Development Phase Agreement

DEVELOPMENT PHASE AGREEMENT

This Development Phase Agreement (the "Agreement") is entered into as of Effective Date: by and between Developer Name: , with principal address (the "Developer"), and Client Name: , with principal address (the "Client"). Developer and Client are each a "Party" and collectively the "Parties."

RECITALS

WHEREAS, Client desires to engage Developer to perform a defined phase of design, development and testing services for the project described as Project Name: (the "Project");

WHEREAS, Developer has the skill, personnel, and capacity to perform the services set forth in this Agreement and to deliver the deliverables described herein; and

WHEREAS, the Parties desire to set forth the terms and conditions under which Developer will perform the development phase work and Client will accept and pay for such work.

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

1. DEFINITIONS

1.1 "Deliverables" means the tangible and intangible items described in Section 2 that Developer is required to deliver to Client. "Acceptance Criteria" means the standards and testing procedures set forth in Section 3. All capitalized terms not otherwise defined in this Agreement shall have the meanings ascribed to them in the Agreement contextually.

2. SCOPE OF WORK

2.1 Services. Developer shall perform the development services described in the Phase Description below (the "Services") in accordance with the schedule and milestones set forth in Section 5.

3. DELIVERABLES AND ACCEPTANCE

3.1 Deliverables. Developer shall deliver the deliverables described in the Deliverables Summary below (each a "Deliverable"). Delivery shall be accompanied by documentation reasonably necessary for Client to test and use the Deliverable.

3.2 Acceptance. Client shall have Acceptance Period: after delivery to inspect and test each Deliverable. If Client notifies Developer in writing of material nonconformities within the Acceptance Period, Developer shall, at its expense, correct such nonconformities in accordance with a schedule reasonably acceptable to the Parties. Failure to notify Developer within the Acceptance Period constitutes acceptance of the Deliverable.

4. COMPENSATION; PAYMENT TERMS

4.1 Fees. Client shall pay Developer a fixed fee for the Phase in the total amount of USD, subject to adjustments for approved Change Orders.

4.2 Invoicing and Payment. Developer shall invoice Client according to the milestone schedule in Section 5. Unless otherwise agreed in writing, Client shall pay each undisputed invoice within days of receipt. Late payments shall accrue interest at the lesser of 1.5% per month or the maximum rate permitted by applicable law.

5. SCHEDULE AND MILESTONES

5.1 Time is of the essence with respect to the Milestones. Developer shall use commercially reasonable efforts to meet the schedule set forth above. Any extension requested by Developer that is not approved in writing by Client shall not relieve Developer of its obligations hereunder.

6. CHANGE ORDERS

6.1 Any material change to the Scope of Work shall be documented in a written change order executed by authorized representatives of both Parties ("Change Order"). A Change Order shall describe the change, its effect on the schedule, and any agreed adjustment to fees. Developer shall not be required to perform work outside the Scope of Work absent a fully executed Change Order.

7. INTELLECTUAL PROPERTY

7.1 Ownership. Unless otherwise agreed in a written statement signed by both Parties, Developer hereby assigns to Client all right, title and interest in and to the Deliverables that are specially commissioned for Client and paid in full hereunder. Developer retains ownership of Developer's preexisting materials, tools, libraries, and general know-how, subject to the licenses granted herein.

7.2 License to Developer Materials. To the extent Developer incorporates Developer Materials into the Deliverables, Developer grants Client a perpetual, worldwide, non-exclusive, royalty-free license to use, reproduce, modify and distribute such Developer Materials solely as part of the Deliverables.

8. CONFIDENTIALITY

8.1 Each Party shall hold in confidence and not disclose Confidential Information of the other Party except as reasonably necessary to perform obligations under this Agreement. Confidential Information excludes information that is publicly known, rightfully received from a third party, or independently developed without use of the disclosing Party's Confidential Information.

9. WARRANTIES; DISCLAIMER

9.1 Developer warrants that the Services will be performed in a professional and workmanlike manner consistent with industry standards. For a period of following Acceptance, Developer shall remedy material defects attributable to Developer's workmanship at no additional cost to Client.

9.2 EXCEPT FOR THE EXPRESS WARRANTY SET FORTH ABOVE, THE DELIVERABLES AND SERVICES ARE PROVIDED "AS IS" AND DEVELOPER DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, TO THE MAXIMUM EXTENT PERMITTED BY LAW.

10. LIMITATION OF LIABILITY

10.1 EXCEPT FOR LIABILITY ARISING FROM WILLFUL MISCONDUCT OR A PARTY'S BREACH OF CONFIDENTIALITY OR INFRINGEMENT OF INTELLECTUAL PROPERTY RIGHTS, IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES. EACH PARTY'S AGGREGATE LIABILITY UNDER THIS AGREEMENT SHALL NOT EXCEED THE TOTAL FEES PAID BY CLIENT TO DEVELOPER UNDER THIS AGREEMENT.

11. TERMINATION

11.1 Either Party may terminate this Agreement for material breach by the other Party if the breaching Party fails to cure such breach within days after written notice. Upon termination for Client's convenience, Client shall pay Developer for Services performed and reasonable wind-down costs incurred prior to termination.

12. TRANSITION ASSISTANCE

12.1 Upon expiration or termination, Developer shall reasonably cooperate with Client to effect an orderly transition of the Services and Deliverables. Transition assistance beyond thirty (30) days shall be subject to mutual agreement and appropriate compensation.

13. NOTICES

13.1 All notices under this Agreement shall be in writing and delivered to the addresses set forth below. Notices are effective upon personal delivery, certified mail (return receipt requested), or next business day by nationally recognized overnight courier.

14. GOVERNING LAW; DISPUTE RESOLUTION

14.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State/Province identified as Governing Jurisdiction: without regard to conflict of laws principles.

14.2 Dispute Resolution. The Parties shall first attempt in good faith to resolve disputes through negotiation. If unresolved within thirty (30) days, disputes shall be submitted to mediation before commencing litigation. Nothing herein prevents a Party from seeking injunctive relief when necessary to protect its rights.

15. ENTIRE AGREEMENT; SEVERABILITY

15.1 Entire Agreement. This Agreement, including all attachments and executed Change Orders, constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior oral or written agreements, proposals and representations.

15.2 Severability. If any provision of this Agreement is held invalid or unenforceable by a court of competent jurisdiction, the remainder of this Agreement shall remain in full force and effect, and the Parties shall endeavor in good faith to replace the invalid provision with a valid provision that achieves the Parties' original intent.

16. AMENDMENTS; WAIVER; COUNTERPARTS

16.1 Amendments. Any amendment or modification to this Agreement shall be in writing and signed by authorized representatives of both Parties.

16.2 Waiver. No failure or delay by either Party in exercising any right shall operate as a waiver of that right. A waiver must be in writing to be effective.

16.3 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument. Signatures delivered electronically or by electronic transmission shall be binding.

17. MISCELLANEOUS

17.1 Relationship of the Parties. The Parties are independent contractors. Nothing in this Agreement creates an employment, agency, joint venture, or partnership relationship between the Parties.

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