FIRST DIGITAL SYSTEMS INC – Terms and Conditions of Commercial Engagement

1. Interpretation
The following terms shall have the meanings set out below
in these Terms or a Statement of Works (SoW).
FDS: First Digital Systems INC.
Change Control:
The change control process set out in Clause 6.
Fees, Extra Fees:
Fees specified in a SoW and including Extra Fees where appropriate.
Expenses: Expenses incurred in the course of work carried out in the SoW including travel, communications and third party costs.
Intellectual Property Rights :
All copyrights (including copyright in computer software), source code, database rights, rights in inventions, patents, trademarks, trade names, service marks, design rights (whether registered or unregistered), trade secrets, rights in confidential information and all other industrial or intellectual property rights of whatever nature excluding patent applications and know-how; Customer Materials any text, graphics or picture files, audio-visual content, data or other
material provided by the Customer.
FDS Materials:
Any text, graphics or picture files, audio-visual content, data,
source code or other material sourced or created by FDS.
Documentation and Printed Materials:
Any electronic documentation or printed material supplied by
FDS including Proposal Documentation, Responses to client
requests, Proofs, etc.
Services provided by FDS in accordance with these
Terms, SoW or SLA.
Statement of Work (SoW):
A document, including budget cost, timetable & details of the
work to be undertaken.
A Service Level Agreement describing any Maintenance & Support services provided by FDS.
Terms: these terms;
Any Website developed by FDS in accordance with these terms and/or a SoW.2. Agreeing a Statement of Works (SoW)2.1 When Services are requested by the Customer, FDS
may provide the Customer with a SoW.
2.2 The SoW will be signed by the parties and
as such the SoW(s) shall stand as FDS’s
authority to invoice as appropriate.
2.3 FDS shall be under no obligation to perform any
Services until a SoW is agreed but when
FDS is requested to commence Services prior to
SoW signature on the verbal or written
instructions of the Customer, these Terms shall apply,
including all payment terms.
3. FDS Obligations
3.1 FDS shall provide the Services in accordance with
these terms and those in the SoW.
3.2 FDS shall use all reasonable endeavours to comply
with any dates set out in a SoW. However, time
shall not be of the essence in relation to any agreed date.
4. Customer Obligations
4.1 The Customer or Customer’s representative shall cooperate
with FDS at all times to include (without limit)
attendance at relevant meetings, dealing promptly with all
reasonable requests for information by FDS, sign off of
deliverables promptly, and co-ordinating key people
(Customer staff) as appropriate to a SoW.
4.2 The Customer shall provide FDS with all
information, co-operation and support, key people and
such computer facilities, office space, desks, telephones,
typing and other office facilities at the Customer’s
premises which may be reasonably necessary to enable
FDS to perform the Services.
4.3 The Customer shall ensure that FDS’s staff (to
include any sub-contractors or consultants) have a safe
place of work when they are working at their premises and
any other premises at the Customer’s request.
5. Fees and Payment Terms
5.1 The Customer shall pay the Fees in sterling. Fees
exclude expenses, delivery expenses and VAT which shall
be paid by the Customer at the rate, and in the manner
prescribed by law.
5.2 If any sum payable is not paid by the due date, then
(without prejudice to FDS’s other rights and remedies)
FDS reserves the right to;
5.2.1 Charge interest on that sum on a daily basis (before
as well as after any judgment) from the due date to the
date of payment at the rate of 15% above the base rate of
Lloyds Banking Group plc from time to time in force (in accordance
with the Late Payment of Commercial Debts Interest Act
5.2.2 Terminate or suspend the performance of any
Services until payment is made. In such circumstances,
the timetable (if any) will be amended to reflect any period
of suspension.
5.3 FDS shall be entitled to revise Fees and this shall
include sums for any recurring item provided by a subcontractor
or third party to reflect any cost increases
imposed by the sub-contractor or third party.
5.4 FDS shall be entitled to raise invoices for Fees as
follows, unless otherwise stated in a SoW, a
deposit of 50% will be invoiced upon signature of all
SoWs and the balance shall be invoiced on
completion. The deposit payment shall be due prior to
commencement of the Project with subsequent invoiced
payments due within 7 days of invoice.
5.5 All Deposits shall, at all times, be treated as non-refundable.
5.6 FDS shall be entitled to recover from the Customer
any loss suffered by or caused to FDS due to non or
partial performance of a SoW arising from any
circumstances arising in Clause 14, cancellation or
otherwise due to suspension or delay of any delivery of
Service where the same is occasioned by the Customer.
5.6.1 The loss above shall include (but is not limited to)
direct, indirect or consequential loss (all three of which
terms include, without limitation, pure economic loss, loss
of profits, loss of business, loss of revenue) costs,
damages, charges or expenses.
5.7 Notwithstanding clause 5.6 above, where the Service
includes training, FDS shall be entitled to invoice the
Customer for 50% of the total project Fees where cancellation by the
Customer occurs less than 5 days prior to the delivery date
or 100% where such cancellation is less than 24 hours
before the commencement of the project.
5.8 All Fees paid for Maintenance and Support e.g. as included
in a SLA are non-refundable.
5.9 Expenses will be invoiced as and when incurred.
5.10 Title to Websites and Printed Materials shall only pass
to the Customer when all Fees, taxes and other charges
set out in a SoW have been paid in full. Risk in
the Website shall pass on actual delivery.
5.11Payment Methods: All payments must be made by
electronic transfer to FDS’s nominated bank account in pounds sterling.
Payment cannot be made by non-electronic methods unless agreed in
writing by FDS at the time of invoice.

6. Change Control
6.1 If the Customer wishes to request or suggest a change
to a SoW or Specification at any time, the Customer shall
provide FDS with full written details of the change and any
such further information as FDS shall reasonably
require. This includes Specification changes.
6.2 FDS shall then provide the Customer with a Change
Control Form as soon as is reasonably practicable
specifying what variation (if any) will be required to the
original SoW (for example the Fees, the
timetable for delivery and if extra services will be needed
to implement the change).
6.3 If FDS wishes to request or suggest a change at
any time, FDSwill provide the Customer with a Change
Control Form as provided above for consideration by the
6.4 Within 2 days of receipt of any Change Control Form
the Customer may elect either:
6.4.1 To accept it, in which case the SoW shall
be changed in accordance with that form; or
6.4.2 To withdraw the proposed change in which case the
SoW shall continue in force unchanged. This
timescale may be expedited where circumstances dictate
and FDS shall advise the Customer where this shall
6.5 FDS shall be entitled to charge Extra Fees for
considering any changes proposed by the Customer and
preparing the Change Control Form.
6.6 If the Customer’s request for the change at Clause 6.1
is later withdrawn but results in a delay to the performance
of Services, FDS shall not be liable for any consequence
of that delay and shall be entitled to an extension of time
for performance of its duties equal to the period of the
6.7 FDS shall not be obliged to consider or make any
change except in accordance with this procedure.
7. Intellectual Property Rights
7.1 Intellectual Property Rights in the Customer Material
shall remain the property of the Customer at all times.
7.2 Intellectual Property Rights in the Website, Source Code,
Specifications, Proofs and any other work resulting
from Services provided within the Project shall remain the
property of FDS unless otherwise agreed in writing.
7.3 Subject to clause 7.4 below and save for those parts
of FDS Material created by a third party, FDS may
assign Intellectual Property Rights in FDS Material to
the Customer.
7.4 The Intellectual Property Rights in clause 7.2 and 7.3
above may be transferred to the Customer provided that the
Customer has paid a IPR acquisition Fee and providing that all other
Fees and taxes resulting from or in connection with the appropriate
SoW have also been paid in full.
7.5 FDS shall retain all rights to use Intellectual
Property Rights to patent applications and know how
associated with the SoWs at all times.
7.6 Where either party shall acquire, by operation of law,
Intellectual Property Rights referred to above and such
acquisition is inconsistent with the allocation of
Intellectual Property Rights set out in those clauses, such
Intellectual Property Rights as it has acquired shall be
assigned to the other party on the request of the other
party (whenever made).
7.7 The SoW IPR remains the property of FDS at all times and Client
agrees not to reveal in any way the contents of the SoW to a third party
without written consent of FDS.
8. Indemnities
8.1 Where FDS has prepared a SoW, FDS
shall indemnify and keep the Customer fully indemnified
against all costs, claims, demands, expenses and
liabilities arising out of or in connection with any claim that
the use or possession of the Website or Printed Materials
by the Customer or provision of the Services infringes any
Intellectual Property Rights of any third party (limited to the
UK) provided that:
8.1.1 The Customer gives written notice to FDS of any
claims or proceedings immediately following receipt of
8.1.2 The Customer makes no admission of liability and
gives FDS sole authority to defend or settle the claims
or proceedings at FDS’s cost and expense;
8.1.3 The Customer gives FDS all reasonable help in
connection with the claims or proceedings at FDS’s
cost and expense.
8.2 In dealing with any claim identified in 8.1 above,
FDS may at its own expense and option:
8.2.1 Pay for the right to continue using the Website,
Printed Material or receive the Service; or
8.2.2 Make any changes to the Service or Website
without materially reducing its functionality.
8.3 Clause 8 states FDS’s entire liability to the
Customer in respect of the infringement of the Intellectual
Property Rights of any third party.
8.4 The Customer shall indemnify and keep FDS fully
indemnified against all costs, claims, demands, expenses
and liabilities arising out of or in connection with any claim
that the use or possession of the Customer Material in the
Website or Printed Material infringes any Intellectual
Property Rights of any third party. This indemnity shall also
extend to Websites or Printed Materials supplied by
FDS based on specifications provided by the Customer.

9. SLA
9.1 Where Customer & FDS has entered into a SLA, FDS
agrees to provide on-going services.
9.2 Unless otherwise specified the SLA will run for a period of
twelve months.
9.3 Fees due in accordance with the SLA shall be invoiced
and paid for in full prior to the commencement of the SLA.
9.4 Termination of SLA
9.4.1The SLA may be terminated by either party giving three months
notice in writing.
9.5 Refund of payments for SLA in the event of Termination:
9.5.1 Where FDS terminates – FDS will refund fees that havepaid
pro rata from the expiry date of the SLA to the expiry of the notice period.
9.5.2 Where Customer terminates – no refund of fees will be due.
10 Data Protection
10.1 The parties undertake to comply with the provisions of
the Data Protection Act 1998 and any related legislation in
so far as the same relates to a SoW.
10.2 Where FDS collates Personal Data as part of a
Service FDS warrants that any Personal Data collated
shall comply with the eight Data Protection principles and
that all necessary consents have been obtained from
individuals, and FDS shall indemnify the Customer from
and against all costs, claims, liabilities and demands
arising out of any breach.
10.3 The Customer warrants that any Personal Data
provided to FDS for inclusion in the Website or Printed
Materials shall comply with the eight Data Protection
principles and that all necessary consents have been
obtained from individuals, and the Customer shall
indemnify FDS from and against all costs, claims,
liabilities and demands arising out of any breach.
11. Warranties
11.1 Where appropriate to the SoW, FDS
warrants, that ;
11.1.2 It has the right to provide Services;
11.1.3 Services will be carried out using reasonable care
and skill and in accordance with good industry practice;
11.1.4 All staff (employees, sub-contractors, consultants)
engaged in the provision of the Services shall be suitably
qualified and/or experienced.
11.2 FDS hereby excludes any implied condition or
warranty concerning the quality or fitness for purpose of
the Services whether such condition or warranty is
implied by statute or common law.
11.3 The Customer warrants that it is the owner of any
Customer Material used in providing the services, or that it
has valid permission to use the material and the Customer
shall fully indemnify FDS in respect of any claims
howsoever arising in respect of the Customer Material.
12 Limitation of Liability
12.1 Nothing in these terms shall operate to exclude or
limit either party’s liability for death or personal injury
caused by its negligence, any breach of the terms implied
by section 12 of the Sale of Goods Act 1979, or section 2 of
the Supply of Goods and services Act 1982, fraud; or, any
other liability which cannot be excluded or limited under
applicable law.
12.2 Neither party shall be liable to the other for any loss
which shall include (but is not limited to) direct, indirect or
consequential loss (all three of which terms include,
without limitation, pure economic loss, loss of profits, loss
of business, loss of revenue) costs, damages, charges or
12.3 Subject to clause 11.1 FDS’s liability in respect of
claims arising out of a SoW (or a series of
related SoWs) shall be limited to the value of
the Fees paid by the Customer at the time that the claim(s)
13. Confidentiality
13.1 Neither party shall, without the authority of the other,
disclose to any third party any confidential information
concerning the products, customers, business, accounts,
finance or contractual arrangements or other dealings,
transactions or affairs of the other which may come to that
party’s knowledge in the course of performing its duties.
14 Termination of SoW
14.1 Unless otherwise agreed, the SoW is valid for 30 days.
14.2 A SoW can be terminated by either party
giving to the other not less than 14 days notice in writing.
Where the Customer terminates, Fees will remain due to
FDS in accordance with clause 5.6 to 5.8 inclusive.
14.3 Either party shall have the right by giving written
notice to the other to terminate ongoing SoWs
immediately if that other party;
14.3.1 Commits any material breach of its duties and fails
to remedy that breach within 30 days of written notice of
that breach, the 30 day period only applies where a breach
is capable of remedy – if it is incapable of remedy. Service
Request may be terminated by written notice straight
away; or
14.3.2 Has a winding up petition presented or enters into
liquidation whether compulsorily or voluntarily (otherwise
that for the purposes of amalgamation or reconstruction
without insolvency) or makes an arrangement with its
creditors or petitions for an administration order or has a
receiver or manager appointed over any of its assets or
generally becomes unable to pay its debts within the
meaning of Section 123 of the Insolvency Act 1986.
15. Effect of termination
15.1 On termination of SoWs howsoever
15.1.1 FDS shall return all copies of Customer
Materials provided by the Customer in the provision of
15.1.2 Any rights of either party which arose on or before
termination shall be unaffected.
15.2 The Customer shall not, without the prior written
consent of FDS, actively initiate recruitment of any of
FDS staff who have been actively engaged in the
provision of Services during the life of, or for a period of 6
months from expiry or termination of the SoW.
15.3 If the Customer breaches Clause 14.2, it shall pay
FDS a sum equivalent to half of the individual’s gross
annual salary in recognition of the value of that staff
member to FDS and the inconvenience which would be
caused. The parties agree that this sum is a genuine estimate
of the loss likely to be suffered by FDS in these
16 Dispute Resolution
16.1 The parties shall attempt to resolve any dispute
arising out of or relating to these Terms through
16.2 If the matter is not resolved at this meeting, the
matter will be referred to the next level of the parties’
management with authority to settle the same, who will
meet within 14 days to attempt to resolve the matter. If the
unresolved matter is having a serious effect on the
Service, Support of a SLA or other elements of the completion of a
SoW, the parties will use best endeavours to
reduce the elapsed time in completing the process.
16.3 If the matter is not resolved through negotiation,
(and further negotiation is not possible under 15.2 due to
lack of management roles) the parties will attempt to
resolve the dispute in good faith through mediation using a
mediator recommended by CEDR- the Centre for Dispute
16.4 If the matter has not been resolved by an ADR
procedure within 30 days of the initiation of that
procedure, or if either party will not participate in an ADR
procedure, the dispute shall be decided by the High Court
of England and Wales and the parties submit to its
exclusive jurisdiction for that purpose.
16.5 These Terms shall be governed by the laws of England
and Wales.
17 General Provisions
17.1 These Terms and each SoW supersedes
any prior agreements, arrangements and undertakings
between the parties in relation to its subject matter and
constitutes the entire agreement between the parties
relating to that subject matter.
17.2 The Customer agrees that it will have no remedy in
respect of any untrue statement made to it upon which it
relied in entering into these Terms or a SoW
and that its only remedies can be for breach contract
(unless the statement was made fraudulently).
17.3 Neither party shall be liable for any delay or failure to
perform its duties caused by any circumstances beyond
its reasonable control.
17.4 The Customer agrees that FDS may acknowledge
this agreement and SoWs in publicity material
and tenders. The Customer hereby grants to FDS a nonexclusive
and perpetual licence to place a link to the
Customer Website developed by FDS from FDS’s
own promotional Website.
17.5 If any part of these Terms is held unlawful or
unenforceable that part shall be struck out and the
remainder of this framework agreement shall remain in
17.6 No delay, neglect or forbearance by either party in
enforcing its rights under this framework agreement shall
be a waiver of or prejudice those rights.
17.7 The Customer may not assign or otherwise transfer
these Terms or any of its rights and duties hereunder
whether in whole or in part.
17.8 FDS may sub-contract the performance of any of
its duties under these Terms and may assign or otherwise
transfer these Terms.
17.9 All notices shall be in writing and shall be sent to the
address of the recipient set out at the top of these Terms or
to such other address as the recipient may have notified
from time to time. Any notice may be delivered personally
or by first-class post, fax or email and shall be deemed to
have been served if by hand when delivered, if by first
class post 48 hours after posting and if by fax or email
when confirmation of transmission is received.
17.10 The parties agree that any person who is not a party
to these Terms shall have no right to enforce any term
against either of the parties under the Contracts (Rights of
Third Parties) Act 1999.