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Software Development and Acquisition Agreement by esr15791

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									                               Software development and acquisition agreement.

   This SOFTWARE DEVELOPMENT AGREEMENT is made and entered into effective as of [date] by and
between XXXXX, a [state] corporation having a place of business at [address] ("XXXXX"), and , a [state]
corporation having a place of business at [address], ("Developer").

                                                       RECITALS

   1. Developer is engaged in the business of designing and developing computer software. XXXXX is engaged in the
business of developing, licensing and distributing software throughout the world.

    2. XXXXX desires to engage Developer to perform certain software development services and Developer is willing
to perform software development services for XXXXX upon the terms and conditions set forth herein.

   NOW, THEREFORE, the parties hereby agree as follows:

      1. Software Development Services.

         (a). Developer agrees to design and develop the software product(s) described in the attached Exhibit A (the
      "Product(s)") in two phases consisting of the creation of written Product specifications (the "Specifications")
      and the development of the Product, pursuant to the schedule set forth in the attached Exhibit B. The term
      "Product" includes both the source code and object code for the software.

          (b). XXXXX will have the period set forth in Exhibit B to review the Specifications. XXXXX will report
      any deficiencies in the Specifications to Developer and Developer will correct the deficiencies within the period
      set forth in Exhibit B. XXXXX's acceptance or non-acceptance of the Specifications will be based on XXXXX's
      determination of whether the Specifications represent an acceptable implementation of the functional
      requirements set forth in Exhibit A (the "Functional Requirements"). If XXXXX accepts the Specifications,
      Developer will develop the Product in accordance with the Specifications and Functional Requirements.

         (c). Either party may, from time to time during the performance of the development of a particular Product,
      provide written notice to the other party proposing changes to the applicable Specification or the schedule
      ("Change Proposal"). Following a Change Proposal, the parties shall promptly meet to determine the financial
      and schedule impact, if any, and whether, and with what modifications the proposed change is mutually
      agreeable. No Change Proposal will have any contractually binding effect until formally agreed to in writing by
      both parties; provided, however, that if XXXXX initiates a Change Proposal, and agrees to pay Developer's
      additional fees to make such change, Developer may not refuse to accept any reasonably requested Change
      Proposal.

         (d). The services to be performed under this Agreement shall be performed at Developer's offices, unless the
      parties mutually agree that such services may be performed at another site. Developer shall not subcontract or
      permit third parties to perform the services to be rendered under this Agreement without XXXXX's prior written
      consent.

          (e). Developer shall provide, pay for, and keep in good standing all licenses pertaining to activities engaged
      in by Developer and shall comply with all federal, state and local laws and regulations pertaining to such
      activities.

      2. Delivery and Acceptance Testing.




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    (a). Developer shall deliver the Specifications, Product and Documentation to XXXXX in accordance with
the schedule set forth in Exhibit B. The term "Documentation" means all technical documentation for the
Product, including flowcharts, source code, object code, program procedures and descriptions (including
descriptions of the source code and build procedures for the object code), procedures for maintenance and
modification, testing data and similar written material relating to the design, structure and implementation of the
Product. The term "Documentation" does not include end user documentation or manuals. The Documentation
shall be sufficient to enable a reasonably skilled and experienced programmer to understand the design,
structure and implementation of the Product.

    (b). Developer shall perform bench testing and employ sufficient quality assurance standards to assure that
the final release of the Product conforms to the Specifications and shall adequately test the final release of the
Product prior to delivery to XXXXX. XXXXX will test the final release of the Product to verify whether the
Product conforms to the Functional Requirements and the Specifications.

    (c). If the final release of the Specifications, Product or Documentation fail to meet any of the requirements
in this Agreement, XXXXX shall notify Developer in writing, and Developer shall have an additional
calendar days (the "Correction Period") in which to correct or modify the Specifications, Product and
Documentation to meet the requirements, and to resubmit the Specifications, Product and Documentation to
XXXXX for testing. If the Specifications, Product or Documentation fail to meet the requirements at the end of
the Correction Period, then at XXXXX's option, (1) the Correction Period may be extended as may be agreed by
the parties, (2) XXXXX may terminate this Agreement, return the Specifications, Product and Documentation
to Developer, and Developer will refund to XXXXX any consideration previously given to Developer for
development pursuant to this Agreement or (3) XXXXX may supply, correct or complete the deliverable item
and either deduct an amount equal to one and one-half (11/2) times XXXXX's fully-burdened costs (including
without limitation direct internal labor and fringe benefits and any sums, including royalties, paid to third
parties) from any payments due to Developer or receive a refund from Developer for such costs up to the total
amount paid by XXXXX hereunder.

3. Payment and Taxes.

    (a). In consideration of Developer's obligations under this Agreement, XXXXX will pay Developer a
development fee of        in accordance with the schedule set forth in Exhibit B. All fees payable hereunder are
for the development of custom software to the special order of XXXXX.

   (b). Developer agrees to pay, and to indemnify and hold XXXXX harmless from, any sales, use, excise,
import or export, value added or similar tax or duty not based on XXXXX's net income, as well as the collection
or withholding thereof, including penalties and interest, and all government permit or license fees and all
customs and similar fees levied upon the delivery of the Product, Documentation, and Specifications, and any
costs associated with the collection of any of the foregoing items.

   (c). All out-of-pocket expenses incurred by Developer shall be paid by Developer.

4. Warranty.

    (a). Developer warrants that the Specifications will represent an acceptable implementation of the
Functional Requirements. Developer warrants that for a period of twelve (12) months after XXXXX's first
commercial shipment of the Product excluding shipments for beta testing, (the "Warranty Period"), the Product
will perform in accordance with the Specifications. During the Warranty Period, Developer shall correct any
failure of the Product to perform in accordance with the Specifications, as soon as possible, but in no event less
than fifteen (15) calendar days after notice from XXXXX of any failure to perform in accordance with the


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Specifications. Furthermore, without additional charge Developer will (i) assist with the installation of the
Product, new versions, updates, and corrections; (ii) assist XXXXX with the identification and resolution of
problems with the Product, new versions, updates, and corrections; and (iii) develop, to the extent necessary,
temporary fixes and work arounds for emergency difficulties. Developer will supply XXXXX with source code
and object code for all bug fixes and error corrections and all revised Documentation required for the Product to
conform to the Specifications and to meet the Functional Requirements. In addition to the foregoing, at
XXXXX's request, Developer will make qualified technical personnel available for a minimum of              hours
at reasonable times for training and consultation with representatives of XXXXX.

   (b). At XXXXX's option, XXXXX may extend the period for which Developer must provide support
pursuant to Paragraph 4(a) by additional twelve (12) month periods by paying an extended maintenance fee of
       within thirty (30) days of notice to Developer that XXXXX wants extended maintenance.

5. Indemnity.

    (a). Developer represents and warrants that the Specifications, Product and Documentation will be original
creations of Developer and will not infringe any patent, copyright, trade secret or other proprietary rights of any
third party; that Developer has not previously or otherwise granted any rights to any third party which conflict
with the rights herein granted by Developer; and that Developer has the full power and ability to enter into this
Agreement, to carry out its obligations set forth herein and to grant the rights granted to XXXXX herein.

    (b). Developer will indemnify XXXXX and its customers for, and hold them harmless from, any loss,
expense, damages, claims, demands, or liability arising from any claim, suit or recovery resulting from a breach
of any warranty set forth in Paragraph 5(a) above provided Developer is given the right to participate in the
investigation, preparation, defense and settlement of such claim or suit. XXXXX will promptly notify
Developer in writing of any such claim or suit, and will fully cooperate in the defense thereof. XXXXX shall
have the right, at its option, to participate in the defense of any such claim with counsel of its choice.

    (c). Following notice of a claim or suit, Developer shall, at Developer's expense, either procure for XXXXX
the right to continue to use the Specifications, Product and Documentation as furnished, or replace or modify
Specifications, the Product and Documentation to make them non-infringing. If Developer elects to replace or
modify the Specifications, Product or Documentation such replacement shall be subject to acceptance testing
pursuant to the terms of this Agreement.

   (d). Developer will indemnify XXXXX and its customers for, and hold them harmless from, any loss,
expense, damages, claims, demands, or liability arising from any claim, suit or recovery resulting from (i) the
negligence or willful misconduct of Developer; or (ii) Developer's noncompliance with applicable federal, state
and local laws and regulations pursuant to Paragraph 1(e).

6. Ownership of Work Product.

    (a). In consideration of XXXXX's payment of the fees specified herein, Developer hereby assigns to
XXXXX its entire right, title and interest in the Product, Documentation, Specifications, notes, drawings,
designs, procedures, discoveries and inventions created pursuant to this Agreement, including, but not limited
to, patents, copyrights, trade secrets and any other intellectual property right, whether in the United States or
abroad. Developer agrees to cooperate with XXXXX in the procurement and maintenance of XXXXX's rights
in the Product, Documentation and Specifications and to sign all papers which XXXXX may deem necessary
and desirable for vesting XXXXX with such rights throughout the world, including litigation of applicable
patents, copyrights and other proceedings, and executing an assignment of copyright in the form attached hereto
as Exhibit C. In the event that XXXXX is unable for any reason whatsoever to secure a signature on behalf of


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Developer to any document it believes is reasonably required in order to apply for or execute any patent,
copyright or other application with respect to the Product, Specifications or Documentation Developer hereby
irrevocably designates and appoints XXXXX and its duly authorized officers and agents as Developer's agents
and its attorneys-in-fact to act for and in its behalf and instead of it, to execute and file any such application and
to do all other lawfully permitted acts to further the prosecution and issuance of patents, copyrights or other
rights therein with the same legal force and effect as if executed by Developer.

    (b). Developer hereby irrevocably transfers and assigns to XXXXX any and all Moral Rights (as defined
below) Developer may have in or with respect to the Product, the Documentation or the Specifications
(collectively, the "Works"). To the extent Developer cannot assign such rights, Developer hereby waives and
agrees never to assert such rights against XXXXX or any of XXXXX's licensees. If Developer has any right to
the Works that cannot be assigned to XXXXX or waived by Developer, Developer unconditionally and
irrevocably grants to XXXXX, during the term of such rights, an exclusive, irrevocable, perpetual, worldwide,
fully paid and royalty-free license, with rights to sublicense throughout multiple levels of sublicensees, to
reproduce, create derivative works of, distribute, publicly perform and publicly display by all means now known
or later developed such rights. In addition, Developer agrees to obtain such assignment, waiver, covenant not to
assert such rights, or license from any subsidiary, subcontractor, or employee who creates, either in whole or
part, the Works. "Moral Rights" means any right to (i) divulge the Works to the public; (ii) retract the Works
from the public; (iii) claim authorship of the Works; (iv) object to any distortion, mutilation or other
modification of the Works; or (v) any and all similar rights, existing under judicial or statutory law of any
country or jurisdiction in the world, or under any treaty regardless of whether or not such right is called or
generally referred to as a moral right.

   (c). Any data or other materials furnished by XXXXX for use by Developer in connection with the services
performed hereunder shall remain the sole property of XXXXX and shall be used by Developer solely for the
purposes set forth herein.

     (d). Developer agrees that it will not create any product in direct competition with the Product during the
term of this Agreement and for a period of            years after acceptance of the Product by XXXXX. A product
is in "direct competition" if it is designed to perform the same scope of functions for the same target audience as
the Product.

7. Confidentiality.

    (a). "Confidential Information" as used in this Agreement shall mean the Functional Requirements,
Specifications, Product, Documentation, any and all technical and non-technical information including patent,
trade secret, and proprietary information, techniques, sketches, drawings, models, inventions, know-how,
processes, apparatus, equipment, algorithms, software programs, software source documents, and formulae
related to the current, future and proposed products and services of XXXXX, and includes, without limitation,
its respective information concerning research, experimental work, development, design details and
specifications, engineering, financial information, procurement requirements, purchasing, manufacturing,
customer lists, business forecasts, sales and merchandising, and marketing plans and information.

    (b). Developer agrees that it will not make use of, disseminate, or in any way disclose Confidential
Information to any person, firm or business, except to the extent necessary for performance of this Agreement.
Developer agrees that it shall disclose Confidential Information only to those of its employees who need to
know such information and who have previously agreed to be bound by the terms and conditions of this
Agreement. Developer agrees that it shall treat all XXXXX Confidential Information with the same degree of
care as it accords to its own confidential information and Developer represents that it exercises reasonable care
to protect its own confidential information.


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    (c). Except for the Confidential Information relating to the Specifications, Product and Documentation,
Developer's obligations with respect to any portion of Confidential Information shall terminate when Developer
can document that (a) it was in the public domain at the time it was communicated to Developer by XXXXX; (b)
it entered the public domain subsequent to the time it was communicated to Developer by XXXXX through no
fault of Developer; (c) it was in Developer's possession free of any obligation of confidence at the time it was
communicated to Developer by XXXXX; (d) it was rightfully in Developer's possession free of any obligation
of confidence at or subsequent to the time it was communicated to Developer by XXXXX; (e) it was developed
by employees or agents of Developer independently of and without reference to any information communicated
to Developer by XXXXX; or (f) the communication was in response to a valid order by a court or other
governmental body, was otherwise required by law, or was necessary to establish the rights of either party under
this Agreement.

   (d). This Paragraph 7 shall survive any termination of this Agreement.

8. Termination.

   (a). With Cause. XXXXX may terminate this Agreement upon thirty (30) days written notice of a material
breach of this Agreement if such breach is not cured within such thirty (30) day period.

    (b). Rights Upon Termination. Upon termination of this Agreement, Developer will deliver all
Specifications, Product, Documentation and other deliverables in its possession to XXXXX and XXXXX shall
have the right to supply, correct or complete the deliverable item and deduct an amount equal to one and
one-half (1-1/2) times XXXXX's fully burdened costs (including without limitation direct internal labor and
fringe benefits and any sums, including royalties, paid to third parties) from any payments due to Developer or
receive a refund from Developer for such costs up to the total amount paid by XXXXX hereunder.

9. General Provisions.

   (a). No Agency. Developer will in all matters relating to this Agreement act as an independent contractor.
Developer will have no authority and will not represent that it has any authority to assume or create any
obligation, express or implied, on behalf of XXXXX, or to represent XXXXX as agent, employee or in any
other capacity. Neither execution nor performance of this Agreement shall be construed to have established any
agency, joint venture or partnership.

    (b). Governing Law. This Agreement shall be governed in all respects by the laws of the United States of
America and [state] excluding the application of its conflict of laws rules. The parties agree that the United
Nations Convention on Contracts for the International Sale of Goods is specifically excluded from application
to this Agreement.

    (c). Notices. All notices or reports permitted or required under this Agreement shall be in writing and shall
be delivered by personal delivery, telegram, telex, telecopier, facsimile transmission or by certified or registered
mail, return receipt requested, and shall be deemed given upon personal delivery, five (5) days after deposit in
the mail, or upon acknowledgment of receipt of electronic transmission. Notices shall be sent to the signatory of
this Agreement at the address set forth at the end of this Agreement or such other address as either party may
specify in writing. If the notice is to XXXXX, a copy shall also be sent to its Corporate Counsel.

   (d). Injunctive Relief. It is understood and agreed that, notwithstanding any other provision of this
Agreement, breach of the provisions of this Agreement regarding the protection of Confidential Information by
Developer will cause XXXXX irreparable damage for which recovery of money damages would be inadequate,




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       and that XXXXX shall therefore be entitled to obtain timely injunctive relief to protect XXXXX's rights under
       this Agreement in addition to any and all remedies available at law.

          (e). Time of the Essence. The parties acknowledge that time is of the essence in the performance of their
       obligations under this Agreement.

           (f). Waiver. The failure of either party to require performance by the other party of any provision hereof shall
       not affect the full right to require such performance at any time thereafter; nor shall the waiver by either party of
       a breach of any provision hereof be taken or held to be a waiver of the provision itself.

          (g). Severability. In the event that any provision of this Agreement shall be unenforceable or invalid under
       any applicable law or be so held by applicable court decision, such unenforceability or invalidity shall not
       render this Agreement unenforceable or invalid as a whole, and, in such event, such provision shall be changed
       and interpreted so as to best accomplish the objectives of such unenforceable or invalid provision within the
       limits of applicable law or applicable court decisions.

          (h). Warranty. Developer warrants that it has full power to enter into and perform this Agreement, and the
       person signing this Agreement on Developer's behalf has been duly authorized and empowered to enter in this
       Agreement, understands it and agrees to be bound by it.

          (i). Headings. The section headings appearing in this Agreement are inserted only as a matter of convenience
       and in no way define, limit, construe or describe the scope or extent of such section, or in any way affect this
       Agreement.

          (j). Confidentiality of Agreement. Neither party will disclose any terms or the existence of this Agreement,
       except pursuant to a mutually agreeable press release or as otherwise required by law.

           (k). Entire Agreement. This Agreement and the Exhibits hereto constitute the entire agreement between the
       parties with respect to the subject matter hereof. This Agreement supersedes, and the terms of this Agreement
       govern, any prior or collateral agreements with respect to the subject matter hereof with the exception of any
       prior confidentiality agreements between the parties. This Agreement may only be changed by mutual
       agreement of authorized representatives of the parties in writing.

           (l). Assignment. Developer shall not assign any rights or obligations arising under this Agreement without
       the prior written consent of XXXXX. Subject to the above restriction on assignment, this Agreement shall inure
       to the benefit of and bind the successors and assigns of the parties.

          (m). Attorney's Fees. In any legal proceeding between the parties, the prevailing party shall be entitled to
       recover attorney's fees and expenses.

    IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed by their respective au-
thorized representatives. This Agreement may be executed in counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same original.




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XXXXX:                                                                                                  DEVELOPER:
______________________________                                                        ______________________________
Authorized Signature                                                                               Authorized Signature

Printed Name                                                                                                    Printed Name

Title                                                                                                                           Title

Date                                                                                                                            Date


                                                        Exhibit A.

                                          FUNCTIONAL REQUIREMENTS

                                                        Exhibit B.

                                            DEVELOPMENT SCHEDULE

   Milestone Description                     Schedule                                  Payment Due


                                                        Exhibit C.

                                           ASSIGNMENT OF COPYRIGHT

   For good and valuable consideration which has been received, the undersigned sells, assigns and transfers to
XXXXX, a [state] corporation, and its successors and assigns, the copyright and all of the right, title and interest of the
undersigned, vested and contingent, in and to the following work, which was created by the following indicated
author(s):

Title:

Author(s):

Copyright Office Identification No. (if any):


   Executed this         day of [date].

Signature:

Printed Name:




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