1. WORK.

1.1 Project Work Order. For all work, the Client will send an initial Specification Package detailing the required work, or CALICO dmfg. will hold meeting with the Client to establish one. CALICO dmfg. will then produce an initial Work Order detailing the scope of work to be done with any and every reasonable component required to CALICO dmfg.’s knowledge, to produce the Clients intended Goods, and establish timelines for the production of work.

1.2 Schedule.  CALICO dmfg. will begin work upon approval of Work Order and receipt of initial payment and will continue until the work is completed.  CALICO dmfg. shall not commence work on the Goods, put work into its schedule, or confirm a delivery date of the Goods without first having received a valid intial payment and approved Work Order. Work will be broken up into phases with milestones as defined on the Work Order. CALICO dmfg. may require certain files from Client to produce the Goods and will make every effort to make Client aware of required files beforehand. Any timeline previously established may be subject to delay if required files cannot be furnished in a timely manner as required by the Work Order.

1.3 Specifications and Change Orders. CALICO dmfg. shall only be obligated to perform and may only be held to the specifications, tolerances, materials, or other conditions as specified on the Work Order. Any certification requirement must be requested prior to commencement of the project. Deviations from the Work Order arising from material availability, project feasibility as tested from prototype, Client requests, or any other related change to the initial scope is subject to a Change Order and must be documented, agreed upon and signed by both parties.

1.4 Estimations. CALICO dmfg. will quote work to the best of their ability and will aim to meet or stay within 15% over the initial quoted price. Exceeding 15% of the initial quoted price will be considered a change-order to be approved by Client.

1.5 Support. CALICO dmfg. will not provide support for any deliverable once the Client accepts it, unless otherwise agreed in writing.

2. PAYMENT.

2.1 Expenses. The Client will reimburse CALICO dmfg.’s expenses exceeding the original scope of the project if required by Change Orders. All material and labor expenses are otherwise built into the Work Order. Expenses under $300 do not need to be pre-approved  by the Client.

2.2 Invoices.  CALICO dmfg will invoice the Client in accordance with the milestones in each Work Order.

The Client agrees to pay the initial, nonrefundable amount (“Design Deposit”) owed within 14 days of receiving the invoice if a deposit is requested. Payment after that date will incur a non-compounding late fee of 1.5% per month on the outstanding amount.

The Client agrees to pay the following invoices owed within 14 days of receiving the invoice and delivery of work. Payment after that date will incur a non-compounding late fee of 1.5% per month on the outstanding amount.

3. OWNERSHIP AND LICENSES.

3.1 Client Owns All Work Product.  As part of this job, CALICO dmfg. is creating “work product”, or “Goods” for the Client. To avoid confusion, work product is the finished product, as well as drafts, notes, materials, mockups, hardware, designs, inventions, patents, code, and anything else that CALICO dmfg. works on explicitly for the project—that is, conceives, creates, designs, develops, invents, works on, or reduces to practice—as part of this project, whether before the date of this Contract or after. CALICO dmfg. hereby gives the Client this work product once the Client pays for it in full. This means CALICO dmfg. is giving the Client all of its rights, titles, and interests in and to the work product (minus intellectual property rights to developed manufacturing/design systems used in-house in Contractor’s place of business that may have been conceived or used during the course of the project), and the Client will be the sole owner of it. The Client can use the work product however it wants or it can decide not to use the work product at all. The Client, for example, can modify, destroy, or sell it, as it sees fit.

3.2 Contractor’s Use Of Work Product. Once CALICO dmfg. gives the work product to the Client, CALICO dmfg. does not have any rights to it, except those that the Client explicitly gives CALICO dmfg. here.

3.3 Contractor’s Help Securing Ownership.  In the future, the Client may need CALICO dmfg.’s help to show that the Client owns the work product or to complete the transfer. CALICO dmfg. agrees to help with that. For example, CALICO dmfg. may have to sign a patent application. The Client will pay any required expenses for this. If the Client can’t find CALICO dmfg., CALICO dmfg. agrees that the Client can act on CALICO dmfg.’s behalf to accomplish the same thing. The following language gives the Client that right: if the Client can’t find CALICO dmfg. after spending reasonable effort trying to do so, CALICO dmfg. hereby irrevocably designates and appoints the Client as CALICO dmfg.’s agent and attorney-in-fact, which appointment is coupled with an interest, to act for CALICO dmfg. and on CALICO dmfg.’s behalf to execute, verify, and file the required documents and to take any other legal action to accomplish the purposes of paragraph 2.1 (Client Owns All Work Product).

3.4 Contractor’s IP That Is Not Work Product.  During the course of this project, CALICO dmfg. might use intellectual property that CALICO dmfg. owns or has licensed from a third party, but that does not qualify as “work product.” This is called “background IP.” Possible examples of background IP are pre-existing code, type fonts, properly-licensed stock photos, and web application tools. CALICO dmfg. is not giving the Client this background IP. But, as part of the Contract, CALICO dmfg. is giving the Client a right to use and license (with the right to sublicense) the background IP to develop, market, sell, and support the Client’s products and services. The Client may use this background IP worldwide and free of charge, but it cannot transfer its rights to the background IP (except as allowed in Section 11.1 (Assignment)). The Client cannot sell or license the background IP separately from its products or services. CALICO dmfg. cannot take back this grant, and this grant does not end when the Contract is over.

3.5 Contractor’s Right To Use Client IP.  CALICO dmfg. may need to use the Client’s intellectual property to do its job. For example, if the Client is hiring CALICO dmfg. to build a website, CALICO dmfg. may have to use the Client’s logo. The Client agrees to let CALICO dmfg. use the Client’s intellectual property and other intellectual property that the Client controls to the extent reasonably necessary to do CALICO dmfg.’s job. Beyond that, the Client is not giving CALICO dmfg. any intellectual property rights, unless specifically stated otherwise in this Contract.

4. NON-SOLICITATION.

Until this Contract ends, CALICO dmfg. won’t: (a) encourage Client employees or service providers to stop working for the Client; (b) encourage Client customers or clients to stop doing business with the Client; or (c) hire anyone who worked for the Client over the 12-month period before the Contract ended. The one exception is if CALICO dmfg. puts out a general ad and someone who happened to work for the Client responds. In that case, CALICO dmfg. may hire that candidate. Calico DMFG promises that it won’t do anything in this paragraph on behalf of itself or a third party.

5. REPRESENTATIONS.

5.1 Overview.  This section contains important promises between the parties.

5.2 Authority To Sign.  Each party promises to the other party that it has the authority to enter into this Contract and to perform all of its obligations under this Contract.

5.3 Contractor Has Right To Give Client Work Product.  CALICO dmfg. promises that it owns the work product, that CALICO dmfg. is able to give the work product to the Client, and that no other party will claim that it owns the work product. If CALICO dmfg. uses employees or subcontractors, CALICO dmfg. also promises that these employees and subcontractors have signed contracts with Calico DMFG giving CALICO dmfg. any rights that the employees or subcontractors have related to CALICO dmfg.’s background IP and work product.

5.4 Contractor Will Comply With Laws.  CALICO dmfg. promises that the manner it does this job, its work product, and any background IP it uses comply with applicable U.S. and foreign laws and regulations.

5.5 Work Product Does Not Infringe.  CALICO dmfg. promises that its work product does not and will not infringe on someone else’s intellectual property rights, that CALICO dmfg. has the right to let the Client use the background IP, and that this Contract does not and will not violate any contract that CALICO dmfg. has entered into or will enter into with someone else.

5.6 Client Will Review Work.  The Client promises to review the work product, to be reasonably available to CALICO dmfg. if CALICO dmfg. has questions regarding this project, and to provide timely feedback and decisions.

5.7 Client-Supplied Material Does Not Infringe.  If the Client provides CALICO dmfg. with material to incorporate into the work product, the Client promises that this material does not infringe on someone else’s intellectual property rights.

6. TERM AND TERMINATION.

This Contract is ongoing until the work is completed. Either party may end this Contract for any reason by sending an email or letter to the other party, informing the recipient that the sender is ending the Contract and that the Contract will end in 7 days. The Contract officially ends once that time has passed. The party that is ending the Contract must provide notice by taking the steps explained in Section 11.4. CALICO dmfg. must immediately stop working as soon as it receives this notice, unless the notice says otherwise.  The Client will pay CALICO dmfg. for the work done up until when the Contract ends and will reimburse CALICO dmfg. for any agreed-upon, non-cancellable expenses. The following sections don’t end even after the Contract ends: 2 (Ownership and Licenses); 3 (Competitive Engagements); 4 (Non-Solicitation); 5 (Representations); 8 (Confidential Information); 9 (Limitation of Liability); 10 (Indemnity); and 11 (General).

7. INDEPENDENT CONTRACTOR.

The Client is hiring CALICO dmfg. as an independent contractor. The following statements accurately reflect their relationship:

CALICO dmfg. will use its own equipment, tools, and material to do the work.

The Client will not control how the job is performed on a day-to-day basis. Rather, CALICO dmfg. is responsible for determining when, where, and how it will carry out the work.

The Client will not provide CALICO dmfg. with any training.

The Client and CALICO dmfg. do not have a partnership or employer-employee relationship.

CALICO dmfg. cannot enter into contracts, make promises, or act on behalf of the Client.

CALICO dmfg. is not entitled to the Client’s benefits (e.g., group insurance, retirement benefits, retirement plans, vacation days).

CALICO dmfg. is responsible for its own taxes.

The Client will not withhold social security and Medicare taxes or make payments for disability insurance, unemployment insurance, or workers compensation for CALICO dmfg. or any of CALICO dmfg.’s employees or subcontractors.

8. CONFIDENTIAL INFORMATION.

8.1 CALICO dmfg. agrees to abide by the Client’s own separate non-disclosure agreement if applicable.

As used herein, “Confidential Information” shall mean any and all technical and non-technical information that Company provides Recipient, whether in graphic, electronic, written or oral form, and including but not limited to patent applications and other filings, trade secrets, and any other proprietary information, as well as any ideas, techniques, sketches, drawings, works of authorship, models, inventions, know-how, processes, algorithms, software programs, documents, and formulae related to the current, future, and proposed products and services of Company, and also any information concerning any research, experimental work, development, design details and specifications, engineering, financial information, purchasing, customer lists, investors, employees, business and contractual relationships, business forecasts, sales and merchandising, or marketing plans of Company and any information Company provides regarding third parties.

8.2 Non-Disclosure. Recipient agrees that at all times and notwithstanding any termination or expiration of this Agreement it will hold in strict confidence and not disclose to any third party any Confidential Information except as approved in writing in advance by Company, and will use the Confidential Information for no purpose other than the Purpose. Recipient shall only permit access to Confidential Information to those of its employees or authorized representatives having a need to know and who have signed confidentiality agreements or are otherwise bound by confidentiality obligations at least as restrictive as those contained herein.

8.3. Notice of Disclosure. Recipient shall immediately notify Company upon discovery of any loss or unauthorized disclosure of the Confidential Information.

8.4. Use of Confidential Information. All Confidential Information is provided “AS IS”, without any warranty of any kind. Recipient recognizes and agrees that nothing contained in this Agreement shall be construed as granting it any property rights, by license or otherwise, to any Confidential Information, or to any invention or any patent, copyright, trademark, or other intellectual property right that has issued or that may issue, based on such Confidential Information. Recipient shall not make, have made, use or sell for any purpose any product or service or other item using, incorporating or derived from any Confidential Information, nor make any filings or registrations based on the receipt or use of the Confidential Information, absent separate written approval of Company. Recipient agrees to take proper and reasonable measures to ensure the confidentiality of the Confidential Information.

8.5 No Reproduction. Confidential Information shall not be reproduced in any form except as required to accomplish the intent of this Agreement. Any reproduction of any Confidential Information shall remain the property of Company and shall contain any and all confidential or proprietary notices or legends which appear on the original.

8.6 Term. This NDA Agreement shall terminate three (3) years after the Effective Date, or may be terminated by either party at any time upon thirty (30) days written notice to the other party; provided, however, Recipient’s obligations under this Agreement shall survive termination of the Agreement between the parties and shall be binding upon the Recipient’s heirs, successors and assigns. Upon termination or expiration of the Agreement, or upon written request of Company, Recipient shall promptly return to the Company all documents and other tangible materials representing the Confidential Information and all copies thereof.

9. LIMITATION OF LIABILITY.

Neither party is liable for breach-of-contract damages that the breaching party could not reasonably have foreseen when it entered this Contract.

10. INDEMNITY.

10.1 Overview. CALICO dmfg.'s liability arising out of any sale of Goods to Buyer is expressly limited to either: (i) refund of the purchase price paid by Buyer for such Goods, without interest; or (ii) repair and/or replacement of such Goods, at CALICO dmfg.’s election. Contractor shall not be liable for any damage caused to any material or components supplied by Buyer. In no event shall CALICO dmfg. be liable for any indirect, special, consequential, or incidental damages, any lost profits, or other economic loss of buyer arising out of any breach of any agreement by contractor, any obligation of contractor pursuant to any agreement, or the failure of the goods to perform in any particular manner. The Client is ultimately responsible for verifying and approving any Goods produced by CALICO dmfg. and shall defend, indemnify, and hold harmless CALICO dmfg. from any and all claims arising from the manufacture, production, design, purchase, use, or sale of such special Goods, including, without limitation, claims for patent infringement, and from any related costs, attorneys’ fees, expenses or liabilities incurred by CALICO dmfg. therefrom.

10.2 Client Indemnity.   In this Contract, CALICO dmfg. agrees to indemnify the Client (and its affiliates and its and their directors, officers, employees, and agents) from and against all liabilities, losses, damages, and expenses (including reasonable attorneys’ fees) related to a third-party claim or proceeding arising out of: (i) the work CALICO dmfg. has done under this Contract; (ii) a breach by CALICO dmfg. of its obligations under this Contract; or (iii) a breach by CALICO dmfg. of the promises it is making in Section 5 (Representations).

10.3 Contractor Indemnity.   In this Contract, the Client agrees to indemnify CALICO dmfg. (and its affiliates and its and their directors, officers, employees, and agents) from and against liabilities, losses, damages, and expenses (including reasonable attorneys’ fees) related to a third-party claim or proceeding arising out of a breach by the Client of its obligations under this Contract.

11. GENERAL.

11.1 Assignment.   This Contract applies only to the Client and CALICO dmfg. . CALICO dmfg. cannot assign its rights or delegate its obligations under this Contract to a third-party (other than by will or intestate), without first receiving the Client’s written permission. In contrast, the Client may assign its rights and delegate its obligations under this Contract without CALICO dmfg.’s permission. This is necessary in case, for example, another Client buys out the Client or if the Client decides to sell the work product that results from this Contract.

11.2 Arbitration.   As the exclusive means of initiating adversarial proceedings to resolve any dispute arising under this Contract, a party may demand that the dispute be resolved by arbitration administered by the American Arbitration Association in accordance with its commercial arbitration rules.

11.3 Modification; Waiver.   To change anything in this Contract, the Client and CALICO dmfg. must agree to that change in writing and sign a document showing their contract. Neither party can waive its rights under this Contract or release the other party from its obligations under this Contract, unless the waiving party acknowledges it is doing so in writing and signs a document that says so.

11.4 Notices.

(a)  Over the course of this Contract, one party may need to send a notice to the other party. For the notice to be valid, it must be in writing and delivered in one of the following ways: personal delivery, email, or certified or registered mail (postage prepaid, return receipt requested). The notice must be delivered to the party’s address listed at the end of this Contract or to another address that the party has provided in writing as an appropriate address to receive notice.

(b)  The timing of when a notice is received can be very important. To avoid confusion, a valid notice is considered received as follows: (i) if delivered personally, it is considered received immediately; (ii) if delivered by email, it is considered received upon acknowledgement of receipt; (iii) if delivered by registered or certified mail (postage prepaid, return receipt requested), it is considered received upon receipt as indicated by the date on the signed receipt. If a party refuses to accept notice or if notice cannot be delivered because of a change in address for which no notice was given, then it is considered received when the notice is rejected or unable to be delivered. If the notice is received after 5:00pm on a business day at the location specified in the address for that party, or on a day that is not a business day, then the notice is considered received at 9:00am on the next business day.

11.5 Severability.   This section deals with what happens if a portion of the Contract is found to be unenforceable. If that’s the case, the unenforceable portion will be changed to the minimum extent necessary to make it enforceable, unless that change is not permitted by law, in which case the portion will be disregarded. If any portion of the Contract is changed or disregarded because it is unenforceable, the rest of the Contract is still enforceable.

11.6 Signatures.  The Client and CALICO dmfg. signatures on any associated proposal, work order, estimate, receipt of delivery apply to this contract and shall be mentioned on those documents as such. These signatures count as originals for all purposes.

11.7 Governing Law.  The laws of the state of California govern the rights and obligations of the Client and CALICO dmfg. under this Contract, without regard to conflict of law principles of that state.

11.8 Entire Contract.   This Contract represents the parties’ final and complete understanding of this job and the subject matter discussed in this Contract. This Contract supersedes all other contracts (both written and oral) between the parties.