Annual Service Contract

ANNUAL SERVICE CONTRACT

This Annual Service Contract ("Contract") is made and entered into as of , by and between Service Provider Name: (Service Provider) and Client Name: (Client).

RECITALS

WHEREAS, Service Provider is engaged in the business of providing the services described in Section 1 and possesses the skill, personnel and resources necessary to perform such services; and

WHEREAS, Client desires to retain Service Provider to provide annual services pursuant to the terms and conditions set forth in this Contract and Service Provider agrees to provide such services on the terms herein;

WHEREAS, the parties intend by this Contract to set forth the full agreement regarding scope, payment, performance standards and remedies for breach.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, the parties agree as follows:

1. SERVICES

1.1 Scope of Services. Service Provider shall perform the services described below (the "Services") in a professional and workmanlike manner in accordance with industry standards. The Services shall include the annual tasks, inspections, maintenance and deliverables described in the scope field and any written change orders executed under Section 4.

2. TERM

2.1 Term. The term of this Contract shall commence on , and shall continue for a period of one (1) year unless earlier terminated in accordance with Section 12. The Contract shall automatically renew for successive one-year terms unless either party delivers written notice of non-renewal at least days prior to the end of the then-current term.

3. FEES; PAYMENT

3.1 Fees. Client shall pay Service Provider an annual fee in the amount set forth below for the Services. Fees shall be payable in accordance with the payment schedule set forth in Section 3.2.

3.2 Late Payment. Any undisputed amount not paid when due shall accrue interest at the lesser of 1.5% per month or the maximum rate permitted by law, and Client shall pay all reasonable costs of collection, including attorneys' fees.

4. CHANGE ORDERS

4.1 Any change in the scope of Services shall be documented in a written change order signed by both parties that specifies the change, schedules, and any adjustments to fees. No change shall be binding unless reduced to writing and signed by authorized representatives of both parties.

5. PERFORMANCE STANDARDS

5.1 Standard of Performance. Service Provider shall perform the Services using qualified personnel and in accordance with applicable laws, codes, and accepted industry standards. Service Provider shall promptly correct any nonconforming services at its expense where such nonconformity is reported within thirty (30) days of discovery.

6. CONFIDENTIALITY

6.1 Confidential Information. Each party shall hold in confidence all non-public information disclosed by the other party that is designated as confidential or that reasonably should be understood to be confidential given the nature of the information. Confidential information shall not include information that is public, already known to the receiving party, or rightfully received from a third party without restriction.

6.2 Use and Disclosure. The receiving party shall use Confidential Information only to perform its obligations under this Contract and shall not disclose Confidential Information to any third party except to employees, contractors or agents who need to know and are bound by confidentiality obligations at least as protective as those herein.

7. INTELLECTUAL PROPERTY

7.1 Ownership. Unless otherwise agreed in a written statement of work, Service Provider retains ownership of all preexisting intellectual property and tools. Work product created specifically for Client under this Contract shall be owned by Client upon full payment, except where Service Provider has incorporated its preexisting proprietary materials, which shall remain the sole property of Service Provider.

8. INSURANCE

8.1 Insurance Requirements. During the term of this Contract, Service Provider shall maintain at its expense commercial general liability insurance with limits not less than the amounts indicated and, where applicable, workers' compensation and professional liability insurance covering its employees and agents.

9. INDEMNIFICATION

9.1 Indemnity by Service Provider. Service Provider shall indemnify, defend and hold harmless Client and its officers, directors and employees from and against any third-party claims, liabilities, losses or expenses (including reasonable attorneys' fees) arising out of Service Provider's gross negligence, willful misconduct or breach of this Contract, except to the extent caused by Client's negligence or breach.

9.2 Indemnity by Client. Client shall indemnify, defend and hold harmless Service Provider for claims arising from Client-supplied materials, instructions, or Client's negligence.

10. LIMITATION OF LIABILITY

10.1 Except for liability arising from gross negligence, willful misconduct, or a breach of confidentiality or indemnity obligations, neither party shall be liable for consequential, incidental, special or punitive damages. The aggregate liability of each party for direct damages under this Contract shall not exceed the total fees paid by Client to Service Provider under this Contract during the twelve (12) months immediately preceding the event giving rise to liability.

11. TERMINATION

11.1 Termination for Cause. Either party may terminate this Contract for material breach if the breaching party fails to cure such breach within thirty (30) days after written notice specifying the nature of the breach.

11.2 Termination for Convenience. Either party may terminate this Contract for convenience upon sixty (60) days' prior written notice to the other party. Upon termination, Client shall pay Service Provider for Services performed and reimbursable expenses incurred through the effective date of termination.

12. NOTICES

12.1 Method. All notices required or permitted hereunder shall be in writing and shall be delivered by hand, certified mail (return receipt requested), or commercially recognized overnight courier, addressed to the parties at the addresses set forth below or to such other address as either party may designate in writing.

13. AMENDMENT; WAIVER; COUNTERPARTS

13.1 Amendment. This Contract may be amended only by a written instrument signed by authorized representatives of both parties.

13.2 Waiver. Failure or delay by either party to exercise any right shall not constitute a waiver of that right. A waiver must be in writing to be effective.

13.3 Counterparts. This Contract may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Signatures transmitted by electronic or facsimile means shall be deemed binding.

14. GOVERNING LAW; ENTIRE AGREEMENT; SEVERABILITY

14.1 Governing Law. This Contract shall be governed by and construed in accordance with the laws of the state specified below without regard to its conflict of law principles.

14.2 Entire Agreement. This Contract, including any exhibits and written change orders executed pursuant hereto, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, proposals and communications, whether oral or written.

14.3 Severability. If any provision of this Contract is held to be invalid or unenforceable, the remaining provisions shall remain in full force and effect and the invalid provision shall be reformed only to the extent necessary to make it enforceable.

15. MISCELLANEOUS

15.1 Relationship of Parties. The parties are independent contractors. Nothing in this Contract creates a partnership, joint venture, employment or agency relationship between the parties.

15.2 Subcontracting. Service Provider may subcontract portions of the Services provided that Service Provider remains responsible for the performance of such subcontractors under this Contract.

AUTHORITY TO EXECUTE

EACH INDIVIDUAL SIGNING BELOW REPRESENTS AND WARRANTS THAT HE OR SHE HAS BEEN DULY AUTHORIZED TO EXECUTE THIS CONTRACT ON BEHALF OF THE PARTY FOR WHICH THEY SIGN.

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