Master Services Agreement
Updated: August 14, 2019
THIS MASTER SERVICES AGREEMENT (the “Agreement”) is entered into as of the effective date of the “SOW” between WatServ Inc. (“WatServ”) and the above-name customer (“Customer” and, together with WatServ the “Parties” and, each a “Party”).
IN CONSIDERATION OF in consideration of the premises and the mutual covenants and conditions contained in this Agreement and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
1.1 Definitions. Throughout this Agreement, except as expressly provided in a Schedule, SOW or a Change Order, the following words, terms and expressions shall have the following meanings:
“Account” means the account created with WatServ in connection with the Agreement that relates to Customer’s purchase of, subscription to or use of the Services.
“Account Information” means any information required in connection with or associated to Customer’s Account, including administrative users, contact information, address, access information, Account number, login names, passwords, credit card and other financial information, security questions and their respective answers, Users, and any other similar information.
“Affiliate” means, with respect to a Party, a legal entity that is controlled by, controls, or is under common control with that Party. “Control” means ownership of more than 50% of the voting power or ownership interests of the entity or the right to direct or control the management of the entity.
“Applications” means the software licensed directly by Customer and hosted on WatServ’s servers.
“Business Day” means any day which is not a Saturday, a Sunday or a day observed as a statutory or civic holiday under the laws of the State of Delaware, on which the principal commercial banks in the State of Delaware are open for business.
“Confidential Information” means information of a Party, its Representatives or customers and is non-public, confidential or proprietary in nature, including, any and all technical and non-technical information, including Intellectual Property and proprietary information, techniques, sketches, drawings, models, inventions, know-how, processes, apparatus, design details, specifications, equipment, algorithms, software programs, software source documents and formulae related to the current, future and proposed products and services of such party, and including, information concerning research, experimental work, development, engineering, financial information, procurement requirements and processes, purchasing, manufacturing, customer lists and preferences, business ventures, forecasts and strategic plans, sales, merchandising and marketing strategies, plans and programs. Confidential Information includes without limitation (a) information transmitted in written, oral, magnetic or any other medium, (b) all copies and reproductions, in whole or in part, of such information, and (c) all summaries, analyses, compilations, studies, notes or other records which contain, reflect, or are generated from such information. Confidential Information does not include information that (i) has become part of the public domain through no act or omission of the receiving Party or its Representatives in contravention of this Agreement; (ii) was developed by the receiving Party or on its behalf independently of and without reference to any Confidential Information; or (iii) is or was lawfully and independently provided to the receiving Party from a third party who was not, to the knowledge of the receiving Party, subject to an obligation of confidentiality to the disclosing Party or otherwise prohibited from transmitting such information.
“Customer Data” means anything that Customer or Users upload or enter through the Services in any form including text, graphics (e.g., photographs, illustrations, images, and logos), programs, code, video recordings, audio recordings and personally identifiable information.
“Customer Regulatory Requirements” means Laws applicable to Customer’s business and operations reasonably related to Customer’s receipt of the Services.
“Customer Pre-existing Technology” means any Intellectual Property (a) owned by Customer prior to the SOW Effective Date and any enhancement, modification, alteration, change, variation, revision, adaptation, improvement, update, or upgrade thereto, or any derivative work thereof, or (b) which, subsequent to the SOW Effective Date, is developed or acquired by Customer outside the performance of the Services and without use of or reference to any of WatServ’s Confidential Information, and any enhancement, modification, alteration, change, variation, revision, adaptation, improvement, update or upgrade thereto or any derivative work thereof, and includes any Data.
“Data” means all data provided by Customer or placed on WatServ’s servers by or through Customer in connection with the Services, or that Customer uses, posts, places or otherwise transfers or transmits with respect to the Services, including text, sound, video or image file, material, product, content, IP and similar addresses, recording, message, software, personal data, Account Information, account-related setting and User Data.
“Intellectual Property” means intellectual property rights (including, patents, patent applications, trade secrets, trademarks, trade names, service marks, logos, moral rights, or any other copyrights inherent thereunder, along with any registrations and applications to register, as applicable) in tangible and intangible materials or information which may be continually under development, modification or improvement, including, but not limited to, software, source code, object code, routines, tools, documentation, methodologies, techniques, algorithms, inventions, ideas, databases, and know-how.
“Law” or “Laws” means all applicable laws (including those arising under common law), statutes, codes, orders, rules, regulations, reporting or licensing requirements, ordinances, and other pronouncements having the effect of law in the State of Delaware, any foreign country or other political subdivision where Services are performed.
“Personal Data” means Data about an identifiable individual, but does not include the name, title, business address or telephone number of an employee of an organization.
“Representative(s)” means Affiliates, employees, agents, and representatives, including attorneys, accountants, consultants, financial advisors, and third parties retained to perform the work required in connection with the Services provided.
“Services” has the meaning given to it in Section 2.2.
“Supplier” means any vendor, supplier or licensor of software, services or products Included in the Services, and any of its Affiliates.
“Supplier Services” means any software, services or products that are owned by a Supplier and that are provided, made available, displayed, run or accessed through the Services.
“SOW” means a Statement of Work which, when executed forms part of this Agreement.
“Termination Assistance” means the tasks, functions, and activities performed by WatServ to provide the orderly transfer of the Services from WatServ to Customer or to an alternative third party service WatServ designated by Customer, which may include, (a) the development of a written transition plan for the transition of the Services to Customer or Customer’s designee, which plan shall include capacity planning, facilities planning, telecommunications planning and other planning necessary to effect the transition; (b) performance of consulting services as requested to assist in implementing the transition plan; and (c) provision of other technical assistance as requested by Customer.
“User” means any person who accesses or uses the Services.
“User Data” means all data related to a User and provided to WatServ in connection with the Services, including text, sound, video or image files, material, content, IP and similar addresses, recording, message, software, Account Information and account-related settings, and personal data.
“WatServ Pre-existing Technology” means WatServ Tools and any other Intellectual Property (a) owned by WatServ prior to the SOW Effective Date and any enhancement, modification, alteration, change, variation, revision, adaptation, improvement, update, or upgrade thereto, or any derivative work thereof, (b) developed or acquired by WatServ outside the performance of the Services, and any enhancement, modification, alteration, change, variation, revision, adaptation, improvement, update, or upgrade thereto, or any derivative work thereof, or (c) which, subsequent to the SOW Effective Date, is developed or acquired by WatServ in the performance of the Services and any enhancement, modification, alteration, change, variation, revision, adaptation, improvement, update or upgrade thereto or any derivative work thereof.
“WatServ Regulatory Requirements” means all Laws affecting WatServ’s performance of the Services under an applicable SOW.
“WatServ Tools” means any and all processes, materials, software, and products, including Intellectual Property in the foregoing, and any modifications, enhancements, or derivative works thereof, developed or used by or on behalf of WatServ in its delivery of Services that do not contain any of Customer’s Confidential Information and which do not qualify as a Deliverable.
1.2 Certain Rules of Interpretation. In this Agreement and the Schedules and Exhibits:
2.1 Framework. This Agreement contemplates the issuance of SOWs and Change Orders that describe the Services (and the respective fees) purchased by Customer. SOWs and Change Orders shall not be binding, nor shall either Party have any obligations under a SOWs or Change Order until such SOWs or Change Order is duly executed by authorized representatives of both Parties. Any changes to the terms of this Agreement may be made solely in accordance with Section 12.2 and Section 12.9. Special Customer requirements, if any, shall be specified in a SOW. Each SOW and Change Order shall be subject to the terms of this Agreement.
2.2 Provision of Services. WatServ will provide to Customer certain technology and management services, and other services provided in accordance with the provisions set forth or referenced in this Agreement as follows: (i) the services described in any SOW, any schedules annexed hereto (collectively, with the SOWs and any appendices attached thereto, the “Schedules”) from time to time; (ii) all other services and obligations of WatServ set out in this Agreement; and (iii) any inherent or standard services that WatServ customarily or generally provides to its customers in respect of the foregoing services (collectively the “Services”).
2.3 Subcontractors. WatServ may elect to perform the Services using subcontractors. WatServ will supervise the activities and performance of subcontractors and shall remain Customer’s sole point of contact regarding the performance of Services. If WatServ elects to use subcontractors, WatServ shall be responsible for subcontractors’ performance and any such subcontractor shall (i) agree to be bound by confidentiality provisions which at a minimum are substantially similar to those contained in this Agreement; (ii) utilize procedures to protect the confidentiality of Customer’s Confidential Information, if any, which are no less stringent than the obligations WatServ is subject to under this Agreement; and (iii) comply with all applicable Laws in accordance with Section 10.1 of this Agreement.
2.4 Change Orders. In the event Customer wishes to change the Services provided under an existing SOW, Customer shall send WatServ a written request detailing such changes (a “Change Order”) according to the change management procedure set forth in the applicable SOW. Change Orders are not binding on either Party until duly executed by authorized representatives of both Parties.
2.5 Independent Contractors; Non-Exclusive Relationship. The relationship between the Parties created by this Agreement is that of independent contractors, and not joint-venturers, agents, or employees. Except as expressly provided herein, the relationship established by this Agreement shall be non-exclusive. Customer may purchase from third parties any services similar to those provided by WatServ, and WatServ may provide to third parties any services or products identical or similar to the Services provided to Customer.
2.6 Maintenance. WatServ or Suppliers may be required to perform routine maintenance from time to time in connection with the Services. Routine maintenance may interrupt or otherwise impact the Services, depending on the nature of the work. Routine maintenances are planned to occur during off-peak hours (Eastern Time) and WatServ will use commercially reasonable efforts to notify Customer at least forty-eight (48) hours prior to such maintenance. WatServ or Suppliers may also, be required to perform emergency maintenance. Emergency maintenance may happen without notice and in case of emergency maintenance, WatServ will use commercially reasonable efforts to notify Customer as soon as reasonably possible and to perform such maintenance in a manner to minimize the interruption to the Services. It is Customer’s and Users’ responsibility to understand these notifications and take the necessary actions to minimize the impact on their respective business.
2.7 Updates. WatServ reserves the right to change or upgrade any equipment or software that It uses to provide the Services without notice to Customer. WatServ will install security patches, minor updates, upgrades and service packs (“Updates“), as it determines in its sole discretion, and reserves the right, but has no obligation, to roll back any Updates. Updates may change system behavior and functionality and as such may negatively affect the Services. WatServ cannot foresee nor be responsible or liable for service disruption or changes in functionality or performance due to Updates. WatServ is not responsible or liable for issues that may arise from incompatibilities between the Data and the Services, including any Updates.
2.8 New Releases and Replacement. Customer acknowledges and agrees that WatServ or Suppliers may modify a Service (by adding new features or functionalities to, or removing existing features or functionalities from, a Service) or may release a new version of a Service, at any time and for any reason, including to address customer needs or otherwise address competitive demands, to respond to a government regulation, order or law, or to advance innovation in its Service offerings. Customer acknowledges and agrees that WatServ or Suppliers may replace a Service with another Service offering equivalent functionalities at any time, provided that (a) any such replacement is required to address customer needs or otherwise address competitive demands, to respond to a government regulation, order or law, or to advance innovation in its Service offerings; and that (b) fees remain unchanged. Any such modification or replacement shall not constitute a default by WatServ under the Agreement.
2.9 End of Life. WatServ may, at any time and for any reason, including to address competitive demands, respond to a government regulation, order or law, or to advance innovation in its Service offerings, terminate a particular Service or cease to provide, with respect to a particular Service: (a) technical support; (b) bug fixes, security fixes or other Updates; and/or (c) maintenance services (“End of Life“). For any Service being planned for the End of Life, WatServ will notify you at least ninety (180) days prior to the End of Life effective date and will use commercially reasonable efforts to assist you for appropriate planning and suggest alternative services with substantially equivalent functionalities.
USE OF SERVICES
3.1 Access to Services. Subject to an in accordance with this Agreement, WatServ grants Customer a non-exclusive, non-sublicensable, worldwide, non-transferable (except as granted herein), revocable right, for the Term, to access and use the Services.
3.2 Permitted Use. Customer shall only use the Services for its own lawful, appropriate, permitted internal business, non-residential and non-personal use. Customer shall access and use the Services in compliance with Law and the terms and conditions of the Agreement, including any acceptable use policy and the other Schedules, and any other applicable WatServ procedures and policies that further define the provision and use of the Services.
3.3 Connectivity. Customer is responsible for making necessary arrangements with its internet service provider, telephone carriers, private bandwidth providers, and local equipment providers so that Customer has stable, reliable and adequate connectivity and local resources as necessary for expected response time and availability. Customer agrees that WatServ’s provision of the Services may depend on the completion of certain Customer tasks or adherence to Customer schedules outside of WatServ’s control; consequently the schedule for completion of the Services or any portion thereof may require adjustments or changes in the event such Customer tasks or schedules change or are modified or are not completed as anticipated, and Customer is responsible for the impact of such delays.
3.4 Account Information. Customer acknowledges that failure to timely update Account Information could result in unauthorized access to the Account or in the impossibility to communicate with Customer or to process payment on the Account. Accordingly, Customer agrees to maintain accurate Account Information by providing updates to WatServ promptly when any Account Information requires change. Customer acknowledges and agrees that in the event of any dispute regarding access to or legal ownership of an account or any portion thereof, including the Account, WatServ will resolve such dispute in its sole discretion. In addition, in the event of such a dispute, WatServ may immediately suspend, alter or terminate any relevant account, including the Account, or any portion thereof. Customer acknowledges and agrees that (i) as between WatServ and Customer, Customer (and not any individual administrative user) schedules maintenance with WatServ, regardless of any administrative designation; (ii) upon request, Customer will provide WatServ with any documentation it reasonably requests to establish ownership and rights to Customer’s Account and any related Data; and (iii) any authorized representative identified by Customer with respect to Customer’s Account who has the authority to bind Customer to any amendments, modifications or acknowledgements related to the Agreement or the Services.
3.5 Account Security. Customer acknowledges and agrees that it is solely responsible for (i) maintaining the confidentiality and security of passwords and other access information associated with its Account, and (ii) all activities that occur in connection with its Account, whether initiated by Customer, by others on its behalf or by any other means. Customer will notify WatServ immediately of any unauthorized use of its Account, or any other actual or potential breach of security. Customer acknowledges and agrees that WatServ will not be liable for any loss that Customer may incur as a result of any party using or accessing its Account, either with or without its knowledge and/or authorization. WatServ specifically disclaims all liability for any activity in Customer’s Account, whether authorized by Customer or not.
3.6 Data Compliance. All Customer Data provided to WatServ in connection with the Services shall (a) be server-ready, meaning that they shall be in a condition and form which requires no additional manipulation or verification on the part of WatServ; (b) comply with Law, the terms and conditions of the Agreement, including the Schedules, and any other applicable WatServ procedures and policies that further define the provision and use of the Services; and (c) be free of any and all malicious code, including disabling devices, drop-dead devices, time bombs, trap doors, Trojan horses, worms, computer viruses, and mechanisms that may disable or negatively impact the servers. Attempting to place or requesting placement of malicious code on WatServ’s servers shall be considered a material breach of the Agreement. Customer hereby represent and warrant that it owns or have the necessary licenses, rights, consents and permissions to use, post, place and otherwise transfer or transmit, the Customer Data in connection with the Services. WatServ may reject or delete Customer Data that Customer has placed, attempted to place, or have requested be placed on WatServ’s servers in breach of the Agreement. WatServ shall notify Customer of its rejection and provide Customer with an opportunity to amend or modify such Customer Data to meet the requirements of WatServ.
3.7 Data Processing. WatServ and its Suppliers may collect, use, transfer, disclose, and otherwise process Data as necessary to provide the Services or as otherwise necessary to carry out the purposes of the Agreement. Without limiting the generality of the foregoing, WatServ and its Suppliers may (a) use Personal Data to prevent or address service or technical problems, or at Customer’s request in connection with customer support matters and may (b) send direct communications to Customer and its Users related to the terms of the Agreement or delivery of the Services. Customer shall ensure that all requisite consents under Law shall have been obtained for the benefit of WatServ and its Suppliers to collect, use, transfer, disclose, and otherwise process Data as necessary to provide the Services or as otherwise necessary to carry out the purposes of the Agreement.
3.8 Suppliers. If Customer subscribes to, purchase, enable or engage Supplier Services pursuant to the Agreement, Customer acknowledges and agree that WatServ may have to provide Data to the applicable Supplier(s) and that WatServ Is not responsible or liable for any disclosure, modification, deletion or other use of Data resulting from any such access and use by such Supplier(s). Any exchange of Data between Customer and a Supplier is subject to the terms and conditions of such Supplier. Customer represents and warrant that Customer’s use of any Supplier Service constitutes Customer’s express consent to the access and use of Data by the applicable Supplier, and that such consent, use, and access is beyond WatServ’s control.
3.9 Customer Data.
3.10 Responsibility. Customer is solely responsible: (a) for the access and use of the Services in compliance with the terms of the Agreement; (b) for the content of the Data passing through Server’s network; and (c) for ensuring that Users comply at all times with the terms of the Agreement as it relates to their use of the Services. Customer acknowledges and agrees that: (i) WatServ is not obligated to exercise control over or monitor the content of the Data passing through Server’s network; and (ii) the actions of its Users in their use of the Services will be deemed to be actions by Customer and that any breach of the terms of the Agreement by its Users will be deemed to be a breach by Customer. Customer acknowledges and agrees that any access or use of the Services or any portion of the Services in violation of this Article 3 will be a material breach of the Agreement.
3.11 Prohibited Uses. Customer may not (a) sell, rent or lease the Services in any way, or transfer to any other person any of its rights hereunder; or (b) modify any of the Services or the WatServ Pre-Existing Technology save as otherwise expressly permitted by WatServ, nor adapt, translate, reverse engineer, decompile, disassemble, or otherwise attempt to discover the source code of the Services or the WatServ Pre-Existing Technology.
INTELLECTUAL PROPERTY RIGHTS
FEES, INVOICING AND PAYMENT
5.1 Fees, Invoice and Payment Terms. The fees for Services shall be set forth in the applicable SOW and shall be exclusive of all applicable taxes. Unless otherwise specified in the applicable SOW, WatServ shall submit invoices on a monthly basis for Services furnished during the preceding month and all amounts, including applicable taxes, are due and payable within thirty (30) days from the date of invoice. Unless otherwise expressly set forth in an SOW, any program or milestone payments shall be invoiced on a monthly milestone basis. In addition to the fees for Services, Customer shall reimburse WatServ for all out-of-pocket expenses incurred in accordance with the applicable SOW within thirty (30) days from the date of invoice. Customer requests for resubmission of an invoice due to format changes are due based on the original invoice date.
5.2 Taxes. Except to the extent that Customer provides WatServ with a complete and valid exemption certificate, Customer shall be invoiced for and agrees to pay all applicable sales, service, value-added, lease, use, personal property, excise, withholding or similar consumption and other taxes and duties, whether assessed to Customer or WatServ on the provision of the Services excluding any taxes based on WatServ’s capital or net income. The Parties shall cooperate fully with each other to more accurately determine tax liability and to minimize such liability to the extent legally permissible (e.g. through tax exemptions, resale certificates, or local billing). Each Party shall be responsible for its own income taxes and for any sales, lease, use, personal property, or other such taxes on equipment, software, or property it owns or leases from a third party.
5.3 Amendments. WatServ reserves the right to increase the fees upon ninety (90) days’ prior notice to Customer. Customer’s continued use of the Services after the effective date of such increase will be deemed to be acceptance by Customer of the updated fees. If Customer does not agree with such increase, Customer may terminate the applicable SOW with respect to such Services by providing written notice to WatServ, provided, however, that such notice must be received within fourteen (14) days after WatServ’s notification and that such termination will be deemed a termination for convenience by Customer for the purpose of the Agreement.
5.4 Disputes; Late Payments. Customer agrees to provide WatServ with written notice of any disputed invoice items within fifteen (15) days of receipt of invoice. If Customer disputes any item on an invoice, Customer shall pay all undisputed portions of the invoice as provided in Section 5.1. If Customer fails to pay or dispute a balance as provided in this Article 5, (a) Customer shall pay, on demand, interest at the lesser of one and one half percent (1.5%) per month (eighteen percent (18%) per annum), or the highest rate allowed by applicable Law on such balance from the due date until paid; (b) WatServ may charge an administrative fee equal to five percent (5%) of the invoice for each month in which the invoice is not paid; and (c) WatServ may suspend further performance of Services. In the event of suspension, Customer shall be responsible for any costs incurred by WatServ. The assessment and acceptance, or any non-assessment, of any late charge shall not be construed as a waiver by WatServ of its rights with respect to the default giving rise to such payment and shall not affect any of WatServ’s rights under this Agreement or its remedies at Law.
TERM AND TERMINATION
6.2 Statement of Work.
6.3 Effect of Termination.
7.1 Confidentiality. During the term of this Agreement and any applicable SOW, each Party may have access or have disclosed to it to certain Confidential Information of the other Party and/or its Affiliates. Each Party agrees for a period of five (5) years from expiration or termination of this Agreement or applicable SOW, whichever is applicable, to (a) use the disclosing Party’s Confidential Information solely in connection with its performance under this Agreement and any applicable SOW; (b) disclose the disclosing Party’s Confidential Information only to its Representatives who have a need to know, provided that such Representatives are bound by a duty of confidentiality to such Party, whether legal, contractual or fiduciary; (c) protect the disclosing Party’s Confidential Information from disclosure in the same manner and to the same duty of care that the receiving Party uses to protect its own Confidential Information of like importance, but in no event less than a reasonable standard of care; and (d) return or destroy the disclosing Party’s Confidential Information promptly upon request of the disclosing Party at the completion of the Services. Notwithstanding the foregoing, a Party and its Representatives (i) may retain Confidential Information of the disclosing Party in accordance with policies and procedures implemented by such persons in order to comply with Law, regulatory requirements, professional accountancy standards, or document retention policies, and (ii) will not be required to destroy electronic back-up versions of the Confidential Information to the extent such destruction is not reasonably practical.
7.2 Disclosure of Confidential Information. In the event that the receiving Party or its Representatives are required to disclose any of the disclosing Party’s Confidential Information pursuant to Law, or by production order, discovery obligation, deposition, interrogatory, request for documents, subpoena, civil investigative demand or similar process, the receiving Party shall, if not prohibited by Law or production order, etc. (a) promptly notify the disclosing Party of the terms and the circumstances of any such request; (b) consult with the disclosing Party and cooperate with the disclosing Party’s reasonable requests to resist or narrow any such request; (c) furnish only Confidential Information that the receiving Party is legally compelled to disclose; and (d) use reasonable efforts to obtain an order or other reliable assurances that confidential treatment will be accorded the Confidential Information disclosed. Notwithstanding anything contained herein, no notice shall be required by a Party or its Representatives, and such Party and its Representatives may disclose Confidential Information, in connection with a routine audit or examination by a regulator or an auditor, or by a Supplier to ensure compliance with this Agreement and any other agreement applicable to the Services provided to Customer.
7.3 Ownership of Confidential Information. As between the Parties, the Confidential Information, including permitted copies, will be deemed the property of the disclosing Party. No Intellectual Proprietary right is licensed, granted, or otherwise transferred by this Agreement, any SOW or any Change Order, except for the right to use or disclose such information in accordance with this Agreement and applicable SOWs or Change Orders. Receiving Party shall reproduce in full all confidentiality notices set forth on the Confidential Information.
7.4 Equitable Relief. The Parties acknowledge that monetary damages may be inadequate to compensate the disclosing Party in the event that the receiving Party (or a Representative of the receiving Party) breaches any provision of this Article 7 and agree that, in addition to any remedies at law, the disclosing Party shall be entitled to seek equitable relief, including injunction and specific performance, without the need to prove actual damages or provide a bond.
7.5 De-Identified Data Use. WatServ may use certain content and transaction information to create information that is de-identified, such that it can not be identified to Customer, and which is sometime referred to as “big data” (hereinafter “Content”). Content may be used and disclosed consistent with applicable Law. Customer grants to WatServ a non-exclusive right and license to use Content including the right of aggregation with data received from other customers, suppliers and users of WatServ’s services for the general provision of data aggregation and comparison services, statistical analysis, the creation and maintenance of comparative databases, product support and development, system analytics, and benchmarking analysis, so long as WatServ does not identify Customer or any individual person associated with Customer and the data remains in an aggregated form. To the extent that the Content has been de-identified, and notwithstanding anything set forth herein to the contrary in this Agreement, WatServ may retain such Content, provided that such Content shall be used or disclosed solely for such purposes provided in this Section 7.5.
8.1 Services Warranty.
8.2 DISCLAIMER. EXCEPT FOR ANY PASS-THROUGH WARRANTIES PROVIDED BY THE SUPPLIER, WATSERV PROVIDES ALL SOFTWARE “AS-IS” WITHOUT ANY WARRANTIES, INTELLECTUAL PROPERTY INDEMNITIES OR OTHER PRODUCT LIABILITY. EXCEPT AS EXPRESSLY PROVIDED IN THIS ARTICLE 8, WATSERV DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE AND INFRINGEMENT, AND ANY WARRANTY ARISING BY STATUTE, OPERATION OF LAW, COURSE OF DEALING OR PERFORMANCE, OR USAGE OF TRADE. WATSERV DOES NOT GUARANTEE OR WARRANT THE SECURITY OF ANY DATA (INCLUDING CONFIDENTIAL INFORMATION) THAT WATSERV RECEIVES AND STORES ON ITS OR ITS SUPPLIERS’ SYSTEMS. CUSTOMER ASSUMES ALL RESPONSIBILITY FOR DETERMINING IF THE SERVICES ARE SUFFICIENT FOR CUSTOMER’S PURPOSES.
9.1 Mutual General Indemnification. Each Party shall indemnify, defend, and hold the other Party harmless and pay resulting costs (including damages and reasonable attorneys’ fees finally awarded), from and against any liability, loss, expense, or claim asserted by third parties (collectively, the “Claims” and individually each a “Claim”) for (a) damage to, or destruction of, real or tangible personal property, or for bodily injury (including death) to persons, or both, to the extent such damage or injury is attributable to the gross negligence or willful misconduct of such indemnifying Party, (b) its breach of the confidentiality obligations in Article 7; provided, the Party requesting indemnification gives the indemnifying Party prompt written notice of any such Claim and all necessary information and assistance so that such indemnifying Party, at its option, may defend or settle such claim, and; provided further, that such indemnifying Party does not take any adverse position in connection with such Claim. In the event that any such Claim is the result of, arises out of, or is in connection with the joint or concurrent negligence of both Parties as determined by a court of competent jurisdiction, the liability, loss, expense, or damage of such Claim shall be borne by each Party in proportion to its respective negligence or fault.
9.2 Infringement Indemnification. Each Party will defend, indemnify, hold the other Party harmless, and pay resulting costs (including damages and reasonable attorneys’ fees finally awarded) from a Claim that (a) in the case of WatServ, the WatServ Pre-existing Technology, the WatServ Tools that are owned by WatServ or any Deliverables as provided to Customer (“WatServ Material”), or (b) in the case of Customer, Customer Pre-existing Technology and Customer Intellectual Property (“Customer Material” and collectively with WatServ Material, the “Material”) infringes a third party’s patents, or copyright rights enforceable in a country signatory to the Berne Convention, provided that (i) the indemnified Party promptly notifies the indemnifying Party in writing of the claim; (ii) the indemnified Party cooperates fully and timely with such indemnifying Party in the defense of the Claim; and (iii) such indemnifying Party has sole control of the defense of the Claim and all related settlement negotiations; provided, further, that no settlement shall be entered into by the indemnifying Party prior to the indemnified Party giving its written consent to the terms of such settlement involving un-indemnified or non-monetary claims. Should the use of any indemnifying Party’s Material (or any portion thereof) be enjoined, or if in indemnifying Party’s opinion are likely to be enjoined, indemnifying Party shall, at its sole option, either (A) substitute a functionally equivalent non-infringing version of the affected portion(s) of indemnifying Party’s Material; (B) modify the infringing aspect of such Material so that it no longer infringes but remains a fully functionally equivalent; (C) obtain for the indemnified Party, at the indemnifying Party’s expense, the right to continue to use or receive the benefits of the indemnifying Party’s use of (as applicable) such Material; or (D) if none of the foregoing is commercially feasible and the Material is WatServ’s, then Customer shall return the applicable WatServ Materials and shall receive a refund for the fees paid by Customer for such WatServ Materials. Notwithstanding any provision in this Agreement or any SOW to the contrary, in no event shall WatServ have any duty to indemnify Customer pursuant to this Section 9.2 in connection with any Services alleged to infringe any third party’s patent or copyright rights enforceable in a country signatory to the Berne Convention, as a result of WatServ’s use of or reliance on any of Customer’s Confidential Information. Notwithstanding any provision in this Agreement or any SOW to the contrary, in no event shall either Party have any duty to indemnify the other Party pursuant to this Section 9.2 with respect to any claim of infringement to the extent that it arises out of: (a) the indemnifying Party following the designs, specifications, or written instructions of the indemnified Party; (b) such indemnified Party’s failure to obtain proper licenses for any Intellectual Property, including but not limited to, hardware, software, tools, or designs provided by indemnified Party for use hereunder; (c) such indemnified Party’s use of the indemnifying Party’s Material in a manner not reasonably contemplated in this Agreement, or any applicable SOW; or (d) Customer’s modification of the Services, or use of the Services in conjunction with hardware, software, systems, or methods not provided by WatServ or specified in the SOW. THE RIGHTS AND REMEDIES PROVIDED IN THIS SECTION 9.2 SHALL BE EACH PARTY’S EXCLUSIVE REMEDY FOR ANY AND ALL CLAIMS FOR INFRINGEMENT OF THE INFRINGING MATERIAL.
9.3 LIMITATION OF LIABILITY. EXCEPT FOR, THE PAYMENT FOR SERVICES DELIVERED UNDER ANY SOW, A PARTY’S INDEMNIFICATION OBLIGATIONS UNDER ARTICLE 9, OR FOR A PARTY’S (A) GROSS NEGLIGENCE, (B) WILLFUL MISCONDUCT, (C) FRAUD, OR (D) FRAUDULENT MISPREPRESENTATION, EACH PARTY’S ENTIRE LIABILITY UNDER THIS AGREEMENT OR ANY SOW, REGARDLESS OF LEGAL THEORY, SHALL NOT EXCEED IN THE AGGREGATE THE LESSER OF: (a) $200,000, OR (b) FEES PAID BY CUSTOMER FOR THE SERVICES IN THE TWELVE (12) MONTH PERIOD PRIOR TO THE MONTH IN WHICH THE CLAIM AROSE UNDER THE APPLICABLE SOW. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS AGREEMENT OR ANY SOW, IN NO EVENT SHALL WATSERV BE LIABLE FOR ANY DAMAGES WHATSOEVER ARISING OUT OF OR CAUSED BY (1) ANY THIRD PARTY OR THE ACT OR OMISSION OF A SUPPLIER, (2) CUSTOMER OR ITS USERS, (3) WATSERV’S ACCESS TO CUSTOMERS OR USERS COMPUTER EQUIPMENT(S) OR NETWORKS) OR (IV) ANY OTHER EVENTS BEYOND THE REASONABLE CONTROL OF WATSERV. IN NO EVENT SHALL EITHER PARTY BE RESPONSIBLE TO THE OTHER FOR INCIDENTAL, INDIRECT, PUNITIVE, SPECIAL, EXEMPLARY, OR CONSEQUENTIAL DAMAGES, INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOST REVENUE, OR DIMUNITION IN GOODWILL, OF THE OTHER PARTY, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THE FOREGOING DISCLAIMER OF LIABILITY SHALL APPLY WHETHER SUCH LIABILITY IS BASED ON BREACH OF CONTRACT, CONTRACTUAL OR EXTRA-CONTRACTUAL LIABILITY, TORT, INCLUDING STRICT LIABILITY, BREACH OF A FUNDAMENTAL TERM, FUNDAMENTAL BREACH, OR OTHERWISE.
LEGAL AND REGULATORY COMPLIANCE; INSURANCE
10.1 Legal and Regulatory Compliance.
11.1 Audit Rights. Each Party shall be entitled, at its own expense, from time to time on thirty (30) days prior written notice, but not more frequently than once in any calendar year during the term of the Agreement, to conduct an audit to confirm the other Party’s compliance with their material obligations under this Agreement. Such audit will be reasonable in terms of time and scope, and the audited Party has no obligation to provide information protected from such release by the audited Party’s policy, information not related to the audited Party’s material obligations under this Agreement, confidential information of third parties, or any other confidential information that the audited Party is prohibited to provide to the auditing Party by contract, applicable Law or otherwise. At least thirty (30) days before an audit, the auditing Party shall provide the audited Party with a proposed audit plan. The Party to be audited may reasonably object to the scope and/or specific items to be audited on the grounds that it oversteps the audit rights in this Section. The auditing Party shall promptly provide the other Party with a copy of any written report or other results of the audit. Customer shall be invoiced by WatServ and pay to WatServ within thirty (30) days from the date of such invoice for audit support exceeding two (2) hours per year at their then current billable rates.
12.1 Entire Agreement. This Agreement and the applicable SOW contain the entire understanding of the Parties hereto with respect to the subject matter hereof and thereof. There are no representations, warranties, covenants or other agreements between the Parties in connection with the subject matter of the applicable SOW other than those expressly set forth herein and in such applicable SOW. This Agreement and the applicable SOW supersede all prior agreements, understandings, negotiations and discussions, whether oral, written or otherwise, of the Parties with respect to the subject matter of the applicable SOW.
12.2 Amendments. This Agreement may only be modified or amended through a written document that must clearly and conspicuously indicate the specific Article(s) or Section(s) of this Agreement that are to be modified or amended and must be duly executed by authorized representatives of both Parties. Any applicable SOW may only be modified through a Change Order in accordance with Section 2.4 or through a written amendment that must clearly and conspicuously indicate the specific Article(s) or Section(s) of such SOW that are to be modified or amended and must be duly executed by authorized representatives of both Parties.
12.3 Survival. In the event of the expiration or termination of this Agreement or applicable SOW, those provisions which by their nature are intended to survive shall survive and continue in effect.
12.4 Assignment; Successors. Neither Party shall assign this Agreement or SOW, or any of its rights hereunder or thereunder, or delegate any of its duties hereunder or thereunder to a third party without the prior written consent of the other Party; provided, however, that either Party may assign, delegate or transfer its obligations under this Agreement or SOW, in whole but not in part, upon written notice to the other Party to (a) an entity or entities acquiring all or substantially all of the Party’s assets; or (b) an Affiliate, provided however that Customer shall provide WatServ with notice of such assignment in reasonable detail and any such assignee of Customer shall be subject to credit approval by WatServ. Any attempted assignment or delegation not expressly permitted by this Section 12.4 shall be void and of no force and effect. Subject to the foregoing, this Agreement and each applicable SOW shall inure to the benefit of and be binding upon the Parties hereto and their permitted successors, assigns, heirs, and legal representatives.
12.5 Consents, Approvals, and Requests. Unless otherwise stated in this Agreement or applicable SOW, all consents and approvals to be given by either Party hereunder or thereunder shall not be unreasonably withheld, conditioned, denied, or delayed.
12.6 Publicity; Trademarks. WatServ shall be permitted to (a) reference Customer’s name and/or logo as a customer of WatServ in WatServ’s marketing materials (including but not limited to, brochures, Web sites, and other communication vehicles); (b) issue a press release announcing the Parties’ business relationship (to be reviewed and approved by Customer); and (c) request that Customer answer a reasonable number of inquiries from prospective customers and media/industry analysts (to be coordinated by WatServ with Customer in order to minimize any disruption to Customer).
12.7 Notices. All notices, requests, authorizations, consents, waivers, and other communications under this Agreement and any applicable SOW must be in writing and will be deemed to have been duly given when (a) delivered personally, with written confirmation of receipt; (b) delivered, if sent by a nationally recognized overnight delivery service, in each case to the appropriate addresses set forth on the first page of this Agreement, or to such other addresses as a Party may designate by notice to the other Party.
12.8 Third-Party Beneficiaries. The Parties understand and agree that this Agreement and any applicable SOW are entered into solely for the benefit of the Parties and this Agreement and any applicable SOW shall not be construed to create any legal, equitable, or beneficial interest in any third party or to vest in any such third party any interest with respect to the enforcement of the Agreement except that Customer acknowledges and agrees that Suppliers shall be deemed to be third party beneficiaries of the Agreement. In the event of a default by Customer under the terms of the Agreement, any Supplier will be entitled to enforce the provisions of the Agreement and to verify Customer’s compliance with the terms of the Agreement.
12.9 Order of Precedence. In the event of a conflict, ambiguity, or inconsistency between this Agreement and any SOW, the terms of this Agreement shall control, provided however, a specific SOW may take precedence over the Agreement to the extent that the SOW expressly avers that it is to supplant the Agreement, sets forth the provision being supplanted, and is expressly approved in writing by authorized representatives of each Party solely for purposes of such SOW.
12.10 Severability. If any provision of this Agreement or the applicable SOW, or the application of any such provision to any person, entity, or circumstance shall be declared judicially to be invalid, unenforceable, or void, such decision shall not have the effect of invalidating, rendering unenforceable or voiding any portion of the remainder of this Agreement or applicable SOW it being the intent and agreement of the Parties hereto that this Agreement or applicable SOW shall be deemed amended by modifying such provision to the extent necessary to render it valid, legal, and enforceable, while preserving its intent or if such modification is not possible by substituting therefore another provision that is valid, legal, and enforceable and that achieves the same objective.
12.11 Waiver; Remedies. No delay or failure by either Party to exercise or enforce at any time any right or provision of this Agreement or any applicable SOW shall be considered a waiver thereof or of such Party’s right thereafter to exercise or enforce each and every right and provision of this Agreement or any applicable SOW. A waiver to be valid shall be in writing and signed by the Party waiving a right or provision of this Agreement or an applicable SOW but need not be supported by consideration. A valid waiver of any provision of this Agreement or applicable SOW with respect to a particular situation or event shall not constitute a waiver of such provision with respect to other situations, events, or agreements. Except where expressly stated as an exclusive remedy, in addition to the remedies expressly available under this Agreement and any applicable SOW, the Parties shall have any and all additional remedies available to them, whether at law or in equity, and all remedies shall be cumulative. No action under this Agreement or any SOW may be brought by either Party more than two (2) years after the cause of such action becomes known to such Party.
12.12 Force Majeure.
12.3 Non-Solicitation. Each Party will not, during the term of this Agreement and any applicable SOW, and for six (6) months thereafter, directly or indirectly solicit for employment, employ or utilize the services of, any person who is an employee of the other Party or its subcontractors and assignees who has been involved in activities related to the Services provided hereunder (whether in the capacity of an employee, consultant, independent contractor, or as an employee of a subcontractor or consultant) unless and until the Party soliciting employment or services pays to the other Party, as liquidated damages and not as a penalty, and as its sole and exclusive remedy, an amount equal to the aggregate compensation (including bonuses) paid by the employer or any of its Affiliates to such employee during the six (6) months prior to the date such employee is employed by or provides services to the soliciting Party. Notwithstanding the foregoing, and unless undertaken as a means to circumvent or conceal a violation of this Section 12.13, neither the publication of classified advertisements in newspapers, periodicals, internet bulletin boards, or other publications of general availability or circulation nor the consideration and hiring of a person responding to such general advertisements shall be deemed a breach of this provision.
12.14 Applicable Law. This Agreement shall be construed in accordance with the laws of the State of Delaware and shall be treated, in all respects, as a Delaware contract, and the Parties hereby irrevocably submit to the exclusive jurisdiction of the courts of the State of Delaware and hereby agree that any such court shall be a proper forum for the determination of any controversy or dispute arising hereunder.
12.15 No Construction Against Drafter. The Parties agree and acknowledge that this Agreement and each applicable SOW, Change Order and Product Order was the subject of negotiation, each Party was represented by counsel, and each Party had an equal hand in drafting such document. The Parties further agree that any principle of construction or rule of law that provides that an agreement shall be construed against the drafter of the agreement in the event of any inconsistency or ambiguity in such agreement shall not apply to the terms and conditions of this Agreement, or any applicable SOW, Change Order or Product Order.
12.16 Counterparts. This Agreement and any SOW or Change Order may be executed by two or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same agreement. This Agreement or any SOW may be executed electronically, through electronic image or verified e-signature, and transmitted by facsimile or electronic image.