rhythminnovations

Professional Services Agreement

This Professional Services Agreement, together with one or more statements of work (each an “SOW”) signed by the parties (collectively, this “Agreement”) is entered into as of Effective Date by and between Rhythm Industrials, Inc., a Delaware company d/b/a Rhythm Innovations and having a place of business at 13450 W. Sunrise Blvd., Suite 420, Sunrise, FL, 33323 US (“Rhythm”) and Customer. This Agreement sets forth the terms under which Rhythm will provide professional services set forth in an SOW (collectively, “Services”) and Deliverables (defined below) to Customer. The parties agree as follows:

1. Definitions.

1.1“Affiliate” means an entity which, directly or indirectly, owns or controls, is owned or is controlled by or is under common ownership or control with the applicable party. As used herein, “control” means the power to direct the management or affairs of an entity, and “ownership” means the beneficial ownership of 50% or more of the voting equity securities or other equivalent voting interests of the entity.

1.2 “Deliverables” means the deliverables and other work product uniquely developed by Rhythm for Customer and specifically identified as Deliverables in the applicable SOW. The term Deliverables does not include Pre-existing IP.
1.3 “Pre-existing IP” means any proprietary methodologies, tools, software, documentation, know-how, trade secrets, inventions, or works of authorship conceived or developed independently by Rhythm, or any skills, know-how, methods, concepts, or techniques of a general nature, whether or not acquired, gained or learned during the performance of the Services performed under this Agreement, or from performing similar work for, or providing similar capabilities or products to others. “Skills, know-how, methods, concepts, or techniques of a general nature” will include, without limitation, information that could reasonably have been acquired in similar work performed for another.

2.Scope

Each SOW will set forth the applicable Services and any related requirements. Any changes to this Agreement or SOW will require a written amendment signed by the parties. All Deliverables will be delivered electronically to Customer. Title and risk of loss to tangible Deliverables will pass to Customer upon delivery at the Customer destination.

3.Fees.

3.1 Payment. Customer shall pay Rhythm the fees specified in the applicable SOW. Fees and expenses due from Customer under this Agreement may not be withheld or offset by Customer against other amounts for any reason. If any invoiced amount is not received by Rhythm by the due date, then, without limiting Rhythm rights or remedies, those amounts will accrue interest at a rate of 1.5% per month or the maximum allowed under state law (whichever is lower). Rhythm, at its option, may suspend the Services, in whole or in part, if Rhythm does not receive all amounts due and owing in accordance with this Agreement. Rhythm shall be entitled to an award for its reasonable attorney’s fees and collection costs in connection with Customer’s breach of its payment obligations. Rhythm fees do not include any taxes, levies, duties, or similar governmental assessments of any nature, including, for example, value-added, sales, use or withholding taxes, assessable by any jurisdiction whatsoever (collectively, “Taxes”). Customer is responsible for paying all Taxes associated with its purchases hereunder.

3.2 Expenses. Customer will reimburse Rhythm, at cost, for reasonable expenses incurred by Rhythm in performing the Services, subject to Customer’s pre-approval.
3.3 Invoices. Rhythm shall (a) invoice Customer monthly for time and material SOW(s), and (b) for fixed price SOW(s), shall invoice Customer in accordance with the schedule set forth in the applicable SOW, or if no schedule is set forth, upon execution of the SOW. Customer shall pay all invoices in U.S. Dollars within thirty (30) days of the date of the invoice.

4.Customer obligations.

Customer shall:

(a) have the overall direction and responsibility for all Services to be performed hereunder;
(b) provide Rhythm, in a timely fashion, with all information and data reasonably required for the performance of the Services by Rhythm hereunder;
(c) provide Rhythm with reasonable access to the premises, locations and systems necessary for the performance of the Services;
(d) cooperate fully with Rhythm in the provision of Services;
(e) timely participate in meetings and make its personnel readily available for such meetings; and
(f) assign personnel with relevant training and experience to work as part of a project team with Rhythm or in consultation with Rhythm personnel.

5.Covenants.

5.1 Confidentiality. “Confidential Information” includes all technical and non-technical information provided by a party (“Disclosing Party”) to the other party (“Receiving Party”). All information concerning or related to Disclosing Party’s products, services, technologies, product roadmaps, future unpublished features, or functionality, technical or functional specifications or information, financial data and models, business and marketing plans and any information related to the foregoing constitutes the Confidential Information and property of Disclosing Party.


The Receiving Party will not:

(1) use any Confidential Information except for the sole benefit of the Disclosing Party and only to the extent necessary to provide the services under this Agreement; or
(2) disclose any Confidential Information of the Disclosing Party to any person or entity, except to the Receiving Party’ personnel who are involved in performing this Agreement, have a need to know, and have signed a non-disclosure agreement with terms substantially as restrictive as those herein. Other than the Deliverables,

the foregoing will not apply to any information that:

(a) is rightfully known by the Receiving Party prior to disclosure by the Disclosing Party;
(b) is rightfully obtained by the Receiving Party from a third party without restrictions on disclosure;
(c) is disclosed by the Receiving Party with the prior written approval of the Disclosing Party; or
(d) to the extent required by law or court order so long as Receiving Party provides advance notice to the Disclosing Party as promptly as possible and cooperates with the Disclosing Party’s efforts to obtain a protective order regarding such disclosure. Upon expiration or any termination of this Agreement the Receiving Party will promptly destroy or (if requested) return the Disclosing Party’s Confidential Information and all copies thereof, provided that the Receiving Party may retain a single archival copy of Confidential Information if required to do so under applicable law.
5.2 Non-Solicit. During the term of this Agreement, and for a period of two (2) years following the expiration or termination of this Agreement, Customer shall not, without the prior written consent of Rhythm, directly or indirectly solicit or hire any employee or independent contractor of Rhythm with whom it was introduced through the relationship established by this Agreement. If the Customer violates this section, Customer shall be required to pay Rhythm as liquidated damages, not as a penalty, one hundred percent (100%) of the annualized salary for each affected employee or independent contractor. Customer agrees that these liquidated damages are reasonable.

6.Ownership.

6.1 Ownership. To the fullest extent permitted by law and save in respect of Pre-existing IP licensed to Customer pursuant to Section 6.3, Customer shall retain sole and exclusive ownership of all right, title and interest to all Deliverables. Each party retains sole and exclusive ownership of its Confidential Information. Rhythm shall retain sole and exclusive ownership of all rights, title, and interest to all Pre-existing IP.

6.2 Assignment. Subject to Section 6.3 and Rhythm receipt of full payment for the applicable Deliverable, all Deliverables and all intellectual property rights in the Deliverables will be the sole and exclusive property of Customer and will be deemed to be a “work made for hire” (as defined in Section 101 of Title 17 of the United States Code). If any Deliverables is determined not to be “work made for hire,” Rhythm assigns to Customer all right, title and interest in and to the Deliverables, including all intellectual property rights subsisting therein. Rhythm will cooperate with Customer to any commercially reasonable extent to effectuate Rhythm assignment of intellectual property rights in and to the Deliverables.
6.3 License.If Rhythm incorporates into or provides in conjunction with any Deliverables any Pre-existing IP, then subject to Rhythm receipt of full payment for the Deliverables, Rhythm hereby grants Customer (including Customer’s contractors, Affiliates, and agents) a non-exclusive, royalty-free, fully paid up, irrevocable, worldwide, perpetual license (with the right to sublicense) to make, have made, sell, offer for sale, use, execute, reproduce, modify, adapt, display, perform, distribute, make derivative works of, import, export, and disclose the Pre-existing IP in connection with the Deliverables.
6.4 Feedback.Customer may from time-to-time provide suggestions, comments, or other feedback with respect to Rhythm’s products, services, or technologies (“Feedback”). For the avoidance of doubt, Feedback will only refer to suggestions, comments or other feedback provided to Rhythm specifically regarding the Services, a Deliverable or any of Rhythm’s products, services, or technologies. Rhythm may want to incorporate Feedback into Rhythm’s products, services or technologies and this clause provides Rhythm with the necessary license to do so. Customer hereby grants to Rhythm a royalty-free, worldwide, perpetual, irrevocable, fully transferable and sublicensable right and license to use, disclose, reproduce, modify, create derivative works from, distribute, display and otherwise distribute and exploit any Feedback, without obligation or restriction, except that Rhythm will not identify Customer as the provider of such Feedback.

7.Warranty.

7.1 Warranties.
Rhythm warrants that

(a) Rhythm will perform the Services in a professional and skillful manner and
(b) the Deliverables will substantially conform to the requirements of the applicable SOW upon their delivery.
7.2 Correction of Deliverables. Rhythm will, without charge, correct any non-conformity, defect, or malfunction in any Deliverables within thirty (30) days of written notice from Customer after their delivery provided such written notice specially identifies each deficiency to be corrected. If Rhythm determines that it is unable to correct the Deliverables, Rhythm sole obligation and Customer’s exclusive remedy, at Rhythm sole cost and expense, is to do one of the following:

(a)replace the affected Deliverables;
(b)modify the affected Deliverables so that they are conforming to the warranty in Section 7.1; or
(c)refund Customer all fees paid for the non-conforming Deliverables. THIS SECTION SETS FORTH CUSTOMER’S SOLE REMEDY FOR ANY BREACH OF SECTION 7.1.
7.3 Disclaimer.EXCEPT AS EXPRESSLY SET FORTH IN SECTION 7.1, RHYTHM DISCLAIMS ALL WARRANTIES, CONDITIONS, OR REPRESENTATIONS TO CUSTOMER REGARDING THIS AGREEMENT AND THE SERVICES, WHETHER ORAL OR WRITTEN, EXPRESS, IMPLIED, OR STATUTORY. WITHOUT LIMITING THE FOREGOING, ANY IMPLIED WARRANTY OR CONDITION OF MERCHANTABILITY, THE IMPLIED WARRANTY AGAINST INFRINGEMENT, THE IMPLIED WARRANTY OF TITLE, THE IMPLIED WARRANTY OR CONDITION OF FITNESS FOR A PARTICULAR PURPOSE, AND THOSE ARISING FROM A COURSE OF DEALING OR USAGE OF TRADE ARE EXPRESSLY EXCLUDED AND DISCLAIMED BY RHYTHM. NO WARRANTY IS MADE THAT THE SERVICES AND DELIVERABLES WILL BE ERROR FREE, THAT ALL ERRORS OR DEFECTS WILL BE CORRECTED, OR THAT THE SERVICES AND DELIVERABLES WILL MEET CUSTOMER’S REQUIREMENTS.

8.Indemnity.

Rhythm will at its expense defend Customer from any and all claims, actions or lawsuits brought by an unaffiliated third party and indemnify Customer against any settlements agreed to by Rhythm or damages, losses and expenses (including attorneys’ fees and court costs) in each case awarded against Customer by a court of competent jurisdiction in favor of the applicable unaffiliated third party to the extent such third party claim, action or lawsuit arises out of any allegation that the Deliverables infringe on the intellectual property rights of such third party bringing the claim, action or lawsuit (each a “Claim”), provided that

(a)Customer is not then in breach of this Agreement,
(b) Customer gives prompt written notice of a Claim,
(c) Rhythm is permitted sole control of the defense and settlement of each Claim and
(d) Customer provides reasonable cooperation in the defense and settlement of each Claim. Customer may participate in the defense of such Claim with counsel of its choice at its expense. In no event will Rhythm settle any Claim without Customer’s prior written consent, not to be unreasonably delayed. Rhythm will have no obligations under this Section 8 with respect to Claims arising out of:

(a) any instruction, information, designs, specifications or other materials provided by Customer to Rhythm;
(b) use of the Deliverables in combination with any materials or equipment not supplied to Customer;
(c) any modifications or changes made to the Deliverables by or on behalf of any person or entity other than Rhythm;
(d) the use of any version of the Deliverables other than the most current release made available by Rhythm; or
(e) Customer’s negligence or more culpable conduct. If a Deliverable, or any part thereof, becomes, or in the opinion of Rhythm may become, the subject of a claim of infringement or misappropriation, Rhythm may, at its option:

(x) obtain a license for Customer’s continued use of that Deliverables in accordance with this Agreement;
(y) replace or modify the Deliverables so that they are no longer claimed to infringe or misappropriate; or
(z) terminate this Agreement and refund to Customer any portion of the fees prepaid by Customer for the infringing Deliverables.

9.Liability.

NEITHER PARTY WILL BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE DAMAGES, REGARDLESS OF THE FORM OF ACTION WHETHER IN CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY, OR OTHERWISE, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. EACH PARTY’S MAXIMUM AGGREGATE LIABILITY UNDER THIS AGREEMENT SHALL BE LIMITED TO THE TOTAL AMOUNTS PAID BY CUSTOMER TO RHYTHM UNDER THE APPLICABLE SOW DURING THE TWELVE (12) MONTHS IMMEDIATELY PRECEDING THE CLAIM. THIS SECTION DOES NOT APPLY TO A BREACH OF SECTION 5.

10.Term and Termination..

10.1 Term. The term of this Agreement will begin on the Effective Date and continue for a period of one (1) year, automatically renewing thereafter for additional one (1) year periods, unless terminated earlier as per this Section 10. The initial term and all renewal terms are collectively referred to as the “Term.”

10.2 Termination. Either party may terminate this Agreement if the other party fails to cure any breach of this Agreement within thirty (30) days of the non-breaching party’s written notice of such breach. Any expiration of this Agreement or termination of an SOW shall not result in termination of any other SOW(s) or this Agreement. However, Rhythm termination of this Agreement shall result in termination of all then-pending SOW(s).
10.3 Effect of Termination. Sections 1 (Definitions), 3 (Fees), 4 (Confidentiality), 6 (Ownership), 8 (Indemnity), 9 (Liability), 10.3 (Effect of Termination), and 11 (General) will survive the termination or expiration of this Agreement.
11.General

11.1 Publicity. Customer agrees to grant Rhythm the right to use Customer’s company name, logo (subject to appropriate trademark attribution), and any associated statements of support for the Services on Rhythm marketing collateral, including Rhythm website, press releases, presentations and documents, case studies, and in sales discussions with prospective customers.

11.2 Non-exclusive Engagement. Customer acknowledges that Rhythm may be engaged on behalf of other Customers in the development, licensing, sale, or use of computer software or works and services functionally similar to Deliverables and Services. Customer further acknowledges that Rhythm will be entitled to engage in transactions and implement projects for any third party. Rhythm retains all rights and license to its knowledge and experience (including processes, ideas, concepts, and techniques) acquired or developed by Rhythm prior to, or in the course of performing the Services.
11.3 Independent Contractors.  Rhythm is an independent contractor and not a partner, agent, or joint venturer with Customer. Rhythm will be solely responsible for all acts, obligations, and payments due with respect to its personnel used to perform the Services. Rhythm, and not Customer, will be responsible for the hiring, management, supervision, discipline, control, performance, and all other employment related requirements of the Rhythm personnel. Neither party will have the power to bind the other or incur obligations on the other party’s behalf without the other party’s prior written consent.
11.4 Assignment. Neither party may assign this Agreement without the prior written consent of the other party and any attempt to do so will be null and void. Notwithstanding the foregoing, either party may assign this Agreement to any Affiliate or any entity in connection with a reorganization, merger, consolidation, acquisition, or other transaction involving all or substantially all of the voting securities or assets of such party, upon written notice to the non-assigning party.
11.5 Force Majeure. Each party hereto shall be excused from default or delay in the performance of its obligations hereunder if and to the extent that such default or delay is caused by an act of God, or other cause beyond its reasonable control, including but not limited to, work stoppages, cyber-attacks, fires, riots, accident, explosion, flood, storm, or failures or fluctuations in electrical power, heat light, air conditioning or telecommunications equipment, an unanticipated event that materially changes the service needs or requirements of Customer, a change in law, the case when Rhythm personnel performing the Services is fired or has quit. In such event, the non-performing party shall be excused from performance for as long as such circumstances prevail. If such delays last for an aggregate of 60 (sixty) days or more, either party shall be entitled to terminate this Agreement by giving written notice to the other party, such termination to be effective on the date indicated in this notice. In the event of such termination, Customer shall pay Rhythm for all fees and expenses incurred under this Agreement through the effective date of termination of this Agreement and each SOW, whichever is later. Upon such termination above and upon full payment, Rhythm, in its turn, shall deliver to Customer all interim Deliverables (complete or incomplete) in Rhythm possession.
11.6 Governing Law This Agreement will be governed and construed under the laws of the State of Florida without regard to conflicts of law provisions. Any suit or proceeding arising out of or relating to this Agreement will be brought in the federal or state courts, as applicable, in Florida, and each party irrevocably submits to the jurisdiction and venue of such courts.
11.7 Notices
Any notice hereunder will be in writing to the address set forth above and will be deemed given:

(i)upon receipt if by personal delivery;
(ii)upon receipt if sent by certified or registered U.S. Mail (return receipt requested); or
(iii)one (1) day after it is sent if by next day delivery by a major commercial delivery service or by electronic mail.
11.8 Entire Agreement. This Agreement is the entire agreement of the parties and supersedes all previous or contemporaneous agreements between the parties relating to its subject matter. This Agreement may only be modified by an amendment signed by the parties.
11.9 Waiver and Severability. No provision of this Agreement will be waived by any act, omission or knowledge of a party or its agents or employees except specifically in a writing signed by the waiving party. If any provision is deemed by a court unenforceable or invalid, that provision will be stricken or modified, and the remainder of this Agreement will be in full force and effect.
11.10 Counterparts This Agreement, including its SOWs, may be executed in counterparts including PDF and other electronic copies, each of which will be deemed an original and together will constitute the same instrument.