PRODUCT DEVELOPMENT AGREEMENT
In consideration of the mutual covenants made herein, the parties agree as follows:
1. Services. Enhance agrees to provide product design services as defined in the attached order form (the “Work”) at the request of the Client for fees agreed upon in advance and to deliver the Work by an agreed-upon due date and submission method. Enhance agrees that they will be the sole author of the Work, which will be original work by Enhance. In the case of certain engineering or prototyping projects, Enhance may utilize subcontracted firms for various components of the Work, the names of those firms shall be furnished to Client upon request. Enhance will cooperate with Client in editing and otherwise reviewing the Work prior to completion. Enhance agrees that all the services and work product provided hereunder shall be “Work for Hire”, unless it is specifically identified by Enhance as falling outside the scope of the Work before the Work is finally completed. Specifically, after Enhance has received full payment for all services related to the project, the Client shall own all rights to the Work improved by Enhance hereunder, including, but not limited to, inventions, designs, trademarks, copyrights, drawings and artwork.
2. Confidentiality. Enhance acknowledges that they may be furnished or may otherwise receive or have access to information which relates to the Client’s past, present or future products, creative works, marketing strategies, pending projects and proposals, and other proprietary information (the “Proprietary Information”). Enhance agrees to preserve and protect the confidentiality of the Proprietary Information and all physical forms thereof, disclosed pursuant to this Agreement to Enhance. In addition, Enhance shall not disclose or disseminate the Proprietary Information to any third party other than subcontractors bound by similar confidentiality terms and shall not use the Proprietary Information for the benefit of any third party. Unless otherwise requested in writing by Client, Enhance can use materials designed for Client and final products developed in the Work, on Enhance’s website to illustrate Enhance’s ability for portfolio purposes.
3. Compensation. Client agrees to pay Enhance according to the payment terms defined in the order form. If the parameters of the Work changes, Enhance will inform Client and the parties can discuss and agree upon any additional charges. Enhance will invoice for one half of the total estimated cost for each phase before Enhance begins the Work as a down payment, and invoice the rest of acquired costs upon completion. Enhance is responsible for the payment of all federal, state and/or local taxes with respect to the services it performs for the client as an independent contractor. The Client will not treat Enhance, or any of its employees, as an employee for any purpose.
4. Payment and Collection. Unless otherwise specified in writing, invoices not paid within 30 days of the invoice date will accrue interest at 1.5% per month.
5. Client Approval. Client is responsible for written approval of Work ordered via submission of this contract before Enhance proceeds with project. Upon acceptance and final approval of the Work delivered to Client, Client accepts responsibility and liability for any further processes and instances in which the Work is used.
6. Changes to Work. Client agrees that any verbal or written changes made by Client to the scope of the Work following its initiation by Enhance are subject to additional charges. Should such changes negate any part of the Work already completed at the time of the changes, Client agrees to pay for the completed work and all services related to it, in addition to charges for the change itself.
7. Cancellation. Both parties understand that Client or Enhance may terminate the service at any time if, for any reason, the relationship is deemed unsatisfactory by either party. Upon written cancellation, Client is responsible for payment for all expenses incurred and any work performed toward the completion of the Work or project based on the percentage of the Work or project completed. Should Client cancel the project following its completion, Client is responsible for full payment as per the attached order form. Reference is made to Section 16 of this Agreement for further cancellation provisions.
8. Completion Date. Enhance shall use reasonable efforts to complete the project by the estimated completion date agreed upon by Enhance and Client at the time Client retains Enhance to perform the services hereunder. However, in no event shall Client be entitled to recover from Enhance any damages (consequential or otherwise) caused by any delay in completion.
9. Force Majeure. Neither party shall be responsible for any delay or failure in delivery or performance of any of its duties hereunder due to acts of God, acts or omissions or any other occurrence commonly known as force majeure, including war, riots, acts of terrorism, embargoes, strikes, or other concerted acts of workers, casualties or accidents, or any other causes or circumstances that prevent or hinder the manufacture or delivery of the Parts. Such party may cancel or delay performance hereunder for so long as such performance is delayed by such occurrence and in such event the party shall have no liability to the other party.
10. Choice of Law/Binding Arbitration. This Agreement and any sales hereunder shall be governed by the internal laws of the State of Minnesota. Any dispute which cannot be resolved by mutual agreement of the parties shall be settled by arbitration in accordance with the commercial rules then in effect of the American Arbitration Association. The place of arbitration shall be Minneapolis, Minnesota. All arbitrators shall be knowledgeable in matters related to the type of supplies and services provided hereunder. The arbitration decision and award shall be binding on the parties and judgment thereon may be entered in any court of competent jurisdiction.
11. Indemnification. Client agrees to indemnify Enhance, its employees, agents, representatives and suppliers from and against any and all liability, claims, damages and other expenses (including attorneys’ fees, court costs and litigation expenses) arising out of or relating to any claim or action, regardless of form, concerning any breach of this Agreement by Client, any acts or omissions by Client relating to Client’s performance under this Agreement, and any claim of third parties arising out of this Agreement or the sale of services hereunder. Client will also indemnify, defend and hold Enhance harmless from any claim that the product designed from the services hereunder violate any patent or proprietary rights of a third party. It is the Client’s responsibility to pursue patent, copyright or other proprietary rights protection.
12. Warranties. THESE PRODUCT DESIGN SERVICES ARE PROVIDED “AS IS” WITHOUT WARRANTY OF ANY KIND, EITHER EXPRESS, IMPLIED, STATUTORY, OR OTHERWISE, INCLUDING BUT NOT LIMITED TO IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR NON-INFRINGEMENT. CLIENT ACKNOWLEDGES THAT ENHANCE HAS MADE NO CLAIM OR WARRANTY THAT ENHANCE WILL BE ABLE TO FIND A LICENSEE WILLING TO COMPENSATE CLIENT FOR HIS OR HER PRODUCT.
13. Limitation of Liability. ENHANCE DOES NOT ACCEPT LIABILITY BEYOND THE REMEDIES SET FORTH HEREIN, INCLUDING BUT NOT LIMITED TO ANY LIABILITY FOR LOST REVENUE OR PROFITS OR LOSS OF BUSINESS. EXCEPT AS EXPRESSLY PROVIDED HEREIN, ENHANCE WILL NOT BE LIABLE FOR ANY CONSEQUENTIAL, SPECIAL, INDIRECT, OR PUNITIVE DAMAGES, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, OR FOR ANY CLAIM BY ANY THIRD PARTY. CLIENT AGREES THAT FOR ANY LIABILITY RELATED TO THE PURCHASE OF PRODUCT DESIGN SERVICES, ENHANCE IS NOT LIABLE OR RESPONSIBLE FOR ANY AMOUNT OF DAMAGES ABOVE THE AMOUNT INVOICED FOR THE APPLICABLE SERVICES.
14. Subsequent Agreement. This Agreement sets forth the terms and conditions of the product design and development services that Enhance provides the Client as defined in the Work. A subsequent and separate agreement shall be executed at the completion of the Work if Client elects to have Enhance represent them for licensing (hereafter “License Representation Agreement”).
15. Notices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand, or other communication under the Agreement by either party to the other shall be sufficiently given or delivered if it is dispatched by registered or certified mail, postage prepaid, return receipt requested, or delivered personally; and
a. as in the case of Client, is addressed to or delivered personally to the Client at the address Client provides; or at any alternate address that has been provided to the other party in accordance with this “Notice” provision, and;
b. as in the case of Enhance, is addressed to or delivered personally to Trevor Lambert at 11180 Zealand Ave N, Minneapolis, MN 55316, or at any alternate address that has been provided to the other party in accordance with this “Notice” provision.
16. Statutory Disclosures. The following disclosures are required by law and are expressly made a part of this contract: You have the right to cancel this contract for any reason at any time within three business days from the date you and the invention developer sign the contract and you receive a fully executed copy of it. To exercise this option you need only mail or personally deliver to this invention developer written notice of your cancellation. The three business day period during which you may cancel this contract for any reason by mailing or delivering written notice to the invention developer will expire three business days prior to the Effective Date. If you choose to mail your notice, it must be placed in the United States mail addressed to Enhance Product Development, Inc. at 11180 Zealand Ave N, Minneapolis, MN 55316 with first class postage prepaid before midnight of this date. If you choose to personally deliver your notice to the invention developer, it must be delivered by the end of the developer’s normal business day on this date. Upon cancellation, the invention developer must return by mail or personal delivery, within ten business days after receipt of the cancellation notice, all money paid and all materials provided either by you or by another party in your behalf. An invention developer who is also a lawyer may give you legal advice concerning patent, copyright, or trademark law or to advise you of whether your idea or invention may be patentable or may be protected under the patent, copyright, or trademark laws of the United States or any other law. An invention developer who is not a lawyer may not give you legal advice on these subjects. No patent, copyright or trademark protection will be acquired for you by the invention developer. Your failure to inquire into the law governing patent, copyright or trademark matters may jeopardize your rights in your idea or invention, both in the United States and in foreign countries. Your failure to identify and investigate existing patents, trademarks or registered copyrights may place you in jeopardy of infringing the copyrights, patent or trademark rights of other persons if you proceed to make, use, distribute or sell your idea or invention.