EXHIBIT 10.7
MASTER SERVICES AGREEMENT
This Master Services Agreement (the "AGREEMENT") between Web Tools
International, Inc., a Delaware corporation ("CONTRACTOR"), and AccuPoll, Inc.,
a Delaware corporation ("BUYER") is effective April 1, 2002 (the "EFFECTIVE
DATE"), with reference to the following facts:
A. Buyer is engaged generally in providing electronic voting systems
and election management services.
B. Contractor is engaged generally in the delivery of Internet
technology solutions and general software engineering services.
C. Buyer and Contractor have reached this agreement pursuant to which
Contractor will provide services to Buyer.
NOW, THEREFORE, in consideration of the mutual agreements of the
parties and other good and valuable consideration, receipt of which is hereby
acknowledged, the parties agree as follows:
1 CONTRACTOR SERVICES.
1.1 STATEMENTS OF WORK.
Buyer may from time to time in its discretion invite Contractor to
undertake projects under this Agreement by delivering to Contractor a
description of such projects, the services to be performed and deliverables to
be provided by Contractor thereunder, the terms of payment by Buyer therefor,
and any other relevant terms and conditions. If Buyer and Contractor agree upon
such a project and manifest their agreement by executing and delivering a
written document to that effect in the form of Exhibit B hereto, or another form
that states that it is entered into pursuant to this Agreement, such document
will constitute a "STATEMENT OF WORK" under, and will form a part of, this
Agreement.
1.2 SERVICES AND DELIVERABLES.
Contractor will provide the professional staff, services ("SERVICES")
and tangible items (such as reports, documents and code) ("DELIVERABLES")
described by Statement(s) of Work. Deliverables must be in a form approved by
Buyer. If Buyer requests additional services or deliverables, and Contractor
agrees in writing to perform or provide them, through supplements to a Statement
of Work, change orders or other appropriate documents, the additional services
and deliverables will be deemed "Services" and "Deliverables" subject to this
Agreement.
1.3 STAFFING AND MATERIALS.
(a) Contractor shall select and assign personnel of Contractor who, in
Contractor's reasonable judgment, are appropriately qualified to perform the
Services or provide the Deliverables. All assignments of Contractor's personnel
to perform the Services and/or provide the Deliverables (other than incidental
assistance) shall be subject to Buyer's approval, which (i) shall not be
unreasonably withheld, (ii) shall not be required for incidental or occasional
substitutions (E.G., on account of illnesses or vacations). Buyer may, in its
discretion require Contractor to replace any particular Contractor personnel
working under this Agreement. Contractor will not remove or reassign personnel
working under this Agreement, but personnel changes caused by resignations,
illnesses, family emergencies, and other circumstances beyond Contractor's
reasonable control are permissible provided that Contractor works in good faith
to provide replacement personnel who are reasonably acceptable to Buyer. All
personnel of Contractor assigned to Buyer to perform the Services or provide
Deliverables shall at all times remain employees of Contractor. As a condition
of their assignment to Buyer, each individual so assigned may be required to
execute and deliver to Buyer an agreement in form satisfactory to Buyer
substantially to the effect of Section 4.3 regarding confidentiality and
assignment to Buyer of inventions and works of authorship created in the scope
of provision of the Services or Deliverables.
(b) Except as specifically provided for in a Statement of Work, Buyer
shall be under no obligation to supply Contractor or any of its designated
personnel with office space, secretarial assistance, or other assistance or
support services. Contractor will provide all tools and other resources required
to perform under this Agreement, except to the extent that any Statement of Work
specifically provides for tools or resources to be provided by Buyer.
1.4 SUBCONTRACTORS.
Contractor may not engage subcontractors to assist in performance under
this Agreement without Buyer's written approval, which Buyer may give or
withhold in its sole but reasonable discretion and may condition on such
additional agreements as Buyer, in its sole discretion, sees fit. In the event
Buyer does consent to the use of one or more subcontractors, Contractor shall
nonetheless remain responsible for all Services and Deliverables, and will be
responsible for securing written agreements for the adherence of subcontractors
and their employees to all applicable terms and conditions of this Agreement,
including without limitation Section 4 of this Agreement.
1.5 CHANGE CONTROL.
Buyer or Contractor may propose changes in Services and Deliverables by
delivering to the other a written change order proposal describing the proposed
change, any proposed price adjustments for such requested changes, time
schedules and other anticipated effects (for example, upon the performance of
systems). The non-requesting party shall respond to a change proposal within a
reasonable period of time in light of the scope and timeliness of the change,
and in any event within such reasonable time as Buyer may specify to conform to
its clients' requirements. Change proposals that are mutually acceptable will be
reflected in a written change order in mutually agreeable form, which when
signed by Contractor and Buyer will modify the applicable Statement of Work as
specified in such change order. Unless and until a change proposal is agreed as
a change order, Contractor shall continue to render the Services and deliver the
Deliverables unmodified from prior specifications as set forth in the relevant
Statement of Work, unless Buyer notifies Contractor of the effectiveness of an
alternative arrangement pursuant to which Buyer or another contracting party
will undertake for the additional or changed work requested and declined, at
which point Buyer and Contractor will work together to identify and agree upon
any change to any Statement of Work necessary or appropriate in light of the
work undertaken by Buyer or the third party.
1.6 NO RIGHTS
The relationship between Buyer and Contractor is discretionary and
non-exclusive. Buyer is not obligated to issue or offer to Contractor any
particular Statements of Work or to engage Contractor to perform any particular
projects or level of work. Contractor has no rights to any specific engagements,
territories, prospects or other commitments from Buyer other than as set forth
in this Agreement or a Statement of Work. Contractor is not obligated to accept
any Statement of Work offered by Buyer and, subject to the specific restrictions
set forth in this Agreement, Contractor may undertake any work for any third
party.
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2 FEES AND CHARGES.
2.1 CHARGES FOR SERVICES AND DELIVERABLES.
Buyer shall pay for Services and Deliverables in accordance with the
pricing terms specified in the applicable Statement of Work. For work to be
performed on a time and materials basis, Contractor's rates will be the Basic
Rates unless otherwise specifically provided in the applicable Statement of
Work. For these purposes, the "BASIC RATES" are the rates set forth on Exhibit A
hereto, which represent Contractor's standard rates in effect as of the
Effective Date, LESS a 0% discount. The Basic Rates as applicable to Statements
of Work and change orders not yet signed and other future work may be adjusted
once annually, as, when and to the extent that Contractor adjusts its rates for
other clients, LESS, in all cases, a 0% discount. However, time and materials
rates under any particular Statement of Work will not change unless the
Statement of Work provides for change, and the rate for any individual person
who undertakes work on behalf of Contractor under any Statement of Work (a) may
not thereafter increase by more than 10% in the aggregate in any 365-day period,
for any work done under any subsequent Statement of Work, whether through
regular annual adjustment, promotion or re-classification, or otherwise; and (b)
in no case will exceed the rate charged by Contractor to third parties for that
individual, LESS, in all cases, a 0% discount. Unless and except to the extent
otherwise specified in a Statement of Work or a written consent by Buyer, Buyer
will not pay for more than eight hours of work per day, 40 hours of work per
week, performed by any single individual on a time and materials basis. The rate
billed by Contractor for any particular individual will not change as a result
of any overtime. Notwithstanding anything herein to the contrary, in any case
the rates charged by Contractor to Buyer will not exceed the rates charged by
Contractor to third parties for comparable assignments, LESS, in all cases, a 0%
discount.
2.2 PRICING OF REVIEWS.
Buyer will not be obligated to pay Contractor for responding to any
request for a Statement of Work or for changes under this Agreement or a
Statement of Work unless Buyer has agreed in advance in writing to make such
payment. If Buyer requests any Statement of Work or any changes to this
Agreement or any Statement of Work hereunder that require Contractor to
undertake detailed scoping or analysis work, Contractor may charge Buyer on a
time and materials basis, at its then current Basic Rates for such work,
provided that Contractor has notified Buyer that a response to Buyer's request
will result in a charge to Buyer and a good faith estimate of the total charge,
and Buyer has agreed thereto in writing. 2.3 MINOR REQUESTS.
Buyer may request additional services from Contractor which are of a
minor or routine nature not justifying the complete change order procedure set
forth in this Agreement. In such case, Contractor shall provide such services,
subject to availability of appropriate personnel, at the time and materials
rates set forth for similar work in a pending Statement of Work, or if no
similar rate is so set forth on a time and materials basis at the Basic Rates as
described in Section 2.1.
2.4 EXPENSES.
Subject to the restrictions in this Section 2.4, Buyer shall reimburse
Contractor for reasonable, actual out-of-pocket expenses authorized by Buyer
that are incurred by Contractor consistent with Buyer's general travel policies
in providing Services or creating or delivering Deliverables and that are
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documented with sufficient specificity to support expense recognition and tax
deductibility, when applicable ("REIMBURSABLE EXPENSES"). Reimbursable Expenses
shall be deemed authorized only if (a) of a type itemized in the Statement of
Work and not in excess of the maximums set forth in the relevant Statement of
Work, (b) incurred by Contractor after receiving written approval from Buyer,
which approval shall not be withheld unreasonably, or (c) incurred by Contractor
in order to meet emergency conditions where securing advance approval would not
be practicable. Expenses eligible for approval as Reimbursable Expenses shall
include, without limitation, coach class travel and standard business lodging
expenses, photocopying, media distribution, air and ground freight and courier
services, long distance telephone and data communications charges and the like.
Reimbursable Expenses will not include Contractor's general overhead. Contractor
recognizes the necessity of submitting expenses promptly in order to enable
Buyer to record them in appropriate accounting periods and, when appropriate, to
recover such costs from third parties. Accordingly, Buyer will not be obligated
to reimburse Contractor for any expenses that not submitted to Buyer within 30
days of the date incurred.
2.5 TAXES.
Contractor's fees and charges exclude all applicable taxes. Buyer shall
pay or reimburse Contractor for any value-added, sales, use and other taxes,
customs duties or imposts, if any, imposed on any of the Services, Deliverables,
or materials supplied by Contractor, under this Agreement. Contractor will pay
all taxes on its property and net income, and all taxes required to be withheld
from payments to persons it engages to perform services.
2.6 INVOICES, PAYMENT.
Unless another invoicing schedule is specified in the applicable
Statement of Work, Contractor shall provide monthly invoices for Services and
Deliverables provided and Reimbursable Expenses incurred. All invoices will be
in such format and detail as Buyer may reasonably require. Without limiting the
foregoing, invoices for work performed on a time and materials basis will
include detailed person-by-person daily time entries describing time spent, work
done, and results achieved on a task-by-task or step-by-step basis, as
appropriate to provide an adequate basis for evaluation of the efficiency of
Contractor's work. In addition, for work performed on a fee basis other than
time and materials, Contractor will provide progress reports at least weekly
containing substantially the same detail as the time entries described in the
preceding sentence. Buyer shall pay undisputed invoices within thirty (30) days
after receipt. Invoices shall be payable in U.S. dollars (unless otherwise
agreed for services performed in a particular country).
2.7 NONCONFORMING SERVICES AND DELIVERABLES.
Buyer will not be required to pay Contractor for Services or
Deliverables that do not conform to the general terms of this Agreement and the
Statement of Work pursuant to which they are provided, or for correcting
deficiencies in Services or Deliverables.
3 ACCEPTANCE AND WARRANTIES
3.1 ACCEPTANCE OF DELIVERABLES.
To the extent that the Statement of Work provides for the creation of
specific Deliverables, Buyer shall inspect all Deliverables promptly following
delivery and (unless the parties agree upon some longer or shorter period in a
Statement of Work) within ten (10) days after delivery, accept, partially
accept, or reject the Deliverables in writing. Rejection or partial rejection
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shall be accompanied by a written explanation of the reasons for rejection.
Unless otherwise specified in the Statement of Work, any Deliverable that is
substantially complete, free from material defects, and complies with the
Statement of Work (or any other mutually agreed acceptance criteria) and
prevailing industry standards in all material respects shall be accepted. Unless
otherwise agreed, following any rejection or partial rejection, Contractor shall
have a reasonable time (not to exceed ten (10) days) to correct any deficiencies
noted by Buyer and to resubmit the Deliverable for review and approval in
accordance with this paragraph. Acceptance of Deliverables will not waive any
contract claims by Buyer, including without limitation any claims for breach of
warranty.
3.2 LIMITED WARRANTIES.
(a) Contractor represents and warrants that (i) Contractor is an expert
in provision of Services and Deliverables of the kind to be provided under this
Agreement and any Statement of Work agreed to by Contractor; (ii) all Services
and Deliverables shall be provided in a professional and workmanlike manner,
shall be efficiently performed, and shall be of professional quality conforming
to generally accepted industry standards and the applicable Statement of Work
and shall be adequate to serve their intended purposes and achieve their
intended results as specified in the applicable Statement of Work; and (iii) all
software Deliverables will operate substantially in accordance with their
specifications and be free from material defects for a period of three hundred
sixty-five (365) days after acceptance. Contractor does not warrant that any
software Deliverables will be error-free, or operate without interruption, but
Contractor will correct errors in software Deliverables without additional cost
to Buyer.
(b) Contractor further warrants that all Deliverables and New
Developments (as defined below) shall be wholly original works of Contractor or
its Sub-Contractors as the case may be, except to the extent Deliverables and
New Developments incorporate third party system components provided by Buyer.
Contractor shall not infringe the copyrights, database rights, design rights,
patents, or trade secrets or other intellectual property rights of any third
party by providing Services, Deliverables, and New Developments, and Contractor
agrees that without limiting the foregoing, unless specifically provided to the
contrary in the Statement of Work, Buyer may make, use, sell, copy, distribute
and make derivative works from all Deliverables and New Developments, free of
any restriction, the need for any consent, or royalty payable to any third
party. Contractor warrants that neither Contractor nor any permitted
subcontractors, nor any of their respective employees, agents, or
representatives, by entering into this Agreement, using information or
materials, or performing the Services or delivering the Deliverables or New
Developments hereunder has violated or will violate any consulting, employment,
non-competition, proprietary information, confidentiality or other agreement,
arrangement, understanding, or restriction between such party and a present or
former employer, principal, client or other individual or entity.
(c) The execution, delivery and performance by Contractor of this
Agreement, and participation in performance under this Agreement by employees,
subcontractors and other representatives of Contractor, does not and will not:
(i) violate any provision of law, statute, judgment, order, writ, injunction,
decree, award, rule, or regulation of any court, arbitrator, or other
governmental or regulatory authority applicable to Contractor or any such
employee, subcontractor and representative; or (ii) violate, result in a breach
of or constitute (with due notice or lapse of time or both) a default under any
agreement or other legal obligation to which Contractor or any such employee,
subcontractor and representative is party or subject.
(d) Contractor assumes no responsibility for (i) failures of
Deliverables attributable to user errors or misuse, (ii) failures to use
corrections to Deliverables supplied by Contractor without additional charge, or
(iii) modifications to Deliverables by Buyer or any third party (other than as
contemplated by the relevant Statement of Work or Deliverable).
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(e) THE FOREGOING WARRANTIES ARE IN LIEU OF ANY AND ALL OTHER
WARRANTIES AND CONTRACTOR MAKES NO OTHER WARRANTIES, EXPRESS OR IMPLIED, WITH
RESPECT TO ANY SERVICE OR DELIVERABLE, INCLUDING WITHOUT LIMITATION ANY IMPLIED
WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
4 CONFIDENTIAL INFORMATION AND INTELLECTUAL PROPERTY.
4.1 CONFIDENTIAL INFORMATION DEFINED.
Contractor (and Contractor's representatives or personnel) may be
furnished with, receive, or otherwise have access to Confidential Information of
Buyer or Buyer's clients. "CONFIDENTIAL INFORMATION" means all information, in
any form, furnished or made available directly or indirectly to Contractor by
Buyer or Buyer's clients that relates in any way to Buyer or Buyer's clients,
employees of Buyer or Buyer's clients, or other third parties with which Buyer
has business relationships. Confidential Information INCLUDES, without
limitation, ideas, concepts, know-how, methods, methodologies, processes,
technologies, algorithms, techniques, compilations, software, personnel data,
financial data, information about clients or prospective clients and their
businesses, business strategies, service methods and infrastructure, and the
terms of this Agreement and all Statements of Work. "Confidential Information"
EXCLUDES any particular information which Contractor can demonstrate (A) was,
when disclosed to Contractor, in the public domain or commonly known in the
recipient's industry; (B) was in Contractor's possession when disclosed; (C) was
later disclosed to Contractor by a third party without breach of any legal or
contractual obligation, provided that any obligation to maintain confidentiality
during the period prior to such disclosure shall be released retroactively; or
(D) was independently developed by Contractor without use of Buyer's
Confidential Information.
4.2 PROTECTION OF CONFIDENTIAL INFORMATION.
Contractor shall protect Confidential Information with at least the
same degree of care (and in any event no less than reasonable care) that it uses
to protect its own Confidential Information, BUT (a) may disclose such
information to third parties (such as permitted subcontractors) performing
services related to the Services or Deliverables, PROVIDED that Contractor shall
cause all recipients to protect such Confidential Information in compliance with
this Agreement and will be responsible for any deviation from its requirements
concerning use and protection of Confidential Information or (b) when required
by law (but Contractor will give Buyer prompt notice of any subpoena or other
order compelling disclosure, and cooperate with Buyer's attempts to obtain a
protective order or similar protections). Contractor shall limit access to the
Confidential Information to its employees and permitted contractors actually
engaged in providing services hereunder and to those supervisory personnel with
a legitimate need to know such information and shall not use or copy any
Confidential Information, or remove any Confidential Information from premises
designated by Buyer for such use, except to the extent necessary to carry out
the purposes of this Agreement and the applicable Statement of Work. Contractor
shall return all Confidential Information to Buyer upon Buyer's request. Upon
completion or termination of each project hereunder, Contractor and its
employees and permitted subcontractors shall return to Buyer all documents or
other materials in whatever form that contain Confidential Information, destroy
all copies thereof, and certify to Buyer, in writing, that all copies of such
materials have been destroyed. Contractor shall cause its employees,
subcontractors and representatives to comply with the same restrictions on
disclosure and use of Confidential Information as are applicable to Contractor
hereunder.
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4.3 NEW DEVELOPMENTS
All ideas, inventions (whether or not patentable), concepts, knowhow,
methods, methodologies, processes, algorithms, techniques, compilations,
software and other works of authorship of any nature created or developed by
Contractor during the course of performance of this Agreement or any Statement
of Work ("NEW DEVELOPMENTS") shall be Buyer's exclusive property. All New
Developments that are works of authorship to which copyright laws might apply
are "works made for hire" under applicable copyright laws; and all New
Developments are within the scope of what Buyer is purchasing from Contractor
pursuant to this Agreement and the Statements of Work. Contractor hereby assigns
to Buyer all of Contractor's right, title and interest, past, present and
future, in all New Developments. To avoid any doubt, such rights include though
are not limited to all rights of action past, present and future and whether
actual or contingent, and Buyer may apply for or register any patents,
copyrights and other protection it deems advisable in the United States, in all
other countries worldwide and under any applicable treaties. Contractor agrees
to take, at Buyer's expense, such action as Buyer may reasonably request to
perfect Buyer's title to all New Developments (and intellectual property rights
therein) in terms of this Clause and to defend such rights and to obtain and
maintain such protection. To the extent that any such New Developments are not
specified in the Statement of Work as fully exclusive to Buyer and include
material that is of a nature such that it may be used for applications other
than those that are primary business processes of Buyer or Buyer's clients
("NON-SPECIFIC MATERIAL"), Buyer will, upon reasonable request specifying the
desired usage by Contractor, grant to Contractor a perpetual, royalty-free
non-exclusive license to make, use, sell, copy, distribute and make derivative
works from such Non-specific Material for applications that are not in
competition with products or services offered by Buyer (subject, in all cases,
to Contractor's obligations to protect Buyer's Confidential Information and the
rights of Buyer's client under any applicable prime contract). Notwithstanding
anything in this Section 4.3 to the contrary, Buyer acknowledges that Contractor
through previous study and work experience has developed certain skills and
expertise in Contractor's specialized areas of service. In the course of
Contractor's performance under Statements of Work, it is anticipated that
Contractor will enhance those skills and expertise, and, subject to compliance
with the Contractor's obligations set forth in this Agreement regarding
Confidential Information and intellectual property, nothing herein is intended
or will be construed to limit Contractor's right to use such skills and
expertise at any time.
4.4 LICENSE - USE OF CONTRACTOR INTELLECTUAL PROPERTY
Contractor grants Buyer a permanent, nonexclusive, nontransferable
(other than to successors to Buyer's business or the part of Buyer's business in
which the relevant Deliverables are used), royalty-free license to use the
intellectual property, including without limitation patents, copyrights,
database rights, design rights, trade secrets and industrial designs, created
outside the scope of the engagements contemplated by this Agreement and
Statements of Work, but which are contained in the Deliverables as supplied to
Buyer, for the purpose of operating and supporting Buyer's business (including,
without limitation, performance of services for Buyer's clients). The licenses
granted by this Section 4.4 shall survive expiration or any termination of this
Agreement or any Statement of Work hereunder.
4.5 RIGHTS IN RESIDUALS.
Nothing in this Agreement shall restrict Contractor from the use of any
ideas, concepts, know-how, methodologies, processes, technologies, algorithms or
techniques which Contractor, individually or jointly, owns prior to the
Effective Date, or develops or obtains independently during the term of this
Agreement, PROVIDED that in doing so Contractor does not breach its obligations
of confidentiality or infringe the intellectual property rights of Buyer or
third parties who have licensed or provided materials to Buyer. Except for the
license rights contained in this Article, neither this Agreement nor any
disclosure made hereunder grants any license to either Buyer or Contractor under
any patents or copyrights of the other. Except as set forth in this Agreement
and any Statement of Work, Contractor reserves all rights in its ideas,
concepts, know-how, methodologies, processes, technologies, algorithms,
techniques, compilations and other intellectual property of every kind and
description (except as otherwise expressly agreed in writing).
4.6 INJUNCTIVE RELIEF.
Each party hereto agrees that money damages would not be a sufficient
remedy for any breach of this Article 4 by either party or their respective
directors, officers, employees or agents, and that in addition to all other
available remedies the non-breaching party shall be entitled to specific
performance and injunctive or other equitable relief as a remedy for any such
breach, and the parties further agree to waive and to use their best efforts to
cause their directors, officers, employees or agents to waive, any requirement
for the securing or posting of any bond in connection with such remedy.
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5 ADDITIONAL AGREEMENTS.
5.1 INDEPENDENT CONTRACTORS.
Contractor is as an independent contractor to Buyer under this
Agreement and Contractor shall determine the method, details and means of
performing the Services and providing the Deliverables. Nothing in this
agreement shall be construed so as to constitute any employment arrangement or
any partnership or joint venture between the parties. Contractor and employees,
representatives and subcontractors of Contractor shall not be considered as
having employee status with Buyer or being entitled to participate in any plans,
arrangements, or distributions by Buyer pertaining to or in connection with any
pension, stock, bonus, profit-sharing, or similar benefits that Buyer may have
for its employees, regardless of whether the employee is classified as an
employee for any other purpose. Similarly, Contractor acknowledges that Buyer
has no obligations with respect to Contractor and employees, representatives and
subcontractors of Contractor which Buyer may otherwise have at law with respect
to employees of Buyer. Contractor shall perform and make all obligations and
payments, whether imposed by Federal, state or local law, regarding FICA, income
tax withholdings, unemployment compensation, insurance, and other similar
responsibilities related to Contractor and all employees, representatives and
subcontractors of Contractor.
5.2 INSURANCE
Contractor shall provide and maintain at its own expense during the
term of this Agreement all insurance that is reasonably necessary to cover its
obligations and liabilities under this Agreement, and shall provide Buyer with
proof of such insurance upon request.
5.3 PARTY REPRESENTATIVES.
Immediately after signing this Agreement, each party will designate one
individual to act as its Representative. In addition, each party will designate
a Project Manager for the work described by each Statement of Work, who shall
have day-to-day responsibility for management of the relevant party's
activities. Each party may from time to time appoint a successor or substitute
Representative and/or Project Manager, but will make reasonable efforts to
assure continuity. The Representative and Project Manager shall be the
authoritative points of contact between Contractor and Buyer, and shall have
authority to make all decisions required of their principals (including approval
of Deliverables and changes and amendments to this Agreement). Each party may
rely on the other Representative's decisions and instructions.
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5.4 COMPLIANCE WITH CERTAIN POLICIES.
(a) Contractor will comply with reasonable policies, practices and
procedures of Buyer and Buyer's clients, as applicable to the Services and/or
Deliverables and as disclosed to Contractor from time to time, including
(without limitation) policies, practices and procedures relating to safety,
security, data protection, data processing and confidentiality (collectively,
"RELEVANT POLICIES"), provided, however, that if Contractor is not able to
comply with any Relevant Policy without material expense or risk and Buyer
nevertheless insists upon compliance, then Contractor may terminate any affected
Statement of Work, subject to Section 7.5. Contractor shall report any alleged
or suspected violations of the Relevant Policies and cooperate with Buyer and
its clients in investigating the matter (while reserving the right to conduct
its own internal investigation), and undertake corrective action to rectify any
violation and prevent recurrence. Upon request, Contractor will demonstrate to
Buyer its compliance with the Relevant Policies. Compliance with the Relevant
Policies is in addition to, and not in place of, any corresponding requirements
of this Agreement. To the extent that the requirements of this Agreement differ
from the Relevant Policies, then the more stringent or extensive requirements
shall apply.
(b) Without limiting Section 5.4(a), Contractor and Buyer acknowledge
the importance of security and will cooperate as appropriate to address security
breaches and to enhance the security features and procedures applicable to
Contractor's provision of the Services and Deliverables.
5.5 CONTRACTOR'S THIRD PARTY COMMITMENTS.
In no event shall Contractor use in the performance of Services or
otherwise disclose to Buyer or its clients any confidential or proprietary
information of any third party without the written consent of such third party
and the prior written consent of Buyer (which consent may be withheld for any
reason or no reason). Contractor will inform Buyer before undertaking any
projects for third parties that are competitors of Buyer, or projects that could
limit Contractor's ability to perform obligations to Buyer under this Agreement.
5.6 AUDIT; RECORDS.
Buyer may, upon its request, audit any and all work or expense records
of Contractor relating to Services and Deliverables provided hereunder;
provided, however, that such audit shall occur only after ten (10) days' notice
to Contractor and shall not unreasonably interfere with Contractor's business
and/or operations. Contractor shall have the right to exclude from such
inspection any of its confidential or proprietary information. Contractor shall
not be responsible for maintaining receipt records for amounts below that which
is required by the Internal Revenue Service at the time such expense was
incurred. Contractor shall retain all records related to the work performed for
Buyer for a minimum period of one (1) year from the completion of the project,
and will inform Buyer before destroying such records and upon Buyer's request
will transfer to Buyer such records, provided that Contractor's Confidential
Information may be redacted therefrom.
6 REMEDIES AND INDEMNITIES.
6.1 MUTUAL INDEMNITY.
Each party (as indemnitor) shall indemnify, defend, reimburse and hold
harmless the other party and its affiliates (I.E. persons or entities
controlling, controlled by, or under common control with such other party) and
their respective successors and assigns, and the respective officers, directors,
employees and agents of each of them (as indemnitees) from and against any and
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all claims, losses, damages, liabilities, obligations, assessments, penalties
and interest, demands, actions and expenses, whether direct or indirect, known
or unknown, absolute or contingent (including, without limitation, settlement
costs and any legal, accounting and other expenses for investigation or
defending any actions or threatened actions) ("LOSSES") incurred by any such
indemnitee arising out of or in connection with (a) the operations of the
indemnitor and any acts or omissions by the indemnitor or its employees,
subcontractors or other representatives in performance under this Agreement or
any Statement of Work, (b) any untruth, inaccuracy or material omission in any
representation or warranty made by the indemnitor, or (c) the breach of any
covenant, agreement or obligation of the indemnitor contained in this Agreement
or any Statement of Work.
6.2 INDEMNITY AGAINST INFRINGEMENTS.
(a) If a third party claims that any Deliverables or New Developments
infringe that party's patent, copyright, trade secret or other intellectual
property or proprietary rights ("claims of infringement") then Contractor will
indemnify and defend and hold harmless Buyer and its indemnitees against that
claim at Contractor's expense, and pay all costs, damages and attorneys fees.
Contractor has no responsibility for claims that involve (i) modifications of
Deliverables or New Developments by Buyer or third parties, (ii) use with
hardware or software products for which the Deliverables or New Developments
were not intended where intended use has been notified in writing to Buyer, or
(iii) claims of infringement resulting from the combination of Deliverables or
New Developments with items specified by Buyer or nor provided by Contractor.
(b) If a third party claims that any acts or omissions of Buyer
(including Contractor's use of hardware or software provided by Buyer, but
excluding authorized use of Deliverables or New Developments) infringe that
party's patent, copyright, trade secret or other intellectual property or
proprietary rights, under circumstances not giving Buyer a right of indemnity
under the immediately preceding subparagraph, then Buyer will indemnify and
defend and hold harmless Contractor and its indemnitees against that claim of
infringement at Buyer's expense, and pay all costs, damages and attorneys fees.
(c) If Services or Deliverables or any item used by Contractor to
provide the Services or create a Deliverable becomes, or in Contractor's
reasonable opinion is likely to become, the subject of a claim of infringement,
Contractor shall, in addition to indemnifying and defending and holding harmless
Buyer, promptly take such measures as it deems advisable, which may include (i)
securing the right to continue using the item or (ii) replacing or modifying the
item to make it non-infringing, or (iii) if neither (i) nor (ii) is practicable,
removing the item from the Services or Deliverables, provided that such removal
does not cause the remaining Services or Deliverables to cease to function in
the intended manner. In that event, Contractor's charges shall be adjusted
equitably to reflect such removal. If the allegedly infringing or
misappropriated item was provided or specified by Buyer, Buyer shall bear the
cost of obtaining any necessary rights or procuring a replacement.
6.3 INDEMNIFICATION PROCEDURES.
Each party will give the other prompt written notice of all claims
subject to any of the foregoing indemnities, and cooperate in the investigation
and defense of the claim. If the indemnitor assumes defense of the claim, the
indemnitor shall control the defense and settlement of the claim, but the
indemnitee may participate and employ its own counsel at its own expense. An
indemnitor (i) has no obligation to pay any settlement reached without its prior
written consent, and (ii) may not settle an indemnified claim without the
indemnitee's prior written consent. Consents may not be unreasonably withheld or
delayed, but consent to any settlement affecting a party's intellectual property
may be given or withheld in the affected party's sole but reasonable discretion.
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6.4 LIMITATION ON LIABILITY.
Neither party shall be liable to the other party for any indirect,
special, consequential, exemplary or punitive damages (excluding only amounts of
such damages owed or paid to third parties under the indemnities above). THE
AGGREGATE LIABILITY OF ALL KINDS OF EITHER CONTRACTOR OR BUYER TO THE OTHER
UNDER THIS AGREEMENT SHALL NOT EXCEED THE AMOUNT OF PAYMENTS CONTRACTOR HAS
ACTUALLY RECEIVED OR IS ENTITLED TO RECEIVE HEREUNDER, EXCEPT IN CASES OF GROSS
NEGLIGENCE, WILLFUL MISCONDUCT, VIOLATION OF LAW, INDEMNIFICATION OF BUYER IN
CONNECTION WITH THIRD PARTY CLAIMS, INFRINGEMENT OR BREACHES OF CONTRACTOR'S
OBLIGATIONS CONCERNING CONFIDENTIAL INFORMATION.
6.5 DELAYS.
If acts or omissions of Buyer delay Contractor's performance materially
beyond scheduled completion or delivery dates, then Buyer shall pay Contractor's
reasonable additional costs (including, among others, carrying costs for
equipment and software licenses, and additional services at the rates specified
in the relevant Statement of Work, or otherwise at Contractor's standard rates,
less any applicable discount) for services performed after Contractor gives
Buyer written notice of the delay, that could not have been avoided by
reasonable efforts to mitigate the costs and effects of Buyer delays. To the
extent that Contractor is partially responsible for the delay, or fails to make
reasonable efforts to mitigate, the amount of the reimbursement shall be
proportionally reduced.
6.6 FORCE MAJEURE.
Each party's obligations and performance shall be suspended to the
extent and for the period that it is hindered or delayed by reason of delays or
causes beyond the affected party's control, including without limitation labor
disputes, acts of God, fire, storm, flood, war, theft or destruction of
equipment, transportation and delivery delays, governmental actions, orders or
decrees, or manufacturer/supplier delays, and provided further that the affected
party uses reasonable efforts to alleviate or work around the delay and continue
performance. The affected party shall give notice of FORCE MAJEURE conditions
within a reasonable time.
7 TERM AND TERMINATION.
7.1 TERM OF AGREEMENT.
The term of this Agreement ("TERM") shall commence on the Effective
Date, and continue until March 31, 2004 or until completion of the last Services
and Deliverables required by any Statement of Work, whichever is later, UNLESS
(i) the Term ends sooner, in accordance with the terms of this Agreement, or
(ii) the Term is extended by change order or other written agreement of the
parties.
7.2 TERMINATION FOR CONVENIENCE.
Buyer may terminate this Agreement, or any Statement of Work hereunder,
at any time, by giving Contractor at least thirty (30) days' written notice.
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7.3 TERMINATION FOR CONTRACTOR'S DEFAULT.
If Contractor (i) commits a material breach of this Agreement or any
Statement of Work that is capable of being cured within fifteen (15) days and
fails to (A) proceed promptly and diligently to correct the breach, and (B) cure
the breach to Buyer's reasonable satisfaction within TEN (10) days after
receiving notice; (ii) commits a material breach of this Agreement which, by its
nature, cannot be cured; (iii) manifests lack of appropriate qualifications to
perform the work required under this Agreement or any Statement of Work; (iv)
provides Services or Deliverables that do not conform to the Statement of Work
pursuant to which they are provided or (v) becomes unable to pay its debts as
they come due or makes a voluntary filing, or fails to cause to be dismissed
within 30 days any involuntary filing, under any bankruptcy or other law for the
protection of creditors' rights generally, then Buyer may (without limitation on
other remedies that may be available to it under this Agreement, at law or in
equity), by giving written notice to Contractor, terminate this Agreement or
some or all Statements of Work as of any date specified by Buyer in the notice
of termination.
7.4 TERMINATION FOR BUYER'S DEFAULT.
If Buyer fails to pay Contractor when due any undisputed charges under
the Agreement and thereafter fails to make such payment within fifteen (15) days
of notice from Contractor of the failure to make such payment, then Contractor
may terminate this Agreement or any Statement of Work without further notice.
7.5 EFFECT OF TERMINATION
(a) If Buyer terminates this Agreement or any Statement of Work with
notice, then during the notice period Contractor shall limit work to matters in
process as agreed with Buyer and will not initiate new work or projects, so that
the notice period serves to effect an orderly transition of Buyer's work in
process and Contractor's resources. However, Buyer may, at the time of
termination, elect to continue this Agreement or the terminated Statement of
Work solely for the purpose of completing any Statement of Work, or portion
thereof, in process at the time that notice of termination is given ("POST
TERMINATION PERFORMANCE"). Buyer will participate in any applicable acceptance
testing and be obligated to pay for such Post Termination Performance according
to this Agreement and the applicable Statement of Work.
(b) In connection with termination of this Agreement or any Statement
of Work, Buyer will pay in accordance with this Agreement and the applicable
Statement of Work for the work performed by Contractor to the date of cessation
of work, including any Post Termination Performance. If Post Termination
Performance results in completion of a Statement of Work, then Buyer shall pay
therefor according to the terms thereof and this Agreement. For any Services and
Deliverables remaining incomplete at the time of cessation of work, Buyer shall
pay Contractor as follows, subject to Buyer's rights under this Agreement. To
the extent that such Deliverables and Services were to be provided on a time and
materials basis, then Buyer shall pay Contractor for the hours worked and the
materials used in accordance with this Agreement to the date of cessation of
work pursuant to the termination notice. To the extent that such Deliverables
and Services were to be provided on a fixed price basis, then Buyer shall pay
Contractor project fees for the hours of work completed by Contractor in
accordance with the Agreement based upon Contractor's standard hourly rates for
the personnel who performed the work, but not to exceed in the aggregate for
each project (and for this purpose any change order will constitute a separate
project) an amount determined as the product of the fixed fee for that project
and a fraction, the numerator of which is the number of days (not greater than
the denominator) from the date of commencement of the Services being terminated
until the date of such termination, and the denominator of which is the
originally anticipated duration of that project.
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(c) Upon termination of this Agreement or any Statement of Work,
Contractor shall deliver to Buyer copies of all materials constituting its work
product and documentation of any incomplete Deliverables, and (c) Buyer shall
receive an irrevocable, fully transferable, royalty-free non-exclusive license
to make, use, sell, copy, distribute or make derivative works from such
incomplete Deliverables, "as is" and without warranty of any sort (other than
the warranties against infringement contained in this Agreement) provided that
all right, title and interest of Contractor in New Developments incorporated in
the incomplete Deliverables, have been or as of the termination date, will be
assigned to Buyer pursuant to Section 4.3.
(d) In the event of any termination of this Agreement or any Statement
of Work, Contractor will return to Buyer all materials provided by Buyer and
transfer and deliver to Buyer all work product and work in process of any kind
produced by Contractor in connection with this Agreement or the Statement of
Work and comply with the portions of this Agreement that survive termination as
described in Section 8.9(a).
8 GENERAL PROVISIONS
8.1 APPLICABLE LAW, INTERPRETATION.
This Agreement shall be governed by and construed in accordance with
the laws of the State of California and applicable federal law in effect on the
date of this Agreement. The captions and headings used in this document are for
convenience of reading only and are not to be used in the interpretation or
construction of this Agreement. This Agreement is not subject to (i) Article 2
of the Uniform Commercial Code, (ii) the Uniform Computer Information
Transactions Act, or (iii) the United Nations Convention on Contracts for the
International Sale of Goods.
8.2 COMPLIANCE WITH LAWS.
Both parties will comply with all applicable laws, regulations and
treaties, including (without limitation) including all such laws and regulations
pertaining to imports and exports (such as the U.S. Export Administration Act).
Without limiting the foregoing, Contractor will take reasonable steps to comply
with all applicable legal and regulatory requirements in effect from time to
time related to security, data protection, data processing and confidentiality.
Upon request, Contractor will demonstrate to Buyer its compliance with these
requirements.
8.3 SEVERABILITY.
In the event that any portion of this Agreement shall be deemed
unenforceable, the remainder of the Agreement shall remain in full force and
effect, unless elimination of the unenforceable portion would result in any
material failure of the remainder of the Agreement to reflect the intent of the
parties.
8.4 ASSIGNMENT.
This Agreement may not be assigned by a party without the written
consent of the other party, except that Buyer may assign this Agreement and any
Statement of Work to any of its affiliates, or to any transferee in connection
with the sale of all or substantially all of its business or assets.
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8.5 DUTY TO ACT REASONABLY.
The parties shall deal with one another in good faith. Whenever this
agreement requires or contemplates any action, decision, consent or approval,
the parties shall act reasonably and in good faith and (unless the parties have
expressly agreed in writing to some other discretionary standard) may not
unreasonably withhold or delay any such action, decision, consent or approval.
8.6 DISPUTES.
(a) In the event of any dispute concerning the interpretation, breach
or threatened breach of this Agreement, the parties shall each designate an
executive, who shall then meet and confer, in confidence, to attempt in good
faith to resolve all outstanding differences between the parties (and none of
the proposals, counter-proposals or statements made during their negotiations
shall be admissible for any purpose in any later proceeding). These discussions
will be treated as confidential settlement discussions.
(b) If negotiated resolution has not been reached within 14 days of
commencement of such conversations, then either party may require the other to
participate in nonbinding commercial mediation proceedings before a neutral
mediator acceptable to each party. Each party will participate in such mediation
in good faith in an effort to resolve their differences. The mediation will be
treated as a confidential settlement discussion. The mediator will not testify
for either party in any later proceeding related to the dispute. No recording or
transcript will be kept of the mediation proceedings. Each party will bear its
own expenses incurred in mediation. The fees and expenses of the mediator will
be shared equally by the parties.
(c) If the parties are unable to resolve the dispute within 30 days of
commencement of mediation (or within 30 days of commencement of discussions
under Section 8.6(a) if no mediation is commenced), then (except as otherwise
provided below) all disputes that arise from or relate to this agreement,
including without limitation any issue regarding the extent to which any dispute
is subject to arbitration and the applicability or enforceability of these
dispute resolution procedures, shall be decided by binding arbitration in Orange
County, California under the Commercial Arbitration Procedures of the American
Arbitration Association, before a sole arbitrator, who shall be an attorney or a
retired judge with at least fifteen (15) years of legal experience with
transactions similar to those contemplated by this Agreement. During the twenty
(20) days following the commencement of an arbitration, the parties will consult
to define and limit the issues and will exchange those documents or other
evidence each intends to use at the arbitration to support its case, and provide
each other with names of all proposed witnesses. Each party shall be entitled to
select and take the deposition of no more than three (3) persons in connection
with the arbitration. Each party shall cooperate fully in facilitating
discovery. Evidence in the arbitration will be limited to statements of counsel,
documents disclosed during the 20-day period mentioned above, written
submissions of witnesses identified during such period, and live testimony of
not more than three (3) witnesses for each side. The arbitrator's decision shall
be final, and may be confirmed by the judgment of a court of competent
jurisdiction. However, any dispute concerning Confidential Information or
intellectual property may, at either party's election, be decided by a court of
competent jurisdiction in Orange County, California, as provided below, and upon
commencement of any such proceeding, any arbitration then pending shall be
stayed, insofar as it concerns Confidential Information or intellectual
property. The arbitrator shall have no power or authority to award exemplary or
punitive damages, or non-monetary or equitable relief of any sort. Each party
reserves the rights to (i) seek provisional remedies from a court of competent
jurisdiction and (ii) to litigate disputes concerning Confidential Information
or intellectual property in courts of competent jurisdiction, as provided below.
All aspects of the arbitration and any award shall be confidential. Neither the
parties nor the arbitrator may disclose the existence, content or results of the
arbitration, except as necessary to comply with legal or regulatory
requirements. Before making any such disclosure, a party will give written
notice to all other parties and shall afford such parties a reasonable
opportunity to protect their interests.
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(d) All proceedings concerning (i) provisional remedies, (ii) the
interpretation, performance, breach or threatened breach of the parties'
contractual and legal obligations concerning intellectual property and
Confidential Information and (iii) confirmation of any arbitral award shall be
litigated and decided exclusively in California or federal courts in Orange
County, California. This choice of venue is intended by the parties to be
mandatory and not permissive, thereby precluding the possibility of litigation
between the parties with respect to or arising out of this Agreement or any
Statement of Work in any other jurisdiction or venue. Each party hereby waives
any right it may have to assert the doctrine of FORUM NON CONVIENS or any
similar doctrine or to object to venue with respect to any proceeding brought in
accordance with this paragraph, and stipulates that the California and federal
courts located in Orange County, California shall have IN PERSONAM jurisdiction
over each of them (and their respective indemnitees) for the purpose of
litigating any such dispute, controversy or proceeding. Each party hereby
authorizes and accepts service of process sufficient for personal jurisdiction
in any action against it as contemplated by this action by registered or
certified mail, return receipt requested, postage prepaid, to its address for
the giving of notices as set forth in this Agreement. Nothing herein shall
affect the right of any party to serve process in any other manner permitted by
law.
(e) In the event of any breach or threatened breach of Section 5.4, or
the provisions of this Agreement concerning Confidential Information and
intellectual property, the parties acknowledge that monetary damages may be an
inadequate remedy and the innocent party may suffer irreparable harm.
Accordingly, those provisions may be enforced, without following the alternative
dispute resolution procedures set forth herein, by appropriate equitable relief
pursuant to Section 8.6(d), upon a showing that the moving party has no adequate
legal remedy, is likely to suffer irreparable harm, and satisfies other
applicable requirements for equitable relief.
(f) During the pendency of any arbitral or court proceeding, each party
shall bear its own attorneys' fees and costs, and the parties shall each pay
half the arbitration costs. The prevailing party in any arbitration or court
proceeding under this Agreement will be entitled to recover its fees and costs
incurred in the arbitration or proceeding (including attorneys and arbitration
fees and costs) from the non-prevailing party, provided that the arbitrator or
judge has the discretion to determine that there is no prevailing party or to
eliminate or reduce the prevailing party's recovery of its fees and costs to the
extent that the arbitrator or judge determines that full recovery thereof would
be unreasonable or disproportionate to the harm suffered by the prevailing
party.
8.7 NOTICES.
Any notice required or permitted under this Agreement shall be
effective on delivery or five (5) days after mailing if given by certified mail,
return receipt requested, postage prepaid, and addressed to the respective party
at the addresses below or such other address as the party may designate to the
other party by notice complying with this provision.
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Notice to Contractor:
Web Tools International, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Notice to Buyer:
AccuPoll, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Telephone (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile (▇▇▇) ▇▇▇-▇▇▇▇
8.8 NO THIRD PARTY BENEFICIARY.
Nothing in this Agreement is intended to confer on rights, benefits,
remedies, obligations or liabilities on any person (including, without
limitation, any employees of the parties) other than the parties or their
respective successors or permitted assigns.
8.9 SURVIVAL, LIMITATIONS.
(a) Notwithstanding the expiration or termination of this Agreement,
those rights and obligations which are stated to survive pursuant this Agreement
or which by their nature are intended to survive such expiration or termination
shall so survive, including (without limitation) Sections 3.2, 4, 6, and 8.
(b) Except as otherwise expressly provided below, neither party may
bring any action or commence any arbitration arising from or relating to this
Agreement more than one year after the claim arose, was discovered (or should
have been discovered with reasonable diligence), whichever is later. Contractor
may not bring an action for nonpayment more than one year after the date the
last payment was due.
(c) Section (b) shall not apply to claims concerning intellectual
property and Confidential Information, which shall be subject to limitation
periods provided by law.
8.10 WAIVER OF BREACH.
The waiver of a breach of this Agreement or the failure of a party to
exercise any right under this Agreement shall in no event constitute a waiver as
to any other breach, whether similar or dissimilar in nature, or prevent the
exercise of any right under this Agreement.
8.11 ENTIRE AGREEMENT.
(a) This Agreement, together with all Statement(s) of Work, schedules,
and exhibits constitutes the entire agreement of the parties with respect to its
subject matter, supersedes any and all prior proposals, agreements and
understandings of the parties, whether written or oral (provided that this
provision shall not exclude liability for fraudulent representation), and may
not be amended except by a writing signed by the party against whom such
amendment is charged. Neither party is relying upon any representations or
inducements not specifically set forth in this Agreement.
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(b) All Statement(s) of Work, schedules, and exhibits are incorporated
in this Agreement. All such contract documents shall be construed consistently,
to the extent reasonably possible, but if any inconsistency may appear THEN (A)
the Agreement shall override conflicting terms and conditions of the other
documents, BUT (B) other documents, executed after the effective date of the
Agreement, shall supersede conflicting terms of this Agreement, to the extent
that they describe particular Services, payment terms, service commitments or
other obligations for particular Deliverable(s), phase(s) or aspect(s) of the
Services performed by Contractor.
8.12 SIGNATURES; COUNTERPARTS.
Facsimile and electronic signatures on this Agreement and Statements of
Work will have the same effect as originals, and this agreement and Statements
of Work may be executed in duplicates and counterparts, each of which shall be
effective as an original for all purposes.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
Effective Date set forth above.
WEB TOOLS INTERNATIONAL, INC.
By:
-------------------------------
Name:
------------------------------
Title:
------------------------------
ACCUPOLL, INC.
By:
-------------------------------
Name:
------------------------------
Title:
------------------------------
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EXHIBIT A TO
MASTER SERVICES AGREEMENT
BASIC RATES
Basic rates in U.S. dollars.
System Engineer $100 per hour
System Analyst $100 per hour
Senior System Engineer $140 per hour
Senior System Analyst $140 per hour
Technical Architect $160 per hour
Senior Technical Architect $180 per hour
Project Manager $160 per hour
Senior Project Manager $180 per hour
Technical Writer $80 per hour
Graphic Artist $50 per hour
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