Form 23-2

Client Services Agreement

[For Service Provider Company]

This agreement (“Agreement”) between [name of client], a Texas [type of entity] (“Cli­ent”), and [name of limited liability company], a Texas limited liability company (“Com­pany”), is meant to be fair to both Client and the Company (individually, “Party,” and collectively, “Parties”). By signing this contract, Client agrees to pay for services discussed in this Agreement. In return, the Company agrees to provide consulting services as agreed between the Company and Client.

1.Company’s Role. The Company will provide [specify] services to Client as stated in this Agreement and as agreed in the attached Exhibit A hereto and incorporated herein (“Ser­vices”). As part of the Services, the Company will deliver to Client all work product (collec­tively, “Deliverables”) specified in a Statement of Work (“SOW”) in accordance with the specifications and, if applicable, timelines set forth in the SOW. Client engages the Company to provide the Services as an independent contractor. This Agreement shall not be construed as an agreement of fiduciary relationship, partnership, joint venture, or any other form of busi­ness arrangement other than as an agreement for independent contractual services. Neither Party shall have the right or authority to bind or obligate the other for anything in any manner, nor shall either Party make any commitments or representations to the other except represen­tations furnished in writing between the Parties. [Include if applicable: The Company may use subcontractors in fulfillment of the Services as deemed necessary in the Company’s sole dis­cretion.]

2.Limitation of Services. The Company does not provide [specify] services. The Com­pany does not guarantee any particular results to Client as a result of performing the Services. The Company is not responsible for any Client costs or losses associated with [specify].

3.Obligation to Provide Accurate Information. Client agrees to provide the Company with accurate, reliable, and complete information as requested to complete the agreed Ser­vices. Client understands that the Company will rely exclusively on the information provided and that Client’s failure to provide complete and accurate information may result in errors or omissions during the Services term. Client will provide the Company with access to all [spec­ify, e.g., technical data, computer programs, files, client information, documentation, graphic images, vendor account information,] and other information and resources that may be required to permit the Company to perform the Services in accordance with the terms of this Agreement and as may be further set forth in the applicable SOW (collectively, the “Client Data”). [Include if applicable: To the extent any Client Data is stored on the Company’s sys­tems or equipment, Client will, at all times during the Term, maintain the Client Data in strict accordance with all reasonable security measures customary in the industry and with all appli­cable laws, including laws governing privacy and data security.]

4.Compensation. It is mutually agreed that Client will pay the Company for the Services at the rates and schedule (“Company Fees”) stated in Exhibit A. Once the Company receives the signed Agreement from Client, the Company will reserve the required amount of time for Client’s Services. Client will submit all payments due to the Company pursuant to the sched­ule shown in Exhibit A. Should any Company Fees not be paid by Client within [number] days of becoming due, a carrying fee calculated at [percent] percent annually and charged monthly shall be charged on the outstanding balance. Interest on amounts owed by Client will not exceed the maximum rate or amount of nonusurious interest that may be contracted for, taken, reserved, charged, or received under law. Any interest in excess of that maximum amount will be credited to Client.

5.Term and Termination. The term of the Agreement begins on [date] (“Effective Date”) and will continue for an initial term of [number] days (“Term”). Client or the Company may terminate this Agreement by giving [[number] days’ written notice to the other/written notice to the other, [number] days in advance if by Client and [number] days in advance if by the Company] (“Termination Notice”). In case of termination by the Company, Client will receive a prorated refund for any prepaid amounts that did not result in Services received. All expenses incurred by the Company on Client’s behalf in excess of the paid amount at the time of termination will be billed to Client. If the Company receives notice of cancellation after posted business hours, the notice will be deemed received on the following business day.

Upon termination of this Agreement in its entirety—

a.all SOWs in effect at the time of the termination shall automatically termi­nate;

b.except as set forth in section 9 below and legal obligations, rights, and duties that have accrued before the effective date of the termination, all legal obliga­tions, rights, and duties of the Parties arising out of this Agreement will ter­minate;

c.the Company will deliver to Client all Services in progress (whether complete or incomplete), all Client Data and Background Technology (defined in sec­tion 8(c) below) of Client provided to the Company (collectively, “Receiv­ables”) and copies thereof, and all hardware, software, tools, equipment, or other materials provided to the Company by Client;

d.Client shall promptly pay the Company for all Services rendered and all expenses incurred up to and including the effective date of the termination, provided that Client shall pay a pro rata portion of any Company Fees owed for Services that are incomplete at the time of the termination and for which payments have not been made, and upon that payment the Company shall deliver to Client copies of all the incomplete work; and

e.each Party will (i) either return or destroy (at the other Party’s sole option) all Confidential Information of the other Party then in possession or control, including all tangible documents and materials (and any copies thereof) con­taining, reflecting, incorporating, or based on the Confidential Information; (ii) permanently erase from its computer systems and networks all such Con­fidential Information; and (iii) certify in writing to the other Party its compli­ance with the terms of this section 5(e).

6.Mutual Representation and Warranties. Each Party represents and warrants that—

a.it is duly organized, validly existing, and in good standing as a corporation or other entity under the laws of the jurisdiction of its incorporation or other organization;

b.it has the full right, power, and authority to enter into, and to perform its obli­gations and grant the rights and licenses it grants or is required to grant under, this Agreement;

c.the execution of this Agreement by its representative whose signature is set forth at the end of this Agreement has been duly authorized by all necessary corporate or organizational action of that Party;

d.when executed and delivered by both Parties, this Agreement will constitute the legal, valid, and binding obligation of the Parties, enforceable against each in accordance with its terms;

e.its performance of its obligations under this Agreement will not violate the terms of any agreement with a third party; and

f.it will comply with all applicable federal, state, and local laws and regula­tions in the performance of its obligations.

7.Representations and Warranties of Client. Client represents and warrants to the Com­pany that—

a.Client has secured all permissions necessary for the Company’s performance of the Services;

b.the agreed Services [, including but not limited to Client Data and Back­ground Technology,] do not and, to the best of Client’s knowledge, will not infringe on, violate, or misappropriate any Intellectual Property Rights (defined in section 8(a)(ii) below) or any contractual, publicity, privacy, or proprietary right of any third party; [and]

c.Client has secured all rights and licenses necessary from third-party owners or licensors for all of those third parties’ components or intellectual property provided to the Company to perform the Services in this Agreement [./; and]

d.Client Data and Background Technology will not contain any malware, viruses, or other disabling devices or any codes or instructions that can access, modify, damage, or disable the Company’s computer networks or systems.

8.Intellectual Property. The Company reserves the right to display a copy of any materi­als created for Client in its portfolio, website, and other marketing materials.

a.Definitions. For purposes of this Agreement—

i.“Background Technology” has the meaning given to the term in section 8(c) below;

ii.“Intellectual Property Rights” means all intellectual property rights aris­ing under the applicable laws of the United States or of any other juris­diction or provided by international treaties or conventions, including—

(a)patents, patent applications (including patents issued thereon), and statutory invention registrations, including reissues, divisions, con­tinuations, continuations in part, extensions, and reexaminations thereof;

(b)all rights in any original works of authorship or any part thereof that are within the scope of any applicable copyright law, including all rights of authorship, use, publication, reproduction, distribution, or performance, all moral rights, all rights of ownership of copyright­able works, and all rights to register and to obtain renewals, exten­sions, revivals, and resuscitations of any such copyright registrations;

(c)marks (including any copyrights therein) and other identifiers, including all goodwill associated therewith, all common-law rights, all registrations and applications for registration thereof, and all reissues, extensions, and renewals of any of the foregoing;

(d)trade secret and confidential and proprietary information, including trade secrets, confidential processes, compositions, formulas, cus­tomer information, operational data, processing quality control pro­cedures, research and development studies, engineering information, invention reports, laboratory notebooks, technical reports, research and development archives, pricing information, and know-how; and

(e)database and design rights, including rights related to Technology (defined in section 8(a)(iii) below), domain names, or domain name registrations and reservations; and

iii.“Technology” means software, technology, designs, formulas, algo­rithms, procedures, methods, discoveries, processes, techniques, ideas, know-how, research and development, technical data, tools, materials, specifications, processes, inventions (whether patentable or not and whether reduced to practice or not), innovations, apparatuses, creations, improvements, works of authorship, copyrightable works, mask works, and other similar materials; all recordings, graphs, drawings, reports, analyses, writings, and other tangible embodiments of any of the forego­ing, in any form or medium; and all other information, data, and technol­ogy related thereto.

b.Deliverables. The Company acknowledges that the Deliverables have been specially ordered and commissioned by Client and that, as such, all Delivera­bles will be deemed “works made for hire,” as defined by the Copyright Revision Act of 1976, amended from time to time, at 17 U.S.C. § 101(7)(2)(3)(2)(C). Client will own all copyrights in the Deliverables upon payment in full to the Company. Interim work papers, research, drafts, notes, and the like prepared by the Company in the course of providing the Services will remain the exclusive property of the Company.

c.Background Technology. Each Party will retain all right, title, and interest, including all Intellectual Property Rights, in and to any Technology owned or controlled by the Party before the Effective Date or conceived of, generated, created, or otherwise developed by or on behalf of that Party outside the scope of this Agreement (collectively, “Background Technology”).

d.Client Data and Limited License. Client will exclusively own and retain all right, title, and interest, including all Intellectual Property Rights, in and to all Client Data provided to the Company. Client grants to the Company a lim­ited, nonexclusive, royalty-free, fully-paid-up, nontransferable, nonsubli­censable license in and to the Data to the extent necessary to enable the Company to perform the Services and other obligations under this Agree­ment. Other than the foregoing limited license, nothing in this Agreement will convey, transfer, or assign to the Company any right, title, or interest in or to the Client Data.

9.Confidential Information. The Parties acknowledge that in the course of dealings between them, each may acquire information or materials about the other that are confidential or proprietary in nature, such as business activities and operations, know-how, pricing, techni­cal information, and trade secrets (“Confidential Information”). Such information will be treated as confidential (a) if it is marked or accompanied by documents clearly and conspicu­ously designating them as “confidential” or the equivalent or (b) if it is identified by the dis­closing Party as confidential before, during, or within twenty-four hours after the presentation or communication and the communication is reduced to writing, marked confidential, and delivered to the other Party within ten days of the original disclosure. For a period commenc­ing on the Effective Date and continuing through two years after the date of the termination or expiration of this Agreement, each Party will use the same degree of care as it uses for its own similar information, but no less than reasonable care, to protect the other Party’s Confidential Information and to prevent (a) any use of the other Party’s Confidential Information not authorized in this Agreement, (b) dissemination of Confidential Information to any employee or agent of the Party without a legitimate need to know and without the employee or agent being bound by a nondisclosure agreement with the receiving Party with terms and conditions at least as restrictive as those in this Agreement, (c) communication of the other Party’s Con­fidential Information to any third party, or (d) publication of the other Party’s Confidential Information. These restrictions of confidentiality will not apply, however, to any information that (a) was lawfully known to the receiving Party before receipt from the disclosing Party, (b) is or becomes publicly available through no fault of the receiving Party, (c) is rightfully received by the receiving Party from a third party without a duty of confidentiality, (d) is dis­closed by the disclosing Party to a third party without a duty of confidentiality on the third party, (e) is independently developed by the receiving Party without a breach of this Agree­ment, or (f) is disclosed by the receiving Party with the disclosing Party’s prior written approval. If a receiving Party is required by a governmental body or court of law to disclose information, the receiving Party agrees to give the disclosing Party no less than seven days’ reasonable advance notice so that the disclosing Party may contest the disclosure requirement or seek a protective order. Upon written demand of the disclosing Party, the receiving Party shall (a) cease using the Confidential Information; (b) return to the disclosing Party or destroy, as specified by the disclosing Party, the Confidential Information and all copies, notes, or extracts of it within seven business days of receipt of the notice; and (c) upon request of the disclosing Party, certify in writing that the receiving Party has complied with the obligations set forth in this paragraph.

10.Indemnification. Client shall defend, indemnify, and hold the Company and its offi­cers, agents, and employees (collectively, “Indemnified Parties”) harmless from and against all third-party allegations, claims, actions, suits, demands, damages, liabilities, obligations, losses, settlements, judgments, costs, and expenses (including without limitation attorney’s fees and costs) that arise out of or relate to the execution of this Agreement, except to the extent that the losses or damages result from the gross negligence or willful misconduct of the Indemnified Parties. Client shall specifically indemnify the Company for any third-party claims of intellectual property infringement related to Client Data, Background Technology, and any other information or intellectual property provided by Client to the Company for use in performance of the Services. [Include if applicable: Client shall specifically indemnify the Company for any governmental, police, or consumer action taken and civil claims asserted against the Company or Client’s customers related to this Agreement, including but not lim­ited to all laws and regulations referenced in section 18 below.]

11.Waiver and Release of Liability. Client releases and forever discharges the Company and its successors and assigns from all liability, claims, and demands of whatever kind or nature, either in law or in equity, that arise or may hereafter arise from contracting for the Company’s Services. Client understands and acknowledges that this Waiver discharges the Company from any liability or claim that Client may have against the Company for bodily injury, personal injury, illness, death, or property damage that may result from this Agreement and the Services of the Company, except for such injury, illness, death, or damage that may result from the Company’s gross negligence or willful misconduct. Client also understands that the Company does not assume any responsibility for or obligation to provide financial or other assistance, including but not limited to medical, health, or disability insurance, in the event of injury, illness, death, or property damage. Excepting damages incurred under sec­tions [specify] of this Agreement, damages will be limited to the amounts paid or owed as stated in Exhibit A.

12.Notices. All notices relating to this Agreement must be given in writing and will be deemed given (a) in the case of mail, three days after the date deposited in the mail, postage prepaid, and certified, with return receipt requested; (b) in the case of e-mail, on the date of submission; or (c) in the case of personal delivery to an authorized representative or officer of the Party, or in the case of express courier service or overnight delivery service of national standing, on the date of delivery or attempted delivery. Notice must be provided to the physi­cal or e-mail address in the Party’s contact information listed below or as periodically updated in writing by that Party.

13.Applicable Law and Dispute Resolution. The laws of the state of Texas shall govern the validity of this Agreement, the construction of its terms, and the interpretation of the rights and duties of the Parties.

Except as necessary for equitable relief described in section 14 below, a complaining Party must first contact the other Party directly to seek informal resolution in good faith by sending written notice of the matter in dispute to the appropriate contact as listed in this Agreement [include if applicable: before resorting to the formal dispute resolution steps described in this section 13].

Any controversies arising out of the terms of this Agreement or its interpretation shall be submitted to mediation in [county] County, Texas, [before [the filing of suit/initiating arbi­tration/the filing of suit or initiating arbitration] regarding the controversy] with mediation costs shared by the Parties.

[If the dispute is not resolved after attempted mediation in good faith, the matter/Any controversies arising out of the terms of this Agreement or its interpretation] shall be settled by [arbitration/a court of appropriate jurisdiction] in [city], [county] County, Texas [, in accor­dance with the rules of the American Arbitration Association]. Any award shall be final, bind­ing, and conclusive on the Parties. A judgment on the award rendered may be entered in any court having jurisdiction.

By entering into these Terms, each Party waives the right to a trial by jury or to partici­pate in a class action.

14.Equitable Remedies. Notwithstanding anything to the contrary in this Agreement, each Party acknowledges and agrees that a breach or threat of imminent breach by the Party of any of its obligations under sections [specify] through [specify] would cause the other Party irrep­arable harm for which monetary damages would not be adequate. Each Party agrees that in the event of such a breach or threat of imminent breach, the other Party will be entitled to equita­ble relief, including a restraining order, an injunction, specific performance, and any other relief that may be available from any court without any requirement to post a bond or other security or to prove actual damages or that monetary damages are not an adequate remedy. Such remedies are not exclusive and are in addition to all other remedies that may be available at law, in equity, or otherwise.

15.Modification, Entire Agreement, and Severability. No amendment, change, or modifi­cation of this Agreement shall be valid unless in writing and signed by both Parties. This doc­ument and any exhibit attached hereto constitute the entire understanding and Agreement of the Parties. In case of conflict between the main body of this Agreement and any attachment or exhibit, the terms of this Agreement will control. All prior agreements, understandings, and representations are hereby terminated and canceled in their entirety and are of no further force and effect. If any provision of this Agreement or any portion thereof is held to be invalid and unenforceable, the remainder of this Agreement shall nevertheless remain in full force and effect. Notwithstanding any termination of this Agreement for any reason, sections [specify] shall survive the termination of this Agreement. All licenses granted under the preceding sec­tions will immediately terminate upon termination of this Agreement.

16.Assignment, Waiver, and Amendments. Neither Party may assign its rights or delegate its duties under this Agreement without the prior written consent of the other Party. The fail­ure of either Party to this Agreement to object to or take affirmative action on any conduct of the other Party will not be construed as a waiver of any right under this Agreement. This Agreement may not be modified or amended except in writing signed by both Parties; no other act, usage, or custom will be deemed to amend or modify this Agreement. Nothing in this Agreement, express or implied, is intended to or will confer on any person or entity other than the Parties any right, benefit, or remedy of any nature whatsoever under or by reason of this Agreement.

17.Nonsolicitation. During the term of this Agreement and for a period of twelve months after its termination, Client agrees that it will not, either directly or indirectly, solicit, induce, recruit, or encourage any of the Company’s employees or contractors to leave their employ­ment by the Company, or hire or take away such employees or contractors, or attempt to solicit, induce, recruit, encourage, hire, or take away employees or contractors of the Com­pany, either for Client itself or for any other person or entity. Further, Client agrees that during the term and for a period of twelve months after the termination of this Agreement, Client will not, either directly or indirectly, attempt to inhibit or alter the Company’s customer, vendor, or other relationships.

[17./18.]Legal Compliance. Client assumes full responsibility for compliance with all applicable laws and regulations regarding its services and product sales and warrants to the Company that it is currently in compliance and will maintain compliance with all such laws and regulations. Those laws and regulations may include, but are not limited to, local munici­pal, state, and federal law; regulations of the federal drug administration, drug enforcement agency, and other federal agencies; and state agencies.

[18./19.]Signatures. The signatures below indicate both the Company and Client under­stand the content and terms in this Agreement.

IN WITNESS WHEREOF, this Agreement has been signed by the Parties to be effec­tive as of the Effective Date stated in this Agreement.

Client:
[Name of client], a Texas [type of entity]

By:      
     [Name], [title]
     [Address]
     [Phone]
     [Fax]
     [E-mail]

Date:       

Company:

[Name of limited liability company], a Texas limited liability company

By:      
     [Name], [title]
     [Address]
     [Phone]
     [Fax]
     [E-mail]

Date:       

Exhibit A

Services

1.Services. The Company will provide the following agreed Services to Client during the Term of the Agreement:

a.[specify]

2.Compensation

a.In exchange for Services rendered, Client will pay the Company according to the following schedule (“Company Fees”):

i.[specify]

b.Payment will be made according to the procedures described in section 4 of this Agreement.

Exhibit B

Statement of Work