjustment in price

❏ Buyer’s changes to order

• Process for initiating changes

• Changes at any time

• Changes can be specifications, delivery date, drawings, designs, packaging, destination, schedule, inspection, quantities, and suspension of manufacture

• Notification of additional charges

• Notification of additional time for delivery

• As stated in buyer’s PO

• No extra charges

• No greater than lowest prevailing price offered to any customer

• What is to be included in invoice detail

• Cash discount and how calculated

• When time period for determining cash discounts begins

• Payment due dates

• Invoice intervals

• Payments in what currency

• Payments to be made by cash, check, electronic funds transfer or other

• Buyer has right to set off any amounts owed by seller

• Notification of drop shipment

• Notification of actual or expected delay

• Title and risk of loss passes at delivery to buyer

Designation of carrier

• Packaging and labeling requirements

• No advance delivery

• If advance delivery, returned or stored at seller’s cost

• Seller to pay rush delivery if needed to meet delivery date

❏ Time of essence to buyer only

❏ Returns - process

• Passed on to buyer’s customer

• Free from defects in design, workmanship, and materials

• Conforms to specifications, drawings, samples, advertising literature

• Warranty period – period of time, period of use, or period of performance

• Warranty period for repaired products

• Warranty period for refurbished products

• Merchantable

• Fit for intended purpose

• Free of defects in title

• Does not infringe any patent, copyright, mask work or other intellectual property right

• Packaged to protect from damage

• Remedies for breach of warranty at buyer’s option

• Remedies include repair, replace, refund or buyer may fix and charge seller

• Remedies not exclusive

❏ Buyer expressly objects to any conflicting terms in seller’s PO

❏ Corrective action plan required on notice by buyer

❏ No credit hold without notice

❏ Taxes included in price

❏ No gratuities to staff or families of staff

❏ Patent Infringement

• Indemnification for all products

• Includes claims of unfair competition

• Retain right to defend and settle

• Seller must procure for buyer right to use product

• Seller must modify product to become non-infringing

• Seller must replace product with non-infringing product

• Seller must refund price

❏ Termination provision

❏ Any breach or material breach

❏ Fails to perform

❏ Performs unsatisfactorily

❏ Fails to make progress

❏ Right to cure period

• For convenience

❏ At any time

❏ Work stops immediately

❏ If partial cancellation, work continues on remainder of order

❏ Amount of payment to seller for cancellation of custom products by period of time between cancellation and delivery date

❏ Amount of payment for cancellation of stock products if any

❏ Limit on time to claim payment for a cancellation

• Assignment for benefit of creditors

• Receiver appointed

• Initiates reorganization

❏ Closes business

❏ Stops operating

❏ Buyer has right to manufacture if seller ceases business

❏ Conflicting language between agreements resolved in what manner

❏ Confidential information

• How defined

• What are acceptable uses and disclosures

• Term of confidentiality obligations

• Duties towards confidential information

• Exceptions to duties of confidentiality

❏ No implied licenses to buyer’s information or property

❏ Alternative dispute resolution

• Negotiation

• Arbitration

• If don’t want any of these include provision specifically rejecting

• Is alternative exclusive or required before litigation

• Who pays for alternative

• Who specifically is required to participate in alternative

• Qualifications of neutral party officiating over the alternative

• What is the timeframe for alternative

• Where does alternative dispute forum occur

• What rules govern alternative dispute forum

• If neutral party renders a decision is it binding

• Seller to provide

• To buyer, officers, employees, consultants, directors, agents, parent, subsidiary

• Claims, liabilities, losses, damages, costs, charges, attorneys’ fees, legal costs, liens, death, personal injury, accidents, property damage.

• Arising out of actual or alleged defects in material and workmanship, negligence, gross negligence, breach of the contract, claims of liens or encumbrances

❏ Limitation on liability

• Consequential damages- special, indirect, incidental, exemplary

• Limit on damages

❏ Requirement to obtain and maintain insurance

• Contract liability, comprehensive, general, automobile liability, workers’ compensation, product liability.

• Insurance certificates required to be produced

• Named insured

❏ Compliance with laws

• Requirement to obtain permits and licenses

• Comply with OSHA, hazardous materials laws

• Label hazardous materials

• Provide material safety data sheet on any chemicals

• If hazardous materials in products, inform in writing

• If defects become known must inform buyer

• Allow with other party’s written consent not to be unreasonably withheld

• Allow for your company at its discretion

• Prohibit entirely

❏ Choice of law to interpret contract

❏ Recovery of prevailing party’s expenses in litigation

• Attorneys fees

• Legal costs

• Expert witness fees

❏ Investigation costs

❏ Severability—illegal or otherwise unenforceable provisions can be severed

❏ Waiver—waiver of breach not agreement to waive all breaches

❏ Assignment/subcontracting permitted

• Preclude partial or complete assignment but allow subcontracting

• Preclude subcontracting but allow partial or complete assignment

• Allowed with consent not to be withheld unreasonably

• Allowed with consent at other party’s sole discretion

• Allowed if a party is sold

• Allowed if a party is transferred to an affiliate or subsidiary

• If subcontractor’s permitted will sub be required to maintain company confidential information

❏ Choice of venue for litigation

❏ Rights provided in contract are cumulative or exclusive

❏ Force Majeure – consider inclusion of fire, accident, acts of public enemy, terrorism, severe weather, acts of God, labor disruption, flood, failure of suppliers to deliver, difficulty obtaining supplies, epidemics, nuclear strike, government intervention, government or freight embargo, quarantine, difficulty obtaining transportation

• Notice required if event occurs

• Right to terminate if event lasts specified amount of time

• Integration (or Entire Agreement) provision

• All documents making up the agreement referenced

• Notice provision

• Are both parties addresses included

• Acceptable delivery methods

• Time that the other party is deemed to have received the notice specified

❏ No joint venture, agency, partnership, trust, or association

❏ Successors and assigns – agreement binding on

❏ Survival—certain terms of the agreement may survive termination

❏ Written modification – all modifications in writing and signed

❏ If terms on back of a form, does the front call attention to the terms

❏ Will Buyer provide tooling or otherwise have its own property at seller

• Seller must insure it, label it as buyers, separate it from other property, return it in good condition, and secure it

• Buyer may enter and inspect it at any time

84. Checklist for Modifying or Extending an Existing Contract

❏ Document is numbered in title

❏ Clearly states it is an amendment, modification or supplement

❏ Refers to name and date of original agreement

❏ Refers to parties of original agreement

❏ States parties have received good and valuable consideration for modification

❏ Effective date

❏ States term being deleted and states its replacement

❏ States term being modified and how it is modified

❏ Includes terms to be added

❏ Correct signature blocks and dates

❏ Agreement signed and initialed on all pages by both parties

85. Checklist for Sales Agreements Where Your Company Is the Seller

❏ The checklist for purchase orders is applicable for sales agreements with the addition that a ?sales agreement needs:

❏ Correct legal name of parties

❏ Effective date of contract

❏ No third party beneficiaries

❏ Correct signature blocks

❏ Agreement signed and each page initialed by both parties

86. Terms of Purchase

Indemnification. Each Party shall indemnify and hold harmless the other, its parent, subsidiaries, affiliates, successors, assigns, employees, officers, directors, agents, or subcontractors from and against any and all suits, claims, losses, forfeitures, demands, fees, damages, liabilities, costs, expenses, obligations, proceedings, or injuries, of any kind or nature, including reasonable attorneys fees which that Party may hereafter incur, become responsible for, or pay out as a result of the other Party’s breach of any term or provision of this Agreement, or a claim of lien or encumbrances made by third parties.

Assignment. Neither Party may assign or otherwise transfer this Agreement without the prior written consent of the other.

LIMITATION OF LIABILITY. IN NO EVENT SHALL EITHER PARTY BE LIABLE IN CONTRACT, TORT OR OTHERWISE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND, INCLUDING, WITHOUT LIMITATION, ECONOMIC DAMAGE OR LOST PROFITS, REGARDLESS OF WHETHER EITHER PARTY SHALL BE ADVISED, SHALL HAVE OTHER REASON TO KNOW, OR IN FACT SHALL KNOW OF THE POSSIBILITY.

Forum and Legal Fees. Should legal action arise concerning this Agreement, the prevailing party shall be entitled to recover all reasonable attorneys’ fees and related costs, in addition to any other relief which may be awarded by any court or other tribunal. The Parties agree that prior to initiating any legal proceedings against the other, the Parties will engage a neutral mediator who will be charged with assisting the parties to reach a mutually agreeable resolution of all contested matters. The mediation shall take place in Ingut, Noodle USA and will be conducted in the English language. The mediator shall be chosen by mutual agreement of the Parties and the mediator’s fees shall be borne equally by the Parties. In the event that a mediator cannot be agreed on by the Parties, each Party shall chose a mediator and the two mediators shall together chose a third mediator who will conduct the mediation. The costs of the two mediators chosen to choose the third mediator shall be borne equally by the Parties. The Parties agree to participate in the mediation in good faith.

Severability. If any provision of this Agreement is held by a court of law to be illegal, invalid or unenforceable, that provision shall be deemed amended to achieve as nearly as possible the same economic effect as the original provision, and the legality, validity and enforceability of the remaining provisions of this Agreement shall not be affected or impaired.

Waiver. No term or provision hereof will be considered waived and no breach of this Agreement excused unless such waiver or consent is in writing. The waiver or consent to a breach of any provision of this Agreement shall not operate or be construed as a waiver of, consent to, or excuse of any other or subsequent breach.

Conflicts Between Documents. These terms shall control over any conflicting terms in any other document which might be exchanged related to this transaction.

Force Majeure. Neither Party shall be held responsible for any delay or failure in performance of any part of this Agreement to the extent such delay or failure is caused by fire, flood, explosion, terrorism, war, embargo, government requirement, civil or military authority, act of God, or other similar causes beyond its control and without the fault or negligence of the delayed or non-performing Party. The Party so affected shall notify the non-affected Party in writing within ten (10) days after the beginning of any such cause that would affect the Party’s performance.

Successors and Assigns. The Parties intend this Agreement to bind any and all of the Parties’ successors, heirs, and assigns.

Survival. All provisions that logically ought to survive termination of this Agreement shall survive.

Entire Agreement. This Agreement supersedes, terminates, and otherwise renders null and void any and all prior written or oral agreements or understandings between the Parties relating to the subject matter of this Agreement. Except as otherwise provided in this Agreement, only a written instrument signed by both Parties may modify this Agreement.

87. Terms of Sale

1. Order Acceptance. Acceptance of buyer’s order is subject to credit approval.

2. Price. Prices shall be those in effect at time of shipment.

3. Shipping. Goods shall be shipped F.O.B. shipping point.

4. Payment. Invoices are eligible for cash discount if paid by the 10th of the month following the invoice date. All invoices are due on the 15th of the month following the invoice date. Payments not made when due shall incur a monthly service charge of the lesser of 1-1/2 percent or the maximum permitted by law.

5. Taxes. Prices do not include sales or other taxes imposed on the sale of goods which shall be separately invoiced unless Buyer provides Seller with an acceptable tax exemption certificate.

6. Returns. With Seller’s prior approval, goods may be returned for credit against unpaid invoices. The amount of the credit will be reduced by a restocking fee equal to 10% of the price of the returned goods.

7. Delivery. Seller shall not be liable for any delay in delivery that is the result of acts not under Seller’s control such as weather, strikes, and acts of God. Delivery dates are best estimates only.

8. WARRANTIES. SELLER WARRANTS THAT ALL GOODS SOLD ARE FREE OF ANY SECURITY INTEREST. SELLER MAKES NO OTHER EXPRESS OR IMPLIED WARRANTIES, AND SPECIFICALLY MAKES NO IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR PURPOSE.

9. Limitation of Liability. Seller’s liability shall be limited to either repair or replacement of the goods or refund of the purchase price, all at Seller’s option, and in no case shall Seller be liable for incidental or consequential damage of any kind for any reason.

10. Waiver. The failure of Seller to insist on the performance of any of the terms or conditions of this contract or to exercise any right hereunder shall not be a waiver of such terms, conditions or rights in the future, nor shall it be deemed to be a waiver of any other term, condition, or right under this contract.

11. Modification of Terms and Conditions. No terms and conditions other than those stated herein, and no modification of these terms or conditions, shall be binding on Seller without Seller’s written consent.

88. Examples of Legal “Boilerplate”

Assignment/Subcontracting: Four Alternatives

Neither party shall have the right to assign or subcontract any part of its obligations under this agreement.

Neither party shall have the right to assign or subcontract any of its obligations or duties under this agreement without the prior written consent of the other party, which consent shall not be unreasonably withheld or delayed.

Neither party shall have the right to assign or subcontract any of its obligations or duties under this agreement, without the prior written consent of the other party, which consent shall be in the sole determination of the party with the right to consent.

Notwithstanding the foregoing, either party may, without the consent of the other party, assign the agreement to an affiliate or subsidiary or to any person that acquires all or substantially all of the assets of a party.

Attorneys Fees

The non-prevailing party in any dispute under this Agreement shall pay all costs and expenses, including expert witness fees and attorneys’ fees, incurred by the prevailing party in resolving such dispute.

Choice of Law or Governing Law

This Agreement shall be governed by and construed in accordance with the internal laws of the State of ____________________U.S.A., without reference to any conflicts of law provisions.

Choice of Venue

Each party hereby submits to the exclusive jurisdiction of, and waives any venue or other objection against, any federal court sitting in the State of ____________________, U.S.A., or any ____________________state court in any legal proceeding arising out of or relating to this Contract. Each party agrees that all claims and matters may be heard and determined in any such court and each party waives any right to object to such filing on venue, forum non convenient or similar grounds.

Compliance with Laws

Each party shall comply in all respects with all applicable legal requirements governing the duties, obligations, and business practices of that party and shall obtain any permits or licenses necessary for its operations. Neither party shall take any action in violation of any applicable legal requirement that could result in liability being imposed on the other party.

The terms of this Agreement shall control over any conflicting terms in any referenced agreement or document.

Cumulative Rights

Any specific rights or remedy provided in this contract will not be exclusive but will be cumulative of all other rights and remedies.

Force Majeure

Neither Party shall be held responsible for any delay or failure in performance of any part of this Agreement to the extent such delay or failure is caused by fire, flood, explosion, war, embargo, government requirement, civil or military authority, act of God, or other similar causes beyond its control and without the fault or negligence of the delayed or non-performing Party. The affected party will notify the other party in writing within ten (10) days after the beginning of any such cause that would affect its performance. Notwithstanding, if a party’s performance is delayed for a period exceeding thirty (30) days from the date the other party receives notice under this paragraph, the non-affected party will have the right, without any liability to the other party, to terminate this agreement.

Each Party shall indemnify, defend and hold the other Party harmless from and against any and all claims, actions, suits, demands, assessments or judgments asserted and any and all losses, liabilities, damages, costs and expenses (including, without limitation, attorneys’ fees, accounting fees and investigation costs to the extent permitted by law) alleged or incurred arising out of or relating to any operations, acts or omissions of the indemnifying Party or any of its employees, agents, and invitees in the exercise of the indemnifying Party’s rights or the performance or observance of the indemnifying Party’s obligations under this Agreement. Prompt notice must be given of any claim, and the Party who is providing the indemnification will have control of any defense or settlement.

Each party agrees to maintain insurance in commercially reasonable amounts covering claims of any kind or nature for damage to property or personal injury, including death, made by anyone, that may arise from activities performed or facilitated by this contract, whether these activities are performed by that company, its employees, agents, or anyone directly or indirectly engaged or employed by that party or its agents.

Integration Provision or Entire Agreement

This Agreement sets forth and constitutes the entire agreement and understanding of the parties with respect to the subject matter hereof. This Agreement supersedes any and all prior agreements, negotiations, correspondence, undertakings, promises, covenants, arrangements, communications, representations and warranties, whether oral or written of any party to this Agreement.

Limit of Liability: Two Alternatives

IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER OR ANY THIRD PARTY IN CONTRACT, TORT OR OTHERWISE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND, INCLUDING, WITHOUT LIMITATION, PUNITIVE OR ECONOMIC DAMAGES OR LOST PROFITS, REGARDLESS OF WHETHER EITHER PARTY SHALL BE ADVISED, SHALL HAVE OTHER REASON TO KNOW, OR IN FACT SHALL KNOW OF THE POSSIBILITY.

IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES. SELLER’S LIABILITY AND BUYER’S EXCLUSIVE REMEDY FOR ANY CAUSE OF ACTION ARISING IN CONNECTION WITH THIS CONTRACT OR THE SALE OR USE OF THE GOODS, WHETHER BASED ON NEGLIGENCE, STRICT LIABILITY, BREACH OF WARRANTY, BREACH OF CONTRACT, OR EQUITABLE PRINCIPLES, IS EXPRESSLY LIMITED TO, AT SELLER’S OPTION, REPLACEMENT OF, OR REPAYMENT OF THE PURCHASE PRICE FOR THAT PORTION OF THE GOODS WITH RESPECT TO WHICH DAMAGES ARE CLAIMED. ALL CLAIMS OF ANY KIND ARISING IN CONNECTION WITH THIS CONTRACT OR THE SALE OR USE OF THE GOODS SHALL BE DEEMED WAIVED UNLESS MADE IN WRITING WITHIN SIXTY (60) DAYS FROM THE DATE OF SELLER’S DELIVERY, OR THE DATE FIXED FOR DELIVERY IN THE EVENT OF NONDELIVERY.

All notices shall be in writing and shall be delivered personally, by United States certified or registered mail, postage prepaid, return receipt requested, or by a recognized overnight delivery service. Any notice must be delivered to the parties at their respective addresses set forth below their signatures or to such other address as shall be specified in writing by either party according to the requirements of this section. The date that notice shall be deemed to have been made shall be the date of delivery, when delivered personally; on written verification of receipt if delivered by overnight delivery; or the date set forth on the return receipt if sent by certified or registered mail.

Relationship of the Parties

The relationship of the parties under this Agreement is that of an independent contractor and the company hiring the contractor. In all matters relating to this Agreement each Party hereto shall be solely responsible for the acts of its employees and agents, and employees or agents of one Party shall not be considered employees or agents of the other Party. Except as otherwise provided herein, no Party shall have any right, power or authority to create any obligation, express or implied, on behalf of any other Party. Nothing in this Agreement is intended to create or constitute a joint venture, partnership, agency, trust or other association of any kind between the Parties or persons referred to herein.

Severability

If any provision of this Agreement shall be declared by any court of competent jurisdiction to be illegal, void, or unenforceable, the other provisions shall not be affected but shall remain in full force and effect. If the non-solicitation or non-competition provisions are found to be unreasonable or invalid, these restrictions shall be shall enforced to the maximum extent valid and enforceable.

Successors and Assigns

This Agreement shall be binding on and inure to the benefit of the parties hereto and their respective heirs, legal or personal representatives, successors and assigns.

All provisions that logically ought to survive termination of this Agreement shall survive.

Termination for Cause

If either party breaches any provision of this Agreement and if such breach is not cured within thirty (30) days after receiving written notice from the other party specifying such breach in reasonable detail, the non-breaching party shall have the right to terminate this Agreement by giving written notice thereof to the party in breach, which termination shall go into effect immediately on receipt.

Termination for Convenience

This Agreement may be terminated by either party on thirty (30) days advance written notice effective as of the expiration of the notice period.

Termination on Insolvency

Either party has the right to terminate this agreement where the other party becomes insolvent, fails to pay its bills when due, makes an assignment for the benefit of creditors, goes out of business or ceases production.

Failure of either party to insist on strict compliance with any of the terms, covenants, and conditions of this Agreement shall not be deemed a waiver of such terms, covenants, and conditions or of any similar right or power hereunder at any subsequent time.

Warranty Disclaimers

EXCEPT AS EXPRESSLY STATED IN THIS AGREEMENT, THE SELLER EXPRESSLY DISCLAIMS AND NEGATES ANY IMPLIED OR EXPRESS WARRANTY OF MERCHANTABILITY, ANY IMPLIED OR EXPRESS WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE, AND ANY IMPLIED OR EXPRESS WARRANTY OF CONFORMITY TO MODELS OR SAMPLES OF MATERIALS.

Written Modification

This Agreement may be amended or modified only by a writing executed by both parties.

89. Lawyer Engagement Letter

Dear ____________________,

The purpose of this letter (“Engagement Letter”) is to confirm the engagement of your firm to represent ____________________in the following legal matter: ____________________.

Our policy regarding retention of legal services is:

1. No expenditure of time or costs should be made without pre-approval of a budget defining the tasks, time, hourly rate and name of staff person conducting the task, or part thereof. I have found that this is the best way for both of us to have the same understanding about what is being done and what it will cost. ____________________will not be liable for legal fees or costs exceeding this budget without written pre-approval of such fees and costs.

2. The attached Terms and Conditions, along with this Engagement Letter, comprise the contract governing your firm’s provision of legal services to ____________________. The performance of legal services to ____________________signifies your firm’s agreement to this contract.

3. Correspondence and bills should be directed to me.

4. I will forward a letter similar to this regarding each matter in which we engage your firm. I have found that this practice clarifies, for both parties, when a discussion rises to the level of legal advice which you expect to be paid for and we expect to be billed for. Please feel free to decline to discuss matters that you expect to be paid for where you have not received an engagement letter.

We look forward to working with you on this and other matters

90. Terms and Conditions for Engagement of Outside Counsel

I. Introduction

This sets forth the Terms and Conditions (“Terms) for the engagement of outside legal counsel who provide services to ____________________.

The Legal Department seeks to provide and arrange for the highest quality legal services, provided in an expeditious and cost effective manner, consistent with the values and mission of ____________________. ____________________expects that outside counsel will not only provide high quality, cost effective legal services, but will also offer constructive and forward thinking suggestions regarding the efficient delivery of legal services in each matter for which counsel is engaged.

In evaluating the quality, effectiveness and efficiency of outside counsel’s services, ____________________ will consider the following:

a. How effectively outside counsel works with in-house attorneys and the senior executive staff, with particular emphasis on clear, concise communications;

b. The utilization of a practical, common sense approach to problem solving;

c. Judgment in balancing the need for high quality legal services against the high cost of legal representation generally;

d. Whether innovative, creative approaches to resolving problems are identified, considered and implemented;

e. The reasonableness of the time spent on tasks and projects involved in the representation;

f. The continuity of staffing on matters;

g. Whether personnel are performing work appropriate to the billing rates;

h. The appropriateness and effectiveness of outside resources suggested or used by outside counsel.

II. Working with the ____________________Legal Department

The ____________________Legal Department has responsibility for the retention and management of outside counsel for ____________________. As such, the Legal Department expects outside counsel to work closely with the responsible in-house attorney. Assignments, communication with third parties, as well as litigation and transaction strategies should be discussed with ____________________’s in-house counsel at the commencement of the engagement and regularly throughout its term.

The Legal Department will from time to time involve other outside counsel in transactions or disputes that warrant such involvement. This involvement may require that outside counsel work cooperatively with other attorneys outside ____________________, although coordination and supervision of all outside counsel remains a Legal Department responsibility. Courtesy and professionalism is expected in connection with all interactions between and among outside counsel and in-house attorneys and ____________________executives.

III. Standards of Engagements

All engagements of outside counsel require that attorneys observe the following standards when representing ____________________:

a. Confidentiality and Privacy. ____________________________________________________________is subject to laws requiring the protection of confidential and private information. Outside counsel agree to maintain the confidentiality and privacy of all records and information arising from outside counsel’s representation of ____________________.

b. Strategy. Litigation or transaction strategy should be discussed with the responsible ____________________attorney and agreed upon at an early stage. Strategy should be reviewed from time to time and should not be changed without prior concurrence of the responsible ____________________attorney.

c. Periodic Reporting. The responsible ____________________attorney should be advised promptly of any unusual adverse or positive developments such as counterclaims, new case law, or affirmative defenses that may apply. While no reporting frequency is universally required, reports should be made at reasonable intervals and whenever specific circumstances warrant. Both ____________________and outside counsel are well served by regular communication. Often outside counsel will be expected to communicate both with a responsible ____________________attorney and a responsible business executive in the matter for which outside counsel has been engaged.

d. Prior Document Review. Although prior review of all documents is not required, certain key documents in litigation or transactions should be submitted in draft form to the Legal Department prior to filing or communicating with clients. For example, contracts, legal opinions, pleadings and appellate briefs should be submitted to the responsible ____________________attorney with ample time for review.

e. Research. The selection of outside counsel is often based on the expertise and experience of a particular lawyer or lawyers within a firm. As such, basic research should not be billed to ____________________without specific authorization from the responsible Legal Department attorney.

f. Timing. As time considerations are often a critical element in the selection of outside counsel, any delay or unanticipated complications that may result in delay should be reported to the responsible ____________________attorney as soon as possible.

g. Staffing. ____________________will require that a specific attorney or attorneys be assigned to each particular matter. It is expected that, absent unforeseen circumstances, personnel specified in an engagement letter will be the only attorneys and paralegals to work on any given matter from start to finish. ____________________will not be billed for “start up” costs of educating new staff due to personnel changes within the firm. Therefore, it is expected both as a matter of client relations and professional responsibility that attorneys assigned have the requisite skill and expertise necessary to represent ____________________effectively. ____________________will not be billed for time required for attorneys to become competent in areas outside of their acknowledged expertise. Every effort should be made with regard to maintaining the continuity of staffing a particular matter. The number of different lawyers who work on a particular matter should be held to the minimum number of lawyers needed to handle the matter efficiently. We encourage the use of less experienced attorneys and paralegals where appropriate. Attorneys should not perform a task for which a paralegal is qualified nor should a paralegal perform a task for which an administrative assistant is qualified. We expect only one attorney from the firm to attend meetings, depositions and arguments, unless prior arrangements and approval have been received from the responsible ____________________attorney.

h. Billing Matters. ____________________will not pay for time spent in administrative tasks such as opening a file, clearing conflicts of interest, preparing or reviewing invoices, discussions with in-house counsel regarding the contents of an invoice or time spent on matters solely for the convenience of outside counsel. Time spent on preparing a strategic plan or budget will be paid for at the agreed upon billing rates. Travel time however is not reimbursed unless the time is actually used in performing services for ____________________or is otherwise arranged with the responsible ____________________ attorney.

i. Media Coverage. ____________________has an experienced communications department and does not routinely authorize outside counsel to discuss ____________________matters with the media. Any media inquiries relating to ____________________or a matter for which outside counsel has been engaged, should be referred to the ____________________attorney. In some cases, the ____________________Communications Department may request that outside counsel represent ____________________with the media, but such arrangements must be made in advance and is solely within the discretion of the responsible ____________________attorney.

IV. Consultations

____________________values outside counsel’s expertise and advice and is always interested in steps that may be taken by ____________________to reduce legal exposure. Therefore outside counsel will periodically meet with the responsible ____________________attorney to review complex transactions, or cases in progress and discuss recommendations for a particular matter and for future business planning. Depending upon the circumstances, meetings may be held with General Counsel or other ____________________lawyers, management staff, or members of the research staff or board of directors.

V. Client Communications/Representation

All client contact, information and communication should take place through the Legal Department. All requests for ____________________or its affiliates’ documents, results of internal investigations, data, or interviews should be coordinated through the Legal Department unless the responsible ____________________attorney directs otherwise. Outside counsel may be asked to represent ____________________affiliate corporations and sometimes the officers, directors and employees of these corporations. Therefore, although outside counsel may have multiple clients through such arrangement, the Legal Department will continue to be responsible to coordinate all legal services and communication with all such clients should include the responsible ____________________attorney unless conflicts or other considerations necessitate otherwise.

VI. Service of Process/Documents

____________________’s statutory agent for Service of Process will insure that any Service of Process, including any summons and complaints or other pleadings that are served on ____________________will be forwarded to outside counsel in a timely manner. It is the responsibility of outside counsel to establish a litigation file and docket all pleadings so that timely responses are filed and no default is entered against ____________________or any __________________________________ affiliate.

VII. Billing Practices and Format

Use of proper billing practices and billing formats are of critical importance to insure payment for outside counsel services. As such all outside counsel providing services are requested to comply with following standards for billing.

a. Billing Rates. Before the commencement of work, an engagement letter must be executed. It will include the hourly rates agreed upon for all attorneys and paralegals providing services on a particular matter. There should be no increase in the hourly rates established for the individuals working on __________________________________ matters during the calendar year. Any proposed increase in hourly rates should be communicated to the Legal Department before January 1.

b. Billing. A task-based billing format should be used for all invoices submitted to __________________________________. Task-based billing formats require three elements: First, the outside counsel must record time in a single activity entry. Second, the time records must demonstrate a minimum amount of descriptive detail so that the billing data is intelligible upon review. Third, the time records should organize billing data on a task basis showing exactly what work was done during the billing period, who performed it and how much time was spent on each task and the hourly rate for that individual. Office conferences and third party communications should always identify the other participant to the topic discussed.

c. No Block Billing. Counsel should not combine different tasks performed by an attorney during one day that relate to a single billable matter into a single “block” entry. This practice makes it impossible to understand how much time was devoted to each of the several tasks combined in a single entry. __________________________________ will not honor invoices submitted using this format.

d. Costs and Disbursements. All costs and disbursements (including lodging, travel, out-of-pocket expenses, copying service, transcripts and the like) must be included in the firm’s statements with supporting documentation for all lodging and travel expenses (other than nominal amounts) and for any individual item whose cost is $25 or more. All expenses shall be the reasonable necessary actual net costs incurred and paid by the firm. All expenses are to be billed at cost. Please note that air travel, if any, must be at coach rates, advance purchase discount travel, otherwise expressly authorized by the responsible __________________________________ attorney. Expenses for lodging, meals and transportation shall be at reasonable rates and counsel must exercise prudence at incurring such expenses. Travel time, including time spent traveling from a local office to our facilities, will not be reimbursed unless the time is actually spent performing services for __________________________________. Non-reimbursable expenses include avoidable charges for unused guaranteed hotel reservations and charges for hotel movies and airline headsets, recreation and health club facilities, personal trip insurance, and other personal expenditures.

e. Overhead Expenses. Routine overhead costs, including, for example, administrative services, library services, clerical support, office supplies, postage, office copying, telecopying or fax filing, local telephone, file indexing, bill preparations, staff overtime, word processing and meals and snacks (unless while traveling out of town) shall be considered as included in the firm’s hourly fees and not charged to ________________. _________________ will not pay for time spent in firm administrative tasks, such as opening a file, clearing conflicts of interest, preparing and reviewing invoices, discussion with in-house counsel regarding the contents of an invoice or time spent on matters solely for the convenience of counsel.

VIII. Budgets

_________________ expects outside counsel to develop a project budget for each matter. _________________ understands the difficulty of predicting the amount of work required in a particular case or transaction; much depends upon the action and reactions of third parties. A request for a budget is a request that outside counsel make a conscientious effort to advise ____________________ of the various components of work that will be required in any representation and to consider how much work might reasonably cost so that the _______________ Legal Department can make an informed decision regarding whether and how to proceed with the matter. Budgets should address the following:

a. Transaction Matters:

1. Identify the attorneys proposed to work on the transaction team. This should have been already reflected in the Engagement Letter.

2. Describe the broad paths expected to be required, e.g., key documents to be drafted, issues to be researched. If these are known, identify them specifically and approximate the number of hours required to perform them.

3. Describe the broad tasks that might be required. Even if the particular tasks are only a possibility rather than a likelihood, describe them and approximate the number of hours required in case the need arises.

4. Describe any travel and/or out of town meetings that are to be expected and the approximate cost of each.

5. If you feel that the budgeted numbers reflect an amount that does not adequately address the full range of a firm’s work on a particular transaction or case, provide the additional information necessary in order to enable the responsible attorney to obtain a realistic picture of what the costs of the engagement may involve.

b. Litigation: Depending on the type of case, a budget will be required either for the complete handling of a case (from assignment through trial) or for particular periods, (e.g., the first 3 months of the case, followed by another budget for the following period; or for a period through discovery; then pretrial motions and then through trial).

IX. Settlement

The Legal Department is responsible to work with outside counsel regarding settlement of any litigation matter. The settlement of any case in litigation requires the approval of the General Counsel. Certain substantial settlements will also require the involvement of _______________________’s President.

X. Conflicts of Interest

__________________ not, as a policy matter, prohibit a lawyer or law firm in all cases from representing clients whose interest have been or could become adverse to _________________. However __________________ retains the prerogative, where a conflict could arise or has arisen, to object to the representation and require the withdrawal of counsel in accordance with applicable professional rules. __________________ requires that outside counsel identify and discuss with the responsible __________________ attorney any potential legal conflicts or business conflicts that may arise affecting the engagement of the firm.

91. Service Evaluation and Repair Agreement

092

1. Terms. The Diagnostic Fee must be paid when the item is checked in for service and is non-refundable. When Company has completed its examination of the equipment, Company will contact the owner listed above to discuss the results of the examination. Owner may be presented with a Repair Price Quote. If a Repair Price Quote is provided, Owner must authorize the repair before Company will proceed to repair the Equipment. If the Repair is authorized the Diagnostic fee paid by Owner will be credited towards the Repair Price Quote

2. Repair Price Quotes. The price quoted to repair the Equipment is good for 5 business days from the date the Owner is notified by phone of the Quote. On the expiration of the fifth business day the Quote will no longer be honored and the Equipment must be picked up by Owner within thirty (30) days. Company relies on the Owner to accurately describe all problems in order to properly determine the cost of repair. If the problem description proves to be inaccurate or incomplete, additional charges may apply. Company may not be able to repair your Equipment through no fault of Company’s and you will be informed if this is the case.

3. Warranty. Company’s technicians will use generally recognized commercial practices and standards to resolve all reported issues. Company will re-repair any repair not performed in accordance with the foregoing warranty, provided that Company receives notice from Owner within thirty (30) days after the Equipment is returned to Owner. If Company is unable within a reasonable time to re-repair the Equipment, Company will refund the Repair Price Quote paid by Owner. These warranties will not apply if Company determines that the re-repair is due to improper or inadequate maintenance or calibration or improper use or operation of the Equipment. THE ABOVE WARRANTIES ARE EXCLUSIVE AND NO OTHER WARRANTY, WHETHER WRITTEN OR ORAL, IS EXPRESSED OR IMPLIED. COMPANY SPECIFICALLY DISCLAIMS THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

4. Abandonment. Equipment not picked up by the Owner within 30 days of the date the Diagnostic Fee is paid is considered abandoned without notice and becomes the sole property of Company, which may dispose of the Equipment in any manner it chooses without payment or notice to Owner.

5. Limitation of Liability. COMPANY’S LIABILITY TO OWNER UNDER THIS AGREEMENT FOR DAMAGES OR LOSSES OF ANY KIND OR NATURE RESULTING FROM COMPANY’S BREACH OF THIS AGREEMENT OR NEGLIGENT CONDUCT SHALL BE LIMITED TO THE AMOUNT PAID TO COMPANY BY OWNER UNDER THIS AGREEMENT.

6. Complete Agreement. This agreement constitutes the complete agreement between Company and Owner and supersedes all prior or contemporaneous agreements or representations, written or oral, concerning the subject matter of this agreement. This agreement may not be modified or amended except in writing signed by Company and Owner (no other act, document, usage or custom shall be deemed to amend or modify this agreement).

Acceptance of Terms and Authorization for Evaluation

My signature below indicates that I accept these terms and conditions and authorize Company to conduct any and all evaluations which it, in its sole discretion, determines are necessary to diagnose the condition of the equipment listed above.

093